Mcglen Founders Agree to Help Firm Raise Cash

The Mcglen Internet Group Inc., a Tustin electronic commerce company, said Monday its founders have agreed to provide up to 10 million shares of their stock, or about half of their holdings, to help the company raise funds.

The stock from founders Alex Chen, Mike Chen and George Lee will be used to create a financing pool for such purposes as capital creation, mergers or acquisitions, business development, management incentives and growth-related activities.

Under the agreement, the founders are entitled to receive a fee of 5% of the cash raised by the company in using the shares in the pool.

The founders made the shares, about 32% of all shares outstanding, available for 18 months. Shares not used at the end of that period will be retained by the founders.

Mcglen provides specialty technology, components and memory products through online marketplaces. The stock, which traded as high as $15 a share late last year, closed Monday at $1.19 a share, up 13 cents, in Nasdaq trading.