Mobix Labs Inc

This management proposal asks shareholders to approve an amendment to the Company’s certificate of incorporation to permit a reverse stock split of all issued and outstanding Class A and Class B common shares at a ratio between 1-for-10 and 1-for-50, with the Board granted sole discretion to (a) select the exact ratio within that range, (b) effect the split at a time of its choosing, and (c) abandon the Amendment entirely without further shareholder action. Management is pursuing the authority principally to address a Nasdaq deficiency notice for the Company’s Class A common stock (failure to meet the $1.00 minimum bid price under Rule 5550(a)(2)) and to reduce the risk of delisting by immediately increasing the per-share trading price through consolidation. The Proposal does not reduce authorized shares, which means that if the Board implements the split the number of authorized but unissued shares will increase in proportion to outstanding shares being reduced—an effect the Board notes could facilitate future capital raises but also could be viewed as increasing potential dilution and have anti-takeover implications. The filing explains mechanics (including cash-out of fractional shares at fair value), accounting and tax considerations, the effect on outstanding warrants, RSUs and equity awards, and that the Board will consider market conditions, market capitalization, and other factors when choosing the exact ratio. The Board emphasizes it cannot guarantee the split will accomplish its objectives—historically some reverse splits fail to produce sustained price improvement and can reduce liquidity or be perceived negatively by the market—and carefully discloses risks to investors. Because the split is discretionary even if approved, shareholders are effectively granting the Board flexibility to respond to market conditions but also ceding later approval on the specific ratio; the Board cites preservation of Nasdaq listing and improved marketability to justify that discretion. The Board recommends a vote FOR the Proposal as a potentially necessary step to maintain Nasdaq listing and to provide the Board tools to manage capital structure, but warns of possible adverse effects including dilution, reduced liquidity, and uncertain market response.

This management proposal seeks shareholder approval under Nasdaq Listing Rule 5635(d) to permit the Company to issue up to a total of 9,613,754 shares of Class A Common Stock upon potential exercises of three sets of warrants (the Inducement Warrant for 8,229,701 shares, Placement Agent Warrants for 384,053 shares, and an additional Common Stock Warrant for 1,000,000 shares). The Inducement Warrant was issued to an institutional holder in connection with that holder’s cash exercise of existing warrants as an inducement in a transaction that generated approximately $4.5 million of gross proceeds to the Company; Roth Capital Partners received the placement agent warrants as a fee. The warrants have an exercise price of $1.08 per share, are exercisable only after stockholder approval, are subject to customary anti-dilution and ownership limitations, and include cashless exercise and fundamental-transaction provisions. Nasdaq Listing Rule 5635(d) requires shareholder approval because the aggregate issuance could meet the 20% threshold or otherwise trigger the Rule when issued at a price below the “Minimum Price,” and failure to obtain such approval would require the Company to repeatedly call special meetings every 60 days until approved or until the warrants expire, creating significant cost and distraction. The Board considered the Company’s cash and funding requirements, the potential dilutive impact, and accounting considerations (including amendments intended to achieve equity classification under ASC guidance) and concluded that obtaining shareholder approval was in the Company’s best interest to allow potential future cash infusions and to satisfy Nasdaq governance requirements. The Board discloses the likely dilutive effect on existing holders, warns that the exercise may depress book value and earnings per share, and notes there is no guarantee the warrants will be exercised for cash; nonetheless it recommends a vote FOR the Proposal to preserve financing flexibility and comply with Nasdaq rules.