Oblong Announces Reverse Stock Split

Rhea-AI Summary

Oblong (Nasdaq: OBLG), a multi-stream collaboration solutions provider, has announced a 1-for-40 reverse stock split effective August 23, 2024. The company's shares will begin trading on a split-adjusted basis on the Nasdaq Capital Market on August 26, 2024. This move aims to increase the per-share trading value to meet Nasdaq's continued listing standards.

The reverse split will reduce Oblong's outstanding common shares from approximately 28,242,000 to 710,000. It won't affect stockholders' percentage ownership, except for fractional shares, which will be rounded up. The split will also adjust the exercise or conversion prices of outstanding options, warrants, and preferred stock shares proportionately.

Positive

• Potential to meet Nasdaq Capital Market's continued listing standards
• No change in stockholders' percentage ownership interest
• Fractional shares will be rounded up to the nearest whole share

Negative

• Significant reduction in the number of outstanding shares from 28,242,000 to approximately 710,000
• Possible indication of financial difficulties or low stock price

Insights

Financial Analyst

Oblong's 1-for-40 reverse stock split is a strategic move to maintain Nasdaq listing compliance, but it's a double-edged sword. While it artificially boosts the share price, it doesn't change the company's fundamental value. The reduction from 28,242,000 to 710,000 shares could improve liquidity and attract institutional investors. However, it's often seen as a red flag, indicating underlying financial struggles. The rounding up of fractional shares is a minor positive, but overall, this move suggests Oblong is fighting for survival rather than thriving. Investors should scrutinize Oblong's financials and growth prospects before making decisions based solely on this cosmetic change.

Market Research Analyst

This reverse split reflects broader market challenges for small-cap tech companies. Oblong's multi-stream collaboration solutions face fierce competition in a saturated market dominated by giants like Zoom and Microsoft Teams. The split might temporarily boost investor interest, but it doesn't address fundamental issues. Key questions remain:

• How does Oblong differentiate its product?
• What's its path to profitability?
• Can it compete effectively against well-funded rivals?

Without clear answers, this financial maneuver may only delay inevitable challenges. Investors should watch for post-split performance and any strategic shifts in Oblong's business model.

Shares Will Begin Trading on a Split-Adjusted Basis on August 26, 2024

DENVER--(BUSINESS WIRE)-- Oblong, Inc. (Nasdaq: OBLG) (“Oblong” or the “Company”), the award-winning maker of multi-stream collaboration solutions, announced today that it has filed an amendment to its certificate of incorporation that will effect a reverse stock split of the Company's issued and outstanding shares of common stock by a ratio of 1-for-40, as approved by the Company’s stockholders at its 2023 annual meeting and the Company’s board of directors. The reverse stock split will become effective at 5:00 PM Eastern Time on August 23, 2024, and the Company's shares of common stock will begin trading on a split-adjusted basis on the Nasdaq Capital Market at the commencement of trading on August 26, 2024 under the Company's existing trading symbol “OBLG.”

The reverse stock split is intended to increase the per share trading value of the Company’s common stock to satisfy the Nasdaq Capital Market’s continued listing standards. The reverse stock split will be effected simultaneously for all outstanding shares of the Company’s common stock, and will affect all of the Company’s stockholders uniformly. At the effective time, every 40 issued and outstanding shares of common stock will be converted into one share of common stock. The Company’s common stock has been assigned a new CUSIP number of 674434303 in connection with the reverse stock split. The reverse stock split will not affect any stockholder’s percentage ownership interest in the Company, except to the extent that it results in any of the Company’s stockholders owning a fractional share, as any resulting fractional share will be rounded up to the nearest whole share. The reverse stock split will reduce the number of shares of the Company’s common stock from approximately 28,242,000 shares to approximately 710,000 shares. The reverse stock split will not affect the number of authorized shares of the Company’s common stock or the par value of a share of common stock. Proportionate adjustments will be made to the per share exercise price or conversion price and the number of shares issuable upon the exercise or conversion of all outstanding options, warrants and shares of preferred stock, as applicable.

Information for Stockholders

Stockholders holding their shares in book-entry form with the Company’s transfer agent, Equiniti Trust Company, or in brokerage accounts, do not need to take any action in connection with the reverse stock split. Stockholders holding shares of the Company’s common stock with a bank, broker or other nominee are encouraged to contact their bank, broker or other nominee with any questions regarding their holdings. The Company’s transfer agent is also acting as the exchange agent for the reverse stock split, and will provide instructions to any stockholders holding certificated shares regarding the process for exchanging their share certificates.

Any fractional shares of common stock resulting from the reverse stock split will be rounded up to the nearest whole post-split share and no stockholders will receive cash in lieu of fractional shares.

Additional information regarding the reverse stock split is available in the Company’s definitive proxy statement filed with the U.S. Securities and Exchange Commission (“SEC”) on October 30, 2023.

Forward looking and cautionary statements

This press release contains forward-looking statements as defined under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, that address activities that the Company assumes, plans, expects, believes, intends, projects, estimates or anticipates (and other similar expressions) will, should or may occur in the future are forward-looking statements. The Company’s actual results may differ materially from its expectations, estimates and projections, and consequently you should not rely on these forward-looking statements as predictions of future events. Without limiting the generality of the foregoing, forward-looking statements contained in this press release include statements regarding the impact of the reverse stock split on the per share trading value of the Company’s common stock and the Company’s intention to regain compliance with the Nasdaq Capital Market’s continued listing standards. The forward-looking statements are based on management’s current belief, based on currently available information, as to the outcome and timing of future events, and involve factors, risks, and uncertainties that may cause actual results in future periods to differ materially from such statements. A list and description of these and other risk factors can be found in the Company’s Annual Report on Form 10-K for the year ending December 31, 2023, the Company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2024, the Company’s Quarterly Report on Form 10-Q for the three months ended June 30, 2024 and in other filings made by the Company with the SEC from time to time. Any of these factors could cause the Company’s actual results and plans to differ materially from those in the forward-looking statements. Therefore, the Company can give no assurance that its future results will be as estimated. The Company does not intend to, and disclaims any obligation to, correct, update or revise any information contained herein.

About Oblong, Inc.

Oblong (Nasdaq: OBLG) provides innovative and patented technologies that change the way people work, create, and communicate. Oblong’s flagship product Mezzanine™ is a meeting technology platform that offers simultaneous content sharing to optimize audience engagement and situational awareness. For more information, visit www.oblong.com and Oblong’s Twitter and Facebook pages.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240822241281/en/

Investor Relations Contact:

David Clark

investors@oblong.com

(213) 683-8863 ext. 5

Source: Oblong, Inc.

FAQ

When will Oblong's (OBLG) reverse stock split take effect?

Oblong's 1-for-40 reverse stock split will become effective at 5:00 PM Eastern Time on August 23, 2024.

What is the new trading date for Oblong's (OBLG) split-adjusted shares?

Oblong's shares will begin trading on a split-adjusted basis on the Nasdaq Capital Market on August 26, 2024.

What is the purpose of Oblong's (OBLG) reverse stock split?

The reverse stock split is intended to increase the per share trading value of Oblong's common stock to satisfy the Nasdaq Capital Market's continued listing standards.

How will Oblong's (OBLG) reverse stock split affect the number of outstanding shares?

The reverse stock split will reduce the number of Oblong's outstanding common shares from approximately 28,242,000 to about 710,000.