Meta Materials Announces Proposed SEC Settlement

Rhea-AI Summary

Meta Materials Inc. (META) announced a proposed SEC settlement regarding an investigation by the Securities and Exchange Commission (SEC) related to a merger involving Torchlight Energy Resources, Inc. and Metamaterial Inc. The settlement, subject to approval by the SEC Commissioners, involves a cease-and-desist order and a civil money penalty of $1 million in four installments over one year. The Company believes the settlement is in the best interests of its shareholders, aiming to remove uncertainty and allow the business to progress.

Positive

• None.

Negative

• The proposed SEC settlement may indicate past irregularities or non-compliance with securities laws, potentially impacting the company's reputation and investor confidence.

Insights

Financial Analyst

The announcement of Meta Materials Inc.'s proposed SEC settlement is a pivotal development for the company and its investors. The financial implications of the $1 million civil penalty, although not substantial for a large corporation, indicate a resolution to the uncertainties surrounding the SEC investigation. Payment in installments over a year suggests a manageable impact on the company's cash flow. Investors should note that the resolution of such regulatory issues can restore investor confidence and potentially lead to a re-evaluation of the company's stock. However, the lack of admission or denial in the settlement does not provide full closure regarding the alleged issues, leaving some questions about corporate governance and risk management practices.

Legal Expert

From a legal perspective, the significance of the cease-and-desist order lies in its preventive nature, aiming to ensure compliance with securities laws going forward. This development is critical as it reflects the company's commitment to rectifying procedural deficiencies. The legal ramifications extend beyond the immediate financial penalty; they necessitate a review of internal controls and may trigger changes in reporting and operational protocols. Stakeholders should monitor the company's response to these requirements, as they can provide insights into the robustness of Meta Materials' corporate governance framework.

Market Research Analyst

Meta Materials Inc.'s settlement with the SEC removes a major overhang on the company's reputation and future business prospects. The resolution will likely be well-received by the market, as it eliminates a significant risk factor and allows management to refocus on core business strategies and innovation in advanced materials and nanotechnology. It is essential to consider industry benchmarks for regulatory compliance and the potential competitive advantage that can arise from demonstrating adherence to high ethical standards. This settlement could serve as a benchmark for industry peers and influence investor perception of the sector's regulatory landscape.

HALIFAX, NS / ACCESSWIRE / January 11, 2024 / Meta Materials Inc. (the "Company" or "META") (Nasdaq:MMAT), an advanced materials and nanotechnology company, today announced a proposed SEC settlement.

As previously disclosed, Meta Materials Inc. (the "Company") has been the subject of an investigation (the "Investigation") by the Securities and Exchange Commission (the "SEC" or the "Commission") with respect to, among other things, the merger involving Torchlight Energy Resources, Inc. and Metamaterial Inc. In connection with the Investigation, the Company announced in a Form 8-K filed on July 25, 2023 that the Company and two individuals (Messrs. Brda and Palikaras) received Wells Notices.

The Company recently made an offer of settlement to the Staff of the SEC's Division of Enforcement (the "Proposed SEC Settlement") to resolve the matter as to the Company. The Proposed SEC Settlement is subject to approval by the SEC Commissioners. The Company cannot predict whether or when the Proposed SEC Settlement will be approved. If the Commissioners approve the Proposed SEC Settlement, the Commission will enter a cease-and-desist order (the "Order") in connection with certain antifraud, reporting, books and records, and internal accounting control provisions of the securities laws. Under the terms of the Proposed SEC Settlement, the Company would neither admit nor deny the findings in the Order. If approved, in connection with the Proposed SEC Settlement, the Company will pay a civil money penalty in an amount of $1 million in four (4) installments over the period of one (1) year pursuant to an agreed upon payment plan.

The Company, its board of directors, and its management team believe the Proposed SEC Settlement is in the best interests of our shareholders. If approved by the Commissioners, it would remove uncertainty related to the Investigation and allow the Company to move forward in achieving its business objectives.

About Meta Materials Inc.

Meta Materials Inc. (META) is an advanced materials and nanotechnology company. We develop new products and technologies using innovative sustainable science. Advanced materials can improve everyday products that surround us, making them smarter and more sustainable. META® technology platforms enable global brands to develop new products to improve performance for customers in aerospace and defense, consumer electronics, 5G communications, batteries, authentication, automotive and clean energy. Learn more at www.metamaterial.com.

Media and Investor Inquiries

Rob Stone
Vice President, Corporate Development and Communications
Meta Materials Inc.
media@metamaterial.com
ir@metamaterial.com

Forward Looking Information

This press release includes forward-looking information or statements within the meaning of Canadian securities laws and within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, regarding the Company, which may include, but are not limited to, statements with respect to the business strategies, product development, restructuring plans and operational activities of the Company. Often but not always, forward-looking information can be identified by the use of words such as "pursuing", "potential", "predicts", "projects", "seeks", "plans", "expect", "intends", "anticipated", "believes" or variations (including negative variations) of such words and phrases, or statements that certain actions, events or results "may", "could", "should", "would" or "will" be taken, occur or be achieved. Such statements are based on the current expectations and views of future events of the management of the Company and are based on assumptions and subject to risks and uncertainties. Although the management of the Company believes that the assumptions underlying these statements are reasonable, they may prove to be incorrect. The forward-looking events and circumstances discussed in this release may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting the Company, the capabilities of our facilities, research and development projects of the Company, the total available market and market potential of the products of the Company, the market position of the Company, the need to raise more capital and the ability to do so, the scalability of the Company's production ability, capacity for new customer engagements, material selection programs timeframes, the ability to reduce production costs, enhance metamaterials manufacturing capabilities and extend market reach into new applications and industries, the ability to accelerate commercialization plans, the possibility of new customer contracts, the continued engagement of our employees, the technology industry, market strategic and operational activities, and management's ability to manage and operate the business. More details about these and other risks that may impact the Company's businesses are described under the heading "Forward-Looking Information" and under the heading "Risk Factors" in the Company's Form 10-K filed with the SEC on March 23, 2023, in the Company's Form 10-K/A filed with the SEC on March 24, 2023, in the Company's Form 10-Q filed with the SEC on November 13, 2023, and in subsequent filings made by Meta Materials with the SEC, which are available on SEC's website at www.sec.gov. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Accordingly, readers should not place undue reliance on any forward-looking statements or information. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and the Company does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the extent required by law.

SOURCE: Meta Materials Inc.

View the original press release on accesswire.com

FAQ

What is the proposed SEC settlement announced by Meta Materials Inc. (META)?

The proposed SEC settlement involves a cease-and-desist order and a civil money penalty of $1 million in four installments over one year, subject to approval by the SEC Commissioners.

What was the investigation by the Securities and Exchange Commission (SEC) related to?

The investigation was related to a merger involving Torchlight Energy Resources, Inc. and Metamaterial Inc.

What are the terms of the proposed settlement?

Under the terms of the proposed SEC settlement, Meta Materials Inc. would neither admit nor deny the findings in the Order, and would pay a civil money penalty of $1 million in four installments over one year.

Why does Meta Materials Inc. believe the proposed SEC settlement is in the best interests of its shareholders?

The company believes the settlement would remove uncertainty related to the investigation and allow it to move forward in achieving its business objectives.