January 5, 2005 in Business

Met plans to sell stake in GenPrime

By The Spokesman-Review
 
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Background and the latest updates

Metropolitan Mortgage & Securities plans to sell its stake in GenPrime Inc. for $451,780 in cash to help settle its bankruptcy case.

The sale is essentially a stock buyback for GenPrime, which will pay Metropolitan a fraction of the stock’s original purchase price.

GenPrime, a small Spokane company with about 15 employees, makes quick-response kits that help determine if items contain dangerous toxins or microbes such as anthrax, ricin and the botulism bacteria. Police and emergency teams can use the kits to help handle security threats. They have been touted as anti-terrorism equipment.

Metropolitan was the first investor in GenPrime and still holds a nearly 30 percent ownership interest in the company, said GenPrime CEO Johnny Humphreys.

According to bankruptcy court records, Metropolitan intends to sell its 2.25 million shares of GenPrime preferred stock along with a warrant to buy another 15,000 shares.

Metropolitan affiliate Jaguar Ventures handled the company’s venture capital investments. It bought the shares from September 2000 to December 2003, paying between 83 and 92 cents per share.

Today, the stock is worth between 15 cents and 20 cents per share, according to court records. GenPrime will buy back the stock and then intends to find a new investor, Humphreys said.

The proposed sale, however, depends upon GenPrime’s ability to issue a new series of preferred stock that would raise at least as much money as the company paid to redeem the Metropolitan shares.

Metropolitan is selling land, buildings, investments, loans and other assets as it liquidates and attempts to pay something back to more than 16,000 creditors – mostly elderly investors living in the Northwest.

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