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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
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Section 240.14a-12
SEARCH CAPITAL GROUP, INC.
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(Name of Registrant as Specified in its Charter)
NOT APPLICABLE
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[SEARCH CAPITAL GROUP, INC. LETTERHEAD]
September 3, 1996
Dear Shareholder:
Enclosed are our financial statements for the first quarter which are
self-explanatory. I thought I would use this opportunity to again convey the
importance of our upcoming shareholders' meeting on October 1st, and share with
you some of the strategies and reasoning behind the proposal for the 1 for 8
reverse stock split that we are asking you to approve.
1. NASDAQ National Market Listing - With our common stock trading
at $1.13 per share in a very volatile Over-the-Counter market,
we feel that it is essential to become relisted with NASDAQ,
which requires at least a $3.00 per share stock price. Being
listed on NASDAQ should enhance the trading ability of
Search's stock by giving broader visibility to the stock's
trading activity and, thereby, make trade information
available to a wider range of potential investors.
2. Institutional investment - In order for broker/dealers, banks
and other lenders to provide margin loans secured by a
company's stock, the stock must have an average bid price of
at least $5.00 per share. By increasing the price of Search's
shares above $5.00 per share, we hope to attract larger
institutional and individual investors who want (or need) to
take advantage of the ability to margin their stock.
3. Mergers & Acquisitions - We have previously discussed our
intention to grow by acquisition of other companies and/or
portfolios. Stocks which trade at or near $1.00 per share
fall into a category known as "penny stocks" and are
considered to be too volatile and speculative to be utilized
for making acquisitions of other companies. Increasing the
per share trading price of Search's stock should make our
securities more attractive to the financial community and the
investing public, thereby making the stock a more viable
currency to be used for potential acquisitions. Utilizing
stock for acquisitions enables your company to preserve cash
for growth requirements, while increasing equity which can be
leveraged for growth-directed debt financing.
Generally speaking, companies who have had positive happenings during the past
year and who anticipate growth and increased earnings realize a benefit in
stock price from a stock split, especially when it is done for positive,
constructive reasons. We feel this is the case in our scenario and request
your support in voting for the same.
Finally, please be mindful that, management benefits only if the value of our
stock increases for shareholders. We are all in the same boat together, and
your continuing confidence and support are most appreciated.
Thanks for your continued support.
Sincerely,
/s/ GEORGE C. EVANS
GCE:li
Enclosure
