Stockholders' Equity

6 Months Ended

Jun. 30, 2025

Stockholders’ Equity [Abstract]

Stockholders' Equity

Note 3 – Stockholders’ Equity

Series F Convertible Preferred Stock: On November 27, 2017, the Company closed on an underwritten public offering of Series F convertible preferred stock and warrants to purchase shares of common stock. The Series F convertible preferred stock has full ratchet price-based anti-dilution protection, subject to customary carve-outs, in the event of a down-round financing at a price per share below the conversion price of the Series F convertible preferred stock (which protection will expire if, during any 20 of 30 consecutive trading days, the volume weighted average price of the Company’s common stock exceeds 300% of the then-effective conversion price of the Series F convertible preferred stock and the daily dollar trading volume for each trading day during such period exceeds $7,000,000). Effective for every stock offering or reverse stock split, the conversion price of the Series F convertible preferred stock has been recalculated based on the offering price.

As of July 7, 2025 (the effective date of the most recent reverse stock split), the conversion price of the Series F convertible preferred stock was recalculated to $397.00. As of June 30, 2025 and December 31, 2024, 27 shares and 127 shares of the Series F convertible preferred stock remained outstanding, respectively.

Series F-1 Convertible Preferred Stock: On June 6, 2025, the Company filed the Certificate of Designation of Preferences, Rights and Limitations of Series F-1 Convertible Preferred Stock with the State of Delaware. At that time, 100 shares of Series F Preferred Stock were outstanding and owned by the Company’s Chief Executive Officer, John L. Erb. Such 100 shares of Series F Preferred Stock were exchanged for Series F-1 Preferred Shares pursuant to a Securities Exchange Agreement between John L. Erb and the Company, dated June 9, 2025.

On June 9, 2025, 66 shares of the Series F-1 Preferred shares were converted into 26,191 shares of the Company’s common stock. The conversion rate for the 66 Series F-1 Preferred Shares was $397.00 per share.

As of June 18, 2025, 66 of series F-1 Preferred shares had been converted to common stock and 34 remained outstanding.

June 2025 Stock Offering: On June 10, 2025, the Company announced the closing of its public offering of 61,444 shares of its common stock (“Common Stock”), pre-funded warrants to purchase 335,381 shares of Common Stock (all pre-funded warrants were exercised on this date), in each case with accompanying Series A Warrants to purchase up to 1,190,480 shares of Common Stock and Series B Warrants to purchase up to 396,829 shares of Common Stock with gross proceeds of approximately $5.0 million, which included the full exercise of the underwriter’s over-allotment option to purchase additional shares and warrants. The public offering price per share of Common Stock and accompanying warrants is $12.60 per share and accompanying warrants, and the public offering price per pre-funded warrant and accompanying warrants is $12.5958 per pre-funded warrant and accompanying warrants. Each pre-funded warrant has an exercise price of $0.0042 per pre-funded warrant, and was immediately exercisable. The Series B Warrants have an exercise price of $12.60, and will be exercisable for a period of five years following the receipt of stockholder approval, as required by the applicable rules and regulations of Nasdaq. The Series A Warrants contain a one-time reset of the exercise price in the event that the Company implemented the 2025 Reverse Stock Split equal to the greater of: (i) 20% of the combined public offering price per share of Common Stock and accompanying warrants in the offering and (ii) the lowest daily volume weighted average price for the five trading days immediately following the date of the implementation of the 2025 Reverse Stock Split. After the reverse stock split effectuated on July 3, 2025, the reset exercise price of the Series A warrants was set at $7.00 per share. The Series B Warrants include a zero cash exercise option allowing holders of a Series B Warrant the right to receive, without payment of any additional cash to the Company, an aggregate number of shares equal to the number of shares of Common Stock that would be issuable upon a cash exercise of such Series B Warrants.

The Series A and B warrants offered in this financing were determined to be classified as a liability on the condensed consolidated balance sheet.  An independent valuation of the warrants was performed and reviewed with management.  The Series A warrants were valued using the Monte Carlo Simulation Model utilizing US Treasury Rates, Volatily rates, common stock price and assumptions around date and likelihood of a reverse split exercise price adjustment.  The Series B warrants were valued using the common stock price given the zero exercise price.  The valuation at issuance was $14.5 million and at June 30, 2025, was $13.7 million, representing a warrant liability decrease of $0.8 million from issuance. The $0.8 million warrant liability decrease from issuance has been reported on the condensed consolidated  statement of operations as a “Change in fair value of warrant liability”.  The warrant valuation of $14.5 million exceeded the gross proceeds of $5.0 million.  Accordingly if the warrant valuation exceeds the gross proceeds, the difference will be recorded as ‘Day 1 interest’.  You will find this difference, along with other issuance costs (discounts, legal, printing) reported on the condensed consolidated  statement of operations as “Financing expense”.

Reverse Stock Split: The Company effectuated a one-for-thirty-five reverse stock split on June 27, 2024.

On June 19, 2025, the Board approved a one-for-forty-two reverse stock split of the Company’s issued and outstanding shares of common stock (the “2025 Reverse Stock Split”). On July 2, 2025, the Company filed with the Secretary of State of the State of Delaware a Certificate of Amendment to its Certificate of Incorporation (the “Certificate of Amendment”) to effect the 2025 Reverse Stock Split. The 2025 Reverse Stock Split became effective as of 5:00 p.m. Eastern Time on July 3, 2025, and the Company’s common stock began trading on a split-adjusted basis when the market opened on July 7, 2025. When the 2025 Reverse Stock Split became effective, every forty-two shares of the Company’s issued and outstanding common stock (and such shares held in treasury) automatically was converted into one share of common stock, without any change in the par value per share. In addition, a proportionate adjustment was made to the per share exercise price and the number of shares issuable upon the conversion of the Company’s outstanding shares of preferred stock and exercise of all outstanding stock options, restricted stock units and warrants to purchase shares of common stock and the number of shares reserved for issuance pursuant to the Company’s equity incentive compensation plans. Any fraction of a share of common stock that was created as a result of the 2025 Reverse Stock Split was rounded down to the next whole share and the stockholder received cash equal to the market value of the fractional share, determined by multiplying such fraction by the closing sales price of the Company’s common stock as reported on Nasdaq on the last trading day before the 2025 Reverse Stock Split became effective. All share and per-share amounts have been retroactively adjusted to reflect the reverse stock splits for all periods presented.