SCHEDULE 13D/A: Matinas BioPharma Holdings Amends 13D Filing, Details Increased Stake and Ownership Caps for Key Investors

Matinas BioPharma Holdings, Inc. has filed an amendment to its Schedule 13D, detailing the second closing of a private placement that significantly increases the potential beneficial ownership of Pembroke & Partners LLC and Robert J. Eide, subject to a 9.99% beneficial ownership cap.

Summary

• Matinas BioPharma Holdings, Inc. filed Amendment No. 1 to its Schedule 13D, updating beneficial ownership information following a 'Second Closing' of a purchase agreement.
• At the Second Closing on April 8, 2025, Pembroke & Partners LLC purchased 492 shares of Preferred Stock (convertible into up to 839,591 shares of Common Stock) and Warrants (exercisable for up to 1,679,182 shares of Common Stock) for a total consideration of $492,000.
• The Issuer (Matinas BioPharma) issued and sold a total of 1,650 shares of Preferred Stock (convertible into up to 2,815,702 shares of Common Stock) and accompanying Warrants (exercisable for up to 5,631,404 shares of Common Stock) for gross proceeds of $1.65 million at the Second Closing.
• Shareholder approval for the issuance of Preferred Stock and Warrants was obtained on April 4, 2025, as per NYSE American rules.
• The Warrants became exercisable on April 8, 2025, at an exercise price of $0.6446 per share (110% of the Conversion Price) and will expire on April 8, 2030.
• The 19.99% beneficial ownership limit was lifted from April 4, 2025, but a new 'Beneficial Ownership Cap' of 9.99% of outstanding Common Stock applies to the Reporting Persons (Pembroke & Eide) and their group (Sanitam Group and Mr. Stern) upon conversion/exercise.
• Pembroke & Partners LLC beneficially owns 984 shares of Preferred Stock (equaling 1,679,182 Common Stock as-converted) and Warrants (equaling 3,358,364 Common Stock as-exercised), totaling 5,037,546 Common Stock, subject to the 9.99% cap.
• Pembroke's voting power, based on its Preferred Stock, is 1,539,906 shares of Common Stock or 23% of the outstanding Common Stock on an as-converted basis.
• Robert J. Eide, as sole manager of Pembroke, is deemed to beneficially own the same securities as Pembroke, subject to the cap, plus 1,500 shares of Common Stock directly/indirectly owned.
• The Sanitam Group and Mr. Stern collectively beneficially own 2,316 shares of Preferred Stock and 7,904,444 Warrants, totaling 11,856,666 Common Stock (subject to the 9.99% cap), and their combined voting power from Preferred Stock is 5,164,319 shares of Common Stock or 50.3% of outstanding Common Stock on an as-converted basis (with Reporting Persons).

Sentiment

Score: 6

Explanation: The sentiment is moderately positive. The company successfully completed a capital raise, which is generally favorable for operations and stability. However, the complexity of the beneficial ownership caps and the inherent dilution from new share issuance temper the overall positive impact.

Positives

• The company successfully completed the 'Second Closing' of its purchase agreement, securing an additional $1.65 million in gross proceeds.
• Shareholder approval was obtained for the issuance of Preferred Stock and Warrants, indicating investor support for the capital structure changes.
• The lifting of the 19.99% limit provides flexibility for future capital actions, although subject to new caps.

Negatives

• The complex beneficial ownership caps (9.99% aggregate, 9.99% for Preferred Stock conversion, 4.99% for Warrants exercise for Pembroke) introduce complexity and limit the immediate full conversion/exercise of the securities.
• The significant potential beneficial ownership (up to 76.9% of outstanding Common Stock if fully converted/exercised without caps) could lead to substantial dilution if the caps were ever removed.

Risks

• The Beneficial Ownership Cap of 9.99% limits the Reporting Persons' and their group's ability to fully convert Preferred Stock and exercise Warrants into Common Stock, potentially impacting liquidity or control.
• Individual beneficial ownership limits (9.99% for Preferred Stock conversion, 4.99% for Warrants exercise for Pembroke) further restrict the immediate conversion/exercise of securities.
• Future changes to the Beneficial Ownership Cap or the issuance of additional shares could impact the ownership percentage and voting power of existing shareholders.

Future Outlook

The Warrants issued in this transaction are exercisable until April 8, 2030, indicating a long-term investment horizon for these securities. The lifting of the 19.99% beneficial ownership limit, while replaced by a 9.99% cap, suggests a potential for continued strategic investment or influence by the reporting persons and their group, albeit within defined limits.

Industry Context

This filing details a specific capital raise and ownership structure adjustment for Matinas BioPharma Holdings, Inc. It reflects a company's efforts to secure financing and manage its investor base, which is a common activity in the biotechnology and pharmaceutical sectors, particularly for companies in development stages.

Corporate Governance

Stakeholder Impact

• Shareholders: Potential for dilution from the issuance of new shares, but also benefit from the capital infusion. Voting power dynamics are shifted due to the Preferred Stock's as-converted voting rights and the beneficial ownership caps.
• Company: Receives additional capital ($1.65 million gross proceeds) to support operations and strategic initiatives.
• Investors (Pembroke, Eide, Sanitam Group, Stern): Increase their potential beneficial ownership and voting influence, albeit subject to significant caps that limit immediate full conversion/exercise.

Next Steps

• The Preferred Stock is convertible at the option of the Reporting Person.
• The Warrants are exercisable at the stated exercise price until April 8, 2030.
• The Reporting Persons may increase their 4.99% beneficial ownership limit on Warrants exercise to 9.99% upon 61 days' notice.

Key Dates

Keywords

Matinas BioPharma Holdings, MBRX, Schedule 13D, SEC filing, beneficial ownership, private placement, preferred stock, warrants, capital raise, corporate governance, equity financing, investor relations