Replies to post #22109 on Universal Energy Corp (UVSE)

[lov2surf]

eak435s -

Page 10 of 3rd quarter 10Q

Balance at September 30, 2008 $ 3,203,065

Bottom of page 22

During October and November 2008, the Company converted approximately $480,000 in debt into 664,364,542 shares of our Common Stock.

(The balance as of the 10Q date would be $3,203,065-$480,000=$2,723,065).

On page 33 a different debenture total is listed;

We have outstanding, as of September 30, 2008, $4,801,760 aggregate original principal amount of our Debentures.

(These debentures are to be paid under the following terms)


Unless deferred by the holders of the Senior Debentures, we are required to redeem the Senior Debentures on a monthly basis commencing on September 1, 2008, by payment, at our option, in cash or in shares of our common stock, one-twelfth of the aggregate original principal amount of the Senior Debentures or approximately $425,900 plus interest on the outstanding balance. Similarly, we are required to redeem the Junior Debentures on a monthly basis commencing on November 1, 2008, by payment, at our option, in cash or in shares of our common stock, one-twelfth of the aggregate original principal amount of the Junior Debentures or approximately $145,200 plus interest on the outstanding balance.


The Senior Debentures and the Junior Debentures are due and payable on September 1, 2009 and October 31, 2009, respectively, unless sooner converted into shares of our common stock.

...We anticipate that the full amount of the Debentures will be converted into shares of our common stock...

On page 24 it states the expected cost for operating the next 12 months are $ 1,775,000. The revenue on page 4 was $330,226 for 2 months of production. There was no production in the 3rd month due to hurricane damage. Multiply $330,226 times 6 to get 12 months revenue and you get $1,981,356 for the next 12 months before any new wells are brought on line.

Based on the info above the debentures remaining as of the 10Q date are between $2,723,065 and $4,321,760 and is due and payable by September 1, 2009 and October 31, 2009. What the company plan states is ...We anticipate that the full amount of the Debentures will be converted into shares of our common stock... which indicates that no revenue will be used to reduce the debentures. With 4.5 billion shares still available to be issued it would generate less than $1 million at the current price of .0001 to .0002 .

Other sources will be required to pay off the debentures either additional wells or other debentures besides the one that is due in 2010. All in my opinion of course.

[mikeyk]

Here's the best I can do for you without sitting down and parsing everything into a spreadsheet, this does not break down the promissary notes, but their remaining amount is included in the first table from Dec 31st to September 30th ending balance:

Unfortunately that information has never been broken down for anyone. There were 12 note holders on the Senior CD, that doesn't mean that each note holder loaned the exact same amount of money, so more, some less. There us also 2 other CD's that are being paid at the same time. We were told the company was expected to be debt free by end of the year, but that may have been before the company allowed the PPS to be driven into the ground which now make conversions so large and takes longer for the CD holders to sell/dump their shares. The 10Q is hard to read in account to who is being paid what amount or when, it just breaks out what has been paid on/towards each CD. This is information as of September 30th, and does not include the October and November conversions which were listed in a seperate footnote, this does not break down the promissory notes either, some of which have been paid in full, partial, and some not at all yet (Raly and Watford, theirs total $350K), and some were paid by cash while others were paid in stock. Cash was also used to pay towards debt when it was available.
Foot note for October/November conversions:
NOTE 14 – SUBSEQUENT EVENTS
During October and November 2008, the Company converted approximately $480,000 in debt into 664,364,542 shares of our Common Stock.

 
 Balance of Embedded derivative at December 31, 2007	 	$	10,915,752 
 Fair Value of warrants and conversion feature of the May 2008 debenture at issuance	 	 	1,723,649 
 Conversion of convertible debentures into common stock	 	 	(1,501,225 
 Gain on fair value adjustments to embedded derivatives	 	 	(17,339,619 
 Charge related to the repricing of the 2007 Debentures	 	 	9,404,508 
 Balance at September 30, 2008	 	$	3,203,065 
  
  
  
 Here's the break down of each seperate CD/debenture: 
  
 September 2007 Debentures at fair value	 	$	5,110,294 
 Penalties	 	 	76,537 
 Conversions	 	 	(2,547,926 
 Warrant derivative discount	 	 	(495,268 
 Original issue discount	 	 	(137,473 
 Net convertible debentures	 	$	2,006,164 
  
  
  
 November 2007 Debentures at fair value	 	$	1,742,647 
 Conversions	 	 	(836,410 
 Warrant derivative discount	 	 	(307,199 
 Original issue discount	 	 	(89,348 
 Net convertible debentures	 	$	509,690 
  
  
  
  
 May 2008 Debentures at fair value	 	$	1,256,618 
 Warrant derivative discount	 	 	(834,515 
 Original issue discount	 	 	(246,585 
 Net convertible debentures	 	$	175,518