TUXIS CORPORATION ANNOUNCES INTENTION TO VOLUNTARILY DELIST COMMON STOCK FROM AMERICAN STOCK EXCHANGE AND TERMINATE REGISTRATION AS A PUBLIC COMPANY
Tuxis Corporation (AMEX: TUX) (the "Company") today announced that it has submitted written notice to the American Stock Exchange ("AMEX") of its intention to voluntarily delist its common stock from the AMEX. On or about February 26, 2007, the Company intends to file a Form 25 with the Securities and Exchange Commission ("SEC") to complete the voluntary delisting of its common stock from the AMEX, which will become effective 10 days after the filing date. Subsequently, the Company intends to file a Form 15 with the SEC to terminate the registration of its common stock under the Securities Exchange Act of 1934, as amended ("Exchange Act"). The Company anticipates the termination of registration will become effective 90 days following the filing of the Form 15 with the SEC. Upon filing of the Form 15, the Company's obligation to file certain reports and forms, including Forms 10-KSB, 10-QSB and 8-K, with the SEC will immediately be suspended.
Following the effectiveness of the Form 25 filing, the Company anticipates that its common stock will be quoted over-the-counter in the Pink Sheets to the extent market makers commit to make a market in the Company's shares, although the Company can provide no assurance that trading in the stock will continue. Pink Sheets LLC is an electronic network through which participating broker-dealers can make markets, and enter orders to buy and sell shares of issuers. The Company intends to seek to identify a registered broker-dealer to sponsor the Company's shares in the Pink Sheets, and act as a market maker following delisting of the Company's shares from the AMEX. The Company will further seek additional market makers for the Company's shares following delisting.
The Board of Directors decided to take this action after considering the recommendation of a special committee of the independent members of the Board of Directors created to evaluate the issue. The committee concluded that the disadvantages of maintaining its listing on the AMEX and remaining a public company outweigh the benefits to the Company and its stockholders, and the Board concurred with the committee's recommendation. Among the factors considered were:
- the ongoing costs and expenses, both direct and indirect, associated with being listed on the AMEX and the preparation and filing of the Company's periodic reports with the SEC;
- the increase in costs and expenses that the Company expects to incur as a public company in light of the Sarbanes-Oxley Act of 2002, particularly complying with Section 404 of such Act;
- the limited trading volume and liquidity of the Company's stock on the AMEX; and
- the lack of analyst coverage for the Company's stock.
Delisting and deregistration will allow management to focus its resources on implementing the Company's business plan and position the Company to enhance long-term stockholder value. The Company intends to update its stockholders with financial information on a regular basis.
Commenting on these developments, Mark C. Winmill, Chief Executive Officer of the Company, stated: "Costs associated with public reporting obligations have a real effect on our results. In addition, due to our small market capitalization and modest revenue base, we have not enjoyed many of the benefits traditionally associated with an AMEX listing. Our Board believes that stockholder value is best served through emphasizing future profitability over the limited benefits that have resulted from our current public reporting status and AMEX listing. At this time, we expect to report progress through quarterly earnings announcements and annual audited financial statements. We currently intend to make available annual reports and other information to stockholders on our website, www.tuxis.com."
This release contains certain "forward-looking statements" made pursuant to the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of the Company, which may cause the Company's actual results to be materially different from those expressed or implied by such statements. Such risks, uncertainties and other factors include those described in the Company's filings with the Securities and Exchange Commission. The forward-looking statements made herein are only made as of the date of this release, and the Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.