What does it mean?

The GreenShift world is abuzzz about the conversion of 9,931 Series D Preferred Stock to 10B Common shares.  Do I know what it means?  The quick answer is no.  But lets first say 'what it was',  then say 'what it aint', and then guess 'what it is'.

WHAT IT WAS
GreenShift's senior creditor is YA Global.  YA Global's collateral is the series D Preferred Stock.  The Preferred stock is held by Viridis Capital.  Viridis Capital is owned by Kevin Kreisler, the founder, CEO and Chairman of the Board, Greenshift.  It has always been the case that those shares are locked up.  In other words, they cannot be sold.  They cannot even be promised.  If the CEO were to tell the shareholders that if this or that happens he is gonna get rid of the preferred shares - that would be a violation of the agreement and could put the company in default.  This makes it difficult for GreenShift to communicate with shareholders about future share structure - and this information void leaves an opening for others with "various" motives.  The reason YA Global keeps this collateral as preferred shares is to protect their investment from dilution/reverse splits. 

What it aint'
Well, it appears no one is cashing out or selling out.  In "Note 16" below the lock up remains for these new common shares and the remaining preferred shares.  They cannot be sold or promised. 
"But SkunK, people are saying  . . . bad things"  

The same people are gonna say bad things about this company whenever news comes out.  If the news is bad they will say it is bad.  If the news is good they will say it is bad.  It is just a fact that some will always say the news is bad.  This all may be predictable but not very enlightening . . .

At first blush, the SkunK thought that the only difference in moving these 10B shares from preferred to commons is the shares lose their protection from dilution.  Although true, it seems moot since the remaining preferred shares continue to hold the 80% value - and perform their job as the senior creditor's collateral.

These 10B shares seem to have no effect on YA Global.  Since these shares have no effect on YA Global's position - but they are controlled by YA Global - the SkunK's guess is it is not only about them - it is about them and someone else.

It is not a bank for deferred employee compensation - that would be done with a different class of preferred.

It is not a bank for litigation lawyer compensation - these shares cannot be promised or sold.

It is not collateral for the Kreisler Family loans - these shares cannot be promised or sold. 

It is not about a dividend, the 10K below states that the dividend would be paid without being converted.

It is not about share votes, the 10K below states the preferred votes can be cast without conversion.

Anything inside the box seems to be accomplished easier through the issue of another type of preferred shares?!?

What it is?

The one guess that makes sense to me is we are seeing a share structure build towards a buy in or restructuring.  At some point the trigger will be pulled and YA Global will authorize the transfer of these 10B shares to someone buying in.  Or they might remain locked up for a period of time or released tied to production goals.  Maybe this is in conjunction with the YA Global sale of their 80% share of  YA CORN OIL SYSTEMS.  In either case, by taking common rather than a new class of preferred - whoever is taking these new shares - the new entity does not seem protected (or worried) about future dilution.  That seems at first blush a good omen for common shareholders.  Whatever happens -  my guess is this is important and something will happen sooner rather than later.  Remember, the GE Deal was first announced mid December 2008;

"Tis the Season"

SkunK

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NOTE 16 SUBSEQUENT EVENTS {page 23 - 3Q)

Between October 1, 2010 and November 23, 2010, the Company issued a total of 843,612,286 common shares upon conversion of debt, as well as 10,000,000,000 shares of restricted common stock issued to Viridis Capital, LLC (“Viridis”) on November 19, 2010 upon conversion of 9,931 shares of Series D Preferred Stock held by Viridis, the Company’s majority shareholder. Viridis is subject to a lock-up agreement executed in favor of YA Global pursuant to which Viridis is prohibited from pledging, hypothecating, selling or in any way transferring its common or preferred stock in the Company including the shares described above.
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SERIES D PREFERRED STOCK {Page 40 Annual Report 10K/A}

Shares of the Series D Preferred Stock (the “Series D Shares”) may be converted by the holder into Company common stock. The conversion ratio is such that the full 1,000,000 Series D Shares originally issued convert into Company common shares representing 80% of the fully diluted outstanding common shares outstanding after the conversion (which includes all common shares outstanding plus all common shares potentially issuable upon the conversion of all derivative securities not held by the holder). The holder of Series D Shares may cast the number of votes at a shareholders meeting or by written consent that equals the number of common shares into which the Series D Shares are convertible on the record date for the shareholder action. In the event the Board of Directors declares a dividend payable to Company common shareholders, the holders of Series D Shares will receive the dividend that would be payable if the Series D Shares were converted into Company common shares prior to the dividend. In the event of a liquidation of the Company, the holders of Series D Shares will receive a preferential distribution of $0.001 per share, and will share in the distribution as if the Series D Shares had been converted into common shares. At December 31, 2009 and 2008, there were 799,954 and 800,000 shares of Series D Preferred Stock, respectively, issued and outstanding.