NOTE 5 - STOCKHOLDERS’ EQUITY (DEFICIT)

Equity Sales

During the three months ended June 30, 2025, the Company sold common stock in two private unregistered transactions to investors resulting in total proceeds of $150,000 and the issuance of 10,632 shares of common stock.  One of these transactions was to a related party for proceeds of $50,000 and the issuance of 3,488 shares of common stock.  During the three months ended June 30, 2024, the Company sold common stock in nine private unregistered transactions to related parties resulting in total proceeds of $659,999 and the issuance of 83,887 shares of common stock. 

During the six months ended June 30, 2025, the Company sold common stock in 2 private unregistered transactions to investors resulting in total proceeds of $150,000 and the issuance of 10,632 shares of common stock.  One of these transactions was to a related party for proceeds of $50,000 and the issuance of 3,488 shares of common stock.  During the six months ended June 30, 2024, the Company sold common stock in 29 private unregistered transactions to investors resulting in total proceeds of $1,763,325 and the issuance of 491,186 shares of common stock.  Included in the totals are 140,553 shares of common stock sold to related parties for proceeds of $790,781.

Warrants

In the three months and six months ended June 30, 2025 the Company issued warrants to acquire 1,062 shares of the Company’s common stock.  These warrants were tied to direct placements of common stock under a board approved private fund raising program.  Of the total, warrants for 348 shares were issued to a Related Party. 

In the three months and six months ended June 30, 2024 the Company issued 698 warrants to a Related Party investor under a board approved private fund raising program.

Equity Compensation

For the three months ended June 30, 2025, the Company made no new equity awards for either Board Members or employees.  For the three months ended June 30, 2025, the Company expensed $336,743 for equity compensation to members of the Board of Directors and certain employees related to awards made to certain employees and the non-employee directors in the prior periods.  $19,424 of the total expense for the quarter was related to research and development (R&D) and the remaining $317,319 was for general and administrative expenses (G&A).

For the three months ended June 30, 2024, the Company recognized expense of $7,549,655 for equity compensation to members of the Board of Directors and certain employees for restricted stock awards and option grants.  The total expense amount was related to new equity grants in the period plus equity awards from prior periods.  $2,025,580 of the total expense for the quarter was related to R&D and the remaining $5,524,075 was for G&A.

For the six months ended June 30, 2025, the Company expensed $937,288 for equity compensation to members of the Board of Directors and certain employees. The total expense included amounts related to awards made to certain employees and the non-employee directors in the prior periods, and amounts related to new awards made to the non-employee directors in the period.  $59,992 of the total expense for the quarter was related to R&D and the remaining $877,296 was for G&A.

For the six months ended June 30, 2024, the Company expensed $7,661,759 for equity compensation to members of the Board of Directors and certain employees for restricted stock awards and option grants.  The total expense amount was related to new equity grants in the period plus equity awards from prior periods.  $2,060,228 of the total expense for the quarter was related to R&D and the remaining $5,601,531 was for G&A.

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 vested on March 11, 2025, and 1,346 shares will vest on the day prior to the 2025 annual stockholder meeting.

Common Stock Restricted Stock Awards (RSA)

The total RSA expense recorded in the three and six months ended June 30, 2025 and 2024 are as follows:

The 2025 and 2024 RSA activity is as follows:

As of June 30, 2025, there was no remaining unrecognized compensation expense related to RSAs. As of June 30, 2024, there was $1,055,454 of unrecognized compensation expense related to RSAs.

The total fair value of RSAs vested during the six months ended June 30, 2025 was $3,483,379, and during the six months ended June 30, 2024 was $2,355,054. The fair value was determined based on the number of shares vesting and the closing price of shares of our common stock on the dates the awards vested.

Common Stock Warrants - Unregistered

A summary of the status of the Company’s unregistered warrants is presented below:

Unregistered warrants outstanding and exercisable by price range as of June 30, 2025, were as follows:

Common Stock Warrants - Registered

A summary of the status of the Company’s registered warrants is presented below:

Registered warrants outstanding and exercisable by price range as of June 30, 2025, were as follows: