XML 28 R16.htm IDEA: XBRL DOCUMENT v3.26.1
Preferred Shares
 6 Months Ended
Jun. 30, 2026
Class of Stock Disclosures [Abstract]  
Preferred Stock Preferred Shares
Series I Preferred Shares
On May 29, 2026, the Company filed articles of amendment to create a new series of preferred shares, being, an unlimited number of Series I Preferred Shares (the “Series I Preferred Shares”), and to provide for the rights, privileges, restrictions and conditions attaching thereto.
Holders of outstanding Series I Preferred Shares are entitled to receive dividends, subject to applicable law and the rights of the holders of Series H Preferred Shares, payable annually on June 1 of each applicable calendar year, or on the next business day if such date is not a business day and are noncumulative. Dividends are payable exclusively in additional Series I Preferred Shares (“PIK Shares”) at 8.0% per annum for the 36-month period following June 1, 2026. The number of Series I Preferred Shares issuable on each dividend payment date is calculated based on the number of Series I Preferred Shares held by the applicable holder on that date, rounded down to the nearest whole share. Holders of Series I Preferred Shares have no right to receive dividends after June 1, 2029.
Each share of Series I Preferred Shares (other than PIK Shares) is convertible into one common share of the Company on the following schedule: (x) up to 33-1/3% of such Series I Preferred Shares following the 12-month anniversary of June 1, 2026; (y) up to an aggregate of 66-2/3% of such Series I Preferred Shares following the 24-month anniversary of June 1, 2026; and (z) up to an aggregate of 100% of such Series I Preferred Shares following the 36-month anniversary of June 1, 2026, in each case, excluding any PIK Shares. PIK Shares are convertible into the Company’s common shares on a one-for-one basis on or after June 1, 2029.
The Company’s common shares rank junior to the Series I Preferred Shares in all respects (except as provided in connection with certain liquidation events described below). The Company’s Series H Preferred Shares rank senior to the Series I Preferred Shares. The Series I Preferred Shares carry no general voting rights, except for certain limited protective voting rights as expressly provided in the articles of amendment and as otherwise required by law.
The aggregate number of the Company’s common shares issuable upon conversion of the Series I Preferred Shares is subject to a cap (the “Exchange Cap”) equal to the maximum number of the Company’s common shares that may be issued upon such conversion without breaching its obligations under the rules of Nasdaq, unless the Company obtains shareholder approval for issuances in excess of such amount. The Exchange Cap is allocated pro rata among the holders of Series I Preferred Shares. The Company is not required under any circumstance to settle any conversion of the Series I Preferred Shares in cash and may settle any such conversion through the delivery of unregistered common shares.
If the Company’s Chief Executive Officer (“CEO”) ceases to be the CEO of the Company as a result of (i) a termination of his employment by the Company without cause, (ii) his resignation for good reason (as defined in his employment agreement with the Company), or (iii) his entry into a mutually agreed separation agreement with the Company, or if the CEO is not included on the Company's management slate of directors at any meeting of the Company's shareholders, then, effective upon such occurrence, each holder of Series I Preferred Shares may convert, in whole or in part and at any time thereafter, all of its Series I Preferred Shares, including all PIK Shares previously issued to such holder, into the Company’s common shares.
In the event of a voluntary or involuntary liquidation, dissolution or winding-up of the Company, holders of Series I Preferred Shares are entitled to receive, before any distribution to holders of the Company’s common shares or other junior shares, an amount per Series I Preferred Share equal to the greater of (i) the closing sale price of the Company’s common shares on the trading day immediately preceding such event and (ii) the amount such holder would have received had its Series I Preferred Shares been converted into common shares immediately prior to the liquidation event. After payment of such amounts, holders of Series I Preferred Shares and common shares are not entitled to share in any further distribution of assets of the Company in connection with such liquidation, dissolution or winding-up.
Until June 1, 2029, the Company may not, without the approval of the holders of a majority of the then outstanding Series I Preferred Shares: (1) make any return of capital in respect of shares ranking junior to the Series I Preferred Shares (unless holders of Series I Preferred Shares participate on an equal and proportionate basis with the holders of common shares), or (2) make any return of capital in respect of shares ranking equal with the Series I Preferred Shares (unless holders of Series I Preferred Shares participate on an equal and proportionate basis with the holders of common shares). These restrictions do not limit the Company's ability to redeem or repurchase common share purchase warrants or other securities convertible into or exchangeable for the Company’s common shares.
Series H Preferred Shares
On October 1, 2021, the Company filed articles of amendment to create a series of preferred shares, being, an unlimited number of Series H Preferred Shares and to provide for the rights, privileges, restrictions and conditions attaching thereto. The Series H Preferred Shares are convertible into 14.286 common shares for every Series H Preferred Share. Each holder of the Series H Preferred Shares, may, subject to prior shareholder approval, convert all or any part of the Series H Preferred Shares provided that after such conversion the common shares issuable, together with all the common shares held by the shareholder in the aggregate would not exceed 9.99% of the total number of outstanding common shares of the Company. Each Series H Preferred Share has a stated value of $1,000. The Series H Preferred Shares are non-voting and do not accrue dividends. Features of the Series H Preferred Shares include; in the event of the liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, deemed liquidation or any other distribution of the assets of the Company among its shareholders for the purpose of winding-up its affairs, the Series H Preferred Shares shall entitle each of the holders thereof to receive an amount equal to the Series H subscription price per Series H Preferred Share, as defined in the agreement, to be paid before any amount is paid or any assets of the Company are distributed to the holders of its common shares.
In accordance with the authoritative guidance for distinguishing liabilities from equity, the Company has determined that its Series H preferred shares carry certain redemption features beyond the control of the Company. Accordingly, the Series H Preferred Shares are presented as temporary equity.