Validian Corp fka VLDI

[Surwin]

Bruce has been doing everything within his power to survive without issuing more common stock or any convertible preferred, convertible debt, and/or convertible promissory notes. They have eliminated all stock based compensation from R&D and from selling expenses. They have managed much to my surprise to survive another quarter without issuing more common shares, senior convertible debt, convertible preferred, and/or convertible promissory notes.

It is pretty amazing that common shares outstanding did not change and remains at 688,287,060 from last qtr. and on a fully dilute basis they actually decrease the share count from 988,973,820 to 988,307,100 or by 666,720 shares. They did this buy cutting selling by $26K and and cutting R&D by $7K and reducing interest expense by $83K. They then bought back $20K worth of 10% convertible debt. They financed operation by issuing $50K worth of promissory notes at 12% interest without and common stock conversion feature and by increasing accounts payable by $100K.

To summarize they still only have about 11M shares of common left and will at some point have to increase authorized share count especially since they can't even cover all the conversion features on a fully diluted basis. They continue to cut expenses to the bone and have financed operation by increasing payables ( not paying vendors, and a vendor's bill is still in dispute from Q1) by $100K and financing $20K in promissory cash notes. At some point they will be no longer be able to cut expenses and all financing will dry up.

The revenue can is once again kick down the road to Q4.

We anticipate commercial sales during the fourth quarter of 2018, however we cannot be assured that this will be the case.

Like I have stated before VLDI is facing a slow death and I still am of the opinion that Next year will be the rinse and repeat especially if they can't make a deal in the last month and half of this year.