I know this is not a normal topic of interest for the community, but I do have a situation that needs help. I'm sure there's a way to do this.

I have client with OTC stock, has been in litigation for almost a year. The company refuses to lift restrictions and yet violates rule 144. The stocks have been held past restriction window. After many months the company has agreed that they may "cooperate" as long as the stockholder doesn't dump into marketplace and acquire a loan where the shares are not sold for a period of time.

Most companies offering non-recourse loans usually "trade" these therefore selling in the marketplace, right?

Is there anyone or group that would loan and hold the free trading shares for an extended time without dumping? Therefore the company doesn't have to worry about overextending the float and potentially taking a dump on the value? Don't need a high LTV.

Thank you.

Frank

you have given no details, so I will stay very general:

a. in the current market environment a straight loan will be difficult
b. depending on the value etc maybe a debt placement on the basis of the shares may be possible, again details are missing, minimum amount should be 11 M $ US, evaluation of shares and LTV really conservative
c. sell the shares with restrictions in a private deal
d. look for a broker who allows you to use the securities for a trading line and invest the lie for a profit income
e. give them hell and junk the shares into the market (needs legal expenses)
f. put the shares into another company and sell its shares to the owner of the first share company

I suspect not all of the above is workable, Richard is buying private shares at a discount and does investment deal involving OTC when the details are right; seems for the liquid people there are a lot of good deals out there, so drop him a line (since I'm not allowed to reference another forum here you may find him ........

Frank,

Try John... Maybe he can help you.. I don't know for sure but the fit seems right?

john at hedgelender.com

2 Penn Center Plaza

Philadelphia, PA 19102

Telephone (727) 475-8055

Fax (954) 736-1654

John Thompson (Regional Manager)

http://www.hedgelender.com/?a_aid=0214e155

 

Our showcase stock loan securities finance program is our Premier HedgeLoanŽ, our trademarked brand we today assign to a stay-in-your-name/account Premier loan where a public stock option can be structured to protect the value of the portfolio against lender loss. These loans come with interest-only quarterly payment based on monthly LIBOR+2 (currently about 4.35%), and the freedom to pay down principal as well if desired; fast closing within 72 hours of signed loan documents; early payoff at any time without penalty; the assignment of a personal licensed institutional account advisor; no margin calls for any reason; monthly statements direct from the brokerage; and protection of the growth of the portfolio to the borrower even while it secures the loan, all in a simple lien-type arrangement where the shares are frozen in your account until the loan is repaid.

 

I hope this helps Frank.. if not let me know and I will ask around for you.

Be well, JW

 

Gentlemen,

I thank you all again for your recommendation. I don't think Hedgelender's can help, thank you JW, I've been there but the problem is that they are not the lender's, some guys out of Chicago have the monies and they have their own reasons as to why they want to pass. Not saying there's anything wrong with the deal, it's just not something they "choose" to do. Dracon, it does have an average of $11MM face value but only appx. $3MM is "free trade", the remaining is restricted for another 5 months. Principal would consider selling a cross secton or blocks. Thank you for referring to Richard. I'll reach out to him, and your other ideas are great. Thank you all again.

Warmest Regards,

Frank