GNCC Capital Inc (GNCP)

[TenKay]

There are two sets of "rules" governing buybacks. SEC Rules and those from the State of Incorporation. Rule 10b-18 is an SEC rule and provides protection or "safe harbor" to an issue if they affect a buyback within the confines of the rule. The protection is against violations of market manipulation rules. If they don't affect the buyback as required by 10b-18 in order the get the protection...they can be exposed to market manipulation issues.

On the state side it is a little different. As was pointed out by a number of us when they first announced the buyback under DGCL...we said they could not do it because they did not meet DGCL's requirements. For example the company's capital is impaired..and DGCL will not allow a buyback when that is the case.

Eventually, it appears, they came to the same conclusion and decided to switch to Wyoming....which has no such Capital protection requirements.