Bebida Beverage Company (BBDA)

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NOTICE: BBDA headed for 1000:1 REVERSE SPLIT

This post contains information and documents filed by the BBDA officers to execute a 1000:1 reverse split of common shares.

What is a reverse split: Info from Investopedia.com
A reverse stock split is a corporate action in which a company reduces the number of shares it has outstanding by a set multiple. This is the opposite of a stock split, in which a company increases its outstanding shares by a set multiple.

For example, if a company announces a reverse stock split of 1:100, this means that once the split occurs, investors will receive one share for every 100 shares they own. In other words, if the company has 100 million shares before the split, this number would be reduced to 1 million after the split. As in a regular stock split, a reverse split causes no actual change in the value of the company because the share price also changes. However, some investors can be cashed out of their positions if they hold a small number of shares. For example, if an investor holds 50 shares of a company that splits 1:100, that person would be left with only half a share, so the company would simply pay that investor the value of the 50 shares.

Reverse stock splits are often seen as negative corporate actions because they are a tactic used by companies that have seen their share prices fall into the $1 range and, therefore, run the risk of being delisted from stock exchanges that have minimum share price rules. For example, if a company is listed on the Nasdaq and its shares fall below $1, it runs the risk of being delisted; companies sometimes reverse split to increase share price, allowing them to continue to trade on a reputable stock exchange.

PROS & CONS
The way I see it, 2 things can happen.

PRO: If management has a solid forward plan and good intentions, the stock price has a chance go up. Since the shares outstanding have been dramatically trimmed (1000:1 for BBDA), there will be a lot more liquidity and fluctuations in the shareprice. This entices various types of short term traders who are more interested in chart potential instead of long term company growth. So, if you are not comfortable with the company's management, a potential volume spike might be enough to help you "unload" your investment at a higher price if you initially bought at .0001

CON: If management does not have good intentions or a solid forward plan, then the share price can plummet much further since it's no longer stuck at .0001 floor. For instance, if the stock price goes to 10 cents after the reverse split, then there's a good chance that it will go down and further if management decides to further dilute in order to raise cash. Unfortunately, this is also a common tactic performed regularly in the land of Pink Sheets.










The picture below shows how the amendment effected the WY SOS page for the Bebida Beverage Company. The common shares authorized were previously 14,500,000,000