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Microcap & Penny Stocks : Rocky Mountain Int'l (OTC:RMIL former OTC:OVIS) -- Ignore unavailable to you. Want to Upgrade?

To: Ditchdigger who wrote (23169)	12/2/1997 8:14:00 AM
From: Ellen	Read Replies (1) \| Respond to of 55532

To: The Ditchdigger (4687 ) From: Ellen G. Sunday, Oct 12 1997 3:46PM EST Reply # of 23169 "As of November 2, 1995 the Company, through a subsidiary, acquired all of the outstanding shares of Nelson International Corp. (Hialeah, Florida) and Baron's Internacional, S.A., a textile manufacturing business located in Managua, Nicaragua. The consideration for the acquisition was 300,000 shares, valued at $1,500,000. As part of the acquisition, the Company assumed part, but not all of the acquired companies' liabilities which aggregated approximately $253,000. The total purchase price of $1,753,000 was reflected as property, plant and equipment. As part of the agreement, the Company warranted that the issued shares (which are restricted under Rule 144) will have a value of $1,500,000 at the end of the holding period. If the value is less than $1,500,000, the Company, at its option, may pay the difference in cash or additional shares. The sellers warranted that the equipment in the two factories will appraise at a value of no less than $1,000,000 or the purchase price and warranty will be adjusted accordingly. Current management questioned whether the share value was properly computed and therefore in January 1997 engaged an independent appraiser to determine whether amounts recorded in the financial statements properly reflected the fair value of the assets acquired. In as much as there were detailed listings of the equipment acquired, the appraiser through study and inspection was able to provide a value for the equipment at about the time of the acquisition. The appraised value aggregated $741,085. The equipment acquired has been retroactively adjusted to that amount with an equivalent adjustment to goodwill. As of June 30, 1996, management determined that the goodwill described above was significantly impaired and accordingly was charged to operations."

To: Ditchdigger who wrote (23169)	12/2/1997 8:20:00 AM
From: Ellen	Respond to of 55532

In Jan 97 :In as much as there were detailed listings of the equipment acquired, the appraiser through study and inspection was able to provide a value for the equipment at about the time of the acquisition. The appraised value aggregated $741,085. Glad you already picked up on this fact. Note: appraisal appears to have been done 14 months after the deal was done(most recent appraisal). IMO, one would think there was an appraisal done at the time of or prior to the deal completion.Who did the original appraisal? Am I correct in assuming the 300,000 then went through a 1-30 reverse split,resulting in 10,000sh? At that time outstanding was 9m+ I honestly don't know. But don't recall in the filings that any qualifications or exceptions to the split were cited. Seemed to be a straight, across the board split. So I would think, yes, these shares also underwent the split.

To: Ditchdigger who wrote (23169)	12/2/1997 8:21:00 AM
From: Ditchdigger	Respond to of 55532

Simple and fair solution, Make both parties live up to the obligations set forth in the contract. Nelson/Baron's should have to pay the difference between the appraised value of $741.085 and the $1,000,000 required equipment value. ie. Nelson pays RMIL $258,915 per their agreement. At todays value( or based on Jan prices as appraisal was) $2.00 X 750,000 sh.=$1.5m. RMIL should issue shares to Nelson/Baron ,whatever number of shares to bring Nelson's shareholdings to 750,000 sh. ie, if they hold 300,000 give'm 450,000sh or if it was split and they hold 10,000, give'm 740,000sh. Then both sides have met their obligation per the agreement-fair,is fair.. DD