NOTE 9 – WARRANTS

AlloMek Warrants

During the year ended December 31, 2022, the Company issued warrants to purchase an aggregate of 50,000 shares of Common Stock (the “AlloMek Warrants”) to certain sellers in connection with the acquisition of AlloMek. The AlloMek Warrants were issued on October 11, 2022, were immediately exercisable at $37.60 per share and expire five years from the date of issuance. The total grant date fair value of the AlloMek Warrants was determined to be approximately $0.5 million, as calculated using the Black-Scholes model and were capitalized and included in intangible assets. The assumptions used in the Black-Scholes calculation were as follows: volatility 55.7%; duration five years; and a risk-free rate of 4.14%.

As of December 31, 2023 and 2022, 50,000 AlloMek Warrants were outstanding.

Alpha-5 Warrants

During the year ended December 31, 2022, the Company issued warrants to purchase an aggregate of 50,000 shares of Common Stock (the “Alpha-5 Warrants”) to certain sellers in connection with the acquisition of Alpha-5. The Alpha-5 Warrants were issued on June, 21, 2022, were immediately exercisable at $37.60 per share and expire five years from the date of issuance. The total grant date fair value of the Alpha-5 Warrants was determined to be approximately $0.4 million, as calculated using the Black-Scholes model and were recorded as an increase to additional paid-in capital. This amount was included as part of the consideration paid for the Alpha-5 acquisition and were included as part of the purchase price allocation accordingly. The assumptions used in the Black-Scholes calculation were as follows: volatility 55.7%; duration five years; and a risk-free rate of 3.38%.

As of December 31, 2023 and 2022, 50,000 Alpha-5 Warrants were outstanding.

PIPE Warrants

During the year ended December 31, 2021, the Company issued PIPE Warrants to purchase an aggregate of 434,000 shares of Common Stock to certain investors in connection with the November 2021 Private Placement. The PIPE Warrants were issued on November 24, 2021, are immediately exercisable at $70.00 per share and expire five years from the date of issuance.

As of December 31, 2023 and 2022, 434,000 PIPE Warrants were outstanding.

IPO Warrants

During the year ended December 31, 2021, the Company issued Public Warrants to purchase an aggregate of 276,000 shares of Common Stock in its Initial Public Offering. Simultaneously with the consummation of the closing of the Initial Public Offering, the Company issued the underwriters a total of 13,800 Representative Warrants that became exercisable commencing six (6) months following issuance at an exercise price of $120.00 per share and expire five years from issuance.  

The Company evaluated the IPO Warrants based on an assessment of the IPO Warrants’ specific terms and applicable authoritative guidance in ASC 480, “Distinguishing Liabilities from Equity” (“ASC 480”) and ASC 815, “Derivatives and Hedging” (“ASC 815”). The IPO warrants are classified as liabilities and remeasured at each reporting period.

As of December 31, 2023 and 2022, 220,000 Public Warrants and 13,800 Representative Warrants were outstanding.  

As of December 31, 2023, the fair value of the Public Warrants was approximately $0.36 per Public Warrant based on the closing price of the Public Warrants on The Nasdaq Capital Market. The fair value of the Representative Warrants was approximately $0.374 per Representative Warrant which was based on the relative fair value to the Public Warrants.

Warrant activity for the years ended December 31, 2023 and 2022 was as follows:

Warrants exercisable at December 31, 2023 were as follows:

No warrants were granted, expired/cancelled, or exercised during the year ended December 31, 2023.