BeauBeau, thanks for your input and your diligent

BeauBeau, thanks for your input and your diligent work as far as the numbers and figures related to the Ironridge deal. We all appreciate your DD and such discussion adds value to the board, much appreciated. However, of course, I do have some items I would like to point out. First of all, clearing the air as to what was stated previously,

You stated : " I put up some DD on the Hub, that explained why I thought there could be as many as 800M shares in dilution, to finally pay off the $700K "

In response, I stated : " 800M shares even sold at $0.0015 is about $1.2M which is no where near $700k " ; what I was getting at was that the fact that your 800M share estimate for the final share position Ironridge was entitled to is IMO way too liberal, because even assuming a significant discount to the average volume weighted prices, of say $0.0015 such a large number of shares would have equated to monies to Ironridge in excess of $1.2M which they in no way should be entitled to IMO.

I think it is fair to say that even with the attorney fees and other fees added to the original $643k debt, the final figure owed to Ironridge was about $700k. Even the CEO noted this number in an announcement to shareholders. See my previous post about the details of the Ironridge deal here ...

Post # 7230

http://investorshangout.com/post/view?id=167644

Let us consider some fuzzy math...

X == the number of shares Ironridge eventually is entitled to

X = $700k / average minimum PPS Ironridge has ever been able to be entitled to

The key to this whole calculation and what makes it speculation on our part is that it is not a static operation, the minimum available PPS for Ironridge to receive issuances is always changing based on the average volume weighted PPS over time, therefore no one can do a simple static calculation to know exactly how many shares Ironridge ever received for the first part of the deal. Another key to note, is that we should only be talking about the first part of the deal when speaking of dilution and the $700k, the $50/month based upon 150 pref shares is entirely another story. We can however guesstimate based on maximum and minimum volume and prices we have seen in the stock since Sept 19 2012.

At time of first issuance of 143,500,000 shares, 70% of the average volume weighted PPS was about $0.0021 which means the first traunche of shares should have accounted for about $300k of the $700k owed. So since then about $400k was leftover to be paid to Ironridge via share issuances.
Since then the 200 DMA has moved lower. Let us estimate the MAXIMUM number of volume weighted shares they could have been entitled to by way of using the lowest possible average volume weighted share price based on the lowest level of the 200 DMA which is $0.0019. 70% of $0.0019 is
$0.0013
and so $400k/$0.0013 is roughly 308M shares.
Before this last ~200M share dilution up to 1.9B shares, the O/S had been about 1.77B which is roughly 330M shares above the O/S level at 9/26/2012 which seems to account for the Ironridge share issuances needed to pay off the first part of the funding deal (~$700k). Remember, the second part of the funding deal, was strictly $1.5M for 150 pref shares, or so we know from filings; anything else is speculation. In my opinion, the first Ironridge funding deal was entirely paid off once the O/S had reached to about 1.77B and this last ~200M share issuance maybe was for something unrelated but its all just guesswork of course, we cannot know for sure unless we could see internal documents.

Another detail to not overlook is the fact that for a 5 consecutive days worth of aggregate trading volume (considering volume weighted average prices) to sum to $2.5M, each trading day basically needs to see roughly $500k change hands. The problem is that as the 200 DMA has fallen over time from the $0.003 level down to about $0.0019 there have not been very many time frames wherein that condition was true. If we consider, $500,000 / $0.002 that implies we would need to see a trading day with volume at about 250M shares, which as we are aware only happened once since then and the max PPS at that time was $0.0045 and the MINIMUM average volume weighted share price during that 5 day window (Feb 12, 2013) was $0.0019. So, again, 70% of that price is $0.0013, therefore most likely the Ironridge average cost basis for their 9.9% stake at any time was at the very least, about $0.0013 which means that for $400k / $0.0013 equates to a position size of about 308M shares, which against a 1.77B O/S is already greater than 9.9% so we must assume that over time their position size remained roughly the same but they were churning (selling newly issued shares over and over) and this overall position size could not really have been more than 308M shares plus the original 143M shares, which is about 451M shares, not the billions of shares some are purporting.

In my opinion, Ironridge has already churned enough shares within their maximum position stake of 9.9% of the O/S so as to make back their original capital loaned to RFMK. It is only a guess and an opinion and anyone else claiming that they can know for certain what Ironridges total final share size is or was is just blowing hot air. No one can actually know for certain the exact metrics in this regard. We must keep in mind that the two Ironridge deals are seperate and also that the payback of the first part of the deal (for the $700k) has been done over time with ever-changing share prices and volume. The possibilities for Ironridge to be entitled to maximum number of shares have been few and far between as the average volume has been rather low and the 200 DMA (which is a good reference to use in these guesstimations) has only basically moved from $0.003 to $0.002 during all of this (since the original issuance on Sept 19 2012). IMO it is highly suspect to think that Ironridge has been or is going to be getting paid over $1M based on the first part of the funding deal, or that somehow Ironridge has or will be entitled to a final share position size of over 800M shares. The math on such assumptions is questionable at best and IMO it just does not add up. All just my opinions.

$RFMK