If we fail to obtain substantial funding or consummate a strategic transaction in the next
several months and are unable to continue as a going concern, we may be required to discontinue or delay one or more of our development programs or to wind-down our business through the initiation of bankruptcy proceedings. In the event of a
wind-down, it is likely that holders of our Class A Common Stock, including investors in this offering, will lose all or part of their investment. If we seek additional financing to fund our business activities in the future and there is
substantial doubt about our ability to continue as a going concern, investors or other financing sources may be unwilling to provide additional funding to us on commercially reasonable terms or at all.
You may experience future dilution as a result of future equity offerings.
Sales of shares of our Class A Common Stock result in dilution to our stockholders. In order to raise additional capital, we expect to
offer additional shares of Class A Common Stock or other securities convertible into or exchangeable for Class A Common Stock, including sales of Class A Common Stock pursuant to a sales agreement between the Company and Stifel,
Nicolaus & Company, Incorporated (“Stifel”), pursuant to which we may, from time to time, sell shares of our Class A Common Stock having an aggregate offering price of up to $80,000,000 through Stifel, as the Company’s
sales agent, in an at-the-market offering (the “ATM Facility”), under which approximately $73.5 million of availability remained at March 31, 2024.
In addition to sales of Class A Common Stock made pursuant to the ATM Facility, we expect in the future to seek to raise additional
equity financing, including through the offer of additional shares of Class A Common Stock or other securities convertible into or exchangeable for Class A Common Stock. Moreover, such additional equity offerings may occur in the near term
following this offering.
We cannot assure you that we will be able to sell shares or other securities in any other offering at a price
per share that is equal to or greater than the price paid by investors in this offering for a share of Class A Common Stock and accompanying Common Warrant and investors purchasing shares or other securities in the future could have rights
superior to existing stockholders. The price per share at which we sell additional shares of Class A Common Stock or other securities convertible into or exchangeable for Class A Common Stock in future transactions may be higher or lower
than the price per share of Class A Common Stock and accompanying Common Warrant in this offering.
Furthermore, if outstanding
options or warrants, including the Common Warrants issued in this offering, are exercised, you could experience further dilution. As of March 31, 2024, approximately 5,543,635 shares of Class A Common Stock are either issuable upon
conversion of shares of Class B Common Stock, issuable upon exercise of outstanding options, issuable upon vesting and settlement of outstanding restricted stock units, issuable upon exercise of the 2022 Common Warrants, issuable upon exercise
of the Pre-Funded Warrants or reserved for future issuance under the Plan and are eligible for sale in the public market to the extent permitted by the provisions of various vesting schedules.
If our large stockholders sell a substantial number of shares of Class A Common Stock in either the private or public markets, the market
price of the Class A Common Stock could decrease materially. The perception in the public market that these stockholders might sell Class A Common Stock could also depress the market price of the Class A Common Stock and could impair
our future ability to obtain capital, especially through an offering of equity securities.
Additionally, shares of Class A Common
Stock issued or issuable under our equity incentive plans to employees and directors have been registered on Form S-8 registration statements and may be freely sold in the public market upon issuance.
The Common Warrants are speculative in nature.
The Common Warrants, which have an initial exercise price of $10.00 per share of Class A Common Stock, except that the Common Warrants
issued to an executive officer have an initial exercise price of $10.07 per share, in each case subject to adjustments, are exercisable beginning on the issuance date for a period of five years from the date such Common Warrants are first
exercisable. If the price of the Class A Common Stock does not increase to an amount sufficiently above the exercise price of the Common Warrants during the period during which the Common Warrants are exercisable, you will be unable to recover
any of your investment in the Common Warrants. In such event, the Common Warrants will not have any value.
There can be no assurance that
the market price of the Class A Common Stock will ever equal or exceed the exercise price of the Common Warrants, and consequently, whether it will ever be profitable for holders of the Common Warrants to exercise such Common Warrants.
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