DM
Desktop Metal, INC
NYSE
DEF 14A: Desktop Metal Seeks Stockholder Approval for Reverse Stock Split to Regain NYSE Compliance
Sentiment:
Proxy Statement
23 April 2024 7:15 AM
Desktop Metal is asking stockholders to approve a reverse stock split to meet NYSE listing requirements and increase the attractiveness of its stock.
Worse than expected
The company needs to implement a reverse stock split to regain compliance with the NYSE minimum bid price requirement, indicating that the share price has fallen below acceptable levels.
Capital raise
The company may offer common and preferred stock, debt securities, warrants, and units of up to $250.0 million in the aggregate under a shelf registration statement.
The company may sell shares of its Class A common stock having aggregate sales proceeds of up to $75.0 million pursuant to an at the market offering program.
The company intends to raise capital through equity or debt financing to fund its current operations.
Summary
- Desktop Metal is holding its Annual Meeting of Stockholders on June 7, 2024, to vote on several proposals.
- Key proposals include the election of three Class I directors, ratification of Deloitte & Touche LLP as the independent accounting firm, and an advisory vote on executive compensation.
- A significant proposal is to approve amendments to the company's certificate of incorporation to effect a reverse stock split of Class A Common Stock at a ratio between 1-for-10 and 1-for-15.
- The reverse stock split aims to regain compliance with the NYSE's minimum bid price requirement and potentially facilitate future capital raising.
- Stockholders will also vote on a proposal to adjourn the Annual Meeting, if necessary, to solicit additional proxies for the reverse stock split proposal.
- As of April 10, 2024, there were 330,172,511 shares of Class A common stock outstanding and entitled to vote.
Sentiment
Score: 5
Explanation: The document presents a mixed sentiment. While the company is taking proactive steps to address its stock price and ensure future financial flexibility, the need for a reverse stock split and potential capital raising suggests underlying challenges.
Positives
- Regaining compliance with NYSE listing requirements can enhance investor confidence.
- A higher stock price may attract a broader range of institutional investors.
- The reverse stock split could facilitate future capital raising efforts.
- Maintaining the NYSE listing can help attract, retain, and motivate employees and board members.
Negatives
- There is no guarantee that the reverse stock split will result in a sustained increase in the stock price.
- The reverse stock split may negatively impact the market price of the common stock.
- Delisting from the NYSE could significantly reduce the liquidity of the Class A common stock.
- The reverse stock split may increase the number of stockholders who own odd lots, leading to higher transaction costs.
Risks
- The reverse stock split may not result in a sustained increase in the per share price of the Class A common stock.
- The company may not be able to continue to satisfy the NYSE's additional requirements for continued listing.
- Liquidity could be adversely affected by the reduced number of shares outstanding after the reverse stock split.
- Failure to raise additional capital through equity or debt financing would have a material adverse effect on the company's ability to meet its long-term liquidity needs and achieve its business objectives.
Future Outlook
The company intends to raise capital through equity or debt financing to fund its current operations, but there is no assurance that such financing will be available on acceptable terms.
Industry Context
The document does not explicitly discuss broader industry trends, but the reverse stock split indicates potential challenges in maintaining stock value within the competitive 3D printing market.
Comparison to Industry Standards
- The document mentions peer companies such as 3D Systems Corporation, Markforged Holding Corporation, Stratasys Ltd., and Velo3D, Inc.
- These companies are used for benchmarking executive compensation and represent a mix of relevant industries and business models.
- The document does not provide a detailed comparison of Desktop Metal's financial performance against these companies.
Stakeholder Impact
- The reverse stock split will impact shareholders by reducing the number of outstanding shares and potentially increasing the stock price.
- Employees and directors compensated with equity-based securities may be affected by the reverse stock split and the company's ability to maintain its NYSE listing.
- The company's ability to raise capital will impact its ability to meet its long-term liquidity needs and achieve its business objectives.
Next Steps
- Stockholders will vote on the proposals at the Annual Meeting on June 7, 2024.
- The Board of Directors will determine whether and when to effect the reverse stock split based on market conditions and other factors.
- The company will announce the results of the Annual Meeting in a Current Report on Form 8-K.
Key Dates
- April 10, 2024: Record Date for the Annual Meeting
- April 23, 2024: Approximate date of mailing the Notice of Internet Availability of Proxy Materials
- June 6, 2024: Deadline for voting via Internet or telephone (11:59 p.m. Eastern Time)
- June 7, 2024: Annual Meeting of Stockholders at 9:00 a.m. Eastern Time
- December 31, 2024: Fiscal year ending date for which Deloitte & Touche LLP is appointed as independent registered public accounting firm
- December 24, 2024: Deadline for stockholders to submit proposals for inclusion in the 2025 proxy materials
- February 7, 2025: Earliest date for stockholders to submit proposals for presentation at the 2025 Annual Meeting of Stockholders
- March 9, 2025: Latest date for stockholders to submit proposals for presentation at the 2025 Annual Meeting of Stockholders
- April 8, 2025: Deadline for stockholders to provide notice of intent to solicit proxies in support of director nominees for the 2025 Annual Meeting of Stockholders
Keywords
reverse stock split, annual meeting, proxy statement, NYSE compliance, stockholders, directors, executive compensation, Deloitte & Touche, capital raising, Class A common stock
DM
Desktop Metal, INC
NYSE
Sector: TBD
Filings with Classifications
Worse than expected
26 March 2025 5:20 PM
8-K Filing
- Revenue decreased from $189.7 million to $148.8 million year-over-year.
Worse than expected
31 October 2024 7:00 AM
Quarterly Report
- The company's revenue decreased by 15% year-over-year.
- The company reported a net loss of $35.4 million for the quarter and $191.0 million for the first nine months.
- The company's gross margin, while improved, is still relatively low at 9%.
Capital raise
31 October 2024 7:00 AM
Quarterly Report
- The company may need to raise additional capital through arrangements with Nano or from other sources, including equity and debt financings.
- The company has a multi-draw term loan credit facility with Nano for up to $20 million, available after January 7, 2025.
- The company may need to issue additional shares of capital stock or offer debt or other equity securities if the merger is not completed.
Worse than expected
23 September 2024 4:24 PM
Proxy Statement
- The company warns of potential dilutive financings or bankruptcy if the merger fails.
- Desktop Metal expects to run out of cash by the end of the first quarter of 2025 if the merger is not approved.
Capital raise
13 September 2024 4:02 PM
Proxy Statement
- The document mentions that if the merger is not approved, Desktop Metal may need to undertake financings.
- These financings may be severely dilutive to stockholders.
Worse than expected
13 September 2024 4:02 PM
Proxy Statement
- The company expects to run out of cash by the end of the first quarter 2025 if the merger is not approved.
- The company may need to undertake financings that may be severely dilutive to stockholders if the merger is not approved.
- There is a risk of bankruptcy if the merger is not approved.
Worse than expected
6 September 2024 4:38 PM
Proxy Statement
- Desktop Metal expects to run out of cash by the end of the first quarter of 2025 if the merger is not approved.
Capital raise
15 August 2024 7:00 AM
Definitive Proxy Statement
- The merger agreement includes a provision for a multi-draw term loan credit facility (Bridge Loan Facility) from Nano to Desktop Metal, up to $20 million, to provide working capital and liquidity.
Worse than expected
31 July 2024 4:15 PM
Earnings Conference Call Transcript
- The company's Q2 2024 revenue was down compared to the previous year.
- The company's non-GAAP gross margins were down compared to the previous year.
- The company's adjusted EBITDA was negative.
Worse than expected
30 July 2024 4:53 PM
Quarterly Report
- The company's revenue decreased by 27% compared to the same quarter last year.
- The company's gross margin was -83%, indicating significant losses on sales.
- The company's net loss increased significantly compared to the same quarter last year.
Capital raise
30 July 2024 4:53 PM
Quarterly Report
- The company plans to raise additional capital through a combination of potential options, including equity and debt financings.
- Nano Dimension agreed to provide a multi-draw term loan credit facility in an aggregate principal amount not to exceed $20.0 million, subject to certain conditions.
Worse than expected
30 July 2024 4:36 PM
Quarterly Report
- Revenue decreased from $53.3 million to $38.9 million compared to the same quarter last year.
- The company reported a net loss of $(103.4) million.
Worse than expected
30 July 2024 4:35 PM
Quarterly Report
- The company's revenue decreased significantly year-over-year.
- The company reported a substantial net loss, primarily due to one-time non-cash charges.
- The company's GAAP gross margin was negative, indicating poor profitability.
Delay expected
3 July 2024 4:24 PM
Merger Announcement
- The transaction is expected to close at the end of the year, but based on delays, maybe a few months later.
Worse than expected
3 July 2024 4:24 PM
Merger Announcement
- The combined company expects negative cash flow for the next six to eight quarters.
Delay expected
3 July 2024 7:32 AM
Merger Announcement
- The closing of the transaction is expected in the fourth quarter of 2024, but is subject to customary closing conditions, including regulatory approvals, which could cause delays.
Worse than expected
3 July 2024 7:32 AM
Merger Announcement
- The final purchase price is subject to downward adjustments based on transaction expenses and potential draws on a loan facility, which could reduce the value of the deal for Desktop Metal shareholders.
Capital raise
3 July 2024 7:32 AM
Merger Announcement
- Nano Dimension has committed to providing Desktop Metal with a $20 million secured loan facility if the closing of the transaction extends into 2025.
- The purchase price may be adjusted based on the amount drawn from the loan facility prior to closing.
Worse than expected
9 May 2024 6:02 AM
Quarterly Report
- The company's revenue decreased by 2% year-over-year, indicating worse than expected sales performance.
- The company reported a gross loss of $2.2 million, indicating worse than expected profitability.
- The company's net loss of $52.1 million was significant, indicating worse than expected financial results.
Capital raise
9 May 2024 6:02 AM
Quarterly Report
- The company entered into an Open Market Sale Agreement with Cantor Fitzgerald & Co. to sell shares of common stock for an aggregate offering price of up to $75.0 million.
- The company may need to further increase its capital resources by issuing additional shares of its capital stock or offering debt or other equity securities.
Better than expected
9 May 2024 6:00 AM
Quarterly Report
- The company's adjusted EBITDA improved by 44% year-over-year, indicating better than expected cost management.
- Non-GAAP operating expenses decreased for nine consecutive quarters, showing better than expected cost control.
- Cash consumption decreased by 47% year-over-year, demonstrating better than expected cash management.
Capital raise
23 April 2024 7:15 AM
Proxy Statement
- The company may offer common and preferred stock, debt securities, warrants, and units of up to $250.0 million in the aggregate under a shelf registration statement.
- The company may sell shares of its Class A common stock having aggregate sales proceeds of up to $75.0 million pursuant to an at the market offering program.
- The company intends to raise capital through equity or debt financing to fund its current operations.
Worse than expected
23 April 2024 7:15 AM
Proxy Statement
- The company needs to implement a reverse stock split to regain compliance with the NYSE minimum bid price requirement, indicating that the share price has fallen below acceptable levels.
Capital raise
15 March 2024 4:12 PM
Annual Results
- The company may need to further increase its capital resources by issuing additional shares of its capital stock or offering debt or other equity securities.
- The company may not be able to obtain additional financing on terms favorable to it, if at all.
Worse than expected
15 March 2024 4:12 PM
Annual Results
- The company experienced a net loss of $323.3 million in 2023, which is worse than the previous year.
- The company's revenue decreased by 9% in 2023 compared to 2022.
- The company's gross profit decreased by $25.2 million in 2023 compared to 2022.
Better than expected
15 March 2024 7:00 AM
Quarterly Report
- The company's net loss significantly decreased year-over-year, indicating improved financial performance.
- Adjusted EBITDA showed a substantial improvement, reaching the company's strongest quarterly performance to date.
- Non-GAAP gross margins improved significantly year-over-year.
Worse than expected
24 January 2024 8:05 AM
Strategic Business Review
- The company is implementing a significant workforce reduction and restructuring plan, indicating that the current financial performance is worse than expected.
- The company is facing a downturn in the additive manufacturing industry and a softer demand environment, which are contributing to the need for these cost-cutting measures.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.