This excerpt taken from the PRVT DEF 14A filed Nov 3, 2009.
RATIO OF BETWEEN 1 FOR 2 AND 1 FOR 50 AT ANY TIME PRIOR TO DECEMBER 31, 2010
Our Board of Directors is submitting for shareholder approval the discretionary authority of the Board of Directors to file an amendment to our Restated Articles of Incorporation substantially in the form attached to this Proxy Statement as Appendix A (the Amendment) to effect a reverse stock split of our outstanding common stock at a ratio of between 1 for 2 and 1 for 50, as will be selected by our Board of Directors following shareholder approval and prior to the time of filing a certificate of amendment to our Articles of Incorporation with the Nevada Secretary of State. The Amendment, if and when filed with the Secretary of State of Nevada, will effect a reverse stock split of our common stock at the ratio to be selected by our Board of Directors following shareholder approval and specified in the Amendment. Under the terms of the proposal, if the Amendment is not filed with the Nevada Secretary of State and effective by December 31, 2010, the authority of the Board of Directors to file the Amendment will expire. Under the proposed amendment the total number of authorized shares would remain at 110,000,000, 100,000,000 of which are common stock and 10,000,000 are preferred stock, which means that a reverse stock split would result in an increased number of authorized but unissued shares of our common stock. Pursuant to the law of our state of incorporation, Nevada, in order to effect a reverse split of our common stock which does not also proportionately reduce the number of authorized shares, our Board of Directors must first adopt an amendment to our Articles of Incorporation and submit the amendment to shareholders for their approval.
Our Board of Directors, in its discretion, may elect to effect any one (but not more than one) of the reverse split ratios between 1 for 2 and 1 for 50 upon receipt of shareholder approval, or none of them if our Board of Directors determines in its discretion not to proceed with the reverse stock split following shareholder approval. We believe that the availability of a range of reverse split ratios will provide the Company with the flexibility to implement the reverse stock split in a manner designed to maximize the anticipated benefits for the Company and its shareholders. In determining whether to implement the reverse stock split and which of the reverse stock split ratios to implement, if any, following the receipt of shareholder approval, our Board of Directors may consider, among other things, factors such as:
To avoid the existence of fractional shares of our common stock, fractional shares which would otherwise result from the reverse stock split will be rounded up to the nearest whole share in lieu of such fractional shares.
At the close of business on October 19, 2009, we had 62,114,803 shares of common stock issued and outstanding. The actual number of shares outstanding after giving effect to the reverse stock split will depend on the reverse split ratio that is ultimately selected by our Board of Directors. We do not expect the reverse stock split itself to have any economic effect on our shareholders or option holders or rights holders.