Now that I have read the Stock Acquisition Agreement I have a comment/question to make sure I am reading this correctly. The current free trading shares, approx. 5.8 mil are being acquired for $3.12/share, along with the 12.4 restricted shares for a total purchase price of $56 mil.
However, in Section 1.04 it states that upon acceptance of this agreement, Motion DNA will issue 25 mil new restricted "control stock" shares to Formula 51-2. My question is whether the 5.8 mil free shares are going to be retired? It sounds like that is what is going to happen. The 12.4 mil restricted shares are going to be replaced with "new shares". Those + the 25 mil new "control shares" would put total O/S of 37.4 mil, and the balance of the $56 mil purchase price, after subtracting the $18.2 mil for the 5.8 "free trading, 504 shares", equals about $37.7 mil. That would put the post aquisition value of the 37 mil O/S at about $1.01 per share. However, if the 5.8 free trading shares were not retired, that would put the total outstanding at close to 43.2 million and the diluted value of each share to approx. $1.29. When do we tender our "free trading - 504 shares"?...before the 25 mil new "control stock" gets added? I want to make sure my free trading shares are worth $3.12, and not $1.29 or $1.01.
Can anyone explain this is a clearer way?
Vanbookie
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