RM along with RS:
Based on the recent PR, it sounds like they’re trying to get out of penny stock status as well during RM. I might be wrong but they may go for a reverse split along with reverse merger. There are two reasons, one is they already have huge o/s shares and with new authorized shares to be issued to CLX, the o/s will be almost 2.5 billions, which will be ridiculous to carry on the books. On the other hand, in order to uplist the company with senior stock exchanges, the stock price cannot be in pennies (they hinted indirectly in the PR as quoted below).
This is the opportunity for them to take care of huge outstanding shares by reverse split. The recent PR indicated that CLX will be issued Convertible preferred shares. Simultaneously, they’re asking existing shareholders to convert their shares to preferred (although it is a tender offer).
My guess is that they ultimately, they will do a reverse split along with converting CLX preferred shares to common shares. Anyone else see that happening? I am pretty sure this reverse split, if happens, will not hurt us as it will be a part of RM.
QUOTE:
“The increase that has been approved by the majority of Shareholders is 1,750,000,000 and provides us flexibility to use a portion of these newly authorized shares to close the transaction with CLX, as well as with any other entity, by providing enough shares in the Treasury to issue a new series of Convertible Preferred shares envisioned to be priced at $15.00 per share.
This clearly provides the Company with a new class of security that will not be deemed a penny stock. It is believed that this will provide us access to both an entire new group of sophisticated and professional investors to finance our planned growth.”
