The way I read it...the shares that are being used are still restricted and to me it looks like the resale or transfer of the restricted shares of Common Stock held by Messrs. Kerr and Shaffer is not permissible because both affiliates have entered into a "lock-up" agreement. Am I reading this wrong or what? can they divest themselves of their ownership in the company?
As of December 31, 2003, there were 5,300,000 shares of common stock that are considered restricted securities under Rule 144 of the Securities Act of 1933. All 5,300,000 shares are held by Jamie Kerr and John Shaffer, both of whom are our affiliates, as that term is defined in Rule 144(a)(1). At the present time, the resale or transfer of the restricted shares of Common Stock held by Messrs. Kerr and Shaffer is not permissible because both affiliates have entered into a "lock-up" agreement, whereby their holdings may not be sold until the earlier of the following events:
1. A period of three years from, December 1, 2003, the effective date of the offering conducted under Rule 504 of Regulation D (which date shall be December 1, 2006),
2. When our stock is traded on the OTCBBr at an average share price of greater than $0.025 per share for a minimum of three months,
3. Our shares are listed on the Nasdaq SmallCap MarketSM or higher market or
4. We have paid the purchasing shareholders in the Regulation D offering their investment in the form of cash dividends.
As these events have not yet occurred, Messrs. Kerr and Shaffer may not divest themselves of their ownership in our company, neither through public or private means.
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