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Microcap & Penny Stocks : OILEX (OLEX)
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To: Steve who wrote (3176)3/31/1998 2:35:00 PM
From: OFW  Read Replies (1) of 4276
 
Interesting Theory About Reg-S Financing

Steve, I noted with interest the following post that you made earlier today on the Henley Group (HNLY) thread, Post 1119. Considering your previous defense of Oilex as it relates to their long chain of Reg-S filings, I am most intrigued by your view of Reg-S filings when they are offered by a company other than Oilex.

Consider a theory of Reg S financing: A debenture is offered and is picked up by a non-US entity. This non-US entity is under no obligation to disclose its ownership structure. The debenture is convertible. The conversion options are exercised at a very low price after the market makers, chop shops aka (the recent investment firm) have driven the stock down further lowering the price because of dilution. A round of hype drives the stock skyward because most investors are unaware of the dilution. The converted shares are slowly unloaded during the runup. Catch: the non-US entity is actually owned by principals of the company whose stock was just sold but they are hidden through layers of subsidiary companies who are simply shells with mail drops. Beautiful. Great retirement package. What a golden parachute but its your gold.

Perhaps I am misunderstanding your intent, but it seems to me that if you have those viewpoints on Reg-S financing as they relate to another company, those concerns should also apply to Oilex.

Why the apparent double standard?

Offie
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