Well, I have reviewed the 10K and here are the main points of interest..
Current outstanding shares as of 2/26/98 - 16,080,447
Prior outstanding shares on 11/11/97 - 15,288,139
EPS (Prime) -.09
EPS (Diluted) -.08
From the 10K dated 3/30/98: The Company is in the process of completing Media Manager and is deciding if the product should enter the market by retail distribution or by licensing/OEM.
freeedgar.com
From the 10Q dated 11/14/97: The Company has completed Media Manager and is deciding if the product should enter the market by retail distribution or by licensing/OEM.
sec.gov
How can Media Manager have been completed in November and be in process 4 months later???
On to the dilution factor:
In August of 1997, the Company's note and accrued interest payable in the amount of $317,547 to Westridge Capital was converted into 400,000 shares of common stock with a basis of $.794 per share. In November of 1997 the Company exchanged 400,000 shares of common stock for $600,000 of prepaid advertising.
On February 13, 1998, the Company sold 200,000 shares of common stock and 100,000 warrants (each warrant to purchase one share of common stock at an exercise price of $1.50 per share, exercisable for five years from the date of sale) to an accredited investor for $200,000.
On March 1, 1998, the Company replaced the two convertible debentures with a new convertible debenture due September 1, 1998, for $850,000 which pays interest at the same rate as the replaced debenture. The principal sum of the new debenture and any accrued interest may be converted into common shares at any time prior to the due date at $.60 per share.
Notice the last conversion price.. $.60 .. If converted, that equals 1.4 million shares of dilution. Add to that 400,000 shares at $.794.. IE don't expect to see $1 anytime in the near future..
The Company is planning to do additional private placements of it's common stock to raise up to an additional $1 million to provide working capital for the Company's planned business activities. The success, or lack thereof, of this funding may have a material impact on the future of the Company. Similarly, the lack of sufficient sales of the Company's products will have a material impact on the future of the Company.
If this occurs at these prices, it equals another 2,000,000 shares of dilution. Hopefully, money from PC Guru will hit the door before this is necessary.
Rainer Poertner - Director since February 23, 1996 - Ouch! |
