v3.25.1
STOCKHOLDERS’ EQUITY
 3 Months Ended
Mar. 31, 2025
Equity [Abstract]  
STOCKHOLDERS’ EQUITY

19. STOCKHOLDERS’ EQUITY

 

Class A Common Stock

 

Class A common stock confers upon the holders the rights to receive notice to participate and vote at any meeting of stockholders of the Company, to receive dividends, if and when declared, and to participate in a distribution of surplus of assets upon liquidation of the Company.

 

Class B Common Stock

 

The Class B common stock is identical to the Class A common stock, with the exception that each share thereof carries 10 times the voting power of a share of Class A common stock. The Class B common stock is convertible at any time into Class A common stock on a one-for-one basis.

 

Preferred Stock

 

Preferred stock as of March 31, 2025 consisted of the following:

                         
   Par Value
Per Share		   Stated Value
Per Share		   Shares
Authorized		   Liquidation
Preference		   Shares Issued and
Outstanding at
March 31, 2025		 
Series A Convertible Preferred Stock  $0.001   $25    1,000,000   $176,000    7,040 
Series B Convertible Preferred Stock  $0.001   $1,000    60,000    -    - 
Series C Convertible Preferred Stock  $0.001   $1,000    75,000    50,000,000    50,000 
Series D Cumulative Redeemable Perpetual Preferred Stock  $0.001   $25    2,000,000    11,345,000    453,792 
Series E Redeemable Perpetual Preferred Stock  $0.001   $25    2,500,000    16,250,000    649,998 
Series F Exchangeable Preferred Stock  $0.001   $1,000    1,000,000    999,000    998,577 
Series G Convertible Preferred Stock  $0.001   $1,000    25,000    860,000    860 
Unallocated             18,340,000           
Total             25,000,000   $79,630,000    2,160,267 

 

 

Preferred stock as of December 31, 2024 consisted of the following:

 

   Par Value
Per Share		   Stated Value
Per Share		   Shares
Authorized		   Liquidation
Preference		   Shares Issued and
Outstanding at
December 31, 2024		 
Series A Convertible Preferred Stock  $0.001   $25    1,000,000   $176,000    7,040 
Series C Convertible Preferred Stock  $0.001   $1,000    75,000    50,000,000    50,000 
Series D Cumulative Redeemable Perpetual Preferred Stock  $0.001   $25    2,000,000    8,096,000    323,835 
Series E Redeemable Perpetual Preferred Stock  $0.001   $25    2,500,000    16,250,000    649,998 
Series F Exchangeable Preferred Stock  $0.001   $1,000    1,000,000    999,000    998,577 
Series G Convertible Preferred Stock  $0.001   $1,000    25,000    -    - 
Unallocated             18,400,000           
Total             25,000,000   $75,521,000    2,029,450 

 

The Company is authorized to issue 25.0 million shares of preferred stock, $0.001 par value. As of March 31, 2024, the rights, preferences, privileges and restrictions on the remaining authorized 18.3 million shares of preferred stock have not been determined. The Board is authorized to designate a new series of preferred shares and determine the number of shares, as well as the rights, preferences, privileges and restrictions granted to or imposed upon any series of preferred shares.

$50.0 Million Securities Purchase Agreement for Sale of Series B Convertible Preferred Stock

 

On March 31, 2025, the Company entered into a securities purchase agreement with an institutional investor pursuant to which the Company agreed to sell up to 50,000 shares of Series B Convertible Preferred Stock (“Series B Preferred Stock”) for a total purchase price of up to $50.0 million. The securities purchase agreement provides that the transaction shall be conducted through 49 separate tranche closings, provided, however, that the investor has the ability, exercisable in its sole discretion, to purchase any number of shares of Series B Preferred Stock prior to the dates of the tranche closings provided for in the securities purchase agreement. The initial tranche closing, which is expected to close promptly after the investor has converted out of the Exchange Note, will consist of the sale and issuance to the investor of 2,000 shares of Series B Preferred Stock for an aggregate of $2.0 million. Pursuant to the securities purchase agreement, provided certain closing conditions have been met, the investor shall purchase up to 4,800 shares of Series B Preferred Stock on a monthly basis, with the investor being required to purchase 1,000 shares per month.

 

Each share of Series B Preferred Stock has a stated value of $1,000 and is convertible into shares of Class A common stock at a conversion price equal the lesser of a 25% discount to the Company’s volume weighted average price during the five trading days immediately prior to (A) the date of execution of the securities purchase agreement or (B) the date of conversion into shares of Class A common stock, but not greater than $10 per share. Notwithstanding the foregoing, in no event shall the Series B Preferred Stock be convertible at less than the Floor Price. The holders of Series B Preferred Stock are entitled to cumulative cash dividends at an annual rate of 15%, or $150 per share, based on the stated value per share. Dividends shall accrue for as long as any shares of Series B Preferred Stock remain issued and outstanding and are payable monthly in arrears. For the first two years, the Company may elect to pay the dividend amount in additional shares of Series B Preferred Stock rather than cash. The holders of the Series B Preferred Stock are entitled to vote with the Class A common stock as a single class on an as-converted basis.

 

Subsequent Event – Series B Convertible Preferred Stock Amendment

 

On April 23, 2025, the Company filed a Certificate of Amendment to the Certificate of Designation of Preferences, Rights and Limitations of the Series B Convertible Preferred Stock. The amendment, which was approved by the Board of Directors on April 22, 2025, became effective upon filing with the Secretary of State of the State of Delaware. The amendment revised the definition of “Conversion Price” to the greater of (i) the Floor Price and (ii) 75% of the Company’s lowest VWAP during the five trading days immediately preceding conversion, subject to a maximum price of $10.00 per share, as adjusted for certain corporate actions.