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About Collectible Concepts, Inc.
Collectible Concepts Inc., in business since 1991, manufactures and markets specialty sports and entertainment products under license agreements with major sports teams and entertainment personalities. The company presently has license agreements with the National Hockey League (NHL) and the National Basketball Association (NBA).
Collectible Concepts Inc. is a fully reporting company whose stock trades on the OTCBB under the symbol "CCNGI." For information contact Investor Relations at 215-491-1075.
The posts and information on this board do not necessarily reflect the opinions of Investorshub.com or the moderators of this forum. The moderators may or may not hold an interest in this stock.
COMPANY INFORMATION:
Collectible Concepts, Inc.
1600 Lower State Road
Doylestown, PA 18901
Phone: 215-491-1075
Fax: 215-491-1079
info@collectibleconcepts.com
http://www.collectibleconcepts.com
Paul S. Lipschutz, President (from CCNG website)
Terry Macioge, President of Sales and Marketing (from CCNG website)
State of Incorporation: Delaware
(To search https://sos-res.state.de.us/tin/GINameSearch.jsp )
PUBLIC SOURCE INFORMATION:
Outstanding shares from 10QSB filing 1/16/2007- link below
State the number of shares outstanding of each of the registrant's classes of common equity, as of the latest practicable date: 347,275,928 shares issued and outstanding as of January 10, 2007.
Transfer Agent
American Registar & Transfer
Current 15c2-11 SEC Act of 1934 Information and Disclosure
SEC FILINGS: Most recent
Filing Date: 1/16/2007 Form Type: 10QSB
http://secfilings.nasdaq.com/filingFrameset.asp?FileName=0001144204%2D07%2D001927%2Etxt&FilePath....
link to all SEC filings
http://www.nasdaq.com/asp/quotes_sec.asp?symbol=CCNG&selected=CCNG&page=filings
PRESS RELEASES:
link to CCNG website where all NEWS can be found on the NEWS tab
http://www.collectibleconcepts.com/press/latestnews.html
Collectible Concepts Group Inc. Hits a Home Run
Tuesday February 13, 8:00 am ET
http://biz.yahoo.com/bw/070213/20070213005335.html?.v=1
Collectible Concepts Group Launches New Armed Forces Mascot Collection Website
Tuesday January 9, 8:45 am ET
http://biz.yahoo.com/iw/070109/0201252.html
Collectible Concepts to Boost Licensed Sports Merchandise With Wi-Fi TV Station
Monday January 8, 10:35 am ET
Licensed Major Team Collectibles Will Be Showcased on Social Internet TV(TM) Station
http://biz.yahoo.com/iw/070108/0200704.html
Wi-Fi TV Launch Partner Collectible Concepts Group Inc. Offering Licensed Major Sports, Army, Navy, Marine and Coast Guard Products and Upcoming Wi-Fi TV Station
Wednesday February 21, 11:00 am ET
http://biz.yahoo.com/iw/070221/0218221.html
Collectible Concepts Group, Inc. Retains H. Brooks & Associates to Spearhead Internet Marketing of Its Military Gifts & Collectibles
Thursday March 22, 10:58 am ET
http://biz.yahoo.com/iw/070322/0229825.html
http://stockcharts.com/h-sc/ui?s=CCNG&p=D&yr=0&mn=2&dy=0&id=p42954476168
This is why it's impossible for the share price to fly on this stock. The convertible noteholders print shares for 1/3 of the price of the lowest close. So that means print, print, print, sell for .0001, reverse split. It's what they have to do.
COLLECTIBLE CONCEPTS GROUP, INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of November 30, 2006
(Unaudited)
NOTE C - CONVERTIBLE SECURED DEBENTURES
Notes payable at November 30, 2006 and February 28, 2006 are as follows:
November 30,
2006 February 28, 2006
10% convertible debenture dated May 2000, face value of $400,000, due one year from the date of the note with interest payable quarterly during the life of the note. The note is convertible into the Company’s common stock at the lower of a) $4.00 (See Note F) or b) 25% of market value. The Company has granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) $ 169,672 $ 258,820
12% convertible debenture dated May 28, 2002, face value of $75,000, due one year from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 75,000 75,000
15% convertible debenture dated November 26, 2002, face value of $250,000, due one year from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 250,000 250,000
15% convertible debenture dated May 15, 2003, face value of $25,000, due one year from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 25,000 25,000
10
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COLLECTIBLE CONCEPTS GROUP, INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of November 30, 2006
(Unaudited)
NOTE C - CONVERTIBLE SECURED DEBENTURES (continued)
November 30,
2006 February 28, 2006
15% convertible debenture dated June 20, 2003, face value of $25,000, due one year from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 25,000 25,000
15% convertible debenture dated July 23, 2003, face value of $25,000, due one year from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 25,000 25,000
15% convertible debenture dated November 14, 2003, face value of $50,000, due one year from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 50,000 50,000
15% convertible debenture dated January 13, 2004, face value of $50,000, due one year from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) $ 50,000 $ 50,000
11
--------------------------------------------------------------------------------
COLLECTIBLE CONCEPTS GROUP, INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of November 30, 2006
(Unaudited)
NOTE C - CONVERTIBLE SECURED DEBENTURES (continued)
November 30,
2006 February 28, 2006
15% convertible debenture dated February 13, 2004, face value of $25,000, due one year from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 25,000 25,000
15% convertible debenture March 16, 2004, face value of $100,000, due one year from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 100,000 100,000
15% convertible debenture dated May 28, 2004, face value of $550,000, due two years from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 550,000 482,945
15% convertible debenture dated September 30, 2004, face value of $250,000, due two years from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $0.26 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 250,000 176,712
12
--------------------------------------------------------------------------------
COLLECTIBLE CONCEPTS GROUP, INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of November 30, 2006
(Unaudited)
NOTE C - CONVERTIBLE SECURED DEBENTURES (continued)
November 30,
2006 February 28, 2006
10% convertible debenture dated May 18, 2005, face value of $400,000, due three years from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $0.16 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) $ 204,932 $ 104,475
10% convertible debenture dated July 7, 2005, face value of $850,000, due three years from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $0.16 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 396,667 183,196
2% convertible debenture dated September 29, 2005, face value of $302,597, due three years from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $0.16 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 117,999 42,004
10% convertible debenture dated January 20, 2006, face value of $400,000, due three years from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $0.16 (See Note F) or b) 20% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 114,703 14,247
8% convertible debenture dated March 23, 2006, face value of $400,000, due three years from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $3.00 (See Note F) or b) 20% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) $ 92,055 $ -
13
--------------------------------------------------------------------------------
COLLECTIBLE CONCEPTS GROUP, INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of November 30, 2006
(Unaudited)
NOTE C - CONVERTIBLE SECURED DEBENTURES (continued)
November 30,
2006 February 28, 2006
8% convertible debenture dated May 31, 2006, face value of $500,000, due three years from date of the note with interest payable per annum. The note is convertible into the Company’s common stock at the lower of a) $3.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for twenty days before, but not including, conversion date. The Company granted the note holder a security interest in substantially all of the Company’s assets and intellectual property. Additionally, the note holder has certain registration rights. The Company is in violation of the loan covenants (see below) 83,561 -0-
2,604,589 1,887,399
Less current portion 2,604,589 1,887,399
Long term portion $ -0- $ -0-
The Company entered into a Securities Purchase Agreement with accredited investors in May 2000 for the issuance of an aggregate of $400,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes was warrants to purchase 40,000 shares (See Note F) of the Company’s common stock at an exercise price of $20.00 (See Note F) for five years. The Convertible Notes accrue interest at 10% per annum, payable quarterly, and were due one year from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $4.00 (See Note F) or b) 25% of the current market value. The Company issued to the investors Convertible Notes of $400,000 in exchange for net proceeds of $400,000. As of November 30, 2006, the remaining balance of these debentures of $169,672 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on May 28, 2002 for the issuance of an aggregate of $75,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 1,500 shares (See Note F) of the Company’s common stock at an exercise price $0.50 (See Note F) for five years. The Convertible Notes accrue interest at 12% per annum and were due one year from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $75,000 in exchange for net proceeds of $75,000. As of November 30, 2006, the remaining balance of these debentures of $75,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on November 26, 2002 for the issuance of an aggregate of $250,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 5,000 shares (See Note F) of the Company’s common stock at an exercise price of $0.45 (See Note F) for five years. The Convertible Notes accrue interest at 15% per annum and were due one year from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $250,000 in exchange for net proceeds of $250,000. As of November 30, 2006, the remaining balance of these debentures of $250,000 is still unpaid and in default.
14
--------------------------------------------------------------------------------
COLLECTIBLE CONCEPTS GROUP, INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of November 30, 2006
(Unaudited)
NOTE C - CONVERTIBLE SECURED DEBENTURES (continued)
The Company entered into a Securities Purchase Agreement with accredited investors on May 15, 2003 for the issuance of an aggregate of $25,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 500 shares (See Note F) of the Company’s common stock at an exercise price of $0.40 (See Note F) for five years. The Convertible Notes accrue interest at 15% per annum and were due one year from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $25,000 in exchange for net proceeds of $25,000. As of November 30, 2006, the remaining balance of these debentures of $25,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on June 20, 2003 for the issuance of an aggregate of $25,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 500 shares (See Note F) of the Company’s common stock at an exercise price of $0.20 (See Note F) for five years. The Convertible Notes accrue interest at 15% per annum and were due one year from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $25,000 in exchange for net proceeds of $25,000. As of November 30, 2006, the remaining balance of these debentures of $25,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on July 23, 2003 for the issuance of an aggregate of $25,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 500 shares of the Company’s common stock at an exercise price of $0.10 (See Note F) for five years. The Convertible Notes accrue interest at 15% per annum and were due one year from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $25,000 in exchange for net proceeds of $25,000. As of November 30, 2006, the remaining balance of these debentures of $25,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on November 14, 2003 for the issuance of an aggregate of $50,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 1,000 shares (See Note F) of the Company’s common stock at an exercise price of $0.10 for five years. The Convertible Notes accrue interest at 15% per annum and were due one year from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $50,000 in exchange for net proceeds of $50,000. As of November 30, 2006, the remaining balance of these debentures of $50,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on January 13, 2004 for the issuance of an aggregate of $50,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 1,000 shares (See Note F) of the Company’s common stock at an exercise price of $0.10 (See Note F) for five years. The Convertible Notes accrue interest at 15% per annum and were due one year from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $50,000 in exchange for net proceeds of $50,000. As of November 30, 2006, the remaining balance of these debentures of $50,000 is still unpaid and in default.
15
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COLLECTIBLE CONCEPTS GROUP, INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of November 30, 2006
(Unaudited)
NOTE C - CONVERTIBLE SECURED DEBENTURES (continued)
The Company entered into a Securities Purchase Agreement with accredited investors on February 13, 2004 for the issuance of an aggregate of $25,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 500 shares (See Note F) of the Company’s common stock at an exercise price of $0.15 (See Note F) for five years. The Convertible Notes accrue interest at 15% per annum and were due one year from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $25,000 in exchange for net proceeds of $25,000. As of November 30, 2006, the remaining balance of these debentures of $25,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on March 16, 2004 for the issuance of an aggregate of $100,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 2,000 shares (See Note F) of the Company’s common stock at an exercise price of $0.15 (See Note F) for five years. The Convertible Notes accrue interest at 15% per annum and were due one year from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $100,000 in exchange for net proceeds of $100,000. As of November 30, 2006, the remaining balance of these debentures of $100,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on May 28, 2004 for the issuance of an aggregate of $550,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 16,500 shares (See Note F) of the Company’s common stock at an exercise price of $3.00 for seven years. The Convertible Notes accrue interest at 15% per annum and were due two years from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $1.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $550,000 in exchange for net proceeds of $550,000. As of November 30, 2006, the remaining balance of these debentures of $550,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on September 30, 2004 for the issuance of an aggregate of $250,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 12,500 shares (See Note F) of the Company’s common stock at an exercise price of $3.00 for seven years. The Convertible Notes accrue interest at 15% per annum and were due two years from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $0.26 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $250,000 in exchange for net proceeds of $250,000. As of November 30, 2006, the remaining balance of these debentures of $250,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on May 18, 2005 for the issuance of an aggregate of $400,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 473,684 shares (See Note F) of the Company’s common stock at an exercise price of $0.16 (See Note F) for five years. The Convertible Notes accrue interest at 10% per annum (current default rate of 15%) and were due three years from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $0.16 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $400,000 in exchange for net proceeds of $400,000. As of November 30, 2006, the remaining balance of these debentures of $400,000 is still unpaid and in default.
16
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COLLECTIBLE CONCEPTS GROUP, INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of November 30, 2006
(Unaudited)
NOTE C - CONVERTIBLE SECURED DEBENTURES (continued)
The Company entered into a Securities Purchase Agreement with accredited investors on July 7, 2005 for the issuance of an aggregate of $850,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 17,000 shares (See Note F) of the Company’s common stock at an exercise price of $0.16 (See Note F) for five years. The Convertible Notes accrue interest at 10% per annum (current default rate of 15%) and were due three years from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $0.16 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $850,000 in exchange for net proceeds of $850,000. As of November 30, 2006, the remaining balance of these debentures of $850,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on September 29, 2005 for the issuance of an aggregate of $302,597 of convertible notes (“Convertible Notes”) in exchange for accrued interest due said accredited investors. The Convertible Notes accrue interest at 2% per annum and were due three years from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $0.16 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $302,597 in exchange for net proceeds of $302,597. As of November 30, 2006, the remaining balance of these debentures of $302,597 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on January 20, 2006 for the issuance of an aggregate of $400,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 4,000 shares (See Note F) of the Company’s common stock at an exercise price of $0.20 (See Note F) for five years. The Convertible Notes accrue interest at 10% per annum and were due three years from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $0.16 (See Note F) or b) 20% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $400,000 in exchange for net proceeds of $400,000. As of November 30, 2006, the remaining balance of these debentures of $400,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on March 23, 2006 for the issuance of an aggregate of $400,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 1,000,000 shares (See Note F) of the Company’s common stock at an exercise price of $0.50 (See Note F) for seven years. The Convertible Notes accrue interest at 8% per annum and were due three years from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $3.00 (See Note F) or b) 20% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $400,000 in exchange for net proceeds of $400,000. As of November 30, 2006, the remaining balance of these debentures of $400,000 is still unpaid and in default.
The Company entered into a Securities Purchase Agreement with accredited investors on May 31, 2006 for the issuance of an aggregate of $500,000 of convertible notes (“Convertible Notes”) and attached to the Convertible Notes were warrants to purchase 1,000,000 shares (See Note F) of the Company’s common stock at an exercise price of $0.50 (See Note F) for seven years. The Convertible Notes accrue interest at 8% per annum and were due three years from the date of the note. The note holder has the option to convert any unpaid note principal to the Company’s common stock at a rate of the lower of a) $3.00 (See Note F) or b) 25% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before, but not including, conversion date. The Company issued to the investors Convertible Notes of $500,000 in exchange for net proceeds of $500,000. As of November 30, 2006, the remaining balance of these debentures of $500,000 is still unpaid and in default.
Due to the indeterminate number of shares which might be issued under the embedded convertible host debt conversion feature of these debentures, the Company is required to record a liability relating to both the detachable warrants and embedded convertible feature of the notes payable (included in the liabilities as a “derivative liability”).
The accompanying financial statements comply with current requirements relating to warrants and embedded derivatives as described in FAS 133 as follows:
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COLLECTIBLE CONCEPTS GROUP, INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of November 30, 2006
(Unaudited)
NOTE C - CONVERTIBLE SECURED DEBENTURES (continued)
· The Company treats the full fair market value of the derivative and warrant liability on the convertible secured debentures as a discount on the debentures (limited to their face value). The excess, if any, is recorded as an increase in the derivative liability and warrant liability with a corresponding increase in Loss on adjustment of the derivative and warrant liability to fair value.
· Subsequent to the initial recording, the change in the fair value of the detachable warrants, determined under the Black-Scholes option pricing formula and the change in the fair value of the embedded derivative (utilizing the Black-Scholes option pricing formula) in the conversion feature of the convertible debentures are recorded as adjustments to the liabilities as of each balance sheet date with a corresponding change in Loss on adjustment of the derivative and warrant liability to fair value.
· The expense relating to the change in the fair value of the Company’s stock reflected in the change in the fair value of the warrants and derivatives (noted above) is included in other income in the accompanying consolidated statements of operations.
The following table summarizes the various components of the convertible debentures as of November 30, 2006 and February 28, 2006:
November 30,
2006 February 28,
2006
Convertible debentures described above (net of conversions) $ 4,447,269 $ 3,636,417
Less: discount (1,842,680 ) (1,749,018 )
Convertible debentures as reported $ 2,604,589 $ 1,887,399
NOTE D - CONVERTIBLE SUBORDINATED DEBENTURES
Convertible subordinated debentures as of November 30, 2006 and February 28, 2006 are as follows:
November 30,
2006 February 28, 2006
12% convertible debenture, unsecured with a maturity of August 2001. The debenture is convertible into the Company’s common stock at $5.00 (See Note F) per share. The note is currently in default. $ - $ 40,000
12% convertible debenture, unsecured with a maturity at August 2001. The debenture is convertible into the Company’s common stock at $7.50 (See Note F) per share. The note is currently in default. - 31,800
12% convertible debenture, unsecured with an original one year maturity at May 2004. The debenture is convertible into the Company’s common stock at $4.00 (See Note F) or 50% of the average of the lowest three intraday trading prices during the twenty trading days immediately preceding conversion. The note is currently in default 34,500 55,500
Total 34,500 127,300
Less: current portion (34,500 ) (127,300 )
Long term debt $ - $ -
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COLLECTIBLE CONCEPTS GROUP, INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of November 30, 2006
(Unaudited)
NOTE E - LOAN AGREEMENTS
The Company entered into an agreement with an individual investor whereby the investor agreed to provide up to $750,000 with an interest rate of 18% per annum, payable annually, maturing one year from each draw. The Company, at its option can repay the debt in cash or may elect to convert any of the loans into shares of its common stock at 75% of the closing bid of the previous day. As of November 30, 2006, the Company has borrowed $536,500, net, from this facility which is included in notes and loans payable.
NOTE F - CAPITAL STOCK
Series A - Convertible Preferred Stock
On September 4, 2006, the Company filed a Certificate of Designation creating a $0.001 par value Series A Convertible Preferred Stock for 1,000,000 shares.
The holders of record of the Series A Convertible Preferred stock shall have the right, at their option, at any time subsequent to the date on which the Closing Bid Price of the Company’s common stock is at least $0.05 (See Note F), to convert any or all of such holder’s shares of Series A Convertible Preferred stock into such number of fully paid and non-assessable shares of the Company’s common stock equal to the number of shares of Series A - Convertible Preferred stock multiplied by 20 (See Note F).
The holders of the Series shall have the right to vote, separately, in person or by proxy, at a special or annual meeting of the shareholders, on all matters voted on by the holders of the Common Stock voting together as a single class with other shares entitled to vote. With respect to any such vote, each share of Series A Preferred Stock shall entitle the holder at cast 60 (See Note F) votes per share of Series A Preferred stock.
The Series A Preferred Stock shall, with respect to distributions of assets and rights upon the occurrence of a Liquidation rank (i) senior to all classes of common stock of the Company and (ii) senior to each other class of Capital Stock of the Company hereafter created with does not expressly rank pari passu or senior to the Series A Preferred Stock.
The Series A Preferred Stock shall not be redeemed or subject to redemption, whether by option of the Company or any holder thereof, or otherwise.
The holders of record of the Series A Convertible Preferred shall be entitled to share in any cash dividends or distributions that my be declared and paid on the Common Stock on a pro rata basis as if the holders had been converted into shares of Common Stock.
