QuantGate Systems Inc. (QGSI)

[Potse]

Share increase....probably reflects a conversion of the preferred......

My assumption (based on running the numbers) is that the outstanding share increase is most likely an indication that Debra Swain and Marsha Collins have converted all of their preferred shares into common shares. The 246,697,500 share increase exactly matches what the 9.25M preferred were convertible to (1 preferred for 26.67 common).

However, the conversion ratio I provided above was from May 2019 and does not reflect the 1:5 reverse split that occurred subsequently. So I think an error has been made here. If the sisters did in fact convert the preferred, the actual outstanding count should be 84,223,797. The correct ratio should be 1 preferred for 5.334 common.

Preferred share conversion ratios are always adjusted accordingly with any stock split. I am unaware of any situation in the past where I have not seen the preferred ratios get adjusted. So I will be extremely surprised (unpleasantly surprised) if we don't see the company adjust/correct the share count.

If the sisters did convert their preferred, this could start to get a bit more interesting. It probably increases the chances that we might see some pretty big blocks of shares exchange hands and perhaps see some new people/institutions get involved with the stock/company.