The Company’s Amended and Restated Certificate of Incorporation authorizes the Company to issue 210,000,000 shares of common and preferred stock, consisting of 200,000,000 shares of common stock with $0.01 par value and 10,000,000 shares of preferred stock with $0.01 par value. As of June 30, 2023 and December 31, 2022, the Company had no preferred stock issued or outstanding.

In October 2022, the Company completed a follow-on public offering of 1,778,500 shares of common stock and pre-funded warrants to purchase up to 2,221,499 shares of common stock and warrants to purchase 3,999,999 shares of common stock, at an offering price of $3.80 per share of common stock and warrant and $3.70 per pre-funded warrant and warrant, before underwriting discounts and commissions. Net proceeds were approximately $14.1 million, after deducting underwriting discounts, debt issuance cost, commissions and estimated expenses payable by the Company. As of June 30, 2023 and December 31, 2022, there were 4,657,799 warrants outstanding related to the follow-on public offering.

In October 2022, the Company entered into an Exchange Agreement with Deerfield, in connection with the Restated Agreement, pursuant to which Deerfield exchanged $10.0 million of principal under the Original Note for 296,774 shares of our common stock and a pre-funded warrant to purchase 1,054,395 shares of our common stock (the

"Exchange Warrants"), reducing the outstanding principal amount of the Original Note to $50.0 million. The Exchange Warrants are immediately exercisable, have an exercise price of $0.001 per share, and may be exercised on a cash or cashless basis at any time until all of the Exchange Warrants are exercised in full. Under the terms of the Exchange Warrants, a holder will not be entitled to exercise any portion of any such warrant, if, upon giving effect to such exercise, the aggregate number of shares of Common Stock beneficially owned by the holder (together with its affiliates, any other persons acting as a group together with the holder or any of the holder’s affiliates, and any other persons whose beneficial ownership of Common Stock would or could be aggregated with the holder’s for purposes of Section 13(d) or Section 16 of the Securities Exchange Act of 1934, as amended) would exceed 4.985% of the number of shares of Common Stock outstanding immediately after giving effect to the exercise.

The Exchange Agreement contains customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification obligations of the Company, other obligations of the parties, and termination provisions.

As of June 30, 2023 and December 31, 2022, there were 0 and 303,804 warrants outstanding, respectively, related to Exchange Agreement.

In April 2007, the Company adopted the 2007 Equity Incentive Plan, or 2007 Plan. The 2007 Plan provides for the granting of stock options to employees, directors and consultants of the Company. A total of 169,045 shares of the Company’s common stock were reserved for issuance under the 2007 Plan.

The Company’s board of directors adopted the 2014 Equity Incentive Plan, or 2014 Plan, in July 2014, and the stockholders approved the 2014 Plan in October 2014. The 2014 Plan became effective upon completion of the IPO on November 3, 2014, at which time the Company ceased granting awards under the 2007 Plan. A total of 102,750 shares of common stock were initially reserved for issuance under the 2014 Plan, subject to certain annual increases.

Pursuant to a board-approved Inducement Plan, the Company may issue NSOs and restricted stock unit awards which may only be granted to new employees of the Company and their affiliates in accordance with NASDAQ Stock Market Rule 5635(c)(4) as an inducement material to such individuals entering into employment with the Company.

As of June 30, 2023, a total of 314,016 shares of the Company’s common stock were available for issuance under the 2014 Plan. As of June 30, 2023, inducement grants for 528,221 shares of common stock have been awarded, and 303,496 shares of common stock were reserved for future issuance under the Inducement Plan.

On June 22, 2023, the Company registered an additional 511,128 shares of the Registrant’s common stock to be issued pursuant to the Registrant’s 2016 Equity Inducement Plan.

On April 17, 2023, the Company registered an additional 428,098 shares of the Registrant’s common stock to be issued pursuant to the Registrant’s 2014 Equity Incentive Plan.

Options under the 2007 Plan and the 2014 Plan may be granted for periods of up to ten years as determined by the Company’s board of directors, provided, however, that (i) the exercise price of an ISO shall not be less than 100% of the estimated fair value of the shares on the date of grant, and (ii) the exercise price of an ISO granted to a more than 10% shareholder shall not be less than 110% of the estimated fair value of the shares on the date of grant. An NSO has no such exercise price limitations. NSOs under the Inducement Plan may be granted for periods of up to ten years as determined by the board of directors, provided, the exercise price will be not less than 100% of the estimated fair value of the shares on the date of grant. Options generally vest with 25% of the grant vesting on the first anniversary and the balance vesting monthly on a straight-lined basis over the requisite service period of three additional years for the award. Compensation expense is recognized on a straight-lined basis over the vesting term of one year based upon the probable performance target that will be met. The vesting provisions of individual options may vary but provide for vesting of at least 25% per year.

The following summarizes all option activity under the 2007 Plan, 2014 Plan and Inducement Plan:


				Weighted		Weighted average
				average		remaining
	Option			exercise		contractual
	Shares			price		term (year)
Balance at December 31, 2022		89,678		$	42.78		7.11
Forfeited		(2,619	)		139.79
Balance at June 30, 2023		87,059		$	39.86		6.78

For stock-based awards the Company recognizes compensation expense based on the grant date fair value using the Black-Scholes option valuation model. Stock-based compensation expense related to stock options for both the three months ended June 30, 2023 and 2022 was $0.2 million. Stock-based compensation expense related to stock options for both the six months ended June 30, 2023 and 2022 was $0.3 million.

The Company has issued restricted stock unit awards, or RSUs, under the 2014 Plan and the Inducement Plan. The RSUs issued to employees generally vest on a straight-line basis annually over a 3-year requisite service period. RSUs issued to non-employees generally vest either monthly or annually over the service term.

Activity related to RSUs is set forth below:


				Weighted average
	Number			grant date
	of shares			fair value
Balance at December 31, 2022		708,806		$	43.86
Granted		574,200			1.71
Vested		(147,924	)		24.91
Forfeited		(61,626	)		12.05
Balance at June 30, 2023		1,073,456		$	25.75

Stock-based compensation expense for RSUs for the three months ended June 30, 2023 and 2022 was $1.1 million and $1.8 million, respectively. Stock-based compensation expense for RSUs for the six months ended June 30, 2023 and 2022 was $2.5 million and $3.7 million, respectively. As of June 30, 2023, there was $5.7 million of total unrecognized compensation costs related to non-vested RSU awards. The cost is expected to be recognized over a weighted average period of approximately 1.49 years.

The Company’s board of directors adopted the 2014 Employee Stock Purchase Plan, or ESPP, in July 2014, and the stockholders approved the ESPP in October 2014. The ESPP allows eligible employees to purchase shares of the Company’s common stock at a discount through payroll deductions of up to 15% of their eligible compensation, subject to any plan limitations. The ESPP provides for offering periods not to exceed 27 months, and each offering period will include purchase periods, which will be the approximately six-month period commencing with one exercise date and ending with the next exercise date. Employees are able to purchase shares at 85% of the lower of the fair market value of the Company’s common stock on the first trading day of the offering period or on the purchase date. A total of 255,500 shares of common stock were initially reserved for issuance under the ESPP, subject to certain annual increases.

During the six months ended June 30, 2023, employees purchased 144,447 shares of common stock at a weighted average price of $1.75 per share. As of June 30, 2023, the number of shares of common stock available for future

issuance for the ESPP was 115,837. On April 17, 2023, the Company registered an additional 107,024 shares of the Registrant’s common stock to be issued pursuant to the Registrant’s 2014 Employee Stock Purchase Plan.

The Company estimated the fair value of employee stock purchase rights using the Black-Scholes model. Stock-based compensation expense related to the ESPP for the three months ended June 30, 2023 and 2022 was $0.1 million and $0.2, respectively. Stock-based compensation expense related to the ESPP was $0.3 million for both the six months ended June 30, 2023 and 2022.