That’s not to say it will happen, since Radio One is now back in compliance with the Nasdaq minimum trading price rule. But, company shareholders voted to give the board of directors the option of ordering a reverse split if needed.
Radio One’s annual shareholder meeting took place December 16th. And while the company’s stock price has been back in compliance with the Nasdaq minimum price of $1 since official certification in October, there remains some concern at Radio One.
“However, for an extended period of time over the last year, both our Class A and Class D shares traded under $1.00 per share. Given the trading behavior of our stock over the past year, the volatility of the markets and the current macroeconomic environment, we believe that approval of this proposal is prudent to as a preemptive measure in the event of either class of our stock trades under $1.00 again for an extended period of time. Further, certain institutional investors are prohibited from investing in shares priced under certain dollar thresholds. Therefore, effecting a reverse stock split may make our stock more attractive to institutional and other investors by increasing the per share price above such thresholds,” the company said in its proxy.
Shareholders agreed and voted to authorize the board of directors, at its discretion, to effect a reverse split of not less than 1-for-2 and not more than 1-for-50. “While approved by the shareholders, the Board retains the right to determine whether or not to actually effectuate any reverse stock split,” the company announcement noted on Tuesday (12/22).
Also at the meeting, all directors up for re-election were approved to remain on the board.
Terry L. Jones and Brian W. McNeill were elected by holders of the company’s publicly traded Class A shares. The more widely traded Class D shares do not have voting right.
Catherine L. Hughes, Alfred C. Liggins, III, D. Geoffrey Armstrong, Ronald E. Blaylock and B. Doyle Mitchell, Jr. were elected by the Class B shareholders. Those shares do not trade publicly and are all held by CEO Alfred Liggins and his mother, Cathy Hughes, who chairs the board.