−Removed: For information regarding risk factors pertinent to the Company’s business please refer to Part I Item 1A of the Company’s 2023 Annual Report on Form 10-K, which was filed with the SEC on March 14, 2024 and is incorporated by reference herein, as further updated and supplemented by the risk factors set forth below.
+Added: For information regarding other risk factors pertinent to the Company’s business please refer to Part I Item 1A of the Company’s 2023 Annual Report on Form 10-K, which was filed with the SEC on March 14, 2024 and is incorporated by reference herein, as further updated and supplemented by the risk factors set forth below.
We may not be able to maintain a listing of our Class A common stock on Nasdaq Capital Market, or Nasdaq
Because our Class A common stock is listed on Nasdaq, we must meet certain financial and liquidity criteria to maintain such listing.
−Removed: At present, we are in the initial period of 180-day compliance period provided by Nasdaq relating to our failure to maintain the $1.00 minimum bid price requirement.
On February 29, 2024, we received a letter from the Listing Qualifications Department (the “Staff”) of the Nasdaq notifying us that based upon the closing bid price for the last 30 consecutive business days, we no longer meet the Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”).
−Removed: We have been provided an initial period of 180 calendar days, or until August 26, 2024, to regain compliance with the Bid Price Rule.
−Removed: If we are not in compliance with the Bid Price Rule by August 26, 2024, we will seek a second 180 calendar day period to regain compliance.
−Removed: As of the date of this filing, we have not had a closing bid price over $1.00 and there can be no assurance that we will regain compliance with the Bid Price Rule prior to August 26, 2024.
−Removed: While we believe that we satisfy the requirements for a second 180 calendar day compliance period, there can be no assurance that the additional compliance period will be granted, or that, if granted, we will be able to meet the Bid Price Rule within the extended compliance period.
+Added: We were provided an initial period of 180 calendar days, or until August 26, 2024, to regain compliance with the Bid Price Rule.
+Added: On August 27, 2024, Nasdaq advised us in writing that, while we had not regained compliance with the Bid Price Rule, we had been granted an additional 180 calendar day extension, or until February 24, 2025, to regain compliance with the Bid Price Rule.
+Added: As of the date of this filing, we have not had a closing bid price over $1.00 and there can be no assurance that we will regain compliance with the Bid Price Rule prior to the end of the additional 180 calendar day period, or February 24, 2025 or that we will otherwise maintain compliance with any of the other Nasdaq listing requirements.
We will continue to actively monitor the closing bid price of our Class A common stock and will evaluate available options, including , without limitation, seeking to effect a reverse stock split, in order to resolve the deficiency and regain compliance with the Bid Price Rule.
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In addition, our Board may determine that the cost of maintaining our listing on a national securities exchange outweighs the benefits of such listing.
−Removed: A delisting of our Class A common stock from Nasdaq may materially impair our stockholders’ ability to buy and sell our Class A common stock and could have an adverse effect on the market price of, and the efficiency of the trading market for, our Class A common stock.
+Added: A delisting of our Class A
+Added: common stock from Nasdaq may materially impair our stockholders’ ability to buy and sell our Class A common stock and could have an adverse effect on the market price of, and the efficiency of the trading market for, our Class A common stock.
In the event our stock is delisted from Nasdaq, whether by choice or otherwise, the delisting of our Class A common stock could significantly impair our ability to raise capital and stockholder value.
We have not complied with certain covenants, minimum liquidity and borrowing base requirements under the Credit Agreement and this could cause us to be unable to continue to operate as a going concern.
+Added: As of September 30, 2024, we owed $40.1 million to the Lender under our Credit Agreement.
As previously disclosed, we have been unable to comply with certain covenants under our Credit Agreement with the Lender.
Although, to date, we have been successful in obtaining forbearance agreements with respect to these matters and avoid defaults under the agreement, there can be no assurance that the lender will not declare an event of default and acceleration all of our obligations under the Credit Agreement in the event we are unable to get into full compliance with these covenants in the future.
−Removed: Most recently, we were not in compliance with the Senior Leverage Ratio financial covenant under our Credit Agreement at June 30, 2024.
−Removed: Because of the significant decreases in the required Senior Leverage Ratio within the next twelve months, our current forecast projects that we may not be able to maintain compliance with this ratio.
+Added: Most recently, we were not in compliance with the Senior Leverage Ratio financial covenant under our Credit Agreement at September 30, 2024 and our borrowing base covenant under the Credit Agreement for the month ended October 31, 2024.
+Added: Because of the significant decreases in the required Senior Leverage Ratio that have occurred within the past twelve months, our current forecast projects that we may not be able to maintain compliance with this ratio.
These conditions raise substantial doubt about our ability to continue as a going concern within one year after the date that the financial statements are issued.
−Removed: In view of this matter, continuation as a going concern is dependent upon our ability to continue to achieve positive cash flow from operations, obtain waivers or other relief under the Credit Agreement for any future non-compliance with the Senior Leverage Ratio, or refinance our Credit Agreement with a different lender on a basis with more favorable terms.
−Removed: Our ability to refinance our existing debt is based upon credit markets and economic forces that are outside of our control.
−Removed: There can be no assurance that we will be successful in refinancing our debt, or on terms acceptable to us
+Added: In view of these matters, continuation as a going concern is dependent upon our ability to continue to achieve positive cash flow from operations, obtain waivers or other relief under the Credit Agreement for any future non-compliance with the Senior Leverage Ratio, borrowing base requirements or any other covenants or requirements under the Credit Agreement, or refinance our Credit Agreement with a different lender.
+Added: Furthermore, in the event the Lender refuses to grant forbearance to avoid a future default, the Lender might accelerate our obligations under the Credit Agreement.
+Added: In order to satisfy such obligations, we would similarly have to refinance our obligations or seek additional capital.
+Added: Our ability to refinance our existing debt is based upon credit markets and economic forces, whether on acceptable terms or at all, that are outside of our control.
+Added: There can be no assurance that we will be successful in refinancing our debt or raising additional capital, whether on acceptable terms, or at all.
+Added: Furthermore, if we were attempting to refinance our obligations or raise capital in response to an imminent or declared acceleration and default, we might have to do so on an expedited basis, which might further jeopardize our ability to successfully refinance or obtain capital.
+Added: In the event we fail in any of the efforts described in the preceding sentences, our business may materially suffer or even cease operations.
+Added: If the holders of our Series B Preferred Stock were to redeem their shares, we may not be able to pay the redemption price .
+Added: On September 25, 2020, the Company issued 1,586,620 shares of Series B Preferred Stock.
+Added: To the extent not previously converted into the Company’s Class A common stock, the outstanding shares of Series B Preferred Stock are redeemable at the option of the holders at any time or from time to time commencing on January 1, 2024, upon 30 days prior written notice from the holders, for a redemption price, payable in cash, of $10.00 per share being redeemed plus all accrued and unpaid dividends on such redeemed shares.
+Added: If all unconverted shares of Series B Preferred Stock were redeemed on September 30, 2024, the total amount payable by the Company would be $15.9 million.
+Added: If the holders of Series B Preferred Stock were to give notice of redemption, there is no guarantee that the Company would be able to satisfy the redemption price.
+Added: Assuming it were unable to, the Company might have to seek additional capital (including through the incurrence of additional indebtedness, issuance of securities or sale of assets outside the ordinary course).
+Added: There is no guarantee that the Company would be able to obtain such additional capital on acceptable terms, or at all.
+Added: Moreover, redemption of the Series B Preferred Stock might cause a default under the Credit Agreement, and efforts to satisfy it might be effectively prohibited by covenants under the Credit Agreement.
+Added: The Company’s failure to be able to timely satisfy any redemption of the Series B Preferred Stock, and other follow-on consequences of such failure, could materially negative affect the Company, including jeopardizing its ability to continue as a going concern.
+Added: The Company’s Series C Preferred Stock is subject to redemption by the holder starting January 1, 2026, so it is possible the risk of a non-payable redemption price could increase in the future.
UNREGISTERED SALES OF EQUITY SECURITIES, USE OF PROCEEDS AND ISSUER PURCHASE OF EQUITY SECURITIES
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.