Monitor for any Schedule 13D filings or public disclosures of 4.99%+ ownership that could trigger the rights distribution. The plan's 4.99% threshold is low, so any accumulation near that level could signal an activist or strategic buyer. The rights are initially non-exercisable and trade with the common stock until the Distribution Date.
Price Chart
Executive Summary
Sonoma Pharmaceuticals adopted a new Section 382 shareholder rights plan (poison pill) effective October 6, 2026, replacing the prior plan that expires October 18, 2026. The plan issues one right per common share, exercisable at $10.00 per 1/1000th of a Series B Preferred Share, triggered if any person acquires 4.99% or more of common stock (with a 0.5% buffer for existing 4.99%+ holders). The plan is designed to preserve the company's net operating loss carryforwards (NOLs) by deterring an ownership change under Section 382 of the Internal Revenue Code.
Key Facts
- Board declared a dividend of one Right per outstanding common share as of October 13, 2026 record date.
- Each Right initially entitles holder to purchase 1/1000th of a share of Series B Preferred Stock at $10.00.
- Rights become exercisable (Distribution Date) on the 10th day after a person or group acquires 4.99% or more of common stock.
- Existing holders of 4.99%+ as of October 6, 2026 are grandfathered unless they exceed their percentage by 0.5%.
- Rights expire on October 6, 2036, unless earlier redeemed at $0.0001 per Right or exchanged by the Board.
- The plan replaces a prior Section 382 Rights Agreement dated October 18, 2016, which expires October 18, 2026.
- No shares of Series B Preferred Stock have been issued; 100,000 shares are authorized.
- The company states it has experienced and continues to experience substantial operating losses and believes it can carry forward significant NOLs.
Financial Impact
No financial figures reported; the plan is a defensive measure to protect NOL tax assets, the value of which is not quantified in the filing.
Risk Factors
- The poison pill could deter potential acquirers or activists, potentially limiting shareholder premium opportunities.
- If an ownership change occurs despite the plan, NOLs could be substantially limited, impairing a potential tax asset.
- The plan may be challenged by shareholders or potential acquirers as anti-takeover device.
Investment Themes
Documents Analyzed
This report is based on 6 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001683168-26-007657 |
| Document: sonoma_8k.htm | 0001683168-26-007657 |
| Document: sonoma_ex0301.htm | 0001683168-26-007657 |
| Document: 0001683168-26-007657-index-headers.html | 0001683168-26-007657 |
| Document: 0001683168-26-007657-index.html | 0001683168-26-007657 |
| Document: 0001683168-26-007657.txt | 0001683168-26-007657 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 6, 2026 20d ago | 8-K | $1.22 $1.16 | ▼ −4.92% | ▼ −4.49% | $1.12 (−8.20%) |
Jun 18, 2026 18w ago | 8-K | $1.16 $1.14 | ▲ +1.72% | ▲ +0.27% | $1.12 (+3.45%) |
Jun 18, 2026 18w ago | 424B5 | $1.16 $1.14 | ▲ +1.72% | ▲ +0.27% | $1.12 (+3.45%) |
Apr 27, 2026 26w ago | 424B4 | $1.11 $1.04 | ▲ +6.31% | ▲ +5.82% | $1.12 (−0.90%) |
Apr 17, 2026 27w ago | S-1 | $2.65 $2.25 | ▼ −15.09% | ▼ −14.44% | $1.12 (−57.74%) |
Apr 9, 2026 28w ago | 8-K | $2.41 $2.28 | ▼ −5.39% | ▼ −5.33% | $1.12 (−53.53%) |
US Market Status
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