Quarterly report pursuant to Section 13 or 15(d)

EQUITY

v3.22.2.2
EQUITY
 9 Months Ended
Sep. 30, 2022
EQUITY  
NOTE 5 - EQUITY

NOTE 5 - EQUITY

 

Preferred shares

 

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

 

During the nine months ended September 30, 2022, there were no issuances of preferred stock. No preferred stock was issued and outstanding as of September 30, 2022.

 

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.

 

On May 13, 2022, the Company entered into a purchase agreement and a registration rights agreement (together, the “Lincoln Park Agreements”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”) providing for the purchase by Lincoln Park of up to $20,000 worth of the Company’s Common Stock, over the thirty-six (36) month term of the Lincoln Park Agreements. The Company issued to Lincoln Park 19,532 shares of its Common Stock as commitment shares in consideration for entering into the Lincoln Park Agreements and received no funds in exchange for such commitment shares. Upon initiation of the Lincoln Park Agreements, the Company recorded $134 as a deferred offering cost. As of September 30, 2022, the Company had not issued any equity in accordance with the terms of the Lincoln Park Agreements, and as such, the balance of deferred offering costs was $134.

 

Warrants

 

A summary of activity during the nine months ended September 30, 2022, follows:

 

 

 

 

 

 

Weighted

 

 

Weighted

 

 

 

Number of

 

 

Average

 

 

Average

 

 

 

shares

 

 

Exercise Price

 

 

Life (years)

 

Outstanding, December 31, 2021

 

 

 295,601

 

 

 $ 69.45

 

 

 

 2.83

 

Forfeited

 

 

 -

 

 

 

 -

 

 

 

 -

 

Expired

 

 

 (25,548 )

 

 

 125.92

 

 

 

 -

 

Exercised

 

 

 -

 

 

 

 -

 

 

 

 -

 

Outstanding, September 30, 2022

 

 

 270,053

 

 

 $ 64.16

 

 

 

 2.30

 

 

The intrinsic value of the warrants as of September 30, 2022, is $0. All of the outstanding warrants are exercisable as of September 30, 2022.

 

Stock Options

 

Amended and Restated 2018 Equity Incentive Plan

 

On February 15, 2022, 17,177 shares of Common Stock were returned to the option pool and on February 18, 2022, the number of shares of Common Stock reserved for issuance under the 2018 Plan increased by 141,003. Such additional shares were registered on a Registration Statement on Form S-8 filed with the Securities and Exchange Commission on April 7, 2022. On May 15, 2022, and July 20, 2022, an additional 6,077 and 1,584 shares, respectively, were returned to the option pool.

 

In June 2022, 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 $4.89 and vesting on the earlier of the one-year anniversary of the vesting commencement date or the date prior to the date of the Company’s annual meeting following the vesting commencement date. The vesting commencement date is June 24, 2022.

 

As of September 30, 2022, 622,526 shares are available to be issued under the 2018 Plan.

Valuation

 

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

 

 

 

Nine months ended

 

 

 

September 30,

 

 

 

2022

 

Expected term

 

 5.50 years

 

Expected average volatility

 

 

 153 %

Expected dividend yield

 

 

 -

 

Risk-free interest rate

 

 

 3.18 %

 

During the nine months ended September 30, 2022, the Company granted 4,002 options valued at $18. During the nine months ended September 30, 2022, the Company recognized stock-based compensation expense of $1,850, of which $1,668 was for related parties, and as of September 30, 2022, $2,356 remains unamortized, of which $1,766 is for related parties. The intrinsic value of the 313,109 options outstanding as of September 30, 2022, is $0.

 

The following is a summary of stock option activity during the nine months ended September 30, 2022:

 

 

 

Options Outstanding

 

 

Weighted

 

 

 

Number of

 

 

Weighted

Average

 

 

Average

Remaining life

 

 

 

Options

 

 

Exercise Price

 

 

(years)

 

 

 

 

 

 

 

 

 

 

 

Outstanding, December 31, 2021

 

 

 333,945

 

 

 $ 24.45

 

 

 

 9.36

 

Granted

 

 

 4,002

 

 

 

 4.89

 

 

 

 10.00

 

Exercised

 

 

 -

 

 

 

 -

 

 

 

 -

 

Forfeited/cancelled

 

 

 (24,838 )

 

 

 25.69

 

 

 

 8.74

 

Outstanding, September 30, 2022

 

 

 313,109

 

 

 $ 24.15

 

 

 

 8.66

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercisable options, September 30, 2022

 

 

 90,315

 

 

 $ 37.71

 

 

 

 8.14