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Proposed Subscription Rights Offering
6 Months Ended
Jun. 30, 2011
Proposed Subscription Rights Offering  
Proposed Subscription Rights Offering

Note 2 – Proposed Subscription Rights Offering:

In May 2011, we filed a preliminary registration statement on Form S-1 with the SEC in connection with a proposed distribution of non-transferable subscription rights to our common stockholders to purchase an aggregate of up to 3,025,483 shares of our common stock. Following the SEC declaring the registration statement effective under the Securities Act of 1933, as amended, we plan to distribute one subscription right for each share of common stock held on a record date to be determined. Each whole subscription right would entitle the record holder of common stock to purchase 0.25 shares of our common stock at a per-share subscription price to be determined by our board of directors.

We would not issue any fractional shares of common stock in the subscription rights offering, and holders would only be entitled to purchase a whole number of shares of common stock, rounded down to the nearest whole share a holder would otherwise be entitled to purchase. Subscribers who exercise their rights in full would be entitled to over-subscribe for additional shares, subject to certain limitations, to the extent shares are available.

 

Assuming the subscription rights offering is completed, we intend to use all of the net proceeds from the sale of the common stock pursuant to the subscription rights offering to declare and pay a special one-time dividend to all of the holders of our common stock on a record date to be determined shortly after completion of the subscription rights offering. See Note 5.

Contran has indicated to us that it would purchase all of the shares of common stock to which it is entitled in the subscription rights offering pursuant to its subscription rights, and subject to the availability of shares, Contran would exercise its over-subscription privilege to the fullest extent possible. Consequently, even if no stockholders other than Contran exercise their subscription rights, the subscription rights offering would nonetheless be fully subscribed.

There is no assurance that the registration statement will be declared effective, or that we would commence the subscription rights offering (as outlined above or otherwise). Also, assuming we commence the subscription rights offering, there is no assurance that it would be completed, since we intend to reserve the right to cancel or terminate the subscription rights offering at any time before the expiration of the subscription rights offering and for any reason.