Note 9 - Warrants

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Warrants [Text Block]

9. WARRANTS

All common stock share and per share data reflects the reverse stock split effective April 21, 2023, as described in Note 19 Subsequent Events, Reverse stock split.

On April 28, 2022, the Company entered into a Securities Purchase Agreement with an institutional investor. The Purchase Agreement provides for the sale and issuance by the Company of an aggregate of: (i) 225,000 shares of the Company’s common stock, $0.001 par value, (ii) pre-funded warrants to purchase up to 178,847 shares of Common Stock and (iii) accompanying warrants to purchase up to 403,846 shares of Common Stock. The offering price per share and associated prefunded warrants was $52.00 for the shares and $51.996 for the prefunded warrants. The prefunded warrants were immediately exercisable, had an exercise price of .004 and were exercised during the three months ended June 30, 2022.

The accompanying warrants have an exercise price of $52.40, and will be exercisable 6-months after their date of issuance and will expire on the fifth anniversary of the original issuance date.

Common stock warrants are accounted for in accordance with applicable accounting guidance provided in ASC Topic 815, Derivatives and Hedging - Contracts in Entity's Own Equity (ASC Topic 815), as either derivative liabilities or equity instruments depending on the specific terms of the warrant agreement.

The Company’s warrants are considered to be derivative warrants, are classified as liabilities, and are recorded at fair value. The warrants are subject to re-measurement at each balance sheet date and any change in fair value is recognized as a component of change in fair value of warrant liability in the consolidated statements of operations. The Company uses the Black-Scholes pricing model to estimate the fair value of the related derivative warrant liability. The warrants are classified as Level 3 liabilities (see Note 12 for fair value disclosures.)

Warrants outstanding and warrant activity for the three months ended March 31, 2023 is as follows:

Description	Classification	Exercise Price		Expiration Date	Balance December 31, 2022		Warrants Issued		Warrants Exercised		Warrants Expired		Balance March 31, 2023
Warrants	Liability	$	52.40	April 2027		403,846		-		-		-		403,846
Total						403,846		-		-		-		403,846