ONSP
On June 19, 2003 the Company granted 67,500 stock options to Evolve One Inc in a
revolving note agreement see footnote G. The options have an exercise price of
$.10 per share. The Company also granted on June 19, 2003 607,500 stock options
to Evolve One Inc in the same note agreement. These options have an exercise
price of $.30 per share. The Company recognized a non-cash interest expense of
$100,575 during the nine month period ended June 30, 2003.
PREFERRED STOCK - At June 30, 2003, the Company had 2,713 shares outstanding of
its Series A Convertible Preferred Stock ("Series A"). This issue has a stated
liquidation preference value of $100 per share redeemable at the Company's
option, has no voting rights, and each preferred share is convertible into 4
shares of the Company's common stock as adjusted for the 1 for 12 reverse stock
split. Dividends on the Series A were to be paid monthly in cash at a rate of
12% of the original issue. The Company's Board of Directors, elected for the
payment of cash dividends on its Series A to be suspended. This decision was
made in light of the general economic conditions. In particular, the Board took
such actions as necessary to preserve the Company's working capital in order to
ensure the continued viability of the Company. The Board of Directors is unable
at this time to predict if the Company will resume the payment of cash dividends
on its Series A 12% Cumulative Convertible Preferred Stock. However, the Company
has accrued dividends on these shares in the amount of $30,946 at June 30, 2003. |
