Originally Posted by bohogirl
OK Phil, I'll help out a bit here, since I stayed up half the night last night rereading the 10k and the original and amended 8k from July.
10k says 'The mentioned preferred stock was held by Former CEO Michael Alexander and was nullified upon the execution of the Merger Agreement dated July 8, 2006 with CSHD and filed with the Security Exchange Commission is incorporated herein by this reference to 8-K/A [html][text] 500 KB [Amend] Current report, item 2.01 Acc-no: 0001297077-06-000068 (34 Act).'
All right.
Lets go over to the 8-K/A, which was signed and notarized and filed on July 11, 2006.
First thing we see in regards to the issue is the often quoted Article II, point 2.2, Company Shares, which clearly states:
(a) Each share of the Company's capital stock (the "Company Shares"), par value $0.001 per share, issued and outstanding immediately prior to the Effective Time shall, by virtue of the Merger and without any action on the part of the holders thereof, be canceled and converted at the Effective Time into the right to receive the Merger Consideration (as defined below) in accordance with this ARTICLE II.
(b) Each Company Share, by virtue of the Merger and without any action on the part of the holder thereof, shall at the Effective Time no longer be outstanding, shall be canceled and retired and shall cease to exist, and each holder of certificates representing any such Company Shares shall thereafter cease to have any rights with respect to such shares, except for the right to receive the Merger Consideration.
(c) Notwithstanding anything contained in this Section 2.2 to the contrary, any Company Shares held in the treasury of the Company immediately prior to the Effective Time shall be canceled without any conversion thereof, and no payment shall be made with respect thereto.
(d) From and after the Effective Time of the Merger, there shall be no transfers on the stock transfer books of the Surviving Holding Company of Company Shares that were outstanding immediately prior to the Effective Time. If, after the Effective Time, certificates representing Company Shares are presented to the Surviving Holding Company, they shall be canceled, and exchanged for the Merger Consideration as provided for herein.
Now, lets dig a little deeper here.
What if we were to scroll all the way down to EXHIBIT A - FORM OF PLAN OF MERGER, and look at the point E, Conversion and Exchange of Shares?
So, the point of this long rant is, it looks like some of us got confused on which one is 'the company' and is getting shares 'canceled' and which one is 'the buyer' and has all shares remain outstanding.
Remember - it was a reverse merger - Fronthaul 'bought' CVSU. Fronthaul is the buyer, and Fronthaul's shares shall remain outstanding and shall not be affected by the Merger.
AI
