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Strategies & Market Trends : Shorting stocks: Broken stocks - Analysis -- Ignore unavailable to you. Want to Upgrade?

To: chester lee who wrote (2241)	4/24/1999 7:20:00 AM
From: xcr600	Respond to of 2506

<CHARD> The the reverse split was done to meet NAz minimum bid requirements. They have a hearing scheduled with Naz for April 30, 1999. As of December 31, 1998, substantially all of the Company's assets are invested in the development of the Karakuduk Field. The Karakuduk Field has not produced any revenues as of December 31, 1998 and is not expected to produce revenues sufficient to meet KKM's cash needs during 1999. The development of the Karakuduk Field, through KKM, will require substantial amounts of additional capital. KKM's revised license with the government required KKM to expend $10 million as of December 31, 1997 and another $16.5 million as of December 31, 1998. Total expenditure commitments, from the commencement of operations through December 31, 1998, of $26,500,000 have been satisfied by KKM. KKM has an additional expenditure commitment of $30 million for the year ending December 31, 1999, of which KKM has spent approximately $3.5 million as of April 8, 1999. Lots of warrants. The following table summarizes the price ranges of all common stock purchase warrants outstanding as of December 31, 1998: Stock Warrants Outstanding as of December 31, 1998 Number of Warrants Exercise Price --------------------------------------------------- 1,000,000 $3.50 200,000 $1.00 100,000 $0.85 100,000 $1.25 750,000 $0.28 462,500 $0.25 920,000 $0.01 1,022,000 $.00001 ---------------------------------------------- 4,554,500 $0.00001 - $3.50 Series A,B,C conversion: The number of shares of common stock issuable upon conversion of each share of Series A Redeemable Preferred Stock is determined by dividing $100 by the conversion price of the preferred stock. As of December 31, 1997, the conversion price was $2.25 per share. The conversion price is subject to recalculation if, and when, the Company issues additional common stock or common stock equivalents to obtain additional equity or debt financing. During 1998, the Company issued common stock and common stock warrants in both equity and debt financing transactions. Adjusted for these transactions, the conversion price as of December 31, 1998 was $2.14 per share (rounded), equivalent to 46.7 shares of common stock for each share of Series A Redeemable Preferred Stock. The Series B Preferred Stock and Series C Preferred Stock would have been convertible at the option of the holders thereof at any time or from time to time on or prior to the redemption date into Common Stock. The conversion price of the Series B Preferred Stock was initially $3.00 per share; and the conversion price of the Series C Preferred Stock was initially $4.25 per share. The number of shares of Common Stock issuable upon conversion of each share of Series B Preferred Stock and Series C Preferred Stock would have been determined by dividing $100 by the conversion price per share.