Greg,
My reading of the 8-K is that the deal is structured as much as possible to assure that the deal is an investment in th company. The vesting period, no guarantee of registration of the shares and even the designation of not transferrable on the certificates are all fairly explicit. The intent of the deal as an investment rather than for resale or redistribution is stated repeatedly.
I don't believe your question about selling common shares can be answered from the document, but that the closest hint may be in the following paragraph:
"(b) The Holder understands that the Warrant and the Warrant
Shares have not been registered under the Securities Act by reason of
their issuance in a transaction exempt from the registration and pros
pectus delivery requirements of the Securities Act pursuant to Section
4(2) thereof, and that such Warrant and the Warrant Shares, as the case
may be, must be held by the Holder indefinitely, and therefore, that
the Holder must bear the economic risk of such investment indefinitely,
unless a subsequent disposition thereof is registered under the
Securities Act or is exempt from such registration requirements. The
Holder further understands that the Warrant Shares have not been
qualified under applicable state securities laws by reason of an
exemption from such qualification requirements, which exemption depends
upon, among other things, the bona fide nature of such Holder's
investment intent expressed herein."
My read is that it would take registration of shares (or exemption of registration) under the Securities Act. What it takes to do that is a relevant question. I think there may be something to learn from similar deals in the past with other companies. I am aware of Intel purchasing MRVC warrants in the past and will review that document.
George |
