|9 Months Ended|
Sep. 30, 2023
|Stockholders' Equity Note [Abstract]|
|Stockholders' Equity||Stockholders’ Equity
Common Stock: Our Articles of Incorporation authorize 200,000,000 shares of common stock that may be issued from time to time having such rights, powers, preferences, and designations as the Board of Directors may determine. During the 13 weeks ended September 30, 2023 and October 1, 2022, no shares of common stock were issued in lieu of professional services.
On March 22, 2023, the Company entered into a Securities Purchase Agreement with certain institutional investors for the sale by the Company in a registered direct offering of 361,000 shares of the Company’s common stock, par value $0.001 per share, at a purchase price per share of Common Stock of $1.17. The offering closed on March 24, 2023. The aggregate gross proceeds for the sale of the shares of Common Stock were approximately $422,000, before deducting the placement agent fees and related expenses. The Company intends to use the net proceeds for working capital and general corporate purposes.
On August 18, 2023, the Company entered into a Securities Purchase Agreement with a certain institutional investor for the sale by the Company in a registered direct offering of: (i) 418,000 shares of the Company’s common stock, par value $0.001 per share, at an offering price of $0.8811 per share and (ii) pre-funded warrants exercisable for up to 481,348 shares of Common Stock to the Investor at an offering price equal to $0.8801 per pre-funded Warrant. The aggregate gross proceeds from the offering were approximately $790,000, before deducting the placement agent fees and related expenses. The Company intends to use the net proceeds for working capital and general corporate purposes. On August 31, 2023, 481,348 of the pre-funded warrants were exercised. In a concurrent private placement, the Company also granted warrants to purchase up to 899,348 shares of Common Stock. Each warrant is exercisable immediately following issuance at an exercise price of $0.7561 per share and expires August 31, 2028. As of September 30, 2023, there were 899,348 of the private placement warrants outstanding.
As of September 30, 2023, and December 31, 2022, there were 4,957,647 and 2,827,410 shares, respectively, of common stock issued and outstanding.
Stock Options: The 2016 Plan, which replaces the 2011 Plan, authorizes the granting of awards in any of the following forms: (i) incentive stock options, (ii) nonqualified stock options, (iii) restricted stock awards, and (iv) restricted stock units, and expires on the earlier of October 28, 2026, or the date that all shares reserved under the 2016 Plan are issued or no longer available. The 2016 Plan provides for the issuance of up to 800,000 shares of common stock pursuant to awards granted under the 2016 Plan. The vesting period is determined by the Board of Directors at the time of the stock option grant. As of September 30, 2023, and December 31, 2022, 100,000 and 90,000 options were outstanding under the 2016 Plan, respectively.
The Company’s 2011 Plan, which has expired, authorizes the granting of awards in any of the following forms: (i) stock options, (ii) stock appreciation rights, and (iii) other share-based awards, including but not limited to, restricted stock, restricted stock units or performance shares. As of September 30, 2023, and December 31, 2022, 14,000 and 20,000 were outstanding under the 2011 Plan, respectively. No additional awards will be granted under the 2011 Plan.
The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. There were 10,000 options granted during the 39 weeks ended September 30, 2023.
Additional information relating to all outstanding options is as follows:
The Company recognized approximately $1,000 and $4,000 of share-based compensation expense for the 13 weeks ended September 30, 2023 and October 1, 2022, respectively, and approximately $14,000 and $4,000 of share-based compensation expense for the 39 weeks ended September 30, 2023 and October 1, 2022, respectively.
As of September 30, 2023, the Company has no unrecognized share-based compensation expense associated with stock option awards.
Series A-1 Preferred Stock
Shares of Series A-1 Preferred Stock are convertible into the Company’s common shares at a ratio of 1:20. 27,353 shares were converted during the 39 weeks ended September 30, 2023, and 1,505 shares were forfeited. As of September 30, 2023 and December 31, 2022, there were 193,730 and 222,588 shares of Series A-1 Preferred Stock outstanding, respectively.
The entire disclosure for shareholders' equity and share-based payment arrangement. Includes, but is not limited to, disclosure of policy and terms of share-based payment arrangement, deferred compensation arrangement, and employee stock purchase plan (ESPP).
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef