About a week ago, the Nevada-registered JMG Exploration, Inc. reported the termination of the share exchange with BVI-registered Newco Group Ltd., which was contemplated by the Share Exchange Agreement with ESAPI Ltd., a company organized under the laws of the Commonwealth of the Bahamas. Now, JMG Exploration updates status of defaulted loan to the BVI company.
The oil and gas corporation JMG Exploration reported on the acquisition of the BVI holding company Newco Group in August 2006, and the transaction was expected to be closed until December 31, 2007. Previously, JMG announced that Newco had failed to repay a $3 million loan and accrued interest that was due December 31, 2007, and that the loan was in default. A previous offer to allow Newco until March 31, 2008 to repay the $3 million loan was not accepted.
Now, Nevada corporation announces about its intention to exercise its remedies as a secured creditor, - including transferring the shares of Indian company Iris Computers Ltd. that secure the loan into the name of JMG.
In case the BVI company does not repay the loan and JMG transfers the pledged Iris shares in JMG's name, JMG will have effective majority control of Iris because of the 39% equity interst in the company represented by the pledged Iris shares, and JMG's irrevocable proxy from ESAPI representing an additional 14.5% equity interest in Iris. Then, JMG's Board of Directors will either sell the investment, or retain and perhaps even increase it.
