McRae Industries Announces Stockholder Approval of Reverse/Forward Stock Split to Permit SEC Deregistration
November 17 2005 - 5:22PM
PR Newswire (US)
MOUNT GILEAD, N.C., Nov. 17 /PRNewswire-FirstCall/ -- McRae
Industries, Inc. (Amex: MRI.A; MRI.B) announced today that at a
special meeting held on November 17, 2005 its stockholders approved
a 1-for-200 reverse stock split, to be followed immediately by a
200-for-1 forward stock split, of the outstanding shares of both
classes of its common stock (Class A and Class B) (the
"transaction") for the purpose of permitting the company to
deregister the common stock under the Securities Exchange Act of
1934 (the "Exchange Act"). The stockholder approval authorizes the
Board of Directors to implement the transaction at any time before
December 31, 2005, subject to the right of the Board of Directors
to defer or abandon (and not implement) the transaction if it
determines that the transaction is not in the best interests of the
Company and its stockholders. As discussed in the proxy statement
for the special meeting, in preparation for the anticipated
implementation of the transaction the Company established a process
through the Depository Trust Company whereby beneficial owners who
held fewer than 200 shares of a particular class of common stock in
"street name" were able to submit their shares so that they could
be cashed out in the transaction. Through this process a
significantly greater number of shares were submitted than was
anticipated. As a result, the estimated number of shares that would
be cashed out in the transaction has increased from 56,140 to
approximately 192,000 and the estimated cost to purchase these
shares, after estimated transaction expense of $190,000, has
increased from $800,000 to approximately $2.7 million. Given this
significant increase in the estimated number of shares that would
be purchased in the transaction, the Board of Directors is
considering whether implementation of the transaction would still
be in the best interests of the Company and its stockholders. The
Board of Directors may choose to implement the transaction at any
time prior to December 31, 2005 or may determine to abandon (and
not implement) the transaction. This release includes
"forward-looking" information statements, as defined in the Private
Securities Litigation Reform Act of 1995, including the estimated
cost to implement the transaction. Actual results may differ from
those provided in the forward-looking statements. The cost to
purchase shares in the transaction may be different than the amount
currently estimated based on changes in the distribution of share
ownership through the effective date of the transaction. McRae
Industries, Inc., a Delaware corporation headquartered in Mt.
Gilead, North Carolina, is engaged in the manufacture, sale and
distribution of military footwear and western and work boots, and
the sale and distribution of bar code reading and printing devices.
DATASOURCE: McRae Industries, Inc. CONTACT: D. Gary McRae of McRae
Industries, Inc., +1-910-439-6147 Web site:
http://www.mcraeindustries.com/
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