Investor preferred bought at 50+% discount!
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Investor Preferred. On August 18, 1998, the Board of Directors authorized the issuance and placement of up to 100,000 shares of Investor Preferred with a stated value of $50 per share and a par value of $.001 per share, all of which were issued in connection with the capitalization of $5,000,000 of notes payable.
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The Investor Preferred will be immediately convertible into Common Stock upon the request of the stockholder on the basis of one (1) share of Investor Preferred for one hundred (100) shares of Common Stock.
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Letsee, 100,000 shares x 100 = 10,000,000 shares of common stock.
10,000,000/$5,000,000 = 0.50/share.
That's what Netvest/Haton thinks the stock is worth.
Pretty good deal, with the stock trading at $1.00-$1.50/share!
Shareholders are being asked to approve, in retrospect, the sale of stock to Netvest/Hayton which (a) gives them a controlling interest and (b) sold them stock at less than half price.
Here's another goodie from the filing, which acknowledges the discount:
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Investor Preferred
In December, 1998, 100,000 shares of Investor Preferred were issued for $5,000,000 consideration for forgiveness of advances made to the Company and amounts payable by the Company. The preferred is convertible into 10,000,000 shares of common stock. The market price of the common stock was $1.00 at the time of issuance resulting in a favorable conversion factor of $5,000,000.
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I guess "favorable conversion factor" is just another, more-palatable way of saying "half price". |
