NU Online News Service, Dec. 3, 2003, 11:12 a.m. EST – Summit Life Corp., Oklahoma City, Okla., says its board and a majority of its stockholders have approved a 1-for-100 reverse stock split that will lead to the company “going private.”[@@]
The deal affects 2.7 million shares of stock with a total market value of $532,568.40, according to a report Summit Life has filed with the U.S. Securities and Exchange Commission.
Summit Life shares have been selling for a price of about 21 cents per share on the Nasdaq OTC Bulletin Board.
In a 1-for-100 reverse stock split, the issuing company replaces every 100 shares of old, “pre-split” stock with 1 share of new stock.
The plan approved by the Summit Life board calls for the company to pay 50 cents per pre-split share to stockholders who otherwise would receive fractional shares of the new stock.
Because Summit Life will use cash, rather than stock, to compensate investors who would otherwise receive less than 1 whole share, the transaction will reduce the number of stockholders to 308, from 1,397, Summit Life says.
Federal securities laws let companies with fewer than 500 stockholders cancel their registrations and return to operating as private companies.