DMC Global公佈截至2026年6月季度業績

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.  20549
Form 10-Q
 
☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2026
OR
☐         TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ______ TO ______
Commission file number 001-14775

 DMC GLOBAL INC.
(Exact name of Registrant as Specified in its Charter)
Delaware
 84-0608431

(State of Incorporation or Organization) (I.R.S. Employer Identification No.)

11800 Ridge Parkway, Suite 300, Broomfield, Colorado 80021
(Address of principal executive offices, including zip code)
 
(303) 665-5700
(Registrant’s telephone number, including area code)
 

Title of each classTrading SymbolName of exchange on which registered
Common Stock, $0.05 Par Value
BOOMThe Nasdaq Global Select Market
Stock Purchase RightsThe Nasdaq Global Select Market

Indicate by check mark whether the registrant:  (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☑ No  ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  ☑  No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐
 Accelerated filer  ☑

Non-accelerated filer ☐
 Smaller reporting company ☐

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act  ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 under the Act).  Yes  ☐  No ☑
The number of shares of Common Stock outstanding was 20,540,949 as of July 22, 2026.

CAUTIONARY NOTE ABOUT FORWARD-LOOKING STATEMENTS
This quarterly report on Form 10-Q contains “forward-looking statements” within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend the forward-looking statements throughout this quarterly report on Form 10-Q to be covered by the safe harbor provisions for forward-looking statements. Statements contained in this report which are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from projected results. These statements can sometimes be identified by our use of forward-looking words such as “may,” “believe,” “plan,” “anticipate,” “estimate,” “expect,” “intend,” “seek,” and other phrases of similar meaning. Such statements include, but are not limited to, expectations regarding the impact of volatility of energy markets, the conflict between the United States, Israel, and Iran and related geopolitical instability, evolving global tariff policies on sales and profitability, tariff recoverability, market-responsive initiatives at Arcadia Products, cost reduction and market share expansion initiatives at DynaEnergetics, order activity improvements and shipment timing at NobelClad, market opportunities at NobelClad, our ability to access capital markets transactions in the future, our ability to redeem a newly designated series of preferred stock (if issued in connection with the right of the minority interest holder of Arcadia Products to sell its remaining interest in Arcadia Products to us), the availability of funds to support our liquidity position and our expected future liquidity position. The forward-looking information is based on information available as of the date of this quarterly report and on numerous assumptions and developments that are not within our control. Although we believe that our expectations as expressed in these forward-looking statements are reasonable, we cannot assure you that our expectations will turn out to be correct. Factors that could cause actual results to differ materially include, but are not limited to, those factors referenced in our Annual Report on Form 10-K for the year ended December 31, 2025 and this Quarterly Report on Form 10-Q and other potential factors, including: geopolitical and economic instability, including recessions or depressions; inflation; supply chain delays and disruptions; the availability and cost of energy; transportation disruptions; the ability to obtain new contracts at attractive prices; the size and timing of customer orders and shipments; product pricing and margins; our ability to realize sales from our backlog; fluctuations in customer demand; fluctuations in foreign currencies; competitive factors; the timely completion of contracts; the timing and size of expenditures; the timely receipt of government approvals and permits; the price and availability of metal, aluminum, and other raw materials; fluctuations in tariffs or quotas; changes in laws and regulations, both domestic and foreign, impacting our business and the business of the end-market users we serve; the adequacy of local labor supplies at our facilities; changes in immigration laws or enforcement programs; current or future limits on manufacturing capacity at our various operations; the impact of pending or future litigation or regulatory matters; the availability and cost of funds; our ability to access our borrowing capacity under our credit facility or access the capital markets; the actions of activist stockholders; global economic conditions; and wars, terrorism and armed conflicts. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis only as of the date hereof. We undertake no obligation to publicly release the results of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

TABLE OF CONTENTS

  Page
PART I - FINANCIAL INFORMATION

Item 1
Condensed Consolidated Financial Statements
4

   
 Condensed Consolidated Balance Sheets as of June 30, 2026 (unaudited) and December 31, 2025
4

 Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2026 and 2025 (unaudited)
5

 Condensed Consolidated Statements of Comprehensive (Loss) Income for the three and six months ended June 30, 2026 and 2025 (unaudited)
6

 Condensed Consolidated Statements of Stockholders’ Equity and Redeemable Noncontrolling Interest for the three and six months ended June 30, 2026 and 2025 (unaudited)
7

 Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2026 and 2025 (unaudited)
9

 Notes to Condensed Consolidated Financial Statements (unaudited)
10

   
Item 2
Management’s Discussion and Analysis of Financial Condition and Results of Operations
26

   
Item 3
Quantitative and Qualitative Disclosure about Market Risk
42

   
Item 4
Controls and Procedures
42

   
PART II - OTHER INFORMATION

   
Item 1
Legal Proceedings
43

   
Item 1A
Risk Factors
43

   
Item 2
Unregistered Sales of Equity Securities and Use of Proceeds
43

   
Item 5
Other Information
44

   
Item 6
Exhibits
45

   
 Signatures
45

3

Table of Contents

Part I - FINANCIAL INFORMATION

ITEM 1.  Condensed Consolidated Financial Statements

DMC GLOBAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in Thousands, Except Share and Per Share Data)

June 30, 2026December 31, 2025
(unaudited)
ASSETS  
Current assets:  
Cash and cash equivalents$28,551 $31,898 

Accounts receivable, net of allowance for doubtful accounts of $9,839 and $9,790, respectively
102,051 93,697 
Inventories167,309 144,552 
Prepaid expenses and other15,256 16,224 

Total current assets313,167 286,371 
Property, plant and equipment248,312 249,280 
Less - accumulated depreciation(127,208)(121,922)
Property, plant and equipment, net121,104 127,358 

Purchased intangible assets, net146,338 155,051 
Deferred tax assets211 833 
Other assets68,806 66,218 
Total assets$649,626 $635,831 

LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST, AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable$49,076 $48,188 
Accrued expenses14,173 12,375 

Accrued income taxes2,762 4,289 
Accrued employee compensation and benefits11,921 13,111 
Contract liabilities30,072 22,568 
Current portion of long-term debt3,750 3,438 
Other current liabilities10,776 10,356 

Total current liabilities122,530 114,325 
Long-term debt55,314 47,206 

Deferred tax liabilities412 475 
Other long-term liabilities46,940 44,695 
Total liabilities225,196 206,701 
Commitments and contingencies (Note 11)

Redeemable noncontrolling interest187,080 187,080 
Stockholders’ equity
Preferred stock, $0.05 par value; 4,000,000 shares authorized; no issued and outstanding shares
— — 
Common stock, $0.05 par value; 50,000,000 shares authorized; 21,559,103 and 21,497,468 shares issued, respectively
1,078 1,075 
Additional paid-in capital308,712 306,293 
Accumulated deficit
(19,010)(13,452)
Other cumulative comprehensive loss(25,820)(24,716)
Treasury stock, at cost, and company stock held for deferred compensation, at par; 1,018,154 and 979,334 shares, respectively
(27,610)(27,150)

Total stockholders’ equity237,350 242,050 
Total liabilities, redeemable noncontrolling interest, and stockholders’ equity$649,626 $635,831 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
4

Table of Contents
DMC GLOBAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Thousands, Except Share and Per Share Data)
(unaudited)

Three months ended June 30,Six months ended June 30,
 2026202520262025
Net sales$156,953 $155,487 $292,548 $314,777 
Cost of products sold122,598 118,756 232,750 236,847 
Gross profit34,355 36,731 59,798 77,930 
Costs and expenses:    
General and administrative expenses13,916 15,905 28,048 32,579 
Selling and distribution expenses10,625 10,242 21,097 21,868 
Amortization of purchased intangible assets4,357 4,763 8,713 9,526 

Strategic review and related expenses— 775 — 2,073 
Restructuring expenses and asset impairments239 1,149 805 1,474 

Total costs and expenses29,137 32,834 58,663 67,520 
Operating income5,218 3,897 1,135 10,410 
Other expense:    
Other income (expense), net15 (346)(30)(564)
Interest expense, net(1,280)(1,811)(2,741)(3,510)
Income (loss) before income taxes3,953 1,740 (1,636)6,336 
Income tax provision1,936 1,419 3,157 4,152 

Net income (loss)$2,017 $321 $(4,793)$2,184 
Less: Net income attributable to redeemable noncontrolling interest1,510 205 765 1,391 
Net income (loss) attributable to DMC Global Inc. stockholders$507 $116 $(5,558)$793 

Net income (loss) per share attributable to DMC Global Inc. stockholders:  
Basic$0.10 $(0.24)$(0.24)$(0.20)
Diluted$0.10 $(0.24)$(0.24)$(0.20)
Weighted average shares outstanding:    
Basic20,199,424 20,134,760 20,133,159 19,861,073 
Diluted20,235,822 20,134,760 20,133,159 19,861,073 

Reconciliation to net income (loss) attributable to DMC Global Inc. stockholders after adjustment of redeemable noncontrolling interest for purposes of calculating earnings per share

Three months ended June 30,Six months ended June 30,
2026202520262025
Net income (loss) attributable to DMC Global Inc. stockholders$507 $116 $(5,558)$793 
Adjustment of redeemable noncontrolling interest1,541 (4,900)806 (4,819)
Net income (loss) attributable to DMC Global Inc. stockholders after adjustment of redeemable noncontrolling interest$2,048 $(4,784)$(4,752)$(4,026)

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
5

Table of Contents
DMC GLOBAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME
(Amounts in Thousands)
(unaudited)

Three months ended June 30,Six months ended June 30,
 2026202520262025
Net income (loss)$2,017 $321 $(4,793)$2,184 

Change in cumulative foreign currency translation adjustment(563)3,478 (1,104)4,652 
Other comprehensive income (loss)$1,454 $3,799 $(5,897)$6,836 

Less: comprehensive income attributable to redeemable noncontrolling interest1,510 205 765 1,391 

Comprehensive (loss) income attributable to DMC Global Inc. stockholders$(56)$3,594 $(6,662)$5,445 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
6

Table of Contents
DMC GLOBAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND REDEEMABLE NONCONTROLLING INTEREST
(Amounts in Thousands, Except Share Data)
(unaudited)

     OtherTreasury Stock, at cost, andTotalRedeemable
   AdditionalAccumulated 
CumulativeCompany Stock Held forDMC Global Inc.Non-
 Common StockPaid-InComprehensive Deferred Compensation, at parStockholders’Controlling
 SharesAmountCapitalDeficit
LossSharesAmountEquityInterest
Balances, December 31, 202521,497,468 $1,075 $306,293 $(13,452)$(24,716)(979,334)$(27,150)$242,050 $187,080 
Net loss— — — (6,065)— — — (6,065)(745)
Change in cumulative foreign currency translation adjustment— — — — (541)— — (541)— 
Share activity in connection with stock compensation plans(15,061)(1)1 — — — — — — 
Stock-based compensation— — 853 — — — — 853 10 

Adjustment of redeemable noncontrolling interest— — (735)— — — — (735)735 
Treasury stock activity— — — — — (27,922)(367)(367)— 
Balances, March 31, 202621,482,407 $1,074 $306,412 $(19,517)$(25,257)(1,007,256)$(27,517)$235,195 $187,080 
Net income— — — 507 — — — 507 1,510 
Change in cumulative foreign currency translation adjustment— — — — (563)— — (563)— 
Share activity in connection with stock compensation plans76,696 4 (4)— — — — — — 
Stock-based compensation— — 763 — — — — 763 31 

Adjustment of redeemable noncontrolling interest— — 1,541 — — — — 1,541 (1,541)
Treasury stock activity— — — — — (10,898)(93)(93)— 
Balances, June 30, 202621,559,103 $1,078 $308,712 $(19,010)$(25,820)(1,018,154)$(27,610)$237,350 $187,080 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
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DMC GLOBAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND REDEEMABLE NONCONTROLLING INTEREST
(Amounts in Thousands, Except Share Data)
(unaudited)

     OtherTreasury Stock, at cost, andTotalRedeemable
   Additional CumulativeCompany Stock Held forDMC Global Inc.Non-
 Common StockPaid-InRetainedComprehensiveDeferred Compensation, at parStockholders’Controlling
 SharesAmountCapitalEarningsLossSharesAmountEquityInterest
Balances, December 31, 202421,083,184 $1,054 $305,460 $— $(29,560)(820,322)$(25,983)$250,971 $187,080 
Net income— — — 677 — — — 677 1,186 
Change in cumulative foreign currency translation adjustment— — — — 1,174 — — 1,174 — 
Share activity in connection with stock compensation plans
319,846 16 (13)— — (59,796)(3)— — 
Stock-based compensation— — 1,504 — — — — 1,504 95 
Distribution to redeemable noncontrolling interest holder— — — — — — — — (1,200)
Adjustment of redeemable noncontrolling interest— — — 81 — — — 81 (81)
Treasury stock activity— — — — — (32,190)(484)(484)— 
Balances, March 31, 202521,403,030 $1,070 $306,951 $758 $(28,386)(912,308)$(26,470)$253,923 $187,080 
Net income— — — 116 — — — 116 205 
Change in cumulative foreign currency translation adjustment— — — — 3,478 — — 3,478 — 
Share activity in connection with stock compensation plans84,779 4 (4)— — (8,356)— — — 
Stock-based compensation— — 1,322 — — — — 1,322 95 
Distribution to redeemable noncontrolling interest holder— — — — — — — — (5,200)
Adjustment of redeemable noncontrolling interest— — (4,026)(874)— — — (4,900)4,900 
Treasury stock activity— — — — — 14,124 (82)(82)— 
Balances, June 30, 202521,487,809 $1,074 $304,243 $— $(24,908)(906,540)$(26,552)$253,857 $187,080 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
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DMC GLOBAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in Thousands)
(unaudited)

Six months ended June 30,
 20262025
Cash flows from operating activities:  
Net (loss) income$(4,793)$2,184 
Adjustments to reconcile net (loss) income to net cash from operating activities: 

Depreciation7,303 7,367 
Amortization of purchased intangible assets8,713 9,526 
Amortization of deferred debt issuance costs472 448 

Stock-based compensation1,657 3,016 

Bad debt expense95 696 
Deferred income taxes559 414 
Asset impairments— 296 

Other, net
(576)988 
Change in:  
Accounts receivable, net(9,193)(4,854)
Inventories(23,444)10,716 
Prepaid expenses and other6,781 12,367 
Accounts payable1,882 (4,449)
Contract liabilities7,630 (11,415)

Accrued expenses and other liabilities(7,425)(7,566)
Net cash (used in) provided by operating activities(10,339)19,734 
Cash flows from investing activities:  

Acquisition of property, plant and equipment(3,384)(6,700)
Proceeds from property, plant and equipment reimbursements1,403 1,788 
Proceeds on sale of property, plant and equipment335 27 
Proceeds from settlement of note receivable— 4,167 
Net cash used in investing activities(1,646)(718)
Cash flows from financing activities:  

Repayments on term loan(1,562)(1,250)
Borrowings on revolving loans123,938 46,859 
Repayments on revolving loans(114,175)(57,887)

Payment of debt issuance costs— (650)
Distributions to redeemable noncontrolling interest holder— (6,255)

Treasury stock purchases(460)(563)

Net cash provided by (used in) financing activities7,741 (19,746)

Effects of exchange rates on cash897 (1,132)

Net decrease in cash and cash equivalents(3,347)(1,862)
Cash and cash equivalents, beginning of the period31,898 14,289 
Cash and cash equivalents, end of the period$28,551 $12,427 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
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DMC GLOBAL INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in Thousands, Except Share and Per Share Data)
(unaudited)

1.      BASIS OF PRESENTATION
The information included in the Condensed Consolidated Financial Statements is unaudited but includes all normal and recurring adjustments which, in the opinion of management, are necessary for a fair presentation of the interim periods presented. Certain information and footnote disclosures, including critical and significant accounting policies normally included in consolidated financial statements prepared in accordance with generally accepted accounting principles, have been condensed or omitted for this quarterly presentation. These Condensed Consolidated Financial Statements should be read in conjunction with the financial statements that are included in our Annual Report filed on Form 10-K for the year ended December 31, 2025.

2.      SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The Condensed Consolidated Financial Statements include the accounts of DMC Global Inc. (“DMC”, “we”, “us”, “our”, or the “Company”) and its controlled subsidiaries. All intercompany accounts, profits, and transactions have been eliminated in consolidation.
Accounts Receivable
The Company measures expected credit losses for its accounts receivable using a current expected credit loss model, which is based on historical experience, adjusted for current conditions and reasonable and supportable forecasts. The Company has disaggregated pools of accounts receivable balances by business, geography and/or customer risk profile and has used history and other experience to establish an allowance for credit losses at the time the receivable is recognized. To measure expected credit losses, we have elected to pool trade receivables by segment and analyze each segment’s accounts receivable balances as separate populations. Within each segment, receivables exhibit similar risk characteristics.
During the three and six months ended June 30, 2026, our expected loss rate reflects uncertainties in market conditions present in our businesses, including supply chain disruptions, continued volatility in oil and gas markets, elevated interest rates, as well as global geopolitical and economic instability. In addition, we reviewed receivables outstanding, including aged balances, and in circumstances where we are aware of a specific customer’s inability to meet its financial obligation to us, we recorded a specific allowance for credit losses against the amounts due, reducing the net receivable recognized to the amount we estimate will be collected. The offsetting expense is charged to “Selling and distribution expenses” in our Condensed Consolidated Statements of Operations. During the three and six months ended June 30, 2026, net provisions of $34 and $95, respectively, were recorded. During the three and six months ended June 30, 2025, net recoveries of $10 and net provisions of $696, respectively, were recorded.
The following table summarizes year-to-date activity in the allowance for credit losses on receivables from customers in each of our business segments:

Arcadia ProductsDynaEnergeticsNobelCladDMC Global Inc.
Allowance for doubtful accounts, December 31, 2025
$313 $9,445 $32 $9,790 

Current period provision for expected credit losses86 76 16 178 
Write-offs charged against the allowance(44)— — (44)
Recoveries of amounts previously reserved(15)(68)— (83)
Impacts of foreign currency exchange rates and other— (2)— (2)
Allowance for doubtful accounts, June 30, 2026
$340 $9,451 $48 $9,839 

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Contract Liabilities
At times, we require customers to make advanced payments prior to the shipment of their orders to help finance our inventory investment on large orders or keep customers’ credit limits at acceptable levels. Contract liabilities consisted of the following for the periods presented:
June 30, 2026December 31, 2025
Arcadia Products
$13,244 $9,073 
DynaEnergetics146 483 
NobelClad16,682 13,012 
Total$30,072 $22,568 

We generally expect to recognize the revenue associated with contract liabilities over a time period no longer than one year, but unforeseen circumstances can cause delays in shipments associated with contract liabilities, primarily supply chain delays and disruptions.
Redeemable Noncontrolling Interest
On December 23, 2021, DMC completed the acquisition of 60% of the membership interests in Arcadia Products, LLC, a Colorado limited liability company resulting from the conversion of Arcadia, Inc. (collectively, “Arcadia Products”). The limited liability company operating agreement for Arcadia Products (the “Operating Agreement”) contains a right for the Company to purchase the remaining interest in Arcadia Products from the minority interest holder on or after December 23, 2024 (“Call Option”). Similarly, the Operating Agreement originally permitted the minority interest holder of Arcadia Products the right to sell its remaining interest in Arcadia Products to the Company on or after December 23, 2024 (“Put Option”). On December 3, 2024, the Company and minority interest holder entered into an amendment to the Operating Agreement whereby the minority interest holder agreed not to exercise the Put Option until on or after September 6, 2026.
The purchase price for any interests sold pursuant to the Call Option or Put Option continues to be based upon a predefined calculation as included within the Operating Agreement. The calculation is based on a multiple of Arcadia Products’ adjusted EBITDA over a defined period or, if higher, a “Floor Value” for 100% of Arcadia Products equal to $467,700 (or $187,080 for the minority owner’s 40% interest), in each case subject to certain adjustments. In connection with an exercise of the Call Option, the Operating Agreement would require payment of the purchase price in cash. However, in connection with the exercise of the Put Option, the Operating Agreement permits the Company the option to pay the purchase price in either cash, or 20% in cash and 80% in shares of a newly designated series of preferred stock (the “Put Preferred”) that would be authorized at that time. The terms of the Put Preferred, including the rights, powers and preferences thereof, as set forth in the Operating Agreement, would be replicated in a Certificate of Designations to be filed with the Secretary of State of the State of Delaware.
The number of shares of Put Preferred to be issued in connection with the Put Option (if the Company utilizes that payment mechanism) would be initially determined and valued at the volume weighted average trading price of the Company’s common stock over the 60 days preceding the delivery of the Put Option notice. The Put Preferred would be entitled to dividends at a rate of 3% per annum and would vote with and be convertible into one share of the Company’s common stock. However, in order to comply with applicable Nasdaq rules, the voting and conversion rights of the Put Preferred would initially be limited to 19.9% of the number of shares of DMC common stock outstanding immediately prior to the issuance of the Put Preferred. This voting and conversion cap would be removed only if such removal is approved by DMC’s stockholders. The holder of the Put Preferred would not be allowed to participate in any such stockholder vote. Based on the purchase price definition set forth in the Operating Agreement and the current price of DMC common stock, it is likely that if the Put Preferred is issued, a stockholder vote to remove the voting and conversion cap would result in the minority interest holder acquiring majority voting control of the Company through the involuntary dilution of the existing stockholders.
Upon issuance, the Company may redeem the Put Preferred at any time; however, beginning on June 23, 2027, the Company would begin proportionate annual redemptions of the Put Preferred, provided that the Put Preferred must be redeemed by the third anniversary of its issuance, subject in all cases to the availability of sufficient funds to effect such redemptions as described below.
The Company’s ability to redeem the Put Preferred, including its ability to make the mandatory redemptions described above, is subject to certain statutory and common law limitations under Delaware law. Under Section 160(a) of the General Corporation Law of the State of Delaware (the “DGCL”), a corporation may not purchase or redeem its own shares of capital 
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stock when the capital of the corporation is, or as a result of such transaction would be, impaired. Further, the Delaware courts have stated that a corporation may not redeem shares if doing so “diminishes the ability of the company to pay its debts, or lessens the security of its creditors.” Accordingly, the Company may be restricted from making redemption payments if its capital is impaired, if making the payments would impair its capital or in other circumstances, including where the payment would threaten its ability to continue as a going concern.
In assessing whether the Company has funds legally available to redeem some or all of the Put Preferred, the Company’s board of directors (the “Board”) will be required to make a good faith determination, based upon available data and by methods that the Board reasonably believes reflect present values, as to whether the Company can meet the statutory surplus and common law requirements for each redemption. Such determination may include consideration of the fair value of the Company’s assets and liabilities, including any contingent liabilities discounted for probability and timing, the Company’s projected cash flows and liquidity needs. There can be no assurance that the Company will meet the Delaware statutory surplus and common law requirements to redeem the Put Preferred on the scheduled redemption dates. If the Company does not redeem the Put Preferred as contemplated by the Certificate of Designations because it lacks sufficient legally available funds to do so, Delaware case law indicates that (i) the Company will not be in default under the Certificate of Designations and (ii) the holder of the Put Preferred will not be able to exercise the remedies that would be available to a creditor in the case of a defaulted contractual obligation. In such an event, the Put Preferred, to the extent not redeemed or converted, would remain outstanding and would continue to accrue interest at 3% per annum until such time as the Company has sufficient fun