Perhaps this (more recent) e-mail from SCKT CFO may answer more questions: (very interesting!)
ragingbull.com
Just to allay some fears I e mailed Dave Dunlap with a summary of investor concerns and
his reply confirms everything that my sources tell me if you are able to read between the
lines.
Everything is moving forward well at Socket as outlined in our management
conference call on April 26th (transcript and audio are available on
Vcall.com under our trading symbol SCKT). The Nasdaq delays are a case of
lots of pending listing applications being handled by an overworked Nasdaq
staff. They reviewed our application for completeness in February, provided
us with a list of additional information they needed once they ascertained
our category which we provided in March, and collected analyst reports from
third parties in April so that they would be ready to commence the final
stage which is a due diligence stage where they confirm the information in
our application, read all of our materials, and talk to many of those that
work with the Company including accountants, analysts and market makers. I
talked with the examiner earlier this week who confirmed that they are still
working on applications ahead of ours and that we are firmly "near the top
of the queue". We believe we qualify for the National Market Exchange and
expect the review to complete quickly once the final phase is started.
In our proxy materials to Socket's stockholders (filed on Edgar) we are
requesting stockholder approval to increase the authorized number of common
shares from 50 million to 100 million, and you may be comparing our fully
diluted share number of 25 million to the newly requested authorized total.
The reasons for the requested authority are addressed in the proxy:
"The Company believes it is important to retain a significant reserve of
authorized but unissued Common Stock that could be used to raise additional
capital through the sale of securities, declare stock dividends or stock
splits, acquire another company or its business or assets, create
negotiating leverage and flexibility in the event of an unfriendly takeover
bid or establish a strategic relationship with a corporate partner, among
other uses. In particular, the Company believes that maintaining a
sufficient reserve of authorized but unissued Common Stock is important to
preserving the Company's flexibility to enter into future financing
opportunities. The Company expects to seek to raise additional capital
through equity financing, joint ventures with corporate partners or through
other sources."
It is traditional for U.S. companies that the Board of Directors have
flexibility to deal with challenges or with the opportunities that affect a
growing company as addressed above, and having a sufficient reserve of
authorized but unissued capital is part of that tradition. The Board has
always been sensitive to dilution in decisions regarding equity and their
focus is on maximizing shareholder wealth. You will also note in the Proxy
two new directors to be approved at Socket's stockholder meeting in June,
Leon Malmed and Enzo Torresi, who bring a great deal of experience to the
Board.
Best regards,
Dave Dunlap, CFO |
