Pervasip Corp (PVSP)

[Arthur]

The debenture holders never need to "short" the stock to "get the best conversion price".

They always get the best conversion price anyways: a 45% discount over the lowest price of the last trading days.

The protocol exposed in the attachments of the 10Qs and 10K:

5. Conversion of Debt into Common Stock.
(A) At any time until both the Principal and Interest is paid in full and all conversions have been honored by the COMPANY and this Agreement is no longer outstanding, this Agreement, including interest and principal, shall be convertible into shares of Common Stock in the COMPANY at 55 percent of the average of the 5 closing prices for the Common Stock during the 5 trading days prior to conversion.
The CLAIMANT shall effect conversions by delivering to the COMPANY the form of Notice of Conversion attached hereto as Exhibit A (a "Notice of Conversion"), specifying the date on which such conversion is to be effected (a "Conversion Date") and Shares shall then be delivered by the COMPANY within four Business Days. If no Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such Notice of Conversion is provided hereunder. To effect conversions hereunder, the CLAIMANT shall not be required to otherwise physically surrender anything to the COMPANY. CLAIMANT shall not sell any Shares until COMPANY has delivered the Shares to CLAIMANT’S brokerage account.
B) The COMPANY covenants that it will at all times reserve and keep available out of its authorized and unissued shares of Common Stock solely for the purpose of issuance upon conversion of this Agreement.

The other Debentures follow a similar structure.

The CD holder sends PVSP a fax, asking for, say, $10K worth of debenture be converted into $15.5K worth of shares.
He always gets the best conversion price. In that case, half of the recent market price: sweet deal.