WALL TOWNSHIP, N.J., Sept. 3, 2013 /PRNewswire/ -- Coates International, Ltd. (OTCQB: COTE) – Intending to enhance the value of the Company's common stock to the Coates shareholders, George J. Coates decided to return and cancel all shares of common stock previously issued to him for anti-dilution.
Mr. Coates stated: "I am very pleased to remove my anti-dilution shares of common stock from the number of shares outstanding. It is my expectation that this will enhance the value of the shares of common stock to our stockholders because it will reverse the dilution originally experienced when the shares were issued."
In addition, the common stock component of the Company's anti-dilution program in effect for Mr. Coates has been terminated, effective immediately. The estimated fair value of the canceled shares aggregated $2,181,483. This amount was previously charged to stock-based compensation expense.
Cancelation of Mr. Coates' common stock will reduce the number of the Company's outstanding shares of common stock by 35,037,131 shares. This almost 10% decrease in outstanding shares reduces the number of outstanding shares from 354,428,034 to 319,390,903. The canceled shares are being restored to authorized and unissued status.
In place of the common stock, the Company issued 57,747 shares of its Series A, Preferred Stock ("Preferred Stock") to Mr. Coates. As a result of the issuance of these shares of Preferred Stock, the Coates family members will continue to hold 93.93% of all votes. The Company will continue to issue additional anti-dilution shares of Preferred Stock to Mr. Coates in the future in order to maintain the Coates family members' percentage of eligible voting shares at 93.93%. The Preferred Stock has no conversion features, does not share in dividends or have any liquidation preference. However, each share of Preferred Stock entitles the holder to 10,000 votes on any matter brought before the shareholders for a vote.
Safe Harbor Statement:
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Please see our filings with the Securities and Exchange Commission. Our public filings with the SEC may be viewed and printed on the website maintained by the SEC at http://www.sec.gov.
Coates International, Ltd.
SOURCE Coates International, Ltd.