Share Issuance and Stock Structure - The company may issue up to 10,000,000 additional shares under the 2023 Equity Incentive Plan, with 6,943,442 unissued shares authorized as of April 10, 2025[195]. - The company entered into a SEPA with Yorkville to purchase up to $100 million of Common Stock, with conditions including the absence of outstanding amounts on Yorkville Promissory Notes[200]. - As of the date of the report, the company issued 6,096,797 shares of Common Stock to Yorkville under a registration statement effective on September 26, 2024[204]. - The company has filed a registration statement to register 25 million shares of Common Stock for resale by Yorkville under the SEPA[204]. - The company has a dual class structure that may affect the market price of Class A Common Stock and could lead to exclusion from certain indices[206]. - The company is classified as a "controlled company," allowing it to opt out of certain corporate governance requirements, which may affect investor attractiveness[207]. Market Price and Shareholder Impact - The market price of the company's Common Stock is currently below $10.00 per share, which was the price per unit sold in the IPO[199]. - The resale of a substantial number of shares could adversely affect the market price of Common Stock, particularly if large shareholders sell their holdings[198]. - The company has the right to control the timing and amount of any sales of shares of Common Stock to Yorkville under the SEPA, depending on market conditions[201]. Warrants and Redemption - The company has outstanding warrants to purchase a total of 3,000,000 shares of Class A Common Stock at various exercise prices ranging from $1.83 to $575.00 per share[214]. - The Public Warrants can be redeemed at a price of $0.01 per warrant if the Class A Common Stock price exceeds $18.00 per share for a specified trading period[218]. - The GEM Warrant is not redeemable and can be exercised on a cash or cashless basis, potentially resulting in no cash proceeds for the company[215]. - The company may amend the terms of the Public Warrants with the approval of at least 50% of the holders, which could adversely affect the holders[216]. - The company has the ability to redeem unexpired Public Warrants at any time after they become exercisable, which may disadvantage warrant holders[218]. - The exercise of the warrants is highly dependent on the market price of the Class A Common Stock relative to the exercise prices[214]. - The company has no obligation to notify holders of the Public Warrants about their eligibility for redemption, but must provide a 30-day notice if redemption is decided[219]. - The company has outstanding warrants that may expire worthless if not exercised, depending on market conditions[214]. - The exercise prices of the warrants range from $1.83 to $575.00, with significant variations in the number of shares purchasable[214]. Regulatory and Legal Considerations - The exclusive forum clause in the Warrant Agreement may limit investors' rights to bring legal action, potentially affecting the company's legal exposure[209]. - The company is classified as a smaller reporting company, and thus certain market risk disclosures are not applicable[444].
Banzai International(BNZI) - 2024 Q4 - Annual Report