Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2019 | Sep. 05, 2019 | Dec. 31, 2018 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Jun. 30, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | Rezolute, Inc. | ||
Entity Central Index Key | 0001509261 | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Public Float | $ 4,080,000 | ||
Trading Symbol | RZLT | ||
Entity Common Stock, Shares Outstanding | 293,320,891 | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | true |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 11,573 | $ 1,646 |
Prepaid expenses and other | 571 | 362 |
Total current assets | 12,144 | 2,008 |
Non-current assets: | ||
Property and equipment, net | 44 | 368 |
Intangible assets, net | 29 | 37 |
Lease deposits and other | 35 | 90 |
Total assets | 12,252 | 2,503 |
Current liabilities: | ||
Accounts payable and accrued expenses | 1,051 | 1,854 |
Accrued compensation and benefits | 790 | 771 |
Current portion of license fees payable to Xoma | 6,500 | 0 |
Convertible notes payable, net | 10 | 3,435 |
Deferred lease liability | 28 | 114 |
Embedded derivative liability | 0 | 74 |
Total current liabilities | 8,379 | 6,248 |
Non-current liabilities: | ||
License fees payable to Xoma, net of current portion | 2,000 | 0 |
Other | 121 | 216 |
Total liabilities | 10,500 | 6,464 |
Commitments and contingencies (Notes 4, 9 and 13) | ||
Stockholders' equity (deficit): | ||
Preferred Stock, $0.001 par value; 20,000 shares authorized, no shares issued | ||
Common Stock, $0.001 par value, 500,000 shares authorized; 210,390 and 62,166 shares issued and outstanding as of June 30, 2019 and 2018, respectively | 210 | 62 |
Additional paid-in capital | 128,445 | 90,161 |
Accumulated deficit | (126,903) | (94,184) |
Total stockholders' equity (deficit) | 1,752 | (3,961) |
Total liabilities and stockholders' equity (deficit) | $ 12,252 | $ 2,503 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2019 | Jun. 30, 2018 |
Consolidated Balance Sheets | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 20,000 | 20,000 |
Preferred stock, issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000 | 500,000 |
Common stock, shares issued | 210,390 | 62,166 |
Common stock, shares outstanding | 210,390 | 62,166 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Research and development: | ||
Compensation and benefits | $ 2,578 | $ 5,604 |
Material manufacturing costs | 1,232 | 1,162 |
Consultants and outside services | 674 | 651 |
Facilities and other | 534 | 1,962 |
Total research and development | 19,079 | 17,280 |
General and administrative: | ||
Compensation and benefits | 4,286 | 6,684 |
Facilities and other | 1,193 | 1,337 |
Professional fees | 841 | 762 |
Investor relations | 500 | 317 |
Total general and administrative | 6,820 | 9,100 |
Impairment of long-lived assets | 33 | 1,691 |
Loss on sale of property and equipment | 12 | 663 |
Total operating expenses | 25,944 | 28,734 |
Operating loss | (25,944) | (28,734) |
Non-operating income (expense): | ||
Interest expense | (4,958) | (689) |
Loss on extinguishment of debt | 0 | (602) |
Gain on change in fair value of embedded derivatives | 74 | 26 |
Gain on lease termination | 168 | 0 |
Rental income | 153 | 136 |
Interest and other income | 61 | 1 |
Total non-operating income (expense) | (4,502) | (1,128) |
Net loss | (30,446) | (29,862) |
Net loss attributable to common stockholders | $ (32,719) | $ (29,862) |
Net loss per common share - basic and diluted | $ (0.37) | $ (0.54) |
Weighted average number of common shares outstanding - basic and diluted | 88,872 | 55,655 |
License | ||
Research and development: | ||
Cost of goods and services sold | $ 14,026 | $ 6,273 |
Clinical trial costs | ||
Research and development: | ||
Cost of goods and services sold | $ 35 | $ 1,628 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) shares in Thousands, $ in Thousands | Series AA Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Jun. 30, 2017 | $ 0 | $ 49 | $ 72,801 | $ (64,322) | $ 8,528 |
Balance (in shares) at Jun. 30, 2017 | 49,229 | ||||
Stock-based compensation | 0 | $ 0 | 5,095 | 0 | 5,095 |
Issued to consultants for services | 0 | 0 | 550 | 0 | 550 |
Issued for debt discount | 0 | 0 | 2,718 | 0 | 2,718 |
In private placement, net of costs of $60 | 0 | $ 5 | 4,435 | 0 | 4,440 |
In private placement, net of costs of $60 (in shares) | 4,500 | ||||
For license rights to Xoma, Inc. | 0 | $ 8 | 4,562 | 0 | 4,570 |
For license rights to Xoma, Inc. (in shares) | 8,093 | ||||
For commitment fee in private placement | 0 | $ 0 | 0 | 0 | 0 |
For commitment fee in private placement (in shares) | 344 | ||||
Net loss | 0 | $ 0 | 0 | (29,862) | (29,862) |
Balance at Jun. 30, 2018 | 0 | $ 62 | 90,161 | (94,184) | (3,961) |
Balance (in shares) at Jun. 30, 2018 | 62,166 | ||||
Stock-based compensation | 0 | $ 0 | 2,636 | 0 | 2,636 |
Issued to consultants for services | 0 | 0 | 12 | 12 | |
Modification for debt discount to former member of Board of Directors | 0 | 0 | 138 | 0 | 138 |
Shareholder surrender of shares for no consideration | 0 | $ 0 | 0 | 0 | 0 |
Shareholder surrender of shares for no consideration (in shares) | (300) | ||||
Beneficial conversion feature related to Fiscal 2018 Notes | 0 | $ 0 | 2,233 | 0 | 2,233 |
Beneficial conversion feature related to Series AA Preferred Stock | 0 | 0 | 2,273 | (2,273) | 0 |
In private placement, net of costs of $60 | 0 | ||||
For license rights to Xoma, Inc. | 0 | ||||
Cash, including Exclusivity Payment | $ 25,000 | 0 | 0 | 0 | 25,000 |
Cash, including Exclusivity Payment (in shares) | 2,500 | ||||
Principal under Fiscal 2018 Notes | $ 5,340 | 0 | 0 | 0 | 5,340 |
Principal under Fiscal 2018 Notes (in shares) | 668 | ||||
Accrued interest under Fiscal 2018 Notes | $ 800 | 0 | 0 | 0 | 800 |
Accrued interest under Fiscal 2018 Notes (in shares) | 100 | ||||
Conversion of Series AA Preferred Stock to Common Stock | $ (31,140) | $ 148 | 30,992 | 0 | 0 |
Conversion of Series AA Preferred Stock to Common Stock (in shares) | (3,268) | 148,524 | |||
Net loss | $ 0 | $ 0 | 0 | (30,446) | (30,446) |
Balance at Jun. 30, 2019 | $ 0 | $ 210 | $ 128,445 | $ (126,903) | $ 1,752 |
Balance (in shares) at Jun. 30, 2019 | 210,390 |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Deficit) (Parenthetical) $ in Thousands | 12 Months Ended |
Jun. 30, 2018USD ($) | |
Consolidated Statements of Stockholders' Equity (Deficit) | |
Payments of stock issuance costs | $ 60 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (30,446) | $ (29,862) |
Stock-based compensation expense | 2,636 | 5,095 |
Beneficial conversion feature attributable to Fiscal 2018 Notes | 2,233 | 0 |
Accretion of debt discount and issuance costs | 2,053 | 505 |
Loss on extinguishment of debt | 0 | 602 |
Issuance of common stock for license fees payable to Xoma | 0 | 4,570 |
Depreciation and amortization expense | 49 | 1,066 |
Impairment of long-lived assets | 33 | 1,691 |
Loss on sale of property and equipment | 12 | 663 |
Fair value of warrants issued for services | 12 | 550 |
Gain on lease termination | (168) | 0 |
Derivative gains | (74) | (26) |
Changes in operating assets and liabilities: | ||
Decrease (increase) in prepaid expenses and other assets | (251) | 135 |
Increase (decrease) in accounts payable and accrued liabilities | (548) | 719 |
Increase in license fees payable to Xoma | 8,500 | 0 |
Increase in interest payable | 655 | 179 |
Net Cash Used In Operating Activities | (15,304) | (14,113) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from sale of equipment | 278 | 1,550 |
Refund of deposit | 0 | 188 |
Purchase of property and equipment | (47) | (6) |
Net Cash Provided By Investing Activities | 231 | 1,732 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Exclusivity Payment | 1,500 | 0 |
Closing payment | 23,500 | 0 |
Proceeds from issuance of Common Stock | 0 | 4,500 |
Payment of offering costs | 0 | (60) |
Payment of debt issuance costs | 0 | (240) |
Proceeds from convertible notes payable | 0 | 5,340 |
Net Cash Provided by Financing Activities | 25,000 | 9,540 |
Net increase (decrease) in cash and cash equivalents | 9,927 | (2,841) |
Cash and cash equivalents at beginning of fiscal year | 1,646 | 4,487 |
Cash and cash equivalents at end of fiscal year | 11,573 | 1,646 |
SUPPLEMENTARY CASH FLOW INFORMATION: | ||
Cash paid for interest | 0 | 0 |
Cash paid for income taxes | 0 | 0 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Principal balance of Fiscal 2018 Notes | 5,340 | 0 |
Accrued interest under Fiscal 2018 Notes | 800 | 0 |
Exclusivity Payment Liability | 1,500 | 0 |
Conversion of Series AA Preferred Stock to Common Stock | 31,140 | 0 |
Fair value of warrant modification issued for debt discount | 138 | 2,718 |
Fair value of embedded derivative for debt discount | $ 0 | $ 100 |
NATURE OF OPERATIONS AND SUMMAR
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Jun. 30, 2019 | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 — NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations Rezolute, Inc. (the “Company”) is a clinical stage biopharmaceutical company incorporated in Delaware in 2010. The Company has one wholly owned subsidiary, AntriaBio Delaware, Inc. (“Antria Delaware”). Consolidation The accompanying consolidated financial statements include the accounts of the Company and Antria Delaware. All significant intercompany balances and transactions have been eliminated in consolidation. Basis of Presentation The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Certain amounts in the previously issued comparative financial statements for fiscal 2018 have been reclassified to conform to the current fiscal 2019 financial statement presentation. These reclassifications had no effect on the previously reported net loss, working capital, cash flows and stockholders’ equity (deficit). Comprehensive income (loss) is defined as net income (loss) plus other comprehensive income (loss). Other comprehensive income (loss) is comprised of revenues, expenses, gains, and losses that under GAAP are reported as separate components of stockholders’ equity (deficit) instead of net income (loss). For the fiscal years ended June 30, 2019 and 2018, the only component of comprehensive loss was the Company’s net loss. The Company’s Chief Executive Officer also serves as the Company’s chief operating decision maker (the “CODM”) for purposes of allocating resources and assessing performance based on financial information of the Company. Since its inception, the Company has determined that its activities as a clinical stage biopharmaceutical company are classified as a single reportable operating segment. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts in the consolidated financial statements and the accompanying notes. The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes are reasonable under the circumstances, to determine the carrying values of assets and liabilities that are not readily apparent from other sources. The Company’s significant accounting estimates include, but are not necessarily limited to, estimated useful lives and impairment of fixed assets and intangible assets, fair value of share-based payments and warrants, fair value of derivative instruments, management’s assessment of going concern, estimates of the probability and potential magnitude of contingent liabilities, and the valuation allowance for deferred tax assets due to continuing and expected future operating losses. Actual results could differ from those estimates. Risks and Uncertainties The Company's operations may be subject to significant risk and uncertainties including financial, operational, regulatory and other risks associated with a clinical stage company, including the potential risk of business failure as discussed further in Note 2. Cash and Cash Equivalents All highly liquid investments purchased with an original maturity of three months or less that are freely available for the Company’s immediate and general business use are classified as cash and cash equivalents. Cash and cash equivalents consist primarily of demand deposits with financial institutions. Property and Equipment Property and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, as follows: Furniture and fixtures 5 - 7 years Leasehold improvements 5 - 7 years Laboratory equipment 3 - 15 years Leasehold improvements are amortized over the remaining lease term or the estimated useful life of the asset, whichever is shorter. Depreciation commences when assets are initially placed into service for their intended use. Maintenance and repairs are expensed as incurred. Intangible Assets Intangible assets consist of patents and are recorded at the estimated acquisition date fair value. Such costs are being amortized over 11 years which is the life of the patents at the time they were acquired. Amortization expense related to intangible assets amounted to approximately $7,000 for each of the fiscal years ended June 30, 2019 and 2018. Future amortization expense is expected to be approximately $7,000 for each of the next five fiscal years. Impairment of Long-lived Assets Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Impairment exists for property and equipment and identifiable intangible assets if the carrying amounts of such assets exceed the estimates of future net undiscounted cash flows expected to be generated by such assets. An impairment charge is recognized for the amount by which the carrying amount of the asset, or asset group, exceeds its fair value. Debt Discounts and Issuance Costs Debt discounts and issuance costs (“DDIC”) incurred to obtain new debt financing or modify existing debt financing consist of incremental direct costs incurred for professional fees and due diligence services. If convertible notes are issued in conjunction with warrants, the Company allocates the proceeds to each component using a relative fair value. DDIC are presented in the accompanying consolidated balance sheets as a reduction in the carrying value of the debt and are accreted to interest expense using the effective interest method. When debt arrangements are amended, the revised terms are evaluated to determine if the amendment should be accounted for as a troubled debt restructuring, a modification or an extinguishment. If the Company determines that the lender has provided a concession and the Company is experiencing financial difficulties, treatment as a troubled debt restructuring would be required where a gain would generally be recognized. If the Company concludes that accounting as a modification is required, then any costs incurred on behalf of the lenders are accounted for as additional DDIC. If the Company concludes that accounting as an extinguishment is required, an extinguishment charge is measured on the date of the amendment based on the amount by which the fair value of the new debt instrument exceeds the net carrying value of the original debt instrument. Beneficial Conversion Features A beneficial conversion feature (“BCF”) is a non-detachable conversion feature that is “in the money” at the commitment date, which requires recognition of interest expense for underlying debt instruments and a deemed dividend for underlying equity instruments. A conversion option is in the money if the effective conversion price is lower than the commitment date fair value of a share into which it is convertible. A contingent BCF feature is measured using the commitment date security price but is not recognized in earnings until the contingency is resolved. Research and Development Costs Research and development costs are expensed as incurred. Intangible assets for in-licensing costs incurred under license agreements with third parties are charged to expense, unless the licensing rights have separate economic value in alternative future research and development projects or otherwise. Stock-Based Compensation The Company measures the fair value of employee and director services received in exchange for all equity awards granted, including stock options, based on the fair market value of the award as of the grant date. The Company computes the fair value of stock options using the Black-Scholes-Merton (“BSM”) option pricing model and recognizes the cost of the equity awards over the period that services are provided to earn the award, usually the vesting period. For awards granted which contain a graded vesting schedule, and the only condition for vesting is a service condition, compensation cost is recognized as an expense on a straight-line basis over the requisite service period as if the award was, in substance, a single award. The Company recognizes the impact of forfeitures in the period that the forfeiture occurs, rather than estimating the number of awards that are not expected to vest in accounting for stock-based compensation. Options and Warrants for Non-Employee Services The Company accounts for stock options and warrants granted to non-employees by determining the fair value of the equity instrument issued on the commitment date, with expense recognized over the service period. Prior to the establishment of the commitment date, the Company continues to remeasure the fair value of the award, resulting in the recognition of subsequent gains and losses until the commitment date is achieved. The Company estimates fair value of non-employee awards using the BSM option pricing model. Derivatives When the Company enters into a financial instrument such as a debt or equity agreement (the “host contract”), the Company assesses whether the economic characteristics of any embedded features are clearly and closely related to the primary economic characteristics of the remainder of the host contract. When it is determined that (i) an embedded feature possesses economic characteristics that are not clearly and closely related to the primary economic characteristics of the host contract, and (ii) a separate, stand-alone instrument with the same terms would meet the definition of a financial derivative instrument and cannot be classified in stockholders’ equity, then the embedded feature is bifurcated from the host contract and accounted for as a derivative instrument. The estimated fair value of the derivative feature is recorded separately from the carrying value of the host contract, with subsequent changes in the estimated fair value recorded as a non-operating gain or loss in the Company’s consolidated statements of operations. Income Taxes The Company accounts for income taxes under the asset and liability method. Under this method, deferred income tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using enacted tax rates and laws that are expected to be in effect when the differences are expected to be recovered or settled. Realization of deferred income tax assets is dependent upon future taxable income. A valuation allowance is recognized if it is more likely than not that some portion or all of a deferred income tax asset will not be realized based on the weight of available evidence, including expected future earnings. The Company recognizes an uncertain tax position in its financial statements when it concludes that a tax position is more likely than not to be sustained upon examination based solely on its technical merits. Only after a tax position passes the first step of recognition will measurement be required. Under the measurement step, the tax benefit is measured as the largest amount of benefit that is more likely than not to be realized upon effective settlement. This is determined on a cumulative probability basis. The full impact of any change in recognition or measurement is reflected in the period in which such change occurs. Interest and penalties related to income taxes are recognized in the provision for income taxes. Loss Per Common Share Basic net loss per common share is computed by dividing the net loss applicable to common stockholders by the weighted average number of common shares outstanding for each period presented. Net loss applicable to common stockholders is further adjusted to deduct BCFs that arise from deemed dividends as discussed above. Diluted net loss per common share is computed by giving effect to all potential shares of Common Stock, including stock options, convertible debt, Series AA Preferred Stock and warrants, to the extent dilutive. Recent Accounting Pronouncements Recently Adopted Standards . The following accounting standards were adopted during the fiscal year ended June 30, 2019: In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Improvements to Employee Share-Based Payment , aimed at simplifying the accounting for share-based transactions. The standard included modifications to the accounting for income taxes upon vesting or settlement of equity awards, employer tax withholding on share-based compensation and financial statement presentation of excess tax benefits. The Company decided to recognize forfeitures in the period that the forfeiture occurs rather than estimating the number of awards that are not expected to vest in accounting for stock-based compensation. ASU 2016-09 was effective for the Company on July 1, 2018 and the adoption did not have a material impact on the Company’s consolidated financial statements. In January 2016, the FASB issued ASU 2016-01, Financial Instruments — Overall: Recognition and Measurement of Financial Assets and Financial Liabilities , which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. ASU 2016-01 was effective for the Company on July 1, 2018. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements. In May 2017, the FASB issued ASU 2017-9, Compensation — Stock Compensation (Topic 718): Scope of Modification Accounting . This ASU includes guidance on what changes to share-based payment awards would require modification accounting. The Company adopted this ASU on July 1, 2018. The adoption of the new provisions did not have a material impact on the Company’s financial condition or results of operations. Standards Required to be Adopted in Future Years. The following accounting standards are not yet effective; management has not completed its evaluation to determine the impact that adoption of these standards will have on the Company’s consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 amends the guidance on the impairment of financial instruments. This update adds an impairment model (known as the current expected credit losses model) that is based on expected losses rather than incurred losses. Under the new guidance, an entity recognizes, as an allowance, its estimate of expected credit losses. In November 2018, ASU 2016-13 was amended by ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments – Credit Losses. ASU 2018-19 changes the effective date of the credit loss standards (ASU 2016-13) to fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Further, the ASU clarifies that operating lease receivables are not within the scope of ASC 326-20 and should instead be accounted for under the new leasing standard, ASC 842. The Company has not yet determined the effect that ASU 2018-19 will have on its results operations, balance sheets or financial statement disclosures. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This ASU requires the Company to recognize lease assets and lease liabilities on the balance sheet and also disclose key information about leasing arrangements. Early adoption is permitted, and the new standard was required to be adopted retrospectively to each prior reporting period presented upon initial adoption. However, in July 2018 the FASB issued ASU No. 2018-11 Targeted Improvements , which provides lessees the option to apply the new leasing standard to all open leases as of the adoption date by recognizing a cumulative-effect adjustment to accumulated deficit in the period of adoption without restating prior periods. The Company expects the primary impact of adopting this standard will result in the recognition of right-of-use assets and right-of-use liabilities for the discounted present value of the lease commitments summarized in Note 9. The Company intends to utilize the transition approach set forth in ASU No. 2018-11 upon adoption of ASU No. 2016-02 which is required on July 1, 2019. The expected impact of adoption to be reflected in the Company’s consolidated financial statements for the fiscal quarter ending September 30, 2019, is as follows (in thousands): Right-of-use assets recorded under new standard $ 605 Right-of-use liabilities recorded under new standard: Current $ 227 Long-term 406 Total 633 Eliminate deferred rent liability under current accounting standard (28) Net increase in liabilities due to adoption of new standard $ 605 In June 2018, the FASB issued ASU 2018-07, “ Compensation — Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting ,” which expands the scope of ASC 718 to include share-based payment transactions for acquiring goods and services from non-employees. An entity should apply the requirements of ASC 718 to non-employee awards except for specific guidance on inputs to an option pricing model and the attribution of cost. The new guidance is effective for fiscal years, and interim reporting periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company is evaluating the effects of the adoption of this guidance and currently expects to adopt this guidance for the fiscal year ending June 30, 2020. |
LIQUIDITY
LIQUIDITY | 12 Months Ended |
Jun. 30, 2019 | |
LIQUIDITY | |
LIQUIDITY | NOTE 2 — LIQUIDITY The Company is in the clinical stage and has not yet generated any revenues. As reflected in the accompanying consolidated financial statements, for the fiscal year ended June 30, 2019 the Company incurred a net loss of $30.4 million and net cash used in operating activities amounted to $15.3 million. As of June 30, 2019, the Company had an accumulated deficit of $126.9 million. As of June 30, 2019, the Company had cash and cash equivalents of $11.6 million and total liabilities of $10.5 million. As discussed in Note 6, in January 2019 the Company closed an equity offering with two new investors (the “New Investors”) that resulted in cash proceeds of $25.0 million and the conversion to equity of the Fiscal 2018 Notes with an aggregate principal balance of $5.3 million plus accrued interest of $0.8 million. As discussed in Note 13, in July and August 2019 the Company received aggregate net proceeds of approximately $22.6 million from the issuance of approximately 82.9 million shares of Common Stock to the New Investors and other investors in a private placement. As a result of the equity financings completed during 2019, management believes the Company’s existing cash balance of $11.6 million plus $22.6 million of additional net cash proceeds received in July and August 2019 is adequate to carry out planned activities at least through September 2020. The Company’s contractual obligations and other planned spending through September 2020 consist of (i) licensing obligations to Xoma Corporation of $8.5 million as discussed in Note 4, (ii) research and development spending on RZ358, AB101 and other clinical programs for $11.0 million, and (iii) approximately $10.4 million for spending on compensation, benefits, rent, other research costs, and public company costs for auditing and professional fees. The Company expects to continue to pursue equity and/or debt financings to provide funding for planned activities for the fiscal year ending June 30, 2021 and beyond. To the extent that additional funding is obtained during the remainder of the fiscal year ending June 30, 2020, the Company plans to accelerate timing to complete clinical trials and other research and development activities which would result in increased spending. However, the Company has the flexibility to delay clinical programs to ensure that adequate capital resources are available. There are no assurances that the Company will be able to obtain additional financing through other sources, such as equity offerings and bank financings in the future. Even if these other financing sources are available, they may be on terms that are not acceptable to management and the Company’s stockholders. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Jun. 30, 2019 | |
PROPERTY AND EQUIPMENT | |
PROPERTY AND EQUIPMENT | NOTE 3 — PROPERTY AND EQUIPMENT Summary The following is a summary of property and equipment as of June 30, 2019 and 2018 (in thousands): 2019 2018 Furniture and fixtures $ 47 $ 118 Leasehold improvements — 29 Laboratory equipment — 739 Total property and equipment 47 886 Less accumulated depreciation and amortization (3) (518) Net property and equipment $ 44 $ 368 Depreciation and amortization expense related to property and equipment amounted to approximately $41,000 and $1.1 million for the fiscal years ended June 30, 2019 and 2018, respectively. Restructuring In April 2018, the Company implemented a restructuring plan to discontinue manufacturing activities and attempt to sublease facilities in Louisville, Colorado. This decision triggered an evaluation for impairment of the Company’s long-lived assets, including leasehold improvements at the facilities in Colorado. Upon completion of this impairment analysis, the Company concluded that leasehold improvements with a net book value of $1.7 million were impaired. Accordingly, the Company recorded an impairment charge for $1.7 million for the fiscal year ended June 30, 2018. The restructuring plan included a reduction in the Company’s workforce by 30 employees that resulted in severance payments of approximately $0.6 million to the affected employees. These severance payments were primarily related to employees engaged in research and development activities and are included in compensation and benefits in the accompanying consolidated statement of operations for the fiscal year ended June 30, 2018. On June 22, 2018, the Company completed a sale of certain laboratory equipment and other manufacturing assets for proceeds of approximately $1.6 million. This transaction resulted in a loss on sale of property and equipment of $0.7 million in the accompanying consolidated statement of operations for the fiscal year ended June 30, 2018. In December 2018, the Company vacated its leased office and laboratory space in Colorado, resulting in an impairment charge of approximately $33,000 related to leasehold improvements, laboratory equipment, furniture and fixtures. For the fiscal year ended June 30, 2019, the Company completed sales of furniture, fixtures, and laboratory equipment for proceeds of approximately $0.3 million. These transactions resulted in the Company recording a loss on sale of property and equipment of approximately $12,000 in the accompanying consolidated statement of operations for the fiscal year ended June 30, 2019. As discussed further in Note 9, the Company also recognized a gain of approximately $0.2 million from the termination of the Colorado leases and subleases. |
LICENSE AGREEMENTS
LICENSE AGREEMENTS | 12 Months Ended |
Jun. 30, 2019 | |
LICENSE AGREEMENTS | |
LICENSE AGREEMENTS | NOTE 4 —LICENSE AGREEMENTS Xoma License Agreement On December 6, 2017, the Company entered into a license agreement (“License Agreement”) with XOMA Corporation (“Xoma”), through its wholly-owned subsidiary, XOMA (US) LLC, pursuant to which Xoma granted an exclusive global license to the Company to develop and commercialize Xoma 358 (formerly X358, now RZ358) for all indications. Xoma and the Company concurrently entered into a Common Stock purchase agreement (together with the License Agreement, the “Transaction Documents”) pursuant to which the Company would issue equity securities to Xoma in connection with certain financing milestones. On March 30, 2018, Xoma and the Company amended the Transaction Documents to add terms specifying the financial responsibility for certain tasks related to the technology transfer and to adjust the number of shares issuable to Xoma under the purchase agreement. On March 30, 2018, the Company amended the Transaction Documents whereby the License Agreement was amended to add terms specifying the financial responsibility for certain tasks related to the technology transfer, and the purchase agreement was amended to (i) adjust the total shares of Common Stock issuable at the initial closing from $5.0 million in value to 7.0 million shares; (ii) increase the shares of Common Stock due upon a qualified financing from $7.0 million in value to $8.5 million in value; and (iii) increase the shares issuable in 2019 from $7.0 million in value to $8.5 million in value. In April 2018, the issuance of Fiscal 2018 Notes discussed in Note 5 triggered to obligation to issue 8.1 million shares of Common Stock to Xoma. This issuance satisfied the obligations discussed above to issue 7.0 million shares and a portion of the qualified financing shares up to $8.5 million in value. On January 7, 2019, the parties further amended the Transaction Documents. The License Agreement was amended to eliminate the requirement that equity securities be issued to Xoma upon the future closing of certain qualified and to replace it with a requirement for the Company to make five cash payments to Xoma totaling $8.5 million on or before specified staggered future dates (the “Future Cash Payments”). The Future Cash Payments are due for $1.5 million by September 30, 2019, $1.0 million by December 31, 2019, $2.0 million by March 31, 2020, $2.0 million by June 30, 2020, and $2.0 million by September 30, 2020. As a result of this amendment to the License Agreement, the Company recognized a liability for the entire $8.5 million of Future Cash Payments that are required. Of this amount, $6.5 million is classified as a current liability and $2.0 million is classified as a long-term liability in the accompanying consolidated balance sheet as of June 30, 2019. If a future qualified financing occurs before the Future Cash Payments are fully paid, the Company is required to pay Xoma 15% of the net proceeds of such future qualified financing (“Early Payments”) to be credited against the remaining unpaid Future Cash Payments in the reverse order of their future payment date. Obligations to make the Future Cash Payments following a qualified financing and the obligations to make Early Payments shall end when the Future Cash Payments are fully paid for the total of $8.5 million. As discussed in Note 13, the Company completed equity financings for net proceeds of approximately $22.6 million in July and August 2019, which resulted in the obligation to make Early Payments of approximately $3.4 million. The Early Payments were paid in August 2019 and eliminated the Future Cash Payments that would have otherwise been due on September 30, 2020 for $2.0 million and on June 30, 2020 for approximately $1.4 million. In addition to the Future Cash Payments, Xoma was paid approximately $5.9 million in cash upon the closing of the Series AA Financing discussed in Note 6, which consisted of $5.5 million of consideration for the license, $50,000 for a delay fee, and payment of accrued liabilities of approximately $0.4 million. The Company recognized an expense of $5.5 million upon payment of the license fee and the delay fee for the fiscal year ended June 30, 2019. The Company satisfied the aggregate payment of $5.9 million in February 2019 from a portion of the net proceeds from the Series AA Financing. The amendment to the License Agreement also revised the amount the Company is required to expend on development of RZ358 and related licensed products and revised provisions with respect to the Company’s diligence efforts in conducting clinical studies. Finally, the amendment to the License Agreement eliminated Xoma’s previous right to appoint a member to the Company’s board of directors. As of June 30, 2019, Xoma owns approximately 8.1 million shares of the Company’s Common Stock. The License Agreement provides Xoma with the right and option to require the Company to use its best efforts to facilitate orderly sales of the shares to a third party or purchase the shares (the “Put Option”). Under the amended License Agreement, the Put Option becomes effective if the Company fails to list its shares of Common Stock on the Nasdaq Stock Market or a similar national exchange prior to December 31, 2019. Xoma may exercise the Put option for up to a total of 2.5 million shares of Common Stock for the fiscal year ending December 31, 2020, and up to an additional 2.5 million shares thereafter. If the Put Option becomes exercisable, the Company may be required to pay a price per share equal to the average of the closing bid and asked prices of the Common Stock on the date the Put Option is exercised. ActiveSite License Agreement On August 4, 2017, the Company entered into a Development and License Agreement with ActiveSite Pharmaceuticals, Inc. (“ActiveSite”) pursuant to which the Company acquired the rights to ActiveSite’s Plasma Kallikrein Inhibitor program (“PKI Program”). The Company desires to use the PKI Program to develop, file, manufacture, market and sell products for diabetic macular edema and other human therapeutic indications. The Company was required to make an upfront payment of $750,000, which was charged to research and development license costs for the fiscal year ended June 30, 2018. The ActiveSite License Agreement also requires various milestone payments ranging from $1.0 million to $10.0 million when milestone events occur up to an aggregate of $36.0 million of aggregate milestone payments. The first milestone payment for $1.0 million is due after completion of the preclinical work and submission of an IND application to the FDA. The Company is also required to pay royalties equal to 2.0% of any sales of products that use the PKI Program, up to a maximum of $10.0 million in total royalty payments. Through June 30, 2019, no milestone payments and royalties have been incurred. |
CONVERTIBLE NOTES PAYABLE
CONVERTIBLE NOTES PAYABLE | 12 Months Ended |
Jun. 30, 2019 | |
CONVERTIBLE NOTES PAYABLE | |
CONVERTIBLE NOTES PAYABLE | NOTE 5 — CONVERTIBLE NOTES PAYABLE Convertible notes payable are as follows as of June 30, 2019 and 2018 (in thousands): Original Interest Rate Funding Date Stated Default 2019 2018 Fiscal 2018 Notes: Former member of board of directors January 2018 12.0 % 15.0 % (1) $ — $ 500 (2)(3) Former member of board of directors February 2018 15.0 % 15.0 % — 500 (2)(3)(4) Other investors February 2018 12.0 % 15.0 % (1) — 200 (2)(3) Other investors April 2018 12.0 % 15.0 % (1) — 4,140 (2) Less unaccreted discount and issuance costs — (1,915) (5) Net carrying value — 3,425 Note payable, due on demand (6) May 2010 8.0 % 8.0 % 10 10 Total $ 10 $ 3,435 (1) Beginning on July 1, 2018, the interest rate increased from the stated rate of 12.0% to the default rate of 15.0% due to the Company’s failure to make quarterly interest payments. (2) As amended in April 2018, all of the Fiscal 2018 Notes provided that the unpaid principal and accrued interest automatically convert to the class of securities issued in an equity financing for at least $15 million at a 20% discount to the terms set forth in such financing. This feature that enabled conversion at a 20% discount was a contingent BCF that was not calculated and recorded until the financing that triggered conversion was completed. Since the closing of the Series AA Financing resulted in the conversion of the Fiscal 2018 Notes, the contingent BCF was measured and recognized on January 30, 2019 as discussed below under the caption “Beneficial Conversion Feature”. (3) In April 2018, these notes and related warrants were amended to mirror the terms of the Fiscal 2018 Notes issued in April 2018. Accordingly, the Company completed an analysis to determine if changes to the terms of these notes should be accounted for as a troubled debt restructuring, a debt modification or as an extinguishment. Since the future cash flows of the instruments changed by an amount greater than 10%, debt extinguishment accounting was applied. Accordingly, the Company recognized a loss on the extinguishment of debt of approximately $0.6 million. (4) This convertible promissory note contained an embedded derivative for the acceleration of the maturity date if the note was paid prior to maturity, whereby a $25,000 penalty plus all unpaid interest to be accrued through the maturity date was due. The initial measurement of fair value for this embedded derivative liability was $100,000, which was reflected as DDIC. The fair value of this embedded derivative was $74,000 as of June 30, 2018, which resulted in a gain of $26,000 for the fiscal year ended June 30, 2019. This embedded derivative was eliminated upon conversion of the convertible promissory note on January 30, 2019, which resulted in the recognition of a gain of $74,000 for the fiscal year ended June 30, 2019. (5) As discussed below under the caption “Debt Discount and Issuance Costs”, the Company incurred DDIC of $3.2 million related to the issuance of the Fiscal 2018 Notes, of which the unaccreted balance was $1.9 million as of June 30, 2018. (6) This convertible note payable was executed in May 2010 whereby the principal and accrued interest are convertible to Common Stock at a price of $1.02 per share. To date, the holder has not exercised its conversion rights or requested payment. Debt Di s count and Issuance Costs The components of DDIC for the fiscal years ended June 30, 2019 and 2018, are as follows (in thousands, except per share amounts): Warrant Terms Number Exercise Fair Components of DDIC of Shares Price Value Fair value of warrants issued in fiscal 2018: Fiscal 2018 Note holders 12,185 $ 0.52 $ 1,899 Placement Agent 289 $ 0.52 217 Modification of warrant in January 2019 707 0.18 138 Initial fair value of embedded derivative in February 2018 100 Incremental and direct costs of placement in fiscal 2018 204 Total DDIC related to Fiscal 2018 Notes $ 2,558 DDIC is accreted to interest expense using the effective interest method. Accretion expense for the fiscal years ended June 30, 2019 and 2018 amounted to $2.1 million and $0.5 million, respectively. Beneficial Conversion Feature Each of the Fiscal 2018 Notes discussed above contained a mandatory conversion feature that was triggered if the Company completed a qualified financing whereby the notes would automatically convert into the securities issued in the financing at a 20% discount. This feature that enabled conversion at a 20% discount was a contingent BCF that was not calculated and recorded until the financing that triggered conversion was completed. Since the closing of the Series AA Financing resulted in the conversion of the Fiscal 2018 Notes, the contingent BCF was measured and recognized on January 30, 2019. The fair value of the Company’s Common Stock was 0.24 per share on the conversion date for the Fiscal 2018 Notes compared to the effective conversion price of $0.176 per share (due to the 20% discount to the Series AA Financing terms which provide for a conversion price of $0.22 per share). Accordingly, the Company recognized a BCF of approximately $2.2 million as additional interest expense related to the Fiscal 2018 Notes for the fiscal year ended June 30, 2019. Automatic Conversion of Fiscal 2018 Notes The Series AA Financing met the definition of a qualified financing whereby all of the Fiscal 2018 Notes automatically converted for an aggregate principal balance of approximately $5.3 million plus accrued interest of approximately $0.8 million as of January 30, 2019, into an aggregate of 767,519 shares of Series AA Preferred Stock. Pursuant to the terms of the Fiscal 2018 Notes, the conversion price was $8.00 per share of Series AA Preferred Stock, which was a 20% discount to the terms set forth in the Series AA Financing. The conversion of the Fiscal 2018 Notes at a 20% discount resulted in a BCF of approximately $2.2 million as discussed above. As of January 30, 2019, the aggregate principal and accrued interest of approximately $6.1 million converted to Series AA Preferred Stock, as follows (in thousands): Accrued Converted to Ending Date of Borrowing Principal Interest Series AA Balance January 2018 $ 500 $ 95 $ (595) $ — February 2018 700 102 (802) — April 2018 4,140 603 (4,743) — Total $ 5,340 $ 800 $ (6,140) $ — Interest Expense Presented below is a summary of the components of interest expense related to Convertible Notes Payable for the fiscal years ended June 30, 2019 and 2018 (in thousands): 2019 2018 Interest expense at contractual rate $ 672 $ 184 Accretion of discount 2,053 505 Beneficial conversion feature for Fiscal 2018 Notes 2,233 — Total interest expense $ 4,958 $ 689 |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) | 12 Months Ended |
Jun. 30, 2019 | |
STOCKHOLDERS' EQUITY (DEFICIT) | |
STOCKHOLDERS' EQUITY (DEFICIT) | NOTE 6 — STOCKHOLDERS’ EQUITY (DEFICIT) Changes in Authorized Capital Stock The Company held its annual meeting of stockholders on April 24, 2019, whereby the Company’s stockholders approved an amendment to the Certificate of Incorporation to (i) increase the authorized number of shares of Common Stock from 200 million shares to 500 million shares, and (ii) a recission of the previous designation of 15.0 million shares of the Series A Preferred Stock. As a result of this action, the Company has authority to designate and issue up to 20.0 million shares of Preferred Stock as of June 30, 2019. Series AA Preferred Stock Financing In December 2018, two New Investors expressed interest in investing in the Company and affirmed their intent to enter into exclusive diligence and negotiations regarding a potential equity financing (“Transaction”). In exchange for the receipt of a total of $1.5 million ("Exclusivity Payment"), the Company entered into an exclusivity agreement ("Exclusivity") with the New Investors. On January 7, 2019, the parties entered into a purchase agreement for shares of Series AA Preferred Stock whereby the New Investors agreed to purchase shares of newly designated Series AA Preferred Stock (the “Series AA Financing”) for aggregate gross proceeds to the Company of $25.0 million (inclusive of the $1.5 million Exclusivity Payment). On January 18, 2019, the board of directors authorized the designation of 5.0 million shares of the Company’s Preferred Stock as Series AA Preferred Stock. On January 30, 2019, the parties closed the Series AA Financing and the Company issued an aggregate of 2.5 million shares of Series AA Preferred Stock to the New Investors at a purchase price of $10.00 per share for aggregate proceeds of $25.0 million. The Series AA Preferred Stock ranked senior to the Common Stock in the event of a liquidation, dissolution or winding up of the Company. The Series AA Shares had an effective conversion price of approximately $0.22 per share of Common Stock whereby the shares of Series AA Preferred Stock held by the New Investors were immediately convertible, at the option of the holders, into an aggregate of approximately 113.6 million shares of the Company’s Common Stock. The fair value of the Company’s common stock on the issuance date of the Series AA Shares was $0.24 per share which resulted in a BCF of approximately $2.3 million. Since the Series AA Shares are classified as equity instruments, this BCF is treated as an adjustment in computing net loss attributable to common stockholders in Note 11. A condition to closing the Series AA Financing was the resignation of a majority of the Company’s former directors and the appointment of the New Investors as directors whereby the New Investors collectively control the board of directors with two of the three members. On April 24, 2019, The Company’s stockholders approved an increase in the number of authorized shares of Common Stock from 200.0 million shares to 500.0 million shares whereby all 2.5 million shares of Series AA Preferred Stock held by the New Investors automatically converted into approximately 113.6 million shares of the Company’s Common Stock. As of June 30, 2019, the New Investors collectively own 54% of the Company’s Common Stock which resulted in a change of control. The Company agreed to use commercially reasonable efforts to, (i) prepare and file with the Securities and Exchange Commission (the “SEC”) within sixty calendar days after the closing of the Series AA Financing a registration statement under the U.S. Securities Act of 1933, as amended (the “Registration Statement”), to permit the resale of all shares of Common Stock issued upon the conversion of the Series AA shares purchased in the Series AA Financing. The Company also agreed to use commercially reasonable efforts to cause the Registration Statement to be declared effective within ninety calendar days following the closing of the Series AA Financing. The Company filed this Registration Statement with the SEC in August 2019. The Company granted each of the New Investors a call option whereby upon the earlier of (i) December 31, 2020 and (ii) such date that the Company requests the New Investors to provide additional financing, each New Investor may elect to purchase up to $10.0 million of Common Stock at a purchase price equal to the greater of (i) $0.29 per share or (ii) 75% of the volume weighted average closing price of the Company’s Common Stock during the thirty consecutive trading days prior to the date of the notice. As discussed in Note 13, the New Investors exercised the call option on July 23, 2019, resulting in the purchase of an aggregate of approximately 69.0 shares of Common Stock for gross proceeds of $20.0 million at a purchase price of $0.29 per share. Automatic Conversion of Promissory Notes Due to closing of the Series AA Financing for gross proceeds of $25.0 million, the Fiscal 2018 Notes discussed in Note 5 converted for an aggregate of approximately $6.1 million, which consisted of the aggregate principal balance plus accrued interest through January 30, 2019. The Fiscal 2018 Notes were convertible at a discount of 20% from the issuance price paid by the New Investors. Therefore, the total balance of the Fiscal 2018 Notes was exchanged for 767,519 shares of Series A Preferred Stock resulting in an effective issuance price of $8.00 per share to give effect to the 20% discount. This 20% discount is included in the calculation of the BCF discussed in Note 5 which resulted in additional interest expense of $2.2 million for the fiscal year ended June 30, 2019. Upon receipt of shareholder approval for an increase in the number of authorized shares of Common Stock to 500.0 million shares on April 24, 2019, all 767,519 shares of Series AA Preferred Stock held by the former Fiscal 2018 Note holders converted into approximately 34.9 million shares of the Company’s Common Stock. Series AA Conversion Terms The conversion terms for all shares of Series AA Preferred Stock that converted to Common Stock on April 24, 2019, are as follows (in thousands, except share and per share amounts): Number Conversion Value Common Stock Conversion Holder of Shares Per Share Amount Price Shares New Investors 2,500,000 $ 10.00 $ 25,000 $ 0.22 113,637 Fiscal 2018 Note holders 767,519 10.00 7,675 0.22 34,887 Total 3,267,519 $ 32,675 148,524 2017 Private Placement For the fiscal quarter ended September 30, 2017, the Company closed a private placement for the issuance of 4.5 million shares of Common Stock to accredited investors at an offering price of $1.00 per share. The Company received gross proceeds of $4.5 million. Placement agent commissions amounted to $60,000 related to this private placement. Lincoln Park Purchase Agreement In December 2017, we entered into a purchase agreement (the “Purchase Agreement”) and a registration rights agreement (the “Registration Rights Agreement”) with the Lincoln Park Capital Fund, LLC (“Lincoln Park”) pursuant to which Lincoln Park agreed to purchase up to an aggregate of $10.0 million of the Company’s Common Stock (subject to certain limitations) over the term of the agreement that expires in December 2020. As required by the Registration Rights Agreement, the Company filed a registration statement with the SEC under the Securities Act of 1933 to register for resale the shares of Common Stock that have been or may be issued to Lincoln Park under the Purchase Agreement. As consideration for Lincoln Park’s commitment to purchase shares of the Company’s Common Stock under the agreement, the Company issued approximately 345,000 shares of Common Stock with an estimated fair value of $0.3 million in December 2017. Under the terms and subject to the conditions of the Purchase Agreement, the Company has the right, but not the obligation, to sell to Lincoln Park, and Lincoln Park is obligated to purchase up to $10.0 million of shares of the Company’s Common Stock. As contemplated by the Purchase Agreement, and so long as the closing price of the Company’s common stock exceeds $0.40 per share, then the Company may direct Lincoln Park, at its sole discretion to purchase up to 65,000 shares of its Common Stock on any business day, provided that five business day has passed since the most recent purchase. The price per share for such purchases will be equal to the lower of: (i) the lowest sale price on the applicable purchase date and (ii) the arithmetic average of the three lowest closing sale prices for the Company’s Common Stock during the 12 consecutive business days ending on the business day immediately preceding such purchase date (in each case, to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split or other similar transaction that occurs on or after the date of the purchase agreement). The maximum amount of shares subject to any single regular purchase increases as the Company’s share price increases, subject to a maximum of $0.5 million. In addition to regular purchases, the Company may also direct Lincoln Park to purchase other amounts as accelerated purchases or as additional purchases if the closing sale price of the Common Stock exceeds certain threshold prices as set forth in the purchase agreement. In all instances, the Company may not sell shares of its Common Stock to Lincoln Park under the purchase agreement if it would result in Lincoln Park beneficially owning more than 9.99% of its Common Stock. There are no trading volume requirements or restrictions under the purchase agreement nor any upper limits on the price per share that Lincoln Park must pay for shares of Common Stock. The Company’s Common Stock has not exceeded the threshold price of $0.40 per shares for the period from August 2018 through June 2019. The Purchase Agreement and the Registration Rights Agreement contain customary representations, warranties, agreements and conditions to completing future sale transactions, indemnification rights and obligations of the parties. The Company has the right to terminate the Purchase Agreement at any time, at no cost or penalty. During any “event of default” under the Purchase Agreement, all of which are outside of Lincoln Park’s control, Lincoln Park does not have the right to terminate the Purchase Agreement; however, the Company may not initiate any regular or other purchase of shares by Lincoln Park, until such event of default is cured. XOMA Equity Issuance The closing of the debt financing for the Fiscal 2018 Notes on April 3, 2018 was considered to be the initial closing for the Common Stock purchase agreement. Accordingly, the Company issued an aggregate of 8.1 million shares of Common Stock to XOMA with an aggregate fair value of approximately $4.6 million. This amount is included in research and development licensing costs in the accompanying consolidated statement of operations for the fiscal year ended June 30, 2018. |
STOCK-BASED COMPENSATION AND WA
STOCK-BASED COMPENSATION AND WARRANTS | 12 Months Ended |
Jun. 30, 2019 | |
STOCK-BASED COMPENSATION AND WARRANTS | |
STOCK-BASED COMPENSATION AND WARRANTS | NOTE 7 — STOCK-BASED COMPENSATION AND WARRANTS Stock Option Plans The Company currently has two active stock option plans consisting of the 2015 Non-Qualified Stock Option Plan (the “2015 Plan”) and the 2016 Non-Qualified Stock Option Plan, as amended (the “2016 Plan”). The Company also has an aggregate of approximately 2,190,000 stock options outstanding under the 2014 Stock and Incentive Plan (the “2014 Plan”) that terminated on March 21, 2019. Stock options outstanding under the 2014 Plan expire pursuant to their contractual provisions on various dates in 2021. A total of 6,850,000 shares of Common Stock are authorized for awards that may be granted under the 2015 Plan. As of June 30, 2019, approximately 4,155,000 shares of Common Stock remain available for future grants under the 2015 Plan and 2,695,000 shares of Common Stock are subject to currently outstanding stock options. The 2015 Plan is scheduled to terminate in February 2020 whereby no additional awards may be granted after that date. The Company held its annual meeting of stockholders on April 24, 2019, whereby the Company’s stockholders approved an amendment to the 2016 Plan to increase the authorized number of shares of Common Stock available for issuance from 15.0 million shares to 28.0 million shares. As of June 30, 2019, under the 2016 Plan there are 19,020,000 shares of Common Stock available for future grants and awards for 8,980,000 shares are subject to currently outstanding stock options. The 2016 Plan is scheduled to terminate in October 2021 whereby no additional awards may be granted after that date. The following table sets forth a summary of combined stock option activity under the 2015 Plan, the 2016 Plan and the Terminated Plans for the fiscal years ended June 30, 2019 and 2018 (shares in thousands): 2019 2018 Shares Price (1) Term (2) Shares Price (1) Term (2) Outstanding, beginning of fiscal year 19,415 $ 1.55 7.8 21,291 $ 1.65 7.7 Granted 1,125 0.52 255 1.08 Forfeited (6,675) 1.53 (1,881) 1.62 Expired — — (250) 4.50 Outstanding, end of fiscal year 13,865 1.60 6.4 19,415 1.55 7.8 Vested, end of fiscal year 9,604 1.85 5.7 11,399 1.92 6.4 (1) Represents the weighted average exercise price. (2) Represents the weighted average remaining contractual term until the stock options expire. As discussed in Note 13, in July 2019 the Company granted stock options for an aggregate of 34.0 million shares of Common Stock that are not reflected in the table above. The aggregate fair value of stock options for 1,125,000 shares of Common Stock granted for the fiscal year ended June 30, 2019 amounted to approximately $445,000, or $0.40 per share as of the grant date. The aggregate fair value of stock options for 255,000 shares of Common Stock granted for the fiscal year ended June 30, 2018 amounted to approximately $207,000, or $0.81 per share as of the grant date. For the fiscal years ended June 30, 2019 and 2018, the fair value of stock options was estimated on the date of grant using the BSM option-pricing model, with the following weighted-average assumptions: 2019 2018 Grant date fair value of common stock $ 0.52 $ 1.08 Expected volatility 84 % 84 % Risk free interest rate 2.8 % 2.1 % Expected term (years) 7.0 7.0 Dividend yield — % — % Compensation cost is recognized ratably as the options vest which is generally over a period of 48 months from the grant date. Stock-based compensation expense for the fiscal years ended June 30, 2019 and 2018 is included in compensation and benefits under the following captions in the consolidated statements of operations (in thousands): 2019 2018 Research and development $ 538 $ 982 General and administrative 2,098 4,113 Total $ 2,636 $ 5,095 The unrecognized stock-based compensation expense as of June 30, 2019 is approximately $2.7 million and this amount is expected to be recognized over the weighted average remaining vesting period of 1.8 years. As of June 30, 2019 and 2018, there was no intrinsic value associated with any outstanding stock options. Warrants The Company has issued warrants to purchase shares of Common Stock in conjunction with various debt and equity financings and for services. For the fiscal years ended June 30, 2019 and 2018, no warrants were exercised. Presented below is a summary of warrant activity for the fiscal years ended June 30, 2019 and 2018 (shares in thousands): 2019 2018 Shares Price (1) Term (2) Shares Price (1) Term (2) Outstanding, beginning of fiscal year 45,635 $ 1.37 3.4 32,796 $ 1.71 3.7 Warrants issued for: Consulting services — — 650 (3) 1.03 Debt discount for Fiscal 2018 Notes — — 12,185 (4) 0.52 Placement agent debt discount — — 289 (5) 0.52 Modification for debt discount to former member of Board of Directors: Replacement warrant 1,207 (6) 0.18 — — Canceled warrant (500) (6) 0.52 — — Warrant expirations (345) 2.41 (285) 2.43 Outstanding, end of fiscal year 45,997 1.34 2.3 45,635 1.37 3.4 (1) Represents the weighted average exercise price. (2) Represents the weighted average remaining contractual term until the warrants expire. (3) Consists of three warrants for an aggregate of 650,000 shares granted to consultants for services that were immediately exercisable. The commitment date fair value of approximately $0.5 million is included in consulting expense for the fiscal year ended June 30, 2018. The fair value of these warrants was determined on the commitment date using the BSM option-pricing model. Key weighted average assumptions included the grant date fair value of Company’s Common Stock of $1.07 per share, expected volatility of 82%, a risk-free interest rate of 2.1%, and a remaining term of 6.5 years. (4) The aggregate commitment date fair value of the warrants issued to convertible note holders and the placement agent was approximately $3.8 million. The warrants and debt were recorded based on their relative fair value which resulted in a debt discount of $2.5 million related to the Fiscal 2018 Notes discussed in Note 5. The fair value of these warrants was determined on the commitment date using the BSM option-pricing model. Key weighted average assumptions included the grant date fair value of Company’s Common Stock of $0.45 per share, expected volatility of 96%, a risk-free interest rate of 2.8%, and an estimated term of 5.0 years. (5) Pursuant to the terms of the warrants, the exercise price was not established until June 30, 2018 so the fair value of these warrants was determined using a lattice option-pricing model. Key weighted average assumptions included the grant date fair value of Company’s Common Stock of $0.58 per share, expected volatility of 86%, a risk-free interest rate of 2.8%, a remaining term of 10 years, and a discount rate of 20%. (6) As discussed in Note 10, in January 2019 the Company agreed to modify a warrant originally issued in June 2018 for 500,000 shares that was exercisable at $0.52 per share. This warrant was originally issued in connection with one of the Fiscal 2018 Notes issued to a former member of the Board of Directors. The difference between the fair value of the modified warrant and the fair value of the canceled warrant amounted to $138,000, which was accounted for as an additional debt discount that was charged to interest expense upon repayment of the Fiscal 2018 Notes on January 30, 2019. Key assumptions for valuation of the modified warrant and the canceled warrant included the fair value of Company’s Common Stock on the modification date of $0.23 per share, expected volatility of 100%, a risk-free interest rate of 2.5%, and an estimated remaining term of 4.0 years. In order to calculate the fair value of the warrants discussed above, certain assumptions were made regarding components of the BSM and lattice valuation models, including volatility of the Company’s Common Stock trading price which was estimated based on several peer companies, the remaining term of the warrant, and the risk-free interest rate that coincides with the remaining term. For the valuation of all of the warrants discussed above, the Company assumed that no dividends would be paid over the expected remaining term since the Company has never paid dividends and does not expect to pay dividends in the future. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Jun. 30, 2019 | |
INCOME TAXES | |
INCOME TAXES | NOTE 8 — INCOME TAXES The Tax Act In December 2017, the U.S. Tax Cuts and Jobs Act of 2017 (“Tax Act”) was enacted into law which significantly revises the Internal Revenue Code of 1986, as amended. The newly enacted federal income tax law, among other things, contains significant changes to corporate taxation, including a flat corporate tax rate of 21%, limitation of the tax deduction for interest expense to 30% of adjusted taxable income, limitation of the deduction for newly generated net operating losses to 80% of current year taxable income and elimination of net operating loss (“NOL”) carrybacks, future taxation of certain classes of offshore earnings regardless of whether they are repatriated, immediate deductions for certain new investments instead of deductions for depreciation expense over time, and modifying or repealing many business deductions and credits beginning in calendar 2018. As a result of the Tax Act, the corporate tax rate decreased from a top marginal rate of 35% that was effective through December 31, 2017 to a flat rate of 21% effective January 1, 2018. Accordingly, a decrease of $8.5 million in the Company’s deferred income tax assets was recognized as of December 31, 2017, and this amount was fully offset by a corresponding decrease in the valuation allowance. Income Tax Expense For the fiscal years ended June 30, 2019 and 2018, the reconciliation between the income tax benefit computed by applying the statutory U.S. federal income tax rate to the pre-tax loss before income taxes, and total income tax expense recognized in the financial statements is as follows (in thousands): 2019 2018 Income tax benefit at statutory U.S. federal rate $ 6,394 $ 8,078 Income tax benefit attributable to U.S. states 1,876 985 Non-deductible interest and other expenses (1,045) (12) Transition impact of Tax Act — (8,490) Stock option expirations (1,484) (645) Other (328) — Change in valuation allowance (5,413) 84 Total income tax expense $ — $ — For the fiscal years ended June 30, 2019 and 2018, the Company did not recognize any current income tax expense or benefit due to a full valuation allowance on its deferred income tax assets. Deferred Income Tax Assets and Liabilities As of June 30, 2019 and 2018, the income tax effects of temporary differences that give rise to significant deferred income tax assets and liabilities are as follows (in thousands): 2019 2018 Deferred income tax assets: Net operating loss carryforwards $ 20,016 $ 15,563 Stock-based compensation 3,716 4,162 Start-up and organizational expenses 338 334 Property and equipment — 515 Accesed expenses and other 1,598 467 Total deferred income tax assets 25,668 21,041 Valuation allowance for deferred income tax assets (25,656) (20,243) Net deferred income tax assets 12 798 Deferred income tax liability: Federal benefit for state deferred income taxes and other (12) (798) Net deferred income tax assets $ — $ — For the fiscal year ended June 30, 2019, the valuation allowance increased by $5.4 million, primarily as a result of the increase in net operating losses. In assessing the realizability of deferred income tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. NOL Carryforwards and Other Matters The Company files income tax returns in the U.S. federal jurisdiction, and the states of Colorado and California. The Company’s federal and state tax years for the 2016 fiscal year and forward are subject to examination by taxing authorities. As of June 30, 2019, the Company has U.S. federal NOL carryforwards of approximately $81 million, of which approximately $41 million does not expire and $40 million will begin to expire in 2030. Additionally, the Company has a Colorado NOL carryforward of approximately $68 million that starts to expire in 2030. Federal and state laws impose substantial restrictions on the utilization of NOL carryforwards in the event of an ownership change for income tax purposes, as defined in Section 382 of the Internal Revenue Code. Pursuant to Internal Revenue Code (“IRC”) Section 382, annual use of the Company’s net operating loss carryforwards may be limited in the event a cumulative change in ownership of more than 50% occurs within a three-year period. The Company has not completed an IRC Section 382 analysis regarding the limitation of net operating loss carryforwards. However, it is possible that past ownership changes will result in the inability to utilize a significant portion of the Company’s net operating loss carryforward that was generated prior to any change of control. The Company’s ability to use its remaining net operating loss carryforwards may be further limited if the Company experiences a Section 382 ownership change in connection with future changes in the Company’s stock ownership. The Company did not have any unrecognized tax benefits as of June 30, 2019 and 2018. The Company’s policy is to account for any interest expense and penalties for unrecognized tax benefits as part of the income tax provision. The Company does not anticipate that unrecognized tax benefits will significantly increase or decrease within the next twelve months. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Jun. 30, 2019 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 9 — COMMITMENTS AND CONTINGENCIES Financial Advisory Agreement In June 2019, the Company entered into a financial advisory agreement whereby the Company agreed to pay a fee of (i) 6.0% of up to $20.0 million of gross proceeds received from the New Investors under the call option discussed in Note 6, and (ii) 6.0% of the gross proceeds from a private placement consisting of between $20 million and $30 million of equity or equity equivalent securities. Under the financial advisory agreement, no commissions are payable for any subsequent issuances of equity or equity equivalent securities issued to the New Investors. In addition, the Company agreed to reimburse legal fees of the financial advisors up to $60,000 plus other reasonable out-of-pocket expenses. Through June 30, 2019, no securities have been issued and no fees have been incurred under the financial advisory agreement. However, as discussed in Note 13 offering costs of approximately $1.4 million were incurred under this agreement with respect to equity issuances in July and August 2019. Operating Leases On January 25, 2019, the Company entered into a lease for a new headquarters location in Redwood City, California. The leased space consists of approximately 3,500 square feet of office space and provides for monthly rent of approximately $21,000 through the expiration date in March 2022. The Company provided a security deposit of $31,000 which is refundable upon expiration of the lease. On February 7, 2019, the Company entered into a lease for ancillary office space in Bend, Oregon. The lease space consists of approximately 1,500 square feet of office space and provides for monthly rent of approximately $2,700 through the expiration date in February 2021. The Company provided a security deposit of $3,700 which is refundable upon expiration of the lease. The table below summarizes the Company’s operating lease commitments under these leases as of June 30, 2019 (in thousands): Fiscal Year Ending June 30, 2020 $ 275 2021 272 2022 170 $ 717 Employment Agreements As of June 30, 2019, the Company was subject to employment agreements with two executive officers that provide for aggregate annual base salaries of $840,000. In the event the Company terminates employment of the executive officers without cause, severance benefits include (i) between one and three years of base salary, (ii) 150% of annual target bonuses applicable to the terminated executive, and (iii) continuation of certain medical and dental benefits. In addition, vesting is accelerated for unvested stock options that would have otherwise vested during the period that the severance benefits are paid out. Lease Terminations On December 14, 2018, the Company entered into surrender agreements with its landlord, sub-landlord and sub-lessees to terminate all remaining lease and sub-lease obligations at the Company’s former Colorado facilities. In connection with this transaction, the Company was relieved of its remaining obligations under the leases and relinquished its rights under the lease and sublease agreements whereby no cash was exchanged by the parties. Accordingly, the Company recognized a net gain of approximately $168,000. This gain resulted from the elimination of net deferred rent obligations of $200,000 and the sublease security deposit of $25,000 for a total of $225,000; partially offset by forfeiture of the Company’s security deposit for $57,000 to arrive at the net gain of $168,000. As of June 30, 2019, the Company has no remaining lease commitments for its former facilities in Colorado. 401(k) Plan The Company has a defined contribution employee benefit plan under section 401(k) of the Internal Revenue Code (the “401(k) Plan”). The 401(k) Plan covers all eligible employees who are entitled to participate six months after commencement of employment. The Company matches contributions up to 4% of the participating employee’s compensation with such matching contributions vested immediately. Total contributions by the Company to the 401(k) Plan amounted to approximately $110,000 and $189,000 for the fiscal years ended June 30, 2019 and 2018, respectively. Legal Matters From time to time, the Company may be involved in litigation relating to claims arising out of operations in the normal course of business. As of June 30, 2019, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the Company’s results of operations. At each reporting period, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under ASC 450, Contingencies . Legal fees are expensed as incurred. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 10 — RELATED PARTY TRANSACTIONS On February 26, 2018, the Company issued a secured convertible promissory note and warrants for $0.5 million that was payable to a member of the Board of Directors. On April 3, 2018, the Company issued a second convertible promissory note and warrants for $0.5 million to this same member of the Board of Directors. This second promissory note replaced a note with similar terms that was issued on January 25, 2018. On February 16, 2019, this board member resigned in connection with the Series AA Financing discussed in Note 6. During the fiscal quarter ended March 31, 2018, the Company issued warrants in connection with the Fiscal 2018 Notes whereby the fair value of the warrants was accounted for as a debt discount as discussed in Note 5. In January 2019, the Company modified one of the outstanding warrants held by the same member of the Board of Directors discussed above. The modification resulted in an increase in the number of shares subject to the warrant from 0.5 million shares to approximately 1.2 million shares, and a decrease in the exercise price from $0.52 per share to $0.18 per share. The Company measured the fair value of this warrant immediately before and immediately after the modification and recognized the change in fair value of approximately $138,000 as an additional debt discount. Upon conversion of the related Fiscal 2018 Note on January 30, 2019, the debt discount was fully accreted to interest expense. As discussed in Note 13, on July 23, 2019 the New Investors agreed to purchase an aggregate of approximately 69.0 million shares at an issuance price of $0.29 per share for gross proceeds of $20.0 million. This purchase was made pursuant to the terms of the call option that was issued in connection with the Series AA financing discussed in Note 6. After this purchase, the New Investors owned an aggregate of 64% of the Company’s outstanding shares of Common Stock. For the fiscal year ended June 30, 2018, the Company incurred investor relation expenses of $33,000 and general and administrative expenses of $68,000 for services performed by related parties. |
NET LOSS PER SHARE
NET LOSS PER SHARE | 12 Months Ended |
Jun. 30, 2019 | |
Net Loss Per Share | |
Net Loss Per Share | NOTE 11 — NET LOSS PER SHARE Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period. The calculation of net loss attributable to common stockholders for the year ended June 30, 2019 reflects the BCF related to the issuance of Series AA Preferred Stock to the New Investors discussed in Note 6, as follows: 2019 2018 Net loss $ (30,446) $ (29,862) Beneficial conversion feature (2,273) — Net loss attributable to common stockholders $ (32,719) $ (29,862) For the years ended June 30, 2019 and 2018, basic and diluted net loss per share were the same since all common stock equivalents were anti-dilutive. As of June 30, 2019 and 2018, the following potential common stock equivalents were excluded from the computation of diluted net loss per share since the impact of inclusion was anti-dilutive (in thousands): 2019 2018 Stock options 13,865 19,415 Warrants 45,997 45,635 Total 59,862 65,050 |
FINANCIAL INSTRUMENTS AND SIGNI
FINANCIAL INSTRUMENTS AND SIGNIFCANT CONCENTRATIONS | 12 Months Ended |
Jun. 30, 2019 | |
FINANCIAL INSTRUMENTS AND SIGNFICANT CONCENTRATIONS | |
FINANCIAL INSTRUMENTS AND SIGNFICANT CONCENTRATIONS | NOTE 12 — FINANCIAL INSTRUMENTS AND SIGNFICANT CONCENTRATIONS Fair Value Measurements Fair value is defined as the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. When determining fair value, the Company considers the principal or most advantageous market in which it transacts and considers assumptions that market participants would use when pricing the asset or liability. The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair measurement: Level 1—Quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. Level 2—Other than quoted prices included in Level 1 that are observable for the asset and liability, either directly or indirectly through market collaboration, for substantially the full term of the asset or liability. Level 3—Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any market activity for the asset or liability at measurement date. Due to the relatively short maturity of the respective instruments, the fair value of cash and cash equivalents, accounts payable and accrued liabilities approximated their carrying values as of June 30, 2019 and 2018. The Company did not have any other assets and liabilities measured at fair value as of June 30, 2019. The Company’s embedded derivative liability discussed in Note 5 was the only liability as of June 30, 2018 that was carried at fair value on a recurring basis. The Company’s embedded derivative liability was recorded at fair market value and was classified within Level 3 of the fair value hierarchy. Fair value was estimated using the “with” and “without” method. Accordingly, the note payable was first valued with the embedded derivatives (the “with” scenario) and subsequently valued without the embedded derivatives (the “without” scenario). The fair value of the embedded derivatives was estimated as the difference between these two scenarios. The fair values were determined using the income approach, specifically the yield method. As of June 30, 2018, key Level 3 assumptions and estimates used in the valuation of the embedded derivatives included an assessment of the probability of early prepayment of the convertible note payable, the remaining term to maturity of approximately 0.7 years and a discount rate of 15.0%. The Company’s policy is to recognize asset or liability transfers among Level 1, Level 2 and Level 3 as of the actual date of the events or change in circumstances that caused the transfer. During the fiscal years ended June 30, 2019 and 2018, the Company had no transfers of its assets or liabilities between levels of the fair value hierarchy. Significant Concentrations Financial instruments that subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents. The Company maintains its cash and cash equivalents at high-quality financial institutions. Cash deposits often exceed the amount of federal insurance provided on such deposits. As of June 30, 2019, the Company had cash and cash equivalents with a single financial institution with a balance of $11.6 million. The Company has never experienced any losses related to its investments in cash and cash equivalents. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Jun. 30, 2019 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 13 — SUBSEQUENT EVENTS Financing Activities As discussed in Note 6, the Company granted each of the New Investors a call option to provide additional financing whereby each New Investor may elect to purchase up to $10.0 million of Common Stock at a purchase price equal to the greater of (i) $0.29 per share or (ii) 75% of the volume weighted average closing price (“VWAP”) of the Company’s Common Stock during the thirty consecutive trading days prior to the date of the notice. As discussed in Note 9, in June 2019 the Company entered into a financial advisory agreement to undertake a private placement of (i) the shares of Common Stock issuable under the call option issued to the New Investors for a total of $20.0 million, plus (ii) between approximately $20 million and $30 million of equity or equity equivalent securities to be issued to other investors. On July 23, 2019, the Company entered into a purchase agreement whereby the New Investors exercised their call option to purchase an aggregate of approximately 69.0 million shares of Common Stock for gross cash proceeds of $20.0 million. Since VWAP for the previous thirty consecutive trading days was $0.20 per share, the New Investors exercised the call option at a purchase price of $0.29 per share. In addition, during July and August 2019 other investors purchased an aggregate of approximately 14.0 million shares of Common Stock at a purchase price of $0.29 per share for gross cash proceeds of $4,050,000. Pursuant to the financial advisory agreement, the Company agreed to pay a fee of 6.0% of the gross proceeds received from these private placements. The total advisory fees related to these issuances in July and August 2019 amounted to approximately $1.4 million, resulting in net proceeds of $22.6 million. As discussed in Note 4, the completion of these financings resulted in the obligation to make Early Payments of approximately $3.4 million under the License Agreement with Xoma. The Early Payments were paid in August 2019 and eliminated the requirement to make Future Cash Payments that would have otherwise been due on September 30, 2020 for $2.0 million and on June 30, 2020 for approximately $1.4 million. Restricted Funds In connection with the private placement discussed above, one of the investors purchased approximately 13.1 million shares of Common Stock for gross proceeds of $3.8 million. Pursuant to a separate agreement with the investor, the Company agreed to make expenditures totaling $3.8 million prior to August 2020 for qualified research and development activities, and for the Company’s planned uplisting to a national stock exchange. Unaudited Pro Forma Disclosure Presented below is an unaudited pro forma balance sheet that gives effect to the Financing Activities and Early Payments discussed above, as if these events had occurred on June 30, 2019: Unaudited Pro Forma Adjustments Equity Financings Offering Xoma Early Unaudited Historical New Investors Other Costs Payments Pro Forma Assets Cash, cash equivalents and restricted cash $ 11,573 $ 20,000 (1) $ 4,050 (2) $ (1,443) (3) $ (3,391) (4) $ 30,789 Prepaid expenses and other 571 — — — — 571 Non-current assets 108 — — — — 108 Total assets $ 12,252 $ 20,000 $ 4,050 $ (1,443) $ (3,391) $ 31,468 Liabilities and Stockholders' Equity Current liabilities $ 8,379 $ — $ — $ — $ (1,391) (4) $ 6,988 Non-current liabilities 2,121 — — — (2,000) (4) 121 Total liabilities 10,500 — — — (3,391) 7,109 Stockholders equity: Common Stock 210 69 (1) 14 (2) — — 293 Additional paid-in capital 128,445 19,931 (1) 4,036 (2) (1,443) (3) — 150,969 Accumulated deficit (126,903) — — — — (126,903) Total stockholders' equity 1,752 20,000 4,050 (1,443) — 24,359 Total liabilities and stockholders' equity $ 12,252 $ 20,000 $ 4,050 $ (1,443) $ (3,391) $ 31,468 Shares of Common Stock outstanding 210,390 68,966 (1) 13,965 (2) — — 293,321 (1) Gives effect to the issuance of 69.0 million shares in a private placement of Common Stock to the New Investors for gross proceeds of $20.0 million. (2) Gives effect to the issuance of approximately 14.0 million shares of Common Stock to other investors in the private placement for gross proceeds of $4.1 million. (3) Gives effect to the financial advisory fees payable at 6.0% of the gross proceeds from the issuance of shares in the private placement. (4) Gives effect to the Early Payments to Xoma based on 15% of the net proceeds from equity financings of $22.6 million. Employment Agreements On July 31, 2019, the Board of Directors approved entering into three employment agreements with officers of the Company that provide for aggregate annual base salaries of approximately $1.0 million plus eligibility for performance bonuses up to between 25% and 30% of annual compensation. This employment agreements may be terminated by the Company at any time with or without cause. If termination occurs within one year after a change of control, then the officers are entitled to a severance payment equal to their respective annual base salaries which range from $280,000 to $365,000. On July 31, 2019, the Company also entered into an employment agreement with the Company’s former chief accounting officer that provided for an annual base salary of $265,000. This agreement was terminated in August 2019. 2019 Equity Incentive Plan On July 31, 2019, the Company’s Board of Directors adopted the 2019 Non Qualified Stock Option Plan (the “2019 Plan”). The 2019 Plan provides for the authority to grant 15.0 million shares of the Company’s Common Stock to employees, officers, non-employee directors, consultants, independent contractors, or advisors of the Company. Options granted under the 2019 Plan are limited to non-qualified stock options. The 2019 Plan is administered by the Board of Directors or a committee designated by the Board, who have the authority to determine the employees, officers, non-employee directors, consultants, independent contractors, or advisors to whom options will be granted, the vesting rights, and the terms and conditions of each option that is granted. Options granted pursuant to the 2019 Plan are exercisable no later than ten years after the date of grant. The exercise price per share of common stock for options granted pursuant to the 2019 Plan shall be determined by the Board or such committee designated by the Board. The 2019 Plan will terminate on July 31, 2029. Stock Option Grants On July 31, 2019, the Board of Directors granted stock options for an aggregate of approximately 34.0 million shares of Common Stock to certain officers and employees at an exercise price of $0.29 per share. The closing price of the Company’s shares of Common Stock on the date of grant was approximately $0.21 per share. The option grants were designated for 19.0 million shares under the 2016 Plan and 15.0 million shares under the 2019 Plan. Presented below is a summary of the number of options granted to executive officers and other employees: Time-Based Vesting Performance Total Exercise Number of Shares Vesting Shares Price Vested Unvested Shares Granted Executive officers $ 0.29 3,588 11,562 (1) 7,550 (2) 22,700 Other employees 0.29 921 6,629 (1) 3,700 (2) 11,250 Total 4,509 18,191 11,250 33,950 (1) Stock options are subject to time-based vesting in two tranches, whereby (i) 25% of such options are immediately exercisable for employees who have been employed by the Company for more than one year, and for employees that have been employed by the Company less than one year, 25% of such options will vest on the one year anniversary of the employee’s start date; and (ii) the remaining 75% of the stock options will vest ratably over a period of 36 months after vesting of the initial 25% tranche. (2) Vesting of these stock options is subject to achievement of performance milestones whereby such options will vest ratably over a period of 36 months beginning when all of the following have occurred: (i) the Company achieves a listing for its shares of Common Stock on a national stock exchange; (ii) the Company’s closing stock price exceeds $0.58 per share for 20 trading days in any consecutive 30 day period within 4 years of the date of the option grant, and (iii) the option recipient having completed at least one year of employment with the Company. In August 2019, the Company’s chief accounting officer terminated employment which resulted in forfeiture of stock options shown in the table above with time-based vesting for 0.8 million shares and performance vesting for 0.4 million shares. Accrued Bonus Payments On July 31, 2019, the Board of Directors approved cash bonus payments to three executive officers for past services totaling $448,000. The liability to make these payments is included in accrued compensation and benefits in the consolidated balance sheet as of June 30, 2019. In August 2019, the Company paid the cash bonus payments to the three executive officers. Master Services Agreement Effective July 1, 2019, the Company entered into a Master Services Agreement (“MSA”) with the New Investors whereby certain employees of the Company will provide services on behalf of, and at the direction of, the New Investors. The services relate to an existing long acting growth hormone program being advance by the New Investors. This program is referred to as GX-H9, and the objective of the MSA is to assist the New Investors to advance GX-H9 to Phase 3 studies in the U.S. and Europe. Pursuant to the MSA, the New Investors agreed to reimburse the Company for future services at a fixed rate of $200 per hour spent by the Company’s designated employees. Reverse Stock Split On August 2019, the Company’s Board of Directors approved a reverse stock split (the “Reverse Stock Split”) that is subject to stockholder approval at a special meeting that is expected to occur in 2019. If approved by stockholders, the Board of Directors would then have the ability at any time through September 25, 2020 to execute the Reverse Stock Split and set the exchange ratio between 20 and 100 shares of the Company’s outstanding Common Stock, $0.001 par value per share, into one issued and outstanding share of Common Stock, without any change in the par value per share or the number of shares of common stock authorized. If the Reverse Stock Split is subsequently implemented, the number of shares subject to outstanding stock options and warrants will also be adjusted with a corresponding adjustment to the related exercise prices. |
NATURE OF OPERATIONS AND SUMM_2
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Jun. 30, 2019 | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Nature of Operations | Nature of Operations Rezolute, Inc. (the “Company”) is a clinical stage biopharmaceutical company incorporated in Delaware in 2010. The Company has one wholly owned subsidiary, AntriaBio Delaware, Inc. (“Antria Delaware”). |
Consolidation | Consolidation The accompanying consolidated financial statements include the accounts of the Company and Antria Delaware. All significant intercompany balances and transactions have been eliminated in consolidation. |
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Certain amounts in the previously issued comparative financial statements for fiscal 2018 have been reclassified to conform to the current fiscal 2019 financial statement presentation. These reclassifications had no effect on the previously reported net loss, working capital, cash flows and stockholders’ equity (deficit). Comprehensive income (loss) is defined as net income (loss) plus other comprehensive income (loss). Other comprehensive income (loss) is comprised of revenues, expenses, gains, and losses that under GAAP are reported as separate components of stockholders’ equity (deficit) instead of net income (loss). For the fiscal years ended June 30, 2019 and 2018, the only component of comprehensive loss was the Company’s net loss. The Company’s Chief Executive Officer also serves as the Company’s chief operating decision maker (the “CODM”) for purposes of allocating resources and assessing performance based on financial information of the Company. Since its inception, the Company has determined that its activities as a clinical stage biopharmaceutical company are classified as a single reportable operating segment. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts in the consolidated financial statements and the accompanying notes. The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes are reasonable under the circumstances, to determine the carrying values of assets and liabilities that are not readily apparent from other sources. The Company’s significant accounting estimates include, but are not necessarily limited to, estimated useful lives and impairment of fixed assets and intangible assets, fair value of share-based payments and warrants, fair value of derivative instruments, management’s assessment of going concern, estimates of the probability and potential magnitude of contingent liabilities, and the valuation allowance for deferred tax assets due to continuing and expected future operating losses. Actual results could differ from those estimates. |
Risks and Uncertainties | Risks and Uncertainties The Company's operations may be subject to significant risk and uncertainties including financial, operational, regulatory and other risks associated with a clinical stage company, including the potential risk of business failure as discussed further in Note 2. |
Cash and Cash Equivalents | Cash and Cash Equivalents All highly liquid investments purchased with an original maturity of three months or less that are freely available for the Company’s immediate and general business use are classified as cash and cash equivalents. Cash and cash equivalents consist primarily of demand deposits with financial institutions. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, as follows: Furniture and fixtures 5 - 7 years Leasehold improvements 5 - 7 years Laboratory equipment 3 - 15 years Leasehold improvements are amortized over the remaining lease term or the estimated useful life of the asset, whichever is shorter. Depreciation commences when assets are initially placed into service for their intended use. Maintenance and repairs are expensed as incurred. |
Intangible Assets | Intangible Assets Intangible assets consist of patents and are recorded at the estimated acquisition date fair value. Such costs are being amortized over 11 years which is the life of the patents at the time they were acquired. Amortization expense related to intangible assets amounted to approximately $7,000 for each of the fiscal years ended June 30, 2019 and 2018. Future amortization expense is expected to be approximately $7,000 for each of the next five fiscal years. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Impairment exists for property and equipment and identifiable intangible assets if the carrying amounts of such assets exceed the estimates of future net undiscounted cash flows expected to be generated by such assets. An impairment charge is recognized for the amount by which the carrying amount of the asset, or asset group, exceeds its fair value. |
Debt Discounts and Issuance Costs | Debt Discounts and Issuance Costs Debt discounts and issuance costs (“DDIC”) incurred to obtain new debt financing or modify existing debt financing consist of incremental direct costs incurred for professional fees and due diligence services. If convertible notes are issued in conjunction with warrants, the Company allocates the proceeds to each component using a relative fair value. DDIC are presented in the accompanying consolidated balance sheets as a reduction in the carrying value of the debt and are accreted to interest expense using the effective interest method. When debt arrangements are amended, the revised terms are evaluated to determine if the amendment should be accounted for as a troubled debt restructuring, a modification or an extinguishment. If the Company determines that the lender has provided a concession and the Company is experiencing financial difficulties, treatment as a troubled debt restructuring would be required where a gain would generally be recognized. If the Company concludes that accounting as a modification is required, then any costs incurred on behalf of the lenders are accounted for as additional DDIC. If the Company concludes that accounting as an extinguishment is required, an extinguishment charge is measured on the date of the amendment based on the amount by which the fair value of the new debt instrument exceeds the net carrying value of the original debt instrument. |
Beneficial Conversion Features | Beneficial Conversion Features A beneficial conversion feature (“BCF”) is a non-detachable conversion feature that is “in the money” at the commitment date, which requires recognition of interest expense for underlying debt instruments and a deemed dividend for underlying equity instruments. A conversion option is in the money if the effective conversion price is lower than the commitment date fair value of a share into which it is convertible. A contingent BCF feature is measured using the commitment date security price but is not recognized in earnings until the contingency is resolved. |
Research and Development Costs | Research and Development Costs Research and development costs are expensed as incurred. Intangible assets for in-licensing costs incurred under license agreements with third parties are charged to expense, unless the licensing rights have separate economic value in alternative future research and development projects or otherwise. |
Stock-Based Compensation | Stock-Based Compensation The Company measures the fair value of employee and director services received in exchange for all equity awards granted, including stock options, based on the fair market value of the award as of the grant date. The Company computes the fair value of stock options using the Black-Scholes-Merton (“BSM”) option pricing model and recognizes the cost of the equity awards over the period that services are provided to earn the award, usually the vesting period. For awards granted which contain a graded vesting schedule, and the only condition for vesting is a service condition, compensation cost is recognized as an expense on a straight-line basis over the requisite service period as if the award was, in substance, a single award. The Company recognizes the impact of forfeitures in the period that the forfeiture occurs, rather than estimating the number of awards that are not expected to vest in accounting for stock-based compensation. |
Options and Warrants for Non-Employee Services | Options and Warrants for Non-Employee Services The Company accounts for stock options and warrants granted to non-employees by determining the fair value of the equity instrument issued on the commitment date, with expense recognized over the service period. Prior to the establishment of the commitment date, the Company continues to remeasure the fair value of the award, resulting in the recognition of subsequent gains and losses until the commitment date is achieved. The Company estimates fair value of non-employee awards using the BSM option pricing model. |
Derivatives | Derivatives When the Company enters into a financial instrument such as a debt or equity agreement (the “host contract”), the Company assesses whether the economic characteristics of any embedded features are clearly and closely related to the primary economic characteristics of the remainder of the host contract. When it is determined that (i) an embedded feature possesses economic characteristics that are not clearly and closely related to the primary economic characteristics of the host contract, and (ii) a separate, stand-alone instrument with the same terms would meet the definition of a financial derivative instrument and cannot be classified in stockholders’ equity, then the embedded feature is bifurcated from the host contract and accounted for as a derivative instrument. The estimated fair value of the derivative feature is recorded separately from the carrying value of the host contract, with subsequent changes in the estimated fair value recorded as a non-operating gain or loss in the Company’s consolidated statements of operations. |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method. Under this method, deferred income tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using enacted tax rates and laws that are expected to be in effect when the differences are expected to be recovered or settled. Realization of deferred income tax assets is dependent upon future taxable income. A valuation allowance is recognized if it is more likely than not that some portion or all of a deferred income tax asset will not be realized based on the weight of available evidence, including expected future earnings. The Company recognizes an uncertain tax position in its financial statements when it concludes that a tax position is more likely than not to be sustained upon examination based solely on its technical merits. Only after a tax position passes the first step of recognition will measurement be required. Under the measurement step, the tax benefit is measured as the largest amount of benefit that is more likely than not to be realized upon effective settlement. This is determined on a cumulative probability basis. The full impact of any change in recognition or measurement is reflected in the period in which such change occurs. Interest and penalties related to income taxes are recognized in the provision for income taxes. |
Loss Per Common Share | Loss Per Common Share Basic net loss per common share is computed by dividing the net loss applicable to common stockholders by the weighted average number of common shares outstanding for each period presented. Net loss applicable to common stockholders is further adjusted to deduct BCFs that arise from deemed dividends as discussed above. Diluted net loss per common share is computed by giving effect to all potential shares of Common Stock, including stock options, convertible debt, Series AA Preferred Stock and warrants, to the extent dilutive. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Standards . The following accounting standards were adopted during the fiscal year ended June 30, 2019: In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Improvements to Employee Share-Based Payment , aimed at simplifying the accounting for share-based transactions. The standard included modifications to the accounting for income taxes upon vesting or settlement of equity awards, employer tax withholding on share-based compensation and financial statement presentation of excess tax benefits. The Company decided to recognize forfeitures in the period that the forfeiture occurs rather than estimating the number of awards that are not expected to vest in accounting for stock-based compensation. ASU 2016-09 was effective for the Company on July 1, 2018 and the adoption did not have a material impact on the Company’s consolidated financial statements. In January 2016, the FASB issued ASU 2016-01, Financial Instruments — Overall: Recognition and Measurement of Financial Assets and Financial Liabilities , which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. ASU 2016-01 was effective for the Company on July 1, 2018. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements. In May 2017, the FASB issued ASU 2017-9, Compensation — Stock Compensation (Topic 718): Scope of Modification Accounting . This ASU includes guidance on what changes to share-based payment awards would require modification accounting. The Company adopted this ASU on July 1, 2018. The adoption of the new provisions did not have a material impact on the Company’s financial condition or results of operations. Standards Required to be Adopted in Future Years. The following accounting standards are not yet effective; management has not completed its evaluation to determine the impact that adoption of these standards will have on the Company’s consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 amends the guidance on the impairment of financial instruments. This update adds an impairment model (known as the current expected credit losses model) that is based on expected losses rather than incurred losses. Under the new guidance, an entity recognizes, as an allowance, its estimate of expected credit losses. In November 2018, ASU 2016-13 was amended by ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments – Credit Losses. ASU 2018-19 changes the effective date of the credit loss standards (ASU 2016-13) to fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Further, the ASU clarifies that operating lease receivables are not within the scope of ASC 326-20 and should instead be accounted for under the new leasing standard, ASC 842. The Company has not yet determined the effect that ASU 2018-19 will have on its results operations, balance sheets or financial statement disclosures. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This ASU requires the Company to recognize lease assets and lease liabilities on the balance sheet and also disclose key information about leasing arrangements. Early adoption is permitted, and the new standard was required to be adopted retrospectively to each prior reporting period presented upon initial adoption. However, in July 2018 the FASB issued ASU No. 2018-11 Targeted Improvements , which provides lessees the option to apply the new leasing standard to all open leases as of the adoption date by recognizing a cumulative-effect adjustment to accumulated deficit in the period of adoption without restating prior periods. The Company expects the primary impact of adopting this standard will result in the recognition of right-of-use assets and right-of-use liabilities for the discounted present value of the lease commitments summarized in Note 9. The Company intends to utilize the transition approach set forth in ASU No. 2018-11 upon adoption of ASU No. 2016-02 which is required on July 1, 2019. The expected impact of adoption to be reflected in the Company’s consolidated financial statements for the fiscal quarter ending September 30, 2019, is as follows (in thousands): Right-of-use assets recorded under new standard $ 605 Right-of-use liabilities recorded under new standard: Current $ 227 Long-term 406 Total 633 Eliminate deferred rent liability under current accounting standard (28) Net increase in liabilities due to adoption of new standard $ 605 In June 2018, the FASB issued ASU 2018-07, “ Compensation — Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting ,” which expands the scope of ASC 718 to include share-based payment transactions for acquiring goods and services from non-employees. An entity should apply the requirements of ASC 718 to non-employee awards except for specific guidance on inputs to an option pricing model and the attribution of cost. The new guidance is effective for fiscal years, and interim reporting periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company is evaluating the effects of the adoption of this guidance and currently expects to adopt this guidance for the fiscal year ending June 30, 2020. |
NATURE OF OPERATIONS AND SUMM_3
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of property and equipment useful life | Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, as follows: Furniture and fixtures 5 - 7 years Leasehold improvements 5 - 7 years Laboratory equipment 3 - 15 years |
Schedule of impact of adoption reflected in Consolidated financial statements | The expected impact of adoption to be reflected in the Company’s consolidated financial statements for the fiscal quarter ending September 30, 2019, is as follows (in thousands): Right-of-use assets recorded under new standard $ 605 Right-of-use liabilities recorded under new standard: Current $ 227 Long-term 406 Total 633 Eliminate deferred rent liability under current accounting standard (28) Net increase in liabilities due to adoption of new standard $ 605 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
PROPERTY AND EQUIPMENT | |
Summary of property and equipment | The following is a summary of property and equipment as of June 30, 2019 and 2018 (in thousands): 2019 2018 Furniture and fixtures $ 47 $ 118 Leasehold improvements — 29 Laboratory equipment — 739 Total property and equipment 47 886 Less accumulated depreciation and amortization (3) (518) Net property and equipment $ 44 $ 368 |
CONVERTIBLE NOTES PAYABLE (Tabl
CONVERTIBLE NOTES PAYABLE (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
CONVERTIBLE NOTES PAYABLE | |
Summary of convertible notes payable | Convertible notes payable are as follows as of June 30, 2019 and 2018 (in thousands): Original Interest Rate Funding Date Stated Default 2019 2018 Fiscal 2018 Notes: Former member of board of directors January 2018 12.0 % 15.0 % (1) $ — $ 500 (2)(3) Former member of board of directors February 2018 15.0 % 15.0 % — 500 (2)(3)(4) Other investors February 2018 12.0 % 15.0 % (1) — 200 (2)(3) Other investors April 2018 12.0 % 15.0 % (1) — 4,140 (2) Less unaccreted discount and issuance costs — (1,915) (5) Net carrying value — 3,425 Note payable, due on demand (6) May 2010 8.0 % 8.0 % 10 10 Total $ 10 $ 3,435 (1) Beginning on July 1, 2018, the interest rate increased from the stated rate of 12.0% to the default rate of 15.0% due to the Company’s failure to make quarterly interest payments. (2) As amended in April 2018, all of the Fiscal 2018 Notes provided that the unpaid principal and accrued interest automatically convert to the class of securities issued in an equity financing for at least $15 million at a 20% discount to the terms set forth in such financing. This feature that enabled conversion at a 20% discount was a contingent BCF that was not calculated and recorded until the financing that triggered conversion was completed. Since the closing of the Series AA Financing resulted in the conversion of the Fiscal 2018 Notes, the contingent BCF was measured and recognized on January 30, 2019 as discussed below under the caption “Beneficial Conversion Feature”. (3) In April 2018, these notes and related warrants were amended to mirror the terms of the Fiscal 2018 Notes issued in April 2018. Accordingly, the Company completed an analysis to determine if changes to the terms of these notes should be accounted for as a troubled debt restructuring, a debt modification or as an extinguishment. Since the future cash flows of the instruments changed by an amount greater than 10%, debt extinguishment accounting was applied. Accordingly, the Company recognized a loss on the extinguishment of debt of approximately $0.6 million. (4) This convertible promissory note contained an embedded derivative for the acceleration of the maturity date if the note was paid prior to maturity, whereby a $25,000 penalty plus all unpaid interest to be accrued through the maturity date was due. The initial measurement of fair value for this embedded derivative liability was $100,000, which was reflected as DDIC. The fair value of this embedded derivative was $74,000 as of June 30, 2018, which resulted in a gain of $26,000 for the fiscal year ended June 30, 2019. This embedded derivative was eliminated upon conversion of the convertible promissory note on January 30, 2019, which resulted in the recognition of a gain of $74,000 for the fiscal year ended June 30, 2019. (5) As discussed below under the caption “Debt Discount and Issuance Costs”, the Company incurred DDIC of $3.2 million related to the issuance of the Fiscal 2018 Notes, of which the unaccreted balance was $1.9 million as of June 30, 2018. (6) This convertible note payable was executed in May 2010 whereby the principal and accrued interest are convertible to Common Stock at a price of $1.02 per share. To date, the holder has not exercised its conversion rights or requested payment. |
Summary of components of debt discount and issuance costs | The components of DDIC for the fiscal years ended June 30, 2019 and 2018, are as follows (in thousands, except per share amounts): Warrant Terms Number Exercise Fair Components of DDIC of Shares Price Value Fair value of warrants issued in fiscal 2018: Fiscal 2018 Note holders 12,185 $ 0.52 $ 1,899 Placement Agent 289 $ 0.52 217 Modification of warrant in January 2019 707 0.18 138 Initial fair value of embedded derivative in February 2018 100 Incremental and direct costs of placement in fiscal 2018 204 Total DDIC related to Fiscal 2018 Notes $ 2,558 |
Summary of aggregate principal and accrued interest of converted to Series AA Preferred Stock | Accrued Converted to Ending Date of Borrowing Principal Interest Series AA Balance January 2018 $ 500 $ 95 $ (595) $ — February 2018 700 102 (802) — April 2018 4,140 603 (4,743) — Total $ 5,340 $ 800 $ (6,140) $ — |
Summary of the components of interest expense related to Convertible Notes Payable | Convertible Notes Payable for the fiscal years ended June 30, 2019 and 2018 (in thousands): 2019 2018 Interest expense at contractual rate $ 672 $ 184 Accretion of discount 2,053 505 Beneficial conversion feature for Fiscal 2018 Notes 2,233 — Total interest expense $ 4,958 $ 689 |
STOCKHOLDER'S EQUITY (Tables)
STOCKHOLDER'S EQUITY (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
STOCKHOLDERS' EQUITY (DEFICIT) | |
Summary Of The Liquidation Preference and Conversion Terms | The conversion terms for all shares of Series AA Preferred Stock that converted to Common Stock on April 24, 2019, are as follows (in thousands, except share and per share amounts): Number Conversion Value Common Stock Conversion Holder of Shares Per Share Amount Price Shares New Investors 2,500,000 $ 10.00 $ 25,000 $ 0.22 113,637 Fiscal 2018 Note holders 767,519 10.00 7,675 0.22 34,887 Total 3,267,519 $ 32,675 148,524 |
STOCK-BASED COMPENSATION AND _2
STOCK-BASED COMPENSATION AND WARRANTS (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
STOCK-BASED COMPENSATION AND WARRANTS | |
Schedule of summary of combined stock option activity | The following table sets forth a summary of combined stock option activity under the 2015 Plan, the 2016 Plan and the Terminated Plans for the fiscal years ended June 30, 2019 and 2018 (shares in thousands): 2019 2018 Shares Price (1) Term (2) Shares Price (1) Term (2) Outstanding, beginning of fiscal year 19,415 $ 1.55 7.8 21,291 $ 1.65 7.7 Granted 1,125 0.52 255 1.08 Forfeited (6,675) 1.53 (1,881) 1.62 Expired — — (250) 4.50 Outstanding, end of fiscal year 13,865 1.60 6.4 19,415 1.55 7.8 Vested, end of fiscal year 9,604 1.85 5.7 11,399 1.92 6.4 (1) Represents the weighted average exercise price. (2) Represents the weighted average remaining contractual term until the stock options expire. |
Schedule of the fair value of stock options was estimated on the date of grant using the BSM option-pricing model using following weighted-average assumptions | 2019 2018 Grant date fair value of common stock $ 0.52 $ 1.08 Expected volatility 84 % 84 % Risk free interest rate 2.8 % 2.1 % Expected term (years) 7.0 7.0 Dividend yield — % — % |
Schedule of Stock-based compensation expense | Stock-based compensation expense for the fiscal years ended June 30, 2019 and 2018 is included in compensation and benefits under the following captions in the consolidated statements of operations (in thousands): 2019 2018 Research and development $ 538 $ 982 General and administrative 2,098 4,113 Total $ 2,636 $ 5,095 |
Summary of warrant activity | Presented below is a summary of warrant activity for the fiscal years ended June 30, 2019 and 2018 (shares in thousands): 2019 2018 Shares Price (1) Term (2) Shares Price (1) Term (2) Outstanding, beginning of fiscal year 45,635 $ 1.37 3.4 32,796 $ 1.71 3.7 Warrants issued for: Consulting services — — 650 (3) 1.03 Debt discount for Fiscal 2018 Notes — — 12,185 (4) 0.52 Placement agent debt discount — — 289 (5) 0.52 Modification for debt discount to former member of Board of Directors: Replacement warrant 1,207 (6) 0.18 — — Canceled warrant (500) (6) 0.52 — — Warrant expirations (345) 2.41 (285) 2.43 Outstanding, end of fiscal year 45,997 1.34 2.3 45,635 1.37 3.4 (1) Represents the weighted average exercise price. (2) Represents the weighted average remaining contractual term until the warrants expire. (3) Consists of three warrants for an aggregate of 650,000 shares granted to consultants for services that were immediately exercisable. The commitment date fair value of approximately $0.5 million is included in consulting expense for the fiscal year ended June 30, 2018. The fair value of these warrants was determined on the commitment date using the BSM option-pricing model. Key weighted average assumptions included the grant date fair value of Company’s Common Stock of $1.07 per share, expected volatility of 82%, a risk-free interest rate of 2.1%, and a remaining term of 6.5 years. (4) The aggregate commitment date fair value of the warrants issued to convertible note holders and the placement agent was approximately $3.8 million. The warrants and debt were recorded based on their relative fair value which resulted in a debt discount of $2.5 million related to the Fiscal 2018 Notes discussed in Note 5. The fair value of these warrants was determined on the commitment date using the BSM option-pricing model. Key weighted average assumptions included the grant date fair value of Company’s Common Stock of $0.45 per share, expected volatility of 96%, a risk-free interest rate of 2.8%, and an estimated term of 5.0 years. (5) Pursuant to the terms of the warrants, the exercise price was not established until June 30, 2018 so the fair value of these warrants was determined using a lattice option-pricing model. Key weighted average assumptions included the grant date fair value of Company’s Common Stock of $0.58 per share, expected volatility of 86%, a risk-free interest rate of 2.8%, a remaining term of 10 years, and a discount rate of 20%. (6) As discussed in Note 10, in January 2019 the Company agreed to modify a warrant originally issued in June 2018 for 500,000 shares that was exercisable at $0.52 per share. This warrant was originally issued in connection with one of the Fiscal 2018 Notes issued to a former member of the Board of Directors. The difference between the fair value of the modified warrant and the fair value of the canceled warrant amounted to $138,000, which was accounted for as an additional debt discount that was charged to interest expense upon repayment of the Fiscal 2018 Notes on January 30, 2019. Key assumptions for valuation of the modified warrant and the canceled warrant included the fair value of Company’s Common Stock on the modification date of $0.23 per share, expected volatility of 100%, a risk-free interest rate of 2.5%, and an estimated remaining term of 4.0 years. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
INCOME TAXES | |
Schedule of Effective Income Tax Rate Reconciliation | For the fiscal years ended June 30, 2019 and 2018, the reconciliation between the income tax benefit computed by applying the statutory U.S. federal income tax rate to the pre-tax loss before income taxes, and total income tax expense recognized in the financial statements is as follows (in thousands): 2019 2018 Income tax benefit at statutory U.S. federal rate $ 6,394 $ 8,078 Income tax benefit attributable to U.S. states 1,876 985 Non-deductible interest and other expenses (1,045) (12) Transition impact of Tax Act — (8,490) Stock option expirations (1,484) (645) Other (328) — Change in valuation allowance (5,413) 84 Total income tax expense $ — $ — |
Schedule of Deferred Tax Assets and Liabilities | As of June 30, 2019 and 2018, the income tax effects of temporary differences that give rise to significant deferred income tax assets and liabilities are as follows (in thousands): 2019 2018 Deferred income tax assets: Net operating loss carryforwards $ 20,016 $ 15,563 Stock-based compensation 3,716 4,162 Start-up and organizational expenses 338 334 Property and equipment — 515 Accesed expenses and other 1,598 467 Total deferred income tax assets 25,668 21,041 Valuation allowance for deferred income tax assets (25,656) (20,243) Net deferred income tax assets 12 798 Deferred income tax liability: Federal benefit for state deferred income taxes and other (12) (798) Net deferred income tax assets $ — $ — |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | The table below summarizes the Company’s operating lease commitments under these leases as of June 30, 2019 (in thousands): Fiscal Year Ending June 30, 2020 $ 275 2021 272 2022 170 $ 717 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Net Loss Per Share | |
Net loss per share | 2019 2018 Net loss $ (30,446) $ (29,862) Beneficial conversion feature (2,273) — Net loss attributable to common stockholders $ (32,719) $ (29,862) |
Disclosure of diluted netloss impact of inclusion anti dilutive | 2019 2018 Stock options 13,865 19,415 Warrants 45,997 45,635 Total 59,862 65,050 |
SUBSEQUENT EVENTS (Tables)
SUBSEQUENT EVENTS (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
SUBSEQUENT EVENTS | |
Schedule of unaudited pro forma balance sheet that gives effect to the Financing Activities, Restricted Funds and Early Payments | Presented below is an unaudited pro forma balance sheet that gives effect to the Financing Activities and Early Payments discussed above, as if these events had occurred on June 30, 2019: Unaudited Pro Forma Adjustments Equity Financings Offering Xoma Early Unaudited Historical New Investors Other Costs Payments Pro Forma Assets Cash, cash equivalents and restricted cash $ 11,573 $ 20,000 (1) $ 4,050 (2) $ (1,443) (3) $ (3,391) (4) $ 30,789 Prepaid expenses and other 571 — — — — 571 Non-current assets 108 — — — — 108 Total assets $ 12,252 $ 20,000 $ 4,050 $ (1,443) $ (3,391) $ 31,468 Liabilities and Stockholders' Equity Current liabilities $ 8,379 $ — $ — $ — $ (1,391) (4) $ 6,988 Non-current liabilities 2,121 — — — (2,000) (4) 121 Total liabilities 10,500 — — — (3,391) 7,109 Stockholders equity: Common Stock 210 69 (1) 14 (2) — — 293 Additional paid-in capital 128,445 19,931 (1) 4,036 (2) (1,443) (3) — 150,969 Accumulated deficit (126,903) — — — — (126,903) Total stockholders' equity 1,752 20,000 4,050 (1,443) — 24,359 Total liabilities and stockholders' equity $ 12,252 $ 20,000 $ 4,050 $ (1,443) $ (3,391) $ 31,468 Shares of Common Stock outstanding 210,390 68,966 (1) 13,965 (2) — — 293,321 (1) Gives effect to the issuance of 69.0 million shares in a private placement of Common Stock to the New Investors for gross proceeds of $20.0 million. (2) Gives effect to the issuance of approximately 14.0 million shares of Common Stock to other investors in the private placement for gross proceeds of $4.1 million. (3) Gives effect to the financial advisory fees payable at 6.0% of the gross proceeds from the issuance of shares in the private placement. (4) Gives effect to the Early Payments to Xoma based on 15% of the net proceeds from equity financings of $22.6 million. |
Schedule of options granted to executive officers and other employees | summary of the number of options granted to executive officers and other employees: Time-Based Vesting Performance Total Exercise Number of Shares Vesting Shares Price Vested Unvested Shares Granted Executive officers $ 0.29 3,588 11,562 (1) 7,550 (2) 22,700 Other employees 0.29 921 6,629 (1) 3,700 (2) 11,250 Total 4,509 18,191 11,250 33,950 (1) Stock options are subject to time-based vesting in two tranches, whereby (i) 25% of such options are immediately exercisable for employees who have been employed by the Company for more than one year, and for employees that have been employed by the Company less than one year, 25% of such options will vest on the one year anniversary of the employee’s start date; and (ii) the remaining 75% of the stock options will vest ratably over a period of 36 months after vesting of the initial 25% tranche. (2) Vesting of these stock options is subject to achievement of performance milestones whereby such options will vest ratably over a period of 36 months beginning when all of the following have occurred: (i) the Company achieves a listing for its shares of Common Stock on a national stock exchange; (ii) the Company’s closing stock price exceeds $0.58 per share for 20 trading days in any consecutive 30 day period within 4 years of the date of the option grant, and (iii) the option recipient having completed at least one year of employment with the Company. |
NATURE OF OPERATIONS AND SUMM_4
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 12 Months Ended |
Jun. 30, 2019 | |
Maximum [Member] | Furniture and fixtures [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 7 years |
Maximum [Member] | Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 7 years |
Maximum [Member] | Laboratory Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 15 years |
Minimum [Member] | Furniture and fixtures [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 5 years |
Minimum [Member] | Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 5 years |
Minimum [Member] | Laboratory Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 3 years |
NATURE OF OPERATIONS AND SUMM_5
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months | $ 7,000 | |
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 7,000 | |
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 7,000 | |
Finite-Lived Intangible Assets, Amortization Expense, Year Four | 7,000 | |
Finite-Lived Intangible Assets, Amortization Expense, Year Five | 7,000 | |
Amortization expense related to intangible assets | $ 7,000 | $ 7,000 |
Patents [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 11 years |
NATURE OF OPERATIONS AND SUMM_6
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Impact of adoption (Details) - Accounting Standards Update 2016-02 [Member] $ in Thousands | Jun. 30, 2019USD ($) |
New Accounting Pronouncement, Early Adoption [Line Items] | |
Right-of-use assets recorded under new standard | $ 605 |
Right-of-use liabilities recorded under new standard: Current | 227 |
Right-of-use liabilities recorded under new standard: Long-term | 406 |
Total | 633 |
Eliminate deferred rent liability under current accounting standard | (28) |
Net increase in liabilities due to adoption of new standard | $ 605 |
LIQUIDITY (Details)
LIQUIDITY (Details) - USD ($) $ in Thousands, shares in Millions | Jan. 31, 2019 | Aug. 31, 2019 | Jun. 30, 2019 | Jun. 30, 2018 |
Net loss | $ (30,446) | $ (29,862) | ||
Net cash used in operating activities | (15,304) | (14,113) | ||
Accumulated deficit | (126,903) | (94,184) | ||
Cash and cash equivalents | 11,573 | 1,646 | ||
Liabilities | 10,500 | $ 6,464 | ||
Cash proceeds from equity offering | $ 25,000 | $ 22,600 | ||
Aggregate principal balance | 5,300 | |||
Accrued interest | $ 800 | |||
Licensing obligations | 8,500 | |||
Research and development spending and other clinical programs | 11,000 | |||
Spending on compensation, benefits, rent, other research costs, and public company costs for auditing and professional fees | $ 10,400 | |||
Subsequent Event [Member] | ||||
Net proceeds from private placement | $ 22,600 | |||
Number of shares issued | 82.9 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 47 | $ 886 |
Less: accumulated depreciation and amortization | (3) | (518) |
Property, Plant and Equipment, Net | 44 | 368 |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 47 | 118 |
Furniture and fixtures [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Furniture and fixtures [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 29 | |
Leasehold Improvements [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Leasehold Improvements [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Laboratory equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 739 |
PROPERTY AND EQUIPMENT - Additi
PROPERTY AND EQUIPMENT - Additional Information (Details) | Dec. 14, 2018USD ($) | Jun. 30, 2019USD ($)employee | Jun. 30, 2018USD ($) | Apr. 30, 2018USD ($) |
PROPERTY AND EQUIPMENT | ||||
Depreciation | $ 41,000 | $ 1,100,000 | ||
Leasehold improvements | $ 1,700,000 | |||
Impairment charge | 1,700,000 | |||
Employees that resulted in severance | employee | 30 | |||
Severance payments | $ 600,000 | |||
Proceeds from Sale of Property, Plant, and Equipment | 278,000 | 1,550,000 | ||
Gain (Loss) on Disposition of Property Plant Equipment | (12,000) | (663,000) | ||
Proceeds from sales of furniture, fixtures, and laboratory equipment | 300,000 | |||
Impairment of Long-Lived Assets to be Disposed of | 33,000 | $ 1,691,000 | ||
Gain from termination of the leases and subleases | $ 168,000 | $ 200,000 |
LICENSE AGREEMENTS (Details)
LICENSE AGREEMENTS (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jan. 31, 2019 | Jan. 30, 2019 | Jan. 07, 2019 | Mar. 30, 2018 | Mar. 01, 2018 | Sep. 30, 2020 | Jun. 30, 2020 | Apr. 30, 2018 | Dec. 31, 2017 | Aug. 31, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 |
License Agreements | |||||||||||||||||
Stock Issued During Period, Value, Other | $ 5,000,000 | ||||||||||||||||
Stock Issued During Period, Shares, Other | 7,000,000 | 345,000 | |||||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 8,500,000 | $ 7,000,000 | $ 12,000 | $ 550,000 | |||||||||||||
Payment of license | $ 8,500,000 | ||||||||||||||||
Liabilities | 10,500,000 | 6,464,000 | |||||||||||||||
Liabilities, Current | 8,379,000 | 6,248,000 | |||||||||||||||
Delay fee | 50,000 | ||||||||||||||||
Payment for Accrued Liabilities | 400,000 | ||||||||||||||||
License Fees | 5,500,000 | ||||||||||||||||
Early payments obligation | 3,400,000 | ||||||||||||||||
Contractual Obligation | 8,500,000 | ||||||||||||||||
Qualified Financing Future Cash Payments Due | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 | $ 1,000,000 | $ 1,500,000 | ||||||||||
License Fees Payable Current | 6,500,000 | 0 | |||||||||||||||
License Fees Payable Noncurrent | $ 2,000,000 | $ 0 | |||||||||||||||
Shares of Common Stock outstanding | 210,390 | 62,166 | |||||||||||||||
Proceeds from Issuance or Sale of Equity | $ 25,000,000 | $ 22,600,000 | |||||||||||||||
Scenario, Forecast [Member] | |||||||||||||||||
License Agreements | |||||||||||||||||
Early payments made | $ 2,000,000 | $ 1,400,000 | |||||||||||||||
Series AA Preferred Stock | |||||||||||||||||
License Agreements | |||||||||||||||||
Proceeds from Issuance of Preferred Stock and Preference Stock | $ 25,000,000 | $ 5,900,000 | $ 25,000,000 | ||||||||||||||
Xoma | |||||||||||||||||
License Agreements | |||||||||||||||||
Stock Issued During Period, Shares, Other | 8,100,000 | ||||||||||||||||
Shares of Common Stock outstanding | 8,100,000 | ||||||||||||||||
Xoma | Put Option [Member] | |||||||||||||||||
License Agreements | |||||||||||||||||
Description Of Option Indexed To Issuers Equity Shares | Xoma may exercise the Put option for up to a total of 2.5 million shares of Common Stock for the fiscal year ending December 31, 2020, and up to an additional 2.5 million shares thereafter. | ||||||||||||||||
2019 Closing Of Purchase Agreement [Member] | |||||||||||||||||
License Agreements | |||||||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 8,500,000 | $ 7,000,000 | |||||||||||||||
License agreement | |||||||||||||||||
License Agreements | |||||||||||||||||
Early payments obligation | $ 3,400,000 | ||||||||||||||||
Qualified Financing Future Cash Payments | $ 8,500,000 | ||||||||||||||||
License agreement | Scenario, Forecast [Member] | |||||||||||||||||
License Agreements | |||||||||||||||||
Early payments made | $ 2,000,000 | $ 1,400,000 | |||||||||||||||
License | |||||||||||||||||
License Agreements | |||||||||||||||||
Proceeds from License Fees Received | $ 5,500,000 |
LICENSE AGREEMENTS - Additional
LICENSE AGREEMENTS - Additional Information (Details) - ActiveSite Pharmaceuticals, Inc. [Member] - USD ($) | Aug. 04, 2017 | Jun. 30, 2019 | Jun. 30, 2018 |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||
Upfront Payment, Payable | $ 750,000 | ||
Maximum Amount of Milestone Events | $ 36,000,000 | ||
First milestone payment due after completion of the preclinical work | $ 1,000,000 | ||
Royalties percentage | 2.00% | ||
Minimum [Member] | |||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||
Milestone Payments | $ 1,000,000 | ||
Maximum [Member] | |||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||
Milestone Payments | $ 10,000,000 | ||
Total royalty payments | $ 10,000,000 |
CONVERTIBLE NOTES PAYABLE (Deta
CONVERTIBLE NOTES PAYABLE (Details) - USD ($) | Apr. 30, 2018 | Apr. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jan. 30, 2019 | May 10, 2010 |
Debt Instrument [Line Items] | ||||||
Less unaccreted discount and issuance costs | $ (1,915,000) | |||||
Net carrying value | $ 0 | 3,425,000 | ||||
Total | 10,000 | 3,435,000 | ||||
Unpaid principal and accrued interest automatically convert to class of securities issued in an equity financing | 5,340,000 | 0 | ||||
Discount on conversion (as a percent) | 20.00% | |||||
Increase in percentage of future cash flows of the instruments | 10.00% | |||||
Loss on extinguishment of debt | 0 | (602,000) | ||||
Prepayment penalty | 25,000 | |||||
Initial measurement of fair value for embedded derivative liability | 100,000 | |||||
Fair value of embedded derivative | 0 | 74,000 | ||||
Gain on remeasurement of fair value of embedded derivative | 26,000 | |||||
Gain on elimination of embedded derivative upon conversion of convertible promissory note | 74,000 | |||||
Debt discount and issuance costs incurred | $ 2,558,000 | 3,200,000 | ||||
Conversion price | $ 0.176 | $ 8 | $ 1.02 | |||
Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Unpaid principal and accrued interest automatically convert to class of securities issued in an equity financing | $ 15,000,000 | |||||
Former member of board of directors funding on January 2018 | ||||||
Debt Instrument [Line Items] | ||||||
Convertible notes payable | $ 500,000 | |||||
Interest Rate (Stated) | 12.00% | |||||
Interest Rate (Default) | 15.00% | |||||
Former member of board of directors funding on February 2018 | ||||||
Debt Instrument [Line Items] | ||||||
Convertible notes payable | $ 500,000 | |||||
Interest Rate (Stated) | 15.00% | |||||
Interest Rate (Default) | 15.00% | |||||
Other investors funding on February 2018 | ||||||
Debt Instrument [Line Items] | ||||||
Convertible notes payable | $ 200,000 | |||||
Interest Rate (Stated) | 12.00% | |||||
Interest Rate (Default) | 15.00% | |||||
Other investors funding on April 2018 | ||||||
Debt Instrument [Line Items] | ||||||
Convertible notes payable | $ 4,140,000 | |||||
Interest Rate (Stated) | 12.00% | |||||
Interest Rate (Default) | 15.00% | |||||
Note payable due on demand on May 2010 | ||||||
Debt Instrument [Line Items] | ||||||
Note payable, due on demand | $ 10,000 | $ 10,000 | ||||
Interest Rate (Stated) | 8.00% | |||||
Interest Rate (Default) | 8.00% |
CONVERTIBLE NOTES PAYABLE - Com
CONVERTIBLE NOTES PAYABLE - Component of debt discount and issuance costs (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Class of Warrant or Right [Line Items] | |||
Fair value of warrants issued in fiscal 2018: Number of shares | 45,997 | 45,635 | 32,796 |
Fair value of warrants issued in fiscal 2018: Exercise price | $ 1.34 | $ 1.37 | $ 1.71 |
Modification of warrant in January 2019: Number of shares | 707 | ||
Modification of warrant in January 2019: Exercise price | $ 0.18 | ||
Modification of warrant in January 2019: Fair value | $ 138 | ||
Initial fair value of embedded derivative in February 2018 | 100 | ||
Incremental and direct costs of placement in fiscal 2018 | 204 | ||
Total DDIC related to Fiscal 2018 Notes | $ 2,558 | $ 3,200 | |
Fiscal 2018 Note holders | |||
Class of Warrant or Right [Line Items] | |||
Fair value of warrants issued in fiscal 2018: Number of shares | 12,185 | ||
Fair value of warrants issued in fiscal 2018: Exercise price | $ 0.52 | ||
Fair value of warrants issued in fiscal 2018: Fair value | $ 1,899 | ||
Placement Agent | |||
Class of Warrant or Right [Line Items] | |||
Fair value of warrants issued in fiscal 2018: Number of shares | 289 | ||
Fair value of warrants issued in fiscal 2018: Exercise price | $ 0.52 | ||
Fair value of warrants issued in fiscal 2018: Fair value | $ 217 |
CONVERTIBLE NOTES PAYABLE - Add
CONVERTIBLE NOTES PAYABLE - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jan. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | May 10, 2010 | |
Convertible Notes Payable [Line Items] | ||||
Debt Instrument, Convertible, Conversion Price | $ 8 | $ 0.176 | $ 1.02 | |
Increase Decrease In Accreted Debt Discount | $ 2,100 | $ 500 | ||
Debt Instrument Convertible Conversion Price After Discount | 0.22% | |||
Debt Instrument, Periodic Payment, Principal | $ 5,340 | |||
Proceeds from Convertible Debt | $ 6,100 | $ 0 | $ 5,340 | |
Convertible Debt [Member] | ||||
Convertible Notes Payable [Line Items] | ||||
Debt Instrument, Periodic Payment, Principal | 5,300 | |||
Accrued Interest Amount On Debt Instrument Convertible To Preferred Stock | $ 800 | |||
Interest On Preferred Stock Accrued Shares | 767,519 | |||
Convertible Debt [Member] | Series A Preferred Stock [Member] | ||||
Convertible Notes Payable [Line Items] | ||||
Discount Rate On Per Share Price | 20.00% | 20.00% | ||
Senior Secured Promissory Notes [Member] | ||||
Convertible Notes Payable [Line Items] | ||||
Weighted Average Price Of Common stock | 0.24% |
CONVERTIBLE NOTES PAYABLE - Agg
CONVERTIBLE NOTES PAYABLE - Aggregate principal and accrued interest (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Principal | $ 5,340 | |
Accrued interest | 800 | |
Converted to Series AA | (6,140) | |
Ending Balance | 0 | $ 3,425 |
Convertible Notes Due January 2018 | ||
Principal | 500 | |
Accrued interest | 95 | |
Converted to Series AA | (595) | |
Ending Balance | 0 | |
Convertible Notes Due February 2018 | ||
Principal | 700 | |
Accrued interest | 102 | |
Converted to Series AA | (802) | |
Ending Balance | 0 | |
Convertible Notes Due April 2018 | ||
Principal | 4,140 | |
Accrued interest | 603 | |
Converted to Series AA | (4,743) | |
Ending Balance | $ 0 |
CONVERTIBLE NOTES PAYABLE - A_2
CONVERTIBLE NOTES PAYABLE - Aggregate principal and accrued interest of converted to Series AA Preferred Stock (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Components of interest expense | ||
Interest expense at contractual rate | $ 672 | $ 184 |
Accretion of discount | 2,053 | 505 |
Beneficial conversion feature attributable to Fiscal 2018 Notes | 2,233 | 0 |
Total interest expense | $ 4,958 | $ 689 |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) (Details) - Series AA Preferred Stock - USD ($) $ / shares in Units, $ in Thousands | Jun. 30, 2019 | Apr. 24, 2019 |
Class of Stock [Line Items] | ||
Number of Shares | 3,267,519 | |
Total Issue Price | $ 32,675 | |
Shares of Common Stock | 34,900,000 | |
Series A Preferred Stock Shares Converted | 148,524 | |
Other Investors [Member] | ||
Class of Stock [Line Items] | ||
Number of Shares | 2,500,000 | |
Total Issue Price | $ 25,000 | |
Conversion Price | $ 0.22 | |
Shares of Common Stock | 10 | |
Series A Preferred Stock Shares Converted | 113,637 | |
Fiscal 2018 Notes holders | ||
Class of Stock [Line Items] | ||
Number of Shares | 767,519 | |
Total Issue Price | $ 7,675 | |
Conversion Price | $ 0.22 | |
Shares of Common Stock | 10 | |
Series A Preferred Stock Shares Converted | 34,887 |
STOCKHOLDERS' EQUITY (DEFICIT_2
STOCKHOLDERS' EQUITY (DEFICIT) - Addtional Information (Details) - USD ($) | Apr. 24, 2019 | Jan. 30, 2019 | Jan. 07, 2019 | Apr. 03, 2018 | Apr. 03, 2018 | Mar. 30, 2018 | Jul. 23, 2019 | Jan. 30, 2019 | Dec. 31, 2017 | Aug. 31, 2019 | Sep. 30, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | Jul. 31, 2019 | Apr. 30, 2019 | Apr. 23, 2019 | Mar. 31, 2019 | Jan. 31, 2019 | Jan. 18, 2019 | Dec. 22, 2017 | Jun. 30, 2017 | May 10, 2010 |
Class of Stock [Line Items] | ||||||||||||||||||||||
Authorized number of shares of Common Stock | 500,000 | 500,000 | ||||||||||||||||||||
Preferred Stock, Shares Authorized | 20,000 | 20,000 | ||||||||||||||||||||
Exclusivity Payments | $ 1,500,000 | $ 0 | ||||||||||||||||||||
Shares Issued, Price Per Share | $ 8 | |||||||||||||||||||||
Conversion price | $ 8 | $ 8 | $ 0.176 | $ 1.02 | ||||||||||||||||||
Purchase of Common Stock | 65,000 | 10,000,000 | ||||||||||||||||||||
Share Price | $ 0.29 | |||||||||||||||||||||
Volume weighted average closing price of common stock | 75.00% | |||||||||||||||||||||
Proceeds from Issuance of Common Stock | $ 0 | $ 4,500,000 | ||||||||||||||||||||
Proceeds from convertible notes payable | $ 6,100,000 | $ 0 | $ 5,340,000 | |||||||||||||||||||
Debt instrument discount percentage | 20.00% | 20.00% | ||||||||||||||||||||
Notes Payable | $ 767,519 | |||||||||||||||||||||
Payments of stock issuance costs | $ 0 | $ 60,000 | ||||||||||||||||||||
Estimated Fair Value Of Common Stock | $ 300,000 | |||||||||||||||||||||
Sale of Stock, Price Per Share | $ 0.40 | $ 0.58 | ||||||||||||||||||||
Purchase of Common Stock | 65,000 | 10,000,000 | ||||||||||||||||||||
Stock Issued During Period, Shares, Other | 7,000,000 | 345,000 | ||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.34 | $ 1.37 | $ 1.71 | |||||||||||||||||||
Adjustments to Additional Paid in Capital, Warrant Issued | $ 2,718,000 | |||||||||||||||||||||
Common Stock, Par or Stated Value Per Share | 0.001 | $ 0.001 | ||||||||||||||||||||
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | ||||||||||||||||||||
Stock Issued During Period, Shares, Issued for Services | 8,100,000 | |||||||||||||||||||||
Stock Issued During Period Value Common stock issued pursuant to license agreement | $ 4,600,000 | |||||||||||||||||||||
Subsequent Event [Member] | ||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||
Stock Issued During Period, Shares, New Issues | 82,900,000 | |||||||||||||||||||||
Sale of Stock, Price Per Share | $ 0.21 | |||||||||||||||||||||
Maximum [Member] | ||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||
Authorized number of shares of Common Stock | 200,000,000 | 200,000,000 | 200,000,000 | |||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0.52 | |||||||||||||||||||||
Minimum [Member] | ||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||
Authorized number of shares of Common Stock | 500,000,000 | |||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0.18 | |||||||||||||||||||||
Lincoln Park Transaction [Member] | ||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||
Related Party Transaction, Value of Common Stock to be Issued | $ 10,000,000 | $ 500,000,000 | ||||||||||||||||||||
Maximum Number of Shares to be Issued Under Certain Conditions | 500,000 | |||||||||||||||||||||
Series A Preferred Stock [Member] | ||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||
Recission of the previous designation of shares | 15,000,000 | |||||||||||||||||||||
Series AA Preferred Stock | ||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||
Authorized number of shares of Common Stock | 500,000,000 | |||||||||||||||||||||
Preferred Stock, Shares Authorized | 5,000,000 | |||||||||||||||||||||
Proceeds from Issuance of Preferred Stock and Preference Stock | $ 25,000,000 | $ 5,900,000 | $ 25,000,000 | |||||||||||||||||||
Stock Issued During Period, Shares, New Issues | 2,500,000 | 2,500,000 | 113,600,000 | |||||||||||||||||||
Shares Issued, Price Per Share | $ 10 | $ 10 | $ 0.24 | |||||||||||||||||||
Conversion price | $ 0.22 | |||||||||||||||||||||
Convertible Preferred Stock, Shares Issued upon Conversion | 34,900,000 | |||||||||||||||||||||
Purchase of Common Stock | 10,000,000 | |||||||||||||||||||||
Share Price | $ 0.29 | |||||||||||||||||||||
Volume weighted average closing price of common stock | 75.00% | |||||||||||||||||||||
Proceeds from Issuance of Common Stock | $ 20,000,000 | |||||||||||||||||||||
Beneficial conversion feature for Fiscal 2018 Notes | $ 2,300,000 | |||||||||||||||||||||
Conversion of Stock, Shares Converted | 767,519 | |||||||||||||||||||||
Purchase of Common Stock | 10,000,000 | |||||||||||||||||||||
Series AA Preferred Stock | Subsequent Event [Member] | ||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||
Stock Issued During Period, Shares, New Issues | 69,000,000 | |||||||||||||||||||||
Common Stock | ||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||
Authorized number of shares of Common Stock | 500,000,000 | 200,000,000 | ||||||||||||||||||||
Convertible Preferred Stock, Shares Issued upon Conversion | 113,600,000 | |||||||||||||||||||||
Equity Method Investment, Ownership Percentage | 54.00% | |||||||||||||||||||||
Private Placement | ||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||
Stock Issued During Period, Shares, New Issues | 4,500,000 | 13,100,000 | ||||||||||||||||||||
Share Price | $ 1 | |||||||||||||||||||||
Proceeds from Issuance of Common Stock | $ 3,800,000 | |||||||||||||||||||||
Gross proceeds from issuance | $ 4,500,000 | |||||||||||||||||||||
Payments of stock issuance costs | 60,000 | |||||||||||||||||||||
Proceeds from Issuance of Private Placement | $ 4,500,000 | |||||||||||||||||||||
Private Placement | Series AA Preferred Stock | ||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||
Proceeds from Issuance of Preferred Stock and Preference Stock | $ 25,000,000 |
STOCK-BASED COMPENSATION AND _3
STOCK-BASED COMPENSATION AND WARRANTS (Details) - $ / shares | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Number of Options | |||
Outstanding | 19,415 | 21,291 | |
Granted | 1,125 | 255 | |
Forfeited | (6,675) | (1,881) | |
Expired | (250) | ||
Outstanding | 13,865 | 19,415 | 21,291 |
Vested | 9,604 | 11,399 | |
Weighted Average Exercise Price | |||
Outstanding | $ 1.55 | $ 1.65 | |
Granted | 0.52 | 1.08 | |
Forfeited | 1.53 | 1.62 | |
Expired | 4.50 | ||
Outstanding | 1.60 | 1.55 | $ 1.65 |
Vested | $ 1.85 | $ 1.92 | |
Weighted Average Remaining Contractual Life | |||
Outstanding | 6 years 4 months 24 days | 7 years 9 months 18 days | 7 years 8 months 12 days |
Vested | 5 years 8 months 12 days | 6 years 4 months 24 days |
STOCK-BASED COMPENSATION AND _4
STOCK-BASED COMPENSATION AND WARRANTS - Weighted average assumptions (Details) - Employee Stock Option [Member] - $ / shares | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Grant date fair value of common stock | $ 0.52 | $ 1.08 |
Expected volatility | 84.00% | 84.00% |
Risk free interest rate | 2.80% | 2.10% |
Expected term (years) | 7 years | 7 years |
Dividend yield | 0.00% | 0.00% |
STOCK-BASED COMPENSATION AND _5
STOCK-BASED COMPENSATION AND WARRANTS - Stock based compensation expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | $ 2,636 | $ 5,095 |
Research and Development Expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | 538 | 982 |
General and Administrative Expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | $ 2,098 | $ 4,113 |
STOCK-BASED COMPENSATION AND _6
STOCK-BASED COMPENSATION AND WARRANTS - Warrants (Details) - $ / shares | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
STOCK-BASED COMPENSATION AND WARRANTS | ||
Number of warrants exercised | 0 | 0 |
Outstanding, beginning of fiscal year, Shares | 45,635 | 32,796 |
Outstanding, beginning of fiscal year, Price | $ 1.37 | $ 1.71 |
Outstanding, beginning of fiscal year, Term | 3 years 4 months 24 days | 3 years 8 months 12 days |
Warrants issued for: Consulting services, Shares | 0 | 650 |
Warrants issued for: Consulting services, Price | $ 0 | $ 1.03 |
Warrants issued for: Debt discount for Fiscal 2018 Notes, Shares | 0 | 12,185 |
Warrants issued for: Debt discount for Fiscal 2018 Notes, Price | $ 0 | $ 0.52 |
Warrants issued for: Placement agent debt discount, Shares | 0 | 289 |
Warrants issued for: Placement agent debt discount, Price | $ 0 | $ 0.52 |
Modification for debt discount to former member of Board of Directors: Replacement warrant, Shares | 1,207 | 0 |
Modification for debt discount to former member of Board of Directors: Replacement warrant, Price | $ 0.18 | $ 0 |
Modification for debt discount to former member of Board of Directors: Canceled warrant, Shares | (500) | 0 |
Modification for debt discount to former member of Board of Directors: Canceled warrant, Price | $ 0.52 | $ 0 |
Warrant expirations, Shares | (345) | (285) |
Warrant expirations, Price | $ 2.41 | $ 2.43 |
Outstanding, end of fiscal year, Shares | 45,997 | 45,635 |
Outstanding, end of fiscal year, Price | $ 1.34 | $ 1.37 |
Outstanding, end of fiscal year, Term | 2 years 3 months 18 days | 3 years 4 months 24 days |
STOCK-BASED COMPENSATION AND _7
STOCK-BASED COMPENSATION AND WARRANTS - Additional information (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Jul. 31, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Apr. 24, 2019 | Apr. 23, 2019 | Jun. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock subject to currently outstanding stock options | 13,865 | 19,415 | 21,291 | |||
Shares granted | 1,125 | 255 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 1,125 | 255 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ 445,000 | $ 207,000 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 0.40 | $ 0.81 | ||||
Employee service share-based compensation, nonvested awards, total compensation cost not yet recognized, stock options | $ 2,700,000 | |||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 9 months 18 days | |||||
Class of Warrant or Right, Outstanding, Consulting Services | 0 | 650 | ||||
Modification for Debt Discount to Former Member of Board of Directors: Cancelled Warrant, Shares | (500) | 0 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.34 | $ 1.37 | $ 1.71 | |||
Class of Warrant or Right, Fair Value Difference, Modified Warrant and Cancelled Warrant | $ 138,000 | |||||
2014 Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock options outstanding terminated | 2,190,000 | |||||
2015 Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock are authorized for awards that may be granted | 6,850,000 | |||||
Common stock remain available for future grants | 4,155,000 | |||||
Common stock subject to currently outstanding stock options | 2,695,000 | |||||
2016 Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock are authorized for awards that may be granted | 28,000,000 | 15,000,000 | ||||
Common stock remain available for future grants | 19,020,000 | |||||
Common stock subject to currently outstanding stock options | 8,980,000 | |||||
Employee Stock Option [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares granted | 34,000,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 34,000,000 | |||||
Expected volatility | 84.00% | 84.00% | ||||
Risk free interest rate | 2.80% | 2.10% | ||||
Warrant term (years) | 7 years | 7 years | ||||
Warrant | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Class of Warrant or Rights, Weighted Average Grant Date Fair Value | $ 0.23 | $ 0.58 | ||||
Expected volatility | 100.00% | 86.00% | ||||
Risk free interest rate | 2.50% | 2.80% | ||||
Warrant term (years) | 4 years | 10 years | ||||
Discount rate | 20.00% | |||||
Warrants, Consulting Services [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Class of Warrant or Rights, Fair Value of Warrants | $ 500,000 | |||||
Class of Warrant or Rights, Weighted Average Grant Date Fair Value | $ 1.07 | |||||
Expected volatility | 82.00% | |||||
Risk free interest rate | 2.10% | |||||
Warrant term (years) | 6 years 6 months | |||||
Warrants, Debt Discount [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Class of Warrant or Rights, Fair Value of Warrants | $ 3,800,000 | |||||
Class of Warrant or Rights, Weighted Average Grant Date Fair Value | $ 0.45 | |||||
Expected volatility | 96.00% | |||||
Risk free interest rate | 2.80% | |||||
Warrant term (years) | 5 years |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||
Income tax benefit at statutory U.S. federal rate | $ 6,394 | $ 8,078 |
Income tax benefit attributable to U.S. states | 1,876 | 985 |
Non-deductible interest and other expense | (1,045) | (12) |
Transition impact of Tax Act | 0 | (8,490) |
Stock option expirations | (1,484) | (645) |
Other | (328) | 0 |
Change in valuation allowance | (5,413) | 84 |
Total income tax expense | $ 0 | $ 0 |
INCOME TAXES - Deferred Income
INCOME TAXES - Deferred Income Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 |
Deferred income tax assets: | ||
Net operating loss carryforward | $ 20,016 | $ 15,563 |
Stock-based compensation | 3,716 | 4,162 |
Start-up and organizational expenses | 338 | 334 |
Property and equipment | 0 | 515 |
Accesed expenses and other | 1,598 | 467 |
Total deferred income tax assets | 25,668 | 21,041 |
Valuation allowance for deferred income tax assets | (25,656) | (20,243) |
Net deferred income tax assets | 12 | 798 |
Deferred tax liabilities | ||
Federal benefit for state deferred income taxes | (12) | (798) |
Net deferred income tax assets | $ 0 | $ 0 |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2017 | Jun. 30, 2019 | Jun. 30, 2018 |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 35.00% | 21.00% | ||
Tax Cuts And Jobs Act Of 2017 Incomplete Accounting Change In Tax Rate Deferred Tax Asset Existing Income Tax Expense | $ 8,500 | |||
Increase in valuation allowance | $ 5,400 | |||
NOL carryforwards | 20,016 | $ 15,563 | ||
UNITED STATES | ||||
NOL carryforwards | 81,000 | |||
NOL carryforwards does not expire | 41,000 | |||
NOL carryforwards begin to expire in 2030 | 40,000 | |||
COLORADO | ||||
NOL carryforwards begin to expire in 2030 | $ 68,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands | Jun. 30, 2019USD ($) |
COMMITMENTS AND CONTINGENCIES | |
2020 | $ 275 |
2021 | 272 |
2022 | 170 |
Total | $ 717 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Additional Information (Details) | Dec. 14, 2018USD ($) | Jun. 30, 2019USD ($) | Aug. 31, 2019USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 25, 2019USD ($) | Feb. 07, 2019USD ($)ft² | Jan. 25, 2019USD ($)ft² |
Commitments And Contingencies [Line Items] | |||||||||
Offering costs | $ 0 | $ 60,000 | |||||||
Employer matching contributions (as a percent) | 4.00% | ||||||||
Total contributions by the entity | $ 110,000 | $ 189,000 | |||||||
Area of Land | ft² | 1,500 | 3,500 | |||||||
Security Deposit | $ 3,700 | $ 31,000 | |||||||
Gain (Loss) on Termination of Lease | $ 168,000 | 200,000 | |||||||
Deferred Rent Obligations | 200,000 | $ 21,000 | $ 2,700 | ||||||
Private Placement | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Offering costs | $ 60,000 | ||||||||
Financial advisory agreement | Private Placement | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Payment of fees under the agreement (as a percent) | 6.00% | ||||||||
Financial advisory agreement | Investor [Member] | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Payment of fees under the agreement (as a percent) | 6.00% | ||||||||
Employment Agreements | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Aggregate annual base salaries | $ 840,000 | ||||||||
Annual target bonuses (as a percent) | 150.00% | ||||||||
May 2014 Lease [Member] | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Gain (Loss) on Termination of Lease | $ 168,000 | ||||||||
Deferred Rent Obligations Gross | 225,000 | ||||||||
Security Deposit Liability | 25,000 | ||||||||
Lease Deposit Liability | $ 57,000 | ||||||||
Subsequent Event [Member] | Financial advisory agreement | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Offering costs | $ 1,400,000 | ||||||||
Minimum [Member] | Financial advisory agreement | Private Placement | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Payment of fees under the agreement from gross proceeds received | $ 20,000,000 | ||||||||
Maximum [Member] | Financial advisory agreement | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Reimbursement of Legal Fees | 60,000 | ||||||||
Maximum [Member] | Financial advisory agreement | Private Placement | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Payment of fees under the agreement from gross proceeds received | 30,000,000 | ||||||||
Maximum [Member] | Financial advisory agreement | Investor [Member] | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Payment of fees under the agreement from gross proceeds received | $ 20,000,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ / shares in Units, shares in Millions | Jan. 31, 2019 | Apr. 03, 2018 | Jul. 23, 2019 | Jan. 31, 2019 | Jan. 30, 2019 | Feb. 26, 2018 | Aug. 31, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 |
Related Party Transaction [Line Items] | ||||||||||
Proceeds from Convertible Debt | $ 6,100,000 | $ 0 | $ 5,340,000 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.34 | $ 1.37 | $ 1.71 | |||||||
Fair value of warrants issued for services | $ 138,000 | $ 12,000 | $ 550,000 | |||||||
Price per share | $ 0.29 | |||||||||
Gross proceeds from issuance | $ 25,000,000 | $ 22,600,000 | ||||||||
Director [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Proceeds from Convertible Debt | $ 500,000 | $ 500,000 | ||||||||
Maximum [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0.52 | $ 0.52 | ||||||||
Maximum [Member] | Warrant | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 1.2 | 1.2 | ||||||||
Minimum [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0.18 | $ 0.18 | ||||||||
Minimum [Member] | Warrant | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 0.5 | 0.5 | ||||||||
Subsequent Event [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of shares issued | 82.9 | |||||||||
Investor [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of shares issued | 20 | |||||||||
Price per share | $ 0.29 | |||||||||
Gross proceeds from issuance | $ 20,000,000 | |||||||||
Ownership interest by related party | 64.00% | |||||||||
Investor relation expenses | 33,000 | |||||||||
General and administrative expenses | $ 68,000 | |||||||||
Investor [Member] | Subsequent Event [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of shares issued | 69 | |||||||||
Price per share | $ 0.29 |
NET LOSS PER SHARE (Details)
NET LOSS PER SHARE (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Net Loss Per Share | ||
Net loss | $ (30,446) | $ (29,862) |
Beneficial conversion feature | (2,273) | 0 |
Net loss attributable to common stock | $ (32,719) | $ (29,862) |
NET LOSS PER SHARE - Anti Dilut
NET LOSS PER SHARE - Anti Dilutive (Details) - shares shares in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 59,862 | 65,050 |
Warrant | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 45,997 | 45,635 |
Employee Stock Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 13,865 | 19,415 |
FINANCIAL INSTRUMENTS AND SIGNF
FINANCIAL INSTRUMENTS AND SIGNFICANT CONCENTRATIONS (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
FINANCIAL INSTRUMENTS AND SIGNFICANT CONCENTRATIONS | ||
Convertible notes, remaining term to maturity | 8 months 12 days | |
Convertible notes, discount rate | 15.00% | |
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount | $ 0 | $ 0 |
Fair Value, Assets, Level 2 to Level 1 Transfers, Amount | 0 | 0 |
Fair Value, Liabilities, Level 1 to Level 2 Transfers, Amount | 0 | 0 |
Fair Value, Liabilities, Level 2 to Level 1 Transfers, Amount | 0 | 0 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3 | 0 | 0 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3 | 0 | 0 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Liability, Transfers Into Level 3 | 0 | 0 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Liability, Transfers out of Level 3 | 0 | 0 |
Cash and Cash Equivalents, at Carrying Value | $ 11,573,000 | $ 1,646,000 |
SUBSEQUENT EVENTS - Unaudited P
SUBSEQUENT EVENTS - Unaudited Pro Forma (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 |
Assets [Abstract] | |||
Cash, cash equivalents and restricted cash | $ 11,573 | ||
Prepaid expenses and other | 571 | $ 362 | |
Non-current assets | 108 | ||
Total assets | 12,252 | 2,503 | |
Liabilities | |||
Current liabilities | 8,379 | 6,248 | |
Non-current liabilities | 2,121 | ||
Total liabilities | 10,500 | 6,464 | |
Stockholders equity: | |||
Common Stock | 210 | 62 | |
Additional paid-in capital | 128,445 | 90,161 | |
Accumulated deficit | (126,903) | (94,184) | |
Total stockholders' equity | 1,752 | (3,961) | $ 8,528 |
Total liabilities and stockholders' equity | $ 12,252 | $ 2,503 | |
Shares of Common Stock outstanding | 210,390 | 62,166 | |
Equity Financings New Investors [Member] | |||
Assets [Abstract] | |||
Cash, cash equivalents and restricted cash | $ 20,000 | ||
Prepaid expenses and other | 0 | ||
Non-current assets | 0 | ||
Total assets | 20,000 | ||
Liabilities | |||
Current liabilities | 0 | ||
Non-current liabilities | 0 | ||
Total liabilities | 0 | ||
Stockholders equity: | |||
Common Stock | 69 | ||
Additional paid-in capital | 19,931 | ||
Accumulated deficit | 0 | ||
Total stockholders' equity | 20,000 | ||
Total liabilities and stockholders' equity | $ 20,000 | ||
Shares of Common Stock outstanding | 68,966 | ||
Equity Financings Other Investors [Member] | |||
Assets [Abstract] | |||
Cash, cash equivalents and restricted cash | $ 4,050 | ||
Prepaid expenses and other | 0 | ||
Non-current assets | 0 | ||
Total assets | 4,050 | ||
Liabilities | |||
Current liabilities | 0 | ||
Non-current liabilities | 0 | ||
Total liabilities | 0 | ||
Stockholders equity: | |||
Common Stock | 14 | ||
Additional paid-in capital | 4,036 | ||
Accumulated deficit | 0 | ||
Total stockholders' equity | 4,050 | ||
Total liabilities and stockholders' equity | $ 4,050 | ||
Shares of Common Stock outstanding | 13,965 | ||
Offering Costs [Member] | |||
Assets [Abstract] | |||
Cash, cash equivalents and restricted cash | $ 1,443 | ||
Prepaid expenses and other | 0 | ||
Non-current assets | 0 | ||
Total assets | 1,443 | ||
Liabilities | |||
Current liabilities | 0 | ||
Non-current liabilities | 0 | ||
Total liabilities | 0 | ||
Stockholders equity: | |||
Common Stock | 0 | ||
Additional paid-in capital | 1,443 | ||
Accumulated deficit | 0 | ||
Total stockholders' equity | 1,443 | ||
Total liabilities and stockholders' equity | $ 1,443 | ||
Shares of Common Stock outstanding | 0 | ||
Xoma Early Payments [Member] | |||
Assets [Abstract] | |||
Cash, cash equivalents and restricted cash | $ 3,391 | ||
Prepaid expenses and other | 0 | ||
Non-current assets | 0 | ||
Total assets | 3,391 | ||
Liabilities | |||
Current liabilities | 1,391 | ||
Non-current liabilities | 2,000 | ||
Total liabilities | 3,391 | ||
Stockholders equity: | |||
Common Stock | 0 | ||
Additional paid-in capital | 0 | ||
Accumulated deficit | 0 | ||
Total stockholders' equity | 0 | ||
Total liabilities and stockholders' equity | $ 3,391 | ||
Shares of Common Stock outstanding | 0 | ||
Unaudited Pro Forma [Member] | |||
Assets [Abstract] | |||
Cash, cash equivalents and restricted cash | $ 30,789 | ||
Prepaid expenses and other | 571 | ||
Non-current assets | 108 | ||
Total assets | 31,468 | ||
Liabilities | |||
Current liabilities | 6,988 | ||
Non-current liabilities | 121 | ||
Total liabilities | 7,109 | ||
Stockholders equity: | |||
Common Stock | 293 | ||
Additional paid-in capital | 150,969 | ||
Accumulated deficit | (126,903) | ||
Total stockholders' equity | 24,359 | ||
Total liabilities and stockholders' equity | $ 31,468 | ||
Shares of Common Stock outstanding | 293,321 |
SUBSEQUENT EVENTS - Stock Optio
SUBSEQUENT EVENTS - Stock Option Grants (Details) - $ / shares | Jul. 31, 2019 | Jun. 30, 2019 | Jun. 30, 2018 |
Number of Shares Vested | 9,604 | 11,399 | |
Total Shares Granted | 1,125 | 255 | |
Subsequent Event [Member] | |||
Number of Shares Vested | 4,509 | ||
Number of Shares Unvested | 18,191 | ||
Performance Vesting Shares | 11,250 | ||
Total Shares Granted | 33,950 | ||
Subsequent Event [Member] | Executive Officer [Member] | |||
Exercise Price | $ 0.29 | ||
Number of Shares Vested | 3,588 | ||
Number of Shares Unvested | 11,562 | ||
Performance Vesting Shares | 7,550 | ||
Total Shares Granted | 22,700 | ||
Subsequent Event [Member] | Other Employees [Member] | |||
Exercise Price | $ 0.29 | ||
Number of Shares Vested | 921 | ||
Number of Shares Unvested | 6,629 | ||
Performance Vesting Shares | 3,700 | ||
Total Shares Granted | 11,250 |
SUBSEQUENT EVENTS - Additional
SUBSEQUENT EVENTS - Additional Information (Details) | Jul. 01, 2019$ / h | Sep. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Aug. 31, 2019USD ($)$ / sharesshares | Jul. 31, 2019USD ($)$ / sharesshares | Jul. 23, 2019USD ($)$ / sharesshares | Dec. 31, 2017$ / sharesshares | Aug. 31, 2019USD ($)$ / sharesshares | Sep. 30, 2017$ / sharesshares | Jun. 30, 2019USD ($)$ / sharesshares | Jun. 30, 2018USD ($) |
Financing Activities | |||||||||||
Preferred Stock, Contract Terms | the Company granted each of the New Investors a call option to provide additional financing whereby each New Investor may elect to purchase up to $10.0 million of Common Stock at a purchase price equal to the greater of (i) $0.29 per share or (ii) 75% of the volume weighted average closing price ("VWAP") of the Company's Common Stock during the thirty consecutive trading days prior to the date of the notice. | ||||||||||
Purchase of Common Stock | 65,000 | 10,000,000 | |||||||||
Volume Weighted Average Closing Price of Common Stock | 75.00% | ||||||||||
Share Price | $ / shares | $ 0.29 | ||||||||||
Gross proceeds from issuance of common stock | $ | $ 0 | $ 4,500,000 | |||||||||
Early payments obligation | $ | 3,400,000 | ||||||||||
Restricted Funds | |||||||||||
Proceeds from Issuance of Common Stock | $ | 0 | 4,500,000 | |||||||||
Liabilities, Current | $ | $ 8,379,000 | $ 6,248,000 | |||||||||
Accrued Bonus Payments | |||||||||||
Sale of Stock, Price Per Share | $ / shares | $ 0.40 | $ 0.58 | |||||||||
Private Placement | |||||||||||
Financing Activities | |||||||||||
Stock Issued During Period, Shares, New Issues | 4,500,000 | 13,100,000 | |||||||||
Share Price | $ / shares | $ 1 | ||||||||||
Gross proceeds from issuance of common stock | $ | $ 3,800,000 | ||||||||||
Restricted Funds | |||||||||||
Stock Issued During Period, Shares, New Issues | 4,500,000 | 13,100,000 | |||||||||
Proceeds from Issuance of Common Stock | $ | $ 3,800,000 | ||||||||||
Liabilities, Current | $ | $ 3,800,000 | ||||||||||
Scenario, Forecast [Member] | |||||||||||
Financing Activities | |||||||||||
Early payments made | $ | $ 2,000,000 | $ 1,400,000 | |||||||||
Share-based Compensation Award, Tranche One [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 25.00% | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | ||||||||||
Share-based Compensation Award, Tranche Two [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 75.00% | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 36 months | ||||||||||
Investor [Member] | |||||||||||
Financing Activities | |||||||||||
Stock Issued During Period, Shares, New Issues | 20,000,000 | ||||||||||
Number of shares exercised to purchase aggregate shares of common stock | 69,000,000 | ||||||||||
Proceeds from Stock Options Exercised | $ | $ 20,000,000 | ||||||||||
Share Price | $ / shares | $ 0.29 | ||||||||||
Percent of advisory fee payable | 6.00% | ||||||||||
Net proceeds from private placement | $ | $ 22,600,000 | ||||||||||
Restricted Funds | |||||||||||
Stock Issued During Period, Shares, New Issues | 20,000,000 | ||||||||||
Accrued Bonus Payments | |||||||||||
Early payments to Xoma based on net proceeds from equity financings percent | 15.00% | ||||||||||
Other Investors [Member] | |||||||||||
Financing Activities | |||||||||||
Stock Issued During Period, Shares, New Issues | 14,000,000 | ||||||||||
Proceeds from Stock Options Exercised | $ | $ 4,100,000 | ||||||||||
Restricted Funds | |||||||||||
Stock Issued During Period, Shares, New Issues | 14,000,000 | ||||||||||
Other Investors [Member] | Minimum [Member] | |||||||||||
Financing Activities | |||||||||||
Stock Issued During Period, Shares, New Issues | 20,000,000 | ||||||||||
Restricted Funds | |||||||||||
Stock Issued During Period, Shares, New Issues | 20,000,000 | ||||||||||
Other Investors [Member] | Maximum [Member] | |||||||||||
Financing Activities | |||||||||||
Stock Issued During Period, Shares, New Issues | 30,000,000 | ||||||||||
Restricted Funds | |||||||||||
Stock Issued During Period, Shares, New Issues | 30,000,000 | ||||||||||
Subsequent Event [Member] | |||||||||||
Financing Activities | |||||||||||
Stock Issued During Period, Shares, New Issues | 82,900,000 | ||||||||||
Net proceeds from private placement | $ | $ 22,600,000 | ||||||||||
Restricted Funds | |||||||||||
Stock Issued During Period, Shares, New Issues | 82,900,000 | ||||||||||
Accrued Bonus Payments | |||||||||||
Accrued Bonuses, Current | $ | $ 448,000 | ||||||||||
Common Stock, No Par Value | $ / shares | $ 0.001 | $ 0.001 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 34,000,000 | ||||||||||
Sale of Stock, Price Per Share | $ / shares | $ 0.21 | ||||||||||
Subsequent Event [Member] | 2019 Equity Incentive Plan [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Common Stock Authority To Grant Shares | 15 | ||||||||||
Common Stock Shares Designated | 15,000,000 | ||||||||||
Subsequent Event [Member] | 2016 Equity Incentive Plan [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Common Stock Shares Designated | 19,000,000 | ||||||||||
Subsequent Event [Member] | Minimum [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Stock Issued During Period, Shares, Reverse Stock Splits | 20 | ||||||||||
Subsequent Event [Member] | Maximum [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Stock Issued During Period, Shares, Reverse Stock Splits | 100 | ||||||||||
Subsequent Event [Member] | Officer [Member] | Employee Severance [Member] | Minimum [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Officers compensation | $ | $ 280,000 | ||||||||||
Subsequent Event [Member] | Officer [Member] | Employee Severance [Member] | Maximum [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Officers compensation | $ | 365,000 | ||||||||||
Subsequent Event [Member] | Employment Agreements | Officer [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Officers compensation | $ | $ 1,000,000 | ||||||||||
Subsequent Event [Member] | Employment Agreements | Officer [Member] | Minimum [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Revenue, Remaining Performance Obligation, Percentage | 25.00% | ||||||||||
Subsequent Event [Member] | Employment Agreements | Officer [Member] | Maximum [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Revenue, Remaining Performance Obligation, Percentage | 30.00% | ||||||||||
Subsequent Event [Member] | Employment Agreements | Chief Financial Officer [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Officers compensation | $ | $ 265,000 | ||||||||||
Subsequent Event [Member] | Master Services Agreement [Member] | |||||||||||
Accrued Bonus Payments | |||||||||||
Future Services Fixed Rate | $ / h | 200 | ||||||||||
Subsequent Event [Member] | Investor [Member] | |||||||||||
Financing Activities | |||||||||||
Stock Issued During Period, Shares, New Issues | 69,000,000 | ||||||||||
Number of shares exercised to purchase aggregate shares of common stock | 69,000,000 | ||||||||||
Proceeds from Stock Options Exercised | $ | $ 20,000,000 | ||||||||||
VWAP for the previous thirty consecutive trading days | $ / shares | $ 0.20 | ||||||||||
Share Price | $ / shares | $ 0.29 | ||||||||||
Percent of advisory fee payable | 6.00% | ||||||||||
Amount of advisory fee payable | $ | $ 1,400,000 | $ 1,400,000 | |||||||||
Net proceeds from private placement | $ | $ 22,600,000 | ||||||||||
Restricted Funds | |||||||||||
Stock Issued During Period, Shares, New Issues | 69,000,000 | ||||||||||
Subsequent Event [Member] | Other Investors [Member] | |||||||||||
Financing Activities | |||||||||||
Stock Issued During Period, Shares, New Issues | 14,000,000 | ||||||||||
Share Price | $ / shares | $ 0.29 | $ 0.29 | |||||||||
Gross proceeds from issuance of common stock | $ | $ 4,050,000 | ||||||||||
Restricted Funds | |||||||||||
Stock Issued During Period, Shares, New Issues | 14,000,000 | ||||||||||
Proceeds from Issuance of Common Stock | $ | $ 4,050,000 |