NASHVILLE, TN - American Rebel Holdings, Inc. (NASDAQ: AREB), known as "America's Patriotic Brand," has declared a reverse stock split of its common stock at a ratio of 1-for-9, effective at the start of trading on October 2, 2024. This strategic move aims to bring the company's stock price above the Nasdaq's minimum bid requirement of $1.00 per share to maintain its listing.
The reverse stock split will consolidate approximately 9.2 million existing shares of common stock into approximately 1.02 million shares. Stockholders will not receive fractional shares in the process; instead, any fractional interests will be rounded up to the nearest whole number of shares.
The adjustment will also affect the company's outstanding derivative securities and equity incentive plans, with exercise prices and numbers of derivatives to be proportionately adapted. The stock will continue trading on the Nasdaq under the ticker symbol AREB, but with a new CUSIP number, 02919L505.
This corporate action follows the approval by American Rebel Holdings' stockholders on February 13, 2024, authorizing the board of directors to implement a reverse stock split at a ratio of up to 1-for-10 at their discretion within a year. The board decided on the 1-for-9 ratio on September 17, 2024.
Securities Transfer Corporation will serve as the exchange and paying agent for the reverse stock split. Shareholders with physical stock certificates will receive instructions for exchanging their pre-split certificates for book-entry ownership or post-split stock certificates. Those holding shares in book-entry form or through brokerage accounts are not required to take any action.
American Rebel Holdings has diversified its business from designing and marketing safes and personal security products to entering the beverage industry with American Rebel Beer. The company also offers branded apparel and accessories.
The information in this article is based on a press release statement from American Rebel Holdings, Inc. Investors and stockholders are encouraged to contact their banks, brokers, or custodians for any procedural inquiries related to the reverse stock split.
In other recent news, American Rebel Holdings Inc. has issued 669,643 shares of common stock to settle an agreement with a vendor, a move that potentially conserves cash reserves for other uses. The company has also appointed Todd Porter as the President of its beverage division, American Rebel Beverages, LLC. Porter will lead the expansion of the company's beer brand, American Rebel Light Beer, which is expected to generate around $1 million in sales for 2024.
American Rebel has secured two significant loans, one for $179,400 from 1800 Diagonal Lending, LLC, and another for $400,000 from board director Lawrence Sinks, to support its operations. However, the company is currently facing a trademark infringement lawsuit filed by Liberty Safe and Security Products, Inc., which could potentially impact its financial and operational outcomes.
Thomas Mihalek has taken over as the CEO of its subsidiary, Champion Safe Co., and GBQ Partners LLC has been appointed as its independent auditors. Lastly, American Rebel has initiated a Reg A+ offering, inviting investors to participate in the company's growth, with a cautionary note about the associated risks and potential illiquidity. These are the recent developments for American Rebel Holdings Inc.
InvestingPro Insights
American Rebel Holdings' decision to implement a reverse stock split comes at a critical time for the company. According to InvestingPro data, AREB's market capitalization stands at a modest $4.17 million, reflecting its current challenges. The company's financial health appears precarious, with InvestingPro Tips highlighting that AREB "operates with a significant debt burden" and "may have trouble making interest payments on debt."
Despite these challenges, there are some positive indicators. An InvestingPro Tip notes that "net income is expected to grow this year," and "analysts anticipate sales growth in the current year." This aligns with the company's strategic moves, including the reverse stock split and its diversification into the beverage industry with American Rebel Beer.
However, investors should be cautious. The company's revenue for the last twelve months as of Q2 2024 was $15.45 million, with a concerning revenue growth of -3.59% over the same period. Additionally, AREB's gross profit margin stands at a low 10.42%, which an InvestingPro Tip confirms by stating the company "suffers from weak gross profit margins."
For those considering AREB's potential, it's worth noting that InvestingPro offers 14 additional tips for this stock, providing a more comprehensive analysis for investors looking to make informed decisions in this volatile situation.
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