Syros(US:SYRS)2023-08-08 10:53Acquisition and Mergers - On September 16, 2022, the Company completed the acquisition of Tyme Technologies, Inc., issuing approximately 7.5 million shares and acquiring net cash and marketable securities of approximately $67.1 million[39]. - The Company issued approximately 7.5 million shares of common stock to former Tyme stockholders in connection with the Merger[83]. - As of June 30, 2023, the Company has incurred $3.1 million in transaction costs related to the Merger, which are reflected as a reduction of additional paid-in capital[85]. - The Company incurred $4.5 million in severance payments to former Tyme employees, expensed at the closing of the transaction[85]. - The Company assumed certain Tyme stock options, issuing options to purchase 692,460 shares at the completion of the merger on September 16, 2022[151]. Financial Performance and Revenue - The Company has not generated any revenue from product sales and does not expect to do so in the foreseeable future[61]. - Revenue recognized under the GBT Collaboration Agreement for the three and six months ended June 30, 2023, was $2.8 million and $5.8 million, respectively, compared to $5.7 million and $10.7 million for the same periods in 2022[94]. - The Company did not recognize any revenue under the Incyte Collaboration Agreement during the three and six months ended June 30, 2023, while recognizing $0.6 million and $1.0 million for the same periods in 2022[103]. Cash and Liquidity - As of June 30, 2023, the Company believes it will meet its liquidity requirements for at least 12 months[42]. - Cash, cash equivalents, and marketable securities totaled $143.982 million as of June 30, 2023, down from $202.304 million as of December 31, 2022[106][107]. - The Company has a total cash, cash equivalents, and restricted cash amounting to $118.5 million as of June 30, 2023, compared to $62.2 million in 2022, indicating an increase of 90.5%[116]. - As of June 30, 2023, the Company had deferred revenue of approximately $2.2 million under the GBT Collaboration Agreement, all classified as current[94]. Investments and Securities - The Company filed a universal shelf registration statement to register for sale up to $250.0 million of various securities, declared effective on April 28, 2023[41]. - The fair value of warrant liabilities decreased from $24.472 million as of December 31, 2022, to $18.712 million as of June 30, 2023, reflecting a change in fair value of $(5.760) million[114]. - The average expected volatility for the warrants was 86.95% as of June 30, 2023, compared to 86.79% as of December 31, 2022[113]. Research and Development - Research and development expenses include both internal and external costs, with significant judgments made in estimating accrued liabilities[68][70]. - The Company will recognize revenue associated with the GBT collaboration as research and development services are provided, using an input method based on costs incurred[93]. - The Company completed all target validation activities under the Incyte Collaboration Agreement as of June 30, 2023[100]. Stock-Based Compensation - The Company accounts for stock-based compensation expenses based on grant date fair values, expensed over the vesting period[73]. - The Company recorded a change in fair value of $3.1 million for the 2022 Warrants and $5.8 million for the 2020 Warrants for the six months ended June 30, 2023[139]. - The company granted 1,354,236 restricted stock units during the six months ended June 30, 2023, with an average grant date fair value of $4.00[156]. - The company has $13.2 million of unrecognized stock-based compensation expense related to outstanding restricted stock units and awards, with an expected recognition period of 2.1 years[156]. - Stock-based compensation expense for the three months ended June 30, 2023, was $2,814 million, compared to $2,689 million in 2022, reflecting an increase of 4.6%[158]. Debt and Obligations - The Company has a total minimum loan payment obligation of $40.0 million as of June 30, 2023, with $6.7 million due in 2024 and $20.0 million in 2025[123]. - Interest expense related to the Loan Agreement for the three months ended June 30, 2023, was approximately $1.3 million, compared to $1.0 million for the same period in 2022, reflecting a 30% increase[123]. General Business Operations - The Company operates only in the United States and manages its business as a single operating segment[47]. - The Company has not recognized any impairment losses from inception through June 30, 2023[59]. - The Company’s financial statements are prepared in accordance with U.S. GAAP, with all necessary adjustments made for fair presentation[44]. - The Company’s investment policy prioritizes safety, preservation of principal, and liquidity of investments to meet cash flow requirements[50]. Other Financial Metrics - The Company recorded no realized gains or losses on sales of investments during the six months ended June 30, 2023[107]. - The Company recorded a right-of-use asset and lease liability of $15.8 million for the HQ Lease, with a weighted average discount rate of 9.3%[126]. - The number of authorized shares of the Company's common stock was increased to 700 million before a reverse stock split, which adjusted the number to 70 million shares[133].