Authorized Shares

The Company is authorized to issue 40,000,000 shares of common stock, $0.01 par value, and 10,000,000 shares of preferred stock, $0.01 par value. To date, the Company has designated the following preferred stock: Series A (4,200 shares), Series B (2,360 shares), Series C (590 shares), Series D (10,000 shares), Series E (40,000 shares) and Series

E-1

(12,960 shares).

Preferred Stock

Series E and Series

E-1

Convertible Preferred Stock

During the years ended December 31, 2021, 9,274 shares of Series E and Series

E-1

Convertible Preferred Stock were converted into 927,379 shares of the Company’s common stock.

As of December 31, 2022, there were an aggregate of 11,357 shares of Series E and Series

E-1

Convertible Preferred Stock outstanding.

Equity Offerings and Placements

At-the-Market

Offering

On August 18, 2020, the Company entered into a sales agreement with Cantor Fitzgerald & Co. (“Cantor Fitzgerald”), pursuant to which the Company may offer and sell, from time to time, through Cantor Fitzgerald, as sales agent or principal, shares of the Company’s common stock, (the “Placement Shares”), having an aggregate offering price of up to $10 million (the “ATM Offering”). On November 9, 2021 the Company filed a supplement to increase the aggregate amount to

$25

million. On February 27, 2023, filed an amendment to change the aggregate offering price to the limit of

$17

million.

The Company has no obligation to sell any Placement Shares under the sales agreement. Subject to the terms and conditions of the sales agreement, Cantor Fitzgerald is required to use commercially reasonable efforts, consistent with its normal trading and sales practices, applicable state and federal law, rules and regulations and the rules of the Nasdaq Stock Market, to sell Placement Shares from time to time based upon the Company’s instructions, including any price, time or size limits specified by the Company. The Company will pay Cantor Fitzgerald a commission of 3.0% of the aggregate gross proceeds from each sale of Placement Shares, reimburse Cantor Fitzgerald’s legal fees and disbursements up to $50 and provide Cantor Fitzgerald with customary indemnification and contribution rights. The sales agreement may be terminated by Cantor Fitzgerald or the Company upon notice to the other party as provided in the sales agreement, or by Cantor Fitzgerald at any time in certain circumstances, including the occurrence of a material and adverse change in the Company’s business or financial condition that makes it impractical or inadvisable to market the Placement Shares or to enforce contracts for the sale of the Placement Shares.

In connection with the ATM Offering, in consideration for a fee equal to 1.05% of the gross sales price per share sold in the ATM Offering, ROTH Capital Advisors, LLC (“Roth”) waived, solely with respect to the ATM Offering, (i) Roth’s right, pursuant to certain engagement letters dated August 14, 2019 and January 13, 2020 between Roth and the Company, to act as placement agent or underwriter with respect to offerings of the Company’s securities and to receive a minimum of 35% of the fees paid to the agents or underwriters for such offerings and (ii) the

lock-up

provision included in a certain underwriting agreement dated May 1, 2020 between Roth and the Company requiring the prior written consent of Roth for any offer or sale of the Company’s common stock by the Company during the

90-day

period following the date of such underwriting agreement.

During the year ended December 31, 2021, the Company sold

515,000

shares of common stock pursuant to the ATM Offering for aggregate gross proceeds of $4

million

, partially offset by $121 of issuance costs. There were no shares sold year ended December 31, 2022.

Private Placement

On July 20, 2022, the Company closed a private placement for the issuance and sale of 690,954 shares of common stock and 566,751

pre-funded

warrants to purchase common stock to certain investors. Each share of common stock was sold at a price per share of $3.98 and the

pre-funded

warrants were sold at a price of $3.97 per

pre-funded

warrant. The

pre-funded

warrants have an exercise price of $0.01 per share of common stock and are immediately exercisable. The Company received gross proceeds from the private placement of approximately $5.0 million before deducting offering expenses.

On December 13, 2022, the Company closed a private placement for the issuance and sale of 1,448,889 shares of common stock and 692,042

pre-funded

warrants to purchase common stock to certain investors. Each share of common stock was sold at a price per share of $2.90 and the

pre-funded

warrants were sold at a price of $2.89 per

pre-funded

warrant. The

pre-funded

Other Common Stock Issuances

In February 2021, the Company issued 2,636 shares of unregistered common stock in lieu of a cash payment of deferred accrued director fees to a former director.

During the year ended December 31, 2021, the Company issued 465,173 shares of common stock associated with the exercise of warrants, including 215,000

pre-funded

warrants at an exercise price of $0.01 per share, for aggregate cash proceeds of $2.5

million

Stock Incentive Plans

The Company’s 2019 Equity Incentive Plan (the “2019 Plan”) allows for grants in the form of incentive stock options, nonqualified stock options, stock units, stock awards, stock appreciation rights, and other stock-based awards. All of the Company’s officers, directors, employees, consultants, and advisors are eligible to receive grants under the 2019 Plan. The 2019 Plan provides for the grant of options to purchase shares of common stock at exercise prices not less than 100% of fair value on the dates of grant. The maximum number of shares reserved for issuance under the 2019 Plan was 2,142. The 2019 Plan has been superseded by the 2020 Plan discussed below and no further awards will be made under the 2019 Plan; however, outstanding awards granted under the 2019 Plan will remain outstanding and continue to be administered in accordance with the terms of the 2019 Plan and the applicable award agreements.

On September 30, 2020, the Company’s 2020 Omnibus Equity Incentive Plan (the “2020 Plan”) was adopted by the Company’s Board of Directors. On November 23, 2020, the Company’s stockholders approved the 2020 Plan. The 2020 Plan will continue in effect until the tenth anniversary of the date of its adoption by the Board or until earlier terminated by the Board. The 2020 Plan is administered by the Board of Directors or a committee designated by the Board of Directors. The 2020 Plan provides for the grant of

incentive stock options,

non-qualified

stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance awards, as well as other stock-based awards or cash awards that are deemed to be consistent with the purposes of the plan to Company employees, directors and consultants. As of December 31, 2022, there are 2,475,000 shares of common stock reserved under the 2020 Plan, of which 870,508 remained available to be issued.

Stock Options

The Company values stock options using the Black-Scholes option pricing model and used the following assumptions during the reporting periods:


	Years Ended December 31
	2022	2021
Expected terms (years)	0.7 - 8.4	5.1 - 6.3
Expected volatility	166.4% -180.3%	177.% - 181.3%
Risk-free interest rate	1.2% - 4.4%	0.7% - 1.3%
Expected dividends	0.00%	0.00%

The weighted average estimated fair value of the stock options granted during the years ended December 31, 2022 and 2021 was approximately $6.05 and $9.74 per share, respectively.

The following is a summary of stock option activity for the year ended December

2022


	Number of Options			Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Outstanding at January 1, 2022		1,732,460		$	11.69
Granted		702,583			6.74
Expired		(65,690	)		10.43
Cancelled/Forfeited		(134,301	)		9.59

Outstanding at December 31, 2022		2,235,052		$	10.30		8.0	$	36

Exercisable at December 31, 2022		1,316,515		$	11.13		7.6	$	—

The following table summarizes information for stock option shares outstanding and exercisable at December 31, 2022:


			Options Exercisable
			Weighted Average
	Outstanding Number of		Remaining Option Term
Range of Exercise Prices	Options		(in years)		Number of Options
$6.24 - $53.85		2,234,553		8.0		1,316,016
$53.85+		499		6.1		499

		2,235,052		7.6		1,316,515

At December 31, 2022, there was approximately $2.8 million of aggregate unrecognized compensation expense related to employee and board stock option grants. The cost is expected to be recognized over a weighted average period of 1.6 years. For the years ended December 31, 2022 and 2021, the Company recognized compensation expense $7.9 million and $7.8 million, respectively, related to stock options granted to employees and board members, which were charged to the statement of operations as detailed below:


	Years Ended December 31,
	2022		2021
Selling, general and administrative	$	5,282	$	5,334
Research and development		2,449		2,311
Cost of goods sold		210		187

Total	$	7,941	$	7,832

Employee Stock Purchase Plan

In August 2021, the Company’s Board of Directors, with shareholder approval in May 2022, adopted the Employee Stock Purchase Plan ( the “ESPP”). The ESPP provides for a maximum of 260,295 shares of

common stock to be purchased by participating employees. Employees who elect to participate in the ESPP will be able to purchase common stock at the lower of

% of the fair market value of common stock on the first or last day of the

applicable six-month offering

period. In

January 2023

, an aggregate

15,417

shares were purchased by participating employees for the offering period of July

2022

to December

2022

. The fair value of each ESPP award of $

2.23

was estimated on the first day of the offering period using the Black-Scholes option-pricing model. The Company recognized share-based compensation expense of $

, which is equal to the fair value of the ESPP awards on a straight-line basis over the offering period.

Warrants

The following is a summary of warrant activity for the year ended December 31, 2022:


					Weighted Average
			Weighted Average		Remaining Life
	Warrants		Exercise Price		(in years)
Outstanding at January 1, 2022		3,894,498	$	9.27
Warrants issued		1,258,793		.01

Outstanding at December 31, 2022		5,153,291	$	7.01		2.8

Exercisable at December 31, 2022		5,153,291	$	7.01		2.8

The following table presents information related to stock warrants at December 31, 2022:


			Warrants Exercisable
Range of Exercise Prices	Outstanding Number of Warrants		Weighted Average Remaining Warrant Term (in years)		Number of Warrants
$0.01		1,542,548		4.4		1,542,548
$10.00		3,610,743		2.2		3,610,743

		5,153,291		2.8		5,153,291