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Microcap & Penny Stocks : UNIVERSAL EXPRESS INC - USXP -- Ignore unavailable to you. Want to Upgrade?

To: jmt who wrote (459)	6/30/1998 9:22:00 PM
From: TraderGreg	Read Replies (2) \| Respond to of 2493

There is no rule. BNEZ did a 1 for 12 recently, didn't change the authorized; CVIA announced a 1 for 300 (since put on hold due to an awesome shareholder revolt) and when they announced the reverse they graciously lowered the authorized to 1/3 the previous level. There is no requirement to reduce the authorized following a reverse. Period, end of discussion. Look people, the whole point of these kinds of reverses (where the fundamentals are lacking the criteria for NASDAQ listing) is to give the company "head" room to print more shares. It is a hell of a lot easier to sell 1 share at initially 70 times pre-split prices than it is to sell 70 shares. If it wasn't easier they wouldn't do it. And when the authorized is barely higher than the outstanding shares, they can't get much more shares printed out, without voting to increase the authorized. That vote requires notifying the shareholders(unless the board has the votes in hand). My God, that would be like disclosure, The reverse, on the otherhand, can be voted on by the Board and unless the shareholders demand a proxy vote, it becomes a fait accompli. After the reverse, a company can start oozing shares out. Given the current 50 million authorized(unless RA similarly does a gracious reduction) will permit future dilution to the equivalent of 3.5 billion shares pre-split. Will it happen? With absolute certitude, they will print paper. A reverse done under these circumstances is a license to steal. A final word. To those of you who are still ticked off at Lakers, ask yourselves how you would feel if the number of shares that you owned two years ago have now been reduced to 1/840 of their original number.(Remember, he's seen a 1 for 12 and a 1 for 70). That's right, 840 shares from a couple of years ago are now 1 share!! As someone who has been thru back to back 1 for 40s(1 for 1600 after the dust settles), I know why he may come across sounding real bitter. TG