v3.23.1
Preferred Stock
12 Months Ended
Dec. 31, 2022
Preferred Stock [Abstract]  
PREFERRED STOCK

NOTE 11 – PREFERRED STOCK

 

Our certificate of incorporation, as amended, authorizes the issuance of 1,000,000 shares of blank check preferred stock with such designation, rights and preferences as may be determined from time to time by our board of directors.

 

Series A Preferred Stock

 

The Company may issue up to 10,000 shares of Series A Preferred Stock at a stated value (the “Stated Value”) of $1,000 per share. Holders of Series A Preferred Stock are entitled to the following rights and preferences.

 

Dividends

 

The Series A Preferred Stockholders are entitled to receive cash dividends at a rate per share (as a percentage of the Stated Value per share) of 12% per annum. Dividends accrue quarterly. Dividends are to be paid to the holders from funds legally available for payment and as approved for payment by the Board of Directors of the Company.

 

Conversion

 

The Series A Preferred Stock holders may convert, at their option, on or after the date on which the certain Term Loan is repaid in full, each share of Series A Preferred Stock (along with accrued but unpaid dividends thereon) into such number of shares of common stock as determined by dividing the Stated Value by the conversion price of $9. The holders of Series A Preferred Stock are permitted to convert their shares of Series A Preferred Stock into shares of common stock at such time as the Term Loan has already been repaid in full and there is no further outstanding obligations regarding such indebtedness.

 

Voting

 

Each holder of a share of Series A Preferred Stock has the right to vote its shares of Series A Preferred Stock with the common stock on an as-converted basis, and with respect to such votes, such holder has full voting rights and powers equal to the voting rights and powers of the holders of common stock, and is entitled, to notice of any stockholders’ meeting in accordance with the Company’s bylaws, and is entitled to vote, together with holders of common stock, with respect to any question upon which holders of common stock have the right to vote. Fractional votes shall not be permitted, and such shares shall be rounded up.

 

Liquidation Preference

 

Each share of Series A Preferred Stock will have a liquidation preference equal to the Stated Value plus any accrued but unpaid dividends thereon. In the event of a liquidation, dissolution or winding up of the Company (which includes any merger, reorganization, sale of assets in which control of the Company is transferred or event which results in all or substantially all of the Company’s assets being transferred), the holders of Series A Preferred Stock shall be entitled to receive out of the assets of the Company, before any payment is made to the holders of the Company’s common stock and either in preference to or pari pasu with the holders of any other series of preferred stock that may be issued in the future, a per share amount equal to the liquidation preference.