When SWVC falls below 0.005 , the 4 new CD's turn toxic.
And, yesterday we hit the 0.008's .
As we approach $0.005 , short term traders will sell all,
and the price will quickly drop below $0.005 ,
and the toxic trap door, in Paragraph 3.3 of the new loan,
will swing wide open, according to our advisors.
Here it is. What do you think?
" 3. Prepayment Obligation. Notwithstanding (i) the option of the Company to prepay any portion of this Note, or (ii) the obligation of the Company to prepay the Six Month Prepayment, as set forth in Section 2 hereof, the Company shall prepay, on a monthly basis, on any date of such month during which this Note remains outstanding (such date referred to herein as the "Periodic Prepayment Date"), an amount equal to Five Hundred Thousand Dollars ($500,000.00) (or such lesser amount that equals the remaining outstanding principal and accrued and unpaid interest under this Note), until all principal and accrued and unpaid interest under this Note has been paid, subject to the satisfaction of each of the following conditions on each Periodic Prepayment Date: "
" 3.1 The Company may immediately sell all of the Common Stock Issued at Conversion (as defined in the Debenture) pursuant to Rule 144 promulgated by the SEC (as defined in the Debenture) pursuant to the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC having substantially the same effect as such Rule; "
" 3.2 No Event of Default (as defined in the Debenture) has occurred under the Debenture; "
" 3.3 The average Volume Weighted Average Price (as defined in the Debenture) for the ten Trading Days (as defined in the Debenture) immediately preceding the Periodic Prepayment Date is NOT LESS THAN $0.005 PER SHARE (as adjusted for any stock splits, stock dividends, combinations, subdivisions, recapitalizations or the like); and "
" 3.4 The Lender shall have honored all Conversion Notices (as defined in the Debenture) submitted by the Holder (as defined in the Debenture) within the applicable time period set forth in the Debenture. "
As we read it, when SWVC hits $0.005 , the bottom drops out,
and the price crashes, until $500,000 "worth" of new shares
are sold, as fast as possible, no matter how low the price
is driven down. That's how toxic CD's work.
And Tom recently signed up for 4 of them. And, I am NOT
talking about the Wells Fargo Inventory Financing.
To us, the tip-off will be if Tom spends more SWVC cash,
to buy another private company, that he personally owns.
If so, watch out below.
Averaging-down is profitable, for shorters, only.
