MIAMI, Nov. 09, 2022 (GLOBE NEWSWIRE) — Motorsport Games Inc. (NASDAQ: MSGM) announced today that the 1-for-10 reverse stock split of the Company’s Class A and Class B common stock will become effective as of 12:01 a.m. EST on November 10, 2022.
Motorsport Games is effecting the reverse stock split by filing a charter amendment with the Delaware Secretary of State. The reverse stock split was previously approved by the Company’s Board of Directors and stockholders pursuant to Sections 228 and 242 of the Delaware General Corporation Law.
The Company’s Class A common stock will begin trading on the NASDAQ on a split-adjusted basis when the market opens tomorrow, November 10, 2022, under a new CUSIP number, 62011B 201.
As a result of the reverse stock split, each 10 shares of the Company’s Class A and Class B common stock issued and outstanding immediately prior to the Effective Time will be automatically combined into 1 share of Class A common stock and Class B common stock, respectively, subject to the elimination of fractional shares, as described below.
The same 1-for-10 reverse stock split ratio is being used to effect the reverse stock split of both Motorsport Games Class A and Class B common stock, and accordingly, all stockholders will be affected proportionately. The reverse stock split will reduce the Company’s issued and outstanding shares of common stock from approximately 11,673,587 shares of Class A common stock and 7,000,000 shares of Class B common stock to approximately 1,167,358 and 700,000 shares, respectively.
The number of shares of Class A common stock subject to the Company’s outstanding employee and director stock options, as well as the relevant exercise price per share, will be proportionately adjusted to reflect the reverse stock split. Accordingly, the approximately 821,962 outstanding stock options will be reduced to approximately 82,196 outstanding stock options. The number of shares authorized for issuance under the Company’s stock plan also will be reduced from 1,000,000 shares of Class A common stock to 100,000 shares of Class A common stock using the same 1-for-10 split ratio.
Motorsport Games has retained its transfer agent, Worldwide Stock Transfer, LLC (“WST”), to act as exchange agent for the reverse stock split. WST will manage the exchange of old, pre-reverse stock split shares for new post-split shares. Stockholders who hold their shares in “street name” will be contacted by their banks or brokers with any instructions. For further information, stockholders and securities brokers should contact WST at (201) 820-2008.
Motorsport Games will not issue any fractional shares of its Class A or Class B common stock as a result of the reverse stock split. Instead, as soon as practicable after the Effective Time, WST will distribute payments to the record holders’ respective accounts pro rata in lieu of fractional shares based on the applicable NASDAQ closing trading price. Stockholders will not be entitled to receive interest for the period of time between the Effective Time and the date the stockholder receives their cash payment, if any, in lieu of fractional shares.
Upon the Effective Time, each certificate, if any representing shares of Motorsport Games common stock immediately prior to the reverse stock split will be deemed to represent the number of full shares of common stock resulting from the reverse stock split. Stockholders holding their shares in book entry form are not required to take any action, as their shares will be adjusted directly by WST.
