v3.22.2
Stockholders' Equity
 6 Months Ended
Jun. 30, 2022
Disclosure of Stockholders' Equity [Abstract]  
Stockholders' Equity

Note 3 — Stockholders’ Equity:

 

Common Stock

 

In November 2020, the Company filed a shelf registration statement (the “2020 Shelf Registration”), under which the Company could issue and sell up to an aggregate of $100.0 million of shares of its common stock. On November 27, 2020, the Company entered into an Amended and Restated At Market Issuance Sales Agreement (“Amended Sales Agreement”) with FBR Securities, Inc. (formerly known as B. Riley FBR Inc.) and Needham & Company, LLC, as sales agents. The Amended Sales Agreement relates to the sale of shares of the Company’s common stock under its at-the-market program (“ATM program”), of which the Company may issue and sell common stock from time to time through the sales agents, subject to limitations imposed by the Company and subject to the sales agents’ acceptance, such as the number or dollar amount of shares registered under the 2020 Shelf Registration to which the offering relates. The sales agents are entitled to a commission of up to 3% of the gross proceeds from the sale of common stock sold under the ATM program. The Company allocated to its ATM program an aggregate of $50.0 million out of the $100.0 million total under the 2020 Shelf Registration leaving a balance of $50.0 million as of June 30, 2021.

 

On August 12, 2021, the Company entered into an At Market Issuance Sales Agreement with Truist Securities, Inc. and JMP Securities LLC, as sales agents, pursuant to which the Company may sell, from time to time, an aggregate of up to $50.0 million, which was the remaining balance under the 2020 Shelf Registration, of its common stock through the sales agents under its ATM program, subject to limitations imposed by the Company and subject to the sales agent’s acceptance, such as the number or dollar amount of shares registered under the 2020 Shelf Registration to which the offering relates. The sales agents are entitled to a commission of up to 3% of the gross proceeds from the sale of common stock sold under the ATM program. Additionally, on August 12, 2021, the Company filed a new shelf registration statement (the “2021 Shelf Registration”) for the issuance of up to $150.0 million of shares of its common stock.

 

During the six months ended June 30, 2022 and 2021, the Company sold an aggregate of 3,020,340 and 3,737,862 shares of its common stock under the ATM program, respectively, and realized net proceeds of $11,415,000 and $41,456,000, respectively.

 

As of June 30, 2022, the Company has $38.2 million available under its ATM program with Truist Securities, Inc. and JMP Securities LLC, and it has $150.0 million available under the 2021 Shelf Registration for the issuance of equity, debt or equity-linked securities.

 

During the six months ended June 30, 2021, the Company issued an aggregate of 656,069 shares of its common stock upon conversion of 50,000 Series C-3 preferred shares by an unrelated party and 10,001 Series G preferred shares by a related party.

 

During the six months ended June 30, 2021, the Company issued an aggregate of 31,407 shares of its common stock, upon cash exercise of warrants, resulting in net proceeds to the Company of $165,000.

 

During the six months ended June 30, 2021, the Company issued an aggregate of 70,269 shares of its common stock upon cashless exercise of 95,286 warrants.

 

During the six months ended June 30, 2021, the Company issued an aggregate of 32,734 shares of its common stock upon exercise of stock options, resulting in net proceeds to the Company of $137,000.

 

Preferred Stock

 

The Company is authorized to issue up to 2,000,000 shares of preferred stock in one or more series without stockholder approval. The Company’s board of directors (the “Board”) has the discretion to determine the rights, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, of each series of preferred stock. Of the 2,000,000 shares of preferred stock authorized and designated by the Company’s Board, all with par value of $0.001 per share, the following are outstanding:

 

   As of June 30, 2022    As of December 31, 2021 
   Preferred
Shares
Outstanding		   Liquidation
Preference
(Per Share)		   Total
Liquidation
Preference		   Preferred
Shares
Outstanding		   Liquidation
Preference
(Per Share)		   Total
Liquidation
Preference		 
Series C-3   2,000   $10.00   $20,000    2,000   $10.00   $20,000 
Series E   89,623   $49.20   $4,409,452    89,623   $49.20   $4,409,452 
Series G   89,999   $187.36   $16,862,213    89,999   $187.36   $16,862,213 
Total   181,622        $21,291,665    181,622        $21,291,665 

During the six months ended June 30, 2021, 50,000 Series C-3 preferred shares was converted into 100,000 shares of the Company’s common stock by an unrelated party and 10,001 Series G preferred shares was converted into 556,069 shares of the Company’s common stock by a related party.

 

Stock Options

 

During the six months ended June 30, 2022 and 2021, the Company granted ten-year qualified and non-qualified stock options covering an aggregate of 1,377,850 and 1,389,700 shares of the Company’s common stock under the 2019 Stock Incentive Plan, respectively. The weighted average exercise price of these options is $3.73 and $8.48 per share, respectively.

 

During the three and six months ended June 30, 2022, total compensation expense for stock options issued to employees, directors, officers and consultants was $1,024,000 and $2,162,000, respectively, and $1,010,000 and $2,742,000 for the three and six months ended June 30, 2021, respectively.

 

As of June 30, 2022, there was approximately $5,962,000 in total unrecognized compensation expense related to stock options granted, which expense will be recognized over an expected remaining weighted average period of 1.6 years.

 

The fair value of each stock option award estimated on the grant date is determined using the Black-Scholes option pricing model. The following assumptions were used for the Black-Scholes option pricing model for the stock options granted during the six months ended June 30, 2022:

 

Expected term  5 years 
Volatility weighted average   101.17%
Dividend yield weighted average   0.0%
Risk-free interest rate weighted average   2.30%
Weighted average grant date fair value of options granted during the period  $2.82 

 

The Company estimated the expected term of the stock options granted based on anticipated exercises in future periods. The expected term of the stock options granted to consultants, if any, is based upon the full term of the respective option agreements. The expected stock price volatility for the Company’s stock options is calculated based on the historical volatility. The expected dividend yield of 0.0% reflects the Company’s current and expected future policy for dividends on the Company’s common stock. To determine the risk-free interest rate, the Company utilized the U.S. Treasury yield curve in effect at the time of grant with a term consistent with the expected term of the Company’s awards which is 5 years for employees and 10 years for non-employees.

 

Restricted Stock Units

 

On May 10, 2022, the Company granted 207,469 restricted stock units (“RSUs”) to its chief executive officer under its 2019 Omnibus Stock Incentive Plan with a weighted average grant date fair value of $3.38 per share. The fair market value of the RSUs was estimated to be the closing price of the Company’s common stock on the date of grant. These RSUs vest as to 50% on the first anniversary of the grant date, as to 30% on the second anniversary of the grant date, and as to 20% on the third anniversary of the grant date, subject to continued service as an employee or consultant through the applicable vesting date.

 

During the three and six months ended June 30, 2022, compensation expense recorded for the RSUs was $50,000. Unrecognized compensation expense for these RSUs amounted to $651,000. The expected weighted average period for the expense to be recognized is 1.6 years.

 

Warrants

 

During the six months ended June 30, 2021, the Company issued an aggregate of 31,407 shares of its common stock, upon cash exercise of warrants, resulting in net proceeds to the Company of $165,000. There were no cash exercises of warrants during the six months ended June 30, 2022.

 

During the six months ended June 30, 2021, the Company issued an aggregate of 70,269 shares of its common stock upon cashless exercise of 95,286 warrants. There were no cashless exercises of warrants during the six months ended June 30, 2022.

 

As of June 30, 2022, there were 56,455 outstanding warrants with a weighted average exercise price of $5.25 per share and a weighted average remaining contractual life of 0.11 years.