Quarterly report pursuant to Section 13 or 15(d)

Equity

v3.24.0.1
Equity
 6 Months Ended
Dec. 31, 2023
Equity [Abstract]  
Equity

Note 12. Equity

 

Underwritten Offering of Common Stock

 

On January 29, 2024, the Company closed an underwritten public offering of 23,000,000 shares of its common stock at a price to the public of $0.50 per share pursuant to an underwriting agreement with Roth Capital Partners, LLC. The shares of common stock issued at closing included 3,000,000 shares issued pursuant to the underwriters’ over-allotment option, which was exercised in full. Gross proceeds totaled $11.5 million before deducting the underwriting discount and offering expenses of approximately $1.1 million resulting in net proceeds from the offering of approximately $10.4 million. Certain of the Company’s directors, officers and employees participated in the offering by purchasing an aggregate of $1.0 million of shares on the same terms and conditions as other investors.

 

Equity Incentive Plans

 

During the six months ended December 31, 2023, the Company granted employees options to purchase an aggregate of approximately 0.26 million shares of common stock. The fair values of the Company’s options were estimated at the dates of grant using a Black-Scholes option pricing model with the following assumptions:

 

    Six Months Ended
December 31,
2023		  
Exercise price   $ 0.59 – 0.97  
Expected term (years)     4.00 – 4.75  
Volatility     71 – 75 %
Risk-free interest rate     4.42 – 4.66 %
Dividend yield     0 %
Weighted Average Grant Date Fair Value of Options granted during the period   $ 0.35  

 

During the six months ended December 31, 2023 the Company awarded certain employees and directors grants of an aggregate of approximately 1.6 million restricted stock units (“RSUs”) with a weighted average grant date fair value of $0.81. The RSUs will be expensed over the requisite service period. The terms of the RSUs include vesting provisions based solely on continued service. If the service criteria are satisfied, the RSUs will generally vest over 4 – 5 years.

 

During the six months ended December 31, 2023 the Company awarded certain employees grants of an aggregate of approximately 0.55 million restricted stock units with market value appreciation conditions (“MVSUs”) with a weighted average grant date fair value of $1.41. The MVSUs will be expensed over the requisite service period. The terms of the MVSUs include vesting provisions based on continued service. The number of shares of the Company’s common stock earned at vesting is based on the Company’s stock price performance with amounts earned subject to a vesting multiplier ranging from 0% to 200%. If the service criteria are satisfied, the MVSUs will vest over 3 years.

 

Compensation expense related to our stock-based awards described above was as follows (in thousands):

 

    Three Months Ended
December 31,		     Six months ended
December 31,		  
    2023     2022     2023     2022  
Research and Development   $ 119     $ 883     $ 652     $ 2,051  
General and Administrative   $ 135     $ 1,012     $ 1,423     $ 2,193  
Cost of Revenue   $ 62      
—
     $ 124          
Total   $ 316     $ 1,895     $ 2,199     $ 4,244  

 

Unrecognized stock-based compensation expense and weighted-average years to be recognized are as follows (in thousands):

 

    As of December 31, 2023  
    Unrecognized
stock-based
compensation		     Weighted-
average years
to be recognized		  
Options   $ 974       1.73  
Restricted stock units   $ 7,519       1.99  

 

Nasdaq Stock Market notification

 

On October 24, 2023, the Company received notification from the Listing Qualifications Department of The Nasdaq Stock Market, or Nasdaq, stating that the Company did not comply with the minimum $1.00 bid price requirement for continued listing set forth in Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Requirement”). In accordance with Nasdaq listing rules, the Company has been afforded 180 calendar days (until April 22, 2024) to regain compliance with the Bid Price Requirement (the “Initial Compliance Period”). To regain compliance, the closing bid price of the Company’s common stock must meet or exceed $1.00 per share for a minimum of ten consecutive business days during this additional 180-day period, all as described in more detail in the Current Report on Form 8-K filed with the SEC on October 27, 2023. If the Company does not regain compliance by April 22, 2024, the Company may be eligible for an additional grace period. To qualify, the Company must, as of the final day of the Initial Compliance Period, meet the applicable market value of publicly held shares requirement for continued listing and all other applicable standards for initial listing on the Capital Market (except the Bid Price Requirement) based on the Company’s most recent public filings and market information and must notify Nasdaq of its intent to cure this deficiency. If the Company meets these requirements, the Nasdaq staff would be expected to grant an additional 180 calendar days for the Company to regain compliance with Bid Price Requirement.