All eyes are on Meta Materials (NASDAQ:MMAT) stock, as its spinoff of wholly owned subsidiary Next Bridge Hydrocarbons to shareholders of Meta Materials Preferred Shares (OTCMKTS:MMTLP) has been approved by the board. The date of record will fall on Dec. 12, followed by the distribution date on Dec. 14.
Shareholders should stay up to date with this, as shares of MMTLP will be automatically canceled, lose all of their rights, and no longer be tradable on the over-the-counter (OTC) market following the distribution. In addition, Next Bridge will be an independent public reporting company that is not eligible for electronic transfer through any clearing corporations.
Next Bridge operates as an energy company with a key focus on an oil and natural gas project in the Orogrande Basin in West Texas. The company currently has six full-time employees and hires consultants on an as-needed basis.
MMAT Stock: 10 Things to Know About the Upcoming Meta Materials Spinoff
- Meta will distribute a total of 165,472,241 shares as part of the spinoff. The shares will not be tradable on public markets.
- Each share of MMTLP is eligible to receive one share of Next Bridge. Shareholders are not required to take action to receive the shares.
- The company had interests in three oil and gas projects as of Dec. 31.
- During the three months that ended Sept. 30, the company incurred a net loss of $2.16 million. Net loss totaled $4.76 million for the nine months ended Sept. 30.
- As of Sept. 30, Next Bridge’s accumulated deficit totaled $72.95 million.
- Points no. 4 and no. 5 “raise doubt regarding our ability to continue as a going concern.”
- Next Bridge’s cash and cash equivalents total $2.1 million, while short-term debt totals $21.15 million.
- Oil production is expected to be sold at prices in correspondence with spot oil markets, while natural gas production will likely be sold under short-term contracts. Gas will be priced on “first of the month index prices or on daily spot market prices.” Total production revenue for 2021 totaled $15,904, up 130% year over year from $6,906.
- In addition, Next Bridge noted that it must raise additional capital following the spinoff. This could be completed through debt or equity financing or joint venturing of projects.
- Following the spinoff, the company plans on making offers and/or agreements with one or more of the working interest owners in the Orogrande project. It anticipates offering shares of common stock for working interest.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.