Urgent.ly Inc. Announces Reverse Stock Split to Regain Nasdaq Compliance

Rhea-AI Summary

Urgent.ly Inc. (Nasdaq: ULY) has announced a 1-for-12 reverse stock split effective March 17, 2025, to regain compliance with Nasdaq's minimum $1.00 bid price requirement. The company's stock will begin trading on a split-adjusted basis on March 18, 2025, under the same ticker 'ULY'.

The reverse split was approved by stockholders on March 12, 2025. Key changes include:

• Total authorized shares reduced from 1 billion to 500 million
• Preferred stock remains at 100 million shares
• Common stock par value unchanged at $0.001 per share
• Fractional shares will be paid in cash based on pre-split closing price

Proportional adjustments will be made to outstanding warrants, stock options, restricted stock units, and equity incentive plans. Equiniti Trust Company will serve as the exchange agent, with registered stockholders not required to take action for book-entry shares.

Positive

• Action helps maintain Nasdaq listing status
• No change to company's market capitalization
• Stockholder approval already secured for the reverse split

Negative

• Company forced to implement reverse split due to non-compliance with Nasdaq listing requirements
• Indicates previous significant stock price decline below $1.00
• Reduction in total number of outstanding shares could impact stock liquidity

Insights

Financial Analyst

Urgent.ly's 1-for-12 reverse stock split represents a compliance-driven financial maneuver rather than a fundamental business improvement. With shares trading at $0.5096, this action will mathematically increase the share price to approximately $6.12 post-split, enabling the company to meet Nasdaq's $1.00 minimum bid requirement.

The mechanics are straightforward: every 12 shares will consolidate into 1 share effective March 17, while the total market capitalization remains unchanged at approximately $7.1 million. This purely technical adjustment preserves Nasdaq listing but signals underlying challenges that depressed the share price initially.

Maintaining Nasdaq listing provides critical benefits including enhanced liquidity, broader institutional access, and reduced trading restrictions. However, reverse splits typically carry negative market perception as they're associated with distressed companies. The simultaneous reduction in authorized shares from 1 billion to 500 million suggests management is being realistic about future capital needs.

For existing shareholders, positions will be proportionally adjusted with fractional shares paid in cash. While this action prevents immediate delisting, investors should focus on whether Urgent.ly can address the fundamental business challenges that necessitated this financial engineering in the first place.

Corporate Finance Specialist

This reverse split represents a double-edged governance decision for Urgent.ly. While technically maintaining Nasdaq compliance, the 1-for-12 ratio selected is relatively steep compared to typical 1-for-5 or 1-for-10 ratios, indicating significant downward price pressure needed correction.

The timing is noteworthy - by waiting until near the compliance deadline, management has demonstrated they explored alternative strategies before implementing this somewhat cosmetic solution. The halving of authorized shares from 1 billion to 500 million while maintaining all 100 million preferred shares suggests a balanced approach to capital structure management.

Post-split trading dynamics bear watching. Reverse splits typically generate short-term volatility as mechanical adjustments occur across portfolios. With a post-split price projected around $6.12, Urgent.ly gains breathing room above the compliance threshold, but must now demonstrate fundamental performance improvements to maintain this level.

This action effectively resets Urgent.ly's compliance clock but provides no enhancement to core operations, cash flow, or competitive positioning. The real challenge remains strengthening the business fundamentals that will ultimately determine whether this financial engineering proves merely a temporary reprieve or a platform for sustainable valuation recovery.

VIENNA, Va., March 13, 2025 (GLOBE NEWSWIRE) -- Urgent.ly Inc. (Nasdaq: ULY) (“Urgently”), a U.S.-based leading provider of digital roadside and mobility assistance technology and services, announced today that it will effect a reverse stock split of its common stock (including special voting common stock) at a reverse stock split ratio of 1-for-12, effective as of the close of trading on March 17, 2025 (the “Effective Time”), in order to regain compliance with the minimum $1.00 bid price per share requirement of Nasdaq’s Marketplace Rule 5550(a)(2). Urgently’s common stock is expected to begin trading on a reverse-split-adjusted basis on Nasdaq as of the open of trading on March 18, 2025 under the existing ticker symbol “ULY.”

Urgently’s stockholders approved the reverse stock split and granted Urgently’s board of directors the authority to determine the final reverse stock split ratio and when to proceed with the reverse stock split at a Special Meeting of Stockholders held on March 12, 2025. Urgently has filed an amendment to its Amended and Restated Certificate of Incorporation to effect the reverse stock split at the ratio of 1-for-12 as of the Effective Time.

The CUSIP number for Urgently’s common stock will change to 916931207 following the reverse stock split.

As of the Effective Time, every 12 shares of Urgently’s issued and outstanding common stock will be combined into one issued and outstanding share of common stock. The total number of authorized shares of common stock will be reduced from 1,000,000,000 to 500,000,000. The number of authorized shares of preferred stock will remain unchanged at 100,000,000 shares, and the par value of Urgently’s common stock (including special voting common stock) will remain unchanged at $0.001 per share. Any fractional shares of common stock that would otherwise be issuable as a result of the reverse stock split will be paid out in cash, with reference to the closing trading price of Urgently’s common stock on the trading day immediately preceding the Effective Time (as adjusted to give effect to the reverse stock split), without interest.

As of the Effective Time, proportional adjustments will also be made to the number of shares of common stock issuable upon the exercise of Urgently’s outstanding warrants and stock options and the number of shares issuable pursuant to outstanding restricted stock units, and the number of shares authorized and reserved for issuance pursuant to Urgently’s equity incentive and employee stock purchase plans. The exercise prices and stock price targets of outstanding stock options, warrants, and equity awards will also be proportionately adjusted, where applicable.

Urgently’s transfer agent, Equiniti Trust Company, LLC, will serve as the exchange agent for the reverse stock split. Registered stockholders holding pre-reverse-split shares of Urgently’s common stock electronically in book-entry form are not required to take any action to receive post-reverse-split shares. Those stockholders who hold their shares in brokerage accounts or in “street name” who have any questions are encouraged to contact their bank, broker or other nominee.

Additional information about the reverse stock split can be found in Urgently’s definitive proxy statement filed with the Securities and Exchange Commission on February 21, 2025, a copy of which is available at www.sec.gov.

About Urgently

Urgently is focused on helping everyone move safely, without disruption, by safeguarding drivers, promptly assisting their journey, and employing technology to proactively avert possible issues. The company’s digitally native software platform combines location-based services, real-time data, AI and machine-to-machine communication to power roadside assistance solutions for leading brands across automotive, insurance, telematics and other transportation-focused verticals. Urgently fulfills the demand for connected roadside assistance services, enabling its partners to deliver exceptional user experiences that drive high customer satisfaction and loyalty, by delivering innovative, transparent and exceptional connected mobility assistance experiences on a global scale. For more information, visit www.geturgently.com.

For media and investment inquiries, please contact:

Press: media@geturgently.com 

Investor Relations: investorrelations@geturgently.com 

Forward-Looking Statements

This press release contains or may contain “forward-looking statements” within the meaning of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, which statements involve substantial risks and uncertainties. Forward-looking statements include statements regarding the future effective date and intended effects of the reverse stock split, including whether the reverse stock split will increase the price, marketability, liquidity, and investor appeal of Urgently’s common stock and Urgently’s ability to maintain the listing of its common stock on Nasdaq. Such statements are based upon current plans, estimates and expectations of management of Urgently in light of historical results and trends, current conditions and potential future developments, and are subject to various risks and uncertainties that could cause actual results to differ materially from such statements. The inclusion of forward-looking statements should not be regarded as a representation that such plans, estimates and expectations will be achieved. Forward-looking terms such as “may,” “will,” “could,” “should,” “would,” “plan,” “potential,” “intend,” “anticipate,” “project,” “predict,” “target,” “believe,” “continue,” “estimate” or “expect” or the negative of these words or other words, terms and phrases of similar nature are often intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. All statements, other than historical facts, are based on the current assumptions of Urgently’s management and are neither promises nor guarantees, but involve a significant number of factors that may cause Urgently’s actual performance or achievements to be materially different from any future performance or achievements stated or implied by the forward-looking statements. Factors that could cause actual results to differ materially from the forward-looking statements in this press release include but are not limited to the risk that the reverse stock split may impact Urgently’s results of operations, business operations and reputation with or ability to serve its stockholders and/or customers, and the trading prices and volatility of Urgently’s common stock, and other risks and uncertainties detailed in our filings with the Securities and Exchange Commission (“SEC”), including in Urgently’s annual report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on March 29, 2024, and Urgently’s subsequent quarterly reports on Form 10-Q, and other filings and reports that Urgently has field or may file from time to time with the SEC. All forward-looking statements reflect Urgently’s beliefs and assumptions only as of the date of this press release. Urgently undertakes no obligation to update forward-looking statements to reflect future events or circumstances.

FAQ

What is the ratio of Urgent.ly's (ULY) reverse stock split announced in March 2025?

Urgent.ly announced a 1-for-12 reverse stock split, meaning every 12 shares will be combined into one share.

When will ULY's reverse stock split take effect?

The reverse stock split will take effect at market close on March 17, 2025, with split-adjusted trading beginning March 18, 2025.

Why is Urgent.ly (ULY) implementing a reverse stock split?

To regain compliance with Nasdaq's minimum $1.00 bid price requirement under Marketplace Rule 5550(a)(2).

How will ULY's reverse split affect the number of authorized shares?

The total authorized shares will be reduced from 1 billion to 500 million, while preferred stock remains at 100 million shares.

What happens to fractional shares after ULY's reverse split?

Fractional shares will be paid out in cash based on the closing price on the trading day before the split.