As with most LONE press releases, this one is confusing from the shareholders perspective because it doesn't state where shareholders or the company really stand. Normally when a company announces bankruptcy, common shareholders are wiped out or retain a very small interest, which they must buy into, in the new company once it returns from bankrupcty. That seems not to be the case here. The idea of engaging in a reverse merger with a .com company, which may thusly gain a typical .com extraordinary market cap., and then using the company's interest in it to pay off their creditors must be a unique tactic and seems rather wild and daring to me. What a scheme! The press release seems to imply that once the company emerges from bankruptcy, our common shares will hold the same interest in the co. as before the bankruptcy declaration. This is really weird. LifeOne's assets appear to its three shell companies and whatever future cash flow might derive from the RICO suit. I wonder what shareholders in specific are will to pay the cost of the lawsuit. The Southerngroup? The Sun Co., whose mutual funds invested in LONE a couple years ago? First Madison Sec's? Help!!!
Monday December 6, 12:23 pm Eastern Time
Company Press Release
LifeOne Files Chapter 11 to Gain Protection From Litigation and Pursue Implementation of Business Plan
Reorganization Plan Designed to Pay Off Debenture Holders Without Issuing Additional LifeOne Shares
NORTH BETHESDA, Md.--(BUSINESS WIRE)--Dec. 6, 1999-- LifeOne, Inc. (OTCBB:LONE - news), (the ``Company'), announced today that it has filed a Chapter 11 for reorganization, which will stop all litigation against the Company and protect it from further equity erosion by certain debenture holders. With court approval, LifeOne will be able to pursue its business plan to increase shareholder value.
LifeOne has been stymied in its pursuit of providing equity growth to shareholders by court restrictions on its business plan arising from LifeOne's refusal to violate securities and insurance laws. LifeOne was held in contempt for refusing to escrow four million free trading shares of LifeOne common stock for Thomson Kernaghan & Co. LifeOne did escrow four million shares of restricted common stock and has continued to maintain that it complied with the court's orders except that providing unrestricted stock would cause it to violate one or more of the United States securities laws and applicable state insurance laws.
Litigation that has been initiated against various debenture holders regarding stock manipulation and violation of securities and insurance laws, will continue in full, with plaintiff stockholders funding the continuation of the stock manipulation lawsuit.
Shortly, LifeOne will file a plan for reorganization that is designed to pay off all of its bona fide creditors in full. As part of that plan, LifeOne has informed the Trustee that it is negotiating a reverse merger with an internet e Business solution provider. LifeOne's investment bankers are analyzing the transaction. LifeOne has received a preliminary appraisal of the internet company that establishes a market capitalization with sufficient stock value attributable to LifeOne to pay off LifeOne's unsecured creditors. When LifeOne emerges from the Chapter 11, it will still have three aged shells to build stockholder value and the Company anticipates that the current 17 million shares will not be further diluted by conversions of debenture holders.
Certain statements in this release may constitute ``forward looking statements' within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Certain but not necessarily all of such forward looking statements can be identified by the use of such words as ``believes,' ``projects,' ``expects,' ``may,' ``will,' ``should,' or ``anticipates,' or other variations or by discussions of strategies involving risks uncertainties. The actual results of LifeOne, Inc. or industry results may be materially different from any future results expressed or implied by such forward looking statements.
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Contact:
LifeOne, Inc.
Brent Chapel 301/984-0800
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