The ‘written consent’ is the vote.
Since Thompson has a majority of votes, he can provide the vote thru his written consent, just as he can authorize the specific ratio as the only member of the board.
The news that he will alter the voting power of his two super voting shares is good news. The fact that his reverse split is not limited to a 40-to-1 ratio is not.
I fear we may see a slightly higher reverse split, perhaps a 50-to-1 split. (Note to my many fans: when I say ‘I fear...’ that does not mean it will happen. Only that the probability is substantially above zero but also perhaps substantially below 100% as well.)
The reason for this is to increase the value of the fixed-price warrants. To make this easy to understand, I will pretend our share price is at 14 cents when the reverse split happens and that Thompson uses a 100-to-1 ratio. The new share price would be $14. Investors who buy shares at that price thru this offering get a warrant to buy another share at $5.50. They exercise this warrant and immediately sell both shares for $14 each and clear $8.50 in profit.
Still in the pretend mode. If Thompson sets the r/s ratio to 10-to-1, the share price is $1.40. Warrants to purchase shares at $5.50 are worthless. Investors might as well have purchased shares on the open market.
This example proves my point: Thompson is motivated to get the share price to a high level to increase the chances of a successful offering. He can do this by upping the ratio on the reverse split. Hence my fear.
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