PTC Completes Two-for-Five Reverse Stock Split; Split to Reduce Outstanding Shares Effective February 28, 2006.
This reverse stock split is part of PTC's program to improve its equity structure and bring the Company's total shares outstanding in line with software peers of similar size. "Over the past few years PTC has demonstrated strong financial performance and marketplace success," said Neil Moses, Executive Vice President and Chief Financial Officer of PTC. "At the same time, PTC has implemented numerous measures to improve our equity structure and corporate governance, including implementation of equity compensation plan initiatives that have reduced PTC's stock option overhang from over 30% to less than 20%."
PTC has also committed to reducing the burn rate of equity grants to 2% annually; has moved from stock options to restricted stock for eligible employees; and has recently tied incentive bonuses and 50% of executive officer equity grants to performance-based metrics. Moses continued, "Following the initiatives we have implemented to improve our equity structure to date, we believe it is the right time to take this additional step to bring our shares outstanding in line with similarly sized software companies."
The number of shares of PTC common stock issued and outstanding will be reduced from 277,888,500 shares as of February 27, 2006, to approximately 111,000,000 shares post-split. The number of shares reserved for issuance under PTC's equity compensation plans will also be reduced proportionately. As a result of the reverse stock split, every five shares of common stock of PTC that is issued and outstanding shall be automatically combined into two issued and outstanding shares without any change in the par value of such shares. No fractional shares will be issued in connection with the reverse stock split. Stockholders who would be entitled to fractional shares will receive cash in lieu of receiving fractional shares.
Stockholders who hold their shares in brokerage accounts or "street name" will not be required to take any action to effect the exchange of their shares. Stockholders of record who hold share certificates will receive a letter of transmittal requesting that they surrender their old stock certificates for new stock certificates reflecting the adjusted number of shares as a result of the reverse stock split. American Stock Transfer & Trust Company, PTC's transfer agent, will act as the exchange agent for purposes of implementing the exchange of stock certificates.
PTC (Nasdaq: PMTC) provides leading product lifecycle management (PLM), content management and dynamic publishing solutions to more than 40,000 companies worldwide. PTC customers include the world's most innovative companies in manufacturing, publishing, services, government and life sciences industries. PTC is included in the S&P 500 and Russell 2000 indices. For more information on PTC, please visit http://www.ptc.com.
Statements in this news release that are not historical facts, including statements about the potential benefits to stockholders of the reverse split and our other initiatives to improve our equity structure, are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those projected. Those risks and uncertainties include the following: the total market capitalization of PTC common stock (the aggregate value of all PTC common stock at the then market price) after the reverse stock split may not be equal to or greater than the total market capitalization before the reverse stock split, and the per share market price of PTC common stock following the reverse stock split may not equal or exceed a price in direct proportion to the reduction in the number of shares of PTC common stock outstanding before the reverse stock split (for example, based on the closing market price of PTC common stock on February 27, 2006 of $( ) per share, the per share post-split market price of PTC common stock may not remain at or above $( ) per share or greater); a decline in the market price of PTC common stock after the reverse stock split would result in a greater percentage decline in PTC's market capitalization than would occur in the absence of a reverse stock split; and the liquidity of PTC common stock could be adversely affected following the reverse stock split; as well as other risks and uncertainties detailed from time to time in reports we file with the Securities and Exchange Commission, including our most recent reports on Forms 10-K and 10-Q.
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|Date:||Feb 28, 2006|
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