http://www.pinksheets.com/quote/...06%255C08%255C31%255C&symbol=CKEIE
During the three months ended June 30, 2006, convertible debentures in the principal amount of $767,404 were converted into 89,000,000 shares of common stock.
Based on the closing market price of the Company?s common stock on June 30, 2006, the conversion of its convertible debentures and Series A convertible preferred stock would have resulted in the issuance of additional common shares in the amount of 432,452,867 and 141,176,471, respectively. Additionally, 17,000,000 and 10,500,000 stock purchase warrants were exercisable at June 30, 2006 and June 30, 2005, respectively, and also were not included in the weighted-average number of common shares outstanding.
FINANCIAL CONDITION
We had net losses of $638,908 and $306,415 during the three months ended June 30, 2006 and 2005, respectively. As of June 30, 2006, we had a cash balance of $457,489 and current liabilities of $993,604 with obligations aggregating $179,209 for trade creditors and accrued expenses, $684,711 in interest payable, $40,173 in a note payable, as well as total long-term obligations in the amount of $2,550,065 to convertible debenture holders and others. We believe that our available cash will be sufficient for the next twelve-month period to meet our working capital needs, including funds needed to (a) attract additional customers through marketing and promotional efforts or (b) acquire customer lists.
As of August 14, 2006, we had 383,564,587 shares of common stock issued and outstanding, outstanding convertible debentures and shares of convertible preferred stock that may be converted into an estimated 573,629,337 shares of common stock at current market prices, and outstanding warrants to purchase up to 17,000,000 shares of common stock. In addition, the number of shares of common stock issuable upon conversion of the outstanding convertible debentures may increase if the market price of our stock declines. The sale of these shares may adversely affect the market price of our common stock.
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