| Delaware (State or other jurisdiction of incorporation or organization) | | | 2834 (Primary Standard Industrial Classification Code Number) | | | 87-0652870 (I.R.S. Employer Identification Number) | |
| William R. Rohrlich, II Winstead PC 600 Travis Street Suite 5200 Houston, Texas 77002 Tel. (281) 681-5912 Fax (281) 681-5901 | | | M. Ali Panjwani Pryor Cashman LLP 7 Times Square New York, NY 10036 Tel. (212) 421-4100 | |
| Large accelerated filer ☐ | | | Accelerated filer ☐ | |
| Non-accelerated filer ☒ | | | Smaller reporting company ☒ | |
| Emerging growth company ☐ | | |
| | | Per Share and Accompanying Common Warrant | | | Per Pre- Funded Warrant and Accompanying Common Warrant | | | Total | | |||||||||
Offering price | | | | $ | | | | | $ | | | | | $ | | | |||
Placement agent fees(1) | | | | $ | | | | | $ | | | | | $ | | | |||
Proceeds, before expenses, to us(2) | | | | $ | | | | | $ | | | | | $ | | | |
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| Assumed combined offering price per share and Common Warrant (assuming no sale of Pre-Funded Warrants) | | | | | | | | $ | | | Assumed combined offering price per share and Common Warrant (assuming no sale of Pre-Funded Warrants) | | | | | | | | $ | 0.41 | | | |||||
| Historical net tangible book value per share as of September 30, 2023 | | | $ | 0.22 | | | | | | | | Historical net tangible book value per share as of September 30, 2023 | | | $ | 0.22 | | | | | | | | ||||
| Decrease in net tangible book value per share attributable to new investors | | | $ | | | | | | | | Increase in net tangible book value per share attributable to new investors | | | $ | 0.10 | | | | | | | | |||||
| As adjusted net tangible book value per share after this offering | | | | | | | | $ | | | As adjusted net tangible book value per share after this offering | | | | | | | | $ | 0.32 | | | |||||
| Dilution per share to new investors | | | | | | | | $ | | | | Dilution per share to new investors | | | | | | | | $ | 0.09 | | |
Element | | | Form of Compensation | | | Purpose, Basis and Performance Criteria | |
Base Salary | | | Cash | | | • Base salary is intended to provide a market competitive level of fixed compensation in recognition of responsibilities, skills, capabilities, experience and leadership. • Base salary is not generally performance based, but reflective of competencies and experience. | |
Element | | | Form of Compensation | | | Purpose, Basis and Performance Criteria | |
Annual Performance Incentive Awards (considered “at-risk” compensation) | | | Cash | | | • Annual cash performance incentive awards are intended to motivate and reward performance achievement. • Payments are discretionary and approved annually by the Compensation Committee. | |
Long-Term Incentive Awards (considered “at-risk” compensation) | | | Stock Options | | | • Long-term incentive awards are intended to recognize and reward the achievement of long-term corporate goals and objectives, recognize promotions, motivate retention of our leadership talent and align executives’ interests with our stockholders. • The Compensation Committee determines the amount of long-term incentive awards to be granted to each NEO. The Compensation Committee also may make isolated awards to recognize promotions, new hires or individual performance achievements. • In 2023, the long-term incentive awards included time-vested equity awards that vest over a four-year period. • The Compensation Committee provides time-vested long-term incentives (i) to build a consistent ownership stake and retention incentive, (ii) to create a meaningful tie to the Company’s relative long-term stockholder returns and (iii) to motivate consistent improvement over a longer-term horizon. | |
Change of Control Severance | | | Eligible to receive severance payments and post-termination health benefits in connection with involuntary termination within three months before or twelve months after a change of control | | | • Employment agreements are intended to provide financial security and an industry-competitive compensation package for NEOs. This additional security helps ensure that NEOs remain focused on our performance and the continued creation of stockholder value throughout any change of control transaction rather than on the potential uncertainties associated with their own employment. | |
Name and Principal Position | | | Year | | | Salary ($) | | | Bonus ($) | | | Option Awards ($)(1) | | | All Other Compensation ($) | | | Total ($) | | ||||||||||||||||||
Peter H. Nielsen, CEO, | | | | | 2023 | | | | | $ | 575,000(2) | | | | | $ | 110,000(3) | | | | | $ | 130,880 | | | | | $ | 11,237(4) | | | | | $ | 827,117 | | |
CFO, President, Chairman, Director | | | | | 2022 | | | | | $ | 555,000 | | | | | $ | 150,000 | | | | | $ | 288,669 | | | | | $ | 17,678(5) | | | | | $ | 1,011,347 | | |
| | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | | | All Other Stock Awards: Number of Shares of Stock or Units (#) | | | All Other Option Awards: Number of Securities Underlying Options (#) | | | Exercise or Base Price of Option Awards ($/Sh) | | | Grant Date Fair Value of Stock Awards ($)(2) | | |||||||||||||||||||||
Name | | | Grant Date | | | Threshold ($) | | | Target ($) | | | Maximum ($) | | ||||||||||||||||||||||||
Mr. Nielsen(1) | | | | | 5/2/2023 | | | | | | | | | | | | | | | | | | 105,000 | | | | | $ | 1.39 | | | | | $ | 1.25 | | |
Name | | | Number of Securities Underlying Unexercised Options Exercisable (#) | | | Number of Securities Underlying Unexercised Options Unexercisable (#) | | | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | | | Option Exercise Price ($) | | | Option Expiration Date | | ||||||||||||
Mr. Nielsen(1) | | | | | 2,761 | | | | | | — | | | | | | — | | | | | $ | 550.00 | | | | April 2026 | |
Mr. Nielsen(1) | | | | | 6,500 | | | | | | — | | | | | | — | | | | | $ | 36.80 | | | | April 2028 | |
Mr. Nielsen(1) | | | | | 15,000 | | | | | | — | | | | | | — | | | | | $ | 18.40 | | | | March 2029 | |
Mr. Nielsen(2) | | | | | 14,063 | | | | | | 937 | | | | | | — | | | | | $ | 3.25 | | | | March 2030 | |
Mr. Nielsen(3) | | | | | 74,375 | | | | | | 10,625 | | | | | | — | | | | | $ | 5.21 | | | | June 2030 | |
Mr. Nielsen(4) | | | | | 68,750 | | | | | | 31,250 | | | | | | — | | | | | $ | 7.02 | | | | March 2031 | |
Mr. Nielsen(5) | | | | | 39,375 | | | | | | 50,625 | | | | | | — | | | | | $ | 3.61 | | | | March 2032 | |
Mr. Nielsen(6) | | | | | — | | | | | | 105,000 | | | | | | — | | | | | $ | 1.39 | | | | May 2033 | |
| | | | | | Triggering Event | | |||||||||
Name | | | Benefit | | | Termination without Cause or Resignation for Good Reason ($) | | | Termination without Cause or Resignation for Good Reason within 3 Months Before or 12 Months Following a Change in Control ($) | | ||||||
Peter H. Nielsen | | | Market Value of Stock Vesting | | | | $ | — | | | | | $ | —(1) | | |
| | | Accrued Vacation Days | | | | | 36,923 | | | | | | 36,923 | | |
| | | Three Months’ Base Salary | | | | | 100,000 | | | | | | 100,000 | | |
| | | Continuation of Benefits | | | | | 1,667 | | | | | | 3,334 | | |
| | | Total | | | | $ | 138,590 | | | | | $ | 140,257 | | |
Name | | | Fees Earned or Paid in Cash | | | Option Awards | | | All Other Compensation | | | Total | | ||||||||||||
Heath W. Cleaver | | | | $ | 73,000(1) | | | | | $ | 12,306(2) | | | | | $ | — | | | | | $ | 85,306 | | |
Paul D. Aubert | | | | $ | 61,500(1) | | | | | $ | 12,306(2) | | | | | $ | — | | | | | $ | 73,806 | | |
Aline B. Sherwood | | | | $ | 64,500(1) | | | | | $ | 12,306(2) | | | | | $ | — | | | | | $ | 76,806 | | |
Douglas P. Morris(3) | | | | $ | — | | | | | $ | 16,235(4) | | | | | $ | 73,744(5) | | | | | $ | 89,979 | | |
Director | | | Number of shares underlying outstanding options | | |||
Heath W. Cleaver | | | | | 42,500 | | |
Paul D. Aubert | | | | | 42,000 | | |
Aline B. Sherwood | | | | | 20,000 | | |
Douglas P. Morris(1) | | | | | 52,375 | | |
| | | Per Share and Accompanying Common Warrant | | | Per Pre-Funded Warrant and Accompanying Common Warrant | | ||||||
Public offering price | | | | $ | | | | | $ | | | ||
Placement Agent fees | | | | $ | | | | | $ | | | ||
Proceeds, before expenses, to us | | | | $ | | | | | $ | | | |
| | AMOUNT | | | AMOUNT | | ||||||||
SEC registration fee | | | $ | 2,804.40 | | | | | $ | 3,505.50 | | | ||
FINRA Filing Fee | | | $ | 5,000 | | | | | $ | 5,000 | | | ||
Printing and related expenses | | | $ | 2,500 | | | | | $ | 2,500 | | | ||
Legal fees and expenses | | | $ | 80,000 | | | | | $ | 80,000 | | | ||
Transfer agent and registrar fees and expenses | | | $ | 10,000 | | | | | $ | 10,000 | | | ||
Accounting fees and expenses | | | $ | 10,000 | | | | | $ | 10,000 | | | ||
Miscellaneous expenses | | | $ | 1,000 | | | | | $ | 1,000 | | | ||
Total | | | $ | 111,304.40 | | | | | $ | 112,005.50 | | |
| /s/ Peter H. Nielsen Peter H. Nielsen President, Chief Executive Officer (Principal Executive Officer), Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) and Director | | | | |
| Heath W. Cleaver Director | | | | |
| Paul D. Aubert Director | | | | |
| Aline Sherwood Director | | | | |
| Douglas P. Morris Director and Secretary | | | | |
| *By: /s/ Peter H. Nielsen Peter H. Nielsen, Attorney-In-Fact | | | | |