COURT ORDER MAY REQUIRE CPT HOLDINGS TO ISSUE ADDITIONAL SHARES
COURT ORDER MAY REQUIRE CPT HOLDINGS TO ISSUE ADDITIONAL SHARES WASHINGTON, Oct. 5 /PRNewswire/ -- CPT Holdings, Inc. today announced that it may be required to issue up to approximately 15 percent of its currently issued and outstanding shares in order to satisfy a recently issued order of the United States Bankruptcy Court for the District of Minnesota. The order awarded a former chief executive officer of the company shares of Class B Common Stock of the company, the shares held by the pre-petition shareholders of the company. Since the date of the court's order, the Class A and Class B shares have been combined into a single class of "common stock."
The company had reserved certain of its shares to satisfy creditor claims. The claim of the former chief executive officer was for damages, and it was believed that any damage award would be from the shares reserved for creditors.
Under the bankruptcy plan approved by the Bankruptcy Court, the former shareholders, on the one hand, and the creditors and a new investor, on the other hand, were to own 80 percent and 20 percent, respectively, of the total shares of the company. Because of the order, which has the effect of increasing the number of shares held by the company's former shareholders (as opposed to its creditors), it may be necessary to award additional shares of common stock not only to the former officer, but also to the former creditors of the company and the new investor, to maintain the intended 80/20 balance. Last Thursday (Oct. 1), the company moved to have the Bankruptcy Court amend its order to award damages instead of Class B Shares. If the motion is granted, the damage claim would be satisfied by the transfer to the former officer of outstanding shares of common stock currently held in escrow to satisfy claims of the company's creditors. Should this happen, the company will not have to issue any additional shares of stock. A hearing on this matter is scheduled for Oct. 21, 1992. The company does not know when the court will rule on this matter. -0- 10/5/92 /CONTACT: Joe Kycek of CPT, 612-949-1819/ CO: CPT Holdings, Inc. ST: Washington, D.C. IN: CPT SU:
AL -- MN009 -- 6533 10/05/92 11:28 EDT
|Printer friendly Cite/link Email Feedback|
|Date:||Oct 5, 1992|
|Previous Article:||IBM AND KNOWLEDGEWARE INC. EXPAND AD/CYCLE ALLIANCE|
|Next Article:||ALCO FORMS JOINT VENTURE IN EUROPE|