Actually that 8k is good news! It essentially means that they were able to convince the majority of financers to hold off on conversion (those from OCT 2005 to July 2006, or four sets of them)
What this means for us: they needed at a price of $.05 to dilute approximatly 45M shares for the SEP 2004 financer and approx 75M shares for the APR 2004 financer, both of these estimates at a stock price of $.05. Well, of course, when this started, what happened? The share price stated to erode under the pressure.
So, per the SB2 "In addition, the number of shares of common stock issuable upon conversion of the outstanding secured convertible notes issued pursuant to the securities purchase agreements dated September 23, 2004, April 22, 2005, October 24, 2005, December 28, 2005, March 23, 2006 and July 24, 2006 may increase if the market price of our stock declines."
So, as the stock falls, they must issue more shares.
My numbers indicate that for these two financers, at an average stock price of about $.025 (estimate over the past 6 months weighted for volume), they would probably need to dilute 60% of 300M shares, or 180M (based on their table at $.025). Tack on another 20M to be safe...
200M shares should do it for now. Something tells me we are close then...
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