Coy thanks for posting that info from the Snake. Anytime someone meets with management in person its quite valuable to share that information with the board. Let me just say one thing about the reverse split, especially to Microprose -DON'T DO IT! I say take the small cap listing if it comes down to that. This is not the BB. Why? I have first hand experience with 3 companies that reversed over the years. Two have been relegated to BB status, one (THQ) has become a monster of a stock. I would not compare MPRS mgt. to THQ's mgt. Farrel has my vote for video game exceutive of the year. The stock has gone from 5.75 to 32 7/8. Here is some more detailed information about why MPRS should not undergo a reverse split. I urge all MPRS shareholders to write Steve Race and urge him not to do it. Enclose a copy of the below listed article:
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Subject: Re: Reverse Split
Date: Fri, Feb 27, 1998 13:03 EST
From: Bonzo3
Message-id:
>>Can somebody enlighten me as to what is so inherently negative about a reverse split except that it is usually a sign of a company that has failed miserably? <<
8. Watch out for reverse splits!
Here's how a reverse stock split works. A company's stock currently
trades at $1. The company implements a one-for-five reverse split. Every
five shares of pre-split stock becomes one share. The investor, who had
previously held 1,000 shares, now owns 200 shares of the post-split
stock. The new stock price immediately after the split is $5. The market
value of the position, before and after the split, is $1,000. What could
be wrong about that?
Because when such a reverse split takes place, it's often a glaring
indication that all is not well at the company. True, the shareholder
does not suffer a loss of asset value or a dilution of ownership value.
But this equality is usually very temporary.
When a company undertakes a standard stock split, things are usually
going well. The business operations are profitable and growing, and the
shares are moving steadily upward. Such is almost never the case for the
company implementing a reverse split.
Pure and simple, reverse splits are facilitated to improve the
appearance of the company and its stock price. The company whose stock
is $5 appears more valuable than one whose stock is merely $1. But if
the company really believed in its future and wanted to reduce its
amount of outstanding shares, it would start to buy them from the
market.
Furthermore, the stock is now ripe for a secondary offering of more
shares by the company. For the pre-split shareholder, his percentage
ownership in the company will endure a magnified degree of dilution the
moment the new shares hit the market. The company's objective for the
share offering has yielded the desired capital, but the risk has been
transferred to the shareholders. It makes no monetary difference to the
company.
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