Paunch, what is involved here? Is IPM going to offer "rights " to existing shareholders to buy shares in proportion to their current holding, or can I, a not current owner of IPM shares put $500,000 on the table for let say, 5 MM new shares at let say $.10.
In the both cases those shares will have to be registered. Since you have not obtained "backing" from more than 1 MM shares, you can assume that at best, you will have those 1 MM shares participating in the rights, even at $.25/shares it is only $250,000. Not enough to move a finger. Let be extremely positive here and assume that 10 MM shares would be bought at $2.5 MM ($.25/share), is that enough to satisfy the various lien holders and prove the property with a viable process?
Whomever organizes this thing better check with a securities attorney to make sure that no violation of the 1934 securities act and all its later amendments are violated.
Finally, if I were a share holder, I would need to see a detailed plan as to what is the minimum amount that would be accepted and what can be done (and will be done) with that money. Who is going to put that plan together?
By the way, if you go the route of rights, it would be illegal to nullify the shares of those people not exercizing their rights. The only way you actually can do that is by actually put IPM in Chapter 7 while you have funds from those willing to go ahead with you, and then buy what is left of IPM from the court appointed liquidator. I doubt you can "prepackage a liquidation. In any event, to raise the money, if not in the form of rights (through IPM) you will have to form a new company and this company will have to issue shares (namely one kind of offering or another, and if most the buyers are not accredited, an expensive proposition since even if it is not a public offering, it will have to be preregistered with most states and blue skied in all states where you'll have potential investors).
Good luck to you.
Zeev |
