Item 2. Unregistered Sales of Equity Securities
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Unregistered Sales of Equity Securities
Stock Option Grants and Exercises
For the three months ended March 31, 2021, we granted options to purchase 2,273,285 shares of our common stock to certain of our employees and directors with a weighted-average exercise price of $5.06 per share. In April 2021, we granted options to purchase 98,000 shares of our common stock to certain of our directors, each with an exercise price of $15.00 per share. In March 2021, we issued 95,123 shares of common stock pursuant to the exercise of options, including 24,460 shares of unvested shares, each at an exercise price of $1.97 per share, for aggregate proceeds of $0.2 million.
The offer, sale and issuance of these options and the issuance of shares upon exercise of options were deemed to be exempt from registration under the Securities Act in reliance on either Rule 701 in that the transactions were under compensatory benefit plans and contracts relating to compensation as provided under Rule 701 or Section 4(a)(2) in that the issuance of securities was to accredited investors in a private placement transaction that did not involve a public offering.
Issuance of Series B Convertible Preferred Stock
In March 2021, we issued an aggregate of 23,440,514 shares of Series B convertible preferred stock to a total of 15 accredited investors at a purchase price of $2.0215 per share, for aggregate consideration of $47,384,999.11. The offer, sale and issuance of these shares of Series B convertible preferred stock were deemed to be exempt from registration under the Securities Act in reliance on Section 4(a)(2) of the Securities Act (and Regulation D promulgated thereunder).
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Issuance of Common Stock upon Conversion of Convertible Preferred Stock
On April 13, 2021, upon the closing of our IPO, all shares of our then-outstanding convertible preferred stock automatically converted into 15,907,629 shares of common stock. The common stock was issued pursuant to the exemption from the registration requirements of the Securities Act provided by Section 3(a)(9) or Section 4(2) of the Securities Act.
Use of Proceeds
We commenced our IPO pursuant to the registration statement on Form S-1 (File No. 333-254534) that was declared effective on April 8, 2021 and registered an aggregate of 7,187,500 shares of our common stock. On April 13, 2021, we completed our IPO and sold 6,250,000 shares of our common stock at a public offering price of $15.00 per share for aggregate gross proceeds of $93.8 million. Jefferies LLC, SVB Leerink LLC and Piper Sandler & Co. acted as joint book-running managers.
The underwriting discounts and commissions for the offering totaled approximately $6.6 million. We incurred additional expenses of approximately $2.4 million in offering expenses, which when added to the underwriting discounts and commissions paid by us, amounts to total fees and costs of approximately $9.0 million. Thus, net offering proceeds to us, after deducting underwriting discounts and commissions and offering expenses, were approximately $84.8 million. No offering costs were paid directly or indirectly to any of our directors or officers (or their associates) or persons owning ten percent or more of any class of our equity securities or to any other affiliates.
Upon receipt, the net proceeds from our IPO were held in cash and cash equivalents. Through May 19, 2021, we have not used any of the net proceeds from our IPO. We are investing these funds in a combination of short-term, interest-bearing obligations, investment-grade instruments, certificates of deposit or direct or guaranteed obligations of the U.S. government. We expect to use the net proceeds from our IPO as described under “Use of Proceeds” in the Prospectus. We cannot predict with certainty all of the particular uses for the net proceeds from our IPO, or the amounts that we will actually spend on the uses described under “Use of Proceeds” in the Prospectus. The amounts and timing of our actual use of the net proceeds will vary depending on numerous factors, including our ability to access additional financing and the relative success and cost of our research, preclinical and clinical development programs. As a result, our management will have broad discretion in the application of the net proceeds, and investors will be relying on our judgment regarding the application of the net proceeds from our IPO.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
None.
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.