Phoenix Associates Land Syndicate (fka PBLSQ)

[Renavatio]

Thoughts on a R/S (crazy for me to bring it up)...

Someone PM'd me about what would happen to the Preferred Stock if PBLS does end up doing a R/S. Unless Nevada law says differently, I believe that these boys do hold the right to R/S any equity share that they have outstanding, whether its common, warrants, options, convertible preferred and "standard" preferred as long as the majority vote approves it. Nevada might have different provisions as state law is given precedence, but I don't find any evidence that Nevada Law is different. I believe that because the Preferred Shares that are received from exchanging common shares are voting, the majority of the holders of those preferred shares have to approve a R/S of those specific preferreds.

Now I haven't heard anything from IR or management that makes me think that a R/S is going to happen, but any and all things are possible. But here's one interesting thing I found out about R/S. If they did decide to do a R/S of common shares without a vote from us, they would have to do a R/S on the Preferred III as well because they are convertible forward to common. So in effect, a R/S of common would be doing something that is detrimental to their ownership assuming that Paul, Ron and Carolyn own the Preferred III's.

I'm no lawyer so please do correct me if I am wrong. All I did was google "preferred stock reverse split" and go from there. Just trying to tie up loose ends. Again, I think the fact that the Preferreds received from the offer that they extended on Monday have voting rights, PBLS can't just choose to R/S them with a vote by everyone. Again, if they do a R/S of the common, it in effect would produce a R/S on the Preferred III's which we all believe to be held by the Bayou boys.

Here are some examples of companies that did R/S the preferreds. Pay close attention to the link from Occam. Their Series A-2 Preferreds seem to be similar to PBLS' Preferred III's...

http://www.law.uc.edu/CCL/InvCoRls/rule18f-2.html
Rule 18f-2 -- Fair and Equitable Treatment for Holders of Each Class or Series of Stock of Series Investment Companies

http://www.occamnetworks.com/news_and_press/press_releases/pr134.cfm
“As of February 17, 2006, Occam had shares of common stock issued and outstanding. Including 356,265,536 shares of common stock to be issued upon conversion of outstanding series A-2 preferred stock and warrants, the company had a total of 631,667,076 shares of common stock outstanding on an as-converted basis. Post reverse split, the company will have approximately 6,885,039 common shares issued and outstanding and a total of 15,791,677 shares outstanding on an as-converted basis. As a result of the reverse split, the conversion ratio of our Series A-2 preferred stock will be proportionately adjusted which will decrease the number of shares of common stock issuable upon conversion of each share of Series A-2 preferred stock from approximately 90.9 shares of common stock to approximately 2.27 shares of common stock.”

http://investor.poniard.com/faq.cfm?faqid=2&mode=test
“Following the reverse stock split, which became effective at 5:00 p.m. Pacific Time on Friday September 22, 2006, every six shares of Poniard issued and outstanding common stock automatically were combined into one share of common stock. There is no change in the par value of such shares. The reverse stock split results in similar adjustments to Poniard's outstanding stock options, warrants and convertible preferred stock.”

http://www.marketwatch.com/news/story/milacrons-1-for-10-reverse-stock-split/story.aspx?guid=%7BCF61....
“Milacron now has approximately 5.6 million common shares as well as 6,000 shares of 4% preferred stock outstanding. Including its 6% convertible preferred stock on an "as converted" basis, the company now has approximately 11.3 million fully diluted common shares. Common stockholders otherwise entitled to fractional shares are receiving a cash payment in lieu thereof, while fractional shares of the 4% preferred stock are being issued to qualified holders.”