Was the breach deliberate or out of their hands (force majeure)?
If they are sued on the breach - these will be material questions a judge/jury will consider ehen awarding damages if they exist.
There is considerable shorting when there is a known supply of stock to cover the short position. That is the way it works. Paid on both ends. They drve the price down with shorting and then cover the shorts with the issued shares. They ensure payback/ROI while minimizing risk. If they are prevented from converting and have open short positions when the tide turns - oops.
I would rather tske my chances in court on the breach then have them diluting the hell out of the stock.