Item 2. Unregistered Sales of Equity Securities
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Recent Sales of Unregistered Securities
During the nine months ended September 30, 2022, the Company converted an aggregate of $1,432,979 in outstanding principal of convertible notes into 24,827 shares of common stock.
On April 8, 2022, the Company and various purchasers (the “Investors”) executed a Securities Purchase Agreement (the “SPA”) whereby the Investors purchased from the Company promissory notes (the “Notes”) in the aggregate principal amount of $3,068,750.
In connection with the issuance of the Notes further to the SPA, the Company issued warrants to acquire 12,577 shares of its common stock at an exercise price of $1.22 per share expiring in April 2027.
On July 22 and July 28, 2022, the Company and various purchasers executed a Securities Purchase Agreement whereby the investors purchased from the Company convertible promissory notes in the aggregate principal amount of $1,875,000, consisting of original issue discount of $375,000. The Company received net proceeds of $1,450,000 after the original issue discount and fees. The July notes mature on October 31, 2022.
In connection with the July 22 and July 28 notes, the Company issued an aggregate of 41,124 and 27,655 warrants to purchase common stock at an exercise price of $15.20 and $11.30 per share, respectively.
From October 1, 2022 through the issuance date, the Company has converted approximately $5.5 million of the Oasis and FirstFire notes into 543,845 shares of common stock.
Use of Proceeds from Public Offering of Common Stock
The net proceeds the Company received from the sale of 373,898 shares of its common stock in the offering, after deducting underwriter discounts and commissions, the non-accountable expense, the underwriters’ expense reimbursement and estimated offering expenses, was $8,051,285 based on a public offering price of $2.50 per share.
None of the underwriting discounts and commissions or offering expenses were paid directly or indirectly to any directors or officers of ours or their associates or to persons owning 10% or more of any class of equity securities or to any affiliates of ours.
We used the net proceeds to us from the IPO for general corporate purposes, including working capital, marketing initiatives and capital expenditures. Specifically, we used a portion of the net proceeds from the offering to repay the April 2022 Notes.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURE
Not applicable.
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