Tex, it is one thing for the loan notes holders to have their 'skin in the game' but another thing for them to literally take over the game. Take a look at this and tell me what you think:
EXTRACT FROM NOVEMBER 2009 8K:
"The amount of US$4,285,855.65 (Four million two hundred and eighty five thousand eight hundred and fifty five dollars and sixty five cents)owed to Loan Note Holders (as detailed in this Filing, plus accrued interest on these Loan Notes) and to other Creditors; will be required to be deducted from the proceeds of the sale of the Company’s interests in the two Gold Properties.
It is possible that the Company may be successful in settling part or all of the various outstanding Loan Notes into shares of the Company’s Stock. In this event, the amount of shares outstanding will be substantially increased; this could result in a reduced value per share of the Company’s Common Stock..."
EXTRACT FROM FEBRURARY 2010 8K:
"The Company is negotiating to convert the additional outstanding Loan Notes into restricted shares of the Company’s Common Stock. There is no guarantee that the Company will be successful in this endeavor..."
Now, LETS DO THE MATH:
If 5 Billion shares just got released at .0001 to cover US $500,000 debt. Then that leaves the owed amount at US $4,285,855 minus US $500,000 = US $3,785,855 approximately. If they release thapprox 38 Billion shares to cover this pending amount, that would put the total outstanding shares around the current 36 Billion plus this 38 Billion = 74 or 75 BILLION SHARES OUTSTANDING!!! DOES THAT NUMBER LOOK FAMILIAR TO ANYONE??!! It should look familar because that the the newly targeted AUTHORIZED SHARE AMOUNT!!! If the deal is worth US $100 Million, then this number will need to be divided by this potential OS of 75 Billion not 36 billion or so that currently stands. With that math, that give a DIVIDEND YIELD OF .001333 NOT .003333 (roughly) that we have all been looking at! In simple terms, if these so called loans notes all get converted to shares, these new holders will get US $49.5 Million ( 38 Billion x .001333 dividend = US $49.5M)of the possible US $100 Million deal...Considering that the original loans notes were no more than US $4.5 M, dont ya thing that a greater than US $49.5 M return is a bit much?!!!
NOTE: My numbers may be off but the general jist is all there...Thoughts?? I suggest asking Mr. Bezzano to stop this dilution would be a good start to doing something BUT im sure all this has been CAREFULLY thought out...BUT I guess .0013 is still better than 0.000nothing:)
-PD
