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Liquidated Damages Payable

9 Months Ended

Sep. 30, 2024

8. Liquidated Damages Payable

Liquidated damages were recorded as a result of the following: (i) certain registration rights agreements that provide for damages if the Company does not register certain shares of the Company’s common stock within the requisite time frame (the “Registration Rights Damages”); and (ii) certain securities purchase agreements that provide for damages if the Company does not maintain its periodic filings with the SEC within the requisite time frame (the “Public Information Failure Damages”).

Obligations with respect to the liquidated damages payable are summarized as follows:

Summary of Liquidated Damages

	As of September 30, 2024 (unaudited)
	Registration Rights Damages		Public Information Failure Damages		Accrued Interest		Balance
MDB common stock to be issued ⁽¹⁾	$	15	$	-	$	-	$	15
Series H convertible preferred stock		566		574		761		1,901
Convertible debentures		-		144		85		229
Series J convertible preferred stock		152		152		156		460
Series K convertible preferred stock		166		70		312		548
Total	$	899	$	940	$	1,314	$	3,153

	As of December 31, 2023
	Registration Rights Damages		Public Information Failure Damages		Accrued Interest		Balance
MDB common stock to be issued ⁽¹⁾	$	15	$	-	$	-	$	15
Series H convertible preferred stock		565		574		659		1,798
Convertible debentures		-		144		72		216
Series J convertible preferred stock		152		152		129		433
Series K convertible preferred stock		166		70		226		462
Total	$	898	$	940	$	1,086	$	2,924

⁽¹⁾	Consists of shares of common stock issuable to MDB Capital Group, LLC (“MDB”).

As of September 30, 2024 and December 31, 2023, the short-term liquidated damages payable were $3,153 and $2,924, respectively. The Company will continue to accrue interest on the liquidated damages balance at 1.0% per month based on the balance outstanding as of September 30, 2024, or $3,153, until paid. There is no scheduled date when the unpaid liquidated damages become due. The Series K convertible preferred stock remains subject to Registration Rights Damages and Public Information Failure Damages, which will accrue in certain circumstances, limited to 6% of the aggregate amount invested.

On February 8, 2023, the Company entered into a stock purchase agreement with an investor, where the Company was liable for liquidated damages, pursuant to which the Company agreed to issue 47,252 shares of its common stock at a price equal to $10.56 per share (determined based on the volume-weighted average price of the Company’s common stock at the close of trading on the sixty (60) previous trading days), to the investor in lieu of an aggregate of $499 owed in liquidated damages as of the conversion date. On February 10, 2023 and April 10, 2023, the Company issued 35,486 and 11,766 shares of its common stock, respectively, in satisfaction of the liquidated damages. The Company prepared and filed a registration statement covering the resale of these shares of the Company’s common stock issued in lieu of payment of these liquidated damages in cash. During the nine months ended September 30, 2023, the Company recorded $369 ($45 on April 10, 2023 and $324 on February 10, 2023) in connection with the issuance of shares of the Company’s common stock and a gain of $130 ($84 on April 10, 2023 and $46 on February 10, 2023) on the settlement of the liquidated damages, totaling $499, which was recorded in additional paid-in capital on the condensed consolidated statement of stockholders’ deficiency.