JJ;
Took this from DSKT's DEF 14-c:
Purpose and Effect of Reverse Stock Split
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Our board of directors believes the twenty for one (20:1) reverse stock split
is necessary to increase the effective marketability of its common stock to
institutional buyers and to enhance the liquidity of the common stock so that
the Company can better access capital markets. The Board of Directors believes
that if the reverse stock split has the effect of increasing the trading price
of the Company's Common Stock, the investment community may find our common
stock to be more attractive, which could promote greater liquidity for our
existing stockholders.
If the reverse stock split successfully increases the per share price of our
Common Stock, the Board of Directors further believes such increase may
facilitate future financings by the Company, and enhance the Company's ability
to attract and retain employees and other service providers. In addition, the
resulting reduction in the number of issued and outstanding shares of Common
Stock will provide the Company with additional authorized but unissued shares
which could be utilized for future product acquisitions or to otherwise raise
funds to help build the Company's business objectives. The Company has no pre-
arrangement to issue shares at this time.
Duska will not issue any certificates representing fractional shares of Duska's
common stock in the transaction, while retaining the current par value of
$0.001, with appropriate adjustments to the capital accounts of Duska. Any
resulting fractional shares shall be rounded up. Any shareholder who owns 2,000
or fewer common shares will receive one hundred shares. This reverse stock
split will reduce the number of issued and outstanding common shares from
48,751,510 to 2,437,575 common shares and have no effect on the authorized
number of shares.
The board of directors of Duska may authorize, without further shareholder
approval, the issuance of such shares of common stock or preferred stock to
such persons, for such consideration, and upon such terms as the board of
directors determines. Such issuance could result in a significant dilution
of the voting rights and the stockholders' equity, of then existing
shareholders.
Issuance of additional common stock may have the effect of deterring or
thwarting persons seeking to take control of Duska through a tender offer,
proxy fight or otherwise or to bring about removal of incumbent management or
a corporate transaction such as merger. For example, the issuance of common
stock or preferred stock could be used to deter or prevent such a change of
control through dilution of stock ownership of persons seeking to take
control or by rendering a transaction proposed by such persons more
difficult.
Stockholders will be required to exchange their stock certificates for new
certificates representing the shares of Common Stock after giving effect to
the Reverse Stock Split with the Company's transfer agent. Stockholders will
not be required to pay a transfer or other fee in connection with the
exchange of certificates.
