NOTE 11 — SUBSEQUENT EVENTS

Purchase Agreement

On January 28, 2021, the Company entered into the Purchase Agreement with the Purchasers, pursuant to which the Company issued and closed on February 1, 2021, (i) in the Offering an aggregate of 914,136 shares of common stock of the Company, at an offering price of $10.54 per share and (ii) in a concurrent private placement warrants to purchase an aggregate of 457,068 shares of common stock at an exercise price of $14.50 per share, for gross proceeds from the Offering of approximately $9.6 million before the deduction of financial advisory fees and offering expenses. As of January 31, 2021, certain of these investors completed and funded their subscription agreements (see Note 8).

Pursuant to the Purchase Agreement, the warrants are exercisable six months following the date of issuance and terminate five years following the initial exercise date. A holder of such warrant will not have the right to exercise any portion of its warrants if the holder, together with its affiliates, would beneficially own in excess of 4.99% (or 9.99% at the election of the holder prior to the date of issuance) of the number of shares of common stock outstanding immediately after giving effect to such exercise (the “Beneficial Ownership Limitation”); provided, however, that upon 61 days’ prior notice to the Company, the holder may increase the Beneficial Ownership Limitation, provided that in no event shall the Beneficial Ownership Limitation exceed 9.99%.

On January 27, 2021, the Company entered into an amendment to that certain engagement agreement (“Engagement Agreement Amendment”) with Palladium Capital Group, LLC (“Palladium”), dated March 29, 2020, in connection with the Offering, among other things. Pursuant to the Engagement Agreement Amendment, the Company agreed to pay Palladium a cash fee equal to 8% of the aggregate gross proceeds received by the Company in the Offering from investors introduced to the Company by Palladium. In addition, the Company issued to Palladium warrants to purchase up to 46,490 shares of common stock which are identical in all material respects to the warrants issued pursuant to the Purchase Agreement.

Restricted Stock Unit

On February 14, 2021, the Company granted an aggregate of 3,946 restricted stock units to a director of the Company for services rendered. The 3,946 restricted stock units had a fair value of $50,000 or $12.67 per share of common stock based on the quoted trading price on the date of grant. The restricted stock units fully vested and expensed immediately.

Income Tax Refund

On March 1, 2021, the Company collected $219,072 of the income tax receivable.

Common Stock issued for exercise of Stock Warrants

In February 2021 and March 2021, the Company issued an aggregate of 178,571 shares of common stock for the exercise of stock warrants and received proceeds of $1,250,000.

In February 2021, the Company issued 91,894 shares of common stock for the cashless exercise of 166,666 stock warrants.