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Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to            .

Commission File Number: 001-37350

InVivo Therapeutics Holdings Corp.

(Exact name of registrant as specified in its charter)

Nevada

36-4528166

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification Number)

One Kendall Square, Suite B14402

Cambridge, MA

02139

(Address of principal executive offices)

(Zip code)

(617) 863-5500

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.00001 par value per share

NVIV

The Nasdaq Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes     No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes     No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  

    

Accelerated filer  

Non-accelerated filer  

Smaller reporting company  

Emerging growth company  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b2 of the Act). Yes No

As of November 4, 2021, 34,264,806 shares of the registrant’s Common Stock, $0.00001 par value, were issued and outstanding.

Table of Contents

INVIVO THERAPEUTICS HOLDINGS CORP.

Quarterly Report on Form 10-Q for the Quarter Ended September 30, 2021

TABLE OF CONTENTS

     

Page

1. Risk Factors Summary

3

PART I

FINANCIAL INFORMATION

1. Financial Statements (Unaudited)

4

Consolidated Balance Sheets as of September 30, 2021 and December 31, 2020

4

Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2021 and 2020

5

Consolidated Statements of Changes in Stockholders’ Equity for the Three and Nine Months Ended September 30, 2021 and 2020

6

Consolidated Statements of Cash Flows for the Three and Nine Months Ended September 30, 2021 and 2020

7

Notes to Consolidated Financial Statements

8

2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

21

3. Quantitative and Qualitative Disclosures about Market Risk

27

4. Controls and Procedures

27

PART II

OTHER INFORMATION

1A. Risk Factors

28

6. Exhibits

52

2

Table of Contents

Risk Factors Summary

Our business is subject to a number of risks of which you should be aware before making an investment decision. Below we summarize what we believe are the principal risk factors but these risks are not the only ones we face, and you should carefully review and consider the full discussion of our risk factors in the section titled “Risk Factors”, together with the other information in this Quarterly Report.

We have found it difficult and may continue to find it difficult to enroll patients in our clinical studies, which could delay or prevent clinical studies of our product candidates, and due to such enrollment delays, we may need to make a determination as to the next steps for our clinical program that could significantly impact our future operations and financial position.

The COVID-19 pandemic has delayed and may continue to delay our ability to complete our ongoing INSPIRE 2.0 clinical trial or may delay the initiation of future clinical trials, disrupt regulatory activities, or have other adverse effects on our business and operations. In addition, this pandemic has caused substantial disruption in the financial markets and may adversely impact economies worldwide, both of which could result in adverse effects on our business and operations.

We will need additional funding before achieving potential profitability. If we are unable to raise capital when needed, we could be forced to delay, reduce, or eliminate our product development programs or commercialization efforts, engage in one or more potential transactions, or cease our operations entirely.

Increases in authorized shares will be required for future financings or other strategic transactions. We have experienced difficulties obtaining quorum for our annual meetings of stockholders and achieving the number of votes required for increases in authorized shares. If we continue to experience such difficulties, we will be limited in our efforts to raise additional capital, and our operations, financial condition and our ability to continue as a going concern may be materially and adversely affected.

We anticipate that we will continue to incur substantial losses for the foreseeable future and may never achieve or maintain profitability.

We are wholly dependent on the success of one product candidate, the Neuro-Spinal Scaffold implant. Even if we are able to complete clinical development and obtain favorable clinical results, we may not be able to obtain regulatory approval for, or successfully commercialize, our Neuro-Spinal Scaffold implant.

If we cannot protect, maintain and, if necessary, enforce our intellectual property rights, our ability to develop and commercialize products will be adversely impacted.

We will depend upon strategic relationships to develop and manufacture our products. If these relationships are not successful, we may not be able to capitalize on the market potential of these products.

Our success depends on our ability to retain our management and other key personnel.

We may face, and in the past have faced, lawsuits, which could divert management’s attention and harm our business.

The price of our common stock has been and may continue to be volatile, which could lead to losses by investors and costly securities litigation.

3

Table of Contents

PART I — FINANCIAL INFORMATION

Item 1.Financial Statements.

InVivo Therapeutics Holdings Corp.

Consolidated Balance Sheets

(In thousands, except share and per-share data)

(Unaudited)

As of

    

September 30, 

    

December 31, 

 

2021

2020

ASSETS:

    

    

Current assets:

Cash and cash equivalents

$

21,101

$

19,493

Prepaid expenses and other current assets

 

290

 

163

Total current assets

 

21,391

 

19,656

Property, equipment and leasehold improvements, net

 

77

 

85

Restricted cash - non-current

150

110

Operating lease right-of-use assets

833

928

Prepaid clinical trial expenses

 

1,122

 

1,122

Other assets

 

 

9

Total assets

$

23,573

$

21,910

LIABILITIES AND STOCKHOLDERS’ EQUITY:

Current liabilities:

Accounts payable

$

511

$

481

Operating lease liabilities

384

327

Accrued expenses

 

1,115

 

1,164

Total current liabilities

 

2,010

 

1,972

Other liabilities

89

59

Operating lease liabilities - non-current

530

693

Total liabilities

 

2,629

 

2,724

Commitments and contingencies (Note 5)

Stockholders’ equity:

Common stock, $0.00001 par value, authorized 50,000,000 shares; 34,264,806 shares issued and outstanding, including 6,302 shares of unvested restricted stock, at September 30, 2021; authorized 50,000,000 shares; 23,631,886 shares issued and outstanding, including 6,302 shares of unvested restricted stock, at December 31, 2020

 

3

 

3

Additional paid-in capital

 

256,158

 

247,417

Accumulated deficit

(235,217)

(228,234)

Total stockholders’ equity

 

20,944

 

19,186

Total liabilities and stockholders’ equity

$

23,573

$

21,910

See notes to the unaudited consolidated financial statements.

4

Table of Contents

InVivo Therapeutics Holdings Corp.

Consolidated Statements of Operations

(In thousands, except share and per-share data)

(Unaudited)

Three Months Ended

Nine Months Ended

September 30, 

September 30, 

    

2021

    

2020

    

2021

    

2020

    

Operating expenses:

    

    

    

    

Research and development

$

1,118

$

1,040

$

3,058

$

3,031

General and administrative

 

1,335

 

1,243

 

3,929

 

3,875

Total operating expenses

 

2,453

 

2,283

 

6,987

 

6,906

Operating loss

 

(2,453)

 

(2,283)

 

(6,987)

 

(6,906)

Other income:

Interest income

 

1

 

2

 

3

 

20

Other income

1

2

1

4

Other income

 

2

 

4

 

4

 

24

Net loss

$

(2,451)

$

(2,279)

$

(6,983)

$

(6,882)

Net loss per share, basic and diluted

$

(0.07)

$

(0.47)

$

(0.21)

$

(2.00)

Weighted average number of common shares outstanding, basic and diluted

 

34,258,504

 

4,875,534

 

32,681,055

 

3,440,419

See notes to the unaudited consolidated financial statements.

5

Table of Contents

InVivo Therapeutics Holdings Corp.

Consolidated Statements of Changes in Stockholders’ Equity

(In thousands, except share and per-share data)

(Unaudited)

Three Months Ended September 30, 2020

Additional

Total

Common Stock

Paid-in

Accumulated

Stockholders’

    

Shares

    

Amount    

    

Capital

    

Deficit

    

Equity 

Balance as of June 30, 2020

4,882,420

$

2

$

233,791

$

(223,763)

$

10,030

Share-based compensation expense

 

56

56

Net loss

 

(2,279)

(2,279)

Balance as of September 30, 2020

 

4,882,420

$

2

$

233,847

$

(226,042)

$

7,807

Three Months Ended September 30, 2021

Additional

Total

Common Stock

Paid-in

Accumulated

Stockholders’

    

Shares

    

Amount 

    

Capital    

    

 Deficit   

    

    Equity

Balance as of June 30, 2021

34,264,806

$

3

$

256,073

$

(232,766)

$

23,310

Share-based compensation expense

 

85

85

Net loss

 

(2,451)

(2,451)

Balance as of September 30, 2021

 

34,264,806

$

3

$

256,158

$

(235,217)

$

20,944

Nine Months Ended September 30, 2020

Additional

Total

Common Stock

Paid-in

Accumulated

Stockholders’

    

Shares

    

Amount

    

Capital

    

Deficit

    

Equity 

Balance as of December 31, 2019

550,736

$

2

$

224,741

$

(219,160)

$

5,583

Share-based compensation expense

 

171

171

Issuance of common stock upon vesting of restricted stock units

50

Fractional shares issued due to 1 for 30 reverse stock split

7,692

Issuance of common stock and warrants in public offering

2,670,853

8,592

8,592

Issuance of common stock upon exercise of warrants

1,653,089

343

343

Net loss

 

(6,882)

(6,882)

Balance as of September 30, 2020

 

4,882,420

$

2

$

233,847

$

(226,042)

$

7,807

Nine Months Ended September 30, 2021

Additional

Total

Common Stock

Paid-in

Accumulated

Stockholders’

    

Shares

    

Amount

    

Capital

    

 Deficit   

    

Equity     

Balance as of December 31, 2020

23,631,886

$

3

$

247,417

$

(228,234)

$

19,186

Share-based compensation expense

 

232

232

Issuance of common stock upon vesting of restricted stock units

50

Issuance of common stock upon exercise of warrants

 

10,632,870

8,509

8,509

Net loss

 

(6,983)

(6,983)

Balance as of September 30, 2021

 

34,264,806

$

3

$

256,158

$

(235,217)

$

20,944

See notes to the unaudited consolidated financial statements.

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InVivo Therapeutics Holdings Corp.

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

Nine Months Ended

September 30, 

    

2021

    

2020

 

Cash flows from operating activities:

    

    

Net loss

$

(6,983)

(6,882)

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

 

35

32

Amortization of operating lease right-of-use assets

239

211

Share-based compensation expense

 

232

171

Changes in operating assets and liabilities:

Prepaid expenses and other current assets

 

(127)

(106)

Accounts payable

 

30

(355)

Operating lease liability

(249)

(217)

Accrued expenses and other liabilities

 

(20)

(466)

Net cash used in operating activities

 

(6,843)

(7,612)

Cash flows from investing activities:

Purchases of property and equipment

(18)

(28)

Net cash used in investing activities

 

(18)

(28)

Cash flows from financing activities:

Proceeds from exercise of warrants

8,509

343

Proceeds from issuance of common stock and warrants, net of commissions and issuance costs

 

8,592

Net cash provided by financing activities

 

8,509

8,935

Increase in cash and cash equivalents and restricted cash

 

1,648

1,295

Cash, cash equivalents and restricted cash at beginning of period

 

19,603

6,716

Cash, cash equivalents and restricted cash at end of period

$

21,251

8,011

Supplemental disclosure of cash flow information and non-cash investing and financing activities:

Fair value of warrants issued in connection with financing activities

$

$

5,907

Increase in operating right-of-use assets and liabilities related to lease modifications

$

143

$

See notes to the unaudited consolidated financial statements.

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

1.

NATURE OF OPERATIONS AND GOING CONCERN, BASIS OF PRESENTATION AND RECENT ACCOUNTING PRONOUNCEMENTS

Business

InVivo Therapeutics Holdings Corp., including its subsidiary, (the “Company”) is a biomaterials and biotechnology company with a focus on the treatment of spinal cord injuries (“SCIs”). The Company’s proprietary technologies incorporate intellectual property that is licensed under an exclusive, worldwide license from Boston Children’s Hospital (“BCH”) and the Massachusetts Institute of Technology (“MIT”), as well as intellectual property that has been developed internally in collaboration with its advisors and partners.

Since its inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff, acquiring operating assets, and raising capital. The Company has historically financed its operations primarily through the sale of equity-related securities. As of September 30, 2021, the Company had unrestricted consolidated cash and cash equivalents of $21.1 million. Given the Company’s current plans, the Company estimates cash resources will be sufficient to fund its operations through the second quarter of 2023. The Company has not achieved profitability and may not be able to realize sufficient revenue to achieve or sustain profitability in the future. The Company does not expect to be profitable in the next several years, but rather expects to incur additional operating losses. The Company has limited liquidity and capital resources and must obtain significant additional capital resources in order to sustain its product development efforts, for acquisition of technologies and intellectual property rights, for preclinical and clinical testing of its anticipated products, pursuit of regulatory approvals, acquisition of capital equipment, laboratory and office facilities, establishment of production capabilities, for selling, general and administrative expenses, and other working capital requirements. The Company may raise capital through a combination of equity offerings, debt financings, other third-party funding, marketing and distribution arrangements, and other collaborations, strategic alliances, and licensing arrangements. The Company believes that it can be successful in obtaining additional capital; however, no assurance can be provided that it will be able to do so. There is no assurance, moreover, that any funds raised will be sufficient to enable the Company to attain profitable operations or continue as a going concern.

As a result of the COVID-19 pandemic, a significant number of the Company’s clinical sites temporarily suspended enrollment into the INSPIRE 2.0 Study at their institution in 2020. As such, the COVID-19 pandemic did affect and may continue to affect the potential for enrollment in the Company’s INSPIRE 2.0 Study in the event that clinical sites may again suspend our study in the future in order to manage the pandemic. Aside from the impact on enrollment in the Company’s INSPIRE 2.0 Study, the Company did not experience any significant impact from the COVID-19 pandemic on its financial condition, liquidity, other operations, suppliers, industry, and workforce during the three and nine months ended September 30, 2021. As of November 2, 2021, the Company has 17 clinical sites open for enrollment in the INSPIRE 2.0 Study, which is the total number of sites it currently has activated for the INSPIRE 2.0 Study. The full impact of the COVID-19 pandemic continues to evolve as of the date of filing this Quarterly Report on Form 10-Q and the Company cannot be certain what future impact the COVID-19 pandemic may have on its clinical sites and their respective abilities to enroll patients. As the pandemic continues to evolve, there may be additional government actions or disruptions that could cause the Company’s clinical sites to suspend or alter operations in a manner that would impact enrollment of the INSPIRE 2.0 Study. The Company is actively monitoring the impact of the global situation on its financial condition, liquidity, operations, suppliers, industry, and workforce, as there remains significant uncertainty related to the COVID-19 pandemic globally. Given the evolution of the COVID-19 pandemic and the global responses to curb its spread, the Company is not able to estimate the ultimate effects of the COVID-19 pandemic on its future results of operations, financial condition, or liquidity in the future. However, as the COVID-19 pandemic continues, it may continue to have an adverse effect on enrollment in the Company’s INSPIRE 2.0 Study and may also have an adverse effect on the Company’s results of future operations, financial position, and liquidity, and even after the COVID-19 pandemic has subsided, the Company may continue to experience adverse impacts to its business as a result of any economic recession or depression that has occurred or may occur in the future.

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

Going Concern

The Company’s consolidated financial statements as of September 30, 2021 were prepared under the assumption that the Company will continue as a going concern. As of September 30, 2021, the Company had unrestricted cash and cash equivalents of $21.1 million. Given the Company’s current development plans, the Company estimates cash resources will be sufficient to fund its operations, through the second quarter of 2023.

The Company’s ability to continue as a going concern depends on its ability to obtain additional equity or debt financing, attain further operating efficiencies, manage expenditures, and, ultimately, to generate revenue. If the Company is unable to continue as a going concern, it may have to liquidate its assets and may receive less than the value at which those assets are carried on its audited financial statements, and it is likely that investors will lose all or part of their investment.

Reverse Stock Split

On February 11, 2020, the Company effected a reverse stock split of its common stock, par value $0.00001 per share, at a ratio of 1-for-30 (the “2020 Reverse Stock Split”). As a result of the 2020 Reverse Stock Split, (i) every 30 shares of the issued and outstanding common stock were automatically converted into one newly issued and outstanding share of common stock, without any change in the par value per share; (ii) the number of shares of common stock into which each outstanding warrant or option to purchase common stock is exercisable was proportionally decreased, and (iii) the number of authorized shares of common stock outstanding was proportionally decreased. Shares of common stock underlying outstanding stock options and other equity instruments convertible into common stock were proportionately reduced and the respective exercise prices, if applicable, were proportionately increased in accordance with the terms of the agreements governing such securities.

All of the Company’s historical share and per share information related to issued and outstanding common stock and outstanding options and warrants exercisable for common stock in these consolidated financial statements were adjusted, on a retroactive basis to reflect the 2020 Reverse Stock Split.

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) consistent with those applied in, and should be read in conjunction with, the Company’s audited consolidated financial statements and related footnotes for the year ended December 31, 2020 included in the Company’s Annual Report on Form 10-K as filed with the United States Securities and Exchange Commission (“SEC”) on March 1, 2021. The unaudited consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the Company’s financial position as of September 30, 2021 and its results of operations and cash flows for the interim periods presented, and are not necessarily indicative of results for subsequent interim periods or for the full year. The interim consolidated financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements, as allowed by the relevant SEC rules and regulations; however, the Company believes that its disclosures are adequate to ensure that the information presented is not misleading.

New Accounting Pronouncements Not Yet Adopted

In May 2021 the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options, a consensus of the Emerging Issues Task Force, which amends the FASB Accounting Standards Codification (“ASC”) to provide explicit guidance, and, thus, reduce diversity in practice, on accounting

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

by issuers for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after the modification or exchange. This amendment provides that for an entity that presents earnings per share (EPS) in accordance with Topic 260, the effects of a modification or an exchange of a freestanding equity-classified written call option that is recognized as a dividend should be an adjustment to net income (or net loss) in the basic EPS calculation. The amended guidance becomes mandatorily effective for all entities for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years, and should be applied prospectively to modifications or exchanges occurring on or after the effective date. The Company will adopt ASU 2021-04 effective January 1, 2022, and it is expected that the adoption will not have a material impact to the Company's Condensed Consolidated Financial Statements.

No other accounting standards known by the Company to be applicable to it that have been issued by the FASB or other standard-setting bodies and that do not require adoption until a future date are expected to have a material impact on the Company’s consolidated financial statements upon adoption.

2.

CASH AND CASH EQUIVALENTS

The Company considers only those investments that are highly liquid, readily convertible to cash, and that mature within three months from date of purchase to be cash equivalents. From time to time, the Company may have cash balances in financial institutions in excess of insurance limits. The Company has not experienced any losses related to these balances. Management believes it is not exposed to significant credit risk.

Cash and cash equivalents consisted of the following:

September 30, 

December 31, 

(In thousands)

    

2021

    

2020

 

Cash

$

(34)

$

(13)

Money market funds

 

21,135

 

19,506

Total cash and cash equivalents

$

21,101

$

19,493

3.

RESTRICTED CASH

Restricted cash as of September 30, 2021 and December 31, 2020 was $150 thousand and $110 thousand, respectively. Restricted cash as of September 30, 2021 included a $50 thousand security deposit related to the Company’s credit card account and a $100 thousand standby letter of credit in favor of a landlord (see Note 5). Restricted cash as of December 31, 2020 included a $50 thousand security deposit related to the Company’s credit card account and a $60 thousand standby letter of credit in favor of a landlord.

4.

FAIR VALUES OF ASSETS AND LIABILITIES

The Company groups its assets and liabilities generally measured at fair value into three levels based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value.

Level 1 — Valuation is based on quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities generally include debt and equity securities that are traded in an active exchange market. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities.

Level 2 — Valuation is based on observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 — Valuation is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

Assets and liabilities measured at fair value on a recurring basis are summarized below:

As of September 30, 2021

(In thousands)

    

Level 1

    

Level 2

    

Level 3

    

Fair Value

Cash equivalents

$

21,135

$

$

$

21,135

As of December 31, 2020

(In thousands)

    

Level 1

    

Level 2

    

Level 3

    

Fair Value

Cash equivalents

$

19,506

$

$

$

19,506

During the three and nine months ended September 30, 2021 and 2020, there were no transfers between levels. The fair value of the Company’s cash equivalents, consisting of a money market fund, is based on quoted market prices in active markets with no valuation adjustment.

The Company believes the carrying amounts of its prepaid expenses and other current assets, restricted cash, accounts payable and accrued expenses approximate their fair value due to the short-term nature of these amounts.

5.

COMMITMENTS AND CONTINGENCIES

Operating Leases

On May 3, 2018, the Company entered into a sublease for 5,104 square feet of space for its corporate offices and laboratory space in Cambridge, Massachusetts (the “Cambridge Sublease”). The Cambridge Sublease commenced on May 3, 2018 and was scheduled to expire October 31, 2023. In May 2021, the Company entered into an agreement to terminate the Cambridge Sublease (the “Sublease Termination”). In connection with the Sublease Termination, the $60 thousand standby letter of credit was cancelled and returned to the Company.

Concurrent with the Sublease Termination, the Company entered into a new lease for the same space with ARE-MA (the “Cambridge Lease”). The Cambridge Lease commenced on June 1, 2021 and is scheduled to expire on December 31, 2023. The Cambridge Lease contains rent escalation clauses. In connection with the Cambridge Lease, a new standby letter of credit was established for $100 thousand. Under the Cambridge Lease, the Company will be required to pay its proportionate share of certain operating costs and property taxes applicable to the leased premises in excess of new base year amounts. These costs are considered to be variable lease payments and are not included in the determination of the lease’s right-of-use asset or lease liability.

The Sublease Termination and concurrent execution of the Cambridge Lease was determined to be a lease modification that qualified as a change of accounting on the existing lease and not a separate contract. As such, the right-of-use assets and operating lease liabilities were remeasured using an incremental borrowing rate at the date of modification of 5.74%, which resulted in an increase of $143 thousand in both the right-of-use asset and operating lease liabilities.

The Company identified and assessed the following significant assumptions in recognizing its right-of-use assets and corresponding lease liabilities:

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

As the Cambridge Lease does not provide an implicit rate, the Company estimated the incremental borrowing rate in calculating the present value of the lease payments.
Since the Company elected to account for each lease component and its associated non-lease components as a single combined component, all contract consideration was allocated to the combined lease component.
The expected lease terms include noncancelable lease periods.

The elements of lease expense are as follows:

Three Months Ended September 30, 

Nine Months Ended September 30, 

Lease cost (In thousands)

2021

  

2020

  

2021

  

2020

Operating lease cost

$

99

$

91

$

284

$

273

Short-term lease cost

2

4

15

Variable lease cost

24

32

83

108

Total lease cost

$

123

$

125

$

371

$

396

Other information (In thousands)

Increase in operating right-of-use assets and liabilities related to lease modifications

$

$

$

143

$

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from short term leases

$

$

2

$

4

$

15

Operating cash flows from operating leases

103

93

297

279

Total cash paid for leases

$

103

$

95

$

301

$

294

Weighted-average remaining lease term - operating leases

2.25 Years

3.1 Years

2.25 Years

3.1 Years

Weighted-average discount rate - operating leases

5.7%

7.0%

5.7%

7.0%

Maturities of the lease liability due under the Cambridge Lease as of September 30, 2021 are as follows:

Leases (In thousands)

As of September 30, 2021

    

2021 (excluding the nine months ended September 30, 2021)

$

105

2022

427

2023

440

Total lease payments

972

Less: imputed interest

(58)

Present value of lease liabilities

$

914

Right-of-use lease assets and lease liabilities are reported in the Company’s consolidated balance sheets as follows:

Leases (In thousands)

Classification

    

September 30, 2021

December 31, 2020

Assets

Lease asset, net

Operating

$

833

$

928

Total lease assets

$

833

$

928

Liabilities

Current

Operating

$

384

$

327

Non-current

Operating

530

693

Total lease liabilities

$

914

$

1,020

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

Clinical Trial Commitments

The Company has engaged and executed contracts with clinical research organizations (“CROs”) to assist with the administration of its ongoing INSPIRE 1.0 and INSPIRE 2.0 clinical trials. As of September 30, 2021, approximately $3.4 million remains to be paid on these contracts. The timelines and related costs necessary to complete these trials may vary depending on a number of factors including the rate of patient enrollment into our INSPIRE 2.0 trial. In the event the Company were to terminate the INSPIRE 2.0 trial, certain financial penalties would become payable to the CROs for costs to wind down the terminated trial.

6.        FIXED ASSETS

Property, equipment, and leasehold improvements, net consisted of the following:

September 30, 

December 31, 

(In thousands)

    

2021

    

2020

 

Computer software and hardware

$

40

$

40

Research and lab equipment

 

538

 

520

Leasehold improvements

 

66

 

66

Property and equipment

644

626

Less accumulated depreciation

 

(567)

 

(541)

Property and equipment, net

$

77

$

85

Depreciation expense for the three and nine months ended September 30, 2021 was $9 thousand and $26 thousand, respectively. Depreciation expense for the three and nine months ended September 30, 2020, was $5 thousand and $19 thousand, respectively. Maintenance and repairs are charged to expense as incurred and any additions or improvements are capitalized.

7.        INTANGIBLE ASSETS

Intangible assets, included in “other assets,” consisted of patent licensing fees paid to license intellectual property. In July 2007, the Company entered into a worldwide exclusive license (the “BCH License”) for patents co-owned by BCH and MIT initially covering the use of biopolymers to treat spinal cord injuries, and to promote the survival and proliferation of human stem cells in the spinal cord. During 2011, the BCH License was amended, and the Company obtained additional rights for use in the field of peripheral nerve injuries. The BCH License, as amended, has a 15 year term, or as long as the life of the last expiring patent right thereunder, whichever is longer, unless terminated earlier by the licensor, under certain conditions as defined in the related license agreement. In connection with the BCH License, the Company paid an initial $75 thousand licensing fee and is required to pay certain annual maintenance fees, milestone payments and royalties. License fees are capitalized and the gross total as of September 30, 2021 and December 31, 2020 was $200 thousand. The Company accounts for milestone payments, maintenance fees and royalties when they become due and payable. During the three and nine months ended September 30, 2021 and 2020, the Company did not pay any milestone payments. The Company is amortizing the license fee as a research and development expense over the 15 year term of the license. As of September 30, 2021 the license fee had been fully amortized.

Intangible assets, net consisted of the following:

September 30, 

December 31, 

(In thousands)

    

2021

    

2020

 

Patent licensing fee

$

200

$

200

Accumulated amortization

 

(200)

 

(191)

Other assets

$

$

9

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

The Company did not record any amortization expense during the three months ended September 30, 2021 as the license fee was fully amortized during the previous quarter. Amortization expense during the nine months ended September 30, 2021 was $9 thousand. Amortization expense during the three and nine months ended September 30, 2020, was $4 thousand and $13 thousand, respectively.

8.       ACCRUED EXPENSES

Accrued expenses consisted of the following:

September 30, 

December 31, 

(In thousands)

    

2021

    

2020

 

Compensation

$

732

$

996

Clinical

 

191

5

Legal

22

17

Other accrued expenses

 

170

146

Total accrued expenses

$

1,115

$

1,164

9.

EMPLOYEE BENEFIT PLAN

In November 2006, the Company adopted a 401(k) plan (the “Plan”) covering all employees. Employees must be 21 years of age in order to participate in the Plan. Under the Plan, the Company has the option to make matching contributions. During the three months ended September 30, 2021 and 2020, the Company contributed $18 thousand and $16 thousand, respectively, in cash as a matching contribution to employee 401(k) accounts which is included in the accrued expenses balances on the balance sheet. During the nine months ended September 30, 2021 and 2020, the Company contributed $59 thousand and $51 thousand respectively, in cash as a matching contribution to employee 401(k) accounts which is included in the accrued expenses balances on the balance sheet.

10.

COMMON STOCK

On January 21, 2020, the Company held its 2019 Annual Meeting of Stockholders (the “2019 Annual Meeting”). At the 2019 Annual Meeting, the Company’s stockholders approved an amendment to the Company’s Articles of Incorporation to increase the number of shares of authorized common stock from 25,000,000 to 500,000,000 (without giving effect to the 2020 Reverse Stock Split). On February 11, 2020, the Company effected the 2020 Reverse Stock Split and the number of shares of authorized common stock was reduced to 16,666,667. On August 4, 2020, the Company held its 2020 Annual Meeting of Stockholders (the “2020 Annual Meeting”). At the 2020 Annual Meeting, the Company’s stockholders approved an amendment to the Company’s Articles of Incorporation to increase the number of shares of authorized common stock from 16,666,667 to 50,000,000 shares. As of September 30, 2021, and December 31, 2020, 34,264,806 and 23,631,886 shares were issued and outstanding, respectively.

In October 2020, the Company completed a registered public offering (the “October 2020 Offering”) in which it sold an aggregate of (i) 11,785,000 shares of common stock, (the “October 2020 Shares”) and Series A Warrants exercisable for an aggregate of 11,785,000 shares of the Company’s common stock (the “October 2020 Series A Warrants”) at a combined public offering price of $0.80 per share and associated warrant and (ii) pre-funded Series B warrants exercisable for an aggregate of 6,965,000 shares of common stock (the “October 2020 Series B Pre-funded Warrants”) and Series A Warrants exercisable for an aggregate of 6,965,000 shares of the Company’s common stock (also the “October 2020 Series A Warrants”) at a combined public offering price of $0.80 per pre-funded warrant and associated warrant. Each October 2020 Series A Warrant has an exercise price of $0.80 per share, is exercisable immediately and expires in October 2025. Each October 2020 Series B Pre-funded Warrant has an exercise price of $0.00001 per share, is exercisable immediately, and expires when exercised in full, subject to certain conditions. In connection with the October 2020 Offering, the Company issued, to designees of H.C. Wainwright & Co., LLC (“Wainwright”) the placement agent for the October 2020 Offering, warrants (the “October 2020 Placement Agent Warrants”) to purchase an aggregate of 1,218,750 shares of the Company’s

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

common stock, which represents a number of shares of common stock equal to 6.5% of the aggregate number of shares of common stock and October 2020 Series B Pre-funded Warrants sold in the October 2020 Offering. The October 2020 Placement Agent Warrants have an exercise price of $1.00 per share, are immediately exercisable and expire in October 2025. The net proceeds to the Company, after deducting Wainwright's placement agent fees and other offering expenses payable by the Company, were approximately $13.5 million. The Company assessed whether the October 2020 Series A Warrants, October 2020 Series B Pre-funded Warrants and the October 2020 Placement Agent Warrants required accounting as derivatives and determined that they were (1) indexed to the Company’s own stock and (2) classified in stockholders’ equity in accordance with ASC Topic 815, Derivatives and Hedging. As such, the Company concluded that the October 2020 Series A Warrants, October 2020 Series B Pre-funded Warrants and the October 2020 Placement Agent Warrants meet the scope exception for determining whether the instruments require accounting as derivatives and accordingly are classified in stockholders’ equity. The fair value of the October 2020 Series A Warrants and October 2020 Placement Agent Warrants was estimated at $8.7 million and $551.3 thousand, respectively, using a Black-Scholes model with the following assumptions: expected volatility of 119.13%, risk free interest rate of 0.35%, expected life of five years and no dividends. The October 2020 Series B Pre-funded Warrants had an intrinsic value of approximately $5.6 million. There are no outstanding October 2020 Series B Pre-funded Warrants as of as of September 30, 2021. The Company did not issue any shares as a result of either the October 2020 Series A Warrants or the October 2020 Placement Agent Warrants exercise activity during the three months ended September 30, 2021. During the nine months ended September 30, 2021, the Company issued an aggregate of 10,620,682 and 12,188 shares of common stock upon the exercise of certain of the October 2020 Series A Warrants and October 2020 Placement Agent Warrants, respectively, for aggregate proceeds of $8.5 million.

In April 2020, the Company entered into a securities purchase agreement (the "April 2020 Purchase Agreement") with certain institutional investors (the "April 2020 Purchasers"), pursuant to which the Company agreed to sell and issue, in a registered direct offering, an aggregate of 1,715,240 of common stock, at a purchase price per share of $1.75 (the "April 2020 Shares"; the offering, the “April 2020 Registered Offering”). The April 2020 Shares were offered by the Company pursuant to a shelf registration statement on Form S-3, which was declared effective by the SEC on November 14, 2019 (File No. 333-234353) and a prospectus supplement thereunder. Pursuant to the April 2020 Purchase Agreement, in a concurrent private placement, the Company also issued to the April 2020 Purchasers warrants (the "April 2020 Series C Warrants") to purchase up to 1,715,240 shares of common stock (the "Private Placement" and together with the April 2020 Registered Offering, the "April 2020 Offerings"). The April 2020 Series C Warrants are exercisable immediately at an exercise price of $1.62 per share of common stock, subject to adjustment in certain circumstances, and expire on October 17, 2025. In connection with the April 2020 Offerings, the Company also issued to Wainwright, warrants to purchase an aggregate of 111,491 shares of the Company’s common stock (“April 2020 Placement Agent Warrants”) which represents a number of shares of common stock equal to 6.5% of the aggregate number of April 2020 Shares sold in the April 2020 Registered Offering, at an exercise price of $2.1875 per share with a term expiring on April 15, 2025. The net proceeds to the Company, after deducting Wainwright's placement agent fees and other offering expenses payable by the Company, were approximately $2.6 million. The Company assessed whether the April 2020 Series C Warrants, and the April 2020 Placement Agent Warrants required accounting as derivatives and determined that they were (1) indexed to the Company’s own stock and (2) classified in stockholders’ equity in accordance with ASC Topic 815, Derivatives and Hedging. As such, the Company concluded that the April 2020 Series C Warrants and the April 2020 Placement Agent Warrants meet the scope exception for determining whether the instruments require accounting as derivatives and accordingly are classified in stockholders’ equity. The fair value of the April 2020 Series C Warrants was estimated at $2.1 million, using a Black-Scholes model with the following assumptions: expected volatility of 115.84%, risk free interest rate of 0.40%, expected life of five and a half years and no dividends. The fair value of the April 2020 Placement Agent Warrants was estimated at $128 thousand, using a Black-Scholes model with the following assumptions: expected volatility of 116.14%, risk free interest rate of 0.36%, expected life of five years and no dividends. The Company did not issue any shares as a result of either the April 2020 Series C Warrants or April 2020 Placement Agent Warrants exercise activity during the three and nine months ended September 30, 2021. The Company did not issue any shares as a result of April 2020 Series C Warrant exercise activity during the three months ended September 30, 2020. During the nine months ended

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

September 30, 2020, the Company issued an aggregate of 35,000 shares of common stock upon the exercise of certain of the April 2020 Series C Warrants for aggregate proceeds of $57 thousand.

In March 2020, the Company completed a registered public offering (the “March 2020 Offering”) in which it sold an aggregate of (i) 955,613 shares of common stock (the “March 2020 Shares”) and Series A Warrants exercisable for an aggregate of 955,613 shares of the Company’s common stock (the “March 2020 Series A Warrants”) at a combined public offering price of $2.75 per share and associated warrant and (ii) pre-funded Series B warrants exercisable for an aggregate of 1,589,842 shares of common stock (the “March 2020 Series B Warrants”) and Series A Warrants exercisable for an aggregate of 1,589,842 shares of the Company’s common stock (also the “March 2020 Series A Warrants”) at a combined public offering price of $2.75 per pre-funded warrant and associated warrant. Each March 2020 Series A Warrant has an exercise price of $2.75 per share, is exercisable immediately and expires in March 2025. Each March 2020 Series B Warrant has an exercise price of $0.00001 per share, is exercisable immediately, and expires when exercised in full, subject to certain conditions. In connection with the March 2020 Offering, the Company issued, to Wainwright the placement agent for the March 2020 Offering, warrants to purchase an aggregate of 165,455 shares of the Company’s common stock (the “March 2020 Placement Agent Warrants”), which represents a number of shares of common stock equal to 6.5% of the aggregate number of shares of common stock and March 2020 Series B Warrants sold in the March 2020 Offering. The March 2020 Placement Agent Warrants have an exercise price of $3.4375 per share, are immediately exercisable and expire in March 2025. The net proceeds to the Company, after deducting Wainwright's placement agent fees and other offering expenses payable by the Company, were approximately $6.0 million. The Company assessed whether the March 2020 Series A Warrants, March 2020 Series B Warrants and the March 2020 Placement Agent Warrants required accounting as derivatives and determined that they were (1) indexed to the Company’s own stock and (2) classified in stockholders’ equity in accordance with ASC Topic 815, Derivatives and Hedging. As such, the Company concluded that the March 2020 Series A Warrants, March 2020 Series B Warrants and the March 2020 Placement Agent Warrants meet the scope exception for determining whether the instruments require accounting as derivatives and accordingly are classified in stockholders’ equity. The fair value of the March 2020 Series A warrants and March 2020 Placement Agent Warrants was estimated at $3.5 million and $218 thousand, respectively, using a Black-Scholes model with the following assumptions: expected volatility of 115.22%, risk free interest rate of 0.63%, expected life of five years and no dividends. The March 2020 Series B Warrants had an intrinsic value of approximately $4.4 million. The Company did not issue any shares as a result of either the March 2020 Series A Warrant, March 2020 Series B Warrants or March 2020 Placement Agent Warrants exercise activity during the three and nine months ended September 30, 2021. The Company did not issue any shares as a result of either the March 2020 Series A Warrant, March 2020 Series B Warrants or March 2020 Placement Agent Warrants exercise activity during the three months ended September 30, 2020. The Company did not issue any shares as a result of either the March 2020 Series A Warrant or March 2020 Placement Agent Warrants during the nine months ended September 30, 2020. During the nine months ended September 30, 2020, the Company issued an aggregate of 1,577,114 shares of common stock upon the exercise of the March 2020 Series B warrants for an immaterial amount as they were substantially pre-funded.

During the three and nine months ended September 30, 2021, there was no exercise activity related to any of the warrants that were issued in 2018 and 2019. During the three months ended September 30, 2020 there was no exercise activity related to any of the warrants that were issued in 2018 and 2019. During the nine months ended September 30, 2020, the Company issued an aggregate of 40,975 shares of common stock upon the exercise of certain warrants issued in 2018 for aggregate proceeds of $286 thousand.

During the nine months ended September 30, 2020, as part of the adjustment to reflect the 2020 Reverse Stock Split, the Company issued an aggregate of 7,692 shares of common stock to account for the fractional roundup of shareholders.

The Company did not issue any shares as a result of the vesting of restricted stock units during the three months ended September 30, 2021. During nine months ended September 30, 2021 the Company issued an aggregate of 50 shares of common stock upon vesting of restricted stock units. The Company did not issue any shares as a result of the vesting of restricted stock units during of the three months ended September 30, 2020. During the nine

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

months ended September 30, 2020, the Company issued an aggregate of 50 shares of common stock upon vesting of restricted stock units.

11.

STOCK-BASED COMPENSATION

On October 26, 2010, the Company’s Board of Directors adopted, and the Company’s shareholders subsequently approved, the 2010 Equity Incentive Plan (as subsequently amended, the “2010 Plan”). The 2010 Plan provided for grants of incentive stock options to employees, and nonqualified stock options and restricted common stock to employees, consultants, and non-employee directors of the Company.

In April 2015, the Company’s Board of Directors adopted, and the Company’s shareholders subsequently approved, the 2015 Equity Incentive Plan (the “2015 Plan”). The 2015 Plan provides for grants of incentive stock options to employees, and nonqualified stock options, restricted common stock, restricted stock units (“RSUs”), and stock appreciation rights to employees, consultants, and non-employee directors of the Company.

As of September 30, 2021, the total number of shares authorized for issuance under the 2015 Plan was 2,767,419 shares, consisting of (i) 5,333 shares initially authorized under the 2015 Plan shares, (ii) the shares that remained available for grant under the 2010 Plan at the time of its termination adjusted for cumulative cancellations, forfeitures and issuances from the 2010 Plan and 2015 Plan, (iii) the 26,667 shares approved for increase during the January 2020 shareholders meeting (iv) the 400,000 shares approved for increase during the 2020 Annual Meeting and, the 2,700,000 shares approved for increase during the Company’s 2021 Annual Meeting of Stockholders. While 2,767,419 shares are authorized for issuance under the 2015 Plan as of September 30, 2021, only 1,292,784 shares can be issued under the 2015 Plan due to restrictions on the usage of the 2015 Plan resulting from the total number of shares of common stock authorized under the Company’s certificate of incorporation.

Options issued under the 2010 Plan, and 2015 Plan (collectively, the “Plans”) are exercisable for up to 10 years from the date of issuance.

Stock-based compensation

For the three and nine month periods ended September 30, 2021 and 2020, stock-based compensation recognized was classified in the consolidated statements of operations as follows:

Three Months Ended September 30, 

Nine Months Ended September 30, 

(In thousands)

2021

2020

2021

2020

Research and development

$

6

$

12

$

15

$

39

General and administrative

79

44

217

132

Total

$

85

$

56

$

232

$

171

The fair value of each option award is estimated on the date of grant using the Black‑Scholes option pricing model, which uses the following assumptions; (i) Risk-free interest rate, (ii) Expected dividend yield, (iii) Expected term and (iv) Expected volatility. The Company uses historical data, as well as subsequent events occurring prior to the issuance of the financial statements, to estimate option exercises within the valuation model. The expected term of options granted under the Plans, all of which qualify as “plain vanilla,” is based on the average of the contractual term (10 years) and the vesting period (generally, 48 months). For non‑employee options, the expected term is the contractual term. The risk‑free rate is based on the yield of a U.S. Treasury security with a term consistent with the option. The impact of forfeitures on compensation expense is recorded as they occur.

The Company grants RSUs and restricted stock awards (“RSAs”), collectively referred to as restricted securities under the 2015 Equity Incentive Plan. These restricted securities generally vest over a three-year period, contingent on the recipient’s continued employment. Prior to vesting, all RSAs have the right to vote and receive

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

dividends under the 2015 Equity Incentive Plan; however, the Company’s form of Restricted Stock Agreement provides that the payment of dividends on unvested RSAs shall be deferred until such time as the shares vest. The grant date fair value of these awards is based on the fair market value of our common stock on the date of grant.

The Company did not grant any awards during the three and nine months ended September 30, 2020. The Company did not grant any awards during the three months ended September 30, 2021. The assumptions used principally in determining the fair value of options granted during the nine months ended September 30, 2021 were as follows:

September 30, 

 

    

2021

 

Risk-free interest rate

    

1.03%

Expected dividend yield

 

0%

Expected term (employee grants)

 

5.70

Expected volatility

 

117.34%

Stock options

A summary of option activity as of September 30, 2021 and changes for the nine month period then ended are presented below:

Weighted

Weighted

Average

Average

Remaining

Aggregate

Exercise

Contractual

Intrinsic

Options

    

Shares

    

Price

    

Term in Years

Value

Outstanding as of December 31, 2020

 

4,169

$

1,054.01

 

7.18

$

Granted

 

360,000

$

1.10

Cancelled/Forfeited

(147)

$

6,324.03

Outstanding as of September 30, 2021

 

364,022

$

10.61

9.43

$

Vested and Exercisable as of September 30, 2021

 

3,022

$

1,131.24

6.39

$

Vested and expected to vest as of September 30, 2021

 

364,022

$

10.61

 

9.43

$

The weighted-average grant-date fair value of stock options granted during the nine months ended September 30, 2021 was $0.93. The total fair value of options that vested in the three and nine months ended September 30, 2021 was $4 thousand and $67 thousand, respectively. The total fair value of options that vested in the three and nine months ended September 30, 2020 was $24 thousand and $104 thousand, respectively.

During the three and nine months ended September 30, 2021, the Company recorded stock-based compensation expense of $60 thousand and $158 thousand, respectively, related to stock options. During the three and nine months ended September 30, 2020, the Company recorded stock-based compensation expense of $31 thousand and $95 thousand, respectively, related to stock options. As of September 30, 2021, total unrecognized compensation expense related to non-vested share-based option compensation arrangements amounted to $236 thousand and is estimated to be recognized over a period of 1.27 years.

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InVivo Therapeutics Holdings Corp.

Notes to Consolidated Financial Statements for the Quarter Ended September 30, 2021 (Unaudited)

(Continued)

Restricted Securities

The following table summarizes the restricted securities activity under the 2015 Plan during the nine month period ended September 30, 2021:

Weighted-Average

Restricted Securities

    

Number of Grants

    

Grant Date Fair Value

Unvested balance as of December 31, 2020

6,402

$

25.67

Vested

(50)

$

660.00

Unvested balance as of September 30, 2021

6,352

$

20.67

During the three and nine months ended September 30, 2021, the Company recorded stock-based compensation expense of $25 thousand and $74 thousand, respectively, related to the time-based restricted securities. During the three and nine months ended September 30, 2020, the Company recorded stock-based compensation expense of $26 thousand and $76 thousand, respectively, related to the time-based restricted securities. As of September 30, 2021, total unrecognized compensation expense related to non-vested restricted securities amounted to $46 thousand which the Company expects to recognize over a remaining weighted-average of 0.75 year. All the restricted securities that remain unvested and outstanding as of September 30, 2021 are subject to time-based vesting.

12.     WARRANTS

The following table presents information about warrants to purchase common stock issued and outstanding as of September 30, 2021:

    

    

    

Number of

    

Exercise Price as of

    

Year Issued

Defined Name

Classification

Warrants

September 30, 2021

Date of Expiration

2018

2018 Series A Warrants

Equity

211,921

$

6.98

6/25/2023

2019

2019 Placement Agent Warrants

Equity

15,168

$

4.50

11/21/2024

2020

March 2020 Series A Warrants

Equity

2,545,455

$

2.75

3/10/2025

2020

March 2020 Placement Agent Warrants

Equity

165,455

$

3.4375

3/5/2025

2020

March 2020 Series B Warrants

Equity

12,728

$

0.00001

Until Fully Exercised

2020

April 2020 Series C Warrants

Equity

1,680,240

$

1.62

10/17/2025

2020

April 2020 Placement Agent Warrants

Equity

111,491

$

2.1875

4/15/2025

2020

October 2020 Placement Agent Warrants

Equity

1,206,562

$

1.00

10/22/2025

2020

October 2020 Series A Warrants

Equity

8,129,318

$

0.80

10/27/2025

Total

 

14,078,338