Capital Stock

6 Months Ended

Jun. 30, 2022

Capital Stock

Capital Stock

5.  Capital Stock

Private Placement

On May 12, 2022, the Company entered into Securities Purchase Agreements, each a Purchase Agreement, with new and existing investors, the Investors, pursuant to which the Investors agreed to purchase in a private placement an aggregate of 854,771 shares of common stock and warrants to purchase 427,390 shares of common stock, subject to adjustment as provided in the warrant agreement, the Warrants, for the aggregate purchase price of approximately $5.1 million with a purchase price per unit of $5.92, the Private Placement. Each unit consisted of one share of common stock and a warrant to purchase one half of one share of common stock,

subject to adjustment, as provided in the Warrants. The Company received an aggregate of $5.1 million net proceeds from the Private Placement by May 16, 2022.

The $5.1 million of net proceeds where allocated $3.6 million and $1.5 million to the common stock and warrants, respectively. The Company classified these warrants on its consolidated balance sheets as equity as the warrants do not have any redemption features nor a right to put for cash that is outside the control of the Company, and valued using the Black-Scholes model based on the following weighted average assumptions:

Risk-free interest rate		2.81	%
Expected volatility		127.36	%
Expected term		5	years
Expected dividend yield		—
Exercise price	$	8.88
Market value of common stock	$	5.50

During the three months ended June 30, 2021, the Company issued a total of 300,000 shares of its common stock and warrants to purchase 150,000 shares of common stock with an exercise price of $2.00 per share, at a purchase price of $2.00 per unit. Each unit consisted of one share of common stock and a warrant to purchase one half of one share of common stock. The shares and warrants were sold to a group of investors for aggregate net proceeds of approximately $0.6 million, of which, $0.5 million and $0.1 million was allocated to the common stock and warrants, respectively. The Company classified these warrants on its consolidated balance sheets as equity as the warrants do not have any redemption features nor a right to put for cash that is outside the control of the Company, and valued using the Black-Scholes model based on the following weighted average assumptions:

Risk-free interest rate		0.88	%
Expected volatility		134.3	%
Expected term		5	years
Expected dividend yield		—
Exercise price	$	2.00
Market value of common stock	$	1.21