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STOCKHOLDERS EQUITY
 6 Months Ended
Jun. 30, 2025
STOCKHOLDERS EQUITY  
STOCKHOLDERS' EQUITY

NOTE 5 – STOCKHOLDERS’ EQUITY

 

Share Repurchase Program

 

On June 12, 2023, the Company announced that its Board of Directors has approved a share repurchase program. The program authorizes the Company to repurchase up to $2 million of its shares of common stock, in the open market or through privately negotiated transactions, in accordance with applicable securities laws and other restrictions. The manner, timing and amount of any purchase will be based on an evaluation of market conditions, the Company’s stock price and other factors. The program has no termination date, may be suspended or discontinued at any time, and does not obligate the Company to acquire any particular number of shares of common stock. During the six months ended June 30, 2025, the Company repurchased a total of 5,000 shares under this program for a total purchase price of $10,000, which are recorded as Treasury stock as of June 30, 2025.

 

Warrants

 

On March 6, 2025, we entered into warrant exercise inducement offer letters (the "Inducement Letters") with the holders (the "Holders") of warrants to purchase an aggregate of 837,104 shares of our Common Stock originally issued on October 23, 2024 (collectively, the "Existing Warrants"), pursuant to which the Holders agreed to exercise the Existing Warrants at their current exercise price of $4.42 per share, in exchange for our agreement to issue the Holders new warrants to purchase an aggregate of 1,674,208 shares of common stock (the "Inducement Warrants"). The Inducement Warrants have an exercise price of $3.75 per share, became granted and exercisable when we obtained stockholder approval for the issuance of the shares of Common Stock underlying the Inducement Warrants on May 5, 2025, and are exercisable for a period of five years following the approval date. As the Inducement Warrants were considered offering costs, the Company has recorded both an increase and decrease to additional paid-in capital of approximately $3.9 million representing the difference between the fair market value of the Existing Warrants and Inducement Warrants on the date of the transaction. There was no net impact on total equity as a result.

 

The transaction closed on March 6, 2025, resulting in total net proceeds to the Company of approximately $3.7 million after deducting placement agent fees and other costs of the offering. The net proceeds received by the Company will be used for working capital and general corporate purposes.

 

Roth Capital Partners, LLC (“Roth”) acted as the Company’s financial advisor in connection with the transaction described above. Pursuant to a financial advisory agreement with Roth, the Company (i) paid Roth a financial advisory fee equal to 8% of the aggregate gross proceeds received from the exercise of the Existing Warrants, (ii) reimbursed Roth $40,000 for its legal expenses and (iii) issued Roth a warrant (the “Advisor Warrant”) to purchase 125,566 shares of common stock (being equal to 5.0% of the aggregate number of shares of common stock issuable upon exercise of the Existing Warrants and the Inducement Warrants). The Advisor Warrant has the same terms as the Inducement Warrants.

 

As of June 30, 2025, and 2024, warrants to purchase 4,147,478 and 2,284,932 shares of common stock were outstanding respectively.

 

Warrant activity, which includes the Inducement Warrants for presentation purposes, for the six-months ended June 30, 2025 consists of the following:

 

 

 

Warrants

 

 

Weighted

Average

Exercise

Price

 

 

Weighted

Average

Life

Remaining

 

Outstanding, December 31, 2024

 

 

3,184,808

 

 

$

20.30

 

 

 

2.95

 

Issuances

 

 

1,799,774

 

 

 

3.75

 

 

 

-

 

Exercises

 

 

(837,104

)

 

 

4.42

 

 

 

-

 

Outstanding, June 30, 2025

 

 

4,147,478

 

 

$

16.32

 

 

 

3.12

 

 

Assumptions used in calculating the fair value of the warrants issued in 2025 were as follows:

 

 

 

Range of

Inputs 

Used

 

Annual dividend yield

 

$-

 

Expected life (years)

 

 

5.0

 

Risk-free interest rate

 

 

4.04%

Expected volatility

 

 

166.00%

Common stock price

 

$4.56