Vitro Diagnostics Inc. (fka VODG)

[Potse]

db7...proposed merger, debt reduction.....

As currently contemplated, and based upon the current financial conditions of both parties to the Merger, the consideration for the Merger would consist of Vitro issuing 4.0 million shares of common stock and paying an additional $250,000 on terms yet to be determined. The Letter of Intent also contemplates the conversion of accrued debt to Vitro Biopharma's president into 1.0 million shares of common stock and other balance sheet restructuring.

Although I will need to see what the final detailed agreement will look like, based on the limited information in the press release this looks encouraging and potentially very attractive for existing shareholders. One thing that I would like to have seen in this particular press release is just a little bit more clarity on the main items mentioned in the above paragraph.

The wording in the press release doesn't make it entirely clear whether the shares issuances will be based on the current share structure or whether they are based on a different structure (reverse split). I am assuming it is the former, but it would be helpful if the company could confirm/clarify that.

Regarding the 1M shares to be issued to CEO James Musick for the conversion of accrued debt: It will be interesting to see if this covers all of the debt owed to Musick (accrued salary, advances, interest, etc.) or just a portion of it. I am assuming it is the former (all of the debt), but as in the previous paragraph it would be helpful if the company could confirm/clarify that for shareholders.

It has long been my opinion that one of the most productive/impactful things that Musick could do (from a somewhat non-operational standpoint) is find a way to cleanse all of that accrued debt from the balance sheet. As part of the financing that VODG did in 2008, a shareholder-friendly debt reduction plan had been initiated but only the first phase was completed. Off the top of my head, if all phases/conversions of that plan had been completed, the net result would have been the elimination of CEO debt (about $1.2M, at the time) in exchange for more than 1.7M shares.

If in fact the merger and share issuances are based on the current share structure, and the debt reduction includes all of the CEO's debt, this would be even more attractive than that 2008 debt reduction plan was. About $1.9M in debt would be eliminated from VODG's balance sheet in exchange for 1M shares.

With the stock currently trading at .042/shr, existing shareholders probably will not complain too much if the CEO wants to convert his debt at a valuation of $1.90/shr.