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Microcap & Penny Stocks : Diamond Entertainment Corp (Previously DMEC)
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To: Wes who wrote (6931)2/6/2000 5:39:00 PM
From: Ga Bard  Read Replies (3) of 6957
 
Ok ... I called James and asked what the **** is going on ... He told me he is trying to get the authorized up because with only 40M @ .10 average price he can only find a deal worth $4M to do a merger with, which is not going to find anything worth doing. Plus the merger would only give the new compnay 40% ownership and no one is going to talk about a merger without having control of the corporation. So he wants to increase the authorized to 600M so he can do a deal.

Now he is under the impression or legal advisement that when you do a reverse split to get the stock structure with in control that the authorized reverses also. Effectively according to him if he gets the Authorized to 600M and does a 10 to 1 RS that will make it 60M authorized. Also once he reverse splits the OS goes to 6M and 3.5M in the float. That will leave him 54M left in the authorized and the stock trading much higher to give the merger candidate control of the corporation.

Now he is not looking to do this right away but merely get the authorization to do so should he find a merger that would warrant the reverse split and merger. He is looking to get everything prepared and stablized prior to going to China or entertaining a deal here in the states.

I am going to look into this reverse split and the authorize reversing too. I will know on Monday. He has been legally advised that it is a New Jersey corporation and that is what happens. I do not know for sure so I can't say. If this is a requirement for an incorporated company in New Jersey then local state law takes priority.

He is not trying to hurt the stock ... He has gotten the overhead low and he has or is finishing up streamlining the business so he can find a strong merger. Remember, he has a lot of stock himself that is going to reverse also.

Now I have told him to just sub out the site and let a full service website business handle it all. Deligate the website ... Hoping that happens soon.

I hold no position at all ... just letting you know what I find out.

:-)

Gary
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