Stereotaxis
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PRE 14A
STEREOTAXIS, INC. filed this Form PRE 14A on 03/28/2019
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PROPOSAL 4: APPROVAL OF AMENDMENT TO THE COMPANY’S CERTIFICATE OF INCORPORATION TO AUTHORIZE A REVERSE STOCK SPLIT OF THE COMPANY’S COMMON STOCK

 

The Company’s Board of Directors has adopted a resolution approving and recommending to the Company’s shareholders for their approval a proposal to amend our certificate of incorporation to authorize a reverse split of our outstanding shares of common stock within a range of one share of common stock for every two shares of common stock to one share of common stock for every ten shares of common stock, with the exact reverse split ratio to be decided and publicly announced by the Board of Directors prior to the effective time of the reverse stock split amendment. If the shareholders approve this Proposal No. 4, the Board of Directors will have the authority to decide, at any time prior to 12 months after the date of the Annual Meeting, whether to implement the reverse stock split and the precise ratio of the reverse stock split within a range of one-for-two shares of our common stock to one-for-ten shares of our common stock. If the Board of Directors decides to implement the reverse stock split, the reverse stock split will become effective upon the filing of an amendment to our certificate of incorporation with the Secretary of State of the State of Delaware (“Reverse Split Amendment”).

 

The Board of Directors reserves the right, even after shareholder approval, to abandon or postpone the filing of the Reverse Split Amendment if the Board of Directors determines that it is not in the best interest of the Company and the shareholders. If the reverse stock split proposal is approved by the shareholders but is not implemented by the Board of Directors within 12 months from the Annual Meeting, the proposal will be deemed abandoned, without any further effect. In that case, the Board of Directors may again seek shareholder approval at a future date for a reverse stock split if it deems a reverse stock split to be advisable at that time

 

The form of the Reverse Split Amendment to accomplish the reverse stock split is attached to this Proxy Statement as Appendix B. The following discussion is qualified in its entirety by the full text of the Reverse Split Amendment, which is incorporated herein by reference.

 

Reasons for the Reverse Stock Split

 

The Board’s primary reasons for approving and recommending the reverse stock split are that the Board believes that:

 

  the reverse stock split is the most effective means of increasing the per-share market price of our common stock in order to become eligible for listing on a national exchange; and
     
  a higher per-share market price of our common stock could encourage investor interest in our Company and promote greater liquidity for our shareholders.

 

Our common stock is currently listed on the OTCQX® under the symbol “STXS”. We believe that becoming listed on a national exchange will support and maintain the liquidity of our common stock for our shareholders. In order for our common stock to be eligible for listing on a national exchange, we must satisfy the initial listing requirements, which could include, among other requirements, a minimum closing price of at least $3.00 per share for our common stock.

 

An objective of the Board in proposing the reverse stock split is to increase the per-share market price of our common stock in order to become eligible for listing on a national exchange. Effecting the reverse stock split would reduce our total shares of common stock outstanding, which the Board believes will increase the price per share of our common stock and therefore, better enable us to list our common stock on a national exchange. However, the effect of the reverse stock split on the market value of our common stock cannot be predicted with any certainty, and there can be no assurances the market price per post-split share will either exceed or remain in excess of the minimum closing price for a sustained period of time. The reverse stock split itself does not affect our market value, and the market price of our common stock may also be based on other factors that are unrelated to the number of shares outstanding, including our future performance.

 

The Board of Directors believes that shareholder approval of an amendment that would allow the Board to determine the exact reverse stock split ratio within a specified range of one-for-two to one-for-ten (rather than shareholder approval of a fixed reverse stock split ratio) provides the flexibility to achieve the desired results of the reverse stock split. The Board of Directors will consider the conditions, information and circumstances existing at the time when it determines whether to implement a reverse stock split and, if it decides to implement a reverse stock split, the precise reverse stock split ratio.

 

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