- Helios and Matheson, the parent of MoviePass, is required to reserve millions of shares of stock as part of a series of debt agreements.
- The company’s creditors have agreed to reduce the number of shares it has to set aside.
- The move could free the company up to sell new shares to the public, something it’s done repeatedly to stay in business.
- However, the agreement came around the same time that the investment bank that has been selling shares on the company’s behalf announced it was cancelling their contract.
MoviePass’ parent company just gave itself more wriggle room to issue new shares — at the same time the partner it’s used to repeatedly sell new stock to shareholders cancelled their contract.
Helios and Matheson’s creditors have agreed to reduce the number of shares the company needs to set aside for notes it issued that can be converted into stock, the company said in a regulatory document filed with the Securities and Exchange Commission on Thursday. Additionally, the company essentially reached an agreement with its creditors to cancel a convertible note deal it agreed to in June, meaning it no longer has to set aside shares for that either.
“Following the consummation of the transactions contemplated by the [agreement], all of the June convertible notes have been cancelled,” the company said in the regulatory document.
The moves could breathe new life into MoviePass. Helios and Matheson has repeatedly sold new shares on the market to fund the movie ticket service’s ongoing losses. But last week it essentially warned that it had run out of room to issue new shares, thanks largely to the number of shares it had to set aside to cover its convertible notes.
Helios and Matheson reduced the shares it needs to reserve by 43%
Under the deals announced Thursday, the number of shares the company has to reserve for its debt fell by about 43%.
Previously, under the debt agreements it reached in November, January, and June, Helios and Matheson had to set aside twice as many shares as it was obligated to issue should its creditors choose to convert their notes into stock, according to its past regulatory filings. As of last week, it was obligated to keep in reserve 5.3 billion shares thanks to those terms, according to a proxy statement it filed with the SEC.
The problem for Helios and Matheson was that shareholders had only authorized it to issue 5 billion shares, and it already had nearly 1.4 billion shares outstanding before the convertible notes.
As part of the new deals, the company’s creditors dramatically reduced the number of shares it needs to keep in reserve for its notes. For its November notes, it now only needs to set aside the same number of shares that it’s obligated to issue if they are converted.
For its January notes, it now needs to set aside 125% of the shares it’s obligated to issue. And it now no longer has to set aside any shares for its June notes, because those have been replaced with non-convertible debt.
The company owes $20.4 million under the November notes, $29 million under the January notes, and $20.4 million under the June notes.
All told, the company now needs to set aside an estimated 3 billion shares. That gets it well under its 5 billion total share cap.
It has more room to sell shares — if it can find someone to sell them
And it could soon have plenty more room. It’s seeking authorization from shareholders to do a reverse split of its stock — the second in three months. The move, which goes before investors on October 18, could reduce the company’s share count to as little as one five-hundredth of its current total. Because the number of shares it’s authorized to issue wouldn’t be reduced by such a move, the split would dramatically increase the number of new shares it could issue.
But the company may have a tough time selling new stock to the public. In the same regulatory document it issued Thursday, it disclosed that Canaccord Genuity, the investment bank that had been selling its stock to the public on its behalf, has alerted it that its terminating their agreement as of October 11.
In April, Helios and Matheson announced that it would be selling up to $150 million worth of shares in dribs and drabs on the open market and had hired Canaccord to manage those sales. To date, it’s sold $126 million worth of stock under that authorization, the company disclosed in its regulatory filing Thursday. Canaccord’s cancellation of the agreement comes despite the fact that Helios and Matheson could still sell more stock under that plan — and plenty more under other authorizations.
“As a result of the termination of the Equity Distribution Agreement, no further offers or sales of the company’s common stock will be made pursuant to the company’s at-the-market offering,” Helios and Matheson said in the regulatory filing.
Representatives of Canaccord and Helios and Matheson did not respond to emails seeking an explanation for Canaccord’s move. The company could potentially sign a deal with another investment bank to sell its shares to the public.
Helios and Matheson has been contending with ongoing monthly losses in the tens of millions of dollars thanks to its money-losing subscription movie ticket service. It has funded those losses — and kept itself in business — by selling hundreds of millions of shares of its stock to the public.
The company’s share price fell largely in tandem with those massive stock sales. As it did, the number of shares the company had to set aside for its convertible notes went up in an inverse ratio.
Public officers above 58 years and with pre-existing conditions told to work from home: The Standard
Head of Public Service Joseph Kinyua. [File, Standard]
In a document from Head of Public Service, Joseph Kinyua new measure have been outlined to curb the bulging spread of covid-19. Public officers with underlying health conditions and those who are over 58 years -a group that experts have classified as most vulnerable to the virus will be required to execute their duties from home.
However, the new rule excluded personnel in the security sector and other critical and essential services.
“All State and public officers with pre-existing medical conditions and/or aged 58 years and above serving in CSG5 (job group ‘S’) and below or their equivalents should forthwith work from home,” read the document,” read the document.
To ensure that those working from home deliver, the Public Service directs that there be clear assignments and targets tasked for the period designated and a clear reporting line to monitor and review work done.
SEE ALSO: Thinking inside the cardboard box for post-lockdown work stations
Others measures outlined in the document include the provision of personal protective equipment to staff, provision of sanitizers and access to washing facilities fitted with soap and water, temperature checks for all staff and clients entering public offices regular fumigation of office premises and vehicles and minimizing of visitors except by prior appointments.
Officers who contract the virus and come back to work after quarantine or isolation period will be required to follow specific directives such as obtaining clearance from the isolation facility certified by the designated persons indicating that the public officer is free and safe from Covid-19. The officer will also be required to stay away from duty station for a period of seven days after the date of medical certification.
“The period a public officer spends in quarantine or isolation due to Covid-19, shall be treated as sick leave and shall be subject to the Provisions of the Human Resource Policy and procedures Manual for the Public Service(May,2016),” read the document.
The service has also made discrimination and stigmatization an offence and has guaranteed those affected with the virus to receive adequate access to mental health and psychosocial supported offered by the government.
The new directives targeting the Public Services come at a time when Kenyans have increasingly shown lack of strict observance of the issued guidelines even as the number of positive Covid-19 cases skyrocket to 13,771 and leaving 238 dead as of today.
SEE ALSO: Working from home could be blessing in disguise for persons with disabilities
Principal Secretaries/ Accounting Officers will be personally responsible for effective enforcement and compliance of the current guidelines and any future directives issued to mitigate the spread of Covid-19.
Uhuru convenes summit to review rising Covid-19 cases: The Standard
President Uhuru Kenyatta (pictured) will on Friday, July 24, meet governors following the ballooning Covid-19 infections in recent days.
The session will among other things review the efficacy of the containment measures in place and review the impact of the phased easing of the restrictions, State House said in a statement.
This story is being updated.
SEE ALSO: Sakaja resigns from Covid-19 Senate committee, in court tomorrow
Drastic life changes affecting mental health
Kenya has been ranked 6th among African countries with the highest cases of depression, this has triggered anxiety by the World Health Organization (WHO), with 1.9 million people suffering from a form of mental conditions such as depression, substance abuse.
Globally, one in four people is affected by mental or neurological disorders at some point in their lives, this is according to the WHO.
Currently, around 450 million people suffer from such conditions, placing mental disorders among the leading causes of ill-health and disability worldwide.
The pandemic has also been known to cause significant distress, mostly affecting the state of one’s mental well-being.
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With the spread of the COVID-19 pandemic attributed to the novel Coronavirus disease, millions have been affected globally with over 14 million infections and half a million deaths as to date. This has brought about uncertainty coupled with difficult situations, including job loss and the risk of contracting the deadly virus.
In Kenya the first Coronavirus case was reported in Nairobi by the Ministry of Health on the 12th March 2020. It was not until the government put in place precautionary measures including a curfew and lockdown (the latter having being lifted) due to an increase in the number of infections that people began feeling its effect both economically and socially.
A study by Dr. Habil Otanga, a Lecturer at the University of Nairobi, Department of Psychology says that such measures can in turn lead to surge in mental related illnesses including depression, feelings of confusion, anger and fear, and even substance abuse. It also brings with it a sense of boredom, loneliness, anger, isolation and frustration. In the post-quarantine/isolation period, loss of employment due to the depressed economy and the stigma around the disease are also likely to lead to mental health problems.
The Kenya National Bureau of Statistics (KNBS) states that at least 300,000 Kenyans have lost their jobs due to the Coronavirus pandemic between the period of January and March this year.
KNBC noted that the number of employed Kenyans plunged to 17.8 million as of March from 18.1 million people as compared to last year in December. The Report states that the unemployment rate in Kenya stands at 13.7 per cent as of March this year while it stood 12.4 per cent in December 2019.
Mama T (not her real name) is among millions of Kenyans who have been affected by containment measures put in place to curb the spread of the virus, either by losing their source of income or having to work under tough guidelines put in place by the MOH.
As young mother and an event organizer, she has found it hard to explain to her children why they cannot go to school or socialize freely with their peers as before.
“Sometimes it gets difficult as they do not understand what is happening due to their age, this at times becomes hard on me as they often think I am punishing them,”
Her contract was put on hold as no event or public gatherings can take place due to the pandemic. This has brought other challenges along with it, as she has to find means of fending for her family expenditures that including rent and food.
“I often wake up in the middle of the night with worries about my next move as the pandemic does not exhibit any signs of easing up,” she says. She adds that she has been forced to sort for manual jobs to keep her family afloat.
Ms. Mary Wahome, a Counseling Psychologist and Programs Director at ‘The Reason to Hope,’ in Karen, Nairobi says that such kind of drastic life changes have an adverse effect on one’s mental status including their family members and if not addressed early can lead to depression among other issues.
“We have had cases of people indulging in substance abuse to deal with the uncertainty and stress brought about by the pandemic, this in turn leads to dependence and also domestic abuse,”
Sam Njoroge , a waiter at a local hotel in Kiambu, has found himself indulging in substance abuse due to challenges he is facing after the hotel he was working in was closed down as it has not yet met the standards required by the MOH to open.
“My day starts at 6am where I go to a local pub, here I can get a drink for as little as Sh30, It makes me suppress the frustration I feel.” he says.
Sam is among the many who have found themselves in the same predicament and resulted to substance abuse finding ways to beat strict measures put in place by the government on the sale of alcohol so as to cope.
Mary says, situations like Sam’s are dangerous and if not addressed early can lead to serious complications, including addiction and dependency, violent behavior and also early death due to health complications.
She has, however, lauded the government for encouraging mental wellness and also launching the Psychological First Aid (PFA) guide in the wake of the virus putting emphasis on the three action principal of look, listen and link. “When we follow this it will be easy to identify an individual in distress and also offer assistance”.
Mary has urged anyone feeling the weight of the virus taking a toll on them not to hesitate but look for someone to talk to.
“You should not only seek help from a specialist but also talk to a friend, let them know what you are undergoing and how you feel, this will help ease their emotional stress and also find ways of dealing with the situation they are facing,” She added
Mary continued to stress on the need to perform frequent body exercises as a form of stress relief, reading and also taking advantage of this unfortunate COVID-19 period to engage in hobbies and talent development.
“Let people take this as an opportunity to kip fit, get in touch with one’s inner self and also engage in reading that would help expand their knowledge.