|6 Months Ended|
Jun. 30, 2015
8. Capital Structure
As of June 30, 2015, the Company was authorized to issue 100,000,000 shares of common stock at $0.0001 par value per share.
On June 12, 2015, the Company closed a private placement of its securities with a group of institutional investors (the “PIPE”). Each investor received one share of common stock and a warrant to purchase one-half share of common stock at an exercise price of $8.00 per full share, at a price of $4.23 per common share purchased. The closing of the PIPE resulted in the sale of an aggregate of 4,728,128 common shares and the issuance of warrants to purchase an additional 2,364,066 shares of common stock (the “PIPE Warrants”). The Company received net proceeds from the PIPE of $18.3 million, after deducting expenses payable by the Company.
Initial Public Offering
On August 1, 2014, the Company closed an initial public offering of its units (the “IPO”). Each unit consisted of one share of common stock, one Class A Warrant to purchase one share of common stock at an exercise price of $4.80 per share and one Class B Warrant to purchase one-half share of common stock at an exercise price of $4.00 per full share (the “Units”). The closing of the IPO resulted in the sale of an aggregate of 6,880,333 Units at a public offering price of $6.00 per Unit, less underwriting discounts and commissions and the underwriter’s expenses, including 880,333 Units issued upon the exercise by the underwriters of their option to purchase additional Units at the public offering price to cover over-allotments. The Company received net proceeds from the IPO of $35.0 million, after deducting underwriting discounts, commissions, and expenses payable by the Company. The common stock and accompanying Class A and Class B warrants have been classified to stockholders’ equity (deficit) in the Company’s balance sheet.
In July 2014, the stockholders approved an amended certificate of incorporation that became effectively immediately upon the closing of the Company’s IPO. The approved certificate increased the number of authorized shares of common stock to 100,000,000 shares.
Maxim, the underwriter in the IPO, received a warrant to purchase 3% of the total number of shares of common stock sold in the IPO, including those shares sold upon the exercise of the over-allotment option, for a total of 206,410 shares of common stock underlying the underwriter’s warrant. The warrant is exercisable at an exercise price of $7.50 per share beginning 180 days after the effective date of the Company’s registration statement and expiring on August 27, 2019. The Company classified this warrant as a liability since it did not meet the requirements to be included in equity. The fair value of the warrant will be re-measured at each reporting period and changes in fair value will be recognized in the statement of operations.
The holders of shares of common stock are entitled to one vote for each share of common stock held at all meetings of stockholders and written actions in lieu of meetings.
The holders of shares of common stock are entitled to receive dividends, if and when declared by the board of directors. As of June 30, 2015, no dividends have been declared or paid on the Company’s common stock since inception.
Reserved for Future Issuance
The Company has reserved for future issuance the following number of shares of common stock as of June 30, 2015 and December 31, 2014:
Convertible Preferred Stock
On August 1, 2014, in conjunction with the closing of the Company’s IPO, all outstanding shares of the Company’s preferred stock, including the in-kind dividend payable, were automatically converted into 6,861,968 shares of its common stock.
The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.
Reference 1: http://www.xbrl.org/2003/role/presentationRef