From the 8-K:
Every paragraph from that 8-K stinks. Here is one of the more entertaining ones, however:
On April 1, 1998, the Company entered into an agreement with Fletcher International Limited ("Fletcher") whereby Fletcher exercised a warrant to purchase 5,000,000 shares of Common Stock at an exercise price of $2.34375 per share for a total of $11,718,750. As an incentive for exercising the warrant, Fletcher was issued 1,696,429 shares of Common Stock (the "Incentive Shares") at par value. The written contract provides that significant penalties (including the issuance of a substantial number of shares of Common Stock) may be imposed on the Company if the Incentive Shares are not registered by October 10, 1998, or if the Company has insufficient shares of Common Stock to issue to Fletcher in accordance with the terms of the written contract. SyQuest does not have sufficient shares of Common Stock available to issue to Fletcher, although such shares will become available once the Reverse Stock Split becomes effective. (See, "Risk Factors Risk of Nasdaq Delisting"). The Company does not believe, however, that it will be able to register the shares of Common Stock by October 10, 1998. The Company may have legal grounds to dispute the imposition of such penalties, but if the Company did not prevail, the size of the penalty would be sufficient to cause the Company to fail to comply with the minimum $4,000,000 net tangible asset listing requirement of the Nasdaq National Market.
Take your pick of reasons why delisting is coming soon. |
