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EQUITY TRANSACTIONS
 6 Months Ended
Jun. 30, 2025
Equity [Abstract]  
EQUITY TRANSACTIONS

12) EQUITY TRANSACTIONS

 

Authorized Shares

 

Effective June 2, 2025, the Company filed a certificate of amendment to its Restated Certificate of Incorporation, as amended, with the Secretary of State of Delaware to increase the authorized shares of its common stock from 100,000,000 to 150,000,000. This amendment was approved by the Company’s stockholders at the Annual Meeting.

 

Private Placement

 

On March 31, 2025, the Company entered into a securities purchase agreement (the “SPA”) with certain accredited investors to sell in a private placement an aggregate of approximately 4,621,000 shares of common stock at a purchase price of $1.569 per share (or pre-funded warrants in lieu of common stock at a purchase price of $1.494 per pre-funded warrant). The pre-funded warrants will be exercisable until exercised in full at a nominal exercise of $0.075 per share and may not be exercised to the extent such exercise would cause the holder to beneficially own more than 4.99% or 9.99%, as applicable, of the Company’s outstanding common stock.

 

The SPA represents a forward sale contract obligating the Company to sell a fixed number of shares of its common stock at a fixed price per share and contains an adjustment to the settlement amount based on shareholder approval, which is not an input into the pricing of a fixed-for-fixed forward on equity shares. The Company measured the fair value of the forward sale contract as the difference between (i) the fair value of the expected shares to be purchased by the investors as of the date the Company entered into the SPA and (ii) the discounted purchase price of the shares, and recorded a liability of approximately $5.3 million at the contract inception date. The Company also recognized a corresponding $5.3 million charge to expense on the contract inception date because the fair value of the expected shares to be purchased by the investors exceeded the expected proceeds under the SPA.

 

 

During the three months ended June 30, 2025, the Company sold the following shares of common stock and pre-funded warrants under the SPA (in thousands):

 

Date  Common
Stock		   Pre-funded
Warrants		   Gross
Proceeds		 
April 2, 2025   662    34   $1,090 
June 9, 2025   3,182    622    5,921 
June 27, 2025   121    -    190 
    3,965    656   $7,201 

 

The shares sold on April 2, 2025 (the “First Closing”) represented 19.99% of the Company’s outstanding shares of common stock as of March 31, 2025. The shares sold in June 2025 (the “Second Closing”) were subject to satisfaction or waiver of certain conditions, including without limitation, receipt of stockholder approval for such issuance as required under applicable Nasdaq listing rules, which the Company received at the Annual Meeting.

 

Immediately before each settlement date, the Company remeasured the fair value of the respective forward sales contract liability and recognized the change in fair value in the accompanying condensed consolidated statement of operations. Upon settlement, the Company then reclassified the respective forward sales contract liability to additional paid-in capital. For the three and six months ended June 30, 2025, the Company recognized $0.5 million and $5.8 million, respectively, of forward sales contract expense. There was no forward sales contract expense during the three and six months ended June 30, 2024. During both the three and six months ended June 30, 2025, the Company reclassified the $5.8 million forward sales contract liability to additional paid-in capital, and at June 30, 2025, there was no forward sales contract liability balance.

 

Warrants

 

As of June 30, 2025, the Company had the following warrants outstanding:

 

  

Warrants Outstanding

(in thousands)

   Exercise
Price		   Issuance
Date		  Expiration
Date		  Classification
Q1-22 Warrants   23   $572.98   03/09/22  09/09/27   Liability
December 2022 Warrants   9   $21.45   12/02/22  06/02/28   Equity
Prefunded warrants   75   $0.075   10/29/24  None   Equity
Prefunded warrants   34   $0.075   04/02/25  None   Equity
Prefunded warrants   622   $0.075   06/09/25  None   Equity
    763               

 

As of June 30, 2025, the weighted average remaining contractual life of expiring warrants outstanding was 2.41 years and the weighted average exercise price for the expiring warrants was $411.74.

 

The following table shows the warrant activity from January 1, 2025 through June 30, 2025 (in thousands):

 

   Outstanding
January 1, 2025		   Granted   Exercised   Outstanding
June 30, 2025		 
Q1-22 Warrants   23    -    -    23 
December 2022 Warrants   9    -    -    9 
Prefunded warrants   125    656    50    731 
Total   157    656    50    763 

 

Standby Equity Purchase Agreement

 

On April 5, 2023, the Company entered into the SEPA with Lincoln Park, pursuant to which Lincoln Park committed to purchase up to $10.0 million of the Company’s common stock. The Company did not sell any shares of common stock under the SEPA during the three and six months ended June 30, 2025 or 2024. On May 1, 2025, the SEPA expired in accordance with its terms.

 

 

Stock Repurchase Program

 

In November 2024, the Company’s Board of Directors authorized a stock repurchase program (the “Repurchase Program”) of up to $1.0 million of the Company’s outstanding common stock. Under the Repurchase Program, the repurchases may be made by the Company from time to time through open market purchases, privately negotiated transactions or other means in accordance with applicable securities laws. The timing and amount of repurchases will be determined by the Company, taking into consideration market conditions, stock price, and other factors. The Repurchase Program does not have a set expiration date and may be suspended, modified or discontinued at any time without prior notice. The Company did not repurchase any of its shares under the Repurchase Program during the three and six months ended June 30, 2025. There was no such repurchase program during the three and six months ended June 30, 2024.