Confirmation

The SkunK wrote Mr. Kevin Kreisler and included the letter posted in the comment section this afternoon.  I asked "Can you confirm this is from GreenShift?" His answer: "It was."   Since it is confirmed I have reprinted it below. 

I also asked: 

"Can you add comments on the 1.9 billion gallons per year of licensed ethanol production?  Is it through the acquisitions and expansion of present customers, or is it new customers to be named at a later date?"

Mr. Kreisler's response :

"More than about 1.9 billion gallons per year of licensed ethanol production. None of it by acquisition or expansion with the exception of two smaller plants earlier this year."

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"We appreciate your concerns. I hope the following is helpful:


First, a reverse split is needed to comply with our loan agreements. Avoidable concerns with loan compliance will arise before the end of the year if our lenders require conversions of more than about $200,000 in debt per quarter, which is likely to occur. Action needs to be taken today to ensure that we have sufficient authorized stock to prevent any default events before they occur. Next, we are not allowed by law to issue stock at prices below the par value of our common stock ($0.0001 per share). Since our lenders have the right to demand and receive shares of our common stock at a discount to market prices, we are forced to incur costly penalties as debt is converted into stock. These penalties have the potential to be substantial depending on market conditions, and they will interfere with our ability to meet our stated 2011 goals unless we take action now."

"Significant recent market changes are also relevant. Various third party companies involved with the transfer of our common stock have implemented changes in their policies and procedures that have had a negative impact on all of us. For example, The Depository Trust & Clearing Corporation (“DTC”), a company responsible for all electronic transfers of stock, has ceased to provide transfer services involving many small companies including GreenShift. In another example, TD Ameritrade, Inc., as well as several other retail brokers, have refused to allow several of our shareholders to execute investment decisions involving our stock, citing the substantial cost of completing physical transfers (paper and mail) of our stock due to our ineligibility for DTC’s electronic transfer services. In still another example, in June 2011, Penson Financial Services, Inc., one of the largest of a group of companies that provides essential transactional services for transfers of stock, published a new restriction that it would not accept deposits of equity securities that are priced below $0.10 per share. Penson cited the “substantial additional requirements” it has historically absorbed as well as the increased cost and risk of providing clearing services for companies that do not meet Penson’s new criteria. It is possible, if not probable, that other clearing firms will make similar changes in the near future. These market changes collectively show a clear trend towards reduced market access for small companies with negative implications that we should all consider. A split can help to offset these concerns by reducing transactional costs for these entities while giving our stock the ability to meet third party requirements as they arise."

"Without a split, we collectively face increased risk of debt default, costly penalties for payments priced below par value, increasingly more stringent market restrictions, and reduced access to the equity markets. However, opportunity costs should also be taken into account. A key question here is whether we will be able to meet our goals faster or more cost-effectively with a split. Consider the last 90 days. Our annual report reported satisfaction of all of our goals for 2010, especially including our return to positive cash flow. Our March 31, 2011 quarterly report demonstrated significant additional progress, including another $7 million of debt reduction and our transition to operating income. We have won and announced significant new business, bringing our penetration to more than about 1.9 billion gallons per year of licensed ethanol production. And, yet, the price of our stock today is the same as it was six months ago, resisting appreciation in the face of significant progress and dramatically reduced debt conversions in 2011 as compared to prior years.

Finally, the split is also intended to facilitate additional debt reduction and further improvement of our balance sheet. Additional updates in this regard will be provided in the coming weeks.

Thank you for your continued interest and support.

Regards,
Investor Relations"
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SkunK