SELLING STOCKHOLDERSDILUTION
The sharesIf you invest in our common stock in this offering, your ownership interest will be diluted immediately to the extent of the difference between the price you pay in this offering and the net tangible book value per share of common stock being offeredafter this offering.
Our net tangible book value as of June 30, 2023 was approximately $90.2 million, or $0.18 per share. Net tangible book value per share is determined by dividing our total tangible assets, less total liabilities, by the selling stockholder are those issuable to the selling stockholder upon the exercisenumber of the Purchase Warrant, upon the exercise of the Exchange Warrant and the shares of our common stock issuedoutstanding as a financing fee in August 2020 in connectionof June 30, 2023. Dilution with respect to net tangible book value per share represents the issuancedifference between the amount per share paid by purchasers of the 2024 Notes, or the Financing Fee Shares. For additional information regarding the Exchange Warrant, the Purchase Warrant and Financing Fee Shares, see “Prospectus Summary — Recent Developments” above. We are registering the shares of common stock in orderthis offering and the net tangible book value per share of our common stock immediately after this offering.
After giving effect to permit the selling stockholdersale of 180,677,966 shares of our common stock in this offering at an assumed offering price of $0.59 per share, the last reported sale price of our common stock on the NYSE American on September 8, 2023, and after deducting estimated offering commissions and offering expenses payable by us, our as adjusted net tangible book value as of June 30, 2023 would have been approximately $193.6 million, or $0.29 per share. This represents an immediate increase in net tangible book value of $0.11 per share to offer the shares for resale from time to time.
The table below lists the sellingexisting stockholders and other information regarding the beneficial ownershipimmediate dilution of the shares of$0.30 per share to investors purchasing our common stock byin this offering at the selling stockholder. The second column lists the number of shares of common stock beneficially owned by each selling stockholder, based on its ownership of the shares of common stock, the Exchange Warrant and the Purchase Warrant, as of May 15, 2023, assuming full exercise of the warrants held by the selling stockholder on that date.
In accordance with the terms of registration rights agreements with the selling stockholder, this prospectus generally covers the resale of that number of shares of common stock equal to the number of shares of common stock: (i) issued to the selling stockholder in respect of a fee in connection with the issuance of the 2024 Notes, or the Financing Fee Shares and (ii) issuable upon exercise of the Purchase Warrant, and (iii) issuable upon exercise of the Exchange Warrant.
For purposes of this prospectus, “selling stockholder” includes the stockholder listed below and their permitted pledgees, donees, transferees, designees or successors-in-interest who may acquire securities through a pledge, gift, partnership distribution or other non-sale related transfer from the selling stockholder. Our registration of the resale of the shares of common stock, including common stock issuable upon exercise of the Purchase Warrant and Exchange Warrant, does not necessarily mean that the selling stockholder will sell all or any of such common stock.assumed public offering price. The following table sets forth certain information as of May 15, 2023 concerning theillustrates this dilution on a per share basis:
| Assumed public offering price per share | | | | | | | | | | $ | 0.59 | | |
| Net tangible book value per share of as June 30, 2023 | | | | $ | 0.18 | | | | | | | | |
| Increase in net tangible book value per share attributable to this offering | | | | | 0.11 | | | | | | | | |
| As adjusted net tangible book value per share as of June 30, 2023, after giving effect to this offering | | | | | | | | | | | 0.29 | | |
| Dilution per share to investors purchasing our common stock in this offering | | | | | | | | | | $ | 0.30 | | |
The above discussion and table are based on 492,826,683 shares of common stock that may be offered from time to time by the selling stockholder with this prospectus. The information is based on information provided by or on behalf of the selling stockholder.
Selling Stockholder information for each additional selling stockholder, if any, will be set forth by prospectus supplement to the extent required prior to the time of any offer or sale of such selling stockholder’s shares pursuant to this prospectus. Information about the selling stockholder may change over time. Any changed or new information given to us by the selling stockholder, including the identity of each selling stockholder and the number of shares registered on its behalf, will be set forth in supplements to this prospectus or amendments to the registration statement of which this prospectus is a part, if and when necessary.
| | | Shares Beneficially Owned
After the Offering
| | | Number of
Shares
Being
Offered
for Resale
| | | Shares Beneficially
Owned Prior to the Offering
| |
Name and Address of Selling Stockholder | | | Shares | | | Percentage(1)
| | | Shares(2)
| | | Percentage(1)
| |
PHC Holdings Corporation(3)
| | | | | 86,892,237(4) | | | | | | 15.4 | | | | | | 86,892,237(4) | | | | | | — | | | | | | — | | |
*
Less than 1%
(1)
The percentage is based on 479,871,695 shares ofour common stock outstanding as of May 5,June 30, 2023 adjusted in accordance with Rule 13d-3 under the Exchange Act.
and exclude:
(2)•
Assumes the sale of all shares offered pursuant to this prospectus.
(3)
PHC Holdings Corporation, as the selling stockholder exercises voting and investment control over these shares. The address of the selling stockholder is 2-38-5 Nishishimbashi, Minato-ku, Tokyo 105-8433 Japan.
(4)
Consists of (i) 2,941,17631,785,464 shares of common stock held byreserved for outstanding equity awards as of June 30, 2023, at a weighted-average price of $0.92 per share;
•
427,821 shares of common stock issuable upon the selling stockholderexercise of warrants outstanding as of June 30, 2023, at a weighted-average exercise price of $2.45 per share, and (ii) 83,951,061 shares of common stock issuable upon the exercise of prefunded warrants, held by PHC Holdings Corporation, with an exercise price of $0.001 per share, as of June 30, 2023;
•
54,211,649 shares of common stock reserved for future issuance under our equity incentive plans as of June 30, 2023 consisting of (a) 28,775,002 shares of common stock reserved for future issuance under the Amended and Restated 2015 Equity Incentive Plan, (b) 201,569 shares of common stock reserved for future issuance under our Inducement Plan, (c) 17,760,078 shares of common stock reserved for issuance under the 2016 Employee Stock Purchase Plan and (d) 7,475,000 shares of common stock reserved for future issuance under our 2023 Commercial Equity Plan;
•
30,372,058 shares of common stock issuable upon conversion of our Series B Convertible Preferred Stock outstanding warrants.as of June 30, 2023; and
•
39,689,142 shares of common stock issuable upon conversion of convertible notes outstanding as of June 30, 2023.
The above table does not include the effects of any transactions after June 30, 2023, including without limitation:
•
the exchange of $30.8 million aggregate principal amount of our 2025 Notes for an aggregate of 35,139,796 shares of Common Stock and $7.5 million in cash; and
•
the issuance of warrants to purchase 832,362 shares to Hercules in connection with our entry into a senior credit facility with Hercules.