First Physicians Capital Group (FPCG) – Going Private Transaction – $220 Upside

Current Price – $0.44

Offer Price – $0.55

Upside – 25% or $220 for holders of 1999 shares

Expiration date – not announced yet

SEC Filling

Trading Strategy:

Buy 1999 shares of FPCG and wait for reverse-split after the shareholder meeting (meeting date has not been set yet)


The Board has authorized a 1-for-2,000 Reverse Stock Split, subject to stockholder approval at the Meeting. The intended effect of the Reverse Stock Split is to reduce the number of record holders of our common stock to fewer than 300 holders, so we will be eligible to deregister our common stock with the Securities and Exchange Commission. As a result of the Reverse Stock Split, stockholders owning fewer than 2,000 shares of our Common Stock will be cashed out at a price of $0.55 per pre-split share. 

Shareholder Approval:

The reverse stock split is subject subject to stockholder approval at the Meeting (date has not been set yet). However, major shareholders (who control 35% of stock) indicated the deal to be fair, so would assume the voting will pass without problems.

Source of Funds:

We currently anticipate having the financial resources to complete the Reverse Stock Split, the costs of which we estimate to be $505,000. The estimated costs include $225,000, which is the approximate cost to satisfy the Company’s obligation to pay cash for each fractional share resulting from the Reverse Stock Split. The payments to holders who receive cash in lieu of fractional shares will be paid out of cash on hand. As of June 20, 2014, we had approximately $2.0 million of cash on hand.