In response to the recent posts about Livingston's debt conversions to shares here's what I gleaned from ENZC docs during my DD 18 months ago. This is JMHO and others may disagree:
The debt to Livingston was converted to 562,996,700 shares beginning September 2018 and ending on April 13, 2020, per the 12/31/2020 Disclosure Statement. The debt was converted at $.0001 on each conversion date. The settlement also granted Livingston an interest bearing $100,000 note, which was converted to shares on 3 dates in June, 3 dates in July with the last on August 20, 2020, resulting in an additional 545,884,150 shares according to my calculations derived from the Disclosure (Page 6 of 15). All of these shares are included in the 2,797,935,953 shares outstanding at 12/31/20. You can tell which debt was converted by reviewing the "Reason for Share Issuance" column (3rd from the right). Each conversion is described as either a "3(a)(10) conversion" (the settlement) or a "debt conversion" (the $100K note plus interest).
So, assuming the Disclosure is accurate (I have no reason to believe it isn't.), all of old ENZC's debts to Livingston were settled prior to the 2020 merger between old ENZC and BioClonetics.
Again, this is JMHO: Given the 9.99% ownership limitation... AT ANY ONE TIME...it's probable that Livingston had to sell these shares (those in excess of the 9.99% limitation) almost immediately after each conversion or they would have risked breaching the settlement terms. So, that brings up the question of whether they did meet the settlement terms and if not, whether ENZC would have a remedy. The other obvious question is whether the settlement was fair, but that is most likely beyond ENZC's legal remedies unless the SEC or DOJ (or some other agency) is looking at Livingston as part of their toxic lender investigations that were recently announced. (We can always hope.)
As I recall, the settlement was for a specific number of shares but the conversion rate for the $100K note was based on a formula to be calculated separately for each conversion date. This is where I begin to question the number of shares converted, but I don't have access to the daily lows for June-August, 2020. However, from the data on public sources, it looks like the price of ENZC's stock was rising and was frequently around $.0004 during that time frame.
According to the Disclosure, $.0001 was used on the entire note conversion like the 3(a)(10) conversion. The $.0001 may be the correct conversion rate, but it is also possible $.0001 was used by mistake or expediency. There is another possibly as well. It would seem that in the case of a thinly traded stock, the rate calculation can be manipulated with stock sales timed to maintain the $.0001 in the calculation. If that were to happen a note holder could receive an excessive number of shares, possibly into the hundreds of millions. I think this needs to be reviewed.
FWIW and JMHO. Please do your own DD.
