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Note 11 - Common Stock Warrants

6 Months Ended

Jun. 30, 2024

Stockholders' Equity Note, Warrants or Rights Disclosure [Text Block]

NOTE 11. COMMON STOCK WARRANTS

See Notes 2, “Summary of Significant Accounting Policies”; 3, “Fair Value Measurements”; 9, “Financing Activities”; and 12, “Stockholders’ (Deficit) Equity” for certain defined terms below and additional discussion of financing activities and related accounting policies and fair value estimates.

June 2024 Warrants

In June 2024, in conjunction with the 2024 Warrant Reprice Transaction, the Company issued new common stock purchase warrants (the “June 2024 Warrants”) exercisable for 90,381 shares of common stock for $2.57 per share through December 17, 2029.

March 2024 Warrant

In March 2024, the Company executed the First Amendment and Subsidiary Guarantee Consent as part of the 2024 Subsidiary Guarantee Termination with holders of the Secured Convertible Notes (see Note 10, “Convertible Notes”) in order to close the DERMAdoctor Divestiture (see additional discussion in Note 9, “Financing Activities” and Note 18, “Divestiture and Discontinued Operations”). In exchange for the consent of each holder, the option, at the holder’s election, to receive upon the closing of the DERMAdoctor sale either, a new common stock warrant (the “March 2024 Warrant”), or a new unsecured convertible note (see additional discussion in Note 18, “Divestiture and Discontinued Operations”). One holder elected the option to receive a March 2024 Warrant exercisable for 28,572 shares of common stock for $4.90 per share.

The March 2024 Warrant was initially classified as a liability from the date of issuance until Company stockholder approval on May 28, 2024, at which time it was reclassified to equity.

December 2023 Warrants

In December 2023, in conjunction with the 2023 Warrant Reprice Transaction, the Company issued new common stock purchase warrants (the “December 2023 Warrants”) exercisable for 72,256 shares of common stock for $8.75 per share through June 21, 2029.

The December 2023 Warrants were initially classified as liabilities from the date of issuance until Company stockholder approval on May 28, 2024, at which time it was reclassified to equity.

May 2023 Warrants

In May 2023, in conjunction with the 2023 Private Placement, the Company issued the following new common stock purchase warrants (collectively, the “May 2023 Warrants”):

	●	May 2023 Series B-1 Warrants exercisable for 72,528 shares of common stock for $45.50 per share through June 9, 2028 (“*May 2023 B-1 Warrants*”); and
	●	May 2023 Series B-2 Warrants exercisable for 72,528 shares of common stock for $45.50 per share through June 9, 2025 (“*May 2023 B-2 Warrants*”).

In December 2023, in conjunction with the 2023 Warrant Reprice Transaction, the Company amended certain May 2023 Warrants to reduce their exercise prices to $8.75. Immediately after amendment, the following May 2023 Warrants were exercised (while any unexercised May 2023 Warrants maintained an exercise price of $45.50):

	●	May 2023 B-1 Warrants exercisable for 18,132 shares of common stock; and
	●	May 2023 B-2 Warrants exercisable for 54,120 shares of common stock.

In June 2024, in conjunction with the 2024 Warrant Reprice Transaction, the Company amended certain May 2023 Warrants to reduce their exercise prices to $2.50. Immediately after amendment, the following May 2023 Warrants were exercised (while any unexercised May 2023 Warrants maintained an exercise price of $8.75):

	●	May 2023 B-1 Warrants exercisable for 54,396 shares of common stock; and
	●	May 2023 B-2 Warrants exercisable for 18,408 shares of common stock.

For the amendments in December 2023 and June 2024, the Company recognized a loss on modification of common stock warrants related to the May 2023 Warrants of $170 thousand and $47 thousand, respectively.

November 2022 Warrants

In November 2022, in conjunction with the 2022 Private Placement, the Company issued the following common stock purchase warrants (collectively, the “November 2022 Warrants”):

	●	November 2022 Series A-1 Warrants exercisable for 14,741 shares of common stock for $220.50 per share through November 20, 2028 (“*November 2022 A-1 Warrants*”); and
	●	November 2022 Series A-2 Warrants exercisable for 14,741 shares of common stock for $220.50 per share through May 20, 2024 (“*November 2022 A-2 Warrants*”).

In May 2023, in conjunction with the 2023 Private Placement, the Company amended certain November 2022 Warrants to reduce their exercise prices from $220.50 to $52.50 as follows:

	●	November 2022 A-1 Warrants exercisable for 12,473 shares of common stock; and
	●	November 2022 A-2 Warrants exercisable for 12,473 shares of common stock.

In May 2024, all November 2022 Series A-2 Warrants for 14,741 shares of common stock remained unexercised and expired.

In June 2024, in conjunction with the 2024 Warrant Reprice Transaction, the Company amended certain November 2022 Warrants to reduce their exercise prices from $52.50 to $2.50 as follows:

●

November 2022 A-1 Warrants exercisable for 12,473 shares of common stock.

For the amendments in May 2023 and June 2024, the Company recognized a loss on modification of common stock warrants related to the November 2022 Warrants of $74 thousand and $16 thousand, respectively.

September 2022 Warrants

In September 2022, in conjunction with the warrant reprice transaction (the “2022 Warrant Reprice Transaction”), the Company issued new common stock purchase warrants (the “September 2022 Warrants”) exercisable for 9,371 shares of common stock for $220.50 per share through September 11, 2028.

In May 2023, in conjunction with the 2023 Private Placement, the Company amended certain September 2022 Warrants exercisable for 6,819 shares of common stock to reduce their exercise prices from $220.50 to $52.50.

In June 2024, in conjunction with the 2024 Warrant Reprice Transaction, the Company amended certain September 2022 Warrants exercisable for 5,104 shares of common stock to reduce their exercise prices from $52.50 to $2.50.

For the amendments in May 2023 and June 2024, the Company recognized a loss on modification of common stock warrants related to the September 2022 Warrants of $28 thousand and $6 thousand, respectively.

November 2021 Warrants

In November 2021, in conjunction with a private placement transaction, the Company issued the new common stock purchase warrants (the “November 2021 Warrants”) exercisable for 30,616 shares of common stock for $649.25 per share through March 9, 2023.

In September 2022, in conjunction with the 2022 Warrant Reprice Transaction, the Company amended all November 2021 Warrants to reduce their exercise prices from $649.25 to $220.50 and extend their termination date to September 11, 2028. Immediately after amendment, November 2021 Warrants were exercised for 7,654 shares of common stock.

In May 2023, in conjunction with the 2023 Private Placement, the Company amended certain November 2021 Warrants exercisable for 15,308 shares of common stock to reduce their exercise prices from $220.50 to $52.50.

For the amendments in September 2022 and May 2023, the Company recognized a loss on modification of common stock warrants related to the November 2021 Warrants of $1.5 million and $0.1 million, respectively.

July 2020 Warrants

In July 2020, in conjunction with a private placement transaction, the Company issued the new common stock purchase warrants (the “July 2020 Warrants”) exercisable for 5,635 shares of common stock for $2,021.25 per share through January 22, 2026.

In September 2022, in conjunction with the 2022 Warrant Reprice Transaction, the Company amended certain July 2020 Warrants exercisable for 3,921 shares of common stock to reduce their exercise prices from $2,021.25 to $220.50. Immediately after amendment, July 2020 Warrants were exercised for 1,715 shares of common stock.

In May 2023, in conjunction with the 2023 Private Placement, the Company amended certain July 2020 Warrants exercisable for 2,206 shares of common stock to reduce their exercise prices from $220.50 to $52.50.

For the amendments in September 2022 and May 2023, the Company recognized a loss on modification of common stock warrants related to the July 2020 Warrants of $0.4 million and $9 thousand, respectively.

Summary of Common Stock Warrant Activity and Outstanding

Activity related to common stock warrants outstanding at June 30, 2024 and 2023 were as follows:

	Warrants			Weighted- Average Exercise Price
Outstanding at December 31, 2022		65,886		$	269.54
Warrants granted		145,056			45.50
Warrants exercised		—			—
Warrants expired		—			—
Outstanding at June 30, 2023		210,942			76.23

Outstanding at December 31, 2023		210,946		$	50.96
Warrants granted		118,953			3.13
Warrants exercised		(90,381	)		2.50
Warrants expired		(14,741	)		78.35
Outstanding at June 30, 2024		224,777			37.40

Common stock warrants outstanding as of June 30, 2024 were as follows:

Series	Exercise Price		Expiration Date	Warrants
2019 Ladenburg Warrants	$	1,212.75	August 8, 2024		138
July 2020 Warrants	$	2,021.25	January 22, 2026		1,714
July 2020 Warrants	$	52.50	January 22, 2026		2,206
TLF Warrants	$	822.96	January 15, 2026		13
November 2021 Warrants	$	220.50	September 11, 2028		7,654
November 2021 Warrants	$	52.50	September 11, 2028		15,308
September 2022 Warrants	$	220.50	September 11, 2028		2,552
September 2022 Warrants	$	52.50	September 11, 2028		1,715
November 2022 A-1 Warrants	$	220.50	November 20, 2028		2,268
December 2023 Warrants	$	8.75	June 21, 2029		72,256
March 2024 Warrant	$	4.90	March 24, 2029		28,572
June 2024 Warrants	$	2.57	December 17, 2029		90,381
Outstanding at June 30, 2024					224,777

Summary of Common Stock Warrant Liabilities

The following is a reconciliation of the beginning and ending balances for warrant liabilities measured at fair value on a recurring basis (in thousands). See additional information per Note 3, “Fair Value Measurements”, subheading “Black Scholes Valuation Models and Assumptions.”

Warrant liabilities as of December 31, 2023		334
Decrease in fair value of December 2023 Warrant liability during period		(122	)
Fair value of March 2024 Warrant upon issuance		92
Increase in fair value of March 2024 Warrant liability during period		8
Reclassification of December 2023 Warrant liability to equity during period		(212	)
Reclassification of March 2024 Warrant liability to equity during period		(100	)
Warrant liabilities as of June 30, 2024	$	—