Quarterly report pursuant to Section 13 or 15(d)

Note 9 - Private Placement

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Note 9 - Private Placement
 9 Months Ended
Sep. 30, 2021
Notes to Financial Statements  
Stockholders' Equity Note Disclosure [Text Block]

9.

Private Placement

 

On August 26, 2021, the Company completed a private offering of 1,400,000 units at a price of $2.00 per unit, each unit consisting of one share of common stock and one warrant exercisable at $3.00 for one share of common stock. No commissions were payable in connection with this offering. The warrants expire on August 31, 2026. 1,400,000 shares of common stock issuable upon exercise of warrants in connection with the offering have been reserved for issuance. The net proceeds of the transaction of $2,800,000 will be used for general corporate purposes.

 

The shares are unregistered and are subject to a six-month holding period under SEC Rule 144 before the securities can be sold in the public market. The warrants are also exercisable for unregistered shares and are freely transferable after six months from their issuance. The shares underlying the warrants must be held for a period of at least six months if exercised for cash. If exercised on a cashless basis, the shares can be freely traded once the holding period of the warrants and the shares is at least six months combined. The warrants are freestanding securities that are separately exercisable and legally detachable from the common shares and have been classified as equity in accordance with ASC Topic 480, Distinguishing Liabilities from Equity. The proceeds from the offering were allocated using the relative fair value method as follows:

 

           

Additional

          
   

Common

    

Paid-In

          
   

Stock

    

Capital

    

Total

  

Unregistered shares

   $ 14,000     $ 2,142,000     $ 2,156,000  

Warrants

     -       644,000       644,000  

Total

   $ 14,000     $ 2,786,000     $ 2,800,000