Management strongly believes that settling the debt to Golden Gate through the escrow, rather than to allow for massive dilution through the issuance of these shares without conversion limitations, is to the benefit of shareholders and will ultimately reduce the number of shares involved in the transaction.
Javelin and GGI have a long history together. FCCN needs GGI to pay all of the costs of going through this merger process. I dont think its a big leap of faith to say that GGI will get special treatment. And that special treatment could come partially in the way of signing of on removing 144 restrictions. IMO
I may be reading it wrong, but to me it sounds that even if FCCN signs off the sell of shares held in escrow, that GGI would have to purchase $10,000.00 dollars worth of FCCN common stock at $1.00 per share=10,000 shares. IMO. Now that i have re read the filings, guy42 i believe you are correct in your assestment about the only shares with the 144 are the C\D's. Hope i didn't confuse anybody. All of this cut and paste job came from the last three filings of FCCN.
Only stockholders of record at the close of business on February 21, 2007 are entitled to vote at the Meeting. The Company's common stock is its only class of voting securities. As of February 15, 2007, the Company has 921,183,413 shares of common stock issued and outstanding. Of this amount 747,807,988 shares are held in an escrow account for the benefit of Golden Gate Investors, Inc. and are voted by the Franchise Capital Corporation Chairman of the Board of Directors. As of the Record Date, there were 5 billion shares of Common Stock authorized with a stated value of $.0001 per share, of which approximately 921,183,413 are issued and outstanding, with 4,078,816,587 shares authorized but not issued. Of the 921,183,413 shares issued and outstanding 747,807,988 shares are held in an escrow account for the benefit of Golden Gate Investors, Inc. These shares were issued as settlement on convertible debentures and as part of a stock purchase agreement. While held in escrow these shares are voted by the Franchise Capital Corporation Chairman of the Board of Directors. Each holder of the Company’s Common Stock is entitled to one vote for each share held of record on all matters submitted to the vote of stockholders, including the election of directors. All voting is non-cumulative, which means that the holder of fifty percent (50%) plus one share of the shares voting for the election of the directors can elect all the directors. The holders of Common Stock are entitled to receive pro rata dividends, when and as declared by the Board of Directors in its discretion, out of funds legally available therefore, but only if all dividends on the Preferred Stock have been paid in accordance with the terms of such Preferred Stock and there exists no deficiency in any sinking fund for the Preferred Stock. Percentages based on 921,183,413 shares of common stock issued and outstanding as of February 15, 2007. 2) Shares issued to Golden Gate Investors are held in an escrow account. The escrow agreement provides that any shares held in escrow are voted by the Franchise Capital Corporation Chairman of the Board of Directors. Since Golden Gate Investors has neither the right to vote the shares nor the right to dispose of them, Golden Gate Investors does not meet the definition of beneficial ownership of the escrow shares. Were Golden Gate Investors to be considered the beneficial owner, Golden Gate Investors would control 843,818,400 shares, which is approximately 92% of the Company’s issued and outstanding common stock. In November 2006, the Company agreed to settle litigation with Golden Gate Investors on a past-due convertible debenture having a principle balance due of $220,927. Under the terms of the settlement, the Company placed 843,818,400 shares of its restricted common stock into an escrow account for satisfaction of the debenture. Golden Gate is allowed to withdraw the shares from escrow provided that their overall holdings in the Company do not exceed 4.99% of all issued and outstanding common stock. The debenture obligation is reduced by 80% of the average of the five lowest closing bid prices of the Company’s common stock over a 45-day period prior to the share withdrawal multiplied by the number of shares being withdrawn. Under the terms of this settlement, 96,010,412 shares have been released from escrow and the debenture balance has been reduced to $199,541.
In connection with the debenture settlement with Golden Gate, Golden Gate entered into a Stock Purchase Agreement which required Golden Gate to purchase $100,000 of the Company’s restricted common stock at a price of $1.00 per share for every $10,000 in debenture redeemed through the escrow. Under the terms of the Stock Purchase Agreement there are no time constraints on withdrawing shares from escrow, however, Golden Gate may not own more than 4.99% of issued and outstanding shares at any given time. As of January 31, 2007, the Company had sold 186,376 shares of restricted common stock to Golden Gate for $186,376 under the agreement. In addition, the Company received $800,000 from Golden Gate as an advance on future stock purchases under the aforementioned Stock Purchase Agreement. This advance will be treated as a Stock Payable in the Company’s financial statements.
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