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Note 12 - Stockholders' Equity
 3 Months Ended
Mar. 31, 2025
Notes to Financial Statements  
Equity [Text Block]

12.

STOCKHOLDERS’ EQUITY

 

Issuances of Common Stock

 

During the three-month periods ended March 31, 2025, and 2024, there have not been any shares of common stock issued to anyone outside the Company, except as noted in this Note 12.

 

On June 18, 2021, the stockholders approved the Employee Stock Purchase Plan. Under the terms of this plan, 43,334 shares of common stock are reserved for issuance to employees and officers of the Company at a purchase price equal to 85% of the lower of the closing price of the common stock on the first day or the last day of the offering period as reported on the Nasdaq Capital Market. Eligible employees are granted an option to purchase shares under the plan funded by payroll deductions. The Board may suspend or terminate the plan at any time, otherwise the plan expires June 17, 2031. There were no shares issued during the three-month periods ended March 31, 2025 and 2024.

 

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. Nonvested stock is expensed ratably over the term of the restriction period.

 

During the three-month periods ended March 31, 2025 and 2024, the Company issued 2,500 and 0 shares of restricted common stock, respectively, to certain employees and directors. 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 $2,525 and $0, respectively.

 

During the three-month periods ended March 31, 2025 and 2024, 7,572 and 316 shares of restricted common stock were forfeited, respectively.

 

Share based compensation for the three-month periods ended March 31, 2025 and 2024, was $52,488 and $56,793, respectively.

 

Issuances to Directors

 

During the three-month periods ended March 31, 2025, and 2024, the Company issued  8,913 and 4,287, shares of common stock to its directors in lieu of payment of board and committee fees valued at $9,002 and $9,003, respectively. 

 

Employees’ exercise options

 

During the three-month periods ended March 31, 2025 and 2024, no employee stock options were exercised.

 

3. Warrants

 

On January 15, 2025, the Company entered into a warrant exercise agreement with an existing institutional investor to exercise certain outstanding warrants to purchase an aggregate of 2,061,112 shares of the Company’s common stock, $0.0001 par value per share (the “Common Stock”), at an exercise price of $1.85 per share which were originally issued to the Investor on September 13, 2024. In consideration for the exercise of the Existing Warrants, subject to compliance with the beneficial ownership limitations included in the existing warrants, the Investor received new unregistered Series A warrants to purchase up to an aggregate of 1,545,834 shares of the Company’s Common Stock (the “Series A Warrants”) and new unregistered Series B warrants to purchase up to an aggregate of 1,545,834 shares of the Company’s Common Stock (the “Series B Warrants”, and together with the “Series A Warrants, the “New Warrants”). The New Warrants have substantially the same terms, are immediately exercisable at an exercise price of $2.15 per share, and will expire five years from the date of issuance. The Company agreed to file a resale registration statement covering the public resale of the shares of Common Stock issuable upon exercise of the New Warrants with the Securities and Exchange Commission (the “SEC”), and to use commercially reasonable efforts to have such Resale Registration Statement declared effective by the SEC within 90 calendar days following the date of the Warrant Exercise Agreement. The New Warrants each include a beneficial ownership limitation that prevents the Investor from beneficially owning more than 4.99% of the Company’s outstanding common stock at any time. The Company realized gross proceeds under the Warrant Exercise Agreement of approximately $3.8 million, prior to deducting placement agent fees and estimated offering expenses. Net proceeds are being used for working capital and general corporate purposes, including repayment of a portion of the Company’s outstanding secured note.

 

There were 777,666 prefunded warrants exercised during the three-month period ended March 31, 2024.