Velo3D, Inc. Announces Reverse Stock Split
Velo3D (NYSE: VLD) has announced a 1-for-35 reverse stock split of its common stock, set to begin trading on June 13, 2024, under the existing symbol “VLD”. This decision, approved by the board and stockholders, aims to meet NYSE's minimum share price requirements. Post-split, each shareholder's 35 shares will be consolidated into one share, reducing the total outstanding common shares from approximately 297 million to around 8.5 million. No fractional shares will be issued; any resulting fraction will be rounded up to one share. The par value and authorized shares remain unchanged. Proportional adjustments will apply to stock options, warrants, and equity awards. The transfer agent for the split is Continental Stock Transfer & Trust Company. For more details, refer to the definitive proxy statement filed with the SEC on April 29, 2024.
- The reverse stock split aims to regain compliance with NYSE's minimum share price requirements.
- Post-split, the total number of outstanding shares will reduce from approximately 297 million to around 8.5 million shares.
- No fractional shares will be issued; any fractional shares will be rounded up to one full share.
- Proportional adjustments will be made to the exercise prices of stock options, warrants, and equity awards.
- The authorized shares and par value of the common stock will remain unchanged.
- The reverse stock split was approved by both the board of directors and stockholders.
- The company has filed all necessary amendments with the Secretary of State of Delaware.
- The reverse stock split suggests previous non-compliance with NYSE’s minimum share price requirements.
- The total number of outstanding shares will significantly decrease, which may reflect underlying concerns about stock performance.
- Stockholders may face potential losses due to the consolidation of shares and a perceived decrease in market value.
- There is a potential risk of continued low share prices even after the reverse stock split.
Insights
The approval of a 1-for-35 reverse stock split by Velo3D’s board and shareholders is aimed at regaining compliance with the NYSE’s minimum share price requirement. Such a move is often employed by companies whose share prices have fallen significantly, making them vulnerable to delisting. From a financial perspective, this action will reduce the number of outstanding shares from approximately 297,064,857 to 8,487,567, which theoretically should multiply the share price by 35 times, assuming the market capitalization remains constant.
For retail investors, the immediate implication is a decrease in the number of shares they hold, although the total value of their investments remains unchanged initially. However, the potential for increased share price volatility post-split is something to watch closely. This volatility could either present an opportunity for short-term gains or risks, depending on market sentiment and the company's operational performance post-split.
In the broader market context, a reverse stock split is often seen as a signal of financial distress, although it is not always indicative of future performance. Velo3D’s decision to maintain a high number of authorized shares (500,000,000) despite the split could suggest future plans for capital raising or other strategic moves. Investors should be mindful of this, as it may lead to potential dilution of equity if additional shares are issued down the line.
Moreover, the reaction of institutional investors to this split will be crucial. Positive engagement by large investors post-split could stabilize the stock, while a lack of confidence could lead to further declines. Retail investors should monitor market reactions and institutional investor actions closely to gauge future stock performance.
The procedural aspects, such as filing an amendment to the certificate of incorporation and adjusting the exercise prices of stock options and warrants, are standard in corporate governance during a reverse stock split. Investors need to understand that such adjustments are designed to maintain financial equivalency for existing shareholders and holders of equity-based awards.
It is also noteworthy that the absence of fractional shares, replaced by the issuance of whole shares to cover any fractions, simplifies the process for shareholders. From a legal standpoint, the company's adherence to compliance requirements and transparent communication in their proxy statement and filings with the SEC ensures that shareholders are well-informed and protected under current regulations.
The Company will file an amendment to its certificate of incorporation with the Secretary of
The 1-for-35 reverse stock split will automatically convert 35 current shares of Velo3D’s common stock into one new share of common stock. Fractional shares will not be issued in connection with the reverse stock split. Each stockholder who would otherwise hold a fractional share of common stock as a result of the reverse stock split will receive one share of common stock in lieu of such fractional share. The reverse split will reduce the number of shares of outstanding common stock from approximately 297,064,857 shares to approximately 8,487,567 shares. Proportional adjustments also will be made to the exercise prices of Velo3D’s outstanding stock options and warrants, and to the number of shares issued and issuable under Velo3D’s outstanding equity-based awards.
Continental Stock Transfer & Trust Company (“Continental”) will act as the transfer agent for the reverse stock split. Stockholders holding their shares electronically in book-entry form are not required to take any action to receive post-split shares. Stockholders owning shares through a bank, broker or other nominee will have their positions automatically adjusted to reflect the reverse stock split, subject to brokers’ particular processes, and will not be required to take any action in connection with the reverse stock split.
Additional information concerning the reverse stock split can be found in the Company’s definitive proxy statement on Schedule 14A filed with the SEC on April 29, 2024.
About Velo3D:
Velo3D is a metal 3D printing technology company. 3D printing—also known as additive manufacturing (AM)—has a unique ability to improve the way high-value metal parts are built. However, legacy metal AM has been greatly limited in its capabilities since its invention almost 30 years ago. This has prevented the technology from being used to create the most valuable and impactful parts, restricting its use to specific niches where the limitations were acceptable.
Velo3D has overcome these limitations so engineers can design and print the parts they want. The company’s solution unlocks a wide breadth of design freedom and enables customers in space exploration, aviation, power generation, energy, and semiconductor to innovate the future in their respective industries. Using Velo3D, these customers can now build mission-critical metal parts that were previously impossible to manufacture. The fully integrated solution includes the Flow print preparation software, the Sapphire family of printers, and the Assure quality control system—all of which are powered by Velo3D’s Intelligent Fusion manufacturing process. The company delivered its first Sapphire system in 2018 and has been a strategic partner to innovators such as SpaceX, Honeywell, Honda, Chromalloy, and Lam Research. Velo3D has been named as one of Fast Company’s Most Innovative Companies for 2023. For more information, please visit Velo3D.com, or follow the company on LinkedIn or Twitter.
Forward-Looking Statements:
This press release contains certain forward-looking statements within the meaning of the federal securities laws, including statements concerning expectations regarding the effect of the reverse stock split including its impact on the stock price and continued listing on the NYSE. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release. You should carefully consider the risks and uncertainties described in the “Risk Factors” section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the
Velo, Velo3D, Sapphire, and Intelligent Fusion, are registered trademarks of Velo3D, Inc. Without Compromise, Flow and Assure, are trademarks of Velo3D, Inc.
All Rights Reserved © Velo3D, Inc.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240610095022/en/
Media Contact:
Dan Sorensen, Senior Director of Public Relations
press@velo3d.com
Investor Relations:
Bob Okunski, VP Investor Relations
investors@velo3d.com
Source: Velo3D
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