kezzek, I don't know if you can call it toxic financing. Debt holders are share holders and want the same as we do.
The amount of near-term debt is low. They just converted a $32,500 loan to shares with the original maturity date of the note being July 25, 2013. Commencing January 25, 2013, the Investor was entitled to convert all or any part of the outstanding and unpaid principal amount on the note, as well as the interest accrued, into shares of common stock at a conversion rate equal to 55% of the average of the five lowest closing sale prices during the ten days preceding the conversion date. That is what VERT was doing the last month or so. I calculated 4 to 5 million shares were converted.
As far as any other debt, the next conversion doesn't happen until 4 cents as follows:
On August 23, 2012, we entered into a convertible note agreement with an investor pursuant to which we received $50,000. The original maturity date of the note is August 23, 2013 and are convertible into our common stock at a conversion rate of $0.04 per share. If converted, that equals only 1,250,000 total shares. Usually about one day's trading.
That's not that bad considering the up-tic in revenue this company is seeing. According to the 10Q, all other conversions are at .08 cents and above. By then, the company may have sales that puts those conversions at much less risk to share holders.
Debt for any company is not good just like debt for any consumer is not a good thing either. But, if a person can pay his bills, the debt isn't so bad and eventually is paid off. This company is one of the few pink or OTC company's that has real growing sales with product already on shelves, real patents and new products coming to market that will continue to boost sales. They just signed a world-wide contract with HoMedics for product distribution.
The share structure here is investor friendly. The authorized is only 100 million. But, fully diluted this company is worth more than we are trading at right now. Also, if you calculate all conversions due above .04, .08 and .15 cents, you will see that they do not even come close to eating up the authorized shares of 100 million. At .04 cents and above, the conversions are eaten up fast.
All those worried about the conversions should read the latest 10Q and do the math. You will see that those conversions do not threaten us, especially short-term. When the stock approaches .08 cents, then do the math. Even then, .08 cents will eat them up fast.
AI
