At the same shareholder meeting, it sought permission to increase its number of shares outstanding from 500 million to 5 billion. So, Helios and Matheson announced that it wanted permission to do a reverse split, offering a range of possible split ratios of between one new share for every two old ones to one new share for every 250 old ones. After the company's stock spent 30 days trading for pennies, the Nasdaq sent Helios and Matheson a warning letter that it faced delisting if it didn't get its shares above the $1 threshold on a sustained basis. After that, it fell in fits and starts as the company's losses ballooned, thanks to the growing number of consumers taking advantage of MoviePass's all-you-can-eat $10 movie ticket subscription plan, and as it flooded the market with new shares, which it sold to replenish the cash it was rapidly burning through.īy May, Helios and Matheson's stock had fallen below $1 a share. Helios and Matheson's stock price peaked in October 2017 at nearly $39 a share - or $9,715 a share if you take into account the effect of the reverse split. Indeed, it's what led directly to Helios and Matheson being in the position it's in today, risking delisting. It also resembles the actual reverse split the company actually effected in July - and the results of that weren't good. Because this effort to do a reverse split doesn't just call to mind last fall's aborted effort to do the same thing. That "near term" line is important to note. The company already reverse split its stock in July "We believe that a reverse stock split could increase the market price of our common stock sufficient to satisfy minimum bid price requirement in the near term," the company said in the statement. Read this: MoviePass's parent company is in dire danger of having its stock delisted by the Nasdaq But its appeal will be heard by the Nasdaq on January 31, and it needs to be able to show regulators that it has a plan to get its stock price back above the $1 threshold. The company appealed that decision, it confirmed in the regulatory document. The Nasdaq national market warned the company last month that it planned to delist Helios and Matheson's stock for failing to meet its $1-a-share price requirement. Helios and Matheson officials are pressing the plan again, because they feel they have to. It first pitched a similar plan in September, then twice delayed holding a vote on it before withdrawing the plan amid objections from investors. The company hasn't set a date for the meeting, but even it acknowledged that this effort sounds like déjà vu. Helios and Matheson's "board has unanimously adopted a resolution authorizing, approving, declaring advisable and recommending to the company’s stockholders for their approval an amendment to the company’s certificate of incorporation to effect a reverse split of the outstanding and treasury shares of the company’s common stock in a ratio of 1 share-for-2 shares up to a ratio of 1 share-for-500 shares," the company said in a document filed with the Securities and Exchange Commission. And you'll never guess what it wants investors to approve. Indeed, in a regulatory filing, the company said it expected investors would vote down the proposal.īut late on Friday, the company announced new plans to hold a special shareholder meeting. The company backed away from the effort because shareholders were openly hostile to the plan. Two months ago, Helios and Matheson - MoviePass's parent company - cancelled a special shareholder meeting at which it hoped to get investor approval to reverse split its stock. You've got to give the folks who run MoviePass credit for at least two things: They're persistent. Even after massively diluting shareholders, the company is alerting investors that it likely would issue new shares after a split to raise funds to continue its operations.Just as with that plan, the new proposal would give the company room to issue billions of new shares.The proposal is basically the same one that the company withdrew in November in the face of widespread investor opposition.The company is in imminent danger of having its stock delisted from the Nasdaq the market is hearing the company's appeal of its delisting decision later this month.MoviePass parent Helios and Matheson on Friday said it would seek - again - to get shareholder authorization to reverse split its stock.Account icon An icon in the shape of a person's head and shoulders.
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