FORT LAUDERDALE, Fla., Aug. 28, 2002 (PRIMEZONE) -- Carcorp USA Inc. ("CUSA") (OTCBB:CUSA) announced that a special committee of the board of directors has been formed to review the merger document and associated consulting agreements that resulted in Carcorp USA entering the public marketplace. The goal of the Special Committee, headed by Claude Kirk, former governor of Florida, is to determine if significant breaches have occurred and to take the proper corrective action, if warranted.
Based on the Special Committee findings, the Company is pursuing the appropriate actions, which may include:
Cancellation of all or a portion of the free trading shares retained by the shareholders of the shell company into which Carcorp was merged, and of the advisors that advised Carcorp on the merger.
An exchange of restricted securities for free trading shares for the founding shareholders.
A suit for damages for breach of contract.
The Special Committee is reviewing all consulting contracts entered into with third parties to determine if there was a failure of consideration. Based on the Special Committee's initial findings, approximately 600,000 shares have been cancelled. These shares were issued to consultants as compensation for merger-related services. The consultants who received these 600,000 shares failed to perform.
Furthermore the Company has placed a hold on approximately 1,300,000 free trading shares that were associated with the reverse merger while the Board engages in further due diligence on whether there were material breaches of the merger agreement and the representations and warranties stated therein. All shareholders affected by the Company's actions will be notified today by the Company in writing.
Mr. DeMeo stated: "Carcorp USA is committed to the public marketplace, and will continue to take any and all actions to assure the stock of the Company reflects the underlying value of the Company, and results in maximum value for our shareholders. Part of our fiduciary duty to our shareholders is to assure that the services for which we contract are actually rendered, and that these services create value for the Company. The Board of Directors' action affects a limited number of shareholders of our overall shareholder's base."
Forward-Looking Statements
Statements about the Company's future expectations, including future revenues and earnings, and all other statements in this press release other than historical facts are "forward-looking statements" within the meaning of section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as the term is defined in the Private Litigation Reform Act of 1995. The company's actual results could differ materially from expected results. The Company undertakes no obligation to update forward-looking statements to reflect subsequently occurring events or circumstances. Should events occur which materially affect any comments made within this press release, the Company will appropriately inform the public.
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