Quarterly report pursuant to Section 13 or 15(d)

Common Stock Warrants

v3.20.1
Common Stock Warrants
3 Months Ended
Mar. 31, 2020
Common Stock Warrants  
Common Stock Warrants

Note 13 - Common Stock Warrants

 

A summary of the Company’s warrant issuance activity and related information for the quarters ended March 31, 2020 and March 31, 2019:

 

    Shares    

Weighted

Average

Exercise

Price

   

Weighted

Average

Remaining

Contractual

Life

 
Assumed as of the January 8, 2019 merger     12,108,743     $ 1.38       2.60  
Issued     17,500,000       0.75       2.84  
Outstanding and exercisable at March 31, 2019     29,608,743     $ 1.00       2.63  
                         
Outstanding and exercisable at December 31, 2019     44,806,076     $ 0.78       4.59  
Issued     513,567       0.75       6.13  
Outstanding and exercisable at March 31, 2020     45,319,643     $ 0.78       4.61  

 

The fair value of all warrants issued are determined by using the Black-Scholes valuation technique and were assigned based on the relative fair value of both the common stock and the warrants issued. The inputs used in the Black-Scholes valuation technique to value each of the warrants as of their respective issue dates are as follows:

 

Event Description   Date   Number of Warrants     H-CYTE Stock Price     Exercise Price of Warrant     Grant Date Fair Value     Life of Warrant   Risk Free Rate of Return (%)     Annualized Volatility Rate (%)  
Private placement   1/8/2019     5,000,000     $ 0.40     $ 0.75     $ 0.24     3 years     2.57       115.08  
Antidilution provision(1)   1/8/2019     2,023,438     $ 0.40     $ 0.40     $ 0.28     3 years     2.57       115.08  
Private placement   1/18/2019     6,000,000     $ 0.40     $ 0.75     $ 0.23     3 years     2.60       114.07  
Private placement   1/25/2019     1,250,000     $ 0.59     $ 0.75     $ 0.38     3 years     2.43       113.72  
Private placement   1/31/2019     437,500     $ 0.54     $ 0.75     $ 0.34     3 years     2.43       113.47  
Private placement   2/7/2019     750,000     $ 0.57     $ 0.75     $ 0.36     3 years     2.46       113.23  
Private placement   2/22/2019     375,000     $ 0.49     $ 0.75     $ 0.30     3 years     2.46       113.34  
Private placement   3/1/2019     125,000     $ 0.52     $ 0.75     $ 0.33     3 years     2.54       113.42  
Private placement   3/8/2019     150,000     $ 0.59     $ 0.75     $ 0.38     3 years     2.43       113.53  
Private placement   3/11/2019     2,475,000     $ 0.61     $ 0.75     $ 0.40     3 years     2.45       113.62  
Private placement   3/26/2019     500,000     $ 0.51     $ 0.75     $ 0.32     3 years     2.18       113.12  
Private placement   3/28/2019     375,000     $ 0.51     $ 0.75     $ 0.31     3 years     2.18       112.79  
Private placement   3/29/2019     62,500     $ 0.51     $ 0.75     $ 0.31     3 years     2.21       112.79  
Private placement   4/4/2019     500,000     $ 0.48     $ 0.75     $ 0.29     3 years     2.29       112.77  
Private placement   7/15/2019     200,000     $ 0.53     $ 1.00     $ 0.31     3 years     1.80       115.50  
Convertible debt extension   9/18/2019     424,000     $ 0.40     $ 0.75     $ 0.25     3 years     1.72       122.04  
Private placement of Series D Convertible Preferred Stock   11/15/2019     14,669,757     $ 0.28     $ 0.75     $ 0.19     10 years     1.84       89.75  
Short-term note related party   11/26/2019     400,000     $ 0.20     $ 0.75     $ 0.13     3 years     1.58       144.36  
Short-term note, related party   12/30/2019     171,429     $ 0.14     $ 0.75     $ 0.08     3 years     1.59       145.29  
Short-term note, related party   1/13/2020     268,571     $ 0.12     $ 0.75     $ 0.07     3 years     1.60       145.76  
Private placement of Series D Convertible Preferred Stock   1/17/2020     244,996     $ 0.15     $ 0.75     $ 0.13     10 years     1.84       144.32  

 

(1) The Company had warrants that triggered the required issuance of an additional 2,023,438 warrants as a result of the Company’s capital raise that gave those new investors a $0.40 per share investment price which required the old warrant holders to receive additional warrants since their price was $0.75 per share.

 

The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.