PC can you explain the following excerpts from the 8k from last summer below? It looks like Stevens will get 9% of the outstanding. What would current holders get assuming the share structure didn't change from its current numbers. Any insight to feed my pee brain would be great! Thanks
(a) Each share of HSH Common Stock issued and outstanding immediately prior to the Effective Time (other than shares canceled pursuant to Section 2.04(b), if any), shall, by virtue of the Merger and without any action on the part of HSMG, HSH, Merger Sub or the holder thereof, be converted into and shall become fully paid and nonassessable shares of HSMG Common Stock, at an exchange rate of as required to cause the number of shares of HSMG Common Stock issued to the holders of the HSH Common Stock to be 90% of the issued and outstanding shares of HSMG Common Stock immediately following the Closing, assuming issuance of the shares of HSMG Common Stock to be issued pursuant to Section 2.07, which 90% of the issued and outstanding shares of HSMG Common Stock is currently expected to result in an exchange ratio of 127.33306 shares of HSMG Common Stock per share of HSH Common Stock (as ultimately so determined, the “ Exchange Ratio ” ), with any fractional shares of HSMG Common Stock being rounded to the nearest whole share of HSMG Common Stock. The Exchange Ratio shall be finally determined by the Parties prior to the Closing.
(b) Each share of HSH Common Stock issued and outstanding immediately prior to the Effective Time that is owned by HSMG or Merger Sub and each share of HSH Common Stock that is owned by HSH as treasury stock shall be canceled and retired and cease to exist, and no payment or distribution shall be made with respect thereto;
(c) All shares of HSH Common Stock converted pursuant to this Section 2.04, shall no longer be outstanding and shall automatically be canceled and retired and cease to exist, and each holder of a certificate ( “ Certificate ” ) representing any such shares of HSH Common Stock shall cease to have any rights with respect thereto, except the right to receive the Merger Consideration in accordance with the terms herein.
SECTION 2.05 HSMG Common Stock. At the Effective Time, any outstanding shares of HSMG Common Stock that are owned by HSMG, Merger Sub or any other direct or indirect wholly owned Subsidiary thereof shall be cancelled and retired and shall cease to exist and no cash or other consideration shall be delivered or deliverable in exchange therefor.
SECTION 2.06 Merger Sub Stock.
(a) At the Effective Time, all outstanding shares of common stock, par value $0.0001 per share, of Merger Sub issued and outstanding immediately prior to the Effective Time shall be converted into and become, collectively, one validly issued, fully paid and nonassessable share of common stock, no par value per share, of the Surviving Corporation and shall constitute the only outstanding share of capital stock of the Surviving Corporation.
SECTION 2.07 Issuances on Behalf of Receiver . The Parties acknowledge and agree that Robert Stevens has acted as the Court Appointed Receiver for HSMG and its predecessor and affiliated entities prior to the Effective Date and will act in such capacity in connection with this Agreement and the Contemplated Transactions. Immediately prior to the Closing, as HSMG has been directed by Mr. Stevens, HSMG shall issue to a total number of shares of HSMG Common Stock equal to 90% of the issued and outstanding shares of HSMG Common Stock immediately prior to the Closing, which shall therefore constitute 9% of the issued and outstanding shares of HSMG Common Stock immediately following the Closing, which is currently expected to be a total of 114,599,754 shares of HSMG Common Stock, as consideration for such services, to the following entities in the following amounts (subject to adjustment in the event that an different total number of shares of HSMG Common Stock are issued and outstanding immediately prior to the Closing): (i) 38,199,918 shares of HSMG Common Stock to Thistle Investments LLC; (ii) 38,199,918 shares of HSMG Common Stock to Take Flight Equities, Inc. and (iii) 38,199,918 shares of HSMG Common Stock to Next New Deal, LLC.
AI
