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Note 14 - Stockholders' Equity
 3 Months Ended
Aug. 31, 2026
Notes to Financial Statements  
Equity [Text Block]

Note 14. Stockholders' equity 

 

Issued and outstanding

 

Pursuant to its Fifth Amended and Restated Certificate of Incorporation, the total number of shares that the Company is authorized to issue is 1,426,000,000 shares, of which 1,416,000,000 shares are Common Stock, and 10,000,000 shares of which are Preferred Stock (the “Preferred Stock”). As of  August 31, 2026, the Company had issued and outstanding 144,936,074 shares of Common Stock, 1,124,869 shares of Treasury Stock (the “Treasury Stock”) and no Preferred Stock. Historically, the Company has issued shares of its Common Stock in consideration for acquisitions and other strategic transactions, settlement of convertible notes, settlement of litigation claims, in connection with public offerings and as payment of dividends to non-controlling interests for profit distributions.

 

During the three months ended August 31, 2026, the Company had the following changes in shares of Common Stock:

 

 

a)

4,645,344 shares of Common Stock were issued pursuant to its At-the-Market (“ATM”) program, which generated gross proceeds of $22,887 and net proceeds of $22,338, after deducting $549 in commissions and other fees associated with these issuances.

 

b)

5,229,861 shares of Common Stock were issued having a value of $24,634 on the date of issuance in exchange for the cancellation of $24,000 of the TLRY 27 Notes. Upon exchanging the TLRY 27 Notes, a portion of the settlement consideration was allocated to the equity component of the instrument and was recognized as a $6,358 reduction of additional paid-in capital. Following consummation of the exchange, the number of outstanding Borrowed Shares of Common Stock was reduced by approximately 535,652 shares which were then returned as Treasury Stock, see Note 12 (Convertible debentures payable).

 

c)

1,990,747 shares of Common Stock were issued in connection with the exercise of previously awarded stock-based compensation awards, net of cancellations.

 

d)

1,387,047 shares of Common Stock were issued upon the achievement of the applicable performance conditions and vesting of the related Performance-Based Elective Settlement Award.

 

During the three months ended August 31, 2026, the Company granted 7,379,612 time-based Restricted Stock Units (“RSUs”) pursuant to the 2018 Equity Incentive Plan (“EIP”). During the fiscal year ended  May 31, 2026, the Company granted 4,562,669 time-based RSUs pursuant to the EIP.

 

During the three months ended August 31, 2026, the Company granted nil performance-based RSUs. During the fiscal year ended  May 31, 2026, the Company granted the following performance-based RSUs: 

 

Beginning in fiscal year ended  May 31, 2024, the Company issued (i) 756,615 performance‑based restricted stock units (the “Performance‑Based RSUs”) and (ii) additional performance‑based awards payable in cash or, at the discretion of the Company’s Compensation Committee, in shares of the Company’s common stock (the “Performance‑Based Elective Settlement Award,” and together with the Performance‑Based RSUs, the “Performance‑Based Awards”). The Performance‑Based Awards were not considered granted for accounting purposes at the time of issuance because the applicable performance conditions had not yet been established or approved. Accordingly, no compensation expense was recognized within the Consolidated Statements of Loss at that time. During the period from issuance through the fiscal year ended  May 31, 2026, the number of outstanding Performance‑Based RSUs was reduced from 756,615 to 744,117 as a result of employee attrition, and the Performance‑Based Elective Settlement Award was also correspondingly reduced.

 

In September 2025, the Company established and approved the relevant performance conditions for the Performance‑Based Awards and, as a result, the awards were considered granted for accounting purposes. Beginning in the quarter ended November 30, 2025, the Company commenced recognition of stock‑based compensation expense based on the grant‑date fair value of the Performance‑Based Awards, which was recognized over the remaining requisite service period. Because the Performance‑Based Elective Settlement Award had a fixed monetary value and was settleable in a variable number of shares, it was classified as a liability within the Consolidated Statements of Financial Position. The Performance‑Based RSUs are classified as equity awards and are reflected within stockholders’ equity. 

 

During the three months ended August 31, 2026, following the conclusion of the measurement period on May 31, 2026 and the determination of the applicable achievement percentage, the Compensation Committee approved settlement of the Performance-Based Elective Settlement Award through a combination of cash and shares. Accordingly, the Company issued 1,387,047 shares of common stock during the period and settled the remaining obligation in cash subsequent to August 31, 2026.

 

The Company’s total stock-based compensation expense incurred for the three months ended August 31, 2026 was $6,584 compared to $5,052 for the three months ended August 31, 2025. 

 

Prior year share amounts have been retrospectively adjusted to reflect the Reverse Stock Split, which became effective on December 2, 2025.