What are the chances we can AVOID a R/S??

So from this information, it appears Sirius fully understands the negative consequences of a reverse split and furthermore appears to be against issuing one...


A reverse stock split could have certain adverse consequences, including:
• if the reverse stock split is effected and the market price of our common stock declines, the percentage decline may be greater than would occur in the absence of a reverse stock split.
• there can be no assurance that the reverse stock split will result in any particular price for our common stock. As a result, the trading liquidity of our common stock may not necessarily improve.
• the total market capitalization of our common stock after the reverse stock split may be lower than the total market capitalization before the reverse stock split. Moreover, in the future, the market price of our common
stock following the reverse stock split may not exceed or remain higher than the market price prior to the reverse stock split.
• because the number of issued and outstanding shares of common stock would decrease as result of the reverse stock split, the number of authorized but unissued shares of common stock may increase on a relative basis. If
we issue additional shares of common stock, the ownership interest of our current stockholders would be diluted, possibly substantially.
• the proportion of unissued authorized shares to issued shares could, under certain circumstances, have an anti-takeover effect. For example, the issuance of a large block of common stock could dilute the stock ownership
of a person seeking to effect a change in the composition of the board of directors or contemplating a tender offer or other transaction for the combination of the company with another company.
• the reverse stock split may result in some stockholders owning “odd lots” of less than 100 shares of common stock. Odd lot shares may be more difficult to sell, and brokerage commissions and other costs of transactions
in odd lots are generally somewhat higher than the costs of transactions in “round lots” of even multiples of 100 shares.
• holders of common stock otherwise entitled to a fractional share as a result of the reverse stock split will receive a cash payment in lieu of such fractional share. As a result, the ownership interest in the company of certain
small stockholders could be terminated.

Hopefull, that is standard jargon that is required for any company debating or who has approved a reverse split. It was the same wording used in the prospectus in order to authorize the RS.

With todays news, I think RS is inevitable.

Way to rain on my parade Newman, lol... Thanks for your input, much appreciated! :)

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Originally Posted by Newman

Hopefull, that is standard jargon that is required for any company debating or who has approved a reverse split. It was the same wording used in the prospectus in order to authorize the RS.

With todays news, I think RS is inevitable.

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Yes. What more needs to be said. Look at the diluted float.

R/S's get a bad rap for a reason, they fail the overwhelming majority of the time. And why is nobody factoring in the economy to the R/S equation. To say Wall Street has little to no confidence in the ruling Party in DC and the White House, well, would be the understatement of the young century.

I keep hearing posters in here refer to a possible uptick in the economy towards the end of this yr. I want some of the Kool-Aid their drinking. The current Administration and Congress are taking away (almost weekly) the incentives corporations and small businesses rely on to grow their business. In the 1100 plus pages of the so-called stimulus bill, there is no money sent to any small businesses as stimulus. The bill left them out to dry. And all they do is provide 70% of all American jobs. Corporate Tax, capital gains and dividend tax is all going up. Add cap and trade to the equation, and businesses will not only NOT be hiring new employees, they will be rasing the cost of their products and services to every US consumer.

We're already at $3.7 trillion in deficit spending, and the ink is still wet on the frist stimulus bill, and DC is now talking about needing a second stimulus bill. The insanity is running rampant in Washington. But what lies beneath is the real scary part, and the early evidence shows clearly the White House and Congress is agenda driven above and beyond fixing the economy.

Place a 2 yr moratorium on Cap Gains tax, and then reduce corporate and small business taxes along with rate cuts in payroll taxes to the worker, and I'd be willing to bet the farm if that were done last Sept...this economy would already be showing huge signs of growth. But what do I know? All I've done is come out of the liberal US college sysytem with a BA in economics which leans towards the conservative side.

Things are gonna get a whole lot worse before they get better. The last thing Sirius needs to do is a R/S in these pathetic economic conditions. Most folks will see the negative montra that a R/S has attached to it throughout history, and most will think they are acting accordingly and sell. Fundamentally, a R/S may actually work if timed prior to multiple items of good news which would almost require a partnering of some sort on a grand scale be included as the main part of that good news.

Bottom line, a R/S may very well be a good thing fundamentally in the long run. Problem is, the current state of the economy, and the negative stigma attached to an R/S of any stock by the average investor. For those two reasons alone, I wouldn't touch a R/S with a ten foot pole.

Well said DoctorG,the BIG BAD Boogeymen waiting in the closet is the CDS'S
(Credit Default Swaps) of which there are 60 TRILLION worth(AIG,BUFFET)
and of course a return to double digit inflation of the late 70's..IMHO

I don't think any company wants 3.5B shares (or 6B with Malone) floating, so even though I can't guarantee it, but I guarantee there will be a R/S, and it will be the maximum allowed at 50:1. My big concern is the SP will be pounded right back down. If you think of what the R/S will do for your breakeven costs, take your current average SP (mine .71c) and multiply it by 50. The SP would need to get to $35.50 after the R/S just to break even. Just makes me sick.

I think anyone holding at .50c or higher will be screwed into oblivion. I just hope the SP makes it to .50 as I will sell all and take a loss. There is just to much outside manipulation to allow a win for the longs. Those that got in between .05 and .15 should do well as long as they sell before the R/S. Even at .15 the SP would need to go to $7.50 after the R/S and I doubt that will ever happen. The best thing from what I see is sell before the R/S, to recoup what you can, and then rebuy after the R/S and after the shorts have driven the SP back down. But once your out, there is no reason to get back in and go through this crap all over again.

Still holding 55602 @ .71 and still hoping for .50c. This is my opinion and I'm sticking to it.

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Originally Posted by Newman

They need to wait until they have a consistant string of good news. I could see an RS coming around September if the economy turns around, banks start lending, and people start buying cars. If all of these are not happening yet, a RS will be a disaster for current shareholders.

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I did mention an uptick in the economy towards the end of the year. You want to know why? This recession is media-driven. While it is true that unemployment numbers have gone up, it is no where near record highs.
Banks right now have more cash on hand than ever before in their history. Why? Because they are afraid to lend. (Similar to 9/11 - Airports had mediocre security, then 9/11, now the security borders on stupidity. Same concept.)
The average savings account in the United States has DOUBLE of what was 2 years ago. Why? Because the media is scaring the crap out of most people.
So there is more money in banks than ever before and most people have more money in savings than ever before... Have you been to a mall recently? They are PACKED. My good friend is a car salesman. He says that they are a ton of people looking for cars, but the credit markets are so tight that few can get loans. Does this sound like a true depression situation? It does not to me.

I agree that the government has blown it once again, but what else is new? The ONLY thing that needed to be done to stimulate the economy once again was to tell the banks that they needed to loan the money out given in TARP 1. They could have given them an extra 250 billion (only 25% of this last bailout) to loan out. But, they didnt. Instead, they throw money at the problems instead of the solutions. That is government for ya.

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Originally Posted by Newman

I did mention an uptick in the economy towards the end of the year. You want to know why? This recession is media-driven. While it is true that unemployment numbers have gone up, it is no where near record highs.
Banks right now have more cash on hand than ever before in their history. Why? Because they are afraid to lend. (Similar to 9/11 - Airports had mediocre security, then 9/11, now the security borders on stupidity. Same concept.)
The average savings account in the United States has DOUBLE of what was 2 years ago. Why? Because the media is scaring the crap out of most people.
So there is more money in banks than ever before and most people have more money in savings than ever before... Have you been to a mall recently? They are PACKED. My good friend is a car salesman. He says that they are a ton of people looking for cars, but the credit markets are so tight that few can get loans. Does this sound like a true depression situation? It does not to me.

I agree that the government has blown it once again, but what else is new? The ONLY thing that needed to be done to stimulate the economy once again was to tell the banks that they needed to loan the money out given in TARP 1. They could have given them an extra 250 billion (only 25% of this last bailout) to loan out. But, they didnt. Instead, they throw money at the problems instead of the solutions. That is government for ya.

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The banks are not afraid to lend. Problem is they don't have people coming in wanting to borrow. While many Americans are just plain ignorant when it comes to politics, there are a whole bunch more that actually understand a little about money. The current spending totals roughly $3.7 trillion when you figure in interest and adjust for future inflation. Most people actually get the fact that money does not grow on trees, and therefore their logical assumption is that the majority of taxes will need to be raised.

At first, a little more than half of all registered voters drank the Kool-Aid when Obama told everybody he would only tax the rich. Folks are now in the early stages of rethinking the subject of who is really gonna have their taxes raised. I have no idea what State you reside in Newman, but my areas main Shopping Mall in South Eastern CT has 14 "store space for lease" signs on what used to be a retail store just last yr. Our Nations largest city NY, has the highest per-capita increase in State, and City taxes to ever be proposed on the table. NY'ers are about to go into TAX HELL...and that's not considering the Federal increses that will effect all of them. Our largest State California, is not only preparing their residents for their own brand of TAX HELL, they are creating brand new taxes and not just increasing the ones already on the books.

You're right, the banks have boatloads of our (taxpayer) money on their balance sheets. But when Uncle Sam has given Corporate America not a single reason to want to borrow, the little guy, (you and me) will always follow suit. The White House has not given Corporate America one incentive to expand (create jobs). Nor have they done anything for the real job creators, "small businesses". They have done the complete opposite. Washington would love for the perception to be that only the rich delve into the stock market, but truth is, 7 out of 10 Americans are in the market in one fashion or another.

By raising capital gains tax and the tax on dividends, Uncle Sam is certainly not enticing anyone to want to get back into the market. Practically every US manufacturing business will be hit hard by the Obama cap and trade plan. That doesn't even take into effect that the corporate tax rate is going up....WAY UP. Technically, the Corporations have thes taxes on their books, but who do you think pays for them? We do, when they raise their prices to offset the new taxes and higher tax brackets...that's who. Hence, the old adige..."corporations don't pay taxes".

The short term economic future for the US is not looking good by any stretch. When investors don't invest, corporations aren't infused with capital to expand their buisinesses. When Uncle Sam raises all their taxes and even creates new ones, they don't just NOT expand and hire, they downsize, raise their prices, and many file bankruptcy. Just yesterday it was sparcly reported that bankruptcy's for US businesses rose in 2008 by 52% over the prior yr 2007.

It's a good thing many US citizens have a few bucks saved. Their gonna need all the cash they can get their hands on when every product they consume is going up in price.

Well then I guess I am lucky to be blind to the troubles of the US Economy other than through banking, because I know very few (maybe noone) that have TRUELY been affected. The main way that they have become affected is the fact that they cannot get a loan. Take my brother for instance. He has decent credit with a credit score in the low to mid 600s. He has gone to 4 different car dealers and cannot get a loan. He has money to put as a down payment and he has a trade-in, yet he cannot find a loan anywhere.

My parents are another example. They recently bought a peice of beach front land. They were willing to put $25k in cash down on the property (20%). They had to wait for nearly 2 months before they got approved for a loan for the rest. Their credit is PERFECT (50+ years of credit history with no default or late payment EVER). Maybe my family is just cursed...

BTW, I live (and all of this is happening) in Texas.