3Power Energy Group Inc (PSPW)

[enthalpy]

One option for 3POWER because the insiders own 85% of the company is debt assumption. Generally an entity or individual can perform a debt assumption in which you can pass debt from one entity to another. This is all 3Power insiders would have to do and the debt would be wiped out and a clean slate. This is a common practice. The insiders can play hard ball with the recent settlement and get it reduced as well. A recent Pink Sheet example is US Fuel Corporation which is in the process of uplisting to OTCQB (odds are about 1 out of 800 the way they are doing it with the 12g voluntary delisting). Insiders of that company who own a huge chunk of the company just did a debt assumption. I believe close to 10 million dollars was written off the books legally.

Just saying these are the special financing situations that the WEALTHY insiders of 3POWER will probably end up doing too just prior to announcing financing but we wont know about it until the 10Qs come out 45 days later.

Were are sitting good now that Seawind bankruptcy proceedings have been finalized.



Definition:
Debt assumption is a special form of debt refinancing, involving three parties—the creditor, the original debtor, and a new debtor who assumes the debt obligation.

A debt assumption involves two simultaneous transactions; the first transaction cancels the original debtor’s obligation, and the second transaction creates a new debt contract between the creditor and the new debtor, or assumer.

The first transaction is classified as a capital transfer (as in the case of debt forgiveness), and the second transaction involves the creditor’s acquisition of the new debt instrument issued by the assumer. Any write-down of asset value by the creditor is recorded in the revaluation account.

http://stats.oecd.org/glossary/detail.asp?ID=550