A year ago, we would have all been surprised to be near 4 BILLION shares right now. You see, 6 million in cash is deceiving. It was not from operations, only from GZFX selling shares to market and Golden Gate toxic funding.
Scenario: They ask GG for more money. Then GG has to sell immediately because they can only hold 9.9%. We do not have enough Authorized to cover it as it stands now.
They have to anticipate enough Authorized to cover the conversion schedule below. And the magic line will always be " we do not plan to use the A/S " Then why ask for them?
So more shares are needed. And it will be high so they do not have to ask often, imho.
You better hope CC and AAFES news comes before this time.
If not, the GG conversion schedule is as follows:
(Never forget that management was not intelligent enough to take out the line that Golden Gate can SHORT SELL GZFX). This is how we are played. A message board has nothing to do with it. Golden Gate and GZFX selling shares control the stock price. Especially with no news.
(g) Adjustable Conversion Price Feature of Debentures Could Require the Issuance of Greater Number of Shares.
The Company's obligation to issue shares upon conversion of the convertible debentures to Golden Gate Investors, Inc. (see Liquidity and Capital Resources, below) is essentially limitless. The following is an example of the amount of shares of GameZnFlix common stock that are issuable upon conversion of the convertible debentures (excluding accrued interest), based on market prices 25%, 50% and 75% below the market price as of November 10, 2005 of approximately $0.01:
Number % of
% Below Price Per With Discount of Shares Outstanding
Market Share at 18% Issuable Stock
25% $0.0075 $0.0060 2,735,000,000 73.90%
50% $0.0050 $0.0040 4,110,000,000 80.97%
75% $0.0025 $0.0020 8,235,000,000 89.50%
As illustrated, the number of shares of common stock issuable upon conversion of the convertible debentures will increase if the market price of the stock declines, which will cause dilution to the existing stockholders.
(h) Adjustable Conversion Price Feature of Debentures May Encourage Short Sales.
The convertible debentures issued to Golden Gate Investors, Inc. are convertible into shares of Company common stock at an 18% discount to the trading price of the common stock prior to the conversion. The significant downward pressure on the price of the common stock as the selling stockholder converts and sells material amounts of common stock could encourage short sales by investors. This could place further downward pressure on the price of the common stock. The selling stockholder could sell common stock into the market in anticipation of covering the short sale by converting their securities, which could cause the further downward pressure on the stock price. In addition, not only the sale of shares issued upon conversion or exercise of debentures, warrants and options, but also the mere perception that these sales could occur, may adversely affect the market price of the common stock.
