[eeman]

From your post, you must be a very knowledgeable guy, so let me ask you this question: Re the "investors" who bailed them out and got convertible preferred stock. Does that explain why there are 50 million authorized shares, but only 14,155,276 outstanding shares. Hence they could flood the market in case some evil mean conservatives tried to buy them out for their own malevolent purposes?

[wideawake]

Most companies have far more authorized shares than issued shares these days in order to protect themselves against hostile takeovers precisely like the one you were contemplating.

As I look through Salon's recent 10-K filing I see that the convertible note holders and the convertible preferred holders have a majority of voting shares and effectively control the corporation.

In other words, not only do they control the lion's share of the issued stock, they also have the right to award themselves as many new shares as they want. There is no way anyone can wrest control of this company from them.

I note that according to their most recent financial statements the company has $1.5M in debt and lost $3.8M in cash last year. Given their burn rate and current cash balance of only $162K, they had about 15 days of liquidity left as of March 31, 2003.

This means that they are certainly bankrupt from a technical point of view - the investors must be continually pouring almost a million dollars of cash into this comapny each quarter.

That's a fairly expensive proposition.