PREFERRED STOCK

9 Months Ended

Sep. 30, 2024

Equity [Abstract]

PREFERRED STOCK

PREFERRED STOCK

Our Series A Preferred Stock (the "Preferred Stock") is cumulative redeemable convertible preferred stock. Accordingly, it is classified as temporary equity and is shown net of issuance costs and the fair value of warrants issued in conjunction with the issuance of the Preferred Stock.

On May 15, 2024, in connection with the issuance of warrants and pursuant to our Certificate of Designations of Series A Convertible Preferred Stock, because we issued and sold warrants at a price less than the prior $10.0625 conversion price of our Preferred Stock, the conversion price of the Preferred Stock was adjusted to $9.65 per share. After this adjustment to the conversion price of the Preferred Stock and taking into account accrued dividends on the Preferred Stock as of May 15, 2024, the currently outstanding 600,000 shares of the Preferred Stock would convert into a total of 6,651,198 shares of Common Stock (adjusted from 5,962,733 as of on the original issue date of the Preferred Stock and adjusted from 6,378,540 as of immediately prior to the issuance of such warrants after taking into account such accrued dividends).

Undeclared dividend payments on our Preferred Stock totaled $2.2 million and $6.2 million, respectively, for the three and nine months ended September 30, 2024. As a result, the amounts were added to the carrying amount of the Series A Preferred Stock and the dividend rate is currently at 13% until such dividends are paid. Total undeclared and unpaid dividends were $7.4 million at September 30, 2024.

On November 15, 2024, the Company entered into preferred stock exchange agreements with the holders of the Company's outstanding Preferred Stock. See Note 15 - Subsequent Events to our Condensed Consolidated Financial Statements for additional information.