Kudos to Bob Schneiderman for standing up to the 8
Post# of 7769
Posted On: 05/12/2014 5:19:56 PM
Kudos to Bob Schneiderman for standing up to the 800-pound gorilla and bully, Ironridge!
Item 8.01 Other Events.
As previously disclosed by the Registrant in its Current Report on Form 8-K filed on November 19, 2013, the Registrant issued to Ironridge Global IV, Ltd. (“Ironridge”) 8,690,000 shares of its common stock in settlement of bona fide claims against the Registrant which were purchased by Ironridge from various creditors of the Registrant (the “Claim Amount”). The shares issued to Ironridge were freely tradable and exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to Section 3(a)(10) of the Securities Act. Pursuant to the court order issued by the California Superior Court for the County of Los Angeles (“California State Court”) on November 8, 2013, the shares of the Registrant’s common stock were deemed issued in settlement of the claims (subject to certain adjustments based on the future trading value of the stock) when delivered to Ironridge. The number of shares issued to Ironridge is subject to an adjustment based on the trading price of the Registrant’s stock such that the value of the shares is sufficient to cover the Claim Amount, a 10% agent fee amount and Ironridge’s reasonable legal fees and expenses ( the “Final Amount”), which Final Amount is equal to $766,238.29.
On February 10, 2014, Ironridge made a request for, and the Registrant subsequently issued, an additional 1,615,550 shares of the Registrant’s common stock as a result of the adjustment provisions under the stipulation in the court order issued by the California State Court (the “Stipulation”).
On April 4, 2014, Ironridge requested even more shares pursuant to the adjustment provision under the Stipulation. This time their request was for an additional 1,646,550 shares of the Registrant’s common stock. The Registrant declined to issue these additional shares because Ironridge had already received, to that date, approximately 10,305,550 shares of free trading stock with a market value of approximately $1.2 million (based on the closing stock price on May 6, 2014), in settlement of a Final Amount of $766,238.29. The shares already issued to Ironridge represent a premium of 48% to the Final Amount.
On May 6, 2014, Ironridge submitted an ex parte application to the California State Court to compel the issuance of the 1,646,550 shares requested from the Registrant on April 4, 2014, and the California State Court, without a hearing, entered an order to compel the Registrant to issue the additional shares. On the same day, the Registrant filed a notice of appeal of the California State Court’s order. The appeal automatically stays enforcement of the California State Court’s May 6 order.
The Registrant believes that Ironridge is not entitled to additional shares as it has received a significant premium on the Final Amount which Ironridge itself had declared to the California State Court served as the basis of the adjustment mechanism for the number of shares issued based on the Registrant’s stock price. The Registrant will vigorously pursue the appeal, and reversal, of the California State Court order. In the opinion of the Registrant’s management, the matter currently pending against the Registrant is not expected to have a material adverse effect on its financial position or results of operations.
http://www.sec.gov/Archives/edgar/data/152147...051214.htm
Item 8.01 Other Events.
As previously disclosed by the Registrant in its Current Report on Form 8-K filed on November 19, 2013, the Registrant issued to Ironridge Global IV, Ltd. (“Ironridge”) 8,690,000 shares of its common stock in settlement of bona fide claims against the Registrant which were purchased by Ironridge from various creditors of the Registrant (the “Claim Amount”). The shares issued to Ironridge were freely tradable and exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to Section 3(a)(10) of the Securities Act. Pursuant to the court order issued by the California Superior Court for the County of Los Angeles (“California State Court”) on November 8, 2013, the shares of the Registrant’s common stock were deemed issued in settlement of the claims (subject to certain adjustments based on the future trading value of the stock) when delivered to Ironridge. The number of shares issued to Ironridge is subject to an adjustment based on the trading price of the Registrant’s stock such that the value of the shares is sufficient to cover the Claim Amount, a 10% agent fee amount and Ironridge’s reasonable legal fees and expenses ( the “Final Amount”), which Final Amount is equal to $766,238.29.
On February 10, 2014, Ironridge made a request for, and the Registrant subsequently issued, an additional 1,615,550 shares of the Registrant’s common stock as a result of the adjustment provisions under the stipulation in the court order issued by the California State Court (the “Stipulation”).
On April 4, 2014, Ironridge requested even more shares pursuant to the adjustment provision under the Stipulation. This time their request was for an additional 1,646,550 shares of the Registrant’s common stock. The Registrant declined to issue these additional shares because Ironridge had already received, to that date, approximately 10,305,550 shares of free trading stock with a market value of approximately $1.2 million (based on the closing stock price on May 6, 2014), in settlement of a Final Amount of $766,238.29. The shares already issued to Ironridge represent a premium of 48% to the Final Amount.
On May 6, 2014, Ironridge submitted an ex parte application to the California State Court to compel the issuance of the 1,646,550 shares requested from the Registrant on April 4, 2014, and the California State Court, without a hearing, entered an order to compel the Registrant to issue the additional shares. On the same day, the Registrant filed a notice of appeal of the California State Court’s order. The appeal automatically stays enforcement of the California State Court’s May 6 order.
The Registrant believes that Ironridge is not entitled to additional shares as it has received a significant premium on the Final Amount which Ironridge itself had declared to the California State Court served as the basis of the adjustment mechanism for the number of shares issued based on the Registrant’s stock price. The Registrant will vigorously pursue the appeal, and reversal, of the California State Court order. In the opinion of the Registrant’s management, the matter currently pending against the Registrant is not expected to have a material adverse effect on its financial position or results of operations.
http://www.sec.gov/Archives/edgar/data/152147...051214.htm
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