MARIETTA, Ga., July 5, 2012 /PRNewswire/ -- VIASPACE Inc. (OTC Bulletin Board: VSPC - News), and its subsidiary VIASPACE Green Energy Inc. (OTC Bulletin Board: VGREF) today provides the following update to shareholders.
As reported in the joint VIASPACE (VSPC) and VIASPACE Green Energy (VGE) Press Releases dated April 30, 2012 and again on June 11, 2012, the boards of both companies at the joint board meeting held on April 19, 2012, unanimously approved a baseline 2012 budget that utilized the profits from the framed art business division (Inter-Pacific Arts Corp. -- IPA) and the future revenues from the sale of pellets from the China Plantation to fund the VIASPACE Giant King™ Grass business. In addition, at the same joint board meeting on April 19, 2012, one year employment contracts for the CEO and CFO were approved. The 2012 budget had all expenses paid in cash with the goal of no additional stock dilution for shareholders. Attending that joint board meeting, and documented in the minutes, were VGE Directors, Sung Chang, Samuel Chen and Carl Kukkonen; and VIASPACE Directors Sung Chang, Carl Kukkonen, Angelina Galiteva and Kevin Schewe. The two boards present at that meeting voted unanimously for these board actions and these votes and actions were recorded in the corporate minutes.
Following the joint board meeting on April 19, 2012 in Denver, Colorado, Mr. Chang traveled to China and Taiwan. When he returned to the U.S., he informed the VIASPACE board that he no longer intended to have Inter-Pacific Arts or VGE provide financial support to VIASPACE for the Giant King Grass business, and that VGE should retain the IPA profits from the sale of framed art and the future profits from the pellet mill in China. Chang also requested a proposal for the separation of VIASPACE and VIASPACE Green Energy into two companies. This surprise change of corporate direction occurred less than a month after Mr. Chang's vote of support on April 19, 2012 as a Board Director for both VIASPACE and VGE. Mr. Chang subsequently resigned from the VIASPACE Board on May 24, 2012.
VIASPACE agreed to embark on a series of negotiations with Mr. Chang to separate VIASPACE and VGE which were carefully documented in our June 11, 2012 Press Release, and at the time of that Press Release, we believed we were at an impasse. Within two days of the June 11, 2012 Press Release, negotiations to separate the companies had resumed and those negotiations have continued since then. Mr. Chang has not declared in writing that VIASPACE is in default on the existing note due to him. Carl Kukkonen and Stephen Muzi have not resigned or been terminated and both continue to work as CEO and CFO, respectively, for both VIASPACE and VGE. Their prior employment contracts with VGE expired on May 14, 2012, and new contracts were extended for one year by vote of the VGE Board of Directors on April 19, 2012. Neither Dr. Kukkonen nor Mr. Muzi have been paid since May 2012. The VIASPACE Green Energy Board has not had a formal board meeting since April 19, 2012. The VIASPACE Board of Directors has been meeting regularly to review and return proposed term sheets from Mr. Chang's lawyer.
VIASPACE CEO, Carl Kukkonen, continues to work with potential customers and clients of VIASPACE who are interested in Giant King Grass and we continue to believe that VIASPACE can become one of the first successful renewable biomass/bioenergy companies using our significant corporate knowledge and expertise and having Giant King Grass as our scalable bioenergy platform. The VIASPACE Board has given Mr. Chang a potential way forward which addresses his desire not to fund the company any longer through IPA framed art sales or future China pellet sales and simultaneously gives him and all VSPC shareholders a reasonable chance of increasing shareholder value.
The VIASPACE Board returned the last set of term sheets to Mr. Chang and his lawyer on Tuesday, July 3, 2012, with a deadline for them to respond back to us by Friday, July 6, 2012. We have proposed that the term sheets be agreed upon and signed by both parties no later than Tuesday, July 17, 2012 and formal legal documents memorializing the term sheets signed within 45 days thereafter. The VIASPACE Board and management believe that it is in the best interests of the VIASPACE shareholders that these negotiations should be concluded soon. VIASPACE CEO Dr. Carl Kukkonen stated, "This remains a period of uncertainty for VIASPACE and we are working hard to arrive at a resolution that benefits all VIASPACE shareholders. We will continue to make all efforts to keep our shareholders properly and accurately informed."
About VIASPACE Inc.
VIASPACE is a clean energy company providing products and technology for renewable and alternative energy that reduce or eliminate dependence on fossil and high-pollutant energy sources. The Company grows Giant King Grass as a low-carbon fuel for electricity generating power plants, as a feedstock for bio methane production and cellulosic biofuels, and for other low-carbon, renewable energy products. For more information, please go to www.VIASPACE.com or contact Dr. Jan Vandersande, Director of Communications, at 800-517-8050 or IR@VIASPACE.com.
Safe Harbor Statement
Information in this news release includes forward-looking statements. These forward-looking statements relate to future events or future performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Such factors include, without limitation, risks outlined in our periodic filings with the U.S. Securities and Exchange Commission, including Annual Report on Form 10-K for the year ended December 31, 2011, as well as general economic and business conditions; the ability to acquire and develop specific products and technologies; changes in consumer and business demand for the Company's products; competition from larger companies; changes in demand for alternative and clean energy; risks associated with international transactions; risks related to technological change; and other factors over which VIASPACE has little or no control.
SOURCE VIASPACE Inc.