Quarterly report pursuant to Section 13 or 15(d)

WARRANTS

v3.7.0.1
WARRANTS
6 Months Ended
Jun. 30, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
WARRANTS

NOTE 10 – WARRANTS

 

On February 28, 2017, Russell Richerson, PhD, resigned as chief operating officer of the Company, effective immediately. Dr. Richerson entered into a separation release of claims agreement (“Separation Agreement”) pursuant to which we issued Dr. Richerson a warrant to purchase 76,726 shares of Common Stock with an exercise price of $0.75 per share and a term of 3.5 years.

 

In connection with the sale of our Series C Preferred Stock in March and April 2017, we issued an aggregate of: (i) 387,251 Series M common stock purchase warrants (“Series M Warrants”), (ii) 387,251Series N common stock purchase warrants (“Series N Warrants”) and (iii) 387,251 Series O common stock purchase warrants (“Series O Warrants”) (collectively, the “Warrants”). The Series M Warrants have an exercise price of $0.90 per share, subject to adjustment, and a term of five (5) years from the date of issuance, the Series N Warrants have an exercise price of $0.75 per share, subject to adjustment, and a term of six (6) months from the date of issuance and the Series O warrants have an exercise price of $0.75, subject to adjustment, and a term of twelve (12) months from the date of issuance. The Warrants are immediately exercisable and separately transferable from the Series C Preferred Stock. In the event that the shares underlying the Warrants are not subject to a registration statement at the time of exercise, the Warrants may be exercised on a cashless basis after 6 months from the issuance date. The Warrants also contain provisions providing for an adjustment in the underlying number of shares and exercise price in the event of stock splits or dividends and fundamental transactions. Additionally, the Warrants contain anti-dilution protection until the twelve (12) month anniversary of the issuance date.

 

Transactions involving our warrants are summarized as follows:

 

      Number of
shares
    Weighted-
average exercise
price
    Weighted-average
remaining contractual
term (in years)
    Aggregate
intrinsic
value (in
thousands)
 
Outstanding at December 31, 2016       5,203,436     $ 4.56                  
Issued       1,238,479       0.80                  
Expired       (1,338,373 )   $ 0.58                  
Outstanding at June 30, 2017       5,103,542     $ 4.47       2.2     $  
                                     
Exercisable at June 30, 2017       5,097,829     $ 4.47       2.2     $  

 

The following table summarizes outstanding common stock purchase warrants as of June 30, 2017:

 

    Number of
shares
    Weighted-
average
exercise
price
    Expiration  
Issued to consultants     104,213     $ 7.24       January 2018 through August 2023  
Issued pursuant to 2013 financings     155,819     $ 61.11       December 2017 through August 2018  
Issued pursuant to 2014 financings     96,412     $ 34.50       June 2019  
Issued pursuant to 2015 financings     785,339     $ 8.65       July 2017 through January 2021  
Issued pursuant to 2016 financings     2,800,006     $ 0.53       December 2017 through December 2021  
Issued pursuant to 2017 financings     1,161,753     $ 0.80       September 2017 through April 2022  
      5,103,542                  

 

Total stock-based compensation expense of approximately $30,000 and $0 was recognized for warrants and included in the statement of operations for the six months ended June 30, 2017 and 2016, respectively.