NOTE 14 - SUBSEQUENT EVENTS

2021 Plan Evergreen Provision

On January 1, 2025, 181,066 shares were added to the 2021 Plan as a result of the evergreen provision.

Equity Incentive Plan for Non-Employee Directors Evergreen Provision

On January 1, 2025, 181,066 shares were added to the Equity Incentive Plan for Non-Employee Directors as a result of the evergreen provision.

Short Term Loan

On February 21, 2025, the Company entered into a short-term unsecured loan agreement to finance a portion of the Company's directors' and officers', and employment practices liability insurance premiums. The note in the amount of $488,198 carries a 7.85% annual percentage rate and will be paid down in ten equal monthly payments of $50,593 beginning on March 10, 2025.

Directors Stock Awards

On January 1, 2025 the Compensation Committee of the Board of Directors awarded 38,378 RSA shares to the four non-employee members of the Boards in three separate actions. 

From January 1, 2024 through June 10, 2024 the Company accrued payments to the non-employee board members pursuant to the Non-Employee Directors Compensation Policy in place at the time.  The total amount accrued for that time period was $69,827.  The Compensation Committee agreed the non-employee members of the board would forgo the accrued cash payment in lieu of RSA shares.  The Compensation Committee determined the fair exchange price would be $16.74 per share resulting in the Company issuing an aggregate of 4,170 shares in exchange for the $69,827 of accrued cash.  The restricted shares have been issued to the non-employee board members and will vest in full on March 31, 2025.

Additionally, from June 11, 2024 through December 31, 2024 the Company accrued payments to the non-employee board members in total of $124,934 for board service. The Compensation Committee agreed the non-employee members of the board would forgo the accrued cash payment in lieu of RSA shares.  The Compensation Committee also considered the Company’s cash position going forward and awarded the non-employee board members RSA shares for the remainder of the members’ service through the Company’s next annual meeting of shareholders in lieu of cash payments.  This future amount would have been $104,819.  The Compensation Committee determined the fair exchange price would be $7.97 per share resulting in the Company issuing an aggregate of 28,826 shares in exchange for the $229,753 of accrued and future cash payments. The restricted shares have been issued to the non-employee board members and will vest in full on June 10, 2025.

The Compensation Committee awarded Laith Yaldoo 5,382 RSA shares for his pro-rata share of the annual RSA award based on his appointment to the Board of Directors on July 12, 2024.  The restricted shares have been issued to Mr. Yaldoo, 2,691 shares vested immediately on the date of the award, 1,345 shares will vest on March 11, 2025, and 1,346 shares will vest on the day prior to the 2025 annual stockholder meeting.

Deferred R&D Obligations – Participant Agreements

From January 9, 2025, through March 10, 2025, the Company has entered into a series of Exchange Agreements (“Exchange Agreements”) with Participants to the Participation Agreements described in "Note 8 - Deferred R&D Obligations - Participation Agreements". Under the Participation Agreements, the Company had a buy-out option pursuant to which it could purchase the Investors’ right, title and interest in the revenue share for an aggregate minimum purchase price of $5,306,500. The Exchange Agreements would provide for the cancellation of the Purchase Agreements and accompanying forfeiture of each Investor’s right to earn certain cash from the revenue share and buy-out option in exchange for the Company’s common stock. To date, the Company has completed an exchange with fourteen of the Participants for a total of 124,180 shares of Common Stock of the Company in exchange for $3,104,500 of the aggregate minimum purchase price.