Note 5 - Stockholders' Equity |
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| Stockholders' Equity | 5. Stockholders’ Equity Classes of Stock Common Stock On June 10, 2026, the Company held its annual meeting of stockholders at which time the Company's stockholders approved an amendment to the Company's Amended and Restated Certificate of Incorporation to increase the total number of authorized shares of the Company's $0.01 par value common stock from 300,000,000 shares to 450,000,000 shares. The Company subsequently amended its Amended and Restated Certificate of Incorporation to reflect the increase. As of June 30, 2026, the Company was authorized to issue 450,000,000 shares of $0.01 par value common stock. Each share of common stock entitles the holder thereof to one vote on each matter submitted to a vote at a meeting of stockholders. Preferred Stock As of June 30, 2026, the Company was authorized to issue 7,000,000 shares of $0.01 par value preferred stock of which 1,000,000 shares have been designated as Series A 4.5% Convertible Preferred Stock ("Series A Convertible Preferred Stock"), of which 200,000 are issued and outstanding and are convertible into an aggregate of 8 shares of the Company's common stock. Recent Equity Transactions Common Stock Purchase Agreement On March 27, 2026, the Company issued and sold 1,536,885 shares of its common stock, par value $0.01 per share, to an investor for a total purchase price of $3.0 million, or $1.952 per share, pursuant to a common stock purchase agreement, dated March 27, 2026, by and between the Company and the investor. The Company recognized net equity issuance costs of approximately $28,000 against the additional paid-in capital recognized in this transaction. Crohn's and Colitis Foundation Research Program Funding Agreement The CCF has agreed to provide up to a $0.5 million investment to support the Company’s Phase 1b research program related to PALI-2108. In the first quarter of 2026, the CCF settled CCF Milestone 1 in the amount of $250,000. Pursuant to the CCF Agreement, for each CCF Milestone payment received, within 30 days the Company must issue shares of its common stock equal to the CCF Milestone Amount divided by 80% of the closing price of the Company’s common stock on the date of the respective milestone's cash receipt date. Accordingly, in the first quarter of 2026, the Company issued 191,717 shares of its common stock, par value $0.01 per share, to the CCF. As of June 30, 2026, neither CCF Milestone 2 nor CCF Milestone 3 has been met. October 2025 Offering On October 2, 2025, the Company completed an underwritten offering of common stock and pre-funded warrants to purchase common stock for net proceeds of $127.6 million, consisting of gross cash proceeds of $138.0 million less underwriting discounts and commissions and other cash equity issuance costs of approximately $10.4 million. Common Stock Warrants Outstanding and Warrant Activity The following table summarizes the Company's outstanding and exercisable common stock warrants as of June 30, 2026:
(1) The pre-funded common stock warrants outstanding as of June 30, 2026 have a perpetual term and are therefore excluded from the calculation of the weighted-average remaining contractual life. Of the outstanding common stock warrants, only the Series 2 Common Stock Warrants include a down round feature whereby they are subject to price reset provisions in the event future sales of the Company's securities are sold at a price per share less than the exercise price of such warrants. The following table summarizes all common stock warrant activity during the six months ended June 30, 2026:
(1) The pre-funded common stock warrants outstanding as of June 30, 2026 have a perpetual term and are therefore excluded from the calculation of the weighted-average remaining contractual life. |
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