STOCKHOLDERS' EQUITY

12 Months Ended

Dec. 31, 2023

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, 2023 and 2022.

Common Stock

As of December 31, 2023 and 2022, the Company was authorized to issue 300,000,000 shares of its common stock, $0.0001 par value per share, and 226,063,032 and 221,816,930 shares of common stock were outstanding as of December 31, 2023 and 2022, 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, 31,033,333 shares of common stock were available for issuance as of December 31, 2023.

On December 9, 2022, the Company completed an underwritten public offering whereby the Company issued 24,125,873 shares of its common stock. Net proceeds after underwriting discounts and expenses associated with the offering were approximately $64.6 million and were used to accelerate commercialization and production activities, complete plasma center buildouts and obtain FDA approvals, to conclude post‑FDA marketing approval research and development projects, and for working capital, capital expenditures and general corporate purposes.

During the year ended December 31, 2022, outstanding stock options aggregating to 68,679 shares of common stock were exercised, and the Company received net proceeds from the exercises of approximately $0.2 million.

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 were used 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, to expand the Company’s plasma collection facility network, to scale up the manufacturing capacity of the Boca Facility and make continuous improvements in order to adhere to cGMP compliance, to explore business development opportunities and 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, working capital, capital expenditures, expansion and resources for commercialization activities, and other potential research and development and business opportunities. The Company currently has approximately $42.8 million of shares available to sell under the Distribution Agreement. There were no sales under the Distribution Agreement during the year ended December 31, 2022. 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. The Sale Agreement was terminated on August 31, 2021. 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.

Warrants 

On June 16, 2023, various entities affiliated with Hayfin exercised 3,388,686 Hayfin Warrants in a cashless exercise transaction resulting in the Company issuing 1,967,847 shares of its common stock to such entities. On May 1, 2023 the Company issued the Hayfin Second Amendment Warrants (see Note 7), which were valued at $5.6 million using the Black-Scholes option-pricing model assuming an expected term of seven years, a volatility of 67.8%, a dividend yield of 0% and a risk-free rate of interest of 3.62%.

On March 23, 2022, the Company issued the Hayfin Warrants, whereby affiliates of Hayfin may purchase an aggregate of 9,103,047 shares of common stock at an exercise price of $1.6478 per share (see Note 7). The Hayfin Warrants were valued at $9.6 million, using the Black-Scholes option pricing model assuming an expected term of 7 years, a volatility of 68.1%, a dividend yield of 0% and a risk-free interest rate of 2.36%.

During the year ended December 31, 2022, warrants to purchase 106,059 shares of common stock that had been issued to former noteholders of the Company expired. At December 31, 2023 and 2022, the Company had outstanding warrants to purchase an aggregate of 12,502,906 and 13,525,148 shares, respectively, of common stock, with a weighted average exercise price of $2.32 and $1.99 per share, respectively, and expiration dates ranging between May 2023 and December 2030. The following table summarizes information about warrants outstanding as of December 31, 2023, 2022 and 2021:

	Shares			Weighted Average Exercise Price
Warrants outstanding at December 31, 2020		4,528,160		$	2.82
Expired		-		$	-
Granted		-		$	-
Exercised		-		$	-
Warrants outstanding at December 31, 2021		4,528,160		$	2.82
Expired		(106,059	)	$	8.23
Granted		9,103,047		$	1.65
Exercised		-		$	-
Warrants outstanding at December 31, 2022		13,525,148		$	1.99
Expired		(24,800	)	$	6.37
Granted		2,391,244		$	3.26
Exercised		(3,388,686	)	$	1.65
Warrants outstanding at December 31, 2023		12,502,906		$	2.32

Equity Incentive Plans

From time to time the Company granted 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 Company’s Board of Directors (the “Board”) on March 15, 2017 and by the Company’s stockholders on May 25, 2017.  The maximum number of shares that were reserved for grant under the 2014 Plan was: (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, 2022 and 2021, the Company granted options to purchase an aggregate of 1,194,032 and 1,895,550 shares of common stock, respectively, to its directors and employees under the 2014 Plan.

On June 21, 2022, the Company’s stockholders approved the ADMA Biologics, Inc. 2022 Compensation Plan (the “2022 Equity Plan”).  Approval of the 2022 Equity Plan resulted in approximately 18 million additional shares of the Company’s common stock being reserved for future awards. The 2022 Equity 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. Any options granted under the 2022 Equity 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.

For the year ended December 31, 2023, the Company granted options to purchase an aggregate of 1,826,380 shares of common stock to employees and directors under the 2022 Equity Plan. Also during the year ended December 31, 2023, options to purchase 3,814,122 shares of common stock were exercised, for which 2,109,722 shares were withheld to cover the aggregate exercise prices and 259,867 shares were withheld to cover payroll taxes, and the Company received aggregate net exercise proceeds of $1.1 million.

The fair value of stock options granted was determined on the date of grant using the Black-Scholes model. The Black-Scholes option pricing 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, 2023, 2022 and 2021, 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, 2023, 2022 and 2021 were determined using the Black-Scholes option pricing model with the following assumptions:

	Years Ended
	December 31, 2023			December 31, 2022			December 31, 2021
Expected term	5.5-6.3 years			5.5-6.3 years			5.5-6.3 years
Volatility		68	%		68	%		68-70	%
Dividend yield		0.0			0.0			0.0
Risk-free interest rate		4.20-4.62	%		1.72-1.73	%		0.80-1.27	%

The following table summarizes information about stock options outstanding as of December 31, 2023, 2022 and 2021:

	Shares			Weighted Average Exercise Price
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
Forfeited		(31,540	)	$	2.37
Expired		(700,324	)	$	6.86
Granted		1,194,032		$	1.67
Exercised		(68,679	)	$	2.55
Options outstanding, vested and expected to vest at December 31, 2022		8,256,211		$	3.37
Forfeited		(99,345	)	$	2.73
Expired		(262,940	)	$	6.42
Granted		1,826,380		$	3.36
Exercised		(3,814,122	)	$	3.15
Options outstanding, vested and expected to vest at December 31, 2023		5,906,184		$	3.38
Options exercisable		3,410,131		$	3.79

As of December 31, 2023, the Company had $3.8 million of unrecognized compensation expense related to stock options granted under the Company’s equity incentive plans, which is expected to be recognized over a weighted-average period of 2.6 years. The weighted average remaining contractual term of stock options outstanding and expected to vest at December 31, 2023 is 6.6 years. The weighted average remaining contractual term of stock options exercisable at December 31, 2023 is 5.2 years.The following table summarizes additional information regarding outstanding and exercisable options under the stock option plans at December 31, 2023:

	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 ($000’s)		Options Outstanding		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Aggregate Intrinsic Value ($000’s)
$1.10 - $1.67		1,175,410		7.7	$	1.60	$	3,428		590,275		7.3	$	1.56	$	1,748
$1.73 - $2.60		1,028,392		6.6	$	2.33		2,253		712,704		6.4	$	2.34		1,551
$2.67 - $4.01		2,905,506		7.4	$	3.41		3,211		1,310,276		5.3	$	3.49		1,343
$4.01 - $6.02		383,535		3.5	$	5.09		22		383,535		3.5	$	5.09		22
$6.26 - $9.39		279,841		1.1	$	8.48		-		279,841		1.1	$	8.48		-
$10.80 - $16.20		133,500		1.1	$	10.80		-		133,500		1.1	$	10.80		-
		5,906,184		6.6	$	3.38	$	8,914		3,410,131		5.2	$	3.79	$	4,664

During the years ended December 31, 2023, 2022 and 2021, the Company granted  RSUs representing an aggregate of 3,389,760, 1,174,266 and 4,384,744 shares, respectively, to certain employees of the Company and to members of 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 vested on December 31, 2022, with the remainder vesting in quarterly installments through December 31, 2024. The milestone-based RSUs vested upon achievement of the applicable milestone, and all of the milestone-based RSUs vested during the year ended December 31, 2022. The milestones required to be achieved in order for the milestone-based RSUs to vest were determined by the Board and were consistent with the 2022 operating plan approved by the Board.

During the years ended December 31, 2023, 2022 and 2021, 1,199,445, 2,727,412 and 92,750 shares, respectively, vested in connection with grants of RSUs. With respect to RSUs vested during the year ended December 31, 2023, 365,722 shares valued at approximately $1.3 million were withheld by the Company to cover employees’ tax liabilities. With respect to the RSUs vested during the year ended December 31, 2022, 918,851 shares valued at approximately $2.9 million were withheld by the Company to cover employees’ tax liabilities. For the RSUs vested during the year ended December 31, 2021, 27,850 shares valued at approximately $62,000 were withheld by the Company to cover employees’ tax liabilities. All of these shares have been retired by the Company or were otherwise no longer outstanding as of December 31, 2023. 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, 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
Granted		1,174,266		$	1.74
Vested		(2,727,412	)	$	1.25
Forfeited		(65,000	)	$	1.40
Balance at December 31, 2022		2,866,987		$	1.59
Granted		3,389,760		$	3.42
Vested		(1,199,445	)	$	1.63
Forfeited		(400,005	)	$	2.71
Balance at December 31, 2023		4,657,297		$	2.81

As of December 31, 2023, the Company had $10.4 million of unrecognized compensation expense related to unvested RSUs granted under the Company’s equity incentive plans, which is expected to be recognized over a weighted-average period of 2.9 years.

Total stock-based compensation expense for all awards granted under the Company’s equity incentive plans for the years ended December 31, 2023, 2022 and 2021 was as follows (in thousands):

	2023		2022		2021
Research and development	$	40	$	19	$	154
Plasma center operating expenses		146		82		60
Selling, general and administrative		5,331		4,717		2,958
Cost of product revenue		670		397		316
Total stock-based compensation expense	$	6,187	$	5,215	$	3,488