This excerpt taken from the FTK 8-K filed Aug 12, 2009.
Fractional Shares; Compliance with Laws
In connection with the conversion of any shares of Preferred Stock, no fractional shares of Common Stock will be issued, but the Company will pay a cash adjustment in respect of any fractional interest in an amount equal to the fractional interest multiplied by the closing sale price of the Common Stock on the date the shares of Preferred Stock are surrendered for conversion.
Before the delivery of any securities that the Company will be obligated to deliver upon conversion of the Preferred Stock, the Company will comply with all applicable federal and state laws and regulations that require action to be taken by the Company. All shares of Common Stock delivered upon conversion of the Preferred Stock will upon delivery be duly and validly issued, fully paid and nonassessable, free of all liens and charges and not subject to any preemptive rights.