Paychest Inc (PYCT)

[poopscooper]

for6 years many were confused where all the 0001 were coming from now many are confused where all the 00005 under 0001 are coming from.

Look at the Rich Capital deal for clues...lol
$$600K invoice for services for Rich Capital...What they do for 600K?
Creative accounting? Creative Bill?




On or after September 1, 2012 the recipient can convert payments due into common shares at 75% of the market price at that time. The maturity date of the Note is September 1,2015.

It was for services (not cash, as some here claimed), check out 'long term liabilities (non-current)' up from 5,000,000 to 5,600,000.
On Sept 1,2011 it will change to 5,630,000 (simple interest of 30K). NO CASH HAS TO BE PAID THEN.
Sept 1,2012 $5,660,000; all the way to $5,750,000 on Sept 1,1015.At which time PYCT must pay (IF THEY ARE STILL IN EXISTENCE).
Anytime AFTER SEPT 1,2012 the recipient (RICH CAPITAL) can convert payments due 2012 (660K); 2013 (690K); 2014 (720K): 2015 (750K) into shares at a 25% discount to market. THE PREVIOUS STATEMENT IS CONTINGENT ON COMPANY REVENUE REACHING $3M.

WHY THE DEAL? Rich Capital, IMO, was set up for tax purposes (makes sense, corporate taxes are less than personal) for John Banks and Qian Yang (the names on the patents). Rich Capital gets nothing if PYCT goes bellyup. They get nothing until maturity date IF REVENUE DOES NOT REACH 3M.
I'm sure it was set up to protect PYCT from Rich Capital negotiating the patents with someone else (unless PYCT goes under). PYCTs backers put up the money for the manufacturing equipment.
Regarding a Reverse Split. It would not make sense for RC to convert (when Rev reaches 3M) prior to a Reverse Split. Using today's price(.0001 MCAP 2.2M) and a 1:1000 split, they would own 21% before (6B of 28B), they would then own 6M of the new issue (say 50M), they would own only 12% of the company. So, converting before a RS would not be beneficial to RC, so I can't see that happening soon. no benefit to PYCT in the near future.
MY OPINION....GOOD