Grove Collaborative Holdings, Inc. (NYSE:GROV) (“Grove” or “the Company”), a leading sustainable consumer products company and Certified B Corp, today announced that its Board of Directors approved a reverse stock split of the Company’s common stock at a 1-for-5 ratio. On May 24, 2023, the Company’s stockholders approved a reverse stock split of the Company’s common stock using a split ratio of not less than 1-for-5 and not more than 1-for-25, with the final determination of a ratio within the split ratio range to be approved by the Company’s Board of Directors.
The reverse stock split is expected to be effective after market close on June 5, 2023 (the Effective Time). The Company’s common stock will begin trading on a split-adjusted basis on The New York Stock Exchange (NYSE) when the market opens on June 6, 2023.
At the Effective Time, every five issued and outstanding shares of the Company’s common stock will be converted into one share of the Company’s common stock. Once effective, the reverse stock split will reduce the number of shares of the Company’s class A common stock issued and outstanding from approximately 129 million to approximately 26 million, and the number of shares of the Company’s class B common stock issued and outstanding from approximately 50 million to approximately 10 million. No fractional shares will be issued in connection with the reverse stock split.
Stockholders who otherwise would be entitled to receive fractional shares will instead receive a cash payment (without interest) equal to the fractional share of post-reverse split common stock to which such stockholder would otherwise be entitled multiplied by the average of the closing sales prices of a share of the Company’s class A common stock (as adjusted to give effect to the reverse stock split) on the NYSE during regular trading hours for each of the five consecutive trading days immediately preceding the date of the Effective Time.
All outstanding public warrants to purchase the Company’s class A common stock will be proportionately adjusted as a result of the reverse stock split in accordance with the terms of the warrants, such that every five shares of the Company’s class A common stock that may be purchased pursuant to the public warrants immediately prior to the reverse stock split now represent one share of the Company’s class A common stock that may be purchased pursuant to such warrants immediately following the reverse stock split. Correspondingly, the exercise price per share of the Company’s class A common stock attributable to such warrants immediately prior to the reverse stock split has been proportionately increased, such that the exercise price per share of the Company’s class A common stock attributable to such warrants immediately following the reverse stock split is $57.50, which equals the product of five multiplied by $11.50, the exercise price per share immediately prior to the reverse stock split. The number of shares of the Company’s class A common stock subject to the public warrants will be decreased by five times, to an aggregate of 1,610,000 shares. Proportionate adjustments will be made to the exercise prices, grant prices or purchase prices and the number of shares underlying the Company’s outstanding equity awards, as applicable, and private warrants exercisable for shares of the Company’s common stock, as well as to the number of shares issuable under the Company’s equity incentive plans, as determined by the Compensation Committee of the Company’s Board of Directors and/or in accordance with the terms of certain existing agreements, as applicable.
Holders of the Company’s common stock held in book-entry form or through a bank, broker or other nominee do not need to take any action in connection with the reverse stock split. Stockholders of record will be receiving information from Continental Stock Transfer and Trust Company, the Company’s transfer agent, regarding their stock ownership post-reverse stock split. All other questions can be directed to the transfer agent, which can be reached at (800) 509-5586.
The reverse stock split does not modify any rights or preferences of the Company’s common stock. The reverse stock split will not affect the number of authorized shares of the Company’s common stock or the par value of the Company’s common stock. The reverse stock split is intended to increase the market price per share of the Company’s common stock to enhance the Company’s ability to regain compliance with the NYSE minimum share price listing rule for continued listing on the NYSE, and to improve the marketability and liquidity of the Company’s common stock. The Company will be deemed to have regained compliance with the NYSE’s continued listing standards if the price of the Company’s class A common stock remains above $1 per share for 30 trading days following the Effective Time, or by as early as July 20, 2023.
The trading symbol for the Company’s class A common stock will remain “GROV.” The new CUSIP number for the Company’s class A common stock following the reverse stock split will be 39957D201. The trading symbol and CUSIP number for the Company’s warrants will remain unchanged.
