Annual report [Section 13 and 15(d), not S-K Item 405]

EQUITY

v3.25.0.1
EQUITY
12 Months Ended
Dec. 31, 2024
EQUITY  
EQUITY

 

Preferred shares

 

The Company has authorized 416,667 shares of preferred stock with a par value of $0.001 per share.

 

As of December 31, 2024, and 2023, there were no shares of preferred stock issued or outstanding.

 

Common Shares

 

The Company has authorized 50,000,000 shares of Common Stock with a par value of $0.001 per share. Each share of Common Stock entitles the holder to one vote, in person or proxy, on any matter on which an action of the stockholders of the Company is sought.

 

During the years ended December 31, 2024, and 2023, in accordance with the Equity Line, the Company issued 92,073 and 333,271, shares of the Company’s Common Stock with aggregate proceeds to the Company of $112 and $567, respectively. As of December 31, 2024, and 2023, there were 3,281,032 and 3,188,959 shares of Common Stock issued and outstanding, respectively. 

 

Warrants

 

A summary of activity of the warrants during the years ended December 31, 2024, and 2023, is as follows:

 

 

 

Number of

 

 

Weighted Average

 

 

Weighted Average

 

 

 

shares

 

 

Exercise Price

 

 

Life (years)

 

Outstanding, December 31, 2022

 

 

270,053

 

 

$ 64.16

 

 

 

2.05

 

Granted

 

 

-

 

 

 

-

 

 

 

-

 

Expired

 

 

(27,420 )

 

 

198.07

 

 

 

-

 

Exercised

 

 

-

 

 

 

-

 

 

 

-

 

Outstanding, December 31, 2023

 

 

242,633

 

 

$ 44.07

 

 

 

1.10

 

Granted

 

 

-

 

 

 

-

 

 

 

-

 

Expired

 

 

(102,736 )

 

 

100.48

 

 

 

-

 

Exercised

 

 

-

 

 

 

-

 

 

 

-

 

Outstanding, December 31, 2024

 

 

139,897

 

 

$ 11.25

 

 

 

0.79

 

 

The intrinsic value of the warrants as of December 31, 2024, is $0. All of the outstanding warrants are exercisable as of December 31, 2024.

 

2018 Equity Incentive Plan, as amended

 

On January 1, 2024, the number of shares available under the Company’s 2018 Equity Incentive Plan, as amended (the “2018 Plan”) was increased by 478,344 shares of Common Stock.

 

As of December 31, 2024, the 2018 Plan permits the Company to issue up to an aggregate of 1,529,223 shares of Common Stock of which 755,618 shares are available to be issued.

 

Options granted during the year ended December 31, 2024

 

In January 2024, the Company granted options to an officer of the Company to purchase an aggregate of 92,000 shares of the Company’s Common Stock with an exercise price of $1.49 and vesting as follows: twenty-five (25%) of the shares subject to the option shall vest on the one-year anniversary of the vesting commencement date, and one forty-eighth (1/48th) of the shares subject to the option shall vest each month thereafter on the same day of the month as the vesting commencement date. The vesting commencement date is January 5, 2024.

 

On March 5, 2024, the Company granted options to certain employees, officers and consultants to purchase a total of 152,000 shares of the Company’s common stock with an exercise price of $1.47 and vesting as follows: twenty-five percent (25%) of the shares subject to the option shall vest on the one (1) year anniversary of the vesting commencement date, and one forty-eighth (1/48th) of the shares subject to the option shall vest each month thereafter on the same day of the month as the vesting commencement date. The vesting commencement date is March 5, 2024.

 

On December 20, 2024, the Company granted options to directors to purchase a total of 10,500 shares of the Company’s common stock with an exercise price of $0.9476 and one hundred percent (100%) of the shares subject to the option shall vest on the earlier of (i) the one (1) year anniversary of the vesting commencement date, or (ii) the day prior to the date of the annual meeting of the Issuer's stockholders next following the vesting commencement date. The vesting commencement date is December 20, 2024.

 

Options granted during the year ended December 31, 2023

 

On January 1, 2023, the 2018 Plan was increased to permit the issuance of an additional 428,353 shares of common stock, which increased the number of shares available for issuance pursuant to the 2018 Plan to a new total of 737,770 shares.

 

On February 1, 2023, the Company granted an option to the Company’s president to purchase a total of 85,000 shares of the Company’s common stock with an exercise price of $3.15 and vesting as follows: 25% of the shares subject to the option shall vest on the one-year anniversary of the vesting commencement date, and 1/48th of the shares subject to the option shall vest each month thereafter on the same day of the month as the vesting commencement date. The vesting commencement date is February 1, 2023.

 

On February 2, 2023, the Company granted options to certain employees and consultants to purchase a total of 90,000 shares of the Company’s common stock with an exercise price of $3.15 and vesting as follows: twenty-five percent (25%) of the shares subject to the option shall vest on the one (1) year anniversary of the vesting commencement date, and one forty-eighth (1/48th) of the shares subject to the option shall vest each month thereafter on the same day of the month as the vesting commencement date. The vesting commencement date is February 1, 2023.

 

On February 2, 2023, the Company granted options to certain employees and consultants to purchase a total of 19,750 shares of the Company’s common stock with an exercise price of $3.15 and vesting as follows: one hundred percent (100%) of the shares subject to the option shall vest on the one (1) year anniversary of the vesting commencement date on the same day of the month as the vesting commencement date. The vesting commencement date is February 1, 2023.

 

On February 2, 2023, the Company granted options to an employee to purchase a total of 746 shares of the Company’s common stock with an exercise price of $3.15 and vesting as follows: 50% of the shares subject to the option shall vest on the one (1) year anniversary of the vesting commencement date, and one twenty-fourth (1/24th) of the shares subject to the option shall vest each month thereafter on the same day of the month as the vesting commencement date. The vesting commencement date is February 1, 2023.

 

On June 30, 2023, the Company granted options to certain directors of the Company to purchase a total of 4,002 shares of the Company’s common stock with an exercise price of $1.99, all of which shall vest on the one (1) year anniversary of the vesting commencement date. The vesting commencement date is June 30, 2023.

 

On August 4, 2023, the Company granted options to certain directors of the Company to purchase a total of 6,498 shares of the Company’s common stock with an exercise price of $2.01, all of which shall vest on the one (1) year anniversary of the vesting commencement date. The vesting commencement date is June 30, 2023.

 

The following is a summary of stock option activity during the years ended December 31, 2024, and 2023:

 

 

 

Options Outstanding

 

 

Weighted

 

 

 

Number of

Options

 

 

Weighted Average

Exercise Price(1)

 

 

Average

Remaining

life

(years)

 

 

 

 

 

 

 

 

 

 

 

Outstanding, December 31, 2022

 

 

313,109

 

 

$ 24.15

 

 

 

8.41

 

Granted

 

 

205,996

 

 

 

3.03

 

 

 

10.00

 

Exercised

 

 

-

 

 

 

-

 

 

 

-

 

Forfeited/canceled

 

 

-

 

 

 

-

 

 

 

-

 

Outstanding, December 31, 2023

 

 

519,105

 

 

$ 15.97

 

 

 

8.07

 

Granted

 

 

254,500

 

 

 

1.48

 

 

 

10.00

 

Exercised

 

 

-

 

 

 

-

 

 

 

-

 

Forfeited/canceled

 

 

-

 

 

 

-

 

 

 

-

 

Outstanding, December 31, 2024

 

 

773,605

 

 

$ 1.84

 

 

 

7.76

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercisable options, December 31, 2024

 

 

11,085

 

 

$ 20.80

 

 

 

6.49

 

   

(1)

During February 2024, 488,069 options were repriced to $1.55 and had their vesting schedules modified.  As per Accounting Standards Update 2021-07 Compensation – Stock Compensation (Topic 718) the changes were treated as modifications to the options and the incremental fair value was calculated resulting in $210 in additional expense to amortize over the updated vesting schedule of 1/3rd of the shares subject to the options will vest on the first anniversary and 1/36th of the shares subject to the option will vest each month thereafter.  The amendment date was February 28, 2024.

 

Valuation

 

The Company utilizes the Black-Scholes model to value its stock options. The Company utilized the following assumptions:

 

 

 

Year ended

 

 

Year Ended

 

 

 

December 31,

 

 

December 31,

 

 

 

2024

 

 

2023

 

Expected term

 

 3.08 - 6.08 years

 

 

 5.50 - 6.25 years

 

Expected average volatility

 

87 - 110%

 

 

110 - 150%

 

Expected dividend yield

 

 

-

 

 

 

-

 

Risk-free interest rate

 

4.02 - 4.44%

 

 

3.43 - 4.15%

 

 

During the year ended December 31, 2024, the Company granted 254,500 options, valued at $307 of which 113,500 valued at $137 were for related parties. During the year ended December 31, 2023, the Company granted 205,996 options, valued at $586, of which 150,246 valued at $427 were for related parties. During the year ended December 31, 2024, and 2023, the Company recognized stock-based compensation expense of $818 and $1,020, respectively, of which $475 and $890 was for related parties, respectively, and as of December 31, 2024, $1,013 remains unamortized, of which $652 is for related parties. The intrinsic value of options outstanding as of December 31, 2024, and 2023 is $0.