Ellen... An Excerpt from Suzanne's post #26579 concerning the revolving credit line.
Q. Does Mr. Gordon intend to convert this balance into shares?
A. "If the cash is available, I think he would like to take the cash.
But it would possibly be converted into shares." Note: the option to
take cash versus shares is totally up to Mr. Gordon per the "Revolving
Credit Line" agreement. At 15 cents, $350,000 converts into 2.3 million
shares.
Mr. Henry and I then had a discussion about the "Revolving Credit Line"
agreement which allows Mr. Gordon to convert up to $5 million of loan
into shares at $.15 per share. The essence of this discussion is as
follows. If the disinterested directors ask Mr. Gordon to put money into
the company and he has the money, if disaster strikes and the market
goes down to 6,000 and there's no other source of financing, there is a
"theoretical possibility" that Mr. Gordon would loan the company money
under the above terms. I asked wouldn't the company be better off
eliminating the credit line agreement which makes it appear as if Gordon
owns 26.6 million more shares than he actually does. Mr. Henry agreed it
would improve the 10K. He added when business conditions improve, the
agreement would almost definitely be removed. Mr. Gordon's concern is >>>if
he removed the agreement now, and the worst scenario occurred, putting
the agreement back in place would cause the shareholders additional
anguish.<<<< Mr. Henry pointed out that he personally hoped that 26.6
million shares was never converted because it diluted the value of his
investment also. He thinks the agreement will be eliminated eventually,
but doesn't feel that now is the best time to do it. He added, however,
that if a group of shareholders got together and asked Gordon to remove
the agreement, he may do it.
Thought it might shed some light. >>>if he ( Rob Gordon ) removed the agreement now, and the worst case scenario occurred, putting the agreement back in place would cause the shareholders additional anguish.<<<
Fuel for thought. No opinion at this time.
Jerry |
