v3.22.2.2
Stockholders' Equity
 9 Months Ended
Sep. 30, 2022
Equity [Abstract]  
Stockholders' Equity Stockholders’ Equity
Common Stock

As of September 30, 2022, there were 16,840,261 shares of common stock outstanding. Each share of common stock is entitled to one vote. The holders of the common stock are also entitled to receive dividends whenever funds are legally available and when declared by our Board of Directors.

Reverse Stock Split

On June 24, 2022, we filed a Certificate of Amendment of Amended and Restated Certificate of Incorporation with the Secretary of State of the state of Delaware to effect a 1-for-10 reverse stock split of our issued and outstanding common stock. The primary purpose of the reverse stock split was to raise the per share trading price of our common stock to seek to maintain the listing of our common stock on The Nasdaq Capital Market. At the effective time of the reverse stock split, 5:00 p.m. on June 28, 2022, each 10 shares of our issued and outstanding common stock were automatically combined and converted into one issued and outstanding share of common stock. All of our stock options, RSUs and warrants outstanding immediately prior to the reverse stock split, as well as the conversion ratio of our outstanding convertible preferred stock, were proportionately adjusted. All issued and outstanding common stock, options exercisable for common stock, restricted stock units, common stock issuable upon conversion of outstanding convertible preferred stock, warrants and per share amounts contained in these financial statements have been retrospectively adjusted.

2019 Equity Incentive Plan
On June 15, 2019, the Company's board of directors approved, and on August 1, 2019 the Company's stockholders approved, the Company's 2019 Equity Incentive Plan (the "2019 Plan"). The 2019 Plan is the successor to and continuation of the Company's 2012 Equity Incentive Plan. The number of shares authorized for issuance under the 2019 Plan may be increased
by (a) the shares subject to outstanding stock awards granted under the Company’s 2009 Equity Incentive Plan (the “2009 Plan”) and the Company’s 2012 Equity Incentive Plan (together the with 2009 Plan, the “Prior Plans”) that on or after the effective date of the 2019 Plan (i) expire or terminate for any reason prior to exercise or settlement; (ii) are forfeited because of the failure to meet a contingency or condition required to vest such shares or otherwise return to the Company, or (iii) are reacquired, withheld (or not issued) to satisfy a tax withholding obligation in connection with an award or to satisfy the purchase price or exercise price of a stock award. No further grants will be made under the Prior Plans. In addition, on January 22, 2020, an additional 416,686 shares of common stock became available for issuance under the 2019 Plan pursuant to the Milestone Closing (defined below) of the May 2019 SPA (defined below). Further, on January 1st of each year, for a period of not more than ten years, beginning on January 1, 2021 and continuing through January 1, 2029, the number of shares authorized for issuance under the 2019 Plan will increase by 5.0% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares as may be determined by our Board of Directors. As of September 30, 2022, 365,628 shares of common stock were available for new equity award grants under the 2019 Plan and 1,470,768 shares of common stock were reserved for issuance pursuant to equity awards outstanding under the 2019 Plan as of September 30, 2022.
2021 Inducement Plan
On November 23, 2021, our Board of Directors adopted the 2021 Inducement Plan (the “Inducement Plan”), which became effective immediately. Stockholder approval of the Inducement Plan was not required pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules. The Inducement Plan initially reserved 200,000 shares of common stock and provides for the grant of NSOs that was used exclusively for grants to individuals that were not previously employees or directors of the Company, as an inducement material to the individual’s entry into employment with the Company.
Under the Inducement Plan, options are granted with varying vesting terms, but typically vested over four years, with 25% of the total grant vesting on the first anniversary of the effective date of the option grant and the remaining grant vesting monthly thereafter over the following 36 months.
As of September 30, 2022, 160,000 shares of common stock were reserved for future issuance under the Inducement Plan and 40,000 shares of common stock were reserved for future issuance pursuant to equity awards outstanding under the Inducement Plan.
2022 Employee Stock Purchase Plan

In June 2022, our stockholders approved and we adopted the 2022 Employee Stock Purchase Plan (“2022 Purchase Plan”), which enables participants to contribute up to 15% of such participant’s eligible compensation during a defined rolling six-month periods to purchase our common stock. The purchase price of common stock under the 2022 Purchase Plan will be the lesser of: (i) 85% of the fair market value of our common stock at the inception of the enrollment period or (ii) 85% of the fair market value of our common stock at the applicable purchase date. The 2022 Purchase Plan supersedes the 2012 Employee Stock Purchase Plan, and no further offerings will be made under the 2012 Employee Stock Purchase Plan. As of September 30, 2022, a maximum of 129,107 shares of our common stock were reserved for future issuance and have been authorized for purchase under the 2022 Purchase Plan.

Private Placement of Common Stock and Non-Voting Preferred Stock

On November 24, 2021, we entered into a Securities Purchase Agreement (the "November 2021 SPA") with certain institutional and other accredited investors, including one of the Company's directors (the “2021 Purchasers”), pursuant to which we agreed to sell and issue shares of our common stock and shares of newly designated non-voting convertible preferred stock (the “2021 PIPE”).

At the closing under the November 2021 SPA that occurred on November 30, 2021 (the “2021 Closing”), we sold and issued to the 2021 Purchasers (i) 5,892,335 shares of common stock at a purchase price of $3.60 per share, and (ii) 372,572 shares of non-voting Class A-4 convertible preferred stock, in lieu of shares of common stock, at a price of $3.60 per share. Total gross proceeds from the 2021 Closing were approximately $34.6 million. Each share of non-voting Class A-4 convertible preferred stock is convertible into one share of common stock, subject to certain beneficial ownership conversion limitations. An aggregate of 222,222 shares of common stock were purchased for $0.8 million by a director of the Company at the 2021 Closing.
We evaluated the non-voting Class A-4 convertible preferred stock sold in the 2021 PIPE under ASC 480, Distinguishing Liabilities from Equity, and ASC 815, Derivatives and Hedging, and determined permanent equity treatment was appropriate for these freestanding financial instruments and there were no embedded features that required bifurcation.

The following table summarizes preferred stock conversions and warrant exercises (and the related impact on common stock) for the three and nine months ended September 30, 2022 and 2021 (in thousands):
Class A-1 Convertible Preferred StockClass A-2 Convertible Preferred StockClass A-3 Convertible Preferred StockClass A-4 Convertible Preferred StockCommon Stock WarrantsCommon Stock
Balance at December 31, 2021257 1,331 259 3,726 6,187 
Conversions/Exercises— — — — — — 
Balance at March 31, 2022257 1,331 259 3,726 6,187 
Conversions/Exercises— — — — — — 
Balance at June 30, 2022257 1,331 259 3,726 6,187 
Conversions/Exercises— — — — — — 
Balance at September 30, 2022257 1,331 259 3,726 6,187 
Balance at December 31, 2020257 1,416 259 — 6,604 
Conversions/Exercises— (78)— — (392)320 
Balance at March 31, 2021257 1,338 259 — 6,212 
Conversions/Exercises— (7)— — (25)32 
Balance at June 30, 2021257 1,331 259 — 6,187 
Conversions/Exercises— — — — — — 
Balance at September 30, 2021257 1,331 259 — 6,187 

ATM Offering

On December 12, 2018, we entered into a Common Stock Sales Agreement (the “Stock Sales Agreement”) with H.C. Wainwright & Co., LLC (“HCW”), pursuant to which we may sell and issue shares of our common stock from time to time through HCW, as our sales agent (the “ATM Offering”). We have no obligation to sell any shares of common stock in the ATM Offering, and may at any time suspend offers under the Stock Sales Agreement or terminate the Stock Sales Agreement. Subject to the terms and conditions of the Stock Sales Agreement, HCW will use its commercially reasonable efforts to sell shares of our common stock from time to time based upon our instructions (including any price, time or size limits or other parameters or conditions that we may impose, subject to certain restrictions). We pay HCW a commission of 3.0% of the gross sales price of any shares sold under the Stock Sales Agreement. On August 10, 2021, we increased the amount of common stock available for sale in the ATM Offering under the Stock Sales Agreement to $50.0 million.
A total of 2,205,100 shares were sold and settled for proceeds of $4.5 million (net of $0.1 million in offering costs) under the ATM Offering during the three and nine months ended September 30, 2022. No shares were sold under the ATM Offering during the three months ended September 30, 2021. A total of 16,017,131 shares were sold and settled for proceeds of $20.5 million (net of $0.8 million in offering costs) under the ATM Offering during the nine months ended September 30, 2021. At September 30, 2022, approximately $45.4 million remained eligible to be sold in the ATM Offering, subject to compliance with the rules applicable to sales on Form S-3.
Shares Reserved for Future Issuance
The following shares of common stock were reserved for future issuance as of September 30, 2022 (in thousands):
 
Class A-1 convertible preferred stock outstanding (as-converted)257 
Class A-2 convertible preferred stock outstanding (as-converted)1,331 
Class A-3 convertible preferred stock outstanding (as-converted)259 
Class A-4 convertible preferred stock outstanding (as-converted)3,726 
2019 PIPE Initial Closing warrants1,278 
2019 PIPE Milestone Closing warrants3,059 
2020 PIPE warrants1,849 
Common stock options outstanding1,386 
RSUs outstanding85 
Common stock available for future grant under the 2019 Equity Incentive Plan365 
Common stock available for future grant under the 2021 Inducement Plan160 
2022 Employee Stock Purchase Plan129 
Total common shares reserved for future issuance13,884 
The following table summarizes our stock option and RSU (together Stock Awards) activity under all equity incentive plans for the nine months ended September 30, 2022 (shares in thousands): 
Number of
options		Weighted
average
exercise
price		Number of
RSUs		Weighted average grant date fair value
Stock Awards outstanding at December 31, 2021866 $11.72 40 $9.50 
Granted562 $2.60 85 $2.57 
Exercised (options) or Vested (RSUs)— $— (36)$9.50 
Canceled/forfeited/expired(42)$26.10 (4)$9.50 
Stock Awards outstanding at September 30, 20221,386 $7.58 85 $2.57 

Stock-Based Compensation
The following table summarizes the weighted average assumptions used to estimate the fair value of stock options and performance stock awards granted to employees under our 2019 Equity Incentive Plan, 2021 Inducement Plan and the shares purchasable under our Employee Stock Purchase Plans during the periods presented:
 
 Three months ended
September 30,		Nine months ended
September 30,
 2022202120222021
Stock options
    Risk-free interest rate3.1 %0.9 %2.0 %1.0 %
    Volatility97.5 %96.0 %96.1 %95.8 %
    Dividend yield — — — — 
    Expected term (years)6.16.16.16.1
Performance stock options
    Risk-free interest rate— — — 1.0 %
    Volatility— — — 95.7 %
    Dividend yield— — — — 
    Expected term (years)0006.1
Employee stock purchase plan shares
    Risk-free interest rate1.7 %0.1 %0.9 %0.1 %
    Volatility105.9 %103.1 %99.3 %104.4 %
    Dividend yield— — — — 
    Expected term (years)0.50.50.50.5
The following table summarizes the allocation of our stock-based compensation expense for all stock awards during the periods presented (in thousands): 
 Three months ended
September 30,		Nine months ended
September 30,
 2022202120222021
Research and development$56 $277 $425 $687 
General and administrative304 530 1,355 1,565 
Total$360 $807 $1,780 $2,252