Following Defense Department worries, the founders of Momentus would divest their holdings
Momentus‘ Russian founders have put their shares in voting confidence and plan to sell them over the next 3 years as the firm seeks to overcome US government worries about foreign investment.
Momentus, as well as Stable Road Acquisition Corporation, which is a special-purpose acquisition company (SPAC) seeking to merge with Momentus, stated in a March 8 filing with the Securities and Exchange Commission that both former chief executive officer Mikhail Kokorich as well as Brainyspace LLC, which is a firm owned by the co-founder Lev Khasis and his wife, had forfeited their power to vote their shares in the firm instantly.
Instead, voting advisors appointed by the company’s board, that neither Kokorich nor Khasis presently serve on, will manage the shares held by Kokorich and Brainyspace for the sake of any shareholder votes. In addition, Kokorich and Brainyspace decided to sell their Momentus shares within a period of three years.
Momentus had Kokorich as its CEO until Jan. 25, when the company announced his resignation, effective immediately. Momentus said at the time that his resignation was made “in an attempt to speed up the resolution of United States government national security as well as foreign ownership concerns,” but did not elaborate.
Momentus stated in a recent SEC filing which on January 21, it “became aware of communication from the United States Department of Defense alleging that Momentus presented a national security risk as a consequence of Mikhail Kokorich as well as Lev Khasis and their related entities’ foreign ownership and the control of Momentus.” According to the firm, the correspondence resulted in Kokorich’s resignation as CEO as well as other steps such as the voting trust and proposals by Brainytrust and Kokorich to divest their shares.
The company has voluntarily notified the Committee on the Foreign Investment in the United States (CFIUS), which examines foreign investments in American businesses. CFIUS has begun a 45-day analysis of Momentus and its possession, which is due to end on April 12th. CFIUS could then conduct an inquiry that would last no longer than 60 days if required.
Momentus told CFIUS that it is prepared to “enter into a mitigation arrangement with the United States government to address any national security issues that the United States government might have relating to international control and ownership of Momentus.” An independent evaluation of the company’s infrastructure, the creation of a data protection plan, and the recruiting of a security officer to monitor any arrangement with the federal government are all part of the plan.