In two recent posts, I provided the background to the Countless Galaxies (CGI) stockholders meeting that happened Saturday in Second Life. This post will provide my thoughts about the meeting itself.

CGI stockholders gathered at the invitation of PatrickJ Ah to discussion what could be done about the situation. PatrickJ did a good job of keeping people on task. There were many people there who were more interested in lynching Jasper than they were in finding a solution to the how to save CGI. Others were investors in Atlas Venture Capital (AVC) as well as a third firm involved in the scandal.

Various people have been discussing possible forms of legal action against Frank Corsi, (aka Jasper Tizzy), but such action can take a long time and the results are uncertain. It will be interesting to watch how they develop.

The two people that seemed to have the clearest sense of how to proceed, not only in terms of CGI but also in terms of AVC and trading in virtual worlds in general were Monkey Canning and Mike31 Dawes. Monkey runs Monkey Corporation International. They are a Second Life Real Estate firm (which uses Drupal as its website).

PatrickJ started off by explaining the current situation of CGI. The details are sketchy because my computer kept crashing during the meeting. The gist of it, however, is that CGI didn’t have funds to pay their tier, and PatrickJ chipped in to cover it to the tune of around U.S.$ 600. CGI does not have sufficient rental to cover expenses and something needs to be done.

PatrickJ presented two different options for CGI. The first was to liquidate. By various estimations, if the assets of CGI were sold off at current market values, this would work out to around L$ .20 per share. The second option was to merge with Brautigan & Tuck Holdings. PatrickJ said that he had an offer from IntLibber Brautigan of two shares of BNT for every three shares of CGI.

BNT had been trading on the Second Life Capital Exchange (SLCapEx). Over the past month as high as L$ .90, but has been on a consistent downward slope into the teens. Much of this is driven by Nicholas Portocarrero, the second largest shareholder, selling off stock. Nicholas was head of the failed Ginko Financial.

BNT started to rally recently, as there was talk about them moving to another stock exchange, perhaps one set up and run by IntLibber Brautigan. This resulted in trading of BNT being halted on SLCapEx. If BNT is valued at L$ .20 and there is a three for two deal, that means that CGI stockholders receive about L$.13 per share, assuming they will have a place to trade BNT stock and they can get out without further depressing BNT shares.

During the meeting, Mike31 suggested a restructuring involving a secondary offering of CGI stock to raise funds to cover tier expenses. Another option would be to sell off a sufficient amount of unrented land to cover tier expenses and to get the firm stable again.

There were some people that wanted to vote right then and there on the proposal. They seemed to be the people intent on selling the land.

Another suggest was to shop this around a little to see if a better deal could be found than the BNT deal, or if a restructuring plan could be refined.

Since then, there have been numerous discussions about how to proceed. If you have ideas, please feel free to add them as comments here or contact me via email or in Second Life.

PatrickJ has scheduled another CGI shareholders meeting for the 28th at 5 PM Second Life Time to further discuss the options, with a shareholders vote being tentatively scheduled for Monday.