Annual report pursuant to Section 13 and 15(d)

STOCKHOLDERS' EQUITY

v3.22.1
STOCKHOLDERS' EQUITY
12 Months Ended
Dec. 31, 2021
STOCKHOLDERS' EQUITY [Abstract]  
STOCKHOLDERS' EQUITY

8.

STOCKHOLDERS’ EQUITY

 

Preferred Stock

 

The Company is currently authorized to issue up to 10 million shares of preferred stock, $0.0001 par value per share. There were no shares of preferred stock outstanding at December 31, 2021 and 2020.

 

Common Stock

 


As of December 31, 2021 and 2020, the Company was authorized to issue 300,000,000 and 150,000,000 shares, respectively, of its common stock, $0.0001 par value per share, and 195,813,817 and 104,902,888 shares of common stock were outstanding as of December 31, 2021 and 2020, respectively.  On May 27, 2021, the Company amended its Second Amended and Restated Certificate of Incorporation to increase the number of shares of common stock that the Company is authorized to issue from 150,000,000 to 300,000,000. After giving effect to shares reserved for the issuance of warrants and for awards issued under the Company’s equity incentive plans, 87,241,078 shares of common stock were available for issuance as of December 31, 2021.


On October 25, 2021, the Company completed an underwritten public offering whereby the Company issued 57.5 million shares of common stock and received gross proceeds of $57.5 million. Net proceeds after underwriting discounts and expenses associated with the offering, were approximately $53.8 million, and are being used (i) to advance the commercial sales of the Company’s FDA approved products through the procurement of raw materials for the manufacturing of BIVIGAM and ASCENIV; (ii) to expand the Company’s plasma collection facility network; (iii) to scale up the manufacturing capacity of the Boca Facility and make continuous improvements in order to adhere to cGMP compliance; (iv) to explore business development opportunities; and (v) for general corporate purposes and other capital expenditures.

On September 3, 2021, the Company entered into a distribution agreement with Raymond James & Associates, Inc., as agent (“Agent”), pursuant to which the Company may offer and sell, from time to time, at its option, through or to the Agent, up to an aggregate of $50 million of shares of the Company’s common stock (the “Distribution Agreement”). The Company currently intends to use any net proceeds from the sale of its common stock under the Distribution Agreement for general corporate purposes, including procurement of source plasma and other raw materials, supply chain initiatives and production expenditures, funding expansion of plasma centers, working capital, capital expenditures, expansion and resources for commercialization activities, and other potential research and development and business opportunities. During the year ended December 31, 2021, the Company issued 5,540,831 shares of its common stock under the Distribution Agreement and received net proceeds of $6.9 million.


On August 5, 2020, the Company entered into an open market sale agreement (as amended from time to time, the “Sale Agreement”) with Jefferies LLC (“Jefferies”), pursuant to which the Company could offer and sell, from time to time, at its option, through or to Jefferies, up to an aggregate of $50 million of shares of the Company’s common stock. On November 5, 2020 and February 3, 2021, the Company and Jefferies amended the Sale Agreement to provide for increases in the aggregate offering amount under the Sale Agreement such that the Company could sell shares having an aggregate offering price of up to $105.4 million under the Sale Agreement, as amended. For the year ended December 31, 2021, the Company issued and sold 27,805,198 shares of common stock under the 2020 Sale Agreement and received net proceeds of $60.4 million. For the year ended December 31, 2020, the Company sold 18,537,907 shares of common under the Sale Agreement and received net proceeds of $42.5 million.

 

On February 11, 2020, the Company completed an underwritten public offering of 23,500,000 shares of its common stock for gross proceeds of $82.3 million. On February 21, 2020, the Company sold an additional 3,525,000 shares pursuant to the underwriters’ exercise of their option to purchase additional shares of the Company’s common stock for additional gross proceeds of $12.3 million. The Company received net proceeds, after underwriting discounts and other expenses associated with the offering, of approximately $88.7 million.

 

During the year ended December 31, 2020, the Company issued 6,626 shares of common stock in connection with the exercise of stock options that had been granted to employees.

 

Warrants

 

On December 8, 2020, the Company issued the Perceptive Tranche IV Warrant, whereby Perceptive may purchase an aggregate of 2,390,000 shares of common stock at an exercise price $1.94 per share (see Note 7). The warrant was valued at $3.7 million, using the Black-Scholes option-pricing model assuming an expected term of 10 years, a volatility of 69.3%, a dividend yield of 0% and a risk-free interest rate of 0.92%.



At December 31, 2021 and 2020, the Company had outstanding warrants to purchase an aggregate of 4,528,160 shares of common stock, with a weighted average exercise price of $2.82 per share and expiration dates ranging between June 2022 and December 2030.

Equity Incentive Plans

 

From time to time the Company grants stock options or other equity-based awards under the Company’s Amended and Restated 2014 Omnibus Incentive Compensation Plan (the “2014 Plan”).



The 2014 Plan, as amended, was approved by the Board on March 15, 2017 and by the Company’s stockholders on May 25, 2017.  Currently, the maximum number of shares reserved for grant under the 2014 Plan is: (a) 2,334,940 shares; plus (b) an annual increase as of the first day of the Company’s fiscal year, beginning in 2018 and occurring each year thereafter through 2022, equal to 4% of the outstanding shares of common stock as of the end of the Company’s immediately preceding fiscal year, or any lesser number of shares determined by the Board; provided, however, that no more than an aggregate of 10 million shares of common stock may be issued pursuant to incentive stock options intended to qualify under Section 422 of the Internal Revenue Code. As of December 31, 2021, an aggregate of 69,090 shares were available for issuance under the 2014 Plan. In accordance with the foregoing, on January 1, 2022 the aggregate number of shares available for issuance increased to 7,901,643.

During the years ended December 31, 2021 and 2020, the Company granted options to purchase an aggregate of 1,895,550 and 1,468,412 shares of common stock, respectively, to its directors, employees and certain third-party service providers.  The fair value of stock options granted was determined on the date of grant using the Black-Scholes model. The Black-Scholes option valuation model was developed for use in estimating the fair value of publicly traded options, which have no vesting restrictions and are fully transferable. The Company’s employee stock options have characteristics significantly different from those of traded options, and changes in the underlying Black-Scholes assumptions can materially affect the fair value estimate. To determine the risk-free interest rate, the Company utilized the U.S. Treasury yield curve in effect at the time of the grant with a term consistent with the term of the awards granted by the Company. The expected term of the options granted is in accordance with Staff Accounting Bulletins 107 and 110, which is based on the average between vesting terms and contractual terms. The expected dividend yield reflects the Company’s current and expected future policy for dividends on the Company’s common stock. For the years ended December 31, 2021 and 2020, the expected stock price volatility for the Company’s stock options was calculated by examining the historical volatility of the Company’s common stock since the stock became publicly traded in the fourth quarter of 2013.

 

The grant date fair values of stock options awarded during the years ended December 31, 2021 and 2020 were determined using the Black-Scholes option-pricing model with the following assumptions:

 

 

 

Years Ended

 

 

 

December 31,

2021

   

December 31,

2020

 

Expected term

 

5.5-6.3 years

   

5.5-6.3 years

 

Volatility

   

68-70

%

   

62-70

%

Dividend yield

    0.0
      0.0
 

Risk-free interest rate

   

0.80-1.27

%

   

0.33-1.68

%


The 2014 Plan provides for the Board or a Committee of the Board (the “Committee”) to grant awards to optionees and to determine the exercise price, vesting term, expiration date and all other terms and conditions of the awards, including acceleration of the vesting of an award at any time. All options granted under the 2014 Plan are intended to be incentive stock options (“ISOs”), unless specified by the Committee to be non-qualified options (“NQOs”) as defined by the Internal Revenue Code. ISOs and NQOs may be granted to employees, consultants or Board members at an option price not less than the fair market value of the common stock subject to the stock option agreement. The following table summarizes information about stock options outstanding as of December 31, 2021 and 2020:

   

 

 

Shares

   

Weighted

Average

Exercise Price

 

Options outstanding, vested and expected to vest at December 31, 2019

    5,630,351     $ 4.76  

Forfeited

    (141,724 )   $ 3.81  

Expired

    (27,482 )   $ 4.26  

Granted

    1,468,412     $ 2.93  

Exercised

    (6,626 )   $ 2.03  

Options outstanding, vested and expected to vest at December 31, 2020

    6,922,931     $ 4.40  

Forfeited

    (529,202 )   $ 2.89  

Expired

    (426,557 )   $ 4.91  

Granted

    1,895,550     $ 2.14  

Exercised

    -  
-  

Options outstanding, vested and expected to vest at December 31, 2021

    7,862,722     $ 3.93  

 

               

Options exercisable

    5,521,312
    $ 4.54  

    


As of December 31, 2021, the Company had $3.1 million of unrecognized compensation expense related to stock options granted under the Company’s equity incentive plan, which is expected to be recognized over a weighted-average period of 2.4 years. The weighted average remaining contractual term of stock options outstanding and expected to vest at December 31, 2021 is 6.1 years. The weighted average remaining contractual term of stock options exercisable at December 31, 2021 is 4.9 years.The following table summarizes additional information regarding outstanding and exercisable options under the stock option plans at December 31, 2021:

 

 

 

 

Stock Options Outstanding

 

 

Stock Options Exercisable

 

Range of

Exercise Prices

 

 

Options Outstanding

 

 

Weighted

Average

Remaining

Contractual

Life (Years)

 

 

Weighted Average Exercise Price

 

 

Aggregate Intrinsic Value

 

 

Options Outstanding

 

 

Weighted

Average

Remaining

Contractual

Life (Years)

 

 

Weighted Average Exercise Price

 

 

Aggregate Intrinsic Value

 

$1.10 - $1.67

 

 

 

352,500

 

 

 

9.6

 

 

$ 1.10

 

 

$ 35,935

 

 

 

15,583

 

 

 

9.8

 

 

$ 1.10

 

 

$ 4,831

 

$1.73 - $2.60

 

 

 

1,673,518

 

 

 

8.9

 

 

$ 2.42

 

 

 

-

 

 

 

374,318

 

 

 

8.5

 

 

$ 2.42

 

 

 

-

 

$2.62 - $3.93

 

 

 

4,209,177

 

 

 

5.9

 

 

$ 3.51

 

 

 

-

 

 

 

3,554,848

 

 

 

5.6

 

 

$ 3.51

 

 

 

-

 

$3.98 - $5.97       487,040       5.6     $
5.07       -       442,202       5.4     $
5.07          
$6.02 - $9.03       892,987       1.1     $
7.74       -       886,861       1.0     $
7.74          

$9.37 - $10.80

 

 

 

247,500

 

 

 

2.9

 

 

$ 10.28

 

 

 

-

 

 

 

247,500

 

 

 

2.9

 

 

$ 10.28

 

 

 

-

 

 

 

 

 

7,862,722

 

 

 

6.1

 

 

$ 3.93

 

 

$ 35,935

 

 

 

5,521,312

 

 

 

4.9

 

 

$ 4.54

 

 

$ 4,831

 

  


During the years ended December 31, 2021 and 2020, the Company granted Restricted Stock Units (“RSUs”) representing an aggregate of 4,384,744 and 361,000 shares, respectively, to certain management employees of the Company and, during 2020, to members of its Board of Directors (the “Board”). Except for the RSUs granted under the Company’s retention incentive program discussed below, the RSUs generally vest annually over a period of four years for employees and semi-annually over a period of one year for directors. The RSUs granted during the year ended December 31, 2021 include 3,832,500 shares granted under a retention incentive program implemented by the Company for its executive management and certain employees (see Note 10), whereby the Company issued an aggregate of 2,685,000 time-based RSUs and 1,147,500 milestone-based RSUs. Fifty percent of the time-based RSUs granted under the retention incentive program vest on December 31, 2022, with the remainder vesting in quarterly installments through December 31, 2024. The milestone-based RSUs will vest upon achievement of the applicable milestone, with each milestone required to be achieved on or prior to December 31, 2022.

The milestones required to be achieved in order for the milestone-based RSUs to vest were determined by the Board and are consistent with the 2022 operating plan approved by the Board. The Company will periodically assess the probability of vesting for each milestone-based RSU and will adjust compensation expense based on its probability assessment. In connection with the completion of the refinancing of the Company’s senior credit facility on March 23, 2022 (see Note 17), 254,745 milestone-based RSUs vested.

During the year ended December 31, 2021, 92,750 shares vested in connection with grants of RSUs. With respect to these vested RSUs, 27,850 shares valued at approximately $62,000 were withheld by the Company to cover employees’ tax liabilities. These shares have been retired by the Company and were no longer outstanding as of December 31, 2021. A summary of the Company’s unvested RSU activity and related information is as follows:


 

 

Shares

   

Weighted

Average Grant

Date Fair Value

 

Balance at December 31, 2019

    -     $ -  

Granted

    361,000     $ 2.82  

Vested

    (15,000 )   $ 2.92  

Forfeited

    (20,000 )   $ 2.83  
Balance at December 31, 2020     326,000     $ 2.81  
Granted
    4,384,744     $ 1.30  
Vested
    (92,750 )   $ 2.82  
Forfeited
    (132,861 )   $ 2.51  

Balance at December 31, 2021

    4,485,133
    $ 1.34
 

As of December 31, 2021, the Company had $5.1 million of unrecognized compensation expense related to unvested RSUs granted under the Company’s equity incentive plan, which is expected to be recognized over a weighted-average period of 2.6 years.


Total stock-based compensation expense for all awards granted under the Company’s equity incentive plan for the years ended December 31, 2021 and 2020 was as follows:

 

 

 

2021

   

2020

 

Research and development

  $ 153,924     $ 471,146  

Plasma center operating expenses

    60,257       33,464  

Selling, general and administrative

    2,958,008       2,107,577  

Cost of product revenue

    316,064       242,935  

Total stock-based compensation expense

  $ 3,488,253     $ 2,855,122