$SFOR-What Company use it's only Patent AS COLLATERAL for TOXIC DEBT. Conman Mark Kay does. No wonder this POS is headed back to triple zeros, no bid then REVERSE SPLIT.. Unreal..
At March 31, 2016, $542,588 in aggregate principal amount of the DART/Citco Global debentures was issued and outstanding and are secured through the note holder's claim on the Company's intellectual property. The secured convertible debentures are past maturity. Due to the adjustable conversion price feature of the secured convertible debentures, our obligation to issue shares upon conversion of the secured convertible debentures owed to DART is potentially limitless. DART did not process any conversions in fiscal 2016 or 2015, and the Company has been in contact with the note holder who has indicated that it has no present intention of exercising its right to convert the debentures into shares of the Company's common stock. In connection with the secured convertible debentures with DART/Citco Global, we granted DART/Citco Global a secured interest in all of our assets. Under the terms of the secured debentures, we are restricted in our ability to issue additional securities as long as any portion of the principal or interest on the secured debentures remains outstanding. During 2016 or 2015, we did not obtain DART/Citco Global's written consent related to any of our financing agreements.
(b)
Convertible notes payable consisted of fourteen unsecured convertible notes ranging in interest rates of 0% per annum to 18% per annum. The notes are convertible at a fixed amount into 14 shares of the Company's common stock, at fixed per share amounts ranging from $1,950,000 to $9,750,000,000 per share, as defined in the agreements. The notes were due in various dates through 2015 and are all currently in default. The Company is currently pursuing settlements with certain of the holders.
At December 31, 2015, the balance of the accrued interest on the unsecured convertible notes with fixed conversion features was $932,272. During the interim period ended March 31, 2016, interest expense of $20,082 was recorded, and at March 31, 2016, the balance of accrued interest on unsecured convertible notes with fixed conversion features was $954,352.
(c)
The Notes are convertible into shares of Common Stock of the Company at the option of the holder commencing on various dates following the issuance date of the Notes and ending on the later of the maturity date or date of full payment of principal and interest. The principal amount of the note along with, at the holder's option, any unpaid interest and penalties, is convertible at a price per share discount of 40% of the Company's Common Stock trading market price during a certain time period, as defined in the agreement. In addition, the conversion price is subject to adjustment in certain events, such as in conjunction with any sale, conveyance or disposition of all or substantially all of the Company's assets or consummation of a transaction or series of related transactions in which the Company is not the surviving entity. The Company considered the current FASB guidance of "Contracts in Entity's Own Stock" and determined that the conversion prices of the Notes were not a fixed amount because they were subject to an adjustment based on the occurrence of future offerings or events and accounted for as derivative liability upon issuance in prior periods (see Note 7).
At December 31, 2015, the balance of the unsecured convertible notes with adjustable conversion features was $824,861. During the interim period ended March 31, 2016, the Company repaid a total of $613,351 of unsecured convertible notes principal. In addition, note holders converted an aggregate of $143,123 of unsecured convertible note principal. At March 31, 2016, the balance of unsecured convertible notes with adjustable conversion features was $68,387 and pertains to one unsecured convertible note which was repaid in April 2016.
Just cause you got the monkey off your back doesn't mean the circus has left town.
