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Subsequent Events
12 Months Ended
Dec. 31, 2019
Subsequent Events [Abstract]  
Subsequent Events
Subsequent Events
Reedy Creek
In accordance with the Purchase Agreement with Reedy Creek, Reedy Creek was to provide $10,000 of additional funding contingent upon the Company’s achievement of the primary endpoints in each of the two SB206 clinical trials no later than March 31, 2020. On January 2, 2020, the Company announced top-line results from two pivotal Phase 3 clinical trials of SB206 for the treatment of molluscum contagiosum. SB206 did not achieve statistically significant results in the primary endpoint in both trials, which was the complete clearance of all molluscum lesions at Week 12. Based on such results, the Company understands that Reedy Creek will not be providing the Company with the contingent $10,000 of additional funding.
Chief Executive Officer Transition
In December 2019 the Company announced that Paula Brown Stafford, the Company’s President and Chief Operating Officer, would succeed G. Kelly Martin as CEO, effective February 2, 2020. Mr. Martin had a fixed term employment contract that expired on February 1, 2020, and completed his service as CEO after fulfilling his term. Mr. Martin also stepped off the Board of Directors, effective February 3, 2020. Ms. Stafford remains a member of the Board of Directors.
Board of Directors
On January 29, 2020, Dr. Eugene Sun, one of the members of the Company’s board of directors, notified the Company of his resignation from the board and any committees thereof, effective January 29, 2020.
Stock Appreciation Rights
As described in Note 11—Share-Based Compensation, on August 8, 2018, the Company entered into the Martin Employment Agreement with G. Kelly Martin. The Martin Employment Agreement provided for 1,000,000 SARs and entitled Mr. Martin to a payment (in cash, shares of common stock or a combination of both) equal to the fair market value of one share of the Company’s common stock on the date of exercise less the exercise price of $3.80 per share. The SARs were to be deemed automatically exercised and settled as of February 1, 2020, provided Mr. Martin remained continuously employed with the Company through such date unless vesting was otherwise expressly accelerated pursuant to the Martin SAR Award. The SARs vested in full on February 1, 2020. On February 1, 2020, the fair market value of our common stock was $0.52 per share, and as such, the SARs expired unexercised and 1,000,000 shares became available to be granted under the 2016 Plan.
Effective December 17, 2019, the Company entered into an amended and restated employment agreement with Paula Brown Stafford, or the Amended and Restated Stafford Employment Agreement. On January 6, 2020, following the release of top-line results of the Company’s Phase 3 molluscum clinical program as provided in the Amended and Restated Stafford Employment Agreement, 600,000 SARs were granted to Ms. Stafford with an exercise price of $0.82 per share (the fair market value of the Company’s common stock on the grant date) and with a ten year term (the “Stafford SAR Award”). The Stafford SAR Award was granted on a contingent basis and would have been considered irrevocably forfeited and voided in full if sufficient shares of the Company’s common stock were not available under the 2016 Plan or if the Company failed to obtain stockholder approval for amendments to the 2016 Plan at the next annual stockholders’ meeting to provide sufficient shares for the Stafford SAR Award. Such shares became available under the 2016 Plan on February 1, 2020, and the SARs were no longer considered granted on a contingent basis.
Workforce Reduction
As part of a strategic objective to reduce the Company’s costs related to internal resources, facilities, and infrastructure capabilities, the Company took actions in February 2020 that are intended to reduce the Company’s internal resources from a total of 42 employees as of December 31, 2019 to an expected total of 28 employees as of April 1, 2020.
Equity Compensation Grant
On February 13, 2020, the Company issued 383,000 stock options from the 2016 Plan, (the “Retention Grants”). These Retention Grants were issued to certain employees, vest quarterly and will be fully vested on December 31, 2020, provided that the grantee remains an employee or consultant to the Company as of each vesting date.

Women’s Health Business Unit
In February 2020, following the successful progression of the Company’s Phase 1 WH602 program, the Company was awarded a Phase 2 federal grant of approximately $1.0 million from the NIH that will enable the conduct of IND-enabling toxicology and pharmacology studies and other preclinical activity with respect to WH602. These funds will be received by the Company in the form of periodic cost reimbursements as the underlying research and development activities are performed. The Company may be eligible to receive an additional $0.5 million in funding as part of this Phase 2 grant, subject to availability of NIH funds and satisfactory progress of the project during the initial 12-month term.
Continued Listing Standard
On February 19, 2020, the Company received notice from the staff of the Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that, for the last 30 consecutive business days, the market value of the Company’s listed securities has been below the minimum $50.0 million requirement for continued inclusion on The Nasdaq Global Market pursuant to Nasdaq Listing Rule 5450(b)(2)(A). The staff also noted that the Company did not meet alternative requirements for satisfying continued listing criteria found in Nasdaq Listing Rule 5450(b)(3)(A). The Company has 180 calendar days, or until August 16, 2020, to regain compliance with the market value of listed securities requirement. If, at any time before August 16, 2020, the market value of the Company’s listed securities closes at $50.0 million or more for a minimum of 10 consecutive business days, Nasdaq will provide written notification to the Company that it complies with the market value of listed securities requirement.
On February 19, 2020, the Company also received notice from the staff of Nasdaq notifying the Company that, for the last 30 consecutive business days, the minimum bid price of the Company’s common stock has not exceeded $1.00 per share and that the Company was therefore not in compliance with the minimum bid price requirement under Nasdaq Listing Rule 5450(a)(1). The Company has 180 calendar days, or until August 16, 2020, to regain compliance with the minimum bid price requirement. To regain compliance, the closing bid price of the common stock must meet or exceed $1.00 per share for a minimum of 10 consecutive business days prior to August 16, 2020. The Company intends to continue to monitor the bid price levels for the common stock, and will consider appropriate alternatives to achieve compliance within the 180-day compliance period (or such subsequent date if the compliance period is extended).