Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 11, 2022 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2022 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-36216 | |
Entity Registrant Name | IDEAL POWER INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 14-1999058 | |
Entity Address, Address Line One | 5508 Highway 290 West, Suite 120 | |
Entity Address, City or Town | Austin | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 78735 | |
City Area Code | 512 | |
Local Phone Number | 264-1542 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | IPWR | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 5,903,797 | |
Entity Central Index Key | 0001507957 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Balance Sheets
Balance Sheets - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 20,020,712 | $ 23,170,149 |
Accounts receivable, net | 147,162 | 233,262 |
Prepayments and other current assets | 261,949 | 43,900 |
Total current assets | 20,429,823 | 23,447,311 |
Property and equipment, net | 53,265 | 56,158 |
Intangible assets, net | 2,037,412 | 2,055,650 |
Right of use asset | 278,388 | 307,172 |
Other assets | 11,189 | 11,189 |
Total assets | 22,810,077 | 25,877,480 |
Current liabilities: | ||
Accounts payable | 17,764 | 130,500 |
Accrued expenses | 499,024 | 353,507 |
Current portion of lease liability | 61,688 | 58,864 |
Total current liabilities | 578,476 | 542,871 |
Long-term lease liability | 236,195 | 267,584 |
Other long-term liabilities | 877,778 | 917,100 |
Total liabilities | 1,692,449 | 1,727,555 |
Commitments and contingencies (Note 6) | ||
Stockholders' equity: | ||
Common stock, $0.001 par value; 50,000,000 shares authorized; 5,905,118 shares issued and 5,903,797 shares outstanding at June 30, 2022 and 5,893,767 shares issued and 5,892,446 shares outstanding at December 31, 2021 | 5,905 | 5,894 |
Additional paid-in capital | 104,625,648 | 104,063,321 |
Treasury stock, at cost, 1,321 shares at June 30, 2022 and December 31, 2021 | (13,210) | (13,210) |
Accumulated deficit | (83,500,715) | (79,906,080) |
Total stockholders' equity | 21,117,628 | 24,149,925 |
Total liabilities and stockholders' equity | $ 22,810,077 | $ 25,877,480 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2022 | Dec. 31, 2021 |
Balance Sheets | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares, issued | 5,905,118 | 5,893,767 |
Common stock, shares, outstanding | 5,903,797 | 5,892,446 |
Treasury stock, shares | 1,321 | 1,321 |
Statements of Operations
Statements of Operations - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Statements of Operations | ||||
Grant revenue | $ 50,978 | $ 84,705 | $ 175,986 | $ 326,766 |
Cost of grant revenue | 50,978 | 84,705 | 175,986 | 326,766 |
Gross profit | 0 | 0 | 0 | 0 |
Operating expenses: | ||||
Research and development | 728,383 | 560,693 | 1,556,930 | 821,573 |
General and administrative | 734,637 | 603,518 | 1,587,586 | 1,204,204 |
Sales and marketing | 233,152 | 112,033 | 452,581 | 174,611 |
Total operating expenses | 1,696,172 | 1,276,244 | 3,597,097 | 2,200,388 |
Loss from operations | (1,696,172) | (1,276,244) | (3,597,097) | (2,200,388) |
Other income: | ||||
Interest income (expense), net | 6,178 | (1,856) | 2,462 | (1,862) |
Gain on forgiveness of long-term debt | 91,407 | 0 | 91,407 | |
Total other income | 6,178 | 89,551 | 2,462 | 89,545 |
Net loss | $ (1,689,994) | $ (1,186,693) | $ (3,594,635) | $ (2,110,843) |
Net loss per share - basic | $ (0.27) | $ (0.19) | $ (0.58) | $ (0.37) |
Net loss per share - diluted | $ (0.27) | $ (0.19) | $ (0.58) | $ (0.37) |
Weighted average number of shares outstanding - basic | 6,157,625 | 6,125,874 | 6,156,495 | 5,737,109 |
Weighted average number of shares outstanding - diluted | 6,157,625 | 6,125,874 | 6,156,495 | 5,737,109 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (3,594,635) | $ (2,110,843) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 89,051 | 70,343 |
Write-off of capitalized patents | 0 | 528 |
Stock-based compensation | 462,238 | 153,644 |
Stock issued for services | 100,100 | 68,680 |
Gain on forgiveness of long-term debt | 0 | (91,407) |
Decrease (increase) in operating assets: | ||
Accounts receivable | 86,100 | 37,916 |
Prepaid expenses and other assets | (189,265) | (57,663) |
Increase (decrease) in operating liabilities: | ||
Accounts payable | (112,736) | 57,123 |
Accrued expenses and other liabilities | 77,630 | 70,584 |
Net cash used in operating activities | (3,081,517) | (1,801,095) |
Cash flows from investing activities: | ||
Purchase of property and equipment | (12,248) | (32,919) |
Acquisition of intangible assets | (55,672) | (112,100) |
Net cash used in investing activities | (67,920) | (145,019) |
Cash flows from financing activities: | ||
Net proceeds from issuance of common stock | 0 | 21,204,609 |
Exercise of options and warrants | 0 | 3,301,226 |
Net cash provided by financing activities | 0 | 24,505,835 |
Net increase (decrease) in cash and cash equivalents | (3,149,437) | 22,559,721 |
Cash and cash equivalents at beginning of period | 23,170,149 | 3,157,256 |
Cash and cash equivalents at end of period | $ 20,020,712 | $ 25,716,977 |
Statements of Stockholders' Equ
Statements of Stockholders' Equity - USD ($) | Common Stock. | Additional Paid-In Capital | Treasury Stock | Accumulated Deficit | Total |
Beginning balance at Dec. 31, 2020 | $ 3,266 | $ 78,974,964 | $ (75,135,811) | $ 3,829,209 | |
Beginning balance (in shares) at Dec. 31, 2020 | 3,265,740 | ||||
Treasury Stock, beginning balance at Dec. 31, 2020 | $ (13,210) | ||||
Treasury Stock, beginning balance (in shares) at Dec. 31, 2020 | 1,321 | ||||
Issuance of shares of common stock in public offering | $ 1,353 | 21,203,256 | 21,204,609 | ||
Issuance of shares of common stock in public offering (in shares) | 1,352,975 | ||||
Exercise of options and warrants | $ 1,250 | 3,299,976 | 3,301,226 | ||
Exercise of options and warrants (in shares) | 1,250,652 | ||||
Stock issued for services | $ 4 | 68,676 | 68,680 | ||
Stock issued for services (in shares) | 4,000 | ||||
Stock-based compensation | 61,933 | 61,933 | |||
Net loss | (924,150) | (924,150) | |||
Ending balance at Mar. 31, 2021 | $ 5,873 | 103,608,805 | (76,059,961) | 27,541,507 | |
Ending balance (in shares) at Mar. 31, 2021 | 5,873,367 | ||||
Treasury Stock, ending balance at Mar. 31, 2021 | $ (13,210) | ||||
Treasury Stock, ending balance (in shares) at Mar. 31, 2021 | 1,321 | ||||
Beginning balance at Dec. 31, 2020 | $ 3,266 | 78,974,964 | (75,135,811) | 3,829,209 | |
Beginning balance (in shares) at Dec. 31, 2020 | 3,265,740 | ||||
Treasury Stock, beginning balance at Dec. 31, 2020 | $ (13,210) | ||||
Treasury Stock, beginning balance (in shares) at Dec. 31, 2020 | 1,321 | ||||
Net loss | (2,110,843) | ||||
Ending balance at Jun. 30, 2021 | $ 5,873 | 103,700,516 | (77,246,654) | 26,446,525 | |
Ending balance (in shares) at Jun. 30, 2021 | 5,873,367 | ||||
Treasury Stock, ending balance at Jun. 30, 2021 | $ (13,210) | ||||
Treasury Stock, ending balance (in shares) at Jun. 30, 2021 | 1,321 | ||||
Beginning balance at Mar. 31, 2021 | $ 5,873 | 103,608,805 | (76,059,961) | 27,541,507 | |
Beginning balance (in shares) at Mar. 31, 2021 | 5,873,367 | ||||
Treasury Stock, beginning balance at Mar. 31, 2021 | $ (13,210) | ||||
Treasury Stock, beginning balance (in shares) at Mar. 31, 2021 | 1,321 | ||||
Stock-based compensation | 91,711 | 91,711 | |||
Net loss | (1,186,693) | (1,186,693) | |||
Ending balance at Jun. 30, 2021 | $ 5,873 | 103,700,516 | (77,246,654) | 26,446,525 | |
Ending balance (in shares) at Jun. 30, 2021 | 5,873,367 | ||||
Treasury Stock, ending balance at Jun. 30, 2021 | $ (13,210) | ||||
Treasury Stock, ending balance (in shares) at Jun. 30, 2021 | 1,321 | ||||
Beginning balance at Dec. 31, 2021 | $ 5,894 | 104,063,321 | (79,906,080) | 24,149,925 | |
Beginning balance (in shares) at Dec. 31, 2021 | 5,893,767 | ||||
Treasury Stock, beginning balance at Dec. 31, 2021 | $ (13,210) | $ 13,210 | |||
Treasury Stock, beginning balance (in shares) at Dec. 31, 2021 | 1,321 | 1,321 | |||
Exercise of options | $ 1 | (1) | |||
Exercise of options (in shares) | 1,351 | ||||
Stock issued for services | $ 10 | 100,090 | $ 100,100 | ||
Stock issued for services (in shares) | 10,000 | ||||
Stock-based compensation | 231,765 | 231,765 | |||
Net loss | (1,904,641) | (1,904,641) | |||
Ending balance at Mar. 31, 2022 | $ 5,905 | 104,395,175 | (81,810,721) | 22,577,149 | |
Ending balance (in shares) at Mar. 31, 2022 | 5,905,118 | ||||
Treasury Stock, ending balance at Mar. 31, 2022 | $ (13,210) | ||||
Treasury Stock, ending balance (in shares) at Mar. 31, 2022 | 1,321 | ||||
Beginning balance at Dec. 31, 2021 | $ 5,894 | 104,063,321 | (79,906,080) | 24,149,925 | |
Beginning balance (in shares) at Dec. 31, 2021 | 5,893,767 | ||||
Treasury Stock, beginning balance at Dec. 31, 2021 | $ (13,210) | $ 13,210 | |||
Treasury Stock, beginning balance (in shares) at Dec. 31, 2021 | 1,321 | 1,321 | |||
Net loss | $ (3,594,635) | ||||
Ending balance at Jun. 30, 2022 | $ 5,905 | 104,625,648 | (83,500,715) | 21,117,628 | |
Ending balance (in shares) at Jun. 30, 2022 | 5,905,118 | ||||
Treasury Stock, ending balance at Jun. 30, 2022 | $ (13,210) | $ 13,210 | |||
Treasury Stock, ending balance (in shares) at Jun. 30, 2022 | 1,321 | 1,321 | |||
Beginning balance at Mar. 31, 2022 | $ 5,905 | 104,395,175 | (81,810,721) | $ 22,577,149 | |
Beginning balance (in shares) at Mar. 31, 2022 | 5,905,118 | ||||
Treasury Stock, beginning balance at Mar. 31, 2022 | $ (13,210) | ||||
Treasury Stock, beginning balance (in shares) at Mar. 31, 2022 | 1,321 | ||||
Stock-based compensation | 230,473 | 230,473 | |||
Net loss | (1,689,994) | (1,689,994) | |||
Ending balance at Jun. 30, 2022 | $ 5,905 | $ 104,625,648 | $ (83,500,715) | 21,117,628 | |
Ending balance (in shares) at Jun. 30, 2022 | 5,905,118 | ||||
Treasury Stock, ending balance at Jun. 30, 2022 | $ (13,210) | $ 13,210 | |||
Treasury Stock, ending balance (in shares) at Jun. 30, 2022 | 1,321 | 1,321 |
Organization and Description of
Organization and Description of Business | 6 Months Ended |
Jun. 30, 2022 | |
Organization and Description of Business | |
Organization and Description of Business | Note 1 – Organization and Description of Business Ideal Power Inc. (the “Company”) was incorporated in Texas on May 17, 2007 under the name Ideal Power Converters, Inc. The Company changed its name to Ideal Power Inc. on July 8, 2013 and re-incorporated in Delaware on July 15, 2013. With headquarters in Austin, Texas, the Company is focused on the further development and commercialization of its Bidirectional bipolar junction TRANsistor (B-TRAN™) solid state switch technology. Since its inception, the Company has financed its research and development efforts and operations primarily through the sale of common stock and warrants. The Company’s continued operations are dependent upon, among other things, its ability to obtain adequate sources of funding through future revenues, securities offerings, debt financing, co-development agreements, government grants, sale or licensing of developed intellectual property or other alternatives. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 2 – Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) for Form 10-Q. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. The balance sheet at December 31, 2021 has been derived from the Company’s audited financial statements included in its Annual Report on Form 10-K filed with the SEC on March 25, 2022. In the opinion of management, these financial statements reflect all normal recurring, and other adjustments, necessary for a fair presentation. These financial statements should be read in conjunction with the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Operating results for interim periods are not necessarily indicative of operating results for an entire fiscal year or any other future periods. Net Loss Per Share In accordance with Accounting Standards Codification 260, shares issuable for little or no cash consideration are considered outstanding common shares and included in the computation of basic net loss per share. As such, for the three and six months ended June 30, 2022 and 2021, the Company included pre-funded warrants to purchase 253,828 shares of common stock in its computation of net loss per share. The pre-funded warrants were issued in November 2019 with an exercise price of $0.001 . In periods with a net loss, no common share equivalents are included in the computation of diluted net loss per share because their effect would be anti-dilutive. At June 30, 2022, potentially dilutive shares outstanding amounted to 1,400,368 shares and exclude prefunded warrants to purchase shares of common stock. Recent Accounting Pronouncements Management does not believe that any recently issued, but not yet effective, accounting standard, if adopted, would have a material impact on the Company’s financial statements. |
Intangible Assets
Intangible Assets | 6 Months Ended |
Jun. 30, 2022 | |
Intangible Assets | |
Intangible Assets | Note 3 – Intangible Assets Intangible assets, net consisted of the following: June 30, December 31, 2022 2021 (unaudited) Patents $ 1,189,513 $ 1,133,841 Other intangible assets 1,391,479 1,391,479 2,580,992 2,525,320 Accumulated amortization – patents (184,053) (158,516) Accumulated amortization – other intangible assets (359,527) (311,154) $ 2,037,412 $ 2,055,650 Amortization expense amounted to $37,098 and $73,910 for the three and six months ended June 30, 2022, respectively, and $35,177 and $58,875 for the three and six months ended June 30, 2021, respectively. Amortization expense for the succeeding five years and thereafter is $74,462 (remaining six months of 2022) 2023 2026 At June 30, 2022 and December 31, 2021, the Company had capitalized $338,464 and $306,640, respectively, for costs related to patents that have not been awarded. |
Loans
Loans | 6 Months Ended |
Jun. 30, 2022 | |
Loans | |
Loans | Note 4 – Loans In May 2020, the Company entered into a Loan Agreement and Promissory Note (collectively the "PPP Loan") with BBVA USA pursuant to the Paycheck Protection Program (the "PPP") under the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") administered by the U.S. Small Business Administration ("SBA"). The Company received total proceeds of $91,407 from the unsecured PPP Loan. The PPP Loan was scheduled to mature in May 2022 and had an interest rate of 1.00% per annum and was subject to the terms and conditions applicable to loans administered by the U.S. Small Business Administration under the CARES Act. In accordance with the requirements of the CARES Act and the PPP, the Company used the proceeds from the PPP Loan primarily for payroll costs. The Company applied for forgiveness of the PPP Loan during the first quarter of 2021. In May 2021, the SBA approved forgiveness of the Company's PPP Loan in the principal amount of $91,407, including accrued interest. The $91,407 gain on forgiveness of the PPP Loan is shown in other income (expenses) in the financial statements for the three and six months ended June 30, 2021 and represents a non-cash financing activity. |
Lease
Lease | 6 Months Ended |
Jun. 30, 2022 | |
Lease | |
Lease | Note 5 – Lease The Company previously leased 14,782 square feet of office and laboratory space located in Austin, Texas and subleased approximately seventy-five percent (75%) of this space to a third party. This lease and sublease expired concurrently on May 31, 2021. In March 2021, the Company entered into a lease agreement for 4,070 square feet of office and laboratory space located in Austin, Texas. The commencement of the lease occurred on June 1, 2021 and the initial term of the lease is 63 months. The actual base rent in the first year of the lease was $56,471 and was net of $18,824 in abated rent over the first three months of the lease term. The annual base rent in the second year of the lease is $77,330 and increases by $2,035 in each succeeding year of the lease. In addition, the Company is required to pay its proportionate share of operating costs for the building under this triple net lease. The lease contains a 5-year fair market renewal option. It does not contain a termination option. The Company recognized a right of use asset of $339,882 and a corresponding lease For purposes of calculating the right of use asset and lease liability included in the Company’s financial statements, the Company estimated its incremental borrowing rate at 6% per annum. Future minimum payments under the lease are as follows: For the Year Ended December 31, 2022 (remaining) $ 38,666 2023 78,517 2024 80,552 2025 82,587 2026 56,132 Total lease payments 336,454 Less: imputed interest (38,571) Total lease liability $ 297,883 At June 30, 2022, the remaining lease term was 50 months. For the three months ended June 30, 2022 and 2021, operating cash flows for lease payments totaled $18,993 and $39,534, respectively, and for the six months ended June 30, 2022 and 2021, operating cash outflows for lease payments totaled $37,817 and $89,423, respectively. For the three months ended June 30, 2022 and 2021, operating lease cost, recognized on a straight-line basis, totaled $19,017 and $38,664, respectively, and for the six months ended June 30, 2022 and 2021, operating lease cost, recognized on a straight-line basis, totaled $38,035 and $87,152, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 6 – Commitments and Contingencies License Agreement In 2015, the Company entered into licensing agreements which expire in February 2033. Pursuant to these agreements, the Company has an exclusive royalty-free license associated with semiconductor power switches which enhances its intellectual property portfolio. The agreements include both fixed payments, all of which were paid prior to 2017, and ongoing variable payments. The variable payments are a function of the number of associated patent filings pending and patents issued under the agreements. The Company will pay $10,000 for each patent filing pending and $20,000 for each patent issued annually with one-half the annual payment due within 20 days of December 21 st st At June 30, 2022 and December 31, 2021, the other long-term liability for the estimated present value of future payments under the licensing agreements was $877,778 and $917,100, respectively. The Company is accruing interest for future payments related to the issued patents associated with these agreements. Legal Proceedings The Company may be subject to litigation from time to time in the ordinary course of business. The Company is not currently party to any legal proceedings. Indemnification Obligations The employment agreements of Company executives include an indemnification provision whereby the Company shall indemnify and defend, at the Company’s expense, its executives so long as an executive’s actions were taken in good faith and in furtherance of Company’s business and within the scope of executive’s duties and authority. COVID-19 Pandemic As of the date of these financial statements, the COVID-19 pandemic continues to spread throughout the United States and the rest of the world. The ultimate extent of the impact of COVID-19 on the financial performance of the Company will depend on future developments, including, among other things, the duration and spread of COVID-19 and its related variants, the timing, scope and efficacy of vaccination efforts, additional governmental restrictions in response to the COVID-19 pandemic and the overall economy, all of which are highly uncertain and cannot be predicted. If the COVID-19 pandemic contributes to additional significant volatility in the global financial markets in the future, the Company’s ability to raise additional capital, if necessary, on acceptable terms or at all, may be impacted, though such risk has not materialized to date. If the financial markets and/or the overall economy are negatively impacted for an extended period, the Company’s operating results may be materially and adversely affected. |
Common Stock
Common Stock | 6 Months Ended |
Jun. 30, 2022 | |
Common Stock | |
Common Stock | Note 7 — Common Stock Public Offering In February 2021, the Company issued and sold 1,352,975 shares of its common stock, including 176,475 additional shares of common stock pursuant to the exercise of the underwriter’s option to purchase additional shares in full, in an underwritten public offering at a price of $17.00 per share (the “Public Offering”). The net proceeds to the Company from the Public Offering were $21.2 million. The Company is utilizing, and expects to continue to utilize, the net proceeds from the Public Offering to fund commercialization and development of its B-TRAN™ technology and general corporate and working capital purposes. Stock Issuances In January 2022, the Company issued 10,000 unregistered shares of common stock, valued at $100,100 at the time of issuance, to a third-party vendor as compensation for services performed. In February 2021, the Company issued 4,000 unregistered shares of common stock, valued at $68,680 at the time of issuance, to a third-party vendor as compensation for services performed. |
Equity Incentive Plan
Equity Incentive Plan | 6 Months Ended |
Jun. 30, 2022 | |
Equity Incentive Plan | |
Equity Incentive Plan | Note 8 — Equity Incentive Plan In May 2013, the Company adopted the 2013 Equity Incentive Plan (as amended and restated, the “Plan”) and reserved shares of common stock for issuance under the Plan, which was last amended in June 2021. The Plan is administered by the Compensation Committee of the Company’s Board of Directors (the “Board”). At June 30, 2022, 394,979 shares of common stock were available for issuance under the Plan. A summary of the Company’s stock option activity and related information is as follows: Weighted Weighted Average Average Remaining Stock Exercise Life Options Price (in years) Outstanding at December 31, 2021 492,886 $ 7.35 7.6 Granted 41,062 $ 10.32 Exercised (3,750) $ 5.36 Forfeited (16,250) $ 9.33 Outstanding at June 30, 2022 513,948 $ 7.54 7.0 Exercisable at June 30, 2022 404,426 $ 6.64 6.5 During the six months ended June 30, 2022, the Company granted 31,062 stock options to Board members and 10,000 stock options to employees under the Plan. The estimated fair value of these stock options, calculated using the Black-Scholes option valuation model, was $305,890, of which $105,488 was recognized during the six months ended June 30, 2022. In January 2022, the Compensation Committee of the Board approved a modification of stock option grants to David Eisenhaure, the Company’s former Chairman of the Board, who passed away in October 2021. The modification extended the post-termination exercise period of his vested stock option grants from 12 months to 5 years. During the six months ended June 30, 2022, the Company recognized $49,327 of expense related to this modification. At June 30, 2022 and December 31, 2021, there were 100,000 unvested restricted stock units (“RSUs”) outstanding. No RSUs were granted, vested or forfeited during the six months ended June 30, 2022 At June 30, 2022, there was $1,539,738 of unrecognized compensation cost related to non-vested equity awards granted under the Plan. That cost is expected to be recognized over a weighted average period of 1.1 years. |
Warrants
Warrants | 6 Months Ended |
Jun. 30, 2022 | |
Warrants | |
Warrants | Note 9 — Warrants At June 30, 2022 and December 31, 2021, the Company had 786,420 warrants outstanding at a weighted average exercise price of $5.19 per share, and 253,828 pre-funded warrants outstanding with an exercise price of $0.001 per share. The weighted average remaining life, excluding the 253,828 pre-funded warrants with no expiration date, of the outstanding warrants is 2.7 years. At June 30, 2022, all warrants are exercisable, although the warrants held by certain of the Company’s warrant holders may be exercised only to the extent that the total number of shares of common stock then beneficially owned by such warrant holder does not exceed 4.99% (or, at the investor’s election, 9.99%) of the outstanding shares of the Company’s common stock. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) for Form 10-Q. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. The balance sheet at December 31, 2021 has been derived from the Company’s audited financial statements included in its Annual Report on Form 10-K filed with the SEC on March 25, 2022. In the opinion of management, these financial statements reflect all normal recurring, and other adjustments, necessary for a fair presentation. These financial statements should be read in conjunction with the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Operating results for interim periods are not necessarily indicative of operating results for an entire fiscal year or any other future periods. |
Net Loss Per Share | Net Loss Per Share In accordance with Accounting Standards Codification 260, shares issuable for little or no cash consideration are considered outstanding common shares and included in the computation of basic net loss per share. As such, for the three and six months ended June 30, 2022 and 2021, the Company included pre-funded warrants to purchase 253,828 shares of common stock in its computation of net loss per share. The pre-funded warrants were issued in November 2019 with an exercise price of $0.001 . In periods with a net loss, no common share equivalents are included in the computation of diluted net loss per share because their effect would be anti-dilutive. At June 30, 2022, potentially dilutive shares outstanding amounted to 1,400,368 shares and exclude prefunded warrants to purchase shares of common stock. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Management does not believe that any recently issued, but not yet effective, accounting standard, if adopted, would have a material impact on the Company’s financial statements. |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Intangible Assets | |
Schedule of intangible assets, net | June 30, December 31, 2022 2021 (unaudited) Patents $ 1,189,513 $ 1,133,841 Other intangible assets 1,391,479 1,391,479 2,580,992 2,525,320 Accumulated amortization – patents (184,053) (158,516) Accumulated amortization – other intangible assets (359,527) (311,154) $ 2,037,412 $ 2,055,650 |
Lease (Tables)
Lease (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Lease | |
Schedule of future minimum payments under the lease | For the Year Ended December 31, 2022 (remaining) $ 38,666 2023 78,517 2024 80,552 2025 82,587 2026 56,132 Total lease payments 336,454 Less: imputed interest (38,571) Total lease liability $ 297,883 |
Equity Incentive Plan (Tables)
Equity Incentive Plan (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Equity Incentive Plan | |
Summary of company's stock options activity and related information | Weighted Weighted Average Average Remaining Stock Exercise Life Options Price (in years) Outstanding at December 31, 2021 492,886 $ 7.35 7.6 Granted 41,062 $ 10.32 Exercised (3,750) $ 5.36 Forfeited (16,250) $ 9.33 Outstanding at June 30, 2022 513,948 $ 7.54 7.0 Exercisable at June 30, 2022 404,426 $ 6.64 6.5 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - $ / shares | 6 Months Ended | |||
Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Nov. 30, 2019 | |
Warrants, exercise price | $ 5.19 | $ 5.19 | ||
Potentially dilutive shares outstanding (in shares) | 1,400,368 | |||
Pre Funded Warrants | ||||
Warrants issued to purchase shares of common stock | 253,828 | 253,828 | ||
Warrants, exercise price | $ 0.001 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Intangible Assets | ||
Gross intangible assets | $ 2,580,992 | $ 2,525,320 |
Intangible assets, net | 2,037,412 | 2,055,650 |
Patents | ||
Intangible Assets | ||
Gross intangible assets | 1,189,513 | 1,133,841 |
Accumulated amortization | (184,053) | (158,516) |
Other intangible assets | ||
Intangible Assets | ||
Gross intangible assets | 1,391,479 | 1,391,479 |
Accumulated amortization | $ (359,527) | $ (311,154) |
Intangible Assets - Additional
Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Intangible Assets | |||||
Amortization expense | $ 37,098 | $ 35,177 | $ 73,910 | $ 58,875 | |
Amortization expense for 2022 | 74,462 | 74,462 | |||
Amortization expense for 2023 | 148,925 | 148,925 | |||
Amortization expense for 2024 | 148,925 | 148,925 | |||
Amortization expense for 2025 | 148,925 | 148,925 | |||
Amortization expense for 2026 | 148,925 | 148,925 | |||
Amortization expense for thereafter | 1,028,786 | 1,028,786 | |||
Capitalized costs for costs related to patents that have not been awarded | $ 338,464 | $ 338,464 | $ 306,640 |
Loans (Details)
Loans (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
May 31, 2021 | May 31, 2020 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Debt Instrument [Line Items] | |||||
Gain on forgiveness of long-term debt | $ 91,407 | $ 0 | $ 91,407 | ||
PPP Loan | |||||
Debt Instrument [Line Items] | |||||
Proceeds from loan | $ 91,407 | ||||
Interest rate (as a percent) | 1% | ||||
U.S. Small Business Administration Economic Injury Disaster Loan | |||||
Debt Instrument [Line Items] | |||||
Gain on forgiveness of long-term debt | $ 91,407 | $ 91,407 |
Lease - Additional Information
Lease - Additional Information (Details) | 3 Months Ended | 6 Months Ended | |||||
May 31, 2021 ft² | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | Mar. 31, 2021 USD ($) ft² | |
Percentage of Texas facility subleased | 75% | ||||||
Annual base rent in the second year of the lease | $ 80,552 | $ 80,552 | |||||
Right of use asset | 278,388 | 278,388 | $ 307,172 | ||||
Lease liability | $ 297,883 | $ 297,883 | |||||
Remaining lease term | 50 months | 50 months | |||||
Operating lease payments | $ 18,993 | $ 39,534 | $ 37,817 | $ 89,423 | |||
Operating lease cost | $ 19,017 | $ 38,664 | $ 38,035 | $ 87,152 | |||
Office and laboratory space | |||||||
Square feet of office and laboratory space leased (in sq ft) | ft² | 14,782 | 4,070 | |||||
Initial term of the operating lease | 63 months | ||||||
Actual base rent in first year of the lease | $ 56,471 | ||||||
Abated rent | 18,824 | ||||||
Annual base rent in the second year of the lease | 77,330 | ||||||
Increase in base rent each succeeding year | $ 2,035 | ||||||
Operating lease renewal term | 5 years | ||||||
Right of use asset | $ 339,882 | ||||||
Lease liability | $ 339,882 | ||||||
Incremental borrowing rate | 6% |
Lease - Future Minimum Payments
Lease - Future Minimum Payments under the Lease (Details) | Jun. 30, 2022 USD ($) |
Master Lease | |
2022 (remaining) | $ 38,666 |
2023 | 78,517 |
2024 | 80,552 |
2025 | 82,587 |
2026 | 56,132 |
Total lease payments | 336,454 |
Less: imputed interest | (38,571) |
Total lease liability | $ 297,883 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2015 | Dec. 31, 2021 | |
Other Commitments [Line Items] | ||||
Payment for each patent issued | $ 55,672 | $ 112,100 | ||
Long-term liability for estimated present value of future payments under licensing agreement | 877,778 | $ 917,100 | ||
Licensing agreements | ||||
Other Commitments [Line Items] | ||||
Payable for each patent filing pending | $ 10,000 | |||
Payment for each patent issued | $ 20,000 | |||
Payment for each patent issue days | 20 days | |||
Long-term liability for estimated present value of future payments under licensing agreement | 877,778 | $ 917,100 | ||
Licensing agreements | Maximum | ||||
Other Commitments [Line Items] | ||||
Contractual obligation | $ 100,000 | |||
June 21st | Licensing agreements | ||||
Other Commitments [Line Items] | ||||
Payment for each patent issue days | 20 days |
Common Stock - Public Offering
Common Stock - Public Offering (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Net proceeds from offering | $ 0 | $ 21,204,609 | ||
Common Stock. | ||||
Number of shares issued and sold | 1,352,975 | |||
Common Stock. | Public Offering | ||||
Number of shares issued and sold | 1,352,975 | |||
Offering price | $ 17 | |||
Net proceeds from offering | $ 21,200,000 | |||
Common Stock. | Underwriters option | ||||
Number of shares issued and sold | 176,475 |
Common Stock - Stock Issuances
Common Stock - Stock Issuances (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2022 | Feb. 28, 2021 | Mar. 31, 2022 | Mar. 31, 2021 | |
Stock issued for services | $ 100,100 | $ 68,680 | ||
Third-party vendor | ||||
Stock issued for services | $ 100,100 | $ 68,680 | ||
Stock issued for services (in shares) | 10,000 | 4,000 |
Equity Incentive Plan - Summary
Equity Incentive Plan - Summary of Stock Option Activity and Related Information (Details) - 2013 Equity Incentive Plan - $ / shares | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Stock Options | ||
Outstanding at December 31, 2021 | 492,886 | |
Granted | 41,062 | |
Exercised (in shares) | (3,750) | |
Forfeited / Expired | (16,250) | |
Outstanding at March 31, 2022 | 513,948 | 492,886 |
Exercisable at March 31, 2022 | 404,426 | |
Weighted Average Exercise Price | ||
Outstanding at December 31, 2021 (in dollars per share) | $ 7.35 | |
Granted | 10.32 | |
Exercised (in dollars per share) | 5.36 | |
Forfeited/Expired (in dollars per share) | 9.33 | |
Outstanding at March 31, 2022 (in dollars per share) | 7.54 | $ 7.35 |
Exercisable at March 31, 2022 (in dollars per share) | $ 6.64 | |
Weighted Average Remaining Life (in years) | ||
Outstanding at March 31 | 7 years | 7 years 7 months 6 days |
Exercisable at March 31, 2022 | 6 years 6 months |
Equity Incentive Plan - Additio
Equity Incentive Plan - Additional Information (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
David Eisenhaure | ||
Equity Incentive Plan | ||
Post-termination exercise period of vested stock option | 5 years | 12 months |
Share-based compensation expense | $ 49,327 | |
Restricted Stock Units (RSUs) | ||
Equity Incentive Plan | ||
Granted | 0 | |
Unvested restricted stock options outstanding | 100,000 | 100,000 |
Unvested restricted stock options vested or forfeited | 0 | |
2013 Equity Incentive Plan | ||
Equity Incentive Plan | ||
Shares of common stock available for issuance under the Plan (in shares) | 394,979 | |
Unrecognized compensation cost related to non-vested share-based compensation arrangements | $ 1,539,738 | |
Weighted average period for recognition | 1 year 1 month 6 days | |
Granted | 41,062 | |
Estimated fair value of options granted | $ 305,890 | |
Estimated Fair Value of Stock Options Recognized | $ 105,488 | |
Unvested restricted stock options outstanding | 513,948 | 492,886 |
2013 Equity Incentive Plan | Employees | ||
Equity Incentive Plan | ||
Granted | 10,000 | |
2013 Equity Incentive Plan | Board members | ||
Equity Incentive Plan | ||
Granted | 31,062 |
Warrants - Additional Informati
Warrants - Additional Information (Details) - $ / shares | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Outstanding | 786,420 | 786,420 |
Warrants, exercise price | $ 5.19 | $ 5.19 |
Maximum Beneficial Ownership Percentage of Warrants | 4.99% | |
Maximum Beneficial Ownership Percentage of Warrants Upon Investor's Election | 9.99% | |
Pre Funded Warrants | ||
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Outstanding | 253,828 | 253,828 |
Warrants, exercise price | $ 0.001 | $ 0.001 |
Number of warrants with no expiration date | 253,828 | |
Class of Warrants, Weighted Average Remaining Life of Warrants | 2 years 8 months 12 days |