Annual report pursuant to Section 13 and 15(d)

Shareholders' Equity

Shareholders' Equity
12 Months Ended
Dec. 31, 2015
Equity [Abstract]  
Shareholders' Equity

8. Shareholders’ Equity

Common Stock

Award Of Shares to Non-employee Directors

On May 30, 2014, each continuing non-employee Director, Frederick Telling, Charles Pope, Alan Dunton, Christine Koski and Robert Koski were granted an award of 10,000 fully vested shares of the Company’s common stock under the Company’s 2012 Equity Incentive Plan as part of the Company’s non-employee Director compensation program. The Company recognized $102,500 in expense relating to this award.

On March 16, 2015, in connection with and in furtherance of the new equity based award program, the Board approved the award of 40,000 restricted shares of Company common stock to each of the Company’s non-employee directors, Frederick Telling, Charles Pope, Alan Dunton, Christine Koski and Robert Koski under the Company’s 2012 Plan of which a total of 40,000 restricted shares have vested as of December 31, 2015 for each non-employee director. The awards were considered issued and outstanding as of the date of the grant and were eligible to be voted by the recipient. The Company recognized $264,000 in compensation expense relating to these awards.

Exclusive Chanel Collaboration Agreement with Intrexon-Oral Mucositis–Share Issuance

On December 1, 2015, the Company issued a Notice of Conversion to Intrexon indicating 3,381,004 shares of Company common stock has been issued to Intrexon effective December 1, 2015 in connection with the conversion of the Convertible Promissory Note (the “Note”) and in satisfaction of the Company’s obligations under the Note.


The Note was previously issued by the Company to Intrexon on June 9, 2015 as payment of the technology access fee under the Exclusive Channel Collaboration Agreement entered into with respect to the Company’s research, development and commercialization of products, including the continued development and commercialization of AG013, for use in the treatment of oral mucositis in humans and/or the administration to humans of a trefoil factor via genetically modified bacteria (including L. lactis) for the treatment of diseases and conditions of the oral cavity, throat, and esophagus, but, in any case, excluding the delivery of anti-cancer effectors for the purpose of treatment or prophylaxis of cancer. The Note was payable to Intrexon, at the Company’s option, in cash or shares of Company common stock prior to the maturity date of December 31, 2015 and the conversion price was equal to the closing price on the NYSE MKT of the Company’s common stock on the last trading day immediately prior to the date of conversion, December 1, 2015 which was $1.50 per share.


The Company’s outstanding and exercisable warrants as of December 31, 2015 are presented below:


Exercise Price

    Warrants Outstanding     Expiration Dates  
$ 1.50        175,584        7/31/17   







On January 13, 2014, 210,000 previously issued warrants were exercised resulting in the net issuance of 135,000 shares of our common stock.

On March 23, 2015, warrants to acquire 2,170,925 shares of the Company’s common stock at a price of $2.00 per share expired.

On August 3, 2015, Griffin Securities Inc. exercised 185,585 of their previously issued warrants on a net issuance basis resulting in the issuance of 98,592 shares of our common stock.

As of December 31, 2015, there are 175,584 warrants and 1,471,031 stock options outstanding. If all warrants and stock options were exercised, the total number of outstanding common shares would be 41,505,155 as of December 31, 2015.