Stockholders’ Equity

6 Months Ended

Jun. 30, 2025

Equity [Abstract]

Stockholders’ Equity

6. Stockholders’ Equity

Reverse Stock Splits

To comply with Nasdaq’s minimum $1.00 per share continued listing rules, the Company filed a Certificate of Amendment to its Restated Certificate of Formation on May 16, 2025, to apply for reverse stock split of the Company’s common stock at a ratio of 1-for-5 which was effectuated on June 30, 2025 after receiving required approvals.

Preferred Stock

The Company increased authorized shares of preferred stock from 10,000,000 shares to 50,000,000 shares upon the filing of an amendment to the Company’s Certificate of Formation with the Secretary of State of Texas on November 27, 2023. No shares of preferred stock were issued and outstanding as of June 30, 2025 and December 31, 2024.

Common Stock

During the six months ended June 30, 2025, the Company issued an additional 1,182,513 shares of common stock as a result of delivering 541,174 shares to settle vested RSUs, 350,500 shares to settle vested special stock awards, 262,383 shares to settle for ATM transaction, 28,555 shares to compensate consultant but the shares were offset by fractional 99 shares paid out in cash for the reverse stock split. As of June 30, 2025, there were 4,267,990 shares of common stock legally issued and outstanding.

Warrants

As of June 30, 2025 and December 31, 2024, warrants issued and outstanding in connection with financing are summarized as below:

	June 30,		December 31,
(In number of shares)	2025		2024
Lind Warrant with exercise price from $10.80 to $22.50		240,388		240,388
Public warrant with exercise price of $106.25		35,880		35,880
Representative’s warrant with exercise price of $116.875		1,560		1,560
Placement agent warrant with exercise price of $41.25		4,125		4,125
ASE Warrant with exercise price of $22.50		100,000		100,000
Total		381,953		381,953

The Company issued the Lind Warrants on September 28, 2023 in connection with the private placement of the Lind Note. The Company further issued 4,125 shares of warrants with an exercise price of $41.25 per share to the placement agent as the agent fee. Each warrant has a contractual term of 5 years and can be exercised for the purchase of one share of common stock of the Company. The carrying amount of the Lind Warrant is nil after allocating proceeds to the Lind Note measured at fair value. The fair value of the placement agent warrant is estimated as $21,479 using the Black-Scholes Model.

As disclosed in Note 1, the Company issued public warrants together with common stock in connection with its underwritten public offering effective August 8, 2022. The Company further issued private warrants to Maxim Group LLC, as representative of the underwriter pursuant to an underwriting agreement. Each warrant has a contractual term of 5 years, expiring on August 8, 2027, and can be exercised for the purchase of one share of common stock of the Company.

The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the instruments’ specific terms and applicable authoritative guidance in ASC 480, Distinguishing Liabilities from Equity (the “ASC 480”), and ASC 815, Derivatives and Hedging (the “ASC 815”). The assessment considers whether the instruments are free standing financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common shares and whether the instrument holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent period end date while the instruments are outstanding. Management has concluded that the warrants issued in connection with the underwritten public offering and the private placement of Lind Note qualify for equity accounting treatment and are recorded as additional paid-in capital.

In addition, the warrant issued by the Company to i2China in 2020 in exchange for consulting services is accounted for under ASC 718, Compensation – Stock Compensation (see Note 8).

As of June 30, 2025, none of the warrants have been exercised nor have they expired.