Quarterly report pursuant to Section 13 or 15(d)

STOCKHOLDERS' DEFICIT (Tables)

v3.22.2.2
STOCKHOLDERS' DEFICIT (Tables)
6 Months Ended
Jun. 30, 2022
Schedule of Fair Value Based upon Assumptions

The fair value as of June 30, 2022 and December 31, 2021 was based upon following assumptions:

 

 

 

June 30, 2022

 

 

December 31, 2021

 

Principal outstanding (South Korean won)

 

KRW 26.5 billion

 

 

KRW 30 billion

 

Stock price

 

KRW1,400

 

 

KRW2,925

 

Expected life (in years)

 

 

8.30

 

 

 

8.79

 

Selected yield

 

 

14.75

%

 

 

10.50

%

Expected volatility (Telcon common stock)

 

 

79.50

%

 

 

81.31

%

Risk-free interest rate (South Korea government bond)

 

 

3.64

%

 

 

2.19

%

Expected dividend yield

 

 

 

 

 

 

Conversion price

 

KRW1,498 (US$1.16)

 

 

KRW2,847 (US$2.39)

 

Summary of outstanding warrants

A summary of outstanding warrants as of June 30, 2022 and December 31, 2021 is presented below:

 

 

 

June 30, 2022

 

 

December 31, 2021

 

 

 

Number of

Warrants

 

 

Weighted‑

Average

Exercise

Price

 

 

Number of

Warrants

 

 

Weighted‑

Average

Exercise

Price

 

Warrants outstanding, beginning of period

 

 

8,236,017

 

 

$

5.78

 

 

 

8,439,480

 

 

$

6.09

 

Granted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercised

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cancelled, forfeited or expired

 

 

(1,365,189

)

 

$

4.76

 

 

 

(203,463

)

 

$

4.36

 

Warrants outstanding, end of period

 

 

6,870,828

 

 

$

5.45

 

 

 

8,236,017

 

 

$

5.78

 

Warrnts exercisable end of period

 

 

6,870,828

 

 

$

5.45

 

 

 

7,486,017

 

 

$

6.12

 

Summary of stock option activity

A summary of outstanding stock options as of June 30, 2022 and December 31, 2021 is presented below.

 

 

 

June 30, 2022

 

 

December 31, 2021

 

 

 

Number of

Options

 

 

Weighted‑

Average

Exercise

Price

 

 

Number of

Options

 

 

Weighted‑

Average

Exercise

Price

 

Options outstanding, beginning of period

 

 

5,968,338

 

 

$

4.78

 

 

 

7,110,025

 

 

$

4.63

 

Granted or deemed granted

 

 

 

 

$

 

 

 

 

 

$

 

Exercised

 

 

 

 

$

 

 

 

 

 

$

 

Cancelled, forfeited and expired

 

 

(1,055,399

)

 

$

3.45

 

 

 

(1,141,687

)

 

$

3.82

 

Options outstanding, end of period

 

 

4,912,939

 

 

$

5.07

 

 

 

5,968,338

 

 

$

4.78

 

Options exercisable, end of period

 

 

4,892,438

 

 

$

5.09

 

 

 

5,937,837

 

 

$

4.80

 

Options available for future grant

 

 

4,000,000

 

 

 

 

 

 

 

4,000,000

 

 

 

 

 

 

Convertible Promissory Note [Member]  
Schedule of fair value of conversion feature liabilities

The following table presents the fair value and the change in fair value of the warrants as of June 15, 2022 and December 31, 2020 (in thousands):

Warrant liability—Convertible Promissory Note

 

June 15, 2022

 

 

December 31, 2021

 

Balance, beginning of period

 

$

1,463

 

 

$

988

 

Change in fair value included in the statement of operations

 

 

(1,250

)

 

 

475

 

Reclassification to equity

 

 

(213

)

 

 

 

Balance, end of period

 

$

 

 

$

1,463

 

Schedule of Fair Value Based upon Assumptions

The fair value of the warrant derivative liability was determined using the Black-Scholes Merton model based upon following assumptions:

 

 

June 15, 2022

 

 

December 31, 2021

 

Exercise price

 

$

2.05

 

 

$

2.05

 

Stock price

 

$

0.36

 

 

$

1.67

 

Risk‑free interest rate

 

 

3.35

%

 

 

1.04

%

Expected volatility (peer group)

 

 

126.00

%

 

 

117.00

%

Expected life (in years)

 

 

3.00

 

 

 

3.46

 

Expected dividend yield

 

 

 

 

Number outstanding

 

 

1,250,000

 

 

 

1,250,000

 

 

GPB Debt Holdings II, LLC [Member]  
Schedule of fair value of conversion feature liabilities

The following table presents the change in fair value of the GPB Warrant as of June 30, 2022 and December 31, 2021 (in thousands):

 

Warrant Liability—GPB

 

June 30, 2022

 

 

December 31, 2021

 

Balance, beginning of period

 

$

40

 

 

$

83

 

Change in fair value included in the statement of operations

 

 

(40

)

 

 

(43

)

Balance, end of period

 

$

 

 

$

40

 

Schedule of Fair Value Based upon Assumptions

The fair value of the warrant derivative liability was determined using the Black-Scholes Merton model. The fair value as of June 30, 2022, and December 31, 2021 was based upon the following assumptions:

 

 

 

June 30, 2022

 

 

December 31, 2021

 

Adjusted exercise price

 

$

10.28

 

 

$

10.28

 

Common stock fair value

 

$

0.45

 

 

$

1.67

 

Risk‑free interest rate

 

 

2.80

%

 

 

0.56

%

Volatility

 

 

121.00

%

 

 

104.00

%

Time until expiration (years)

 

 

1.00

 

 

 

1.50

 

Expected dividend yield

 

 

 

 

Number outstanding

 

 

252,802

 

 

 

252,802