Well, you can’t say that InPlay Technologies has not put up a good fight. Over the past several years, InPlay has reorganized, refocused, and retooled, only to finally be met with an economic situation that is wreaking havoc on a number of companies. Sadly, today there is one less digitizer company to challenge the likes of Wacom and N-Trig, not to mention the jobs of the folks who currently work at InPlay.
Today, InPlay Technologies announced that they entered into a binding Letter of Agreement to merge with US Rental Housing. Current shareholders of InPlay will become shareholders in US Rental Housing; all assets will be sold to a third-party, all InPlay employees will be let go, and the InPlay Technologies name will be no more.
Here is the press release:
InPlay Technologies, Inc. (NASDAQ: NPLA) announced today that it has entered into a binding letter of intent to merge with U.S. Rental Housing REIT, Inc. (USRHR). The transaction is subject to final negotiation and execution of a definitive merger agreement, and InPlay stockholder approval within 120 days.
InPlay’s Board of Directors has unanimously approved and recommended that the following transactions, among others, be put forth for stockholder approval:
· Change the company name from ““InPlay Technologies, Inc.Ã¢â‚¬Â to ““U.S. Rental Housing REIT, IncÃ¢â‚¬Â;
· Increase the authorized shares from 40 million to 200 million shares;
· Issue 50 million shares of restricted stock for all of the outstanding shares of USRHR; and
· Sell at closing all current InPlay assets to a third pary in exchange for the assumption by the buyer of the liabilities of InPlay plus other consideration.
Upon execution of the letter of intent, USRHR was required to pay to InPlay the sum of $175,000 to be used for working capital and transaction expenses. In return, InPlay was required to issue to USRHR a convertible note, subject to conversion at the option of the holder into one million shares of common stock.
U.S. Rental Housing Real Estate Investment Trust is a development-stage real estate investment trust which will focus its initial efforts on rental housing in major U.S. markets.
Van Potter, President and CEO, InPlay stated, ““The ongoing financial crisis has made raising capital exceedingly difficult. We have pursued a number of options, but to date we have been unsuccessful in our efforts to secure the additional funding required for our current business to succeed and prosper. With USRHR’s strategy in the real estate market, this merger will provide an opportunity for InPlay shareholders to rebuild shareholder value now and into the future. Given the current environment, our Board feels that this transaction is in the best interests of our shareholders.Ã¢â‚¬Â
““Using USRHR’s capital position, combined with InPlay’s public reporting transparency, we believe we can acquire exceptionally well-positioned and well-conceived multi family rental properties. In addition, we plan to acquire real estate backed mortgages from various financial institutions, or out of judicial foreclosures and bankruptcies at steeply discounted prices,Ã¢â‚¬Â said David Walsh, incoming Chairman, USRHR.
“According o the Urban Land Institute, all economic indicators forecast the highest demand for rental housing in the history of the U.S. over the next five years. With this demand and the need for the housing market to lead the U.S. economy out of the recession, we believe now is the time to acquire and invest in the multi family rental properties,” Walsh continued.
Upon close of the merger, USRHR will accept the resignation of all current InPlay officers and directors. All outstanding severance agreements and stock options will be cancelled. In consideration, USRHR will provide a pool of 2.2 million restricted shares for directors and executives.
David Walsh will be Chairman of USRHR. Mr. Walsh is Chairman and Managing Director of Wardley, Walsh, Wellesley and Company, Ltd., an international investment banking firm. Since 1983, Mr. Walsh also operates Walsh Holding Company, a diversified real estate development, construction and financing organization. Prior to this time, Mr. Walsh’s experience in the investment banking industry extends over a twenty year period. After serving an apprenticeship with a subsidiary of the Continental Illinois Bank of Chicago, Mr. Walsh became Vice President and later Executive Vice President of Hospital Mortgage Corporation, a publicly held corporation specializing in health care finance. In 1975, Mr. Walsh became President of Great Northern Financial, which arranged and funded government credit enhanced financing for major projects including GNMA backed securities and tax-exempt bond issues. Mr. Walsh is a retired Commissioned Officer in the United States Naval Reserve. He received a Ph.B. degree from Northwestern University.
About U.S. Rental Housing REIT
U.S. Rental Housing REIT is focused on acquiring real estate projects, typically between $50-150 million that are currently unable to obtain financing. USRHR will then develop these projects as rental properties financed under the HUD and GNMA insurance and guarantee programs, in joint ventures with Developers. USRHR intends to minimize operational expenses over the next two years, distribute 90% of income to shareholders and apply for status as a Real Estate Investment Trust under section 856 of the Internal Revenue Code.
About InPlay Technologies
InPlay Technologies is a developer of innovative human interface devices for computing and communication products. Our mission is to help make complex products easy and intuitive to use by providing a natural method of interaction. InPlay’s integrated digital pen and touch technologies automatically recognize pen or finger input, allowing the user to choose the most effective input method. With the only digital-communication based pen input system, our products offer significant advantages over traditional analog designs. Like the evolution of cell phones from analog to digital, our roadmap enables an increasing number of useful features and functionality for computers, Smart phones and other electronic products. Visit www.inplaytechnologies.com for more information.