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Note 17 - Stockholders' Equity
 9 Months Ended
Sep. 30, 2021
Notes to Financial Statements  
Stockholders' Equity Note Disclosure [Text Block]

17.

STOCKHOLDERS’ EQUITY

 

1. Preferred Stock

 

Within the limits and restrictions provided in the Company’s Certificate of Incorporation, the Board of Directors has the authority, without further action by the shareholders, to issue up to 5,000,000 shares of preferred stock, $.0001 par value per share, in one or more series, and to fix, as to any such series, any dividend rate, redemption price, preference on liquidation or dissolution, sinking fund terms, conversion rights, voting rights, and any other preference or special rights and qualifications.

 

2. Common Stock

 

Effective November 20, 2020, the Company implemented a reverse stock split of its outstanding common stock at a ratio of 1-for-8. The number of authorized shares and the par value of the Company's common stock and preferred stock were not affected by the reverse stock split. Stockholders who otherwise would be entitled to receive fractional shares were rounded up to the nearest whole share. The reverse stock split became effective at the opening of trading on November 20, 2020.

 

Holders of common stock have equal rights to receive dividends when, as and if declared by the Board of Directors, out of funds legally available therefor. Holders of common stock have one vote for each share held of record and do not have cumulative voting rights.

 

Holders of common stock are entitled, upon liquidation of the Company, to share ratably in the net assets available for distribution, subject to the rights, if any, of holders of any preferred stock then outstanding. Shares of common stock are not redeemable and have no preemptive or similar rights. All outstanding shares of common stock are fully paid and nonassessable.

 

Issuances of Common Stock

 

On March 30, 2020, the Company issued 121,500 shares of common stock upon exercise of warrants at $12.00 per share, resulting in proceeds of $1,458,000 to the Company.

 

See Note 14 Convertible Notes Payable for common stock issuances related to conversion of convertible notes payable and shares of common stock issued for fees in connection with the agreements during fiscal 2020.

 

On July 23, 2020, the Company completed an underwritten public offering of shares of common stock and warrants resulting in net proceeds of approximately $22.7 million, after deducting underwriting discounts and commissions and estimated offering expenses. 4,264,312 shares of common stock were issued in this offering and 795,538 additional shares of common stock were issued upon the exercise of 512,500 prefunded warrants and 283,038 warrants issued in the offering.

 

Issuances of Restricted Stock

 

Restricted stock consists of shares of common stock that are subject to restrictions on transfer and risk of forfeiture until the fulfillment of specified conditions. The fair value of nonvested shares is determined based on the market price of the Company's common stock on the grant date. Restricted stock is expensed ratably over the term of the restriction period.

 

The Company issued 6,250 shares of restricted common stock to certain employees of the Company and 1,250 of shares of restricted common stock were forfeited during the nine-month period ended September 30, 2021. These shares vest in equal annual installments over a three-year period from the date of grant and had a fair value on the date of issuance of $18,456.

 

Restricted stock compensation for the three and nine-month periods ended September 30, 2021, was $18,360 and $52,081, respectively.

 

There were 38,250 shares of restricted stock issued in the three and nine-month periods ended September 30, 2020.

 

Issuances to Directors, Executive Officers & Consultants

 

During the three and nine-month period ended September 30, 2021, the Company issued 1,888 and 5,727 shares of common stock to its directors in lieu of payment of board and committee fees valued at $6,008 and $19,023, respectively. There were 1,291 and 3,434 shares of common stock issued to directors in the three and nine-month period ended September 30, 2020, respectively, valued at $7,003 and $22,010, respectively.

 

Employees’ exercise options

 

During the three and nine-month periods ended September 30, 2021 and 2020, no employee stock options were exercised.

 

3. Warrants

 

During the nine months ended September 30, 2020, the Company issued a warrant valued at $94,655 to an investor to purchase 15,625 shares for a business referral.

 

During the nine months ended September 2020, the Company issued a warrant to purchase 3,125 shares of common stock to a former employee for a business referral valued at $12,921.

 

There were no warrants issued during the three and nine-month periods ended September 30, 2021.

 

See Note 14 Convertible Notes Payable for warrants issued with convertible notes in connection with the agreements during fiscal 2020.

 

4.  Securities Purchase Agreement dated September 23, 2015

 

On September 23, 2015, the Company issued warrants (the “2015 Warrants”) to purchase 8,681 shares of common stock in connection with the issuance of a promissory note. The warrants were immediately exercisable at an initial exercise price of $28.80 per share and had a term of five years.  The 2015 Warrants expired in September 2020.

 

The 2015 Warrants had a “full ratchet” anti-dilution adjustment provision.  The anti-dilution adjustment provision was triggered in the first quarter of 2020 from the February 2020 Note and amendments to the Original Note. As a result of the forgoing transactions, the number of shares of common stock issuable upon the full exercise of the 2015 Warrants increased to 48,078, the exercise price was reduced to $5.20 per share, and the Company recorded a non-cash deemed dividend in amount of $41,688.