CASTLE BIOSCIENCES INC 10-K

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our Common Stock, $0.001 par value per share, began trading on the Nasdaq Global Market under the symbol “CSTL” on July 25, 2019. Prior to that date, there was no public trading market for our common stock. Holders of Record As of March 5, 2021, there were approximately 108 stockholders of record of our common stock, which does not include shares held in street name. Dividend Policy We have never declared or paid cash dividends on our capital stock. We currently intend to retain all available funds and any future earnings for use in the operation of our business and do not anticipate paying any dividends on our common stock in the foreseeable future. Any future determination to declare dividends will be made at the discretion of our board of directors and will depend on, among other factors, our financial condition, operating results, capital requirements, contractual restrictions, general business conditions and other factors that our board of directors may deem relevant. Securities Authorized for Issuance Under Our Equity Compensation Plans Information regarding securities authorized for issuance under our equity compensation plans is incorporated herein by reference to Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” of Part III of this Annual Report on Form 10-K. Performance Graph Not required for smaller reporting companies. Recent Sales of Unregistered Equity Securities On December 11, 2020, we issued 209,238 shares of our common stock to SH Castle Biosciences, LLC upon the net exercise of a warrant to purchase 209,243 shares of common stock at an exercise price of approximately $0.001 per share. Additionally, we paid $41 in cash to SH Castle Biosciences, LLC for the value of a fractional share of common stock computed in connection with such net exercise. The net exercise was based on a fair market value of our common stock of $59.16 per share and did not result in any cash proceeds to us. On December 29, 2020, we issued an aggregate of 31,814 shares of our common stock to OTA LLC upon the net exercise of certain warrants to purchase an aggregate of 35,237 shares of common stock at an exercise price of approximately $7.10 per share. The warrants were originally issued to Oxford Finance LLC on March 31, 2017 and November 30, 2018, but were later transferred to OTA LLC in August 2020. We paid an aggregate of $58 in cash to OTA LLC for the value of fractional shares computed in connection with such net exercises. In accordance with the terms of the warrants, the net exercises were based on the fair market value of our common stock on the business day immediately prior to the date of delivery of the exercise notices, in each case $73.05 per share, and did not result in any cash proceeds to us. The issuances of these shares of common stock were deemed to be exempt from registration under the Securities Act in reliance on Section 4(a)(2) (or Regulation D promulgated thereunder) in that the issuance of securities was to an accredited investor and did not involve a public offering. The recipient of securities in each of these transactions acquired the securities for investment only and not with a view to or for sale in connection with any distribution thereof and appropriate legends were affixed to the securities issued in these transactions. The recipient of the securities in these transactions was an accredited investor under Rule 501 of Regulation D. 73 Table of Contents Use of Proceeds from IPO of Common Stock On July 29, 2019, we completed the initial public offering of our common stock, or the IPO, pursuant to which we issued and sold 4,600,000 shares of our common stock, including 600,000 shares associated with the full exercise of the underwriters’ option to purchase additional shares, at a price to the public of $16.00 per share. The offer and sale of all of the shares of our common stock in the IPO were registered under the Securities Act pursuant to our Registration Statements on Form S-1, as amended (File Nos. 333-232369 and 333-232796), which were declared or became effective on July 24, 2019. SVB Leerink LLC and Robert W. Baird & Co. Incorporated acted as joint book-running managers for the IPO and as representatives of the underwriters. Canaccord Genuity LLC and BTIG, LLC acted as co-managers for the IPO. We received gross proceeds from the IPO of $73.6 million, or net proceeds of $65.9 million after deducting $5.2 million in underwriting discounts and commissions and $2.5 million of offering expenses. None of the underwriting discounts and commissions or offering expenses were incurred or paid, directly or indirectly, to any of our directors or officers or their associates or to persons owning 10% or more of our common stock or to any of our affiliates. There has been no material change in our planned use of the net proceeds from the IPO as described in the final prospectus filed with the SEC on July 26, 2019 relating to our Registration Statements on Form S-1 (File Nos. 333-232369 and 333-232796). Since the effective date of our registration statement through December 31, 2020, we have not used any of the net proceeds from the IPO. Pending such uses, we have invested, and plan to continue to invest, the balance of the net proceeds from the IPO in cash and cash equivalent securities or highly liquid investment securities. Purchases of Equity Securities by the Issuer and Affiliated Purchasers None. Item 6. Selected Financial Data. Not required for smaller reporting companies.