1. Is it important that free trading shares from non affiliates be included as part of the shell purchase?

When you are considering the purchase of a shell it is important to assess what your needs are. In many cases your needs will determine the price of your shell. If you are seeking a shell with high delivery (99%) inclusive of free trading shares you will be paying from $750,000 to $900,000 for the shell.

So what is the importance of the free trading shares? In today’s SEC environment there are many hurdles to jump through, especially when it comes to raising funds from a PIPE transaction. Sometimes trying to get shares registered is a difficult process. If potential non affiliate investors have an opportunity to also purchase free trading shares from current non affiliate shareholders then your chances of success with raising capital are greatly enhanced.

So the real question becomes: “Is it worth paying an additional $300,000 for a high delivery shell with free trading shares?” If you are raising a substantial amount of funds, then I would give a resounding “YES” answer. Think of it this way: If you were an investor and had a choice between (i) investing in a company that had to register your shares sometime in the future or (ii) receiving free trading shares now as part of your investment, which deal would you invest in? Time is money. If free trading shares are available to investors as part of their investment they know for certain that they have instant liquidity.

If you have to hire an outside broker dealer or consultant to raise your funds you are going to pay at least a ten percent (10%) fee for the raising of the capital. Raising capital is not easy and it takes a substantial amount of time from start to finish. Now, if you are adept at raising capital and you have free trading shares to offer investors, then you will speed up the process or raising capital and saved yourself a substantial amount of commissions and/or fees.

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