Convertible Preferred Stock	12 Months Ended
Dec. 31, 2021
Convertible Preferred Stock
Convertible Preferred Stock	Note 8 – Convertible Preferred Stock Series A Preferred Stock In September 2019, the Company authorized the sale and issuance of up to 1,987,979 shares of Series A Preferred Stock, $0.001 par value per share, at an original issuance price of $8.5514 per share. In January 2020, the number of shares authorized for the Series A Preferred Stock was increased to 2,495,933 shares. The Series A Preferred Stock financing was structured to be issued in rolling closes during 2019 and 2020. On September 20, 2019, the Company issued an additional 1,122,458 shares of Series A Preferred Stock for gross cash proceeds of $9,598,847 and issued 785,706 shares of Series A Preferred Stock in conjunction with the conversion of the outstanding amount of the Convertible Notes. In 2019, the Company incurred issuance costs of $200,587 in connection with this offering. The Company received funds for issuance of an additional 468,315 shares of Series A Preferred Stock for gross cash proceeds of $4,004,975 through December 31, 2019. Of these shares, 410,436 shares of Series A Preferred Stock for gross cash proceeds of $3,509,802 exceeded the authorized amount allowed by the articles of incorporation, resulting in a liability of $3,509,802 and a total of 1,966,043 shares of Series A Preferred Stock outstanding at December 31, 2019. In January 2020, the shares that were previously classified as a liability as of December 31, 2019 were reclassified to temporary equity upon the approved increase to authorized shares of Series A Preferred Stock. In January 2020, the Company issued 119,454 additional shares of Series A Preferred Stock for gross cash proceeds of $1,021,413. The Company incurred issuance costs of $23,610 in connection with the financing in January 2020. Series B Preferred Stock In December 2020, the Company authorized the sale and issuance of up to 6,032,183 shares of Series B Preferred Stock, $0.001 par value per share, at an original issuance price of $10.2782 per share. The Series B Preferred Stock financing was structured to close in two tranches. The first tranche closed in December 2020 and the Company issued 3,619,292 shares of Series B Preferred Stock for gross cash proceeds of $37,199,929. The Company incurred issuance costs of $216,019 in connection with the financing in December 2020. The Company determined the right of the investors to purchase 2,412,853 shares of Series B Preferred Stock in the second tranche does not meet the definition of a freestanding financial instrument as it is not separable from the Series B Preferred Stock issued in the first tranche. The issuance of the second tranche is subject to the Company meeting certain development milestones or at the election of the holders of at least a majority of the then outstanding shares of Series B Preferred Stock which must include one specific shareholder (the “Requisite Holders”). Each holder of Series B Preferred Stock may elect to purchase their requisite shares of the second tranche at any time. As of March 31, 2021, the Company had not met these development milestones nor did the Requisite Holders elect to purchase the second tranche prior to meeting these milestones and therefore no shares of the second tranche were issued. In April and May 2021, all 2,412,853 shares of the second tranche of Series B Preferred Stock were issued based on the voluntary election of substantially all of the holders of Series B Preferred Stock. The Company received gross proceeds of $24,799,786. The Company incurred issuance costs of $10,935 in connection with the second tranche of Series B Preferred Stock. The rights and preferences of the Series A Preferred Stock and Series B Preferred Stock (“Preferred Stock”) were as described below: Conversion Each share of Preferred Stock may be converted at any time, at the option of the holder, into shares of Class A common stock, subject to the applicable conversion rate as determined by dividing the original issue price by the conversion price. The conversion price for the Series A Preferred Stock and Series B Preferred Stock (as may be adjusted for certain customary dilutive events) is $6.1081 and $7.3416, respectively. The Preferred Stock automatically convert into shares of Class A common stock at the then effective conversion rate upon the closing of a public offering of the Company’s securities with gross proceeds to the Company of at least $75,000,000 and a share price of at least $7.3416 or at the election of the holders of the Requisite Holders. Holders of Series B Preferred Stock that would beneficially own at least 9.9% of any then outstanding class of equity securities may elect to receive a portion of their converted Series B Preferred Stock as Class B common stock upon conversion. Upon the closing of the IPO on August 3, 2021, all 8,528,078 shares of the Company’s convertible preferred stock then outstanding automatically converted into 11,939,281 shares of Class A common stock. Dividends Preferred Stockholders are entitled to receive per annum dividends of 7% of the original issue price share, payable only when, as and if declared by the Board of Directors. The right to receive these dividends is not cumulative, and therefore, if not declared in any year, the right to receive such dividends shall terminate and not carry forward into the next year. As of December 31, 2021 and December 31, 2020, no dividends had been declared. Voting Rights Preferred Stock and common stock vote together as one class on an as converted basis. Common stock voting rights on certain matters are subject to the powers, preferences, and rights of the Preferred Stock. Preferred Stockholders are entitled to vote on all matters and shall have the number of votes equal to the number of shares of common stock into which the shares of Preferred Stock held by such holder are then convertible. As long as 2,132,029 shares of Preferred Stock are outstanding, certain actions such as mergers, acquisition, liquidation, dissolution, wind up of business, and deemed liquidation events, must be approved by the holders of at least a majority of the then-outstanding shares of Preferred Stock. Liquidation Preference Upon liquidation, dissolution, or winding up of business, holders of Preferred Stock are entitled to receive a liquidation preference in priority to holders of common stock at the original respective Preferred Stock issue price for such series. If assets available for distribution are insufficient to satisfy the liquidation payment to holders of Preferred Stock in full, assets available for distribution will be allocated among holders of Preferred Stock on a pari passu basis at an amount per share equal to the greater of the respective original Preferred Stock issue price for such series plus any declared but unpaid dividends or such amount had all shares been converted to common stock. When holders of Preferred Stock are satisfied in full, any excess assets available for distribution will be allocated ratably among common stock holders based on their pro rata shareholdings. Upon a deemed liquidation event, as defined in the articles of incorporation, holders have the option to redeem their shares at the liquidation payment amounts summarized above. Redemption Other than described above, the shares of Preferred Stock are not redeemable.

Convertible Preferred Stock

12 Months Ended

Dec. 31, 2021

Note 8 – Convertible Preferred Stock

Series A Preferred Stock

In September 2019, the Company authorized the sale and issuance of up to 1,987,979 shares of Series A Preferred Stock, $0.001 par value per share, at an original issuance price of $8.5514 per share. In January 2020, the number of shares authorized for the Series A Preferred Stock was increased to 2,495,933 shares. The Series A Preferred Stock financing was structured to be issued in rolling closes during 2019 and 2020.

On September 20, 2019, the Company issued an additional 1,122,458 shares of Series A Preferred Stock for gross cash proceeds of $9,598,847 and issued 785,706 shares of Series A Preferred Stock in conjunction with the conversion of the outstanding amount of the Convertible Notes. In 2019, the Company incurred issuance costs of $200,587 in connection with this offering.

The Company received funds for issuance of an additional 468,315 shares of Series A Preferred Stock for gross cash proceeds of $4,004,975 through December 31, 2019. Of these shares, 410,436 shares of Series A Preferred Stock for gross cash proceeds of $3,509,802 exceeded the authorized amount allowed by the articles of incorporation, resulting in a liability of $3,509,802 and a total of 1,966,043 shares of Series A Preferred Stock outstanding at December 31, 2019. In January 2020, the shares that were previously classified as a liability as of December 31, 2019 were reclassified to temporary equity upon the approved increase to authorized shares of Series A Preferred Stock.

In January 2020, the Company issued 119,454 additional shares of Series A Preferred Stock for gross cash proceeds of $1,021,413. The Company incurred issuance costs of $23,610 in connection with the financing in January 2020.

Series B Preferred Stock

In December 2020, the Company authorized the sale and issuance of up to 6,032,183 shares of Series B Preferred Stock, $0.001 par value per share, at an original issuance price of $10.2782 per share. The Series B Preferred Stock financing was structured to close in two tranches. The first tranche closed in December 2020 and the Company issued 3,619,292 shares of Series B Preferred Stock for gross cash proceeds of $37,199,929. The Company incurred issuance costs of $216,019 in connection with the financing in December 2020.

The Company determined the right of the investors to purchase 2,412,853 shares of Series B Preferred Stock in the second tranche does not meet the definition of a freestanding financial instrument as it is not separable from the Series B Preferred Stock issued in the first tranche. The issuance of the second tranche is subject to the Company meeting certain development milestones or at the election of the holders of at least a majority of the then outstanding shares of Series B Preferred Stock which must include one specific shareholder (the “Requisite Holders”). Each holder of Series B Preferred Stock may elect to purchase their requisite shares of the second tranche at any time. As of March 31, 2021, the Company had not met these development milestones nor did the Requisite Holders elect to purchase the second tranche prior to meeting these milestones and therefore no shares of the second tranche were issued.

In April and May 2021, all 2,412,853 shares of the second tranche of Series B Preferred Stock were issued based on the voluntary election of substantially all of the holders of Series B Preferred Stock. The Company received gross proceeds of $24,799,786. The Company incurred issuance costs of $10,935 in connection with the second tranche of Series B Preferred Stock.

The rights and preferences of the Series A Preferred Stock and Series B Preferred Stock (“Preferred Stock”) were as described below:

Conversion

Each share of Preferred Stock may be converted at any time, at the option of the holder, into shares of Class A common stock, subject to the applicable conversion rate as determined by dividing the original issue price by the conversion price. The conversion price for the Series A Preferred Stock and Series B Preferred Stock (as may be adjusted for certain customary dilutive events) is $6.1081 and $7.3416, respectively. The Preferred Stock automatically convert into shares of Class A common stock at the then effective conversion rate upon the closing of a public offering of the Company’s securities with gross proceeds to the Company of at least $75,000,000 and a share price of at least $7.3416 or at the election of the holders of the Requisite Holders.

Holders of Series B Preferred Stock that would beneficially own at least 9.9% of any then outstanding class of equity securities may elect to receive a portion of their converted Series B Preferred Stock as Class B common stock upon conversion.

Upon the closing of the IPO on August 3, 2021, all 8,528,078 shares of the Company’s convertible preferred stock then outstanding automatically converted into 11,939,281 shares of Class A common stock.

Dividends

Preferred Stockholders are entitled to receive per annum dividends of 7% of the original issue price share, payable only when, as and if declared by the Board of Directors. The right to receive these dividends is not cumulative, and therefore, if not declared in any year, the right to receive such dividends shall terminate and not carry forward into the next year. As of December 31, 2021 and December 31, 2020, no dividends had been declared.

Voting Rights

Preferred Stock and common stock vote together as one class on an as converted basis. Common stock voting rights on certain matters are subject to the powers, preferences, and rights of the Preferred Stock. Preferred Stockholders are entitled to vote on all matters and shall have the number of votes equal to the number of shares of common stock into which the shares of Preferred Stock held by such holder are then convertible. As long as 2,132,029 shares of Preferred Stock are outstanding, certain actions such as mergers, acquisition, liquidation, dissolution, wind up of business, and deemed liquidation events, must be approved by the holders of at least a majority of the then-outstanding shares of Preferred Stock.

Liquidation Preference

Upon liquidation, dissolution, or winding up of business, holders of Preferred Stock are entitled to receive a liquidation preference in priority to holders of common stock at the original respective Preferred Stock issue price for such series. If assets available for distribution are insufficient to satisfy the liquidation payment to holders of Preferred Stock in full, assets available for distribution will be allocated among holders of Preferred Stock on a pari passu basis at an amount per share equal to the greater of the respective original Preferred Stock issue price for such series plus any declared but unpaid dividends or such amount had all shares been converted to common stock.

When holders of Preferred Stock are satisfied in full, any excess assets available for distribution will be allocated ratably among common stock holders based on their pro rata shareholdings. Upon a deemed liquidation event, as defined in the articles of incorporation, holders have the option to redeem their shares at the liquidation payment amounts summarized above.

Redemption

Other than described above, the shares of Preferred Stock are not redeemable.