JMG Exploration, Inc., has announced that it has signed a Share Exchange Agreement with the shareholders of Newco Group Limited, – a limited liability company organized under the laws of the British Virgin Islands. The information about the acquisition of the BVI company by the Nevada-incorporated JMG, was published in August 2007. The Board of Directors of JMG Exploration has given its approval to the Share Exchange Agreement, and now is recommending shareholder approval of the transaction. The company provides for the delivery to JMG of 100% of the outstanding stock of Newco, in exchange for the delivery by JMG of JMG common stock representing 62.5% of company’s capital stock. So, after the share exchange, the existing JMG shareholders will retain approximately a 37.5% equity interest in the company.
BVI-based Newco currently owns about 14.5% of shares of Iris Computers Ltd., a corporation organized under the laws of India and one of the leading distributors of IT products in India. In the closest time, JMG expects to execute documents providing for a $3,000,000 loan to the BVI company, to enable Newco to purchase39% equity interest in Indian corporation.
The closing of the Share Exchange Agreement is conditioned by the delivery of 2007 US audited financial statements, partial year review for 2008 for BVI-based Newco and Iris, and approval of the share exchange transaction by JMG shareholders. The transaction is expected to close until December 31, 2007. If the JMG share exchange with Newco shareholders fails to close, the BVI company will be obligated to repay the $3,000,000 loan to JMG on or before December 31, 2007.