Replies to post #62717 on Pervasip Corp (PVSP)

[todd72113]

That's the million dollar question. It's total bs

[Arthur]

At the end of Q2:

Short-term borrowings at May 31, 2013 also include six convertible notes (the “Convertible Notes”) at annual interest rates ranging from 0% to 8%, totaling $271,499. The Convertible Notes consist of four notes totaling $184,749 that we issued in exchange for cash payments to our Company, one note of $19,000 that we issued in exchange for services rendered, and one note totaling $67,750 that we issued in exchange for existing non-convertible notes payable. Conversion features allow the holders of the Convertible Notes to convert into shares of our common stock at a discount to the trading price of our common stock, as defined, ranging from 42% to 55%. For a limited period of time before a conversion notice is submitted, the Company has the right to pre-pay some or all of the Convertible Notes at a 15% to 50% premium to the principal amount that is retired.

Item 5. Other Information.

From June 1, 2013 to July 19, 2013, we issued 91,465,000 shares of the Company’s common stock for payment on outstanding promissory notes of $181,314.

Effective June 19, 2013, the Company entered into a securities purchase agreement with 112359 Factor Fund (the “Fund”) pursuant to which the Company issued a 6% secured convertible debenture in the principal amount of $665,000 (the “Note”). The Note was sold to the Fund, which is an “accredited investor” (as such term is defined in the rules promulgated under the Securities Act of 1933, as amended), in exchange for outstanding debentures, fees and cash advances totaling $216,855, a new cash investment of $300,000, an original issuance discount of $100,000 and fees of $48,145. The new cash investment is scheduled to be remitted to the Company on a monthly basis from June 2013 to December 2013.

So, yes, the orgy of dilution in June was issued either to Asher or to Factor Fund.

At the end of May, Pervasip owed $1,517,773 to Factor Fund as "Long Term Debt". (From the $1M+$1M CD loan).

Long-term debt at May 31, 2013 consists of the aforementioned Amended Notes and New Notes of $1,517,773, plus a long-term capital lease obligation of $10,163 for a total of $1,527,936.

Then in June, Pervasip borrows $665K more, including already issued promissory notes that were rolled in the price.

During the second quarter of fiscal 2013, the Fund lent the company amounts of $50,000, $35,000 and $12,000 and refinanced them with another note of $665,000 (the “New Note”) on June 19, 2013.
The New Note also provided cash to purchase two outstanding convertible debenture for $99,360, $60,000 in cash for operations in June 2013, and $40,000 in cash each month for the months of July 2013 through December 2013, and cost the Company $68,640 in finders fees and legal fess, and $100,000 in an issuance discount.
The New Note has similar terms, due dates and conversion features as the Amended Notes and accrues interest at a rate per annum equal to 6% and has an effective interest rate of 86%. The company received an aggregate of $80,000 in cash under the New Note in July and August 2013.

As of August 31, 2013 and November 30, 2012 the Company owed its principal lender (“Lender”) $1,819,451 and $6,368,078 respectively.

OK, they owed Factor Fund $1.5M at the end of May, they borrowed $665K more, and they owe FF $1.8M 3 months later.

During the second quarter of fiscal 2013, a total of $289,007 of outstanding debt principal was converted into 143,766,382 shares of the Company’s common stock.

During the second quarter of fiscal 2013, a total of $289,007 of outstanding debt principal was converted into 143,766,382 shares of the Company’s common stock.

It is difficult to keep track of the debt, because PVSP borrows promissory notes with Asher, and then Factor fund re-purchase them from Asher, paying the 150% penalty. And extra fees are added to Vox' tab. All that debt to be ultimately converted into gazillions of PVSP shares.

EXHIBIT A TO SECURITIES PURCHASE AGREEMENT

DEBT SECURITIES

1. Those certain 8% Convertible Promissory Notes issued by PERVASIP CORP. (the “ Company ”) to ASHER ENTERPRISES, INC. (“ Asher ”), on November 29, 2012 and March 12, 2013 (the “ Asher Notes ”), copies of which are attached hereto, which Asher assigned to 112359 FACTOR FUND, LLC (“ Buyer ”) pursuant to that certain Assignment Agreement by and among the Company, Asher and Buyer dated May 29, 2013 (“ Assignment Agreement ”), and in exchange for a cash payment equal to the principal, interest and redemption amounts due from the Company to Asher under the Asher Notes as of June 4, 2013, or $99,360.00, which amount was paid by Buyer to Asher on June 4, 2013, plus an additional $9,936.00 in costs and expenses; and,

2.
Those certain Convertible Debentures issued by the Company to Buyer on April 16, 2013, and May 1, 2013, numbered PVSP – 59FF 003 and PVSP – 59FF 004 (the “ Buyer Notes ”), and with an aggregate balance of principal, accrued interest and fees due of $94,307.95 as of June 5, 2013.