Shareholders' Equity

12 Months Ended

Dec. 31, 2024

Stockholders’ Equity

Warrants to Purchase Common Stock

As of December 31, 2024, the Company has issued and outstanding warrants to purchase shares of the Company’s common stock as follows, which

all met the condition for equity classification (in thousands):


Year Issued	Expiration Date	Number Outstanding as of December 31, 2023		Issued		Exercised			Cancelled/Expired		Number Outstanding as of December 31, 2024		Range of Exercise Price
2017	March 2025 - June 2025		126		—		—			—		126	$0.14 - $21.80
2019	March 2025 - April 2027		44		—		—			—		44	$0.14 - $21.80
2022	August 2025 - December 2029		123		—		(6	)		—		117	$0.14 - $168.35
2023	December 2025 - April 2029		3,211		—		(780	)		—		2,431	$3.25 - $5.26
Total number of shares underlying warrants			3,504		—		(786	)		—		2,718

Warrant Exercises

During the year ended December 31, 2024, the Company issued 786,000 shares of its common stock upon exercise of warrants and received proceeds of $2,000. The exercise price of all shares exercised during the year ended December 31, 2024 ranged from $0.001 to $0.14.

During the year ended December 31, 2023, the Company issued 696,000 shares of its common stock upon exercise of warrants and received proceeds of $30,000. The exercise price of all shares exercised during the year ended December 31, 2023 ranged from $0.001 to $0.14.

Common Stock

Upon completion of the Kineta-Yumanity Merger in December 2022, the number of authorized shares of common stock of the Company was adjusted to 125,000,000 with a par value of $0.001 and all non-voting shares became voting shares. As of December 31, 2024, there were 12,265,496 shares issued and outstanding.

Common stock reserved for future issuance consisted of the following as the period presented:


	December 31, 2024
	(in thousands)
Shares reserved for stock options to purchase common stock under equity incentive plans		2,331
Shares reserved for future issuance of equity awards		766
Shares reserved for exercise of warrants		2,718
Total		5,815

On April 22, 2024, the Company entered into the Settlement Agreement with RLB to continue RLB’s investment in the Company and to resolve any and all potential claims or causes of action in connection with RLB’s failure to purchase $2.5 million of shares of the Company’s common stock pursuant to a financing agreement, dated as of June 5, 2022, as amended on October 24, 2022, December 5, 2022, March 29, 2023, May 1, 2023, July 21, 2023 and October 13, 2023.

Pursuant to the Settlement Agreement, on April 23, 2024, the Company received cash proceeds of $500,000 from RLB and on May 1, 2024, the Company issued 903,995 shares of its common stock to RLB.

During the year ended December 31, 2024, the Company issued 91,000 shares of its common stock for license expenses and recorded $250,000 as license expense within research and development expense.

During the year ended December 31, 2024, the Company issued 82,000 shares of its common stock for professional services and recorded $219,000 as consulting expense within general and administrative expense.

During the year ended December 31, 2024, the Company issued 5,000 shares of its common stock upon vesting of restricted stock units.

For the year ended December 31, 2023, the Company issued 1.2 million shares of its common stock and issued pre-funded warrants exercisable for up to 1,257,387 shares of our common stock to institutional and individual investors, raising net proceeds of $8.6 million.

Private Placement

The Private Placement (see Note 1) provides for the issuance of shares of the Company’s common stock in two closings, one of which occurred immediately following the closing of the Kineta-Yumanity Merger and one of which was expected to occur on April 15, 2024. The first closing of the Private Placement occurred on December 16, 2022 and the Company issued 649,346 shares of its common stock and received net proceeds of $7.4 million to investors that are related parties.

In connection with the Private Placement in December 2022, the Company issued 104,000 warrants to purchase shares of the Company’s non-voting common stock to investors in the Private Placement, each at an exercise price of $0.14, with exercise contingent upon the Kineta-Yumanity Merger closing and exercisable following the first closing of the Private Placement. The Company determined the contingent exercise provisions were indexed to the Company’s operations and the warrants qualified for equity classification.

The second closing of the Private Placement was expected to occur on April 15, 2024, however, the investors failed to fulfill their contractual obligation to fund and the second closing did not occur. Had the second closing of the Private Placement occurred, the Company would have been obligated to issue a number of shares of its common stock based on the aggregate purchase price of $22.5 million divided by the purchase price equal to (a) the VWAP, plus (b) 10% of the VWAP; provided, however, that the share purchase price shall be at least equal to the closing price of the Company’s common stock on March 29, 2023. The Company determined that its obligation to issue additional shares of its common stock in the second closing at a premium to the VWAP was a freestanding financial instrument and a future right, which is subject to fair value. Accordingly, at inception the future right was recorded as an other asset in the Company’s consolidated balance sheet at its fair value equal to 10% of the second closing amount, or $2.3 million. The remaining proceeds from the first closing were allocated to the shares of common stock issued in the first closing and to the warrants as such instruments are equity-classified. The future right was subject to remeasurement at each reporting date and the Company used the Monte Carlo simulation method to determine fair value of approximately $3.8 million as of December 31, 2023 and zero as of December 31, 2024 as the second closing did not occur. The Company incurred insignificant issuance costs related to the Private Placement.

- Definition

The entire disclosure for equity.

+ References

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+ Details

KINETA, INC./DE 10-K