Carl, is this complementary analysis provided to us at your expense? If so, thanks! I have to review it well and verify the points raised. Bill Fischofer might be right in writing that ATCO at this point in time "has a very interesting story."
Until a licensing agreement is made with another company, the direction of this stock is either lateral or downward. My gripe is the company's proposal "To amend the certificate of incorporation to authorize 5,000,000 shares of preferred stock." Why? They have not made any progress with licensing the technology and yet they want to issue more shares?
Herewith is the section in the proxy relating to the issuance of preferred stock:
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PROPOSAL NUMBER 2: TO AUTHORIZE 5,000,000 SHARES OF PREFERRED STOCK.
The Company's certificate of incorporation, as amended to date, does
not authorize the issuance of shares of preferred stock. The Board of Directors has approved an amendment to the certificate of incorporation which would authorize the Company to issue a maximum of 5,000,000 shares of preferred stock, $.00001 par value per share.
Pursuant to the proposed amendment, the Board of Directors of the
Company would have the power, without further action by the stockholders, to divide any and all shares of the Preferred Stock into series and to fix and determine the relative rights and preferences of the Preferred Stock, such as the designation of series and the number of shares constituting such series, dividend rights, redemption and sinking fund provisions, liquidation and dissolution preferences, conversion or exchange rights and voting rights, if any.
With respect to voting rights, if the Preferred Stock were permitted to vote in the election of directors or on other matters, each such share would be entitled to one vote, and such shares may vote with the shares of common stock or may vote as a separate class. Issuances of Preferred Stock by the Board of Directors could result in such shares having dividend and/or liquidation preferences senior to the rights of the holders of common stock and could dilute the voting rights of the holders of common stock.
The purpose for the authorization of the Preferred Stock is to allow
the Board of Directors the flexibility to tailor classes of equity securities to particular transactions or needs as they may arise, without returning to the stockholders for authorization in each such instance. Obtaining shareholder approval for any matter is cumbersome, time-consuming (at least 60 days) and quite expensive. Preferred Stock is often useful in acquisitions, business combinations and financings. Neither management nor the Board of Directors has any plan or intention to use the Preferred Stock as a defense tool in any takeover of the Company should a takeover be threatened.
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Does anybody have any comments on this proposal?
Regards,
SunAge |
