There is an old saying: "The enemy of my enemy is my friend". Funny, I don't seem to feel that way about you guys, still.
Let's say that we concede that, for the purpose of discussion, that CSMA does not/can not wipe out the 7.5MM shares that you allegedly control. Now, let's also say that you have 7.5 MM shares as a block of solidarity against HK and his buffoons. There is still an extra 18 mm shares out there!!
Moreover, look at this calculation.
25.5 mm shares total becomes 5.1 mm after the reverse split
18.0 mm shares held by others becomes 3.6 mm after the reverse split
7.5 mm shares held by the LPS/SeaSoilista rebels becomes 1.5 mm shares after the reverse split.
Now, I'll concede your 7.5 mm and I'll go another step further to plead your case. Let's say HK and crew don't have tight reins on all of their 3.6 mm shares. Say they only have control over 2.0 mm shares(10mm pre-split). Watch the magic of the dreaded reverse:
"Gee, HK, you only got 2.0 out of 5.1 locked up. What will you do?"
OK, class. Let us solve for D, the dilution variable, where D is the number of shares to issue to HK and his crew such that 2.0 + D becomes 50% +1 of the total outstanding shares. Using 8th grade algebra or trial and error, D works out to be 1.1 mm shares plus 1 .
And HK says:"Dang, and to think I used to hate those darn word problems when I was in schoooooool."
One pico second after the reverse takes effect, the Board can issue 1.1 mm shares plus 1 of 144 restricted stock and thus ensure 50% +1 ownership of the company.
Don't think HK and crew control 10mm pre-split shares? OK, give me a number and we'll solve for a different D. The point is this: Reverse splits and issuance of shares can be done by the company, without shareholder approval. He can't get CSMA to the NASD via the reverse but he sure can ensure majority control after the reverse. THEY WILL HAVE 50MM AUTHORIZED TO DRAW FROM AS THEY NEED!!
If in the unlikely scenario that he doesn't have control today, he certainly can get it quickly after the reverse...and that is even assuming that you guys get to keep your 7.5 mm!!
As I have said many times before, this management may be dumb...but they sure ain't stupid.
Your Utah based attorney needs to be very, very good if you want to even try and stop this. Otherwise, y'all are gonna need a bigger gun.
TG |
