Quarterly report pursuant to Section 13 or 15(d)


9 Months Ended
Sep. 30, 2022
Subsequent Events [Abstract]  



The Company has evaluated subsequent events through November 14, 2022, the date these condensed consolidated financial statements were issued. There were no material events or transactions that require disclosure in the financial statements other than the items discussed below.


Equity Financing


Subsequent to September 30, 2022, the Company issued 867,741 shares and received $302 of net proceeds associated with at-the-market (“ATM”) issuances.


On October 25, 2022, the Company entered into the October Purchase Agreement, which provides for the sale and issuance by the Company of an aggregate of (i) 12,500,000 shares of Common Stock, at a purchase price of $0.32 per share, and (ii) warrants to purchase 12,500,000 shares of the common stock at an exercise price of $0.34 per share, for aggregate gross proceeds of $4,000 before deducting placement agent commissions and other offering expenses. As a result of this transaction, certain warrants which previously had an exercise price of $0.75 per share had the exercise price reduced to $0.34 per share.


In addition, the Company paid $1,172 towards principal and accrued interest on the Notes. The Company and the January Note Holders also agreed to interest only payments with a final principal payment of $2,545 due on the maturity date.


Debt Financing


Subsequent to September 30, 2022, the Company received secured advances from an unaffiliated third party totaling $225 for the purchase of future receipts/revenues of $322. In connection with the secured advance, the Company paid $11 of debt issuance costs which will be amortized over the term using the effective interest rate method.


On November 7, 2022, the Company entered into the November Note Purchase Agreement with the November Note Holder providing for the sale and issuance of an unsecured, non-convertible promissory note in the original principal amount of $5,470, which has an original issue discount of $470, resulting in gross proceeds to the Company of approximately $5,000. The November Note matures eighteen months following the date of issuance. Commencing six months from the date of issuance, the Company is required to make monthly cash redemption payments in an amount not to exceed $600. The November Note may be repaid in whole or in part prior to the maturity date for a 10% premium. The November Note requires the Company to use 20% of the gross proceeds raised from future equity or debt financings, or the sale of any subsidiary or material asset, to prepay the November Note, subject to a cap on the aggregate prepayment amount. Until all obligations under the November Note have been paid in full, the Company is not permitted to grant a security interest in any of its assets, or to issue securities convertible into shares of Common Stock, subject in each case to certain exceptions. verbMarketplace, LLC entered into a guaranty, dated November 7, 2022, in connection with the November Note Offering, pursuant to which it guaranteed the obligations of the Company under the November Note in exchange for receiving a portion of the loan proceeds.


Issuance of Common Stock


Subsequent to September 30, 2022, the Company issued 187,523 shares of common stock to vendors for services rendered with a grant date fair value of $64. These shares of common stock were valued based on the closing price of the Company’s common stock on the date of issuance or the date the Company entered into the agreement related to the issuance.


Subsequent to September 30, 2022, the Company issued 6,185 shares of common stock to certain employees associated with the vesting of restricted stock units.


Issuances of Stock Options


Subsequent to September 30, 2022, the Company granted stock options to certain employees to purchase a total of 32,000 stock options for services to be rendered. The options have an average exercise price of $0.38 per share, expire in five years, and vest four years from grant date. The total grant date fair value of these options was $8 based on the Black-Scholes option pricing model.




On November 9, 2022, the Company received a written notification from the Nasdaq Stock Market Listing Qualifications Staff (the “Staff”) indicating that the Company has been granted an additional 180-calendar-day period, or until May 8, 2023, to regain compliance with the $1.00 minimum closing bid price requirement for continued listing on the Nasdaq Capital Market pursuant to Nasdaq Listing Rules (the “Minimum Bid Price Requirement”).


Nasdaq’s determination was based on (i) the Company having met the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Nasdaq Capital Market, with the sole exception of the Minimum Bid Price Requirement, and (ii) the Company’s written notice to Nasdaq of its intention to cure the deficiency during the compliance period, including by potentially effecting a reverse stock split if necessary.  If, at any time during this additional compliance period, the closing bid price of the Common Stock is at least $1.00 per share for a minimum of ten consecutive trading days, Nasdaq will provide written confirmation of compliance.  If compliance cannot be demonstrated by May 8, 2023, the Staff will provide written notification that the Company’s securities will be delisted, provided that the Company may appeal the Staff’s determination to a Hearings Panel of Nasdaq at that time.


The Company will monitor the closing bid price of its Common Stock and will consider various options to regain compliance with the Minimum Bid Price Requirement before May 8, 2023.