EQUITY

3 Months Ended

Mar. 31, 2020

13. EQUITY

Preferred Stock

5,000,000 shares of Preferred Stock were authorized as at March 31, 2020 and December 31, 2019.

One share of Series A Convertible Preferred Stock (the "Series A Preferred Share") was issued and outstanding as at March 31, 2020 and December 31, 2019. Pursuant to the Certificate of Designation of the Series A Preferred Share, the Series A Preferred Share is convertible into 11,211,449 shares of Class A common stock on the date that is 61 days after the date on which the ownership of our outstanding shares of Class A common stock by a group that includes TW Investor and its affiliates would not be greater than 49.9%. The Series A Preferred Share is entitled to one vote per each share of Class A common stock into which it is convertible and has such other rights, powers and preferences, including potential adjustments to the number of shares of Class A common stock to be issued upon conversion, as are set forth in the Certificate of Designation.

200,000 shares of Series B Preferred Shares were issued and outstanding as at March 31, 2020 and December 31, 2019 (see Note 12, "Convertible Redeemable Preferred Shares"). As of March 31, 2020, the 200,000 Series B Preferred Shares were convertible into approximately 111.1 million shares of Class A common stock.

Class A and Class B Common Stock

440,000,000 shares of Class A common stock and 15,000,000 shares of Class B common stock were authorized as at March 31, 2020 and December 31, 2019. The rights of the holders of Class A common stock and Class B common stock are identical except for voting rights. The shares of Class A common stock are entitled to one vote per share and the shares of Class B common stock are entitled to ten votes per share. Shares of Class B common stock are convertible into shares of Class A common stock on a one-for-one basis for no additional consideration and automatically convert into shares of Class A common stock on a one-for-one basis when the number of shares of Class B common stock is less than 10% of the total number of shares of common stock outstanding. Holders of each class of shares are entitled to receive dividends and upon liquidation or dissolution are entitled to receive all assets available for distribution to holders of our common stock. Under our Bye-laws, the holders of each class have no pre-emptive or other subscription rights and there are no redemption or sinking fund provisions with respect to such shares.

There were 254.3 million and 253.6 million shares of Class A common stock outstanding at March 31, 2020 and December 31, 2019, respectively, and no shares of Class B common stock outstanding at March 31, 2020 or December 31, 2019.

As at March 31, 2020, TW Investor owns 63.8% of the outstanding shares of Class A common stock. In April 2018, Warner Media and TW Investor issued standing proxies to the independent directors of the Company, pursuant to which they granted the right to vote approximately 100.9 million shares of Class A common stock (the “Warrant Shares”) on all matters other than at any meeting where the agenda includes a change in control transaction. In accordance with these proxies, the Warrant Shares will be voted in proportion to votes cast at a general meeting of the Company, excluding such Warrant Shares. Warner Media and TW Investor have notified the Company that they intend to utilize their option to maintain this proxy arrangement in effect until April 2021. As a result of the standing proxies, after giving effect to its ownership of the Series A Preferred Share, TW Investor has a 44.1% voting interest in the Company.

Accumulated Other Comprehensive Loss

The movement in accumulated other comprehensive loss during the three months ended March 31, 2020 and 2019 comprised the following:



	For the Three Months Ended March 31,
	2020			2019
BALANCE, beginning of period	$	(226,916	)	$	(216,650	)

Currency translation adjustment, net
Balance, beginning of period	$	(213,955	)	$	(207,668	)
Foreign exchange loss on intercompany loans ⁽¹⁾	(18,074		)	(612		)
Foreign exchange loss on the Series B Preferred Shares	(6,750		)	(5,106		)
Currency translation adjustments	(36,399		)	(10,262		)
Balance, end of period	$	(275,178	)	$	(223,648	)

Unrealized loss on derivative instruments designated as hedging instruments
Balance, beginning of period	$	(12,961	)	$	(8,982	)
Change in the fair value of hedging instruments	(219		)	(3,702		)
Amounts reclassified from accumulated other comprehensive loss:
Changes in fair value of hedging instruments reclassified to interest expense	439			371
Balance, end of period	$	(12,741	)	$	(12,313	)

BALANCE, end of period	$	(287,919	)	$	(235,961	)

⁽¹⁾

Represents foreign exchange gains and losses on intercompany loans that are of a long-term investment nature which are reported in the same manner as translation adjustments.