9. Capital Structure

On February 10, 2023, the stockholders of the Company approved a reverse stock-split of the Company’s outstanding shares of common stock at a ratio ranging from any whole number between 1-for-10 and 1-for-80, as determined by the Board of Directors in its discretion. The Board subsequently determined to implement a reverse stock split at a ratio of 1-for-80. The stock split became effective on February 14, 2023. Accordingly, all share and per share amounts for all periods presented in the accompanying financial statements and notes thereto have been retroactively adjusted, where applicable, to reflect this reverse stock split. Shares of common stock underlying outstanding stock options and other equity instruments were proportionately decreased and the respective per share value and exercise prices, if applicable, were proportionately increased in accordance with the terms of the agreements governing such securities.

Common Stock

As of September 30, 2023, the Company was authorized to issue 125,000,000 shares of common stock.

Follow-on Offerings

On May 27, 2020, the Company completed an underwritten public offering of 147,471 shares of its common stock and warrants to purchase an additional 110,603 shares of its common stock at an exercise price of $392.00 per share. The public offering price was $356.00 for one share of common stock and an accompanying warrant to purchase 0.75 shares of common stock, resulting in net proceeds to the Company of $48.9 million after underwriting discounts and commissions and offering expenses payable by the Company. The Company completed a concurrent private placement to Pfizer of 8,427 shares of common stock and an accompanying warrant to purchase an additional 6,320 shares of its common stock at an exercise price of $392.00 per share of common stock (the “Pfizer Warrant”), resulting in net proceeds to the Company of $3.0 million.

On March 22, 2021, the Company completed an underwritten public offering of 143,750 shares of its common stock, including shares sold pursuant to the fully exercised overallotment option granted to the underwriters in connection with the offering, at a public offering price of $400.00 per share, resulting in net proceeds to the Company of $53.8 million after underwriting discounts and commissions and offering expenses payable by the Company.

On December 15, 2022, the Company completed the 2022 Offering. All shares of common stock, the 2022 pre-funded warrant, the Class A Warrant and the Class B Warrant were issued together to a single accredited investor purchaser for consideration equating to $10.32 share of common stock (or 2022 pre-funded warrant to purchase one share of common stock, less a nominal exercise price), together with a Class A Warrant to purchase two shares of common stock and a Class B warrant to purchase one share of common stock, in the case of each of the Class A Warrant and Class B Warrant, for no additional consideration but each with an exercise price per share of $10.32, for aggregate net proceeds to the Company of $6.1 million after placement agent fees and offering expenses payable by the Company. As of January 20, 2023, the 2022 pre-funded warrant had been fully exercised.

At issuance, the 2022 Warrants were not exercisable and only became exercisable following (i) stockholder approval of (and the effectiveness of) an amendment to the Company’s certificate of incorporation that either combines outstanding shares of common stock with such combination ratio as determined by the Company’s board of directors and/or authorizes additional shares of common stock to such number as determined by the Company’s board of directors, in each case, so as to enable the issuance of the number of shares of common stock underlying the 2022 Warrants (disregarding any limitations on the exercise thereof), and (ii) the issuance of all shares of common stock issued in, or issuable pursuant to the exercise of the 2022 pre-funded warrant or 2022 Warrants issued in, the 2022 Offering as may have been required by the applicable rules and regulations of the Nasdaq Stock Market.

On February 10, 2023, the stockholders of the Company approved the issuance of all shares of common stock issued in, or issuable pursuant to the exercise of the 2022 pre-funded warrant or 2022 Warrants issued in the 2022 Offering as may have been required by the applicable rules and regulations of the Nasdaq Stock Market, the approval of which, together with the approval and effectiveness of the 1-for-80 reverse stock-split effected on February 14, 2023, commenced the exercisability of the 2022 Warrants as of February 14, 2023. The resulting expiration dates of the 2022 Warrants have been reflected, where applicable, in the accompanying financial statements and notes thereto. On March 2, 2023, the exercise price of the 2022 Warrants, which are subject to an anti-dilution adjustment, were adjusted to $4.00 per share as a result of the 2023 Offering.

On March 2, 2023, the Company completed the 2023 Offering. All securities in the 2023 Offering were issued to the same single accredited investor purchaser from the 2022 Offering for consideration equating to $4.00 per share of common stock (or 2023 pre-funded warrant to purchase one share of common stock, less a nominal exercise price), together with a warrant to purchase two shares of common stock for no additional consideration but with an exercise price per share of $4.00, for aggregate net proceeds to the Company of $9.1 million after placement agent fees and offering expenses payable by the Company. As of April 17, 2023, the 2023 pre-funded warrant had been fully exercised.

On June 26, 2023, the Company entered into the Inducement Agreement with the Holder to exercise common stock purchase warrants and purchase up to an aggregate of 7,034,883 shares of the Company’s common stock. The Inducement Agreement provided the Holder with the opportunity to exercise all of the Existing Warrants held by the Holder, each at a reduced exercise price from $4.00 to $1.36 per underlying share, which was equal to the most recent closing price of the Company’s common stock on The Nasdaq Capital Market prior to the execution of the Inducement Agreement. In consideration for exercising the Existing Warrants at an exercise price equal to $1.36 per underlying share, the Company issued to the Holder the Class C Warrant to purchase up to 1,406,977 shares of common stock, at an exercise price equal to $1.36 per underlying share and the Class D Warrant to purchase up to 5,627,906 shares of common stock, at an exercise price equal to $1.36 per underlying share. The proceeds to the Company from the Warrant Exercise were $9.6 million, prior to deducting fees to the financial advisor and estimated expenses.

At issuance, the New Warrants were not exercisable and only become exercisable following stockholder approval of the issuance of all shares of common stock issued in, or issuable pursuant to the exercise of the New Warrants issued pursuant to the Inducement Agreement as may have been required by the applicable rules and regulations of the Nasdaq Stock Market.

The Class C Warrant and the warrants issued by the Company in its 2022 and 2020 offerings of securities contained certain terms that the Company determined required classification as liabilities in accordance with ASC 815. At issuance, the Company determined the fair value of the Class C Warrant, the 2022 Warrants and the 2020 Warrants to be $1.8 million, $11.0 million and $31.4 million, respectively, and recorded these balances as warrant liabilities, and reducing the amount of net proceeds recorded as additional paid-in-capital. The fair value of the 2022 Warrants exceeded the proceeds received in the 2022 Offering and the excess of $4.0 million was expensed as other expense. The Company consummated the 2022 Offering on market terms available at the time of the transaction to provide additional funding to advance its product candidates. The fair value of these warrants is re-measured at each reporting period and changes in fair value are recognized in the consolidated statement of operations (see Note 4, “Fair Value Measurements”). Additionally, the Company allocated $0.1 million, $0.9 million and $2.2 million of issuance costs to the Class C Warrant, the 2022 Warrants and the 2020 Warrants, respectively, based on the proportion of the proceeds allocated to the fair value of the warrants. The allocated issuance costs were expensed as other expense. The Class D Warrant, the 2023 Warrant and the Pfizer Warrant do not contain the same provisions and therefore the Company determined that the Class D Warrant, the 2023 Warrant and the Pfizer Warrant should be classified as equity in the Company’s consolidated balance sheet.

Voting

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.

Dividends

The holders of shares of common stock are entitled to receive dividends, if and when declared by the board of directors. As of September 30, 2023, no dividends have been declared or paid on the Company’s common stock since inception.

Reserved for Future Issuance