Einstein Bros 2006 Annual Report Download - page 19

http://www.sec.gov/Archives/edgar/data/949373/000104746907001622/a2176540z10-k.htm[9/11/2014 10:12:36 AM]
trademarks and proprietary rights by us. In addition, others may assert rights in our trademarks, service marks and other proprietary rights.
Risk Factors Relating to Our Common Stock
We have a majority stockholder.
Greenlight Capital, L.L.C. and its affiliates beneficially own approximately 94 percent of our common stock. As a result, Greenlight has
sufficient voting power, without the vote of any other stockholders, to determine what matters will be submitted for approval by our stockholders,
to approve actions by written consent without the approval of any other stockholders, to elect all of our board of directors, and to determine whether
a change in control of our company occurs. Greenlight's interests on matters submitted to stockholders may be different from those of other
stockholders. Greenlight is not involved in our day-to-day operations, but Greenlight has voted its shares to elect our current board of directors.
The chairman of our board of directors is a current employee of Greenlight.
Our common stock is not currently listed on any stock exchange. As a result, we are not subject to corporate governance rules adopted by the
New York Stock Exchange (NYSE), American Stock Exchange (AMEX) and Nasdaq requiring a majority of directors to be independent and
requiring compensation and
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nominating committees that are composed solely of independent directors. However, we are subject to rules requiring that the audit committee
consist entirely of independent directors. Under the rules of these stock exchanges, if a single stockholder holds more that 50% of the voting power
of a listed company, that company is considered a controlled company, and except for the rules relating to independence of the audit committee, is
exempt from the above-mentioned independence rules. Since Greenlight beneficially owns approximately 94 percent of our common stock, we
may take advantage of the controlled company exemption if our common stock becomes listed on an exchange in the future. As a result, our
stockholders currently do not have, and may never have, the protections that these rules are intended to provide.
Future sales of shares of our common stock by our stockholders could cause our stock price to fall.
If a substantial number of shares of our common stock are sold in the public market, the market price of our common stock could fall. The
perception among investors that these sales will occur could also produce this effect. Our majority stockholder Greenlight beneficially owns
approximately 94 percent of our common stock and sales by Greenlight or a perception that Greenlight will sell could cause a decrease in the
market price of our common stock.
Holders may find it difficult to effect transactions in our common stock.
Our common stock is currently trading on the "pink sheets" under the symbol "NWRG.PK." Since our common stock is not listed on Nasdaq,
AMEX or the NYSE, holders of our common stock may find that the liquidity of our common stock is limited—not only in the number of
securities that can be bought and sold, but also through delays in the timing of transactions, lack of security analysts' and the news media's
coverage of us, and lower prices for our securities than might otherwise be attained.
Securities that are not listed on a stock exchange, the Nasdaq Global Market or the Nasdaq Capital Market are subject to an SEC rule that
imposes special requirements on broker-dealers who sell those securities to persons other than their established customers and accredited investors.
The broker-dealer must determine that the security is suitable for the purchaser and must obtain the purchaser's written consent prior to the sale.
These requirements may make it more difficult for stockholders to sell our stock than the stock of some other companies. It may also affect our
ability to raise more capital if and when necessary.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None
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ITEM 2. PROPERTIES