Quarterly report pursuant to Section 13 or 15(d)

Stockholders' Equity

v3.22.1
Stockholders' Equity
3 Months Ended
Mar. 31, 2022
Equity [Abstract]  
Stockholders' Equity

8.

Stockholders’ Equity

Authorized, Issued, and Outstanding Common Stock

The Company’s authorized common stock has a par value of $0.001 per share and consists of 100,000,000 shares as of March 31, 2022, and December 31, 2021; 29,221,158 and 28,705,334 shares were issued and outstanding at March 31, 2022, and December 31, 2021, respectively.

The following table summarizes common stock share activity for the three months ended March 31, 2022 and 2021 (dollars in thousands):

 

 

 

Three Months Ended March 31, 2022

 

 

 

Shares of

Common Stock

 

 

Common

Stock

 

 

Additional

Paid-in

Capital

 

 

Accumulated

Deficit

 

 

Total

Stockholders’

Equity

 

Balance, December 31, 2021

 

 

28,705,334

 

 

$

32

 

 

$

400,705

 

 

$

(359,479

)

 

$

41,258

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(5,451

)

 

 

(5,451

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

922

 

 

 

 

 

 

922

 

Common stock issued, net of expenses

 

 

487,610

 

 

 

 

 

 

2,135

 

 

 

 

 

 

2,135

 

Common stock issued through employee stock purchase plan

 

 

3,120

 

 

 

 

 

 

10

 

 

 

 

 

 

10

 

Common stock issued for vested restricted stock units

 

 

25,094

 

 

 

 

 

 

(18

)

 

 

 

 

 

(18

)

Vested Loan Agreement warrants

 

 

 

 

 

 

 

 

71

 

 

 

 

 

 

 

71

 

Balance, March 31, 2022

 

 

29,221,158

 

 

$

32

 

 

$

403,825

 

 

$

(364,930

)

 

$

38,927

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended March 31, 2021

 

 

 

Shares of

Common Stock

 

 

Common

Stock

 

 

Additional

Paid-in

Capital

 

 

Accumulated

Deficit

 

 

Total

Stockholders’

Equity

 

Balance, December 31, 2020

 

 

19,663,698

 

 

$

20

 

 

$

349,351

 

 

$

(326,613

)

 

$

22,758

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(4,676

)

 

 

(4,676

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

398

 

 

 

 

 

 

398

 

Common stock issued for conversion of April 2020 Notes

 

 

959,080

 

 

 

1

 

 

 

7,452

 

 

 

 

 

 

7,453

 

Common stock issued through employee stock purchase plan

 

 

2,184

 

 

 

 

 

 

6

 

 

 

 

 

 

6

 

Common stock issued for vested restricted stock units

 

 

675

 

 

 

 

 

 

(15

)

 

 

 

 

 

(15

)

Balance, March 31, 2021

 

 

20,625,637

 

 

$

21

 

 

$

357,192

 

 

$

(331,289

)

 

$

25,924

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares Reserved for Future Issuance

The Company had reserved shares of common stock for future issuance as follows:

 

 

 

March 31, 2022

 

 

December 31, 2021

 

Outstanding stock options

 

 

2,050,094

 

 

 

1,542,126

 

Outstanding restricted stock units

 

 

981,841

 

 

 

133,834

 

Warrants to purchase common stock associated with March 2018 Public Offering – Series 2

 

 

798,810

 

 

 

798,810

 

Warrants to purchase common stock associated with December 2020 Public Offering - Series 2

 

 

6,800,000

 

 

 

6,800,000

 

Prefunded warrants to purchase common stock associated with December 2020 Public Offering

 

 

3,200,000

 

 

 

3,200,000

 

Warrants to purchase common stock associated with Loan Agreement

 

 

198,819

 

 

 

170,410

 

Warrant to purchase common stock associated with Danforth

 

 

50,000

 

 

 

50,000

 

For possible future issuance for the conversion of the March 2019 Notes

 

 

1,138,200

 

 

 

1,138,200

 

For possible future issuance under 2014 Plan (Note 9)

 

 

150,114

 

 

 

295,220

 

For possible future issuance under Employee Stock Purchase Plan

 

 

3,714

 

 

 

3,893

 

For possible future issuance under 2015 Plan (Note 9)

 

 

147,250

 

 

 

235,000

 

Total common shares reserved for future issuance

 

 

15,518,842

 

 

 

14,367,493

 

 

 

Common Stock Purchase Agreement and Sales Agreement

On April 10, 2020, the Company entered into the Common Stock Purchase Agreement with Aspire Capital pursuant to which the Company has the right to sell to Aspire Capital from time to time in its sole discretion up to $20.0 million in shares of the Company’s common stock over the next 30 months, subject to certain limitations and conditions set forth in the Common Stock Purchase Agreement.  The aggregate number of shares that we can sell to Aspire Capital under the Common Stock Purchase Agreement may in no case exceed 1,956,547 shares of the Company’s common stock (which is equal to approximately 19.99% of the common stock outstanding on the date of the Common Stock Purchase Agreement), including the 70,910 commitment shares (the Exchange Cap), unless either (a) shareholder approval is obtained to issue more, in which case the Exchange Cap will not apply, or (b) the average purchase price of all shares sold under the Common Stock Purchase Agreement exceeds $8.461; provided that at no time shall Aspire Capital (together with its affiliates) beneficially own more than 19.99% of the Company’s common stock.  During the three months ended March 31, 2022, the Company sold 350,000 of its common stock under the Common Stock Purchase Agreement for gross proceeds of $1.5 million and did not sell any common stock during the three months ended March 31, 2021.  During the months ended March 31, 2022, the Company sold 137,610 shares of its common stock and received net proceeds of $0.7 million, and did not sell any common stock during the three months ended March 31, 2021 under the Controlled Equity OfferingSM Sales Agreement with Cantor Fitzgerald & Co. and Ladenburg Thalmann & Co. Inc.

Warrants Associated with the March 2018 and December 2020 Public Offerings

The outstanding warrants associated with the March 2018 and December 2020 public offerings contain a provision where the warrant holder has the option to receive cash, equal to the Black-Scholes fair value of the remaining unexercised portion of the warrant, as cash settlement in the event that there is a fundamental transaction (contractually defined to include various merger, acquisition or stock transfer activities). Due to this provision, ASC 480, Distinguishing Liabilities from Equity, requires that these warrants be classified as liabilities. The fair values of these warrants have been determined using the Black-Scholes valuation model, and the changes in the fair value are recorded in the accompanying unaudited interim condensed consolidated statements of operations.  During the three months ended March 31, 2022 and 2021, the Company recognized gains of $10.0 million and $1.3 million on the warrant liabilities fair value adjustment.  As of March 31, 2022 and December 31, 2021, the fair value of the warrant liabilities was $8.0 million and $18.1 million, respectively.

Warrants Associated with Loan Agreement

In connection with the entry into the Loan Agreement, the Company issued to each of Hercules and SVB a warrant (collectively, the “Warrants”) to purchase shares of the Company’s common stock, par value $0.001 per share (the “Shares”).  The amount of shares that may be purchased for the Warrants, collectively between Hercules and SVB, will not exceed 0.04 multiplied by the aggregate amount of the term loan advances, divided by the exercise price of the Warrants.  At the closing of the Loan Agreement, the Company issued 113,607 warrants to purchase shares of the Company’s common stock and recognized the initial warrants at their relative fair value in shareholder's equity.  

Upon the funding of the $10.0 million and $5.0 million for the second and third tranches in June 2021 and March 2022, respectively, the associated warrant liabilities of $0.3 million and $0.1 million, respectively, were reclassed to additional paid in capital at settlement. In June 2021 and March 2022, 56,803 and 28,409 warrants to purchase shares of the Company’s common stock were issued upon vesting of the second and third tranches, respectively.