Conclusions -

So it seems that what is intended by the pro-forma insolvency and issuance of a change-in-control put is an amalgamation. The issue of the asset transfer, which has been kept off the books for years may finally be resolved through amalgamation with a special purpose amalgamating corporation.

What the SBCA might be referring to In series 'A' preference share paying $0.08 is really 8 cents on the dollar. For example, if series 'A' shares were issued at par value of $100, then the yearly distribution would be $8-.($8/30 is 27 cents per share without consolidation, so entirely doable. There would be room to pay a dividend to common shareholders of perhaps $0.13 a share, or $1.30 post 10:1 common issuance). The company would have to consider ALL of this in order to compete. The ownership in the company post amalgamation I imagine would be 10m. series 'A' and 30m. common shares.

There is also the issue of control. Very highly likely through the Offering Memorandum control of the company will remain in the same hands, as only the insiders involved would see it first hand.

-F6