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Stockholders Equity
 6 Months Ended
Jun. 30, 2023
Stockholders Equity  
Stockholders' Equity

9. Stockholders’ Equity

 

Preferred stock

 

ASP Isotopes Inc. had 10,000,000 shares of preferred stock authorized, of which no shares were issued and outstanding as of June 30, 2023 and December 31, 2022.

 

In conjunction with the formation of Enlightened Isotopes in March 2023, in exchange for 3,000,000 shares of common stock held by an officer and scientific advisor of ASP Isotopes Inc., Enlighted Isotopes issued 2,500 shares of convertible preferred stock.  These shares convert into common stock of Enlighted Isotopes at any time upon the election of the preferred stockholders such that these two investors will own 20% of the then outstanding shares on a fully diluted basis. The Company will report the non-controlling interest of future net income or loss on the consolidated balance sheet and statement of operations.

 

Common stock

 

The Company had 500,000,000 shares of common stock authorized, of which 37,385,684 shares were issued and outstanding as of June 30, 2023. Common stockholders are entitled to one vote for each share of outstanding common stock held at all meetings of stockholders and written actions in lieu of meetings. Common stockholders are entitled to receive dividends for each share of outstanding common stock, if and when declared by the Board. No dividends have been declared or paid by the Company through June 30, 2023.

 

During 2022, prior to the IPO, the Company issued 1,559,780 shares of common stock at $2.00 per share for gross proceeds of $3,119,560. The Company incurred $255,965 in cash issuance costs and is required to issue 120,491 shares of common stock to the placement agent with an initial fair value of $240,982. In October 2022, the Company amended its agreement with the placement agent for the shares issued from November 2021 through the first nine months of 2022. The shares of common stock issuable to the placement agent was reduced from 120,491 shares to 57,250 shares. The fair value of the 57,250 shares issuable to the placement agent as of December 31, 2022 was $90,455. The fair value of the 57,250 shares issuable to the placement agent just prior to settlement in March 2023 was $75,570, resulting in a change in fair value of share liability of $14,885 for the three months ended March 31, 2023. In March 2023, the Company settled this share liability by issuing 57,250 shares of common stock.

 

In November 2022, the Company was required to issue shares of common stock with a fair value totaling $50,000 to a consultant. As of June 30, 2023, these shares had yet to be issued.

 

In November 2022, the Company completed its IPO, selling an aggregate of 1,250,000 shares of common stock at a price to the public of $4.00 per share, not including 187,500 shares of common stock issuable pursuant to the underwriters’ exercise of their option to purchase additional shares of common stock. The Company received net proceeds from the IPO, after deducting underwriting discounts and commissions but before deducting offering costs, of approximately $3.8 million.

 

In February 2023, the Company was required to issue an aggregate of 100,000 shares of common stock to two consultants. The Company determined that the fair value of these two awards was $1.55 and $1.90 per share, respectively, for a total value of $172,500. The fair value of these shares issuable to the two consultants was $56,800 and $85,400 as of June 30, 2023 and March 31, 2023, respectively resulting in a change in fair value of share liability of $28,600 and $115,700 for the three and six months ended June 30, 2023, respectively. As of June 30, 2023, these shares had yet to be issued.

 

In March 2023, the Company was required to issue an aggregate of 100,000 shares of restricted common stock pursuant to a settlement agreement that vests immediately. The Company determined that the fair value of this award was $0.94 per share for a total value of $93,700. The fair value of these shares issuable pursuant to a settlement agreement was $56,800 and $85,400 as of June 30, 2023 and March 31, 2023, respectively, resulting in a change in fair value of share liability of $36,900 and $28,600 for the three and six months ended June 30, 2023, respectively. As of June 30, 2023, these shares had yet to be issued.

 

In March 2023, an officer and scientific advisor of the Company exchanged an aggregate of 3,000,000 shares of ASP Isotopes Inc. common stock for 2,500 shares of Enlighted Isotopes convertible preferred stock. In conjunction with the exchange, Enlighted Isotopes transferred the common shares of ASP Isotopes Inc. to ASP Isotopes and then ASP Isotopes immediately cancelled all 3,000,000 shares. The Company will report the non-controlling interest of future net income or loss on the consolidated balance sheet and statement of operations.

 

In March 2023, the Company’s non-employee board members agreed to receive the 2022 cash director fees totaling $45,000 in shares of common stock.  As of June 30, 2023, these shares had yet to be issued.

 

In March 2023, the Company issued 3,164,557 shares of the Company’s common stock at a purchase price of $1.58 per share and warrants to purchase up to an aggregate of 3,164,557 shares of its common stock with an exercise price of $1.75 per share for gross proceeds of $5.0 million. The Company incurred $506,390 in cash issuance costs and issued warrants to purchase up to an aggregate of 221,519 shares of common stock with an exercise price of $1.975 per share to the placement agent with an initial fair value of $179,116.

 

In May 2023, the Company was required to issue an aggregate of 100,000 shares of restricted common stock pursuant to a consultant. The Company determined that the fair value of this award was $0.65 per share for a total value of $65,100. The fair value of these shares issuable to the consultant was $56,800 as of June 30, 2023 resulting in a change in fair value of share liability of $8,300 for the three and six months ended June 30, 2023. As of June 30, 2023, these shares had yet to be issued.

In May 2023, the Company was required to issue an aggregate of 300,000 shares of restricted common stock pursuant to an employee. The Company determined that the fair value of this award was $0.55 per share for a total value of $165,000. The fair value of these shares issuable to the employee was $170,400 as of June 30, 2023 resulting in a change in fair value of share liability of $5,400 for the three and six months ended June 30, 2023. As of June 30, 2023, these shares had yet to be issued.

 

Common Stock Warrants

 

The fair values of the warrants issued in the six months ended June 30, 2023 were estimated based on the Black-Scholes model, using the following assumptions:

 

Expected volatility

 

 

60.3%

Weighted-average risk-free rate

 

 

3.44%

Expected term in years

 

 

5.5

 

Expected dividend yield

 

 

0%

 

In January 2022, warrants to purchase 7,230,822 shares of common stock were net share settled into 7,194,847 shares of common stock per the terms of the underlying warrant agreements. No warrants were exercised in the six months ended June 30, 2023.