SAN JOSE, Calif. - Momentus Inc. (NASDAQ: NASDAQ:MNTS), a commercial space company known for its satellite services, has entered into an agreement for a private placement of securities with a U.S. institutional investor. The deal includes the sale of 5 million shares of common stock at $0.55 each, resulting in gross proceeds of approximately $2.75 million. The transaction is expected to close Tuesday, subject to customary conditions.
In addition to the shares, Momentus will issue two classes of Common Warrants to the investor. Class A Warrants allow the purchase of up to 10 million shares, while Class B Warrants provide for up to 5 million shares, both at an exercise price of $0.575. The Class A Warrants are valid for five and a half years post-issuance, and the Class B Warrants for 18 months.
The company has announced its intention to use the net proceeds for general corporate purposes. These may include payments to its accounting firm and tax advisors, debt repayment, capital expenditures, and supporting its working capital needs. Momentus has stated that the funds will not be used for stock redemption or in violation of FCPA or OFAC regulations.
A.G.P./Alliance Global Partners (NYSE:GLP) is the sole placement agent for this offering. The securities presented in this agreement will not be registered under the Securities Act of 1933 and will be offered under an exemption from registration requirements.
Momentus has committed to filing a registration statement with the SEC for the resale of the issued securities within 28 days following the agreement, aiming for prompt effectiveness.
This press release does not constitute a sale offer or solicitation in any jurisdiction where such actions would be unlawful.
Based on a press release statement, Momentus is a provider of satellite buses and in-space infrastructure services, including transportation and hosted payloads. The company's future plans and use of proceeds from the offering are subject to various risks and uncertainties, as detailed in their SEC filings.
In other recent news, Momentus Inc. has made several significant strides. The company announced a preliminary financial update, anticipating revenues of $1.0 to $2.0 million for the first half of 2024, with a projected net loss between $14.0 and $16.0 million. Momentus also secured a $2.3 million convertible note from Space Infrastructure Ventures, LLC, and settled shareholder derivative litigation, leading to the adoption of corporate governance reforms.
Momentus has joined the Defense Advanced Research Projects Agency's (DARPA) BRIDGES consortium, a move that marks a significant step into the U.S. Government classified market. The company's collaboration with London-based Lodestar Space, backed by a grant from the United Kingdom Space Agency, aims to equip its Vigoride Orbital Service Vehicle with a new robotic arm, enhancing its capabilities for dynamic operations in space.
However, the company faces potential Nasdaq delisting due to delayed financial filings, and it has until October 21, 2024, to submit a compliance plan. Despite this, Momentus was selected by NASA as a launch provider in the VADR contract and continues to demonstrate its ongoing involvement in space infrastructure and launch services. Lastly, the company saw a leadership change with the appointment of Lon Ensler as the interim Chief Financial Officer, following the departure of Eric Williams.
InvestingPro Insights
Momentus Inc. (NASDAQ: MNTS) has recently structured a deal to enhance its financial position, but InvestingPro data and tips provide a deeper look into the company's financial health and market performance. With a market capitalization of just $9.51 million, the company's size is relatively small in the expansive aerospace sector. Notably, Momentus has demonstrated a significant revenue growth of over 933% in the last twelve months as of Q4 2023, which aligns with analysts' expectations for continued sales growth in the current year. This growth factor could be a signal to potential investors of the company's expanding market presence.
However, the company's gross profit margin stands impressively at 72.32%, indicating strong operational efficiency in generating profit from its revenues. Despite this, Momentus is grappling with a substantial debt burden, as reflected by an operating income margin of -2206.93%, which raises concerns about its ability to manage and make interest payments on its debt. The InvestingPro Tips also highlight that the company is quickly burning through cash and has not been profitable over the last twelve months, which could be contributing factors to the stock's significant hit over the past week, with a price total return of -14.6%.
Investors should also note that Momentus does not pay a dividend, which could influence investment decisions for income-focused portfolios. The company's stock is known to trade with high price volatility, which might appeal to certain investors but also implies a higher risk profile. For those considering Momentus as a potential investment, there are over 14 additional InvestingPro Tips available that can provide further insight into the company's financial health and market standing. For a more comprehensive analysis, interested parties can visit InvestingPro at https://www.investing.com/pro/MNTS.
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