PRIVATE PLACEMENT OPTION LIABILITY

12 Months Ended

Dec. 31, 2019

Investments, Debt and Equity Securities [Abstract]

PRIVATE PLACEMENT OPTION LIABILITY

PRIVATE PLACEMENT OPTION LIABILITY

In August 2019, the Company executed the Securities Purchase Agreement in relation to the August 2019 private placement, and received net option fee proceeds of approximately $11.2 million. Pursuant to the Securities Purchase Agreement, the Company agreed to issue, in multiple private placements, Series 2 and 3 Preferred Stock and Private Warrants upon the request of the Purchasers, contingent on the Company obtaining the Required Stockholder Approval. The Company obtained the Required Stockholder Approval in the first quarter of 2020.

The right of the Purchasers to purchase such securities will expire two and a half years after the obtaining stockholder approval for additional authorized shares or a reverse stock split, with respect to the Series 2 Preferred Stock, and three years after such stockholder approval or such reverse stock split, with respect to the Series 3 Preferred Stock, if not exercised prior to that date.

The Company determined that the option fee is a liability because it can be exercised for Series 2 and 3 Preferred Stock that are puttable by the holder outside the control of the Company. The Company recorded the net proceeds of the Option Fee as a liability which approximates the fair value at December 31, 2019.

PRIVATE PLACEMENT OPTION LIABILITY

In August 2019, the Company executed the Securities Purchase Agreement in relation to the August 2019 private placement, and received net option fee proceeds of approximately $11.2 million. Pursuant to the Securities Purchase Agreement, the Company agreed to issue, in multiple private placements, Series 2 and 3 Preferred Stock and Private Warrants upon the request of the Purchasers, contingent on the Company obtaining the Required Stockholder Approval. The Company obtained the Required Stockholder Approval in the first quarter of 2020.

The right of the Purchasers to purchase such securities will expire two and a half years after the obtaining stockholder approval for additional authorized shares or a reverse stock split, with respect to the Series 2 Preferred Stock, and three years after such stockholder approval or such reverse stock split, with respect to the Series 3 Preferred Stock, if not exercised prior to that date.

The Company determined that the option fee is a liability because it can be exercised for Series 2 and 3 Preferred Stock that are puttable by the holder outside the control of the Company. The Company recorded the net proceeds of the Option Fee as a liability which approximates the fair value at December 31, 2019.