Filing Details

Item 3. Source and Amount of Funds or Other Consideration

Tang Capital Partners, LP is the record owner of $5,841,685 principal amount of Notes, which may be converted into Common Stock at a conversion rate of 1,250 shares per $1,000 principal amount of Notes, subject to certain limitations discussed below. Tang Capital Partners, LP has no right to convert the Notes to the extent that after giving effect to such conversion Tang Capital Partners, LP (together with its affiliates) would beneficially own in excess of the Maximum Percentage, which is currently set at 9.99%, of the number of shares of Common Stock of the Company outstanding immediately after giving effect to such conversion. Tang Capital Partners, LP can increase or decrease the Maximum Percentage for its Notes by written notice to the Company, provided that such increase or decrease will not be effective until 61 days after delivery of the notice. The foregoing limitations remain in effect with respect to such Notes, and, accordingly, only 5,681,391 shares are currently issuable upon conversion of such Notes.

Tang Capital Management, LLC, as the general partner of Tang Capital Partners, LP, may be deemed to beneficially own the 9,098,594 shares of Common Stock beneficially owned by Tang Capital Partners, LP. Tang Capital Management, LLC shares voting and dispositive power over such shares with Tang Capital Partners, LP and Kevin Tang.

Kevin Tang is the beneficial owner of 9,579,929 shares of Common Stock, comprising: (i) the 9,098,594 shares beneficially owned by Tang Capital Partners, LP; (ii) 297,714 shares held by the Kevin C. Tang Foundation (iii) 162,333 shares issuable upon exercise of options held by Kevin Tang that are exercisable within 60 days of this Statement; (iv) 6,575 shares owned by Kevin Tang’s minor children under the Uniform Transfers to Minors Act, for which Kevin Tang serves as trustee; (v) 5,732 shares held by the Kevin C. Tang Family Trust, for which Kevin Tang serves as trustee; (vi) 4,794 shares owned directly by Kevin Tang; (vii) 2,147 shares held by Kevin Tang’s Individual Retirement Account; and (viii) 2,040 shares owned by the Tang Advisors, LLC Profit Sharing Plan, for which Kevin Tang serves as trustee and is a participant. Mr. Tang also owns additional stock options to purchase up to 14,167 shares of Common Stock that are excluded from his beneficial ownership as of the date of this Statement, as they are not exercisable within 60 days from such date.

Tang Capital Management, LLC, as the general partner of Tang Capital Partners, LP, and Kevin Tang, as the manager of Tang Capital Management, LLC, may also be deemed to beneficially own the shares beneficially owned by Tang Capital Partners, LP. Kevin Tang is a beneficiary and the sole trustee of the Kevin C. Tang Family Trust and has voting and dispositive power over the shares held by the Kevin C. Tang Family Trust. The Kevin C. Tang Foundation is a private foundation for which Kevin Tang serves as President and Treasurer. Mr. Tang has voting and dispositive power over the shares held by this foundation, which is a not-for-profit corporation incorporated in the state of Delaware. The mailing address of all of the foregoing persons and entities is c/o Tang Capital Management, LLC, 4747 Executive Drive, Suite 510, San Diego, CA 92121.

The percentages used herein for Tang Capital Partners, LP and Tang Capital Management, LLC are based upon 95,732,853 shares of Common Stock (90,051,462 shares of Common Stock reported to be issued and outstanding as of October 30, 2019, as set forth in the Issuer’s Quarterly Report on Form 10-Q that was filed with the SEC on November 12, 2019, plus an additional 5,681,391 shares of Common Stock currently issuable upon conversion of the Notes). The percentages used herein for Kevin Tang are based upon 95,895,186 shares of Common Stock outstanding (95,732,853 shares of Common Stock outstanding as described in the foregoing sentence, plus an additional 162,333 shares of Common Stock issuable upon exercise of options granted to Kevin Tang).

In addition, the Kevin C. Tang Foundation sold 16,711 shares of the Issuer’s Common Stock on December 18, 2019 at a weighted average price/share of $24.9773.