UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, ~~2017~~2019

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 001-33133

YIELD10 BIOSCIENCE, INC.



Delaware		04-3158289
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

19 Presidential Way Woburn, MA		01801
(Address of principal executive offices)		(Zip Code)

(617) 583-1700

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report.)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	YTEN	The Nasdaq Capital Market

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 ý 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 ý 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. ~~(Check one):~~



Large accelerated filero	o	Accelerated filer	o

Non-accelerated filero ~~(Do not check if a smaller reporting company)~~	ý	Smaller reporting companyx	ý
Emerging growth company	o

If an emerging growth company, indicate by check mark if the registrant 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. o

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

The number of shares outstanding of the registrant’s common stock as of November ~~6, 2017~~7, 2019 was ~~3,461,714.~~12,567,582.

Yield10 Bioscience, Inc.

Form 10-Q

For the Quarter Ended September 30, ~~2017~~2019

Table of Contents


		Page		Page
Part I. Financial Information	Part I. Financial Information	2	Part I. Financial Information	3

Item
1.	Condensed Consolidated Financial Statements (Unaudited)	3	Condensed Consolidated Financial Statements (unaudited)	3
			Condensed Consolidated Balance Sheets at September 30, 2019 and December 31, 2018	3
	Condensed Consolidated Balance Sheets at September 30, 2017 and December 31, 2016	3	Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2019 and 2018	4
	Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2017 and 2016	4	Condensed Consolidated Statements of Comprehensive Loss for the three and nine months ended September 30, 2019 and 2018	5
	Condensed Consolidated Statements of Comprehensive Loss for the three and nine months ended September 30, 2017 and 2016	5	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2019 and 2018	6
	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2017 and 2016	6	Condensed Consolidated Statements of Stockholders' Equity for the three and nine months ended September 30, 2019 and 2018	7
	Notes to the Condensed Consolidated Financial Statements	7	Notes to the Condensed Consolidated Financial Statements	9
2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
3.	Quantitative and Qualitative Disclosures About Market Risk	26	Quantitative and Qualitative Disclosures About Market Risk	27
4.	Controls and Procedures	26	Controls and Procedures	27

Part II. Other Information	Part II. Other Information	28	Part II. Other Information	28

Item
1.	Legal Proceedings	28	Legal Proceedings	28
1A.	Risk Factors	28	Risk Factors	28
2.	Unregistered Sales of Equity Securities and Use of Proceeds	28	Unregistered Sales of Equity Securities and Use of Proceeds	28
3.	Defaults Upon Senior Securities	28	Defaults Upon Senior Securities	29
4.	Mine Safety Disclosures	29	Mine Safety Disclosures	29
5.	Other Information	29	Other Information	29
6.	Exhibits	29	Exhibits	29

SIGNATURES	SIGNATURES	30	SIGNATURES	30

PART I. FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

YIELD10 BIOSCIENCE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

UNAUDITED

(in thousands, except share and per share data)


	September 30, 2017			December 31, 2016			September 30, 2019			December 31, 2018
Assets
Current Assets:
Cash and cash equivalents	$	2,951		$	7,309		$	2,877		$	3,023
Short-term investments							—			2,746
Accounts receivable	135			66			71			94
Due from related party	—			1
Unbilled receivables	102			121			83			66
Prepaid expenses and other current assets	296			363			468			448
Total current assets	3,484			7,860			3,499			6,377
Restricted cash	432			432			332			332
Property and equipment, net	1,587			1,739			1,247			1,385
Deferred equity financing costs	—			622
Right-of-use assets							4,310			4,766
Other assets	69			95			31			100
Total assets	$	5,572		$	10,748		$	9,419		$	12,960

Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	48		$	56		$	51		$	117
Accrued expenses	1,938			2,702			905			680
Lease liabilities							798			844
Total current liabilities	1,986			2,758			1,754			1,641
Lease incentive obligation, net of current portion	1,037			1,132
Contract termination obligation, net of current portion	—			489
Lease liabilities, net of current portion							5,045			5,621
Total liabilities	3,023			4,379			6,799			7,262

Commitments and contingencies (Note 8)
Commitments and contingencies (Note 9)

Stockholders’ Equity:
Preferred stock ($0.01 par value per share); 5,000,000 shares authorized; no shares issued or outstanding	—			—			—			—
Common stock ($0.01 par value per share); 250,000,000 shares authorized at September 30, 2017 and December 31, 2016; 3,454,601 and 2,834,244 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively	35			28
Common stock ($0.01 par value per share); 60,000,000 shares authorized at September 30, 2019 and December 31, 2018; 12,519,017 and 10,025,811 shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively							125			100
Additional paid-in capital	342,796			339,782			360,670			357,646
Accumulated other comprehensive loss	(81		)	(84		)	(124		)	(110		)
Accumulated deficit	(340,201		)	(333,357		)	(358,051		)	(351,938		)
Total stockholders’ equity	2,549			6,369			2,620			5,698
Total liabilities and stockholders’ equity	$	5,572		$	10,748		$	9,419		$	12,960

The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements

YIELD10 BIOSCIENCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

UNAUDITED

(in thousands, except share and per share data)

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Revenue:
Grant revenue $ 223
$ 473
$ 840
$ 818
Total revenue 223
473
840

818

Expenses:
Research and development 1,132
1,547
3,379
4,522
General and administrative 1,073
1,530
4,215
4,951
Total expenses 2,205
3,077
7,594

9,473
Loss from continuing operations (1,982 ) (2,604 ) (6,754 )
(8,655 )
Other expense, net (43 ) (8 ) (90 ) (4 )
Net loss from continuing operations before income tax benefit (2,025 ) (2,612 ) (6,844 ) (8,659 )
Income tax benefit —
1,042
—
1,042
Net loss from continuing operations (2,025 ) (1,570 ) (6,844 )
(7,617 )

Discontinued operations:
Income from discontinued operations —
6,853
—
3,204
Income tax expense —
(1,259 ) —
(1,259 )
Total loss from discontinued operations —
5,594
—

1,945

Net (loss) income $ (2,025 ) $ 4,024
$ (6,844 )
$ (5,672 )

Basic and diluted net income (loss) per share:
Net loss from continuing operations $ (0.59 ) $ (0.56 ) $ (2.25 ) $ (2.75 )
Net income from discontinued operations —
2.00
—
0.70
Net income (loss) per share $ (0.59 ) $ 1.44
$ (2.25 ) $ (2.05 )

Number of shares used in per share calculations:
Basic & Diluted 3,410,847
2,786,900
3,035,352
2,765,200



	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Revenue:
Grant revenue	$	224		$	76		$	666		$	421
Total revenue	224			76			666			421

Expenses:
Research and development	1,232			1,335			3,646			3,696
General and administrative	990			1,417			3,201			4,149
Total expenses	2,222			2,752			6,847			7,845
Loss from operations	(1,998		)	(2,676		)	(6,181		)	(7,424		)

Other income (expense), net	16			38			68			101
Net loss	$	(1,982	)	$	(2,638	)	$	(6,113	)	$	(7,323	)

Basic and diluted net loss per share	$	(0.16	)	$	(0.26	)	$	(0.52	)	$	(0.74	)

Number of shares used in per share calculations:
Basic and diluted	12,518,753			10,010,762			11,846,176			9,901,459

The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements

YIELD10 BIOSCIENCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE ~~INCOME (LOSS)~~LOSS

UNAUDITED

(in thousands)


	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016			2019			2018			2019			2018
Net income (loss):	$	(2,025	)	$	4,024		$	(6,844	)	$	(5,672	)
Net loss:													$	(1,982	)	$	(2,638	)	$	(6,113	)	$	(7,323	)
Other comprehensive loss
Change in unrealized gain (loss) on investments													—			(1		)	—			(1		)
Change in foreign currency translation adjustment	3			(3		)	3			(9		)	(6		)	(5		)	(14		)	(19		)
Total other comprehensive loss	3			(3		)	3			(9		)	(6		)	(6		)	(14		)	(20		)
Comprehensive income (loss)	$	(2,022	)	$	4,021		$	(6,841	)	$	(5,681	)
Comprehensive loss													$	(1,988	)	$	(2,644	)	$	(6,127	)	$	(7,343	)

The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements

YIELD10 BIOSCIENCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

UNAUDITED

(in thousands)

Nine Months Ended
September 30,
2017 2016
Cash flows from operating activities
Net loss $ (6,844 ) $ (5,672 )
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation 158
458
Charge for 401(k) company common stock match 68
259
Stock-based compensation 1,063
1,155
Inventory impairment —
199
Non-cash income tax expense —
217
Gain on sale of discontinued operation and property and equipment —
(9,833 )
Non-cash restructuring expense paid through stock and equipment —
196
Changes in operating assets and liabilities:
Accounts receivables (69 ) 40
Due from related party 1
145
Unbilled receivables 19
(197 )
Inventory —
180
Prepaid expenses and other assets 715
1,413
Accounts payable (8 ) 122
Accrued expenses (828 ) (1,047 )
Contract termination obligation and other long-term liabilities (584 ) 655
Deferred revenue —
(277 )
Net cash (used for) provided by operating activities (6,309 ) (11,987 )

Cash flows from investing activities
Purchase of property and equipment (6 ) (721 )
Proceeds from sale of discontinued operation and property and equipment —
10,317
Change in restricted cash —
187
Net cash used for investing activities (6 ) 9,783

Cash flows from financing activities
Taxes paid related to net share settlement upon vesting of stock awards (12 ) (274 )
Proceeds from registered direct offering 1,966
—
Net cash provided by (used for) financing activities 1,954
(274 )

Effect of exchange rate changes on cash and cash equivalents 3
(9 )

Net decrease in cash and cash equivalents (4,358 ) (2,487 )
Cash and cash equivalents at beginning of period 7,309
12,269
Cash and cash equivalents at end of period $ 2,951
$ 9,782
Supplemental disclosure of non-cash information:

Lease incentive paid by lessor $ —
$ 1,332
Write-off of deferred financing costs related to Aspire stock purchase agreement $ (450 ) $ —
Transfer of equipment to settle contractual liability $ —
$ 111
Issuance of common stock to settle contractual liability $ —
$ 85



	Nine Months Ended September 30,
	2019			2018
Cash flows from operating activities
Net loss	$	(6,113	)	$	(7,323	)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation	150			146
Charge for 401(k) company common stock match	73			91
Stock-based compensation	406			952
Non-cash lease expense	456			431
Changes in operating assets and liabilities:
Accounts receivables	23			29
Unbilled receivables	(17		)	36
Prepaid expenses and other assets	217			(70		)
Accounts payable	(66		)	(37		)
Accrued expenses	48			(756		)
Lease liabilities	(622		)	(230		)
Net cash used for operating activities	(5,445		)	(6,731		)

Cash flows from investing activities
Purchase of property and equipment	(12		)	(42		)
Purchase of short-term investments	(1,000		)	(9,742		)
Proceeds from the sale and maturity of short-term investments	3,746			5,250
Net cash provided by (used for) investing activities	2,734			(4,534		)

Cash flows from financing activities
Proceeds from warrants exercised	—			124
Taxes paid on employees' behalf related to vesting of stock awards	(4		)	(6		)
Proceeds from registered direct offering, net of issuance costs	2,583			—
Net cash provided by financing activities	2,579			118

Effect of exchange rate changes on cash, cash equivalents and restricted cash	(14		)	(19		)

Net decrease in cash, cash equivalents and restricted cash	(146		)	(11,166		)
Cash, cash equivalents and restricted cash at beginning of period	3,355			14,804
Cash, cash equivalents and restricted cash at end of period	$	3,209		$	3,638

Supplemental disclosure of non-cash information:
Purchase of property and equipment included in accounts payable and accrued expenses	$	41		$	—
Right-of-use assets acquired in exchange for lease liabilities	$	—		$	194

The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements

YIELD10 BIOSCIENCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

UNAUDITED

(In thousands, except share amounts)



	Three Months Ended September 30, 2019
	Series A Convertible
	Preferred Stock			Common Stock
	Shares	Par Value		Shares	Par Value		Additional Paid-In Capital		Accumulated other Comprehensive Loss			Accumulated Deficit			Total Stockholders' Equity
Balance, June 30, 2019	—	$	—	12,494,731	$	125	$	360,516	$	(118	)	$	(356,069	)	$	4,454
Non-cash stock-based compensation expense	—	—		—	—		131		—			—			131
Issuance of common stock for 401(k) match	—	—		24,286	—		23		—			—			23
Effect of foreign currency translation and unrealized loss on investments	—	—		—	—		—		(6		)	—			(6		)
Net loss	—	—		—	—		—		—			(1,982		)	(1,982		)
Balance, September 30, 2019	—	$	—	12,519,017	$	125	$	360,670	$	(124	)	$	(358,051	)	$	2,620



	Three Months Ended September 30, 2018
	Series A Convertible
	Preferred Stock			Common Stock
	Shares	Par Value		Shares	Par Value		Additional Paid-In Capital		Accumulated other Comprehensive Loss			Accumulated Deficit			Total Stockholders' Equity
Balance, June 30, 2018	—	$	—	9,991,977	$	100	$	357,013	$	(99	)	$	(347,438	)	$	9,576
Non-cash stock-based compensation expense	—	—		—	—		356		—			—			356
Issuance of common stock for 401(k) match	—	—		19,418	—		27		—			—			27
Effect of foreign currency translation and unrealized loss on investments	—	—		—	—		—		(6		)	—			(6		)
Net loss	—	—		—	—		—		—			(2,638		)	(2,638		)
Balance, September 30, 2018	—	$	—	10,011,395	$	100	$	357,396	$	(105	)	$	(350,076	)	$	7,315

The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements

YIELD10 BIOSCIENCE, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(UNAUDITED)

(In thousands, except share amounts)



	Nine Months Ended September 30, 2019
	Series A Convertible
	Preferred Stock			Common Stock
	Shares	Par Value		Shares	Par Value		Additional Paid-In Capital			Accumulated other Comprehensive Loss			Accumulated Deficit			Total Stockholders' Equity
Balance, December 31, 2018	—	$	—	10,025,811	$	100	$	357,646		$	(110	)	$	(351,938	)	$	5,698
Non-cash stock-based compensation expense	—	—		—	—		406			—			—			406
Issuance of common stock for 401(k) match	—	—		66,892	—		64			—			—			64
Issuance of stock for restricted stock unit vesting, net of 2,449 shares withheld for employee taxes	—	—		4,652	—		(4		)	—			—			(4		)
Issuance of common stock for registered direct offering, net of $349 offering costs	—	—		2,421,662	25		2,558			—			—			2,583
Effect of foreign currency translation and unrealized loss on investments	—	—		—	—		—			(14		)	—			(14		)
Net loss	—	—		—	—		—			—			(6,113		)	(6,113		)
Balance, September 30, 2019	—	$	—	12,519,017	$	125	$	360,670		$	(124	)	$	(358,051	)	$	2,620



	Nine Months Ended September 30, 2018
	Series A Convertible
	Preferred Stock					Common Stock
	Shares		Par Value			Shares	Par Value		Additional Paid-In Capital			Accumulated other Comprehensive Loss			Accumulated Deficit			Total Stockholders' Equity
Balance, December 31, 2017	1,826		$	818		9,089,159	$	91	$	355,431		$	(85	)	$	(342,753	)	$	13,502
Non-cash stock-based compensation expense	—		—			—	—		952			—			—			952
Issuance of common stock for 401(k) match	—		—			51,178	—		86			—			—			86
Issuance of stock for restricted stock unit vesting, net of 2,703 shares withheld for employee taxes	—		—			4,401	—		(6		)	—			—			(6		)
Issuance of common stock upon conversion of Series A Convertible Preferred Stock	(1,826	)	(818		)	811,557	8		810			—			—			—
Issuance of common stock upon exercise of Class B warrants	—		—			55,100	1		123			—			—			124
Effect of foreign currency translation and unrealized loss on investments	—		—			—	—		—			(20		)	—			(20		)
Net loss	—		—			—	—		—			—			(7,323		)	(7,323		)
Balance, September 30, 2018	—		$	—		10,011,395	$	100	$	357,396		$	(105	)	$	(350,076	)	$	7,315

The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements

YIELD10 BIOSCIENCE, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED

(All dollar amounts, except share and per share amounts, are stated in thousands)

1. NATURE OF BUSINESS AND BASIS OF PRESENTATION

Yield10 Bioscience, Inc. ("~~Yield10 Bioscience," "Yield10" or the "Company"~~Yield10") ~~was founded as Metabolix, Inc. in 1992 and changed its name in January 2017. Yield10~~ is an agricultural bioscience company ~~focusing on~~which uses its "Trait Factory" to develop high value seed traits for the ~~development of new technologies~~agriculture and food industries. Specifically, Yield10 plans to efficiently develop superior gene traits for the major grain crops corn, soybean, canola, wheat and rice that will enable step-change increases in crop yield to enhance global food security. Yield10 is using two proprietary advanced biotechnology trait gene discovery platforms to improve fundamental crop yield through enhanced photosynthetic carbon capture and increased carbon utilization efficiency to increase seed yield. These platforms are basedof at least 10-20 percent. While maintaining its focus on the principle that plants which capture and utilize carbon more efficiently will enable more robust crops capable of increased seed yield. Yield10 is working to translate and demonstrate the commercial valuedevelopment of novel yield ~~trait genes it~~traits for key crops based on a licensing model, the Company has ~~identified~~recently begun to execute the second part of its strategy which is to develop independent business opportunities for Yield10 in ~~major~~the specialty oils and niche crop space using the oilseed Camelina. The target of this effort is sustainable business solutions to support agriculture, global food production and other specialty applications. Yield10 brings a unique history, skill set, and tools captured in its Gene Ranking Artificial Intelligence Network ("GRAIN") platform for developing advanced crop traits and increasing the concentration of specific biochemicals of commercial interest in crops. The Company's plan is to develop a source of revenue from funded research and development collaborations for traits, products and crops not being directly pursued internally. While there is no guarantee of success, the Company is currently engaged in a range of discussions with third parties on different crops, traits and ~~to identify additional genome editing targets for improved crop performance~~products in ~~several key~~the feed, food and ~~feed crops, including canola, soybean, rice and corn.~~pharmaceutical sectors. Yield10 Bioscience is headquartered in Woburn, Massachusetts and has an ~~additional agricultural science facility with greenhouses located~~oilseed development Center of Excellence in Saskatoon, Saskatchewan, Canada.

The accompanying unaudited condensed consolidated financial statements are unaudited and have been prepared by Yield10 in accordance with accounting principles generally accepted in the United States of America ~~(GAAP)~~("GAAP") and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ~~(SEC)~~("SEC"). Certain information and footnote disclosures normally included in the Company’s annual consolidated financial statements have been condensed or omitted. The year-end condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP. The condensed consolidated financial statements, in the opinion of management, reflect all adjustments (consisting only of normal recurring adjustments) necessary for a fair ~~statement~~statements of the financial position and results of operations for the interim periods ended September 30, ~~2017~~2019 and ~~2016.~~September 30, 2018. The Company adopted Accounting Standards Update ("ASU") No. 2016-02, Leases, ("Topic 842") on January 1, 2019 using a modified retrospective approach. As a result, the Company's unaudited condensed consolidated balance sheet at December 31, 2018 and its unaudited condensed consolidated statements of operations, comprehensive loss, cash flows and stockholders' equity for the three and nine months ended September 30, 2018, included herein, have been adjusted to incorporate the guidance of Topic 842. See Note 8.

The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for any future period or the entire fiscal year. These interim unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, ~~2016,~~2018, which are contained in the Company’s Annual Report on Form 10-K filed with the SEC on March ~~30, 2017.~~

On May 26, 2017, the Company effected a 1-for-10 reverse stock split of its common stock. The ratio for the reverse stock split was determined by the Company's board of directors following approval by stockholders at the Company's annual meeting held on May 24, 2017. Unless otherwise indicated, all share amounts, per share data, share prices, exercise prices, and conversion rates set forth in these notes and the accompanying condensed consolidated financial statements have, where applicable, been adjusted retroactively to reflect this reverse stock split.28, 2019.

The accompanying condensed consolidated financial statements have been prepared on a basis which assumes that the Company will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business. With the exception of ~~2012, when the Company recognized $38,885 of deferred revenue from~~ a ~~terminated joint venture,~~single year, the Company has recorded losses since its initial founding, including ~~its fiscal quarter ending~~the three and nine months ended September 30, 2017. During 2016, the Company completed a strategic restructuring under which Yield10 Bioscience became its core business. In connection with the restructuring, the Company discontinued its pilot biopolymer production and other biopolymer operations, sold substantially all of its biopolymer assets to CJ CheilJedang Corporation ("CJ") for a total purchase price of $10,000 and reduced staffing levels to approximately twenty full-time employees as of December 31, 2016, in order to focus on crop science activities and significantly reduce the Company's cash burn rate used in operations. During 2016, the Company recorded restructuring charges of $3,513 and as of September 30, 2017, restructuring obligations of $789 remain outstanding with various payment due dates through May 2018.

2019.

As of September 30, ~~2017,~~2019, the Company held unrestricted cash, ~~and~~ cash equivalents and short-term investments of ~~$2,951. On July 7, 2017,~~$2,877. The Company follows the ~~Company completed~~guidance of Accounting Standards Codification ("ASC") Topic 205-40, Presentation of Financial Statements-Going Concern, in order to determine whether there is substantial doubt about its ability to continue as a ~~registered direct offering of~~going concern for one year after the date its ~~securities and raised net proceeds from the transaction of approximately $1,966. As a result of raising these additional funds, the Company anticipates that~~financial statements are issued. Based on its current cash forecast, management expects that the Company's present capital resources will be sufficient to fund its planned operations and meet its obligations ~~including its remaining restructuring obligations, when due,~~ into the first quarter of ~~2018.~~2020. This forecast of cash resources is forward-looking information that involves risks and uncertainties, and the actual amount of expenses could vary materially and adversely as a result of a number of factors. ~~The Company has evaluated the guidance of the Financial Accounting Standards Board's ("FASB") Accounting Standards Update ("ASU") No. 2014-15,~~ ~~Presentation of Financial Statements-Going Concern (Subtopic 205-40)~~ ~~in order to determine whether there is substantial~~

~~doubt about its ability to continue as a going concern for one year after the date its financial statements are issued.~~ The Company's ability to continue operations after its current cash resources are exhausted depends on its ability to obtain additional financing through, among other sources, public or private equity financing, secured or unsecured debt financing, equity or debt bridge financing, warrant holders' ability and willingness to exercise the Company's outstanding warrants, additional government ~~research~~ grants or collaborative arrangements with third parties, as to which no ~~assurances~~assurance can be given. Management does not know whether additional financing will be available on terms favorable or acceptable to the Company when needed, if at all. If adequate additional funds are not available when required, ~~or if the Company is unsuccessful in entering collaborative arrangements for further research,~~ management ~~may~~will be forced to curtail the Company's research efforts, explore strategic alternatives and/or wind down its operations and pursue options for liquidating its

remaining assets, including intellectual ~~property and equipment.~~property. Based on ~~the~~its cash forecast, management has determined that the Company's present capital resources ~~are~~will not be sufficient to fund its planned operations for the twelve months from the date that ~~the~~these financial statements are ~~issued,~~filed, which raises substantial doubt about the Company's ability to continue as a going concern.

~~In October 2015,~~On September 9, 2019, the Company ~~entered into~~filed a registration statement on Form S-1 (the "Registration Statement"), as amended on October 11 and November 8, 2019. The Registration Statement, which has not yet been declared effective by the Securities and Exchange Commission, relates to offer to sell 2,777,777 Class A Units, consisting of common stock ~~purchase agreement with Aspire Capital Fund, LLC, (Aspire) under which Aspire was committed~~and warrants, and 4,000 Class B Units consisting of Series A Convertible Preferred Stock and warrants, as more fully described in the Registration Statement. Estimated cash proceeds from the sale of the Class A and Class B Units, net of offering expenses, are estimated to ~~purchase, at~~be $4.4 million. The Company also intends to conduct a concurrent private placement of Series B Convertible Preferred Stock and warrants to the Company's ~~direction, up to an~~largest shareholder, for estimated net proceeds of $4.2 million, for total aggregate proceeds from the offering of ~~$20,000 of shares~~approximately $8.6 million before the exercise of the ~~Company's common stock over~~over-allotment option available to the underwriter of the offering. There can be no assurance that this offering of securities will close for the full amount the Company is seeking to raise, or at all.

If the Company issues equity or debt securities to raise additional funds, (i) the Company may incur fees associated with such issuance, (ii) its existing stockholders may experience dilution from the issuance of new equity securities, (iii) the

Company may incur ongoing interest expense and be required to grant a ~~30 month period. Aspire purchase transactions would have utilized pricing formulas that qualify them as variable rate transactions, as defined~~security interest in ~~the securities purchase agreement entered into~~Company assets in connection with any debt issuance, and (iv) the ~~Company's~~new equity or debt securities ~~offering completed in July 2017. Because variable rate transactions~~may have rights, preferences and privileges senior to those of the Company’s existing stockholders. In addition, utilization of the Company’s net operating loss and research and development credit carryforwards may be subject to significant annual limitations under Section 382 of the Internal Revenue Code of 1986, as amended, (the "Internal Revenue Code") due to ownership changes resulting from equity financing transactions. If the Company raises additional funds through collaboration, licensing or other similar arrangements, it may be necessary to relinquish valuable rights to its potential products or proprietary technologies or grant licenses on terms that are ~~prohibited by the securities agreement entered into in conjunction with the Company's equity offering completed during July 2017, the Aspire facility is no longer available~~not favorable to the ~~Company as a source of capital.~~Company.

2. ACCOUNTING POLICIES

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting bodies that the Company adopts as of the specified effective date. During the nine months ended September 30, ~~2017,~~2019, the Company adopted the following new accounting guidance.

In February 2016, the FASB issued ASU No. ~~2016-09,~~ 2016-02, which requires lessees to recognize most leases on their balance sheet as right-of-use assets and lease liabilities. In July 2018, the FASB issued ASU No. 2018-10, "~~Compensation - Stock Compensation (Topic 718):~~Codification Improvements to ~~Employee Share-Based Payment Accounting~~Topic 842, Leases" ("ASU ~~No. 2016-09"~~2018-10")~~. ASU No. 2016-09 involves several~~, which provided narrow amendments to clarify how to apply certain aspects of the ~~accounting of share-based payment transactions of~~new lease standard, and ASU No. 2018-11, "Leases (Topic 842 - Targeted Improvements)" ("ASU 2018-11"), which addressed implementation issues related to the ~~accounting~~new lease standard. The new guidance was effective for ~~forfeitures of stock awards is the most significant for the Company.~~annual reporting periods beginning after December 15, 2018 and interim periods within those fiscal years. Under the ~~adopted guidance,~~new standard, disclosures are required to enable users of financial statements to better assess the ~~Company made an accounting policy election~~amount, timing, and uncertainty of cash flows arising from leases. Topic 842 required filers to ~~account for forfeitures as they occur rather than continue with~~adopt the ~~previous method~~new standard using a modified retrospective approach under either of ~~estimating forfeiture rates when determining~~two transition methods; (1) to apply the ~~fair value of service-based stock awards and then adjusting compensation expense in later periods for actual forfeitures as they occur or to reverse~~new lease requirements at the ~~effects~~beginning of the ~~estimated forfeiture rates if a forfeiture does not occur.~~earliest period presented, or (2) to apply the new lease requirements at the effective date. The Company ~~previously provided~~adopted the new standard on January 1, 2019 and elected to adjust its 2018 and 2017 financial statements in order to make them comparable to its 2019 financial statements. Adoption of Topic 842 had a ~~forfeiture rate of approximately 6 percent. Due to the nature of vesting terms of the Company's stock options, the adoption of this standard had no~~ material impact on the Company's ~~operations or~~previously reported 2018 and 2017 financial ~~position.~~statements. See Note 8.

~~Other than~~New pronouncements that are not yet effective but may impact the Company's financial statements in the future are described below.

In June 2016, the FASB issued ASU No. ~~2016-09, there~~2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The FASB has subsequently issued amendments to ASU 2016-13, which have ~~been no material changes in accounting policies since~~ the ~~Company’s fiscal year ended December 31, 2016, as described in Note 2~~same effective date and transition date of January 1, 2020. These standards require that credit losses be reported using an expected losses model rather than the incurred losses model that is currently used, and establishes additional disclosures related to credit risks. For available-for-sale debt securities with unrealized losses, this standard now requires allowances to be recorded instead of reducing the amortized cost of the investment. These standards limit the amount of credit losses to be recognized for available-for-sale debt securities to the amount by which carrying value exceeds fair value and requires the reversal of previously recognized credit losses if fair value increases. The Company is evaluating the potential impact of the standard on its consolidated financial ~~statements included in its Annual Report~~position, results of operations and related disclosures.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. This standard modifies certain disclosure requirements on ~~Form 10-K~~fair value measurements and will become effective for the ~~year then ended.~~Company on January 1, 2020. The Company is evaluating the potential impact of the standard on its consolidated financial position and results of operations and related disclosures.

In November 2018, the FASB issued ASU No. 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606. This standard makes targeted improvements for collaborative arrangements as follows:

Clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue under ASC 606, Revenue from Contracts with Customers, when the collaborative arrangement participant is a customer in the context of a unit of account. In those situations, the guidance in ASC 606 should be applied, including recognition, measurement, presentation and disclosure requirements;

Adds unit-of-account guidance to ASC 808, Collaborative Arrangements, to align with the guidance in ASC 606 (that is, a distinct good or service) when an entity is assessing whether the collaborative arrangement or a part of the arrangement is within the scope of ASC 606; and

Precludes a company from presenting transactions with collaborative arrangement participants that are not directly related to sales to third parties with revenue recognized under ASC 606 if the collaborative arrangement participant is not a customer.

This standard will become effective for the Company on January 1, 2020; however, early adoption is permitted. A retrospective transition approach is required for either all contracts or only for contracts that are not completed at the date of initial application of ASC 606, with a cumulative adjustment to opening retained earnings, as of January 1, 2019. The Company is currently evaluating the potential impact that this standard may have on its consolidated financial position, results of operations and related disclosures.

Principles of Consolidation

The Company's unaudited condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America. The unaudited condensed consolidated financial statements include the accounts of the Company and its ~~wholly-owned~~wholly owned subsidiaries. All intercompany transactions were eliminated, including transactions with its Canadian subsidiary, Metabolix Oilseeds, Inc.

~~On September 16, 2016,~~Cash, Cash Equivalents and Restricted Cash

The Company considers all highly liquid investments purchased with an original maturity date of ninety days or less at the ~~Company completed~~date of purchase to be cash equivalents.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the ~~sale~~Company's Unaudited Condensed Consolidated Balance Sheets included herein:



	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	2,877	$	3,023
Restricted cash	332		332
Total cash, cash equivalents and restricted cash	$	3,209	$	3,355

Amounts included in restricted cash represent those required to be set aside by contractual agreement. Restricted cash of its biopolymer intellectual property and certain equipment and inventory to an affiliate of CJ in a transaction that met the requirements for discontinued operations reporting in accordance with ASU No. 2014-08, ~~Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity~~$332~~. The condensed consolidated financial statements for the three and nine month periods ending~~ at September 30, ~~2016, have been presented to reflect~~2019 and December 31, 2018 consists of funds held in connection with the Company's ~~biopolymer operation as a discontinued operation.~~lease agreement for its Woburn, Massachusetts facility.

~~Restructuring~~Investments

~~In July 2016, the Company announced a strategic restructuring under which Yield10 Bioscience became its core business and its biopolymer operations were discontinued.~~ The Company ~~records estimated restructuring charges for employee severance~~considers all investments purchased with an original maturity date of more than ninety days at the date of purchase and ~~contract termination costs~~a maturity date of one year or less at the balance sheet date to be short-term investments. All other investments are classified as a current period expense as those costs become contractually fixed, probable and estimable. Obligations associated with these charges are reduced or adjusted as payments are made or the Company's estimates are revised.long-term.

Other-than-temporary impairments of equity investments are recognized in the Company's statements of operations if the Company has experienced a credit loss and has the intent to sell the investment or if it is more likely than not that the Company will be required to sell the investment before recovery of the amortized cost basis. Realized gains and losses, dividends, interest income and declines in value judged to be other-than-temporary credit losses are included in other income (expense). Any premium or discount arising at purchase is amortized and/or accreted to interest income.

Use of Estimates

The preparation of financial statements in conformity with ~~accounting principles generally accepted in the United States of America ("GAAP")~~GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of ~~revenues~~grant revenue and expenses during the reporting periods. Actual results could differ from those estimates.

Foreign Currency Translation

Foreign denominated assets and liabilities of the Company's wholly owned foreign subsidiaries are translated into U.S. dollars at the prevailing exchange rates in effect on the balance sheet date. Revenues and expenses are translated at average exchange rates prevailing during the period. Any resulting translation gains or losses are recorded in accumulated other comprehensive income (loss) in the consolidated balance sheet. When the Company dissolves, sells or substantially sells all of the assets of a consolidated foreign subsidiary, the cumulative translation gain or loss of that subsidiary is released from comprehensive income (loss) and included within its consolidated statement of operations during the fiscal period when the dissolution or sale occurs.

Income Taxes

~~Deferred~~The Company accounts for income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the consolidated financial statements or in the Company's tax returns. Under this method, deferred tax assets and liabilities are ~~recognized~~determined based on ~~temporary differences~~the difference between the financial ~~reporting~~statement and tax basis of assets and liabilities using ~~future~~ enacted tax ~~rates.~~rates in effect for the year in which the differences are expected to reverse. A valuation allowance is ~~recorded against~~provided to reduce the deferred tax ~~assets if it is~~asset to a level which, more likely than not, ~~that some or all of the deferred tax assets~~ will ~~not~~ be realized.

Due to the uncertainty surrounding the realization of favorable tax attributes in future tax returns, the Company has recorded a full valuation allowance against its otherwise recognizable net deferred tax assets.

The Company follows the accounting guidance related to income taxes including guidance which addresses accounting for uncertainty in income taxes. This guidance prescribes a threshold for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosures and transitions. The Company had no amounts recorded for any unrecognized tax benefits as of September 30, 2017 or December 31, 2016.

For the three and nine months ended September 30, 2016, the Company recognized an income tax benefit of $1,042 and tax expense in discontinued operations for both periods of $1,259 related to discontinuation of its biopolymer operations.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk primarily consist of cash, cash equivalents and ~~cash equivalents.~~investments. The Company has historically invested its cash ~~equivalents~~ in highly rated money market funds, corporate debt, federal agency notes and U.S. treasury notes. Investments, when purchased, are acquired in accordance with the Company’s investment policy which establishes a concentration limit per issuer.

At September 30, ~~2017, the Company’s cash equivalents are invested solely in money market funds.~~

The Company provides credit to customers in the normal course of business. The Company performs ongoing credit evaluations of its customers’ financial condition and limits the amount of credit extended when deemed necessary. At September 30, 2017, 94%2019, 100% of the Company's total accounts and unbilled receivables ~~of $237~~ are due from U.S. government grants.

3. ~~RECENT ACCOUNTING PRONOUNCEMENTS~~

~~From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted as of the specified effective date.~~

~~In August 2016, the FASB issued ASU No. 2016-15,~~ ~~Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments~~. The new standard clarifies certain aspects of the statement of cash flows, including the classification of debt prepayment or debt extinguishment costs, settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, distributions received from equity method investees and beneficial interests in securitization transactions. The new standard also clarifies that an entity should determine each separately identifiable source or use within the cash receipts and cash payments on the basis of the nature of the underlying cash flows. In

situations in which cash receipts and payments have aspects of more than one class of cash flows and cannot be separated by source or use, the appropriate classification should depend on the activity that is likely to be the predominant source or use of cash flows for the item. The new standard will be effective for the Company on January 1, 2018. The Company is in the process of evaluating the impact of this new guidance.

~~In June 2016, the FASB issued ASU No. 2016-13,~~ ~~Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments~~. The new standard changes the impairment model for most financial assets and certain other instruments. Under the new standard, entities holding financial assets and net investment in leases that are not accounted for at fair value through net income are to be presented at the net amount expected to be collected. An allowance for credit losses will be a valuation account that will be deducted from the amortized cost basis of the financial asset to present the net carrying value at the amount expected to be collected on the financial asset. The new standard will be effective for the Company on January 1, 2020. The Company is in the process of evaluating the impact of this new guidance.

~~In February 2016, the FASB issued ASU 2016-02,~~ ~~Leases (Topic 842).~~ The new standard requires that all lessees recognize the assets and liabilities that arise from leases on the balance sheet and disclose qualitative and quantitative information about their leasing arrangements. The new standard will be effective for the Company on January 1, 2019. The Company is in the process of evaluating the impact of this new guidance.

~~In January 2016, the FASB issued ASU No. 2016-01,~~ ~~Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities~~. The new standard amends certain aspects of accounting and disclosure requirements of financial instruments, including the requirement that equity investments with readily determinable fair values be measured at fair value with changes in fair value recognized in the Company's results of operations. The new standard does not apply to investments accounted for under the equity method of accounting or those that result in consolidation of the investee. Equity investments that do not have readily determinable fair values may be measured at fair value or at cost minus impairment adjusted for changes in observable prices. A financial liability that is measured at fair value in accordance with the fair value option is required to be presented separately in other comprehensive income for the portion of the total change in the fair value resulting from change in the instrument-specific credit risk. In addition, a valuation allowance should be evaluated on deferred tax assets related to available-for-sale debt securities in combination with other deferred tax assets. The new standard will be effective for the Company on January 1, 2018. The Company is in the process of evaluating the impact of this new guidance.

~~In May 2014, the FASB issued ASU No. 2014-09,~~ ~~Revenue from Contracts with Customers (Topic 606).~~ The ASU is the result of a joint project by the FASB and the International Accounting Standards Board ("IASB") to clarify the principles for recognizing revenue and to develop a common revenue standard for GAAP and International Financial Reporting Standards ("IFRS") that would: remove inconsistencies and weaknesses, provide a more robust framework for addressing revenue issues, improve comparability of revenue recognition practices across entities, jurisdictions, industries, and capital markets, improve disclosure requirements and resulting financial statements, and simplify the presentation of financial statements. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU is effective for annual reporting periods beginning after December 15, 2016. Early adoption is not permitted. On July 9, 2015, the FASB voted to delay the effective date of the new revenue standard by one year, but to permit entities to choose to adopt the standard as of the original date. The Company is currently in the process of evaluating the effects the new revenue standard will have on its consolidated financial statements and related disclosures. The Company intends to complete the process during 2017 and adopt the standard on January 1, 2018, using the modified retrospective adoption transition method. The adoption of this standard is not expected to have a material impact on the Company's financial position or results of operations.

4. BASIC AND DILUTED NET INCOME (LOSS) PER SHARE

Basic net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of common shares outstanding. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of dilutive common shares outstanding during the period. Diluted shares outstanding is calculated by adding to the weighted shares outstanding any potential (unissued) shares of common stock from outstanding stock options and warrants based on the treasury stock method, as well as weighted shares outstanding of any potential (unissued) shares of common stock from restricted stock units. In periods when a net loss is reported, all common stock equivalents are excluded from the calculation because they would have an anti-dilutive effect, meaning the loss per share would be reduced. Therefore, in periods when a loss is reported, ~~there is no difference in~~ basic and dilutive loss per ~~share.~~share are the same. Common stock equivalents include stock options, restricted stock awards and warrants.

On May 26, 2017, the Company effected a 1-for-10 reverse stock split of its common stock. The calculation of basic and diluted net loss per share, as presented in the accompanying condensed consolidated statement of operations, have been determined based on a retroactive adjustment of weighted average shares outstanding for all periods presented.

The number of shares of potentially dilutive common stock presented on a weighted average basis, related to options, restricted stock units and warrants (prior to consideration of the treasury stock method) that were excluded from the calculation of dilutive shares since the inclusion of such shares would be anti-dilutive for the three and nine months ended September 30, ~~2017~~2019 and ~~2016,~~September 30, 2018, respectively, are shown below. Issued and outstanding warrants shown in the table below are described in greater detail in Note 11, contained herein.


	Three Months Ended September 30,		Nine Months Ended September 30,		Three Months Ended September 30,		Nine Months Ended September 30,
	2017	2016	2017	2016	2019	2018	2019	2018
Options	626,263	92,600	621,030	93,159	2,451,995	1,661,853	2,055,065	1,163,493
Restricted stock units	14,367	58,824	16,770	82,766	—	7,101	2,341	9,461
Warrants	920,655	393,300	571,017	393,300	7,039,784	7,433,084	7,278,933	7,433,084
Total	1,561,285	544,724	1,208,817	569,225	9,491,779	9,102,038	9,336,339	8,606,038

4. INVESTMENTS

Investments consist of the following at December 31, 2018:



	Accumulated Cost		Unrealized				Market Value
December 31, 2018	Accumulated Cost		Gain		(Loss)		Market Value
Short-term investments
Government securities	$	2,746	$	—	$	—	$	2,746
Total	$	2,746	$	—	$	—	$	2,746

There were no long or short-term investments at September 30, 2019, and no long-term investments at December 31, 2018.

5. FAIR VALUE MEASUREMENTS

The Company has certain financial assets recorded at fair value which have been classified as either Level 1 or 2 within the fair value hierarchy as described in the accounting standards for fair value measurements. Fair value is the price that would be received from the sale of an asset or the price paid to transfer a liability in an orderly transaction between independent market participants at the measurement date. Fair values determined by Level 1 inputs utilize observable data such as quoted prices in active ~~markets for identical instruments.~~markets. Fair values determined by Level 2 inputs utilize data points other than quoted prices in active markets that are observable either directly or indirectly. Fair values determined by Level 3 inputs utilize unobservable data points in which there is little or no market data, which require the reporting entity to develop its own assumptions. The fair value hierarchy level is determined by the lowest level of significant input. At September 30, ~~2017~~2019 and December 31, ~~2016,~~2018, the Company did not own any Level ~~2 or Level~~ 3 financial ~~assets or liabilities and there were no transfers of~~assets.

The Company’s financial assets classified as Level 2 at September 30, 2019 and December 31, 2018, were initially valued at the transaction price and subsequently valued utilizing third-party pricing services. Because the Company’s investment portfolio may include securities that do not always trade on a daily basis, the pricing services use many observable market inputs to determine value including reportable trades, benchmark yields and benchmarking of like securities. The Company validates the prices provided by the third-party pricing services by reviewing their pricing methods and obtaining market values from other pricing sources. After completing the validation procedures, the Company did not adjust or ~~liabilities between category levels.~~

override any fair value measurements provided by these pricing services as of September 30, 2019 and December 31, 2018.

The ~~Company's~~tables below present information about the Company’s assets that are measured at fair value on a recurring ~~basis. The balance of Level 1 assets~~basis as of September 30, ~~2017~~2019 and December 31, ~~2016~~2018 and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value.



	Fair value measurements at reporting date using
	Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs		Balance as of
Description	(Level 1)		(Level 2)		(Level 3)		September 30, 2019
Cash equivalents:
Money market funds	$	1,884	$	—	$	—	$	1,884
U.S. government and agency securities	—		500		—		500
Total	$	1,884	$	500	$	—	$	2,384



	Fair value measurements at reporting date using
	Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs		Balance as of
Description	(Level 1)		(Level 2)		(Level 3)		December 31, 2018
Cash equivalents:
Money market funds	$	2,663	$	—	$	—	$	2,663
Short-term investments:
U.S. government agency securities	—		2,746		—		2,746
Total	$	2,663	$	2,746	$	—	$	5,409

There were ~~$1,023~~no transfers of financial assets between category levels for the three and ~~$1,018, respectively,~~nine months ended September 30, 2019.

The Company owns 648,149 shares of Series A Redeemable Convertible Preferred Stock of Tepha, Inc. ("Tepha"), a privately held medical device company located in Lexington, Massachusetts, that is engaged in the development of medical device products that restore, maintain, or improve tissue function. The Company received the preferred shares from Tepha during 2002 in connection with a technology sublicense agreement that was later terminated during 2016. The preferred shares owned by the Company represent less than one percent of Tepha's current outstanding common shares on a fully diluted basis and ~~for both periods the assets~~ were ~~invested in money market funds classified in cash and cash equivalents.~~

fully written off through an impairment charge during 2005 prior to Tepha initiating commercial product sales.

6. ACCRUED EXPENSES

Accrued expenses consisted of the following at:


	September 30, 2017		December 31, 2016		September 30, 2019		December 31, 2018
Employee compensation and benefits	$	203	$	713	$	160	$	98
Contract termination obligation	727		939
Leased facilities					49		50
Professional services	315		459		398		234
Other	693		591		298		298
Total accrued expenses	$	1,938	$	2,702	$	905	$	680

7. STOCK-BASED COMPENSATION

Expense Information for Employee and Non-Employee Stock Awards

The Company recognized stock-based compensation expense related to stock awards, including awards to non-employees and members of ~~$400~~the Board of Directors of $131 and ~~$1,063~~$406 for the three and nine months ended September 30, ~~2017, respectively. The Company recognized stock-based compensation expense related to stock awards of $254 and $1,155 for~~2019. During the three and nine months ended September 30, ~~2016. Of~~2018, the ~~amounts reflected for the three~~Company recognized $356 and ~~nine months ended September 30, 2016, $16 and $212 were included in discontinued operations within the Company's condensed consolidated statements~~$952 of ~~operations.~~stock-based compensation expense, respectively. At September 30, ~~2017,~~2019, there was approximately ~~$1,260~~$1,350 of pre-tax stock-based compensation expense related to unvested awards not yet recognized.

The compensation expense related to unvested stock options is expected to be recognized over a remaining weighted average period of ~~1.07~~3.10 years.

Stock Options

A summary of option activity for the nine months ended September 30, ~~2017~~2019 is as follows:


	Number of Shares		Weighted Average Exercise Price		Number of Shares		Weighted Average Exercise Price
Outstanding at December 31, 2016	605,077		$	34.49
Outstanding at December 31, 2018					1,745,037		$	6.38
Granted	47,150		3.94		748,868		$	0.89
Exercised	—		—		—		—
Forfeited	(2,534	)	5.55		(7,500	)	$	1.43
Expired	(23,508	)	417.30		(1,930	)	$	323.51
Outstanding at September 30, 2017	626,185		$	17.93
Outstanding at September 30, 2019					2,484,475		$	4.49

Options vested and expected to vest at September 30, 2017	626,185		$	17.93
Options exercisable at September 30, 2017	246,545		$	37.40
Options vested and expected to vest at September 30, 2019					2,484,475		$	4.49
Options exercisable at September 30, 2019					1,172,762		$	8.09

Restricted Stock Units

Restricted Stock Units ("RSUs") awarded to employees generally vest in four equal annual installments beginning one year after the date of grant, subject to service conditions. RSUs awarded to non-employee directors generally vest one year after the date of grant, with the exception of RSUs granted in lieu of cash compensation, which vest immediately. The Company records stock compensation expense for ~~RSUs~~restricted stock units ("RSUs") on a ~~straight line~~straight-line basis over their requisite service period, which approximates the vesting period, based on each RSU's award date market value.

~~The Company pays minimum federal, state or provincial income tax withholding associated with RSUs for its U.S. and Canadian employees.~~ As ~~the~~ RSUs vest, the Company withholds a number of shares from its employees with an aggregate fair market value equal to the minimum tax withholding amount (unless the employee makes other arrangements for payment of the tax withholding) from the common stock issuable at the vest date. The Company then pays the minimum required income tax for the employees. During the nine months ended September 30, ~~2017~~2019 and ~~2016,~~September 30, 2018, the Company paid ~~$12~~$4 and ~~$274,~~$6, respectively, for income tax withholdings associated with RSUs ~~that vested~~ during these periods.

A summary of RSU activity for the nine months ended September 30, ~~2017~~2019 is as follows:

Number of RSUs Weighted Average Remaining Contractual Life (years)
Outstanding at December 31, 2016 21,735

Awarded 25,337

Common stock issued upon vesting (32,542 )
Forfeited (163 )
Outstanding at September 30, 2017 14,367
1.00

Weighted average remaining recognition period 1.50



	Number of RSUs		Weighted Average Remaining Contractual Life (years)
Outstanding at December 31, 2018	7,101
Awarded	—
Common stock issued upon vesting	(7,101	)
Forfeited	—
Outstanding at September 30, 2019	—		—

At September 30, 2019, the Company had no remaining unvested RSUs outstanding.

8. LEASES

New Lease Accounting

Topic 842 is effective for annual reporting periods beginning after December 15, 2018 and for interim periods within those fiscal years. The Company adopted Topic 842 on January 1, 2019 and elected to apply the new lease accounting requirements to its financial statements beginning on January 1, 2017 (the earliest period presented in its comparative financial statements), using a modified retrospective approach. The new guidance also requires additional financial statement disclosures to enable users of financial statements to better assess the amount, timing, and uncertainty of cash flows arising from leases. Topic 842 replaced the previous lease accounting and reporting guidance of ASC Topic 840, Leases, ("ASC Topic 840") and requires lessees to reflect a right-of-use asset and a lease liability on their balance sheet for leases with terms of more than twelve months.

~~8. COMMITMENTS AND CONTINGENCIES~~The Company's enactment of Topic 842, effective on January 1, 2019, resulted in it recording right-of-use assets and lease liabilities for real estate and equipment leases of $4,766 and $6,465, respectively, as of that date. The Company also eliminated $1,005 in lease incentive obligations from its balance sheet on January 1, 2019 as a result of the discontinuation of the previous guidance under ASC Topic 840. Application of the new pronouncement to the Company's 2018 and 2017 comparative years had a material effect on these previously issued financial statements. The Company's condensed consolidated balance sheet as of December 31, 2018 has been revised to reflect the $4,766 right-of-use asset and $6,465 lease liability as of that date. The condensed consolidated statements of operations, comprehensive income (loss), cash flows and stockholders' equity for the three and nine months ended September 30, 2018, included herein, have also been adjusted to incorporate the guidance of Topic 842 and the impact was immaterial.

Under Topic 842, leases are classified as either operating or finance leases, with classification based on criteria similar to previous lease accounting guidance, but without the explicit quantitative determining factors used to establish a lease as either a capital or an operating lease. The Company reviewed its 2018 and 2017 transitional leases and its currently active leases falling within the scope of Topic 842 and determined that all of these leases met the criteria for classification as operating leases.

Lease ~~Commitments~~liabilities are recorded as of their commencement date and are calculated as the present value of the remaining lease payments, using the interest rate implicit in the lease, or if that rate is not readily determinable, using the lessee's incremental borrowing rate. Right-of-use assets are equal to the lease liability with adjustments made, as necessary, for lease prepayments, lease accruals, initial direct costs, lessor lease incentives and any lease impairments that may be present. Topic 842 further requires that lease expense for operating leases be calculated on a straight-line basis and reported as a single operating expense within income from operations.

Topic 842 provides a number of transitional practical expedients designed to assist lessees with initial implementation. The Company made the following elections in applying Topic 842.

Short-term lease exception. Active leases as of January 1, 2017, and new leases entered into thereafter with terms of twelve months or less were and will be excluded from accounting under Topic 842.

Package of practical expedients. These expedients, which must be elected in their entirety, permit a company to continue its historical accounting during the transition period for contractual arrangements containing embedded leases in lieu of performing a re-evaluation of the agreements in order to separate lease and non-lease components. The package of expedients also permit a company to maintain its previous accounting classification for transitional leases as either operating or finance leases without reassessment under the new guidance. Lastly, the package of practical expedients does not require reassessment and capitalization of initial direct costs incurred to establish a lease.

In applying the guidance of Topic 842 to the 2018 and 2017 transition periods, the Company did not elect the available hindsight expedient with respect to the determination of lease terms used in the calculation of lease liabilities and right-of-use assets by considering the actual outcome of lease renewals.

Maturity Analysis of Lease Liabilities

At September 30, 2019, the Company's lease liabilities will mature as follows:



Year ended December 31,	Undiscounted Cash Flows
2019 (October to December)	$	318
2020	1,080
2021	939
2022	969
2023	998
Thereafter	3,082
Total undiscounted future lease payments	7,386
Discount	(1,543		)
Total lease liabilities	$	5,843
Short-term lease liabilities	$	798
Long-term lease liabilities	$	5,045

At September 30, 2019, real estate and equipment leases represent approximately 99% and 1%, of the Company's lease liabilities, respectively.

Quantitative Disclosure of Lease Costs (unaudited)



	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Lease cost:
Operating lease cost	$	257		$	521		$	774		$	1,059
Short-term lease cost	139			108			393			365
Sublease income	(126		)	(121		)	(385		)	(353		)
Total lease cost, net	$	270		$	508		$	782		$	1,071

Other information as of:							September 30, 2019			December 31, 2018
Weighted-average remaining lease term (years)							6.9			7.4
Weighted-average discount rate							6.75%			6.75%

Real Estate Leases

During 2016, the Company entered into a lease agreement for its headquarters, pursuant to which the Company leases approximately 29,622 square feet of office and research and development space located at 19 Presidential Way, Woburn, Massachusetts. The lease began on June 1, 2016 and will end on November 30, 2026. The lease agreement does not include any options for the early termination or the extension of the lease. The Company provided the landlord with a security deposit in the form of a letter of credit in the amount of $307. Pursuant to the lease, the Company will also pay certain taxes and operating costs associated with the premises ~~during~~throughout the term of the lease. During the buildout of the rented space, the landlord paid $889 for tenant improvements to the facility and an additional $444 for tenant improvements that result in increased rental payments by the Company. ~~The current and non-current portions~~Upon the adoption of Topic 842, these improvements were recorded as a reduction in the valuation of the lease incentive obligations related to the landlord’s contributions toward the cost of tenant improvements are recorded within accrued expenses and long-term lease incentive obligation, respectively, in the Company's condensed consolidated balance sheet contained herein.

right-of-use asset.

In October 2016, the Company entered into a sublease agreement with a subsidiary of CJ ~~for the~~CheilJedang Corporation ("CJ") with respect to CJ's sublease of approximately 9,874 square feet of its leased facility located in Woburn, Massachusetts. The sublease space was determined to be in excess of the Company's ~~needs as a result of its strategic shift to Yield10 Bioscience and the related restructuring of its operations.~~needs. The sublease ~~term~~ is coterminous with the Company's master ~~lease.~~lease, and CJ ~~pays~~will pay rent and operating expenses equal to approximately one-third of the amounts payable to the landlord by the Company, as adjusted from ~~time-to-time~~time to time in accordance with the terms of the master lease. ~~Total~~Future CJ sublease payments have not been presented as an offset to total undiscounted future ~~minimum operating~~ lease payments of ~~$6,854~~$7,386 shown ~~below are net of~~in the lease maturity analysis table above. CJ ~~sublease payments. CJ has~~ provided the Company with a security deposit of $103 in the form of an irrevocable letter of credit.

The Company also leases approximately 13,702 square feet of office and laboratory space at 650 Suffolk Street, Lowell, Massachusetts. The lease for this facility, as amended, expires in May ~~2020,~~2020. The terms of the agreement provide the Company with ana five-year option to ~~renew~~extend the lease provided written notice is given prior to August 31, 2019. The Company did not elect this option. During July 2018, the Company discontinued further use of the Lowell space, and as a result, the Company recorded a non-cash lease exit charge of $255 for ~~one five-year period.~~ the facility in accordance with ASC Topic 420-10, Exit or Disposal Obligations. The exit charge was recorded as an increase in the Company's lease expense and a reduction to the associated right-of-use asset. The Company will continue to make monthly rental payments for the Lowell facility through its expiration in May 2020.

The Company's ~~wholly owned~~wholly-owned subsidiary, Metabolix Oilseeds, Inc. ("MOI"), located in Saskatoon, Saskatchewan, Canada, leases approximately ~~4,100~~6,200 square feet of office, laboratory and greenhouse ~~space.~~space located within Innovation Place at 410 Downey Road and within the research facility of National Research Council Canada located at 110 Gymnasium Place. None of the leases contain renewal or early termination options. MOI's leases for ~~its various leased~~these facilities expire ~~between~~on various dates through September ~~30, 2017 and July 31, 2018. The Company expects to renew these Canadian leases prior to their expiration.~~2020.

~~Annual base rental payments remaining due under the Company's leases, net of sublease payments expected from CJ, are as follows:~~

Year ended December 31, Minimum lease payments
2017 (October to December) $ 226
2018 877
2019 855
2020 734
2021 654
2022 and thereafter 3,508
Total $ 6,854

~~Contractual Commitments~~

In connection with the discontinuation of biopolymer operations, the Company ceased pilot production of biopolymer material and reached agreements during 2016 with the owner-operators of its biopolymer pilot production facilities regarding the termination of their services. The Company recorded contract termination costs related to these manufacturing agreements of $2,641 during the quarter ended September 30, 2016, which was recorded within discontinued operations in the Company's condensed consolidated statements of operations for the year ended December 31, 2016. As of September 30, 2017, $728 remains outstanding and is payable in quarterly installments through May 2018. The short and long-term portions of these contract liabilities are recorded in accrued expenses and contract termination obligation, respectively, in the Company's condensed consolidated balance sheets contained herein.

9. COMMITMENTS AND CONTINGENCIES

Litigation

From ~~time-to-time,~~time to time, the Company may be subject to legal proceedings and claims in the ordinary course of business. The Company is not currently aware of any such proceedings or claims that it believes will have, individually or in the aggregate, a material adverse effect on ~~the~~its business, financial condition or ~~the~~ results of operations.

Guarantees

As of September 30, ~~2017~~2019 and December 31, ~~2016,~~2018, the Company did not have significant liabilities recorded for guarantees.

The Company enters into indemnification provisions under various agreements with other companies in the ordinary course of business, typically with business partners ~~contractors,~~ and ~~customers.~~contractors. Under these provisions, the Company generally indemnifies and holds harmless the indemnified party for losses suffered or incurred by the indemnified party as a result of its activities. These indemnification provisions generally survive termination of the underlying agreement. The maximum potential amount of future payments the Company could be required to make under these indemnification provisions is unlimited. However, to date Yield10 Bioscience has not incurred material costs to defend lawsuits or settle claims related to these indemnification provisions. As a result, the estimated fair value of the indemnifications under these agreements is believed to be minimal. Accordingly, the Company has no liabilities recorded for these agreements as of September 30, ~~2017~~2019 and December 31, ~~2016.~~

2018.

9.10. GEOGRAPHIC INFORMATION

The geographic distribution of the Company’s ~~operating~~grant revenues ~~from continuing operations~~ and long-lived assets are summarized in the tables below:


	U.S.		Canada		Eliminations			Total		U.S.		Canada		Eliminations			Total
Three Months Ended September 30, 2017:
Three Months Ended September 30, 2019:
Grant revenue from external customers										$	224	$	—	$	—		$	224
Inter-geographic revenues										—		477		(477		)	—
Revenues										$	224	$	477	$	(477	)	$	224

Three Months Ended September 30, 2018:
Grant revenue from external customers										$	76	$	—	$	—		$	76
Inter-geographic revenues										—		410		(410		)	—
Revenues										$	76	$	410	$	(410	)	$	76

Nine Months Ended September 30, 2019:
Net revenues from external customers	$	223	$	—	$	—		$	223	$	666	$	—	$	—		$	666
Inter-geographic revenues	—		324		(324		)	—		—		1,313		(1,313		)	—
Net revenues	$	223	$	324	$	(324	)	$	223	$	666	$	1,313	$	(1,313	)	$	666

Three Months Ended September 30, 2016:
Nine Months Ended September 30, 2018:
Net revenues from external customers	$	473	$	—	$	—		$	473	$	421	$	—	$	—		$	421
Inter-geographic revenues	—		247		(247		)	—		—		1,050		(1,050		)	—
Net revenues	$	473	$	247	$	(247	)	$	473	$	421	$	1,050	$	(1,050	)	$	421

Nine Months Ended September 30, 2017:
Net revenues from external customers	$	840	$	—	$	—		$	840
Inter-geographic revenues	—		857		(857		)	—
Net revenues	$	840	$	857	$	(857	)	$	840

Nine Months Ended September 30, 2016:
Net revenues from external customers	$	818	$	��	$	—		$	818
Inter-geographic revenues	—		674		(674		)	—
Net revenues	$	818	$	674	$	(674	)	$	818

Foreign revenue is based on the country in which the Company’s subsidiary that earned the revenue is domiciled. During the three and nine months ended September 30, ~~2017,~~2019, the Company's grant revenue ~~earned~~ from the ~~Company’s Camelina grants with the U.S. Department~~Michigan State University ("MSU") sub-award of ~~Energy totaled $223~~$224 and ~~$810, respectively, and~~$666 represented 100% ~~and 96%, respectively,~~ of total ~~revenue.~~revenue for both periods. During the three and nine months ended September 30, ~~2016,~~2018, revenue earned from the ~~Company's Camelina grants totaled $304~~MSU sub-award of $76 and ~~$649,~~$312, respectively represented 100% and ~~represented 64% and 79%~~74% of total grant revenue, ~~respectively, for both periods.~~respectively.

The geographic distribution of the Company’s long-lived assets is summarized as follows:

U.S. Canada Eliminations Total
September 30, 2017 $ 1,581
$ 6
$ —
$ 1,587
December 31, 2016 $ 1,739
$ —
$ —
$ 1,739

~~10. LICENSE AGREEMENTS AND RELATED PARTIES~~

The Company previously licensed certain technology to Tepha, Inc., a related party, for use in medical applications. During May 2016, the Company entered into an amendment to its license agreement with Tepha, in which the Company received a lump sum payment of $2,000 in consideration for an early buyout of all future royalties under the agreement and the licensing of two additional production strains and related intellectual property. The Company completed delivery of the technology to Tepha during the quarter ended September 30, 2016. As a result of this buyout, no further Tepha royalty or licensing revenue has been or will be earned by the Company after September 2016. During the three and nine months ended September 30, 2016, the Company recorded license and royalty revenue from Tepha of $494 and $2,272, respectively. As of December 31, 2016, the Company had $1 of outstanding receivables due from Tepha.

The patents underlying this license agreement are now owned by CJ. As a consequence of this sale and the Company's discontinuation of its biopolymer operations, license fee and royalty revenue is included within income from discontinued operations within the Company's condensed consolidated statements of operations contained in this Quarterly Report.



	U.S.		Canada		Eliminations		Total
September 30, 2019	$	1,228	$	19	$	—	$	1,247
December 31, 2018	$	1,372	$	13	$	—	$	1,385

11. CAPITAL STOCK

Common Stock

~~On July 7, 2017,~~March 18, 2019, the Company completed ana registered direct offering of its ~~securities.~~common stock. Proceeds from the transaction were approximately ~~$1,966, net of estimated~~$2,932, before issuance costs of ~~$317.~~$349. Investors participating in the transaction purchased a total of ~~570,784~~2,421,662 shares of common stock at a price of ~~$4.00~~$1.2101 per ~~share and an equal number~~share.

Preferred Stock

The Company's Certificate of ~~warrants with an exercise price~~Incorporation authorizes it to issue up to 5,000,000 shares of $5.04 per share, exercisable beginning on the six-month anniversary of the date of issuance. The warrants expire on the sixth anniversary of the date that they become exercisable. The Company reviewed the accounting guidance for warrants and has determined that the warrants should be recorded as equity within additional paid-in capital at September 30, 2017.$0.01 par value preferred stock.

~~On May 26,~~In December 2017, the Company ~~effected~~closed on a ~~1-for-10 reverse stock split~~public offering of its ~~common stock. The ratio for the reverse stock split~~securities that included issuance of 3,987 shares of Series A Convertible Preferred Stock. Each preferred share was ~~determined by the Company's board of directors following approval by stockholders~~convertible, at the ~~Company's annual meeting held on May 24, 2017. The reverse stock split reduced the number of~~holder's option, into 445 shares of ~~the Company's~~ common stock ~~outstanding~~ at ~~the time~~a conversion price of $2.25 per share. As of March 19, 2018, all of the ~~reverse stock split from approximately 28.7 million~~3,987 preferred shares to approximately 2.9 million shares. Proportional adjustments were made to the Company's outstanding stock options and restricted stock units and to the number of shares issued and issuable under the Company's equity compensation plans. The number of authorized shares of the Company's common stock remained at 250 million shares.

In connection with the wind down of biopolymer operations, the Company ceased pilot production of biopolymer material at its third-party biopolymer pilot production facilities. In September 2016, the Company entered into an early termination agreement with the owner-operator of one of the biopolymer production facilities. As part of the consideration for the early termination, the Company issued 27,500 unregistered shares of Yield10 Bioscience common stock (see Note 12).

~~In October 2015, the Company entered into a common stock purchase agreement with Aspire under which Aspire was committed to purchase, at the Company's direction, up~~had been converted to an aggregate of ~~$20,000 of~~1,772,000 shares of ~~Company~~ common stock. When converted, the shares of converted Series A Convertible Preferred Stock were restored to the status of authorized but unissued shares of preferred stock, over a 30 month period. Aspire purchase transactions would have utilized pricing formulas that qualify them as variable rate transactions, as defined in the securities purchase agreement entered into in connection with the Company's securities offering completed in July 2017. Because variable rate transactions are prohibitedsubject to reissuance by the ~~securities agreement entered into in conjunction with the Company's July 7, 2017 offering, the Aspire facility is no longer available to the Company as a source~~Board of capital. During the nine months ended September 30, 2017, the Company wrote off its deferred equity offering costs of $622 related to the Aspire agreement since the Company no longer intends to pursue transactions under this agreement. Expense related to this write off of deferred equity offering costs are included within general and administrative expense for the nine months ending September 30, 2017, within the Company's condensed consolidated statements of operations included herein.Directors.

~~Common Stock~~ Warrants

The following table summarizes information with regard to outstanding warrants to purchase common stock as of September 30, ~~2017:~~

2019:


Issuance	Number of Shares Issuable Upon Exercise of Outstanding Warrants	Exercise Price		Expiration Date	Number of Shares Issuable Upon Exercise of Outstanding Warrants	Exercise Price		Expiration Date
June 2015 Private Placement	393,300	$	39.80	June 15, 2019
July 2017 Registered Direct Offering	570,784	$	5.04	January 7, 2024	570,784	$	5.04	January 7, 2024
December 2017 Public Offering - Series A					6,439,000	$	2.25	December 21, 2022
Consultant	30,000	$	2.90	September 11, 2024	30,000	$	2.90	September 11, 2024
Total	994,084				7,039,784

On June 15, 2019, 393,300 warrants issued in connection with the Company's private placement of securities on June 15, 2015, expired in accordance with the terms of the securities purchase agreement.

Reserved Shares

The following shares of common stock ~~shares~~ were reserved for future issuance upon exercise of stock options, ~~release~~vesting of RSUs and conversion of warrants:

September 30, 2017 December 31, 2016
Stock Options 626,185
605,077
RSUs 14,367
21,735
Warrants 994,084
393,300
Total number of common shares reserved for future issuance 1,634,636
1,020,112

~~Preferred Stock~~

The Company's Amended and Restated Certificate of Incorporation, as amended, authorizes it to issue up to 5 million shares of $0.01 par value preferred stock. As of September 30, 2017 and December 31, 2016, no preferred stock was issued or outstanding.

~~12. RESTRUCTURING~~

In July 2016, the Company announced a strategic restructuring under which Yield10 Bioscience became its core business and its biopolymer operations were discontinued. As part of its strategic restructuring, the Company reduced staffing levels to twenty full-time employees as of December 31, 2016, and in January 2017, the Company formally changed its name to Yield10 Bioscience, Inc. For further discussion of this strategic shift see Note 13 included herein.

In connection with the wind down of biopolymer operations, the Company also ceased pilot production of biopolymer materials and reached agreements with the owner-operators of its biopolymer production facilities regarding the termination of these services. Through September 30, 2017, the Company made cash payments of $2,528, issued 27,500 shares of company common stock with a fair value of $85 and transferred certain biopolymer-related production equipment with a net book value of $111 to settle a portion of these agreements and other restructuring activities. At September 30, 2017, remaining cash restructuring costs are estimated to be $789.

Biopolymer Production Agreements Employee Severance and Related Costs Total
Aggregate Charges and Amounts Accrued $ 2,641
$ 872
$ 3,513
Paid in Cash (1,717 ) (811 ) (2,528 )
Paid through Stock and Equipment (196 ) —
(196 )
Ending Balance Accrued at September 30, 2017 $ 728
$ 61
$ 789

With the exception of approximately $226 of the $872 in employee severance and related costs incurred for non-biopolymer employees, total restructuring costs shown in the table were classified within discontinued operations in the Company's condensed consolidated statement of operations during the year ended December 31, 2016. Amounts related to the biopolymer production agreements are included within research and development expenses as shown in Note 13.

~~13. DISCONTINUED OPERATIONS~~

In July 2016, the Company announced a strategic restructuring plan under which Yield10 Bioscience became its core business. Yield10 Bioscience discontinued its biopolymer operations and eliminated positions in both its biopolymer operations and corporate organization.

As part of this strategic shift, the Company completed the sale of its biopolymer intellectual property and certain equipment and inventory to an affiliate of CJ during September 2016. The $10,000 purchase price paid by CJ was primarily for the acquisition of intellectual property, including the Company’s PHA strains, patent rights, know-how and its rights, title and interest in certain license agreements. None of this intellectual property was previously capitalized to the Company’s balance sheet. As such, the transaction resulted in a gain on the sale of approximately $9,868, net of the book value of the equipment sold. In addition to the CJ purchase, other parties acquired various capital equipment of the biopolymer operation for a total purchase price of approximately $428, resulting in a net loss on sale of this equipment of approximately $35.

~~After 2016, the Company has not had and is not expected to have further significant involvement in the operations of the discontinued biopolymer business.~~

~~The following are the operating items comprising income from discontinued operations for the three and nine months ended September 30, 2016.~~

Three Months Ended September 30, Nine Months Ended September 30,
2016 2016

Total revenue $ 1,818
$ 4,940
Costs and expenses:
Cost of product revenue 464
702
Research and development 3,793
9,438
Selling, general and administrative 510
1,429
Net gain on sale of biopolymer assets (9,833 ) (9,833 )
Total costs and expenses (5,066 ) 1,736
Other (income) or expense 31
—
Income from discontinued operations 6,853
3,204
Income tax expense (1,259 ) (1,259 )
Total income from discontinued operations $ 5,594
$ 1,945

~~The following are the non-cash operating items related to discontinued operations for the three and nine months ended September 30, 2016.~~

Three Months Ended September 30, Nine Months Ended September 30,
2016 2016
Non-cash operating items:
Depreciation $ 111
$ 327
Charge for 401(k) company common stock match $ 5
$ 125
Stock-based compensation $ 16
$ 214
Inventory impairment $ 199
$ 199
Non-cash income tax expense $ 1,259
$ 1,259
Non-cash restructuring expense paid through stock and equipment $ 196
$ 196
Gain on sale of discontinued operation and property and equipment $ (9,833 ) $ (9,833 )

Investing items:
Purchases of property and equipment $ 15
$ 193



	September 30, 2019	December 31, 2018
Stock Options	2,484,475	1,745,037
RSUs	—	7,101
Warrants	7,039,784	7,433,084
Total number of common shares reserved for future issuance	9,524,259	9,185,222

12.SUBSEQUENT EVENT

Lease Amendment

On November 6, 2019, the Company amended its lease for its Woburn, Massachusetts headquarters pursuant to which the Company agreed to vacate 7,553 square feet of excess space, returning the space to the landlord in February 2020. Reductions in lease expense, including rent and tenant related expenses, are estimated to be approximately $0.4 million on an annualized basis.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

(All dollar amounts are stated in thousands)

~~Forward Looking~~Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as ~~amended.~~amended (the "Exchange Act"). These statements relate to our future plans, objectives, expectations and intentions and may be identified by words such as “may,” “will,” “should,” “expects,” “plans,” “anticipate,” “intends,” “target,” “projects,” “contemplates,” “believe,” “estimates,” “predicts,” “potential,” and “continue,” or similar words.

Although we believe that our expectations are based on reasonable assumptions within the limits of our knowledge of our business and operations, ~~the~~these forward-looking statements contained in this document are neither promises nor guarantees. Our business is subject to significant risk and uncertainties and there can be no assurance that our actual results will not differ materially from our expectations. These forward looking statements include, but are not limited to, statements concerning our business plans and strategies; ~~the expected results of our strategic restructuring to focus on Yield10 Bioscience as our core business;~~ expected future financial results and cash requirements; plans for obtaining additional ~~funding;~~funding, including in connection with the registered offering on Form S-1 anticipated to be completed in the fourth quarter of 2019; plans and expectations that depend on our ability to continue as a going concern; and plans for development and commercialization of our Yield10 technologies. Such forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated including, without limitation, risks related to our limited cash resources, uncertainty about our ability to secure additional funding, risks related to the execution of our business plans and strategies, risks associated with the protection and enforcement of our intellectual property rights, as well as other risks and uncertainties set forth under the caption "Risk Factors" in Part ~~II,~~I, Item 1A, of ~~this Quarterly~~the Company's Annual Report on Form ~~10-Q~~10-K for the year ended December 31, 2018 and in our other filings with the ~~Securities and Exchange Commission.~~SEC.

The forward-looking statements and risk factors presented in this document are made only as of the date hereof and we do not intend to update any of these risk factors or to publicly announce the results of any revisions to any of our forward-looking statements other than as required under the federal securities laws.

Unless the context otherwise requires, all references in this Quarterly Report on Form 10-Q to "Yield10 Bioscience," "Yield10," "we," "our," "us," "our company" or "the company" refer to Yield10 Bioscience, Inc., a Delaware corporation, and its subsidiaries.

Overview

Yield10 Bioscience, Inc. is an agricultural bioscience company ~~focusing on~~which uses its "Trait Factory" to develop high value seed traits for the ~~development of new technologies~~agriculture and food industries. Specifically, Yield10 plans to efficiently develop superior gene traits for the major grain crops corn, soybean, canola, wheat and rice that will enable step-change increases in crop yield of at least 10-20 percent. While maintaining our focus on the development of novel yield traits for key crops based on a licensing model, we have recently begun to ~~enhance~~execute the second part of our strategy which is to develop independent business opportunities for Yield10 in the specialty oils and niche crop space using the oilseed Camelina. The target of this effort is sustainable business solutions to support agriculture, global food ~~security. We consider 10-20 percent increases~~production and other specialty applications. Yield10 brings a unique history, skill set, and tools captured in our Gene Ranking Artificial Intelligence Network ("GRAIN") platform for developing advanced crop ~~yield~~traits and increasing the concentration of specific biochemicals of commercial interest in crops. Our plan is to ~~be step-change increases. According to~~develop a ~~United Nations report, food production must be increased by over 70 percent~~source of revenue from funded research and development collaborations for traits, products and crops not being directly pursued internally. While there is no guarantee of success, the Company is currently engaged in a range of discussions with third parties on different crops, traits and products in the ~~next 35 years to~~ feed, the growing global population, which is expected to increase from 7 billion to more than 9.6 billion by 2050. During that time period, there will be a reduction in available arable land as a result of infrastructure growth and increased pressure on scarce water resources. Harvestable food production per acre and per growing season must be increased to meet this demand. At the same time, in light of the increasing focus on health and wellness, food safety and sustainability in developed countries, we anticipate a rise in demand for new varieties of food and food ingredients with improved nutritional properties. Further, concerns about food safety have led to the concept of “seed to plate,” with a focus on stringent quality control along the entire value chain. If this concept takes hold with consumers, it is likely to require identity preservation from seed to harvest and involve contract farming. This concept has been initially implemented in agriculural biotech, in products such as high oleic canola and soybean. Consumer demand for identity preserved specialty ingredients is also expected to rise, and we believe that Yield10's crop yield technologies and crop gene editing platform could be useful in this emerging field.

Yield10 is using two proprietary advanced biotechnology trait gene discovery platforms to improve fundamental crop yield through enhanced photosynthetic carbon capture and increased carbon utilization efficiency to increase seed yield. These platforms are based on the principle that plants which capture and utilize carbon more efficiently will enable more robust crops capable of increased seed yield. Yield10 is working to develop, translate and demonstrate the commercial value of new genetically engineered yield trait genes, identified in our discovery platforms, in major crops and to identify additional genome editing targets for improved crop performance in several key food and feed crops, including canola, soybean, rice and corn.pharmaceutical sectors. Yield10 Bioscience is headquartered in Woburn, Massachusetts and has an ~~additional agricultural science facility with greenhouses~~oilseed development Center of Excellence in Saskatoon, Saskatchewan, Canada.

~~Yield10 Bioscience was founded as~~Metabolix, Inc. in 1992 and originally focused on redirecting carbon flow in living systems to produce bioplastics and biobased chemicals. In 1997, Metabolix started a crop science research program with the intent to produce the microbial bioplastic polyhydroxybutyrate ("PHB") in high concentration in the seeds of oilseed crops or in the leaves of biomass crops where it acts as an additional carbon sink or carbon store. As we made progress on our crop program, we learned that the rate of carbon supply from photosynthesis was a bottleneck to the effective utilization of carbon, and we initiated a series of exploratory programs to develop new technologies to fundamentally increase the plants’ ability to fix and capture more carbon. These early research programs resulted in the establishment of our crop yield trait gene discovery platforms and the identification of a series of promising proprietary yield trait genes. In our work to date, our team has demonstrated step-change yield increases in Camelina seed production and in switchgrass biomass production. We are currently progressing the development of our lead yield trait genes in canola, soybean and rice to provide step-change yield solutions for enhancing global food security.

Based on encouraging early results from these gene discovery programs, we refocused our crop science efforts to yield improvement in major food and feed crops in 2015 and rebranded the effort as Yield10 Bioscience. In 2016, we sold our biopolymers assets and restructured the Company around our crop science mission. In January 2017, we completed this transition and changed the name of the company to Yield10 Bioscience, Inc.

In connection with our restructuring, we initiated actions during July 2016 to significantly reduce our workforce and cease pilot biopolymer production in an effort to significantly reduce our ongoing cash burn rate. During September 2016, we completed the sale of our biopolymer intellectual property and certain equipment and inventory to an affiliate of CJ CheilJedang Corporation ("CJ") for a total purchase price of $10,000. In winding down its biopolymer operations, the Company also ceased pilot production of biopolymer materials and reached agreements with the owner-operators of its biopolymer production facilities regarding the termination of these services. Through September 30, 2017, we made cash payments of $2,528, issued 27,500 shares of common stock with a fair value of $85 and transferred certain biopolymer-related production equipment with a net book value of $111 to settle a portion of these agreements and other restructuring activities. Remaining cash restructuring costs are estimated to be approximately $789, and are expected to be paid out through May 2018.

~~On July 7, 2017, we completed an offering of our securities and deposited net proceeds from the transaction of approximately $1,966.~~ As of September 30, ~~2017, we~~2019, the Company held unrestricted cash, ~~and~~ cash equivalents and short-term investments of $2,951. As a result of the funds acquired in the July transaction, we anticipate that our current cash resources will be sufficient to fund operations and meet our obligations, including our remaining restructuring obligations, when due, into the first quarter of 2018. This forecast of cash resources is forward-looking information that involves risks and uncertainties, and the actual amount of expenses could vary materially and adversely as a result of a number of factors.$2,877. We ~~have evaluated~~follow the guidance of ASU 2014-15, Presentation of Financial Statements-Going Concern (Subtopic 205-40) in order to determine whether there is substantial doubt about ~~our~~the Company's ability to continue as a going concern for one year after the date ~~our~~its financial statements are ~~issued. Our~~filed. The Company's ability to continue operations after ~~our~~its current cash resources are exhausted depends on ~~our~~its ability to obtain additional financing through, among other sources, public or private equity financing, secured or unsecured debt financing, equity or debt bridge financing, additional government research grants or collaborative arrangements with third parties, as to which no assurances can be given. We do not know whether additional financing will be available on terms favorable or acceptable to usthe Company when needed, if at all. If adequate additional funds are not available when required, ~~or if~~ we ~~are unsuccessful in entering collaborative arrangements for further research, we may~~will be forced to curtail our research efforts, explore strategic alternatives and/or wind down our operations and pursue options for liquidating our remaining assets, including intellectual property and equipment. Based on our cash forecast, we have determined that ~~our~~the Company's present capital resources are not sufficient to fund our planned operations for a ~~twelve month~~twelve-month period ~~from the date that our financial statements are issued,~~ending in November 2020, and therefore, raise substantial doubt about our ability to continue as a going concern.

~~Over~~If we issue equity or debt securities to raise additional funds, (i) we may incur fees associated with such issuance, (ii) our existing stockholders may experience dilution from the ~~last 21 months,~~issuance of new equity securities, (iii) we may incur ongoing interest expense and be required to grant a security interest in Company assets in connection with any debt issuance, and (iv) the new equity or debt securities may have ~~consolidated~~rights, preferences and privileges senior to those of our ~~crop science intellectual property position with approximately 14 patent filings in prosecution, identified~~existing stockholders. In addition, utilization of the Company’s net operating loss and research and development credit carryforwards may be subject to significant annual limitations under Section 382 of the Code due to ownership changes resulting from equity financing transactions. If we raise additional ~~novel gene targets for improving crop performance and yield~~funds through ~~genetic engineering~~collaboration, licensing or genome editing, formed a scientific advisory board with leaders in plant science, conducted several greenhouse studies and conducted our first Fast Field Testing of traits from our “Smart Carbon Grid for Crops” discovery platform. We have reported encouraging data for our lead yield trait gene, C3003 in Camelina from greenhouse and field tests andother similar arrangements, it may be necessary to relinquish valuable rights to the Company's potential products or proprietary technologies or grant licenses on terms that are ~~conducting additional studies in Camelina, canola, soybean and rice.~~

not favorable to the Company.

Government Grants

During 2018 we entered into a sub-award with Michigan State University ("MSU") to support a Department of Energy ("DOE") funded grant entitled "A Systems Approach to Increasing Carbon Flux to Seed Oil." Our ~~principal sources~~participation under this projected five-year grant will be awarded on an annual basis with the first year commencing September 15, 2017. Although our funding under this sub-award has been appropriated through September 2020 for $1,698, we anticipate that each additional option year will be awarded annually to Yield10 through September 14, 2022 for total sub-award funding of ~~revenue~~$2,957, provided the U.S. Congress continues to appropriate funds for the program, we are ~~government research grants.~~ able to make progress towards meeting grant objectives and we remain in compliance with other terms and conditions of the sub-award.

As of September 30, ~~2017, expected gross~~2019, proceeds of ~~$3,422~~$614 remain to be ~~received~~recognized under our ~~U.S. government grants. Included~~MSU sub-award as shown in ~~this amount is a sub-award of $2,957 awarded to~~ the Company in September 2017 for a new grant with the Department of Energy to conduct research aimed at boosting oilseed yield in Camelina, a promising biofuel crop. We anticipate that we will begin working on this five-year grant during our fourth quarter of 2017.table below. This includes amounts for reimbursement to our subcontractors, as well as reimbursement for our employees’ time, benefits and other expenses related to future performance.

~~The status of our government grants is as follows:~~

Program Title
Funding
Agency
Total Government Funds
Total received
through

Remaining amount
available as of

Grant
Expiration
September 30, 2017 September 30, 2017
Subcontract from Michigan State University project funded by DOE entitled "A Systems Approach to Increasing Carbon Flux to Seed Oil" Department of Energy $ 2,957
$ —
$ 2,957
October 2022
Production of High Oil, Transgene Free Camelina Sativa Plants through Genome Editing ("Camelina") Department of Energy 1,997
1,532
465
September 2018
Subcontract from NC State University (NCSU) project funded by DOE ARPA-E entitled "Jet Fuel from Camelina Sativa: A Systems Approach" Department of Energy 276
276
—
March 2017
Total $ 5,230
$ 1,808
$ 3,422

Program Title

Funding

Agency

Total Government Funded Appropriations

Total revenue recognized through September 30, 2019

Remaining amount to be recognized as of September 30, 2019

Contract/Grant

Expiration

Subcontract from Michigan State University project funded by DOE entitled "A Systems Approach to Increasing Carbon Flux to Seed Oil"

Department of Energy

1,698

1,084

614

September 2020

Critical Accounting Estimates and Judgments

The discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with ~~accounting principles generally accepted in the United States of America (“GAAP”)~~GAAP for interim financial information. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, stock-based compensation, measurement of right-of-use assets and ~~strategic restructuring charges.~~lease liabilities and the recognition of lease expense. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. ~~The~~With the exception of our accounting for operating leases under the new guidance of Topic 842, Leases, that became effective for us on January 1, 2019, the critical accounting policies and the significant judgments and estimates used in the preparation of our condensed consolidated financial statements for the three and nine months ended September 30, ~~2017,~~2019, are consistent with those discussed in our Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2018, in the section captioned “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates and Judgments.”

Results of Operations

Comparison of the Three Months Ended September 30, ~~2017~~2019 and ~~2016~~

2018

Revenue

Three Months Ended
September 30,
2017 2016 Change
Grant revenue $ 223
$ 473
$ (250 )



	Three Months Ended September 30,
	2019		2018		Change
Grant revenue	$	224	$	76	$	148

Grant revenue ~~from continuing operations~~ was ~~$223~~$224 and ~~$473~~$76 for the three months ended September 30, ~~2017~~2019 and ~~2016,~~September 30, 2018, respectively. Grant revenue for the three months ended September 30, ~~2017 were~~2019 and September 30, 2018 was derived solely from the Company's ~~Camelina~~sub-award with MSU.

We have been able to apply more resources during 2019 to the MSU sub-award than earlier anticipated resulting in greater revenue recognition than previously forecast. As a result, we believe that grant revenue recognized during the remainder of 2019 from our DOE sub-award with MSU will continue at levels above grant revenue recognized during 2018.

Expenses



	Three Months Ended September 30,
	2019		2018		Change
Research and development expenses	$	1,232	$	1,335	$	(103	)
General and administrative expenses	990		1,417		(427		)
Total expenses	$	2,222	$	2,752	$	(530	)

Research and Development Expenses

Research and development expenses during the ~~Department~~three months ended September 30, 2019 and September 30, 2018 were $1,232 and $1,335, respectively. The 8 percent decrease of ~~Energy (DOE).~~$103 is primarily due to reduced compensation and benefit expense and lower licensing costs. Compensation and benefit expense decreased as a result of a decrease in stock compensation expense of $82 and a decrease in bonus expense of $41 during the three months ended September 30, 2019, partially offset by an increase in employee payroll of $64 from the addition of new headcount. We did not accrue for 2019 employee bonuses during the three months ended September 30, 2019. During the three months ended September 30, ~~2016, grant revenue consisted~~2018, we incurred a licensing charge of ~~$304 earned from~~$33 for a technology research license that did not reoccur during the ~~Camelina grant~~current period.

Based on our current financial forecasts, we expect total research and ~~$169 earned from the Company's subcontract~~development expenses for 2019 will remain consistent with ~~North Carolina State University.~~

~~We anticipate grant revenue will decline~~2018, provided that we are able to raise additional funds to support our ongoing operations. Our forecasts related to research and development expenses are subject to significant change as events and opportunities occur during the remainder of ~~2017~~2019 that could result in modifications to our business plans.

General and into early 2018 as we near completion of the the Company's Camelina grant with the DOE. Our new five-year DOE sub-award through Michigan State University is not expected to generate quarterly revenue at the same rate as the previous Camelina grant.

Administrative Expenses

Three Months Ended
September 30,
2017 2016 Change
Research and development expenses $ 1,132
$ 1,547
$ (415 )
General and administrative expenses 1,073
1,530
(457 )
Total expenses $ 2,205
$ 3,077
$ (872 )

~~Research~~General and ~~Development Expenses~~

~~Research and development~~administrative expenses ~~from continuing operations were $1,132 and $1,547~~ for the three months ended September 30, ~~2017~~2019 and ~~2016, respectively.~~September 30, 2018 decreased by $427 from $1,417 to $990. The ~~decrease of $415~~change is ~~primarily~~partially due to a decrease in ~~research facility~~compensation and benefits of $215, as a result of lower stock compensation and bonus expenses. ~~Research facility expenses decreased by $293 from $545~~The Company did not accrue for 2019 employee bonuses during the three months ended September 30, ~~2016 to $252~~2019. Facility expense also decreased by $221 as a result of an impairment charge of $255 taken on the Company's Lowell facility during ~~the three months ended September 30, 2017,~~August 2018 as a result of its discontinued use.

Based on our current financial forecasts, we expect general and administrative expenses during 2019 will remain below 2018 expenses, primarily as a result of ~~the relocation~~lower stock compensation expense, and provided that we are able to raise additional funds to support our ~~new, and less expensive, Woburn, Massachusetts facility.~~

We anticipate that our research and development expenses will continue at their current levels for the remainder of 2017 and into early 2018 as a result of the Company reaching a stable cost structure after completion of its 2016 restructuring.

~~General and Administrative Expenses~~

~~General and administrative expenses from continuing operations were $1,073 and $1,530 for the three months ended September 30, 2017 and 2016, respectively. The decrease of $457 was primarily due~~ongoing operations. Our forecasts related to reductions in salaries and benefits, professional service fees and facility expenses. Salaries and benefits decreased by $164 from $730 during the three months ended September 30, 2016 to $566 during the three months ended September 30, 2017, primarily as a result of the Company's 2016 restructuring that eliminated a number of administrative positions. Professional service fees decreased by $135 from $386 during the three months ended September 30, 3016 to $251 during the three months ended September 30, 2017, primarily as a result of the Company's change to a new independent accounting firm and a reduction in accounting related activities during the quarter ended September 30, 2017 in comparison to the same quarter of the previous year. Facility expenses decreased by $97 from the same period a year ago due to the Company's move to its Woburn facility.

~~We anticipate that our~~ general and administrative expenses ~~will continue at their current levels for~~are subject to significant change as events and opportunities occur during the remainder of ~~2017 and into early 2018 as a~~2019 that could result ~~of the Company reaching a stable cost structure after completion of its 2016 restructuring.~~

in modifications to our business plans.

Other Income (Expense), Net

Three Months Ended
September 30,
2017 2016 Change
Total other income (expense), net $ (43 ) $ (8 ) $ (35 )



	Three Months Ended September 30,
	2019		2018		Change
Total other income (expense), net	$	16	$	38	$	(22	)

Other income (expense), net, ~~reflects net expense of $43~~was $16 and $8$38 for the three months ended September 30, ~~2017~~2019 and 2016, respectively. The net expense during the third quarter of 2017 is primarily the result of imputed interest charges recorded in connection with payments being made by the Company through May 2018 related to the early termination of a third party manufacturing agreement.

~~Income Tax Benefit~~

~~For the three months ended~~ September 30, ~~2016,~~2018, respectively. Net other income during each period was primarily derived from investment income earned from the Company recognized an income tax benefit within continuing operations of $1,042 and tax expense within discontinued operations of $1,259 related to taxable income generated during the interim period as a result of selling the assets of our biopolymer operations to CJ.Company's short-term investments.

~~Discontinued Operations~~

In July 2016, our Board of Directors approved a restructuring plan under which Yield10 Bioscience became our core business with a focus on developing disruptive technologies for step-change improvements in crop yield to enhance global food security. As a result of this strategic shift, we completed the sale of our biopolymer intellectual property and certain equipment and inventory to an affiliate of CJ during September 2016. We determined that the sale of our biopolymer assets and operations represented a transaction, under current accounting guidance, that met the requirements for discontinued operations reporting, and as such, the financial results of the biopolymer operations have been reflected as discontinued operations for the three months ended September 30, 2016.

~~During the three months ending September 30, 2017 and 2016, we recognized net income before income taxes from discontinued operations of $0 and $6,853, respectively.~~

Comparison of the Nine Months Ended September 30, ~~2017~~2019 and ~~2016~~

2018

Revenue

Nine Months Ended September 30,
2017 2016 Change
Grant revenue $ 840
$ 818
$ 22



	Nine Months Ended September 30,
	2019		2018		Change
Grant revenue	$	666	$	421	$	245

Grant revenue ~~from continuing operations~~ was ~~$840~~$666 and ~~$818~~$421 for the nine months ended September 30, ~~2017~~2019 and ~~2016,~~September 30, 2018, respectively. Grant revenue for the nine months ended September 30, ~~2017 were~~2019 was derived ~~primarily from $810 earned~~solely from the Company's ~~Camelina grant~~sub-award with ~~DOE.~~MSU. During the nine months ended September 30, ~~2016, grant revenue consisted of $649~~2018, $312 was earned from the MSU sub-award with the remainder earned from our Camelina grant ~~and $169 earned from~~with the ~~Company's subcontract with North Carolina State University.~~DOE that completed in 2018.

Expenses


	Nine Months Ended September 30,							Nine Months Ended September 30,
	2017		2016		Change			2019		2018		Change
Research and development expenses	$	3,379	$	4,522	$	(1,143	)	$	3,646	$	3,696	$	(50	)
General and administrative expenses	4,215		4,951		(736		)	3,201		4,149		(948		)
Total expenses	$	7,594	$	9,473	$	(1,879	)	$	6,847	$	7,845	$	(998	)

Research and Development Expenses

Research and development expenses ~~from continuing operations were $3,379 and $4,522~~ for the nine months ended September 30, ~~2017~~2019 and ~~2016, respectively. The~~nine months ended September 30, 2018 remained consistent with a small $50, or 1 percent decrease ~~of $1,143 is primarily due to decreases in research facility and~~between the two periods. During the nine months ended September 30, 2019, however, employee compensation and ~~related benefit expenses. Research facility expenses~~benefits decreased by ~~$813~~$109 as a result of lower stock compensation expense of $202 and a decrease in bonus expense of $125. These decreases were partially offset by an increase in employee payroll of $197 from ~~$1,533~~the addition of headcount. We did not accrue for 2019 employee bonuses during the nine months ended September 30, ~~2016 to $720 during~~2019. During the nine months ended September 30, ~~2017,~~2019, external research services expense increased by $86, primarily as a result of the relocation to our new Woburn, Massachusetts facility. Employee compensation and related benefit expenses were $1,733 and $2,019 for the nine months ended September 30, 2017 and 2016, respectively. The decrease of $286expanded crop trials conducted during the 2017 nine month period is primarily attributable to decreases in headcount resulting from our 2016 restructuring. Sponsored research expenses offset a portion of these favorable variances, increasing by $166 to $401 during the nine months ended September 30, 2017 from $235 during the nine months ended September 30, 2016, primarily in connection with our use of third-party research and crop field trial support.

current year.

General and Administrative Expenses

General and administrative expenses decreased by $948 from ~~continuing operations~~$4,149 during the nine months ended September 30, 2018 to $3,201 during the nine months ended September 30, 2019. The 23 percent decrease was primarily due to a net decrease in compensation and benefits, a decrease in professional fees and a reduction in facility expenses of $571, $112, and $249, respectively. The favorable variance in net compensation and benefits is primarily the result of lower stock compensation and bonus expenses. Stock compensation expense decreased by $344 during the nine months ended September 30, 2019 due to the final vesting and expense recognition for a significant number of employee stock options that completed vesting during October 2018. No employee bonuses were ~~$4,215 and $4,951~~accrued during the nine months ended September 30, 2019, in contrast to $223 in bonus expense accrued for the nine months ended September 30, 2017 and 2016, respectively. The decrease of $736 was primarily due to decreased employee compensation and related benefit expenses and a reduction in professional service fees, partially offset by the recognition of $622 of deferred equity offering costs related to a common stock purchase agreement with Aspire Capital Fund, LLC ("Aspire"). Employee compensation and related benefit expenses were $1,658 and $2,515 for the nine months ended September 30, 2017 and 2016, respectively. The $857 decrease in employee compensation and related benefits is due primarily to the Company's restructuring completed during 2016 that eliminated a number of administrative positions.2018. Professional ~~service~~ fees decreased ~~by $151 from $1,088~~ during the nine months ended September 30, ~~2016 to $937 during the nine months ended September 30, 2017. This decrease is primarily the result of our change in accounting firms.~~

In October 2015, we entered into a common stock purchase agreement with Aspire under which Aspire was committed to purchase, at our discretion, up to an aggregate of $20,000 of shares of common stock over a 30 month period. Aspire purchase transactions would have utilized pricing formulas that qualify them as variable rate transactions, as defined in the securities purchase agreement entered into in connection with our securities offering completed in July 2017 (See Note 11 - Capital Stock). The securities purchase agreement prohibits us from issuing shares of common stock involving variable rate transactions for a period of three years from the date on which the securities purchase agreement was signed, and2019 as a result ~~the Aspire facility is no longer available to us as a source~~ of ~~capital. Since the deferred equity offering costs can no longer be offset against future common stock issuances to Aspire, we recognized the full deferral of $622 within general~~lower corporate filing fees and ~~administrative expenses during June 2017.~~

patent processing charges.

Other Income (Expense), Net

Nine Months Ended September 30,
2017 2016 Change
Total other income (expense), net $ (90 ) $ (4 ) $ (86 )



	Nine Months Ended September 30,
	2019		2018		Change
Total other income (expense), net	$	68	$	101	$	(33	)

Other income (expense), net, ~~reflects net expense~~was $68 and $101 for each of ~~$90 and $4 for~~ the nine months ended September 30, ~~2017~~2019 and 2016, respectively. The net expense during the nine months of 2017 is primarily the result of imputed interest charges recorded in connection with payments we are making through May 2018 related to the early termination of a third party manufacturing agreement.

~~Income Tax Benefit~~

~~For the nine months ended~~ September 30, ~~2016,~~2018, respectively. Net other income during each period was primarily derived from investment income earned from the Company recognized an income tax benefit within continuing operations of $1,042 and tax expense within discontinued operations of $1,259 related to taxable income generated during the interim period as a result of selling the assets of its biopolymer operations to CJ.

~~Discontinued Operations~~

~~During the nine months ending September 30, 2017 and 2016, we recognized net income before income taxes from discontinued operations of $0 and $3,204, respectively.~~

Company's short-term investments.

Liquidity and Capital Resources

Currently, we require cash to fund our working capital needs, to purchase capital assets, to pay our operating lease obligations and other operating costs. The primary sources of our liquidity have historically included equity financings, government research grants and income earned on cash and short-term investments.

Since our inception, we have incurred significant expenses related to our research, development and commercialization efforts. With the exception of 2012, when we recognized $38,885 of deferred revenue from a terminated joint venture, we have recorded losses since our initial founding, including the three and nine months ended September 30, ~~2017.~~2019. As of September 30, ~~2017,~~2019, we had an accumulated deficit of ~~$340,201.~~$358,051. Our total unrestricted cash and cash equivalents as of September 30, ~~2017,~~2019, were ~~$2,951~~$2,877 as compared to ~~$7,309~~cash, cash equivalents and short-term investments of $5,769 at December 31, ~~2016.~~2018. As of September 30, ~~2017,~~2019, we had no outstanding debt.

Our cash and cash equivalents ~~at September 30, 2017, were~~are held primarily for working capital purposes. As of September 30, ~~2017,~~2019, we had restricted cash of ~~$432.~~$332. Restricted cash consists of $307 held in connection with the lease agreement for our Woburn, Massachusetts facility and ~~$125~~$25 held in connection with our corporate credit card ~~program.~~

used for incidental purchases.

Investments are made in accordance with our corporate investment policy, as approved by our Board of Directors. The primary objective of this policy is to preserve principal and investments are limited to high quality corporate debt, U.S. Treasury bills and notes, money market funds, bank debt obligations, municipal debt obligations and asset-backed securities. The policy establishes maturity limits, concentration limits, and liquidity requirements. As of September 30, ~~2017,~~2019, we were in compliance with this policy.

~~On July 7, 2017, we completed an offering~~We currently anticipate $8,500 - $9,000 of cash usage during 2019 to fund our ~~securities. Net proceeds from the transaction were approximately $1,966. As a result of acquiring these additional funds, we anticipate~~operations. We estimate that our current cash resources will be sufficient to fund operations and meet our obligations, ~~including our restructuring obligations,~~ when due, ~~into~~through the ~~first quarter~~end of ~~2018.~~2019. This forecast of cash resources is forward-looking information that involves risks and uncertainties, and the actual amount of expenses could vary materially and adversely as a result of a number of factors. We ~~have adopted~~follow the guidance of ~~ASU No. 2014-15,~~ASC Topic 205-40, Presentation of Financial Statements-Going Concern, ~~(Subtopic 205-40)~~ in order to determine whether there is substantial doubt about ~~our~~the Company's ability to continue as a going concern for one year after the date our financial statements are issued. ~~Our~~The Company's ability to continue operations after ~~our~~its current cash resources are exhausted depends on ~~our~~its ability to obtain additional financing through, among other sources, public or private equity financing, secured or unsecured debt financing, equity or debt bridge financing, additional government research grants or collaborative arrangements with third parties, as to which no assurances can be given. We do not know whether additional financing will be available on terms favorable or acceptable to usthe Company when needed, if at all. If adequate additional funds are not available when required, ~~or if~~ we ~~are unsuccessful in entering collaborative arrangements for further research, we may~~will be forced to curtail our research efforts, explore strategic alternatives and/or wind down our operations and pursue options for liquidating our remaining assets, including intellectual property and equipment. Based on our cash forecast, we have

determined that ~~our~~the Company's present capital resources are not sufficient to fund our planned operations for a ~~twelve month~~twelve-month period ending in November 2020, and therefore, raise substantial doubt about our ability to continue as a going concern.

InOn September 9, 2019, we filed a registration statement on Form S-1 (the "Registration Statement"), as amended on October ~~2015, we entered into a~~11 and November 8, 2019. The Registration Statement, which has not yet been declared effective by the Securities and Exchange Commission, relates to an offer to sell 2,777,777 Class A Units, consisting of common stock ~~purchase agreement with Aspire Capital Fund, LLC (Aspire) under which Aspire was committed to purchase, at our direction, up to an aggregate~~and warrants and 4,000 Class B Units, consisting of ~~$20,000 of shares of our common stock over a 30 month period. Aspire purchase transactions would have utilized pricing formulas that qualify them~~Series A Convertible Preferred Stock and warrants, as ~~variable rate transactions, as defined~~more fully described in the ~~securities purchase agreement entered into in connection with~~Registration Statement. Estimated cash proceeds from the sale of the Class A and Class B Units, net of offering expenses, are estimated to be $4.4 million. The Company also intends to conduct a concurrent private placement of Series B Convertible Preferred Stock and warrants to our ~~securities~~largest shareholder for estimated net proceeds of $4.2 million, for total aggregate proceeds from the offering ~~completed in July 2017. Because variable rate transactions are prohibited by~~of approximately $8.6 million before the ~~securities purchase agreement entered into in conjunction with~~exercise of the ~~July 2017 offering, the Aspire facility is no longer~~over-allotment option available to ~~us as a source~~the underwriter of ~~capital.~~

~~During 2016, we completed a strategic restructuring of our operations to focus on~~ the Yield10 Bioscience business. We reduced staffing levels to twenty full-time employees and incurred restructuring costs for contract termination and employee post-termination benefits of approximately $3,513 which were primarily reflected in discontinued operations within our statement of operations for that year. At September 30, 2017, $789 of these restructuring charges remain outstanding, and they are reflected as liabilities in our condensed consolidated balance sheet and are expected to be paid out through May 2018. We currently anticipate that we will use approximately $8,000 - $8,500 of cash during 2017, including anticipated payments for restructuring costs. This estimated cash usage for operations is significantly less than cash used for operations of $14,700 during the year ended December 31, 2016. The reduction is primarily the result of our restructuring efforts.

We will need additional capital to fully implement our business, operating and development plans and to support our capital needs. The timing, structure and vehicles for obtaining future financing are under consideration, but thereoffering. There can be no assurance that ~~such financing efforts~~this offering of securities will ~~be successful. If~~close for the full amount we ~~do not receive additional funding during 2017, we may be forced~~are seeking to ~~wind down our business,~~raise, or ~~have to delay, scale back or otherwise modify our business plans, research and development activities and other operations, and/or seek strategic alternatives.~~at all.

If we issue equity or debt securities to raise additional funds, (i) wethe Company may incur fees associated with such issuance, (ii) our existing stockholders will experience dilution from the issuance of new equity securities, (iii) wethe Company may incur ongoing interest expense and be required to grant a security interest in ~~our~~Company assets in connection with any debt issuance, and (iv) the new equity or debt securities may have rights, preferences and privileges senior to those of our existing stockholders. In addition, utilization of our net operating loss and research and development credit carryforwards may be subject to significant annual limitations under Section 382 of the ~~Internal Revenue~~ Code ~~of 1986~~ due to ownership changes resulting from future equity financing transactions. If we raise additional funds through collaboration, licensing or other similar arrangements, it may be necessary to relinquish valuable rights to our potential products or proprietary technologies or grant licenses on terms that are not favorable to ~~us.~~

the Company.

Net cash used for operating activities was ~~$6,309~~$5,445 during the nine months ended September 30, ~~2017,~~2019, compared to net cash used for operating activities during the nine months ended September 30, ~~2016~~2018 of ~~$11,987.~~$6,731. Net cash used for operations during the nine months ended September 30, ~~2017~~2019 primarily reflects the net loss of ~~$6,844~~$6,113 and payments made to reduce the Company's lease liabilities of $622 partially offset by non-cash expenses, including stock-based compensation expense of ~~$1,063,~~$406, depreciation expense of ~~$158 and~~$150, 401(k) stock matching contribution expense of ~~$68.~~

$73 and non-cash lease expense of $456. The ~~following are the non-cash~~higher net cash usage for operating ~~items related to discontinued operations for the three and nine months ended September 30, 2016.~~

~~Net cash of $6 was used by investing~~ activities during the nine months ended September 30, 2018 of $6,731 is primarily the result of the Company's greater net loss of $7,323 and payment of 2017 ~~compared~~employee bonuses of $529, partially offset by the decrease in non-cash stock compensation of $546 during the nine months ended September 30, 2019 in comparison to ~~net~~the nine months ended September 30, 2018.

Net cash of $2,734 was provided by investing activities during the nine months ended September 30, 2016 of $9,783. During the nine months ended September 30, 2016, we received cash proceeds from the sale of our discontinued biopolymer assets of $10,317. We also transferred $187 of restricted cash to cash and cash equivalents2019 as a result of $3,746 of short-term investments reaching their maturity dates and converting to cash. The Company also purchased $1,000 of new short-term investments during the move to our new Woburn, Massachusetts facility and the termination of our Cambridge lease. During the nine months ended September 30, 2016, we also used $721 of cash for the acquisition of property and equipment to outfit the new Woburn facility.nine-month period.

Net cash of ~~$1,954~~$2,579 was provided by financing activities during the nine months ended September 30, ~~2017, compared to net cash used by financing activities~~2019 as a result of ~~$274 during~~ the ~~nine months ended September 30, 2016. During July 2017, the Company completed~~Company's completion of a registered direct sale of 2,421,662 shares of common stock at an offering price of ~~its securities. Proceeds~~$1.2101 per share during March 2019 Gross proceeds from the ~~transaction were approximately $1,966, net~~sale totaled $2,932 before cash payment of ~~estimated issuance~~offering costs of $317 (see Note 11 - Capital Stock in our Notes to the Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q). During the nine months ended September 30, 2017 and 2016, the Company paid taxes of $12 and $274, respectively, related to our net settlement of employee vested stock awards. These taxes include payment of minimum federal, state or Canadian provincial income tax withholdings associated with employee RSUs that vested during each nine month period. As RSUs vest, we withhold a number of shares with an aggregate fair market value equal to the minimum tax withholding amount from the common stock issuable at the vest date.$349.

Off-Balance Sheet Arrangements

As of September 30, ~~2017,~~2019, we had no off-balance sheet arrangements as defined in Item 303(a)(4) of the ~~Securities and Exchange Commission’s~~SEC’s Regulation S-K.

~~Related Party Transactions~~

See Note 10, "License Agreements and Related Parties," to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for a full description of our related party transactions.

Recent Accounting Pronouncements

See Note ~~3, "Recent Accounting Pronouncements,~~2, "Accounting Policies," to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for a full description of recent accounting pronouncements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

~~There have been no material changes in information regarding our exposure to market risk, as described in Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2016.~~

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

~~As of September 30, 2017, we conducted an evaluation under the supervision and with~~Our management (with the participation of our ~~management, including our Chief~~Principal Executive Officer and ~~Chief~~Principal Accounting ~~Officer regarding~~Officer) evaluated the effectiveness ~~of the design and operation~~ of our disclosure controls and procedures as(as defined in ~~Rule~~Rules 13a-15(e) and 15d-15(e) under the Exchange Act), as of ~~the Securities Exchange Act of 1934 (the "Exchange Act"). The term "disclosure~~September 30, 2019. Disclosure controls and ~~procedures" means controls and other~~ procedures ~~of a company that~~ are designed to ensure that information required to be disclosed by the ~~company~~Company in the reports ~~that~~ it files or submits under the Exchange Act is recorded, processed, summarized and reported ~~within the requisite time periods~~on a timely basis and that such ~~disclosure controls and procedures were effective to ensure that~~ information ~~required to be disclosed by the company in the reports that it files or submits under the Exchange Act~~ is accumulated and communicated to ~~its~~ management, including ~~its principal executive~~the Principal Executive Officer and ~~principal accounting officers, or persons performing similar functions,~~the Principal Accounting Officer, as appropriate, to allow timely decisions regarding ~~required~~ disclosure. Based on this evaluation, our ~~Chief~~Principal Executive Officer and ~~Chief~~Principal Accounting Officer concluded that ~~our~~these disclosure controls and procedures ~~(as defined in the Exchange Act Rules 13a-15(e) and 15d-15(e)) were not effective as of September 30, 2017 due to the material weakness in internal controls over financial reporting described below.~~

As disclosed in Item 9A of our Annual Report on Form 10-K for the year ended December 31, 2016, our management concluded that our internal control over financial reporting was not effective at December 31, 2016. As of December 31, 2016, management identified a material weakness in internal control over financial reporting related to accounting for stock option modifications.

We are ~~undertaking steps during 2017 to remediate the causes of the internal control failure related to our accounting for the stock award modification. Specifically, we are performing the following steps:~~

Our accounting staff responsible for preparing and reviewing stock based compensation will complete renewed training in the accounting for stock award modifications as provided by current accounting standards, including FASB Accounting Standards Codification Topic 718, ~~Compensation – Stock Compensation;~~

We will assess whether our licensed stock compensation software, as used by us, was a contributing cause of the error, and if limitations exist in the calculation of stock compensation expense for stock award modifications, we will develop alternative procedures to ensure the accuracy of our calculations;

~~We will undertake additional staff training to ensure that we correctly utilize the software application for future stock award modifications as appropriate; and~~

~~We will develop and implement enhanced policies, procedures and controls related to the calculation of stock based compensation when a stock award modification occurs.~~

We are committed to maintaining a strong internal control environment, and believe that these remediation efforts will represent significant improvements in our control environment. In the history of the company, stock award modifications have rarely occurred, if at all, before the ones that were recorded during the year ended December 31, 2016. In the event that we modify other stock awards, we will apply our enhanced procedures and controls to ensure a similar error does not occur.

We expect that our remediation efforts will continue through 2017, although the material weakness will not be considered remediated until the applicable internal controls operate for a sufficient period of time, and management has concluded, through testing, that these controls are operating effectively.

effective.

Changes in Internal Control over Financial Reporting

~~With the exception of the material weakness and associated remediation plan related to the calculation of stock compensation expense discussed above, there~~There have been no changes in our internal control over financial reporting ~~identified~~(as defined in ~~connection with the evaluation required by Rule 13a-15(d) of~~Rules 13a-15(f) under the Exchange Act) ~~that occurred~~ during the quarter ended September 30, ~~2017~~2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

From time to time, the Company may be subject to legal proceedings and claims in the ordinary course of business. The Company is not currently aware of any such proceedings or claims that it believes will have, individually or in the aggregate, a material adverse effect on the business, financial condition or the results of operations.

ITEM 1A. RISK FACTORS.

There have been no material changes in information regarding our risk factors as described in ~~Part II,~~ Item 1A of our ~~Quarterly~~Annual Report on Form ~~10-Q~~10-K for the ~~three and six months~~year ended ~~June 30, 2017.~~December 31, 2018, other than the updated risk factor noted below. Our business is subject to numerous risks. We caution you that the important factors annotated within our risk factors, among others, could cause our actual results to differ materially from those expressed in forward-looking statements made by us or on our behalf in filings with the ~~Securities and Exchange Commission,~~SEC, press releases, communications with investors and oral statements. Any or all of our forward-looking statements in this Quarterly Report on Form 10-Q and any other public statements we make may turn out to be wrong. They can be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties. Many factors discussed in our risk factors will be important in determining future results. Consequently, no forward-looking statement can be guaranteed. Actual future results may differ materially from those anticipated in forward-looking statements. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or ~~otherwise.~~otherwise, other than as required under the federal securities laws. You are advised, however, to consult any further disclosure we make in our reports filed with the ~~Securities~~SEC.

If we fail to continue to meet all applicable Nasdaq Capital Market requirements and ~~Exchange Commission.~~the Nasdaq Stock Market determines to delist our common stock, the delisting could adversely affect the market liquidity of our common stock, impair the value of your investment and harm our business.

Our common stock is currently listed on the Nasdaq Capital Market. In order to maintain that listing, we must satisfy minimum financial and other requirements. On June 25, 2019, we received a notice from the Listing Qualifications Department of the Nasdaq Stock Market indicating that, for the previous 30 consecutive business days, the bid price for our common stock had closed below the minimum $1.00 per share required for continued inclusion on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2). The notification letter states that pursuant to Nasdaq Listing Rule 5810(c)(3)(A) the Company will be afforded 180 calendar days, or until December 23, 2019, to regain compliance with the minimum bid price requirement. In order to regain compliance, shares of the Company’s common stock must maintain a minimum bid closing price of at least $1.00 per share for a minimum of ten consecutive business days. If we do not regain compliance by December 23, 2019, Nasdaq will provide written notification to us that our common stock will be delisted. At that time, we may appeal Nasdaq’s delisting determination to a Nasdaq Listing Qualifications Panel. Alternatively, we may be eligible for an additional 180 day grace period if we satisfy all of the requirements, other than the minimum bid price requirement, for listing on the Nasdaq Capital Market set forth in Nasdaq Listing Rule 5505.

While we intend to engage in efforts to regain compliance, and thus maintain our listing, there can be no assurance that we will be able to regain compliance during the applicable time periods set forth above. If we fail to continue to meet all applicable Nasdaq Capital Market requirements in the future and Nasdaq determines to delist our common stock, the delisting could substantially decrease trading in our common stock and adversely affect the market liquidity of our common stock; adversely affect our ability to obtain financing on acceptable terms, if at all, for the continuation of our operations; and harm our business. Additionally, the market price of our common stock may decline further and stockholders may lose some or all of their investment. The closing bid price of our common stock on the Nasdaq Capital Market was $0.34 on November 7, 2019.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

Recent Sales of Unregistered Securities

On July ~~7, 2017,~~1, 2019, we issued ~~4,267~~24,286 shares of common stock to participants in the Yield10 Bioscience, Inc. 401(k) Plan as a matching contribution. The issuance of these securities is exempt from registration pursuant to Section 3(a)(2) of the Securities Act, ~~of 1933,~~ as amended ~~(the "Act")~~ as exempted securities.

On July 7, 2017, we completed an offering of our securities. Investors participating in the transaction purchased a total of 570,784 shares of common stock at a price of $4.00 per share and an equal number of warrants with an exercise price of $5.04 per share, exercisable beginning on the six-month anniversary of the date of issuance. The warrants expire on the sixth anniversary of the date that they become exercisable. The shares of common stock sold in the offering are registered under a Form S-3 registration statement that became effective April 12, 2017. The warrants and the shares of common stock issuable upon the exercise of the warrants were not registered in the Form S-3 registration statement and were issued pursuant to the exemption from registration provided in Section 4(a)(2) of the Act. The shares of common stock issuable upon exercise of the warrants were later registered under a Form S-1/A registration statement that became effective August 31, 2017. Proceeds from this transaction were approximately $1,966, net of issuance costs of $317, and will be used for general corporate purposes, including working capital, and repayment of existing corporate obligations.

On September 12, 2017, the Company issued warrants to purchase up to 30,000 shares of common stock to the Company's investor relations consultant, in consideration for services rendered and to be rendered by the consultant. These warrants have an exercise price of $2.90 per share and are exercisable in whole or part at any time during the period commencing on September 12, 2017 and ending on September 11, 2024. The warrants were issued, and the shares of common stock issuable upon the exercise of the warrants are issuable, pursuant to the exemption from registration provided for in Section 4(a)(2) of the Act.

Issuer Purchases of Equity Securities

During the three months ended September 30, ~~2017,~~2019, there were no repurchases made by us or on our behalf, or by any “affiliated purchasers,” of shares of our common stock.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS.



~~4.1~~		~~Form of Investor Warrant to Purchase Common Stock (incorporated by reference herein to the exhibits to the Company's Report on Form 8-K filed on July 5, 2017 (File No. 333-33133)).~~

~~10.1~~		Form of Securities Purchase Agreement, dated as of July 3, 2017, by and among the Company and the purchasers named therein (incorporated by reference herein to the exhibits to the Company's Report on Form 8-K filed on July 5, 2017 (File No. 333-33133)).

31.1		Certification Pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 of the Principal Executive Officer (filed herewith).

31.2		Certification Pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 of the Principal Financial Officer (filed herewith).

32.1		Section 1350 Certification (furnished herewith).

101.1		The following financial information from the Yield10 Bioscience, Inc. Quarterly Report on Form 10-Q for the quarter ended September 30, ~~2017~~2019 formatted in XBRL: (i) Condensed Consolidated Balance Sheets, September 30, ~~2017~~2019 and December 31, ~~2016;~~2018; (ii) Condensed Consolidated Statements of Operations, Three and Nine Months Ended September 30, ~~2017~~2019 and ~~2016;~~2018; (iii) Condensed Consolidated Statements of Comprehensive Loss, Three and ~~nine~~Nine Months Ended September 30, ~~2017~~2019 and ~~2016;~~2018; (iv) Condensed Consolidated Statements of Cash Flows, Nine Months Ended September 30, ~~2017~~2019 and ~~2016;~~2018; (v) Condensed Consolidated Statements of Stockholders' Equity, Three and ~~(v)~~Nine Months Ended September 30, 2019 and 2018; and (vi) Notes to Consolidated Financial Statements.

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.



	YIELD10 BIOSCIENCE, INC.


November ~~9, 2017~~12, 2019	By:	/s/ OLIVER PEOPLES
		Oliver Peoples
		President and Chief Executive Officer
		(Principal Executive Officer)

November ~~9, 2017~~12, 2019	By:	/s/ CHARLES B. HAASER
		Charles B. Haaser
		Chief Accounting Officer
		(Principal Financial and Accounting Officer)



Year ended December 31,	Minimum lease payments
2017 (October to December)	$	226
2018	877
2019	855
2020	734
2021	654
2022 and thereafter	3,508
Total	$	6,854



	September 30, 2017	December 31, 2016
Stock Options	626,185	605,077
RSUs	14,367	21,735
Warrants	994,084	393,300
Total number of common shares reserved for future issuance	1,634,636	1,020,112



	Biopolymer Production Agreements			Employee Severance and Related Costs			Total
Aggregate Charges and Amounts Accrued	$	2,641		$	872		$	3,513
Paid in Cash	(1,717		)	(811		)	(2,528		)
Paid through Stock and Equipment	(196		)	—			(196		)
Ending Balance Accrued at September 30, 2017	$	728		$	61		$	789



	Three Months Ended September 30,			Nine Months Ended September 30,
	2016			2016

Total revenue	$	1,818		$	4,940
Costs and expenses:
Cost of product revenue	464			702
Research and development	3,793			9,438
Selling, general and administrative	510			1,429
Net gain on sale of biopolymer assets	(9,833		)	(9,833		)
Total costs and expenses	(5,066		)	1,736
Other (income) or expense	31			—
Income from discontinued operations	6,853			3,204
Income tax expense	(1,259		)	(1,259		)
Total income from discontinued operations	$	5,594		$	1,945



Program Title	Funding Agency	Total Government Funds		Total received through		Remaining amount available as of		Grant Expiration
Program Title	Funding Agency	Total Government Funds		September 30, 2017		September 30, 2017		Grant Expiration
Subcontract from Michigan State University project funded by DOE entitled "A Systems Approach to Increasing Carbon Flux to Seed Oil"	Department of Energy	$	2,957	$	—	$	2,957	October 2022
Production of High Oil, Transgene Free Camelina Sativa Plants through Genome Editing ("Camelina")	Department of Energy	1,997		1,532		465		September 2018
Subcontract from NC State University (NCSU) project funded by DOE ARPA-E entitled "Jet Fuel from Camelina Sativa: A Systems Approach"	Department of Energy	276		276		—		March 2017
Total		$	5,230	$	1,808	$	3,422