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Stockholders’ Deficiency
 12 Months Ended
Dec. 31, 2024
Equity [Abstract]  
Stockholders’ Deficiency

20. Stockholders’ Deficiency

 

Common Stock

 

Common Stock Purchase Agreement – On August 19, 2024, in connection with the Amended Promissory Note, the Company and Simplify entered into a Common Stock Purchase Agreement, where $15,000 of outstanding indebtedness under the Simplify Loan was exchanged for 17,797,817 shares of the Company’s common stock at a purchase price of approximately $0.84 per share, based on a 60-day volume weighted-average price of the Company’s common stock, which approximated the trading price on August 19, 2024, as reflected on the consolidated statements of stockholders’ deficiency. Further information is provided in Note 24.

 

Common Stock Private Placement – On February 14, 2024, the Company entered into a subscription agreement (the “Subscription Agreement”) with Simplify, pursuant to which the Company agreed to sell and issue to Simplify in a private placement (the “Private Placement”) an aggregate of 5,555,555 shares (the “Private Placement Shares”) of the Company’s common stock, at a purchase price of $2.16 per share, a price equal to the 60-day volume weighted average price of the Company’s common stock. The Private Placement closed on February 14, 2024 and the Company received proceeds from the Private Placement of $12,000 as reflected on the condensed consolidated statements of stockholders’ deficiency. The proceeds were used for working capital and general corporate purposes. Further information is provided in Note 24.

 

 

Restricted Stock Units – The Company issued, in connection with the vesting of restricted stock units, 971,863 and 429,528 shares of the Company’s common stock (as described in Note 21) during the years ended December 31, 2024 and 2023, respectively, as reflected on the consolidated statements of stockholders’ deficiency.

 

Common Stock Withheld – The Company recorded the repurchase of vested restricted common stock of 330,982 shares for the payment for taxes of $534, and 202,382 shares for the payment for taxes of $1,423, during the years ended December 31, 2024 and 2023, respectively, as reflected on the consolidated statements of stockholders’ deficiency.

 

Common Stock for Series H Preferred Stock – During the year ended December 31, 2023, the Company recorded the issuance of 1,981,128 (of which 1,759,224 were issued in accordance with the automatic mandatory conversion) shares of common stock upon conversion of 14,356 (of which 12,748 were issued were issued in accordance with the automatic mandatory conversion) shares of Series H Preferred Stock, with a corresponding amount of $13,008 (representing 14,356 shares of Series H Preferred Stock at $1,000 stated par value per share, less issuance cost of $1,348), as reflected on the consolidated statements of stockholders’ deficiency.

 

Common Stock Registered Direct Offering – On March 31, 2023, the Company entered into common stock purchase agreements with certain purchasers, pursuant to which the Company issued and sold in a registered direct offering an aggregate of 2,963,918 shares of the Company’s common stock, at a purchase price of $3.88 per share. The gross proceeds received were $11,500 and after deducting offering expenses of $356, the Company received net proceeds of $11,144, as reflected on the consolidated statements of stockholder’s deficiency. No underwriter or placement agent participated in the registered direct offering. Further information is provided in Note 24.

 

Common Stock for Acquisitions – During the year ended December 31, 2023, the Company recorded the issuance of 274,692 shares of the Company’s common stock, as reflected on the consolidated statements of stockholders’ deficiency pursuant to the Fexy Studios asset acquisition on January 11, 2023, with a fair value of $2,000 on the transaction closing date, as further described in Note 4.

 

Common Stock for Liquidated Damages – During the year ended December 31, 2023, the Company entered into several stock purchase agreements with an investor where it was liable for liquidated damages, pursuant to which the Company issued 47,252 shares of its common stock to the investor in lieu of an aggregate of $499 owed in liquidated damages as of the conversion date, where the Company recorded $369 in connection with the issuance of shares of the Company’s common stock and a gain of $130 on the settlement of the liquidated damages, both as reflected in additional paid-in capital, totaling $499, which was recorded as additional paid-in capital on the consolidated statements of stockholders’ deficiency.

 

Exercise of Stock Options – During the year ended December 31, 2023, the Company recorded the exercise of 795 common stock options for shares of the Company’s common stock for cash of $0, as reflected on the consolidated statements of stockholders’ deficiency.

 

Common Stock to be Issued – During the year ended December 31, 2023, in connection with the Say Media merger on December 12, 2018, the Company issued 38,582 shares of the Company’s common stock, which were required to be issued as of January 1, 2022.

 

Restricted Stock Awards

 

Unless otherwise stated, the fair value of a restricted stock award is determined based on the number of shares granted and the quoted price of the Company’s common stock on the date issued. The estimated fair value of these shares is being recognized as compensation expense over the vesting period of the award (see Note 21).

 

Common Stock to be Issued

 

In connection with a closing of a private placement on January 4, 2018, MDB, as the placement agent, was entitled to receive 2,701 shares of the Company’s common stock (subject to liquidated damages, see Note 14), which have not been issued as of December 31, 2024, as reflected on the consolidated statements of stockholders’ deficiency as common stock to be issued (see Note 14).

 

 

Common Stock Warrants

 

Warrants were issued to purchase shares of the Company’s common stock in connection with various financings, all of which have expired.

 

As of December 31, 2024, the Company had outstanding warrants to purchase 39,774 shares of common stock, all of which are currently exercisable. These warrants were issued in connection with financing activities and have a weighted-average exercise price of $7.26 per share. The warrants are set to expire on October 20, 2025, resulting in a weighted-average remaining contractual life of approximately 0.80 years.

 

There was no intrinsic value of exercisable but unexercised in-the-money financing warrants based on a fair market value of the Company’s common stock of $1.34 per share on December 31, 2024.

 

AllHipHop Warrants – On October 26, 2020, the Company granted AllHipHop, LLC an aggregate of 5,682 warrants for shares of the Company’s common stock with an exercise price of $14.30 (the “AllHipHop Warrants”). The AllHipHop Warrants are exercisable for a period of five years, subject to customary anti-dilution adjustments, and may be exercised on a cashless basis.

 

ABG Warrants – On June 14, 2019, the Company issued 999,540 warrants to acquire the Company’s common stock to ABG (the “ABG Warrants”) in connection with the Sports Illustrated Licensing Agreement, expiring in ten years. The warrants provided time-based vesting in equal monthly increments over a period of two years beginning on the one year anniversary of the date of issuance of the warrants, of which 399,816 are vested as of December 31, 2024 (the “Time-Based Warrants”). Further details are provided under the heading ABG Warrants in Note 21, and performance based vesting based on the achievement of certain performance goals for the licensed brands in calendar years 2020, 2021, 2022, or 2023 (the “Performance-Based Warrants”), of which 599,724 vested of December 31, 2024, further details are provided under the heading ABG Warrants in Note 23 and in Note 29. The warrants also provide that (1) under certain circumstances the Company may require ABG to exercise all (and not less than all) of the warrants, in which case all of the warrants will be vested; (2) all of the warrants automatically vest upon certain terminations of the Licensing Agreement by ABG or upon a change of control of the Company; and (3) ABG has the right to participate, on a pro-rata basis (including vested and unvested warrants, exercised or unexercised), in any future equity issuance of the Company (subject to customary exceptions). As of December 31, 2024, 399,816 Time-Based Warrants and 599,724 Performance-Based Warrants are vested (further details are provided under the heading ABG Warrants in Note 21).

 

Information with respect to stock-based compensation cost and unrecognized stock-based compensation cost related to the ABG Warrants is provided in Note 21.

 

Publisher Partner Warrants – On May 20, 2020, the Board approved a third publisher partner warrant program, which superseded the second publisher partner warrant program and authorized the Company to grant publisher partner warrants to purchase up to 90,910 shares of the Company’s common stock (the “Publisher Partner Warrants”). The issuance of the Publisher Partner Warrants is administered by management and approved by the Board.

 

New Publisher Partner Warrants – On November 2, 2022, the Board approved a warrant incentive program to grant warrants to certain publishers (the “New Publisher Partner Warrants”), that authorized the Company to grant New Publisher Partner Warrants to purchase up to 33,000 shares of the Company’s common stock. The New Publisher Partner Warrants will have the following terms: (i) one-third will become exercisable and vest on the one-year anniversary of the issuance; (ii) the remaining warrants will become exercisable and vest in a series of twenty-four (24) successive equal monthly installments following the first anniversary of the issuance; and (iii) a five-year term. The issuance of the New Publisher Partner Warrants is administered by management and approved by the Board.

 

Information with respect to stock-based compensation cost and unrecognized stock-based compensation cost related to the New Publisher Partner Warrants is provided in Note 21.