Spoke:
Looks to me that the debentures are not floorless:
The holders appear to receive the value of their investment (less 30%) in shares at the current price when the registration is effective + 200%.
For example:
$6,000,000 + 30%
= $7,800,000 divided by .16 = 48,750,000
+ 200% of the share balance
= 146,250,000 shares.
Registered" is a number of shares of Common Stock which is at least
equal to (A) the number of shares theretofore issued on conversion of
the Debentures (including any interest paid on conversion by the
issuance of Conversion Shares) and on exercise of the Warrants, plus
(B) the sum of (x) two hundred percent (200%) of the number of shares
into which the unconverted Debentures and all interest thereon through
their respective Maturity Dates would be convertible at the time of
filing of such Registration Statement or amendment (assuming for such
purposes that all Debentures, reduced by any previously converted
Debentures, had been issued, had been eligible to be converted, and had
been converted, into Conversion Shares in accordance with their terms,
whether or not such issuance, eligibility, accrual of interest or
conversion had in fact occurred as of such date) based on the
Conversion Price in effect on, or within three (3) Trading Days prior
to, the date the amendment to the Registration Statement is filed, (y)
the number of Warrant Shares covered by the unexercised Warrants
(assuming for such purposes that all the Warrants, including Additional
Warrants, reduced by any exercised Warrants, had been issued, had been
eligible to be exercised and had been exercised for the issuance of
Warrant Shares in accordance with their terms, whether or not such
issuance, eligibility or exercise had in fact occurred as of such
date), (z) the number of Other Issuable Shares as of the date of the
filing of the Registration Statement or any amendment thereto
(provided, however, that for purposes of this provision, the number of
Other Issuable Shares shall not be greater than the number of such
shares which the SEC permits to be included in the Registration
Statement), or
(Y) if such Registration Statement has been declared effective by the
SEC at that time, file with the SEC an additional Registration
Statement (an "Additional Registration Statement") to register the
number of shares equal to the excess of the Increased Number of Shares
to Be Registered (where the number of shares determined by clause (x)
is based on the Conversion Price in effect on, or within three (3)
Trading Days prior to, the date the additional Registration Statement
(or any amendment thereto) is filed, over the aggregate number of
shares of Common Stock already registered.
The Company will use its reasonable best efforts to cause such Registration
Statement to be declared effective on a date (each, an "Increased Required
Effective Date") which is no later than (q) with respect to a Registration
Statement under clause (X) of this subparagraph (iii), the Initial Required
Effective Date and (r) with respect to an Additional Registration Statement, the
earlier of (I) five (5) days after notice by the SEC that it may be declared
effective or (II) thirty (30) days after the Increased Registered Shares Date.
AI
