xanadu, I'll try and explain.
If anyone finds me wrong anywhere please pitch in. This may be worth trying to figure out. The new OS numbers had me confused but I think that I have it now.
The debenture:
Golden gate has a contractural agreement to buy 15mil convertable debentures at $1.09 per. Each debenture is worth $1.09 and can buy shares at 18% below the 3 closing lowest bid days out of the last twenty consecutive trading days (other ways to but, this is the best deal and the one GG will use, IMO).
Lets say that GG trades in 100 debentures and the 3 lowest bids in the last 20 days are .01. The $109.00 the debentures are worth will buy them 8,938 shares.
.01 - 18% = .082 per share X $109.00 = 8,938.
100,000 debentures = $109,000 X .082 = 8,938.000
And so on and soforth. Anyway in this scenario at .01 per share the GG deal would cost about 1,350,000,000. shares.
The only limit for trading them in is that GG cannot hold more then 9.9% of the outstanding at any one time. They can cash them in at any time they want and at any PPs it is at, unrestricted.
Since GZFX does not SEEM to have enough shares to honor the GG deal, they will have four choices, as I see it. 1. Reverse split while keeping the remaining untouched authorized with no RS. 2. Increase the existing authorized. 3. pay the penalties. 4. Do not let the PPs fall below a three day average bid of about .0075 and get the PPs back up there where GG will cash in.
Anyone wish to explore the number four scenario and what it means?
Hope this helps, Dusty
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