PROPOSAL NO. 1
REVERSE STOCK SPLITWARRANT REPRICING PROPOSAL
General
Momentus is asking stockholders to authorize our Boardapprove, in accordance with Nasdaq Listing Rule 5635(d), the repricing of certain existing warrants of the Company (the “Warrant Repricing Proposal”). As previously disclosed, on January 17, 2024, we closed a transaction with an institutional investor as the purchaser (the “Investor”) in which we sold, and the Investor purchased, in a registered direct offering (i) an aggregate of 900,000 shares of the Company’s Class A common stock, at a purchase price of $1.085 per share of Class A common stock and one January 2024 Warrant (as defined below), (ii) in lieu of Class A common stock, at the election of the Investor, pre-funded warrants to amend our Second Amendedpurchase 2,787,000 shares of Class A common stock, at a purchase price of $1.08499 per pre-funded warrant, and Restated Certificate(iii) warrants to purchase 3,687,000 shares of IncorporationClass A common stock (the “January 2024 Warrants”), pursuant to effectthe terms of a reverseSecurities Purchase Agreement (the “Securities Purchase Agreement”) that we entered into with the Investor.
Additionally, the Securities Purchase Agreement provides for a warrant repricing transaction (the “Warrant Repricing Transaction”) with respect to warrants to purchase up to 5,808,538 shares of the Company’s Class A common stock splitinitially issued by the Company to the Investor on November 9, 2023 (the “November 2023 Warrants”). The Securities Purchase Agreement requires the Company, among its other obligations, to hold a meeting of our outstandingstockholders by April 16, 2024 to request stockholder approval of the Warrant Repricing Transaction (the “Stockholder Approval”) for a reduction of the exercise price from $3.862 per share to $0.96 per share and an extension of the termination date of the November 2023 Warrants to five years following the date on which the Company receives the Stockholder Approval.
If the Stockholder Approval is not obtained at the Special Meeting, then the Company will be required to call another meeting of stockholders every sixty days thereafter to seek the Stockholder Approval until the earlier of the date Stockholder Approval is achieved and May 9, 2024, which is the date that is six months after the November 9, 2023 issuance date of the November 2023 Warrants. If Stockholder Approval is not obtained by May 9, 2024, then automatically and without any approval of stockholders (i) the exercise price of the November 2023 Warrants will be reduced (if and only if such new exercise price on the repricing date is lower than the exercise price of the November 2023 Warrants then in effect) to be the Minimum Price (as defined below) of the Class A Stock on May 9, 2024, and (ii) the termination date of the November 2023 Warrants will be extended to May 9, 2029.
The November 2023 Warrants and the January 2024 Warrants both provide that the Investor will not have the right to exercise any portion of such warrants if the exercise would cause (i) the aggregate number of shares of our Class A common stock (the “Class A common stock” orbeneficially owned by the “common stock”),Investor (together with its affiliates) to exceed 4.99% (or, at a reverse stock split ratio in the range of 1-for-[•] through 1-for-[•], as determined by our Board at a later date (the “Reverse Stock Split”). [Our Board has approved seeking stockholder authorization for the Board to effect the proposed amendment and recommends that our stockholders adopt and approve the proposal.] The following descriptionelection of the proposed amendment is a summary and is subject to the full textInvestor, 9.99%) of the proposed amendment, which is attached to this Proxy Statement as Annex A.
If stockholders approve this proposal, the Board will cause the Certificatenumber of Amendment to be filed with the Delaware Secretary of State and effect the Reverse Stock Split only if the Board determines that the Reverse Stock Split would be in the best interests of Momentus and its stockholders at that time. The Reverse Stock Split could become effective as soon as the business day immediately following the Special Meeting. The Board also may determine in its discretion not to effect the Reverse Stock Split and not to file the Certificate of Amendment. No further action on the part of stockholders will be required for the Board to either implement or abandon the Reverse Stock Split.
The proposed amendment, if effected, will effect a Reverse Stock Split of the outstanding shares of Momentus’ common stock at a reverse stock split ratio in the range of 1-for-[•] through 1-for-[•] (the “Ratio Range”), as determined by our Board at a later date. As of the Record Date, [•] shares of our Class A common stock were issued and outstanding. Based on such number of shares of our common stock issued and outstanding immediately following the effectiveness of the Reverse Stock Split (and withoutafter giving effect to roundingthe exercise, or (ii) the combined voting power of the Company’s securities beneficially owned by the Investor (together with its affiliates) to exceed 4.99% (or, at the election of the Investor, 9.99%) of the combined voting power of all of the Company’s securities then outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the warrants.
Nasdaq Stockholder Approval Requirement
Listing Rule 5635(d) requires stockholder approval in connection with a transaction, other than a public offering, involving the sale or issuance by the issuer of Common Stock (or securities convertible into or exchangeable for fractional shares), weCommon Stock) equal to 20% or more of the Common Stock or 20% or more of the voting power of such company outstanding before the issuance for a price that is less than the lower of: (i) the closing price of the Common Stock immediately preceding the signing of the binding agreement for the issuance of such securities and (ii) the average closing price of the Common Stock for the five trading days immediately preceding the signing of the binding agreement for the issuance of such securities (the “Minimum Price” as provided in Nasdaq Listing Rule 5635(d)).