Annual report pursuant to Section 13 and 15(d)

Shareholders' Equity

v3.22.0.1
Shareholders' Equity
 12 Months Ended
Dec. 31, 2021
Equity [Abstract]  
Shareholders' Equity Shareholders' EquityCommon shares: The Company has authorized an unlimited number of common shares with no par value. As of December 31, 2021, 2020 and 2019, 141.6 million, 126.7 million and 111.8 million Common Shares, respectively, were issued and outstanding. Each common share entitles the holder to one vote on all matters submitted to a vote of the Company’s shareholders. Common shareholders are not entitled to receive dividends unless declared by the Company’s Board of Directors.
The common share activity for 2021, 2020 and 2019 is as follows:
Common Shares
Number of shares
(in thousands)		 Amount
(in thousands)
Balance at December 31, 2018 85,500  $ 488,744 
Issued pursuant to Public Offering 12,782  191,737 
Issued pursuant to At-the-Market (ATM) Facilities 6,953  45,010 
Share issue costs —  (13,629)
Issued pursuant to exercise of warrants 2,983  12,428 
Issued pursuant to exercise of stock options 3,580  22,197 
Balance at December 31, 2019 111,798  746,487 
Issued pursuant to Public Offering 13,333  200,000 
Share issue costs —  (12,268)
Issued pursuant to exercise of warrants 1  2 
Issued pursuant to exercise of stock options 1,593  10,107 
Balance at December 31, 2020 126,725  944,328 
Issued pursuant to ATM Facilities 10,166  202,356 
Share issue costs —  (5,616)
Issued pursuant to exercise of warrants 1,434  2,102 
Issued pursuant to exercise of stock options 3,238  33,073 
Issued pursuant to ESPP 37  808 
Balance at December 31, 2021 141,600  $ 1,177,051 
As discussed below from time to time, we intend to use the net proceeds from the sale of securities to fund our operations, which includes, but is not limited to, clinical development and commercial production of voclosporin (whether for LN or other indications), advancing our pipeline, regulatory, additional clinical trials, business development opportunities, capital expenditures and working capital.
November 19, 2021 ATM facility
On November 19, 2021 the Company entered into an Open Market Sale Agreement (the "Sale Agreement") with Cantor Fitzgerald & Co. pursuant to which the Company may from time to time sell, through ATM offerings, common shares that would have an aggregate offering price of up to $250.0 million. Pursuant to this agreement the Company issued 10.2 million common shares at a weighted average price of $19.90 resulting in gross proceeds of $202.4 million as of December 31, 2021. The Company incurred share issue costs of approximately $5.6 million which included up to a 3% underwriting commission of $5.3 million and professional fees of $0.3 million directly related to the ATM.
On February 25, 2022, the Company gave notice to Cantor Fitzgerald & Co. to terminate the Sale Agreement. No further sales will occur under the Sale Agreement dated November 19, 2021.
July 27, 2020 public offering

On July 27, 2020 the Company completed a public offering of 13.3 million common shares at a price of $15.00 per share. Gross proceeds from this offering were $200.0 million and the share issue costs totaled an estimated $12.3 million which included a 6% underwriting commission of $12.0 million and professional fees of $0.3 million.
December 12, 2019 public offering
On December 12, 2019 the Company completed a public offering of 12.8 million common shares at a price of $15.00 per share. Gross proceeds from this offering were $191.7 million and the share issue costs totaled $11.8 million which included a 6% underwriting commission of $11.5 million and professional fees of $0.3 million.
September 13, 2019 ATM facility
On September 13, 2019 the Company entered into an Open Market Sale Agreement (the "Sale Agreement") with Jefferies pursuant to which the Company may from time to time sell, through ATM offerings, common shares that would have an aggregate offering price of up to $40.0 million. Pursuant to this agreement the Company issued 2.3 million common shares at a weighted average price of $6.40 resulting in gross proceeds of $15.0 million. The Company incurred share issue costs of $640 thousand including a 3% commission of $450 thousand paid to the agent and professional fees of $190 thousand directly related to the ATM. On December 9, 2019, the Company terminated the September 13, 2019 Sale Agreement with Jefferies LLC related to the 2019 ATM.
Warrants:
Warrant related to February 14, 2014 private placement offering: On February 14, 2014, the Company completed a $52.0 million private placement (2014 Private Offering). Under the terms of the 2014 Private Offering, a Unit consisted of one common share and one-quarter (0.25) of a common share purchase price warrant (2014 Warrant). The Company issued 18.9 million Units at a subscription price per Unit of $2.7485, exercisable for a period of five years from the date of issuance, at an exercise price of $3.2204. These February 2014 Warrants meet the scope exceptions provided in ASC 815, Derivatives and Hedging, as they are indexed to the Company’s own shares, and therefore are accounted for under ASC 505, Equity.
In 2019, certain holders of these 2014 Warrants elected the cashless exercise option and the Company issued 0.7 million common shares in lieu of 1.3 million 2014 Warrants, which was recorded through an increase in equity (common shares) and decrease in additional paid-in capital. One holder of 464,000 2014 Warrants exercised these 2014 Warrants for cash and received 464,000 common shares. The Company received cash proceeds of $1.5 million and recorded an increase in cash and additional paid in capital. In 2018, no holders of the 2014 Warrants elected the cashless exercise option. As a result, the Warrants related to the February 14, 2014 private placement offering have been extinguished upon the exercise of the aforementioned warrants, at December 31, 2019.
Warrant related to December 28, 2016 bought deal public offering: On December 28, 2016, the Company completed a $28.8 million Bought Deal public offering (2016 Public Offering). Under the terms of 2016 Public Offering, each Unit consists of one common share and one-half (0.50) of a common share purchase warrant (December 2016 Warrant). The Company issued 12.8 million Units at a subscription price per Unit of $2.25, exercisable for a period of five years from the date of issuance at an exercise price of $3.00. These December 2016 Warrants also meet the scope exceptions provided in ASC 815, Derivatives and Hedging, as they are indexed to the Company’s own shares, and therefore are accounted for under ASC 505, Equity.
At initial recognition on December 28, 2016, the Company recorded a warrant in the amount of $7.2 million based on the estimated fair value of the December 2016 Warrants with allocated share issuance costs of $655 thousand recognized as a reduction of equity.
During 2019, certain holders of these Warrants exercised at $3.00 per share for gross proceeds of $5.5 million. During 2020, a holder exercised 500 Warrants at $3.00 per share for gross proceeds of $2 thousand. During 2021, 1.7 million warrants have been exercised at $3.00 per share for gross proceeds of $0.3 million. Of these 1.7 million warrants, the Company issued 1.3 million common shares in lieu of 1.6 million warrants. All gross proceeds were recorded as an increase in cash and equity. The remaining 6,000 warrants expired as of December 31, 2021.
The warrant activity for 2021 and 2020 is as follows:
Number of warrants
(in thousands)
Balance at December 31, 2019 1,691 
Warrants exercised (1)
Balance at December 31, 2020 1,690 
Warrants exercised (1,684)
Warrants expired (6)
Balance at December 31, 2021 —