DALLAS--(BUSINESS WIRE)--RENN Fund, Inc. (NYSE MKT: RCG) (the “Fund”) announced today that the Fund’s shareholders approved the liquidation and dissolution of the Fund at the Fund’s annual shareholders’ meeting held August 4, 2016. The proposal to liquidate and dissolve the Fund received 2,247,604 votes, constituting more than 50% of the outstanding shares of the Fund, in favor of the proposal.
At the annual shareholders’ meeting, shareholders also voted to re-elect Russell Cleveland and Ernest C. Hill as Class Three Directors of the Fund, each of whom is to hold office for a term of three (3) years or until his successor is elected and qualified (or earlier upon the liquidation and dissolution of the Fund).
In accordance with the approved plan of liquidation and dissolution, the Fund plans to make an orderly distribution of available cash and securities after making reasonable provision for known and potential liabilities, obligations and expenses of the Fund. According to Russell Cleveland, CEO and Chairman of the Board, the Board will continue to follow a deliberative process to determine the appropriate timing of liquidating distributions, and to determine whether it is in the best interests of the Fund’s shareholders to make in-kind distributions of certain securities held by the Fund or to sell certain securities and distribute the sale proceeds in cash.
In addition, the Board of Directors has had preliminary discussions, and may have additional discussions, regarding the possibility of another investment firm taking over the management of the Fund with a plan to infuse more capital into the Fund and revitalize it. If the Board were to decide to enter into serious negotiations regarding such an arrangement, and to withdraw and terminate the plan of liquidation and dissolution, it would be required to obtain the approval of the Fund’s shareholders for such a change.
Because the completion of an orderly liquidation of the Funds remaining assets, or any alternative transaction of the type described above, may take several months to complete, the Board of Directors does not intend to immediately set a cessation date for purposes of initiating the process of delisting from, or suspending the trading of the Fund’s shares on, the NYSE MKT.
Further decisions will be publicly announced once the Board has decided on the best way to maximize value for the Fund’s shareholders.
For additional information about the Fund, please visit www.rencapital.com.
This document contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations and beliefs of the Fund’s management and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Such statements involve risks and uncertainties that may cause results to differ materially from those set forth in these statements. Such risks and uncertainties include, but are not limited to, the following: the possibility that the Fund’s Board of Directors could elect to abandon or delay implementation of the plan of liquidation and dissolution; the possibility that the Board of Directors could consider changes in the Fund’s investment adviser, the Fund’s ability to accurately estimate and make reasonable provision for the amounts required to pay all operating expenses, as well as other liabilities and obligations through the dissolution and wind-down process, the precise nature, amount and timing of any distributions to shareholders; the precise timing of the delisting of the Fund’s shares; the possibility that the NYSE MKT may elect to involuntarily delist the Fund’s shares prior to completion of the liquidation and dissolution; the possibility that any distributions to shareholders could be diminished and/or delayed by, among other things, sales of our securities or other assets, unexpected or greater than expected expenses, liabilities or obligations; the possibility that distributions to shareholders may take several years to complete; and other statements contained in this press release regarding matters that are not historical facts. Additional risk factors are more fully discussed in the Fund’s periodic reports filed with the SEC, all of which are available from the SEC’s website (www.sec.gov). The Fund is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events, or otherwise, except to the extent required by applicable law.