Greenshift Corporation (GERS)

[DiggR]

Apology not necessary, but accepted.

Lightbeam and I go way back. He and I know this stock inside and out. KK and Tommy Boy too. Everyone needs to be careful of the boiler room gang that P&D's with this one. It can be easy to get caught up in the hype. But that is all it is. Hype.

http://www.sec.gov/Archives/edgar/data/1269127/000126912709000142/0001269127-09-000142-index.htm

I read the 30 SEP 2009 Quarterly report, filed 24 NOV 2009. This appears to be the most recent. I see more of the same.

I am not sure where you are coming from when you say the company can not R/S at these levels. I believe they can, and actually may have to if they can not sell enough stock to bag holders at these levels (as the boiler room gang is working to acheive IMO).

DO NOT BE A BAG HOLDER!!! Trade, but do not invest in this stock. If you do not have a broker account where you can get in and out the same day, have real time L2, and know how to use these tools, you are fish food here. Eat or be eaten.

From the 30 SEP 2009 10-Q -

From Section 3) located on Page 11;

3 GOING CONCERN

The Company had a working capital deficit of $66,705,102 at September 30, 2009,
which includes convertible debentures and line of credit totaling $30,219,765,
accrued interest payable of $8,626,962, related party debt of $51,500, related
party convertible debentures of $5,219,438, and $3,979,437 in purchase
obligations. The Company's working capital deficit net of these amounts is
$18,608,000.

Despite their classification as current liabilities, current convertible
debentures, line of credit and accrued interest ($38,846,727) are not
serviceable out of the Company's cash flows (the terms of the convertible debt
require repayment in shares of either GreenShift Corporation or GS AgriFuels
Corporation common stock). The purchase obligations ($3,979,437), to the extent
due, are tied to the earnings of the Company's equipment sales business and can
only be serviced after the Company's senior secured debt has been serviced.


Management intends to raise capital from debt and equity transactions to fund
operations, to increase revenue and to cut expenses to reduce the loss from
operations. There can be no assurances that the Company will be able to
eliminate both its working capital deficit and its operating losses. The
accompanying financial statements do not contain any adjustments which may be
required as a result of this uncertainty.

What does this tell you? This tells me KK has suficiently separated his company from his stock holders. He is making payrol and paying bills to tread water at the expense of his stock holders.

FYI, "Management intends to raise capital from debt and equity transactions" = DILUTION

From section 5) located on Page 13 -

COMMON STOCK

The Company issued 623,077,763 shares of common stock upon the conversion of an
aggregate of $1,643,167 in debt during the nine months ended September 30, 2009,
consisting of: 149,955,247 common shares issued to YA Global Investments, LP
("YAGI") upon its conversion of debt and accrued interest in the amount of
$395,461; 296,532,508 common shares issued to Minority Interest Fund (II), LLC
("MIF") upon its conversion of debt in the amount of $877,479; 134,631,965
common shares issued to RAKJ Holdings, Inc. ("RAKJ") upon its conversion of debt
in the amount of $315,000; and, 41,958,043 common shares issued to Mammoth
Corporation upon its conversion of debt in the amount of $50,000. In addition,
527,400 common shares issued to an employee upon conversion of vested shares of
Series B Preferred Stock.

The only conditions under which the Company would be required to redeem its
convertible preferred stock for cash would be in the event of a liquidation of
the Company or in the event of a cash-out merger of the Company.


This further describes how KK has separated stockholders from company value. FYI; This means that the company increasing revenue does not mean the PPS will go up.

From Section 7 located on page 15 -

7 LINES OF CREDIT

Revolving Line of Credit for Construction of Corn Oil Extraction Facilities

On January 25, 2008, GS COES (Yorkville I), LLC, a subsidiary of the Company,
closed on the terms of a Credit Agreement with YA Global Investments, LP
("YAGI"). On July 1, 2008, the Credit Agreement was amended to extend the
commencement of payments to YAGI to October 1, 2008 and to extend all
performance timelines to December 31, 2008. On December 11, 2008, the Credit
Agreement was amended to extend the maturity date to January 31, 2011, to
increase the revolving availability to $13,750,000, and to restructure the
repayment provisions such that amounts advanced by YAGI would be repaid on the
closing of financing from CleanBioenergy Partners, LLC, an affiliate of GE
Energy Financial Services. The Credit Agreement was issued for the purpose of
constructing and installing corn oil extraction facilities based on the
Company's patented and patent-pending corn oil extraction technologies. While
the revolving availability under the line of credit was increased to $13,750,000
in the December 11, 2008 amendment, and the Company was otherwise in compliance
with the amended terms, the Company was unable to access the additional
availability. The principal balance on the line of credit was $10,000,000 as of
December 31, 2008, interest is accruing at the rate of 20% per annum, and the
line and accrued interest is payable at the maturity date. The December 11, 2008
amendment also added a term allowing YAGI to convert interest and principal into
common stock of the Company at a conversion price equal to the lesser of (a)
$1.25 or (b) 90% of the lowest daily volume weighted average price for the
twenty trading days preceding conversion. The Company is currently in
discussions with YAGI to restructure this line of credit since the
CleanBioenergy financing failed to close as expected.

The Company accounted for the YAGI line of credit dated January 25, 2008 in
accordance with ASC 480, Distinguishing Liabilities from Equity, as the
conversion feature embedded in the YAGI line of credit could result in the
principal being converted to a variable number of the Company's common shares.
The carrying amount of the line has been restated for the prior year (please see
Note 16 Restatements, below). The Company determined the value of the YAGI line
of credit at issuance to be $11,044,838 which represented the face value of the
principal plus the present value of the conversion feature. The liability for
the conversion feature shall increase from its present value of $1,044,838 at
issuance to its estimated settlement value of $1,111,111 at December 31, 2010.
For the nine months ended September 30, 2009, an expense of $66,273 has been
recorded as interest expense for the accretion of the present value discount on
the line of credit, thereby increasing the carrying value of the YAGI line of
credit to its estimated settlement value of $11,111,111 at September 30, 2009.

The Company issued six million shares of its common stock to YAGI valued at
$1,080,000, and GS COES paid structuring fees of $210,000, legal fees of
$150,000, monitoring fees of $175,000, due diligence fees of $35,000 as well as
prepaid interest of $250,000 in connection with the issuance of the revolving
line of credit described above. The balance of deferred financing fees was $0 at
September 30, 2009. The Company does not have any ratios or covenants in
conjunction with the YAGI debt. The Company is currently in default on the
agreements due to the failure of the GE transaction.
<TABLE>

KK calls it revolving lines of credit, but this is his piggy bank. The stockholders are his piggy bank. I described how YA/Yorkville/YAGI/Cornell work and how they are never bag holders themselves in a previous post.

I have bolded one of the most signaficant lines in this section, and the one that may force KK to R/S again, and soon. HE HAS TO KEEP HIS PIGGY BANK OPERATING.

The Company is currently in default on the (YAGI)
agreements due to the failure of the GE transaction.