[PHGI]: The Sept. 27th Perihelion Global, Inc. press release - What's wrong with this picture?

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Please take some time to read the "informative" press release issued by PHGI's CEO:

http://www.marketwire.com/mw/release.do?id=774659&sourceType=1


What's wrong with this picture?

This blog will be referring to this September 27, 2007 press release during the next few weeks regarding the "Excellence in Management" being exhibited by Perihelion Global, Inc. and its officers, Directors and consultants.

As an example, the company announced that it closed transactions (acquisitions and financing) and compensated its officers, Directors and consultants by issuing about 150 million common shares - equal to about 3 times the original common shares outstanding as of February 2007. The stock price of the common shares then drops significantly.

All of the sudden the company announces that more than 100 million of these almost worthless common shares have been exchanged for preferred shares (some of which are convertible preferred shares), but fails to state the details and the terms of the conversion for these preferred shares. PHGI also fails to state what the fully diluted common shares outstanding are.

Yet the company and its paid promoters announce that the capital structure of the company is in better shape than before.

Since when is it beneficial for a common stockholder when a company has common shares, other than what he owns, converted to preferred shares that get preferential treatment over common shareholders in the event of a liquidation - and worse yet, these preferred shares might be convertible into a multiple of common shares outstanding, thereby diluting the original common stockholders by a significant factor?

What is wrong with this picture?



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