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Signalife Announces Reverse Stock Split, Preferred Stock Dividend and $5 Million Investment

LOS ANGELES, Sept. 10 /PRNewswire-FirstCall/ -- Signalife, Inc. (Amex: SGN) announced that the company's board of directors has approved a consolidation of the company's common stock to be effected in the form of a reverse stock split which will be effected as of 4:30 p.m. EST on September 19, 2008, which will be the record date and time for the reverse stock split. As of such date and time of such reverse stock split, all outstanding shares of Signalife common stock will be consolidated into such number of shares as would result in a $45.00 per share stock price based upon the closing price for the common stock as of the record date. The reverse stock split will be structured in the form of a mandatory share exchange, meaning that each shareholder will be required to first exchange his or her certificate with the company's stock transfer agent in order to change title incident to any sale or other transaction. The exchange of common shares beneficially held in street name (i.e., through a broker-dealer) will most likely be effected through the Depository Trust Corporation without the necessity of the beneficial holder submitting his or her shares for exchange. Shares held directly in the name of the shareholder or other than in street name (such as in the case of the company's principal shareholder, ARC Finance Group, LLC), will need to be exchanged by the shareholder of record with the company's stock transfer agent. Should any shareholder have any questions relating to the mechanics of the mandatory share exchange, he or she should contact Signalife's stock transfer agent, Standard Registrar and Transfer Company, Inc., 12528 South 1840 East Draper, Utah 84020, Tel: 801-571-8844, Fax: 801-571-2551, and e-mail:

Rowland Perkins, Signalife's Chief Executive Officer, stated, "One of the principal reasons for the consolidation is to address the continued illegal short-selling in the company's common stock. It is believed that a significant reduction in the company's public float will reduce or minimize the ability of illegal short sellers to manipulate the market price of the common stock. To address this situation, Signalife has engaged lawyers nationwide in order to assure that every naked short sale (4 days of non-delivery after sale) will be answered instantaneously by a lawsuit in the jurisdiction relevant to the brokerage house. If short sellers wish to get sued, and subject themselves to discovery, every four days, we have lawyers who will oblige them on contingency bases and will move for injunctive relief immediately. The only exceptions will be those persons who unilaterally send a letter to the company that outlines who they are, that they are making a market in the securities, and that they are not conducting any long-term short selling more than 13 days (the SHO threshold list). These must be in writing in order to avoid being sued. Because there will be less than 100,000 shares outstanding after the reverse split, it will be extremely easy for the company's lawyers to track the naked short sales and the company has engaged several service providers who access SEC information to confirm such facts." Signalife reserves the right to not sue anybody who it reasonably believes -- in its own discretion -- is innocent of "mens rea" and Signalife reasonably believes acted without "scienter."

Signalife further announced that Signalife's principal shareholder, ARC Finance Group, LLC, and certain of the company's directors, have each entered into a private placement with the company pursuant to which they agreed to invest a total of $5 million on the first business day after the full implementation of the reverse stock split with the Delaware Secretary of State. Under the terms of the private placement, the investors will purchase a new series of convertible preferred stock, to be designated series 'B', and will be entitled to a number of such preferred shares equal to the $5,000,000 divided by the average closing market price for the common shares as of the date of the commitment or investment, whichever is higher (the "target price"). This series of stock will be redeemable (i.e., the investment will be repaid by Signalife) in five years, together with interest accrued at libor plus 2%. The investors may, after a one-year holding period, convert their investment in the series 'B' preferred shares, including accrued interest, into common shares at the ten-day average closing market price for the common shares as of the date of the conversion, but (1) not less the target price, and (2) not more than two-times the target price. Signalife will also have the right, after six months, to convert all of the series 'B' preferred shares, including accrued interest, into common shares at the ten-day average closing market price for the common shares, subject to the same floor and cap prices applicable to conversions by the holders of the series 'B' preferred shares. Each series 'B' preferred share shall be entitled to one vote on all corporate matters that may be submitted to the company's common shareholders, with the common and series 'B' preferred shares voting as a single class. The series 'B' preferred shares will have a liquidation preference over common shares and all other classes of preferred shares, with the exception of outstanding series 'A' preferred shares. The creation and sale of the series 'B' preferred shares may also be subject to applicable regulatory approvals. The company will also register the series 'B' preferred shares (to the extent permitted by the SEC) under a resale registration statement.

Signalife further announced that the board of directors has approved the creation of a new series of convertible preferred stock, to be designated series 'C', and the declaration of a dividend of those shares to all common shareholders and series 'B' preferred shareholders of record as of the close of trading on December 31, 2008. Each common and series 'B' shareholder as of the record date will receive one series 'C' preferred share for each common share or series 'B' preferred share held. Each series 'C' preferred share will be convertible into common shares in the event the company attains a $100 million market capitalization. Thereafter, each series 'C' preferred shareholder may elect to convert each of his or her preferred shares into five common shares within the first six months of attaining the market capitalization milestone, seven and one-half common shares within the second six months, and ten common shares thereafter. Signalife will reserve the right in its sole discretion to convert all series 'C' preferred shares into common shares at the rate of one common share per preferred share, unless the $100 million market capitalization milestone has been attained, in which event the conversion rate will mirror the rate afforded to a voluntary conversion by the shareholder. The series 'C' preferred shares will have no voting, liquidation or dividend participation rights. The creation and distribution of the series 'C' preferred shares will be subject to applicable regulatory approvals.

According to Mr. Perkins, "This investment by ARC Finance Group and the company's directors in series 'B' preferred shares will ensure that Signalife has sufficient working capital to go forward and implement its sales and marketing plans and strategies over the near future. As will be demonstrated shortly, the F-100 has already saved lives and there are human beings walking around (as well as their physicians) who will demonstrate that without the F-100 they would have died. One of them is a 16-year old wrestler. I will announce the particulars when I determine in my discretion that the time is right. In this regard, considering that the F-100 is revolutionary and will save lives, the distribution of a dividend in series 'C' shares will reward shareholders who take a longer-view in holding the company's common shares. Management construes these as very positive developments, demonstrating our commitment to the technology and our confidence in the company's future, together with our commitment to eliminate the manipulation of our stock price to the detriment of our long-term shareholders."

Finally, we have received notice that numerous non-shareholders whose lives have been saved -- and others who cannot afford to travel to a screening event -- will be intervening in the current lawsuits and suing brokerage houses and co-conspiratorial lawyers for preventing them from obtaining potentially life-saving heart screenings. We do not know who will be representing these human beings and have no further knowledge related thereto.

About Signalife

Signalife, Inc. is a life sciences company focused on the monitoring, detection and prevention of disease through continuous biomedical signal monitoring. Signalife uses its patented signal technology to design and develop medical devices, therapies and/or technologies that simplify and reduce the costs of cardiovascular disease.

Signalife, Inc. is traded on the American Stock Exchange under the symbol SGN. More information is located at Clear Data. Trusted Results.

Caution Regarding Forward-Looking Statements

Statements in this release that are not strictly historical are "forward-looking" statements. Forward-looking statements involve known and unknown risks, which may cause the companies' actual results in the future to differ materially from expected results. Factors which could cause or contribute to such differences include, but are not limited to, failure to complete the development and introduction of heart monitoring and other biomedical devices incorporating the companies' technology procure market acceptance for these products, failure to obtain federal or state or governmental or international regulatory approvals governing heart monitoring and other biomedical devices incorporating the technology, failure to obtain import and export capabilities in the various countries containing buyers and resellers and hospitals and clinics and doctors for the devices, inability to obtain physician, patient or insurance acceptance of or for heart monitoring and other biomedical incorporating of the technologies, and the unavailability of financing to complete management's plans will pose substantial regulatory and legal risks to those who wish to engage in repeated naked short selling. All of these risks are qualified objectives, including the development of heart monitoring and other biomedical and information solutions incorporating the companies' technologies. There is also a risk of extraordinary and documented short selling, and two related lawsuits -- one a class action against former Signalife CEO's and current lower level management, and the other a large lawsuit by Signalife for the theft of assets and other activities brought about by the naked short sellers. The public is advised that these lawsuits and the risk of naked short selling pose risks. However, naked short sellers are advised that Signalife now has the means of evaluating each naked short trade and -- because there will be far less stock outstanding after the date of the reverse stock split -- any naked short selling (i.e., without borrowing stock, lawfully) will subject the culprits to lawsuits including state and federal lawsuits and wrongful death lawsuits. These risks are subject, in their entirety, by cautionary language and risk factors set forth and to be further described in Signalife's filings with the Securities and Exchange Commission.

SOURCE Signalife, Inc.
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