San Francisco (PRWEB) July 2, 2010
Cardiac Network, Inc. (Other OTC:CNWI.PK), a developer of advanced mobile medical monitoring systems, confirmed today that it has received a cease and desist notice from a law firm on behalf of a group representing themselves as “majority shareholders” of Cardiac Network’s common stock and opposing the proposed reverse stock split (the “Reverse Stock Split”) previously announced by the Company, effectively putting the Reverse Stock Split on hold while the Company assesses the claims being made by the group.
The notice identifies shareholders that include a former founder and CEO of Cardiac Network and other former members of the Company’s Board of Directors, although the exact amount of shares represented by the group was not disclosed in the notice. The Company estimates the group identified in the opposition notice holds or controls approximately 26 million of unrestricted common shares, or approximately 32% of the 82,008,355 common shares outstanding as of June 1, 2010.
The Company previously announced on June 10, 2010 that the Board of Directors approved the Reverse Stock Split and would seek to obtain approval from a majority of the holders of the Company’s outstanding Common Stock as required before the Reverse Stock Split can become effective.
The proposed Reverse Stock Split, if approved, would reduce the number of shares outstanding and adjust the company’s price per share when the Reverse Stock Split becomes effective. The Company also previously stated that if it obtained shareholder approval, it would seek to complete the necessary filings with the Financial Industry Regulatory Authority (“FINRA”) in order to seek FINRA approval and be assigned a new CUSIP number in connection with the Reverse Stock Split.
The Company believes that a reverse stock split may allow the Company a better opportunity to raise capital and the Company’s Common Stock may trade at a higher share price level depending on market and trading conditions at the time that a reverse stock split takes effect.
Further, raising capital is critical to the Company’s development program for a next generation of cardiac monitors. Any delay or inability to raise capital to continue the development activities will delay the ultimate completion of the development project and jeopardizes the relationships with the Company’s technology and manufacturing partners. The Company will continue to explore strategic, funding and partnering opportunities to further its technology development program.
More information on the Company’s proposed Reverse Stock Split will be made available as soon as more information is known.
About Cardiac Network:
Cardiac Network, Inc. is a medical technology company developing products to provide cardiac monitoring and diagnostic services to general practitioners and specialist physicians, for the investigation of patients with abnormal cardiac rhythm and function. Prior services have used unique transtelephonic (by telephone) cardiac recorders that monitor and provide diagnostic information to physicians and their patients. Cardiac Network also intends to offer its services to individuals to help them quickly determine if they are having potential cardiac problems so they can obtain immediately needed medical treatment. Learn more about Cardiac Network, Inc. by visiting http://www.cardiacnetwork.net.
This press release contains “forward-looking statements.” Forward-looking statements are statements concerning plans, objectives, goals, strategies, expectations, intentions, projections, developments, future events, or performance, underlying (expressed or implied) assumptions and other statements that are other than historical facts. These forward-looking statements are only predictions. No assurances can be given that such predictions will prove correct. Actual events or results may differ materially. Forward-looking statements should be read in light of the cautionary statements and risks that include, but are not limited to, the risks associated with a small company, our limited financial resources, and the uncertainties of competitive pressures we face. We can be certain that we will obtain approval from the holders of a majority of our outstanding common stock or the precise numerical size of the planned reverse stock split. These or other risks could cause actual results to differ materially from the future results indicated or implied in such forward-looking statements. We undertake no obligation to update or revise such statements. For additional information on these risks and uncertainties, please refer to our filings on pink sheets.
Cardiac Network, Inc.