| Stockholders’ Equity | Note
9: Stockholders’ Equity (a)
Preferred Stock The
Company is authorized to issue 5,000,000 shares of $ 0.01
par value preferred stock with such designations,
rights and preferences as may be determined by the Board. Of our authorized preferred stock, 4,000,000
shares have been designated as Series A Junior
Participating Preferred Stock and 10,000
shares have been designated as Series B Convertible
Preferred Stock. Series
A Junior Participating Preferred Stock On
May 10, 2023, the Company filed a Certificate of Increase in Delaware, increasing the number of preferred stock designated as Series
A Junior Participating Preferred Stock to 4,000,000
from 250,000
shares. As of September 30, 2024, there were
no Series A Junior Participating Preferred Stock outstanding. Series
B Convertible Preferred Stock The
Company has designated 10,000
shares of its preferred stock as Series B Convertible
Preferred Stock (the “Preferred Stock”). Each share of Preferred Stock has a par value of $ 0.01
per share and a stated value equal to $ 1,000
(the “Stated Value”). The shares
of Preferred Stock shall initially be issued and maintained in the form of securities held in book-entry form and the Depository Trust
Company or its nominee (“DTC”) shall initially be the sole registered holder of the shares of Preferred Stock. Each
share of Preferred Stock shall be convertible, at any time and from time to time from and after the Original Issue Date at the option
of the Holder thereof or at any time and from time to time on or after the second anniversary of the Original Issue Date at the option
of the Corporation, into that number of shares of common stock (subject in each case to the limitations determined by dividing the Stated
Value of such share of Preferred Stock by the Conversion Price). The conversion price for the Preferred Stock shall be equal to $ 0.20 ,
subject to adjustment herein (the “Conversion Price”). Pursuant
to a registration statement relating to a rights offering (the “Rights Offering”) declared effective by the SEC on February
14, 2019, AIM distributed to its holders of common stock and to holders of certain options and redeemable warrants as of February 14,
2019, at no charge, one non-transferable subscription right for each share of common stock held or deemed held on the record date. Each
right entitled the holder to purchase one unit, at a subscription price of $ 1,000
per unit, consisting of one share of Series B
Convertible Preferred Stock with a face value of $ 1,000
(and immediately convertible into common stock
at an assumed conversion price of $ 8.80 )
and 114 warrants with an assumed exercise price of $ 8.80 .
The redeemable warrants are exercisable for five years after the date of issuance. The net proceeds realized from the rights offering
were approximately $ 4,700,000 .
As of September 30, 2024, 689
shares of Series B Convertible Preferred Stock
had expired, and none were converted prior to expiration. (b)
Common Stock and Equity Finances The
Company has authorized shares of 350,000,000 with specific limitations and restrictions on the usage of
8,000,000 of the 350,000,000
authorized shares. As
of September 30, 2024, and December 31, 2023, there were 58,668,647
and 49,102,484
shares of common stock
issued and outstanding, respectively. Employee
Stock Purchase Plan (Not equity compensation) On
July 7, 2020, the Board approved a plan pursuant to which all directors, officers, and employees could purchase from the Company up to
an aggregate of $ 500,000
worth of shares at the market price (including
subsequent plans, the “Employee Stock Purchase Plan”). Pursuant to NYSE American rules, this plan was effective for a sixty-day
period commencing upon the date that the NYSE American approved the Company’s Supplemental Listing Application. The Company created
successive new plans following the expiration of the July 7, 2020 plan. The latest plan was approved by the Board on October 21, 2024
and expires in December 2024. During
the three months ended September 30, 2024, the Company did no t
issue any shares of its common stock as part of the employee stock purchase plan. During
the nine months ended September 30, 2024, the Company issued a total of 335,603
shares of its common stock at a price ranging
from $ 0.33
to $ 0.41
for total proceeds of approximately $ 120,000
as part of the employee stock purchase plan. During
the three months ended September 30, 2023, the Company issued a total of 62,841
shares of its common stock at a price ranging
from $ 0.44
to $ 0.67
for total proceeds of approximately $ 35,500
as part of the employee stock purchase plan. During
the nine months ended September 30, 2023, the Company issued a total of 385,424
shares of its common stock at a price ranging from $ 0.31
to $ 0.67
for total proceeds of approximately $ 135,000
as part of the employee stock purchase plan. Rights
Plan On
May 12, 2023, the Company amended and restated its November 14, 2017 Rights Plan with American Stock Transfer & Trust Company as
Rights Agent (the “Rights Plan”). Warrants
(Rights offering) On
September 27, 2019, the Company closed a public offering underwritten by A.G.P./Alliance Global Partners, LLC (the “Offering”)
of (i) 1,740,550
shares of common stock;
(ii) pre-funded warrants exercisable for 7,148,310
shares of common stock
(the “Pre-funded Warrants”), and (iii) warrants to purchase up to an aggregate of 8,888,860
shares of common stock
(the “Warrants”). In conjunction with the Offering, we issued a
Representative’s Warrant to purchase up to an aggregate of 266,665
shares of common stock (the “Representative’s
Warrant”) . The shares of common stock and Warrants were sold at a combined Offering price
of $ 0.90 ,
less underwriting discounts and commissions. Each Warrant sold with the shares of common stock represents the right to purchase one share
of common stock at an exercise price of $ 0.99
per share. The Pre-Funded
Warrants and Warrants were sold at a combined Offering price of $ 0.899 ,
less underwriting discounts and commissions. The Pre-Funded Warrants were sold to purchasers whose purchase of shares of common stock
in the Offering would otherwise result in the purchaser, together with its affiliates and certain related parties, beneficially owning
more than 4.99 %
of the Company’s outstanding common stock immediately following the consummation of the Offering, in lieu of shares of common stock.
Each Pre-Funded Warrant represents the right to purchase one share of common stock at an exercise price of $ 0.001
per share. The Pre-Funded
Warrants are exercisable immediately and may be exercised at any time until the Pre-Funded Warrants are exercised in full. A registration
statement on Form S-1, relating to the Offering was filed with the SEC and was declared effective on September 25, 2019, the net proceeds
were approximately $ 7,200,000 .
During the year ended December 31 ,
2020, 1,870,000
of the Pre-funded
Warrants were exercised and 8,873,960
Warrants were exercised.
In addition, on March 25, 2020, the Representative’s
Warrant was amended to permit exercise of such warrant to commence on March 30, 2020. These warrants were exercised on March 31, 2020,
and an aggregate of 266,665
shares were issued upon exercise of this warrant
for gross proceeds of approximately $ 264,000
and a $ 46,000
expense for the warrant modification. During
the three months ended September 30, 2024, there were no
warrants exercised and 15,000
warrants expired unexercised. During the nine
months ended September 30, 2024, 205,000
warrants were exercised, and 5,830,028
warrants expired unexercised. As of September
30, 2024 there were no warrants
outstanding and December 31, 2023 there were 152,160
post-split warrants outstanding, respectively. Equity
Distribution Agreement On
April 19, 2023, the Company entered into an Equity Distribution Agreement (the “EDA”) with Maxim Group LLC
(“Maxim”), pursuant to which the Company may sell, from time to time, shares of its common stock having an aggregate
offering price of up to $ 8,500
000 through Maxim, as agent (the
“Offering”). Sales under the EDA were registered under the S-3 Shelf Registration Statement. Under the terms of the EDA,
Maxim will be entitled to a transaction fee at a fixed rate of 3.0 %
of the gross sales price of shares sold under the EDA. During the year ended December 31, 2023, the Company sold 598,114 shares
under the EDA for total gross proceeds of approximately $ 344,000 ,
which includes a 3.0 %
fee to Maxim of $ 10,326 .
For the three months ended September 30, 2024, the Company sold 10,975 shares
under the EDA for total gross proceeds of approximately $ 4,110 ,
which includes a 3.0 %
fee to Maxim of $ 123 .
For the nine months ended September 30, 2024, the Company sold 1,305,653 shares
under the EDA for total gross proceeds of approximately $ 630,204 which
includes a 3.0 %
fee to Maxim of $ 18,906 . Unsecured
Promissory Note On February 16, 2024, the Company (“Borrower”) entered into a Note Purchase Agreement with Streeterville Capital LLC (“Streeterville”
or the “Lender”). Under the terms of the agreement, Streeterville paid the Company $2,500,000 in exchange for an unsecured
promissory Note with an Original Issue Discount of $781,250. The Company will pay $3,301,250 consisting of the principal amount of the
Note, together with the original issue discount and $20,000 of lender transaction fees, no later than February 16, 2026. The stated interest
rate of the note is 10%. There was no debt at December 31, 2023. In 2024, the Company made three redemption payments in stock rather than
cash, helping to preserve AIM’s funds. AIM is in discussion to possibly pay future redemptions in stock. Equity
Purchase Agreement On
March 28, 2024, the Company entered into a purchase agreement and a registration rights agreement with Atlas Sciences, LLC (“Atlas”),
pursuant to which Atlas committed to purchase up to $ 15,000,000
of common stock of the Company for a period of
24 months from the date of the purchase agreement. No assurance can be given as to the actual amount that will be raised pursuant to
the purchase agreement. Under
the terms of the purchase agreement, the Company, at its sole discretion, shall have the right to issue Put shares to the Investor at
95 %
of the Market Price of the shares on the day of trade. Sales under the purchase agreement are limited to a daily maximum of the lessor
of: $ 500,000 ,
the Median Daily Trading volume, and a beneficial ownership limitation of 4.99 %
and a maximum of 19.99 %
of the outstanding shares at the time of the purchase agreement. In April 2024, the Company filed a registration statement with the SEC
on Form S-1 registering a total of 9,975,000
shares for resale pursuant to the Atlas Agreements,
consisting of 9,636,400
shares that can be sold by the Company to Atlas
and 338,600
shares that were issued to Atlas as Commitment
Shares. The registration statement was declared effective on May 1, 2024. There were no shares issued for the three months ended September
30, 2024. As of September 30, 2024, a total of 759,685
shares have been issued pursuant to the purchase
agreement for a total of approximately $ 128,000 . Securities
Purchase Agreement On
May 31, 2024, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) to complete an offering
(the “Transactions”) with a single accredited investor (the “Purchaser”), pursuant to which, on June 3, 2024,
the Company issued to the Purchaser, (i) in a registered direct offering, 5,640,958
shares of the Company’s common stock (the
“Shares”), par value $ 0.001
per share (“common stock”) and (ii)
in a concurrent private placement, the Company issued to the Purchaser Class A common warrants to purchase an aggregate of up to 5,640,958
shares of its common stock (the “A Warrants”)
at an exercise price of $ 0.363
per share and Class B common warrants to purchase
an aggregate of up to 5,640,958
shares of its common stock (the “B “Warrants”
and, along with the A Warrants, the “Common Warrants”) at an exercise price of $ 0.363
per share. The A Warrants and B Warrants are
not exercisable for six months after the issuance date and expire, respectively, 24 months and five years and six months after the issuance
date. The Common Warrants and the shares of common stock issuable upon the exercise of such warrants are offered pursuant to an exemption
from the registration requirements of the Securities Act provided in Section 4(a)(2) of the Securities Act and Rule 506(b) promulgated
thereunder. The
Shares were offered by the Company pursuant to a shelf registration statement on Form S-3 (File No. 333-262280), which was declared effective
on February 4, 2022 (as amended from time to time, the “Registration Statement”). Pursuant
to the terms of the Purchase Agreement, subject to certain exceptions, the Company could not issue any equity securities for 60 days
following the issuance date, provided that the Company was able to utilize its at-the-market offering program with the Placement Agent
after 30 days. Additionally, the Company cannot enter into a variable rate transaction (other than the ATM program with the Placement
Agent) for 120 days after the issuance date. In addition, the Company’s executive officers and each of the Company’s directors
have entered into lock-up agreements with the Company pursuant to which each of them has agreed not to, for a period of 90 days from
the closing of the Transactions, offer, sell, transfer or otherwise dispose of the Company’s securities, subject to certain exceptions. The
exercise price of the Common Warrants, and the number of Common Warrant Shares, are subject to adjustment in the event of any stock dividend
or split, reverse stock split, recapitalization, reorganization or similar transaction, as described in the Common Warrants. If a Fundamental
Transaction (as defined in the Common Warrants) occurs, then the successor entity will succeed to, and be substituted for the Company,
and may exercise every right and power that the Company may exercise and will assume all of its obligations under the Common Warrants
with the same effect as if such successor entity had been named in the warrant itself. Common Warrant Holders will have additional rights
defined in the Common Warrants. The Common Warrants are exercisable on a “cashless” basis only if there is not a current
registration statement permitting public resale. In this regard, the Company filed a registration statement to register the resale of
the Common Warrant Shares providing for the resale of the Shares issued and issuable upon exercise of the Common Warrants. That registration
statement was declared effective by the SEC on July 11, 2024. The Company has agreed to use commercially reasonable efforts to cause
such registration statement to keep such registration statement effective at all times until no Purchaser owns any Warrants or Warrant
Shares issuable upon exercise thereof. Maxim
Group LLC acted as the placement agent (the “Placement Agent”) on a “commercially reasonable best efforts” basis,
in connection with the Transactions pursuant to the Placement Agency Agreement, dated May 31, 2024 (the “Placement Agency Agreement”),
by and between the Company and the Placement Agent. Pursuant to the Placement Agency Agreement, the Placement Agent was paid a cash fee
of 8 %
of the aggregate gross proceeds paid to the Company for the securities sold in the Transactions and reimbursement of certain out-of-pocket
expenses. The
Company evaluated the Common Warrants under the guidance of ASC 480 – Distinguishing Liabilities from Equity and determined that
they were in scope under the guidance as freestanding financial instruments but did not meet the criteria for liability classification
and are classified as equity within the condensed consolidated financial statements. Proceeds allocated to such warrants totaled approximately
$ 2.5 million.
For the nine months ended September 30,2024, no Common Warrants were exercised, and all remain outstanding on September 30, 2024 related
to this agreement. On
September 30, 2024, the Company entered into a Securities Purchase Agreement to complete an offering with a single accredited investor.
For more information see Note 15: Subsequent Events. | (6)
Stockholders’ Equity (a)
Preferred Stock The
Company is authorized to issue 5,000,000
shares of $ 0.01
par value preferred stock with
such designations, rights and preferences as may be determined by the Board. Of our authorized preferred stock, 4,000,000
shares have been designated as
Series A Junior Participating Preferred Stock and 10,000
shares have been designated as
Series B Convertible Preferred Stock. Series
A Junior Participating Preferred Stock On
May 10, 2023, the Company filed a Certificate of Increase in Delaware, increasing the number of preferred stock designated as Series
A Junior Participating Preferred Stock to 4,000,000
from 250,000
shares. Series
B Convertible Preferred Stock The
Company has designated 10,000
shares of its preferred stock as
Series B Convertible Preferred Stock (the “Preferred Stock”). Each share of Preferred Stock has a par value of $ 0.01
per share and a stated value equal
to $ 1,000
(the “Stated Value”).
The shares of Preferred Stock shall initially be issued and maintained in the form of securities held in book-entry form and the Depository
Trust Company or its nominee (“DTC”) shall initially be the sole registered holder of the shares of Preferred Stock. Each
share of Preferred Stock shall be convertible, at any time and from time to time from and after the Original Issue Date at the option
of the Holder thereof or at any time and from time to time on or after the second anniversary of the Original Issue Date at the option
of the Corporation, into that number of shares of Common Stock (subject in each case to the limitations determined by dividing the Stated
Value of such share of Preferred Stock by the Conversion Price). The conversion price for the Preferred Stock shall be equal to $ 0.20 ,
subject to adjustment herein (the “Conversion Price”). Pursuant
to a registration statement relating to a rights offering declared effective by the SEC on February 14, 2019, AIM distributed to its
holders of common stock and to holders of certain options and redeemable warrants as of February 14, 2019, at no charge, one non-transferable
subscription right for each share of common stock held or deemed held on the record date. Each right entitled the holder to purchase
one unit, at a subscription price of $ 1,000
per unit, consisting of one share
of Series B Convertible Preferred Stock with a face value of $ 1,000
(and immediately convertible into
common stock at an assumed conversion price of $ 8.80 )
and 114
warrants with an assumed exercise
price of $ 8.80 .
The redeemable warrants are exercisable for five
years after the date of issuance.
The net proceeds realized from the rights offering were approximately $ 4,700,000 .
During the year ended December 31, 2023, 7
shares of Series B Convertible
Preferred Stock were converted into common stock. As
of December 31, 2023 and 2022, the Company had 689
and 696
shares of Series B Convertible
Preferred Stock outstanding, respectively. Holders shall be entitled to receive, and the Company shall pay, dividends on shares of Series
B Preferred Stock equal (on an as-if-converted-to-Common-Stock basis) to and in the same form as dividend actually paid on shares of
Common Stock when as and if such dividends are paid on shares of the Common Stock. Each such Preferred Share is convertible into 114
shares of common stock. Upon any
liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, the Holders shall be entitled to receive out
of the assets, whether capital or surplus of the Company the same amount that a holder of Common Stock would receive if the Preferred
Stock was fully converted. The Series B Convertible Preferred Stock does not carry voting Rights. (b)
Common Stock and Equity Finances The
Company has authorized shares of 350,000,000 with specific limitations and restrictions on
the usage of 8,000,000
of the 350,000,000
authorized shares. As
of December 31, 2023 and 2022, there were 49,102,484
and
48,084,287 shares
of Common Stock issued and outstanding, respectively. Employee
Stock Purchase Plan (Not equity compensation) On
July 7, 2020, the Board approved a plan pursuant to which all directors, officers, and employees could purchase from the Company up to
an aggregate of $ 500,000
worth of shares at the market price
(including subsequent plans, the “Employee Stock Purchase Plan”). Pursuant to NYSE American rules, this plan was effective
for a sixty-day period commencing upon the date that the NYSE American approved the Company’s Supplemental Listing Application.
The Company created successive new plans following the expiration of the July 7, 2020 plan. The latest plan was approved by the Board
in January 2024 and expires in March 2024. During
the year ended December 31, 2023, the Company issued a total of 419,285
shares of its Common Stock at a
price ranging from $ 0.31
to $ 0.67
for total proceeds of approximately
$ 150,500
as part of the employee stock purchase
plan. During
the year ended December 31, 2022, the Company issued a total of 86,817
shares of its Common Stock at prices
ranging from $ 0.76
to $ 1.02
for total proceeds of $ 80,000
as part of the employee stock purchase
plan. Warrants
(Rights offering) On
September 27, 2019, the Company closed a public offering underwritten by A.G.P./Alliance Global Partners, LLC (the “Offering”)
of (i) 1,740,550
shares
of Common Stock; (ii) pre-funded warrants exercisable for 7,148,310
shares
of Common Stock (the “Pre-funded Warrants”), and (iii) warrants to purchase up to an aggregate of 8,888,860
shares
of Common Stock (the “Warrants”). In conjunction with the Offering, we issued a
Representative’s Warrant to purchase up to an aggregate of 266,665
shares of common stock (the “Representative’s
Warrant”) . The shares of Common Stock and Warrants were sold at a combined Offering price
of $ 0.90 ,
less underwriting discounts and commissions. Each Warrant sold with the shares of Common Stock represents the right to purchase one share
of Common Stock at an exercise price of $ 0.99
per share.
The Pre-Funded Warrants and Warrants were sold at a combined Offering price of $ 0.899 ,
less underwriting discounts and commissions. The Pre-Funded Warrants were sold to purchasers whose purchase of shares of Common Stock
in the Offering would otherwise result in the purchaser, together with its affiliates and certain related parties, beneficially owning
more than 4.99 %
of the Company’s outstanding Common Stock immediately following the consummation of the Offering, in lieu of shares of Common Stock.
Each Pre-Funded Warrant represents the right to purchase one share of Common Stock at an exercise price of $ 0.001
per share.
The Pre-Funded Warrants are exercisable immediately and may be exercised at any time until the Pre-Funded Warrants are exercised in full.
A registration statement on Form S-1, relating to the Offering was filed with the SEC and was declared effective on September 25, 2019,
the net proceeds were approximately $ 7,200,000 .
During the year ended December 31 ,
2020, 1,870,000
of
the Pre-funded Warrants were exercised and 8,873,960
Warrants
were exercised. In addition, on March
25, 2020, the Representative’s Warrant was amended to permit exercise of such warrant to commence on March 30, 2020. These warrants
were exercised on March 31, 2020 and an aggregate of 266,665
shares were issued upon exercise
of this warrant for gross proceeds of approximately $ 264,000
and a $ 46,000
expense for the warrant modification.
No Warrants were exercised during the year ended December 31, 2023 and 2022. As of December 31, 2023 and 2022 there are 15,000
Warrants outstanding. Equity
Distribution Agreement On
April 19, 2023, the Company entered into an Equity Distribution Agreement (the “EDA”) with Maxim Group LLC
(“Maxim”), pursuant to which the Company may sell, from time to time, shares of its common stock having an aggregate
offering price of up to $ 8,500
000 through Maxim, as agent
(the “Offering”). Sales under the EDA were registered under the S-3 Shelf Registration Statement. Under the terms of the
EDA, Maxim will be entitled to a transaction fee at a fixed rate of 3.0 %
of the gross sales price of shares sold under the EDA. During the year ended December 31, 2023, the Company sold 598,114 shares
under the EDA for total gross proceeds of approximately $ 344,000 ,
which includes a 3.0 %
fee to Maxim of $ 10,326 .
Subsequent to the year ended December 31, 2023, the Company sold 699,568 shares
under the EDA for total gross proceeds of $ 316,392 ,
which includes a 3.0 %
fee to Maxim of $ 9,492 . Rights
Plan On
May 12, 2023, the Company amended and restated its November 14, 2017 Rights Plan with American Stock Transfer & Trust Company as
Rights Agent (the “Rights Plan”). (c)
Common Stock Options and Warrants (i)
Stock Options The
2018 Equity Incentive Plan, effective September 12, 2018, authorizes the grant of (i) Incentive Stock Options, (ii) Nonstatutory Stock
Options, (iii) Stock Appreciation Rights, (iv) Restricted Stock Awards, (v) Restricted Stock Unit Awards, (vi) Performance Stock Awards,
(vii) Performance Cash Awards, and (viii) Other Stock Awards. Initially, a maximum of 7,000,000
shares of common stock is reserved
for potential issuance pursuant to awards under the 2018 Equity Incentive Plan. Unless sooner terminated, the 2018 Equity Incentive Plan
will continue in effect for a period of 10
years from its effective date. The
Equity Incentive Plan of 2018 is provides Stock
options awarded under the Plan may be exercisable at such times (not later than 10 years after the date of grant) and at such exercise
prices (not less than fair market value at the date of grant) as the Board may determine. The Board may provide for options to become
immediately exercisable upon a “change in control”, which is defined in the Plan to occur upon any of the following events:
(a) the acquisition by any person or group, as beneficial owner, of 20% or more of the outstanding shares or the voting power of the
outstanding securities of the Company; (b) either a majority of the Directors of the Company at the annual stockholders meeting has been
nominated other than by or at the direction of the incumbent Directors of the Board, or the incumbent Directors cease to constitute a
majority of the Company’s Board; (c) the Company’s stockholders approve a merger or other business combination pursuant to
which the outstanding common stock of the Company no longer represents more than 50% of the combined entity after the transaction; (d)
the Company’s stockholders approve a plan of complete liquidation or an agreement for the sale or disposition of all or substantially
all of the Company’s assets; or (e) any other event or circumstance determined by the Company’s Board to affect control of
the Company and designated by resolution of the Board as a change in control. The
fair value of each option award is estimated on the date of grant using a Black-Scholes-Merton pricing option valuation model. Expected
volatility is based on the historical volatility of the price of the Company’s stock. The risk-free interest rate is based on U.S.
Treasury issues with a term equal to the expected life of the option and equity warrant. The Company uses historical data to estimate
expected dividend yield, life and forfeiture rates. The expected life of the options and equity warrants was estimated based on historical
option and equity warrant holders’ behavior and represents the period of time that options and equity warrants are expected to
be outstanding. The fair values of the options granted were estimated based on the following weighted average assumptions: Schedule
of Options and Equity Estimated Based on Weighted Average Assumptions
Year
Ended December 31,
2023 2022
Risk-free interest
rate 4.37 % 1.74 %
- 3.88 %
Expected dividend yield — —
Expected life 10
years 10
years
Expected volatility 99.91 % 98.43 %
- 107.18 %
Weighted average grant date fair
value for options issued $0.43
per option for 400,000 options $0.51
per option for 850,000 options The
exercise price of all stock options and equity warrants granted was equal to or greater than the fair market value of the underlying
common stock on the date of the grant. Information
regarding the options approved by the Board of Directors under the Equity Plan of 2009 is summarized below. The plan expired on June
24, 2019: Schedule
of Stock Option Activity
2023 2022
Option Weighted Option Weighted
Shares Price Price Shares Price Price
Outstanding, beginning
of year 124,399 13.20
–
1,003.20 22.23 128,504 13.20
–
2,127.84 25.58
Granted — — — — — —
Forfeited (5,047 ) 9.68 - 327.36 57.79 (4,105 ) 16.76 - 2,127.84 129.88
Exercised — — — — — —
Outstanding,
end of year 119,352 13.20 - 2,127.84 20.72 124,399 13.20 - 1,003.20 22.23
Exercisable, end of year 119,352 13.20 - 2,127.84 124,399 13.20 - 1,003.20
Weighted
average remaining contractual life (years) 4.06
years 5.98
years Information
regarding the options approved by the Board of Directors under the Equity Plan of 2018 is summarized below: Schedule
of Stock Option Activity
2023 2022
Option Weighted Option Weighted
Shares Price Price Shares Price Price
Outstanding, beginning
of year 2,474,971 0.31 - 9.68 1.72 1,650,017 1.11
–
9.68 2.35
Granted 400,000 0.47 - 0.47 0.47 850,000 0.31
–
1.71 0.51
Forfeited (60,829 ) 0.31 - 9.68 1.98 (25,046 ) 1.85
–
9.68 1.86
Exercised — — — — — —
Outstanding,
end of year 2,814,142 0.31 - 9.68 1.54 2,474,971 0.31
–
9.68 1.72
Exercisable, end of year 2,397,474 0.31 - 327.36 4.71 1,916,637 0.41
–
9.68 2.22
Weighted average remaining contractual
life (years) 7.96
years 9.65
years
Available
for future grants 1,210,286 466,120 Stock
option activity during the years ended December 31, 2023 and 2022 is as follows: Vested
stock option activity for employees: Schedule
of Vest Stock Option Activity
Number of Weighted Average
Exercise Weighted Aggregate Intrinsic
Options Price (Years) Value
Outstanding December 31, 2021 1,498,798 $ 4.22 9.11 —
Granted 550,000 0.49 9.71 —
Forfeited (28,584 ) 17.71 — —
Expired — — — —
Outstanding December 31, 2022 2,020,214 $ 3.01 8.86 —
Granted 400,000 0.47 10.17 —
Forfeited (7,601 ) 9.68 —
Expired (4,175 ) 41.61 — —
Outstanding December 31,
2023 2,408,438 $ 2.50 8.70 —
Vested
and expected to vest at December 31, 2023 2,041,772 $ 1.90 6.73 —
Exercisable at December
31, 2023 2,041,772 $ 1.90 6.73 — The
weighted-average grant-date fair value of employee options vested during the year ended December 31, 2023 was $ 184,000
for 424,999
options at $ 0.43
per option and during year ended
December 31, 2022 was $ 768,666
for 575,000
options at $ 1.34
per option. Unvested
stock option activity for employees: Schedule
of Unvested Stock Option Activity
Number of Weighted Average Exercise Average Remaining Contracted
Term Aggregate Intrinsic
Options Price (Years) Value
Unvested December
31, 2021 412,500 $ 4.15 5.85 —
Granted 550,000 0.49 9.71 —
Vested (541,590 ) 1.31 9.73 —
Forfeited (28,584 ) 17.71 — —
Unvested December 31, 2022 392,326 $ 0.80 8.86 —
Granted 400,000 0.47 10.17 —
Vested (413,884 ) 1.90 6.73 —
Forfeited (7,601 ) 9.68 — —
Expired (4,175 ) 41.61 — —
Unvested
December 31, 2023 366,666 $ 2.13 12.44 — Vested
stock option activity for non-employees: Schedule
of Vest Stock Option Activity
Number of Weighted Average
Exercise Weighted Average
Remaining Contracted Term Aggregate Intrinsic
Options Price (Years) Value
Outstanding December 31, 2021 279,723 $ 6.12 7.93 —
Granted 300,000 0.54 9.68 —
Exercised — — — —
Forfeited (568 ) 153.12 — —
Outstanding December 31, 2022 579,155 $ 3.09 8.36 —
Granted 360,000 0.46 10.04 —
Exercised — — — —
Expired (653 ) 145.24 — —
Forfeited (53,447 ) 1.31 — —
Outstanding December 31,
2023 885,055 $ 2.02 9.23 —
Vested
and expected to vest at December 31, 2023 550,055 $ 2.56 10.02 —
Exercisable at December
31, 2023 550,055 $ 2.56 10.02 — The
weighted-average grant-date fair value of non-employee options vested during year 2023 was $ 90,000
for 191,666
options at $ 0.47
per option and during the year
2022 was $ 247,166
for 229,053
options at $ 1.08
per option. Unvested
stock option activity for non-employees: Schedule
of Unvested Stock Option Activity
Number of Weighted Average
Exercise Weighted Aggregate Intrinsic
Options Price (Years) Value
Unvested
December 31, 2021 97,831 $ 3.89 7.82 —
Granted 300,000 0.54 9.68 —
Vested (229,053 ) 0.82 — —
Forfeited (1,989 ) — — —
Unvested
December 31, 2022 166,789 $ 4.05 9.49 —
Granted 360,000 0.46 10.18 —
Vested (137,565 ) 0.47 9.47 —
Expired (776 ) 145.24 — —
Forfeited (53,447 ) 1.31 — —
Unvested
December 31, 2023 335,001 $ 1.83 10.70 — Stock-based
compensation expense was approximately $ 243,000
and $ 954,000
for the years ended December 31,
2023 and 2022. As
of December 31, 2023 and 2022, there was $ 294,000
and $ 217,000 ,
respectively, of unrecognized stock-based compensation cost related to options granted under the Equity Incentive Plans. Stock-based
compensation related to options granted under the Equity Incentive Plans will be recorded over the vesting period which is typically
one year or upon reaching agreed upon Company and/or individual performance milestones being met which is indefinite. (ii)
Stock Warrants Stock
warrants are issued as needed by the Board of Directors and have no formal plan. The
fair value of each warrant award is estimated on the date of grant using a Black-Scholes-Merton pricing option valuation model. Expected
volatility is based on the historical volatility of the price of the Company’s stock. The risk-free interest rate is based on U.S.
Treasury issues with a term equal to the expected life of the warrant. The Company uses historical data to estimate expected dividend
yield, life and forfeiture rates. The expected life of the warrants was estimated based on historical option holder’s behavior
and represents the period of time that options are expected to be outstanding. No warrants were granted in 2023 or 2022. Information
regarding warrants outstanding and exercisable into shares of common stock is summarized below: Schedule
of Warrants Outstanding and Exercisable
2023 2022
Warrant Weighted Warrant Weighted
Shares Price Price Shares Price Price
Outstanding, beginning
of year 226,610 $
0.99 - 132.00 $ 9.10 294,939 $ 0.99
–
469.92 $ 15.19
Granted — — — — — —
Expired (74,450 ) 17.05 17.05 (68,215 ) 469.92 469.92
Exercised — — — (114 ) 8.80 8.80
Outstanding,
end of year 152,160 $
0.99 - 8.80 $ 8.03 226,610 $
0.99 - 132.00 $ 9.10
Exercisable 152,160 $
0.99 - 8.80 $ 8.03 226,610 $
0.99 - 132.00 $ 9.10
Weighted average remaining contractual life .75
years .94
years
Years exercisable 2024 2023 - 2024 Stock
warrants are issued at the discretion of the Board. During the year ended December 31, 2023, there were no
warrants issued or exercised. During
the year ended December 31, 2022, there were no
warrants issued and 114
were exercised. |
