Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Microcap & Penny Stocks : IMDS nasdaq bulletin board -- Ignore unavailable to you. Want to Upgrade?

To: Paul Vinarub who wrote (1564)	7/31/1998 9:41:00 PM
From: Labrador	Respond to of 4122

9 million more shares for sale. Another S-2 filed late Friday. Series F and Series H Preferred shareholders registering to sell their shares -- their conversion price (at their discount) estimated to be 30 cents. Excerpts from the S-2. SELLING SECURITY HOLDERS The Selling Security Holders consist of the Series F Preferred Holders and the Series H Preferred Holders. The registration statement of which this Prospectus is a part is being filed, and the Shares offered hereby are included herein, pursuant to registration rights as provided for in the subscription agreement and registration rights agreements entered into between the Company and the Selling Security Holders (collectively, the "Registration Rights"). Due to (i) the ability of the Selling Security Holders to determine when and whether they will sell any Shares under this Prospectus and (ii) the uncertainty as to how many of the Warrants will be exercised and how many shares of Common Stock will be issued upon conversion of shares of Series H Preferred, the Company is unable to determine the exact number of Shares that will actually be sold pursuant to this Prospectus. The number of fully paid and nonassessable shares of common stock, no par value, of the Company to be issued upon conversion of the Series H Preferred will be determined by dividing (i) the sum of $10,000 (ii) the Conversion Price (determined as hereinafter provided) in effect at the time of conversion. The"Conversion Price" is equal to lesser of seventy-five percent (75%) of the Average Price (the lowest closing bid price of the Corporation's Common Stock for the ten-ten-day trading period ending on the day prior to the date of conversion. Two hundred percent (7,200,000 shares) of the shares underlying the H Preferred Shares are included in the Registration Statement of which this Prospectus is a part and may be sold pursuant to this Prospectus. Since the conversion price of the Series H Preferred shares is based on the market price of the Company's Common Stock, the number of Shares subject to registration rights will increase. If the market price of the Common Stock decreases and will decrease if the market price increases. The following table identifies each Selling Security Holder based upon information provided to the Company, set forth as of July 29, 1998, with respect to the Shares beneficially held by or acquirable by, as the case may be, each Selling Security Holder and the shares of Common Stock beneficially owned by the Selling Security Holders which are not covered by this Prospectus. No Selling Security Holder or its affiliates have held any position, office or other material relationship with the Company. The percentage figures reflected in the table assume conversion of all shares of: Series H Preferred into 3,600,000 shares of Common Stock and exercise of all Warrants into 125,000 shares of Common Stock. Balmore Funds SA C/0 Trident Trust Company (BVI) Limited Trident Chambers Road Town Tortola, British Virgin Islands --------------------------------------------------------------------------------------------------------------------- Austost Anstalt Schaan Ladstrasse 163 9494 Furstentums Vaduz, Liechtenstein --------------------------------------------------------------------------------------------------------------------- Settondown Capital International, Ltd Charlotte House, Charlotte Street P.O. Box N 9204 Nassau, Bahamas --------------------------------------------------------------------------------------------------------------------- (1) Based on the number of shares that would be required to be issued if the Preferred Stock were converted at $.30 per share (75% of the lowest 10 day bid price prior to registration. (2) Amount being registered is 200% of the number of shares that would be required to be issued if the Preferred Stock were converted on the day before the filing of the Registration Statement plus the shares underling the Warrants. The Company has received a firm commitment for a $15 Million, three year Equity Line of Credit whereby the Company, as it deems necessary, may raise capital through the sale of its common stock to the Series H Holders through a consortium of prominent European banking institutions. The Shares will be purchased at a discount from the Market Price of the Company's Common Stock. If the Company utilizes the Equity Line of Credit or additional funds are raised by issuing equity securities, especially Convertible Preferred Stock, dilution to existing Shareholders will result and future investors may be granted rights superior to those of existing Shareholders. At present, due to the decline in the price of its common stock, the Company does not have available enough authorized common stock to utilize the Equity Line of Credit.

To: Paul Vinarub who wrote (1564)	7/31/1998 9:43:00 PM
From: Labrador	Read Replies (1) \| Respond to of 4122

So it appears that these preferred shareholders may not really be investing in the "promise" of the company's product. Rather, maybe they are just buying the preferred stock for the guaranteed profit that they get given the floating conversion price at a 20-30% discount. Of course, this type of dilution really just comes out of the hide of the public shareholders, as these offerings steal value from the public. Soon there will be 100 million shares outstanding. Do you realize that these preferred shareholders are brand new investors in IMDS. Do you realize that the Series H preferred shares are for the $15 million of line of credit -- I suspect that the consortium of prominent European banking institutions has not even put up a dollar yet. By the way, I am heading for a week's vacation (sold a few Microsoft shares). I won't be monitoring this board, but I will monitor the share price. Any guesses where the stock price may be heading as a consequence of this registration statement? Good luck to all you IMDS shareholders.