1) On January 27, 2017, upon approval of the Company?s board of directors, George J. Coates and the Company mutually agreed to rescind three transactions during the year ended December 31, 2016, pursuant to which an aggregate of $314,751.62 of accrued interest on 17% promissory notes due to Mr. Coates were converted into common stock at an average price per share of $0.0008764. The effective date of the rescission was December 31, 2016. As a result of these rescissions, an aggregate of 359,139,789 shares of common stock held by Mr. Coates were canceled and restored to authorized, unissued stock and $314,751.62 of accrued interest was reinstated as a currently liability on the books of the Company as of December 31, 2016.
( 2) The average price per share of common stock rescinded was $0.0008764.
( 3) In connection with the rescission of the conversion of accrued interest due to Mr. Coates, 359,139,789 shares of common stock and 2,541,086 shares of Series B Convertible Preferred Stock held by George J. Coates were canceled. In order to maintain his percentage of all eligible votes on matters brought for a vote to the common stock shareholders at 85.76%, 670,219 shares of Series A Preferred Stock were issued to Mr. Coates on January 27, 2017. Each share of Series A Preferred Stock entitles the holder to 10,000 eligible votes.
( 4) The cancellation of 359,139,789 shares of common stock held by Mr. Coates as a result of the rescission of the conversion of accrued interest due to Mr. Coates, reduces his percentage ownership of common stock outstanding. As a result, it is also necessary to cancel 2,541,086 shares of Series B Convertible Preferred Stock held by Mr. Coates in order to properly adjust his anti-dilution shares, based on his adjusted, reduced common stock ownership percentage. The cancellation of these 2,541,086 shares of Series B Convertible Preferred Stock is being reported on six rows under this Table II in order to present all the details. This note is provided to properly explain the nature of this transaction and, accordingly, is applicable to all six rows presented.
( 2) The average price per share of common stock rescinded was $0.0008764.
( 3) In connection with the rescission of the conversion of accrued interest due to Mr. Coates, 359,139,789 shares of common stock and 2,541,086 shares of Series B Convertible Preferred Stock held by George J. Coates were canceled. In order to maintain his percentage of all eligible votes on matters brought for a vote to the common stock shareholders at 85.76%, 670,219 shares of Series A Preferred Stock were issued to Mr. Coates on January 27, 2017. Each share of Series A Preferred Stock entitles the holder to 10,000 eligible votes.
( 4) The cancellation of 359,139,789 shares of common stock held by Mr. Coates as a result of the rescission of the conversion of accrued interest due to Mr. Coates, reduces his percentage ownership of common stock outstanding. As a result, it is also necessary to cancel 2,541,086 shares of Series B Convertible Preferred Stock held by Mr. Coates in order to properly adjust his anti-dilution shares, based on his adjusted, reduced common stock ownership percentage. The cancellation of these 2,541,086 shares of Series B Convertible Preferred Stock is being reported on six rows under this Table II in order to present all the details. This note is provided to properly explain the nature of this transaction and, accordingly, is applicable to all six rows presented.
