I can't believe that people wake up to work on things like that...
Hmmm... Does anyone know if this wording is trying to justify giving malone the preferred shares w/o a shareholder vote? If so, I thought the consensus would be that it was because of pending doom not because he is "an accredited investor".
Item 3.02 Unregistered Sales of Equity Securities
Pursuant to the previously announced Investment Agreement, dated February 17, 2009, among us and the Purchaser (the “Investment Agreement”), we issued 1,000,000 shares of Series B-1 Preferred Stock and 11,500,000 shares of Series B-2 Preferred Stock in consideration for the investments described therein. The preferred stock was offered to the Purchaser in an offering exempt from the Securities Act registration requirements under Section 4(2) of the Securities Act of 1933, based on the Purchaser’s representation that, among other things, it is an “accredited investor” within the meaning of Rule 501 under the Securities Act.
well obviously they found some kinda loophole :O
Hi, being an accredited investor means he holds the credentials to trade shares with SEC. (insider stuff) If they had found someone SEC did not know (some guy with 500 million ) they would have more paper work to fill out before they could exchange his 500 mill for 40 percent of common.
I think Delaware actually requires non accredited investors to file 2 years in advance before they can acquire more then 5 percent shares in a company.
(I leave it to the more motivated to post the actual legal gibberish)