PowerLinx Inc (PWNX)

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Here's how Rich is SELLING his shares:

DISCLAIMER:

The following analysis is based on the Form 10-Q for June 2000 and the Proxy statement filed earlier this year. It is my opinion based on the facts of the filings, and my interpretation of what is written therein.


The Q says the following:

Item 5. Other Information

Affiliated Transactions

On August 23, 2000, the Board of Directors approved the issuance of 471,425 shares of restricted Company common stock in the form of a loan to an individual then serving as an officer of the Company. Pursuant to the terms of the loan, the officer would borrow 471,425 shares of restricted Company common stock, for purposes of financing. The term of the loan was 180 days.

So let's look at this. Rich is borrowing 471,425 shares of stock for financing. Note that Rich is the borrower in this transaction.

The filing further states:

To consummate this loan transaction, on September 20, 2000 the Company issued 471,425 restricted shares of Company common stock to a non-affiliated individual. On April 10, 2001, the borrower repaid the loan by returning to the Company 471,425 restricted shares in SeaView common stock from his personal holdings. The Company cancelled those shares on that date.

Here's the crux of the deal. The company doesn't give the shares to Rich, they give them to a non-affiliated individual. For argument sake, I'll call that individual John Doe. So John Doe now has 471,425 shares of SEVU stock that he can't sell for a year. Well, he's not going to do this for nothing, so he tells Rich, I'll give you $0.25 per share and hope the price goes up in the next year. (note that $0.25 is strictly for argument sake only). Rich takes the $117,856.25 (471,425 shares times $0.25) and pockets the money. Now he has to repay the loan, and simply gives the company back some shares he previously had acquired. That is what you call a sale. Indirect, yes, but a sale nontheless. You have to note that the company said the borrower repaid the loan, NOT the non-affiliated individual. All interest free of course.

The Q further states:

At an October 2, 2000 special meeting of the Board of Directors, the Board approved the issuance of 25,000 shares of restricted Company common stock in the form of a loan to an individual then serving as an officer of the Company. Pursuant to the terms of the loan, the officer would borrow 25,000 restricted shares of Company common stock, for purposes of financing. The term of the loan
was 180 days.

To consummate this loan transaction, on October 3, 2000 the Company issued 25,000 restricted shares of Company common stock to a non-affiliated individual. On April 10, 2001, the borrower repaid the loan by returning to the Company 25,000 restricted shares of SeaView common stock from his personal holdings. The Company cancelled those shares.

This transaction is the same as the one above. Note that the completion of these deals came at the same time the note was repaid to the company ($235,000). Looks like this may have been how it was done.

Also note that the Proxy was trying to be cute, and that this deal was done after the date of the proxy so to not tip anyone off as to the fact that Rich is selling shares. He's not buying, he's selling people.
http://ragingbull.lycos.com/mboard/boards.cgi?board=SEVU&read=41203