Meta Materials Seeks Approval to Raise Authorized Shares by 2,400%


  • Meta Materials (MMAT) has disclosed a proposal to increase the number of authorized shares to 250 million from 10 million.
  • The votes for the proposal will be revealed at the company’s special meeting of stockholders on April 15.
  • MMAT stock is down by over 50% this year.
MMAT stock - Meta Materials Seeks Approval to Raise Authorized Shares by 2,400%

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As of now, there are 10 million authorized shares of Meta Materials (NASDAQ:MMAT) stock. However, that figure could increase by a whopping 2,400% to 250 million shares at Meta’s upcoming special meeting of stockholders on April 15.

During the meeting, the votes for three proposals will be revealed. Although the proposal to increase authorized shares from 10 million to 250 million is the only material proposal. The other two proposals are customary and involve adjourning the meeting if the authorized share increase proposal does not receive enough votes and transacting business as usual prior to the meeting.

MMAT Stock: Meta Materials Announces Proposal to Increase Authorized Shares by 2,400%

Meta Materials had previously enacted a reverse stock split on Jan. 29 in order to regain compliance with Nasdaq’s minimum bid requirement of $1. On Feb. 12, Nasdaq notified the company that it was in full compliance.

“As a result of the Reverse Stock Split and capital raising activities to fund ongoing operations and product development, as of February 21, 2024, the Company has 1,824 shares of Common Stock authorized and unissued and not reserved for any other purpose, which is insufficient for the Company’s ongoing needs and operations,” said Meta.

Earlier this month, Meta announced a $3.4 million direct offering for a single institutional investor. The company also announced changes for warrants to purchase up to 324,075 shares of MMAT stock. As part of the warrant amendment, Meta agreed to create a proposal to increase its authorized shares to 250 million at its next annual or special meeting of stockholders. The institutional investor in the offering agreed to use “commercially reasonable efforts” to vote in favor of the proposal.

Meta listed several reasons for increasing its authorized shares. These include raising capital to support its business, equity awards for employees, potential strategic transactions and “potential negotiations with third parties to satisfy the Company’s existing payment obligations in shares of Common Stock rather than cash.”

Meta Materials added that it has no current plans to issue any shares if the proposal is approved. However, the issuance of additional shares will still lead to dilution.

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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 Publishing Guidelines.  

Eddie Pan specializes in institutional investments and insider activity. He writes for InvestorPlace’s Today’s Market team, which centers on the latest news involving popular stocks.

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