YesDTC Holdings, Inc.(fka YESD)

[kidnova]

And what is this all about? Why not just file the registration statement and avoid the penalty? Is this laziness or was it done on purpose?

Under the terms of the notes, we were required to file a registration statement to register the shares of common stock underlying the notes and the warrants no later than 180 days from the closing of the offering and to have such registration statement declared effective no later than 365 days from the closing of the offering. We have not filed the required registration statement and as a result (i) the exercise price of the warrants has been reduced to $0.05 per share and (ii) each subscriber is entitled to liquidated damages equal to 1% of the aggregate purchase price paid by such subscriber for the notes and warrants for each month that the Company does not file the registration statement or cause it to be declared effective. At December 31, 2010, we have recorded a charge of $12,000 related to accrual of the liquidated damages due to the holders.