Brad;
You are correct.
The shell, when it finds its crab, will do one of two things. Either it will issue A LOT more shares, then do a reverse; or it will do a reverse and then issue a lot more shares. Take your pick.
In either case, count on the number of authorized being increased to accomodate (unless it is already really high).
Generally speaking, the shell gets about a 20% interest in the crab. This varies greatly, depending on (primarily): the 'value' of the crab and the value (cash, clean, and current) of the shell. Using the 20% number, shell issues 100 million shares to get crab. 125 million shares then reversed back to 12.5 million, or, 1 for 10.
You are now in at $1.00 per share. That could be good or bad. Who knows?
Question: Ever been to Las Vegas? Do you like it?
Does the shell have cash? If so it is very valuable. Without cash, the fact that it is "trading" may be as much a detriment as an asset. Assuming the shell has little to no cash, I believe that the current value of roughly $2.5 million (25 million dimes) is excessive.
Save your money.
Know what you are buying (know the crab).
Only do shell deals if you are a founder (i.e. part of the "new group that has taken control").
Best Regards, Steve |
