I did some reading last night related to my post y
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Posted On: 01/19/2018 10:22:18 AM
I did some reading last night related to my post yesterday, I'm not great at understanding the shuffling of shares but I will put it here as information so others can see it too:
[Sorry in advance for the long post skip to the interesting part if you don't care about the background]
BACKGROUND
For those that aren't familiar, prior to being MMEX resources, we were MMEX Mining. The company focus back in 2010'ish was coal mining interests in Columbia. Maple had bought properties and mining leases in Montana and Columbia. Specifically Carpenter Creek, Slider Ranch, and Armadillo Mining. In Jacks fashion, he had created holding companies to separate the assets, and these were all housed under the LLC of Maple Carpenter Creek Holdings or MCCH.
Maple Carpenter Creek Holdings, Inc. (“MCCH”) (Main Parent)
Maple Carpenter Creek, LLC ("MCC”) (sub/parent)
Carpenter Creek, LLC (“CC”) (sub)
Armadillo Holdings Group Corp. (“AHGC”) (sub/parent)
Armadillo Mining Corp. (“AMC”) (sub)
Long story short, Hanks came in and bought MMEX (at that time Management Energy Inc) which was a wreck fraught with crooked consultants and collapsed partnerships. He merged MCCH into it and then sold all of his and the previous managements US coal projects and leases and went for a 50% stake in a coal comapny called Hunza Coal Ltd. in Boyaca, Colombia.
The Hunza Agreement required that several million dollars (about $7mil) be delivered to Hunza in a specified timeframe. As a return they would take 50% interest in an operating/licensed mining project. MMEX then went into a bunch private placements and raised about 5 million. They also had some individual accredited investors who made investments of over a million.
They meet the requirements of the Hunza deal and took a 50% stake in Feb 2012. They started their studies etc... and then in Jan 2013 the Governor of Boyacá petitioned to have Hunza's environmental permits rescinded. They fought it but in May 2013 the Permits were rescinded.
So MMEX was basically sunk and project was dead. They now had tons of debt on a non-producing project and they went silent from 2013 till mid 2016.
INTERESTING
Background out of the way here is the interesting bit:
The main accredited investor was William D. Gross who recieved 1mil preferred shares for a $1mil investment. He also previously lent $250k in a note that was payable in preferred stock. He got a majority interest in Armadillo Mining also to secure the obligation.
When Hunza went belly up, he got screwed, and MMEX had to repay. In order to clear the debt, the following happened:
On October 7, 2014, Mr. William D. Gross, the holder of the MMEX Preferred Shares and certain MMEX notes (the "Instruments" ), entered into an assignment agreement to assign the Instruments to Maple Project Finance, LLC ("MPF" ) and in turn, on October 9, 2014, MPF assigned the Instruments to Maple Structure Holdings, LLC ("MSH" ). On May 15, 2015 MSH notified the Company that it would convert the Instruments into common shares at a conversion rate of US$0.01 per share, or otherwise foreclose on the Instruments. The Company has agreed with MSH to covert the outstanding Instruments of US$3,182,877 and the 3 rd Party debt of US$500,000 under a settlement agreement dated as of May 18, 2015 at the rate of US$0.01 per share. On May 18, 2015 the MMEX Board of Director approved these transactions.
On October 7, 2015, The Company transferred 1,000,000 Preferred Shares from William D. Gross to Maple Structure Holdings, LLC.
On November 10, 2015, the Company converted 100,000,000 common shares at $0.01 per share for 1,000,000 Preferred Shares acquired by Maple Structure Holdings, LLC and voided the issued Preferred Shares.
On November 10, 2015, the Company issued 23,283,700 new common shares to Maple Structure Holdings, LLC at $0.01 per share subject to the Company Board of Directors Resolutions issued May 18, 2015.
On November 10, 2015, the Company converted and transferred the Maple Structure Holdings, LLC shares. As of February 25,2016 the Company has 180,432,013 shares issued with 19,567,987 authorized but unissued.
On November 11, 2015, Maple Structure Holdings, LLC transferred a total 70,890,440 shares to the following entities: (i) AAM Investments, LLC- 27,546,375 shares (ii) The Maple Gas Corporation- 28,091,350 shares (iii) Delavega Trading LTD- 15,252,715. All of the foregoing entities are related parties to the Directors of the Company.
This is also described in a rather confusing timeline as well:
On May 18, 2015, Maple Structure Holdings converted the 1,000,000 Preferred Shares with a book value of $1,000,000 and accrued dividends of $410,685 into 123,283,700 common shares of the Company at $0.01 per share, which resulted in a loss on extinguishment of debt of $438,571. The unamortized discount on the Preferred Shares of $375,600 was charged to interest expense. The issuance of the common shares to Maple Structure Holdings was approved by the Company’s Board of Directors Resolution dated May 18, 2015.
So whats it mean? Well as I read it, the shares held by Maple Structure and Maple Gas are all the result of the paying off of Dr. Gross preferred shares and note. It looks like they did some contortions to convert that debt into shares of MMEX. The reason I conclude is so that they could clear the books and one day recoup the money they had to eat when they bought back his shares when MMEX was successful.
This doesn't explain everything though because if he is cashing out to recoup the money now, why was it at $0. also if he wanted to recoup, they could have sold these at any time in the last year when the share price was much higher.
Anyway, that is the story behind the shares origins. Another interesting point is this: That means that Maple Structure and Maple gas were the controlling interests of MMEX in 2016. Hanks held roughly $85.5 mil shares.
[Sorry in advance for the long post skip to the interesting part if you don't care about the background]
BACKGROUND
For those that aren't familiar, prior to being MMEX resources, we were MMEX Mining. The company focus back in 2010'ish was coal mining interests in Columbia. Maple had bought properties and mining leases in Montana and Columbia. Specifically Carpenter Creek, Slider Ranch, and Armadillo Mining. In Jacks fashion, he had created holding companies to separate the assets, and these were all housed under the LLC of Maple Carpenter Creek Holdings or MCCH.
Maple Carpenter Creek Holdings, Inc. (“MCCH”) (Main Parent)
Maple Carpenter Creek, LLC ("MCC”) (sub/parent)
Carpenter Creek, LLC (“CC”) (sub)
Armadillo Holdings Group Corp. (“AHGC”) (sub/parent)
Armadillo Mining Corp. (“AMC”) (sub)
Long story short, Hanks came in and bought MMEX (at that time Management Energy Inc) which was a wreck fraught with crooked consultants and collapsed partnerships. He merged MCCH into it and then sold all of his and the previous managements US coal projects and leases and went for a 50% stake in a coal comapny called Hunza Coal Ltd. in Boyaca, Colombia.
The Hunza Agreement required that several million dollars (about $7mil) be delivered to Hunza in a specified timeframe. As a return they would take 50% interest in an operating/licensed mining project. MMEX then went into a bunch private placements and raised about 5 million. They also had some individual accredited investors who made investments of over a million.
They meet the requirements of the Hunza deal and took a 50% stake in Feb 2012. They started their studies etc... and then in Jan 2013 the Governor of Boyacá petitioned to have Hunza's environmental permits rescinded. They fought it but in May 2013 the Permits were rescinded.
So MMEX was basically sunk and project was dead. They now had tons of debt on a non-producing project and they went silent from 2013 till mid 2016.
INTERESTING
Background out of the way here is the interesting bit:
The main accredited investor was William D. Gross who recieved 1mil preferred shares for a $1mil investment. He also previously lent $250k in a note that was payable in preferred stock. He got a majority interest in Armadillo Mining also to secure the obligation.
When Hunza went belly up, he got screwed, and MMEX had to repay. In order to clear the debt, the following happened:
On October 7, 2014, Mr. William D. Gross, the holder of the MMEX Preferred Shares and certain MMEX notes (the "Instruments" ), entered into an assignment agreement to assign the Instruments to Maple Project Finance, LLC ("MPF" ) and in turn, on October 9, 2014, MPF assigned the Instruments to Maple Structure Holdings, LLC ("MSH" ). On May 15, 2015 MSH notified the Company that it would convert the Instruments into common shares at a conversion rate of US$0.01 per share, or otherwise foreclose on the Instruments. The Company has agreed with MSH to covert the outstanding Instruments of US$3,182,877 and the 3 rd Party debt of US$500,000 under a settlement agreement dated as of May 18, 2015 at the rate of US$0.01 per share. On May 18, 2015 the MMEX Board of Director approved these transactions.
On October 7, 2015, The Company transferred 1,000,000 Preferred Shares from William D. Gross to Maple Structure Holdings, LLC.
On November 10, 2015, the Company converted 100,000,000 common shares at $0.01 per share for 1,000,000 Preferred Shares acquired by Maple Structure Holdings, LLC and voided the issued Preferred Shares.
On November 10, 2015, the Company issued 23,283,700 new common shares to Maple Structure Holdings, LLC at $0.01 per share subject to the Company Board of Directors Resolutions issued May 18, 2015.
On November 10, 2015, the Company converted and transferred the Maple Structure Holdings, LLC shares. As of February 25,2016 the Company has 180,432,013 shares issued with 19,567,987 authorized but unissued.
On November 11, 2015, Maple Structure Holdings, LLC transferred a total 70,890,440 shares to the following entities: (i) AAM Investments, LLC- 27,546,375 shares (ii) The Maple Gas Corporation- 28,091,350 shares (iii) Delavega Trading LTD- 15,252,715. All of the foregoing entities are related parties to the Directors of the Company.
This is also described in a rather confusing timeline as well:
On May 18, 2015, Maple Structure Holdings converted the 1,000,000 Preferred Shares with a book value of $1,000,000 and accrued dividends of $410,685 into 123,283,700 common shares of the Company at $0.01 per share, which resulted in a loss on extinguishment of debt of $438,571. The unamortized discount on the Preferred Shares of $375,600 was charged to interest expense. The issuance of the common shares to Maple Structure Holdings was approved by the Company’s Board of Directors Resolution dated May 18, 2015.
So whats it mean? Well as I read it, the shares held by Maple Structure and Maple Gas are all the result of the paying off of Dr. Gross preferred shares and note. It looks like they did some contortions to convert that debt into shares of MMEX. The reason I conclude is so that they could clear the books and one day recoup the money they had to eat when they bought back his shares when MMEX was successful.
This doesn't explain everything though because if he is cashing out to recoup the money now, why was it at $0. also if he wanted to recoup, they could have sold these at any time in the last year when the share price was much higher.
Anyway, that is the story behind the shares origins. Another interesting point is this: That means that Maple Structure and Maple gas were the controlling interests of MMEX in 2016. Hanks held roughly $85.5 mil shares.
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