More than three months after the Financial Industry Regulatory Authority (FINRA) halted trading on MMTLP, the agency has finally issued a statement. The trading halt sent investors into an uproar as the agency halted trading of MMTLP stock ahead of a highly anticipated spinoff.
Meta Materials (NASDAQ:MMAT) had planned to convert its preferred shares, which traded over the counter under the symbol MMTLP, to Next Bridge Hydrocarbons, a subsidiary it was spinning off into its own company. Both investors and company insiders clamored for accountability and answers, but FINRA did not issue a statement on the matter until March 16.
FINRA’s Statements on MMTLP Stock
On Dec. 21, more than two weeks after the spinoff date, InvestorPlace reported that investors who had been holding MMTLP stock still had yet to receive their Next Bridge shares.
In March 2023, that hasn’t changed, but the organization has finally addressed some of the questions posed by irate investors, issuing an “FAQ: MMTLP Corporate Action and Trading Halt.” In it, the company provided answers to 10 questions, including why they halted trading on MMTLP, if shares had been cancelled and if there is public data available on MMTLP short selling activity.
Anyone still holding MMTLP stock is likely most interested in one specific question, though: “What should investors do if they believe they have not received their Next Bridge shares?” FINRA provided the following response:
“If you held a settled position in MMTLP on December 12, 2022, your account should reflect your position in Next Bridge. Your broker-dealer is required to maintain possession or control of your shares in compliance with federal law. You also may request a transfer of shares from the broker-dealer’s name to your name; however, this transfer may take time to achieve and your broker-dealer or the transfer agent may charge a fee for this service. If you believe that your shares are not properly reflected in your account or your broker-dealer has not been willing to transfer your shares pursuant to your instructions, you should contact your broker-dealer to understand the status of your Next Bridge shares.”
The FAQ also notes that Next Bridge has not been assigned a Committee on Uniform Securities Identification Procedures (CUSIP) number yet. As such, different firms may use different symbols to identify it. It also stresses that shares of MMTLP stock were cancelled by the issuing company, Meta Materials, not by FINRA.
The detailed list of questions also provides some insights into why FINRA halted trading of MMTLP in the first place, citing concerns regarding the fact that, following the spinoff, it would no longer be Depository Trust Company (DTC) eligible. Per the statement:
“Had MMTLP continued trading after December 8, there was the possibility that investors buying MMTLP during that time period may not have realized that those shares were about to be cancelled by Meta Materials, that they may not receive MMTLP shares before they were cancelled, and that they would not be recorded on December 12 as MMTLP holders eligible to receive Next Bridge common stock in the distribution.”
What Comes Next
As of this writing, the future of Next Bridge Hydrocarbons remains uncertain, as it does for MMTLP stock investors. In the FAQ, FINRA highlighted that it had acted within its rights by halting trading on MMTLP. Its statements are in line with InvestorPlace‘s findings during the trading halt period. However, the MMTLP investor community has responded negatively to FINRA’s statement. Many believe their questions have still not been answered properly.
One Twitter user alleges that there are still “hundreds of millions of counterfeit $MMTLP shares sold by financial institutions.” FINRA did not address this claim in the FAQ. This is likely not the end of the saga involving FINRA and MMTLP stock.
On the date of publication, Samuel O’Brient 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.