Subsequent Events

9 Months Ended

Sep. 30, 2018

Subsequent Events [Abstract]

Subsequent Events

14. Subsequent Events

Seventh Amended and Restated Certificate of Incorporation and Reverse Stock Split

In October 2018, the Company implemented a 11.0634-for-1 reverse stock split of its outstanding common stock and redeemable convertible preferred stock, which became effective upon filing of the Company’s Seventh Amended and Restated Certificate of Incorporation on October 4, 2018. The accompanying condensed financial statements give retroactive effect to the stock split for all periods presented.

Initial Public Offering, Conversion of Preferred Stock, Eighth Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws

In October 2018, the Company completed its IPO of 9,864,666 shares of common stock at an offering price of $5.00 per share. The Company received net proceeds of approximately $43.0 million, after deducting underwriting discounts, commissions and estimated offering-related transaction costs. Upon the closing of the IPO on October 22, 2018, all shares of Preferred Stock were automatically converted into an aggregate of 13,225,114 shares of common stock.

In connection with the closing of the IPO, the Company filed an Eighth Amended and Restated Certificate of Incorporation (the “Post-IPO Certificate”) with the Secretary of State of the State of Delaware on October 22, 2018. The Company’s board of directors and stockholders previously approved the Post-IPO Certificate to be filed in connection with, and to be effective upon, the closing of the IPO, and the form of the Post-IPO Certificate was filed as an exhibit to the Company’s Registration Statement on Form S-1 (the “Registration Statement”) filed in connection with the IPO. On October 22, 2018, the Company’s Amended and Restated Bylaws (the “Post-IPO Bylaws”) became effective in connection with the closing of the IPO. The Company’s board of directors and stockholders previously approved the Post-IPO Bylaws to become effective upon the closing of the IPO, and the form of the Post-IPO Bylaws was filed as an exhibit to the Registration Statement.

The Post-IPO Certificate amends and restates in its entirety the Company’s Seventh Amended and Restated Certificate of Incorporation and the Post-IPO Bylaws amend and restate, in their entirety, the Company’s Bylaws. Collectively, the Post-IPO Certificate and the Post-IPO Bylaws, among other things: (i) authorize 200,000,000 shares of common stock; (ii) eliminate all references to the previously existing series of Preferred Stock; (iii) authorize 10,000,000 shares of undesignated preferred stock that may be issued from time to time by the Company’s board of directors in one or more series; (iv) provide that the Company’s board of directors be divided into three classes with staggered three-year terms, with one class of directors to be elected at each annual meeting of the Company’s stockholders; (v) provide that directors may only be removed with cause and only upon the affirmative vote of holders of at least two-thirds of the voting power of all then-outstanding shares of capital stock of the Company entitled to vote generally in the election of directors; (vi) provide that, subject to limited exceptions, vacancies on the Company’s board of directors shall only be filled by the remaining members of the Board; (vii) eliminate the ability of the Company’s stockholders to take action by written consent in lieu of a meeting; and (viii) provide that only the Company’s board of directors, the chairman of the board or the chief executive officer may call a special meeting of stockholders.

Approval of 2018 Plan

The Company’s board of directors and stockholders approved the 2018 Plan in October 2018. The 2018 Plan became effective on October 17, 2018 (the “2018 Plan Effective Date”). On and after the 2018 Plan Effective Date, no additional stock awards will be granted under the 2002 Plan.

The 2018 Plan provides for the grant of incentive stock options (“ISOs”), nonstatutory stock options (“NSOs”), stock appreciation rights, restricted stock awards, restricted stock unit awards, performance stock awards, performance cash awards and other forms of stock awards to employees, directors and consultants, including employees and consultants of the Company’s affiliates, as defined in the 2018 Plan.

Initially, the maximum number of shares of the Company’s common stock that may be issued under the 2018 Plan will be 3,231,626 shares. The number of shares of common stock reserved for issuance under the 2018 Plan will automatically increase on January 1 of each calendar year, starting on January 1, 2019 through January 1, 2028, in an amount equal to 3% of the total number of shares of the Company’s capital stock outstanding on the last day of the calendar month before the date of each automatic increase, or a lesser number of shares determined by the Company’s board of directors. The maximum number of shares of the Company’s common stock that may be issued on the exercise of incentive stock options under the 2018 Plan is 9,694,878.

Approval of 2018 Employee Stock Purchase Plan

The Company’s board of directors and stockholders approved the 2018 Employee Stock Purchase Plan (the “ESPP”) in October 2018. The ESPP became effective on October 17, 2018. The purpose of the ESPP is to secure the services of new employees, to retain the services of existing employees and to provide incentives for such individuals to exert maximum efforts toward the Company’s success and that of the Company’s affiliates. The ESPP is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the Code for U.S. employees.

The ESPP authorizes the issuance of 196,000 shares of the Company’s common stock under purchase rights granted to the Company’s employees or to employees of any of the Company’s designated affiliates. The number of shares of common stock reserved for issuance will automatically increase on January 1 of each calendar year, beginning on January 1, 2019 through January 1, 2028, by the lesser of (1) 1% of the total number of shares of the Company’s common stock outstanding on the last day of the calendar month before the date of the automatic increase, and (2) 490,000 shares; provided that before the date of any such increase, the Company’s board of directors may determine that such increase will be less than the amount set forth in clauses (1) and (2). As of the date hereof, no shares of common stock have been purchased under the ESPP.

Exercises of Warrants

In connection with the IPO, stockholders exercised warrants to purchase an aggregate of 632,887 shares of the Company’s redeemable convertible preferred stock, at a weighted-average exercise price of $0.12 per share, and all such shares were automatically converted into an aggregate of 632,887 shares of common stock.