Take a look at the news of re-pricing the notes announced on Aug. 26th.
Simply, the note holders can convert up to 2.22 mil dollars to the lower of 0.08 or 40% discount of the average closing for the last previous trading days. Therefore, if we assume that the average closing price was 0.018, then they can convert those 2.2 mil dollars notes to shares at the cost of 0.018* (1-0.4) = 0.0108.
Now if you divide 2.3 mil dollars notes by 0.0108, it would result in around 212 mil new shares. Not a bad deal for note holders :-)
Meanwhile, I am not 100% sure but I have a feeling that some of the note holders are some insiders who wants to have huge pie of the company to get rid off the retail investors. In addition, there could be other debts that can be converted to the shares with the same condition too. Unless I see the huge share dilution risk is gone, I think it is a very risky investment at this point. Because once the number of shares is increased to 300-400 mil shares (perhaps this was the reason for authorized shares from 50 mil to 500 mil shares), the company may want to do Reverse Split afterward.
News 
Market Data 
Discover 
