Source: SEC. 8-K & DEFA.
"Under the RRA, the Company has committed to file a Registration Statement with the U.S. Securities and Exchange Commission within 90 days of this agreement, covering the shares to be sold under the DEFA."
- Will this be disclosed to the public when they file a RRA with the SEC?
- The dilution we've seen as of late was just for payed services an not yet for Auctus!
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"ARTICLE II Section 2.1 Advances. (b)
The Investor shall immediately cease selling any shares within the Drawdown Notice if the price falls below the Floor Price. The Company, in its sole and absolute discretion, may waive its right with respect to the Floor and allow the Investor to sell any shares below the Floor Price. Only when the closing bid price of the stock is above the Floor Price (the price at the time when the Investor must immediately cease selling shares) may the Investor reinitiate selling of any shares without such waiver from the Company required under this subsection."
- What is the use of a Floor price when the company can waive its right to alter the Fp?
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ARTICLE IV. Representations and Warranties of the Company.
"Section 4.24 Dilution. The Company is aware and acknowledges that issuance of shares of the Company’s Common Stock could cause dilution to existing shareholders and could significantly increase the outstanding number of shares of Common Stock."
- Those 62mil shares in the S-1 that was withdrawn was obviously not enough to get their 10mil financing deal with Auctus... Although when one does a rough calculation it should be around that amount of shares that they'll need to meet their goal.
The first time they'll need approx 15 mil, the second time 10-12mil, 3th time 8-10mil, and from then on the amount of shares needed should decline rapidly because the SP should be much higher by then.
Please note that the cascading dilution will only commence after the "Registration Rights Agreement" is filed with the SEC,
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Read also "ARTICLE VI. Covenants of the Company."
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"ARTICLE VII. Conditions for Advance and Conditions to Closing."
(g) Maximum Advance Amount.
"The amount of an Advance requested by the Company shall not exceed the Maximum Advance Amount. In addition, in no event shall the number of shares issuable to the Investor pursuant to an Advance cause the aggregate number of shares of Common Stock beneficially owned by the Investor and its affiliates to exceed four and 99/100 percent (4.99%) of the then outstanding Common Stock of the Company. For the purposes of this section beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act."
- If the maximun amount of shares can not be more then 4.99% of the O/S for each Advance, and we know that the O/S is 109mil, then 4.99% is about 5439100 Shares, then EVCA needs to expand its O/S dramaticly to get to +-15mil shares needed for their first Advance to stay within the 4.99 margin...
Or am I missing something here?
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Please correct me if I'm wrong!!
