Aisystems, Inc. (fka ASYI)

[S-BEES-BUMBLEBEE]

Bazinga~~

Bingo! Think I have found evidence of how ASYI/KoolTel RM has circumnavigated IRS' Section 382 limitation on NOLs!!!! Remember how ASYI divested it's Airline Systems software prior to the acquisition/merger (see bold section below)??!!

Also the 3rd paragraph is interesting!

Quote: Section 382 requires that the buyer meet the continuity of business enterprise requirement; continuing use of the target's historic business or a significant portion of the target's assets in an existing business for 2 years following the transaction. If the continuity of business requirement is not met, the annual NOL limitation is zero. The continuity of business requirement, together with the annual NOL usage limitation, effectively discourage acquisitions of loss companies for their NOLs alone.

The Section 382 limitation may be circumvented if the target and buyer collaborate to sell unwanted target assets with unrealized built-in gains before the acquisition occurs. The target may then use its NOLs to offset the gain on the sale without limitation. If the unwanted asset disposal occurred after the transaction, on the other hand, the NOLs would be subject to limitation under Section 382 would not go as far in shielding the gain.

Companies with unused NOLs seeking new equity financing should be careful not to issue so much new equity as to trigger a change in ownership under Section 382. For example, an IPO of a biotech company that accumulated substantial NOLs during its start-up phase might trigger a qualifying change in ownership. Companies seeking to raise substantial equity financing should consider issuing straight preferred stock (no voting or conversion rights or participation in future earnings) rather than common stock.

http://macabacus.com/taxes/attributes

Go ASYI/KoolTel~~



ASYI~ WIN/WIN-SITUATION IMHO~~
ASYI/KoolTel's WINNING-SONG!!!