This email is in response to your inquiry to Harvey Nachman of my firm.
I am the individual serving as Creditors' Trustee in the above-titled matter.
I am aware of recent trends in stock price and have heard various comments related to the use of the shell as a reverse-merger vehicle.
Because the bankruptcy case of Butler Services et al was dismissed, there is a clear division between the rights and responsibilities of the creditors' trust and the former corporate entity. That being the case, and because the company was woefully insolvent when the bankruptcy case was filed and likely moreso when it was dismissed, there is no value to equity and the stock, despite its trading activity, is valueless in any context other than someone willing to pay a higher price for it in a trade transaction.
If speculators are purchasing the stock for the purpose of using the shell as a reverse merger, they are welcome to do so to the extent that securities law and public policy permit that. However, as the company is insolvent, were I in their position, I would be concerned about the acquisition of the shell of an insolvent company absent a plan of liquidation relieving the shell entity of the debts; otherwise, the debts go with the stock and would attach to the post-merger corporation, essentially turning a healthy company into a debt-riddled company.
Regards,
Ted Gavin, CTP Principal NHB Advisors, Inc. Proven Expertise in Corporate Renewal 919 N. Market Street, Suite 1410 Wilmington, DE 19801 Office: ext. 151 Cell: (484) 432-3430 Skype: tedgavin Email: ted.gavin@nhbteam.com Web: http://www.nhbteam.com
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