Digital Turbine, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Capital Stock Transactions

Capital Stock Transactions

6 Months Ended

Sep. 30, 2020

Preferred Stock

There are 2,000,000 shares of Series A Convertible Preferred Stock authorized, $0.0001 par value per share (“Series A”), and 100,000 shares of Series A issued and outstanding, which are currently convertible into 20,000 shares of common stock. The Series A holders are entitled to: (1) vote on an equal per-share basis as common stock, (2) dividends paid to the common stock holders on an if-converted basis, and (3) a liquidation preference equal to the greater of $10 per share of Series A (subject to adjustment) or such amount that would have been paid to the common stock holders on an if-converted basis.

Common Stock and Warrants

For the six months ended September 30, 2020, the Company issued 1,283,656 shares of common stock from the exercise of options under Digital Turbine's Incentive Plans.

The following table provides activity for warrants issued and outstanding during the six months ended September 30, 2020:


	Number of Warrants Outstanding	Weighted-Average Exercise Price
Outstanding as of March 31, 2020	25,000	$	2.04
Issued	—	—
Exercised	—	—
Cancelled	—	—
Expired	—	—
Outstanding as of September 30, 2020	25,000	$	2.04

Restricted Stock Awards

From time to time, the Company enters into restricted stock award (“RSAs”) agreements with certain employees, directors, and consultants. The RSAs have performance conditions, market conditions, time conditions, or a combination thereof. In some cases, once the stock vests, the individual is restricted from selling the shares of stock for a certain defined period, from three months to two years, depending on the terms of the RSA, except for Company Board members and the Chief Executive Officer, who are subject to the Company's Board Member Equity Ownership Policy, which supersedes any post-vesting lock-up in RSAs that are applicable to such persons.

Service and Time Condition RSAs

Awards of restricted stock are grants of restricted stock that are issued at no cost to the recipient. The cost of these awards is determined using the fair market value of the Company’s common stock on the date of the grant. Compensation expense for restricted stock awards with a service and time condition is recognized on a straight-line basis over the requisite service period.

In July 2019, the Company issued 75,494 restricted shares to its Board of Directors for their next annual service period. The shares vest quarterly over one year. The fair value of the shares on the date of issuance was $421.

In August 2020, the Company issued 45,110 restricted shares to its Board of Directors for their next annual service period. The shares vest quarterly over one year. The fair value of the shares on the date of issuance was $626.

With respect to time condition RSAs, the Company expensed $157 and $262 during the three and six months ended September 30, 2020, respectively; and $107 and $213 during the three and six months ended September 30, 2019, respectively.

The following is a summary of restricted stock awards and activities for all vesting conditions for the six months ended September 30, 2020:


	Number of Shares	Weighted-Average Grant Date Fair Value
Unvested restricted stock outstanding as of March 31, 2020	37,746	$	5.58
Granted	45,110	13.88
Vested	(37,746)	5.58

Unvested restricted stock outstanding as of September 30, 2020	45,110	$	13.88

All restricted shares, vested and unvested, cancellable and not cancelled, have been included in the outstanding shares as of September 30, 2020.

At September 30, 2020, there was $522 of unrecognized stock-based compensation expense, net of estimated forfeitures, related to non-vested restricted stock awards expected to be recognized over a weighted-average period of approximately 0.83 years.