XML 20 R9.htm IDEA: XBRL DOCUMENT
v3.21.2

Common Stock and Warrants | 6 Months Ended
--- | ---
Jun. 30, 2021
Equity [Abstract] |
Common Stock and Warrants | 3. COMMON STOCK AND WARRANTS The Company’s authorized capital stock pursuant to its Delaware charter consists of 150,000,000 authorized shares of Class A common stock, at a par value per share of $0.001 and 10,000,000 authorized shares of preferred stock at a par value per share of $0.001. Holders of common stock are entitled to vote at any meeting of the Company’s stockholders on the basis of one vote per share of common stock owned as of the record date of such meeting. Each share of common stock entitles the holder to receive dividends, if any, as declared by the Company’s Board of Directors. No dividends have been declared since inception of the Company through June 30, 2021. In the event of a liquidation, dissolution or winding-up of the Company, other distribution of assets of the Company among its stockholders for the purposes of winding-up its affairs or upon a reduction of capital, the stockholders shall, share equally, share for share, in the remaining assets and property of the Company. On April 13, 2018, the Company issued 61,197 shares of its common stock and warrants to purchase 61,197 shares of the Company’s common stock in an underwritten public offering at a price of $261.45 per share and accompanying warrant. On April 24, 2018, the Company closed on the sale of an additional 9,179 shares of its common stock and warrants to purchase 9,179 shares of the Company’s common stock pursuant to the exercise of the underwriters’ over-allotment option (collectively the “April 2018 Offering”). The Company received net proceeds of $16.3 million from the April 2018 Offering. The fair value of these warrants at issuance was approximately $7.4 million. Each warrant issued in connection with the April 2018 Offering entitled the holder to acquire one additional share of common stock at an exercise price of CAD$428.75 per share on or before April 10, 2021. Pursuant to the guidance of ASC 815 Derivatives and Hedging, the Company determined that warrants issued in connection with the April 2018 Offering should be accounted for as liabilities as the ability to maintain an effective registration was outside of the Company’s control and that it might be required to settle the exercise of the warrants in cash and because the exercise prices of these warrants were in a currency other than the Company’s functional currency. Consequently, the Company determined the fair value of each warrant issuance using the Black-Scholes option pricing model, with the remainder of the proceeds allocated to the common shares. As of June 30, 2021, 2,025 warrants had been exercised, all during 2018, for gross proceeds of CAD$0.9 million. The remaining 68,351 warrants expired in April 2021. The following table summarizes the weighted average assumptions used in estimating the fair value of the warrants issued in the April 2018 Offering using the Black-Scholes option pricing model as of the date of the initial closing of the offering and the date of the closing of the over-allotment option.
|  | April 24, 2018 |  |  | April 13, 2018 |
Stock price |  | CAD$ 376.60 |  |  | CAD$ 344.75 |
Exercise price |  | CAD$ 428.75 |  |  | CAD$ 428.75 |
Warrant term |  | 3.00 years |  |  | 3.00 years |
Expected volatility |  |  | 64.49 | % |  |  | 64.20 | %
Risk-free interest rate |  |  | 2.02 | % |  |  | 1.99 | %
Dividend rate |  |  | 0.00 | % |  |  | 0.00 | %
On January 27, 2020, the Company filed a Form S-3 shelf registration under the Securities Act which was declared effective by the SEC on February 6, 2020 (the “2020 Shelf”). In conjunction with the 2020 Shelf, on January 27, 2020, the Company entered into an At The Market Offering Agreement (the “2020 ATM”) with H.C. Wainwright & Co., LLC (“Wainwright”) under which the Company may offer and sell, from time to time at its sole discretion, to or through Wainwright, acting as agent and/or principal, shares of its common stock having an aggregate offering price of up to $11.34 million, which, in March 2020, was subsequently reduced to $9.15 million, including the shares previously sold under the 2020 ATM. For the six months ended June 30, 2020, under the 2020 ATM, the Company sold and issued 232,526 shares of its common stock with an aggregated market value of $5.0 million at an average price of $21.68 per share and paid Wainwright a sales commission of approximately $181 thousand related to those shares. The Company terminated the 2020 ATM effective November 25, 2020. On March 20, 2020, the Company, in a registered direct offering, issued an aggregate of 178,776 shares of its common stock at a price of $12.25 per share. Additionally, the Company issued unregistered warrants in a concurrent private placement to purchase up to 178,776 shares of its common stock at an exercise price of $16.10 per share. Gross proceeds from the offering (the “March 2020 Offering”) were approximately $2.2 million. The underwriting discounts and commissions and offering expenses of $0.3 million were recorded to share issuance costs. Each warrant issued in connection with the March 2020 Offering entitles the holder to acquire one additional share of common stock at an exercise price of $16.10 per share, which became exercisable on September 20, 2020 and will expire on March 20, 2025. Pursuant to the guidance of ASC 480 Distinguishing Liabilities from Equity and ASC 815 Derivatives and Hedging, the Company has determined that warrants issued in connection with the March 2020 Offering should be classified as equity as partial cash settlement under certain circumstances and provisions related to market volatility did not preclude equity classification. The relative fair value of these warrants at issuance was approximately $0.8 million and was included in additional paid-in capital. As of June 30, 2021, 81,633 warrants had been exercised, all during the first quarter of 2021, for gross proceeds of $1.3 million. The following table summarizes the weighted average assumptions used in estimating the fair value of the warrants granted in the March 2020 Offering using the Black-Scholes option pricing model as of the date of the closing of the offering on March 20, 2020.
|  | March 20, 2020 |
Stock price |  | $ | 12.25 |
Exercise price |  | $ | 16.10 |
Warrant term |  | 5.50 years |
Expected volatility |  |  | 82.41 | %
Risk-free interest rate |  |  | 0.52 | %
Dividend rate |  |  | 0.00 | %
On October 26, 2020, the Company issued units consisting of one share and a warrant to purchase 0.50 shares of common stock, with an aggregate issuance of 187,646 shares of common stock and warrants to purchase an aggregate of 93,817 shares of common stock at a purchase price of $18.20 per unit, resulting in gross proceeds of approximately $3.4 million, excluding the proceeds, if any, that the Company may receive in the future from the exercise of the warrants (the “October 2020 Offering”). The Company incurred $0.3 million in share issuance costs, including placement agent fees. The warrants have an initial exercise price of $15.82 per share and are exercisable for a period of three years from the date of issuance. The Company also issued warrants to the placement agent to purchase 961 shares of common stock, with an exercise price of $19.775 per share. An officer of the Company and affiliates of an officer and director of the Company participated in the October 2020 Offering on the same terms and conditions as all other purchasers, except that they paid $18.354 per unit and their warrants have an exercise price of $16.1665 per share. Pursuant to the securities purchase agreement for the October 2020 Offering, if the Company issues any shares of common stock or common stock equivalents for cash consideration, indebtedness or a combination thereof, with certain exceptions, within twelve months of the closing of the October 2020 Offering, each purchaser who subscribed for at least $250,000 has the right to participate in up to such purchaser’s pro rata portion of 30% of the such subsequent financing on the same terms, conditions and price provided for in the subsequent financing. Pursuant to the guidance of ASC 480 Distinguishing Liabilities from Equity and ASC 815 Derivatives and Hedging, the Company has determined that warrants issued in connection with the October 2020 Offering should be classified as equity as partial cash settlement under certain circumstances did not preclude equity classification. The relative fair value of these warrants at issuance was approximately $0.6 million and was included in additional paid-in capital. The following table summarizes the weighted average assumptions used in estimating the fair value of the warrants granted in the October 2020 Offering using the Black-Scholes option pricing model as of the date of the closing of the offering on October 26, 2020.
|  | October 26, 2020 |
Stock price |  | $ | 15.92 |
Exercise price |  | $ | 15.92 |
Warrant term |  | 3.00 years |
Expected volatility |  |  | 80.91 | %
Risk-free interest rate |  |  | 0.18 | %
Dividend rate |  |  | 0.00 | %
On February 1, 2021, in an underwritten public offering (the “February 2021 Offering”), the Company issued 744,936 shares of common stock and warrants to purchase up to an aggregate of 372,468 shares of common stock at a purchase price of $14.82 per unit, consisting of one share and a warrant to purchase 0.50 shares of common stock. The warrants have an initial exercise price of $16.302 per share and are exercisable for a period of five years from the date of issuance. The Company also issued warrants to the underwriter to purchase 29,797 shares of common stock, with an exercise price of $18.525 per share. Net proceeds from the February 2021 Offering after underwriter’s discounts and commission and offering expenses paid by us were approximately $9.6 million. Affiliates of an officer and director participated in the February 2021 Offering on the same terms and conditions as all other purchasers. Pursuant to the guidance of ASC 480 Distinguishing Liabilities from Equity and ASC 815 Derivatives and Hedging, the Company has determined that warrants issued in connection with the February 2021 Offering should be classified as equity as partial cash settlement under certain circumstances and provisions related to market volatility did not preclude equity classification. The relative fair value of these warrants at issuance was approximately $2.6 million and was included in additional paid-in capital. As of June 30, 2021, 262 warrants had been exercised, all during the second quarter of 2021, for gross proceeds of $4 thousand. The following table summarizes the weighted average assumptions used in estimating the fair value of the warrants granted in the February 2021 Offering using the Black-Scholes option pricing model as of the date of the closing of the offering on February 1, 2021.
|  | February 1, 2021 |
Stock price |  | $ | 14.82 |
Exercise price |  | $ | 16.47 |
Warrant term |  | 5.00 years |
Expected volatility |  |  | 75.02 | %
Risk-free interest rate |  |  | 0.42 | %
Dividend rate |  |  | 0.00 | %
The following table summarizes warrants accounted for as liabilities and recorded as derivative financial instruments on the Company’s condensed consolidated balance sheets for the six months ended June 30, 2021 and 2020 (amounts in thousands):
|  | Six Months Ended June 30, |
|  | 2021 |  |  | 2020 |
Fair value of warrants at beginning of period |  | $ | — |  |  | $ | 5 |
Exercise of warrants |  |  | — |  |  |  | — |
Foreign exchange losses |  |  | — |  |  |  | — |
Change in fair value of warrants during the period |  |  | — |  |  |  | (4 | )
Fair value of warrants at end of period |  | $ | — |  |  | $ | 1 |
Prior to their expiration in April 2021, these warrants were classified as derivative financial instruments in the Company’s condensed consolidated balance sheet as of December 31, 2020 and were required to be re-measured at each reporting period, with the change in fair value recorded as a gain or loss in the change in fair value of derivative financial instruments, included in other income (expense) in the Company’s condensed consolidated statements of operations and comprehensive loss. The fair value of the warrants continued to be classified as a liability until they were exercised or expired. No warrants were included in the table for 2021 as all warrants classified as liabilities were underwater prior to expiring in April 2021. As of June 30, 2021, there are no warrants outstanding classified as derivative financial instruments. The fair value of all warrants classified as derivative financial instruments outstanding as of December 31, 2020 were estimated using the Black-Scholes option pricing model with the following weighted average assumptions:
|  | December 31, 2020 |
Stock price |  | CAD$ 17.15 |
Exercise price |  | CAD$ 428.75 |
Warrant term |  | 0.27 years |
Expected volatility |  |  | 64.48 | %
Risk-free interest rate |  |  | 0.06 | %
Dividend rate |  |  | 0.00 | %
The following is a summary of the Company’s warrant activity during the six months ended June 30, 2021:
|  | Number of Warrants |  |  | Weighted Average Exercise Price |
|  | CAD |  |  | US |  |  | CAD$ |  |  | USD$ |
Outstanding as of December 31, 2020 |  |  | 68,351 |  |  |  | 273,554 |  |  | $ | 428.75 |  |  | $ | 16.04 |
Granted |  |  | — |  |  |  | 402,265 |  |  |  | — |  |  |  | 16.47 |
Cancelled/Expired |  |  | (68,351 | ) |  |  | — |  |  |  | 428.75 |  |  |  | — |
Exercised |  |  | — |  |  |  | (81,895 | ) |  |  | — |  |  |  | 16.10 |
Outstanding as of June 30, 2021 |  |  | — |  |  |  | 593,924 |  |  | $ | — |  |  | $ | 16.32 |
The Company’s warrants outstanding and exercisable as of June 30, 2021 were as follows:
Number of Warrants Outstanding |  |  | Exercise Price |  | Expiration Date
| 97,143 |  |  | USD$16.10 |  | March 20, 2025
| 17,431 |  |  | USD$16.1665 |  | October 26, 2023
| 76,386 |  |  | USD$15.82 |  | October 26, 2023
| 961 |  |  | USD$19.775 |  | October 26, 2023
| 372,206 |  |  | USD$16.302 |  | February 1, 2026
| 29,797 |  |  | USD$18.525 |  | February 1, 2026
| 593,924 |  |  |  |  |

X
- References No definition available. + Details
Name: | us-gaap_EquityAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(e)(1)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.3-04) -URI http://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -URI http://asc.fasb.org/topic&trid=2208762 + Details
Name: | us-gaap_StockholdersEquityNoteDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration