0001553350-18-000935.txt : 20180814 0001553350-18-000935.hdr.sgml : 20180814 20180814081637 ACCESSION NUMBER: 0001553350-18-000935 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 63 CONFORMED PERIOD OF REPORT: 20180630 FILED AS OF DATE: 20180814 DATE AS OF CHANGE: 20180814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HEAT BIOLOGICS, INC. CENTRAL INDEX KEY: 0001476963 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 262844103 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-35994 FILM NUMBER: 181014396 BUSINESS ADDRESS: STREET 1: 801 CAPITOLA DRIVE CITY: DURHAM STATE: NC ZIP: 27713 BUSINESS PHONE: 919-240-7133 MAIL ADDRESS: STREET 1: 801 CAPITOLA DRIVE CITY: DURHAM STATE: NC ZIP: 27713 10-Q 1 htbx_10q.htm QUARTERLY REPORT Quarterly Report

 



 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-Q


(Mark One)

 

 


þ


 


QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the quarterly period ended June 30, 2018


OR


o


 


TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the transition period from _______________ to _______________

Commission file number: 001-35994

Heat Biologics, Inc.

(Exact name of registrant as specified in its charter)

Delaware

(State or Other Jurisdiction of

Incorporation or Organization)

26-2844103

(I.R.S. Employer

Identification No.)

 

801 Capitola Drive

Durham, NC

(Address of Principal Executive Offices)

27713

(Zip Code)

(919) 240-7133

(Registrant’s Telephone Number, including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ  No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ  No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

¨

 

Accelerated filer

¨

Non-accelerated filer

¨

 

Smaller reporting company

þ

(Do not check if smaller reporting company)

 

 

Emerging growth company

þ

If an emerging growth company indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o  No þ

As of August 10, 2018, there were 23,103,584 shares of Common Stock, $0.0002 par value per share, outstanding.

 

 




 


HEAT BIOLOGICS, INC.

TABLE OF CONTENTS

 

 

Page No.

                     

                

 

 

PART I—FINANCIAL INFORMATION

 

 

 

 

Item 1.

Financial Statements

1

 

 

 

 

Consolidated Balance Sheets as of June 30, 2018 (unaudited) and December 31, 2017

1

 

 

 

 

Consolidated Statements of Operations and Comprehensive Loss (unaudited) for the three and six months ended June 30, 2018 and June 30, 2017

2

 

 

 

 

Consolidated Statements of Stockholders’ Equity (unaudited) for the six months ended June 30, 2018

3

 

 

 

 

Consolidated Statements of Cash Flows (unaudited) for the six months ended June 30, 2018 and June 30, 2017

4

 

 

 

 

Notes to the Consolidated Financial Statements (unaudited)

5

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

18

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

24

 

 

 

Item 4.

Controls and Procedures

25

 

 

 

 

PART II—OTHER INFORMATION

 

 

 

 

Item 1.

Legal Proceedings

26

 

 

 

Item 1A.

Risk Factors

26

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

27

 

 

 

Item 3.

Defaults Upon Senior Securities

27

 

 

 

Item 4.

Mine Safety Disclosures

27

 

 

 

Item 5.

Other Information

28

 

 

 

Item 6.

Exhibits

28


SIGNATURES

29







 


FORWARD-LOOKING STATEMENTS 

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of historical facts, contained in this Quarterly Report on Form 10-Q, including statements regarding our strategy, future operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management, are forward-looking statements. The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

Forward-looking statements are not guarantees of future performance and our actual results could differ materially from the results discussed in the forward-looking statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, our ability to raise additional capital to support our clinical development program and other operations, our ability to develop products of commercial value and to identify, discover and obtain rights to additional potential product candidates, our ability to protect and maintain our intellectual property and the ability of our licensors to obtain and maintain patent protection for the technology or products that we license from them, the outcome of research and development activities, our reliance on third-parties, competitive developments, the effect of current and future legislation and regulation and regulatory actions, as well as other risks described more fully in this Quarterly Report on Form 10-Q and our other filings with the Securities and Exchange Commission (the “SEC”).  Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties, and assumptions that are difficult to predict, including those identified below, under Part II, Item 1A. “Risk Factors” and elsewhere herein and those identified under Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on March 2, 2018. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to revise or update any forward-looking statements for any reason.

As a result of these and other factors, we may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make. We do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.


NOTE REGARDING COMPANY REFERENCES

Throughout this Quarterly Report on Form 10-Q, “Heat Biologics,” “the Company,” ‘we” and “our” refer to Heat Biologics, Inc.





i



 


PART I—FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

HEAT BIOLOGICS, INC.

Consolidated Balance Sheets


 

 

June 30,

2018

 

December 31,

2017

 

 

 

(unaudited)

 

 

 

Current Assets

    

                          

    

                          

  

Cash and cash equivalents

 

$

24,660,733

 

$

9,763,067

 

Accounts receivable

 

 

14,253

 

 

14,833

 

Prepaid expenses and other current assets

 

 

4,007,815

 

 

1,967,257

 

Total Current Assets

 

 

28,682,801

 

 

11,745,157

 

 

 

 

 

 

 

 

 

Property and Equipment, net

 

 

645,734

 

 

286,891

 

 

 

 

 

 

 

 

 

Other Assets

 

 

 

 

 

 

 

Restricted cash

 

 

1,170

 

 

2,292

 

In-process R&D

 

 

5,866,000

 

 

5,866,000

 

Goodwill

 

 

2,189,338

 

 

2,189,338

 

Deposits

 

 

79,220

 

 

69,798

 

Deferred financing costs

 

 

 

 

30,000

 

Total Other Assets

 

 

8,135,728

 

 

8,157,428

 

 

 

 

 

 

 

 

 

Total Assets

 

$

37,464,263

 

$

20,189,476

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

Accounts payable

 

$

821,822

 

$

1,033,680

 

Deferred revenue

 

 

5,130,684

 

 

7,026,388

 

Accrued expenses and other liabilities

 

 

1,445,867

 

 

2,276,431

 

Total Current Liabilities

 

 

7,398,373

 

 

10,336,499

 

 

 

 

 

 

 

 

 

Long Term Liabilities

 

 

 

 

 

 

 

Other long term liabilities

 

 

156,141

 

 

160,559

 

Deferred tax liability

 

 

1,302,220

 

 

1,302,220

 

Contingent consideration

 

 

3,160,387

 

 

2,609,289

 

Total Liabilities

 

 

12,017,121

 

 

14,408,567

 

 

 

 

 

 

 

 

 

Commitments and Contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ Equity

 

 

 

 

 

 

 

Common stock, $.0002 par value; 100,000,000 shares authorized, 23,093,584 and 4,200,310 shares issued and outstanding at June 30, 2018 (unaudited) and December 31, 2017, respectively

 

 

4,619

 

 

840

 

Additional paid-in capital

 

 

103,953,477

 

 

76,382,262

 

Accumulated deficit

 

 

(76,423,163

)

 

(68,846,326

)

Accumulated other comprehensive loss

 

 

(94,754

)

 

(166,025

)

Total Stockholders’ Equity– Heat Biologics, Inc.

 

 

27,440,179

 

 

7,370,751

 

Non-Controlling Interest

 

 

(1,993,037

)

 

(1,589,842

)

Total Stockholders’ Equity

 

 

25,447,142

 

 

5,780,909

 

 

 

 

 

 

 

 

 

Total Liabilities and Stockholders’ Equity

 

$

37,464,263

 

$

20,189,476

 



See Notes to Financial Statements


1



 


HEAT BIOLOGICS, INC.

Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)


 

 

Three Months Ended,
June 30,

 

 

Six Months Ended,
June 30,

 

 

 

2018

 

2017

 

 

2018

 

2017

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Grant and licensing revenue

 

$

1,143,177

 

$

411,250

 

 

$

1,895,704

 

$

435,490

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

3,479,776

 

 

2,151,932

 

 

 

6,352,726

 

 

3,964,833

 

General and administrative

 

 

1,361,166

 

 

1,582,581

 

 

 

3,141,505

 

 

3,109,596

 

Change in fair value of contingent consideration

 

 

539,980

 

 

 

 

 

551,098

 

 

 

Total operating expenses

 

 

5,380,922

 

 

3,734,513

 

 

 

10,045,329

 

 

7,074,429

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

 

 

(4,237,745

)

 

(3,323,263

)

 

 

(8,149,625

)

 

(6,638,939

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

44,164

 

 

6,466

 

 

 

47,797

 

 

11,687

 

Other (expense) income, net

 

 

(53,224

)

 

7,716

 

 

 

121,796

 

 

77,443

 

Total non-operating income (expenses), net

 

 

(9,060

)

 

14,182

 

 

 

169,593

 

 

89,130

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

(4,246,805

)

 

(3,309,081

)

 

 

(7,980,032

)

 

(6,549,809

)

Net loss – non-controlling interest 

 

 

(196,734

)

 

(90,166

)

 

 

(403,195

)

 

(140,956

)

Net loss attributable to Heat Biologics, Inc.

 

$

(4,050,071

)

$

(3,218,915

)

 

$

(7,576,837

)

$

(6,408,853

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share attributable to Heat Biologics, Inc.—basic and diluted

 

$

(0.27

)

$

(0.91

)

 

$

(0.77

)

$

(2.06

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average number of common shares used in net loss per share attributable to common stockholders—basic and diluted

 

 

14,727,682

 

 

3,524,483

 

 

 

9,894,367

 

 

3,112,412

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

(4,246,805

)

 

(3,309,081

)

 

 

(7,980,032

)

 

(6,549,809

)

Unrealized gain /(loss) on foreign currency translation

 

 

49,946

 

 

(9,660

)

 

 

71,271

 

 

(76,035

)

Total other comprehensive loss

 

 

(4,196,859

)

 

(3,318,741

)

 

 

(7,908,761

)

 

(6,625,844

)

Comprehensive loss attributable to non-controlling interest

 

 

(196,734

)

 

(90,166

)

 

 

(403,195

)

 

(140,956

)

Comprehensive loss

 

$

(4,000,125

)

$

(3,228,575

)

 

$

(7,505,566

)

$

(6,484,888

)








See Notes to Financial Statements


2



 


HEAT BIOLOGICS INC.

Consolidated Statements of Stockholders’ Equity

(Unaudited)


 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

Total

 

 

 

 

 

Common

 

 

 

 

 

Accumulated

 

Comprehensive

 

Non-Controlling

 

 

Stockholders

 

 

 

 

 

Stock

 

 

APIC

 

 

Deficit

 

Loss

 

Interest

 

 

Equity

 

Balance at December 31, 2017

 

 

 

$

840

 

 

$

76,382,262

 

 

$

(68,846,326

)

$

(166,025

)

$

(1,589,842

)

 

$

5,780,909

 

Public offering, 14,375,000 shares, net of underwriters discount

 

 

 

 

2,875

 

 

 

20,697,122

 

 

 

 

 

 

 

 

 

 

20,699,997

 

Exercise of warrants, 3,054,667 shares

 

 

 

 

611

 

 

 

4,837,982

 

 

 

 

 

 

 

 

 

 

4,838,593

 

Issuance of common stock, 1,403,367 shares

 

 

 

 

281

 

 

 

3,573,099

 

 

 

 

 

 

 

 

 

 

3,573,380

 

Stock issuance costs

 

 

 

 

 

 

 

(2,049,096

)

 

 

 

 

 

 

 

 

 

(2,049,096

)

Stock-based compensation

 

 

 

 

12

 

 

 

512,108

 

 

 

 

 

 

 

 

 

 

512,120

 

Other comprehensive gain

 

 

 

 

 

 

 

 

 

 

 

 

71,271

 

 

 

 

 

71,271

 

Net loss

 

 

 

 

 

 

 

 

 

 

(7,576,837

)

 

 

 

(403,195

)

 

 

(7,980,032

)

Balance at June 30, 2018

 

 

 

$

4,619

 

 

$

103,953,477

 

 

$

(76,423,163

)

$

(94,754

)

$

(1,993,037

)

 

$

25,447,142

 





See Notes to Financial Statements


3



 


HEAT BIOLOGICS, INC.

Consolidated Statements of Cash Flows

(Unaudited)


 

 

Six months Ended

 

 

 

June 30

 

 

 

2018

 

2017

 

 

 

 

 

 

 

Cash Flows from Operating Activities

    

                          

    

                          

  

Net loss

 

$

(7,980,032

)

 

$

(6,549,809

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

  

 

 

 

Depreciation

 

 

108,408

 

 

 

66,671

 

Stock-based compensation

 

 

512,120

 

 

 

402,349

 

Change in fair value of contingent consideration

 

 

551,098

 

 

 

 

Increase (decrease) in cash arising from changes in assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

473

 

 

 

72,543

 

Prepaid expenses and other current assets

 

 

(2,044,397

)

 

 

68,591

 

Accounts payable

 

 

(211,858

)

 

 

(202,244

)

Deferred revenue

 

 

(1,895,704

)

 

 

1,409,212

 

Accrued expenses and other liabilities

 

 

(830,162

)

 

 

(767,418

)

Deferred financing costs

 

 

30,000

 

 

 

 

Other long term liabilities

 

 

(4,418

)

 

 

(21,816

)

Deposits

 

 

(9,422

)

 

 

 

Net Cash Used in Operating Activities

 

 

(11,773,894

)

 

 

(5,521,921

)

 

 

 

 

 

 

 

 

 

Cash Flows from Investing Activities

 

 

 

 

 

 

 

 

Purchase of Pelican, net of cash acquired

 

 

 

 

 

(468,801

)

Purchase of property and equipment

 

 

(467,251

)

 

 

(15,289

)

Net Cash Used in Investing Activities

 

 

(467,251

)

 

 

(484,090

)

 

 

 

 

 

 

 

 

 

Cash Flows from Financing Activities

 

 

 

 

 

 

 

 

Proceeds from public offering, net of underwriting discounts

 

 

20,699,997

 

 

 

4,183,000

 

Proceeds from the issuance of common stock, net of commissions

 

 

3,573,380

 

 

 

2,461,880

 

Proceeds from exercise of warrants

 

 

4,838,593

 

 

 

 

Stock issuance costs

 

 

(2,049,096

)

 

 

(239,617

)

Net Cash Provided by Financing Activities

 

 

27,062,874

 

 

 

6,405,263

 

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash, cash equivalents and restricted cash

 

 

74,815

 

 

 

4,971

 

 

 

 

 

 

 

 

 

 

Net Increase in Cash, Cash Equivalents and Restricted Cash

 

 

14,896,544

 

 

 

404,223

 

 

 

 

 

 

 

 

 

 

Cash, Cash Equivalents and Restricted Cash – Beginning of Period

 

 

9,765,359

 

 

 

7,943,838

 

 

 

 

 

 

 

 

 

 

Cash, Cash Equivalents and Restricted Cash – End of Period

 

$

24,661,903

 

 

$

8,348,061

 

 

 

 

 

 

 

 

 

 

Supplemental Disclosure for Cash Flow Information

 

 

 

 

 

 

 

 

Issuance of common stock for purchase of Pelican

 

$

 

 

$

1,052,000

 






See Notes to Financial Statements


4



 


HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


1. Basis of Presentation and Significant Accounting Policies


Basis of Presentation and Principles of Consolidation


On January 19, 2018, the Company announced a reverse stock split of its shares of common stock at a ratio of one-for-ten. The reverse stock split took effect at 11 p.m. ET on January 19, 2018, and the Company’s common stock began to trade on a post-split basis at the market open on January 22, 2018. During the Company’s annual stockholders meeting held June 29, 2017, stockholders approved the Company’s reverse stock split and granted the board of directors the authority to implement and determine the exact split ratio within a specified range. When the reverse stock split became effective, every 10 shares of our issued and outstanding common stock were combined into one share of common stock. Effecting the reverse stock split reduced the number of issued and outstanding common stock from approximately 42 million shares to approximately 4.2 million. It also subsequently adjusted outstanding options issued under the Company’s equity incentive plan and outstanding warrants to purchase common stock.


The accompanying unaudited consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting. However, certain information or footnote disclosures normally included in complete financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company’s management, the unaudited consolidated financial statements in this Quarterly Report on Form 10-Q include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending December 31, 2018.


The consolidated financial statements as of and for the six months ended June 30, 2018 and 2017 included in this Quarterly Report on Form 10-Q are unaudited. The balance sheet as of December 31, 2017 is derived from the audited consolidated financial statements as of that date. The accompanying unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on March 2, 2018 (the “2017 Annual Report”).


On April 28, 2017, the Company completed the acquisition of an 80% controlling interest in Pelican Therapeutics, Inc. (“Pelican”), a related party prior to acquisition. Operations of Pelican are included in the consolidated statements of operations and comprehensive loss from the acquisition date.


The accompanying consolidated financial statements as of and for the six months ended June 30, 2018 and 2017 include the accounts of Heat Biologics, Inc. (“the Company”), and its subsidiaries, Heat Biologics I, Inc. (“Heat I”), Heat Biologics III, Inc. (“Heat III”), Heat Biologics IV, Inc. (“Heat IV”), Heat Biologics GmbH, Heat Biologics Australia Pty Ltd. and Zolovax. Additionally, as of the six months ended June 30, 2018 the accompanying consolidated financials include Pelican. The functional currency of the entities located outside the United States is the applicable local currency (the foreign entities). Assets and liabilities of the foreign entities are translated at period-end exchange rates.  Statement of operations accounts are translated at the average exchange rate during the period. The effects of foreign currency translation adjustments are included in other comprehensive loss, which is a component of accumulated other comprehensive loss in stockholders’ equity. All significant intercompany accounts and transactions have been eliminated in consolidation. At December 31, 2017 and June 30, 2018, the Company held a 92.5% controlling interest in Heat I and an 80% controlling interest in Pelican. All other subsidiaries are wholly owned. For the six months ended June 30, 2018 the Company recognized $161,994 in net loss non-controlling interest for Heat I and $241,201 in net loss non-controlling interest for Pelican. The Company accounts for its less than 100% interest in these subsidiaries in the consolidated financial statements in accordance with U.S. GAAP. Accordingly, the Company presents non-controlling interests as a component of stockholders’ equity on its consolidated balance sheets and reports non-controlling interest net loss under the heading “net loss – non-controlling interest” in the consolidated statements of operations and comprehensive loss.





5



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


The Company has an accumulated deficit of approximately $76.4 million as of June 30, 2018 and a net loss of approximately $8.0 million for the six months ended June 30, 2018 and has not generated significant revenue or positive cash flows from operations. In May 2018, through a public offering, the Company raised approximately $18.8 million, net of underwriting discounts and commissions and other estimated offering expenses, and an additional $4.8 million through the exercise of 3,054,667 warrants. On April 28, 2017, the acquisition of an 80% controlling interest in Pelican, a related party prior to acquisition, was completed. Pelican has been awarded a $15.2 million grant to fund preclinical and some clinical activities from the Cancer Prevention and Research Institute of Texas (“CPRIT”). The CPRIT grant is subject to customary CPRIT funding conditions. The Company believes the acquisition aligns its strategic focus and strengthens its position in the T-cell activation arena.


Cash Equivalents and Restricted Cash


The Company considers all highly liquid instruments with an original maturity of six months or less to be cash equivalents. Restricted cash consists of deposits held by the US Patent and Trademark Office.


Use of Estimates


The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Estimates are used for, but not limited to, useful lives of fixed assets, income taxes and stock-based compensation. Actual results may differ from those estimates.


Segments


The Company has one reportable segment - the development of immunotherapies designed to activate and expand a patient's T-cell mediated immune system against cancer.


Business Combinations


The Company accounts for acquisitions using the acquisition method of accounting, which requires that all identifiable assets acquired and liabilities assumed be recorded at their estimated fair values. The excess of the fair value of purchase consideration over the fair values of identifiable assets and liabilities is recorded as goodwill. When determining the fair values of assets acquired and liabilities assumed, management makes significant estimates and assumptions.

 

Critical estimates in valuing certain intangible assets include but are not limited to future expected cash flows from acquired patented technology. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. Other estimates associated with the accounting for acquisitions may change as additional information becomes available regarding the assets acquired and liabilities assumed (see Note 2).


Goodwill and In-Process Research and Development


The Company classifies intangible assets into three categories: (1) intangible assets with definite lives subject to amortization, (2) intangible assets with indefinite lives not subject to amortization and (3) goodwill. The Company determines the useful lives of definite-lived intangible assets after considering specific facts and circumstances related to each intangible asset. Factors the Company considers when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, and other economic facts; including competition and specific market conditions. Intangible assets that are deemed to have definite lives are amortized, primarily on a straight-line basis, over their estimated useful lives.

 



6



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


Intangible assets that are deemed to have indefinite lives, including goodwill, are reviewed for impairment annually on the anniversary of the acquisition, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test for indefinite-lived intangibles, other than goodwill, consists of a comparison of the fair value of the intangible asset with its carrying amount. If the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess. Indefinite-lived intangible assets, such as goodwill, are not amortized. The Company will qualitatively test the carrying amounts of goodwill for recoverability on an annual basis or when events or changes in circumstances indicate evidence a potential impairment exists, using a fair value-based test. No impairment existed at June 30, 2018.


In-process research and development, or IPR&D, assets are considered to be indefinite-lived until the completion or abandonment of the associated research and development projects. IPR&D assets represent the fair value assigned to technologies that the Company acquires, which at the time of acquisition have not reached technological feasibility and have no alternative future use. During the period that the assets are considered indefinite-lived, they are tested for impairment on an annual basis, or more frequently if the Company becomes aware of any events occurring or changes in circumstances that indicate that the fair value of the IPR&D assets are less than their carrying amounts. If and when development is complete, which generally occurs upon regulatory approval and the ability to commercialize products associated with the IPR&D assets, these assets are then deemed definite-lived and are amortized based on their estimated useful lives at that point in time. If development is terminated or abandoned, the Company may have a full or partial impairment charge related to the IPR&D assets, calculated as the excess of carrying value of the IPR&D assets over fair value. No impairment existed at June 30, 2018.


Contingent Consideration

 

Consideration paid in a business combination may include potential future payments that are contingent upon the acquired business achieving certain milestones in the future (“contingent consideration”). Contingent consideration liabilities are measured at their estimated fair value as of the date of acquisition, with subsequent changes in fair value recorded in the consolidated statements of operations. The Company estimates the fair value of the contingent consideration as of the acquisition date using the estimated future cash outflows based on the probability of meeting future milestones. The milestone payments will be made upon the achievement of clinical and commercialization milestones as well as single low digit royalty payments and payments upon receipt of sublicensing income. Subsequent to the date of acquisition, the Company will reassess the actual consideration earned and the probability-weighted future earn-out payments at each balance sheet date. Any adjustment to the contingent consideration liability will be recorded in the consolidated statements of operations. Contingent consideration liabilities are presented in long-term liabilities in the consolidated balance sheets (see Note 2).


Revenue Recognition


Effective January 1, 2018, the Company has adopted on a modified retrospective basis Accounting Standards Codification (ASC) Topic 606.


The Company’s sole source of revenue is grant revenue related to the CPRIT Contract, which is being accounted for under ASC 606. ASC 606 introduces a new framework for analyzing potential revenue transactions by identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations in the contract, and recognizing revenue when (or as) the Company satisfies a performance obligation.


The performance obligations of the CPRIT Contract include developing a human TNFRSF25 agonist antibody for use in cancer patients through research and development efforts and a noncommercial license from CPRIT-funded research to CPRIT and other government agencies and institutions of higher education in Texas.


Management has concluded that the license and R&D services should be combined into a single performance obligation as both are highly interdependent - a license cannot be effectively granted without the corresponding research basis and CPRIT cannot benefit from the license without the R&D services and are therefore not capable of being distinct.




7



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


The CPRIT grant covers a three-year period from June 1, 2017 through May 31, 2019, for a total grant award of up to $15.2 million. CPRIT advances grant funds upon request by the Company consistent with the agreed upon amounts and schedules as provided in the contract. The first tranche of funding of $1.8 million was received in May 2017, and a second tranche of funding of $6.5 million was received in October 2017. The next tranche of funding is expected to be requested and received in late 2018. Funds received are reflected in deferred revenue as a liability until revenue is earned.  Grant revenue is recognized when qualifying costs are incurred.


Deferred Revenue


As of June 30, 2018, deferred revenue is comprised of proceeds of $4.9 million received from CPRIT for which the costs have not been incurred or the conditions of the award have not been met and $0.2 million of grant funds received from an economic development grant agreement with the City of San Antonio (“Economic Development Grant”), for the purpose of defraying costs toward the purchase of laboratory equipment. As of June 30, 2018, the deferred revenue balance was $5.1 million with $3.4 million recognized as revenue from CPRIT since the CPRIT contract inception.


Prepaid Expenses and Other Current Assets


The Company’s prepaid expenses and other current assets consists primarily of the amount paid in advance for cGMP production of Pelican’s PTX-35 antibody and PTX-15 fusion protein, as well as Chemistry Manufacturing and Control (“CMC”) material for the Company’s clinical trial studies for HS-110.


Income Taxes


The Company accounts for income taxes using the asset and liability method, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent that utilization is not presently more likely than not.


Significant Accounting Policies


The significant accounting policies used in preparation of these interim financial statements are disclosed in the Company's Form 10-K and have not changed significantly since such filing.


Recently Issued Accounting Pronouncements


In June 2018, the FASB issued ASU 2018-07: Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This ASU expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees, and as a result, the accounting for share-based payments to non-employees will be substantially aligned. ASU 2018-07 is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year, early adoption is permitted but no earlier than an entity’s adoption date of Topic 606. The Company has not determined the impact of this standard and does not plan early adoption of this standard.


In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805) to clarify the definition of a business, which is fundamental in the determination of whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses combinations. The updated guidance requires that in order to be considered a business the integrated set of assets and activities acquired must include, at a minimum, an input and process that contribute to the ability to create output. If substantially all of the fair value of the assets acquired is concentrated in a single identifiable asset or group of similar assets, it is not considered a business, and therefore would not be considered a business combination. The update is effective for fiscal years beginning after December 15, 2018, and interim periods with fiscal years beginning after December 15, 2019, with early adoption permitted. The Company has not determined the impact of this standard and does not plan early adoption of this standard.




8



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


In August 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230)—Restricted Cash. ASU 2016-18 requires the statement of cash flows to be a reconciliation between beginning and ending cash balances inclusive of restricted cash balances. ASU 2016-18 is effective for fiscal years beginning after December 15, 2017 and is to be applied using a retrospective transition method to each period presented. The Company adopted this ASU for the year ending December 31, 2018. The adoption of this standard resulted in the removal of changes in Restricted Cash from the Consolidated Statements of Cash Flows of $1,122 and $98,879 for the six months ended June 30, 2018 and 2017, respectively and inclusion of these amounts as part of the starting and ending cash balances.


In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), requiring lessees to recognize for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and (2) a right-of-use (“ROU”) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The update is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2020. The Company currently anticipates that upon adoption of the new standard, ROU assets and lease liabilities will be recognized in amounts that will be immaterial to the consolidated balance sheets.


2. Acquisition of Pelican Therapeutics


On April 28, 2017, the Company consummated the acquisition of 80% of the outstanding equity of Pelican, a related party, and Pelican became a majority owned subsidiary of the Company. Operations of Pelican are included in the consolidated statements of operations and comprehensive loss from the acquisition date. Pelican is a biotechnology company focused on the development and commercialization of monoclonal antibody and fusion protein-based therapies that are designed to activate the immune system. In exchange for 80% of the outstanding capital stock of Pelican on a fully diluted basis, the Company paid to the Pelican Stockholders that executed the Stock Purchase Agreement (the “Participating Pelican Stockholders”) an aggregate of $0.5 million minus certain liabilities (the “Cash Consideration”), and issued to the Participating Pelican Stockholders 133,106 shares of the Company’s restricted common stock representing 4.99% of the outstanding shares of our common stock on the date of the initial execution of the Purchase Agreement (the “Stock Consideration”). During the six months ended June 30, 2018, the Cash Consideration of approximately $0.3 million was distributed to the Participating Pelican Stockholders and the remainder of approximately $0.2 million for certain Pelican liabilities not satisfied was recognized as other income in the Consolidated Statements of Operations and Comprehensive Loss.  


Under the agreement, the Company is also obligated to make future payments based on the achievement of certain clinical and commercialization milestones, as well as low single digit royalty payments and payments upon receipt of sublicensing income:


(1)

$2,000,000 upon Pelican’s dosing of the first patient in its first Phase 1 trial for an oncology indication;

(2)

$1,500,000 upon Pelican’s dosing of the first patient in its first Phase 2 trial for an oncology indication;

(3)

$3,000,000 upon successful outcome of the first Phase 2 trial for an oncology indication;

(4)

$6,000,000 upon Pelican’s dosing of the first patient in its first Phase 3 trial for an oncology indication;

(5)

$3,000,000 upon Pelican’s dosing of the first patient in its first Phase 3 trial for a non- oncology indication;

(6)

$7,500,000 upon successful outcome of the first Phase 3 trial for an oncology indication;

(7)

$3,000,000 upon successful outcome of the first Phase 3 trial for a non-oncology indication;

(8)

$7,500,000 upon acceptance of a Biologics License Application (BLA) submission for an oncology indication;

(9)

$3,000,000 upon acceptance of a BLA submission for a non-oncology indication;

(10)

$7,500,000 upon first product indication approval in the United States or Europe for an oncology indication;

(11)

$3,000,000 upon first product indication approval in the United States or Europe for a non-oncology indication.


The fair value of these future milestone payments is reflected in the contingent consideration account under long term liabilities on the balance sheet. The estimated fair value of the contingent consideration was determined using a probability-weighted income approach, at a discount of 6.49% based on the median yield of publicly traded non-investment grade debt of companies in the pharmaceutical industry. The Company performs an analysis on a quarterly basis and as of June 30, 2018, the Company determined the change in the estimated fair value of the contingent consideration was $539,980 for the quarter ended June 30, 2018.




9



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


The Company has recorded the assets purchased and liabilities assumed at their estimated fair value in accordance with FASB ASC Topic 805: Business Combinations. The purchase price exceeded the fair value of the net assets acquired resulting in goodwill of approximately $2.2 million. The identifiable indefinite-lived intangible asset consists of in-process R&D of approximately $5.9 million. The estimated fair value of the IPR&D was determined using a probability-weighted income approach, which discounts expected future cash flows to present value. The projected cash flows were based on certain key assumptions, including estimates of future revenue and expenses, taking into account the stage of development of the technology at the acquisition date and the time and resources needed to complete development. The Company utilized corporate bond yield data observed in the bond market to develop the discount rate utilized in the cash flows that have been probability adjusted to reflect the risks of product commercialization, which the Company believes are appropriate and representative of market participant assumptions. Operations of the acquired entity are included in the consolidated statements of operations from the acquisition date. 


The purchase price has been allocated to the assets and liabilities as follows: 


Aggregate consideration:

 

 

 

Cash consideration

 

$

500,000

 

Stock consideration

 

$

1,052,000

 

Contingent consideration

 

$

2,385,000

 

Total Consideration

 

$

3,937,000

 

 

 

 

 

 

 

 

 

 

 

Purchase price allocation:

 

 

 

 

Cash acquired

 

$

31,199

 

In-process R&D

 

$

5,866,000

 

Goodwill

 

$

2,189,338

 

Deferred tax liability

 

$

(2,111,760

)

Net liabilities assumed

 

$

(1,102,777

)

Fair value of non-controlling interest

 

$

(935,000

)

Total purchase price

 

$

3,937,000

 


Goodwill is calculated as the difference between the acquisition-date fair value of the consideration transferred and the fair values of the assets acquired and liabilities assumed. The goodwill resulting from this acquisition arises largely from synergies expected from combining the operations. The goodwill is not deductible for income tax purposes.


In-process R&D assets are treated as indefinite-lived until the completion or abandonment of the associated R&D program, at which time the appropriate useful lives will be determined.


The Company calculated the fair value of the non-controlling interest acquired in the acquisition as 20% of the equity interest of Pelican, adjusted for a minority interest discount.


In May 2016, Pelican was awarded a $15.2 million CPRIT Grant from CPRIT for development of Pelican’s lead product candidate, PTX-35. The CPRIT Grant is expected to allow Pelican to develop PTX-35 through a 70-patient Phase 1 clinical trial. The Phase 1 clinical trial will be designed to evaluate PTX-35 in combination with other immunotherapies. The CPRIT Grant is subject to customary CPRIT funding conditions including a matching funds requirement where Pelican will match $0.50 for every $1.00 from CPRIT. Consequently, Pelican is required to raise $7.6 million in matching funds over the three year project.


Pelican has contributed net revenue of $1.9 million and net loss of $1.2 million, respectively, which are included in the Company’s consolidated statement of operations and comprehensive loss for the six months ended June 30, 2018.




10



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


The following unaudited pro forma information presents the combined results of operations for the three and six months ended June 30, 2018 and 2017, as if the Company had completed the Pelican acquisition at the beginning of fiscal 2017. The pro forma financial information is provided for comparative purposes only and is not necessarily indicative of what actual results would have been had the acquisition occurred on the date indicated, nor does it give effect to synergies, cost savings, fair market value adjustments, immaterial amortization expense and other changes expected to result from the acquisition. Accordingly, the pro forma financial results do not purport to be indicative of consolidated results of operations as of the date hereof, for any period ended on the date hereof, or for any other future date or period.


 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2018

 

2017

 

 

2018

 

 

2017

 

Revenue

 

$

1,143,177

 

$

411,250

 

 

$

1,895,704

 

 

$

435,490

 

Net loss

 

 

(4,246,805

)

 

(3,310,791

)

 

 

(7,980,032

)

 

 

(6,940,735

)

Net loss: Non-controlling interest

 

 

(196,734

)

 

(90,508

)

 

 

(403,195

)

 

 

(219,142

)

Net loss attributable to Heat Biologics, Inc.

 

$

(4,050,071

)

$

(3,220,283

)

 

$

(7,576,837

)

 

$

(6,721,593

)

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

  

Net loss per share attributable to Heat Biologics, Inc.—basic and diluted

 

$

(0.27

)

$

(0.88

)

 

$

(0.77

)

 

$

(2.07

)


3. Fair Value of Financial Instruments


The carrying amount of certain of the Company’s financial instruments, including cash and cash equivalents, restricted cash, accounts payable and accrued expenses and other payables approximate fair value due to their short maturities.


As a basis for determining the fair value of certain of the Company’s financial instruments, the Company utilizes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:


Level I – Observable inputs such as quoted prices in active markets for identical assets or liabilities.


Level II – Observable inputs, other than Level I prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.


Level III – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.


This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the entire fair value measurement requires management to make judgments and consider factors specific to the asset or liability. The Company's cash equivalents are classified within Level I of the fair value hierarchy.


The following table provides a rollforward of the Company’s Level 3 fair value measurements:


 

 

Contingent Consideration

 

Balance at December 31, 2017

 

$

2,609,289

 

Change in fair value

 

 

551,098

 

Balance at June 30, 2018

 

$

3,160,387

 


The change in the fair value of the contingent consideration of $551,098 for the six months ended June 30, 2018 reflects an increase in the probability of reaching Pelican’s dosing of the first patient in its first Phase 1 trial for an oncology indication based on the passage of time and impact of progress in antibody manufacturing. Adjustments associated with the change in fair value of contingent consideration are included in the Company’s consolidated statement of operations and comprehensive loss.




11



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


The following table presents quantitative information about the inputs and valuation methodologies used for the Company’s fair value measurements of contingent consideration classified as Level 3 as of June 30, 2018:


 

 

Valuation
Methodology

 

 

Significant
Unobservable Input

 

Weighted Average
(range, if applicable)

 

 

 

 

 

 

 

 

Contingent Consideration

 

Probability weighted
income approach

 

 

Milestone dates

 

2019-2026

 

 

 

 

 

Discount rate

 

11.68% to 4.50%

 

 

 

 

 

Probability of occurrence

 

23% - 86%


4. Prepaid Expenses and Other Current Assets


Prepaid expenses and other current assets consist of the following at:


 

 

June 30,

2018

 

December 31,
2017

 

 

 

 

 

 

  

Prepaid manufacturing expense

 

$

3,810,178

 

$

1,551,597

 

Prepaid insurance

 

 

31,250

 

 

218,750

 

Other prepaid expenses

 

 

146,387

 

 

87,937

 

Other current assets

 

 

20,000

 

 

108,973

 

 

 

$

4,007,815

 

$

1,967,257

 


5. Property and Equipment


Property and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives, ranging generally from five to seven years. Expenditures for maintenance and repairs are charged to expense as incurred.


Property and equipment consisted of the following:


 

 

June 30,

2018

 

December 31,
2017

 

 

 

 

 

 

  

Furniture and fixtures

 

$

55,883

 

$

55,883

 

Computers

 

 

26,383

 

 

41,333

 

Lab equipment

 

 

1,116,307

 

 

645,433

 

 

 

 

 

 

 

 

 

Total

 

 

1,198,573

 

 

742,649

 

Accumulated depreciation

 

 

(552,839

)

 

(455,758

)

 

 

 

 

 

 

 

 

Property and equipment, net

 

$

645,734

 

$

286,891

 


Depreciation expense was $108,408 and $66,671 for the six months ended June 30, 2018 and 2017, respectively.


6. Goodwill and In-Process R&D


Goodwill of $2.2 million and in-process R&D of $5.9 million were recorded in connection with the acquisition of Pelican, as described in Note 2. The carrying value of goodwill and in-process R&D has remained unchanged and no impairment was recognized as of June 30, 2018 and December 31, 2017.




12



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


7. Accrued Expenses and other payables


Accrued expenses and other payables consist of the following:


 

 

June 30,
2018

 

December 31,
2017

 

 

 

 

 

 

 

 

 

Accrued clinical trial and other expenses

 

$

1,226,998

 

$

1,504,240

 

Compensation and related benefits

 

 

88,518

 

 

542,434

 

Deferred rent

 

 

18,051

 

 

27,457

 

Patent fees

 

 

30,000

 

 

40,000

 

Other expenses

 

 

82,300

 

 

162,300

 

 

 

$

1,445,867

 

$

2,276,431

 


8. Stock-Based Compensation


Stock Options


The following is a summary of the stock option activity for the six months ended June 30, 2018:


 

 

Shares

 

 

Weighted

Average

Exercise

Price

 

Outstanding, December 31, 2017

 

 

266,884

 

 

$

19.57

 

Granted

 

 

173,336

 

 

 

3.97

 

Forfeited

 

 

(15,628

)

 

 

32.80

 

Outstanding, June 30, 2018

 

 

424,592

 

 

$

12.72

 


The weighted average grant-date fair value of stock options granted during the six months ended June 30, 2018 was $2.84. The fair value of each stock option was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions for stock options granted during the six months ended June 30, 2018:


Dividend yield

 

 

0.0

%

Expected volatility

 

 

83.96

%

Risk-free interest rate

 

 

2.34

%

Expected lives (years)

 

 

6.3

 


The risk-free interest rate is based on U.S. Treasury interest rates at the time of the grant whose term is consistent with the expected life of the stock options. The Company used an average historical stock price volatility based on an analysis of reported data for a peer group of comparable companies that have issued stock options with substantially similar terms, as the Company did not have sufficient trading history for its common stock. Expected term represents the period that the Company’s stock option grants are expected to be outstanding. The Company elected to utilize the “simplified” method to estimate the expected term. Under this approach, the weighted-average expected life is presumed to be the average of the vesting term and the contractual term of the option.


Expected dividend yield was considered to be 0% in the option pricing formula since the Company had not paid any dividends and had no plans to do so in the future. The forfeiture rate was considered to be none as the options vest on a monthly basis.




13



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


The Company recognized $108,340 and $123,418 in stock-based option compensation expense for the three months ended June 30, 2018 and 2017, respectively and $242,147 and $245,142 in stock-based option compensation expense for the six months ended June 30, 2018 and 2017, respectively. The following table summarizes information about stock options outstanding at June 30, 2018:


Options Outstanding

 

 

Options Vested and Exercisable

 

6/30/2018

 

 

Weighted

Average

Remaining

Contractual

Life

(Years)

 

 

Weighted

Average

Exercise

Price

 

 

Balance

as of

6/30/2018

 

 

Weighted

Average

Remaining

Contractual

Life

(Years)

 

 

Weighted

Average

Exercise

Price

 

424,592

 

 

8.5

 

 

$12.72

 

 

161,461

 

 

7.4

 

 

$24.06

 


As of June 30, 2018, the unrecognized stock-based compensation expense related to unvested stock options was $1,522,789, which is expected to be recognized over a weighted average period of approximately 17.31 months.


Restricted Stock


The Company recognized $31,097 and $19,686 in stock-based compensation expense for employees related to restricted stock awards during the three months ended June 30, 2018 and 2017, respectively, and $265,228 and $136,207 in stock-based compensation expense for employees related to restricted stock awards during the six months ended June 30, 2018 and 2017, respectively. The Company recognized $802 and $10,500 in share-based compensation expense related to issuance of shares of restricted stock to non-employees (i.e., consultants) in exchange for services during the three months ended June 30, 2018 and 2017, respectively and $4,757 and $21,000 in share-based compensation expense related to issuance of shares of restricted stock to non-employees (i.e., consultants) in exchange for services during the six months ended June 30, 2018 and 2017, respectively. As of June 30, 2018, there were 62,207 restricted stock awards granted to employees and non-employees, all of which were unvested.


Total stock-based compensation expense, including restricted stock and stock options was $512,120 and $402,349 for the six months ended June 30, 2018 and 2017, respectively.


9. Financing


Public Offering


On May 7, 2018, the Company closed an underwritten public offering (the “Offering”) in which it issued and sold (i) 4,875,000 shares of common stock together with a number of common warrants to purchase 2,437,500 shares of its common stock, and (ii) 9,500,000 pre-funded warrants, with each pre-funded warrant exercisable for one share of common stock, together with a number of common warrants to purchase 4,750,000 shares of its common stock. The public offering price was $1.44 per share of common stock, $1.43 per pre-funded warrant and $0.01 per common warrant. The net proceeds to the Company were approximately $18.8 million, net of underwriting discounts and commissions and other estimated offering expenses. The common stock warrants expire five years after date of issuance and have an exercise price of $1.584 per share. As of June 30, 2018, 3,054,667 common stock warrants have been exercised for an additional $4.8 million of proceeds to the Company and all pre-funded warrants have been exercised. In connection with the offering the Company entered into an underwriting agreement (the “Underwriting Agreement”), dated May 2, 2018 with A.G.P./Alliance Global Partners (A.G.P.), as representative of the underwriters. The Underwriting Agreement contains customary representations, warranties, and agreements by the Company, customary conditions to closing, indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act of 1933, as amended (the “Securities Act”), other obligations of the parties and termination provisions.




14



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


At the Market Offering


On January 18, 2018, the Company entered into a Common Stock Sales Agreement with H.C. Wainwright & Co., LLC, (“HCW”) as sales agent, pursuant to which the Company may sell from time to time, at its option, shares of its common stock, par value $0.0002 per share for the sale of up to $3,658,000 of shares of the Company’s common stock and on March 15, 2018 issued a prospectus supplement for an additional aggregate offering price of up to $1,300,000. Sales of shares of common stock have been made pursuant to the Company’s shelf registration statement on Form S-3 (File No. 333-221201) filed with the U.S. Securities and Exchange Commission (“SEC”), dated November 13, 2017. As of June 30, 2018 the Company sold an aggregate of 1,403,367 shares of common stock under the HCW Sales Agreement resulting in net proceeds of approximately $3.4 million.


Common Stock Warrants


In connection with the May 7, 2018 public offering, the Company issued 9,500,000 pre-funded warrants and 7,187,500 common stock warrants each of which are exercisable for one share of common stock. The pre-funded warrants had an exercise price of $0.01 per share and as of June 30, 2018 all pre-funded warrants have been exercised. The common stock warrants have an exercise price of $1.584 per share and expire five years from the issuance date. As of June 30, 2018, 3,054,667 common stock warrants have been exercised. The warrants have been accounted for as equity instruments. The fair value of the common stock warrants of approximately $7.8 million at the date of issuance was estimated using the Black-Scholes Merton model which used the following inputs: term of 5 years, risk free rate of 2.78%, 0% dividend yield, volatility of 124.14%, and share price of $1.30 per share based on the trading price of the Company’s common stock.


In connection with the March 23, 2017 public offering the Company issued warrants to purchase 682,500 shares of common stock with an exercise price of $10.00 per share that expire five years from the issuance date. In connection with the Company’s July 23, 2013 initial public offering, the Company issued warrants to the underwriters for 12,500 shares of common stock issuable at $125.00 per share upon exercise that expire five years from the issuance date. On March 10, 2011, the Company issued warrants to purchase shares of common stock to third parties in consideration for a private equity placement transaction of which 1,738 warrants remain outstanding. The warrants have an exercise price of $4.80 per share and expire ten years from the issuance date.


During the six months ended June 30, 2018, 3,054,667 common stock warrants have been exercised and no warrants were exercised during the same period in 2017. The Company has outstanding warrants to purchase 4,132,833 shares of common stock issuable at $1.584 per share, 296,159 shares of common stock issuable at $10.00 per share; warrants to purchase 12,500 shares of common stock issuable at $125.00 per share; and warrants to purchase 1,738 shares of common stock issuable at $4.80 per share. These warrants do not meet the criteria required to be classified as liability awards and therefore are treated as equity awards.


10. Grant and Licensing Revenues


In June 2016, Pelican entered into a Cancer Research Grant Contract (“Grant Contract”) with CPRIT, under which CPRIT awarded a grant not to exceed $15.2 million for use in developing cancer treatments by targeting a novel T-cell costimulatory receptor (namely, TNFRSF25). The Grant Contract covers a three-year period from June 1, 2016 through May 31, 2019.


Upon commercialization of the product, the terms of the Grant Contract require Pelican to pay tiered royalties in the low to mid-single digit percentages. Such royalties reduce to less than one percent after a mid-single-digit multiple of the grant funds have been paid to CPRIT in royalties.


The Company recognized grant revenue of approximately $1.1 million and $1.9 million during the three and six months ended June 30, 2018 for qualified expenditures under the grant. The Company recognized grant revenue during the three months ended June 30, 2017 of approximately $0.4 million and for the six months ended June 30, 2017 revenue included an additional $0.02 million of research funding revenue for research and development services, provided to Shattuck Labs, Inc. which research funding agreement terminated January 31, 2017.


As of June 30, 2018, the Company had deferred revenue of $5.1 million for proceeds received from the CPRIT grant, but for which the costs had not been incurred or the conditions of the award had not been met.



15



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


11. Net Loss Per Share


Basic and diluted net loss per common share is calculated by dividing net loss applicable to Heat Biologics, Inc. by the weighted-average number of common shares outstanding during the period, without consideration for common stock equivalents. The Company’s potentially dilutive shares, which include outstanding stock options and warrants, are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. The following table reconciles net loss to net loss attributable to Heat Biologics, Inc.:


 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2018

 

2017

 

 

2018

 

 

2017

 

Net loss

 

$

(4,246,805

)

$

(3,309,081

)

 

$

(7,980,032

)

 

$

(6,549,809

)

Net loss: Non-controlling interest

 

 

(196,734

)

 

(90,166

)

 

 

(403,195

)

 

 

(140,956

)

Net loss attributable to Heat Biologics, Inc.

 

$

(4,050,071

)

$

(3,218,915

)

 

$

(7,576,837

)

 

$

(6,408,853

)

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

  

Weighted-average number of common shares used in net loss per share attributable to Heat Biologics, Inc.—basic and diluted

 

 

14,727,682

 

 

3,524,483

 

 

 

9,894,367

 

 

 

3,112,412

 

Net loss per share attributable to Heat Biologics, Inc.—basic and diluted

 

$

(0.27

)

$

(0.91

)

 

$

(0.77

)

 

$

(2.06

)


The following potentially dilutive securities were excluded from the calculation of diluted net loss per share due to their anti-dilutive effect:


 

 

For the Six months Ended

June 30,

 

 

 

2018

 

2017

 

Outstanding stock options

 

 

424,592

 

 

252,000

 

Outstanding restricted stock units

 

 

62,207

 

 

30,623

 

Outstanding common stock warrants

 

 

4,443,230

 

 

310,397

 


12. Income Tax

 

Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases, operating loss carryforwards, and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. As of June 30, 2018, a full valuation allowance has been provided against certain deferred tax assets as it is currently deemed more likely than not that the benefit of such net tax assets will not be utilized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.


In accordance with FASB ASC 740, Accounting for Income Taxes, the Company reflects in the accompanying unaudited condensed consolidated financial statements the benefit of positions taken in a previously filed tax return or expected to be taken in a future tax return only when it is considered ‘more-likely-than-not’ that the position taken will be sustained by a taxing authority. As of June 30, 2018, and December 31, 2017, the Company had no unrecognized income tax benefits and correspondingly there is no impact on the Company’s effective income tax rate associated with these items. The Company’s policy for recording interest and penalties relating to uncertain income tax positions is to record them as a component of income tax expense in the accompanying statements of operations and comprehensive loss. As of June 30, 2018, and December 31, 2017, the Company had no such accruals.




16



HEAT BIOLOGICS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 


On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was enacted into law. The Tax Act lowered the Federal corporate tax rate from 34% to 21% for periods beginning on or after January 1, 2018 and made numerous other tax law changes. The Company has measured deferred tax assets at the enacted tax rate expected to apply when these temporary differences are expected to be realized or settled. The Company is required to recognize the effect of tax law changes in the period of enactment. Additional federal and state interpretive guidance is still forthcoming that could potentially affect the measurement of these balances or give rise to new deferred tax amounts. As such, the remeasurement of our deferred tax balance is provisional pending future guidance. The Company reasonably anticipates that any such guidance will be available prior to December 31, 2018.


13. Subsequent Events


On July 20, 2018, the Company’s Board of Directors, approved an amendment (the “Amendment”) to the Amended and Restated Bylaws of the Company. The Amendment, which was adopted effective as of July 20, 2018, provides that at each meeting of stockholders the presence in person or by proxy of the holders of shares of stock having one-third (1/3) of the shares of stock entitled to vote at the meeting is necessary to constitute a quorum.

 

On July 20, 2018, the previously scheduled 2018 Annual Meeting of Stockholders of the Company was adjourned due to the absence of a quorum due, in part, to lack of votes by shares held in certain European brokerage accounts. On August 13, 2018, the Board of Directors of the Company approved October 2, 2018  as the new date of the 2018 Annual Meeting of Stockholders.





17



 


ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.


You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes included in this Quarterly Report on Form 10-Q. The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results and the timing of certain events could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those discussed below and elsewhere in this Quarterly Report. This discussion should be read in conjunction with the accompanying unaudited consolidated financial statements and the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017 filed with the Securities and Exchange Commission on March 2, 2018 (the “2017 Annual Report”). This discussion may contain forward-looking statements that involve risks and uncertainties. See “Forward-Looking Statements.”


OVERVIEW


We are a biopharmaceutical company developing approaches to activate and co-stimulate a patient’s immune system against cancer. Our co-stimulatory antibody is designed to harness the body's natural antigen specific immune activation and tolerance mechanisms to reprogram immunity and provide a long-term, durable clinical effect. Our T-cell activating platform (TCAP) produces therapies designed to turn immunologically “cold” tumors “hot,” and can be administered in combination with checkpoint inhibitors and other immuno-modulators to increase clinical efficacy.  Unlike many other “patient specific” immunotherapy approaches, our drugs are “off-the-shelf,” which means that we can administer drug immediately without extracting patient material at a substantially lower cost of goods sold. Our TCAP product candidates from our ImPACT® and ComPACT platforms are produced from allogeneic cell lines expressing tumor-specific proteins common among cancers. We are currently enrolling patients in our Phase 2 clinical trial for advanced NSCLC, in combination with Bristol-Myers Squibb’s nivolumab (Opdivo®). We also have numerous pre-clinical programs at various stages of development.


Heat’s pipeline includes two TCAPs, ImPACT® and ComPACT. The ImPACT® platform is based on product candidates that consist of live, allogeneic “off-the-shelf” genetically-modified, irradiated human cancer cells. These cells secrete a broad spectrum of Cancer Testis Antigens (“CTAs”), classified functionally as tumor specific neoantigens, chaperoned by the gp96 protein. Our ImPACT® technology achieves this by reprogramming live tumor cells to secrete gp96, to serve as a chaperone for tumor antigens to activate and expand T-cell immunity; thereby, transforming the allogeneic cells into machines that activate a robust “killer” CD8+ T cell immune attack against a patient’s cancer. Unlike autologous or “personalized” monotherapy approaches that either require the extraction of blood or tumor tissue from each patient or the creation of an individualized treatment, our product candidates are fully allogeneic, and do not require extraction of individual patient’s material or custom manufacturing. Because each patient receives the same treatment, we believe that our immunotherapy approach offers logistical, manufacturing and other cost benefits, compared to patient-specific or precision medicine approaches.


ComPACT our second TCAP, is a dual-acting immunotherapy designed to deliver T-cell activation and enhanced, T-cell specific co-stimulation in a single treatment. ComPACT helps unlock the body’s natural defenses and builds upon ImPACT® by also providing alternative co-stimulation targeting enhanced T-cell activation and expansion. It has the potential to simplify combination immunotherapy development with enhanced safety for oncology patients, as it is designed to deliver the gp96 heat shock protein with each selected tumor cell line’s neoantigens (CTAs) and a T-cell co-stimulatory fusion protein (e.g. OX40L) into a single intradermal treatment. ComPACT serves as a booster to expand the number of antigen-specific T-cells compared to co-stimulator alone, while also enhancing the activation of cancer antigen-specific CD8+ memory T-cells for an extended time after treatment. ComPACT has the potential to be a cost-effective approach compared to conventional immunotherapies.


Pelican, our subsidiary, is a biotechnology company focused on the development of monoclonal antibody and fusion protein-based therapies designed to activate the immune system. PTX-35, which is currently in preclinical IND enabling activities, is Pelican’s lead product candidate targeting the T-cell co-stimulator, TNFRSF25. It is designed to harness the body's natural antigen specific immune activation and tolerance mechanisms to reprogram the immunity and provide a long-term, durable clinical effect. When combined with immunotherapies, including the ImPACT® and ComPACT platform technologies, PTX-35 has been shown to enhance antigen specific T-cell activation to eliminate tumor cells. PTX-15, Pelican’s second product candidate, is a human TL1A-lg fusion protein designed as a shorter half-life agonist of TNFRSF25.


Our wholly-owned subsidiary, Zolovax, is in preclinical studies to develop therapeutic and preventative vaccines to treat infectious diseases based on our gp96 vaccine technology, with a current focus on the development of a Zika vaccine in collaboration with the University of Miami. Other infectious diseases of interest include HIV, West Nile virus, and dengue and yellow fever.



18



 


Currently we are enrolling patients in our HS-110 combination immunotherapy trial, preparing for IND submission of HS-130, and advancing pre-clinical development of Pelican assets, providing general and administrative support for these operations and protecting our intellectual property. We currently do not have any products approved for sale and we have not generated any significant revenue since our inception and no revenue from product sales. We expect to continue to incur significant expenses and to incur increasing operating losses for at least the next several years. We anticipate that our expenses will increase substantially as we:


·

complete the ongoing clinical trials of our product candidates;

·

maintain, expand and protect our intellectual property portfolio;

·

seek to obtain regulatory approvals for our product candidates;

·

continue our research and development efforts;

·

add operational, financial and management information systems and personnel, including personnel to support our product development and commercialization efforts; and

·

operate as a public company.


Recent Developments


On February 27, 2018, at the 2018 Keystone Symposia Conference, Immunological Memory: Innate, Adaptive and Beyond (XI1), we presented interim results from our Phase 2 study investigating HS-110 in combination with Bristol-Myers Squibb’s anti-PD-1 checkpoint inhibitor, nivolumab (Opdivo®), in patients with advanced NSCLC whose cancers have progressed after treatment with one or more lines of therapy.


Among the 35 patients in the Intent-to-Treat (“ITT”) population, 6 patients (17%) achieved a partial response and 14 patients (40%) achieved disease control.  Evaluable ITT patients (those who underwent at least one follow-up scan regardless of treatment duration) demonstrated overall response and disease control rates of 26% and 67%, respectively.  Overall responses appeared durable and long lasting. The survival data are still maturing, and median overall survival has not yet been reached. The combination of HS-110 and nivolumab was well tolerated, with no additional toxicities compared to what has been observed with single agent checkpoint inhibitors.


As predefined in the clinical protocol, patient subgroups were evaluated for levels of tumor infiltrating lymphocytes (“TIL”) and for PD-L1 checkpoint protein expression on tumor cells. 4 of 9 “cold tumor” patients with low TIL levels (<10%) at baseline had partial responses. HS-110 also showed a durable effect in patients with low levels of PD-L1, with 3 of 9 patients responding. Both of these patient populations respond poorly to checkpoint inhibitors.


Pursuant to the authority granted to our board of directors by our stockholders at the 2017 Annual Meeting of Stockholders, our board of directors authorized a one-for-ten reverse stock split, which was effected on January 19, 2018. As a result of the stock split, the total number of shares of common stock was reduced to approximately 4.2 million shares for all stockholders of record and the conversion ratio for all instruments convertible into or exercisable for shares of common stock, including stock options and warrants, was proportionately adjusted. The reverse stock split was implemented in order to remain compliant with the NASDAQ Capital Market minimum stock price continued listing requirements.  On February 5, 2018, we were notified by the NASDAQ Capital Market that we had regained compliance with the minimum stock price continued listing requirement.


On March 11, 2018, our board of directors declared a dividend of one common share purchase right (a “Right”) for each outstanding share of our common stock. Each Right initially entitles the registered holder to purchase from us one share of common stock at a price of $14.00 per share of our common stock, subject to adjustment. The description and terms of the Rights are set forth in a Rights Agreement, dated as of March 11, 2018, as the same may be amended from time to time (the “Rights Agreement”), between the Company and Continental Stock Transfer & Trust Company, as Rights Agent. Expiration date of the Rights Agreement is the earlier of March 11, 2019 or contingent on various other factors per the Rights Agreement. The Rights are designed to assure that all of our stockholders receive fair and equal treatment in the event of a hostile takeover of the Company, to guard against two-tier or partial tender offers, open market accumulations and other tactics designed to gain control of the Company without paying all stockholders a fair price, and to enhance the board of directors’ ability to negotiate with any prospective acquirer.




19



 


On March 26, 2018, we reported 2-year recurrence rate data from the Phase 2 trial evaluating HS-410 (vesigenurtacel-L) in combination with standard of care, Bacillus Calmette-Guérin (BCG), for the treatment of non-muscle invasive bladder cancer (NMIBC). We had previously discontinued our HS-410 program in order to focus our resources on current and future checkpoint combination trials, including our HS-110 Phase 2 lung cancer program in combination with Bristol-Myers Squibb’s checkpoint inhibitor nivolumab. However, in keeping with clinical trial guidance, we continued to monitor all patients enrolled in the study for a 2-year duration. Within the subgroup of patients who received the low dose of our ImPACT® HS-410 with standard of care BCG and who demonstrated a positive immune response, 10 out of 10 (100%) remained disease free after a 2-year period. A positive immune response was defined as 2-fold or greater increase from baseline of CD8+ T cells in peripheral blood as measured by ELISPOT analysis.


On April 18, 2018, we provided guidance on upcoming clinical milestones for HS-110 in NSCLC, our ComPACT™ platform, as well as our Pelican subsidiary's co-stimulator antibody, PTX-35, for the next four quarters. Anticipated clinical milestones for HS-110 include an interim data readout in Q4 2018 and completion of  Phase 2 patient enrollment with data readout in Q2 2019. Expected PTX-35 milestones include receipt of $6.9 million in CPRIT grant funds to support the enrollment of the first patient in a Phase 1 clinical trial in Q1 2019 and an interim data readout in Q3 2019. Additionally, we plan on enrolling our first patient in our ComPACT trial in Q4 2018 and anticipate an interim data readout in Q2 2019.


On May 7, 2018, we closed an underwritten public offering in which we issued and sold (i) 4,875,000 shares of common stock together with a number of common warrants to purchase 2,437,500 shares of our common stock, and (ii) 9,500,000 pre-funded warrants, with each pre-funded warrant exercisable for one share of common stock, together with a number of common warrants to purchase 4,750,000 shares of our common stock. The public offering price was $1.44 per share of common stock, $1.43 per pre-funded warrant and $0.01 per common warrant. The net proceeds to us were approximately $18.8 million, net of underwriting discounts and commissions and other estimated offering expenses. The common stock warrants expire five years after date of issuance and have an exercise price of $1.584 per share. As of June 30, 2018, 3,054,667 common stock warrants have been exercised for an additional $4.8 million in proceeds and all pre-funded warrants have been exercised. In connection with the offering we entered into an underwriting agreement, dated May 2, 2018 with A.G.P./Alliance Global Partners (A.G.P.), as representative of the underwriters.


CRITICAL ACCOUNTING POLICIES AND SIGNIFICANT JUDGMENTS AND ESTIMATES


We believe that several accounting policies are important to understanding our historical and future performance. We refer to these policies as “critical” because these specific areas generally require us to make judgments and estimates about matters that are uncertain at the time we make the estimate, and different estimates—which also would have been reasonable—could have been used, which would have resulted in different financial results.


Our management’s discussion and analysis of financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of our consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates based on historical experience and make various assumptions, which management believes to be reasonable under the circumstances, which form the basis for judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.


The notes to our audited consolidated financial statements contain a summary of our significant accounting policies. We consider the following accounting policies critical to the understanding of the results of our operations:


·

Revenue;

·

Deferred revenue;

·

In-process R&D;

·

Contingent consideration;

·

Stock-based compensation; and

·

Research and development costs, including clinical and regulatory cost.




20



 


RESULTS OF OPERATIONS


Comparison of the Three months ended June 30, 2018 and 2017


Revenues


For the three months ended June 30, 2018 and 2017, we recognized $1.1 million and $0.4 million of grant revenue for qualified expenditures under the CPRIT grant. As of June 30, 2018, we had deferred revenue of $5.1 million for proceeds received but for which the costs had not been incurred or the conditions of the award had not been met. We continue our efforts to secure future non-dilutive grant funding to subsidize ongoing research and development costs.


Research and development expense.


Research and development expenses increased approximately 59.1% to $3.5 million for the three months ended June 30, 2018 compared to $2.2 million for the three months ended June 30, 2017. The components of R&D expense are as follows, in millions:


 

 

Three months Ended,

 

 

 

June 30,

 

 

 

2018

 

 

2017

 

Programs

 

 

 

 

 

 

HS-110

 

$

0.8

 

 

$

1.0

 

HS-410

 

 

0.0

 

 

 

0.2

 

HS-130

 

 

0.4

 

 

 

0.0

 

PTX 35/15

 

 

1.4

 

 

 

0.0

 

Other programs

 

 

0.1

 

 

 

0.2

 

Unallocated research and development expenses

 

 

0.8

 

 

 

0.8

 

 

 

$

3.5

 

 

$

2.2

 


·

HS-110 expense decreased $0.2 million, primarily related to one time CMC expenses during the three months ended June 30, 2017 that did not reoccur during the three months ended June 30, 2018.

·

HS-410 expense decreased $0.2 million due to the current phase of the trial where in patients are in long-term follow-up for recurrence-free survival.

·

HS-130 expense increased by $0.4 million as we continue our development of clinical trial material for this program.

·

PTX expense for the three months ended June 30, 2018 was $1.4 million as we began pre-clinical development of PTX-35 and PTX-15 against TNFRSF25 for testing in patients.

·

Other programs include preclinical costs associated with our Zika program, T-cell costimulatory programs, and laboratory supplies.

 

General and administrative expense. General and administrative expense decreased approximately 12.5% to $1.4 million for the three months ended June 30, 2018 compared to $1.6 million for the three months ended June 30, 2017. The $0.2 million decrease is primarily attributable to the acquisition costs of our Pelican subsidiary during the three months ended June 30, 2017.


Change in fair value of contingent consideration.  We reassess the actual consideration earned and the probability-weighted future earn-out payments at each balance sheet date. The change in the fair value of contingent consideration was $539,980 for the three months ended June 30, 2018.  There was no change in the fair value for the three months ended June 30, 2017 as the acquisition of Pelican was completed during this quarter.


Interest income.  Interest income was $44,164 for the three months ended June 30, 2018 compared to $6,466 for the three months ended June 30, 2017. The increase of $37,698 is due to the investment of our cash in various short-term financial instruments that generated interest income during the quarter.


Other income (expense). Other expense was $53,224 for the quarter ended June 30, 2018 compared to other income of $7,716 for the quarter ended June 30, 2017. In 2018, other expense was primarily due to unrealized loss related to foreign currency transactions as well as the write-off during the quarter of disposed assets.  In 2017, other income was primarily related to foreign currency gains on several transactions in Australia.




21



 


Net loss attributable to Heat Biologics, Inc. We had a net loss attributable to Heat Biologics, Inc. of $4.1 million, or ($0.27) per basic and diluted share for the three months ended June 30, 2018 compared to a net loss of $3.2 million, or ($0.91) per basic and diluted share for the three months ended June 30, 2017.


Comparison of the Six months ended June 30, 2018 and 2017


Revenues


For the six months ended June 30, 2018, we recognized $1.9 million of grant revenue for qualified expenditures under the CPRIT grant. For the six months ended June 30, 2017, we recognized $0.4 million of grant and licensing revenue, primarily consisting of grant revenue for qualified expenditures under the CPRIT grant.  Included in 2017 revenue, is $0.02 million of research funding revenue for research and development services, provided to Shattuck Labs, Inc. which research funding agreement terminated January 31, 2017.  As of June 30, 2018, we had deferred revenue of $5.1 million for proceeds received but for which the costs had not been incurred or the conditions of the award had not been met. We continue our efforts to secure future non-dilutive grant funding to subsidize ongoing research and development costs.


Research and development expense.


Research and development expenses increased approximately 60% to $6.4 million for the six months ended June 30, 2018 compared to $4.0 million for the six months ended June 30, 2017. The components of R&D expense are as follows, in millions:


 

 

Six months Ended,

 

 

 

June 30,

 

 

 

2018

 

 

2017

 

Programs

 

 

 

 

 

 

HS-110

 

$

1.8

 

 

$

1.4

 

HS-410

 

 

0.1

 

 

 

0.5

 

HS-130

 

 

0.5

 

 

 

0.0

 

PTX 35/15

 

 

2.2

 

 

 

0.0

 

Other programs

 

 

0.2

 

 

 

0.3

 

Unallocated research and development expenses

 

 

1.6

 

 

 

1.8

 

 

 

$

6.4

 

 

$

4.0

 


·

HS-110 expense increased $0.4 million, as we increase patient enrollment in the phase 2 portion of the clinical trial.

·

HS-410 expense decreased $0.4 million due to the current phase of the trial where in patients are in long-term follow-up for recurrence-free survival.

·

HS -130 expense increased by $0.5 million as we began developing clinical trial material for this program.

·

PTX expense for the six months ended June 30, 2018 was $2.2 million as we began pre-clinical development of PTX-35 and PTX-15 against TNFRSF25 for testing in patients.

·

Other programs include preclinical costs associated with our Zika program, T-cell costimulatory programs, and laboratory supplies.

 

General and administrative expense. General and administrative expense was $3.1 million for both of the six months ended June 30, 2018 and 2017. During the six months ended June 30, 2018 general and administrative expense consists of increased personnel costs as we establish our Texas operations associated with our Pelican subsidiary. During the six months ended June 30, 2017, general and administrative expense included costs associated with the acquisition of our Pelican subsidiary.


Change in fair value of contingent consideration.  We reassess the actual consideration earned and the probability-weighted future earn-out payments at each balance sheet date. The change in the fair value of contingent consideration was $551,098 for the six months ended June 30, 2018.  There was no change in the fair value for the six months ended June 30, 2017 as the acquisition of Pelican was completed during this quarter.


Interest income.  Interest income was $47,797 for the six months ended June 30, 2018 compared to $11,687 for the six months ended June 30, 2017. The increase of $36,110 is due to the investment in various short-term financial instruments that generated interest income during the six months.




22



 


Other income (expense). Other income increased slightly to $121,796 for the six months ended June 30, 2018 compared to $77,443 for the six months ended June 30, 2017. In 2018, other income is primarily related to the release of escrow funds to us for payment of liabilities related to the Pelican acquisition. In 2017, other income was primarily related to foreign currency gains on several transactions in Australia.


Net loss attributable to Heat Biologics, Inc. We had a net loss attributable to Heat Biologics, Inc. of $7.6 million, or ($0.77) per basic and diluted share the six months ended June 30, 2018 compared to a net loss of $6.4 million, or ($2.06) per basic and diluted share for the six months ended June 30, 2017.


Balance Sheet at June 30, 2018 and December 31, 2017


Prepaid Expenses and Other Current Assets. Prepaid expenses and other current assets was approximately $4.0 million as of June 30, 2018 and $2.0 million as of December 31, 2017. The $2.0 million increase was primarily attributable to the amount paid in advance for cGMP production for PTX-35 antibody and PTX-15 fusion protein.


In-Process R&D and Goodwill. As of June 30, 2018 and December 31, 2017, we had in-process R&D of $5.9 million and goodwill of $2.2 million from our acquisition of Pelican. The fair value of these assets did not change during the six months ended June 30, 2018.


Accounts Payable. Accounts payable was approximately $0.8 million as of June 30, 2018 compared to approximately $1.0 million as of December 31, 2017. The decrease of approximately $0.2 million is related to payables for CMC as well as investigator site payments for our clinical trials.


Deferred Revenue. We had deferred revenue of $5.1 million and $7.0 million as of June 30, 2018 and December 31, 2017, respectively. This deferred revenue primarily represents proceeds received for the CPRIT grant but for which the costs had not been incurred or the conditions of the award had not been met and $0.2 million related to an economic development grant received from San Antonio for the purchase of lab equipment.


Accrued Expenses and Other Liabilities. Accrued expenses and other liabilities were approximately $1.4 million as of June 30, 2018 compared to approximately $2.3 million as of December 31, 2017. The decrease of approximately $0.9 million was related to 2017 employee bonuses which were accrued at December 31, 2017 but subsequently paid in January 2018.


Contingent Consideration. As of June 30, 2018, we had contingent consideration of $3.2 million related to our acquisition of Pelican. This amount represents the fair value of future milestone payments to Pelican shareholders which were discounted in accordance with ASC 805. We perform an analysis on a quarterly basis and as of June 30, 2018, we determined the change in the estimated fair value of the contingent consideration during the quarter was $539,980.


LIQUIDITY AND CAPITAL RESOURCES


Sources of Liquidity


We commenced active operations in June 2008. Initially, we financed our operations from the private placement of our preferred stock, common stock and debt. More recently, we have primarily financed our operations with net proceeds from the public offering of our common stock and to a lesser extent, the proceeds from the exercise of warrants. During May 2018, we closed a public offering of shares of our common stock and warrants to purchase shares of our common stock in which we received net proceeds of approximately $18.7 million and after the closing of the offering, an additional $4.8 million from the exercise of 3,054,667 warrants issued in this offering. In addition, we received an aggregate of $9.3 million of net proceeds through our At Market Issuance Sales Agreement (the “FBR Sales Agreement”) with B. Riley FBR, Inc. formerly known as FBR Capital Markets & Co. On January 18, 2018, we entered into the H.C. Wainwright Sales Agreement that replaced the FBR Sales Agreement. To date, we received net proceeds of approximately $3.4 million from the sale of shares of our common stock through the H.C. Wainwright Sales Agreement. As of June 30, 2018, we have received $8.3 million in grant funding from the CPRIT Grant through Pelican. As of June 30, 2018, we had an accumulated deficit of $76.4 million. We had net losses of $7.6 million and $6.4 million for the six months ended June 30, 2018 and 2017, respectively.




23



 


We expect to incur significant expenses and continued losses from operations for the foreseeable future. We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the research and development and advance our clinical trials of, and seek marketing approval for, our product candidates and as we continue to fund the Pelican matching funds required in order to access the CPRIT Grant. In addition, if we obtain marketing approval for any of our product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution. Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations. Adequate additional financing may not be available to us on acceptable terms, or at all. If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce or eliminate our research and development programs or any future commercialization efforts. To meet our capital needs, we intend to continue to consider multiple alternatives, including, but not limited to, additional equity financings such as sales of our common stock under the H.C. Wainwright Sales Agreement if available, debt financings, partnerships, collaborations and other funding transactions. This is based on our current estimates, and we could use our available capital resources sooner than we currently expect. We are continually evaluating various cost-saving measures in light of our cash requirements in order to focus our resources on our product candidates. We will need to generate significant revenues to achieve profitability, and we may never do so. As of June 30, 2018, we had approximately $24.7 million in cash and cash equivalents.


Our cash and cash equivalents are currently held in an interest-bearing checking account and money market accounts.


Cash Flows


Operating activities.  The use of cash in all periods resulted primarily from our net losses adjusted for non-cash charges and changes in the components of working capital. The increase in cash used in operating activities for the six months ended June 30, 2018 compared to the six months ended June 30, 2017 is primarily due to an increase in pre-clinical activities associated with our PTX programs.


Investing activities.  The use of cash in all periods was related to the purchase of property and equipment. The increase is due to the purchase of lab equipment as we establish our San Antonio facilities per the CPRIT Grant.


Financing activities. Cash provided by financing activities during the six months ended June 30, 2018 was primarily from the  May 7, 2018 public offering which generated net proceeds of approximately $18.8 million and an additional $4.8 million from the exercise of warrants, as well as approximately $3.4 million net proceeds from the HCW sales agreement.

Cash provided by financing activities during the six months ended June 30, 2017 was from the March 2017 public offering which generated net proceeds of approximately $4.1 million, as well as $2.3 million net proceeds from the FBR sales agreement.


Funding Requirements


We believe that our existing cash and cash equivalents will be sufficient to meet our anticipated cash needs for the next twelve months. However, we expect to incur additional expenses as we continue our research and development programs. To meet our future financing needs, we intend to continue to consider multiple alternatives, including, but not limited to, additional equity financings, debt financings, partnerships, collaborations and other funding transactions. We are continually evaluating and monitoring our cash requirements and look to implement cost savings measures when necessary.


OFF-BALANCE SHEET ARRANGEMENTS


We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined under Securities and Exchange Commission rules.


ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.


Not applicable to smaller reporting companies.




24



 


ITEM 4.

CONTROLS AND PROCEDURES.


Evaluation of Disclosure Controls and Procedures


Our management, with the participation of our Chief Executive Officer and Vice President of Finance, evaluated the effectiveness of our disclosure controls and procedures as of June 30, 2018. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. We have adopted and maintain disclosure controls and procedures (as defined Rules 13a-15(e) and 15d-15(e) under the Exchange Act) that are designed to provide reasonable assurance that information required to be disclosed in the reports filed under the Exchange Act, such as this Quarterly Report on Form 10-Q, is collected, recorded, processed, summarized and reported within the time periods specified in the rules of the SEC. The Company’s disclosure controls and procedures are also designed to ensure that such information is accumulated and communicated to management to allow timely decisions regarding required disclosure.  Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of June 30, 2018 our Chief Executive Officer and Vice President of Finance concluded that, as of such a date, our disclosure controls and procedures were effective at the reasonable assurance level.


Changes in Internal Control over Financial Reporting

 

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) occurred during the quarter ended June 30, 2018 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.





25



 


PART II—OTHER INFORMATION 


ITEM 1.

LEGAL PROCEEDINGS.


From time to time we may become involved in legal proceedings or be subject to claims arising in the ordinary course of our business. We are not presently a party to any legal proceedings that, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, financial condition or cash flows. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.


ITEM 1A.

RISK FACTORS.


The following information and updates should be read in conjunction with the information disclosed in Part 1, Item 1A, “Risk Factors,” contained in our 2017 Annual Report. Except as disclosed below, there have been no material changes from the risk factors and uncertainties disclosed in our 2017 Annual Report.


We have incurred net losses every year since our inception and expect to continue to generate operating losses and experience negative cash flows and it is uncertain whether we will achieve profitability.


For the six months ended June 30, 2018 and 2017, we incurred a net loss of approximately $8.0 million and $6.5 million, respectively. We have an accumulated deficit of approximately $76.4 million through June 30, 2018. For the years ended December 31, 2017 and 2016, we incurred a net loss of approximately $12.4 million and $13.0 million, respectively. We had an accumulated deficit of approximately $68.8 million through December 31, 2017. We expect to continue to incur operating losses until such time, if ever, as we are able to achieve sufficient levels of revenue from operations. Our ability to achieve profitability will depend on us obtaining regulatory approval for our product candidates and market acceptance of our product offerings and our capacity to develop, introduce and sell our products to our targeted markets. There can be no assurance that any of our product candidates will be approved for commercial sale, or even if our product candidates are approved for commercial sale that we will ever generate significant sales or achieve profitability. Accordingly, the extent of future losses and the time required to achieve profitability, if ever, cannot be predicted at this point.


Even if we succeed in developing and commercializing one or more product candidates, we expect to incur substantial losses for the foreseeable future and may never become profitable. We also expect to continue to incur significant operating expenses and anticipate that our expenses will increase substantially in the foreseeable future as we:


·  continue to undertake preclinical development and conduct clinical trials for product candidates;

·  seek regulatory approvals for product candidates;

·  implement additional internal systems and infrastructure; and

·  hire additional personnel.


We also expect to experience negative cash flows for the foreseeable future as we fund our operating losses. As a result, we will need to generate significant revenues or raise additional financing in order to achieve and maintain profitability. We may not be able to generate these revenues or achieve profitability in the future. Our failure to achieve or maintain profitability would likely negatively impact the value of our securities and financing activities.


We will need to raise additional capital to operate our business and our failure to obtain funding when needed may force us to delay, reduce or eliminate our development programs or commercialization efforts.


During the six months ended June 30, 2018, our operating activities used net cash of approximately $11.8 million and as of June 30, 2018, our cash and cash equivalents were approximately $24.7 million. During the year ended December 31, 2017, our operating activities used net cash of approximately $6.3 million and as of December 31, 2017, our cash and cash equivalents were approximately $9.8 million. We have experienced significant losses since inception and have a significant accumulated deficit. As of June 30, 2018, our accumulated deficit totaled approximately $76.4 million and as of December 31, 2017, our accumulated deficit totaled approximately $68.8 million on a consolidated basis. We expect to incur additional operating losses in the future and therefore expect our cumulative losses to increase. We do not expect to derive revenue from any significant source in the near future until we or our potential partners successfully commercialize our products. Despite cost-saving measures that we implemented, we expect our expenses to increase if and when we initiate and conduct Phase 3 and other clinical trials, and seek marketing approval for our product candidates. Until such time as we receive approval from the FDA and other regulatory authorities for our product candidates, we will not be permitted to sell our products and therefore will not have product revenues from the sale of products. For the foreseeable future, we will have to fund all of our operations and capital expenditures from equity and debt offerings, cash on hand, licensing fees and grants.



26



 


We expect that our current cash and cash equivalents will allow us to continue the enrollment of additional patients in the Phase 2 clinical trial for HS-110; however, if the trial design or size were to change, we may need to raise money earlier than anticipated. 


We will need to raise additional capital to fund our future operations and we cannot be certain that funding will be available on acceptable terms on a timely basis, or at all. To meet our future financing needs, we intend to consider multiple alternatives, including, but not limited to, current and additional equity financings, which we expect will include sales of common stock through at the market issuances, debt financings and/or funding from partnerships or collaborations. Our ability to raise capital through the sale of securities may be limited by the various rules of the SEC and the NASDAQ Capital Market that place limits on the number and dollar amount of securities that we may sell. There can be no assurance that we will be able to meet the requirements for use of at-market-issuance agreements, or to complete any such transactions on acceptable terms or otherwise. Any additional sources of financing will likely involve the issuance of our equity or debt securities, which will have a dilutive effect on our stockholders. To the extent that we raise additional funds by issuing equity securities, our stockholders may experience significant dilution. Any debt financing, if available, may involve restrictive covenants that may impact our ability to conduct our business. If we do not succeed in raising additional funds on acceptable terms, we may be unable to complete planned preclinical and clinical trials or obtain approval of our product candidates from the FDA and other regulatory authorities, or continue to maintain our listing on the NASDAQ Capital Market. In addition, we could be forced to delay, discontinue or curtail product development, forego sales and marketing efforts, and forego licensing in attractive business opportunities. Any additional sources of financing will likely involve the issuance of our equity or debt securities, which will have a dilutive effect on our stockholders.


We have never paid cash dividends and have no plans to pay cash dividends in the future.


Holders of shares of our common stock are entitled to receive such dividends as may be declared by our board of directors. To date, we have paid no cash dividends on our shares of our preferred or common stock and we do not expect to pay cash dividends in the foreseeable future. We intend to retain future earnings, if any, to provide funds for operations of our business. Therefore, any return investors in our preferred or common stock may have will be in the form of appreciation, if any, in the market value of their shares of common stock.


Certain provisions of the General Corporation Law of the State of Delaware, our bylaws and stockholder rights plan may have anti-takeover effects that may make an acquisition of our company by another company more difficult.


We are subject to the provisions of Section 203 of the General Corporation Law of the State of Delaware, which prohibits a Delaware corporation from engaging in any business combination, including mergers and asset sales, with an interested stockholder (generally, a 15% or greater stockholder) for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the business combination is approved in a prescribed manner. The operation of Section 203 may have anti-takeover effects, which could delay, defer or prevent a takeover attempt that a holder of our common stock might consider in its best interest.  Certain provisions of our bylaws including the ability of our board of directors to fill vacancies on our board of directors and advance notice requirements for stockholder proposals and nominations may prevent or frustrate attempts by our stockholders to replace or remove our management. In addition, the Rights issued pursuant to our stockholder rights plan that we implemented, if not redeemed or suspended, could result in the dilution of the stock ownership of a potential hostile acquirer, likely preventing acquisitions that have not been approved by our board of directors and therefore discouraging, delaying or preventing a change in control that stockholders may consider favorable.


ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

 

None that were not previously disclosed in our Current Reports on Form 8-K.


ITEM 3.

DEFAULTS UPON SENIOR SECURITIES.


Not Applicable.


ITEM 4.

MINE SAFETY DISCLOSURES.


Not Applicable.




27



 


ITEM 5.

OTHER INFORMATION.


None.


ITEM 6.

EXHIBITS.


The exhibits filed as part of this Quarterly Report on Form 10-Q are set forth on the Exhibit Index, which Exhibit Index is incorporated herein by reference.





28



 


SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


 

 

HEAT BIOLOGICS, INC.

 

 

 

 

 

 

 

 

Date: August 14, 2018

 

By: 

/s/ Jeffrey A. Wolf

 

 

 

Jeffrey A. Wolf

 

 

 

Chairman and Chief Executive Officer

 

 

 

(Principal executive officer)

 

 

 

 

Date: August 14, 2018

 

By:

/s/ Ann A. Rosar

 

 

 

Ann A. Rosar

 

 

 

Vice President of Finance

 

 

 

(Principal financial and accounting officer)









29



 


EXHIBIT INDEX


Exhibit No.

 

Description

1.1

 

Common Stock Sales Agreement, dated January 18, 2018, by and between Heat Biologics, Inc. and H.C. Wainwright & Co., LLC (incorporated by reference to Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission dated January 19, 2018 (File No. 001-35994).

3.1

 

Amended and Restated Bylaws of Heat Biologics, Inc. (incorporated by reference to Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission dated July 20, 2018 (File No. 001-35994).

4.1

 

Warrant Agency Agreement by and between Heat Biologics, Inc. and Continental Stock Transfer & Trust Company, as warrant agent, dated May 2, 2018 (incorporated by reference to Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission dated May 7, 2018 (File No. 001-35994).

4.2

 

Common Warrant (incorporated by reference to Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission dated May 7, 2018 (File No. 001-35994).

4.3

 

Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.16 to the Company’s Registration Statement on Form S-1 (File No. 333-224039), Amendment No. 1, filed with the SEC on April 19, 2018)

31.1*

 

Certification of Chief Executive Officer pursuant to Rules 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*

 

Certification of Vice President of Finance pursuant to Rules 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*

 

Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2*

 

Certification of Vice President of Finance pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS*

 

XBRL Instance Document

101.SCH*

 

XBRL Taxonomy Extension Schema Document

101.CAL*

 

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF*

 

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB*

 

XBRL Taxonomy Extension Label Linkbase Document

101.PRE*

 

XBRL Taxonomy Extension Presentation Linkbase Document

———————

*

Filed herewith.






30


EX-31.1 2 htbx_ex31z1.htm CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER Certification

EXHIBIT 31.1

 

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO RULE 13a-14 OR RULE 15d-14 OF THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Jeffrey Wolf, certify that:

 

 

1.

I have reviewed this quarterly report on Form 10-Q of Heat Biologics, Inc.;

 

 

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

 

4.

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

  

 

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

 

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

 

c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

 

d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

 

5.

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

 

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

 

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: August 14, 2018

By:

/s/ Jeffrey Wolf

 

 

Name: Jeffrey Wolf

 

 

Title: Chief Executive Officer

 

 

(Principal Executive Officer)




EX-31.2 3 htbx_ex31z2.htm CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER Certification

EXHIBIT 31.2

 

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO RULE 13a-14 OR RULE 15d-14 OF THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Ann Rosar, certify that:

 

 

1.

I have reviewed this quarterly report on Form 10-Q of Heat Biologics, Inc.;

 

 

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

 

4.

The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

 

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

 

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

 

c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

 

d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

  

 

5.

The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

 

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

 

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: August 14, 2018

By:

/s/ Ann Rosar

 

 

Name: Ann Rosar

 

 

Title: Vice President of Finance

 

 

(Principal Financial and Accounting Officer)

  




EX-32.1 4 htbx_ex32z1.htm CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER Certification

EXHIBIT 32.1

 

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

Pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Heat Biologics, Inc. (the “Registrant”) hereby certifies, to such officer’s knowledge, that:

 

 

(1)

the accompanying Quarterly Report on Form 10-Q of the Registrant for the quarter ended June 30, 2018 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

 

 

(2)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

 

Date: August 14, 2018

 

 

 

 

 

By:

/s/ Jeffrey Wolf

 

 

Name: Jeffrey Wolf

 

 

Title: Chief Executive Officer

 

 

(Principal Executive Officer)






EX-32.2 5 htbx_ex32z2.htm CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER Certification

EXHIBIT 32.2

 

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

Pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Heat Biologics, Inc. (the “Registrant”) hereby certifies, to such officer’s knowledge, that:

 

 

(1)

the accompanying Quarterly Report on Form 10-Q of the Registrant for the quarter ended June 30, 2018 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

 

 

(2)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

 

Date: August 14, 2018

 

 

 

 

 

By:

/s/ Ann Rosar

 

 

Name: Ann Rosar

 

 

Title: Vice President of Finance

 

 

(Principal Financial and Accounting Officer)




EX-101.INS 6 htbx-20180630.xml XBRL INSTANCE FILE 0001476963 2018-01-01 2018-06-30 0001476963 2018-06-30 0001476963 2016-12-31 0001476963 2011-03-01 2011-03-10 0001476963 2017-03-01 2017-03-23 0001476963 2011-03-10 0001476963 2013-07-22 2013-07-23 0001476963 htbx:WarrantsToPurchaseSharesOfCommonStockIssuableAtPriceThreeMember 2018-06-30 0001476963 2013-07-23 0001476963 htbx:EmployeesMember us-gaap:RestrictedStockMember 2017-04-01 2017-06-30 0001476963 us-gaap:EmployeeStockOptionMember 2017-04-01 2017-06-30 0001476963 htbx:NonEmployeesMember us-gaap:RestrictedStockMember 2017-04-01 2017-06-30 0001476963 us-gaap:WarrantMember 2018-06-30 0001476963 2017-12-31 0001476963 htbx:HeatBiologicsOneMember 2018-01-01 2018-06-30 0001476963 htbx:PelicanTherapeuticsIncMember 2018-01-01 2018-06-30 0001476963 htbx:HeatBiologicsOneMember 2017-12-31 0001476963 srt:MinimumMember 2018-01-01 2018-06-30 0001476963 srt:MaximumMember 2018-01-01 2018-06-30 0001476963 us-gaap:FurnitureAndFixturesMember 2018-06-30 0001476963 us-gaap:ComputerEquipmentMember 2018-06-30 0001476963 us-gaap:EquipmentMember 2018-06-30 0001476963 us-gaap:FurnitureAndFixturesMember 2017-12-31 0001476963 us-gaap:ComputerEquipmentMember 2017-12-31 0001476963 us-gaap:EquipmentMember 2017-12-31 0001476963 us-gaap:EmployeeStockOptionMember 2018-01-01 2018-06-30 0001476963 us-gaap:RestrictedStockMember 2018-01-01 2018-06-30 0001476963 htbx:CommonStockWarrantMember 2018-01-01 2018-06-30 0001476963 htbx:PelicanTherapeuticsIncMember 2018-06-30 0001476963 us-gaap:CommonStockMember 2018-01-01 2018-06-30 0001476963 us-gaap:CommonStockMember 2017-12-31 0001476963 us-gaap:CommonStockMember 2018-06-30 0001476963 us-gaap:AdditionalPaidInCapitalMember 2018-01-01 2018-06-30 0001476963 us-gaap:AdditionalPaidInCapitalMember 2017-12-31 0001476963 us-gaap:AdditionalPaidInCapitalMember 2018-06-30 0001476963 us-gaap:RetainedEarningsMember 2018-01-01 2018-06-30 0001476963 us-gaap:RetainedEarningsMember 2017-12-31 0001476963 us-gaap:RetainedEarningsMember 2018-06-30 0001476963 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-01-01 2018-06-30 0001476963 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2017-12-31 0001476963 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-06-30 0001476963 us-gaap:NoncontrollingInterestMember 2018-01-01 2018-06-30 0001476963 us-gaap:NoncontrollingInterestMember 2017-12-31 0001476963 us-gaap:NoncontrollingInterestMember 2018-06-30 0001476963 2017-01-01 2017-12-31 0001476963 htbx:PelicanTherapeuticsIncMember htbx:FirstTrancheMember us-gaap:GrantMember 2017-05-01 2017-05-31 0001476963 htbx:PelicanTherapeuticsIncMember htbx:SecondTrancheMember us-gaap:GrantMember 2017-10-01 2017-10-31 0001476963 htbx:PelicanTherapeuticsIncMember us-gaap:StockholdersEquityTotalMember 2018-01-01 2018-06-30 0001476963 htbx:WarrantsToPurchaseSharesOfCommonStockIssuableAtPriceOneMember 2018-06-30 0001476963 us-gaap:EmployeeStockOptionMember 2018-01-01 2018-06-30 0001476963 htbx:EmployeesMember us-gaap:RestrictedStockMember 2018-01-01 2018-06-30 0001476963 htbx:NonEmployeesMember us-gaap:RestrictedStockMember 2018-01-01 2018-06-30 0001476963 htbx:EmployeesMember 2018-06-30 0001476963 htbx:SalesAgreementMember 2018-01-01 2018-06-30 0001476963 htbx:SalesAgreementMember 2018-06-30 0001476963 us-gaap:GrantMember 2018-01-01 2018-06-30 0001476963 htbx:PelicanTherapeuticsIncMember us-gaap:GrantMember 2018-01-01 2018-06-30 0001476963 2018-01-01 2018-01-19 0001476963 2018-08-10 0001476963 2017-04-01 2017-06-30 0001476963 2018-04-01 2018-06-30 0001476963 2017-01-01 2017-06-30 0001476963 2017-06-30 0001476963 us-gaap:EmployeeStockOptionMember 2018-04-01 2018-06-30 0001476963 htbx:EmployeesMember us-gaap:RestrictedStockMember 2018-04-01 2018-06-30 0001476963 htbx:NonEmployeesMember us-gaap:RestrictedStockMember 2018-04-01 2018-06-30 0001476963 htbx:NonEmployeesMember us-gaap:RestrictedStockMember 2017-01-01 2017-06-30 0001476963 us-gaap:EmployeeStockOptionMember 2017-01-01 2017-06-30 0001476963 us-gaap:RestrictedStockMember 2017-01-01 2017-06-30 0001476963 htbx:CommonStockWarrantMember 2017-01-01 2017-06-30 0001476963 htbx:PelicanTherapeuticsIncMember 2017-06-30 0001476963 us-gaap:GrantMember 2018-04-01 2018-06-30 0001476963 2018-05-07 0001476963 2018-05-01 2018-05-07 0001476963 us-gaap:EmployeeStockOptionMember 2017-01-01 2017-06-30 0001476963 htbx:EmployeesMember us-gaap:RestrictedStockMember 2017-01-01 2017-06-30 0001476963 us-gaap:WarrantMember 2018-05-01 2018-05-07 0001476963 us-gaap:WarrantMember 2018-05-07 0001476963 htbx:PreFundedWarrantMember 2018-05-07 0001476963 htbx:PelicanTherapeuticsIncMember us-gaap:GrantMember 2016-06-01 2016-06-30 0001476963 2017-03-23 0001476963 htbx:CommonStockWarrantMember 2018-05-07 0001476963 2018-05-01 2018-05-31 0001476963 us-gaap:GrantMember 2017-04-01 2017-06-30 0001476963 us-gaap:GrantMember 2017-01-01 2017-06-30 0001476963 us-gaap:GrantMember us-gaap:InProcessResearchAndDevelopmentMember 2017-04-01 2017-06-30 0001476963 us-gaap:GrantMember us-gaap:InProcessResearchAndDevelopmentMember 2017-01-01 2017-06-30 iso4217:USD xbrli:shares iso4217:USD xbrli:shares xbrli:pure HEAT BIOLOGICS, INC. 0001476963 10-Q 2018-06-30 false --12-31 Smaller Reporting Company Q2 2018 645734 286891 -76423163 -68846326 25447142 5780909 840 4619 76382262 103953477 -68846326 -76423163 -166025 -94754 -1589842 -1993037 0.0002 0.0002 100000000 100000000 23093584 4200310 23093584 4200310 512120 19686 123418 10500 242147 265228 802 402349 108340 31097 802 21000 245142 136207 14375000 1300000 4875000 1198573 742649 55883 26383 1116307 55883 41333 645433 552839 455758 424592 296159 266884 62207 173336 15628 3.97 0.00 0.00 0.8396 0.0234 0.0278 P6Y3M19D P5Y 424592 P8Y6M 12.72 161461 P7Y4M24D 24.06 424592 62207 4443230 252000 30623 310397 156141 160559 12017121 14408567 HTBX 0 0 0 0 28682801 11745157 4007815 1967257 8135728 8157428 79220 69798 1170 2292 37464263 20189476 7398373 10336499 1445867 2276431 200000 821822 1033680 37464263 20189476 -1993037 -1589842 27440179 7370751 -94754 -166025 103953477 76382262 4619 840 7800000 24660733 9763067 3573380 3400000 2461880 18800000 4800000 3573380 281 3573099 1403367 2437500 23103584 14253 14833 2049096 2049096 512120 12 512108 71271 71271 1226998 1504240 88518 542434 18051 27457 2189338 2189338 2189338 -7980032 -7576837 -403195 -3309081 -4246805 -6549809 -7576837 1200000 -3218915 -4050071 -6408853 3160387 2609289 2385000 -403195 -161994 -241201 -90166 -196734 -140956 1302220 1302220 82300 162300 30000 40000 551098 5130684 7026388 1895704 800000 1800000 6500000 1900000 1900000 411250 1143177 435490 1100000 15200000 400000 400000 20000 20000 5866000 5866000 30000 0.9250 1.584 4.80 125.00 125.00 10.00 10.00 1.30 10.00 P5Y P5Y P5Y 1738 682500 12500 7187500 P10Y 4132833 2.84 1403367 32.80 P5Y P7Y 3810178 1551597 31250 218750 146387 87937 20000 108973 12.72 19.57 0.80 0.80 3658000 Yes 1522789 P1Y5M9D When the reverse stock split became effective, every 10 shares of our issued and outstanding common stock were combined into one share of common stock. Effecting the reverse stock split reduced the number of issued and outstanding common stock from approximately 42 million shares to approximately 4.2 million. 18800000 15200000 1122 98879 0.21 .34 133106 0.0499 500000 300000 539980 5900000 0.2000 7600000 -7505566 -3228575 -4000125 -6484888 -403195 -90166 -196734 -140956 -7908761 -3318741 -4196859 -6625844 71271 -9660 49946 -76035 9894367 3524483 14727682 3112412 -0.77 -0.91 -0.27 -2.06 169593 14182 -9060 89130 121796 7716 -53224 77443 47797 6466 44164 11687 -8149625 -3323263 -4237745 -6638939 10045329 3734513 5380922 7074429 551098 539980 3141505 1582581 1361166 3109596 6352726 2151932 3479776 3964833 20699997 2875 20697122 108408 66671 -11773894 -5521921 -4418 -21816 -830162 -767418 -1895704 1409212 -211858 -202244 2044397 -68591 -473 -72543 -467251 -484090 467251 15289 468801 20699997 4183000 2049096 239617 27062874 6405263 74815 4971 14896544 404223 24661903 7943838 9765359 8348061 1052000 4838593 611 4837982 1052000 3937000 31199 5866000 2111760 -1102777 935000 3937000 -0.77 -0.88 -0.27 -2.07 -7576837 -3220283 -4050071 -6721593 403195 90508 196734 219142 -7980032 -3310791 -4246805 -6940735 1895704 411250 1143177 435490 -9422 4838593 -30000 3054667 4900000 5100000 3400000 0.0649 3000000 7500000 3000000 7500000 3000000 7500000 3000000 6000000 3000000 1500000 2000000 0.01 1.2414 200000 0.0002 1.584 1.584 0.01 1.43 1.44 3054667 3054667 4750000 9500000 <p style="margin: 0px"><font style="background-color: #FFFFFF"><b>1. Basis of Presentation and Significant Accounting Policies</b></font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF"><b><i>Basis of Presentation and Principles of Consolidation</i></b></font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">On January 19, 2018, the Company announced a reverse stock split of its shares of common stock at a ratio of one-for-ten. The reverse stock split took effect at 11 p.m. ET on January 19, 2018, and the Company&#146;s common stock began to trade on a post-split basis at the market open on January 22, 2018. During the Company&#146;s annual stockholders meeting held June 29, 2017, stockholders approved the Company&#146;s reverse stock split and granted the board of directors the authority to implement and determine the exact split ratio within a specified range. When the reverse stock split became effective, every 10 shares of our issued and outstanding common stock were combined into one share of common stock. Effecting the reverse stock split reduced the number of issued and outstanding common stock from approximately 42 million shares to approximately 4.2 million. It also subsequently adjusted outstanding options issued under the Company&#146;s equity incentive plan and outstanding warrants to purchase common stock. </p> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">The accompanying unaudited consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the United States of America (&#147;U.S. GAAP&#148;) for interim financial reporting. However, certain information or footnote disclosures normally included in complete financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the &#147;SEC&#148;). In the opinion of the Company&#146;s management, the unaudited consolidated financial statements in this Quarterly Report on Form 10-Q include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending December&#160;31, 2018. </font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">The consolidated financial statements as of and for the six months ended June 30, 2018 and 2017 included in this Quarterly Report on Form 10-Q are unaudited. The balance sheet as of December 31, 2017 is derived from the audited consolidated financial statements as of that date. The accompanying unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes, together with Management&#146;s Discussion and Analysis of Financial Condition and Results of Operations, contained in the Company&#146;s Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on March 2, 2018 (the &#147;2017 Annual Report&#148;). </font></p> <p style="margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">On April 28, 2017, the Company completed the acquisition of an 80% controlling interest in Pelican Therapeutics, Inc. (&#147;Pelican&#148;), a related party prior to acquisition. Operations of Pelican are included in the consolidated statements of operations and comprehensive loss from the acquisition date. </font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">The accompanying consolidated financial statements as of and for the six months ended June 30, 2018 and 2017 include the accounts of Heat Biologics, Inc. (&#147;the Company&#148;), and its subsidiaries, Heat Biologics I, Inc. (&#147;Heat I&#148;), Heat Biologics III, Inc. (&#147;Heat III&#148;), Heat Biologics IV, Inc. (&#147;Heat IV&#148;), Heat Biologics GmbH, Heat Biologics Australia Pty Ltd. and Zolovax. Additionally, as of the six months ended June 30, 2018 the accompanying consolidated financials include Pelican. The functional currency of the entities located outside the United States is the applicable local currency (the foreign entities). Assets and liabilities of the foreign entities are translated at period-end exchange rates. &#160;Statement of operations accounts are translated at the average exchange rate during the period. The effects of foreign currency translation adjustments are included in other comprehensive loss, which is a component of accumulated other comprehensive loss in stockholders&#146; equity. All significant intercompany accounts and transactions have been eliminated in consolidation. At December 31, 2017 and June 30, 2018, the Company held a 92.5% controlling interest in Heat I and an 80% controlling interest in Pelican. All other subsidiaries are wholly owned. For the six months ended June 30, 2018 the Company recognized $161,994 in net loss non-controlling interest for Heat I and $241,201 in net loss non-controlling interest for Pelican. The Company accounts for its less than 100% interest in these subsidiaries in the consolidated financial statements in accordance with U.S. GAAP. Accordingly, the Company presents non-controlling interests as a component of stockholders&#146; equity on its consolidated balance sheets and reports non-controlling interest net loss under the heading &#147;net loss &#150; non-controlling interest&#148; in the consolidated statements of operations and comprehensive loss. </font></p> <p style="margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The Company has an accumulated deficit of approximately $76.4 million as of June 30, 2018 and a net loss of approximately $8.0 million for the six months ended June 30, 2018 and has not generated significant revenue or positive cash flows from operations. In May 2018, through a public offering, the Company raised approximately $18.8 million, net of underwriting discounts and commissions and other estimated offering expenses, and an additional $4.8 million through the exercise of 3,054,667 warrants.<a name="Hlk497836823"></a> On April 28, 2017, the acquisition of an 80% controlling interest in Pelican, a related party prior to acquisition, was completed. Pelican has been awarded a $15.2 million grant to fund preclinical and some clinical activities from the Cancer Prevention and Research Institute of Texas (&#147;CPRIT&#148;). The CPRIT grant is subject to customary CPRIT funding conditions. The Company believes the acquisition aligns its strategic focus and strengthens its position in the T-cell activation arena. </p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Cash Equivalents and Restricted Cash</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The Company considers all highly liquid instruments with an original maturity of six months or less to be cash equivalents. Restricted cash consists of deposits held by the US Patent and Trademark Office.</font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Use of Estimates</i></b></font></p> <p style="line-height: 11pt; margin: 0px; text-align: justify"><br /></p> <p style="line-height: 11pt; margin: 0px">The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that&#160;affect the amounts reported in the financial statements and accompanying notes. Estimates are&#160;used for, but not limited to, useful lives of fixed assets, income taxes and stock-based compensation. Actual results may differ from those estimates.</p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Segments</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The Company has one reportable segment - the development of immunotherapies designed to activate and expand a patient's T-cell mediated immune system against cancer.</font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Business Combinations</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The Company accounts for acquisitions using the acquisition method of accounting, which requires that all identifiable assets acquired and liabilities assumed be recorded at their estimated fair values. The excess of the fair value of purchase consideration over the fair values of identifiable assets and liabilities is recorded as goodwill. When determining the fair values of assets acquired and liabilities assumed, management makes significant estimates and assumptions.</p> <p style="line-height: 11pt; margin: 0px">&#160;</p> <p style="line-height: 11pt; margin: 0px">Critical estimates in valuing certain intangible assets include but are not limited to future expected cash flows from acquired patented technology. Management&#146;s estimates of fair value are based upon assumptions believed to be reasonable, but are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. Other estimates associated with the accounting for acquisitions may change as additional information becomes available regarding the assets acquired and liabilities assumed (see Note 2).</p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Goodwill&#160;and In-Process Research and Development</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The Company classifies intangible assets into three categories: (1)&#160;intangible assets with definite lives subject to amortization, (2)&#160;intangible assets with indefinite lives not subject to amortization and (3)&#160;goodwill. The Company determines the useful lives of definite-lived intangible assets after considering specific facts and circumstances related to each intangible asset. Factors the Company considers when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, and other economic facts; including competition and specific market conditions. Intangible assets that are deemed to have definite lives are amortized, primarily on a straight-line basis, over their estimated useful lives.</p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">Intangible assets that are deemed to have indefinite lives, including goodwill, are reviewed for impairment annually on the anniversary of the acquisition, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test for indefinite-lived intangibles, other than goodwill, consists of a comparison of the fair value of the intangible asset with its carrying amount. If the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess. Indefinite-lived intangible assets, such as goodwill, are not amortized. The Company will qualitatively test the carrying amounts of goodwill for recoverability on an annual basis or when events or changes in circumstances indicate evidence a potential impairment exists, using a fair value-based test. No impairment existed at June 30, 2018.</p> <p style="margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">In-process research and development, or IPR&#38;D, assets are considered to be indefinite-lived until the completion or abandonment of the associated research and development projects. IPR&#38;D assets represent the fair value assigned to technologies that the Company acquires, which at the time of acquisition have not reached technological feasibility and have no alternative future use. During the period that the assets are considered indefinite-lived, they are tested for impairment on an annual basis, or more frequently if the Company becomes aware of any events occurring or changes in circumstances that indicate that the fair value of the IPR&#38;D assets are less than their carrying amounts. If and when development is complete, which generally occurs upon regulatory approval and the ability to commercialize products associated with the IPR&#38;D assets, these assets are then deemed definite-lived and are amortized based on their estimated useful lives at that point in time. If development is terminated or abandoned, the Company may have a full or partial impairment charge related to the IPR&#38;D assets, calculated as the excess of carrying value of the IPR&#38;D assets over fair value. No impairment existed at June 30, 2018.</p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Contingent Consideration</i></b></font></p> <p style="line-height: 11pt; margin: 0px; text-indent: 24px; text-align: justify">&#160;</p> <p style="line-height: 11pt; margin: 0px">Consideration paid in a business combination may include potential future payments that are contingent upon the acquired business achieving certain milestones in the future (&#147;contingent consideration&#148;). Contingent consideration liabilities are measured at their estimated fair value as of the date of acquisition, with subsequent changes in fair value recorded in the consolidated statements of operations. The Company estimates the fair value of the contingent consideration as of the acquisition date using the estimated future cash outflows based on the <a name="Hlk490152250"></a>probability of meeting future milestones. The milestone payments will be made upon the achievement of clinical and commercialization milestones as well as single low digit royalty payments and payments upon receipt of sublicensing income. Subsequent to the date of acquisition, <font style="font-family: Times,Times New Roman">the Company <a name="Hlk511038718"></a>will reassess </font>the actual consideration earned and the probability-weighted future earn-out payments at each balance sheet date. Any adjustment to the contingent consideration liability will be recorded in the consolidated statements of operations. Contingent consideration liabilities are presented in long-term liabilities in the consolidated balance sheets (see Note 2). </p> <p style="line-height: 11pt; margin: 0px"><br /></p> <a name="Hlk513711148"></a><p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Revenue Recognition</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">Effective January 1, 2018, the Company has adopted on a modified retrospective basis Accounting Standards Codification (ASC) Topic 606. </font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The Company&#146;s sole source of revenue is grant revenue related to the CPRIT Contract, which is being accounted for under ASC 606. ASC 606 introduces a new framework for analyzing potential revenue transactions by identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations in the contract, and recognizing revenue when (or as) the Company satisfies a performance obligation.</font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The performance obligations of the CPRIT Contract include developing a human TNFRSF25 agonist antibody for use in cancer patients through research and development efforts and a noncommercial license from CPRIT-funded research to CPRIT and other government agencies and institutions of higher education in Texas. </font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">Management has concluded that the license and R&#38;D services should be combined into a single performance obligation as both are highly interdependent - a license cannot be effectively granted without the corresponding research basis and CPRIT cannot benefit from the license without the R&#38;D services and are therefore not capable of being distinct. </font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">The CPRIT grant covers a three-year period from June 1, 2017 through May 31, 2019, for a total grant award of up to $15.2 million. CPRIT advances grant funds upon request by the Company consistent with the agreed upon amounts and schedules as provided in the contract. The first tranche of funding of $1.8 million was received in May 2017, and a second tranche of funding of $6.5 million was received in October 2017. The next tranche of funding is expected to be requested and received in late 2018. Funds received are reflected in deferred revenue as a liability until revenue is earned. &#160;Grant revenue is recognized when qualifying costs are incurred. </p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Deferred Revenue</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px">As of June 30, 2018, deferred revenue is comprised of proceeds of $4.9 million received from CPRIT for which the costs have not been incurred or the conditions of the award have not been met and $0.2 million of grant funds received from an economic development grant agreement with the City of San Antonio (&#147;Economic Development Grant&#148;), for the purpose of defraying costs toward the purchase of laboratory equipment. As of June 30, 2018, the deferred revenue balance was $5.1 million with $3.4 million recognized as revenue from CPRIT since the CPRIT contract inception. </p> <p style="line-height: 11pt; margin: 0px; text-align: justify"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Prepaid Expenses and Other Current Assets</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">The Company&#146;s prepaid expenses and other current assets consists primarily of the amount paid in advance for cGMP production of Pelican&#146;s PTX-35 antibody and PTX-15 fusion protein, as well as Chemistry Manufacturing and Control (&#147;CMC&#148;) material for the Company&#146;s clinical trial studies for HS-110. </font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Income Taxes</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The Company accounts for income taxes using the asset and liability method, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent that utilization is not presently more likely than not.</font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Significant Accounting Policies</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The significant accounting policies used in preparation of these interim financial statements are disclosed in the Company's Form 10-K and have not changed significantly since such filing.</p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Recently Issued Accounting Pronouncements</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">In June 2018, the FASB issued ASU 2018-07: <i>Compensation &#150; Stock Compensation (Topic 718)</i>: Improvements to Nonemployee Share-Based Payment Accounting. This ASU expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees, and as a result, the accounting for share-based payments to non-employees will be substantially aligned. ASU 2018-07 is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year, early adoption is permitted but no earlier than an entity&#146;s adoption date of Topic 606. <font style="background-color: #FFFFFF">The Company has not determined the impact of this standard and does not plan early adoption of this standard.</font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">In January 2017, the FASB issued ASU No.&#160;2017-01,&#160;<i>Business Combinations (Topic 805)&#160;</i>to clarify the definition of a business, which is fundamental in the determination of whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses combinations. The updated guidance requires that in order to be considered a business the integrated set of assets and activities acquired must include, at a minimum, an input and process that contribute to the ability to create output. If substantially all of the fair value of the assets acquired is concentrated in a single identifiable asset or group of similar assets, it is not considered a business, and therefore would not be considered a business combination. The update is effective for fiscal years beginning after December 15, 2018, and interim periods with fiscal years beginning after December 15, 2019, with early adoption permitted. <font style="background-color: #FFFFFF">The Company has not determined the impact of this standard and does not plan early adoption of this standard.</font></p> <p style="margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">In August 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230)&#151;Restricted Cash. ASU 2016-18 requires the statement of cash flows to be a reconciliation between beginning and ending cash balances inclusive of restricted cash balances. ASU 2016-18 is effective for fiscal years beginning after December 15, 2017 and is to be applied using a retrospective transition method to each period presented. The Company adopted this ASU for the year ending December 31, 2018. The adoption of this standard resulted in the removal of changes in Restricted Cash from the Consolidated Statements of Cash Flows of $1,122 and $98,879 for the six months ended June 30, 2018 and 2017, respectively and inclusion of these amounts as part of the starting and ending cash balances.</p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">In February 2016, the FASB issued ASU 2016-02,&#160;<i>Leases (Topic 842)</i>, requiring lessees to recognize for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee&#146;s obligation to make lease payments arising from a lease, measured on a discounted basis, and (2) a right-of-use (&#147;ROU&#148;) asset, which is an asset that represents the lessee&#146;s right to use, or control the use of, a specified asset for the lease term. The update is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2020. The Company currently anticipates that upon adoption of the new standard, ROU assets and lease liabilities will be recognized in amounts that will be immaterial to the consolidated balance sheets.</p> <p style="line-height: 11pt; margin: 0px"></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b>2. Acquisition of Pelican Therapeutics</b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px; font-family: Times,Times New Roman">On April 28, 2017, the Company consummated the acquisition of 80% of the outstanding equity of Pelican, a related party, and Pelican became a majority owned subsidiary of the Company. Operations of Pelican are included in the consolidated statements of operations and comprehensive loss from the acquisition date. Pelican is a biotechnology company focused on the development and commercialization of monoclonal antibody and fusion protein-based therapies that are designed to activate the immune system. In exchange for 80% of the outstanding capital stock of Pelican on a fully diluted basis, the Company paid to the Pelican Stockholders that executed the Stock Purchase Agreement (the &#147;Participating Pelican Stockholders&#148;) an aggregate of $0.5 million minus certain liabilities (the &#147;Cash Consideration&#148;), and issued to the Participating Pelican Stockholders 133,106 shares of the Company&#146;s restricted common stock representing 4.99% of the outstanding shares of our common stock on the date of the initial execution of the Purchase Agreement (the &#147;Stock Consideration&#148;). During the six months ended June 30, 2018, the Cash Consideration of approximately $0.3 million was distributed to the Participating Pelican Stockholders and the remainder of approximately $0.2 million for certain Pelican liabilities not satisfied was recognized as other income in the Consolidated Statements of Operations and Comprehensive Loss. <font style="font-family: Times New Roman">&#160;</font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">Under the agreement, the Company is also obligated to make future payments based on the achievement of certain clinical and commercialization milestones, as well as low single digit royalty payments and payments upon receipt of sublicensing income: </p> <p style="margin: 0px"><br /></p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; float: left">(1)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$2,000,000 upon Pelican&#146;s dosing of the first patient in its first Phase 1 trial for an oncology indication;</p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; clear: left; float: left">(2)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$1,500,000 upon Pelican&#146;s dosing of the first patient in its first Phase 2 trial for an oncology indication;</p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; clear: left; float: left">(3)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$3,000,000 upon successful outcome of the first Phase 2 trial for an oncology indication;</p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; clear: left; float: left">(4)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$6,000,000 upon Pelican&#146;s dosing of the first patient in its first Phase 3 trial for an oncology indication;</p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; clear: left; float: left">(5)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$3,000,000 upon Pelican&#146;s dosing of the first patient in its first Phase 3 trial for a non- oncology indication;</p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; clear: left; float: left">(6)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$7,500,000 upon successful outcome of the first Phase 3 trial for an oncology indication;</p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; clear: left; float: left">(7)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$3,000,000 upon successful outcome of the first Phase 3 trial for a non-oncology indication;</p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; clear: left; float: left">(8)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$7,500,000 upon acceptance of a Biologics License Application (BLA) submission for an oncology indication;</p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; clear: left; float: left">(9)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$3,000,000 upon acceptance of a BLA submission for a non-oncology indication;</p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; clear: left; float: left">(10)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$7,500,000 upon first product indication approval in the United States or Europe for an oncology indication;</p> <p style="margin-top: 0px; margin-bottom: -2px; text-indent: 48px; width: 80px; clear: left; float: left">(11)</p> <p style="margin: 0px; padding-left: 80px; text-indent: -2px">$3,000,000 upon first product indication approval in the United States or Europe for a non-oncology indication.</p> <p style="margin: 0px; clear: left; text-align: justify"><br /></p> <p style="margin: 0px">The fair value of these future milestone payments is reflected in the contingent consideration account under long term liabilities on the balance sheet.<font style="background-color: #FFFFFF"> The estimated fair value of the contingent consideration was determined using a probability-weighted income approach, at a discount of 6.49% based on the median yield of publicly traded non-investment grade debt of companies in the pharmaceutical industry. </font><font style="font-family: Times,Times New Roman">The Company performs an analysis on a quarterly basis and as of June 30, 2018, the Company determined the change in the estimated fair value of the contingent consideration was $539,980 for the quarter ended June 30, 2018. </font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">The Company has recorded the assets purchased and liabilities assumed at their estimated fair value in accordance with FASB ASC Topic 805:&#160;<i>Business Combinations</i>. The purchase price exceeded the fair value of the net assets acquired resulting in goodwill of approximately $2.2 million. The identifiable indefinite-lived intangible asset consists of in-process R&#38;D of approximately $5.9 million. <font style="background-color: #FFFFFF">The estimated fair value of the IPR&#38;D was determined using a probability-weighted income approach, which discounts expected future cash flows to present value. The projected cash flows were based on certain key assumptions, including estimates of future revenue and expenses, taking into account the stage of development of the technology at the acquisition date and the time and resources needed to complete development. The Company utilized corporate bond yield data observed in the bond market to develop the discount rate utilized in the cash flows that have been probability adjusted to reflect the risks of product commercialization, which the Company believes are appropriate and representative of market participant assumptions. </font>Operations of the acquired entity are included in the consolidated statements of operations from the acquisition date.&#160;<font style="background-color: #FFFFFF"> </font></p> <p style="margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The purchase price has been allocated to the assets and liabilities as follows:&#160;</p> <p style="line-height: 11pt; margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 7.93px"></td><td style="width: 8.06px"></td><td style="width: 75.53px"></td><td style="width: 4.46px"></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify"><b>Aggregate consideration:</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td colspan="2" style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 83.6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Cash consideration</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">500,000</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Stock consideration</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">1,052,000</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Contingent consideration </p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">2,385,000</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify"><b>Total Consideration</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px"><b>$</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right"><b>3,937,000</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; text-align: justify"><b>Purchase price allocation:</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Cash acquired</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">31,199</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; text-align: justify">In-process R&#38;D</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">5,866,000</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Goodwill</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">2,189,338</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Deferred tax liability</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">(2,111,760</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Net liabilities assumed</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">(1,102,777</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Fair value of non-controlling interest</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">(935,000</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify"><b>Total purchase price</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px"><b>$</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right"><b>3,937,000</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> </table> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">Goodwill is calculated as the difference between the acquisition-date fair value of the consideration transferred and the fair values of the assets acquired and liabilities assumed. The goodwill resulting from this acquisition arises largely from synergies expected from combining the operations. The goodwill is not deductible for income tax purposes.</font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">In-process R&#38;D assets are treated as indefinite-lived until the completion or abandonment of the associated R&#38;D program, at which time the appropriate useful lives will be determined.</p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">The Company calculated the fair value of the non-controlling interest acquired in the acquisition as 20% of the equity interest of Pelican, adjusted for a minority interest discount.</p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">In May 2016, Pelican was awarded a $15.2 million CPRIT Grant from CPRIT for development of Pelican&#146;s lead product candidate, PTX-35. The CPRIT Grant is expected to allow Pelican to develop PTX-35 through a 70-patient Phase 1 clinical trial. The Phase 1 clinical trial will be designed to evaluate PTX-35 in combination with other immunotherapies. The CPRIT Grant is subject to customary CPRIT funding conditions including a matching funds requirement where Pelican will match $0.50 for every $1.00 from CPRIT. Consequently, Pelican is required to raise $7.6 million in matching funds over the three year project. </p> <p style="margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">Pelican has contributed net revenue of $1.9 million and net loss of $1.2 million, respectively, which are included in the Company&#146;s consolidated statement of operations and comprehensive loss for the six months ended June 30, 2018. </p> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">The following unaudited pro forma information presents the combined results of operations for the three and six months ended June 30, 2018 and 2017, as if the Company had completed the Pelican acquisition at the beginning of fiscal 2017. The pro forma financial information is provided for comparative purposes only and is not necessarily indicative of what actual results would have been had the acquisition occurred on the date indicated, nor does it give effect to synergies, cost savings, fair market value adjustments, immaterial amortization expense and other changes expected to result from the acquisition. Accordingly, the pro forma financial results do not purport to be indicative of consolidated results of operations as of the date hereof, for any period ended on the date hereof, or for any other future date or period. </font></p> <p style="margin: 0px"><br /></p> <a name="Hlk520111448"></a><table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 6.66px"></td><td style="width: 6.66px"></td><td style="width: 74px"></td><td style="width: 14px"></td><td style="width: 6.66px"></td><td style="width: 75px"></td><td style="width: 6px"></td><td style="width: 6px"></td><td style="width: 6.66px"></td><td style="width: 74px"></td><td style="width: 7px"></td><td style="width: 7px"></td><td style="width: 7px"></td><td style="width: 75px"></td><td style="width: 6.66px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="5" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 176.33px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Three Months Ended</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td style="margin-top: 0px; vertical-align: top; width: 6px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="6" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 176.66px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Six Months Ended</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 80.66px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 81.66px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td style="margin-top: 0px; vertical-align: top; width: 6px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 80.66px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 7px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td style="margin-top: 0px; vertical-align: top; width: 7px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 82px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2017</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Revenue</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74px"><p style="margin: 0px; font-family: Times,Times New Roman; text-align: right">1,143,177</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75px"><p style="margin: 0px; font-family: Times,Times New Roman; text-align: right">411,250</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">1,895,704</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75px"><p style="margin: 0px; font-family: Times,Times New Roman; text-align: right">435,490</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6.66px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(4,246,805</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(3,310,791</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(7,980,032</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(6,940,735</p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss: Non-controlling interest</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(196,734</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(90,508</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(403,195</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(219,142</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss attributable to Heat Biologics, Inc.</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(4,050,071</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(3,220,283</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(7,576,837</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 7px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(6,721,593</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6.66px"><p style="margin: 0px">&#160;&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss per share attributable to Heat Biologics, Inc.&#151;basic and diluted</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(0.27</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(0.88</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(0.77</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 7px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(2.07</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> </table> <p style="margin: 0px"></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b>3. Fair Value of Financial Instruments</b></font></p> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The carrying amount of certain of the Company&#146;s financial instruments, including cash and cash equivalents, restricted cash, accounts payable and accrued expenses and other payables approximate fair value due to their short maturities. </p> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">As a basis for determining the fair value of certain of the Company&#146;s financial instruments, the Company utilizes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px; padding-left: 48px">Level I &#150; Observable inputs such as quoted prices in active markets for identical assets or liabilities.</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px; padding-left: 48px">Level II &#150; Observable inputs, other than Level I prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px; padding-left: 48px">Level III &#150; Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the entire fair value measurement requires management to make judgments and consider factors specific to the asset or liability. The Company's cash equivalents are classified within Level&#160;I of the fair value hierarchy. </p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px; text-align: justify">The following table provides a rollforward of the Company&#146;s Level 3 fair value measurements:</p> <p style="margin: 0px; text-align: justify"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 6.73px"></td><td style="width: 6.73px"></td><td style="width: 67.2px"></td><td style="width: 6.73px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: top"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.73px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 73.93px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Contingent Consideration</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.73px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top"><p style="margin: 0px; text-align: justify">Balance at December 31, 2017</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 67.2px"><p style="margin: 0px; text-align: right">2,609,289</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: top"><p style="margin: 0px; text-align: justify">Change in fair value</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 67.2px"><p style="margin: 0px; text-align: right">551,098</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top"><p style="margin: 0px; text-align: justify">Balance at June 30, 2018</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 67.2px"><p style="margin: 0px; text-align: right">3,160,387</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td></tr> </table> <p style="margin: 0px; text-align: justify"><br /></p> <p style="margin: 0px">The change in the fair value of the contingent consideration of $551,098 for the six months ended June 30, 2018 reflects an increase in the probability of reaching Pelican&#146;s dosing of the first patient in its first Phase 1 trial for an oncology indication based on the passage of time and impact of progress in antibody manufacturing. Adjustments associated with the change in fair value of contingent consideration are included in the Company&#146;s consolidated statement of operations and comprehensive loss.</p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">The following table presents quantitative information about the inputs and valuation methodologies used for the Company&#146;s fair value measurements of contingent consideration classified as Level 3 as of June 30, 2018:</p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" align="center" style="margin-top: 0px; font-size: 10pt"><tr style="height: 0px; font-size: 0"><td style="width: 160.26px"></td><td style="width: 10.46px"></td><td style="width: 160.2px"></td><td style="width: 10.46px"></td><td style="width: 160.2px"></td><td style="width: 10.46px"></td><td style="width: 159.93px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: top; width: 160.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 160.2px"><p style="margin: 0px; font-size: 8pt"><b>Valuation <br /> Methodology</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 160.2px"><p style="margin: 0px; font-size: 8pt"><b>Significant <br /> Unobservable Input</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 159.93px"><p style="margin: 0px; font-size: 8pt"><b>Weighted Average <br /> (range, if applicable)</b></p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: top; width: 160.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 160.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 160.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 159.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.26px"><p style="margin: 0px">Contingent Consideration</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.2px"><p style="margin: 0px">Probability weighted <br /> income approach</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.2px"><p style="margin: 0px">Milestone dates</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 159.93px"><p style="margin: 0px">2019-2026</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: top; width: 160.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 160.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 160.2px"><p style="margin: 0px">Discount rate</p> </td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 159.93px"><p style="margin: 0px">11.68% to 4.50%</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.2px"><p style="margin: 0px">Probability of occurrence</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 159.93px"><p style="margin: 0px">23% - 86%</p> </td></tr> </table> <p style="margin: 0px; text-align: justify"><b>4. Prepaid Expenses and Other Current Assets</b></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">Prepaid expenses and other current assets consist of the following at: </font></p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 14.53px"></td><td style="width: 11px"></td><td style="width: 72.06px"></td><td style="width: 14.53px"></td><td style="width: 12.8px"></td><td style="width: 70.26px"></td><td style="width: 7.13px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>December&#160;31,<br /> 2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="line-height: 11pt; margin: 0px">&#160;&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Prepaid manufacturing expense </p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 11px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; text-align: right">3,810,178</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 12.8px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; text-align: right">1,551,597</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Prepaid insurance</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; text-align: right">31,250</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; text-align: right">218,750</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Other prepaid expenses</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; text-align: right">146,387</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; text-align: right">87,937</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Other current assets</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; text-align: right">20,000</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; text-align: right">108,973</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 11px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; text-align: right">4,007,815</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 12.8px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; text-align: right">1,967,257</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="margin: 0px; text-align: justify"></p> <p style="margin: 0px; text-align: justify"><b>5. Property and Equipment</b></p> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">Property and equipment are recorded at cost and depreciated using the straight-line&#160;method over the estimated useful lives, ranging generally from five to seven years. Expenditures&#160;for maintenance and repairs are charged to expense as incurred.</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="margin: 0px">Property and equipment consisted of the following:</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 14.53px"></td><td style="width: 11px"></td><td style="width: 72.06px"></td><td style="width: 14.53px"></td><td style="width: 12.8px"></td><td style="width: 70.26px"></td><td style="width: 7.13px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>December&#160;31,<br /> 2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="line-height: 11pt; margin: 0px">&#160;&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Furniture and fixtures</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 11px"><p style="line-height: 11pt; margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">55,883</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 12.8px"><p style="line-height: 11pt; margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">55,883</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Computers</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">26,383</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">41,333</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Lab equipment</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">1,116,307</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">645,433</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Total</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">1,198,573</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">742,649</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Accumulated depreciation</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">(552,839</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 14.53px"><p style="line-height: 11pt; margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">(455,758</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 7.13px"><p style="line-height: 11pt; margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Property and equipment, net</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 11px"><p style="line-height: 11pt; margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">645,734</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 12.8px"><p style="line-height: 11pt; margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">286,891</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="margin: 0px">Depreciation expense was $108,408 and $66,671 for the six months ended June 30, 2018 and 2017, respectively. </p> <p style="margin: 0px; text-align: justify"><b>6. Goodwill and In-Process R&#38;D</b></p> <p style="margin: 0px; text-align: justify"><br /></p> <p style="margin: 0px; text-align: justify">Goodwill of $2.2 million and in-process R&#38;D of $5.9 million were recorded in connection with the acquisition of Pelican, as described in Note 2. The carrying value of goodwill and in-process R&#38;D has remained unchanged and no impairment was recognized as of June 30, 2018 and December 31, 2017. </p> <p style="margin: 0px"><font style="background-color: #FFFFFF"><b>7. Accrued Expenses and other payables</b></font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">Accrued expenses and other payables consist of the following: </font></p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 14.4px"></td><td style="width: 7.13px"></td><td style="width: 79.26px"></td><td style="width: 14.4px"></td><td style="width: 7.13px"></td><td style="width: 79.26px"></td><td style="width: 6.86px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; font-size: 8pt; text-align: center">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 86.4px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30, <br /> 2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 86.4px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>December&#160;31,<br /> 2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Accrued clinical trial and other expenses</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.4px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">1,226,998</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.4px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">1,504,240</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.86px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Compensation and related benefits</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">88,518</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">542,434</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.86px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Deferred rent</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">18,051</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">27,457</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Patent fees</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">30,000</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">40,000</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Other expenses </p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">82,300</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; font-family: Times,Times New Roman; text-align: right">162,300</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">1,445,867</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14.4px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">2,276,431</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6.86px"><p style="margin: 0px">&#160;</p> </td></tr> </table> <p style="margin: 0px"><b>8. Stock-Based Compensation</b></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF"><b><i>Stock Options</i></b></font></p> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="margin: 0px">The following is a summary of the stock option activity for the six months ended June 30, 2018:</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 8.06px"></td><td style="width: 8.06px"></td><td style="width: 74.33px"></td><td style="width: 8.2px"></td><td style="width: 8.2px"></td><td style="width: 8.86px"></td><td style="width: 74.33px"></td><td style="width: 7.93px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 82.4px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Shares</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 83.2px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Weighted </b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Average </b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Exercise </b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Price</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Outstanding, December&#160;31, 2017</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">266,884</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.86px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">19.57</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Granted</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">173,336</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">3.97</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Forfeited</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">(15,628</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.2px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 8.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">32.80</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Outstanding, June 30, 2018</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">424,592</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 8.86px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">12.72</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="margin: 0px"><br /></p> <p style="margin: 0px">The weighted average grant-date fair value of stock options granted during the six months ended June 30, 2018 was $2.84. The fair value of each stock option was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions for stock options granted during the six months ended June 30, 2018:</p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 6.46px"></td><td style="width: 6.46px"></td><td style="width: 71.33px"></td><td style="width: 14.53px"></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Dividend yield</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 71.33px"><p style="margin: 0px; text-align: right">0.0</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px">%</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Expected volatility</p> </td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 71.33px"><p style="margin: 0px; text-align: right">83.96</p> </td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 14.53px"><p style="margin: 0px">%</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Risk-free interest rate</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 71.33px"><p style="margin: 0px; text-align: right">2.34</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px">%</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Expected lives (years)</p> </td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 71.33px"><p style="margin: 0px; text-align: right">6.3</p> </td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The risk-free interest rate is based on U.S. Treasury interest rates at the time of the grant whose term is consistent with the expected life of the stock options. The Company used an average historical stock price volatility based on an analysis of reported data for a peer group of comparable companies that have issued stock options with substantially similar terms, as the Company did not have sufficient trading history for its common stock. Expected term represents the period that the Company&#146;s stock option grants are expected to be outstanding. The Company elected to utilize the &#147;simplified&#148; method to estimate the expected term. Under this approach, the weighted-average expected life is presumed to be the average of the vesting term and the contractual term of the option.</p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">Expected dividend yield was considered to be 0% in the option pricing formula since the Company had not paid any dividends and had no plans to do so in the future. The forfeiture rate was considered to be none as the options vest on a monthly basis. </p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">The Company recognized $108,340 and $123,418 in stock-based option compensation expense for the three months ended June 30, 2018 and 2017, respectively and $242,147 and $245,142 in stock-based option compensation expense for the six months ended June 30, 2018 and 2017, respectively. The following table summarizes information about stock options outstanding at June 30, 2018:</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" align="center" style="margin-top: 0px; font-size: 10pt"><tr style="height: 0px; font-size: 0"><td style="width: 101.93px"></td><td style="width: 5.33px"></td><td style="width: 5.33px"></td><td style="width: 102.13px"></td><td style="width: 5.4px"></td><td style="width: 5.4px"></td><td style="width: 102.26px"></td><td style="width: 5.4px"></td><td style="width: 5.4px"></td><td style="width: 102.13px"></td><td style="width: 5.4px"></td><td style="width: 5.4px"></td><td style="width: 102.13px"></td><td style="width: 5.4px"></td><td style="width: 5.4px"></td><td style="width: 102.26px"></td><td style="width: 5.26px"></td></tr> <tr><td colspan="7" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 327.8px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Options Outstanding</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="7" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 328.13px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Options Vested and Exercisable</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.26px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 101.93px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>6/30/2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.33px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.33px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Weighted</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Average</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Remaining</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Contractual</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Life</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>(Years)</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.26px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Weighted</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Average</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Exercise</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Price</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Balance</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>as of</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>6/30/2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Weighted</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Average</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Remaining</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Contractual</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Life</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>(Years)</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.26px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Weighted</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Average</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Exercise</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Price</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.26px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 101.93px"><p style="margin: 0px; text-align: center">424,592</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; text-align: center">8.5</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.26px"><p style="margin: 0px; text-align: center">$12.72</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; text-align: center">161,461</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; text-align: center">7.4</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.26px"><p style="margin: 0px; text-align: center">$24.06</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">As of June 30, 2018, the unrecognized stock-based compensation expense related to unvested stock options was $1,522,789, which is expected to be recognized over a weighted average period of approximately 17.31 months.</font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Restricted Stock</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The Company recognized </font><font style="background-color: #FFFFFF">$31,097 and $19,686 </font><font style="background-color: #FFFFFF">in stock-based compensation expense for employees related to restricted stock awards during the three months ended June 30, 2018 and 2017, respectively, and $265,228 and $136,207</font><font style="background-color: #FFFFFF"> </font><font style="background-color: #FFFFFF">in stock-based compensation expense for employees related to restricted stock awards during the six months ended June 30, 2018 and 2017, respectively. </font><font style="background-color: #FFFFFF">The Company recognized $802 and $</font><font style="background-color: #FFFFFF">10,500 </font><font style="background-color: #FFFFFF">in share-based compen</font><font style="background-color: #FFFFFF">sation expense related to issuance of shares of restricted stock to non-employees (i.e., consultants) in exchange for services during the three months ended June 30, 2018 and 2017, respectively and </font><font style="background-color: #FFFFFF">$4,757 and $</font><font style="background-color: #FFFFFF">21,000 </font><font style="background-color: #FFFFFF">in share-based compen</font><font style="background-color: #FFFFFF">sation expense related to issuance of shares of restricted stock to non-employees (i.e., consultants) in exchange for services during the six months ended June 30, 2018 and 2017, respectively. As of June 30, 2018, there were 62,207 restricted stock awards granted to employees and non-employees, all of which were unvested. </font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">Total stock-based compensation expense, including restricted stock and stock options was $512,120 and $402,349 for the six months ended June 30, 2018 and 2017, respectively. </p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b>9. Financing</b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF"><b><i>Public Offering</i></b></font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">On May 7, 2018, the Company closed an underwritten public offering (the &#147;Offering&#148;) in which it issued and sold (i) 4,875,000 shares of common stock together with a number of common warrants to purchase 2,437,500 shares of its common stock, and (ii) 9,500,000 pre-funded warrants, with each pre-funded warrant exercisable for one share of common stock, together with a number of common warrants to purchase 4,750,000 shares of its common stock. The public offering price was $1.44 per share of common stock, $1.43 per pre-funded warrant and $0.01 per common warrant. The net proceeds to the Company were approximately $18.8 million, net of underwriting discounts and commissions and other estimated offering expenses. The common stock warrants expire five years after date of issuance and have an exercise price of $1.584 per share. As of June 30, 2018, 3,054,667 common stock warrants have been exercised for an additional $4.8 million of proceeds to the Company and all pre-funded warrants have been exercised. In connection with the offering the Company entered into an underwriting agreement (the &#147;Underwriting Agreement&#148;), dated May 2, 2018 with A.G.P./Alliance Global Partners (A.G.P.), as representative of the underwriters. The Underwriting Agreement contains customary representations, warranties, and agreements by the Company, customary conditions to closing, indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act of 1933, as amended (the &#147;Securities Act&#148;), other obligations of the parties and termination provisions. </p> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><b><i>At the Market Offering</i></b></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">On January 18, 2018, the Company entered into a Common Stock Sales Agreement with H.C. Wainwright &#38; Co., LLC, (&#147;HCW&#148;) as sales agent, pursuant to which the Company may sell from time to time, at its option, shares of its common stock, par value $0.0002 per share for the sale of up to $3,658,000 of shares of the Company&#146;s common stock and on March 15, 2018 issued a prospectus supplement for an additional aggregate offering price of up to $1,300,000. Sales of shares of common stock have been made pursuant to the Company&#146;s shelf registration statement on Form S-3 (File No.&#160;333-221201) filed with the U.S. Securities and Exchange Commission (&#147;SEC&#148;), dated November 13, 2017. As of June 30, 2018 the Company sold an aggregate of 1,403,367 shares of common stock under the HCW Sales Agreement resulting in net proceeds of approximately $3.4 million. </p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><b><i>Common Stock Warrants</i></b></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px">In connection with the May 7, 2018 public offering, the Company issued 9,500,000 pre-funded warrants and 7,187,500 common stock warrants each of which are exercisable for one share of common stock. The pre-funded warrants had an exercise price of $0.01 per share and as of June 30, 2018 all pre-funded warrants have been exercised. The common stock warrants have an exercise price of $1.584 per share and expire five years from the issuance date. As of June 30, 2018, 3,054,667 common stock warrants have been exercised. The warrants have been accounted for as equity instruments. The fair value of the common stock warrants of approximately $7.8 million at the date of issuance was estimated using the Black-Scholes Merton model which used the following inputs: term of 5 years, risk free rate of 2.78%, 0% dividend yield, volatility of 124.14%, and share price of $1.30 per share based on the trading price of the Company&#146;s common stock. </p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">In connection with the March 23, 2017 public offering the Company issued warrants to purchase 682,500 shares of common stock with an exercise price of $10.00 per share that expire five years from the issuance date. In connection with the Company&#146;s July 23, 2013 initial public offering, the Company issued warrants to the underwriters for 12,500 shares of common stock issuable at $125.00 per share upon exercise that expire five years from the issuance date. On March 10, 2011, the Company issued warrants to purchase shares of common stock to third parties in consideration for a private equity placement transaction of which 1,738 warrants remain outstanding. The warrants have an exercise price of $4.80 per share and expire ten years from the issuance date. </p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">During the six months ended June 30, 2018, 3,054,667 common stock warrants have been exercised and no warrants were exercised during the same period in 2017. The Company has outstanding warrants to purchase 4,132,833 shares of common stock issuable at $1.584 per share, 296,159 shares of common stock issuable at $10.00 per share; warrants to purchase 12,500 shares of common stock issuable at $125.00 per share; and warrants to purchase 1,738 shares of common stock issuable at $4.80 per share. These warrants do not meet the criteria required to be classified as liability awards and therefore are treated as equity awards. </p> <p style="line-height: 10pt; margin: 0px"><b>10.&#160;Grant and Licensing Revenues</b></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">In June 2016, Pelican entered into a Cancer Research Grant Contract (&#147;Grant Contract&#148;) with CPRIT,<font style="font-family: Arial"> </font>under which CPRIT awarded a grant not to exceed $15.2 million for use in developing cancer treatments by targeting a novel T-cell costimulatory receptor (namely, TNFRSF25). The Grant Contract covers a three-year period from June 1, 2016 through May 31, 2019.</p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">Upon commercialization of the product, the terms of&#160;the Grant Contract require Pelican to pay tiered<font style="font-family: Arial"> </font>royalties in the low to mid-single digit percentages. Such royalties reduce to less than one percent after a mid-single-digit multiple of the grant funds have been paid to CPRIT in royalties.</p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">The Company recognized grant revenue of approximately $1.1 million and $1.9 million during the three and six months ended June 30, 2018 for qualified expenditures under the grant. The Company recognized grant revenue during the three months ended June 30, 2017 of approximately $0.4 million and for the six months ended June 30, 2017 revenue included an additional $0.02 million of research funding revenue for research and development services, provided to Shattuck Labs, Inc. which research funding agreement terminated January 31, 2017. </p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">As of June 30, 2018, the Company had deferred revenue of $5.1 million for proceeds received from the CPRIT grant, but for which the costs had not been incurred or the conditions of the award had not been met.</p> <p style="margin: 0px"><b>11. Net Loss Per Share</b></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">Basic and diluted net loss per common share is calculated by dividing net loss applicable to Heat Biologics, Inc. by the weighted-average number of common shares outstanding during the period, without consideration for common stock equivalents. The Company&#146;s potentially dilutive shares, which include outstanding stock options and warrants, are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. The following table reconciles net loss to net loss attributable to Heat Biologics, Inc.:</p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 6.8px"></td><td style="width: 6.8px"></td><td style="width: 73.73px"></td><td style="width: 14.06px"></td><td style="width: 7.06px"></td><td style="width: 73.86px"></td><td style="width: 7.06px"></td><td style="width: 7.13px"></td><td style="width: 7.13px"></td><td style="width: 73.8px"></td><td style="width: 7.13px"></td><td style="width: 7.13px"></td><td style="width: 7.13px"></td><td style="width: 74.33px"></td><td style="width: 6.66px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="5" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 175.53px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Three Months Ended</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="6" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 176.66px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Six Months Ended</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 80.53px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.06px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 80.93px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 80.93px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 81.46px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2017</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Net loss</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; text-align: right">(4,246,805</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; text-align: right">(3,309,081</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; text-align: right">(7,980,032</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">(6,549,809</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss: Non-controlling interest</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; text-align: right">(196,734</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; text-align: right">(90,166</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; text-align: right">(403,195</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">(140,956</p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss attributable to Heat Biologics, Inc.</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; text-align: right">(4,050,071</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; text-align: right">(3,218,915</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; text-align: right">(7,576,837</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">(6,408,853</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px">&#160;&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Weighted-average number of common shares used in net loss per share attributable to Heat Biologics, Inc.&#151;basic and diluted</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; text-align: right">14,727,682</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; text-align: right">3,524,483</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; text-align: right">9,894,367</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">3,112,412</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss per share attributable to Heat Biologics, Inc.&#151;basic and diluted</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; text-align: right">(0.27</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; text-align: right">(0.91</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; text-align: right">(0.77</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">(2.06</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> </table> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">The following potentially dilutive securities were excluded from the calculation of diluted net loss per share due to their anti-dilutive effect:</font></p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 13.33px"></td><td style="width: 6.86px"></td><td style="width: 79.66px"></td><td style="width: 13.33px"></td><td style="width: 7px"></td><td style="width: 79.53px"></td><td style="width: 6.6px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="5" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 186.4px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>For the Six months Ended</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30, </b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.6px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 86.53px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 86.53px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.6px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Outstanding stock options</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.66px"><p style="margin: 0px; text-align: right">424,592</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.53px"><p style="margin: 0px; text-align: right">252,000</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.6px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Outstanding restricted stock units</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.66px"><p style="margin: 0px; text-align: right">62,207</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.53px"><p style="margin: 0px; text-align: right">30,623</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.6px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Outstanding common stock warrants</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.66px"><p style="margin: 0px; text-align: right">4,443,230</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.53px"><p style="margin: 0px; text-align: right">310,397</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.6px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b>12. Income Tax</b></font></p> <p style="line-height: 8pt; margin: 0px"><font style="background-color: #FFFFFF">&#160;</font></p> <p style="margin: 0px">Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases, operating loss carryforwards, and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. As of June 30, 2018, a full valuation allowance has been provided against certain deferred tax assets as it is currently deemed more likely than not that the benefit of such net tax assets will not be utilized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.</p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">In accordance with FASB ASC 740,&#160;Accounting for Income Taxes, the Company reflects in the accompanying unaudited condensed consolidated financial statements the benefit of positions taken in a previously filed tax return or expected to be taken in a future tax return only when it is considered &#145;more-likely-than-not&#146; that the position taken will be sustained by a taxing authority. As of June 30, 2018, and December&#160;31, 2017, the Company had no unrecognized income tax benefits and correspondingly there is no impact on the Company&#146;s effective income tax rate associated with these items. The Company&#146;s policy for recording interest and penalties relating to uncertain income tax positions is to record them as a component of income tax expense in the accompanying statements of operations and comprehensive loss. As of June 30, 2018, and December&#160;31, 2017, the Company had no such accruals.</font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">On December 22, 2017, the Tax Cuts and Jobs Act (the &#147;Act&#148;) was enacted into law. The Tax Act lowered the Federal corporate tax rate from 34% to 21% for periods beginning on or after January 1, 2018 and made numerous other tax law changes. The Company has measured deferred tax assets at the enacted tax rate expected to apply when these temporary differences are expected to be realized or settled. The Company is required to recognize the effect of tax law changes in the period of enactment. Additional federal and state interpretive guidance is still forthcoming that could potentially affect the measurement of these balances or give rise to new deferred tax amounts. As such, the remeasurement of our deferred tax balance is provisional pending future guidance. The Company reasonably anticipates that any such guidance will be available prior to December 31, 2018.</p> <p style="margin: 0px"></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b>13. Subsequent Events</b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px">On July 20, 2018, the Company&#146;s Board of Directors, approved an amendment (the &#147;Amendment&#148;) to the Amended and Restated Bylaws of the Company. The Amendment, which was adopted effective as of July 20, 2018, provides that at each meeting of stockholders the presence in person or by proxy of the holders of shares of stock having one-third (1/3) of the shares of stock entitled to vote at the meeting is necessary to constitute a quorum.</p> <p style="margin: 0px">&#160;</p> <p style="margin: 0px"></p> <p style="margin: 0px">On July 20, 2018, the previously scheduled 2018 Annual Meeting of Stockholders of the Company was adjourned due to the absence of a quorum due, in part, to lack of votes by shares held in certain European brokerage accounts. &#160;On August 13, 2018, the Board of Directors of the Company approved October 2, 2018 as the new date of the 2018 Annual Meeting of Stockholders.</p> <p style="margin: 0px"><font style="background-color: #FFFFFF"><b><i>Basis of Presentation and Principles of Consolidation</i></b></font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">On January 19, 2018, the Company announced a reverse stock split of its shares of common stock at a ratio of one-for-ten. The reverse stock split took effect at 11 p.m. ET on January 19, 2018, and the Company&#146;s common stock began to trade on a post-split basis at the market open on January 22, 2018. During the Company&#146;s annual stockholders meeting held June 29, 2017, stockholders approved the Company&#146;s reverse stock split and granted the board of directors the authority to implement and determine the exact split ratio within a specified range. When the reverse stock split became effective, every 10 shares of our issued and outstanding common stock were combined into one share of common stock. Effecting the reverse stock split reduced the number of issued and outstanding common stock from approximately 42 million shares to approximately 4.2 million. It also subsequently adjusted outstanding options issued under the Company&#146;s equity incentive plan and outstanding warrants to purchase common stock. </p> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">The accompanying unaudited consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the United States of America (&#147;U.S. GAAP&#148;) for interim financial reporting. However, certain information or footnote disclosures normally included in complete financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the &#147;SEC&#148;). In the opinion of the Company&#146;s management, the unaudited consolidated financial statements in this Quarterly Report on Form 10-Q include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending December&#160;31, 2018. </font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">The consolidated financial statements as of and for the six months ended June 30, 2018 and 2017 included in this Quarterly Report on Form 10-Q are unaudited. The balance sheet as of December 31, 2017 is derived from the audited consolidated financial statements as of that date. The accompanying unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes, together with Management&#146;s Discussion and Analysis of Financial Condition and Results of Operations, contained in the Company&#146;s Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on March 2, 2018 (the &#147;2017 Annual Report&#148;). </font></p> <p style="margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">On April 28, 2017, the Company completed the acquisition of an 80% controlling interest in Pelican Therapeutics, Inc. (&#147;Pelican&#148;), a related party prior to acquisition. Operations of Pelican are included in the consolidated statements of operations and comprehensive loss from the acquisition date. </font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">The accompanying consolidated financial statements as of and for the six months ended June 30, 2018 and 2017 include the accounts of Heat Biologics, Inc. (&#147;the Company&#148;), and its subsidiaries, Heat Biologics I, Inc. (&#147;Heat I&#148;), Heat Biologics III, Inc. (&#147;Heat III&#148;), Heat Biologics IV, Inc. (&#147;Heat IV&#148;), Heat Biologics GmbH, Heat Biologics Australia Pty Ltd. and Zolovax. Additionally, as of the six months ended June 30, 2018 the accompanying consolidated financials include Pelican. The functional currency of the entities located outside the United States is the applicable local currency (the foreign entities). Assets and liabilities of the foreign entities are translated at period-end exchange rates. &#160;Statement of operations accounts are translated at the average exchange rate during the period. The effects of foreign currency translation adjustments are included in other comprehensive loss, which is a component of accumulated other comprehensive loss in stockholders&#146; equity. All significant intercompany accounts and transactions have been eliminated in consolidation. At December 31, 2017 and June 30, 2018, the Company held a 92.5% controlling interest in Heat I and an 80% controlling interest in Pelican. All other subsidiaries are wholly owned. For the six months ended June 30, 2018 the Company recognized $161,994 in net loss non-controlling interest for Heat I and $241,201 in net loss non-controlling interest for Pelican. The Company accounts for its less than 100% interest in these subsidiaries in the consolidated financial statements in accordance with U.S. GAAP. Accordingly, the Company presents non-controlling interests as a component of stockholders&#146; equity on its consolidated balance sheets and reports non-controlling interest net loss under the heading &#147;net loss &#150; non-controlling interest&#148; in the consolidated statements of operations and comprehensive loss. </font></p> <p style="margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The Company has an accumulated deficit of approximately $76.4 million as of June 30, 2018 and a net loss of approximately $8.0 million for the six months ended June 30, 2018 and has not generated significant revenue or positive cash flows from operations. In May 2018, through a public offering, the Company raised approximately $18.8 million, net of underwriting discounts and commissions and other estimated offering expenses, and an additional $4.8 million through the exercise of 3,054,667 warrants.<a name="Hlk497836823"></a> On April 28, 2017, the acquisition of an 80% controlling interest in Pelican, a related party prior to acquisition, was completed. Pelican has been awarded a $15.2 million grant to fund preclinical and some clinical activities from the Cancer Prevention and Research Institute of Texas (&#147;CPRIT&#148;). The CPRIT grant is subject to customary CPRIT funding conditions. The Company believes the acquisition aligns its strategic focus and strengthens its position in the T-cell activation arena. </p> <p style="line-height: 11pt; margin: 0px"></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Cash Equivalents and Restricted Cash</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The Company considers all highly liquid instruments with an original maturity of six months or less to be cash equivalents. Restricted cash consists of deposits held by the US Patent and Trademark Office.</font></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Use of Estimates</i></b></font></p> <p style="line-height: 11pt; margin: 0px; text-align: justify"><br /></p> <p style="line-height: 11pt; margin: 0px">The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that&#160;affect the amounts reported in the financial statements and accompanying notes. Estimates are&#160;used for, but not limited to, useful lives of fixed assets, income taxes and stock-based compensation. Actual results may differ from those estimates.</p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Segments</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The Company has one reportable segment - the development of immunotherapies designed to activate and expand a patient's T-cell mediated immune system against cancer.</font></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Business Combinations</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The Company accounts for acquisitions using the acquisition method of accounting, which requires that all identifiable assets acquired and liabilities assumed be recorded at their estimated fair values. The excess of the fair value of purchase consideration over the fair values of identifiable assets and liabilities is recorded as goodwill. When determining the fair values of assets acquired and liabilities assumed, management makes significant estimates and assumptions.</p> <p style="line-height: 11pt; margin: 0px">&#160;</p> <p style="line-height: 11pt; margin: 0px">Critical estimates in valuing certain intangible assets include but are not limited to future expected cash flows from acquired patented technology. Management&#146;s estimates of fair value are based upon assumptions believed to be reasonable, but are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. Other estimates associated with the accounting for acquisitions may change as additional information becomes available regarding the assets acquired and liabilities assumed (see Note 2).</p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Goodwill&#160;and In-Process Research and Development</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The Company classifies intangible assets into three categories: (1)&#160;intangible assets with definite lives subject to amortization, (2)&#160;intangible assets with indefinite lives not subject to amortization and (3)&#160;goodwill. The Company determines the useful lives of definite-lived intangible assets after considering specific facts and circumstances related to each intangible asset. Factors the Company considers when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, and other economic facts; including competition and specific market conditions. Intangible assets that are deemed to have definite lives are amortized, primarily on a straight-line basis, over their estimated useful lives.</p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">Intangible assets that are deemed to have indefinite lives, including goodwill, are reviewed for impairment annually on the anniversary of the acquisition, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test for indefinite-lived intangibles, other than goodwill, consists of a comparison of the fair value of the intangible asset with its carrying amount. If the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess. Indefinite-lived intangible assets, such as goodwill, are not amortized. The Company will qualitatively test the carrying amounts of goodwill for recoverability on an annual basis or when events or changes in circumstances indicate evidence a potential impairment exists, using a fair value-based test. No impairment existed at June 30, 2018.</p> <p style="margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">In-process research and development, or IPR&#38;D, assets are considered to be indefinite-lived until the completion or abandonment of the associated research and development projects. IPR&#38;D assets represent the fair value assigned to technologies that the Company acquires, which at the time of acquisition have not reached technological feasibility and have no alternative future use. During the period that the assets are considered indefinite-lived, they are tested for impairment on an annual basis, or more frequently if the Company becomes aware of any events occurring or changes in circumstances that indicate that the fair value of the IPR&#38;D assets are less than their carrying amounts. If and when development is complete, which generally occurs upon regulatory approval and the ability to commercialize products associated with the IPR&#38;D assets, these assets are then deemed definite-lived and are amortized based on their estimated useful lives at that point in time. If development is terminated or abandoned, the Company may have a full or partial impairment charge related to the IPR&#38;D assets, calculated as the excess of carrying value of the IPR&#38;D assets over fair value. No impairment existed at June 30, 2018.</p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Contingent Consideration</i></b></font></p> <p style="line-height: 11pt; margin: 0px; text-indent: 24px; text-align: justify">&#160;</p> <p style="line-height: 11pt; margin: 0px">Consideration paid in a business combination may include potential future payments that are contingent upon the acquired business achieving certain milestones in the future (&#147;contingent consideration&#148;). Contingent consideration liabilities are measured at their estimated fair value as of the date of acquisition, with subsequent changes in fair value recorded in the consolidated statements of operations. The Company estimates the fair value of the contingent consideration as of the acquisition date using the estimated future cash outflows based on the <a name="Hlk490152250"></a>probability of meeting future milestones. The milestone payments will be made upon the achievement of clinical and commercialization milestones as well as single low digit royalty payments and payments upon receipt of sublicensing income. Subsequent to the date of acquisition, <font style="font-family: Times,Times New Roman">the Company <a name="Hlk511038718"></a>will reassess </font>the actual consideration earned and the probability-weighted future earn-out payments at each balance sheet date. Any adjustment to the contingent consideration liability will be recorded in the consolidated statements of operations. Contingent consideration liabilities are presented in long-term liabilities in the consolidated balance sheets (see Note 2). </p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Revenue Recognition</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">Effective January 1, 2018, the Company has adopted on a modified retrospective basis Accounting Standards Codification (ASC) Topic 606. </font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The Company&#146;s sole source of revenue is grant revenue related to the CPRIT Contract, which is being accounted for under ASC 606. ASC 606 introduces a new framework for analyzing potential revenue transactions by identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations in the contract, and recognizing revenue when (or as) the Company satisfies a performance obligation.</font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The performance obligations of the CPRIT Contract include developing a human TNFRSF25 agonist antibody for use in cancer patients through research and development efforts and a noncommercial license from CPRIT-funded research to CPRIT and other government agencies and institutions of higher education in Texas. </font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">Management has concluded that the license and R&#38;D services should be combined into a single performance obligation as both are highly interdependent - a license cannot be effectively granted without the corresponding research basis and CPRIT cannot benefit from the license without the R&#38;D services and are therefore not capable of being distinct. </font></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px">The CPRIT grant covers a three-year period from June 1, 2017 through May 31, 2019, for a total grant award of up to $15.2 million. CPRIT advances grant funds upon request by the Company consistent with the agreed upon amounts and schedules as provided in the contract. The first tranche of funding of $1.8 million was received in May 2017, and a second tranche of funding of $6.5 million was received in October 2017. The next tranche of funding is expected to be requested and received in late 2018. Funds received are reflected in deferred revenue as a liability until revenue is earned. &#160;Grant revenue is recognized when qualifying costs are incurred. </p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Deferred Revenue</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px">As of June 30, 2018, deferred revenue is comprised of proceeds of $4.9 million received from CPRIT for which the costs have not been incurred or the conditions of the award have not been met and $0.2 million of grant funds received from an economic development grant agreement with the City of San Antonio (&#147;Economic Development Grant&#148;), for the purpose of defraying costs toward the purchase of laboratory equipment. As of June 30, 2018, the deferred revenue balance was $5.1 million with $3.4 million recognized as revenue from CPRIT since the CPRIT contract inception. </p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Prepaid Expenses and Other Current Assets</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">The Company&#146;s prepaid expenses and other current assets consists primarily of the amount paid in advance for cGMP production of Pelican&#146;s PTX-35 antibody and PTX-15 fusion protein, as well as Chemistry Manufacturing and Control (&#147;CMC&#148;) material for the Company&#146;s clinical trial studies for HS-110. </font></p> <p style="line-height: 11pt; margin: 0px"></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Income Taxes</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF">The Company accounts for income taxes using the asset and liability method, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent that utilization is not presently more likely than not.</font></p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Significant Accounting Policies</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">The significant accounting policies used in preparation of these interim financial statements are disclosed in the Company's Form 10-K and have not changed significantly since such filing.</p> <p style="line-height: 11pt; margin: 0px"><font style="background-color: #FFFFFF"><b><i>Recently Issued Accounting Pronouncements</i></b></font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">In June 2018, the FASB issued ASU 2018-07: <i>Compensation &#150; Stock Compensation (Topic 718)</i>: Improvements to Nonemployee Share-Based Payment Accounting. This ASU expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees, and as a result, the accounting for share-based payments to non-employees will be substantially aligned. ASU 2018-07 is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year, early adoption is permitted but no earlier than an entity&#146;s adoption date of Topic 606. <font style="background-color: #FFFFFF">The Company has not determined the impact of this standard and does not plan early adoption of this standard.</font></p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">In January 2017, the FASB issued ASU No.&#160;2017-01,&#160;<i>Business Combinations (Topic 805)&#160;</i>to clarify the definition of a business, which is fundamental in the determination of whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses combinations. The updated guidance requires that in order to be considered a business the integrated set of assets and activities acquired must include, at a minimum, an input and process that contribute to the ability to create output. If substantially all of the fair value of the assets acquired is concentrated in a single identifiable asset or group of similar assets, it is not considered a business, and therefore would not be considered a business combination. The update is effective for fiscal years beginning after December 15, 2018, and interim periods with fiscal years beginning after December 15, 2019, with early adoption permitted. <font style="background-color: #FFFFFF">The Company has not determined the impact of this standard and does not plan early adoption of this standard.</font></p> <p style="margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">In August 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230)&#151;Restricted Cash. ASU 2016-18 requires the statement of cash flows to be a reconciliation between beginning and ending cash balances inclusive of restricted cash balances. ASU 2016-18 is effective for fiscal years beginning after December 15, 2017 and is to be applied using a retrospective transition method to each period presented. The Company adopted this ASU for the year ending December 31, 2018. The adoption of this standard resulted in the removal of changes in Restricted Cash from the Consolidated Statements of Cash Flows of $1,122 and $98,879 for the six months ended June 30, 2018 and 2017, respectively and inclusion of these amounts as part of the starting and ending cash balances.</p> <p style="line-height: 11pt; margin: 0px"><br /></p> <p style="line-height: 11pt; margin: 0px">In February 2016, the FASB issued ASU 2016-02,&#160;<i>Leases (Topic 842)</i>, requiring lessees to recognize for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee&#146;s obligation to make lease payments arising from a lease, measured on a discounted basis, and (2) a right-of-use (&#147;ROU&#148;) asset, which is an asset that represents the lessee&#146;s right to use, or control the use of, a specified asset for the lease term. The update is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2020. The Company currently anticipates that upon adoption of the new standard, ROU assets and lease liabilities will be recognized in amounts that will be immaterial to the consolidated balance sheets.</p> <p style="margin: 0px"></p> <p style="line-height: 11pt; margin: 0px">The purchase price has been allocated to the assets and liabilities as follows:&#160;</p> <p style="line-height: 11pt; margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 7.93px"></td><td style="width: 8.06px"></td><td style="width: 75.53px"></td><td style="width: 4.46px"></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify"><b>Aggregate consideration:</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td colspan="2" style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 83.6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Cash consideration</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">500,000</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Stock consideration</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">1,052,000</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Contingent consideration </p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">2,385,000</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify"><b>Total Consideration</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px"><b>$</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right"><b>3,937,000</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; text-align: justify"><b>Purchase price allocation:</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Cash acquired</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">31,199</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; text-align: justify">In-process R&#38;D</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">5,866,000</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Goodwill</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">2,189,338</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Deferred tax liability</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">(2,111,760</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Net liabilities assumed</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">(1,102,777</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; text-align: justify">Fair value of non-controlling interest</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right">(935,000</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; text-align: justify"><b>Total purchase price</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px"><b>$</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75.53px"><p style="margin: 0px; text-align: right"><b>3,937,000</b></p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 4.46px"><p style="margin: 0px">&#160;</p> </td></tr> </table> <p style="margin: 0px"><br /></p> <a name="Hlk520111448"></a><table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 6.66px"></td><td style="width: 6.66px"></td><td style="width: 74px"></td><td style="width: 14px"></td><td style="width: 6.66px"></td><td style="width: 75px"></td><td style="width: 6px"></td><td style="width: 6px"></td><td style="width: 6.66px"></td><td style="width: 74px"></td><td style="width: 7px"></td><td style="width: 7px"></td><td style="width: 7px"></td><td style="width: 75px"></td><td style="width: 6.66px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="5" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 176.33px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Three Months Ended</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td style="margin-top: 0px; vertical-align: top; width: 6px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="6" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 176.66px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Six Months Ended</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 80.66px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 81.66px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td style="margin-top: 0px; vertical-align: top; width: 6px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 80.66px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 7px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td style="margin-top: 0px; vertical-align: top; width: 7px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 82px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2017</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px; font-size: 8pt">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Revenue</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74px"><p style="margin: 0px; font-family: Times,Times New Roman; text-align: right">1,143,177</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75px"><p style="margin: 0px; font-family: Times,Times New Roman; text-align: right">411,250</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">1,895,704</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75px"><p style="margin: 0px; font-family: Times,Times New Roman; text-align: right">435,490</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6.66px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(4,246,805</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(3,310,791</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(7,980,032</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(6,940,735</p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss: Non-controlling interest</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(196,734</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(90,508</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(403,195</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(219,142</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss attributable to Heat Biologics, Inc.</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(4,050,071</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(3,220,283</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(7,576,837</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 7px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(6,721,593</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 75px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6.66px"><p style="margin: 0px">&#160;&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss per share attributable to Heat Biologics, Inc.&#151;basic and diluted</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(0.27</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(0.88</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 6px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 74px"><p style="margin: 0px; text-align: right">(0.77</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 7px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 75px"><p style="margin: 0px; text-align: right">(2.07</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> </table> <p style="margin: 0px; text-align: justify">The following table provides a rollforward of the Company&#146;s Level 3 fair value measurements:</p> <p style="margin: 0px; text-align: justify"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 6.73px"></td><td style="width: 6.73px"></td><td style="width: 67.2px"></td><td style="width: 6.73px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: top"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.73px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 73.93px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Contingent Consideration</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.73px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top"><p style="margin: 0px; text-align: justify">Balance at December 31, 2017</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 67.2px"><p style="margin: 0px; text-align: right">2,609,289</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: top"><p style="margin: 0px; text-align: justify">Change in fair value</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 67.2px"><p style="margin: 0px; text-align: right">551,098</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top"><p style="margin: 0px; text-align: justify">Balance at June 30, 2018</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 67.2px"><p style="margin: 0px; text-align: right">3,160,387</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6.73px"><p style="margin: 0px">&#160;</p> </td></tr> </table> <p style="margin: 0px"></p> <p style="margin: 0px">The following table presents quantitative information about the inputs and valuation methodologies used for the Company&#146;s fair value measurements of contingent consideration classified as Level 3 as of June 30, 2018:</p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" align="center" style="margin-top: 0px; font-size: 10pt"><tr style="height: 0px; font-size: 0"><td style="width: 160.26px"></td><td style="width: 10.46px"></td><td style="width: 160.2px"></td><td style="width: 10.46px"></td><td style="width: 160.2px"></td><td style="width: 10.46px"></td><td style="width: 159.93px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: top; width: 160.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 160.2px"><p style="margin: 0px; font-size: 8pt"><b>Valuation <br /> Methodology</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 160.2px"><p style="margin: 0px; font-size: 8pt"><b>Significant <br /> Unobservable Input</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 159.93px"><p style="margin: 0px; font-size: 8pt"><b>Weighted Average <br /> (range, if applicable)</b></p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: top; width: 160.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 160.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 160.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 159.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.26px"><p style="margin: 0px">Contingent Consideration</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.2px"><p style="margin: 0px">Probability weighted <br /> income approach</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.2px"><p style="margin: 0px">Milestone dates</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 159.93px"><p style="margin: 0px">2019-2026</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: top; width: 160.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 160.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 160.2px"><p style="margin: 0px">Discount rate</p> </td><td style="margin-top: 0px; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 159.93px"><p style="margin: 0px">11.68% to 4.50%</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 160.2px"><p style="margin: 0px">Probability of occurrence</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 10.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 159.93px"><p style="margin: 0px">23% - 86%</p> </td></tr> </table> <p style="margin: 0px; text-align: justify"><b></b></p> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">Prepaid expenses and other current assets consist of the following at: </font></p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 14.53px"></td><td style="width: 11px"></td><td style="width: 72.06px"></td><td style="width: 14.53px"></td><td style="width: 12.8px"></td><td style="width: 70.26px"></td><td style="width: 7.13px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>December&#160;31,<br /> 2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="line-height: 11pt; margin: 0px">&#160;&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Prepaid manufacturing expense </p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 11px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; text-align: right">3,810,178</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 12.8px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; text-align: right">1,551,597</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Prepaid insurance</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; text-align: right">31,250</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; text-align: right">218,750</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Other prepaid expenses</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; text-align: right">146,387</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; text-align: right">87,937</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Other current assets</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; text-align: right">20,000</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; text-align: right">108,973</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 11px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; text-align: right">4,007,815</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 12.8px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; text-align: right">1,967,257</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="line-height: 8pt; margin: 0px"></p> <p style="margin: 0px">Property and equipment consisted of the following:</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 14.53px"></td><td style="width: 11px"></td><td style="width: 72.06px"></td><td style="width: 14.53px"></td><td style="width: 12.8px"></td><td style="width: 70.26px"></td><td style="width: 7.13px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>December&#160;31,<br /> 2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; vertical-align: bottom; width: 83.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="line-height: 11pt; margin: 0px">&#160;&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Furniture and fixtures</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 11px"><p style="line-height: 11pt; margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">55,883</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 12.8px"><p style="line-height: 11pt; margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">55,883</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Computers</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">26,383</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">41,333</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Lab equipment</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">1,116,307</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">645,433</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Total</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">1,198,573</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">742,649</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Accumulated depreciation</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">(552,839</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 14.53px"><p style="line-height: 11pt; margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">(455,758</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 7.13px"><p style="line-height: 11pt; margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 11px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 72.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 12.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 70.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="line-height: 11pt; margin: 0px">Property and equipment, net</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 11px"><p style="line-height: 11pt; margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 72.06px"><p style="line-height: 11pt; margin: 0px; text-align: right">645,734</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 12.8px"><p style="line-height: 11pt; margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 70.26px"><p style="line-height: 11pt; margin: 0px; text-align: right">286,891</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="margin: 0px"><br /></p> <p style="margin: 0px"><font style="background-color: #FFFFFF">Accrued expenses and other payables consist of the following: </font></p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 14.4px"></td><td style="width: 7.13px"></td><td style="width: 79.26px"></td><td style="width: 14.4px"></td><td style="width: 7.13px"></td><td style="width: 79.26px"></td><td style="width: 6.86px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; font-size: 8pt; text-align: center">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 86.4px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30, <br /> 2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 86.4px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>December&#160;31,<br /> 2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Accrued clinical trial and other expenses</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.4px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">1,226,998</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.4px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">1,504,240</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.86px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Compensation and related benefits</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">88,518</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">542,434</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.86px"><p style="margin: 0px">&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Deferred rent</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">18,051</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">27,457</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Patent fees</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">30,000</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">40,000</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Other expenses </p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">82,300</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; font-family: Times,Times New Roman; text-align: right">162,300</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #FFFFFF 1px solid; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">1,445,867</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14.4px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 79.26px"><p style="margin: 0px; text-align: right">2,276,431</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6.86px"><p style="margin: 0px">&#160;</p> </td></tr> </table> <p style="margin: 0px"><font style="background-color: #FFFFFF"><b><i></i></b></font></p> <p style="line-height: 8pt; margin: 0px"><br /></p> <p style="margin: 0px">The following is a summary of the stock option activity for the six months ended June 30, 2018:</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 8.06px"></td><td style="width: 8.06px"></td><td style="width: 74.33px"></td><td style="width: 8.2px"></td><td style="width: 8.2px"></td><td style="width: 8.86px"></td><td style="width: 74.33px"></td><td style="width: 7.93px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 82.4px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Shares</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 83.2px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Weighted </b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Average </b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Exercise </b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Price</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Outstanding, December&#160;31, 2017</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">266,884</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.86px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">19.57</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Granted</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">173,336</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">3.97</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Forfeited</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">(15,628</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.2px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 8.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">32.80</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Outstanding, June 30, 2018</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 8.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">424,592</p> </td><td style="margin-top: 0px; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 8.2px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 8.86px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">12.72</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.93px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="margin: 0px">The fair value of each stock option was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions for stock options granted during the six months ended June 30, 2018:</p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 6.46px"></td><td style="width: 6.46px"></td><td style="width: 71.33px"></td><td style="width: 14.53px"></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Dividend yield</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 71.33px"><p style="margin: 0px; text-align: right">0.0</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px">%</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Expected volatility</p> </td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 71.33px"><p style="margin: 0px; text-align: right">83.96</p> </td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 14.53px"><p style="margin: 0px">%</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Risk-free interest rate</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 71.33px"><p style="margin: 0px; text-align: right">2.34</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.53px"><p style="margin: 0px">%</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Expected lives (years)</p> </td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 6.46px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 71.33px"><p style="margin: 0px; text-align: right">6.3</p> </td><td style="margin-top: 0px; background-color: #FFFFFF; vertical-align: bottom; width: 14.53px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="margin: 0px">The following table summarizes information about stock options outstanding at June 30, 2018:</p> <p style="line-height: 8pt; margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" align="center" style="margin-top: 0px; font-size: 10pt"><tr style="height: 0px; font-size: 0"><td style="width: 101.93px"></td><td style="width: 5.33px"></td><td style="width: 5.33px"></td><td style="width: 102.13px"></td><td style="width: 5.4px"></td><td style="width: 5.4px"></td><td style="width: 102.26px"></td><td style="width: 5.4px"></td><td style="width: 5.4px"></td><td style="width: 102.13px"></td><td style="width: 5.4px"></td><td style="width: 5.4px"></td><td style="width: 102.13px"></td><td style="width: 5.4px"></td><td style="width: 5.4px"></td><td style="width: 102.26px"></td><td style="width: 5.26px"></td></tr> <tr><td colspan="7" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 327.8px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Options Outstanding</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="7" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 328.13px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Options Vested and Exercisable</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.26px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 101.93px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>6/30/2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.33px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.33px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Weighted</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Average</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Remaining</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Contractual</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Life</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>(Years)</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.26px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Weighted</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Average</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Exercise</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Price</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Balance</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>as of</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>6/30/2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Weighted</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Average</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Remaining</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Contractual</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Life</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>(Years)</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.26px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Weighted</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Average</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Exercise</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>Price</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 5.26px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 101.93px"><p style="margin: 0px; text-align: center">424,592</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; text-align: center">8.5</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.26px"><p style="margin: 0px; text-align: center">$12.72</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; text-align: center">161,461</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.13px"><p style="margin: 0px; text-align: center">7.4</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.4px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 1px solid; vertical-align: bottom; width: 102.26px"><p style="margin: 0px; text-align: center">$24.06</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 5.26px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> <p style="margin: 0px">The following table reconciles net loss to net loss attributable to Heat Biologics, Inc.:</p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 6.8px"></td><td style="width: 6.8px"></td><td style="width: 73.73px"></td><td style="width: 14.06px"></td><td style="width: 7.06px"></td><td style="width: 73.86px"></td><td style="width: 7.06px"></td><td style="width: 7.13px"></td><td style="width: 7.13px"></td><td style="width: 73.8px"></td><td style="width: 7.13px"></td><td style="width: 7.13px"></td><td style="width: 7.13px"></td><td style="width: 74.33px"></td><td style="width: 6.66px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="5" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 175.53px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Three Months Ended</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="6" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 176.66px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>Six Months Ended</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30,</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 80.53px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.06px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 80.93px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 80.93px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: top; width: 81.46px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2017</b></p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Net loss</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; text-align: right">(4,246,805</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; text-align: right">(3,309,081</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; text-align: right">(7,980,032</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">(6,549,809</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss: Non-controlling interest</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; text-align: right">(196,734</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 14.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; text-align: right">(90,166</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; text-align: right">(403,195</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">(140,956</p> </td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss attributable to Heat Biologics, Inc.</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; text-align: right">(4,050,071</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #000000 1px solid; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; text-align: right">(3,218,915</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; text-align: right">(7,576,837</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-bottom: #000000 3px double; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">(6,408,853</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; border-top: #FFFFFF 1px solid; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;&#160;</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 14.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: top; width: 6.66px"><p style="margin: 0px">&#160;&#160;</p> </td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Weighted-average number of common shares used in net loss per share attributable to Heat Biologics, Inc.&#151;basic and diluted</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; text-align: right">14,727,682</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 14.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; text-align: right">3,524,483</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.06px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; text-align: right">9,894,367</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">3,112,412</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.66px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding-left: 8px; text-indent: -8px">Net loss per share attributable to Heat Biologics, Inc.&#151;basic and diluted</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">&#160;</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 6.8px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.73px"><p style="margin: 0px; text-align: right">(0.27</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 14.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.86px"><p style="margin: 0px; text-align: right">(0.91</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.06px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 73.8px"><p style="margin: 0px; text-align: right">(0.77</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px">)</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: top; width: 7.13px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 7.13px"><p style="margin: 0px; text-align: right">$</p> </td><td style="margin-top: 0px; border-bottom: #000000 3px double; vertical-align: bottom; width: 74.33px"><p style="margin: 0px; text-align: right">(2.06</p> </td><td style="margin-top: 0px; border-bottom: #FFFFFF 3px double; vertical-align: bottom; width: 6.66px"><p style="margin: 0px">)</p> </td></tr> </table> <p style="margin: 0px"><font style="background-color: #FFFFFF">The following potentially dilutive securities were excluded from the calculation of diluted net loss per share due to their anti-dilutive effect:</font></p> <p style="margin: 0px"><br /></p> <table cellpadding="0" cellspacing="0" style="margin-top: 0px; font-size: 10pt; width: 100%"><tr style="height: 0px; font-size: 0"><td></td><td style="width: 13.33px"></td><td style="width: 6.86px"></td><td style="width: 79.66px"></td><td style="width: 13.33px"></td><td style="width: 7px"></td><td style="width: 79.53px"></td><td style="width: 6.6px"></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td colspan="5" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 186.4px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>For the Six months Ended</b></p> <p style="margin: 0px; font-size: 8pt; text-align: center"><b>June 30, </b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.6px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 86.53px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2018</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td><td colspan="2" style="margin-top: 0px; border-bottom: #000000 1px solid; vertical-align: bottom; width: 86.53px"><p style="margin: 0px; font-size: 8pt; text-align: center"><b>2017</b></p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.6px"><p style="margin: 0px; padding: 0px; font-size: 8pt">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Outstanding stock options</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.66px"><p style="margin: 0px; text-align: right">424,592</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.53px"><p style="margin: 0px; text-align: right">252,000</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.6px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; vertical-align: bottom"><p style="margin: 0px">Outstanding restricted stock units</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.66px"><p style="margin: 0px; text-align: right">62,207</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 7px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; vertical-align: bottom; width: 79.53px"><p style="margin: 0px; text-align: right">30,623</p> </td><td style="margin-top: 0px; vertical-align: bottom; width: 6.6px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> <tr><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom"><p style="margin: 0px">Outstanding common stock warrants</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.86px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.66px"><p style="margin: 0px; text-align: right">4,443,230</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 13.33px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 7px"><p style="margin: 0px; padding: 0px">&#160;</p></td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 79.53px"><p style="margin: 0px; text-align: right">310,397</p> </td><td style="margin-top: 0px; background-color: #CCFFCC; vertical-align: bottom; width: 6.6px"><p style="margin: 0px; padding: 0px">&#160;</p></td></tr> </table> Probability weighted income approach 2019 - 2026 .0450 .1168 .23 0.86 EX-101.SCH 7 htbx-20180630.xsd XBRL SCHEMA FILE 00000001 - Document - Document and Entity Information link:presentationLink link:calculationLink link:definitionLink 00000002 - Statement - Consolidated Balance Sheets link:presentationLink link:calculationLink link:definitionLink 00000003 - Statement - Consolidated Balance Sheets (Parenthetical) link:presentationLink link:calculationLink link:definitionLink 00000004 - Statement - Consolidated Statements of Operations and Comprehensive Loss (Unaudited) link:presentationLink link:calculationLink link:definitionLink 00000005 - Statement - Consolidated Statements of Stockholders' Equity (Unaudited) link:presentationLink link:calculationLink link:definitionLink 00000006 - Statement - Consolidated Statements of Stockholders' Equity (Unaudited) (Parenthetical) link:presentationLink link:calculationLink link:definitionLink 00000007 - Statement - Consolidated Statements of Cash Flows (Unaudited) link:presentationLink link:calculationLink link:definitionLink 00000008 - Disclosure - Basis of Presentation and Significant Accounting Policies link:presentationLink link:calculationLink link:definitionLink 00000009 - Disclosure - Acquisition of Pelican Therapeutics link:presentationLink link:calculationLink link:definitionLink 00000010 - Disclosure - Fair Value of Financial Instruments link:presentationLink link:calculationLink link:definitionLink 00000011 - Disclosure - Prepaid Expenses and Other Current Assets link:presentationLink link:calculationLink link:definitionLink 00000012 - Disclosure - Property and Equipment link:presentationLink link:calculationLink link:definitionLink 00000013 - Disclosure - Goodwill and In-process R&D link:presentationLink link:calculationLink link:definitionLink 00000014 - Disclosure - Accrued Expenses and other payables link:presentationLink link:calculationLink link:definitionLink 00000015 - Disclosure - Stock-Based Compensation link:presentationLink link:calculationLink link:definitionLink 00000016 - Disclosure - Financing link:presentationLink link:calculationLink link:definitionLink 00000017 - Disclosure - Grant and Licensing Revenues link:presentationLink link:calculationLink link:definitionLink 00000018 - Disclosure - Net Loss Per Share link:presentationLink link:calculationLink link:definitionLink 00000019 - Disclosure - Income Tax link:presentationLink link:calculationLink link:definitionLink 00000020 - Disclosure - Subsequent Events link:presentationLink link:calculationLink link:definitionLink 00000021 - Disclosure - Basis of Presentation and Significant Accounting Policies (Policies) link:presentationLink link:calculationLink link:definitionLink 00000022 - Disclosure - Acquisition of Pelican Therapeutics (Tables) link:presentationLink link:calculationLink link:definitionLink 00000023 - Disclosure - Fair Value of Financial Instruments (Tables) link:presentationLink link:calculationLink link:definitionLink 00000024 - Disclosure - Prepaid Expenses and Other Current Assets (Tables) link:presentationLink link:calculationLink link:definitionLink 00000025 - Disclosure - Property and Equipment (Tables) link:presentationLink link:calculationLink link:definitionLink 00000026 - Disclosure - Goodwill and In-process R&D (Tables) link:presentationLink link:calculationLink link:definitionLink 00000027 - Disclosure - Accrued Expenses and other payables (Tables) link:presentationLink link:calculationLink link:definitionLink 00000028 - Disclosure - Stock-Based Compensation (Tables) link:presentationLink link:calculationLink link:definitionLink 00000029 - Disclosure - Net Loss Per Share (Tables) link:presentationLink link:calculationLink link:definitionLink 00000030 - Disclosure - Basis of Presentation and Significant Accounting Policies (Details) link:presentationLink link:calculationLink link:definitionLink 00000031 - Disclosure - Acquisition of Pelican Therapeutics (Narrative) (Details) link:presentationLink link:calculationLink link:definitionLink 00000032 - Disclosure - Acquisition of Pelican Therapeutics (Future Milestone Payments) (Details) link:presentationLink link:calculationLink link:definitionLink 00000033 - Disclosure - Acquisition of Pelican Therapeutics (Schedule of Purchase Price of Assets and Liabilities) (Details) link:presentationLink link:calculationLink link:definitionLink 00000034 - Disclosure - Acquisition of Pelican Therapeutics (Schedule of Pro Forma Financial Information for Acquisition) (Details) link:presentationLink link:calculationLink link:definitionLink 00000035 - Disclosure - Fair Value of Financial Instruments (Schedule of Fair Value Measurements) (Details) link:presentationLink link:calculationLink link:definitionLink 00000036 - Disclosure - Fair Value of Financial Instruments (Schedule of Inputs and Valuation Methodologies Used) (Details) link:presentationLink link:calculationLink link:definitionLink 00000037 - Disclosure - Prepaid Expenses and Other Current Assets (Schedule of Prepaid Expenses and Other Current Assets) (Details) link:presentationLink link:calculationLink link:definitionLink 00000038 - Disclosure - Property and Equipment (Details) link:presentationLink link:calculationLink link:definitionLink 00000039 - Disclosure - Accrued Expenses and other payables (Schedule of Accrued Expenses) (Details) link:presentationLink link:calculationLink link:definitionLink 00000040 - Disclosure - Stock-Based Compensation (Narrative) (Details) link:presentationLink link:calculationLink link:definitionLink 00000041 - Disclosure - Stock-Based Compensation (Schedule of Stock Option Activity) (Details) link:presentationLink link:calculationLink link:definitionLink 00000042 - Disclosure - Stock-Based Compensation (Schedule of Stock Option Valuation Assumptions) (Details) link:presentationLink link:calculationLink link:definitionLink 00000043 - Disclosure - Stock-Based Compensation (Summary of Outstandng Stock Options) (Details) link:presentationLink link:calculationLink link:definitionLink 00000044 - Disclosure - Financing (Details) link:presentationLink link:calculationLink link:definitionLink 00000045 - Disclosure - Grant and Licensing Revenues (Details) link:presentationLink link:calculationLink link:definitionLink 00000046 - Disclosure - Net Loss Per Share (Schedule of Reconciliation of Net Loss to Net Loss Attributable to Heat Biologics, Inc.) (Details) link:presentationLink link:calculationLink link:definitionLink 00000047 - Disclosure - Net Loss Per Share (Schedule of Antidilutive Securities) (Details) link:presentationLink link:calculationLink link:definitionLink 00000048 - Disclosure - Income Tax (Narrative) (Details) link:presentationLink link:calculationLink link:definitionLink EX-101.CAL 8 htbx-20180630_cal.xml XBRL CALCULATION FILE EX-101.DEF 9 htbx-20180630_def.xml XBRL DEFINITION FILE EX-101.LAB 10 htbx-20180630_lab.xml XBRL LABEL FILE Class of Warrant or Right [Axis] Warrants to purchase shares of common stock issuable at $125.00 per share [Member] Counterparty Name [Axis] Employees [Member] Award Type [Axis] Restricted Stock [Member] Stock options [Member] Non Employees [Member] Warrant [Member] Legal Entity [Axis] Heat Biologics I, Inc. [Member] Business Acquisition [Axis] Pelican Therapeutics, Inc. [Member] Range [Axis] Minimum [Member] Maximum [Member] Property, Plant and Equipment, Type [Axis] Furniture and fixtures [Member] Computers [Member] Lab equipment [Member] Antidilutive Securities [Axis] Common stock warrants [Member] Equity Components [Axis] Common Stock [Member] APIC [Member] Accumulated Deficit [Member] Accumulated Other Comprehensive Loss [Member] Non-Controlling Interest [Member] Class of Financing Receivable, Type [Axis] First tranche [Member] Product and Service [Axis] Grant Revenue [Member] Second tranche [Member] Title of Individual [Axis] Stockholders [Member] Warrants to purchase common stock at $10.00 per share [Member] Sale of Stock [Axis] Sales Agreement [Member] Pre funded warrants [Member] Finite-Lived Intangible Assets by Major Class [Axis] In-process R&D [Member] Document And Entity Information Entity Registrant Name Entity Central Index Key Document Type Document Period End Date Amendment Flag Current Fiscal Year End Date Entity a Well-known Seasoned Issuer Entity a Voluntary Filer Entity's Reporting Status Current Entity Filer Category Entity Public Float Entity Common Stock, Shares Outstanding Trading Symbol Document Fiscal Period Focus Document Fiscal Year Focus Statement of Financial Position [Abstract] Assets Current Assets Cash and cash equivalents Accounts receivable Prepaid expenses and other current assets Total Current Assets Property and Equipment, net Other Assets Restricted cash In-process R&D Goodwill Deposits Deferred financing costs Total Other Assets Total Assets Liabilities and Stockholders' Equity Current Liabilities Accounts payable Deferred revenue Accrued expenses and other liabilities Total Current Liabilities Long Term Liabilities Other long term liabilities Deferred tax liability Contingent consideration Total Liabilities Commitments and Contingencies Stockholders' Equity Common stock, $.0002 par value; 100,000,000 shares authorized, 23,093,584 and 4,200,310 shares issued and outstanding at June 30, 2018 (unaudited) and December 31, 2017, respectively Additional paid-in capital Accumulated deficit Accumulated other comprehensive loss Total Stockholders' Equity-Heat Biologics, Inc. Non-Controlling Interest Total Stockholders' Equity Total Liabilities and Stockholders' Equity Common stock, par value per share Common stock, shares authorized Common stock, shares issued Common stock, shares outstanding Statement of Comprehensive Income [Abstract] Revenue: Grant and licensing revenue Operating expenses: Research and development General and administrative Change in fair value of contingent consideration Total operating expenses Loss from operations Interest income Other (expense) income, net Total non-operating income (expenses), net Net loss Net loss - non-controlling interest Net loss attributable to Heat Biologics, Inc. Net loss per share attributable to Heat Biologics, Inc.-basic and diluted Weighted-average number of common shares used in net loss per share attributable to common stockholders-basic and diluted Other comprehensive loss: Net loss Unrealized gain /(loss) on foreign currency translation Total other comprehensive loss Comprehensive loss attributable to non-controlling interest Comprehensive loss Statement [Table] Statement [Line Items] Balance Public offering, 14,375,000 shares, net of underwriters discount Exercise of warrants, 3,054,667 shares Issuance of common stock, 1,403,367 shares Issuance of common stock for acquisition of Pelican, 1,331,056 shares Acquisition of non-controlling interest of Pelican Stock issuance costs Stock-based compensation Other comprehensive gain Balance Statement of Stockholders' Equity [Abstract] Issuance of common stock, shares Public offering, shares Exercise of warrants, shares Statement of Cash Flows [Abstract] Cash Flows from Operating Activities Adjustments to reconcile net loss to net cash used in operating activities: Depreciation Stock-based compensation Increase (decrease) in cash arising from changes in assets and liabilities: Accounts receivable Prepaid expenses and other current assets Restricted cash Accounts payable Deferred revenue Accrued expenses and other liabilities Deferred financing costs Other long term liabilities Deposits Net Cash Used in Operating Activities Cash Flows from Investing Activities Purchase of Pelican, net of cash acquired Purchase of property and equipment Net Cash Used in Investing Activities Cash Flows from Financing Activities Proceeds from public offering, net of underwriting discounts Proceeds from the issuance of common stock, net of commissions Proceeds from exercise of warrants Stock issuance costs Net Cash Provided by Financing Activities Effect of exchange rate changes on cash, cash equivalents and restricted cash Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash Cash, Cash Equivalents and Restricted Cash - Beginning of Period Cash, Cash Equivalents and Restricted Cash - End of Period Supplemental Disclosure for Cash Flow Information Contingent consideration Issuance of common stock for purchase of Pelican Accounting Policies [Abstract] Basis of Presentation and Significant Accounting Policies Business Combinations [Abstract] Acquisition of Pelican Therapeutics Fair Value Disclosures [Abstract] Fair Value of Financial Instruments Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] Prepaid Expenses and Other Current Assets Property, Plant and Equipment [Abstract] Property and Equipment Goodwill and Intangible Assets Disclosure [Abstract] Goodwill and In-process R&D Accrued Liabilities, Current [Abstract] Accrued Expenses and other payables Stock-based Compensation [Abstract] Stock-Based Compensation Stockholders' Equity Note [Abstract] Financing Revenue Recognition and Deferred Revenue [Abstract] Grant and Licensing Revenues Earnings Per Share [Abstract] Net Loss Per Share Income Tax Disclosure [Abstract] Income Tax Subsequent Events [Abstract] Subsequent Events Going Concern Basis of Presentation and Principles of Consolidation Cash Equivalents and Restricted Cash Use of Estimates Segments Business Combinations Goodwill and In-Process Research and Development Contingent Consideration Revenue Recognition Deferred Revenue Prepaid Expenses and Other Current Assets Income Taxes Significant Accounting Policies Stock Based Compensation Recently Issued Accounting Pronouncements Schedule of Assets Acquired and Liabilities Assumed in Acquisition Schedule of Pro Forma Financial Information for Acquisition Schedule of Level 3 Fair Value Measurements Schedule of Inputs and Valuation Methodologies Used for Fair Value of Contingent Consideration Schedule of Prepaid Expenses and Other Current Assets Schedule of Property and Equipment Schedule of Goodwill and In-process R&D Schedule of Accrued Expenses and other payables Stock-based Compensation Tables Schedule of Stock Option Activity Schedule of Stock Option Valuation Assumptions Schedule of Options Outstanding, Vested and Exercisable Schedule of Net Loss Per Share Schedule of Potentially Dilutive Securities Noncontrolling Interest [Table] Noncontrolling Interest [Line Items] Ownership interest in subsidiary Accumulated deficit Net loss Percentage of voting interests acquired in acquisition Revenue Non-controlling interest Percetage of obligation Contract value Reimbursable funds Unearned revenue liability balance Removal of changes in restricted cash from Consolidated Statements of Cash Flows due to adoption of ASU 2016-18 Reverse stock split Proceeds from financings Number of warrant exercised Proceeds from deferred revenue Grant received for preclinical activities from CPRIT Deferred revenue balance from CPRIT Schedule of Business Acquisitions, by Acquisition [Table] Business Acquisition [Line Items] Issuance of common stock Pelican, shares Percentage of outstanding common shares issued for equity consideration in business acquisition Cash consideration Accrued liabilities Fair value of contingent consideration In-process R&D Percentage of non-controlling interest acquired Net loss (income) Future milestone payment upon Pelican's dosing of the first patient in its first Phase 1 trial for an oncology indication Future milestone payment upon Pelican's dosing of the first patient in its first Phase 2 trial for an oncology indication Future milestone payment upon successful outcome of the first Phase 2 trial for an oncology indication Future milestone payment upon Pelican's dosing of the first patient in its first Phase 3 trial for an oncology indication Future milestone payment upon Pelican's dosing of the first patient in its first Phase 3 trial for a non- oncology indication Future milestone payment upon successful outcome of the first Phase 3 trial for an oncology indication Future milestone payment upon successful outcome of the first Phase 3 trial for a non-oncology indication Future milestone payment upon acceptance of a Biologics License Application (BLA) submission for an oncology indication Future milestone payment upon acceptance of a BLA submission for a non-oncology indication Future milestone payment upon first product indication approval in the United States or Europe for an oncology indication Future milestone payment upon first product indication approval in the United States or Europe for a non- oncology indication Discount rate used for calculation of fair value of contingent consideration Aggregate consideration: Stock consideration Total Consideration Purchase price allocation: Cash acquired In-process R&D Deferred tax liability Net liabilities assumed Fair value of non-controlling interest Total purchase price Revenue Net loss Net loss: Non-controlling interest Net loss attributable to Heat Biologics, Inc. Net loss per share attributable to Heat Biologics, Inc.-basic and diluted Balance at December 31, 2017 Change in fair value Balance at June 30, 2018 Valuation Methodology Significant unobservable input - milestone dates Discount rate - minimum Discount rate - maximum Probability of occurrence - minimum Probability of occurrence - maximum Prepaid manufacturing expense Prepaid insurance Other prepaid expenses Other current assets Prepaid expenses and other current assets Property, Plant and Equipment [Table] Property, Plant and Equipment [Line Items] Total Accumulated depreciation Property and equipment, net Depreciation expense Estimated useful lives Accrued clinical trial and other expenses Compensation and related benefits Deferred rent Patent fees Other expenses Accrued expenses Schedule of Share-based Compensation Arrangements by Share-based Payment Award [Table] Share-based Compensation Arrangement by Share-based Payment Award [Line Items] Subsequent Event Type [Axis] Warrants to purchase shares of common stock issuable at $4.80 per share [Member] Exercise price Stock based compensation Price per share Warrants, expiry period Proceeds from initial public offering Proceeds from initial public offering, net Common stock issued for conversion of warrants Expiration period Warrants outstanding Warrants, exercise price Risk free interest rate Dividend Volatility Expected Term Weighted average grant-date fair value of stock options granted Unrecognized stock-based compensation expense Unrecognized stock-based compensation expense, recognition period Restricted shares issued to a third party in exchange for services Warrants exercised Number of shares of common stock issuable through warrants Shares reserved for issuance to employees Stock awards granted Unvested stock awards Disclosure of Compensation Related Costs, Share-based Payments [Abstract] Shares Outstanding, December 31, 2017 Granted Exercised Expired/Cancelled Forfeited Outstanding, June 30, 2018 Weighted Average Exercise Price Outstanding, December 31, 2017 Granted Exercised Expired/Cancelled Forfeited Outstanding, June 30, 2018 Dividend yield Expected volatility Risk-free interest rate Expected lives (years) Options Outstanding Balance Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Options Exercisable Balance Weighted average remaining contractual life Weighted average exercise price Options Exercisable Options Vested and Exercisable Balance Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Schedule of Stock by Class [Table] Class of Stock [Line Items] Total value of common stock that can be sold through Common Stock Sales Agreement Shares issued under offering Proceeds from sale of common stock Sale of stock Offering price per share Public offering price Fair value of common stock Deferred Revenue Arrangement, by Type [Table] Deferred Revenue Arrangement [Line Items] Research funding revenue Net loss: Non-controlling interest Weighted-average number of common shares used in net loss per share attributable to Heat Biologics, Inc. - basic and diluted Net loss per share attributable to Heat Biologics, Inc. - basic and diluted Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table] Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] Potentially dilutive securities Unrecognized income tax benefits Income tax expense accrued Corporate tax rate Total of the carrying values as of the balance sheet date of obligations incurred through that date and payable for obligations related to accrued clinical trial expense. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer). Amount related to accrued patent fees. The pro forma basic and diluted net income per share for a period as if the business combination or combinations had been completed at the beginning of a period. The pro forma net income or loss attributable to noncontrolling interest for the period as if the business combination or combinations had been completed at the beginning of a period. The pro forma net profit loss for the period as if the business combination or combinations had been completed at the beginning of a period. Amount of change in fair value. Contingent consideration provided in business combination. Security that gives the holder the right to purchase shares of common stock in accordance with the terms of the instrument, usually upon payment of a specified amount. The accounting policy for contingent consideration. Discount rate used for calculation of fair value of contingent consideration. Employee [Member] Employees [Member] Future milestone payment upon acceptance of a Biologics License Application (BLA) submission for an oncology indication. Future milestone payment upon first product indication approval in the United States or Europe for a non- oncology indication. Future milestone payment upon Pelican's dosing of the first patient in its first Phase 3 trial for a non- oncology indication. Future milestone payment upon Pelican's dosing of the first patient in its first Phase 3 trial for an oncology indication. Future milestone payment upon acceptance of a BLA submission for a non-oncology indication. Future milestone payment upon Pelican's dosing of the first patient in its first Phase 1 trial for an oncology indication. Future milestone payment upon successful outcome of the first Phase 3 trial for a non-oncology indication. Future milestone payment upon successful outcome of the first Phase 3 trial for an oncology indication. Future milestone payment upon first product indication approval in the United States or Europe for an oncology indication Future milestone payment upon successful outcome of the first Phase 2 trial for an oncology indication. Future milestone payment upon Pelican's dosing of the first patient in its first Phase 2 trial for an oncology indication. The entire disclosure for grant and licensing revenues. Heat Biologics One [Member] Market issuance sales agreement [Member] Represents information pertaining to non-employees of the entity. Pelican Therapeutics, Inc. [Member] Percentage of outstanding common shares issued for equity consideration in business acquisition. The accounting policy for prepaid expenses and other current assets. The cash inflow associated with the amount received from entity's first offering of stock to the public before issuance costs and any discount adjustments. The cash inflow associated with the amount received from entity's first offering of stock to the public, net of payments for issuance costs. Research funding revenue for research and development services, which included labor and supplies. Sales Agreement [Member] Exercisable [Abstract] Outstanding [Abstract] Shattuck labs, inc [Member] Disclosure of accounting policy for significant accounting policies. Tranche Four Loan [Member] Tranche One Loan [Member] Tranche Three Loan [Member] Tranche Two Loan [Member] Underwriters Warrants [Member] Warrants, expiry period. Warrants to purchase shares of common stock issuable at price one. Warrants To Purchase Shares Of Common Stock Issuable At Price Three [Member] Warrants to purchase shares of common stock issuable at price two. Change in fair value of contingent consideration. Prepaid manufacturing expense. Percetage of obligation. Contract value. Reimbursable funds. First tranche [Member] Second tranche [Member] Total value of common stock that can be sold through Common Stock Sales Agreement. Removal of changes in restricted cash from Consolidated Statements of Cash Flows due to adoption of ASU 2016-18. Proceeds from deferred revenue. Deferred revenue balance. Pre funded warrants [Member] Underwriting Agreement [Member] Description of the inputs and valuation technique(s) used to measure fair value. Description of the milestone date inputs used to measure fair value. Minimum interest rate used to find the present value of an amount to be paid or received in the future as an input to measure fair value. For example, but not limited to, weighted average cost of capital (WACC), cost of capital, cost of equity and cost of debt. Maximum interest rate used to find the present value of an amount to be paid or received in the future as an input to measure fair value. For example, but not limited to, weighted average cost of capital (WACC), cost of capital, cost of equity and cost of debt. Probability of occurrence fair value input, minimum. Probability of occurrence fair value input, maximum. Assets, Current Other Assets, Noncurrent Assets [Default Label] Liabilities, Current Liabilities Stockholders' Equity Attributable to Parent Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest Liabilities and Equity Operating Expenses Operating Income (Loss) Nonoperating Income (Expense) Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest Comprehensive Income (Loss), Net of Tax, Attributable to Parent Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs Increase (Decrease) in Accounts Receivable Increase (Decrease) in Prepaid Expense and Other Assets Increase (Decrease) in Restricted Cash Increase (Decrease) in Accounts Payable Increase (Decrease) in Deferred Revenue Increase (Decrease) in Accrued Liabilities and Other Operating Liabilities Increase (Decrease) in Deferred Charges Increase (Decrease) in Other Noncurrent Liabilities Increase (Decrease) in Deposits Net Cash Provided by (Used in) Operating Activities Payments to Acquire Businesses, Net of Cash Acquired Payments to Acquire Property, Plant, and Equipment Net Cash Provided by (Used in) Investing Activities Payments of Stock Issuance Costs Net Cash Provided by (Used in) Financing Activities Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents Non Employees [Member] [Default Label] Fair Value Disclosures [Text Block] Accounts Payable, Accrued Liabilities, and Other Liabilities Disclosure, Current [Text Block] Compensation and Employee Benefit Plans [Text Block] PrepaidExpensesAndOtherCurrentAssetsPolicyTextBlock Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] Indefinite-lived Intangible Assets Acquired Business Combination, Consideration Transferred Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities Business Combination, Acquisition of Less than 100 Percent, Noncontrolling Interest, Fair Value Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest Heat Biologics I, Inc [Member] Stock-based Compensation Tables [Default Label] Business Acquisition, Pro Forma Net Income (Loss) Common Stock Warrant [Member] Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period Share-based Compensation Arrangement by Share-based Payment Award, Options, Expirations in Period Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Outstanding Options, Weighted Average Exercise Price Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Weighted Average Remaining Contractual Term Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Weighted Average Exercise Price EX-101.PRE 11 htbx-20180630_pre.xml XBRL PRESENTATION FILE XML 12 R1.htm IDEA: XBRL DOCUMENT v3.10.0.1
Document and Entity Information - shares
6 Months Ended
Jun. 30, 2018
Aug. 10, 2018
Document And Entity Information    
Entity Registrant Name HEAT BIOLOGICS, INC.  
Entity Central Index Key 0001476963  
Document Type 10-Q  
Document Period End Date Jun. 30, 2018  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Entity's Reporting Status Current Yes  
Entity Filer Category Smaller Reporting Company  
Entity Common Stock, Shares Outstanding   23,103,584
Trading Symbol HTBX  
Document Fiscal Period Focus Q2  
Document Fiscal Year Focus 2018  
XML 13 R2.htm IDEA: XBRL DOCUMENT v3.10.0.1
Consolidated Balance Sheets - USD ($)
Jun. 30, 2018
Dec. 31, 2017
Current Assets    
Cash and cash equivalents $ 24,660,733 $ 9,763,067
Accounts receivable 14,253 14,833
Prepaid expenses and other current assets 4,007,815 1,967,257
Total Current Assets 28,682,801 11,745,157
Property and Equipment, net 645,734 286,891
Other Assets    
Restricted cash 1,170 2,292
In-process R&D 5,866,000 5,866,000
Goodwill 2,189,338 2,189,338
Deposits 79,220 69,798
Deferred financing costs 30,000
Total Other Assets 8,135,728 8,157,428
Total Assets 37,464,263 20,189,476
Current Liabilities    
Accounts payable 821,822 1,033,680
Deferred revenue 5,130,684 7,026,388
Accrued expenses and other liabilities 1,445,867 2,276,431
Total Current Liabilities 7,398,373 10,336,499
Long Term Liabilities    
Other long term liabilities 156,141 160,559
Deferred tax liability 1,302,220 1,302,220
Contingent consideration 3,160,387 2,609,289
Total Liabilities 12,017,121 14,408,567
Commitments and Contingencies
Stockholders' Equity    
Common stock, $.0002 par value; 100,000,000 shares authorized, 23,093,584 and 4,200,310 shares issued and outstanding at June 30, 2018 (unaudited) and December 31, 2017, respectively 4,619 840
Additional paid-in capital 103,953,477 76,382,262
Accumulated deficit (76,423,163) (68,846,326)
Accumulated other comprehensive loss (94,754) (166,025)
Total Stockholders' Equity-Heat Biologics, Inc. 27,440,179 7,370,751
Non-Controlling Interest (1,993,037) (1,589,842)
Total Stockholders' Equity 25,447,142 5,780,909
Total Liabilities and Stockholders' Equity $ 37,464,263 $ 20,189,476
XML 14 R3.htm IDEA: XBRL DOCUMENT v3.10.0.1
Consolidated Balance Sheets (Parenthetical) - $ / shares
Jun. 30, 2018
Dec. 31, 2017
Statement of Financial Position [Abstract]    
Common stock, par value per share $ 0.0002 $ 0.0002
Common stock, shares authorized 100,000,000 100,000,000
Common stock, shares issued 23,093,584 4,200,310
Common stock, shares outstanding 23,093,584 4,200,310
XML 15 R4.htm IDEA: XBRL DOCUMENT v3.10.0.1
Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($)
3 Months Ended 6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Revenue:        
Grant and licensing revenue $ 1,143,177 $ 411,250 $ 1,895,704 $ 435,490
Operating expenses:        
Research and development 3,479,776 2,151,932 6,352,726 3,964,833
General and administrative 1,361,166 1,582,581 3,141,505 3,109,596
Change in fair value of contingent consideration 539,980 551,098
Total operating expenses 5,380,922 3,734,513 10,045,329 7,074,429
Loss from operations (4,237,745) (3,323,263) (8,149,625) (6,638,939)
Interest income 44,164 6,466 47,797 11,687
Other (expense) income, net (53,224) 7,716 121,796 77,443
Total non-operating income (expenses), net (9,060) 14,182 169,593 89,130
Net loss (4,246,805) (3,309,081) (7,980,032) (6,549,809)
Net loss - non-controlling interest (196,734) (90,166) (403,195) (140,956)
Net loss attributable to Heat Biologics, Inc. $ (4,050,071) $ (3,218,915) $ (7,576,837) $ (6,408,853)
Net loss per share attributable to Heat Biologics, Inc.-basic and diluted $ (0.27) $ (0.91) $ (0.77) $ (2.06)
Weighted-average number of common shares used in net loss per share attributable to common stockholders-basic and diluted 14,727,682 3,524,483 9,894,367 3,112,412
Other comprehensive loss:        
Net loss $ (4,246,805) $ (3,309,081) $ (7,980,032) $ (6,549,809)
Unrealized gain /(loss) on foreign currency translation 49,946 (9,660) 71,271 (76,035)
Total other comprehensive loss (4,196,859) (3,318,741) (7,908,761) (6,625,844)
Comprehensive loss attributable to non-controlling interest (196,734) (90,166) (403,195) (140,956)
Comprehensive loss $ (4,000,125) $ (3,228,575) $ (7,505,566) $ (6,484,888)
XML 16 R5.htm IDEA: XBRL DOCUMENT v3.10.0.1
Consolidated Statements of Stockholders' Equity (Unaudited) - 6 months ended Jun. 30, 2018 - USD ($)
Common Stock [Member]
APIC [Member]
Accumulated Deficit [Member]
Accumulated Other Comprehensive Loss [Member]
Non-Controlling Interest [Member]
Total
Balance at Dec. 31, 2017 $ 840 $ 76,382,262 $ (68,846,326) $ (166,025) $ (1,589,842) $ 5,780,909
Public offering, 14,375,000 shares, net of underwriters discount 2,875 20,697,122 20,699,997
Exercise of warrants, 3,054,667 shares 611 4,837,982 4,838,593
Issuance of common stock, 1,403,367 shares 281 3,573,099 3,573,380
Stock issuance costs (2,049,096) (2,049,096)
Stock-based compensation 12 512,108 512,120
Other comprehensive gain 71,271 71,271
Net loss (7,576,837) (403,195) (7,980,032)
Balance at Jun. 30, 2018 $ 4,619 $ 103,953,477 $ (76,423,163) $ (94,754) $ (1,993,037) $ 25,447,142
XML 17 R6.htm IDEA: XBRL DOCUMENT v3.10.0.1
Consolidated Statements of Stockholders' Equity (Unaudited) (Parenthetical) - shares
1 Months Ended 6 Months Ended
May 07, 2018
May 31, 2018
Jun. 30, 2018
Statement of Stockholders' Equity [Abstract]      
Issuance of common stock, shares     1,403,367
Public offering, shares 4,875,000   14,375,000
Exercise of warrants, shares   3,054,667 3,054,667
XML 18 R7.htm IDEA: XBRL DOCUMENT v3.10.0.1
Consolidated Statements of Cash Flows (Unaudited) - USD ($)
6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Cash Flows from Operating Activities    
Net loss $ (7,980,032) $ (6,549,809)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation 108,408 66,671
Stock-based compensation 512,120 402,349
Change in fair value of contingent consideration 551,098
Increase (decrease) in cash arising from changes in assets and liabilities:    
Accounts receivable 473 72,543
Prepaid expenses and other current assets (2,044,397) 68,591
Accounts payable (211,858) (202,244)
Deferred revenue (1,895,704) 1,409,212
Accrued expenses and other liabilities (830,162) (767,418)
Deferred financing costs 30,000
Other long term liabilities (4,418) (21,816)
Deposits (9,422)
Net Cash Used in Operating Activities (11,773,894) (5,521,921)
Cash Flows from Investing Activities    
Purchase of Pelican, net of cash acquired (468,801)
Purchase of property and equipment (467,251) (15,289)
Net Cash Used in Investing Activities (467,251) (484,090)
Cash Flows from Financing Activities    
Proceeds from public offering, net of underwriting discounts 20,699,997 4,183,000
Proceeds from the issuance of common stock, net of commissions 3,573,380 2,461,880
Proceeds from exercise of warrants 4,838,593
Stock issuance costs (2,049,096) (239,617)
Net Cash Provided by Financing Activities 27,062,874 6,405,263
Effect of exchange rate changes on cash, cash equivalents and restricted cash 74,815 4,971
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash 14,896,544 404,223
Cash, Cash Equivalents and Restricted Cash - Beginning of Period 9,765,359 7,943,838
Cash, Cash Equivalents and Restricted Cash - End of Period 24,661,903 8,348,061
Supplemental Disclosure for Cash Flow Information    
Issuance of common stock for purchase of Pelican $ 1,052,000
XML 19 R8.htm IDEA: XBRL DOCUMENT v3.10.0.1
Basis of Presentation and Significant Accounting Policies
6 Months Ended
Jun. 30, 2018
Accounting Policies [Abstract]  
Basis of Presentation and Significant Accounting Policies

1. Basis of Presentation and Significant Accounting Policies


Basis of Presentation and Principles of Consolidation


On January 19, 2018, the Company announced a reverse stock split of its shares of common stock at a ratio of one-for-ten. The reverse stock split took effect at 11 p.m. ET on January 19, 2018, and the Company’s common stock began to trade on a post-split basis at the market open on January 22, 2018. During the Company’s annual stockholders meeting held June 29, 2017, stockholders approved the Company’s reverse stock split and granted the board of directors the authority to implement and determine the exact split ratio within a specified range. When the reverse stock split became effective, every 10 shares of our issued and outstanding common stock were combined into one share of common stock. Effecting the reverse stock split reduced the number of issued and outstanding common stock from approximately 42 million shares to approximately 4.2 million. It also subsequently adjusted outstanding options issued under the Company’s equity incentive plan and outstanding warrants to purchase common stock.


The accompanying unaudited consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting. However, certain information or footnote disclosures normally included in complete financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company’s management, the unaudited consolidated financial statements in this Quarterly Report on Form 10-Q include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending December 31, 2018.


The consolidated financial statements as of and for the six months ended June 30, 2018 and 2017 included in this Quarterly Report on Form 10-Q are unaudited. The balance sheet as of December 31, 2017 is derived from the audited consolidated financial statements as of that date. The accompanying unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on March 2, 2018 (the “2017 Annual Report”).


On April 28, 2017, the Company completed the acquisition of an 80% controlling interest in Pelican Therapeutics, Inc. (“Pelican”), a related party prior to acquisition. Operations of Pelican are included in the consolidated statements of operations and comprehensive loss from the acquisition date.


The accompanying consolidated financial statements as of and for the six months ended June 30, 2018 and 2017 include the accounts of Heat Biologics, Inc. (“the Company”), and its subsidiaries, Heat Biologics I, Inc. (“Heat I”), Heat Biologics III, Inc. (“Heat III”), Heat Biologics IV, Inc. (“Heat IV”), Heat Biologics GmbH, Heat Biologics Australia Pty Ltd. and Zolovax. Additionally, as of the six months ended June 30, 2018 the accompanying consolidated financials include Pelican. The functional currency of the entities located outside the United States is the applicable local currency (the foreign entities). Assets and liabilities of the foreign entities are translated at period-end exchange rates.  Statement of operations accounts are translated at the average exchange rate during the period. The effects of foreign currency translation adjustments are included in other comprehensive loss, which is a component of accumulated other comprehensive loss in stockholders’ equity. All significant intercompany accounts and transactions have been eliminated in consolidation. At December 31, 2017 and June 30, 2018, the Company held a 92.5% controlling interest in Heat I and an 80% controlling interest in Pelican. All other subsidiaries are wholly owned. For the six months ended June 30, 2018 the Company recognized $161,994 in net loss non-controlling interest for Heat I and $241,201 in net loss non-controlling interest for Pelican. The Company accounts for its less than 100% interest in these subsidiaries in the consolidated financial statements in accordance with U.S. GAAP. Accordingly, the Company presents non-controlling interests as a component of stockholders’ equity on its consolidated balance sheets and reports non-controlling interest net loss under the heading “net loss – non-controlling interest” in the consolidated statements of operations and comprehensive loss.


The Company has an accumulated deficit of approximately $76.4 million as of June 30, 2018 and a net loss of approximately $8.0 million for the six months ended June 30, 2018 and has not generated significant revenue or positive cash flows from operations. In May 2018, through a public offering, the Company raised approximately $18.8 million, net of underwriting discounts and commissions and other estimated offering expenses, and an additional $4.8 million through the exercise of 3,054,667 warrants. On April 28, 2017, the acquisition of an 80% controlling interest in Pelican, a related party prior to acquisition, was completed. Pelican has been awarded a $15.2 million grant to fund preclinical and some clinical activities from the Cancer Prevention and Research Institute of Texas (“CPRIT”). The CPRIT grant is subject to customary CPRIT funding conditions. The Company believes the acquisition aligns its strategic focus and strengthens its position in the T-cell activation arena.


Cash Equivalents and Restricted Cash


The Company considers all highly liquid instruments with an original maturity of six months or less to be cash equivalents. Restricted cash consists of deposits held by the US Patent and Trademark Office.


Use of Estimates


The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Estimates are used for, but not limited to, useful lives of fixed assets, income taxes and stock-based compensation. Actual results may differ from those estimates.


Segments


The Company has one reportable segment - the development of immunotherapies designed to activate and expand a patient's T-cell mediated immune system against cancer.


Business Combinations


The Company accounts for acquisitions using the acquisition method of accounting, which requires that all identifiable assets acquired and liabilities assumed be recorded at their estimated fair values. The excess of the fair value of purchase consideration over the fair values of identifiable assets and liabilities is recorded as goodwill. When determining the fair values of assets acquired and liabilities assumed, management makes significant estimates and assumptions.

 

Critical estimates in valuing certain intangible assets include but are not limited to future expected cash flows from acquired patented technology. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. Other estimates associated with the accounting for acquisitions may change as additional information becomes available regarding the assets acquired and liabilities assumed (see Note 2).


Goodwill and In-Process Research and Development


The Company classifies intangible assets into three categories: (1) intangible assets with definite lives subject to amortization, (2) intangible assets with indefinite lives not subject to amortization and (3) goodwill. The Company determines the useful lives of definite-lived intangible assets after considering specific facts and circumstances related to each intangible asset. Factors the Company considers when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, and other economic facts; including competition and specific market conditions. Intangible assets that are deemed to have definite lives are amortized, primarily on a straight-line basis, over their estimated useful lives.


Intangible assets that are deemed to have indefinite lives, including goodwill, are reviewed for impairment annually on the anniversary of the acquisition, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test for indefinite-lived intangibles, other than goodwill, consists of a comparison of the fair value of the intangible asset with its carrying amount. If the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess. Indefinite-lived intangible assets, such as goodwill, are not amortized. The Company will qualitatively test the carrying amounts of goodwill for recoverability on an annual basis or when events or changes in circumstances indicate evidence a potential impairment exists, using a fair value-based test. No impairment existed at June 30, 2018.


In-process research and development, or IPR&D, assets are considered to be indefinite-lived until the completion or abandonment of the associated research and development projects. IPR&D assets represent the fair value assigned to technologies that the Company acquires, which at the time of acquisition have not reached technological feasibility and have no alternative future use. During the period that the assets are considered indefinite-lived, they are tested for impairment on an annual basis, or more frequently if the Company becomes aware of any events occurring or changes in circumstances that indicate that the fair value of the IPR&D assets are less than their carrying amounts. If and when development is complete, which generally occurs upon regulatory approval and the ability to commercialize products associated with the IPR&D assets, these assets are then deemed definite-lived and are amortized based on their estimated useful lives at that point in time. If development is terminated or abandoned, the Company may have a full or partial impairment charge related to the IPR&D assets, calculated as the excess of carrying value of the IPR&D assets over fair value. No impairment existed at June 30, 2018.


Contingent Consideration

 

Consideration paid in a business combination may include potential future payments that are contingent upon the acquired business achieving certain milestones in the future (“contingent consideration”). Contingent consideration liabilities are measured at their estimated fair value as of the date of acquisition, with subsequent changes in fair value recorded in the consolidated statements of operations. The Company estimates the fair value of the contingent consideration as of the acquisition date using the estimated future cash outflows based on the probability of meeting future milestones. The milestone payments will be made upon the achievement of clinical and commercialization milestones as well as single low digit royalty payments and payments upon receipt of sublicensing income. Subsequent to the date of acquisition, the Company will reassess the actual consideration earned and the probability-weighted future earn-out payments at each balance sheet date. Any adjustment to the contingent consideration liability will be recorded in the consolidated statements of operations. Contingent consideration liabilities are presented in long-term liabilities in the consolidated balance sheets (see Note 2).


Revenue Recognition


Effective January 1, 2018, the Company has adopted on a modified retrospective basis Accounting Standards Codification (ASC) Topic 606.


The Company’s sole source of revenue is grant revenue related to the CPRIT Contract, which is being accounted for under ASC 606. ASC 606 introduces a new framework for analyzing potential revenue transactions by identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations in the contract, and recognizing revenue when (or as) the Company satisfies a performance obligation.


The performance obligations of the CPRIT Contract include developing a human TNFRSF25 agonist antibody for use in cancer patients through research and development efforts and a noncommercial license from CPRIT-funded research to CPRIT and other government agencies and institutions of higher education in Texas.


Management has concluded that the license and R&D services should be combined into a single performance obligation as both are highly interdependent - a license cannot be effectively granted without the corresponding research basis and CPRIT cannot benefit from the license without the R&D services and are therefore not capable of being distinct.


The CPRIT grant covers a three-year period from June 1, 2017 through May 31, 2019, for a total grant award of up to $15.2 million. CPRIT advances grant funds upon request by the Company consistent with the agreed upon amounts and schedules as provided in the contract. The first tranche of funding of $1.8 million was received in May 2017, and a second tranche of funding of $6.5 million was received in October 2017. The next tranche of funding is expected to be requested and received in late 2018. Funds received are reflected in deferred revenue as a liability until revenue is earned.  Grant revenue is recognized when qualifying costs are incurred.


Deferred Revenue


As of June 30, 2018, deferred revenue is comprised of proceeds of $4.9 million received from CPRIT for which the costs have not been incurred or the conditions of the award have not been met and $0.2 million of grant funds received from an economic development grant agreement with the City of San Antonio (“Economic Development Grant”), for the purpose of defraying costs toward the purchase of laboratory equipment. As of June 30, 2018, the deferred revenue balance was $5.1 million with $3.4 million recognized as revenue from CPRIT since the CPRIT contract inception.


Prepaid Expenses and Other Current Assets


The Company’s prepaid expenses and other current assets consists primarily of the amount paid in advance for cGMP production of Pelican’s PTX-35 antibody and PTX-15 fusion protein, as well as Chemistry Manufacturing and Control (“CMC”) material for the Company’s clinical trial studies for HS-110.


Income Taxes


The Company accounts for income taxes using the asset and liability method, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent that utilization is not presently more likely than not.


Significant Accounting Policies


The significant accounting policies used in preparation of these interim financial statements are disclosed in the Company's Form 10-K and have not changed significantly since such filing.


Recently Issued Accounting Pronouncements


In June 2018, the FASB issued ASU 2018-07: Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This ASU expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees, and as a result, the accounting for share-based payments to non-employees will be substantially aligned. ASU 2018-07 is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year, early adoption is permitted but no earlier than an entity’s adoption date of Topic 606. The Company has not determined the impact of this standard and does not plan early adoption of this standard.


In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805) to clarify the definition of a business, which is fundamental in the determination of whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses combinations. The updated guidance requires that in order to be considered a business the integrated set of assets and activities acquired must include, at a minimum, an input and process that contribute to the ability to create output. If substantially all of the fair value of the assets acquired is concentrated in a single identifiable asset or group of similar assets, it is not considered a business, and therefore would not be considered a business combination. The update is effective for fiscal years beginning after December 15, 2018, and interim periods with fiscal years beginning after December 15, 2019, with early adoption permitted. The Company has not determined the impact of this standard and does not plan early adoption of this standard.


In August 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230)—Restricted Cash. ASU 2016-18 requires the statement of cash flows to be a reconciliation between beginning and ending cash balances inclusive of restricted cash balances. ASU 2016-18 is effective for fiscal years beginning after December 15, 2017 and is to be applied using a retrospective transition method to each period presented. The Company adopted this ASU for the year ending December 31, 2018. The adoption of this standard resulted in the removal of changes in Restricted Cash from the Consolidated Statements of Cash Flows of $1,122 and $98,879 for the six months ended June 30, 2018 and 2017, respectively and inclusion of these amounts as part of the starting and ending cash balances.


In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), requiring lessees to recognize for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and (2) a right-of-use (“ROU”) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The update is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2020. The Company currently anticipates that upon adoption of the new standard, ROU assets and lease liabilities will be recognized in amounts that will be immaterial to the consolidated balance sheets.

XML 20 R9.htm IDEA: XBRL DOCUMENT v3.10.0.1
Acquisition of Pelican Therapeutics
6 Months Ended
Jun. 30, 2018
Business Combinations [Abstract]  
Acquisition of Pelican Therapeutics

2. Acquisition of Pelican Therapeutics


On April 28, 2017, the Company consummated the acquisition of 80% of the outstanding equity of Pelican, a related party, and Pelican became a majority owned subsidiary of the Company. Operations of Pelican are included in the consolidated statements of operations and comprehensive loss from the acquisition date. Pelican is a biotechnology company focused on the development and commercialization of monoclonal antibody and fusion protein-based therapies that are designed to activate the immune system. In exchange for 80% of the outstanding capital stock of Pelican on a fully diluted basis, the Company paid to the Pelican Stockholders that executed the Stock Purchase Agreement (the “Participating Pelican Stockholders”) an aggregate of $0.5 million minus certain liabilities (the “Cash Consideration”), and issued to the Participating Pelican Stockholders 133,106 shares of the Company’s restricted common stock representing 4.99% of the outstanding shares of our common stock on the date of the initial execution of the Purchase Agreement (the “Stock Consideration”). During the six months ended June 30, 2018, the Cash Consideration of approximately $0.3 million was distributed to the Participating Pelican Stockholders and the remainder of approximately $0.2 million for certain Pelican liabilities not satisfied was recognized as other income in the Consolidated Statements of Operations and Comprehensive Loss.  


Under the agreement, the Company is also obligated to make future payments based on the achievement of certain clinical and commercialization milestones, as well as low single digit royalty payments and payments upon receipt of sublicensing income:


(1)

$2,000,000 upon Pelican’s dosing of the first patient in its first Phase 1 trial for an oncology indication;

(2)

$1,500,000 upon Pelican’s dosing of the first patient in its first Phase 2 trial for an oncology indication;

(3)

$3,000,000 upon successful outcome of the first Phase 2 trial for an oncology indication;

(4)

$6,000,000 upon Pelican’s dosing of the first patient in its first Phase 3 trial for an oncology indication;

(5)

$3,000,000 upon Pelican’s dosing of the first patient in its first Phase 3 trial for a non- oncology indication;

(6)

$7,500,000 upon successful outcome of the first Phase 3 trial for an oncology indication;

(7)

$3,000,000 upon successful outcome of the first Phase 3 trial for a non-oncology indication;

(8)

$7,500,000 upon acceptance of a Biologics License Application (BLA) submission for an oncology indication;

(9)

$3,000,000 upon acceptance of a BLA submission for a non-oncology indication;

(10)

$7,500,000 upon first product indication approval in the United States or Europe for an oncology indication;

(11)

$3,000,000 upon first product indication approval in the United States or Europe for a non-oncology indication.


The fair value of these future milestone payments is reflected in the contingent consideration account under long term liabilities on the balance sheet. The estimated fair value of the contingent consideration was determined using a probability-weighted income approach, at a discount of 6.49% based on the median yield of publicly traded non-investment grade debt of companies in the pharmaceutical industry. The Company performs an analysis on a quarterly basis and as of June 30, 2018, the Company determined the change in the estimated fair value of the contingent consideration was $539,980 for the quarter ended June 30, 2018.


The Company has recorded the assets purchased and liabilities assumed at their estimated fair value in accordance with FASB ASC Topic 805: Business Combinations. The purchase price exceeded the fair value of the net assets acquired resulting in goodwill of approximately $2.2 million. The identifiable indefinite-lived intangible asset consists of in-process R&D of approximately $5.9 million. The estimated fair value of the IPR&D was determined using a probability-weighted income approach, which discounts expected future cash flows to present value. The projected cash flows were based on certain key assumptions, including estimates of future revenue and expenses, taking into account the stage of development of the technology at the acquisition date and the time and resources needed to complete development. The Company utilized corporate bond yield data observed in the bond market to develop the discount rate utilized in the cash flows that have been probability adjusted to reflect the risks of product commercialization, which the Company believes are appropriate and representative of market participant assumptions. Operations of the acquired entity are included in the consolidated statements of operations from the acquisition date. 


The purchase price has been allocated to the assets and liabilities as follows: 


Aggregate consideration:

 

 

 

Cash consideration

 

$

500,000

 

Stock consideration

 

$

1,052,000

 

Contingent consideration

 

$

2,385,000

 

Total Consideration

 

$

3,937,000

 

 

 

 

 

 

 

 

 

 

 

Purchase price allocation:

 

 

 

 

Cash acquired

 

$

31,199

 

In-process R&D

 

$

5,866,000

 

Goodwill

 

$

2,189,338

 

Deferred tax liability

 

$

(2,111,760

)

Net liabilities assumed

 

$

(1,102,777

)

Fair value of non-controlling interest

 

$

(935,000

)

Total purchase price

 

$

3,937,000

 


Goodwill is calculated as the difference between the acquisition-date fair value of the consideration transferred and the fair values of the assets acquired and liabilities assumed. The goodwill resulting from this acquisition arises largely from synergies expected from combining the operations. The goodwill is not deductible for income tax purposes.


In-process R&D assets are treated as indefinite-lived until the completion or abandonment of the associated R&D program, at which time the appropriate useful lives will be determined.


The Company calculated the fair value of the non-controlling interest acquired in the acquisition as 20% of the equity interest of Pelican, adjusted for a minority interest discount.


In May 2016, Pelican was awarded a $15.2 million CPRIT Grant from CPRIT for development of Pelican’s lead product candidate, PTX-35. The CPRIT Grant is expected to allow Pelican to develop PTX-35 through a 70-patient Phase 1 clinical trial. The Phase 1 clinical trial will be designed to evaluate PTX-35 in combination with other immunotherapies. The CPRIT Grant is subject to customary CPRIT funding conditions including a matching funds requirement where Pelican will match $0.50 for every $1.00 from CPRIT. Consequently, Pelican is required to raise $7.6 million in matching funds over the three year project.


Pelican has contributed net revenue of $1.9 million and net loss of $1.2 million, respectively, which are included in the Company’s consolidated statement of operations and comprehensive loss for the six months ended June 30, 2018.


The following unaudited pro forma information presents the combined results of operations for the three and six months ended June 30, 2018 and 2017, as if the Company had completed the Pelican acquisition at the beginning of fiscal 2017. The pro forma financial information is provided for comparative purposes only and is not necessarily indicative of what actual results would have been had the acquisition occurred on the date indicated, nor does it give effect to synergies, cost savings, fair market value adjustments, immaterial amortization expense and other changes expected to result from the acquisition. Accordingly, the pro forma financial results do not purport to be indicative of consolidated results of operations as of the date hereof, for any period ended on the date hereof, or for any other future date or period.


 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2018

 

2017

 

 

2018

 

 

2017

 

Revenue

 

$

1,143,177

 

$

411,250

 

 

$

1,895,704

 

 

$

435,490

 

Net loss

 

 

(4,246,805

)

 

(3,310,791

)

 

 

(7,980,032

)

 

 

(6,940,735

)

Net loss: Non-controlling interest

 

 

(196,734

)

 

(90,508

)

 

 

(403,195

)

 

 

(219,142

)

Net loss attributable to Heat Biologics, Inc.

 

$

(4,050,071

)

$

(3,220,283

)

 

$

(7,576,837

)

 

$

(6,721,593

)

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

  

Net loss per share attributable to Heat Biologics, Inc.—basic and diluted

 

$

(0.27

)

$

(0.88

)

 

$

(0.77

)

 

$

(2.07

)

XML 21 R10.htm IDEA: XBRL DOCUMENT v3.10.0.1
Fair Value of Financial Instruments
6 Months Ended
Jun. 30, 2018
Fair Value Disclosures [Abstract]  
Fair Value of Financial Instruments

3. Fair Value of Financial Instruments


The carrying amount of certain of the Company’s financial instruments, including cash and cash equivalents, restricted cash, accounts payable and accrued expenses and other payables approximate fair value due to their short maturities.


As a basis for determining the fair value of certain of the Company’s financial instruments, the Company utilizes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:


Level I – Observable inputs such as quoted prices in active markets for identical assets or liabilities.


Level II – Observable inputs, other than Level I prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.


Level III – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.


This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the entire fair value measurement requires management to make judgments and consider factors specific to the asset or liability. The Company's cash equivalents are classified within Level I of the fair value hierarchy.


The following table provides a rollforward of the Company’s Level 3 fair value measurements:


 

 

Contingent Consideration

 

Balance at December 31, 2017

 

$

2,609,289

 

Change in fair value

 

 

551,098

 

Balance at June 30, 2018

 

$

3,160,387

 


The change in the fair value of the contingent consideration of $551,098 for the six months ended June 30, 2018 reflects an increase in the probability of reaching Pelican’s dosing of the first patient in its first Phase 1 trial for an oncology indication based on the passage of time and impact of progress in antibody manufacturing. Adjustments associated with the change in fair value of contingent consideration are included in the Company’s consolidated statement of operations and comprehensive loss.


The following table presents quantitative information about the inputs and valuation methodologies used for the Company’s fair value measurements of contingent consideration classified as Level 3 as of June 30, 2018:


 

 

Valuation
Methodology

 

Significant
Unobservable Input

 

Weighted Average
(range, if applicable)

 

 

 

 

 

 

 

Contingent Consideration

 

Probability weighted
income approach

 

Milestone dates

 

2019-2026

 

 

 

 

Discount rate

 

11.68% to 4.50%

 

 

 

 

Probability of occurrence

 

23% - 86%

XML 22 R11.htm IDEA: XBRL DOCUMENT v3.10.0.1
Prepaid Expenses and Other Current Assets
6 Months Ended
Jun. 30, 2018
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Prepaid Expenses and Other Current Assets

4. Prepaid Expenses and Other Current Assets


Prepaid expenses and other current assets consist of the following at:


 

 

June 30,

2018

 

December 31,
2017

 

 

 

 

 

 

  

Prepaid manufacturing expense

 

$

3,810,178

 

$

1,551,597

 

Prepaid insurance

 

 

31,250

 

 

218,750

 

Other prepaid expenses

 

 

146,387

 

 

87,937

 

Other current assets

 

 

20,000

 

 

108,973

 

 

 

$

4,007,815

 

$

1,967,257

 

XML 23 R12.htm IDEA: XBRL DOCUMENT v3.10.0.1
Property and Equipment
6 Months Ended
Jun. 30, 2018
Property, Plant and Equipment [Abstract]  
Property and Equipment

5. Property and Equipment


Property and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives, ranging generally from five to seven years. Expenditures for maintenance and repairs are charged to expense as incurred.


Property and equipment consisted of the following:


 

 

June 30,

2018

 

December 31,
2017

 

 

 

 

 

 

  

Furniture and fixtures

 

$

55,883

 

$

55,883

 

Computers

 

 

26,383

 

 

41,333

 

Lab equipment

 

 

1,116,307

 

 

645,433

 

 

 

 

 

 

 

 

 

Total

 

 

1,198,573

 

 

742,649

 

Accumulated depreciation

 

 

(552,839

)

 

(455,758

)

 

 

 

 

 

 

 

 

Property and equipment, net

 

$

645,734

 

$

286,891

 


Depreciation expense was $108,408 and $66,671 for the six months ended June 30, 2018 and 2017, respectively.

XML 24 R13.htm IDEA: XBRL DOCUMENT v3.10.0.1
Goodwill and In-process R&D
6 Months Ended
Jun. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and In-process R&D

6. Goodwill and In-Process R&D


Goodwill of $2.2 million and in-process R&D of $5.9 million were recorded in connection with the acquisition of Pelican, as described in Note 2. The carrying value of goodwill and in-process R&D has remained unchanged and no impairment was recognized as of June 30, 2018 and December 31, 2017.

XML 25 R14.htm IDEA: XBRL DOCUMENT v3.10.0.1
Accrued Expenses and other payables
6 Months Ended
Jun. 30, 2018
Accrued Liabilities, Current [Abstract]  
Accrued Expenses and other payables

7. Accrued Expenses and other payables


Accrued expenses and other payables consist of the following:


 

 

June 30,
2018

 

December 31,
2017

 

 

 

 

 

 

 

 

 

Accrued clinical trial and other expenses

 

$

1,226,998

 

$

1,504,240

 

Compensation and related benefits

 

 

88,518

 

 

542,434

 

Deferred rent

 

 

18,051

 

 

27,457

 

Patent fees

 

 

30,000

 

 

40,000

 

Other expenses

 

 

82,300

 

 

162,300

 

 

 

$

1,445,867

 

$

2,276,431

 

XML 26 R15.htm IDEA: XBRL DOCUMENT v3.10.0.1
Stock-Based Compensation
6 Months Ended
Jun. 30, 2018
Stock-based Compensation [Abstract]  
Stock-Based Compensation

8. Stock-Based Compensation


Stock Options


The following is a summary of the stock option activity for the six months ended June 30, 2018:


 

 

Shares

 

 

Weighted

Average

Exercise

Price

 

Outstanding, December 31, 2017

 

 

266,884

 

 

$

19.57

 

Granted

 

 

173,336

 

 

 

3.97

 

Forfeited

 

 

(15,628

)

 

 

32.80

 

Outstanding, June 30, 2018

 

 

424,592

 

 

$

12.72

 


The weighted average grant-date fair value of stock options granted during the six months ended June 30, 2018 was $2.84. The fair value of each stock option was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions for stock options granted during the six months ended June 30, 2018:


Dividend yield

 

 

0.0

%

Expected volatility

 

 

83.96

%

Risk-free interest rate

 

 

2.34

%

Expected lives (years)

 

 

6.3

 


The risk-free interest rate is based on U.S. Treasury interest rates at the time of the grant whose term is consistent with the expected life of the stock options. The Company used an average historical stock price volatility based on an analysis of reported data for a peer group of comparable companies that have issued stock options with substantially similar terms, as the Company did not have sufficient trading history for its common stock. Expected term represents the period that the Company’s stock option grants are expected to be outstanding. The Company elected to utilize the “simplified” method to estimate the expected term. Under this approach, the weighted-average expected life is presumed to be the average of the vesting term and the contractual term of the option.


Expected dividend yield was considered to be 0% in the option pricing formula since the Company had not paid any dividends and had no plans to do so in the future. The forfeiture rate was considered to be none as the options vest on a monthly basis.


The Company recognized $108,340 and $123,418 in stock-based option compensation expense for the three months ended June 30, 2018 and 2017, respectively and $242,147 and $245,142 in stock-based option compensation expense for the six months ended June 30, 2018 and 2017, respectively. The following table summarizes information about stock options outstanding at June 30, 2018:


Options Outstanding

 

 

Options Vested and Exercisable

 

6/30/2018

 

 

Weighted

Average

Remaining

Contractual

Life

(Years)

 

 

Weighted

Average

Exercise

Price

 

 

Balance

as of

6/30/2018

 

 

Weighted

Average

Remaining

Contractual

Life

(Years)

 

 

Weighted

Average

Exercise

Price

 

424,592

 

 

8.5

 

 

$12.72

 

 

161,461

 

 

7.4

 

 

$24.06

 


As of June 30, 2018, the unrecognized stock-based compensation expense related to unvested stock options was $1,522,789, which is expected to be recognized over a weighted average period of approximately 17.31 months.


Restricted Stock


The Company recognized $31,097 and $19,686 in stock-based compensation expense for employees related to restricted stock awards during the three months ended June 30, 2018 and 2017, respectively, and $265,228 and $136,207 in stock-based compensation expense for employees related to restricted stock awards during the six months ended June 30, 2018 and 2017, respectively. The Company recognized $802 and $10,500 in share-based compensation expense related to issuance of shares of restricted stock to non-employees (i.e., consultants) in exchange for services during the three months ended June 30, 2018 and 2017, respectively and $4,757 and $21,000 in share-based compensation expense related to issuance of shares of restricted stock to non-employees (i.e., consultants) in exchange for services during the six months ended June 30, 2018 and 2017, respectively. As of June 30, 2018, there were 62,207 restricted stock awards granted to employees and non-employees, all of which were unvested.


Total stock-based compensation expense, including restricted stock and stock options was $512,120 and $402,349 for the six months ended June 30, 2018 and 2017, respectively.

XML 27 R16.htm IDEA: XBRL DOCUMENT v3.10.0.1
Financing
6 Months Ended
Jun. 30, 2018
Stockholders' Equity Note [Abstract]  
Financing

9. Financing


Public Offering


On May 7, 2018, the Company closed an underwritten public offering (the “Offering”) in which it issued and sold (i) 4,875,000 shares of common stock together with a number of common warrants to purchase 2,437,500 shares of its common stock, and (ii) 9,500,000 pre-funded warrants, with each pre-funded warrant exercisable for one share of common stock, together with a number of common warrants to purchase 4,750,000 shares of its common stock. The public offering price was $1.44 per share of common stock, $1.43 per pre-funded warrant and $0.01 per common warrant. The net proceeds to the Company were approximately $18.8 million, net of underwriting discounts and commissions and other estimated offering expenses. The common stock warrants expire five years after date of issuance and have an exercise price of $1.584 per share. As of June 30, 2018, 3,054,667 common stock warrants have been exercised for an additional $4.8 million of proceeds to the Company and all pre-funded warrants have been exercised. In connection with the offering the Company entered into an underwriting agreement (the “Underwriting Agreement”), dated May 2, 2018 with A.G.P./Alliance Global Partners (A.G.P.), as representative of the underwriters. The Underwriting Agreement contains customary representations, warranties, and agreements by the Company, customary conditions to closing, indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act of 1933, as amended (the “Securities Act”), other obligations of the parties and termination provisions.


At the Market Offering


On January 18, 2018, the Company entered into a Common Stock Sales Agreement with H.C. Wainwright & Co., LLC, (“HCW”) as sales agent, pursuant to which the Company may sell from time to time, at its option, shares of its common stock, par value $0.0002 per share for the sale of up to $3,658,000 of shares of the Company’s common stock and on March 15, 2018 issued a prospectus supplement for an additional aggregate offering price of up to $1,300,000. Sales of shares of common stock have been made pursuant to the Company’s shelf registration statement on Form S-3 (File No. 333-221201) filed with the U.S. Securities and Exchange Commission (“SEC”), dated November 13, 2017. As of June 30, 2018 the Company sold an aggregate of 1,403,367 shares of common stock under the HCW Sales Agreement resulting in net proceeds of approximately $3.4 million.


Common Stock Warrants


In connection with the May 7, 2018 public offering, the Company issued 9,500,000 pre-funded warrants and 7,187,500 common stock warrants each of which are exercisable for one share of common stock. The pre-funded warrants had an exercise price of $0.01 per share and as of June 30, 2018 all pre-funded warrants have been exercised. The common stock warrants have an exercise price of $1.584 per share and expire five years from the issuance date. As of June 30, 2018, 3,054,667 common stock warrants have been exercised. The warrants have been accounted for as equity instruments. The fair value of the common stock warrants of approximately $7.8 million at the date of issuance was estimated using the Black-Scholes Merton model which used the following inputs: term of 5 years, risk free rate of 2.78%, 0% dividend yield, volatility of 124.14%, and share price of $1.30 per share based on the trading price of the Company’s common stock.


In connection with the March 23, 2017 public offering the Company issued warrants to purchase 682,500 shares of common stock with an exercise price of $10.00 per share that expire five years from the issuance date. In connection with the Company’s July 23, 2013 initial public offering, the Company issued warrants to the underwriters for 12,500 shares of common stock issuable at $125.00 per share upon exercise that expire five years from the issuance date. On March 10, 2011, the Company issued warrants to purchase shares of common stock to third parties in consideration for a private equity placement transaction of which 1,738 warrants remain outstanding. The warrants have an exercise price of $4.80 per share and expire ten years from the issuance date.


During the six months ended June 30, 2018, 3,054,667 common stock warrants have been exercised and no warrants were exercised during the same period in 2017. The Company has outstanding warrants to purchase 4,132,833 shares of common stock issuable at $1.584 per share, 296,159 shares of common stock issuable at $10.00 per share; warrants to purchase 12,500 shares of common stock issuable at $125.00 per share; and warrants to purchase 1,738 shares of common stock issuable at $4.80 per share. These warrants do not meet the criteria required to be classified as liability awards and therefore are treated as equity awards.

XML 28 R17.htm IDEA: XBRL DOCUMENT v3.10.0.1
Grant and Licensing Revenues
6 Months Ended
Jun. 30, 2018
Revenue Recognition and Deferred Revenue [Abstract]  
Grant and Licensing Revenues

10. Grant and Licensing Revenues


In June 2016, Pelican entered into a Cancer Research Grant Contract (“Grant Contract”) with CPRIT, under which CPRIT awarded a grant not to exceed $15.2 million for use in developing cancer treatments by targeting a novel T-cell costimulatory receptor (namely, TNFRSF25). The Grant Contract covers a three-year period from June 1, 2016 through May 31, 2019.


Upon commercialization of the product, the terms of the Grant Contract require Pelican to pay tiered royalties in the low to mid-single digit percentages. Such royalties reduce to less than one percent after a mid-single-digit multiple of the grant funds have been paid to CPRIT in royalties.


The Company recognized grant revenue of approximately $1.1 million and $1.9 million during the three and six months ended June 30, 2018 for qualified expenditures under the grant. The Company recognized grant revenue during the three months ended June 30, 2017 of approximately $0.4 million and for the six months ended June 30, 2017 revenue included an additional $0.02 million of research funding revenue for research and development services, provided to Shattuck Labs, Inc. which research funding agreement terminated January 31, 2017.


As of June 30, 2018, the Company had deferred revenue of $5.1 million for proceeds received from the CPRIT grant, but for which the costs had not been incurred or the conditions of the award had not been met.

XML 29 R18.htm IDEA: XBRL DOCUMENT v3.10.0.1
Net Loss Per Share
6 Months Ended
Jun. 30, 2018
Earnings Per Share [Abstract]  
Net Loss Per Share

11. Net Loss Per Share


Basic and diluted net loss per common share is calculated by dividing net loss applicable to Heat Biologics, Inc. by the weighted-average number of common shares outstanding during the period, without consideration for common stock equivalents. The Company’s potentially dilutive shares, which include outstanding stock options and warrants, are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. The following table reconciles net loss to net loss attributable to Heat Biologics, Inc.:


 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2018

 

2017

 

 

2018

 

 

2017

 

Net loss

 

$

(4,246,805

)

$

(3,309,081

)

 

$

(7,980,032

)

 

$

(6,549,809

)

Net loss: Non-controlling interest

 

 

(196,734

)

 

(90,166

)

 

 

(403,195

)

 

 

(140,956

)

Net loss attributable to Heat Biologics, Inc.

 

$

(4,050,071

)

$

(3,218,915

)

 

$

(7,576,837

)

 

$

(6,408,853

)

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

  

Weighted-average number of common shares used in net loss per share attributable to Heat Biologics, Inc.—basic and diluted

 

 

14,727,682

 

 

3,524,483

 

 

 

9,894,367

 

 

 

3,112,412

 

Net loss per share attributable to Heat Biologics, Inc.—basic and diluted

 

$

(0.27

)

$

(0.91

)

 

$

(0.77

)

 

$

(2.06

)


The following potentially dilutive securities were excluded from the calculation of diluted net loss per share due to their anti-dilutive effect:


 

 

For the Six months Ended

June 30,

 

 

 

2018

 

2017

 

Outstanding stock options

 

 

424,592

 

 

252,000

 

Outstanding restricted stock units

 

 

62,207

 

 

30,623

 

Outstanding common stock warrants

 

 

4,443,230

 

 

310,397

 

XML 30 R19.htm IDEA: XBRL DOCUMENT v3.10.0.1
Income Tax
6 Months Ended
Jun. 30, 2018
Income Tax Disclosure [Abstract]  
Income Tax

12. Income Tax

 

Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases, operating loss carryforwards, and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. As of June 30, 2018, a full valuation allowance has been provided against certain deferred tax assets as it is currently deemed more likely than not that the benefit of such net tax assets will not be utilized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.


In accordance with FASB ASC 740, Accounting for Income Taxes, the Company reflects in the accompanying unaudited condensed consolidated financial statements the benefit of positions taken in a previously filed tax return or expected to be taken in a future tax return only when it is considered ‘more-likely-than-not’ that the position taken will be sustained by a taxing authority. As of June 30, 2018, and December 31, 2017, the Company had no unrecognized income tax benefits and correspondingly there is no impact on the Company’s effective income tax rate associated with these items. The Company’s policy for recording interest and penalties relating to uncertain income tax positions is to record them as a component of income tax expense in the accompanying statements of operations and comprehensive loss. As of June 30, 2018, and December 31, 2017, the Company had no such accruals.


On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was enacted into law. The Tax Act lowered the Federal corporate tax rate from 34% to 21% for periods beginning on or after January 1, 2018 and made numerous other tax law changes. The Company has measured deferred tax assets at the enacted tax rate expected to apply when these temporary differences are expected to be realized or settled. The Company is required to recognize the effect of tax law changes in the period of enactment. Additional federal and state interpretive guidance is still forthcoming that could potentially affect the measurement of these balances or give rise to new deferred tax amounts. As such, the remeasurement of our deferred tax balance is provisional pending future guidance. The Company reasonably anticipates that any such guidance will be available prior to December 31, 2018.

XML 31 R20.htm IDEA: XBRL DOCUMENT v3.10.0.1
Subsequent Events
6 Months Ended
Jun. 30, 2018
Subsequent Events [Abstract]  
Subsequent Events

13. Subsequent Events


On July 20, 2018, the Company’s Board of Directors, approved an amendment (the “Amendment”) to the Amended and Restated Bylaws of the Company. The Amendment, which was adopted effective as of July 20, 2018, provides that at each meeting of stockholders the presence in person or by proxy of the holders of shares of stock having one-third (1/3) of the shares of stock entitled to vote at the meeting is necessary to constitute a quorum.

 

On July 20, 2018, the previously scheduled 2018 Annual Meeting of Stockholders of the Company was adjourned due to the absence of a quorum due, in part, to lack of votes by shares held in certain European brokerage accounts.  On August 13, 2018, the Board of Directors of the Company approved October 2, 2018 as the new date of the 2018 Annual Meeting of Stockholders.

XML 32 R21.htm IDEA: XBRL DOCUMENT v3.10.0.1
Basis of Presentation and Significant Accounting Policies (Policies)
6 Months Ended
Jun. 30, 2018
Accounting Policies [Abstract]  
Basis of Presentation and Principles of Consolidation

Basis of Presentation and Principles of Consolidation


On January 19, 2018, the Company announced a reverse stock split of its shares of common stock at a ratio of one-for-ten. The reverse stock split took effect at 11 p.m. ET on January 19, 2018, and the Company’s common stock began to trade on a post-split basis at the market open on January 22, 2018. During the Company’s annual stockholders meeting held June 29, 2017, stockholders approved the Company’s reverse stock split and granted the board of directors the authority to implement and determine the exact split ratio within a specified range. When the reverse stock split became effective, every 10 shares of our issued and outstanding common stock were combined into one share of common stock. Effecting the reverse stock split reduced the number of issued and outstanding common stock from approximately 42 million shares to approximately 4.2 million. It also subsequently adjusted outstanding options issued under the Company’s equity incentive plan and outstanding warrants to purchase common stock.


The accompanying unaudited consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting. However, certain information or footnote disclosures normally included in complete financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company’s management, the unaudited consolidated financial statements in this Quarterly Report on Form 10-Q include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending December 31, 2018.


The consolidated financial statements as of and for the six months ended June 30, 2018 and 2017 included in this Quarterly Report on Form 10-Q are unaudited. The balance sheet as of December 31, 2017 is derived from the audited consolidated financial statements as of that date. The accompanying unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on March 2, 2018 (the “2017 Annual Report”).


On April 28, 2017, the Company completed the acquisition of an 80% controlling interest in Pelican Therapeutics, Inc. (“Pelican”), a related party prior to acquisition. Operations of Pelican are included in the consolidated statements of operations and comprehensive loss from the acquisition date.


The accompanying consolidated financial statements as of and for the six months ended June 30, 2018 and 2017 include the accounts of Heat Biologics, Inc. (“the Company”), and its subsidiaries, Heat Biologics I, Inc. (“Heat I”), Heat Biologics III, Inc. (“Heat III”), Heat Biologics IV, Inc. (“Heat IV”), Heat Biologics GmbH, Heat Biologics Australia Pty Ltd. and Zolovax. Additionally, as of the six months ended June 30, 2018 the accompanying consolidated financials include Pelican. The functional currency of the entities located outside the United States is the applicable local currency (the foreign entities). Assets and liabilities of the foreign entities are translated at period-end exchange rates.  Statement of operations accounts are translated at the average exchange rate during the period. The effects of foreign currency translation adjustments are included in other comprehensive loss, which is a component of accumulated other comprehensive loss in stockholders’ equity. All significant intercompany accounts and transactions have been eliminated in consolidation. At December 31, 2017 and June 30, 2018, the Company held a 92.5% controlling interest in Heat I and an 80% controlling interest in Pelican. All other subsidiaries are wholly owned. For the six months ended June 30, 2018 the Company recognized $161,994 in net loss non-controlling interest for Heat I and $241,201 in net loss non-controlling interest for Pelican. The Company accounts for its less than 100% interest in these subsidiaries in the consolidated financial statements in accordance with U.S. GAAP. Accordingly, the Company presents non-controlling interests as a component of stockholders’ equity on its consolidated balance sheets and reports non-controlling interest net loss under the heading “net loss – non-controlling interest” in the consolidated statements of operations and comprehensive loss.


The Company has an accumulated deficit of approximately $76.4 million as of June 30, 2018 and a net loss of approximately $8.0 million for the six months ended June 30, 2018 and has not generated significant revenue or positive cash flows from operations. In May 2018, through a public offering, the Company raised approximately $18.8 million, net of underwriting discounts and commissions and other estimated offering expenses, and an additional $4.8 million through the exercise of 3,054,667 warrants. On April 28, 2017, the acquisition of an 80% controlling interest in Pelican, a related party prior to acquisition, was completed. Pelican has been awarded a $15.2 million grant to fund preclinical and some clinical activities from the Cancer Prevention and Research Institute of Texas (“CPRIT”). The CPRIT grant is subject to customary CPRIT funding conditions. The Company believes the acquisition aligns its strategic focus and strengthens its position in the T-cell activation arena.

Cash Equivalents and Restricted Cash

Cash Equivalents and Restricted Cash


The Company considers all highly liquid instruments with an original maturity of six months or less to be cash equivalents. Restricted cash consists of deposits held by the US Patent and Trademark Office.

Use of Estimates

Use of Estimates


The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Estimates are used for, but not limited to, useful lives of fixed assets, income taxes and stock-based compensation. Actual results may differ from those estimates.

Segments

Segments


The Company has one reportable segment - the development of immunotherapies designed to activate and expand a patient's T-cell mediated immune system against cancer.

Business Combinations

Business Combinations


The Company accounts for acquisitions using the acquisition method of accounting, which requires that all identifiable assets acquired and liabilities assumed be recorded at their estimated fair values. The excess of the fair value of purchase consideration over the fair values of identifiable assets and liabilities is recorded as goodwill. When determining the fair values of assets acquired and liabilities assumed, management makes significant estimates and assumptions.

 

Critical estimates in valuing certain intangible assets include but are not limited to future expected cash flows from acquired patented technology. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. Other estimates associated with the accounting for acquisitions may change as additional information becomes available regarding the assets acquired and liabilities assumed (see Note 2).

Goodwill and In-Process Research and Development

Goodwill and In-Process Research and Development


The Company classifies intangible assets into three categories: (1) intangible assets with definite lives subject to amortization, (2) intangible assets with indefinite lives not subject to amortization and (3) goodwill. The Company determines the useful lives of definite-lived intangible assets after considering specific facts and circumstances related to each intangible asset. Factors the Company considers when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, and other economic facts; including competition and specific market conditions. Intangible assets that are deemed to have definite lives are amortized, primarily on a straight-line basis, over their estimated useful lives.


Intangible assets that are deemed to have indefinite lives, including goodwill, are reviewed for impairment annually on the anniversary of the acquisition, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test for indefinite-lived intangibles, other than goodwill, consists of a comparison of the fair value of the intangible asset with its carrying amount. If the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess. Indefinite-lived intangible assets, such as goodwill, are not amortized. The Company will qualitatively test the carrying amounts of goodwill for recoverability on an annual basis or when events or changes in circumstances indicate evidence a potential impairment exists, using a fair value-based test. No impairment existed at June 30, 2018.


In-process research and development, or IPR&D, assets are considered to be indefinite-lived until the completion or abandonment of the associated research and development projects. IPR&D assets represent the fair value assigned to technologies that the Company acquires, which at the time of acquisition have not reached technological feasibility and have no alternative future use. During the period that the assets are considered indefinite-lived, they are tested for impairment on an annual basis, or more frequently if the Company becomes aware of any events occurring or changes in circumstances that indicate that the fair value of the IPR&D assets are less than their carrying amounts. If and when development is complete, which generally occurs upon regulatory approval and the ability to commercialize products associated with the IPR&D assets, these assets are then deemed definite-lived and are amortized based on their estimated useful lives at that point in time. If development is terminated or abandoned, the Company may have a full or partial impairment charge related to the IPR&D assets, calculated as the excess of carrying value of the IPR&D assets over fair value. No impairment existed at June 30, 2018.

Contingent Consideration

Contingent Consideration

 

Consideration paid in a business combination may include potential future payments that are contingent upon the acquired business achieving certain milestones in the future (“contingent consideration”). Contingent consideration liabilities are measured at their estimated fair value as of the date of acquisition, with subsequent changes in fair value recorded in the consolidated statements of operations. The Company estimates the fair value of the contingent consideration as of the acquisition date using the estimated future cash outflows based on the probability of meeting future milestones. The milestone payments will be made upon the achievement of clinical and commercialization milestones as well as single low digit royalty payments and payments upon receipt of sublicensing income. Subsequent to the date of acquisition, the Company will reassess the actual consideration earned and the probability-weighted future earn-out payments at each balance sheet date. Any adjustment to the contingent consideration liability will be recorded in the consolidated statements of operations. Contingent consideration liabilities are presented in long-term liabilities in the consolidated balance sheets (see Note 2).

Revenue Recognition

Revenue Recognition


Effective January 1, 2018, the Company has adopted on a modified retrospective basis Accounting Standards Codification (ASC) Topic 606.


The Company’s sole source of revenue is grant revenue related to the CPRIT Contract, which is being accounted for under ASC 606. ASC 606 introduces a new framework for analyzing potential revenue transactions by identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations in the contract, and recognizing revenue when (or as) the Company satisfies a performance obligation.


The performance obligations of the CPRIT Contract include developing a human TNFRSF25 agonist antibody for use in cancer patients through research and development efforts and a noncommercial license from CPRIT-funded research to CPRIT and other government agencies and institutions of higher education in Texas.


Management has concluded that the license and R&D services should be combined into a single performance obligation as both are highly interdependent - a license cannot be effectively granted without the corresponding research basis and CPRIT cannot benefit from the license without the R&D services and are therefore not capable of being distinct.


The CPRIT grant covers a three-year period from June 1, 2017 through May 31, 2019, for a total grant award of up to $15.2 million. CPRIT advances grant funds upon request by the Company consistent with the agreed upon amounts and schedules as provided in the contract. The first tranche of funding of $1.8 million was received in May 2017, and a second tranche of funding of $6.5 million was received in October 2017. The next tranche of funding is expected to be requested and received in late 2018. Funds received are reflected in deferred revenue as a liability until revenue is earned.  Grant revenue is recognized when qualifying costs are incurred.

Deferred Revenue

Deferred Revenue


As of June 30, 2018, deferred revenue is comprised of proceeds of $4.9 million received from CPRIT for which the costs have not been incurred or the conditions of the award have not been met and $0.2 million of grant funds received from an economic development grant agreement with the City of San Antonio (“Economic Development Grant”), for the purpose of defraying costs toward the purchase of laboratory equipment. As of June 30, 2018, the deferred revenue balance was $5.1 million with $3.4 million recognized as revenue from CPRIT since the CPRIT contract inception.

Prepaid Expenses and Other Current Assets

Prepaid Expenses and Other Current Assets


The Company’s prepaid expenses and other current assets consists primarily of the amount paid in advance for cGMP production of Pelican’s PTX-35 antibody and PTX-15 fusion protein, as well as Chemistry Manufacturing and Control (“CMC”) material for the Company’s clinical trial studies for HS-110.

Income Taxes

Income Taxes


The Company accounts for income taxes using the asset and liability method, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent that utilization is not presently more likely than not.

Significant Accounting Policies

Significant Accounting Policies


The significant accounting policies used in preparation of these interim financial statements are disclosed in the Company's Form 10-K and have not changed significantly since such filing.

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements


In June 2018, the FASB issued ASU 2018-07: Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This ASU expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees, and as a result, the accounting for share-based payments to non-employees will be substantially aligned. ASU 2018-07 is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year, early adoption is permitted but no earlier than an entity’s adoption date of Topic 606. The Company has not determined the impact of this standard and does not plan early adoption of this standard.


In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805) to clarify the definition of a business, which is fundamental in the determination of whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses combinations. The updated guidance requires that in order to be considered a business the integrated set of assets and activities acquired must include, at a minimum, an input and process that contribute to the ability to create output. If substantially all of the fair value of the assets acquired is concentrated in a single identifiable asset or group of similar assets, it is not considered a business, and therefore would not be considered a business combination. The update is effective for fiscal years beginning after December 15, 2018, and interim periods with fiscal years beginning after December 15, 2019, with early adoption permitted. The Company has not determined the impact of this standard and does not plan early adoption of this standard.


In August 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230)—Restricted Cash. ASU 2016-18 requires the statement of cash flows to be a reconciliation between beginning and ending cash balances inclusive of restricted cash balances. ASU 2016-18 is effective for fiscal years beginning after December 15, 2017 and is to be applied using a retrospective transition method to each period presented. The Company adopted this ASU for the year ending December 31, 2018. The adoption of this standard resulted in the removal of changes in Restricted Cash from the Consolidated Statements of Cash Flows of $1,122 and $98,879 for the six months ended June 30, 2018 and 2017, respectively and inclusion of these amounts as part of the starting and ending cash balances.


In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), requiring lessees to recognize for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and (2) a right-of-use (“ROU”) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The update is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2020. The Company currently anticipates that upon adoption of the new standard, ROU assets and lease liabilities will be recognized in amounts that will be immaterial to the consolidated balance sheets.

XML 33 R22.htm IDEA: XBRL DOCUMENT v3.10.0.1
Acquisition of Pelican Therapeutics (Tables)
6 Months Ended
Jun. 30, 2018
Business Combinations [Abstract]  
Schedule of Assets Acquired and Liabilities Assumed in Acquisition

The purchase price has been allocated to the assets and liabilities as follows: 


Aggregate consideration:

 

 

 

Cash consideration

 

$

500,000

 

Stock consideration

 

$

1,052,000

 

Contingent consideration

 

$

2,385,000

 

Total Consideration

 

$

3,937,000

 

 

 

 

 

 

 

 

 

 

 

Purchase price allocation:

 

 

 

 

Cash acquired

 

$

31,199

 

In-process R&D

 

$

5,866,000

 

Goodwill

 

$

2,189,338

 

Deferred tax liability

 

$

(2,111,760

)

Net liabilities assumed

 

$

(1,102,777

)

Fair value of non-controlling interest

 

$

(935,000

)

Total purchase price

 

$

3,937,000

 

Schedule of Pro Forma Financial Information for Acquisition


 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2018

 

2017

 

 

2018

 

 

2017

 

Revenue

 

$

1,143,177

 

$

411,250

 

 

$

1,895,704

 

 

$

435,490

 

Net loss

 

 

(4,246,805

)

 

(3,310,791

)

 

 

(7,980,032

)

 

 

(6,940,735

)

Net loss: Non-controlling interest

 

 

(196,734

)

 

(90,508

)

 

 

(403,195

)

 

 

(219,142

)

Net loss attributable to Heat Biologics, Inc.

 

$

(4,050,071

)

$

(3,220,283

)

 

$

(7,576,837

)

 

$

(6,721,593

)

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

  

Net loss per share attributable to Heat Biologics, Inc.—basic and diluted

 

$

(0.27

)

$

(0.88

)

 

$

(0.77

)

 

$

(2.07

)

XML 34 R23.htm IDEA: XBRL DOCUMENT v3.10.0.1
Fair Value of Financial Instruments (Tables)
6 Months Ended
Jun. 30, 2018
Fair Value Disclosures [Abstract]  
Schedule of Level 3 Fair Value Measurements

The following table provides a rollforward of the Company’s Level 3 fair value measurements:


 

 

Contingent Consideration

 

Balance at December 31, 2017

 

$

2,609,289

 

Change in fair value

 

 

551,098

 

Balance at June 30, 2018

 

$

3,160,387

 

Schedule of Inputs and Valuation Methodologies Used for Fair Value of Contingent Consideration

The following table presents quantitative information about the inputs and valuation methodologies used for the Company’s fair value measurements of contingent consideration classified as Level 3 as of June 30, 2018:


 

 

Valuation
Methodology

 

Significant
Unobservable Input

 

Weighted Average
(range, if applicable)

 

 

 

 

 

 

 

Contingent Consideration

 

Probability weighted
income approach

 

Milestone dates

 

2019-2026

 

 

 

 

Discount rate

 

11.68% to 4.50%

 

 

 

 

Probability of occurrence

 

23% - 86%

XML 35 R24.htm IDEA: XBRL DOCUMENT v3.10.0.1
Prepaid Expenses and Other Current Assets (Tables)
6 Months Ended
Jun. 30, 2018
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Schedule of Prepaid Expenses and Other Current Assets


Prepaid expenses and other current assets consist of the following at:


 

 

June 30,

2018

 

December 31,
2017

 

 

 

 

 

 

  

Prepaid manufacturing expense

 

$

3,810,178

 

$

1,551,597

 

Prepaid insurance

 

 

31,250

 

 

218,750

 

Other prepaid expenses

 

 

146,387

 

 

87,937

 

Other current assets

 

 

20,000

 

 

108,973

 

 

 

$

4,007,815

 

$

1,967,257

 

XML 36 R25.htm IDEA: XBRL DOCUMENT v3.10.0.1
Property and Equipment (Tables)
6 Months Ended
Jun. 30, 2018
Property, Plant and Equipment [Abstract]  
Schedule of Property and Equipment

Property and equipment consisted of the following:


 

 

June 30,

2018

 

December 31,
2017

 

 

 

 

 

 

  

Furniture and fixtures

 

$

55,883

 

$

55,883

 

Computers

 

 

26,383

 

 

41,333

 

Lab equipment

 

 

1,116,307

 

 

645,433

 

 

 

 

 

 

 

 

 

Total

 

 

1,198,573

 

 

742,649

 

Accumulated depreciation

 

 

(552,839

)

 

(455,758

)

 

 

 

 

 

 

 

 

Property and equipment, net

 

$

645,734

 

$

286,891

 

XML 37 R26.htm IDEA: XBRL DOCUMENT v3.10.0.1
Accrued Expenses and other payables (Tables)
6 Months Ended
Jun. 30, 2018
Accrued Liabilities, Current [Abstract]  
Schedule of Accrued Expenses and other payables


Accrued expenses and other payables consist of the following:


 

 

June 30,
2018

 

December 31,
2017

 

 

 

 

 

 

 

 

 

Accrued clinical trial and other expenses

 

$

1,226,998

 

$

1,504,240

 

Compensation and related benefits

 

 

88,518

 

 

542,434

 

Deferred rent

 

 

18,051

 

 

27,457

 

Patent fees

 

 

30,000

 

 

40,000

 

Other expenses

 

 

82,300

 

 

162,300

 

 

 

$

1,445,867

 

$

2,276,431

 

XML 38 R27.htm IDEA: XBRL DOCUMENT v3.10.0.1
Stock-Based Compensation (Tables)
6 Months Ended
Jun. 30, 2018
Stock-based Compensation Tables  
Schedule of Stock Option Activity


The following is a summary of the stock option activity for the six months ended June 30, 2018:


 

 

Shares

 

 

Weighted

Average

Exercise

Price

 

Outstanding, December 31, 2017

 

 

266,884

 

 

$

19.57

 

Granted

 

 

173,336

 

 

 

3.97

 

Forfeited

 

 

(15,628

)

 

 

32.80

 

Outstanding, June 30, 2018

 

 

424,592

 

 

$

12.72

 

Schedule of Stock Option Valuation Assumptions

The fair value of each stock option was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions for stock options granted during the six months ended June 30, 2018:


Dividend yield

 

 

0.0

%

Expected volatility

 

 

83.96

%

Risk-free interest rate

 

 

2.34

%

Expected lives (years)

 

 

6.3

 

Schedule of Options Outstanding, Vested and Exercisable

The following table summarizes information about stock options outstanding at June 30, 2018:


Options Outstanding

 

 

Options Vested and Exercisable

 

6/30/2018

 

 

Weighted

Average

Remaining

Contractual

Life

(Years)

 

 

Weighted

Average

Exercise

Price

 

 

Balance

as of

6/30/2018

 

 

Weighted

Average

Remaining

Contractual

Life

(Years)

 

 

Weighted

Average

Exercise

Price

 

424,592

 

 

8.5

 

 

$12.72

 

 

161,461

 

 

7.4

 

 

$24.06

 

XML 39 R28.htm IDEA: XBRL DOCUMENT v3.10.0.1
Net Loss Per Share (Tables)
6 Months Ended
Jun. 30, 2018
Earnings Per Share [Abstract]  
Schedule of Net Loss Per Share

The following table reconciles net loss to net loss attributable to Heat Biologics, Inc.:


 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2018

 

2017

 

 

2018

 

 

2017

 

Net loss

 

$

(4,246,805

)

$

(3,309,081

)

 

$

(7,980,032

)

 

$

(6,549,809

)

Net loss: Non-controlling interest

 

 

(196,734

)

 

(90,166

)

 

 

(403,195

)

 

 

(140,956

)

Net loss attributable to Heat Biologics, Inc.

 

$

(4,050,071

)

$

(3,218,915

)

 

$

(7,576,837

)

 

$

(6,408,853

)

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

  

Weighted-average number of common shares used in net loss per share attributable to Heat Biologics, Inc.—basic and diluted

 

 

14,727,682

 

 

3,524,483

 

 

 

9,894,367

 

 

 

3,112,412

 

Net loss per share attributable to Heat Biologics, Inc.—basic and diluted

 

$

(0.27

)

$

(0.91

)

 

$

(0.77

)

 

$

(2.06

)

Schedule of Potentially Dilutive Securities

The following potentially dilutive securities were excluded from the calculation of diluted net loss per share due to their anti-dilutive effect:


 

 

For the Six months Ended

June 30,

 

 

 

2018

 

2017

 

Outstanding stock options

 

 

424,592

 

 

252,000

 

Outstanding restricted stock units

 

 

62,207

 

 

30,623

 

Outstanding common stock warrants

 

 

4,443,230

 

 

310,397

 

XML 40 R29.htm IDEA: XBRL DOCUMENT v3.10.0.1
Basis of Presentation and Significant Accounting Policies (Details) - USD ($)
1 Months Ended 3 Months Ended 6 Months Ended
Jan. 19, 2018
Oct. 31, 2017
May 31, 2017
Jun. 30, 2016
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Dec. 31, 2017
Noncontrolling Interest [Line Items]                  
Accumulated deficit         $ 76,423,163   $ 76,423,163   $ 68,846,326
Net loss         4,050,071 $ 3,218,915 7,576,837 $ 6,408,853  
Revenue         1,143,177 411,250 1,895,704 435,490  
Non-controlling interest         196,734 90,166 403,195 140,956  
Reimbursable funds             15,200,000    
Unearned revenue liability balance             3,400,000    
Removal of changes in restricted cash from Consolidated Statements of Cash Flows due to adoption of ASU 2016-18             1,122 98,879  
Reverse stock split When the reverse stock split became effective, every 10 shares of our issued and outstanding common stock were combined into one share of common stock. Effecting the reverse stock split reduced the number of issued and outstanding common stock from approximately 42 million shares to approximately 4.2 million.                
Proceeds from financings             18,800,000    
Proceeds from exercise of warrants             $ 4,838,593  
Number of warrant exercised             3,054,667  
Proceeds from deferred revenue             $ 4,900,000    
Grant received for preclinical activities from CPRIT             200,000    
Deferred revenue balance from CPRIT         5,100,000   5,100,000    
Grant Revenue [Member]                  
Noncontrolling Interest [Line Items]                  
Revenue         $ 1,100,000 $ 400,000 1,900,000 $ 400,000  
Heat Biologics I, Inc. [Member]                  
Noncontrolling Interest [Line Items]                  
Ownership interest in subsidiary                 92.50%
Non-controlling interest             161,994    
Pelican Therapeutics, Inc. [Member]                  
Noncontrolling Interest [Line Items]                  
Net loss             $ (1,200,000)    
Percentage of voting interests acquired in acquisition         80.00% 80.00% 80.00% 80.00%  
Revenue             $ 800,000    
Non-controlling interest             241,201    
Contract value             7,600,000    
Pelican Therapeutics, Inc. [Member] | Grant Revenue [Member]                  
Noncontrolling Interest [Line Items]                  
Revenue       $ 15,200,000     $ 1,900,000    
Pelican Therapeutics, Inc. [Member] | Second tranche [Member] | Grant Revenue [Member]                  
Noncontrolling Interest [Line Items]                  
Revenue   $ 6,500,000              
Pelican Therapeutics, Inc. [Member] | First tranche [Member] | Grant Revenue [Member]                  
Noncontrolling Interest [Line Items]                  
Revenue     $ 1,800,000            
XML 41 R30.htm IDEA: XBRL DOCUMENT v3.10.0.1
Acquisition of Pelican Therapeutics (Narrative) (Details) - USD ($)
1 Months Ended 3 Months Ended 6 Months Ended
Jun. 30, 2016
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Dec. 31, 2017
Business Acquisition [Line Items]            
Accrued liabilities   $ 1,445,867   $ 1,445,867   $ 2,276,431
Goodwill   2,189,338   2,189,338   $ 2,189,338
Revenue   1,143,177 $ 411,250 1,895,704 $ 435,490  
Net loss (income)   (4,050,071) (3,218,915) (7,576,837) (6,408,853)  
Grant Revenue [Member]            
Business Acquisition [Line Items]            
Revenue   $ 1,100,000 $ 400,000 $ 1,900,000 $ 400,000  
Pelican Therapeutics, Inc. [Member]            
Business Acquisition [Line Items]            
Percentage of voting interests acquired in acquisition   80.00% 80.00% 80.00% 80.00%  
Issuance of common stock Pelican, shares       133,106    
Percentage of outstanding common shares issued for equity consideration in business acquisition       4.99%    
Cash consideration       $ 500,000    
Accrued liabilities   $ 200,000   200,000    
Fair value of contingent consideration   539,980   539,980    
Goodwill   $ 2,189,338   2,189,338    
In-process R&D       $ 5,900,000    
Percentage of non-controlling interest acquired   20.00%   20.00%    
Revenue       $ 800,000    
Net loss (income)       1,200,000    
Contract value       7,600,000    
Pelican Therapeutics, Inc. [Member] | Grant Revenue [Member]            
Business Acquisition [Line Items]            
Revenue $ 15,200,000     1,900,000    
Pelican Therapeutics, Inc. [Member] | Stockholders [Member]            
Business Acquisition [Line Items]            
Cash consideration       $ 300,000    
XML 42 R31.htm IDEA: XBRL DOCUMENT v3.10.0.1
Acquisition of Pelican Therapeutics (Future Milestone Payments) (Details) - Pelican Therapeutics, Inc. [Member]
Jun. 30, 2018
USD ($)
Business Acquisition [Line Items]  
Future milestone payment upon Pelican's dosing of the first patient in its first Phase 1 trial for an oncology indication $ 2,000,000
Future milestone payment upon Pelican's dosing of the first patient in its first Phase 2 trial for an oncology indication 1,500,000
Future milestone payment upon successful outcome of the first Phase 2 trial for an oncology indication 3,000,000
Future milestone payment upon Pelican's dosing of the first patient in its first Phase 3 trial for an oncology indication 6,000,000
Future milestone payment upon Pelican's dosing of the first patient in its first Phase 3 trial for a non- oncology indication 3,000,000
Future milestone payment upon successful outcome of the first Phase 3 trial for an oncology indication 7,500,000
Future milestone payment upon successful outcome of the first Phase 3 trial for a non-oncology indication 3,000,000
Future milestone payment upon acceptance of a Biologics License Application (BLA) submission for an oncology indication 7,500,000
Future milestone payment upon acceptance of a BLA submission for a non-oncology indication 3,000,000
Future milestone payment upon first product indication approval in the United States or Europe for an oncology indication 7,500,000
Future milestone payment upon first product indication approval in the United States or Europe for a non- oncology indication $ 3,000,000
Discount rate used for calculation of fair value of contingent consideration 6.49%
XML 43 R32.htm IDEA: XBRL DOCUMENT v3.10.0.1
Acquisition of Pelican Therapeutics (Schedule of Purchase Price of Assets and Liabilities) (Details) - USD ($)
6 Months Ended
Jun. 30, 2018
Dec. 31, 2017
Purchase price allocation:    
Goodwill $ 2,189,338 $ 2,189,338
Pelican Therapeutics, Inc. [Member]    
Aggregate consideration:    
Cash consideration 500,000  
Stock consideration 1,052,000  
Contingent consideration 2,385,000  
Total Consideration 3,937,000  
Purchase price allocation:    
Cash acquired 31,199  
In-process R&D 5,866,000  
Goodwill 2,189,338  
Deferred tax liability (2,111,760)  
Net liabilities assumed (1,102,777)  
Fair value of non-controlling interest (935,000)  
Total purchase price $ 3,937,000  
XML 44 R33.htm IDEA: XBRL DOCUMENT v3.10.0.1
Acquisition of Pelican Therapeutics (Schedule of Pro Forma Financial Information for Acquisition) (Details) - USD ($)
3 Months Ended 6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Business Combinations [Abstract]        
Revenue $ 1,143,177 $ 411,250 $ 1,895,704 $ 435,490
Net loss (4,246,805) (3,310,791) (7,980,032) (6,940,735)
Net loss: Non-controlling interest (196,734) (90,508) (403,195) (219,142)
Net loss attributable to Heat Biologics, Inc. $ (4,050,071) $ (3,220,283) $ (7,576,837) $ (6,721,593)
Net loss per share attributable to Heat Biologics, Inc.-basic and diluted $ (0.27) $ (0.88) $ (0.77) $ (2.07)
XML 45 R34.htm IDEA: XBRL DOCUMENT v3.10.0.1
Fair Value of Financial Instruments (Schedule of Fair Value Measurements) (Details)
6 Months Ended
Jun. 30, 2018
USD ($)
Fair Value Disclosures [Abstract]  
Balance at December 31, 2017 $ 2,609,289
Change in fair value 551,098
Balance at June 30, 2018 $ 3,160,387
XML 46 R35.htm IDEA: XBRL DOCUMENT v3.10.0.1
Fair Value of Financial Instruments (Schedule of Inputs and Valuation Methodologies Used) (Details)
6 Months Ended
Jun. 30, 2018
Fair Value Disclosures [Abstract]  
Valuation Methodology Probability weighted income approach
Significant unobservable input - milestone dates 2019 - 2026
Discount rate - minimum 4.50%
Discount rate - maximum 11.68%
Probability of occurrence - minimum 23.00%
Probability of occurrence - maximum 86.00%
XML 47 R36.htm IDEA: XBRL DOCUMENT v3.10.0.1
Prepaid Expenses and Other Current Assets (Schedule of Prepaid Expenses and Other Current Assets) (Details) - USD ($)
Jun. 30, 2018
Dec. 31, 2017
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]    
Prepaid manufacturing expense $ 3,810,178 $ 1,551,597
Prepaid insurance 31,250 218,750
Other prepaid expenses 146,387 87,937
Other current assets 20,000 108,973
Prepaid expenses and other current assets $ 4,007,815 $ 1,967,257
XML 48 R37.htm IDEA: XBRL DOCUMENT v3.10.0.1
Property and Equipment (Details) - USD ($)
6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Dec. 31, 2017
Property, Plant and Equipment [Line Items]      
Total $ 1,198,573   $ 742,649
Accumulated depreciation (552,839)   (455,758)
Property and equipment, net 645,734   286,891
Depreciation expense $ 108,408 $ 66,671  
Minimum [Member]      
Property, Plant and Equipment [Line Items]      
Estimated useful lives 5 years    
Maximum [Member]      
Property, Plant and Equipment [Line Items]      
Estimated useful lives 7 years    
Furniture and fixtures [Member]      
Property, Plant and Equipment [Line Items]      
Total $ 55,883   55,883
Computers [Member]      
Property, Plant and Equipment [Line Items]      
Total 26,383   41,333
Lab equipment [Member]      
Property, Plant and Equipment [Line Items]      
Total $ 1,116,307   $ 645,433
XML 49 R38.htm IDEA: XBRL DOCUMENT v3.10.0.1
Accrued Expenses and other payables (Schedule of Accrued Expenses) (Details) - USD ($)
Jun. 30, 2018
Dec. 31, 2017
Accrued Liabilities, Current [Abstract]    
Accrued clinical trial and other expenses $ 1,226,998 $ 1,504,240
Compensation and related benefits 88,518 542,434
Deferred rent 18,051 27,457
Patent fees 30,000 40,000
Other expenses 82,300 162,300
Accrued expenses $ 1,445,867 $ 2,276,431
XML 50 R39.htm IDEA: XBRL DOCUMENT v3.10.0.1
Stock-Based Compensation (Narrative) (Details) - USD ($)
1 Months Ended 3 Months Ended 6 Months Ended
May 07, 2018
Jul. 23, 2013
Mar. 10, 2011
Mar. 23, 2017
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                  
Exercise price         $ 0.01   $ 0.01    
Stock based compensation             $ 512,120 $ 402,349  
Price per share $ 1.30 $ 125.00 $ 4.80 $ 10.00 $ 1.584   $ 1.584    
Warrants, expiry period 5 years 5 years   5 years          
Common stock issued for conversion of warrants 7,187,500 12,500 1,738 682,500          
Expiration period     10 years            
Warrants outstanding         4,132,833   4,132,833    
Warrants, exercise price $ 1.584           $ 1.584    
Risk free interest rate 2.78%           2.34%    
Dividend 0.00%           0.00%    
Volatility 124.14%                
Expected Term 5 years           6 years 3 months 19 days    
Weighted average grant-date fair value of stock options granted             $ 2.84    
Unrecognized stock-based compensation expense         $ 1,522,789   $ 1,522,789    
Unrecognized stock-based compensation expense, recognition period             1 year 5 months 9 days    
Warrants exercised             3,054,667  
Number of shares of common stock issuable through warrants 4,750,000                
Stock awards granted         424,592   424,592   266,884
Employees [Member]                  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                  
Stock awards granted         62,207   62,207    
Warrants to purchase common stock at $10.00 per share [Member]                  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                  
Price per share         $ 10.00   $ 10.00    
Warrants to purchase shares of common stock issuable at $125.00 per share [Member]                  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                  
Price per share         125.00   125.00    
Warrant [Member]                  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                  
Price per share         $ 10.00   $ 10.00    
Stock awards granted         296,159   296,159    
Stock options [Member]                  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                  
Stock based compensation         $ 108,340 $ 123,418 $ 242,147 $ 245,142  
Restricted Stock [Member] | Employees [Member]                  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                  
Stock based compensation         31,097 19,686 265,228 136,207  
Restricted Stock [Member] | Non Employees [Member]                  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                  
Stock based compensation         $ 802 $ 10,500 $ 802 $ 21,000  
XML 51 R40.htm IDEA: XBRL DOCUMENT v3.10.0.1
Stock-Based Compensation (Schedule of Stock Option Activity) (Details)
6 Months Ended
Jun. 30, 2018
$ / shares
shares
Shares  
Outstanding, December 31, 2017 | shares 266,884
Granted | shares 173,336
Forfeited | shares (15,628)
Outstanding, June 30, 2018 | shares 424,592
Weighted Average Exercise Price  
Outstanding, December 31, 2017 | $ / shares $ 19.57
Granted | $ / shares 3.97
Forfeited | $ / shares 32.80
Outstanding, June 30, 2018 | $ / shares $ 12.72
XML 52 R41.htm IDEA: XBRL DOCUMENT v3.10.0.1
Stock-Based Compensation (Schedule of Stock Option Valuation Assumptions) (Details)
6 Months Ended
May 07, 2018
Jun. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]    
Dividend yield 0.00% 0.00%
Expected volatility   83.96%
Risk-free interest rate 2.78% 2.34%
Expected lives (years) 5 years 6 years 3 months 19 days
XML 53 R42.htm IDEA: XBRL DOCUMENT v3.10.0.1
Stock-Based Compensation (Summary of Outstandng Stock Options) (Details)
6 Months Ended
Jun. 30, 2018
$ / shares
shares
Options Outstanding  
Balance | shares 424,592
Weighted Average Remaining Contractual Life (Years) 8 years 6 months
Weighted Average Exercise Price | $ / shares $ 12.72
Options Vested and Exercisable  
Balance | shares 161,461
Weighted Average Remaining Contractual Life (Years) 7 years 4 months 24 days
Weighted Average Exercise Price | $ / shares $ 24.06
XML 54 R43.htm IDEA: XBRL DOCUMENT v3.10.0.1
Financing (Details) - USD ($)
1 Months Ended 6 Months Ended
May 07, 2018
Jul. 23, 2013
Mar. 10, 2011
May 31, 2018
Mar. 23, 2017
Jun. 30, 2018
Jun. 30, 2017
Dec. 31, 2017
Class of Stock [Line Items]                
Issuance of common stock, shares           1,403,367    
Number of shares of common stock issuable through warrants 4,750,000              
Shares issued under offering 4,875,000         14,375,000    
Proceeds from sale of common stock $ 18,800,000     $ 4,800,000   $ 3,573,380 $ 2,461,880  
Warrants, expiry period 5 years 5 years     5 years      
Warrants, exercise price $ 1.584         $ 1.584    
Exercise of warrants, shares       3,054,667   3,054,667    
Common stock issued for conversion of warrants 7,187,500 12,500 1,738   682,500      
Fair value of common stock $ 7,800,000         $ 4,619   $ 840
Risk free interest rate 2.78%         2.34%    
Dividend 0.00%         0.00%    
Volatility 124.14%              
Price per share $ 1.30 $ 125.00 $ 4.80   $ 10.00 $ 1.584    
Warrants exercised           3,054,667  
Warrants outstanding           4,132,833    
Stock awards granted           424,592   266,884
Sales Agreement [Member]                
Class of Stock [Line Items]                
Total value of common stock that can be sold through Common Stock Sales Agreement           $ 3,658,000    
Shares issued under offering           1,300,000    
Proceeds from sale of common stock           $ 3,400,000    
Sale of stock           1,403,367    
Offering price per share           $ 0.0002    
Common stock warrants [Member]                
Class of Stock [Line Items]                
Number of shares of common stock issuable through warrants 9,500,000              
Public offering price $ 1.44              
Warrant [Member]                
Class of Stock [Line Items]                
Issuance of common stock, shares 2,437,500              
Public offering price $ 0.01              
Price per share           $ 10.00    
Stock awards granted           296,159    
Pre funded warrants [Member]                
Class of Stock [Line Items]                
Public offering price $ 1.43              
XML 55 R44.htm IDEA: XBRL DOCUMENT v3.10.0.1
Grant and Licensing Revenues (Details) - USD ($)
1 Months Ended 3 Months Ended 6 Months Ended
Jun. 30, 2016
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Dec. 31, 2017
Deferred Revenue Arrangement [Line Items]            
Revenue   $ 1,143,177 $ 411,250 $ 1,895,704 $ 435,490  
Deferred revenue   5,130,684   5,130,684   $ 7,026,388
Pelican Therapeutics, Inc. [Member]            
Deferred Revenue Arrangement [Line Items]            
Revenue       800,000    
Grant Revenue [Member]            
Deferred Revenue Arrangement [Line Items]            
Revenue   $ 1,100,000 400,000 1,900,000 400,000  
Grant Revenue [Member] | In-process R&D [Member]            
Deferred Revenue Arrangement [Line Items]            
Revenue     $ 20,000   $ 20,000  
Grant Revenue [Member] | Pelican Therapeutics, Inc. [Member]            
Deferred Revenue Arrangement [Line Items]            
Revenue $ 15,200,000     $ 1,900,000    
XML 56 R45.htm IDEA: XBRL DOCUMENT v3.10.0.1
Net Loss Per Share (Schedule of Reconciliation of Net Loss to Net Loss Attributable to Heat Biologics, Inc.) (Details) - USD ($)
3 Months Ended 6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Earnings Per Share [Abstract]        
Net loss $ (4,246,805) $ (3,309,081) $ (7,980,032) $ (6,549,809)
Net loss: Non-controlling interest (196,734) (90,166) (403,195) (140,956)
Net loss attributable to Heat Biologics, Inc. $ (4,050,071) $ (3,218,915) $ (7,576,837) $ (6,408,853)
Weighted-average number of common shares used in net loss per share attributable to Heat Biologics, Inc. - basic and diluted 14,727,682 3,524,483 9,894,367 3,112,412
Net loss per share attributable to Heat Biologics, Inc. - basic and diluted $ (0.27) $ (0.91) $ (0.77) $ (2.06)
XML 57 R46.htm IDEA: XBRL DOCUMENT v3.10.0.1
Net Loss Per Share (Schedule of Antidilutive Securities) (Details) - shares
6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Stock options [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Potentially dilutive securities 424,592 252,000
Restricted Stock [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Potentially dilutive securities 62,207 30,623
Common stock warrants [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Potentially dilutive securities 4,443,230 310,397
XML 58 R47.htm IDEA: XBRL DOCUMENT v3.10.0.1
Income Tax (Narrative) (Details) - USD ($)
6 Months Ended 12 Months Ended
Jun. 30, 2018
Dec. 31, 2017
Income Tax Disclosure [Abstract]    
Unrecognized income tax benefits $ 0 $ 0
Income tax expense accrued $ 0 $ 0
Corporate tax rate 21.00% 34.00%
EXCEL 59 Financial_Report.xlsx IDEA: XBRL DOCUMENT begin 644 Financial_Report.xlsx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�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end XML 60 Show.js IDEA: XBRL DOCUMENT /** * Rivet Software Inc. * * @copyright Copyright (c) 2006-2011 Rivet Software, Inc. All rights reserved. * Version 2.4.0.3 * */ var Show = {}; Show.LastAR = null, Show.hideAR = function(){ Show.LastAR.style.display = 'none'; }; Show.showAR = function ( link, id, win ){ if( Show.LastAR ){ Show.hideAR(); } var ref = link; do { ref = ref.nextSibling; } while (ref && ref.nodeName != 'TABLE'); if (!ref || ref.nodeName != 'TABLE') { var tmp = win ? win.document.getElementById(id) : document.getElementById(id); if( tmp ){ ref = tmp.cloneNode(true); ref.id = ''; link.parentNode.appendChild(ref); } } if( ref ){ ref.style.display = 'block'; Show.LastAR = ref; } }; Show.toggleNext = function( link ){ var ref = link; do{ ref = ref.nextSibling; }while( ref.nodeName != 'DIV' ); if( ref.style && ref.style.display && ref.style.display == 'none' ){ ref.style.display = 'block'; if( link.textContent ){ link.textContent = link.textContent.replace( '+', '-' ); }else{ link.innerText = link.innerText.replace( '+', '-' ); } }else{ ref.style.display = 'none'; if( link.textContent ){ link.textContent = link.textContent.replace( '-', '+' ); }else{ link.innerText = link.innerText.replace( '-', '+' ); } } }; XML 61 report.css IDEA: XBRL DOCUMENT /* Updated 2009-11-04 */ /* v2.2.0.24 */ /* DefRef Styles */ ..report table.authRefData{ background-color: #def; border: 2px solid #2F4497; font-size: 1em; position: absolute; } ..report table.authRefData a { display: block; font-weight: bold; } ..report table.authRefData p { margin-top: 0px; } ..report table.authRefData .hide { background-color: #2F4497; padding: 1px 3px 0px 0px; text-align: right; } ..report table.authRefData .hide a:hover { background-color: #2F4497; } ..report table.authRefData .body { height: 150px; overflow: auto; width: 400px; } ..report table.authRefData table{ font-size: 1em; } /* Report Styles */ ..pl a, .pl a:visited { color: black; text-decoration: none; } /* table */ ..report { background-color: white; border: 2px solid #acf; clear: both; color: black; font: normal 8pt Helvetica, Arial, san-serif; margin-bottom: 2em; } ..report hr { border: 1px solid #acf; } /* Top labels */ ..report th { background-color: #acf; color: black; font-weight: bold; text-align: center; } ..report th.void { background-color: transparent; color: #000000; font: bold 10pt Helvetica, Arial, san-serif; text-align: left; } ..report .pl { text-align: left; vertical-align: top; white-space: normal; width: 200px; white-space: normal; /* word-wrap: break-word; */ } ..report td.pl a.a { cursor: pointer; display: block; width: 200px; overflow: hidden; } ..report td.pl div.a { width: 200px; } ..report td.pl a:hover { background-color: #ffc; } /* Header rows... */ ..report tr.rh { background-color: #acf; color: black; font-weight: bold; } /* Calendars... */ ..report .rc { background-color: #f0f0f0; } /* Even rows... */ ..report .re, .report .reu { background-color: #def; } ..report .reu td { border-bottom: 1px solid black; } /* Odd rows... */ ..report .ro, .report .rou { background-color: white; } ..report .rou td { border-bottom: 1px solid black; } ..report .rou table td, .report .reu table td { border-bottom: 0px solid black; } /* styles for footnote marker */ ..report .fn { white-space: nowrap; } /* styles for numeric types */ ..report .num, .report .nump { text-align: right; white-space: nowrap; } ..report .nump { padding-left: 2em; } ..report .nump { padding: 0px 0.4em 0px 2em; } /* styles for text types */ ..report .text { text-align: left; white-space: normal; } ..report .text .big { margin-bottom: 1em; width: 17em; } ..report .text .more { display: none; } ..report .text .note { font-style: italic; font-weight: bold; } ..report .text .small { width: 10em; } ..report sup { font-style: italic; } ..report .outerFootnotes { font-size: 1em; } XML 63 FilingSummary.xml IDEA: XBRL DOCUMENT 3.10.0.1 html 87 232 1 false 30 0 false 4 false false R1.htm 00000001 - Document - Document and Entity Information Sheet http://heatbio.com/role/DocumentAndEntityInformation Document and Entity Information Cover 1 false false R2.htm 00000002 - Statement - Consolidated Balance Sheets Sheet http://heatbio.com/role/htbx-cbs Consolidated Balance Sheets Statements 2 false false R3.htm 00000003 - Statement - Consolidated Balance Sheets (Parenthetical) Sheet http://heatbio.com/role/BalanceSheetsParenthetical Consolidated Balance Sheets (Parenthetical) Statements 3 false false R4.htm 00000004 - Statement - Consolidated Statements of Operations and Comprehensive Loss (Unaudited) Sheet http://heatbio.com/role/StatementsOfOperationsAndComprehensiveLoss Consolidated Statements of Operations and Comprehensive Loss (Unaudited) Statements 4 false false R5.htm 00000005 - Statement - Consolidated Statements of Stockholders' Equity (Unaudited) Sheet http://heatbio.com/role/StatementsOfStockholdersEquity Consolidated Statements of Stockholders' Equity (Unaudited) Statements 5 false false R6.htm 00000006 - Statement - Consolidated Statements of Stockholders' Equity (Unaudited) (Parenthetical) Sheet http://heatbio.com/role/StatementsOfStockholdersEquityParenthetical Consolidated Statements of Stockholders' Equity (Unaudited) (Parenthetical) Statements 6 false false R7.htm 00000007 - Statement - Consolidated Statements of Cash Flows (Unaudited) Sheet http://heatbio.com/role/StatementsOfCashFlows Consolidated Statements of Cash Flows (Unaudited) Statements 7 false false R8.htm 00000008 - Disclosure - Basis of Presentation and Significant Accounting Policies Sheet http://heatbio.com/role/BasisOfPresentationAndSignificantAccountingPolicies Basis of Presentation and Significant Accounting Policies Notes 8 false false R9.htm 00000009 - Disclosure - Acquisition of Pelican Therapeutics Sheet http://heatbio.com/role/AcquisitionOfPelicanTherapeutics Acquisition of Pelican Therapeutics Notes 9 false false R10.htm 00000010 - Disclosure - Fair Value of Financial Instruments Sheet http://heatbio.com/role/FairValueOfFinancialInstruments Fair Value of Financial Instruments Notes 10 false false R11.htm 00000011 - Disclosure - Prepaid Expenses and Other Current Assets Sheet http://heatbio.com/role/PrepaidExpensesAndOtherCurrentAssets Prepaid Expenses and Other Current Assets Notes 11 false false R12.htm 00000012 - Disclosure - Property and Equipment Sheet http://heatbio.com/role/PropertyAndEquipment Property and Equipment Notes 12 false false R13.htm 00000013 - Disclosure - Goodwill and In-process R&D Sheet http://heatbio.com/role/GoodwillAndIn-processRd Goodwill and In-process R&D Notes 13 false false R14.htm 00000014 - Disclosure - Accrued Expenses and other payables Sheet http://heatbio.com/role/AccruedExpensesAndOtherPayables Accrued Expenses and other payables Notes 14 false false R15.htm 00000015 - Disclosure - Stock-Based Compensation Sheet http://heatbio.com/role/Stock-basedCompensation Stock-Based Compensation Notes 15 false false R16.htm 00000016 - Disclosure - Financing Sheet http://heatbio.com/role/Financing Financing Notes 16 false false R17.htm 00000017 - Disclosure - Grant and Licensing Revenues Sheet http://heatbio.com/role/GrantAndLicensingRevenues Grant and Licensing Revenues Notes 17 false false R18.htm 00000018 - Disclosure - Net Loss Per Share Sheet http://heatbio.com/role/NetLossPerShare Net Loss Per Share Notes 18 false false R19.htm 00000019 - Disclosure - Income Tax Sheet http://heatbio.com/role/IncomeTax Income Tax Notes 19 false false R20.htm 00000020 - Disclosure - Subsequent Events Sheet http://heatbio.com/role/SubsequentEvents Subsequent Events Notes 20 false false R21.htm 00000021 - Disclosure - Basis of Presentation and Significant Accounting Policies (Policies) Sheet http://heatbio.com/role/BasisOfPresentationAndSignificantAccountingPoliciesPolicies Basis of Presentation and Significant Accounting Policies (Policies) Policies http://heatbio.com/role/BasisOfPresentationAndSignificantAccountingPolicies 21 false false R22.htm 00000022 - Disclosure - Acquisition of Pelican Therapeutics (Tables) Sheet http://heatbio.com/role/AcquisitionOfPelicanTherapeuticsTables Acquisition of Pelican Therapeutics (Tables) Tables http://heatbio.com/role/AcquisitionOfPelicanTherapeutics 22 false false R23.htm 00000023 - Disclosure - Fair Value of Financial Instruments (Tables) Sheet http://heatbio.com/role/FairValueOfFinancialInstrumentsTables Fair Value of Financial Instruments (Tables) Tables http://heatbio.com/role/FairValueOfFinancialInstruments 23 false false R24.htm 00000024 - Disclosure - Prepaid Expenses and Other Current Assets (Tables) Sheet http://heatbio.com/role/PrepaidExpensesAndOtherCurrentAssetsTables Prepaid Expenses and Other Current Assets (Tables) Tables http://heatbio.com/role/PrepaidExpensesAndOtherCurrentAssets 24 false false R25.htm 00000025 - Disclosure - Property and Equipment (Tables) Sheet http://heatbio.com/role/PropertyAndEquipmentTables Property and Equipment (Tables) Tables http://heatbio.com/role/PropertyAndEquipment 25 false false R26.htm 00000027 - Disclosure - Accrued Expenses and other payables (Tables) Sheet http://heatbio.com/role/AccruedExpensesAndOtherPayablesTables Accrued Expenses and other payables (Tables) Tables http://heatbio.com/role/AccruedExpensesAndOtherPayables 26 false false R27.htm 00000028 - Disclosure - Stock-Based Compensation (Tables) Sheet http://heatbio.com/role/Stock-basedCompensationTables Stock-Based Compensation (Tables) Tables http://heatbio.com/role/Stock-basedCompensation 27 false false R28.htm 00000029 - Disclosure - Net Loss Per Share (Tables) Sheet http://heatbio.com/role/NetLossPerShareTables Net Loss Per Share (Tables) Tables http://heatbio.com/role/NetLossPerShare 28 false false R29.htm 00000030 - Disclosure - Basis of Presentation and Significant Accounting Policies (Details) Sheet http://heatbio.com/role/BasisOfPresentationAndSignificantAccountingPoliciesDetails Basis of Presentation and Significant Accounting Policies (Details) Details http://heatbio.com/role/BasisOfPresentationAndSignificantAccountingPoliciesPolicies 29 false false R30.htm 00000031 - Disclosure - Acquisition of Pelican Therapeutics (Narrative) (Details) Sheet http://heatbio.com/role/AcquisitionOfPelicanTherapeuticsNarrativeDetails Acquisition of Pelican Therapeutics (Narrative) (Details) Details http://heatbio.com/role/AcquisitionOfPelicanTherapeuticsTables 30 false false R31.htm 00000032 - Disclosure - Acquisition of Pelican Therapeutics (Future Milestone Payments) (Details) Sheet http://heatbio.com/role/AcquisitionOfPelicanTherapeuticsFutureMilestonePaymentsDetails Acquisition of Pelican Therapeutics (Future Milestone Payments) (Details) Details http://heatbio.com/role/AcquisitionOfPelicanTherapeuticsTables 31 false false R32.htm 00000033 - Disclosure - Acquisition of Pelican Therapeutics (Schedule of Purchase Price of Assets and Liabilities) (Details) Sheet http://heatbio.com/role/AcquisitionOfPelicanTherapeuticsScheduleOfPurchasePriceOfAssetsAndLiabilitiesDetails Acquisition of Pelican Therapeutics (Schedule of Purchase Price of Assets and Liabilities) (Details) Details http://heatbio.com/role/AcquisitionOfPelicanTherapeuticsTables 32 false false R33.htm 00000034 - Disclosure - Acquisition of Pelican Therapeutics (Schedule of Pro Forma Financial Information for Acquisition) (Details) Sheet http://heatbio.com/role/AcquisitionOfPelicanTherapeuticsScheduleOfProFormaFinancialInformationForAcquisitionDetails Acquisition of Pelican Therapeutics (Schedule of Pro Forma Financial Information for Acquisition) (Details) Details http://heatbio.com/role/AcquisitionOfPelicanTherapeuticsTables 33 false false R34.htm 00000035 - Disclosure - Fair Value of Financial Instruments (Schedule of Fair Value Measurements) (Details) Sheet http://heatbio.com/role/FairValueOfFinancialInstrumentsScheduleOfFairValueMeasurementsDetails Fair Value of Financial Instruments (Schedule of Fair Value Measurements) (Details) Details http://heatbio.com/role/FairValueOfFinancialInstrumentsTables 34 false false R35.htm 00000036 - Disclosure - Fair Value of Financial Instruments (Schedule of Inputs and Valuation Methodologies Used) (Details) Sheet http://heatbio.com/role/FairValueOfFinancialInstrumentsScheduleOfInputsAndValuationMethodologiesUsedDetails Fair Value of Financial Instruments (Schedule of Inputs and Valuation Methodologies Used) (Details) Details http://heatbio.com/role/FairValueOfFinancialInstrumentsTables 35 false false R36.htm 00000037 - Disclosure - Prepaid Expenses and Other Current Assets (Schedule of Prepaid Expenses and Other Current Assets) (Details) Sheet http://heatbio.com/role/PrepaidExpensesAndOtherCurrentAssetsScheduleOfPrepaidExpensesAndOtherCurrentAssetsDetails Prepaid Expenses and Other Current Assets (Schedule of Prepaid Expenses and Other Current Assets) (Details) Details http://heatbio.com/role/PrepaidExpensesAndOtherCurrentAssetsTables 36 false false R37.htm 00000038 - Disclosure - Property and Equipment (Details) Sheet http://heatbio.com/role/PropertyAndEquipmentDetails Property and Equipment (Details) Details http://heatbio.com/role/PropertyAndEquipmentTables 37 false false R38.htm 00000039 - Disclosure - Accrued Expenses and other payables (Schedule of Accrued Expenses) (Details) Sheet http://heatbio.com/role/AccruedExpensesAndOtherPayablesScheduleOfAccruedExpensesDetails Accrued Expenses and other payables (Schedule of Accrued Expenses) (Details) Details http://heatbio.com/role/AccruedExpensesAndOtherPayablesTables 38 false false R39.htm 00000040 - Disclosure - Stock-Based Compensation (Narrative) (Details) Sheet http://heatbio.com/role/Stock-basedCompensationNarrativeDetails Stock-Based Compensation (Narrative) (Details) Details http://heatbio.com/role/Stock-basedCompensationTables 39 false false R40.htm 00000041 - Disclosure - Stock-Based Compensation (Schedule of Stock Option Activity) (Details) Sheet http://heatbio.com/role/Stock-basedCompensationScheduleOfStockOptionActivityDetails Stock-Based Compensation (Schedule of Stock Option Activity) (Details) Details http://heatbio.com/role/Stock-basedCompensationTables 40 false false R41.htm 00000042 - Disclosure - Stock-Based Compensation (Schedule of Stock Option Valuation Assumptions) (Details) Sheet http://heatbio.com/role/Stock-basedCompensationScheduleOfStockOptionValuationAssumptionsDetails Stock-Based Compensation (Schedule of Stock Option Valuation Assumptions) (Details) Details http://heatbio.com/role/Stock-basedCompensationTables 41 false false R42.htm 00000043 - Disclosure - Stock-Based Compensation (Summary of Outstandng Stock Options) (Details) Sheet http://heatbio.com/role/Stock-basedCompensationSummaryOfOutstandngStockOptionsDetails Stock-Based Compensation (Summary of Outstandng Stock Options) (Details) Details http://heatbio.com/role/Stock-basedCompensationTables 42 false false R43.htm 00000044 - Disclosure - Financing (Details) Sheet http://heatbio.com/role/FinancingDetails Financing (Details) Details http://heatbio.com/role/Financing 43 false false R44.htm 00000045 - Disclosure - Grant and Licensing Revenues (Details) Sheet http://heatbio.com/role/GrantAndLicensingRevenuesDetails Grant and Licensing Revenues (Details) Details http://heatbio.com/role/GrantAndLicensingRevenues 44 false false R45.htm 00000046 - Disclosure - Net Loss Per Share (Schedule of Reconciliation of Net Loss to Net Loss Attributable to Heat Biologics, Inc.) (Details) Sheet http://heatbio.com/role/NetLossPerShareScheduleOfReconciliationOfNetLossToNetLossAttributableToHeatBiologicsInc.Details Net Loss Per Share (Schedule of Reconciliation of Net Loss to Net Loss Attributable to Heat Biologics, Inc.) (Details) Details http://heatbio.com/role/NetLossPerShareTables 45 false false R46.htm 00000047 - Disclosure - Net Loss Per Share (Schedule of Antidilutive Securities) (Details) Sheet http://heatbio.com/role/NetLossPerShareScheduleOfAntidilutiveSecuritiesDetails Net Loss Per Share (Schedule of Antidilutive Securities) (Details) Details http://heatbio.com/role/NetLossPerShareTables 46 false false R47.htm 00000048 - Disclosure - Income Tax (Narrative) (Details) Sheet http://heatbio.com/role/IncomeTaxNarrativeDetails Income Tax (Narrative) (Details) Details http://heatbio.com/role/IncomeTax 47 false false All Reports Book All Reports htbx-20180630.xml htbx-20180630.xsd htbx-20180630_cal.xml htbx-20180630_def.xml htbx-20180630_lab.xml htbx-20180630_pre.xml http://fasb.org/srt/2018-01-31 http://xbrl.sec.gov/dei/2018-01-31 http://fasb.org/us-gaap/2018-01-31 http://xbrl.sec.gov/invest/2013-01-31 true true ZIP 65 0001553350-18-000935-xbrl.zip IDEA: XBRL DOCUMENT begin 644 0001553350-18-000935-xbrl.zip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

REIC+2]-CG^B+,_?>L?Z%+_@XPR991QE1DJ;07R?Y M5%V-,K-T?3ZC+=/\:W.-/ '^Z85D_MEB?8LLXL.P-!->^"D9EJ?'MT?W,:&5 M[R,3'PC #P<_W1B']919L05F6^)TT#FFI75%:\GICQ.MI; SSJDM#AL@TOI&GU/B=W7&)!=7.Q-QL? M[RUU^K1+1Y4XG6$RI\3ISDG^B*.K&H T[5\0VFGGCG7G*C.MOHH(!T;;A+L-M*&[_7.NR8K VLDOFP68D^%N9W1QRRL#HMRKZO MX]+2F=@#) U.@&$,1DI]OG?:K;WNUDA7!WJ#J]UC8$D=*'X?R8)@=5#).UA^ M]=YMHAZ&T?1/_!L#>=3@IOM$$'V$M@%!J).!WDT1\*.RO>ORV6M0 9U 6I & M)G0/3TX/CT>'9T [?$>=TPYWNL/Z@7>X7\RNL[Z0<<#"2<'HX?DZC()AJ .M MR='KMO#.B60.2C+T"GAA+BU[_4ZZM9;$']#_EKZ2)^F[NS2=0D-FW%^ZZA>W M/]U];Y/I](><>(X6@M2[OT'H? F-+AIT?30PQ@ULRS:R,O9VTW0BIV[]% -U M,A[HVB&S-+IV%N?U(FLW2CL; RY>:F%:Q')ENVM"/K K+%5R?Z4"L;-&X,U0[>+ HN;P3J9#C]P=J"&1T6(=A/B+/:08CSS8/I;63N M=.!D3Q-\I_'F_8=P7[W$=B^H*KG\C?)J$$;E5(A&YGKVK-FI/L#EV'P/NN0WRU!?O5,$.KS[A3EWM5O[R%(C0[)1!MHVK@OED[_ M+)M]0-31!=YA*$H;3NMSW:-BK0?3VR]=;T&L)GSW1]%UCPO:)L?NC3(:C-5# M9-CMYJCT88,RSB]$#V_NQ3J I.BTU543,:,.C4.D%?9+!.W1/Y2Z<7M)"G_G MD0@OL7%;0;,-8^]Z*.1L'])U@+A=^Y9.B@=*^IPTIB* M&Q5RW9,LVE;(M: MI3*5:2#_0 #ON=(1\X#N:#Z6ZTB_#V^&TJU'3#_TUNGW?,D,J(,CL)8DRA=B M3I>G!]>'WXFWQ,%XFPK:^R1RL)"$%2Q(7K*1SSQ F!)F.FLI]&DOE=@+\P # MNAXM9\N^0D<.$73N9 GXE6/::X !)_+(RO6HB\8,3.K!,:45(9Z$Q+/"-V8X MI\=\*71Z"]8:/,!J'V!Z6)&/Y733?A^Z,#^\PXN9P#)M>RWYUM*R38^BP:<= M9P)A07,+^\+P(?UPL;!F%F(H\$PD,[Y EFIE!8C$Y1(60V<=2C$GI3CVL+62 M#U^S*5;$L]PY@UB8DM.K/G[OI[UH=,]@-SUA6P)7NH-]26Z:TMM![/BU$/'] M+T)GBJ:8O(?%KV!K+3*/?C. "$GPX-*/(J==FA9P,4/I=Q ;F%Z&Z6BKE>>: MLXQ1YP9'7.(-ZS@B3]B4J-GSH(0 MBR/C _XRP\^PX5%K\=3&VSY/>7JH'Y2>,L!MX'M9^ACV65I@2BI/,74/-XK)=.KOCM A=&FB39M9OBC@R = D+)X<=P[X!T9'BEP$Q0=O]5-#TY7_8>PKY3_(J7+23,]::8O",*39GK23%^N7C?, M27TANW!4P!Z8Q2AC9:"/#]&FLU_;<%3 'IAF)L-#)#/T:PN."MA#BR55'\JM MIJ.5WH6*UDI=ZZ0_$??X?OE^(N\"#ML>C@:H:?+':>*#*DP:+[3.B:@:9-UA14>R^(:L,X0W&5N3! M""1S0WQC)Y,4OAN,5\SJ,4,);SII11[:/(4E/F6V#-YT7.*0&T3)B%LXZ@#0/K-#F@.SN7PG5SL;*>I 47GJD2ZK TV?-DWE25:6 MM!FLT@@PVT20*CT/K@W6C/_IGZ$5K+^Z 4F:$#;L(-B=!C<=2I>6 V=J\R)Y MSZI:VRKI=7AG6S/IVV)!O&AQ=372MM;TS9&^F&MI(EHTD<1&2F%)OB%F@#YY M5A 01UJQ9;A\&=*;=*)IO+PXS91R-F[&!%&V+CU:0)[ "7^2]($Q&5&FG_!0 M,;\6&,\]H9 M&OC& BBF^"J%8@6B8Q'2TQL-/&!3TY)WFX^!F\1Y Y038"HEG32[E$'-M:!H ME3,HVDQ#1H4KNS\L$9N9E4-=1ZNP"#1\0:,OY"R1Z8/Q>%( #9W@CI!DBCE+A73,-I2O,3W4<%$>XJ5%1@!BAXN#46P4C6@[,*C('FD9Z M#YKG$O/F,VSA=_&M\^@M@4D,*.;GE!VI4?5)!.1\^.OP>OCV'%9-]^-7V[T# M7%R;7N" <)/>L!=^HAG]<>:]B8(URAN/083W&4WD@T-EH6D!>1AR@V$'N%R"Q,LDM M K>$(^H3X"\+4!=9M1%D0/"_ \PC1['$].7!5L$+%,-KR:)8D655$$VQ-@U0 M4:FPPBE>:X/QR*!2,&5O%1352+%:*C!0VP&!*BDCSF$B;03)E*KC(6 B7*UL MAMI-%FS> ][OF8Q("=@$2&6@,3UBR+7%J#NJSL4&A5JVIFJ@N6B_ 1RST:I$'%Z M6E9&./8L%Y(;HQ>QW!5)Z.;310[[_NH^TO:(DJ*QKHBY C%%3E0-1"P+J)64 M@2YK PT$9@'J$OX&M+QQ)K#NB$V9.^B>*;UDPQO^6AOJD5#=9%&'=0.G>5B* M"_R-"_2J+*Q# ZE BQ ,C*QRFF9Z_#!NU<,I94X&BL$4^P+=#K7TV!'!ZNB4 MU,^Y#IVK.,T+5,!8*68C4J4@A^8K:63%BFMY791"LJGG,J[]0!(5%X]N>XHK M S[G#7-&E?E(M85]HHX).*+ RT*J0N65&0\*4;%YEB>"@LRK+6TH].DBY47U MR+\0+X!!>!UR2DBTYE6Z&KGEK,+ ?Q=7*1HQ' ]H+2^)UO+R^/SJ<&+\98!5 M@-+%@@9BD2SD?*H^5/2_,.62[:.XPYHL;'!<4XMZ?7FEJOCM$F)Q.\/KG#&@ M+%:YH-@P7'-80ZYI/#;4C)&?IA9J9N>?%]0[!'32"EWE#TS!LG)0_A\A$"=? MJ 9$8V%)LE+,4%QQUI2AQTC9NG@*,3(]6-AK11VEUQNN7 $O%5?_+5:F&+-0 M=L(?[UBAEP>KC'GSV):PG+A*%5-U>'4XSWK$0\79QPK.+9/Z< (@X)YO%/WJ$^G>2Q M>$T!AF44?@#(9GJ@>!OX8*;+3Q7XO!1-'1B:5HZZT\(/%CH=#Y31M-S':4[P M/A^@!F?M/<5>_JB40,L,FJ8_BE%?H-RY2XO%+0EADF]&V81E LW#24D*O