In a significant corporate development, Shapeways Holdings, Inc. has officially ceased operations and filed for Chapter 7 bankruptcy on July 2, 2024. The filing, made in the United States Bankruptcy Court for the District of Delaware, also includes the company's subsidiaries, all of which have stopped operations.
The move to file for bankruptcy comes after an exhaustive review of strategic alternatives. With the bankruptcy proceedings underway, a Chapter 7 trustee is set to be appointed by the court to oversee the liquidation of the company's assets as per the Bankruptcy Code.
Shapeways Holdings, known for its presence in the miscellaneous manufacturing industries, is now confronted with the acceleration of its financial obligations. The bankruptcy has triggered Events of Default under the company's debt instruments, including a notable $669,500 secured promissory note with 3DP Custom Manufacture, LLC.
In conjunction with the bankruptcy announcement, there has been a sweeping departure of Shapeways' leadership team. CEO Greg Kress, CFO Alberto Recchi, and COO Andy Nied have all resigned from their executive roles.
Additionally, the entire board of directors, including Leslie C.G. Campbell, Raj Batra, Ryan Kearny, Greg Kress, Christine Gorjanc, Alberto Recchi, and Josh Wolfe, have tendered their resignations.
These resignations are not due to disagreements on operations or policies but are a direct result of the bankruptcy filing, which effectively dissolves the powers of the board.
The market is now observing the unfolding of this event, with the company's common stock (NASDAQ:SHPW) and warrants (NASDAQ:SHPWW) being directly affected. The information disclosed is based on the latest 8-K filing by Shapeways Holdings, Inc. with the Securities and Exchange Commission. This development marks a significant turn for the company, which had previously been listed under Galileo Acquisition Corp. before its name change in 2019.
In other recent news, Shapeways Holdings, Inc. has encountered a compliance issue with Nasdaq due to a delayed quarterly report filing. The company now needs to submit a plan to regain compliance by July 22, 2024.
Meanwhile, Shapeways has agreed to sell its software division to OTTO dms, Inc., a company owned by Shapeways' CEO Greg Kress and software executive Greg Rothman. The transaction is projected to close by May 20, 2024, pending standard closing conditions.
The sale does not include Shapeways' proprietary InShape software, essential to the company's manufacturing workflow. In addition, the investment firm Needham has revised its price target for Shapeways to $3.00, while maintaining a Buy rating.
This adjustment comes in the wake of the company's recent efforts to address its operational scale and cost structure. Despite a 9% year-over-year increase in revenue and a smaller adjusted EBITDA loss, Shapeways is still exploring various strategic options to secure its future.
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