Frisco based Comstock Resources, Inc. announced a one-for-five (1:5) reverse split of its issued and outstanding common stock.
The one-for-five reverse stock split will be effective after the market closes on July 29, 2016 and Comstock’s common stock will begin trading on a split-adjusted basis when the market opens on August 1, 2016.
Comstock’s common stock will continue to trade on the New York Stock Exchange under the trading symbol “CRK” but will trade under the new CUSIP number 205768302.
The reverse stock split was necessary in the opinion of the Board of Directors in order for the Company to maintain its listing on the New York Stock Exchange.
Following the reverse split, the number of outstanding shares will be reduced from approximately 62.5 million to approximately 12.5 million. In addition, the number of authorized shares of the Company’s common stock will be decreased from 250 million to 50 million.
Comstock is an energy company based in Frisco, Texas and is engaged in oil and gas acquisitions, exploration and development primarily in Texas and Louisiana.
Understanding reverse-stock split in this scenario
When the reverse stock split becomes effective, every five shares of the Company’s issued and outstanding common stock will automatically convert into one share of common stock. No fractional shares will be issued in connection with the reverse stock split. For any holders that would otherwise be issued fractional shares, the shares to be received in the conversion will be rounded up to the next share.
The reverse stock split will not impact any stockholder’s percentage ownership of Comstock or voting power, except for minimal effects resulting from the treatment of fractional shares.
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