NEW YORK-based BrainStorm Cell Therapeutics Inc. has implemented a reverse stock split of its common stock in a strategic move to satisfy NASDAQ's continued listing requirements. The biotechnology company, specializing in developing innovative autologous cellular therapies for highly debilitating neurodegenerative diseases, announced the reverse stock split at a ratio of one-for-fifteen, effective as of 11:59 p.m. Eastern Time on Sunday.
This corporate action was filed with the Secretary of State of the State of Delaware on September 30, 2024, and is aimed at increasing the per-share bid price of the company's common stock, thereby ensuring it meets the minimum bid price requirement set by NASDAQ. The reverse stock split reduces the number of BrainStorm's outstanding shares, but does not alter the authorized number of shares, which remains at 250 million.
As a result of the reverse stock split, every fifteen shares of issued and outstanding common stock were combined into one share, with no change to the par value per share. Shareholders who would otherwise hold a fractional share will receive a cash payment instead, calculated based on the closing trading price of BrainStorm's common stock on NASDAQ on the last trading day prior to the reverse stock split.
In other recent news, BrainStorm Cell Therapeutics Inc. has announced a one-for-fifteen reverse stock split, a strategic move to regain compliance with NASDAQ's minimum bid price requirement. The company has also made amendments to its stock incentive plans, increasing the shared pool of shares under its 2014 Stock Incentive Plan and 2014 Global Share Option Plan by 8 million shares, and amended its certificate of incorporation to increase the number of authorized shares of common stock from 100 million to 250 million.
In further developments, BrainStorm has reported readiness for the Phase 3b trial of NurOwn in Amyotrophic Lateral Sclerosis (ALS), despite a net loss of $2.5 million in Q2 2024. The company is actively exploring non-dilutive funding options and is in discussions with potential commercial manufacturing partners.
Additionally, BrainStorm's stockholders ratified the appointment of Brightman Almagor Zohar & Co., a member of the Deloitte Global Network (LON:NETW), as the independent registered public accounting firm for the fiscal year ending December 31, 2024. These are the latest updates in a series of recent developments for BrainStorm, reflecting its ongoing efforts to align its corporate structure and incentive mechanisms with its growth strategy.
InvestingPro Insights
BrainStorm Cell Therapeutics' recent reverse stock split comes at a challenging time for the company, as revealed by several key metrics from InvestingPro. The company's market capitalization stands at a modest $17.54 million, reflecting its current struggles. InvestingPro Tips indicate that BrainStorm is "quickly burning through cash" and "suffers from weak gross profit margins," which aligns with the company's need to maintain its NASDAQ listing through the reverse split.
The financial health of BrainStorm appears precarious, with InvestingPro data showing an adjusted operating income of -$16.3 million for the last twelve months as of Q2 2024. This is further compounded by a negative return on assets of -223.03% over the same period, suggesting significant challenges in generating value from its assets.
Despite these headwinds, it's worth noting that BrainStorm "holds more cash than debt on its balance sheet," according to an InvestingPro Tip. This could provide some financial flexibility as the company navigates its current challenges and works to improve its market position following the reverse stock split.
Investors seeking a more comprehensive analysis can access 10 additional InvestingPro Tips for BrainStorm Cell Therapeutics, offering deeper insights into the company's financial situation and market performance.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.