MMAT Meta Materials Inc

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-K/A

(Amendment No. 3)

(Mark One)

☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2022

OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO

 

Commission File Number: 001-36247

Meta Materials Inc.

(Exact Name of Registrant as Specified in its Charter)

 

Nevada	74-3237581
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
60 Highfield Park Drive Dartmouth, Nova Scotia, Canada	B3A 4R9
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (902) 482-5729

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	MMAT	Nasdaq Capital Market

 

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant, based on the closing price of the shares of common stock on June 30, 2022, was $371,634,314.

The number of shares of Registrant’s Common Stock outstanding as of April 27, 2023 was 467,078,221.

 

Auditor Firm Id: 85; Auditor Name: KPMG LLP; Auditor Location: Vaughan, Canada

 

 

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EXPLANATORY NOTE

 

This Amendment No. 3 to Form 10-K of Meta Materials, Inc., referred to in this report as the "Company”, “META”, "we", "us" or "our", is being filed solely

(i) to correct and update certain information regarding executive compensation set forth in Part III, Item 11, including:

a) correcting the amount of bonus earned by George Palikaras, our President and Chief Executive Officer, in fiscal year 2021, which was understated by $297,500;

b) correcting the amount of option awards granted to Mr. Palikaras and Jonathan Waldern, our former Chief Technology Officer, in fiscal year 2021 from $261,213 and $175,587 to be $Nil as they were not granted;

c) updating the amount of bonus earned by Mr. Palikaras in fiscal year 2022 from $366,127, which amount was based on an estimate in Amendment No. 2 to the Original Filing, to be $Nil as it was never awarded; and

d) updating the amount of bonus earned by Dr. Waldern in fiscal year 2022 from $190,000, which amount was based on an estimate in Amendment No. 2 to the Original Filing, to be $200,000.

(ii) to correct certain information regarding outstanding equity awards at December 31, 2022 set forth in Part III, Item 11, including:

a) correcting the number of shares or units of stock that have not vested for Mr. Palikaras to include 1,461,240 deferred stock units with market value of $1,738,876; and

b) correcting the number of exercisable and unexercisable stock options for Dr. Waldern commencing on December 14, 2020 to be 385,718 and 1,028,588 respectively.

(iii) to restate Part II, Item 9A, to reflect deficiencies in disclosure controls and procedures identified by the Company’s management related to such errors.

 

As required by Rule 12b-15, in connection with this Amendment No. 2, the Company’s Principal Executive Officer and Principal Financial Officer are providing new Rule 13a-14 certifications. Because no financial statements have been included in this Amendment No. 3, paragraph 3 of the certifications has been omitted. Additionally, because no financial statements are contained within this Amendment No. 3, the Company has not included new certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Except as explicitly set forth herein, this Amendment No. 3 does not purport to modify or update the disclosures in, or exhibits to original Form 10-K (the “Original Filing”), Amendment No. 1 or Amendment No. 2, or to update the Original Filing, Amendment No. 1 or Amendment No. 2 to reflect events occurring after the date of such filing.

 

 

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Table of Contents

		Page
PART II
Item 9A.	Controls and Procedures	4
PART III
Item 11.	Executive Compensation	6
PART IV
Item 15.	Exhibits, Financial Statement Schedules	13

 

 

 

 

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PART II

Item 9A. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Prior to the Original Filing, Amendment No. 1 and Amendment No. 2, management, with the participation of the Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2022. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Based on such evaluation of our disclosure controls and procedures as of December 31, 2022, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were not effective due to a material weakness in our internal control over financial reporting, as described below under “Management’s Report on Internal Control over Financial Reporting.”

In connection with the preparation and filing of this Amendment No. 3, our Chief Executive Officer and Chief Financial Officer re-evaluated the effectiveness of the design and operation of our disclosure controls and procedures, taking into account the errors summarized in the Explanatory Note to, and corrected in Part III, Item 11 of, this Amendment No. 3. Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that as of December 31, 2022, our disclosure controls and procedures were not effective due to the aforementioned material weakness and also due to incomplete corporate records and a lack of effective processes relating to the preparation and review of the executive compensation disclosures required by Part III, Item 11 of Form 10-K. We are implementing additional operational procedures designed to ensure the effectiveness of our disclosure controls and procedures with respect to future reports that we file with or submit to the SEC under the Exchange Act.

Notwithstanding the foregoing, giving full consideration to the remaining material weakness, we have concluded that the consolidated financial statements included in the Annual Report on Form 10-K present fairly, in all material respects, our financial position, the results of our operations and our cash flows for each of the periods presented in conformity with U.S. generally accepted accounting principles.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining effective internal control over financial reporting, as such term is defined in Securities Exchange Act Rules 13a-15(f) and 15d-15(f). Our internal control over financial reporting is a process designed by and under the supervision of our management, including our Chief Executive Officer and Chief Financial Officer, and effected by our management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with U.S. generally accepted accounting principles.

Our management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2022, using the criteria set forth in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on the results of this evaluation, our management concluded that our internal control over financial reporting was not effective as of December 31, 2022, due to the existence of a material weakness as described below. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements may not be prevented or detected on a timely basis.

Management has determined that a material weakness in internal control over financial reporting existed at December 31, 2022 due to the existence of the following identified deficiencies:

 

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This material weakness resulted in material misstatements which have been corrected, and also in immaterial misstatements, some of which were corrected prior to the release of our consolidated financial statements as of and for the year ended December 31, 2022. This material weakness creates a reasonable possibility that a material misstatement to the consolidated financial statements will not be prevented or detected on a timely basis.

Plan for Remediation of Material Weakness

Management has been and is continuing to evaluate and strengthen our internal controls over financial reporting to ensure that management can routinely prepare our financial statements under US GAAP, meet the requirements of our independent auditors and remain in compliance with the SEC reporting requirements. These efforts are time consuming and require significant resource investment that we are committed to making.

As of December 31, 2022, we are still developing and documenting the full extent of the procedures to implement, and remediate the material weakness described above, however the current remediation plan includes:

Changes in Internal Controls

During the year ended December 31, 2022, we have implemented the following remediation steps:

Except for the remediation efforts related to the material weakness described above, no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the quarter ended December 31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Limitations on Effectiveness of Internal Controls

Management, including the Chief Executive Officer and Chief Financial Officer, does not expect that disclosure controls or internal controls will prevent all errors and detect all accounting irregularities. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. In addition, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of accounting irregularities, if any, within a company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake.

Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people. The design of any systems of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, control may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of these inherent limitations in a cost-effective control system, misstatements due to errors may occur and not be detected.

 

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PART III

Item 11. Executive Compensation.

 

Compensation of Named Executive Officers

 

Summary Compensation Table

 

The following table summarizes the compensation for each of our executive officers (the “Named Executive Officers”) during the fiscal years ended December 31, 2022 and 2021.

 

Name and principal position	Year		Salary				Bonus				Option awards				Stock awards				Non-equity incentive plan compensa-tion				All other compensation				Total
			($)				($)				($) (1)				($) (1)				($)				($)				($)
George Palikaras	2022		$	424,333			$	-			$	800,000			$	800,000			$	-			$	-			$	2,024,333
President/CEO/Director	2021		$	300,558			$	682,500		(4)	$	-			$	-			$	-			$	-			$	983,058
Kenneth Rice (2)	2022		$	293,333			$	-			$	322,309			$	250,000			$	106,313			$	19,290		(6)	$	991,245
Former CFO and COO	2021		$	231,100			$	200,000		(5)	$	-			$	-			$	104,850			$	19,290		(6)	$	555,240
Jonathan Waldern (3)	2022		$	250,000			$	-			$	3,663,601			$	200,000			$	200,000			$	-			$	4,313,601
Former CTO	2021		$	238,078			$	-			$	-			$	-			$	182,500			$	-			$	420,578

 

(1)	The amounts reported in the Option Awards and Stock Awards columns represent the grant date fair value of the stock options and restricted stock units granted to the named executive officers as of the grant date as computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, not including any estimates of forfeitures. The assumptions used in calculating the grant date fair value of the stock options reported in the Option Awards column and restricted stock units reported in the Stock Awards column are set forth in Note 13 to our financial statements included in our Annual Report on Form 10-K/A for the year ended December 31, 2022 filed with the SEC on March 24, 2023 for option awards in 2022 and in Note 15 to our financial statements included in our Annual Report on Form 10-K/A for the year ended December 31, 2021 filed with the SEC on May 2, 2022 for options awards in 2021. Note that the amounts reported in this column reflect the accounting cost for these stock options, and do not correspond to the actual economic value that may be received by the named executive officers from the options.
(2)	Mr. Rice’s employment as our CFO and COO terminated on April 20, 2023.
(3)	Dr. Waldern’s employment as our CTO terminated on April 21, 2023.
(4)	On July 9, 2021, Mr. Palikaras was awarded a bonus of $300,000 based upon the successful completion of the reverse merger
	with Torchlight. On March 28, 2022, Mr. Palikaras was awarded a bonus of $382,500 based on 2021 performance.
(5)	On July 9, 2021, Mr. Rice was awarded a bonus of $200,000 based upon the successful completion of the reverse merger with
	Torchlight.
(6)	Represents medical expense reimbursement.

 

Overview of Executive Compensation

 

Our executive compensation program has been designed to encourage executives to make decisions and take actions that will result in the improvement of long-term shareholder value as reflected in the growth in assets and value of the shares of our common stock. The focus of our current compensation policy is to:

	•		strengthen the relationship between compensation and enhancement of shareholder value by focusing on variable compensation, such as annual performance incentives and ownership of common stock of the Company, primarily by using options for acquiring common stock of the Company;

	•		enhance the Company’s ability to attract, encourage and retain knowledgeable and experienced executives; and

	•		balance our short-term and long-term business goals.

 

The key components of executive compensation include: (1) base salary; (2) a short-term incentive comprised of quarterly bonus awards paid in cash and/or stock options; and (3) long-term incentives comprised primarily of stock option incentives, which are reviewed annually based on job performance as well as corporate performance and external competitive practices.

 

 

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The Board has utilized the Human Resources and Compensation Committee that works with our CEO to establish annual and quarterly performance measures for each executive, along with assessing our overall performance and the performance of our executives, and relies on its experience and judgment in determining the overall compensation package for executives. Compensation of executives as detailed herein is linked to the achievement corporate and individual objectives, and not to improvements of the market value of our securities.

 

Executive Employment Arrangements and Agreements

 

George Palikaras

On July 1, 2021, Metamaterial Technologies Canada Inc., or Meta Canada, a wholly owned subsidiary of ours, entered into an executive employment contract with George Palikaras, or the Palikaras Employment Agreement, pursuant to which we agreed to employ Mr. Palikaras as our CEO, effective as of July 1, 2021, for an indefinite term in consideration of an annual base salary of CAD $553,500. Pursuant to the terms and conditions of the Palikaras Employment Agreement, Mr. Palikaras was granted a stock option award with a grant date value of $800,000, subject to the terms of our Amended and Restated Employee Stock Option Plan, and a grant of restricted stock units under our 2021 Equity Incentive Plan with a value of $800,000 (prorated for partial years of employment). In the event that the Palikaras Employment Agreement is terminated, we shall provide Mr. Palikaras with earned but unpaid salary, vacation pay and reimbursement of expenses and any other severance amounts as are required by applicable employment standards legislation.

Kenneth Rice

On December 14, 2020, we entered into an executive employment agreement with Kenneth Rice, or the Rice Employment Agreement pursuant to which we agreed to employ Mr. Rice as our CFO and Executive Vice President, effective as of December14, 2020, for an indefinite term. The Rice Agreement provided for an initial annual base salary of $156,000, scheduled to increase to $216,000 on March 1, 2021. Under the terms of the Rice Agreement, Mr. Rice is eligible to receive a quarterly bonus up to a target of $27,000 based on his achievement of a balanced scorecard, in the sole discretion of our Board of Directors. In the first two years following the effective date of the Rice Employment Agreement, 25% of any quarterly bonus shall be issued in an amount of fully vested stock options. In addition, the Rice Employment Agreement provided for a grant to Mr. Rice of an option to acquire 300,000 shares under our Amended and Restated Employee Stock Option Plan.

In the event Mr. Rice’s employment is terminated by us without Cause or Mr. Rice resigns for Good Reason (as defined in the Rice Employment Agreement) and subject to Mr. Rice signing a release within 60 days of termination, the Rice Employment Agreement provides that Mr. Rice will receive continued payment of his base salary for 6 months; payment of two quarterly bonuses to be made quarterly following the termination date; a prorated amount of the quarterly bonus for the calendar quarter in which the termination occurs based on the date of termination; continued Company benefits, excluding disability coverage, for the severance period, if such benefits are available under the terms of our benefits plans; and six months’ accelerated vesting of the initial option grant described above. If Mr. Rice is terminated for Cause, he will only be entitled to earned but unpaid salary, vacation pay and reimbursement of expenses.

Jonathan Waldern

On December 16, 2020, we entered into an executive employment agreement with Jonathan Waldern, or the Waldern Employment Agreement pursuant to which we agreed to employ Dr. Waldern as our CTO, effective as of December16, 2020, for an indefinite term. The Waldern Employment Agreement provided an initial annual base salary of $150,000, scheduled to increase to $250,000 upon achievement of a public offering milestone specified in the agreement. Pursuant to the Waldern Agreement, Dr. Waldern is eligible to receive a quarterly cash bonus up to a target of $50,000 based on achievement of a balanced scorecard, in the sole discretion of the Company or the Board of Directors. In the first two years of employment, Dr. Waldern is also eligible to receive up to 0.25% per quarter of our then outstanding common stock as fully vested stock options. In addition, the agreement provided for a grant to Dr. Waldern of an option to acquire 1,115,000 shares under our Amended and Restated Employee Stock Option Plan.

In the event Dr. Waldern’s employment is terminated by us without Cause or Dr. Waldern resigns for Good Reason (each as defined in the Waldern Employment Agreement), and subject to Dr. Waldern signing a release within 60 days of termination, the Waldern Employee Agreement provides that Dr. Waldern will receive continued payment of base salary for 6 months; payment of two quarterly bonuses to be made quarterly following the termination date; continued benefits, excluding disability coverage, for a period of twelve (12) months, if such benefits are available under the terms of our benefits plans; and six months’ accelerated vesting of the initial option grant described above.

The Waldern Employment Agreement provides that Dr. Waldern may resign without Good Reason (as defined in the Waldern Employment Agreement) by providing the Company with six months’ advance written notice. During the notice period, Dr. Waldern

 

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will be entitled to continue to receive his base salary and benefits, but will not be entitled to quarterly bonuses for any calendar quarter that ends or begins during that 6 month period.

Executive Terminations

Effective as of (i) April 20, 2023, Kenneth Rice was terminated as our CFO and COO and decided to retire, and (ii) April 21, 2023, Jonathan Waldern was terminated as our CTO. In connection with their departure, each of Mr. Rice and Dr. Waldern is expected to receive the severance payments and benefits provided under his respective employment agreement with the Company for a termination without Cause (as defined therein), subject to his execution of a release and discharge agreement and compliance with post-termination restrictive covenants.

 

Uzi Sasson

 

On April 20, 2023, we entered into an executive employment agreement with Mr. Sasson (the “Sasson Employment Agreement”) pursuant to which we agreed to employ Mr. Sasson as our CFO and COO, effective as of April 20, 2023, for an indefinite term in consideration of an initial annual base salary of $375,000. Mr. Sasson is eligible to receive an annual bonus with a target of 65% of his base salary as determined by the Board in its sole discretion, based on achievement of our performance and Mr. Sasson’s individual performance goals. This annual bonus will be prorated for 2023. In addition, in connection with the execution of the Employment Agreement with us, Mr. Sasson will be eligible to receive a stock option to purchase 300,000 shares of our common stock which will vest 25% annually over four years, subject to Mr. Sasson’s continued service with us through each vesting date. Mr. Sasson will also be eligible to receive a long-term incentive equity grant with an aggregate grant date value of $500,000, the Long-Term Incentive Plan ("LTIP") Grant, computed using the Black Scholes valuation model, subject to Mr. Sasson’s continued employment through the grant date. The LTIP Grant will consist of 50% in stock options and 50% in restricted stock units and is expected to vest over a four-year period, with 25% of such options and restricted stock units vesting annually over the next four years after the date of grant. In the event that Mr. Sasson’s employment with us is terminated, he will be eligible for severance benefits in accordance with our established policies, if any, then in effect.

 

 

 

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Outstanding Equity Awards at December 31, 2022

 

The following table presents information regarding all outstanding equity awards and held by each of our named executive officers as of December 31, 2022.

 

		Option Awards															Stock Awards
																					Market
			Number of				Number of										Number of				value of
			securities				securities										shares or				shares or
			underlying				underlying										units of				units of
			unexercised				unexercised				Option						stock that				stock that
			options				options				exercise				Option		have not				have not
Name and principal			(#)				(#)				price				expiration		vested				vested (1)
position			exercisable				unexercisable				($)				date		(#)				($)
George Palikaras				1,476,000		(2)		-			$	0.27			March 23, 2030
President/CEO/Director				-				696,675		(3)	$	1.58			March 3, 2032
																		506,329		(3)	$	602,532
																		1,461,240		(7)	$	1,738,876
Kenneth Rice (6)				553,500		(4)		-			$	0.27			December 14, 2030
Former CFO and COO				-				217,711		(3)	$	1.58			March 3, 2032
				110,252		(4)		-			$	1.21			May 10, 2032
				41,759		(4)		-			$	1.17			June 27, 2032
				68,830		(4)		-			$	1.31			November 11, 2032
																		158,228		(3)	$	188,291
Jonathan Waldern (6)				385,718		(5)		1,028,588		(5)	$	0.27			December 14, 2030
Former CTO				699,457		(4)		-			$	1.97			February 15, 2032
				702,048		(4)		-			$	1.97			February 15, 2032
				492,606		(4)		-			$	1.97			February 15, 2032
				-				174,169		(3)	$	1.58			March 3, 2032
				662,603		(4)		-			$	1.58			May 10, 2032
				741,987		(4)		-			$	1.51			June 27, 2032
				904,826		(4)		-			$	1.31			November 11, 2032
				902,394		(4)		-			$	0.89			October 21, 2032
																		126,582		(3)	$	150,633

 

 

(1)	Represents the market value of the unvested shares underlying the share awards as of December 31, 2022, based on the closing price of our common shares on such date, as reported on the Nasdaq Capital Market, which was $1.19 per share. These amounts do not reflect the actual economic value that will be realized by the named executive officer upon the vesting of the share awards or the sale of the common stock underlying such share awards.
(2)	Vested annually over two years commencing on March 23, 2020.
(3)	Vests annually over four years commencing on March 3, 2022, subject to the terms, conditions and restrictions of the award agreement governing the grant.
(4)	Fully vested at grant dates.
(5)	Vests at 25% one year after grant date and 75% in equal monthly installments over three years after, subject to the terms, conditions and restrictions of the award agreement governing the grant.
(6)	Each outstanding vested stock option held by Mr. Rice terminates 90 days from April 20, 2023, the date of his separation from us and each outstanding vested stock option held by Dr. Waldern terminates 90 days from April 21, 2023, the date of his separation from us.
(7)	Represents fully vested deferred stock units (“DSUs”), which were granted on March 28, 2013. Each unit is convertible at the option of the holder into one common share upon its settlement; however, DSUs are unable to be settled until the holder ceases to be a service provider to the Company. The holder is entitled to settle all DSUs, including dividends and other adjustments, no later than December 1 of the first calendar year commencing after the time of his termination.

 

 

 

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Director Compensation Policy and Programs

Our Board makes its director compensation decisions in consultation with our Human Resources and Compensation Committee, or HRCC, as well as the independent compensation consulting firm retained by our HRCC, or the compensation consultant, to evaluate our compensation policies and practices for non-employee directors. In addition, our Board and HRCC, in consultation with our compensation consultant, periodically review our director cash and equity compensation policies and programs, including our Outside Director Compensation Plan, and seek to ensure that our cash compensation and equity incentives for non-employee directors are competitive with our peer group and that they offer appropriate incentives to continued service as a director or, for prospective directors, to join our Board.

Cash Compensation

The following table summarized the cash compensation payable to our non-employee directors under our current compensation program effective January 1, 2023.

 

			Annualized cash fee (1)
Base Retained			$	50,000
Non-Employee Chairperson			$	35,000
Audit Committee Chair			$	20,000
Human Resources and Compensation Committee Chair			$	20,000
Governance and Nominating Committee Chair			$	15,000
(1) All fees are payable on a quarterly basis.

 

Equity Compensation

Under the terms of our Outside Director Compensation Plan as currently in effect, new outside directors receive an initial award of shares of restricted stock units having a fair value at issuance of $100,000, vesting in equal installments over four years beginning on the one-year anniversary of grant. In addition, our Outside Director Compensation Plan provides for an annual award to outside directors of shares of restricted stock units with a fair value at issuance of $100,000.

Our Chairman, John Harding, also received a grant of 96,195 shares of our common stock in connection with his appointment to our Board.

Our outside directors are permitted to elect to defer delivery of the shares of common stock subject to the restricted stock unit awards upon vesting until the termination of their service as one of our directors.

Pursuant to the terms of our 2021 Equity Incentive Plan, during any fiscal year, none of our outside directors will be granted awards having an initial value greater than $750,000 increased to $1,500,000 in connection with his or her initial service, provided that any awards granted to an individual while he or she was an employee, or while he or she was a consultant but a non-employee director, will not count towards this limit.

 

2022 Director Compensation

 

The following table presents the total compensation for each person who served as a non-employee director of our Board during the fiscal year ended December 31, 2022. Other than as set forth in the table and described more fully below, we did not pay any compensation, reimburse any expense of, make any equity awards or non-equity awards to, or pay any other compensation to any of the other members of our Board in such period.

 

 

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															Non-				Non-
			Fees												equity				qualified				All
			earned												incentive				deferred				other
Name and			or paid				Stock				Option				plan				compen-				compen-
principal			in cash				awards				awards				compen-				sation				sation				Total
position (1)			($)				($) (2)				($)(2)				sation ($)				earnings ($)				($)				($)
John Harding			$	22,500			$	90,000		(3)	$	-			$	-			$	-			$	-			$	112,500
Chairman of the Board of Directors
Ram Ramkumar (4)			$	37,500			$	-			$	-			$	-			$	-			$	-			$	37,500
Former Chairman of the Board of Directors
Allison Christilaw			$	45,000			$	90,000		(6)	$	-		(5)	$	-			$	-			$	-			$	135,000
Director
Steen Karsbo			$	53,125			$	90,000		(8)	$	-		(7)	$	-			$	-			$	-			$	143,125
Director
Eric Leslie			$	45,000			$	90,000		(10)	$	-		(9)	$	-			$	-			$	-			$	135,000
Director
Ken Hannah			$	45,000			$	90,000		(11)	$	-			$	-			$	-			$	-			$	135,000
Director
Maurice Guitton (12)			$	45,000			$	90,000		(14)	$	-		(13)	$	-			$	-			$	-			$	135,000
Former Director

 

(1)	Does not include two directors that joined our Board in April 2023.
(2)	In accordance with SEC rules, this column reflects the aggregate fair value of stock or option awards granted during the fiscal year ended December 31, 2022, computed as of their respective grant dates in accordance with Financial Accounting Standard Board Accounting Standards Codification Topic 718 for share-based compensation transactions. The assumptions used in calculating the grant date fair value of the stock options reported in the Option Awards column are set forth in Note 13 to our financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022.
(3)	Represents a common stock award of 96,195 fully vested shares granted on August 16, 2022.
(4)	Effective August 14, 2022, Mr. Ramkumar resigned from the Board.
(5)	As of December 31, 2022, Ms. Christilaw had outstanding options representing the right to purchase of 553,500 shares of common stock at an exercise price of $0.27 per share.
(6)	Represents a common stock award of 52,632 DSUs granted on December 5, 2022. As of December 31, 2022, Mr. Christilaw had outstanding 82,140 DSUs.
(7)	As of December 31, 2022, Mr. Karsbo had outstanding options representing the right to purchase of 553,500 shares of common stock at an exercise price of $0.27 per share.
(8)	Represents a common stock award of 52,632 DSUs granted on December 5, 2022. As of December 31, 2022, Mr. Karsbo had outstanding 82,140 DSUs.
(9)	As of December 31, 2022, Mr. Leslie had outstanding options representing the right to purchase of 1,083,804 shares of common stock at an exercise price of $0.27 per share.
(10)	Represents a common stock award of 52,632 DSUs granted on December 5, 2022. As of December 31, 2022, Mr. Leslie had outstanding 82,140 DSUs.
(11)	Represents a common stock award of 52,632 DSUs granted on December 5, 2022. As of December 31, 2022, Mr. Hannah had outstanding 96,894 DSUs.
(12)	Effective April 19, 2023, Mr. Guitton resigned from the Board.
(13)	As of December 31, 2022, Mr. Guitton had outstanding options representing the right to purchase of 1,214,197 shares of common stock at an exercise price of $0.27 per share.

 

Page	11

 

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(14)	Represents a common stock award of 52,632 DSUs granted on December 5, 2022. As of December 31, 2022, Mr. Guitton had outstanding 417,006 DSUs.

 

 

 

Page	12

 

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PART IV

Item 15. Exhibits, Financial Statement Schedules.

 

Exhibit Index

 

 

				Incorporated by Reference
Exhibit Number		Exhibit Description		Form		Filing Date		Filed Herewith
1.1.0		Amended and Restated Placement Agency Agreement, dated as of June 27, 2022, by and among Meta Materials Inc., Roth Capital Partners, LLC and A.G.P./Alliance Global Partners		8-K		27-Jun-22
1.2.0		At Market Issuance Sales Agreement dated February 10, 2023, by and between the Company and the Agents		8-K		10-Feb-23
1.1.2		Amended and Restated Placement Agency Agreement, dated as of June 27, 2022.		8-K		27-Jun-22
2.1.0		Arrangement Agreement between Metamaterial Inc. and Torchlight Energy Resources, Inc., dated December 14, 2020		8-K		14-Dec-20
2.1.1		Amendment to Arrangement Agreement dated February 3, 2021		8-K		3-Feb-21
2.1.2		Amendment to Arrangement Agreement dated March 11, 2021		8-K		11-Mar-21
2.1.3		Amendment to Arrangement Agreement dated March 31, 2021		8-K		1-Apr-21
2.1.4		Amendment to Arrangement Agreement dated April 15, 2021		8-K		15-Apr-21
2.1.5		Amendment to Arrangement Agreement dated May 2, 2021		8-K		3-May-21
2.1.6		Amendment to Arrangement Agreement dated June 18, 2021		8-K		21-Jun-21
2.2.0		Arrangement Agreement between Meta Materials Inc. and Nanotech Securities, dated August 4, 2021		10-K		2-Mar-22
2.3.0		Distribution Agreement Between Meta Materials Inc. and Next Bridge Hydrocarbons Inc. dated September 2,2022		10-K/A		24-Mar-23
2.4.0		Meta Materials Inc. - Next Bridge Hydrocarbons Inc. - Tax Matters Agreement, dated September 2, 2022		10-K/A		24-Mar-23
2.5.0		Meta Materials Inc. - Next Bridge Loan Agreement, dated September 2, 2022		10-K/A		24-Mar-23
2.6.0		Meta Materials Inc. & Oilco Holdings Inc - 8% Promissory Note Secure - $15 mil loan dated October 1, 2021		10-K/A		24-Mar-23
2.7.0		Stock Pledge Agreement between Gregory McCabe & Meta Materials Inc. dated September 30, 2021		10-K/A		24-Mar-23
2.8.0		Stock Purchase Agreement for the Sale and Purchase of the Entire Issued Share Capital of Plasma App Ltd., dated as of March 31, 2022, by and between Dmitry Yarmolich and Dzianis Yarmolich, on the one hand, and Meta Materials, Inc, on the other hand		10-Q/A		1-Jun-22
2.9.0		Asset Purchase Agreement, dated as of June 16, 2022, by and between Meta Materials Inc., Optodot Corporation, and SCP Management LLC, as Securityholders’ Representative		8-K		17-Jun-22
2.10.0		Stock Purchase Agreement, dated March 31, 2022, by and between Meta Materials Inc., on the one hand, and Dmitry Yarmolich and Dzianis Yarmolich, on the other hand		10-Q/A		31-Mar-22
3.1.0		Articles of Incorporation		10-K		18-Mar-19
3.1.1		Certificate of Amendment to Articles of Incorporation dated December 10, 2014		10-Q		15-May-15
3.1.2		Certificate of Amendment to Articles of Incorporation dated September 15, 2015		10-Q		12-Nov-15
3.1.3		Certificate of Amendment to Articles of Incorporation dated August 18, 2017.		10-Q		9-Nov-18
3.1.4		Amendment to the Articles of Incorporation of Torchlight Energy Resources, Inc., dated June 14, 2021		8-K		16-Jun-21

 

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3.1.5		Certificate of Amendment related to the Reverse Stock Split and Name Change, filed June 25, 2021		8-K		29-Jun-21
3.2.0		Certificate of Designation of Preferences, Rights and Limitations of Series B Special Voting Preferred Stock, dated June 14, 2021		8-K		16-Jun-21
3.3.0		Certificate of Withdrawal of Certificate of Designation of Preference, Rights, and Limitations of Series A Non-Voting Preferred Stock		8-K		15-Dec-22
3.4.0		Certificate of Designation of Preferences, Rights and Limitations of Series B Special Voting Preferred Stock, dated June 14, 2021		8-K		16-Jun-21
3.5.0		Amended and Restated Bylaws		8-K		26-Oct-16
4.1.0		Form of Investor Warrant		10-K		2-Mar-22
4.2.0		Form of Broker Warrant		10-K		2-Mar-22
4.3.0		Form of Common Stock		10-K		2-Mar-22
4.4.0		Form of Common Stock Purchase Warrant (issued in June 2022)		8-K		27-Jun-22
4.5.0		Certificate of Incorporation of 2798832 Ontario Inc., dated December 9, 2020		10-K/A		24-Mar-23
4.5.1		Articles of Amendment of 2798832 Ontario Inc, dated February 3, 2021		10-K/A		24-Mar-23
4.5.2		Articles of Amendment of Metamaterial Exchangeco Inc., dated June 25, 2021		10-K/A		24-Mar-23
4.6.0		Description of Securities		10-K/A		24-Mar-23
9.1.0		Voting and Exchange Trust Agreement by and among the Company and Metamaterial Exchangeco Inc. and AST Trust Company (Canada)		10-K/A		24-Mar-23
10.1.0		Highfield Park, Dartmouth, NS - Lease 20200828 - Original Document		10-K		2-Mar-22
10.2.0		Highfield Park, Dartmouth, NS - Lease 20210603 - Amendment June 1, 2021		10-K		2-Mar-22
10.3.0		Highfield Park, Dartmouth, NS - Subscription Agreement		10-K		2-Mar-22
10.4.0+		Employment Agreement with George Palikaras, dated July 1, 2021		10-K		2-Mar-22
10.5.0		QMB Innovation Centre, London-Lease 20221022-Modification&Expension		10-K/A		24-Mar-23
10.6.0		Burnaby-Vancouver-BC-Lease-20220601-Modification		10-K/A		24-Mar-23
10.7.0+		Employment Agreement with Kenneth Rice, dated December 11, 2020		10-K		2-Mar-22
10.8.0+		Employment Agreement with Jonathan Waldern dated December 16, 2020		10-K		2-Mar-22
10.09.0		Form of Meta Materials Inc. Indemnification Agreement (Incorporated by reference form 8-k filed with the SEC on June 29, 2021)		10-K		2-Mar-22
10.10.0		Form of Stock Option Agreement		10-Q/A		1-June-22
10.11.0		Form of Restricted Stock Unit Agreement		10-Q/A		1-June-22
10.12.0		Form of Amended and Restated Securities Purchase Agreement, dated June 27, 2022		8-K		27-June-22
10.13.0+		Amended and Restated Stock Option Plan		S-8		26-Aug-21
10.14.0+		2021 Equity Incentive Plan		S-8		22-Mar-22
10.15.0		Outside Director Compensation Plan		10-K/A		24-Mar-23
21.1.0		List of Subsidiaries		10-K/A		24-Mar-23
23.1.0		Consent of Independent Registered Public Accounting Firm		10-K/A		24-Mar-23
24.1.0		Power of Attorney		10-K		23-Mar-23
31.1		Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002						X
31.2		Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002						X

 

Page	14

 

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32.1*		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002		10-K/A		24-Mar-23
32.2*		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002		10-K/A		24-Mar-23
101.SCH		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.						X
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document						X
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document						X
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)						X

 

+ Management contract or compensatory plan or arrangement

* The certifications attached as Exhibits 32.1 and 32.2 that accompany this Annual Report on Form 10-K are deemed furnished and not filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of Meta Materials Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Annual Report on Form 10-K, irrespective of any general incorporation language contained in such filing.

 

Page	15

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

		Meta Materials Inc.
Dated: September 6, 2023		By:	/s/ George Palikaras
			George Palikaras
			President and Chief Executive Officer
			(Principal Executive Officer)

 

 

 

 

 

Page	16

 

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Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO

EXCHANGE ACT RULE 13a-14(a)/15d-14(a)

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, George Palikaras, certify that:

 

Date: September 6, 2023	By:	/s/ George Palikaras
		George Palikaras President, Chief Executive Officer and director (Principal Executive Officer)

 

 

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Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO

EXCHANGE ACT RULES 13a-14(a)/15d-14(a)

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Uzi Sasson, certify that:

 

 

Date: September 6, 2023	By:	/s/ Uzi Sasson
		Uzi Sasson Chief Financial Officer and Chief Operating Officer (Chief Financial and Accounting Officer)

 

 

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v3.23.2

Cover Page - USD ($)	12 Months Ended
	Dec. 31, 2022	Apr. 27, 2023	Jun. 30, 2022
Cover [Abstract]
Document Type	10-K/A
Amendment Flag	true
Document Period End Date	Dec. 31, 2022
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	FY
Entity Registrant Name	Meta Materials Inc.
Entity Central Index Key	0001431959
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Interactive Data Current	Yes
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Well-known Seasoned Issuer	No
Entity Public Float			$ 371,634,314
Entity Common Stock, Shares Outstanding		467,078,221
Entity Shell Company	false
Entity Small Business	true
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	false
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	MMAT
Security Exchange Name	NASDAQ
Securities Act File Number	001-36247
Entity Incorporation, State or Country Code	NV
Entity Tax Identification Number	74-3237581
Entity Address, Address Line One	60 Highfield Park Drive
Entity Address, City or Town	Dartmouth
Entity Address, State or Province	NS
Entity Address, Country	CA
Entity Address, Postal Zip Code	B3A 4R9
City Area Code	902
Local Phone Number	482-5729
Document Annual Report	true
Document Transition Report	false
Auditor Firm ID	85
Auditor Name	KPMG LLP
Auditor Location	Vaughan, Canada

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