Stem, Inc. (NYSE:STEM) (the "Company" or "Stem") today announced that it will implement a 1-for-20 reverse stock split of the issued and outstanding shares of the Company's common stock, effective at 12:01 a.m. Eastern Time on June 23, 2025 (the "Effective Time"), in order to regain compliance with the minimum average closing price requirement under the rules of the New York Stock Exchange (the "NYSE"). The Company's common stock is expected to begin trading on a reverse split-adjusted basis as of the opening of trading on June 23, 2025 under the Company's existing trading symbol "STEM" with new CUSIP number 85859N300.
The Company's stockholders approved a reverse stock split at a ratio of between 1-for-10 and 1-for-20 at the Company's Annual Meeting of Stockholders held on June 4, 2025. The Company's Board of Directors (the "Board") subsequently determined the final reverse split ratio on June 9, 2025.
At the Effective Time, every 20 shares of the Company's issued and outstanding common stock will be automatically combined into 1 share of common stock. This is expected to reduce the number of issued and outstanding shares of common stock from approximately 167 million to approximately 8.4 million. Also at the Effective Time, the number of authorized shares of the Company's common stock will be reduced from 500,000,000 to 250,000,000. In addition, adjustments proportionate to the 1-for-20 split ratio will be made to the number of shares of common stock available for issuance under the Company's equity incentive plans; the number of shares issuable, and the applicable exercise prices under the Company's outstanding equity awards under such plans and any outstanding warrants; the conversion rates of outstanding convertible notes, in accordance with the related indentures; the strike prices of existing capped call options; the number of shares authorized for issuance pursuant to the convertible notes and capped call options; the shares reserved for issuance under any equity plan, outstanding equity award, convertible notes, capped call options or otherwise, and as otherwise described in the Company's proxy statement filed with the Securities and Exchange Commission on April 23, 2025 (the "Proxy Statement").
The reverse stock split will affect all stockholders uniformly and will not alter any stockholder's percentage interest in equity, except to the extent that the reverse stock split would result in a stockholder owning a fractional share. No fractional shares will be issued, if, as a result of the reverse stock split, a stockholder would otherwise become entitled to a fractional share because the number of shares of common stock they hold before the reverse stock split is not evenly divisible by the split ratio. Instead, each such stockholder will be entitled to receive a cash payment in lieu of a fractional share.
Computershare Trust Company, N.A., is acting as the exchange agent and transfer agent for the reverse stock split. Stockholders holding their shares electronically are not required to take any action to receive post-split shares. Stockholders owning shares through a bank, broker or other nominee will have their positions adjusted to reflect the reverse stock split and will receive payment for any fractional shares in accordance with their respective bank's, broker's, or nominee's particular processes.
Additional information about the reverse stock split can be found in the Proxy Statement and on the Company's Investor Relations website at investors.stem.com.
Forward-Looking Statements This press release, as well as other statements we make, contains "forward-looking statements" within the meaning of the federal securities laws, which include any statements that are not historical facts. Such statements often contain words such as "expect," "may," "can," "believe," "predict," "plan," "potential," "projected," "projections," "forecast," "estimate," "intend," "anticipate," "ambition," "goal," "target," "think," "should," "could," "would," "will," "hope," "see," "likely," and other similar words. Forward-looking statements address matters that are, to varying degrees, uncertain, such as statements about our reverse stock split and authorized share reduction and the timing thereof; the potential impact of the reverse stock split and authorized share reduction, including their potential impacts on stockholders and on our stock price; and our ability to regain and maintain compliance with the minimum average closing price requirement for continued listing on the NYSE. Such forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results or outcomes to differ materially from those expressed or implied by such forward-looking statements, including but not limited to the risks that the reverse stock split and authorized share reduction may adversely impact our results of operations, business operations and reputation with or ability to serve our stockholders and/or customers, and the trading prices and volatility of our common stock, our inability to execute on, and achieve the expected benefits from, our operational and strategic initiatives, including our cost reduction and restructuring efforts; our inability to successfully execute on our new software and services-centric strategy; uncertainty around the status of the Inflation Reduction Act of 2022 as a result of the change in U.S. Administration; our inability to secure sufficient and timely inventory from our suppliers, as well as contracted quantities of equipment; our inability to meet contracted customer demand; supply chain interruptions, manufacturing or delivery delays and increased supply chain costs, including as a results of trade policies; disruptions in sales, production, service or other business activities; general macroeconomic and business conditions in key regions of the world, including inflationary pressures, general economic slowdown or a recession, high interest rates, changes in monetary policy, changes in trade policies, including tariffs or other trade restrictions or the threat of such actions, and instability in financial institutions; the direct and indirect effects of widespread health emergencies on our workforce, operations, financial results and cash flows; geopolitical instability, such as the armed conflicts between Russia and Ukraine and in the Gaza Strip and nearby areas; the results of operations and financial condition of our customers and suppliers; pricing pressures; severe weather and seasonal factors; our inability to continue to grow and manage our growth effectively; our inability to attract and retain qualified employees and key personnel; our inability to comply with, and the effect on our business of, evolving legal standards and regulations, including those concerning data protection, consumer privacy, sustainability, and evolving labor standards; our inability to regain and maintain compliance with NYSE listing standards; risks relating to the development and performance of our energy storage systems and software-enabled services; our inability to retain or upgrade current customers, further penetrate existing markets or expand into new markets; the risk that our business, financial condition and results of operations may be adversely affected by other political, economic, business and competitive factors; and other risks and uncertainties discussed in this release and in our most recent Forms 10-K, 10-Q and 8-K filed with or furnished to the SEC. If one or more of these or other risks or uncertainties materialize (or the consequences of any such development changes), or should our underlying assumptions prove incorrect, actual results or outcomes, or the timing of these results or outcomes, may vary materially from those reflected in our forward-looking statements. Forward-looking statements and other statements in this release regarding our environmental, social, and other sustainability plans and goals are not an indication that these statements are necessarily material to the Company, investors, or other stakeholders, or required to be disclosed in our filings under U.S. securities laws or any other laws or requirements applicable to the Company. In addition, historical, current, and forward-looking environmental, social, and sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future. Forward-looking statements in this press release are made as of the date of this release, and the Company disclaims any intention or obligation to update publicly or revise such forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.
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Stem Investor Contacts
Erin Reed, Stem
Marc Silverberg, ICR
[email protected]