Aero Performance Products Inc (fka AERP)

[Ineedmoreshares]

200Million+ Escrow Shares unaccounted for.

Copy and paste before Im booted for good. I posted a link to this yesterday but it was removed. I had it sneaked into my NIPI box, but it's gone now. Sorry to bring this but Im still long FCCN/AERO and believe in the new management and product.


ARE "200 MILLION +" FCCN Escrow shares MISSING?

DO NOT PANIC. THIS DOES NOT EFFECT AERO FUNDAMENTALS. ACCORDING TO SEC DOCUMENT ANALYSIS, AT LEAST 200,000,000 SHARES OF FCCN STOCK WHICH WERE ALLEGEDLY TRANSFERRED TO GGI, ARE NOT ACCOUNTED FOR. IMO, THE 8K IS BEING DELAYED BECAUSE OF THIS ISSUE.

I need to get this information public in order to be fair to all those who may have been influenced to buy or hold FCCN based upon what I have written.

THERE MAY BE OVER 200 MILLION SHARES GONE MISSING FROM THE GGI ESCROW ACCOUNT ACCORDING TO SEC FILINGS UP TO AND INCLUDING
THE 10.01.07 "10K".

PERHAPS THE 8K WILL EXPLAIN WHERE THEY WENT. IT WAS "SUGGESTED" (TRIAL BALLOON STYLE) TO ME THAT THE "EXTRA" SHARES WERE GIVEN TO GGI "TO GET RID OF THEM" BUT THAT WOULD SEE GGI GETTING 10 TIMES MORE SHARES TO DUMP THAN THE CONVERSION FORMULA CALLED FOR SO I DONT BELIEVE IT.

GIVING THEM 10 TIMES THE SHARES THEY WERE DUE MAKES NO SENSE. IT JUST WORSENS THE SITUATION AS TO GGI.

From the 10.01.07 "10K":

"In November 2006, the Company agreed to settle litigation with Golden Gate Investors on a past-due convertible debenture having a principle balance due of $220,927. Under the terms of the settlement, the Company placed 843,818,400 shares of its restricted common stock into an escrow account for satisfaction of the debenture. Golden Gate is allowed to withdraw the shares from escrow provided that their overall holdings in the Company do not exceed 4.9% of all issued and outstanding common stock. The debenture obligation is reduced by 80% of the average of the five lowest closing bid prices of the Company’s common stock over a 45-day period prior to the share withdrawal multiplied by the number of shares being withdrawn. As of September 25, 2007, under the terms of this settlement, 400,287,345 shares have subsequently been released from escrow and the debenture balance has been reduced to $35,694."


843,818,400 - 400,287,345 = 443,531,055

443,531,055 - 400,000,000(RETIRED SHARES) = 43,531,055

The five lowest lows of the day for the period stated in the formula were:

.009 + .009 + .009 + .01 +.01 = .047

.047/5 = .0094

.0094 x .8 = .00752

.00752 x 4,746,542 = $35,694

But according to the 10K 43,531,055 shares were given to GGI to finish off the debenture NOT 4,746,542.

43,531,055 - 4,746,542 = 38,784,513 shares not accounted for.

The GGI debenture update and formula listed in the June 7, 2007 10K must provide an accurate conversion for all shares drawn down from escrow for time period discussed in the June 7, 2007 "10K" through the October 1, 2007 "10K". Look at the June 7th 10K and do the math...

From 06.07.07 10K:

The debenture obligation is reduced by 80% of the average of the five lowest closing bid prices of the Company’s common stock over a 90-day period prior to the share withdrawal multiplied by the number of shares being withdrawn. Under the terms of this settlement, as of May 23, 2007, 227,267,345 shares have subsequently been released from escrow and the debenture balance has been reduced to $92,854.

So this one traces the multiple back "90 days", while the October 1st "10K" only traces it back 45 days. I will do the math using both sets of numbers.

From the June 7, 2007 "10k":

"Under the terms of this settlement, as of May 23, 2007, 227,267,345 shares have subsequently been released from escrow and the debenture balance has been reduced to $92,854."

843,818,400 - 400,000,000 (retired shares) = 443,818,400 total shares "allegedly" given to GGI

443,818,400 - 227,267,345 = 216,551,055

The most recent numbers from the October 1st "10k" are:

843,818,400 - 400,287,345 = 443,531,055 - 400,000,000 = 43,531,055

According to the last "10K", 43,531,055 remained and this is the number you have "suggested" was subject to the alleged settlement agreement.

So, between the last two 10K filings, 173,020,000 shares were drawn down by GGI using the formula listed in both 10K filings:

216,551,055 - 43,531,055 = 173,020,000

Now for the amount of monetary debt.

$92,854 - $35,694 = $57,160

So, using the conversion formula $57,160 should convert to 173,020,000 shares.

The only difference in the formula between the two 10Ks was the number of days GGI could reach back to get the conversion multiple numbers.

10.01.07 10K = 45 days
06.07.07 10K = 90days

I will do a conversion using both sets of numbers.

.009 + .01 + .01 + .01 + .01 = .049

.049/5 = .0098

.0098 x .8 = .00784

.00784 x 173,020,000 = $1,356,476

$1,356,476 obviously does not equal $57,160

45 DAY CONVERSION

Going back 45 days from May 23, 2007, the five lowest lows of the day were:

.01 + .01 + .01 + .01 + .01 = .05

.05/5 = .01

.01 x .8 = .008

.008 x 173,020,000 = $1,384,160

$1,384,160 also does not equal $57,160.

$1,356,476 - $57,160 = $1,299,316

$1,299,316/.00784 = 165,729,081 shares

165,729,081 shares missing for this time period.

165,729,081 + 38,784,513 = 204,513,594

204,513,594 SHARES MISSING FROM THE GGI ESCROW FOR THE TIME PERIOD FORM MAY 2007 TO THE PRESENT.

I don't know how many shares might be missing for the time period before May, 2007.

If there was some kind of "deal" made here, it was not a "settlement" at all.

There are only three plausible scenarios I can see:

SCENARIO #1: AERO drew down shares from the Escrow account.

But the following wording of the "Subsequent Events" section of the last 10K trips this theory up:

"Subsequent to June 30, 2007, an additional 126,600,000 shares of the Company’s common stock was released from escrow to Golden Gate Investors under the terms of the Settlement Agreement, bringing the total amount of shares released to Golden Gate to 400,287,345, with a balance on the debenture to convert of $35,694."

If 443 million shares were "released to" GGI, AERO was not a second beneficiary of the escrow, certainly not directly anyway.

I originally thought that has been the case. But it appears I was wrong.

SCENARIO #2

The Escrow agreement between GGI and FCCN included a clause where GGI acted as custodian for hundreds of millions of shares from the escrow which were exchanged for AERO stock at the close of the deal.

This option is highly unlikely. But it would be great if they worked it out this way.

SCENARIO #3

Something sinister happened.

I'm not saying hundreds of millions of shares were embezzled from the Escrow account, I'm just saying the numbers just don't add up.

If scenario #3 is real, there could be a shareholder lawsuit and full complaint filed with the SEC.

165,729,081 + 38,784,513 = 204,513,594 shares MISSING...

ALL OF THE SEC FILINGS INDICATE THAT THESE SHARES ARE NOT ACCOUNTED FOR BY USING THE CONVERSION FORMULAS LISTED ON THE LAST TWO 10k FILINGS.

the original formula shown below was also suggested to me by a friend of the stock (trial balloon style again) as containing the answers, but it doesn't work out with the last two 10k filings.

http://www.pinksheets.com/edgar/GetFilingHtml?FilingID=4909741

This formula was superseded by the ones testified to being used in the last few 10K filings with the SEC. The old formula has been obsolete for a long time.

SO THE QUESTION REMAINS, ARE THERE 200,000,000 OR MORE SHARES NOT ACCOUNTED FOR?

I don't think the stock has a chance of running unless these shares are properly accounted for.

Nothing in this analysis effects the fundamentals of AERO EXHAUST, it will actually result in a better PPS and a lower O/S once these shares are accounted for.

While many people would have sold their shares before posting this information, I have held mine because I do NOT want to profit from this. I AM LONG FCCN/AERO and have not sold one share. And I can prove it. Current pps is .0145 12:52 PM as I write this.

Everyone knows I'm long FCCN/AERO. Look at my posting history.

Very Truly Yours,

INMS