Packaging Plus Responds to Share Price Volatility
PLAINVIEW, N.Y., Jan. 23 /PRNewswire/ -- Packaging Plus Services, Inc. (OTC Bulletin Board: PKGP) announced today that it has received numerous inquiries from shareholders regarding the recent volatility in its share price.
The company believes that the recent decline in share price is primarily the result of substantial short selling by debenture holders, who have requested conversion of their outstanding debentures in common shares of Packaging. To date, the company has received requests for the conversion of over 16,000,000 million, free trading, common shares.
However, the company has been advised by its legal counsel, that many of the allegedly "offshore" debenture holders have breached the terms of the debenture agreements and accordingly, has terminated the conversion rights under the agreements. Further, a large majority of such share conversions would have, if issued, represented control block positions, subject to SEC resale restrictions, and would not constitute free trading shares.
The debenture agreements provided for the conversion of the debentures into common shares of Packaging, on defined terms, or alternately, at Packaging's discretion, full redemption by way of cash with an interest premium.
The company intends to vigorously enforce its rights under the financing and debenture agreements and is currently contemplating, if necessary, obtaining new financing to redeem the debentures.
Packaging currently has 9,900,000 million shares issued and outstanding, of which 3,700,000 are restricted shares.
PKGP is an integrated specialty business services company. It owns and operates APAC, a nationwide association of independent postal centers. The association provides access to business services and logistically convenient and cost effective delivery of goods worldwide. PKGP's other subsidiaries are engaged in advertising, logistical services, franchising and concierge services.
SOURCE Packaging Plus Services, Inc. |
