Last Thursday, Power of the Dream Ventures, Inc. (OTC:PWRV
, PWRV message board
) filed a PRE 14C form concerning some corporate actions taken by the company and announced in a press release yesterday. There was a strong market response.
Initially, it seemed traders were happy with the announcement. PWRV went as high as $0.345, but then in a matter of minutes the price dropped, and finally PWRV closed down 25.25% at $0.151 on 1.6 million shares.
The company reduced the authorized shares from 250 million to 50 million without reducing the number of issued and outstanding shares. PWRV also increased the par value of its common stock to $0.001 and created a class of Series B Preferred stock.
Mr. Rozsnyay, CEO and President of PWRV, said the Series B Preferred stock are created to serve a near term fund raising goal. The shares aren't convertible, but each Series B share will be deemed the equivalent of 2 common shares when calculating the participation in all cash distributions or stock dividends.
PWRV is yet to start generating revenue, and it seems until that time the company will require additional funding. While the reduction of the authorized shares suggests the company isn't planning to dilute its common stock a lot, the market response shows some people aren't too thrilled about the current developments.