wso2: I don't think the shares are being issued to buy equipment (anymore). They are being used to pay down debt. The 10K shows equipment being obtained via the capital lease agreement. We will find out more about the 38M shares issued between 12/1/07 and 2/29/08 in the next 10Q.
Here's the dilution since the R/S to the end of November (according to the 10K):
During the year ended November 30, 2007, and subsequent to enactment of the 1 for 7 reverse stock split, 29,600,000 shares of common stock were issued at an average price of $.025 per share in exchange for the amount due on a related party payable to the recipient of the stock in the amount of $742,000; 11,400,544 shares of common stock were issued at an average price of $0.030 per share in a private placement for $348,227; 112,000 shares of common stock were issued for stock options at an average price of $0.090 per share for consulting services with a fair value of $10,080; 2,570,000 shares of common stock were issued at an average price of $.043 per share for consulting services with a fair value of $111,300; 1,500,000 shares of common stock were issued at an average price of $0.067 per share for a deposit on an operating lease in the amount of $100,000; 3,333,333 share of common stock were issued at an average price of $0.030 per share for the payment of a convertible debenture in the amount of $100,000 and 12,572 shares of common stock were issued at an average price of $0.00 per share to adjust for fractional shares held by shareholders as a result of the reverse stock split.
Here's a blurb about equipment obtained:
During the year ended November 30, 2007, the Company took delivery of and installed a coordinate measuring machine in order to complement the lasers and robotic equipment that the Company currently owns for performing production runs. This equipment was financed through a capital lease agreement, whereby the Company is obligated for monthly lease payments in the amount of $953 through June 30, 2010. At the expiration of the lease, the Company has the option of acquiring the equipment for a price of $1 (SEE note 4).
So it looks like they are keeping true to their word of no dilution to obtain capital equipment. Unfortunately, millions of shares are being sold at discount in private placements for cash. |
