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Hempacco Announces One-for-Ten Reverse Stock Split

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Hempacco Co., Inc. (NASDAQ: HPCO) announces a 1-for-10 reverse stock split to meet Nasdaq's minimum bid price requirement, reducing outstanding shares from 31.4 million to 3.14 million.
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A reverse stock split is a strategic financial maneuver often employed by companies seeking to optimize their stock price, particularly to meet listing requirements or to enhance the stock's appeal to investors. In the case of Hempacco Co., Inc., the 1-for-10 reverse stock split aims to address the Nasdaq's minimum bid price rule, which mandates that shares trade above $1.00 to maintain listing status.

From a financial perspective, the reduction in authorized shares from 200 million to 20 million is intended to create a perceived increase in the value of each share, though it is important to note that this does not inherently change the company's market capitalization. This could potentially make the stock more attractive to institutional investors, who may shy away from stocks priced too low. However, it is also critical to consider investor sentiment, as reverse splits can sometimes be viewed negatively, suggesting a company's underlying challenges in maintaining its stock value.

In evaluating the implications for stakeholders, the short-term benefit is clear: compliance with Nasdaq requirements and avoidance of delisting. Long-term effects, however, hinge on the company's operational performance and market conditions. Investors should monitor the company's subsequent financial reports and market performance to assess the efficacy of this strategic move.

The hemp industry, within which Hempacco operates, is characterized by volatility and regulatory scrutiny. A reverse stock split in this context can serve as a signal to the market regarding the company's commitment to maintaining its public trading status and improving its stock's marketability. The reduction in outstanding shares to approximately 3.14 million should theoretically increase the scarcity of the stock, possibly leading to higher demand and liquidity.

However, it is paramount to analyze market trends and investor behavior in similar situations. Historical data suggests that the success of reverse stock splits in sustaining long-term share price appreciation is mixed. Therefore, while the reverse stock split may address immediate listing concerns, its impact on investor confidence and the company's reputation must be carefully considered.

For stakeholders, the rounding up of fractional shares to whole shares may be a minor positive, but the overarching concern will be the company's strategic direction post-split. Future growth prospects, product innovation and market expansion will be key factors in determining whether the reverse stock split will be a footnote or a turning point in the company's history.

From a legal standpoint, the board's decision to enact a reverse stock split under Section 78.207 of the Nevada Revised Statutes is a legitimate exercise of corporate power, especially when intended to comply with exchange listing standards. The unilateral action by the board is permissible under corporate governance laws, provided it is done in accordance with the company's articles of incorporation and bylaws.

For shareholders, the rounding up of fractional shares is a favorable legal outcome, avoiding the disenfranchisement that can occur when fractional shares are cashed out. Moreover, the legal mechanisms that enable such corporate actions offer companies like Hempacco a means to swiftly adapt to market conditions and regulatory demands without requiring a shareholder vote, which can be a lengthy process.

It is essential for investors to understand that while the reverse stock split does not alter the par value of shares, it does modify the number of shares they hold and can influence the market perception of the company. Legal compliance in this matter serves to reassure stakeholders that the company is managing its regulatory obligations effectively.

San Diego, California--(Newsfile Corp. - March 8, 2024) - Hempacco Co., Inc. (NASDAQ: HPCO) ("Hempacco" or the "Company"), a vertically integrated hemp manufacturing company, today announced that its Board of Directors on February 20, 2024, approved a 1-for-10 reverse stock split of the Company's issued and outstanding shares of common stock, par value $0.001 per share, accompanied by a corresponding decrease in the Company's authorized shares of common stock (the "Reverse Stock Split"), such that, following the consummation of the Reverse Stock Split, the number of authorized shares of common stock will be reduced from 200,000,000 to 20,000,000. The reverse stock split is anticipated to be effective as of the open of the market on March 13, 2024.

As a result of the Reverse Stock Split, every 10 pre-split shares of Company common stock outstanding will automatically combine into one new share of common stock without any action on the part of the holders, and the number of outstanding common shares will be reduced from approximately 31.4 million shares to approximately 3.14 million shares. Any fractional shares resulting from the Reverse Stock Split will be rounded up to the nearest whole share on a per shareholder basis. The Reverse Stock Split will not affect the par value of the Company's common stock.

The Board of Directors approved the Reverse Stock Split pursuant to Section 78.207 of the Nevada Revised Statutes ("NRS"). The Board of Directors approved the Reverse Stock Split unilaterally pursuant to Section 78.207 of the NRS, solely to enable the Company to expeditiously meet the $1.00 minimum bid price requirement of The Nasdaq Stock Market ("Nasdaq") and to reduce the risk of the Company being delisted as a result of failure to meet those requirements. The Reverse Stock Split will have no effect on the Company's authorized preferred stock. The Company anticipates that the effective time of the Reverse Stock Split will be before market open on March 13, 2024, with the common stock trading on a post-split basis under the Company's existing trading symbol, "HPCO," at the market open on March 13, 2024, with a new CUSIP number, 42371L205. The Reverse Stock Split will increase the market price per share of the Company's common stock, and is intended to bring the Company into compliance with the $1.00 minimum bid listing requirements of Nasdaq.

Transfer Online, the Company's transfer agent, will act as the exchange agent for the Reverse Stock Split.

About Hempacco
Hempacco Co., Inc.'s goal is Disrupting Tobacco's™ nearly $1 trillion industry with herb and hemp-based alternatives to nicotine cigarettes by manufacturing and marketing herb, spice, and cannabinoid smokables and rolling paper. Hempacco owns The Real Stuff™ functional hemp cigarette and rolling paper brand. Hempacco is a majority-owned subsidiary of Green Globe International Inc. (OTC Pink: GGII), a fast-moving consumer goods incubating company.

Hempacco's operating segments include:

  1. Manufacturing of smokables, hemp rolling paper, and cannabinoid sticks
  2. Smokable technology development
  3. The Real Stuff™ brand of functional smokables and rolling paper
  4. Cheech and Chong Hemp Cigarettes and Hemp Hop Smokables with Rick Ross
  5. Snoop Dogg Joint Venture of Hemp-Derived Products

Learn more at www.hempacco.com

Learn more at www.ggiigroup.com

Order products at www.realstuffsmokables.com

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Hempacco Announces One-for-Ten Reverse Stock Split 

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For investor inquiries, please contact:
Sandro Piancone, CEO
Investor Relations: ir@hempaccoinc.com
619-779-0715

Safe Harbor Statement

This press release contains forward-looking statements. In addition, from time to time, we or our representatives may make forward-looking statements orally or in writing. We base these forward-looking statements on our expectations and projections about future events, which we derive from the information currently available to us. Such forward-looking statements relate to future events or our future performance, including: our financial performance and projections; our growth in revenue and earnings; and our business prospects and opportunities. You can identify forward-looking statements by those that are not historical in nature, particularly those that use terminology such as "may," "should," "expects," "anticipates," "contemplates," "estimates," "believes," "plans," "projected," "predicts," "potential," or "hopes" or the negative of these or similar terms. In evaluating these forward-looking statements, you should consider various factors, including: (i) potential failure to meet projected development and related targets; (ii) changes in applicable laws or regulations that may impact our products and business; (iii) the effect of the COVID-19 pandemic on the Company and its current or intended markets; and (iv) other risks and uncertainties described herein, as well as those risks and uncertainties discussed from time to time in other reports and other public filings with the Securities and Exchange Commission (the "SEC") by the Company. These and other factors may cause our actual results to differ materially from any forward-looking statement. Forward-looking statements are only predictions. The forward-looking events discussed in this press release and other statements made from time to time by us or our representatives, may not occur, and actual events and results may differ materially and are subject to risks, uncertainties, and assumptions about us. We are not obligated to publicly update or revise any forward-looking statement, whether as a result of uncertainties and assumptions, the forward-looking events discussed in this press release and other statements made from time to time by us or our representatives might not occur.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/201093

Hempacco Co., Inc. (HPCO) announced a 1-for-10 reverse stock split to reduce outstanding shares and meet Nasdaq's minimum bid price requirement.

The reverse stock split is anticipated to be effective as of the open of the market on March 13, 2024, for Hempacco Co., Inc. (HPCO).

The purpose of the reverse stock split for Hempacco Co., Inc. (HPCO) is to increase the market price per share and comply with Nasdaq's $1.00 minimum bid listing requirements.

Transfer Online, the Company's transfer agent, will act as the exchange agent for the Reverse Stock Split of Hempacco Co., Inc. (HPCO).
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About HPCO

green globe international, inc., through its subsidiary, green globe, ltd. owns rights to the green globe brand for the independent certification of sustainable travel, tourism, and related green businesses. the company was formerly known as gtrex, inc. green globe international, inc. was incorporated in 1999 and is based in murrieta, california.