ASPIRA WOMEN'S HEALTH INC., 10-K filed on 30 Mar 23
v3.23.1
Document and Entity Information - USD ($)
12 Months Ended
Dec. 31, 2022
Mar. 20, 2023
Jun. 30, 2022
Document And Entity Information [Abstract]      
Document Type 10-K    
Document Annual Report true    
Document Period End Date Dec. 31, 2022    
Document Transition Report false    
Current Fiscal Year End Date --12-31    
Entity File Number 001-34810    
Entity Registrant Name Aspira Women’s Health Inc.    
Entity Incorporation, State or Country Code DE    
Entity Tax Identification Number 33-0595156    
Entity Address, Address Line One 12117 Bee Caves Road    
Entity Address, Address Line Two Building III    
Entity Address, Address Line Three Suite 100    
Entity Address, City or Town Austin    
Entity Address, State or Province TX    
Entity Address, Postal Zip Code 78738    
City Area Code 512    
Local Phone Number 519-0400    
Title of 12(b) Security Common Stock, par value $0.001 per share    
Trading Symbol AWH    
Security Exchange Name NASDAQ    
Entity Well-known Seasoned Issuer No    
Entity Voluntary Filers No    
Entity Current Reporting Status Yes    
Entity Interactive Data Current Yes    
Entity Filer Category Non-accelerated Filer    
Entity Small Business true    
Entity Emerging Growth Company false    
ICFR Auditor Attestation Flag false    
Entity Shell Company false    
Entity Public Float     $ 50,183,661
Entity Common Stock, Shares Outstanding   124,943,144  
Document Fiscal Year Focus 2022    
Document Fiscal Period Focus FY    
Entity Central Index Key 0000926617    
Amendment Flag false    
Documents Incorporated by Reference Certain information from the registrant’s Definitive Proxy Statement for its 2023 Annual Meeting of Stockholders is incorporated by reference into Part III of this report. The registrant intends to file the Proxy Statement with the Securities and Exchange Commission within 120 days of December 31, 2022.    
Auditor Name BDO USA, LLP    
Auditor Location Woodbridge, New Jersey    
Auditor Firm ID 243    
v3.23.1
Consolidated Balance Sheets - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Current assets:    
Cash and cash equivalents $ 13,306 $ 37,180
Accounts receivable, net of allowance of $9 and $23, respectively 1,245 1,027
Prepaid expenses and other current assets 1,442 1,624
Inventories 316 174
Total current assets 16,309 40,005
Property and equipment, net 368 464
Right-of-use assets 282 346
Restricted cash 251 250
Other assets 163 14
Total assets 17,373 41,079
Current liabilities:    
Accounts payable 881 1,501
Accrued liabilities 3,650 5,299
Current portion of long-term debt 403 201
Short-term debt 764 779
Lease liability 77 60
Total current liabilities 5,775 7,840
Non-current liabilities:    
Long-term debt 2,315 2,718
Lease liability 272 349
Warrant liabilities 2,280  
Total liabilities 10,642 10,907
Commitments and contingencies (Note 2)
Stockholders' equity:    
Common stock, par value $0.001 per share, 150,000,000 shares authorized at December 31, 2022 and December 31, 2021; 124,594,888 and 112,138,741 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively 125 112
Additional paid-in capital 505,504 501,788
Accumulated deficit (498,898) (471,728)
Total stockholders' equity 6,731 30,172
Total liabilities and stockholders' equity $ 17,373 $ 41,079
v3.23.1
Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Consolidated Balance Sheets [Abstract]    
Accounts receivable, allowance $ 9 $ 23
Common stock, par value $ 0.001 $ 0.001
Common stock, shares authorized 150,000,000 150,000,000
Common stock, shares issued 124,594,888 112,138,741
Common stock, shares outstanding 124,594,888 112,138,741
v3.23.1
Consolidated Statements Of Operations - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Revenue:    
Revenue $ 8,184 $ 6,812
Cost of revenue:    
Cost of revenue 3,865 3,750
Gross profit 4,319 3,062
Operating expenses:    
Research and development 5,953 5,314
Sales and marketing 14,948 17,086
General and administrative 16,183 13,257
Total operating expenses 37,084 35,657
Loss from operations (32,765) (32,595)
Change in fair value of warrant liabilities 5,472  
Interest income (expense), net 17 (48)
Other income , net 106 981
Net loss $ (27,170) $ (31,662)
Net loss per share - basic $ (0.23) $ (0.28)
Net loss per share - diluted $ (0.23) $ (0.28)
Weighted average number of common shares used to compute basic net loss per common share 116,536,631 111,210,614
Weighted average number of common shares used to compute diluted net loss per common share 116,536,631 111,210,614
Product [Member]    
Revenue:    
Revenue $ 7,970 $ 6,568
Cost of revenue:    
Cost of revenue 3,698 3,016
Genetics [Member]    
Revenue:    
Revenue 214 244
Cost of revenue:    
Cost of revenue $ 167 $ 734
v3.23.1
Consolidated Statements Of Operations (Parenthetical) - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Stock-based compensation expense $ 2,410 $ 3,371
Cost Of Revenue [Member]    
Stock-based compensation expense 80 161
Research And Development [Member]    
Stock-based compensation expense 203 311
Sales And Marketing [Member]    
Stock-based compensation expense 356 1,132
General And Administrative [Member]    
Stock-based compensation expense $ 2,037 $ 1,935
v3.23.1
Consolidated Statements Of Changes In Stockholders' Equity - USD ($)
$ in Thousands
Common Stock [Member]
Additional Paid-In Capital [Member]
Accumulated Deficit [Member]
Total
Balance (in shares) at Dec. 31, 2020 104,619,876      
Balance at Dec. 31, 2020 $ 105 $ 449,680 $ (440,066) $ 9,719
Net loss     (31,662) $ (31,662)
Common stock issued in conjunction with exercise of stock options (in shares) 557,566     557,566
Common stock issued in conjunction with exercise of stock options   718   $ 718
Common stock issued in conjunction with public offering, net of issuance costs (in shares) 6,900,000      
Common stock issued in conjunction with public offering, net of issuance costs $ 7 47,851   47,858
Common stock issued for restricted stock awards (in shares) 61,299      
Common stock issued for restricted stock awards   455   455
Stock-based compensation expense   3,084   3,084
Balance (in shares) at Dec. 31, 2021 112,138,741      
Balance at Dec. 31, 2021 $ 112 501,788 (471,728) 30,172
Net loss     (27,170) $ (27,170)
Common stock issued in conjunction with exercise of stock options (in shares) 23,000     23,000
Common stock issued in conjunction with exercise of stock options   13   $ 13
Common stock and warrants issued in conjunction with follow-on public offering, net of issuance costs $ 12 1,028   1,040
Common stock and warrants issued in conjunction with follow-on public offering, net of issuance costs (in shares) 12,000,000      
Common stock issued for restricted stock awards (in shares) 433,147      
Common stock issued for restricted stock awards $ 1 362   363
Stock-based compensation expense   2,313   2,313
Balance (in shares) at Dec. 31, 2022 124,594,888      
Balance at Dec. 31, 2022 $ 125 $ 505,504 $ (498,898) $ 6,731
v3.23.1
Consolidated Statements Of Cash Flows - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Cash flows from operating activities:    
Net loss $ (27,170) $ (31,662)
Adjustments to reconcile net loss to net cash used in operating activities:    
Non-cash lease expense 4 37
Depreciation and amortization 264 302
Stock-based compensation expense 2,676 3,539
Change in fair value of warrant liabilities (5,472)  
Loss on impairment and disposal of property and equipment 64 1
Forgiveness of PPP loan   (1,006)
Changes in operating assets and liabilities:    
Accounts receivable (218) (162)
Prepaid expenses and other assets 33 (548)
Inventories (142) (144)
Accounts payable, accrued liabilities and other liabilities (2,224) 2,248
Net cash used in operating activities (32,185) (27,395)
Cash flows from investing activities:    
Purchase of property and equipment (232) (184)
Net cash used in investing activities (232) (184)
Cash flows from financing activities:    
Principal repayment of DECD loan (261) (198)
Proceeds from issuance of common stock from exercise of stock options 13 718
Proceeds from public offering 9,000 48,235
Payment of issuance costs for public offering (208) (377)
Net cash provided by financing activities 8,544 48,378
Net (decrease) increase in cash, cash equivalents and restricted cash (23,873) 20,799
Cash, cash equivalents and restricted cash, beginning of period 37,430 16,631
Cash, cash equivalents and restricted cash, end of period 13,557 37,430
Reconciliation to Consolidated Balance Sheet:    
Cash and cash equivalents 13,306 37,180
Restricted cash 251 250
Unrestricted and restricted cash and cash equivalents 13,557 37,430
Supplemental disclosure of cash flow information:    
Cash paid during the period for interest 77 77
Supplemental disclosure of noncash investing and financing activities:    
Net decrease in right-of-use assets   $ (1,006)
Forgiveness of PPP loan $ 7,752  
v3.23.1
Basis Of Presentation And Summary Of Significant Accounting And Reporting Policies
12 Months Ended
Dec. 31, 2022
Basis Of Presentation And Summary Of Significant Accounting And Reporting Policies [Abstract]  
Basis Of Presentation And Summary Of Significant Accounting And Reporting Policies NOTE 1:Basis of Presentation and Summary of Significant Accounting and Reporting Policies

Organization and Basis of Presentation

Aspira Women’s Health Inc., formerly known as Vermillion, Inc. (“Aspira,” and together with its wholly-owned subsidiaries, the “Company”) is incorporated in the state of Delaware, and is engaged in the business of developing and commercializing diagnostic tests for gynecologic disease. The Company currently markets and sells the following products and related services: (1) Ova1, a blood test intended as an aid to further assess the likelihood of malignancy in women with an ovarian adnexal mass for which surgery is planned when the physician’s independent clinical and radiological evaluation does not indicate malignancy; (2) Overa, a second-generation biomarker reflex intended to maintain Ova1’s high sensitivity while improving specificity; (3) Ova1Plus, a reflex offering which uses Ova1 as the primary test and Overa as a confirmation for Ova1 intermediate range results; and (4) OvaWatch, a lab developed blood test intended to assist in the initial clinical assessment of malignancy risk in all women with an adnexal mass. Collectively, these tests are referred to and marketed as OvaSuite. For the year ended December 31, 2022, the Company’s product and related revenue was limited to these products, and Aspira GenetiX which was discontinued in the third quarter of 2022. The Company’s products are distributed through its own national sales force, through its proprietary decentralized testing platform and cloud service marketed as Aspira Synergy, and through a marketing and distribution agreement with BioReference Health, LLC (formerly known as BioReference Laboratories, Inc.).

Liquidity

The Company has incurred significant net losses and negative cash flows from operations since inception, and as a result has an accumulated deficit of approximately $498.9 million and working capital of $10.5 million as of December 31, 2022. For the year ended December 31, 2022, the Company incurred a net loss of $27.2 million and used cash in operations of $32.2 million. The Company also expects to incur a net loss and negative cash flows from operations for 2023. In the event that the Company’s existing cash on hand is not sufficient to fund operations, meet its capital requirements or satisfy the anticipated obligations as they become due, the Company expects to take further action to protect its liquidity position.

Such actions may include, but are not limited to:

Raising capital through an equity offering either in the public markets or via a private placement offering (however, no assurance can be given that capital will be available on acceptable terms, or at all);

Securing debt, however, no assurance can be given that debt will be available on acceptable terms or at all;

Reducing executive bonuses or replacing cash compensation with equity grants;

Reducing professional services and consulting fees and eliminating non-critical projects;

Reducing travel and entertainment expenses; and

Reducing, eliminating or deferring discretionary marketing programs.

The Company also has outstanding warrants to purchase shares of its common stock that may be exercised although there can be no assurance that the warrants will be exercised.

There can be no assurance that the Company will achieve or sustain profitability or positive cash flow from operations. Management expects cash from product sales and licensing to be the Company’s only material, recurring source of cash in 2023. Given the above conditions, there is substantial doubt about the Company’s ability to continue as a going concern within one year after the date these financial statements are filed. The consolidated financial statements have been prepared on a going concern basis and do not include any adjustments that might result from these uncertainties.

On June 1, 2022, the Company received a deficiency letter from the Listing Qualifications Department of The Nasdaq Stock Market stating that, for the preceding 30 consecutive business days, the closing bid price for Aspira common stock was below the minimum $1.00 per share requirement for continued inclusion on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2). On November 29, 2022, the Company was granted an additional 180-calendar day compliance period, or until May 29, 2023, to regain compliance with the minimum bid price requirement. The Company may achieve compliance during this period if the

closing bid price of Aspira common stock is at least $1.00 per share for a minimum of 10 consecutive business days. There is no assurance that the Company will be able to regain compliance by the May 29, 2023 extended deadline, and there is no assurance that the Company will otherwise maintain compliance with this or any of the other Nasdaq continued listing requirements.

In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China. The novel coronavirus has since spread to over 100 countries, including every state in the United States. In March 2020, the World Health Organization declared COVID-19, the disease caused by the novel coronavirus, a pandemic, and the United States declared a national emergency with respect to the coronavirus outbreak.

As a result of the COVID-19 pandemic and actions taken to contain it, the Company’s test volume, and resulting revenue, decreased significantly through the beginning of the third quarter of 2020. The full impact of the COVID-19 pandemic continues to evolve as of the date these financial statements are first filed with the SEC. As a result, the Company is unable to estimate the extent of the impact of the COVID-19 pandemic on its operations or liquidity.

Basis of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions have been eliminated in consolidation.

Use of Estimates

The preparation of consolidated financial statements in accordance with generally accepted accounting principles in the U.S. (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The primary estimates underlying the Company’s consolidated financial statements include assumptions regarding revenue recognition as well as variables used in calculating the fair value of the Company’s equity awards, warrants, income taxes and contingent liabilities. Changes in estimates and assumptions are reflected in reported results in the period in which they become known. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash and highly liquid investments with maturities of three months or less from the date of purchase, which are readily convertible into known amounts of cash and are so near to their maturity that they present an insignificant risk of changes in value because of interest rate changes. Highly liquid investments that are considered cash equivalents include money market funds, certificates of deposits, treasury bills and commercial paper.

Restricted Cash

Restricted cash consists of a security deposit for a financing arrangement.

Fair Value Measurement

Accounting Standards Codification (“ASC”) Topic 820, Fair Value and Measurements (“ASC 820”), defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

Level 1 – Quoted prices in active markets for identical assets or liabilities.

Level 2 – Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

If a financial instrument uses inputs that fall in different levels of the hierarchy, the instrument will be categorized based upon the lowest level of input that is significant to the fair value calculation.

Financial instruments of the Company consist primarily of cash and cash equivalents, restricted cash accounts, receivable, and accounts payable, and warrant liability. These items are considered Level 1 due to their short-term nature and their market interest rates, except for warrant liability, which is considered Level 2 and is recorded at fair value at the end of each reporting period.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents and accounts receivable. The Company maintains cash and cash equivalents in recognized financial institutions in the United States. The funds are insured by the FDIC up to a maximum of $250,000, but are otherwise unprotected. The Company has not experienced any losses associated with deposits of cash and cash equivalents. The Company does not invest in derivative instruments or engage in hedging activities.

Accounts Receivable

Virtually all accounts receivable are derived from sales made to customers located in North America. The Company performs ongoing credit evaluations of its customers’ financial condition and generally does not require collateral. The Company maintains an allowance for doubtful accounts based upon the expected collectability of accounts receivable.

Inventory

The Company has inventory consisting primarily of kit inventory for specimen delivery as well as reagents used for specimen testing and miscellaneous inventory such as pipettes, gloves and other non-reagent items.

At each reporting period the Company reviews its inventories for obsolescence and writes down obsolete or otherwise unmarketable inventory to its estimated net realized value, which is primarily related to kit inventory when kits expire. Inventory is valued at cost using the first-in-first-out method.

Property and Equipment

Property and equipment are carried at cost less accumulated depreciation and amortization. Property and equipment are depreciated when placed into service using the straight-line method over the estimated useful lives, generally three to five years. Leasehold improvements are amortized using the straight-line method over the shorter of the estimated useful life of the asset or the remaining term of the lease. Maintenance and repairs are charged to operations as incurred. Upon sale or retirement of assets, the cost and related accumulated depreciation are removed from the balance sheet and the resulting gain or loss is reflected in operations.

Property and equipment are reviewed for impairment when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. If property and equipment are considered to be impaired, an impairment loss is recognized.

Revenue Recognition

Product Revenue – OvaSuite: The Company recognizes product revenue in accordance with the provisions of ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”). Product revenue is recognized upon completion of the OvaSuite test and delivery of results to the physician based on estimates of amounts that will ultimately be realized. In determining the amount of revenue to be recognized for a delivered test result, the Company considers factors such as payment history and amount, payer coverage, whether there is a reimbursement contract between the payer and the Company, and any developments or changes that could impact reimbursement. These estimates require significant judgment by management as the collection cycle on some accounts can be as long as one year. The effect of any change made to an estimated input component and, therefore revenue recognized, would be recorded as a change in estimate at the time of the change.

The Company also reviews its patient account population and determines an appropriate distribution of patient accounts by payer (i.e., Medicare, patient pay, other third-party payer, etc.) into portfolios with similar collection experience. The Company has elected this practical expedient that, when evaluated for collectability, results in a materially consistent revenue amount for such portfolios as if each patient account were evaluated on an individual contract basis. During the years ended December 31, 2022 and

2021, there were no adjustments to estimates of variable consideration to derecognize revenue for services provided in a prior period. There were no impairment losses on accounts receivable recorded during the years ended December 31, 2022 and 2021.

Genetics Revenue – Aspira GenetiX: Under ASC 606, the Company’s genetics revenue was recognized upon completion of the Aspira GenetiX test and delivery of results to the physician based on estimates of amounts that would ultimately be realized. In determining the amount of revenue to be recognized for a delivered test result, the Company considered factors such as payment history and amount, payer coverage, whether there was a reimbursement contract between the payer and the Company, and any developments or changes that could impact reimbursement. These estimates required significant judgment by management as the Company has limited experience with such factors relating to Aspira GenetiX.

In September 2022, the Company received a notice of cancellation from its only Aspira Synergy genetics carrier screening customer, Axia Women’s Health. As a result of this cancellation, along with the general deterioration of commercial opportunities in the genetics carrier screening market, has led the Company to cease providing Aspira GenetiX, including genetics carrier screening, on the Aspira Synergy platform, effective as of September 30, 2022. The Company did not incur any termination penalties nor did the Company accrue any expenses as a result of the cancellation. This did not have a material impact on Company revenues in 2022 nor does management expect it to have a material impact in any future periods.

Research and Development Costs

Research and development costs are expensed as incurred. Research and development costs consist primarily of payroll and related costs, materials and supplies used in the development of new products, and fees paid to third parties that conduct certain research and development activities on behalf of the Company. In addition, acquisitions of assets to be consumed in research and development, with no alternative future use, are expensed as incurred as research and development costs. Software development costs incurred in the research and development of new products are expensed as incurred until technological feasibility is established.

Patent Costs

Costs incurred in filing, prosecuting and maintaining patents (principally legal fees) are expensed as incurred and recorded within general and administrative expenses on the Consolidated Statements of Operations. Such costs aggregated to approximately $410,000 and $202,000 for the years ended December 31, 2022 and 2021, respectively.

Stock-Based Compensation

The Company records the fair value of non-cash stock-based compensation costs for stock options related to the 2019 Stock Incentive Plan (“2019 Plan”). The Company estimates the fair value of stock options using a Black-Scholes option valuation model. This model requires the input of subjective assumptions including expected stock price volatility, expected life and estimated forfeitures of each award. The Company uses the straight-line method to amortize the fair value over the requisite service period of the award, which is generally equal to the vesting period. These assumptions consist of estimates of future market conditions, which are inherently uncertain, and therefore are subject to management's judgment.

The expected life of options is based on historical data of actual experience with the options granted and represents the period of time that the options granted are expected to be outstanding. This data includes employees’ expected exercise and post-vesting employment termination behaviors. The expected stock price volatility is estimated using Company historical volatility in deriving the expected volatility assumption. The Company made an assessment that Company historic volatility is most representative of future stock price trends. The expected dividend yield is based on the estimated annual dividends that are expected to be paid over the expected life of the options as a percentage of the market value of the Company’s common stock as of the grant date. The risk-free interest rate for the expected life of the options granted is based on the United States Treasury yield curve in effect as of the grant date. The Company records stock-based compensation net of estimated forfeitures.

Contingencies

The Company accounts for contingencies in accordance with ASC 450 Contingencies (“ASC 450”) which requires that an estimated loss from a loss contingency be accrued when (i) information available prior to issuance of the financial statements indicates that it is probable that an asset has been impaired or a liability has been incurred at the date of the financial statements and (ii) when the amount of the loss can be reasonably estimated. Accounting for contingencies such as legal and contract dispute matters requires

the use of management’s judgment. Management believes that the Company’s accruals for these matters are adequate. Nevertheless, the actual loss from a loss contingency might differ from management’s estimates.

Income Taxes

The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and the tax bases of assets and liabilities using the current tax laws and rates. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts more likely than not expected to be realized.

ASC Topic 740, Accounting for Uncertainty in Income Taxes clarifies the accounting for uncertainty in income taxes recognized in the financial statements and provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. This interpretation also provides guidance on measurement, derecognition, classification, interest and penalties, accounting in interim periods, and disclosure.

The Company recognizes interest and penalties related to unrecognized tax benefits within the interest expense line and other expense line, respectively, in the Consolidated Statements of Operations. Accrued interest and penalties are included within the related liability lines in the Consolidated Balance Sheets.

Net Loss Per Share

Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the period. Diluted loss per share is computed by dividing the net loss by the weighted average number of shares of common stock adjusted for the dilutive effect of common stock equivalent shares outstanding during the period. Common stock equivalents consist of stock options, restricted stock units and stock warrants. Common equivalent shares are excluded from the computation in periods in which they have an anti-dilutive effect on earnings per share.

Fair Value of Financial Instruments

Financial instruments include cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities, warrants and debt. The estimated fair value of financial instruments has been determined using available market information or other appropriate valuation methodologies. However, considerable judgment is required in interpreting market data to develop estimates of fair value; therefore, the estimates are not necessarily indicative of the amounts that could be realized or would be paid in a current market exchange. The effect of using different market assumptions and/or estimation methodologies may be material to the estimated fair value amounts. The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities are at cost, which approximates fair value due to the short maturity of those instruments. The carrying amount of restricted cash represents a long-term security deposit for a financial arrangement that is at cost. The carrying value of warrants is their fair value at the end of the period. The carrying value of debt approximates fair value due to its interest rate approximating market rates of interest available to the Company for similar instruments.

Leases

The Company determines if a contract, at its inception, is a lease or contains a lease based on whether the contract conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. To determine whether a contract conveys the right to control the use of an identified asset for a period of time, the Company assesses whether, throughout the period of use, it has both the right to obtain substantially all of the economic benefits from use of the identified asset, and the right to direct the use of the identified asset.

Lease classification, recognition, and measurement are then determined at the lease commencement date. For arrangements that contain a lease the Company (i) identifies lease and non-lease components, (ii) determines the consideration in the contract, (iii) determines whether the lease is an operating or financing lease; and (iv) recognizes lease ROU assets and liabilities. Lease liabilities and their corresponding ROU assets are recorded based on the present value of lease payments over the expected lease term. The interest rate implicit in lease contracts is typically not readily determinable and as such, the Company uses an incremental borrowing rate based on the information available at the lease commencement date, which represents a rate that would be incurred to borrow, on a collateralized basis, over a similar term, an amount equal to the lease payments in a similar economic environment.

The Company enters into contracts that contain both lease and non-lease components. Non-lease components may include items such as maintenance, utilities, or other operating costs. For leases of real estate, the Company combines the lease and associated non-lease components in its lease arrangements as a single lease component. Variable costs, such as utilities or maintenance costs, are not included in the measurement of right-of-use assets and lease liabilities, but rather are expensed when the event determining the amount of variable consideration to be paid occurs.

Additionally, the Company has elected the short-term lease exemption and, therefore, do not recognize a ROU asset or corresponding liability for lease arrangements with an original term of 12 months or less.

Operating leases are included in right of use operating assets, current lease liabilities, and noncurrent lease liabilities in the consolidated balance sheet as of December 31, 2022 and 2021.

Segment Reporting

The Company’s chief operating decision maker evaluates the business on a consolidated basis and therefore, the Company operates one operating and reportable segment.

v3.23.1
Recent Accounting Pronouncements
12 Months Ended
Dec. 31, 2022
Recent Accounting Pronouncements [Abstract]  
Recent Accounting Pronouncements NOTE 2:Recent Accounting Pronouncements

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU requires timelier recording of credit losses on loans and other financial instruments held. Instead of reserves based on a current probability analysis, Topic 326 requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. All organizations will now use forward-looking information to better inform their credit loss estimates. Topic 326 requires enhanced disclosures regarding significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. These disclosures include qualitative and quantitative requirements that provide information about the amounts recorded in the financial statements. In addition, Topic 326 amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. In April 2019, the FASB issued ASU No. 2019-04, Codification Improvements to Topic 326 Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments, to introduce amendments which will affect the recognition and measurement of financial instruments, including derivatives and hedging. In May 2019, the FASB issued ASU No. 2019-05, Financial Instruments – Credit Losses (Topic 326); Targeted Transition Relief. The amendments in this ASU provide entities that have certain instruments within the scope of Subtopic 326-20 with an option to irrevocably elect the fair value option in Subtopic 825-10, applied on an instrument-by-instrument basis for eligible instruments upon adoption of Topic 326. This standard and related amendments are effective for the Company’s fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The ASU is effective January 1, 2023 for smaller reporting companies, which includes the Company. The adoption of ASU 2016-13 is not expected to have a material impact on the Company’s results of operations, financial position, or cash flows.

In March 2020, FASB issued ASU No. 2020-03, Codification Improvements to Financial Instruments. This ASU improves and clarifies various financial instruments topics, including the current expected credit losses standard issued in 2016 (ASU No. 2016-13). The ASU includes seven different issues that describe the areas of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by eliminating inconsistencies and providing clarifications. The amendments have different effective dates. The issues 1-5 are conforming amendments, which are effective upon issuance of this final update. The Company determined that issues 1-5 have no impact on its financials. The amendments related to issue 6 and 7 effect ASU No. 2016-13, Financial instruments – credit losses (Topic 326): measurement of credit losses on financial statements. Effective dates of issue 6 and 7 are the same as the effective date of ASU No. 2016-13. The Company will adopt the new standard in the first quarter of fiscal year 2023. The Company does not expect adoption of this standard will have a material impact on the Company’s results of operations, financial position, or cash flows.

In August 2020, the Financial Accounting Standards Board issued Accounting Standard Update No. 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”). This update was issued to assist in simplifying the accounting for convertible instruments. This ASU 2020-06 is scheduled to be effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than

fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of this standard on its consolidated financial statements.

v3.23.1
Strategic Alliance With Quest Diagnostics Incorporated
12 Months Ended
Dec. 31, 2022
Strategic Alliance With Quest Diagnostics Incorporated [Abstract]  
Strategic Alliance With Quest Diagnostics Incorporated NOTE 3:Strategic Alliance with Quest Diagnostics Incorporated

In March 2015, the Company reached an agreement with Quest Diagnostics Incorporated (“Quest Diagnostics”). Pursuant to this agreement, all Ova1 U.S. testing services for Quest Diagnostics customers were transferred to Aspira’s wholly-owned subsidiary, Aspira Labs, as of August 2015. Pursuant to this agreement, as amended as of March 11, 2020, Quest Diagnostics has continued to provide blood draw and logistics support by transporting specimens to Aspira Labs for testing and is billed by Quest Diagnostics for services performed. The purpose of the 2020 amendment was to extend the term of the Testing and Services Agreement from March 11, 2019 to March 11, 2023 and for the Company to pay an annual fee of $75,000 for the services of a part-time Quest Diagnostics project manager. The parties are continuing to operate under the existing agreement. As of December 31, 2022, the Company has $296,850 accrued and payable to Quest Diagnostics for phlebotomy services rendered on behalf of the Company under the terms of the agreements.

v3.23.1
Property And Equipment
12 Months Ended
Dec. 31, 2022
Property And Equipment [Abstract]  
Property And Equipment Note 4: Property and Equipment

The components of property and equipment as of December 31, 2022 and 2021 were as follows:

December 31,

(in thousands)

2022

2021

Machinery and equipment

$

891

$

1,094

Demonstration equipment

-

8

Computer equipment and software

1,386

1,252

Furniture and fixtures

181

174

Leasehold improvements

721

721

Gross property and equipment

3,179

3,249

Accumulated depreciation and amortization

(2,811)

(2,785)

Property and equipment, net

$

368

$

464

Depreciation expense for property and equipment was $265,000 and $302,000 for the years ended December 31, 2022 and 2021, respectively.

As of December 31, 2022, property and equipment was reviewed for potential impairment for recoverability by comparing the carrying amount of certain of the Company’s assets to the estimated undiscounted future cash flows expected to be generated by the asset group. As the carrying amount of the Company’s asset group exceeded its estimated undiscounted future cash flows, the Company recognized an impairment of $52,000, recorded as selling, general and administrative expense on the consolidated statement of operations, based on the difference between the carrying value of the fixed assets and their fair value as of December 31, 2022 as a result of the Company’s discontinuance of the genetics testing offering effective September 30, 2022. The fair value was derived from an offer to purchase certain of the Company’s assets for a blanket amount, as the Company’s management believes it represents the most appropriate fair value of the asset group.
v3.23.1
Accrued Liabilities
12 Months Ended
Dec. 31, 2022
Accrued Liabilities [Abstract]  
Accrued Liabilities NOTE 5:Accrued Liabilities

The components of accrued liabilities as of December 31, 2022 and 2021 were as follows:

December 31,

(in thousands)

2022

2021

Payroll and benefits related expenses

$

2,051

$

2,652

Collaboration and research agreements expenses

404

382

Professional services

556

1,992

Other accrued liabilities

639

273

Total accrued liabilities

$

3,650

$

5,299

v3.23.1
Commitments, Contingencies And Debt
12 Months Ended
Dec. 31, 2022
Commitments, Contingencies And Debt [Abstract]  
Commitments, Contingencies And Debt NOTE 6:Commitments, Contingencies and debt

Long-term debt consisted of the following:

December 31,

December 31,

2022

2021

(in thousands)

DECD loan, net of issuance costs

$

2,718

$

2,919

Less: Current portion, net of issuance costs

(403)

(201)

Total long-term debt, net of issuance costs

$

2,315

$

2,718

Coronavirus Aid, Relief, and Economic Security (CARES) Act and Paycheck Protection Program Loan

On May 1, 2020, the Company obtained the PPP Loan from BBVA USA in the aggregate amount of approximately $1,006,000. The application for these funds required the Company to, in good faith, certify that the described economic uncertainty at the time made the loan request necessary to support the ongoing operations of the Company. This certification further required the Company to consider its current business activity and its ability to access other sources of liquidity sufficient to support ongoing operations in a manner that was not significantly detrimental to the business. Under the terms of the CARES Act and the PPP, all or a portion of the principal amount of the PPP Loan was subject to forgiveness so long as, over the 24-week period following the Company’s receipt of the proceeds of the PPP Loan, the Company used those proceeds for payroll costs, rent, utility costs or the maintenance of employee and compensation levels. The PPP Loan, which was granted pursuant to a promissory note, was set to mature on May 1, 2022. The Company applied for forgiveness of the PPP Loan in March 2021, and, effective May 27, 2021, the SBA confirmed the waiver of the Company’s repayment of the PPP Loan. The Company recognized a gain on forgiveness of debt of approximately $1,006,000, which is included in other income in the consolidated statements of operations and reduced long- and short-term indebtedness by the same amount. The Company remains subject to an audit of the PPP Loan. There is no assurance that the Company will not be required to repay all or a portion of the PPP Loan as a result of the audit.

Loan Agreement

On March 22, 2016, the Company entered into a loan agreement (as amended, the “DECD Loan Agreement”) with the DECD, pursuant to which the Company may borrow up to $4,000,000 from the DECD. The loan bears interest at a fixed rate of 2.0% per annum and requires equal monthly payments of principal and interest until maturity, which occurs on April 15, 2026. As security for the loan, the Company has granted the DECD a blanket security interest in the Company’s personal and intellectual property. The DECD’s security interest in the Company’s intellectual property may be subordinated to a qualified institutional lender. 

The loan may be prepaid at any time without premium or penalty. An initial disbursement of $2,000,000 was made to the Company on April 15, 2016 under the DECD Loan Agreement. On December 3, 2020, the Company received a disbursement of the remaining $2,000,000 under the DECD Loan Agreement, as the Company had achieved the target employment milestone necessary to receive an additional $1,000,000 under the DECD Loan Agreement and the DECD determined to fund the remaining $1,000,000

under the DECD Loan Agreement after concluding that the required revenue target would likely have been achieved in the first quarter of 2020 in the absence of the impacts of COVID-19.

Under the terms of the DECD Loan Agreement, the Company may be eligible for forgiveness of up to $1,500,000 of the principal amount of the loan if the Company achieves certain job creation and retention milestones by December 31, 2022. The Company was able to achieve the 25 full-time employee milestone. However, the Company has not yet been legally released of the liability and the achievement of the milestone is subject to lender review and approval. If the Company was either unable to retain 25 full-time employees with a specified average annual salary for a consecutive two-year period or does not maintain the Company’s Connecticut operations through March 22, 2026, the DECD may require early repayment of a portion or all of the loan plus a penalty of 5% of the total funded loan.

As of December 31, 2022, the annual amounts of future minimum principal payments due under the Company’s contractual obligation are shown in the table below. Unamortized debt issuance costs for the DECD loan were $12,000. Debt related to the insurance promissory note of $764,000, as described below, is not included in the following table due to the insurance promissory note being cancelable.

Payments Due by Period

(in thousands)

Total

2023

2024

2025

2026

2027

Thereafter

DECD Loan

$

2,729

$

406

$

452

$

461

$

341

$

254

$

815

Total

$

2,729

$

406

$

452

$

461

$

341

$

254

$

815

Insurance Notes

During 2022 and 2021, the Company entered into insurance promissory notes for the payment of insurance premiums at an interest rate of 5.48% and 3.74% respectively, with an aggregate principal amount outstanding of approximately $764,000 and $779,000 as of December 31, 2022 and 2021, respectively. The amount outstanding in 2022 could be substantially offset by the cancellation of the related insurance coverage which is classified in prepaid insurance. These notes are payable in ten monthly installments with maturity dates of October 1, 2023 and October 1, 2022, respectively.

Operating Leases

The Company leases facilities to support its business of discovering, developing and commercializing diagnostic tests in the fields of gynecologic disease. The Company’s principal facility, including the CLIA laboratory used by Aspira Labs, is located in Austin, Texas, and the CLIA laboratory used for research and development services is located in Trumbull, Connecticut. In December 2022, the Company renewed the Austin, Texas lease for one additional year. The Company’s renewed lease expires on January 31, 2024, with no automatic renewal or renewal option. The Company’s Texas lease has a term of 12 months, and the Company has elected the policy of not recording leases on the balance sheet when the leases have terms of 12 months or less. The Company recognized the lease payments in profit and loss on a straight-line basis over the term of the lease, and variable lease payments in the period in which the obligation for the payments was incurred. Variable lease costs represent our share of the landlord’s operating expenses.

In October 2015, the Company entered into a lease agreement for a facility in Trumbull, Connecticut. The lease required initial payments for the buildout of leasehold improvements to the office space, which were approximately $596,000. In September 2020, the Company exercised the renewal option for its Trumbull, Connecticut lease. The Company’s renewed lease expires on June 30, 2026, with a five year renewal option. The Company is not reasonably certain that it will exercise the five-year renewal option beginning on July 1, 2026.

The expense associated with these operating leases for the years ended December 31, 2022 and 2021 is shown in the table below (in thousands). Included in the amounts below are $114,000 and $54,000 related to rent and variable costs, respectively, for the Texas lease during 2022 and $108,000 and $53,000 related to rent and variable costs, respectively during 2021.



Year Ended December 31,

Lease Cost

Classification

2022

2021

Operating rent expense

Cost of revenue

$

79

$

59

Research and development

27

44

Sales and marketing

37

33

General and administrative

66

68

Variable rent expense

Cost of revenue

$

39

$

32

Research and development

22

32

Sales and marketing

34

37

General and administrative

67

61

Based on the Company’s leases as of December 31, 2022, the table below sets forth the approximate future lease payments related to operating leases with initial terms of one year or more (in thousands).

2023

$

106

2024

116

2025

123

2026

64

Total Operating Lease Payments

409

Less: Imputed Interest

(60)

Present Value of Lease Liabilities

349

Less: Operating Lease Liability, current portion

(77)

Operating Lease Liability, non-current portion

$

272

Supplemental disclosure of cash flow information related to leases for the years ended December 31, 2022 and 2021 is shown in the table below (in thousands).

Year Ended December 31,

2022

2021

Cash paid for amounts included in measurement of lease liabilities:

Operating cash outflows relating to operating leases

$

371

$

366

Weighted-average remaining lease term (in years)

3.5

4.5

Weighted-average discount rate

9.30%

9.33%

Non-cancelable Royalty Obligations and Other Commitments

The Company is a party to an amended research collaboration agreement with The Johns Hopkins University School of Medicine under which the Company licenses certain of its intellectual property directed at the discovery and validation of biomarkers in human subjects, including but not limited to clinical application of biomarkers in the understanding, diagnosis and management of human disease. Under the terms of the amended research collaboration agreement, Aspira is required to pay the greater of 4% royalties on net sales of diagnostic tests using the assigned patents or annual minimum royalties of $57,500. Royalty expense for the years ended December 31, 2022 and 2021 totaled $318,000 and $263,000, respectively, as recorded in cost of revenue in the consolidated statements of operations.

Commercial Reorganization

During the first quarter of 2022, the Company executed a commercial reorganization resulting in the separation of a number of employees. The organizational changes resulted in the recording within the consolidated statement of operations in sales and marketing, research and development and general and administrative expenses of one-time severance, separation, and settlement charges of approximately $1,284,000. These amounts have been partially offset by insurance reimbursement of $523,000. All charges have been settled as of December 31, 2022.

Contingent Liabilities

From time to time, the Company is involved in legal proceedings and regulatory proceedings arising from operations. The Company establishes reserves for specific liabilities in connection with legal actions that management deems to be probable and estimable. The Company is not currently a party to any proceeding, the adverse outcome of which would have a material adverse effect on the Company’s financial position or results of operations.

In August 2022, the Company entered into a sponsored research agreement with Harvard’s Dana-Farber Cancer Institute, Brigham & Women’s Hospital, and Medical University of Lodz for the generation of a multi-omic, non-invasive diagnostic aid to identify endometriosis based on circulating miRNAs and proteins. The results of this collaboration will be advanced, co-developed technology to guide medical and clinical management of women presenting with symptoms of endometriosis. This collaboration is expected to accelerate the development and commercialization of future endometriosis products, such as EndoCheck. The contract requires payments to be made upon the achievement of certain milestones. Under the terms of and as further described in the agreement, payments of approximately $1,252,000 have or will become due from the Company to the counterparties upon successful completion of certain deliverables in 2022 and 2023 as follows: 68% was paid in August 2022, 15% will become payable upon completion of certain deliverables estimated to occur in the first quarter of 2023, and 17% will become payable upon completion of certain deliverables estimated to occur in the second quarter of 2023. For the year ended December 31, 2022, the Company made payments totaling $852,000, all of which were deemed earned by the collaboration partners and are included in research and development expense. Additional payments of $400,000 are due to the collaboration partners in 2023 under the terms of the agreement.

v3.23.1
Common Stock
12 Months Ended
Dec. 31, 2022
Equity [Abstract]  
Common Stock

NOTE 7:Common Stock

2021 Public Offering

On February 4, 2021, the Company entered into an underwriting agreement (the “2021 Underwriting Agreement”) with William Blair & Company, L.L.C. and Truist Securities, Inc., as representatives of several underwriters (the “2021 Underwriters”), in connection with the underwritten public offering of 6,000,000 shares of Aspira common stock at a price to the public of $7.50 per share. The 2021 Underwriters purchased these 6,000,000 shares at the public offering price per share, less the underwriting discount of $0.4875 per share.

Under the 2021 Underwriting Agreement, the Company granted the 2021 Underwriters an option to purchase up to an additional 900,000 shares of Aspira common stock at the public offering price, less the underwriting discount of $0.4875 per share. On February 5, 2021, the 2021 Underwriters notified the Company that they were exercising this option in connection with the closing of the 2021 Offering. The 2021 Offering, including the additional 900,000 shares of Aspira common stock, closed on February 8, 2021 and resulted in net proceeds to the Company of approximately $47,858,000, after deducting underwriting discounts and offering expenses of $377,000.

2022 Public Offering

On August 22, 2022, the Company entered into an underwriting agreement (the “2022 Underwriting Agreement”) with William Blair & Company, L.L.C., as the sole underwriter (the “2022 Underwriter”). Pursuant to the 2022 Underwriting Agreement, the Company agreed to issue and sell, in an underwritten public offering (the “2022 Offering”), 12,000,000 shares of the Company’s common stock, par value $0.001 per share (“Common Stock”) and warrants to purchase up to 12,000,000 shares of Common Stock (the “Warrants”). Each share of Common Stock was sold together with one Warrant to purchase one share of Common Stock, at a price to the public of $0.75 per share and related Warrant.

The Warrants were issued pursuant to a common stock purchase warrant (the “Form of Warrant”). Each Warrant has an initial exercise price equal to $0.88 per share of Common Stock and are exercisable for five years from the date of issuance. The exercise price and the number of shares of Common Stock issuable upon exercise of the Warrants are subject to adjustment in the event of certain subdivisions and combinations, including by any stock split or reverse stock split, stock dividend, recapitalization or otherwise. The exercise of the Warrants may be limited in certain circumstances if, after giving effect to such exercise, the holder or any of its affiliates would beneficially own (as determined in accordance with the terms of the Warrants) more than 4.99% (or, at the election of the holder, 9.99%) of the outstanding Common Stock immediately after giving effect to the exercise. There is no established trading market available for the Warrants on any securities exchange or nationally recognized trading system.

The Company accounts for common stock warrants as either equity-classified or liability-classified instruments based on an assessment of the specific terms of the warrants and applicable authoritative guidance in Financial Accounting Standards Board Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815-40, Contracts in Entity’s Own Equity (“ASC 815-40”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and meet all of the requirements for equity classification under ASC 815-40, including whether the warrants are indexed to the Company’s own stock and whether the events where holders of the warrants could potentially require net cash settlement are within the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. As further described in the Form of Warrant, if the Company consummates any merger, consolidation, sale or other reorganization event, including the sale of all or substantially all of the Company’s assets, in which its common stock is converted into or exchanged for securities, cash or other property (“Fundamental Transaction”), then the Company shall pay at the holder’s option, exercisable at any time commencing on the occurrence or the consummation of the Fundamental Transaction (or, if later, the date of public announcement) and continuing up to 30 days, an amount of cash equal to the value of the remaining unexercised portion of the Warrant as determined in accordance with the Black-Scholes option pricing model on the date of such Fundamental Transaction provided; however, that if the Fundamental Transaction is not within the Company’s control, including not approved by the Board of Directors, the holder of the Warrant shall only be entitled to receive the same type or form of consideration (and in the same proportion), at the Black Scholes Value of the unexercised portion of the Warrant, that is being offered and paid to the holder of the Common Stock of the Company in connection with the Fundamental Transaction. The Black-Scholes option pricing model, as defined in the Form of Warrant, includes as an input, the highest volume weighted average price (“VWAP”) for a period of one trading day preceding the consummation or announcement of a Fundamental Transaction up to 30 days after a Fundamental Transaction. The Company has determined that an adjustment based on this input is not limited to the effect that is attributable to the Fundamental Transaction and therefore causes the Warrants to fail the indexation guidance under ASC 815-40. As a result, the Company has determined that the Warrants must be recorded as derivative liabilities upon issuance and marked to market each reporting period in the Company’s consolidated statement of operations until their exercise or expiration.

The fair values of the Warrants as of August 22, 2022, the issuance date, and December 31, 2022 were $7,752,000 and $2,280,000, respectively. The fair value of the Warrants was estimated using Black-Scholes pricing model based on the following assumptions:

December 31, 2022

August 22, 2022

Dividend yield

-

%

-

%

Volatility

96.8

%

95.0

%

Risk-free interest rate

3.99

%

3.17

%

Expected lives (years)

4.64

5.00

Weighted average fair value

$

0.190

$

0.646

The fair value of the Warrants was deemed to be derivative instruments due to certain contingent put feature, was determined using the Black-Scholes option pricing model, deemed to be an appropriate model due to the terms of the Warrants issued, including a fixed term and exercise price.

 

The fair value of Warrants was affected by changes in inputs to the Black-Scholes option pricing model including the Company’s stock price, expected stock price volatility, the contractual term, and the risk-free interest rate. This model uses Level 2 inputs, including stock price volatility, in the fair value hierarchy established by ASC 820 Fair Value Measurement. At December 31, 2022, the fair value of all Warrants was $2,280,000, which are classified as a long-term Warrant liability on the Company’s balance sheet.

The 2022 Offering resulted in net proceeds to the Company of approximately $7,675,000, after deducting underwriting discounts and offering expenses of $1,325,000. Offering costs were allocated between liability expense and equity based on the fair value of the Warrants of $7,752,000 and the total gross proceeds of $9,000,000. $1,117,000 of offering costs were allocated to the Warrants and were expensed immediately and recorded as selling, general and administrative expense in the consolidated statement of operations for the year ended December 31, 2022, resulting in a net impact to the Company’s equity of $208,000.

Warrants

Warrants outstanding as of December 31, 2022 and 2021 were as follows:

Exercise Price

Number of Shares Outstanding under Warrant

Issuance Date

Expiration Date

per Share

December 31, 2022

December 31, 2021

August 25, 2022

August 25, 2027

$             0.88

12,000,000

-

12,000,000

-

v3.23.1
Loss Per Share
12 Months Ended
Dec. 31, 2022
Loss Per Share [Abstract]  
Loss Per Share NOTE 8: Loss Per Share

The reconciliation of the numerators and denominators of basic and diluted loss per share for the years ended December 31, 2022 and 2021 was as follows:

Loss

Shares

Per Share

(In thousands, except shares and per share data)

(Numerator)

(Denominator)

Amount

Year ended December 31, 2022:

Net loss - basic

$

(27,170)

116,536,631

$

(0.23)

Dilutive effect of common stock shares issuable upon exercise of stock options

-

-

Net loss - diluted

$

(27,170)

116,536,631

$

(0.23)

Year ended December 31, 2021:

Net loss - basic

$

(31,662)

111,210,614

$

(0.28)

Dilutive effect of common stock shares issuable upon exercise of stock options

-

-

Net loss - diluted

$

(31,662)

111,210,614

$

(0.28)

Due to net losses for the years ended December 31, 2022 and 2021, diluted loss per share is calculated using the weighted average number of common shares outstanding and excludes the effects of potential shares of common stock that are antidilutive.

The potential shares of common stock that have been excluded from the diluted loss per share calculation above for the years ended December 31, 2022 and 2021 were as follows:

Year Ended December 31,

2022

2021

Stock options

9,828,424

10,257,908

Warrants

12,000,000

-

Potential common shares

21,828,424

10,257,908

v3.23.1
Employee Share Based Compensation And Benefit Plans
12 Months Ended
Dec. 31, 2022
Employee Share Based Compensation And Benefit Plans [Abstract]  
Employee Share Based Compensation And Benefit Plans NOTE 9:Employee SHARE BASED COMPENSATION AND Benefit Plans

2010 Stock Incentive Plan

The Company’s employees, directors, and consultants were eligible to receive awards under the Vermillion, Inc. Second Amended and Restated 2010 Stock Incentive Plan, which was replaced by the 2019 Plan (as defined below) with respect to future equity grants. As of December 31, 2022, there were no shares of Aspira common stock available for future grants under the 2010 Plan.

As of December 31, 2022, a total of 4,306,561 shares of Aspira common stock were reserved for issuance with respect to outstanding stock options.

2019 Stock Incentive Plan

At the Company’s 2019 annual meeting of stockholders, the Company’s stockholders approved the Vermillion, Inc. 2019 Stock Incentive Plan, which was later amended to the Aspira Women’s Health Inc. (the “2019 Plan”). The purposes of the 2019 Plan are (i) to align the interests of the Company’s stockholders and recipients of awards under the 2019 Plan by increasing the proprietary interest of such recipients in the Company’s growth and success; (ii) to advance the interests of the Company by attracting and retaining non-employee directors, officers, other employees, consultants, independent contractors and agents; and (iii) to motivate such persons to act in the long-term best interests of the Company and its stockholders. The 2019 Plan allows the Company to grant stock options, stock appreciation rights, restricted stock, restricted stock units and performance awards to participants.

Subject to the terms and conditions of the 2019 Plan, the initial number of shares authorized for grants under the 2019 Plan is 10,492,283. To the extent an equity award granted under the 2019 Plan expires or otherwise terminates without having been exercised or paid in full, or is settled in cash, the shares of common stock subject to such award will become available for future grant under the 2019 Plan. As of December 31, 2022, there were 3,576,486 shares of Aspira common stock available for future grants under the 2019 Plan.

As of December 31, 2022, there were 5,521,863 shares of Aspira common stock subject to outstanding stock options and there were no outstanding restricted stock units.

The activity related to shares available for grant under the 2010 Plan and the 2019 Plan for the years ended December 31, 2022 and 2021 was as follows:

2010 Stock Option Plan

2019 Stock Option Plan

Total