8-K: Better Choice Company Announces 1-for-44 Reverse Stock Split to Regain NYSE American Compliance

Better Choice Company will implement a 1-for-44 reverse stock split effective March 20, 2024, to regain compliance with NYSE American listing standards.

Summary

• Better Choice Company, Inc. has announced a 1-for-44 reverse stock split of its common stock.
• The reverse stock split was authorized by the Board of Directors and majority shareholders.
• The reverse split will be effective on March 20, 2024, and will begin trading on a post-split basis on March 21, 2024.
• The company's CUSIP number will change to 08771Y 402 in conjunction with the reverse split.
• The par value of the company's common stock will remain at $0.001.
• The reverse split will not affect any stockholder's ownership percentage, except for adjustments due to fractional shares.
• No fractional shares will be issued; instead, the company will issue one whole share to any stockholder who would have received a fractional share.
• The company received a notice from the NYSE American that it is not in compliance with continued listing standards due to a low share price.
• The reverse stock split is intended to help the company regain compliance with the NYSE American's listing standards.

Sentiment

Score: 5

Explanation: The sentiment is neutral. While the reverse stock split is a necessary step to maintain listing, it also highlights the company's struggle with its stock price. The action is expected and does not indicate a positive or negative shift in the company's fundamentals.

Positives

• The reverse stock split is a proactive measure to address the company's non-compliance with NYSE American listing standards.
• The company is taking steps to ensure continued listing on the NYSE American.
• The reverse stock split will not change the ownership percentage of existing shareholders, except for minor adjustments due to fractional shares.
• The company will issue whole shares in place of fractional shares, ensuring no shareholder loses out.

Negatives

• The company was notified by the NYSE American that it is not in compliance with continued listing standards due to a low share price.
• The reverse stock split is a result of the company's stock price falling below the required minimum for continued listing.

Risks

• The company's continued listing on the NYSE American is contingent on the success of the reverse stock split or other measures to improve the stock price.
• There is a risk that the reverse stock split may not be sufficient to regain compliance with the NYSE American listing standards.
• The company's stock price may continue to be volatile.

Future Outlook

The company intends to seek to regain compliance with the NYSE American's continued listing standards by undertaking this reverse stock split.

Management Comments

• The company considers the reverse stock split necessary and in the best interests of the company and its shareholders.

Industry Context

Reverse stock splits are often used by companies to increase their stock price and avoid delisting from exchanges. This action is not uncommon for companies facing compliance issues with exchange listing requirements.

Comparison to Industry Standards

• Reverse stock splits are a common mechanism for companies facing delisting from exchanges due to low share prices.
• Other companies in similar situations, such as those in the biotech or small-cap sectors, have also used reverse stock splits to regain compliance.
• The specific ratio of 1-for-44 is within the typical range for reverse stock splits, which can vary widely depending on the company's specific circumstances.

Stakeholder Impact

• Shareholders will see a reduction in the number of shares they own, but their ownership percentage will remain the same, except for minor adjustments due to fractional shares.
• The reverse stock split is intended to benefit shareholders by helping the company maintain its listing on the NYSE American.
• The company's employees may be impacted by the company's overall performance and stock price.

Next Steps

• The company will implement the 1-for-44 reverse stock split on March 20, 2024.
• Trading on a post-split basis will begin on March 21, 2024.
• The company will work with its transfer agent to exchange old stock certificates for new ones for shareholders who hold physical certificates.
• The company will monitor its stock price to ensure compliance with NYSE American listing standards.

Key Dates

Keywords

reverse stock split, NYSE American, listing standards, stock compliance, BTTR, shareholders, stock price