don't follow them doc but getting rid of YA should help
LIQUIDITY AND CAPITAL RESOURCES
The Company's continuing operating activities used $658,014 of cash in 2008 as compared to $559,341 cash used in 2007. The Company's capital requirements consist of general working capital needs and planned capital expenditures. The Company's capital resources consist primarily of cash generated from investing activities.
The Company had been unable to secure the financing necessary to expand its current operations. Potential sources of financing have been deterred by the large amount of convertible debt that the Company has issued to YA Global Investments and others. The proceeds from the sale to Triumvirate were used, in part, to eliminate all of that convertible debt. Following the closing of the Purchase Agreement, we remain a public company listed on the OTC Bulletin Board. This situation will enable the Company to initiate new business operations without the burden of debt from past operations
Non-cash adjustments for continuing operations recorded for the six months ended June 30, 2008 totaled $1,654,588 and consisted of $50,426 in stock based compensation, $2,964,484 amortization of debt discount, $31,011 in deferred taxes, $140,000 stock based fees, ($2,920,000) change in derivative liabilities, and $1,388,667 cost of reduction of guarantee. Net cash flows of $962,795 from discontinued operations have been excluded from the above.
Accounts payable for continuing operations at June 30, 2008 totaled $78,050, an increase of $32,018 from the December 31, 2007 balance of $46,032. Accounts payable of $1,824,860 and $1,854,585 for the six months ended June 30, 2008 and 2007 from operations to be disposed of have been excluded from these numbers.
Accrued expenses for continuing operations at June 30, 2008 totaled $156,921, a decrease of $189,996 from the December 31, 2007 balance of $346,917. Accrued expenses as of December 31, 2007 included $286,000 of stock based compensation. Accrued expenses of $410,932 and $445,139 for the six months ended June 30, 2008 and 2007 from operations to be disposed of have been excluded from these numbers.
Net of discontinued operations, the Company had a positive working capital position of $1,503,515 as of June 30, 2008 as compared to a negative working capital position of $608,527 as of June 30, 2007.
AI
