Shareholders of Support.com, Inc. (NASDAQ:SPRT) voted last week to approve a range of proposals put forward to them during the company’s annual shareholder meeting for 2016. One of the proposals that received shareholder backing is the plan to reverse-split the stock. The shareholders also elected several directors to the board of SPRT, including five directors nominated by the company’s largest shareholder VIEX Capital Advisors.
Reverse splitting the stock
Support.com, Inc. (NASDAQ:SPRT)’s shareholders approved the proposal to amend the company’s certificate of incorporation that allows for the adjustment of the outstanding shares. In that regard, the shareholders gave their nod for the company to reverse-split the stock in a range of 1-for-3 to 1-for-7. With the shareholder green light on the amendment of the outstanding share count, the board of SPRT will sit and decide the best reverse stock split option within the recommended range.
Reverse-splitting the stock will reduce the number of SPRT shares in circulation. It should also theoretically increase the trading price of the shares, but there is no guarantee that would happen because the ultimate trading price of the stock depends on a variety of factors.
Limiting impact of stock dilution
In a move that appears aimed at putting a ceiling to future stock dilution at Support.com, Inc. (NASDAQ:SPRT), shareholders also voted to reduce the company’s authorized shares. It means that SPRT will not have a smaller room to issue more shares in the future than it did before the reverse stock split.
Election of directors at Support.com, Inc. (NASDAQ:SPRT)
Shareholders of Support.com, Inc. (NASDAQ:SPRT) backed the all the five director nominees of VIEX Capital, effectively giving the institutional investor a larger say on the company’s board. VIEX Capital is the largest shareholder in SPRT with ownership of nearly 15% of the company’s outstanding shares.
In addition to the five directors sponsored by VIEX Capital, shareholders also voted to accept SPRT’s own director nominee called Tim Stanley to the board of the company.