$20 Million funding
Lincoln Park Capital
In March 2014, we entered into an agreement with Lincoln Park Capital Fund LLC (“LPC”) for an equity financing agreement. LPC is obligated to purchase up to $20.0 million of the Company’s common stock from time to time over a 30 month period, in amounts up to $0.5 million per sale as directed by the Company and subject to certain requirements, restrictions and limitations. There are no upper limits to the price LPC may pay to purchase our common stock and the purchase price is based on prevailing market prices of our stock at the time of sales without any fixed discount, We control the timing and amount of any sales to LPC In addition, we may direct LPC to purchase additional amounts as accelerated purchases the closing price of our stock is not below certain threshold price. We filed a registration statement with the SEC covering the shares issuable to LPC. As of December 31, 2015, we had approximately $17.3 million available to us under the agreement.
Through December 31, 2015, the Company has sold an additional 37,445,801 shares of common stock for gross proceeds of $2.8 million under its agreement with LPC.
Common stock private placement
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In March 2014, the Company entered into an equity financing agreement (“LPC Purchase Agreement”) with Lincoln Park Capital Fund LLC (“LPC”) whereby LPC is obligated to purchase up to $20.0 million of the Company’s common stock from time to time over a 30 month period, as directed by the Company and subject to certain requirements, restrictions and limitations. Under the LPC Purchase Agreement, the per share purchase price will be the lesser of the lowest sale price of common stock on the purchase date or the average of the three lowest closing purchase prices during the ten consecutive business days prior to the purchase date. However, LPC is not obligated to purchase shares from the Company on any date that the closing price of the common stock is below $6.00, subject to adjustment upon the occurrence of certain stock related events. The Company may also request that LPC purchase shares under an accelerated purchase notice whereby the per share purchase price will be the lower of (i) 94% of a volume weighted average price calculation as determined under the LPC Purchase Agreement or (ii) the closing price of the common stock on the accelerated purchase date.
Concurrently with the execution of the LPC Purchase Agreement, LPC purchased an initial 26,667 shares for gross proceeds of $0.4 million.
In consideration for entering into the LPC Purchase Agreement, the Company issued 63,333 shares of common stock to LPC (the ‘Commitment Fee Shares’), 40,000 upon entering into the agreement and 23,333 contingently issuable on a pro rata basis as the Company utilizes the financing arrangement. The agreement will automatically terminate upon the earlier of 30 months (August 2016) or upon full utilization of the purchase commitment.
The fair value of the 40,000 Commitment Fee Shares initially issued to LPC was approximately $0.5 million at issue and initially recorded as a deferred funding fee asset. The fee, as well as fair value at issue of subsequent Commitment Fee Shares, has been recognized as additional paid in capital as of December 31, 2014.
During the first quarter of 2015 under the Lincoln Park Capital Fund LLC financing arrangement the Company sold 256,305 common shares and issued 3,290 common shares as a commitment fee for a total of $2.8 million.
