RACOM SYSTEMS, INC.
P.O. Box 3224
Boulder, Colorado 80307
July 1, 1999
Dear Stockholders of Racom Systems, Inc.:
You are invited to attend a Special Meeting of the Stockholders of Racom
Systems, Inc. (the "Company") to be held at the Law Offices of Gary A. Agron,
5445 DTC Parkway, Suite 520, Englewood, Colorado 80111, the Company's counsel,
at 9:30 A.M. local time, July 12, 1999, or at any adjournment or postponement
thereof (the "Special Meeting").
At the Special Meeting, you will be asked to consider and vote upon an
amendment to the Company's Certificate of Incorporation to effect a reverse
stock split of the Company's common stock, par value $0.01 (the "Common Stock")
on the basis of one share for each fifteen shares outstanding (the "Reverse
Split") in order to reduce the number of outstanding shares of Common Stock,
from 19,987,230 to approximately 1,332,482 and to consider and vote upon any and
all other business that may properly come before the Special Meeting. Details
relating to this matter including potential reasons for the Reverse Split are
set forth in the attached Proxy Statement. Please review and consider the
enclosed materials carefully. All stockholders of record of the Company as of
the close of business on June 17, 1999 will be entitled to notice of and to vote
at the Special Meeting or at any adjournment or postponement thereof.
YOUR BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE REVERSE SPLIT. THE
BOARD OF DIRECTORS OF THE COMPANY BELIEVES THAT THE PROPOSED REVERSE SPLIT IS IN
THE BEST INTERESTS OF THE COMPANY AND ITS STOCKHOLDERS AND UNANIMOUSLY
RECOMMENDS THAT YOU VOTE FOR ITS APPROVAL.
Regardless of the number of shares you hold or whether you plan to attend
the Special Meeting, we urge you to complete, sign, date and return the enclosed
proxy card immediately. If you attend the Special Meeting, you may vote in
person if you wish, even if you have previously returned your proxy card.
Sincerely,
Arthur B. Rancis
President
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