v3.26.1
Note 6 - Subsequent Events
3 Months Ended
Jun. 30, 2026
Notes to Financial Statements  
Subsequent Events [Text Block]

Note 6 – Subsequent Events

 

On July 13, 2026, the Company entered into a warrant inducement offer letter (the “July 2026 Inducement Letter”) with the Investor of certain existing Common Warrants issued on November 19, 2025, to purchase up to 428,731 shares of Company common stock.

 

Pursuant to the July 2026 Inducement Letter, the Company reduced the exercise price of the Common Warrants to $6.00 per warrant share, and the Investor exercised Common Warrants to purchase 428,731 shares of Company common stock. In consideration of the foregoing, the Company issued the Investor (i) a new Series D-1 unregistered common stock purchase warrant to purchase up to 428,731 shares of Company common stock (the “New Series D-1 Warrant”) and (ii) a new Series D-2 unregistered common stock purchase warrant to purchase up to 428,731 shares of Company common stock (the “New Series D-2 Warrant” and, together with the New Series D-1 Warrant, the “New Series D Warrants,” and the shares of Company common stock underlying the New Series D Warrants, the “New Series D Warrant Shares”), in each case pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), with an exercise term of 5.5 years from issuance.

 

The Company received aggregate gross proceeds of approximately $2.6 million from the exercise of the Common Warrants, before deducting financial advisory fees and estimated offering expenses.

 

The New Series D Warrants are immediately exercisable and have an exercise price of $5.75 per share. The exercise price and number of shares of common stock issuable upon exercise is subject to appropriate proportional adjustment in the event of share dividends, share splits, reorganizations or similar events affecting the Company’s common stock and the exercise price. The New Series D Warrants may only be exercised on a cashless basis if, commencing six months after issuance, there is no effective registration statement registering, or the prospectus contained therein is not available for, the resale of the shares of common stock underlying the New Series D Warrants by the Investor. The Investor of a New Series D Warrant may not exercise any such warrant to the extent that such exercise would result in the number of shares of common stock beneficially owned by such Investor and its affiliates exceeding 4.99% or 9.99% (at the election of the Investor) of the total number of shares of common stock outstanding immediately after giving effect to the exercise, which percentage may be increased or decreased at the Investor's election not to exceed 9.99% (the “Beneficial Ownership Limitation”). In the event of certain fundamental transactions, the Investor of a New Series D-1 Warrant will have the right to receive the Black Scholes value of such New Series D-1 Warrant calculated pursuant to a formula set forth therein, payable in cash if the fundamental transaction is within the Company’s control or, if the fundamental transaction is not within the Company’s control, in the same type or form of consideration being offered and paid to the holders of common stock. In the event of a fundamental transaction, the holder of a New Series D-2 Warrant will have the right to receive the same type or form of consideration being offered and paid to the holders of common stock but shall not have a Black Scholes redemption right.

 

The Company filed a registration statement providing for the resale of the New Series D Warrant Shares issuable upon the exercise of the New Series D Warrants and has agreed to keep the resale registration statement effective at all times until no holder of the New Series D Warrants owns any New Series D Warrants or New Series D Warrant Shares. Maxim Group LLC (“Maxim”) served as warrant solicitation agent in connection with the solicitation of the exercise of the Existing Series D Warrants, and the Company paid Maxim a cash fee equal to 7.0% of the total proceeds received by the Company from the exercise of the Existing Series D Warrants and to reimburse Maxim for its reasonable expenses in an amount not to exceed $15,000.