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Correction to my previous post: Auditors for HCPC are Webb and Company, P.A., Certified Public Accountants.
http://www.cpawebb.com/
GLTA
Read the PR.....
Firstly, didn't they just issue a PR actually naming the 3rd party auditor (CA Webb) who is carrying out the audit? Not just a vague statement such as, 'an audit is being carried out by an independent (3rd party) firm of accountants.' Previously, the only verification that an audit was being carried out at all was the brief comment from Carol in the WallSt.net interview and some people here relaying their conversations with Rick (IR).
Secondly, I checked the regulations for up-listing to OTCBB requires 2 years of audited financials + up-to-date current filings for up-listing. So we could up-list to OTCBB, be fully reporting, and have a share price of 0.0002. This is an option imo.
Thirdly, checked the regulations for up-listing to OTCQX Prime (Pink Sheets) and it also requires 2 years of audited financials + up-to-date current filings for up-listing. So we could up-list to OTCQX Prime at some point, be fully reporting, but the share price would have to be greater than 25c (and remain above that figure) for at least 90 days before an up-listing would be accepted. This is a regulation for up-listing. So I don't think HCPC would apply to OTCQX Prime unless they were comfortably above that 25c figure, not just hovering just above it imo. Regardless, we would need to have a share price greater than 25c. So even, for arguments sake, they did carry out a huge RS to try and get the price up to meet this price, it would have to be sustainable. Without solid fundamentals I think the PPS, would plummet back down before that 3 month period was reached imo.
So, either they become a fully reporting Pink Sheet Stock first (staying on the present tier), work on building the company, the PPS, initiate the buyback and in time apply for an up-list to OTCQX Prime. If they got the price up significantly from present levels with this approach, I have not ruled out the possibility if a moderate RS before up-listing to OTCQX Prime, although I know many would not welcome that approach. C'est la vie. Or they apply to OTCBB first with no minimum share price requirement and maybe transfer to OTCQX Prime later on when PPS has increased (again, with or without the aid of an RS). The other possible option imo.
Either way, carrying out an audit means up-listing or no point in spending money on the audit imo. My simple conclusion: that is good imo:)
Forth point. It would not surprise me if they have been recently advised by the accountants/ auditors, not to put out the first Q 2008 financials at present imo. Think about it. The company needs to know that the previous 2 years accounting has been audited correctly first, before HCPC can produce first Q financials with any certainty that they are based on correct figures and are accurate. If 2006/ 2007 numbers are still being checked by the appointed auditors, how would they know that there will be no adjustment needed in the bottom-line figures for 1Q, once these previous years have been completed? The foundation has to be correct before they produce the most recent Q financials. It seems logical to me anyway. Rick may be IR, but he is not doing the audit. Maybe he just got it wrong. It wouldn’t be the first time someone within an organization didn’t quite know what was going on. I work with that scenario on a daily basis. We don’t live in a perfect world.
Ok, these are my thoughts. Take them or leave them. I am certainly not here to convince others or be convinced. Will skim through the day-to-day drama here, extract the useful bits and contribute when I can; but it won't make much difference to me, as the big picture has not changed imo.
GLTA
From last year..repost as some problems with link on website:
Great find Cash:)
Well the first three add up to $673 million..mmmmm..pure speculation imo:)
http://investorshub.advfn.com/boards/read_msg.asp?message_id=28492733
Bit more speculation here. Check out second figure on the list of your post from Fitch December 21st 2007:
Extract:
Fitch Affirms All Classes of JP Morgan 2006-FL2
Fri Dec 21, 2007 1:15pm EST
CHICAGO--(Business Wire)--Fitch Ratings affirms the following classes of JPMMC 2006-FL2
commercial mortgage pass-through certificates:
--$340.6 million class A-1 at 'AAA';
--$298.3 million class A-2 at 'AAA';
--$34.1 million class B at 'AA+';
..................
against the sum in this HCPC pr from March 5th 2007....:
http://heritagecapitalcreditcorp.com/sitebuildercontent/sitebuilderfiles/HCCCPreparesCommercialProjects
PRESS RELEASE
Heritage Capital Credit Corporation Prepares Commercial Projects
for BCLOC Trust Funding
Wilmington, DE – March 5, 2007- Heritage Capital Credit Corporation (OTC:HCPC)
announced today that after four years building an origination infrastructure, its subsidiary
Independent Capital Credit Corporation has 10 of its original 26 customers’ commercial
projects ready for pre-closing and funding by the BCLOC Trusts. These transactions total
$298 million. Independent Capital Credit Corporation anticipates adding more of the
original customers’ commercial projects to the list or replacing them with new ones in
order to reach the total funding obligations of $740 million.
Each commercial project loan is processed using a national rating agency’s guidelines
and seeks a shadow rating before it is placed into the BCLOC Trust Special Purpose
Entity, which is controlled by an affiliate and is wrapped with a financial guaranty
contract to protect the institutional investors from loss of principal and interest on the
securities. The Special Purpose Entity is a business formed by the affiliate solely in order
to accomplish the specific task of funding the BCLOC Trusts, which will fund the
commercial projects.
The origination infrastructure is only possible because of the original Heritage Capital
Credit Corporation shareholders who have invested approximately $3 million over the
past four years. This unique infrastructure allows no default before the customers’
commercial project loans mature and no loss to the investor that funds each BCLOC Trust.
GLTA
Great find Cash:)
Well the first three add up to $673 million..mmmmm..pure speculation imo:)
Bit more speculation here. Check out second figure on the list of your post from Fitch December 21st 2007:
http://investorshub.advfn.com/boards/read_msg.asp?message_id=28492733
against the sum in this HCPC pr from March 5th 2007....:
http://heritagecapitalcreditcorp.com/sitebuildercontent/sitebuilderfiles/HCCCPreparesCommercialProjects
GLTA
I can ask for, 'half a pound of mincemeat' in Dutch, but don't know how to get that into a conversation about HCPC:)
GLTA
Knew you'd be one step ahead....:)
Good finds....
Maybe William is on The Cremel Group Board as well?:)
GLTA
Think Thomas A Harman may have discussed things with his brother William, before getting involved with The Cremel Group, HCPC and RELM?:)
GLTA
Good find Cash:)
Thanks Cash........good to know you're on the case:)
Neil
I agree Cash...as I've dug into it over the last day I increasingly see that connection to The Cremel Group....
HCPC talked about merging with a London insurance company last year that didn't materialise. Looks like Thomas A Harman is from the insurance industry, involved with Cremel as a Senior Board Member, and also FLFC. The Cremel Group suddenly has a lot of capital. Incorporated in 1994 it was a shell imo for years. Wondering whether we could still see a the link with the insurance industry in some shape or form and the capital coming from contacts HCPC, FLFC and Jim Aspinwall have there? If The Cremel Group has become capitalised by some means (maybe high net worth individuals/ a private company/ several companies taking a share of The Cremel Group ownership?), then HCPC would not need to merge with a conduit lender as was mentioned before (but now stated by IR that HCPC are not planning on a merger), as the money is already 'in the house' so to speak:)
GLTA
Interesting cash.....think Jim Aspinwall knows what he is doing here. HCPC seems to be working hard to get the various pieces together to support their business IMO
GLTA
Thanks Milo:)...you could be right about the Cremel public/ retail buying imo...
We know:
- Thomas A Harman was involved in FLFC in October 2007 (see link in earlier post)
- Thomas A Harman is Executive Vice President of The Cremel Group (which owns $150 million of preferred shares in RELM)
- GSR became available around October 2007
- HCPC is offering up to $1 billion of preferred shares
- The Cremel Group ownes shares in HCPC (not sure yet how many)
- HCPC Financials for 3Q (end September 30th 2007), published 13th November 2007 changes it's format and individual shareholder ownership no longer available....why?
- Buyback in HCPC began in December 2007 according to Geaux Fish TA and continues for at least the first 3 months of 2008.
And finally, THAT interview on WallSt.net on September 20th 2007:
CAROL: Well, we have a new funding source and funding for loans appears to be imminent. I want to ask our investors, our shareholders and our potential investors to stay with us until after we reach our milestone by holding and taking long positions. We in management believe there will be reason for you to keep your eyes on us for a long time.
And finally finally from that interview:
MIKE:
And are there plans to move to a higher exchange once you are fully reporting?
CAROL:
Absolutely. Those are two of our goals for 2008. I had hoped we could accomplish them in 2007, and they are top on the priority list for 2008.
MIKE:
Great. So for 2008, we’re looking for the closing of the $700+ million in loans, the fully reporting and the up listing so this is going to be a big year for Heritage.
A lot seems to have happened in the last quarter 2007:) Think that is when the big money arrived imo...
GLTA
Ha thanks Libra...it's all good:)
Thanks for yours too....:)
GLTA
Interesting Cash, thanks for the reminder:)
Well I think they (The Cremel Group) will own quite a few imo:)
Interesting that we see Thomas A Harman mentioned with FLFC in October 2007, about the same time as the GSR came back on the market. FLFC looks active then and as someone (Cash?) mentioned earlier, they have a serious organisation chart waiting for names to be added.
http://www.firstlifefinancialcorporation.com/index.html
Thomas A Harman,representing FLFC, October 2007.....link to attendance at the Delaware Captive Insurance Association Annual Conference....he must be from the insurance industry then, to attend that imo (found first by CREEP I think):
http://www.delawarecaptive.org/2007_conf_reg_list.htm
We see him linked with The Cremel Group in the LOI with RELM for the sale of Relm REH from The Cremel Group to RELM.
Think The Cremel Group may now be the company that owns HCPC, RELM, FLFC and all the other related companies.....imo of course:)
More thoughts.....this may be why we won't find much on The Cremel Group. Think this was another 'shell' company set up in 1994 by Carol Johnson and/ or Ed and it only became operational when the 'big money' arrived. The Cremel Group could then have been capitalised to the value of $150 million as the deal with RELM suggests. Thomas A Harmon could be fairly new on the scene and become the Executive Vice President. He was mentioned as being linked with First Life Financial Corporation (October 2007)
http://www.delawarecaptive.org/2007_conf_reg_list.htm
There could quite feasibly be other board members of The Cremel Group that we have not heard of yet.
The Cremel Group could have been capitalised to much more than $150 million. If so, it could be the conduit through which HCPC is being capitalised as well, through the sale of it's preferred shares. If so, The Cremel Group may be the new mothership of both HCPC and MERL.....imo:)
GLTA
First RELM Real Estate:
http://www.relmholdingsinc.com/id2.html
Extract:
"RELM REH, through a wholly owned LLC, has signed a purchase contract to acquire a 68,000 square foot office building and, through another wholly owned LLC, has signed a non-binding letter of intent to acquire a 27-story 1995-room hotel"
Now the from Letter of Intent for RELM (previously MERL see recent ticker change) to buy Relm REH from The Cremel Group.
http://pinksheets.com/otciq/ajax/showFinancialReportById?id=14103
Extract:
"Purchase Price: The Purchase Price ("The Purchase Price") for 100% of the Outstanding Shares will be $150,000,000 paid in class B convertible preferred stock of the purchaser. This purchase Price is based dollar for dollar on the internal pro-forma equity valuation of the company, which was based on the Company's anticipated closing of two transactions currently under contract."
The last sentence is interesting.
"This purchase Price is based dollar for dollar on the internal pro-forma equity valuation of the company, which was based on the Company's anticipated closing of two transactions currently under contract."
The equity valuation of 'the company' being Relm REH, owned by The Cremel Group, which anticipated closing on these two deals. Are the two deals GSR and 1300 Market Street? Or 1300 Market Street and another in the pipeline?
You don't pay $150,000,000 in preferred shares for a shell. 'Anticipated' suggests that the closing were in progress at the time this Letter of Intent was drafted. I think the Cremel Group somehow must have had the capital to put up for the purchase of the properties by Relm REH(well actually, I think it was for purchase of part of the properties......GSR valuation is much higher than the $150 million valuation given here, unless the two properties were for two buildings excluding GSR, 1300 Market Street + one other yet to close?). Thoughts? The Cremel Group was incorporated in 1994. I think it must have lay dormant up until recently. RELM was mentioned more recently on this newsletter:
http://firstindependentfinancialgroup.com/sitebuildercontent/sitebuilderfiles/vol1issue2.pdf
Extract:
RELM REAL ESTATE HOLDINGS
works in tandem with
other organizations to form partnerships
for large multi-family
housing projects
RELM REH, however, did no business until recently imo. It was just a sister company to HCPC, but no more than a shell. I think Carol found investors willing to put up significant capital imo for the purchase of real estate (Thomas A Harmon for one?). They used The Cremel Group as the vehicle for that capital and presumably arranged Relm REH as a subsidiary to it for the purchase of the real estate.
Someone/ organisation must have had c. $150 million to purchase the two properties/ real estate through the Cremel Group, using Relm REH as the vehicle for ownership. They also saw the value in exchanging them for convertible preferred shares in the deal with RELM imo. They will almost certainly get a dividend on the preferred shares, but in the end someone may/will end up with shares in RELM....and probably a majority position. RELM has been capitalised to the value of $150 million imo.
Which makes me think.
- RELM issues convertible preferred shares worth $150 million to The Cremel Group in exchange for Real Estate worth the same amount (read RELM LOI for precise details of amount/ conversion). We do not know the conditions of these convertible shares to RELM common shares, but they may end up as a significant/ majority holding of RELM common shares? The Cremel Group has Carol on the board + Thomas A Harman as EVP. The Cremel Group must have gotten that capital injection from somewhere.....Thomas A Harman...and friends?
- HCPC issues convertible preferred shares for cash. Possibly up to $1 billion worth. Again, the holder (s) will end up with a significant stake in HCPC, with regard to common shares. The capital is used to fund real estate loans, some real estate deals to third parties but the majority in terms of dollar value at least, for RELM related deals including GSR.
Where is the source of these cash injections coming from? The fact that both RELM and HCPC seem to suddenly be able to access major amounts of capital at the same time seems more than coincidental. Could it be that the money coming into RELM through the selling of convertible preferred shares, is likely to be the same as coming into HCPC?
Someone will probably have a majority equity stake in RELM's real estate business upon conversion and a majority stake in HCPC's business upon conversion.....they could be one and the same imo....but we'll have to wait and see:) Any ideas?
GLTA
Interesting Cash....
Previously First Independent Financial Group (FIFG) was the majority shareholder of HCPC (and HCPC had one subsidiary in ICCC).
Wonder whether Cremel, which has Carol on the board, could be the new mothership?:).....If so could they have a controlling interest in both HCPC and RELM by now....?
Just some thoughts...
GLTA
I think we will in the audited financials.....well we should see those with shareholdings above 5% at least + all the insider holdings imo. Think we will also see those who bought RegD shares imo.
My thinking is that they changed their financials statement format for 3Q 2007 onwards to hide the identity of current major shareholders. One reason could be that someone (3rd Party?) was accumulating during this period and they were keen to hide their identity.....if so will be very interesting to see more detail in due course.
Going through the audit and publishing full financials again may mean that they have reached a point where they no longer need to 'hide' that info. The accumulation/ ownership may be done to their and the companies satisfaction. If this is the case, the audited financials could make for some very interesting reading imo
GLTA
Good news, when they come out we will have independent 3rd Party verification on the loans closed to date.......that will do for starters:)
GLTA
Hi Cash,
No, I think that info would be just between the company and the investor.....wouldn't surprise me if there was mind you...
Neil
GLTA
http://heritagecapitalcreditcorp.com/Wallstdotnet_Intereview_31308.pdf
From 13th March 2008
Extract:
"Carol: We’re glad 2007 is over because we see great things for in 2008. We posted our preliminary financials and we call them preliminary, because we are in the midst of an audit as we speak."
No reason to spend money on an audit unless you plan to uplist imo....
GLTA
Audit and uplisting:
We know Pink Sheets OTCQX Prime Tier operates a minimum bid price of 25c as part of the requirements of uplisting, as well as audited financials with SEC.
However, the OTC Bulletin Board (OTCBB), whilst requiring audited financials with SEC has no minimum bid. This could possibly be an option open to the company in the short term and a reason for the audit being carried out now, to enable them to become fully reporting imo:
http://www.otcbb.com/faqs/otcbb_faq.stm
Extract 1:
What are the "listing" requirements for the OTCBB?
Because the OTCBB is a quotation service for FINRA Market Makers, not an issuer listing service or securities market, there are no listing requirements that must be met by an OTCBB issuer. Accordingly, there are no financial requirements and there is no minimum bid price requirement.
Extract 2:
What is the difference between OTC, other-OTC and OTC Bulletin Board (OTCBB)? And where do the Pink Sheets fit in?
An over-the-counter (OTC) security is generally considered to be any equity security that is not listed on NASDAQ, NYSE or Amex. The OTCBB and the Pink Sheets are both quotation services for OTC securities. NASDAQ operates the OTCBB service and permits FINRA members to quote any OTC security that is current in certain required regulatory filings (see Listing Requirements). The Pink Sheets is a privately owned company that permits FINRA members to quote any OTC security and does not maintain regulatory filing requirements. An OTC security can be dually quoted on both the OTCBB and the Pink Sheets. As well, there are many OTC securities that are not quoted on either the OTCBB or the Pink Sheets; however, they have trading symbols assigned to them so FINRA members can comply with trade reporting obligations and report transactions in these securities. These securities are sometimes said to be on the "gray market".
GLTA
Yahoo Industry Pages for Mortgage Investment and Regional Banks (North East).
http://biz.yahoo.com/ic/411.html
http://biz.yahoo.com/ic/447.html
Intesting when you look at book ratios etc. My thinking is that HCPC should be able to achieve a price to book ratio of at least 1 in future......don't think that is unreasonable imo.
Also, just looking for some 'comparables'.....interesting when you looks at revs and total market cap/ book value of this company as annual revs for the last year are similar to those projected by HCPC, if they can sell the BCLOC securities and get 5% on the total amounts.....share structure is obviously very different...not saying a direct comparison (different exchange etc) but worth looking into industry averages and other companies to see how they are valued and in turn how HCPC may be valued by the market in future.....imo:
http://finance.yahoo.com/q/pr?s=cmo
GLTA
It's that kind of misleading pr that give HCPC a bad name.....we all know that IR (Rick) could not answer 17 emails, 12 phone calls in 22 minutes............why is it that HCPC, and Pinks in general, think they can put out ridiculous inflated numbers and get away with it..........?;)
Content to be patient here and wait to see things unfold in time. If the next pr was Decemeber 31st 2008 and stated that this year they had closed and funded c.$800 million in loans, been audited and were now fully reporting, I'd take that:)
GLTA
Hey Cash...think that is the preferred shares approved by the board is January 2008
GLTA
Milo,
Agree totally, the conversion of preferred shares will begin in the next 12 months and has to happen at a decent price to stop us/ and the investor being inundated with lots of those pesky common shares:)......the next few months will be interesting to say the least......I think some major events will happen this year as the game-plan unfolds and by some means the PPS will be transformed from where it is at present.........just can't wait to see how that happens.....:)
GLTA
Agree, I think they would wait and see where they could get the pps to first, assuming the float is much smaller, through BB/ accumulation by them (via a 3rd party possibly/ related company as suggested), before considering any other options.
If they could get to $0.25 with that method. I'd certainly take that:)
Need to be mindful also of the affect of the preferred shares converted to common shares within a 12 month period and their potential impact on pps and any uplisting they may have achieved in that time on OTCQX Prime etc.
GLTA
Haha...we've got George Clooney lined up to play you:)
GLTA
Hey Crooner...
Well Cash asked for some numbers....so you can blame him:)
Neil
GLTA
Hey Milo,
Agree with you that the company is controlled by outside investors based on those numbers. What we don't know is who those major holders are. There is a possibility that connections close to the company/ or related companies are buying up/ hold these shares....in effect a buyback, but by others.......no way of knowing for sure. If not, then yes you are spot on that they would have to be closely controlled.
Second point on float makes sense and yes you are right, they would buy from the float and retire those shares. The point I was trying to make was how in addition, they would also work to get the OS down without an RS? It has been suggested they could retire some of their own shares voluntarily, but I just don' see that happening imo and no, they would not sell at this level for sure.
GLTA
Agree totally Cash. There is a great DD team here now and don't forget Brent, that you have provided great input too....:)
GLTA
Interesting Cash...and thanks.....well if there is major accumulation going on, as we think there is, then it would not surprise me if it is from someone in the 'know'......and Cremel or similar would certainly fit that description:)
GLTA
Agreed......RS have a bad name on the pinks, and rightly so, as they are usually followed by further dilution and the price drops back down again......if however, as you say, it is carried out for up-listing purposes and is supported by strong/ improving fundamentals and no further share issue, then it can be beneficial imo. Others will disagree, but personally I'd rather get to a higher exchange, and in my lifetime preferably, than hang around on the basic level pinks forever.....
GLTA
I think it is possible yes. Something is happening in terms of major accumulation at this level......check out Geaux Fish's posts and the charts for more information.......the key issue for me is not just the OS, but who owns the majority of those shares? That would have a big effect on availability of shares when the news hits.....I think management at HCPC are smart and have a game-plan in place.....when the accumulation is complete, the pr's will come and the run will begin imo. Insiders hold a lot of shares, so I think they have a vested interest tp see the pps head north.....but when they are ready:)
GLTA
Hi limeyone,
Thanks for comments....glad to see some discussion here on this....
My concern would be how they 'double their assets'? The next $1 billion say, would have to come from somewhere......they are selling preferred shares to raise up to $1 billion....which upon conversion would increase the OS......so if they wanted to raise more capital would not the same situation arise with regard to increased OS?
If they buyback a lot now, then I agree the overall OS could be lower than I stated, but they would have to buyback and retire to the treasury. That would reduce there overall % ownership in the company.
Example:
OS 7.5 billion
Insiders 2 billion
3rd Party/ Merger Partner 3.5 billion
General 2 billion
There % ownership (Insiders + 3rd Party....which we think maybe accumulating at present) = 73%
In effect they may already have been carrying out a BB but through a third party.
So if they retired a % of the overall OS (their holdings) a % of ownership also decreases......not saying they won't include this in the overall scheme of things, but it may be part of a bigger plan.
If they do a 10:1 RS, their % ownership stays the same......as does ours, as long as no more shares are issued
The other factor is that a buyback after conversion could be expensive....if we are talking about 5c a share, a billion shares is $ 50 million......
The final factor in all this, which I think we need to consider, is the people who are putting up the cash......up to $1 billion........they must have been reassured with regard to a) risk and b) reward. I think moving forward that HCPC will need to attract a different kind of investor.........there are pink traders who wouldn't touch anything with an OS over a billion...me included when I started out on this one:)...so share structure must be an issue they address and how long do they wait to address it through a buyback? The second issue is that it is not just share structure but becoming fully reporting and being on a 'better' or higher exchange. I think people/ companies putting $1 billion into HCPC would have that as an expectation/ goal. You don't put in that kind of major investment to hang around on the pinks for 2 or 3 years imo. It's more like Mad Max than Wall Street down here at times:)
The first level in terms of step up in exchange is OTCQX Prime with a minimum of 25c. Then OTCQX Premier with $1.00. With an RS of 10:1 (Scenario B in my earlier post), HCPC/ we could possibly achieve OTCQX Prime fairly easily and also not be far off Premier.
Ok, I want to push the boat out a little bit further. How many people here would prefer to be listed on AMEX?:)......think the people putting up $1 billion may rather be on something other than the Pinks?
Extract from Scenario B: Best Case Scenario
"So if OS = 1.35 billion shares
$850 million Market Cap = $0.63 share
$1 billion Market Cap = $0.74 share
This remember, is all based on an 10:1 RS and after Preferred Shares are converted. And assets are factored in as well as potential earnings."
Ok, based on those figures and knowing AMEX has a minimum bid of $2.00 as well as many other uplisting requirements.
3:1 Reverse Split
OS = was 1.35 billion shares is now 450 million.
$850 million Market Cap = $1.88 share
$1 billion Market Cap = $2.22 share
Ok, maybe getting ahead a bit, but just trying to show that an RS, if used correctly, could get us to a higher exchange, with a better share structure and mainatin the same % ownership for HCPC and us...and in a much shorter timeframe..........but,...... and a big but.........share price MUST be supported by strong and improving fundamentals. They would want that to happen themselves, because if share price is supported and goes up, they win.....and so do we...:)
GLTA
hey bill,
thanks for the feedback.....:)
will try to keep this one simple.......you have to factor in assets......they cannot achieve those earnings with thin air, they are based on assets. And those assets are cash generated by the company through the sale of convertible preferred shares.......to fund the loans (estimated at c.$700 million worth at present).....when the cash is used to fund the loans the title to property then becomes the asset that HCPC hold.....title to property/loans worth $700 million on top of which they also get earnings.....I was here long before you arrived, and by the looks of it I could be here long after you leave.....:)
Have a good weekend...
GLTA
Hey Josh,
Thanks for the feedback.
From HCPC filing on 03/06/2008
http://www.sunbiz.org/pdf/00058704.pdf
I've inserted my comments in the text...:
Page 4.
"1. Designation and amount. The number of shares constituting the series of Preferred Shares Shall be 1,000,000,000"....... (NEIL: The total number of preferred shares that the company can issue in this offer)........ "which number may be increased (but not above the total number of authorized shares of Preferred Shares)".......... (NEIL: Agree with your take on it, a little ambiguous because they did not state what the revised AS for preferred shares is. In the previous filing they stated an AS of 10 million preferred shares, however, with this new issue that is exceeded......so can only guess but assumption is that AS is 1 billion for now, but we should try and check this with the company........the AS for preferred shares could be more, 2/ 3 billion etc. or it could be 1 billion....we do not know for sure imo...the point of their statement is that they can't issue anymore Preferred Shares than the AS of Preferred shares allows imo)........." or decrease (but not below the number of authorized shares of Preferred Shares then outstanding) by resolution of the Board Of Directors."..........(NEIL: My take is that they do not have to offer all 1 billion preferred shares, they could issue less..but not less than the number already issued........which is common sense but that's lawyers for you:)
I had to read and reread this many times before I understood it...well the way I see it anyway.
When you mention 1, 010, 000,000 that is the assumed AS of preferred shares. Correct me if I am wrong, but I think that is the limit of the total number of preferred shares that the company can issue and not the limit for how many common shares those preferred shares can be converted too. If the share price was $1.00 then the amounts would be the same. If the share price is less it would be more. The only factor that would limit the conversion to common shares would be the AS of common shares. Currently set at 10 billion. In the example I gave when the OS could be up to 15 billion after conversion, they would obviously have to increase the AS of common shares to accomodate.
Hope this helps......have a good one too:)
GLTA
probably a wise decision:) not saying I am spot on, but you do need to assess assets in the calculation as I tried to do.....the holders of $700 million in preferred shares, that provided the $700 million in capital to HCPC, to fund the loans, would not be too happy if HCPC's share price was only based on earnings.........considering all the preferred shares will be converted to common shares in 12 months:)
Have a good weekend all...
GLTA