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STOCKHOLDERS’ EQUITY
6 Months Ended
Sep. 30, 2023
Equity [Abstract]  
STOCKHOLDERS’ EQUITY

NOTE 4 STOCKHOLDERS’ EQUITY

 

On February 4, 2022, the Company entered into an At-The-Market Equity Offering Sales Agreement with Truist Securities, Inc. and Oppenheimer & Co, Inc. (the “2022 ATM”), allowing the Company to sell its common stock for aggregate sales proceeds of up to $50.0 million from time to time and at various prices, subject to the conditions and limitations set forth in the 2022 ATM. If shares of the Company’s common stock are sold, there is a 3% fee paid to the sales agent.

 

For the six months ended September 30, 2023, the Company received net proceeds of $6.5 million from the sale of 1,191,349 shares of common stock. As of September 30, 2023, there were $39.8 million in funds available under the 2022 ATM. For the six months ended September 30, 2022, the Company received net proceeds of $0.2 million from the sale of 19,300 shares of common stock.

 

The Company received net proceeds of $0.2 million for 42,500 shares of common stock from the exercise of stock options in May 2023.

 

Stock Option Plans

 

The Company’s Fifth Amended and Restated 2013 Beyond Air Equity Incentive Plan (the “2013 BA Plan”) allows for awards to officers, directors, employees, and consultants of stock options, restricted stock units and restricted shares of the Company’s common stock. On January 9, 2023, the Company’s Board of Directors approved an amendment to the 2013 BA Plan to increase the number of shares in the 2013 BA Plan by 3,000,000, which was approved by the Company’s stockholders at the 2023 annual stockholder meeting on March 9, 2023. The 2013 BA Plan has 10,600,000 shares authorized for issuance. As of September 30, 2023, 417,376 shares were available under the 2013 BA Plan.

 

Restricted Stock Units

 

The fair value for the restricted stock unit awards was valued at the closing price of the Company’s common stock on the date of grant. Restricted stock units vest annually over five years.

 

A summary of the Company’s restricted stock unit awards for the quarterly period ended September 30, 2023 is as follows:

   

  

Number Of

Shares

  

Weighted

Average Grant

Date Fair

Value

 
         
Unvested as of April 1, 2023   1,101,100   $     6.78 
Granted   1,000    5.65 
Vested   -    - 
Forfeited   (6,800)   5.06 
Unvested as of September 30, 2023   1,095,300   $6.79 

 

Stock-based compensation expense related to these stock issuances for the three months ended September 30, 2023 and September 30, 2022 was $0.7 million and $0.7 million respectively.

 

Stock-based compensation expense related to these stock issuances for the six months ended September 30, 2023 and September 30, 2022 was $1.5 million and $1.4 million respectively. The unrecognized compensation cost is $3.6 million and the weighted average remaining service period is 1.6 years.

 

 

BEYOND AIR, INC. AND ITS SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

 

NOTE 4 STOCKHOLDERS’ EQUITY (continued)

 

A summary of the change in options for the six months ended September 30, 2023,is as follows:

  

Number of

Options

  

Weighted

Average

Exercise

Price of

Options

  

Weighted

Average

Remaining

Contractual

Life of

Options

  

Aggregate

Intrinsic

Value

(in thousands)

 
                 
Options outstanding as of April 1, 2023   8,198,881   $5.83    8.4   $8,306 
Granted   102,500    4.48    -    - 
Exercised   (42,500)   5.10    -    - 
Forfeited   (130,855)   6.58    -    - 
Outstanding as of September 30, 2023   8,128,026   $5.83    7.6   $- 
Exercisable as of September 30, 2023   3,580,901   $5.14    5.9   $- 

 

The Company’s 2021 Beyond Cancer Ltd Equity Incentive Plan (the “2021 BC Plan”) allows for awards to officers, directors, employees, and consultants of stock options, restricted stock units and restricted shares of Beyond Cancer’s common shares. The vesting terms of the options issued under the 2021 BC Plan are generally four years and expire ten years from the grant date. On December 1, 2021, Beyond Cancer’s Board of Directors approved to reserve for issuance 2,000,000 common shares. On November 3, 2022, Beyond Cancer’s Board of Directors approved to reserve for issuance an additional 2,000,000 common shares. The 2021 BC Plan has 4,000,000 common shares authorized for issuance. As of September 30, 2023, 237,250 common shares were available under the 2021 BC Plan.

 

  

Number of

Options

  

Weighted

Average

Exercise

Price of

Options

  

Weighted

Average

Remaining

Contractual

Life of

Options

  

Aggregate

Intrinsic

Value

(thousands)

 
                 
Options outstanding as of April 1, 2023   3,817,000   $2.88    9.2   $23,486 
Granted   80,000    5.50    -    - 
Exercised   -    -    -    - 
Forfeited   (134,250)   5.50    -    - 
Outstanding as of September 30, 2023   3,762,750   $5.50    8.7   $- 
Exercisable as of September 30, 2023   455,500   $5.50    8.3   $- 

 

As of September 30, 2023, the Company had unrecognized stock-based compensation expense in the 2013 BA Plan of approximately $11.5 million which was expected to be expensed over the weighted average remaining service period of 1.5 years.

 

As of September 30, 2023, the Company had unrecognized stock-based compensation expense in the 2021 BC Plan of approximately $13.6 million which is expected to be expensed over the weighted average remaining service period of 1.5 years. On September 7, 2023, Beyond Cancer’s Board of Directors approved a modification to the exercise prices of all previously issued options to $5.50 per share. For the six months ended September 30, 2023 and September 30, 2022, the weighted average fair value of options granted was $4.59 and $5.98 per share, respectively. In line with ASC718, we have amended the stock compensation expense to reflect this de minimis adjustment.

 

 

BEYOND AIR, INC. AND ITS SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

 

NOTE 4 STOCKHOLDERS’ EQUITY (continued)

 

The following was utilized to calculate the fair value of options on the date of grant:

 

 

  

September 30,

2023

  

September 30,

2022

 
Risk-free interest rate   4.34.5%   2.53.7%
Expected volatility (Beyond Air)   81.781.9%   87.4 - 89.1%
Expected volatility (Beyond Cancer)   104.3106.2%   104.7-106.7%
Dividend yield   0%   0%
Expected terms (in years)   6.25    6.25 

 

The following summarizes the components of stock-based compensation expense which included stock options and restricted stock units for the three and six months ended September 30, 2023 and September 30, 2022:

 

(in thousands)  2023   2022   2023   2022 
   Three Months Ended   Six Months Ended 
   September 30,   September 30, 
(in thousands)  2023   2022   2023   2022 
Research and development  $1,379   $1,002   $2,585   $1,957 
General and administrative   5,081    3,713    9,990    7,381 
Total stock-based compensation expense  $6,460   $4,714   $12,575   $9,338 

 

Warrants

 

A summary of the Company’s outstanding warrants as of September 30, 2023 is as follows:

 

Warrant Holders 

Number of

Warrants

  

Exercise

Price

  

Intrinsic Value

(in thousands)

  

Date of

Expiration

 
                 
Third-party license agreement   208,333   $4.80   $        -    January 2024 
March 2020 loan   172,187   $7.26    -    March 2025 
NitricGen agreement   80,000   $6.90    -    January 2028 
Avenue agreement   233,843   $5.88    -    June 2028 
Total   694,363   $6.02   $-      

 

Warrants to purchase up to 233,843 of Company common stock were issued to Avenue Venture Opportunities Fund, L.P., a Delaware limited partnership (“Avenue”), and Avenue Venture Opportunities Fund II, L.P, a Delaware limited partnership (“Avenue 2” and, together with Avenue, the “Lenders”) in the six months ended September 30, 2023 and are liability classified. No warrants were exercised in this period. All other warrants outstanding are equity classified. There were zero warrants issued or exercised in the six months ended September 30, 2022.

 

 

BEYOND AIR, INC. AND ITS SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)