Quarterly report pursuant to Section 13 or 15(d)


9 Months Ended
Sep. 30, 2016
Subsequent Events [Abstract]  



On October 26, 2016, the Company entered into an underwriting agreement with Dawson James Securities, Inc. (“Dawson”) relating to the issuance and sale of an aggregate of 9,500,000 units (“Unit”, and collectively, the “Units”) at a public offering price of $0.55 per Unit in an underwritten public offering (the “October 2016 Financing”). Each Unit consisted of one share of the Company’s common stock, par value $0.001 per share, and a warrant to purchase one-half share of common stock. Because the Company is prohibited from issuing fractional shares, the warrants can only be exercised in lots of two, which means that each holder must exercise two warrants to receive one share of common stock, or an aggregate of 4,750,000 shares of common stock. The warrants have an initial exercise price of $0.63 per share and have a term of five years. The exercise price and number of shares of common stock issuable upon exercise of the warrants will be subject to adjustment in the event of any stock split, reverse stock split, stock dividend, recapitalization, reorganization or similar transaction, as described in the warrants.


The Company also granted Dawson a 45-day option to purchase up to 1,425,000 additional shares of common stock and/or warrants to purchase up to 712,500 shares of common stock, to cover over-allotments, if any.


The October 2016 Financing closed on October 31, 2016. Dawson purchased the Units at an eight-percent discount to the public offering price, for an aggregate discount of approximately $0.4 million (or $0.04 per unit). Dawson also received warrants to purchase up to an aggregate of 473,605 shares of common stock, or approximately five percent of the total number of shares included in the Units. The Company will receive estimated net proceeds from the October 2016 Financing of approximately $4.6 million, after deducting the underwriting discount and other offering expenses of approximately $0.3 million. Additionally, Dawson fully exercised the over-allotment option related to the warrants and purchased additional warrants to acquire 712,500 shares of common stock for net proceeds of approximately $700.