REGULATION S
On January 9, 2004, the Company and its management (shareholder) entered into a Regulation S Stock Purchase Agreement with California Securities S.A. (CA Securities) a Panamanian business company. The Company agreed to sell to CA Securities in an "offshore transaction" as defined in Regulation S, which transaction had been negotiated outside the U.S. and consummated and closed outside the U.S., and the Purchaser agreed to purchase up to 8,000,000 Units. A unit meant two shares of common stock of the Company. One share was a new share issued by the Company as part of this Reg. S Stock Purchase Agreement and the other share was sold by the Shareholder from their own stock.
For each unit , the purchase price comprised of (1) $.001 per share for the share sold by the shareholders and (2) Per "purchase price" for the shares issued by the Company. "Purchase Price" for the Company Share was the Share Price multiplied by 30%. "Share Price" was the closing bid price (on the OTCBB) multiplied by 90%. Proceeds paid to the Seller was allocated $.001 for each share to Shareholder and the balance to the Company. The Purchaser agreed to use its best efforts to purchase up to 8 million Units between the date hereof and May 30, 2004 ("Best Efforts Period"). For the period ended June 30, 2004, the Company issued 5,226,906 shares of common stock under Regulation S Offering amounting $795,161.
On April 28, 2004, the Company completed the sale of $5.8 million of its common stock and warrants to certain purchasers. The Company sold 48,333,347 restricted shares of its common stock at a purchase price of $0.12 per shares. The purchasers received five-year warrants to purchase 48,333,347 shares of common stock at an exercise price of $0.30 per share. Pursuant to the Registration Rights Agreement the Company has agreed to prepare and file with the Securities and Exchange Commission a registration statement covering the resale of the restricted shares of its common stock and common stock issuable upon any exercise of the warrants. As a result, during the period ended June 30, 2004, the Company issued 52,171,169 shares of common stock including warrants of 3,837,822 for cash amounting to $5,183,027, net of commissions amounting $616,973. $20,000 of cash was received in the prior period.
During the six month period ended June 30, 2004, the Company issued 954,827 shares of common stock for cash receipt of $247,418.
During the six month period ended June 30, 2004, the Company issued common stock in exchange of various services to following parties:
The Company issued 231,222 shares of common stock for legal and consulting services amounting $101,456. The Company issued 925,395 shares of common stock for finder fees and investor relations amounting $506,327. The Company issued 40,000 shares of common stock for salary amounting $22,000.
The Company issued 591,152 shares for dividends on Series D convertible Preferred stock amounting $310,000. |
