Page 11 of 14 – SEC Filing
| Item 4. | Ownership |
| (a) | Amount beneficially owned: |
On October 11, 2017, the Reporting
Persons participated in a private placement (the “Private Placement”) with the Issuer. Pursuant to the Private Placement,
the Reporting Persons acquired in the aggregate 9,037,054 Shares of Common Stock and warrants (the “Warrants”) exercisable
for an aggregate of 2,439,932 Shares of Common Stock. Pursuant to the Private Placement, the Warrants are subject to an exercise
limitation, and may not be exercised if, after such exercise, the Reporting Persons would beneficially own in the aggregate, as
determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, more than 19.9% of the number of shares of
Common Stock then issued and outstanding. Such Warrants have an initial exercise price of $1.75 per Share, subject to adjustment
pursuant to the terms of the Warrants, and expire on October 11, 2021. As of October 16, 2017, the warrant exercise limitation
described in the prior sentence limits the aggregate exercise of the Warrants by the Reporting Persons to 1,116,177 out of the
2,439,932 shares of Common Stock underlying the Warrants owned by the Reporting Persons in the aggregate. In providing beneficial
ownership described herein, the Reporting Persons have assumed 1,116,177 of the 1,201,053 warrants owned by BVF would be exercised.
BVF2 holds warrants to purchase 823,231 additional shares which are excluded herein as a result of the 19.9% limitation. BVTOS
holds warrants to purchase 199,687 additional shares which are excluded herein as a result of the 19.9% limitation. The Reporting
Persons through certain managed accounts holds warrants to purchase 215,961 additional shares which are excluded herein as a result
of the 19.9% limitation.
As of October 16, 2017 (i) BVF beneficially
owned 8,821,008 shares of Common Stock, including 1,116,177 shares of Common Stock issuable upon the exercise of certain Warrants,
(ii) BVF2 beneficially owned 5,124,370 shares of Common Stock, and (iii) Trading Fund OS beneficially owned 1,378,710 shares of
Common Stock.
Partners OS as the general partner
of Trading Fund OS may be deemed to beneficially own the 1,378,710 shares of Common Stock beneficially owned by Trading Fund OS.
Partners, as the general partner of
BVF, BVF2, the investment manager of Trading Fund OS, and the sole member of Partners OS, may be deemed to beneficially own the
17,553,089 shares of Common Stock beneficially owned in the aggregate by BVF, BVF2, Trading Fund OS, and certain Partners managed
accounts (the “Partners Managed Accounts”), including 2,229,001 shares of Common Stock held in the Partners Managed
Accounts.
BVF Inc., as the general partner of
Partners, may be deemed to beneficially own the 17,553,089 shares of Common Stock beneficially owned by Partners.
Mr. Lampert, as a director and officer
of BVF Inc., may be deemed to beneficially own the 17,553,089 shares of Common Stock beneficially owned by BVF Inc.
The foregoing should not be construed
in and of itself as an admission by any Reporting Person as to beneficial ownership of any shares of Common Stock owned by another
Reporting Person. Partners OS disclaims beneficial ownership of the shares of Common Stock beneficially owned by Trading Fund OS.
Each of Partners, BVF Inc. and Mr. Lampert disclaims beneficial ownership of the shares of Common Stock beneficially owned by BVF,
BVF2, Trading Fund OS, and the Partners Managed Accounts, and the filing of this statement shall not be construed as an admission
that any such person or entity is the beneficial owner of any such securities.
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