XML 30 R12.htm IDEA: XBRL DOCUMENT v3.22.4
Stockholders’ Equity
 9 Months Ended
Dec. 31, 2022
Stockholders' Equity Note [Abstract]  
STOCKHOLDERS’ EQUITY

4. STOCKHOLDERS’ EQUITY

 

COMMON STOCK

 

Authorized Common Stock

 

As of December 31, 2022, the number of shares of Common Stock authorized for issuance was 275,000,000 shares.

 

During the three months ended December 31, 2022, the Company issued 908,383 shares of Common Stock. This is comprised of 224,359 shares in payment of preferred stock dividends and 684,024 restricted shares issued in connection with Board of Director compensation.

 

During the nine months ended December 31, 2022, the Company issued 3,595,895 shares of Common Stock. This is comprised of 510,955 shares in payment of preferred stock dividends, 2,750,903 shares issued on August 18, 2022 in connection with the vesting of grants pursuant to the 2017 Equity Incentive Plan, and 334,037 shares issued in payment of the Bloody Disgusting earnout commitment.

 

During the nine months ended December 31, 2021, we issued 8,642,648 shares of Common Stock which consist of the sale of shares of our Class A common stock, issuance of Common Stock for business combination, the issuances of Common Stock in payment of preferred stock dividends and in payment of Board of Director retainer fees.

 

PREFERRED STOCK

 

Cumulative dividends in arrears on preferred stock were $0.1 million as of December 31, 2022 and 2021. In May, June and November 2022, we paid preferred stock dividends in arrears in the form of 510,955 shares of Class A Common Stock.

 

TREASURY STOCK

 

We have treasury stock, at cost, consisting of 1,315,851 shares of Common Stock at December 31, 2022 and March 31, 2022.

 

EQUITY INCENTIVE PLANS

 

Stock Based Compensation Awards

 

Awards issued under our 2000 Equity Incentive Plan (the “2000 Plan”) may be in any of the following forms (or a combination thereof) (i) stock option awards; (ii) SARs; (iii) stock or restricted stock or restricted stock units; or (iv) performance awards. The 2000 Plan provides for the granting of incentive stock options (“ISOs”) with exercise prices not less than the fair market value of our Common Stock on the date of grant. ISOs granted to shareholders having more than 10% of the total combined voting power of the Company must have exercise prices of at least 110% of the fair market value of our Common Stock on the date of grant. ISOs and non-statutory stock options granted under the 2000 Plan are subject to vesting provisions, and exercise is subject to the continuous service of the participant. The exercise prices and vesting periods (if any) for non-statutory options are set at the discretion of our compensation committee. On November 1, 2017, upon the consummation of the initial equity investment in Cinedigm by Bison, as a result of which there was a change of control of the Company, all stock options (incentive and non-statutory) and shares of restricted stock were vested immediately and the options became fully exercisable.

 

In connection with the grants of stock options and shares of restricted stock under the 2000 Plan, we and the participants have executed stock option agreements and notices of restricted stock awards setting forth the terms of the grants. The 2000 Plan provided for the issuance of up to 2,380,000 shares of Common Stock to employees, outside directors and consultants.

 

Options outstanding and exercisable under the 2000 Plan are as follows:

 

 

 

As of December 31, 2022:

 

Range of Prices

 

Options
Outstanding and
Exercisable

 

 

Weighted Average
Remaining Life in
Years

 

 

Weighted Average
Exercise Price

 

 

Aggregate
Intrinsic Value
(In thousands)

 

$1.16 - $7.40

 

 

5,000

 

 

 

2.50

 

 

$

7.40

 

 

$

—

 

$13.70 - $24.40

 

 

207,037

 

 

 

0.78

 

 

 

14.63

 

 

 

—

 

 

 

 

212,037

 

 

 

0.82

 

 

$

14.46

 

 

$

—

 

 

 

 

As of March 31, 2022:

 

Range of Prices

 

Options
Outstanding and
Exercisable

 

 

Weighted Average
Remaining Life in
Years

 

 

Weighted Average
Exercise Price

 

 

Aggregate
Intrinsic Value
(In thousands)

 

$7.40

 

 

5,000

 

 

 

3.25

 

 

$

7.40

 

 

$

—

 

$14.00 - $24.40

 

 

212,337

 

 

 

1.50

 

 

 

14.65

 

 

 

—

 

 

 

 

217,337

 

 

 

1.54

 

 

$

14.49

 

 

$

—

 

 

In August 2017, the Company adopted the 2017 Equity Incentive Plan (the “2017 Plan). The 2017 Plan replaced the 2000 Plan, and applies to employees and directors of, and consultants to, the Company. The 2017 Plan provides for the issuance of up to 18,098,270 shares of Common Stock, in the form of various awards, including stock options, SARs, restricted stock, restricted stock units, PSUs and cash awards.

 

SARs outstanding under the 2017 Plan are as follows:

 

 

 

As of December 31, 2022:

 

Range of Prices

 

SARs Outstanding

 

 

Weighted Average
Remaining Life in
Years

 

 

Weighted Average
Exercise Price

 

 

Aggregate
Intrinsic Value
(In thousands)

 

$0.33 - $0.74

 

 

8,650,000

 

 

 

8.61

 

 

$

0.56

 

 

$

—

 

$1.16 - $1.47

 

 

2,128,277

 

 

 

6.55

 

 

 

1.39

 

 

 

—

 

$1.71 - $2.10

 

 

2,237,493

 

 

 

8.36

 

 

 

1.92

 

 

 

—

 

$2.23 - $2.56

 

 

455,583

 

 

 

8.81

 

 

 

2.28

 

 

 

—

 

 

 

 

13,471,353

 

 

 

 

 

 

 

 

$

—

 

 

 

 

As of March 31, 2022:

 

Range of Prices

 

SARs Outstanding

 

 

Weighted Average
Remaining Life in
Years

 

 

Weighted Average
Exercise Price

 

 

Aggregate
Intrinsic Value
(In thousands)

 

$0.54 - $0.74

 

 

5,550,000

 

 

 

8.74

 

 

$

0.62

 

 

$

1,208

 

$1.16 - $1.47

 

 

2,283,610

 

 

 

7.90

 

 

 

1.37

 

 

 

—

 

$1.71 - $2.10

 

 

2,455,738

 

 

 

8.91

 

 

 

1.97

 

 

 

—

 

$2.23 - $2.56

 

 

604,250

 

 

 

9.60

 

 

 

2.32

 

 

 

—

 

 

 

 

10,893,598

 

 

 

 

 

 

 

 

$

1,208

 

 

An analysis of all SARs exercisable under the 2017 Plan as of December 31, 2022 is presented below:

 

SARs Exercisable

 

 

Weighted Average
Remaining Life in
Years

 

 

Weighted Average
Exercise Price

 

 

Aggregate
Intrinsic Value
(In thousands)

 

 

5,448,345

 

 

 

7.75

 

 

$

1.13

 

 

$

—

 

 

Total SARs outstanding are as follows:

 

 

 

Nine Months Ended December 31, 2022

 

SARs Outstanding - March 31, 2022

 

 

10,893,598

 

Issued

 

 

3,100,000

 

Forfeited

 

 

(522,245

)

Total SARs Outstanding - December 31, 2022

 

 

13,471,353

 

 

The following weighted average assumptions were used to estimate the fair value of SARs granted as follows:

 

 

 

Nine Months Ended December 31, 2022

 

Expected dividend yield

 

 

—

 

Expected equity volatility

 

 

111.89

%

Expected term (years)

 

 

6.50

 

Risk-free interest rate

 

 

4.49

%

Exercise price

 

$

0.49

 

Market price per share

 

$

0.49

 

Weighted average fair value per SAR

 

$

0.43

 

 

The risk-free rates are based on the implied yield available on U.S. Treasury constant maturities with remaining terms equivalent to the respective expected terms of the options.

 

In addition, the Company has granted PSU awards under the 2017 Plan to employees. These awards vest upon certain performance goals being achieved as of March 31, 2022 and 2023 and can be settled in cash or equity upon vesting. During the three and nine months ended December 31, 2022, the Company issued 482,628 shares of common stock, net of 199,498 shares withheld to pay taxes, related to the vesting of 682,126 of PSU awards. As of December 31, 2022, there were 696,280 of PSU awards outstanding that vest as of March 31, 2023 subject to achieving certain performance goals. No additional PSU awards were granted during the three and nine months ended December 31, 2022. During the nine months ended December 31, 2022, 482,628 shares were issued for vested awards.

 

Employee and director stock-based compensation expense related to our stock-based awards was as follows (in thousands):

 

 

 

Three Months Ended
December 31,

 

 

Nine Months Ended
December 31,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Selling, general and administrative

 

$

708

 

 

$

1,349

 

 

$

3,906

 

 

$

3,278

 

 

There was $0.1 million of stock-based compensation expense for the three months ended December 31, 2022 and 2021, respectively, related to the Board. There was $0.3 million and $0.3 million of stock-based compensation for the nine months ended December 31, 2022 and 2021, respectively, related to Board of Directors compensation. During the nine months ended December 31, 2022, the Company issued 684,024 restricted shares to non-employee directors.

 

Options Granted Outside Cinedigm's Equity Incentive Plan

 

As of March 31, 2022, there were 12,500 options and 600,000 SARs granted to employees outside of Cinedigm's Equity Incentive Plan. During the three months ended December 31, 2022,100,000 SARs were granted as an inducement to a new employee.