Upon quick review, this appears to be a stock swap in which your 30,000 shares are worth exactly the same as 1,000 shares of the new entity after the swap.
The number of authorized shares has very little to with the value of shares that are issued at any given time.
add: it also begs the question why anyone would "sell" their company in exchange for essentially zero financial advantage...
OK, so a split is where you divide shares (you get more). A reverse split is the opposite of a split (you get less). In UK we call it a consolidation.
In a way splits or consolidations are just book keeping entries. All things being equal (which they aren't) the value of your holding will be the same.
For example 100 shares at ￡1 consolidated would be 10 shares at ￡10 each.
I admit to not being stock/financially literate. I am hoping that someone will be able to explain this to me in more simple terms. Thanks you in advance!
On January 22, 2014, AvWorks Aviation Corp., a Florida corporation (the "Company" or the “Registrant”) entered into an Agreement of Merger and Plan of Reorganization ("Merger Agreement") by and among the Company and the Vapor Group, Inc., a Florida corporation ("Vapor Group") and the shareholders of Vapor Group (the “Vapor Group Shareholders”), pursuant to which the Company will acquire 100% of the issued and outstanding shares of Vapor Group from the Vapor Group Shareholders. The Merger Agreement shall become effective as soon as practicable.
In accordance with the terms and provisions of the Merger Agreement: (i) the Company will acquire from the Vapor Group Shareholders an aggregate 350,000,000 shares of common stock of Vapor Group representing 100% of the issued and outstanding shares of Vapor Group; (ii) in exchange thereof, the Company will issue to the Vapor Group Shareholders an aggregate 750,000,000 shares of its common stock, to be issued following a 30 to 1 reverse split to occur within thirty (30) days of Closing (the “Reverse” below); (iii) Vapor Group will transfer and assign to the Company all existing material contracts including those related to distribution, licensing and marketing and those dealing with the grant of rights for the use of any and all intellectual property; (iv) the Company will assume all other assets of Vapor Group, including licenses, equipment, product designs, marketing and sale materials, logos, trademarks, copyrights and websites; and (v) the Company further will assume all liabilities of Vapor Group, including all trade and debt obligations. The proposed acquisition will be accomplished by the merger of Vapor Group with and into AvWorks Aviation Corp., with AvWorks Aviation Corp. being the surviving corporation (the "Merger").
In preparation of and prior to the Closing of the Merger Agreement, the Company is required to increase its authorized shares of Common Stock to 2,000,000,000 from 500,000,000 (the “Increase in Authorized Shares”).
Within five (5) business days subsequent to Closing, the Company is required to file an “Information Statement” specific to the filing of a 30 to 1 reverse split of its issued and outstanding common stock, to occur not later than thirty (30) days after the date of Closing (the “Reverse”).
Sooo...example
If I 30,000 shares, after the split I will own 1,000 shares? Except there will be 750,000,000 new shares which means I am getting screwed over? Hopefully I'm wrong!
