PART I [Business](index=5&type=section&id=ITEM%201%3A%20BUSINESS) Ideal Power develops and commercializes B-TRAN™ solid-state switch technology, targeting electric vehicles, renewable energy, and data centers, funded by stock sales and grants - The company is solely focused on the development and commercialization of its **B-TRAN™ solid-state switch technology**[16](index=16&type=chunk) - In January 2023, the company launched its first commercial product, the **SymCool™ Power Module**, targeting the solid-state circuit breaker (SSCB) market[18](index=18&type=chunk) - A product development agreement was initiated in Q4 2022 with a top-10 global automaker for a custom B-TRAN™ power module for next-generation EV platforms[19](index=19&type=chunk) - The **B-TRAN™ technology** is expected to reduce power losses by **50% or more** compared to conventional power switches, enabling higher efficiency[34](index=34&type=chunk) - As of December 31, 2022, the company holds a significant intellectual property portfolio with **41 U.S. and 31 foreign issued patents** related to its B-TRAN™ technology[40](index=40&type=chunk) Grant Revenue (2021-2022) | Year | Grant Revenue ($) | | :--- | :--- | | 2022 | $203,269 | | 2021 | $576,399 | [Risk Factors](index=12&type=section&id=ITEM%201A%3A%20RISK%20FACTORS) The company faces significant risks from historical losses, reliance on external financing, new product development uncertainties, supply chain dependencies, and market competition - The company has sustained approximately **$87.1 million in net losses since inception**, with a **net loss of $7.2 million in 2022**, and may not achieve profitability[51](index=51&type=chunk) - Product development is inherently uncertain, with no guarantee that B-TRAN™ products will meet prototype results or customer expectations[53](index=53&type=chunk) - Dependence on semiconductor fabrication partners poses risks related to two-sided wafer processing, cost-effectiveness at scale, and securing capacity[55](index=55&type=chunk)[56](index=56&type=chunk) - Achieving 'design wins' is critical but challenging as a new market entrant, with potentially long sales cycles, especially in automotive[57](index=57&type=chunk)[61](index=61&type=chunk) - Additional financing may be required, which might not be available on acceptable terms and could result in dilution for existing stockholders[77](index=77&type=chunk)[96](index=96&type=chunk) - Supply chain disruptions, including COVID-19 impacts, logistics, and component shortages, could interrupt manufacturing, delay development, and increase costs[70](index=70&type=chunk)[73](index=73&type=chunk) [Unresolved Staff Comments](index=29&type=section&id=ITEM%201B%3A%20UNRESOLVED%20STAFF%20COMMENTS) The company reports no unresolved staff comments from the SEC - None[102](index=102&type=chunk) [Properties](index=29&type=section&id=ITEM%202%3A%20PROPERTIES) Ideal Power leases 4,070 square feet of office and laboratory space in Austin, Texas, with a remaining lease term of 44 months as of December 31, 2022 - The company leases **4,070 square feet** of office and laboratory space in Austin, Texas[103](index=103&type=chunk) - The lease commenced on June 1, 2021, with a remaining term of **44 months** as of December 31, 2022[103](index=103&type=chunk) [Legal Proceedings](index=29&type=section&id=ITEM%203%3A%20LEGAL%20PROCEEDINGS) The company is not currently involved in any legal proceedings expected to have a material adverse impact on its business or financial results - The company is not currently a party to any legal proceedings expected to have a material adverse impact on its business[104](index=104&type=chunk) [Mine Safety Disclosures](index=30&type=section&id=ITEM%204%3A%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company - Not applicable[105](index=105&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=30&type=section&id=ITEM%205%3A%20MARKET%20FOR%20REGISTRANT%27S%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) The company's common stock trades on Nasdaq under "IPWR", with no cash dividends paid or anticipated, as earnings are reinvested for business expansion - The company's common stock is listed on the Nasdaq Capital Market under the symbol **"IPWR"**[106](index=106&type=chunk) - No cash dividends have been paid since inception, with plans to retain earnings for business expansion rather than future payouts[107](index=107&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=ITEM%207%3A%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Grant revenue decreased in 2022, while operating expenses significantly increased, leading to a 51% higher net loss of $7.2 million, with $16.3 million in cash deemed sufficient for the next 12 months Comparison of Operations (2022 vs. 2021) | Metric | 2022 ($) | 2021 ($) | Change (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Grant Revenue | $203,269 | $576,399 | -64.7% | Timing of milestones under NAVSEA program | | R&D Expenses | $3,366,776 | $1,927,743 | +75% | Higher self-funded wafer fabrication runs and personnel costs | | G&A Expenses | $3,123,852 | $2,408,425 | +30% | Higher stock-based compensation and professional fees | | Sales & Marketing | $852,331 | $512,807 | +66% | Higher personnel costs and activities to support commercialization | | Loss from Operations | ($7,342,959) | ($4,848,975) | +51% | Driven by lower revenue and higher operating expenses | | Net Loss | ($7,189,350) | ($4,770,269) | +51% | Driven by higher operating loss | - The company expects to generate initial commercial revenue in **late 2023** following product launch and a new development agreement[126](index=126&type=chunk) - As of December 31, 2022, cash and cash equivalents totaled **$16.3 million**, deemed sufficient for liquidity needs for at least the next 12 months[135](index=135&type=chunk)[136](index=136&type=chunk) - Net cash used in operating activities increased to **$6.4 million in 2022** from **$4.3 million in 2021**, reflecting higher net loss and working capital changes[137](index=137&type=chunk)[138](index=138&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=ITEM%207A%3A%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) As a smaller reporting company, Ideal Power is not required to provide quantitative and qualitative disclosures about market risk - Not required for a smaller reporting company[149](index=149&type=chunk) [Financial Statements and Supplementary Data](index=38&type=section&id=ITEM%208%3A%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA) This section presents audited financial statements for 2022 and 2021, showing a net loss of $7.2 million in 2022, with total assets of $19.4 million and net cash usage of $6.8 million Balance Sheet Summary (as of Dec 31, 2022) | Category | Amount ($) | | :--- | :--- | | **Assets** | | | Cash and cash equivalents | $16,345,623 | | Total current assets | $16,902,924 | | Total assets | $19,399,367 | | **Liabilities & Equity** | | | Total current liabilities | $449,318 | | Total liabilities | $1,490,763 | | Total stockholders' equity | $17,908,604 | Statement of Operations Summary (Year ended Dec 31, 2022) | Metric | Amount ($) | | :--- | :--- | | Grant revenue | $203,269 | | Total operating expenses | $7,342,959 | | Loss from operations | $(7,342,959) | | Net loss | $(7,189,350) | | Net loss per share | $(1.17) | Statement of Cash Flows Summary (Year ended Dec 31, 2022) | Category | Amount ($) | | :--- | :--- | | Net cash used in operating activities | $(6,383,914) | | Net cash used in investing activities | $(312,740) | | Net cash used in financing activities | $(127,872) | | Net decrease in cash | $(6,824,526) | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=58&type=section&id=ITEM%209%3A%20CHANGES%20IN%20AND%20DISAGREEMENTS%20WITH%20ACCOUNTANTS%20ON%20ACCOUNTING%20AND%20FINANCIAL%20DISCLOSURE) This item is not applicable to the company - Not applicable[237](index=237&type=chunk) [Controls and Procedures](index=58&type=section&id=ITEM%209A%3A%20CONTROLS%20AND%20PROCEDURES) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2022, with no material changes during Q4 2022 - Management, including the CEO and CFO, concluded that disclosure controls and procedures were **effective** as of December 31, 2022[239](index=239&type=chunk) - Internal control over financial reporting was concluded to be **effective** as of December 31, 2022, based on the COSO framework[240](index=240&type=chunk) - No material changes in internal control over financial reporting occurred during the fourth quarter of 2022[242](index=242&type=chunk) [Other Information](index=60&type=section&id=ITEM%209B%3A%20OTHER%20INFORMATION) This item is not applicable to the company - Not applicable[244](index=244&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=60&type=section&id=ITEM%209C%3A%20DISCLOSURE%20REGARDING%20FOREIGN%20JURISDICTIONS%20THAT%20PREVENT%20INSPECTIONS) The company reports no information under this item - None[245](index=245&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=62&type=section&id=ITEM%2010%3A%20DIRECTORS%2C%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE) Information for this item is incorporated by reference from the company's definitive proxy statement for the 2023 annual meeting of stockholders - Information is incorporated by reference from the registrant's definitive proxy statement for the **2023 annual meeting of stockholders**[246](index=246&type=chunk) [Executive Compensation](index=62&type=section&id=ITEM%2011%3A%20EXECUTIVE%20COMPENSATION) Information for this item is incorporated by reference from the company's definitive proxy statement for the 2023 annual meeting of stockholders - Information is incorporated by reference from the registrant's definitive proxy statement for the **2023 annual meeting of stockholders**[247](index=247&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=62&type=section&id=ITEM%2012%3A%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT%20AND%20RELATED%20STOCKHOLDER%20MATTERS) Information for this item is incorporated by reference from the company's definitive proxy statement for the 2023 annual meeting of stockholders - Information is incorporated by reference from the registrant's definitive proxy statement for the **2023 annual meeting of stockholders**[248](index=248&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=62&type=section&id=ITEM%2013%3A%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20TRANSACTIONS%2C%20AND%20DIRECTOR%20INDEPENDENCE) Information for this item is incorporated by reference from the company's definitive proxy statement for the 2023 annual meeting of stockholders - Information is incorporated by reference from the registrant's definitive proxy statement for the **2023 annual meeting of stockholders**[249](index=249&type=chunk) [Principal Accountant Fees and Services](index=62&type=section&id=ITEM%2014%3A%20PRINCIPAL%20ACCOUNTANT%20FEES%20AND%20SERVICES) Information for this item is incorporated by reference from the company's definitive proxy statement for the 2023 annual meeting of stockholders - Information is incorporated by reference from the registrant's definitive proxy statement for the **2023 annual meeting of stockholders**[250](index=250&type=chunk) PART IV [Exhibits, Financial Statement Schedules](index=63&type=section&id=ITEM%2015%3A%20EXHIBITS%2C%20FINANCIAL%20STATEMENT%20SCHEDULES) This section lists financial statements, schedules, and exhibits filed with the Annual Report on Form 10-K, with schedules omitted if not required or applicable - This section lists the financial statements and exhibits filed with the report[251](index=251&type=chunk)[254](index=254&type=chunk) - All financial statement schedules were omitted as not required, not applicable, or already included in financial statements or notes[253](index=253&type=chunk) [Form 10-K Summary](index=66&type=section&id=ITEM%2016%3A%20FORM%2010-K%20SUMMARY) The company did not provide a summary for its Form 10-K - None[259](index=259&type=chunk)

Call Start: 16:30 January 1, 0000 5:10 PM ET Ideal Power Inc. (NASDAQ:IPWR) Q4 2022 Earnings Conference Call March 2, 2023 16:30 ET Company Participants Jeff Christensen - Investor Relations Dan Brdar - President & Chief Executive Officer Tim Burns - Chief Financial Officer Conference Call Participants David Williams - The Benchmark Company Operator Good day ladies and gentlemen and welcome to the Ideal Power Fourth Quarter and Full Year 2022 Results Call. At this time, all participants are in listen-only m ...

Ideal Power Inc. (NASDAQ:IPWR) Q3 2022 Earnings Conference Call November 14, 2022 4:30 PM ET Company Participants Carolyn Capaccio - LHA Dan Brdar - President & Chief Executive Officer Tim Burns - Chief Financial Officer Conference Call Participants Operator Good day and welcome to the Ideal Power Third Quarter 2022 Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Carolyn Capaccio of LHA. Please go ahead. Carolyn Capaccio Thank you, ope ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to _______________ Commission File Number 001-36216 IDEAL POWER INC. (Exact name of registrant as specified in its charte ...

Investor Presentation August 2022 Safe Harbor All statements in this presentation that are not based on historical fact are "forward looking statements." While management has based any forward looking statements included in this presentation on its current expectations, the information on which such expectations were based may change. These forward looking statements rely on a number of assumptions concerning future events and are subject to a number of risks, uncertainties and other factors, many of which ...

Ideal Power Inc. (NASDAQ:IPWR) Q2 2022 Earnings Conference Call August 15, 2022 4:30 PM ET Company Participants Carolyn Capaccio - LHA Investor Relations SVP Dan Brdar - CEO President and Director Tim Burns - CFO, Secretary and Treasurer Conference Call Participants David Williams - Benchmark Orin Hirschman - AIGH Investment Partners Don Slowinski - Winslow Asset Group Taylor Fredericks - Arrowhead Peter Sidoti - Sidoti & Company Robert Ainbinder - GoldStreet Operator Welcome to the Ideal Power Second Quart ...

[PART I - FINANCIAL INFORMATION](index=4&type=section&id=PART%20I) This part presents the company's unaudited financial statements, management's analysis, and disclosures on controls and procedures [Item 1. Unaudited Condensed Financial Statements](index=4&type=section&id=Item%201.%20Unaudited%20Condensed%20Financial%20Statements) This section presents the unaudited condensed financial statements, providing a snapshot of the company's financial position and performance [Balance Sheets](index=4&type=section&id=Balance%20Sheets) The company's financial position shows a decrease in total assets, primarily driven by a reduction in cash and cash equivalents - The company's total assets decreased from **$25.88 million** at December 31, 2021, to **$22.81 million** at June 30, 2022, primarily due to a reduction in cash and cash equivalents[10](index=10&type=chunk) Key Balance Sheet Figures | Metric | June 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | Cash and cash equivalents | $20,020,712 | $23,170,149 | | Total current assets | $20,429,823 | $23,447,311 | | Total assets | $22,810,077 | $25,877,480 | | Total current liabilities | $578,476 | $542,871 | | Total liabilities | $1,692,449 | $1,727,555 | | Total stockholders' equity | $21,117,628 | $24,149,925 | [Statements of Operations](index=5&type=section&id=Statements%20of%20Operations) The company reported widening net losses for the three and six-month periods due to increased operating expenses - Ideal Power Inc. reported **increased net losses** for both the three and six months ended June 30, 2022, compared to the same periods in 2021, driven by higher operating expenses and decreased other income[12](index=12&type=chunk) Key Statements of Operations Figures | Metric | Three Months Ended June 30, 2022 | Three Months Ended June 30, 2021 | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Grant revenue | $50,978 | $84,705 | $175,986 | $326,766 | | Gross profit | $— | $— | $— | $— | | Total operating expenses | $1,696,172 | $1,276,244 | $3,597,097 | $2,200,388 | | Loss from operations | $(1,696,172) | $(1,276,244) | $(3,597,097) | $(2,200,388) | | Total other income | $6,178 | $89,551 | $2,462 | $89,545 | | Net loss | $(1,689,994) | $(1,186,693) | $(3,594,635) | $(2,110,843) | | Net loss per share – basic and diluted | $(0.27) | $(0.19) | $(0.58) | $(0.37) | [Statements of Cash Flows](index=6&type=section&id=Statements%20of%20Cash%20Flows) Net cash used in operations increased significantly, reflecting a higher net loss and changes in working capital - Cash used in operating activities **significantly increased** for the six months ended June 30, 2022, primarily due to a higher net loss and unfavorable changes in working capital, contrasting with the prior year's cash inflows from financing activities[15](index=15&type=chunk) Key Statements of Cash Flows Figures (Six Months Ended June 30) | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Net loss | $(3,594,635) | $(2,110,843) | | Net cash used in operating activities | $(3,081,517) | $(1,801,095) | | Net cash used in investing activities | $(67,920) | $(145,019) | | Net cash provided by financing activities | $— | $24,505,835 | | Net increase (decrease) in cash and cash equivalents | $(3,149,437) | $22,559,721 | | Cash and cash equivalents at end of period | $20,020,712 | $25,716,977 | [Statements of Stockholders' Equity](index=7&type=section&id=Statements%20of%20Stockholders'%20Equity) Stockholders' equity declined due to the net loss incurred, partially offset by stock-based compensation - Stockholders' equity decreased from **$24.15 million** at December 31, 2021, to **$21.12 million** at June 30, 2022, primarily due to the net loss incurred during the period, partially offset by stock-based compensation and stock issued for services[17](index=17&type=chunk) - During the six months ended June 30, 2022, the company recognized **$231,765 in stock-based compensation** for the three months ended March 31, 2022, and **$230,473** for the three months ended June 30, 2022, and issued **$100,100 in stock for services**[17](index=17&type=chunk) Key Stockholders' Equity Figures | Metric | December 31, 2021 | June 30, 2022 | | :--- | :--- | :--- | | Common Stock (Amount) | $5,894 | $5,905 | | Additional Paid-In Capital | $104,063,321 | $104,625,648 | | Accumulated Deficit | $(79,906,080) | $(83,500,715) | | Total Stockholders' Equity | $24,149,925 | $21,117,628 | [Notes to Financial Statements](index=8&type=section&id=Notes%20to%20Financial%20Statements) The notes detail the company's focus on B-TRAN™ technology, intangible assets, leases, and equity-related transactions - Ideal Power Inc. is focused on the development and commercialization of its **Bidirectional bipolar junction TRANsistor (B-TRAN™)** solid-state switch technology, having financed operations primarily through stock and warrant sales[20](index=20&type=chunk)[21](index=21&type=chunk) - Intangible assets, primarily patents, increased to **$1,189,513** at June 30, 2022, from $1,133,841 at December 31, 2021, with amortization expense of $73,910 for the six months ended June 30, 2022[27](index=27&type=chunk) - The **$91,407 PPP Loan**, including accrued interest, was fully forgiven by the SBA in May 2021, recognized as a non-cash gain in the prior year[29](index=29&type=chunk) - The company entered a new **63-month lease** for office and laboratory space in Austin, Texas, commencing June 1, 2021, with total future minimum payments of $336,454[31](index=31&type=chunk)[33](index=33&type=chunk) - The company has licensing agreements expiring in February 2033, with ongoing variable payments up to a maximum of **$100,000 per year** for five issued patents, resulting in an estimated present value of future payments of $877,778 at June 30, 2022[35](index=35&type=chunk)[36](index=36&type=chunk) - In January 2022, **10,000 unregistered shares** of common stock, valued at $100,100, were issued to a third-party vendor for services[41](index=41&type=chunk) - At June 30, 2022, **394,979 shares** were available for issuance under the 2013 Equity Incentive Plan; during the six months ended June 30, 2022, 41,062 stock options were granted, and **$1,539,738 of unrecognized compensation cost** related to non-vested equity awards remains[42](index=42&type=chunk)[43](index=43&type=chunk)[46](index=46&type=chunk) - As of June 30, 2022, there were **786,420 warrants outstanding** with a weighted average exercise price of $5.19, and 253,828 pre-funded warrants with an exercise price of $0.001[47](index=47&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=17&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes financial results, highlighting increased net losses due to higher operating expenses for B-TRAN™ commercialization - The company is solely focused on the further development and commercialization of its **Bidirectional bipolar junction TRANsistor (B-TRAN™)** solid-state switch technology[56](index=56&type=chunk) - Operations have been funded primarily through the sale of common stock and warrants, with total revenue from inception to June 30, 2022, amounting to **$16.1 million**, mostly from discontinued operations and grant revenue[57](index=57&type=chunk) - The COVID-19 pandemic has not had a material adverse impact on operations to date, but future disruptions, including electrical component shortages, fabrication capacity difficulties, and development delays, remain potential risks[59](index=59&type=chunk) - The company expects to introduce its initial product for commercial sale as early as **late 2022**[61](index=61&type=chunk) - No significant changes to critical accounting estimates or material changes from trends, events, or uncertainties disclosed in the 2021 Annual Report on Form 10-K were reported[83](index=83&type=chunk)[84](index=84&type=chunk) [Comparison of the three months ended June 30, 2022 to the three months ended June 30, 2021](index=18&type=section&id=Comparison%20of%20the%20three%20months%20ended%20June%2030%2C%202022%20to%20the%20three%20months%20ended%20June%2030%2C%202021) Q2 2022 results show a wider net loss driven by higher operating expenses and lower other income compared to Q2 2021 - The increase in Research and Development expenses was primarily due to higher semiconductor fabrication costs (**$115,061**) and wafer and driver component costs (**$95,212**), with almost all fabrication costs self-funded in 2022 compared to partial government funding in 2021[63](index=63&type=chunk) - Other income significantly decreased due to the absence of a **$91,407 gain on forgiveness of long-term debt** recognized in the prior year[66](index=66&type=chunk) - The company expects **higher research and development and sales and marketing expenses**, and flat to modestly lower general and administrative expenses in the remainder of 2022[63](index=63&type=chunk)[64](index=64&type=chunk)[65](index=65&type=chunk) Financial Performance (Three Months Ended June 30) | Metric | 2022 | 2021 | Change (YoY) | | :--- | :--- | :--- | :--- | | Grant Revenues | $50,978 | $84,705 | -39.8% | | Cost of Grant Revenues | $50,978 | $84,705 | -39.8% | | Research and Development Expenses | $728,383 | $560,693 | +30% | | General and Administrative Expenses | $734,637 | $603,518 | +22% | | Sales and Marketing Expenses | $233,152 | $112,033 | +108% | | Loss from Operations | $(1,696,172) | $(1,276,244) | +33% | | Other Income | $6,178 | $89,551 | -93.1% | | Net Loss | $(1,689,994) | $(1,186,693) | +42% | [Comparison of the six months ended June 30, 2022 to the six months ended June 30, 2021](index=20&type=section&id=Comparison%20of%20the%20six%20months%20ended%20June%2030%2C%202022%20to%20the%20six%20months%20ended%20June%2030%2C%202021) H1 2022 results indicate a significantly larger net loss due to increased R&D, G&A, and S&M expenses year-over-year - The significant increase in Research and Development expenses was primarily due to higher semiconductor fabrication costs (**$365,598**), stock-based compensation, and personnel costs, with almost all fabrication costs self-funded in 2022[71](index=71&type=chunk) - General and Administrative expenses increased due to higher investor relations spending, stock-based compensation, and Board search and placement fees[72](index=72&type=chunk) - Sales and Marketing expenses surged due to increased personnel costs from hiring the first two sales and marketing employees in 2021, along with higher stock-based compensation and travel costs[73](index=73&type=chunk) Financial Performance (Six Months Ended June 30) | Metric | 2022 | 2021 | Change (YoY) | | :--- | :--- | :--- | :--- | | Grant Revenues | $175,986 | $326,766 | -46.2% | | Cost of Grant Revenues | $175,986 | $326,766 | -46.2% | | Research and Development Expenses | $1,556,930 | $821,573 | +90% | | General and Administrative Expenses | $1,587,586 | $1,204,204 | +32% | | Sales and Marketing Expenses | $452,581 | $174,611 | +159% | | Loss from Operations | $(3,597,097) | $(2,200,388) | +63% | | Other Income | $2,462 | $89,545 | -97.2% | | Net Loss | $(3,594,635) | $(2,110,843) | +70% | [Liquidity and Capital Resources](index=20&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains sufficient liquidity for near-term operations but anticipates increased cash burn for B-TRAN™ commercialization - As of June 30, 2022, the company had cash and cash equivalents of **$20.0 million** and net working capital of **$19.9 million**, with no outstanding debt[77](index=77&type=chunk) - Management expects current cash to be **sufficient to fund activities for at least the next twelve months**, but additional funds may be required to fully implement the business strategy[77](index=77&type=chunk) - Net cash used in operating activities for the six months ended June 30, 2022, was **$3.08 million**, an increase from the prior year, and further increases are expected due to accelerated B-TRAN™ development and commercialization[78](index=78&type=chunk)[79](index=79&type=chunk) - Investing activities resulted in **$67,920 in cash outflows** for H1 2022, with an anticipated increase in H2 2022 for equipment acquisition[80](index=80&type=chunk) - There were **no cash inflows or outflows from financing activities** in H1 2022, contrasting with **$24.5 million in inflows** from a public offering and option exercises in H1 2021[81](index=81&type=chunk) - The **$21.2 million net proceeds** from the February 2021 public offering are being utilized to fund commercialization and development of B-TRAN™ technology and for general corporate and working capital purposes[82](index=82&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=22&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Ideal Power Inc is not required to provide these disclosures - The company is exempt from providing quantitative and qualitative disclosures about market risk as it qualifies as a **smaller reporting company**[85](index=85&type=chunk) [Item 4. Controls and Procedures](index=23&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes in internal controls - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were **effective** as of June 30, 2022[87](index=87&type=chunk) - There have been **no material changes** in internal controls over financial reporting during the quarter ended June 30, 2022[88](index=88&type=chunk) - The report highlights that control systems provide only **reasonable, not absolute, assurance** due to inherent limitations such as resource constraints, human error, circumvention by individual acts or collusion, and management override[89](index=89&type=chunk) [PART II - OTHER INFORMATION](index=24&type=section&id=PART%20II) This part covers other required disclosures, including legal proceedings, risk factors, and exhibits [Item 1. Legal Proceedings](index=24&type=section&id=Item%201.%20Legal%20Proceedings) Ideal Power Inc is not currently involved in any legal proceedings - The company is **not currently party to any legal proceedings**[92](index=92&type=chunk) [Item 1A. Risk Factors](index=24&type=section&id=Item%201A.%20Risk%20Factors) There are no material changes to the risk factors previously disclosed in the company's Annual Report - **No material changes** from the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2021[93](index=93&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=24&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or use of proceeds for this period - **No unregistered sales** of equity securities and use of proceeds were reported[94](index=94&type=chunk) [Item 3. Defaults Upon Senior Securities](index=24&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to Ideal Power Inc for the reporting period - This item is **not applicable**[95](index=95&type=chunk) [Item 4. Mine Safety Disclosures](index=24&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Ideal Power Inc for the reporting period - This item is **not applicable**[96](index=96&type=chunk) [Item 5. Other Information](index=24&type=section&id=Item%205.%20Other%20Information) No other information was reported under this item for the reporting period - **No other information** was reported[97](index=97&type=chunk) [Item 6. Exhibits](index=25&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Form 10-Q, including various certifications and Inline XBRL documents - The exhibits include certifications from the Principal Executive Officer (31.1) and Principal Financial Officer (31.2) pursuant to the Exchange Act, a certification pursuant to 18 U.S.C. 1350 (32.1), and various Inline XBRL documents (101.INS, 101.SCH, 101.CAL, 101.DEF, 10.LAB, 101.PRE, 104)[99](index=99&type=chunk) [SIGNATURES](index=26&type=section&id=SIGNATURES) This section contains the official signatures of the company's executive officers, dated August 15, 2022 - The report was signed on **August 15, 2022**, by R. Daniel Brdar, Chief Executive Officer, and Timothy W. Burns, Chief Financial Officer, on behalf of Ideal Power Inc[102](index=102&type=chunk)

Investor Presentation May 2022 Safe Harbor All statements in this presentation that are not based on historical fact are "forward looking statements." While management has based any forward looking statements included in this presentation on its current expectations, the information on which such expectations were based may change. These forward looking statements rely on a number of assumptions concerning future events and are subject to a number of risks, uncertainties and other factors, many of which are ...

Ideal Power Inc. (NASDAQ:IPWR) Q1 2022 Earnings Conference Call May 16, 2022 4:30 PM ET Company Participants Carolyn Capaccio – Investor Relations-LHA Dan Brdar – President and Chief Executive Officer Tim Burns – Chief Financial Officer Conference Call Participants David Williams – Benchmark Orin Hirschman – AIGH Investment Partners Don Slowinski – Winslow Asset Group Operator Good day and welcome to the Ideal Power, First Quarter 2022 Results Conference Call. Today’s conference is being recorded. At this ...

[PART I – FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) This section presents the unaudited condensed financial statements, management's discussion and analysis, market risk disclosures, and controls and procedures for the period [Item 1. Unaudited Condensed Financial Statements](index=4&type=section&id=Item%201.%20Unaudited%20Condensed%20Financial%20Statements) Q1 2022 saw a weakened financial position with decreased assets and equity, increased liabilities, and a higher net loss from increased operating expenses and reduced grant revenue [Balance Sheets](index=4&type=section&id=Balance%20Sheets%20at%20March%2031%2C%202022%20and%20December%2031%2C%202021) The balance sheet reflects a decrease in cash, total assets, and stockholders' equity, alongside an increase in total liabilities from December 2021 to March 2022 Balance Sheet Summary (March 31, 2022 vs. December 31, 2021) | Metric | March 31, 2022 | December 31, 2021 | Change | | :-------------------------- | :--------------- | :---------------- | :----- | | Cash and cash equivalents | $21,725,410 | $23,170,149 | $(1,444,739) | | Total current assets | $22,108,453 | $23,447,311 | $(1,338,858) | | Total assets | $24,507,763 | $25,877,480 | $(1,369,717) | | Total current liabilities | $756,083 | $542,871 | $213,212 | | Total liabilities | $1,930,614 | $1,727,555 | $203,059 | | Total stockholders' equity | $22,577,149 | $24,149,925 | $(1,572,776) | [Statements of Operations](index=5&type=section&id=Statements%20of%20Operations%20for%20the%20three%20months%20ended%20March%2031%2C%202022%20and%202021) The statements of operations show a significant increase in net loss for Q1 2022, driven by higher operating expenses and reduced grant revenue Statements of Operations Summary (Three Months Ended March 31) | Metric | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | YoY Change (%) | | :-------------------------- | :-------------------------------- | :-------------------------------- | :------------- | | Grant revenue | $125,008 | $242,061 | (48.36)% | | Cost of grant revenue | $125,008 | $242,061 | (48.36)% | | Gross profit | $— | $— | — | | Research and development | $828,547 | $260,880 | 217.59% | | General and administrative | $852,949 | $600,686 | 42.00% | | Sales and marketing | $219,429 | $62,578 | 250.65% | | Total operating expenses | $1,900,925 | $924,144 | 105.70% | | Loss from operations | $(1,900,925) | $(924,144) | 105.70% | | Net loss | $(1,904,641) | $(924,150) | 106.09% | | Net loss per share (basic and diluted) | $(0.31) | $(0.17) | 82.35% | - **Net loss increased by 106% year-over-year**, primarily due to a **105.7% increase in total operating expenses** and a **48.36% decrease in grant revenue**[13](index=13&type=chunk) [Statements of Cash Flows](index=6&type=section&id=Statements%20of%20Cash%20Flows%20for%20the%20three%20months%20ended%20March%2031%2C%202022%20and%202021) Cash flow analysis reveals increased cash usage in operating activities and a cessation of financing cash inflows in Q1 2022 compared to the prior year Statements of Cash Flows Summary (Three Months Ended March 31) | Cash Flow Activity | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Net cash used in operating activities | $(1,417,123) | $(843,337) | | Net cash used in investing activities | $(27,616) | $(30,737) | | Net cash provided by financing activities | $— | $24,505,835 | | Net increase (decrease) in cash and cash equivalents | $(1,444,739) | $23,631,761 | | Cash and cash equivalents at end of period | $21,725,410 | $26,789,017 | - **Net cash used in operating activities increased by 68.04% year-over-year**[16](index=16&type=chunk) - Financing activities provided **no cash in Q1 2022**, a significant decrease from **$24.51 million in Q1 2021**[16](index=16&type=chunk) [Statements of Stockholders' Equity](index=7&type=section&id=Statements%20of%20Stockholders%27%20Equity%20for%20the%20three%20months%20ended%20March%2031%2C%202022%20and%202021) Stockholders' equity decreased due to the net loss, partially offset by stock-based compensation and stock issued for services Stockholders' Equity Summary (March 31, 2022 vs. December 31, 2021) | Metric | December 31, 2021 | March 31, 2022 | | :-------------------------- | :---------------- | :--------------- | | Common Stock (Shares) | 5,893,767 | 5,905,118 | | Common Stock (Amount) | $5,894 | $5,905 | | Additional Paid-In Capital | $104,063,321 | $104,395,175 | | Accumulated Deficit | $(79,906,080) | $(81,810,721) | | Total Stockholders' Equity | $24,149,925 | $22,577,149 | - **Total stockholders' equity decreased by $1.57 million**, primarily due to the **net loss of $(1,904,641)** for the period, partially offset by stock-based compensation and stock issued for services[19](index=19&type=chunk) [Notes to Unaudited Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Financial%20Statements) Notes detail B-TRAN™ technology, accounting policies, intangible assets, lease obligations, commitments, and equity activities including offerings and incentive plans [Note 1 – Organization and Description of Business](index=8&type=section&id=Note%201%20%E2%80%93%20Organization%20and%20Description%20of%20Business) This note describes the company's focus on B-TRAN™ technology and its reliance on common stock and warrants for funding operations - The company is focused on the development and commercialization of its **Bidirectional bipolar junction TRANsistor (B-TRAN™) solid-state switch technology**[22](index=22&type=chunk) - Operations have been financed primarily through the sale of common stock and warrants, with future operations dependent on obtaining adequate funding through various sources[23](index=23&type=chunk) [Note 2 – Summary of Significant Accounting Policies](index=8&type=section&id=Note%202%20%E2%80%93%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the preparation of unaudited financial statements, treatment of pre-funded warrants, and exclusion of common share equivalents from diluted net loss per share - Unaudited financial statements are prepared in accordance with SEC Form 10-Q rules, with certain GAAP disclosures condensed or omitted[24](index=24&type=chunk) - Pre-funded warrants to purchase **253,828 shares of common stock** are included in the computation of basic net loss per share for both periods[26](index=26&type=chunk) - No common share equivalents are included in diluted net loss per share due to their anti-dilutive effect in periods with a net loss[27](index=27&type=chunk) [Note 3 – Intangible Assets](index=9&type=section&id=Note%203%20%E2%80%93%20Intangible%20Assets) This note details changes in patents and other intangible assets, including amortization expenses and capitalized patent costs Intangible Assets, Net | Metric | March 31, 2022 | December 31, 2021 | | :----------------------------------- | :--------------- | :---------------- | | Patents | $1,150,426 | $1,133,841 | | Other intangible assets | $1,391,479 | $1,391,479 | | Accumulated amortization – patents | $(171,142) | $(158,516) | | Accumulated amortization – other intangible assets | $(335,340) | $(311,154) | | **Total intangible assets, net** | **$2,035,423** | **$2,055,650** | - Amortization expense increased to **$36,812 for Q1 2022** from **$23,698 for Q1 2021**[29](index=29&type=chunk) - The company capitalized **$317,923** for costs related to patents not yet awarded at March 31, 2022[30](index=30&type=chunk) [Note 4 – Lease](index=9&type=section&id=Note%204%20%E2%80%93%20Lease) This note describes the new office and laboratory lease, including future minimum lease payments and remaining lease term - The company entered a new **63-month lease** for **4,070 square feet** of office and laboratory space in Austin, Texas, commencing June 1, 2021[32](index=32&type=chunk) Future Minimum Lease Payments | For the Year Ended December 31, | Amount | | :------------------------------ | :----- | | 2022 (remaining) | $57,659 | | 2023 | $78,517 | | 2024 | $80,552 | | 2025 | $82,587 | | 2026 | $56,132 | | **Total lease payments** | **$355,447** | - The remaining lease term was **53 months** at March 31, 2022, with an estimated incremental borrowing rate of **6% per annum**[33](index=33&type=chunk)[34](index=34&type=chunk) [Note 5 – Commitments and Contingencies](index=11&type=section&id=Note%205%20%E2%80%93%20Commitments%20and%20Contingencies) This note covers exclusive license agreements, estimated future payments, absence of legal proceedings, and the uncertain impact of the COVID-19 pandemic - The company has an exclusive royalty-free license agreement expiring in February 2033, with ongoing variable payments of **$20,000 per issued patent annually**, up to a maximum of **$100,000 per year** (all five associated patents are issued)[36](index=36&type=chunk) - The estimated present value of future payments under the licensing agreements was **$922,439** at March 31, 2022[37](index=37&type=chunk) - The company is not currently a party to any legal proceedings[38](index=38&type=chunk) - The COVID-19 pandemic has not had a material adverse impact on operations to date, but its future impact remains uncertain, with potential risks to capital raising and operating results[40](index=40&type=chunk) [Note 6 — Common Stock](index=11&type=section&id=Note%206%20%E2%80%94%20Common%20Stock) This note details the 2021 public offering, use of proceeds, and issuance of unregistered shares for vendor services in 2022 - In February 2021, the company completed a public offering, issuing **1,352,975 shares of common stock at $17.00 per share**, generating net proceeds of **$21.2 million**[41](index=41&type=chunk) - Proceeds from the public offering are intended to fund commercialization and development of B-TRAN™ technology and general corporate purposes[41](index=41&type=chunk) - In January 2022, **10,000 unregistered shares of common stock**, valued at **$100,100**, were issued to a third-party vendor as compensation for services[42](index=42&type=chunk) [Note 7 — Equity Incentive Plan](index=13&type=section&id=Note%207%20%E2%80%94%20Equity%20Incentive%20Plan) This note outlines available shares under the incentive plan, stock option activity, and unrecognized compensation costs - At March 31, 2022, **412,945 shares of common stock** were available for issuance under the 2013 Equity Incentive Plan[44](index=44&type=chunk) Stock Option Activity (Three Months Ended March 31, 2022) | Metric | Stock Options | Weighted Average Exercise Price | | :-------------------------- | :------------ | :------------------------------ | | Outstanding at Dec 31, 2021 | 492,886 | $7.35 | | Granted | 23,096 | $11.11 | | Exercised | (3,750) | $5.36 | | Forfeited | (16,250) | $9.33 | | Outstanding at Mar 31, 2022 | 495,982 | $7.48 | | Exercisable at Mar 31, 2022 | 386,828 | $6.46 | - A modification to stock option grants for a former Chairman extended the post-termination exercise period from 12 months to 5 years, resulting in **$49,327 of expense in Q1 2022**[46](index=46&type=chunk) - Unrecognized compensation cost related to non-vested equity awards was **$1,650,209** at March 31, 2022, expected to be recognized over a weighted average period of **1.3 years**[47](index=47&type=chunk) [Note 8 — Warrants](index=13&type=section&id=Note%208%20%E2%80%94%20Warrants) This note provides details on outstanding warrants, including pre-funded warrants, their exercise prices, and exercisability - At March 31, 2022, the company had **786,420 warrants outstanding** with a weighted average exercise price of **$5.19 per share**[48](index=48&type=chunk) - Additionally, **253,828 pre-funded warrants** were outstanding with an exercise price of **$0.001 per share** and no expiration date[48](index=48&type=chunk) - All warrants were exercisable at March 31, 2022, subject to beneficial ownership limitations[49](index=49&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=17&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section discusses financial performance, increased net loss from B-TRAN™ development and reduced grant revenue, COVID-19 impact, and liquidity [Overview](index=17&type=section&id=Overview) This overview reiterates the company's focus on B-TRAN™ technology, funding sources, grant revenue, and expected product introduction - Ideal Power Inc. is solely focused on the development and commercialization of its **B-TRAN™ solid-state switch technology**[56](index=56&type=chunk) - Operations have been funded primarily through the sale of common stock and warrants[57](index=57&type=chunk) - Grant revenue for Q1 2022 was **$125,008**, a decrease from **$242,061 in Q1 2021**[57](index=57&type=chunk) - The company expects to introduce its initial product for commercial sale in **late 2022**[61](index=61&type=chunk) [COVID-19 Impact](index=17&type=section&id=COVID-19%20Impact) This section assesses the COVID-19 pandemic's impact on operations, potential supply chain disruptions, and future risks - The COVID-19 pandemic has not had a material adverse impact on operations to date, but future developments remain highly uncertain[59](index=59&type=chunk) - Potential future disruptions include electrical component shortages, difficulties in securing fabrication capacity, and delays in development and commercialization activities[59](index=59&type=chunk) - A significant disruption in the semiconductor supply chain, due to COVID-19 and increased demand, may materially and adversely impact the company in the future[59](index=59&type=chunk) [Results of Operations](index=18&type=section&id=Results%20of%20Operations) This section analyzes changes in grant revenues, operating expenses, and the resulting increase in loss from operations and net loss Key Operating Expenses and Revenue Changes (Three Months Ended March 31) | Expense Category | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | YoY Change ($) | YoY Change (%) | | :-------------------------- | :-------------------------------- | :-------------------------------- | :------------- | :------------- | | Grant Revenues | $125,008 | $242,061 | $(117,053) | (48.36)% | | Cost of Grant Revenues | $125,008 | $242,061 | $(117,053) | (48.36)% | | Research and Development | $828,547 | $260,880 | $567,667 | 217.59% | | General and Administrative | $852,949 | $600,686 | $252,263 | 42.00% | | Sales and Marketing | $219,429 | $62,578 | $156,851 | 250.65% | | Loss from Operations | $(1,900,925) | $(924,144) | $(976,781) | 105.70% | | Net Loss | $(1,904,641) | $(924,150) | $(980,491) | 106.09% | - Research and development expenses increased by **218%** due to higher self-funded semiconductor fabrication costs, personnel costs, and stock-based compensation[63](index=63&type=chunk) - Sales and marketing expenses increased by **251%** due to the hiring of the first sales and marketing employees and commercialization efforts[65](index=65&type=chunk) [Liquidity and Capital Resources](index=20&type=section&id=Liquidity%20and%20Capital%20Resources) This section details cash and working capital, future funding needs, and changes in cash flows from operating and financing activities - At March 31, 2022, cash and cash equivalents totaled **$21.7 million**, with net working capital of **$21.4 million** and no outstanding debt[70](index=70&type=chunk) - Management expects current cash to fund activities for at least the next twelve months, but additional funds may be required to fully implement the plan of operation[70](index=70&type=chunk) - Net cash used in operating activities increased to **$1,417,123 in Q1 2022** from **$843,337 in Q1 2021**, and is expected to increase further throughout 2022[71](index=71&type=chunk)[72](index=72&type=chunk) - Financing activities provided **no cash in Q1 2022**, compared to **$24.51 million in Q1 2021** from a public offering and option/warrant exercises[73](index=73&type=chunk) [Critical Accounting Estimates](index=20&type=section&id=Critical%20Accounting%20Estimates) This section confirms no significant changes to critical accounting estimates from the prior annual report - There have been no significant changes to the critical accounting estimates disclosed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2021[75](index=75&type=chunk) [Trends, Events and Uncertainties](index=20&type=section&id=Trends%2C%20Events%20and%20Uncertainties) This section confirms no material changes to trends, events, or uncertainties from the prior annual report - There are no material changes from trends, events, or uncertainties disclosed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2021[76](index=76&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=20&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Ideal Power Inc. is not required to provide quantitative and qualitative disclosures about market risk - The company is not required to provide quantitative and qualitative disclosures about market risk as it is a smaller reporting company[77](index=77&type=chunk) [Item 4. Controls and Procedures](index=21&type=section&id=Item%204.%20Controls%20and%20Procedures) Management found disclosure controls effective, with no material changes to internal controls, acknowledging inherent system limitations [Evaluation of Disclosure Controls and Procedures](index=21&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section confirms the effectiveness of the company's disclosure controls and procedures as of March 31, 2022 - The company's disclosure controls and procedures were evaluated and concluded to be effective as of March 31, 2022[78](index=78&type=chunk) [Changes in Internal Control over Financial Reporting](index=21&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) This section reports no material changes in internal controls over financial reporting during the quarter - There have been no material changes in internal controls over financial reporting during the quarter ended March 31, 2022[79](index=79&type=chunk) [Limitations on the Effectiveness of Controls](index=21&type=section&id=Limitations%20on%20the%20Effectiveness%20of%20Controls) This section highlights that control systems provide reasonable, not absolute, assurance due to inherent limitations - Control systems provide only reasonable, not absolute, assurance due to inherent limitations such as resource constraints, faulty judgments, errors, circumvention, and management override[80](index=80&type=chunk) [PART II – OTHER INFORMATION](index=22&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) This section covers non-financial disclosures, including the absence of current legal proceedings, no material changes to risk factors, details on unregistered equity sales, and a list of exhibits filed with the report [Item 1. Legal Proceedings](index=22&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any legal proceedings, though it may be subject to litigation in the ordinary course of business - The company is not currently a party to any legal proceedings[83](index=83&type=chunk) [Item 1A. Risk Factors](index=22&type=section&id=Item%201A.%20Risk%20Factors) This section states there are no material changes to the risk factors disclosed in the prior annual report - There are no material changes from the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2021[84](index=84&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=22&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the issuance of unregistered common stock to a vendor for services in January 2022 under a private placement exemption - In January 2022, **10,000 unregistered shares of common stock**, valued at **$100,100**, were issued to a third-party vendor as compensation for services performed[85](index=85&type=chunk) - The shares were issued in a private placement pursuant to Section 4(a)(2) of the Securities Act[85](index=85&type=chunk) [Item 3. Defaults Upon Senior Securities](index=22&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to the company - This item is not applicable[86](index=86&type=chunk) [Item 4. Mine Safety Disclosures](index=22&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable[87](index=87&type=chunk) [Item 5. Other Information](index=22&type=section&id=Item%205.%20Other%20Information) This section confirms no other information to report under this item - No other information to report[88](index=88&type=chunk) [Item 6. Exhibits](index=23&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications and XBRL documents - Exhibits include certifications (31.1, 31.2, 32.1) and Inline XBRL documents (101.INS, 101.SCH, 101.CAL, 101.DEF, 10.LAB, 101.PRE, 104)[90](index=90&type=chunk) [SIGNATURES](index=24&type=section&id=SIGNATURES) This section contains the signatures of the Chief Executive Officer and Chief Financial Officer, dated May 16, 2022 - The report was signed on May 16, 2022, by R. Daniel Brdar (Chief Executive Officer) and Timothy W. Burns (Chief Financial Officer)[93](index=93&type=chunk)