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| 8-K - COSINE COMMUNICATIONS INC | v207802_8k.htm |
EXHIBIT
99.1
COSINE
STOCKHOLDERS APPROVE PLANS RELATED TO DEREGISTRATION
LOS
GATOS, Calif., January 10, 2011 /PRNewswire-FirstCall/ -- CoSine Communications,
Inc. (Pink Sheets:COSN.pk - News), today announced that its stockholders
approved proposals to amend CoSine's Certificate of Incorporation to effect a
1-for-500 reverse stock split of CoSine’s common stock immediately followed by a
500-for-1forward stock split. Taken together, the amendments are
intended to enable CoSine to deregister its common stock under the Securities
Exchange Act of 1934, as amended, and as a result thereof, terminate its
periodic reporting obligations with the Securities and Exchange
Commission. CoSine is taking these steps to avoid the substantial and
increasing cost and expense of being an SEC reporting company and of regulatory
compliance under the Sarbanes-Oxley Act of 2002, and to focus CoSine's resources
on the redeployment of its existing assets to acquire, or invest in, one or more
operating businesses with existing or prospective taxable income, or from which
it can realize capital gains, that can be offset by use of its net operating
loss carry-forwards.
Subject
to approval by the Financial Industry Regulatory Authority (FINRA) and when
effective, the amendments will result in CoSine’s stockholders of record owning
less than 500 shares of common stock immediately prior to the effective time of
the reverse stock split receiving a cash payment of $2.24 per share, on a
pre-split basis, in lieu of owning fractional shares and participating in the
forward stock split. The reverse stock split will be followed
immediately by a 500-for-1 forward stock split. As a result,
beneficial stockholders holding shares in "street name" through a nominee (such
as a bank or a broker) and CoSine’s stockholders of record owning 500 or more
shares of common stock will not be impacted by the reverse/forward stock splits
and retain their current numbers of shares of common stock without
change.
CoSine
anticipates that upon completion of the reverse and forward stock splits, CoSine
will have fewer than 300 stockholders of record enabling CoSine to terminate the
registration of its common stock under the Securities Exchange Act of 1934, as
amended. CoSine intends to continue to provide interim unaudited
financial information and annual audited financial information to its
stockholders.
Over 95%
of the outstanding shares of common stock of CoSine voted by proxy or in person
at a Special Meeting of Stockholders, which took place on January 10, 2011 in
San Francisco, California. Over 80% of the outstanding shares of
common stock of CoSine voted in favor of the proposals.
For a
more detailed discussion of the reverse/forward stock splits and related
transactions, please see CoSine’s definitive Proxy Statement, filed November 29,
2010 with the Securities and Exchange Commission.
About
Cosine Communications
CoSine
Communications was founded in 1998 as a global telecommunications equipment
supplier. As of December 31, 2006, CoSine had ceased all its product
and customer service related operations. CoSine’s strategic plan is to redeploy
its existing resources to identify and acquire, or invest in, one or more
operating businesses with the potential for generating taxable income and/or
capital gains. This strategy may allow CoSine to realize future cash flow
benefits from its net operating loss carry-forwards (“NOLs”). As of
this date, no candidates have been identified, and no assurance can be given
that CoSine will find suitable candidates, and if it does, that it will be able
to utilize its existing NOLs.
Safe
Harbor Warning
"Safe Harbor" Statement under the
Private Securities Litigation Reform Act of 1995: This release contains
forward-looking statements, which include, among others, statements concerning
CoSine's expected financial performance, exploration of strategic alternatives,
and business outlook, expected performance and developments. The company uses
words such as "anticipate," "believe," "plan," "expect," "future," "intend" and
similar expressions to identify forward-looking statements. These
forward-looking statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those reflected in the
forward-looking statements.
Factors
that might cause such a difference include, but are not limited to, Cosine’s
ability to identify and effectuate desirable strategic acquisitions, the time
and costs required to explore and investigate possible transactions and other
corporate actions, management and board interest in and distraction due to
exploring and investigating strategic alternatives, the reactions, either
positive or negative, of investors, competitors, customers, employees and others
to CoSine exploring and executing possible strategic acquisitions. A
detailed discussion of these factors and other risks that affect CoSine's
business is contained in its SEC filings, including its most recent reports on
Form 10-K and Form 10-Q, particularly under the heading "Risk
Factors." Readers are cautioned not to place undue reliance on these
forward-looking statements, which reflect management's opinions only as of the
date hereof. CoSine undertakes no obligation to revise or publicly release the
results of any revision to these forward-looking statements.
For
additional information contact:
Terry
Gibson
(408)
399-6494
E-mail:
Terry.Gibson@Cosinecom.com