RENO, Nev. - Aqua Metals, Inc. (NASDAQ: NASDAQ:AQMS), a company specializing in sustainable lithium-ion battery recycling, has announced plans for a reverse stock split of its common stock, scheduled to take effect on Monday, November 5, 2024. The approved split ratio is 1 post-split share for every 20 pre-split shares.
This corporate action was authorized by stockholders at a special meeting on October 28, 2024, giving the Board of Directors discretion to choose a split ratio between 1-for-2 and 1-for-20. The board decided on the maximum allowed ratio.
The reverse stock split is set to occur at 12:01 a.m. Eastern Time on the effective date, with trading on a split-adjusted basis to commence as markets open. The total number of issued shares will decrease from approximately 137.6 million to about 6.9 million. This adjustment will be made uniformly across all shareholders, maintaining their proportional equity interests, barring any changes due to the elimination of fractional shares.
Shareholders who would have received a fractional share will instead be compensated with cash, calculated based on the average closing sales prices of the common stock on the Nasdaq Capital Market for the five consecutive trading days preceding the reverse split, adjusted post-split.
Additionally, proportional adjustments will be made to the exercise price and number of shares issuable upon the conversion or exercise of Aqua Metals' equity awards and warrants. Shareholders with shares in brokerage accounts should address their questions about the reverse split to their brokers, while direct stockholders may contact the company's transfer agent, VStock Transfer, LLC.
Aqua Metals, headquartered in Reno, NV, operates with a focus on environmentally friendly recycling solutions, employing its patented AquaRefining™ technology at its Innovation Center. The company's method aims to recover valuable metals from spent batteries with higher purity and lower environmental impact compared to traditional recycling methods.
The information in this article is based on a press release statement from Aqua Metals.
In other recent news, Aqua Metals has reported a series of significant developments. The company has entered into a new sales agreement with The Benchmark Company, while terminating its previous agreement with B. Riley FBR, Inc. This strategic move aims to manage capital and potentially expand operations. Furthermore, Aqua Metals reported an operating loss of $5.8 million for Q1 2024, but secured a $33 million loan for the completion of Sierra ARC Phase 1 and raised additional equity.
The company has also formed strategic partnerships with 6K Energy and PADNOS, with expectations of gaining unique advantages in the battery recycling market. However, the expansion of the Sierra Arc facility has been paused due to the withdrawal of its debt partner. Benchmark and H.C. Wainwright have adjusted their price targets for Aqua Metals' stock following these developments, but both firms maintain a Buy rating, emphasizing the company's long-term potential and the value of its intellectual property.
Additionally, Aqua Metals announced the resignation of board member Edward Smith, without disclosing immediate plans for his replacement. These are the recent developments in Aqua Metals' journey towards commercial production and sustainability in the battery recycling industry.
InvestingPro Insights
As Aqua Metals (NASDAQ: AQMS) prepares for its reverse stock split, investors should consider some key financial metrics and insights provided by InvestingPro. The company's market capitalization stands at a modest $20.6 million, reflecting its position as a niche player in the sustainable battery recycling industry.
InvestingPro data reveals that Aqua Metals has been facing significant financial challenges. The company's revenue for the last twelve months as of Q2 2024 was just $0.03 million, with a staggering gross profit margin of -33,172%. This aligns with an InvestingPro Tip indicating that the company suffers from weak gross profit margins.
Another crucial InvestingPro Tip highlights that Aqua Metals is quickly burning through cash. This is particularly relevant in the context of the upcoming reverse stock split, as it suggests the company may be taking this action to maintain its listing requirements and potentially improve its ability to raise capital.
The stock's performance has been notably poor, with a one-year price total return of -82.02% as of the latest data. This significant decline underscores the challenges the company faces and the rationale behind the reverse split decision.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for Aqua Metals, providing a deeper understanding of the company's financial position and market performance.
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