LuxUrban Hotels Inc. (NASDAQ:LUXH), a real estate company based in Miami, Florida, has officially increased its authorized shares to 220 million. This change was filed with the Secretary of State of Delaware on July 8, 2024, as detailed in a recent 8-K filing with the Securities and Exchange Commission.
The amendment to the company's Certificate of Incorporation allows for the issuance of up to 200 million shares of Common Stock and 20 million shares of Preferred Stock, each with a par value of $0.00001. Previously, the company was authorized to issue 100 million shares, including 90 million shares of Common Stock and 10 million shares of Preferred Stock.
This corporate action was approved by LuxUrban Hotels' stockholders on May 16, 2024, through a Joint Action by Written Consent in lieu of a meeting. The stockholders representing 50.67% ownership, a majority of the voting power, consented to the change. This decision followed the board of directors' recommendation to increase the company's share capacity, a move that could potentially facilitate future growth strategies or financing activities.
LuxUrban Hotels, which operates under the Real Estate & Construction sector and is incorporated in Delaware, has its common and preferred stocks listed on The Nasdaq Stock Market LLC under the tickers LUXH and LUXHP, respectively.
The filing also included the Certificate of Amendment to the Certificate of Incorporation as Exhibit 3.1 and an Interactive Data File as Exhibit 104. These documents are part of the official SEC filing and provide further details on the corporate resolution.
This strategic move by LuxUrban Hotels comes as the company continues to navigate the competitive real estate market. The increase in authorized shares could provide the company with the flexibility to pursue various corporate initiatives, including but not limited to, equity financing, stock-based compensation, and strategic acquisitions.
In other recent news, LuxUrban Hotels Inc. has seen significant shifts within the company. The firm has been making strategic changes, including the appointment of Patrick McNamee to its Board of Directors following Brian Ferdinand's resignation. McNamee, with a background in executive roles, will chair the Compensation Committee and serve on the Nominating and Corporate Governance Committee. Additionally, the company has appointed Robert Arigo as CEO and Mike James as Chief Financial Officer.
LuxUrban Hotels has also welcomed finance expert Alexander Lombardo to its board, strengthening its leadership team. A Special Committee has been formed to evaluate strategic initiatives aimed at enhancing shareholder value, which could include mergers, equity and debt financing, or asset sales. Leonard Toboroff has been appointed as the chairman of this committee.
The company has completed a cost reduction program expected to save around $2 million annually and has streamlined its property portfolio. LuxUrban has additionally raised approximately $8.8 million through a public stock offering, with the funds allocated for working capital and general corporate purposes.
However, following the termination of LuxUrban's franchise agreement with Wyndham, Jones Trading downgraded the company's stock from Buy to Hold, projecting a negative impact on short-term earnings. These are recent developments in LuxUrban's ongoing efforts to enhance shareholder value and adapt to market dynamics.
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