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STOCKHOLDERS’ EQUITY
 3 Months Ended
Mar. 31, 2023
Equity [Abstract]  
STOCKHOLDERS’ EQUITY

NOTE 4 – STOCKHOLDERS’ EQUITY

 

Common stock

 

The common stock confers upon the holders the right to receive notice to participate and vote in general meetings of the Company, and the right to receive dividends, if declared, and to participate in the distribution of the surplus assets and funds of the Company in the event of liquidation, dissolution or winding up of the Company.

 

Reverse Stock Split

 

On February 8, 2023, the Company effected a reverse stock split of its common stock at a ratio of 1 post-split share for every 20 pre-split shares. The Company’s common stock begin trading on a split-adjusted basis when the market opened on February 9, 2023 (the “Reverse Stock Split”).

 

At an annual meeting of stockholders held on December 15, 2022, the Company’s stockholders granted the Company’s Board of Directors (the “Board”), the discretion to effect a reverse stock split of the Company’s common stock through an amendment to its Amended and Restated Certificate of Incorporation at a ratio of not less than 1-for-2 and not more than 1-for-50, with such ratio to be determined by the Board.

 

At the effective time of the Reverse Stock Split, every 20 shares of the Company’s issued and outstanding common stock were converted automatically into one issued and outstanding share of common stock without any change in the par value per share. Stockholders holding shares through a brokerage account had their shares automatically adjusted to reflect the 1-for-20 Reverse Stock Split. The Reverse Stock Split affected all stockholders uniformly and did not alter any stockholder’s percentage interest in the Company’s equity, except to the extent that the Reverse Stock Split resulted in a stockholder owning a fractional share. Any fractional share of a stockholder resulting from the Reverse Stock Split was rounded up to the nearest whole number of shares. Proportional adjustments were made to the number of shares of the Company’s common stock issuable upon exercise or conversion of the Company’s equity awards, warrants and other convertible securities, as well as the applicable exercise or conversion price thereof. On February 16, 2023, the Company rounded up fractional shares to its nearest whole number of 15,726 shares.

 

All references in this Report to number of shares, price per share and weighted average number of shares of common stock outstanding prior to the Reverse Stock Split have been adjusted to reflect the Reverse Stock Split on a retroactive basis, unless otherwise noted.

 

Stock-based compensation and Options

 

During the three-month period ended March 31, 2023 and 2022, 5,459 and 0 employee options were exercised, and 0 and 6,000 options were granted, respectively. The options were granted to employees and board members and were recorded at a fair value and vested over three years. During the three-month periods ended March 31, 2023 and 2022, stock-based compensation expense of $67 and $86 was recorded for options that vested, respectively.

 

  

Shares Under

Options

  

Weighted

Average

Exercise Price

per Share

  

Weighted

Average

Remaining

Life (Years)

 
Outstanding – December 31, 2021   127,000   $31.86    7.77 
Granted   6,000    15.56    9.89 
Exercised   -    -    - 
Outstanding – March 31, 2022   133,000   $26.00    7.63 
                
Outstanding – December 31, 2022   147,619   $24.42    7.24 
Granted   -    -    - 
Exercised   (5,459)   1.40    0.24 
Outstanding – March 31, 2023   142,160   $25.31    7.50 

 

The fair value for options granted in the first quarter of 2022 is estimated at the date of grant using a Black-Scholes-Merton options pricing model with the following underlying assumptions:

 

   2022 
Price at valuation  $15.56 
Exercise price  $15.56 
Risk free interest   2.32 
Expected term (in years)   5 
Volatility   127.9 

 

 

 

The total stock-based expense recognized in the financial statements for services received from employees and non-employees is shown in the following table.

 

   2023   2022 
  

Three Months Ended

March 31,

 
   2023   2022 
Research and development   2    2 
Selling and marketing   6    6 
General and administrative   59    78 
Total  $67   $86 

 

As of March 31, 2023, the total unrecognized estimated compensation cost related to non-vested stock options granted prior to that date was $261, which is expected to be recognized over a weighted average period of approximately 1.27 years.

 

Warrants

 

For the three months ended March 31, 2023 and 2022, there were no warrants granted, exercised and/ or cancelled.

 

   Warrants 
Outstanding – December 31, 2021   115,467 
Granted   - 
Exercised   - 
Canceled   - 
Outstanding – March 31, 2022   115,467 
      
Outstanding – December 31, 2022   78,252 
Granted   - 
Exercised   - 
Canceled   - 
Outstanding – March 31, 2023   78,252