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NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business We are a biopharmaceutical company dedicated to developing and delivering medicines for patients with B-cell mediated diseases, including Chronic Lymphocytic Leukemia (CLL), non-Hodgkin Lymphoma (NHL) and Multiple Sclerosis (MS). We have developed a robust B-cell directed research and development (R&D) platform for identification of key B-cell pathways of interest and rapid clinical testing. Currently, we have five B-cell targeted drug candidates in clinical development, with the lead two therapies, ublituximab (TG-1101) and umbralisib (TGR-1202), in pivotal trials for CLL and NHL, with ublituximab also in pivotal trials for MS. Ublituximab is a novel anti-CD20 monoclonal antibody (mAb) that has been glycoengineered for enhanced potency over first generation antibodies. Umbralisib is an oral, once daily inhibitor of PI3K delta. Umbralisib also uniquely inhibits CK1-epsilon, which may allow it to overcome certain tolerability issues associated with first generation PI3K delta inhibitors. When used together in combination therapy, ublituximab and umbralisib are referred to as “U2”. Additionally, we have recently brought into Phase 1 clinical development TG-1501, an anti-PD-L1 monoclonal antibody, TG-1701, a covalently-bound Bruton’s Tyrosine Kinase (BTK) inhibitor, and TG-1801, an anti-CD47/CD19 bispecific antibody. We also actively evaluate complementary products, technologies and companies for in-licensing, partnership, acquisition and/or investment opportunities. To date, we have not received approval for the sale of any of our drug candidates in any market and, therefore, have not generated any product sales from our drug candidates. The accompanying unaudited condensed consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles, or GAAP, for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X of the Exchange Act. Accordingly, they may not include all of the information and footnotes required by GAAP for complete financial statements. All adjustments that are, in the opinion of management, of a normal recurring nature and are necessary for a fair presentation of the condensed consolidated financial statements have been included. Nevertheless, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2018. The accompanying condensed December 31, 2018 balance sheet has been derived from these statements. The results of operations for the nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the entire fiscal year or any other interim period. In December 2018, the Company created an Australian corporation, TG Therapeutics AUS Pty Ltd, as a wholly-owned subsidiary. This corporation’s functional currency, the Australian dollar, is also its reporting currency, and its financial statements are translated to U.S. dollars, the Company’s reporting currency, prior to consolidation. The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries, and all intercompany accounts and transactions have been eliminated in consolidation. Liquidity and Capital Resources We have incurred operating losses since our inception, expect to continue to incur operating losses for the foreseeable future, and may never become profitable. As of September 30, 2019, we have an accumulated deficit of approximately $661.6 million. Our major sources of cash have been proceeds from the private placement and public offering of equity securities, as well as debt financings. We have not yet commercialized any of our drug candidates and cannot be sure if we will ever be able to do so. Even if we commercialize one or more of our drug candidates, we may not become profitable. Our ability to achieve profitability depends on many factors, including our ability to obtain regulatory approval for our drug candidates; successfully complete any post-approval regulatory obligations; and successfully commercialize our drug candidates alone or in partnership. We may continue to incur substantial operating losses even if we begin to generate revenues from our drug candidates. As of September 30, 2019, we had $72.5 million in cash and cash equivalents, and investment securities. The Company believes its cash, cash equivalents, and investment securities on hand as of September 30, 2019 along with the additional capital raised in the fourth quarter of 2019 (see Note 5) will provide sufficient liquidity for more than a twelve-month period from the date of filing this Quarterly Report on Form 10-Q. The actual amount of cash that we will need to operate is subject to many factors, including, but not limited to, the timing, design and conduct of clinical trials for our drug candidates. We are dependent upon significant future financing to provide the cash necessary to execute our current operations, including the commercialization of any of our drug candidates. Our common stock is listed on the Nasdaq Capital Market and trades under the symbol “TGTX.” <div> Recently Issued Accounting Standards In July 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-11, “Leases - Targeted Improvements” (“ASU 2018-11”) as an update to ASU 2016-02, Leases (“ASU 2016-02” or “Topic 842”) issued on February 25, 2016. ASU 2016-02 is effective for public business entities for fiscal years beginning January 1, 2019. ASU 2016-02 required companies to adopt the new leases standard at the beginning of the earliest period presented in the financial statements, which is January 1, 2017, using a modified retrospective transition method where lessees must recognize lease assets and liabilities for all leases even though those leases may have expired before the effective date of January 1, 2017. Lessees must also provide the new and enhanced disclosures for each period presented, including the comparative periods. ASU 2018-11 provides an entity with an additional (and optional) transition method to adopt the new leases standard. Under this new transition method, an entity initially applies the new lease standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Consequently, an entity’s reporting for the comparative periods presented in the financial statements in which it adopts the new lease standard will continue to be in accordance with ASC 840, “Leases” (“ASC 840”). An entity that elects this additional (and optional) transition method must provide the required ASC 840 disclosures for all periods that continue to be in accordance with ASC 840. The amendments do not change the existing disclosure requirements in ASC 840. ASU 2018-11 is effective for public business entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with earlier adoption permitted. The Company adopted ASU 2018-11 on January 1, 2019 using a modified retrospective method and will not restate comparative periods. We elected the package of practical expedients permitted under the transition guidance, which allows us to carryforward our historical lease classification and our assessment on whether a contract is or contains a lease. The adoption of this guidance resulted in the addition of material balances of right of use assets and lease liability to our consolidated balance sheets at January 1, 2019, primarily relating to our lease of office space (see Note 8). The impact to our consolidated statements of operations was not material as a result of this standard. In June 2018, the FASB issued ASU No. 2018-07, “Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”). ASU 2018-07 expands the scope of FASB Topic 718, Compensation – Stock Compensation (“Topic 718”) to include share-based payment transactions for acquiring goods and services from nonemployees. An entity should only remeasure equity-classified awards for which a measurement date has not been established through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. Upon transition, the entity is required to measure these nonemployee awards at fair value as of the adoption date. The entity must not remeasure assets that are completed. Disclosures required at transition include the nature of and reason for the change in accounting principle and, if applicable, quantitative information about the cumulative effect of the change on retained earnings or other components of equity. ASU 2018-07 is effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. The Company adopted ASU 2018-07 on January 1, 2019. The adoption of ASU 2018-07 did not have a material effect on our consolidated financial statements as of January 1, 2019. The adoption of ASU 2018-07 had no impact on nonemployee performance awards as they are measured based on the outcome that is probable. Other pronouncements issued by the FASB or other authoritative accounting standards group with future effective dates are either not applicable or not significant to our consolidated financial statements. </div> <div> Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the applicable reporting period. On an ongoing basis, we evaluate our estimates and judgments, including those related to accrued expenses and stock-based compensation. Actual results could differ from those estimates. Such differences could be material to the financial statements. </div> <div> Cash and Cash Equivalents We treat liquid investments with original maturities of less than three months when purchased as cash and cash equivalents. </div> <div> Restricted Cash We record cash pledged or held in trust as restricted cash. As of September 30, 2019 and December 31, 2018, we have approximately $1.2 million of restricted cash pledged to secure a line of credit as a security deposit for an Office Agreement (see Note 8). </div> <div> Investment Securities Investment securities at September 30, 2019 and December 31, 2018 consist of short-term government securities. We classify these securities as held-to-maturity. Held-to-maturity securities are those securities in which we have the ability and intent to hold the security until maturity. Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums or discounts. Premiums and discounts are amortized or accreted over the life of the related held-to-maturity security as an adjustment to yield using the effective interest method. A decline in the market value of any investment security below cost, that is deemed to be other than temporary, results in a reduction in the carrying amount to fair value. The impairment is charged to operations and a new cost basis for the security is established. Other-than-temporary impairment charges are included in interest and other income (expense), net. Unrealized gains, if determined to be temporary, are included in accumulated other comprehensive income in equity. Dividend and interest income are recognized when earned. </div> <div> Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and short-term investments. The Company maintains its cash and cash equivalents and short-term investments with high-credit quality financial institutions. At times, such amounts may exceed federally-insured limits. </div> <div> Revenue Recognition Effective January 1, 2018, the Company began recognizing revenue under ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), using the modified retrospective transition method. The impact of adopting the new revenue standard was not material to our consolidated financial statements and there was no adjustment to beginning retained earnings on January 1, 2018. The core principle of this new revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt; width: 36pt;" valign="top"> </td> <td style="padding: 0pt; width: 18pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> Step 1: Identify the contract with the customer </td> </tr> <tr> <td style="padding: 0pt;" valign="top"> </td> <td style="padding: 0pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> Step 2: Identify the performance obligations in the contract </td> </tr> <tr> <td style="padding: 0pt;" valign="top"> </td> <td style="padding: 0pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> Step 3: Determine the transaction price </td> </tr> <tr> <td style="padding: 0pt;" valign="top"> </td> <td style="padding: 0pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> Step 4: Allocate the transaction price to the performance obligations in the contract </td> </tr> <tr> <td style="padding: 0pt;" valign="top"> </td> <td style="padding: 0pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> Step 5: Recognize revenue when the company satisfies a performance obligation </td> </tr> </table> In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt; width: 36pt;" valign="top"> </td> <td style="padding: 0pt; width: 18pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct). </td> </tr> <tr> <td style="padding: 0pt;" valign="top"> </td> <td style="padding: 0pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract). </td> </tr> </table> If a good or service is not distinct, the good or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, some sales taxes). The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time as appropriate. </div> <div> Research and Development Costs Generally, research and development costs are expensed as incurred. Nonrefundable advance payments for goods or services that will be used or rendered for future research and development activities are deferred and amortized over the period that the goods are delivered or the related services are performed, subject to an assessment of recoverability. We make estimates of costs incurred in relation to external clinical research organizations, or CROs, and clinical site costs. We analyze the progress of clinical trials, including levels of patient enrollment, invoices received and contracted costs when evaluating the adequacy of the amount expensed and the related prepaid asset and accrued liability. Significant judgments and estimates must be made and used in determining the accrued balance and expense in any accounting period. We review and accrue CRO expenses and clinical trial study expenses based on work performed and rely upon estimates of those costs applicable to the stage of completion of a study. Accrued CRO costs are subject to revisions as such trials progress to completion. Revisions are charged to expense in the period in which the facts that give rise to the revision become known. With respect to clinical site costs, the financial terms of these agreements are subject to negotiation and vary from contract to contract. Payments under these contracts may be uneven, and depend on factors such as the achievement of certain events, the successful recruitment of patients, the completion of portions of the clinical trial or similar conditions. The objective of our policy is to match the recording of expenses in our financial statements to the actual services received and efforts expended. As such, expense accruals related to clinical site costs are recognized based on our estimate of the degree of completion of the event or events specified in the specific clinical study or trial contract. Prepaid research and development in our condensed consolidated balance sheets includes, among other things, certain costs to third party service providers related to development and manufacturing services as well as clinical development. These agreements often require payments in advance of services performed or goods received. Accordingly, as of September 30, 2019 and December 31, 2018, we recorded approximately $7.0 million and $9.7 million, respectively, in prepaid research and development related to such advance agreements. </div> <div> Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. If the likelihood of realizing the deferred tax assets or liability is less than “more likely than not,” a valuation allowance is then created. We, and our subsidiaries, file income tax returns in the U.S. Federal jurisdiction and in various states. We have tax net operating loss carryforwards that are subject to examination for a number of years beyond the year in which they were generated for tax purposes. Since a portion of these net operating loss carryforwards may be utilized in the future, many of these net operating loss carryforwards will remain subject to examination. We recognize interest and penalties related to uncertain income tax positions in income tax expense. </div> <div> Stock-Based Compensation We recognize all stock-based payments to employees and non-employee directors (as compensation for service) as noncash compensation expense in the condensed consolidated financial statements based on the fair values of such payments. Stock-based compensation expense recognized each period is based on the value of the portion of stock-based payment awards that is ultimately expected to vest during the period. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. In addition, because some of the options, restricted stock and warrants issued to employees, consultants and other third-parties vest upon achievement of certain milestones, the total expense is uncertain. Compensation expense for such awards that vest upon the achievement of milestones is recognized when the achievement of such milestones becomes probable. </div> <div> <div> Basic and Diluted Net Loss Per Common Share Basic net loss per share of our common stock is calculated by dividing net loss applicable to the common stock by the weighted average number of our common stock outstanding for the period. Diluted net loss per share of common stock is the same as basic net loss per share of common stock since potentially dilutive securities from stock options, stock warrants and convertible preferred stock would have an antidilutive effect either because we incurred a net loss during the periods presented or because such potentially dilutive securities were out of the money and the Company realized net income during the periods presented. The amounts of potentially dilutive securities excluded from the calculation were 8,060,758 and 5,230,922 for the three and nine months ended September 30, 2019 and 2018, respectively. <div> The following outstanding shares of potentially dilutive securities were excluded from the computation of net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="6" style="border-bottom: 1pt solid black;" valign="bottom"> Three and Nine Months Ended September 30, </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> 2019 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> 2018 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%;" valign="bottom"> Unvested restricted stock </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 12%;" valign="bottom"> 5,357,204 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 12%;" valign="bottom"> 4,604,775 </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> Stock options </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 2,539,540 </td> <td valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 610,000 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Warrants </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 147,058 </td> <td valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> — </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> Shares issuable upon note conversion </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 16,956 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 16,147 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 8,060,758 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 5,230,922 </td> </tr> </table> </div> </div> <div> </div> </div> Long-Lived Assets and Goodwill Long-lived assets are reviewed for potential impairment when circumstances indicate that the carrying value of long-lived tangible and intangible assets with finite lives may not be recoverable. Management’s policy in determining whether an impairment indicator exists, a triggering event, comprises measurable operating performance criteria as well as qualitative measures. If an analysis is necessitated by the occurrence of a triggering event, we make certain assumptions in determining the impairment amount. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized. Goodwill is reviewed for impairment annually, or earlier when events arise that could indicate that an impairment exists. We test for goodwill impairment using a two-step process. The first step compares the fair value of the reporting unit with the unit’s carrying value, including goodwill. When the carrying value of the reporting unit is greater than fair value, the unit’s goodwill may be impaired, and the second step must be completed to measure the amount of the goodwill impairment charge, if any. In the second step, the implied fair value of the reporting unit’s goodwill is compared with the carrying amount of the unit’s goodwill. If the carrying amount is greater than the implied fair value, the carrying value of the goodwill must be written down to its implied fair value. We will continue to perform impairment tests annually, at December 31, and whenever events or changes in circumstances suggest that the carrying value of an asset may not be recoverable.

Recently Issued Accounting Standards In July 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-11, “Leases - Targeted Improvements” (“ASU 2018-11”) as an update to ASU 2016-02, Leases (“ASU 2016-02” or “Topic 842”) issued on February 25, 2016. ASU 2016-02 is effective for public business entities for fiscal years beginning January 1, 2019. ASU 2016-02 required companies to adopt the new leases standard at the beginning of the earliest period presented in the financial statements, which is January 1, 2017, using a modified retrospective transition method where lessees must recognize lease assets and liabilities for all leases even though those leases may have expired before the effective date of January 1, 2017. Lessees must also provide the new and enhanced disclosures for each period presented, including the comparative periods. ASU 2018-11 provides an entity with an additional (and optional) transition method to adopt the new leases standard. Under this new transition method, an entity initially applies the new lease standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Consequently, an entity’s reporting for the comparative periods presented in the financial statements in which it adopts the new lease standard will continue to be in accordance with ASC 840, “Leases” (“ASC 840”). An entity that elects this additional (and optional) transition method must provide the required ASC 840 disclosures for all periods that continue to be in accordance with ASC 840. The amendments do not change the existing disclosure requirements in ASC 840. ASU 2018-11 is effective for public business entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with earlier adoption permitted. The Company adopted ASU 2018-11 on January 1, 2019 using a modified retrospective method and will not restate comparative periods. We elected the package of practical expedients permitted under the transition guidance, which allows us to carryforward our historical lease classification and our assessment on whether a contract is or contains a lease. The adoption of this guidance resulted in the addition of material balances of right of use assets and lease liability to our consolidated balance sheets at January 1, 2019, primarily relating to our lease of office space (see Note 8). The impact to our consolidated statements of operations was not material as a result of this standard. In June 2018, the FASB issued ASU No. 2018-07, “Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”). ASU 2018-07 expands the scope of FASB Topic 718, Compensation – Stock Compensation (“Topic 718”) to include share-based payment transactions for acquiring goods and services from nonemployees. An entity should only remeasure equity-classified awards for which a measurement date has not been established through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. Upon transition, the entity is required to measure these nonemployee awards at fair value as of the adoption date. The entity must not remeasure assets that are completed. Disclosures required at transition include the nature of and reason for the change in accounting principle and, if applicable, quantitative information about the cumulative effect of the change on retained earnings or other components of equity. ASU 2018-07 is effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. The Company adopted ASU 2018-07 on January 1, 2019. The adoption of ASU 2018-07 did not have a material effect on our consolidated financial statements as of January 1, 2019. The adoption of ASU 2018-07 had no impact on nonemployee performance awards as they are measured based on the outcome that is probable. Other pronouncements issued by the FASB or other authoritative accounting standards group with future effective dates are either not applicable or not significant to our consolidated financial statements.

Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the applicable reporting period. On an ongoing basis, we evaluate our estimates and judgments, including those related to accrued expenses and stock-based compensation. Actual results could differ from those estimates. Such differences could be material to the financial statements.

Cash and Cash Equivalents We treat liquid investments with original maturities of less than three months when purchased as cash and cash equivalents.

Restricted Cash We record cash pledged or held in trust as restricted cash. As of September 30, 2019 and December 31, 2018, we have approximately $1.2 million of restricted cash pledged to secure a line of credit as a security deposit for an Office Agreement (see Note 8).

Investment Securities Investment securities at September 30, 2019 and December 31, 2018 consist of short-term government securities. We classify these securities as held-to-maturity. Held-to-maturity securities are those securities in which we have the ability and intent to hold the security until maturity. Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums or discounts. Premiums and discounts are amortized or accreted over the life of the related held-to-maturity security as an adjustment to yield using the effective interest method. A decline in the market value of any investment security below cost, that is deemed to be other than temporary, results in a reduction in the carrying amount to fair value. The impairment is charged to operations and a new cost basis for the security is established. Other-than-temporary impairment charges are included in interest and other income (expense), net. Unrealized gains, if determined to be temporary, are included in accumulated other comprehensive income in equity. Dividend and interest income are recognized when earned.

Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and short-term investments. The Company maintains its cash and cash equivalents and short-term investments with high-credit quality financial institutions. At times, such amounts may exceed federally-insured limits.

Revenue Recognition Effective January 1, 2018, the Company began recognizing revenue under ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), using the modified retrospective transition method. The impact of adopting the new revenue standard was not material to our consolidated financial statements and there was no adjustment to beginning retained earnings on January 1, 2018. The core principle of this new revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt; width: 36pt;" valign="top"> </td> <td style="padding: 0pt; width: 18pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> Step 1: Identify the contract with the customer </td> </tr> <tr> <td style="padding: 0pt;" valign="top"> </td> <td style="padding: 0pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> Step 2: Identify the performance obligations in the contract </td> </tr> <tr> <td style="padding: 0pt;" valign="top"> </td> <td style="padding: 0pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> Step 3: Determine the transaction price </td> </tr> <tr> <td style="padding: 0pt;" valign="top"> </td> <td style="padding: 0pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> Step 4: Allocate the transaction price to the performance obligations in the contract </td> </tr> <tr> <td style="padding: 0pt;" valign="top"> </td> <td style="padding: 0pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> Step 5: Recognize revenue when the company satisfies a performance obligation </td> </tr> </table> In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt; width: 36pt;" valign="top"> </td> <td style="padding: 0pt; width: 18pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct). </td> </tr> <tr> <td style="padding: 0pt;" valign="top"> </td> <td style="padding: 0pt;" valign="top"> ● </td> <td style="padding: 0pt;" valign="top"> The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract). </td> </tr> </table> If a good or service is not distinct, the good or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, some sales taxes). The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time as appropriate.

Research and Development Costs Generally, research and development costs are expensed as incurred. Nonrefundable advance payments for goods or services that will be used or rendered for future research and development activities are deferred and amortized over the period that the goods are delivered or the related services are performed, subject to an assessment of recoverability. We make estimates of costs incurred in relation to external clinical research organizations, or CROs, and clinical site costs. We analyze the progress of clinical trials, including levels of patient enrollment, invoices received and contracted costs when evaluating the adequacy of the amount expensed and the related prepaid asset and accrued liability. Significant judgments and estimates must be made and used in determining the accrued balance and expense in any accounting period. We review and accrue CRO expenses and clinical trial study expenses based on work performed and rely upon estimates of those costs applicable to the stage of completion of a study. Accrued CRO costs are subject to revisions as such trials progress to completion. Revisions are charged to expense in the period in which the facts that give rise to the revision become known. With respect to clinical site costs, the financial terms of these agreements are subject to negotiation and vary from contract to contract. Payments under these contracts may be uneven, and depend on factors such as the achievement of certain events, the successful recruitment of patients, the completion of portions of the clinical trial or similar conditions. The objective of our policy is to match the recording of expenses in our financial statements to the actual services received and efforts expended. As such, expense accruals related to clinical site costs are recognized based on our estimate of the degree of completion of the event or events specified in the specific clinical study or trial contract. Prepaid research and development in our condensed consolidated balance sheets includes, among other things, certain costs to third party service providers related to development and manufacturing services as well as clinical development. These agreements often require payments in advance of services performed or goods received. Accordingly, as of September 30, 2019 and December 31, 2018, we recorded approximately $7.0 million and $9.7 million, respectively, in prepaid research and development related to such advance agreements.

Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. If the likelihood of realizing the deferred tax assets or liability is less than “more likely than not,” a valuation allowance is then created. We, and our subsidiaries, file income tax returns in the U.S. Federal jurisdiction and in various states. We have tax net operating loss carryforwards that are subject to examination for a number of years beyond the year in which they were generated for tax purposes. Since a portion of these net operating loss carryforwards may be utilized in the future, many of these net operating loss carryforwards will remain subject to examination. We recognize interest and penalties related to uncertain income tax positions in income tax expense.

Stock-Based Compensation We recognize all stock-based payments to employees and non-employee directors (as compensation for service) as noncash compensation expense in the condensed consolidated financial statements based on the fair values of such payments. Stock-based compensation expense recognized each period is based on the value of the portion of stock-based payment awards that is ultimately expected to vest during the period. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. In addition, because some of the options, restricted stock and warrants issued to employees, consultants and other third-parties vest upon achievement of certain milestones, the total expense is uncertain. Compensation expense for such awards that vest upon the achievement of milestones is recognized when the achievement of such milestones becomes probable.

Basic and Diluted Net Loss Per Common Share Basic net loss per share of our common stock is calculated by dividing net loss applicable to the common stock by the weighted average number of our common stock outstanding for the period. Diluted net loss per share of common stock is the same as basic net loss per share of common stock since potentially dilutive securities from stock options, stock warrants and convertible preferred stock would have an antidilutive effect either because we incurred a net loss during the periods presented or because such potentially dilutive securities were out of the money and the Company realized net income during the periods presented. The amounts of potentially dilutive securities excluded from the calculation were 8,060,758 and 5,230,922 for the three and nine months ended September 30, 2019 and 2018, respectively. <div> The following outstanding shares of potentially dilutive securities were excluded from the computation of net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="6" style="border-bottom: 1pt solid black;" valign="bottom"> Three and Nine Months Ended September 30, </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> 2019 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> 2018 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%;" valign="bottom"> Unvested restricted stock </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 12%;" valign="bottom"> 5,357,204 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 12%;" valign="bottom"> 4,604,775 </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> Stock options </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 2,539,540 </td> <td valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 610,000 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Warrants </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 147,058 </td> <td valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> — </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> Shares issuable upon note conversion </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 16,956 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 16,147 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 8,060,758 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 5,230,922 </td> </tr> </table> </div>

8060758

5230922

The following outstanding shares of potentially dilutive securities were excluded from the computation of net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="6" style="border-bottom: 1pt solid black;" valign="bottom"> Three and Nine Months Ended September 30, </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> 2019 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> 2018 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%;" valign="bottom"> Unvested restricted stock </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 12%;" valign="bottom"> 5,357,204 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 12%;" valign="bottom"> 4,604,775 </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> Stock options </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 2,539,540 </td> <td valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 610,000 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Warrants </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 147,058 </td> <td valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> — </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> Shares issuable upon note conversion </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 16,956 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 16,147 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 8,060,758 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 5,230,922 </td> </tr> </table>

Long-Lived Assets and Goodwill Long-lived assets are reviewed for potential impairment when circumstances indicate that the carrying value of long-lived tangible and intangible assets with finite lives may not be recoverable. Management’s policy in determining whether an impairment indicator exists, a triggering event, comprises measurable operating performance criteria as well as qualitative measures. If an analysis is necessitated by the occurrence of a triggering event, we make certain assumptions in determining the impairment amount. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized. Goodwill is reviewed for impairment annually, or earlier when events arise that could indicate that an impairment exists. We test for goodwill impairment using a two-step process. The first step compares the fair value of the reporting unit with the unit’s carrying value, including goodwill. When the carrying value of the reporting unit is greater than fair value, the unit’s goodwill may be impaired, and the second step must be completed to measure the amount of the goodwill impairment charge, if any. In the second step, the implied fair value of the reporting unit’s goodwill is compared with the carrying amount of the unit’s goodwill. If the carrying amount is greater than the implied fair value, the carrying value of the goodwill must be written down to its implied fair value. We will continue to perform impairment tests annually, at December 31, and whenever events or changes in circumstances suggest that the carrying value of an asset may not be recoverable.

NOTE 2 – CASH AND CASH EQUIVALENTS <div> The following tables summarize our cash and cash equivalents at September 30, 2019 and December 31, 2018: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; margin: 0px;"> <tr> <td style="padding: 0pt;" valign="bottom"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> December 31, 2018 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt; width: 70%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 12%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 12%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Checking and bank deposits </td> <td> </td> <td valign="bottom"> $ </td> <td valign="bottom"> 42,302 </td> <td valign="bottom"> </td> <td> </td> <td valign="bottom"> $ </td> <td valign="bottom"> 39,268 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> Money market funds </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 2,373 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 2,690 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 44,675 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 41,958 </td> </tr> </table> </div>

The following tables summarize our cash and cash equivalents at September 30, 2019 and December 31, 2018: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; margin: 0px;"> <tr> <td style="padding: 0pt;" valign="bottom"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> December 31, 2018 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt; width: 70%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 12%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 12%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Checking and bank deposits </td> <td> </td> <td valign="bottom"> $ </td> <td valign="bottom"> 42,302 </td> <td valign="bottom"> </td> <td> </td> <td valign="bottom"> $ </td> <td valign="bottom"> 39,268 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> Money market funds </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 2,373 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 2,690 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 44,675 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 41,958 </td> </tr> </table>

42302000

39268000

2373000

2690000

44675000

41958000

NOTE 3 – INVESTMENT SECURITIES Our investments as of September 30, 2019 and December 31, 2018 are classified as held-to-maturity. Held-to-maturity investments are recorded at amortized cost. <div> The following tables summarize our investment securities at September 30, 2019 and December 31, 2018: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;" width="100%"> <tr> <td style="padding: 0pt;" valign="bottom"> (in thousands) </td> <td> </td> <td colspan="14" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> Amortized cost, as adjusted </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> Gross unrealized holding gains </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="vertical-align: bottom; padding: 0pt; border-bottom: Black 1pt solid;"> Gross unrealized holding losses </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> Estimated fair value </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 48%;" valign="bottom"> Short-term investments: </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: white;"> <td style="padding: 0pt;" valign="bottom"> Obligations of domestic governmental agencies (maturing between October 2019 and September 2020) (held-to-maturity) </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 27,776 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 35 </td> <td valign="bottom"> </td> <td> </td> <td style="vertical-align: bottom; border-bottom: Black 1pt solid;"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 3 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 27,808 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Total short-term investment securities </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 27,776 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 35 </td> <td valign="bottom"> </td> <td> </td> <td style="vertical-align: bottom; border-bottom: Black 2.5pt double;"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 3 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 27,808 </td> <td valign="bottom"> </td> </tr> </table> <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2"> </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt;"> </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt;"> </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt;"> </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> </td> <td> </td> <td colspan="14" style="border-bottom: 1pt solid black;" valign="bottom"> December 31, 2018 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> Amortized cost, as adjusted </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> Gross unrealized holding gains </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> Gross unrealized holding losses </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> Estimated fair value </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 48%;" valign="bottom"> Short-term investments: </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: white;"> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Obligations of domestic governmental agencies (maturing between January 2019 and November 2019) (held-to-maturity) </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 26,943 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 2 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 10 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 26,935 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Total short-term investment securities </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 26,943 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 2 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 10 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 26,935 </td> </tr> </table> </div>

The following tables summarize our investment securities at September 30, 2019 and December 31, 2018: <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;" width="100%"> <tr> <td style="padding: 0pt;" valign="bottom"> (in thousands) </td> <td> </td> <td colspan="14" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> Amortized cost, as adjusted </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> Gross unrealized holding gains </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="vertical-align: bottom; padding: 0pt; border-bottom: Black 1pt solid;"> Gross unrealized holding losses </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> Estimated fair value </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 48%;" valign="bottom"> Short-term investments: </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: white;"> <td style="padding: 0pt;" valign="bottom"> Obligations of domestic governmental agencies (maturing between October 2019 and September 2020) (held-to-maturity) </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 27,776 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 35 </td> <td valign="bottom"> </td> <td> </td> <td style="vertical-align: bottom; border-bottom: Black 1pt solid;"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 3 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 27,808 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> Total short-term investment securities </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 27,776 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 35 </td> <td valign="bottom"> </td> <td> </td> <td style="vertical-align: bottom; border-bottom: Black 2.5pt double;"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 3 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 27,808 </td> <td valign="bottom"> </td> </tr> </table> <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2"> </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt;"> </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt;"> </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt;"> </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> </td> <td> </td> <td colspan="14" style="border-bottom: 1pt solid black;" valign="bottom"> December 31, 2018 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> Amortized cost, as adjusted </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> Gross unrealized holding gains </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> Gross unrealized holding losses </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: 1pt solid black;" valign="bottom"> Estimated fair value </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 48%;" valign="bottom"> Short-term investments: </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: white;"> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Obligations of domestic governmental agencies (maturing between January 2019 and November 2019) (held-to-maturity) </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 26,943 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 2 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 10 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 26,935 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Total short-term investment securities </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 26,943 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 2 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 10 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 26,935 </td> </tr> </table>

27776000

35000

3000

27808000

27776000

35000

3000

27808000

26943000

2000

10000

26935000

26943000

2000

10000

26935000

NOTE 4 – FAIR VALUE MEASUREMENTS We measure certain financial assets and liabilities at fair value on a recurring basis in the condensed consolidated financial statements. The fair value hierarchy ranks the quality and reliability of inputs, or assumptions, used in the determination of fair value and requires financial assets and liabilities carried at fair value to be classified and disclosed in one of the following three categories: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;" width="100%"> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="top"> ● </td> <td style="padding: 0pt 0pt 0pt 0pt;" valign="top"> Level 1 – quoted prices in active markets for identical assets and liabilities; </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;"> </td> <td style="padding: 0pt 0pt 0pt 0pt;"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="top"> ● </td> <td style="padding: 0pt 0pt 0pt 0pt;" valign="top"> Level 2 – inputs other than Level 1 quoted prices that are directly or indirectly observable; and </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;"> </td> <td style="padding: 0pt 0pt 0pt 0pt;"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt; width: 3%;" valign="top"> ● </td> <td style="padding: 0pt 0pt 0pt 0pt; width: 97%;" valign="top"> Level 3 – unobservable inputs that are not corroborated by market data. </td> </tr> </table> As of September 30, 2019 and December 31, 2018, the fair values of cash and cash equivalents, restricted cash, and notes and interest payable, approximate their carrying value. At the time of our merger (we were then known as Manhattan Pharmaceuticals, Inc.) with Ariston Pharmaceuticals, Inc. (“Ariston”) in March 2010, Ariston issued $15.5 million of five-year 5% notes payable (the “5% Notes”) in satisfaction of several note payable issuances. The 5% Notes and accrued and unpaid interest thereon are convertible at the option of the holder into common stock at the conversion price of $1,125 per share. Ariston agreed to make quarterly payments on the 5% Notes equal to 50% of the net product cash flow received from the exploitation or commercialization of Ariston’s product candidates, AST-726 and AST-915. We have no obligations under the 5% Notes aside from (a) 50% of the net product cash flows from Ariston’s product candidates, if any, payable to noteholders; and (b) the conversion feature, discussed above. The cumulative liability to the Ariston subsidiary including accrued and unpaid interest of the 5% Notes was approximately $19.1 million at September 30, 2019 and $18.4 million at December 31, 2018. No payments have been made on the 5% Notes since the merger and through September 30, 2019. In December 2011, we elected the fair value option for valuing the 5% Notes. The fair value option was elected in order to reflect in our financial statements the assumptions that market participants use in evaluating these financial instruments. As of December 31, 2013, as a result of expiring intellectual property rights and other factors, it was determined that net product cash flows from AST-726 were unlikely. As we have no other obligations under the 5% Notes aside from the net product cash flows and the conversion feature, the conversion feature was used to estimate the 5% Notes’ fair value as of September 30, 2019 and December 31, 2018. The assumptions, assessments and projections of future revenues are subject to uncertainties, difficult to predict, and require significant judgment. The use of different assumptions, applying different judgment to inherently subjective matters and changes in future market conditions could result in significantly different estimates of fair value and the differences could be material to our condensed consolidated financial statements. <div> The following tables provide the fair value measurements of applicable financial liabilities as of September 30, 2019 and December 31, 2018: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; margin: 0px;" width="100%"> <tr> <td style="padding: 0pt;" valign="bottom"> (in thousands) </td> <td> </td> <td colspan="14" style="border-bottom: 1pt solid black;" valign="bottom"> Financial liabilities at fair value as of September 30, 2019 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 1 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 2 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 3 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Total </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt; width: 48%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> 5% Notes </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> </tr> </table> <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> </td> <td> </td> <td colspan="14" style="border-bottom: 1pt solid black;" valign="bottom"> Financial liabilities at fair value as of December 31, 2018 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 1 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 2 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 3 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Total </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt; width: 48%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> 5% Notes </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 67 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 67 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 67 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 67 </td> </tr> </table> </div> The Level 3 amounts above represent the fair value of the 5% Notes and related accrued interest. The Company’s financial instruments include cash, cash equivalents consisting of money market funds, accounts payable and debt. Cash, cash equivalents, accounts payable and debt are stated at their respective historical carrying amounts, which approximate fair value due to their short-term nature. <div> The following table summarizes the changes in Level 3 instruments during the nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;" width="100%"> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> (in thousands) </td> <td> </td> <td colspan="2" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt; width: 85%;" valign="bottom"> </td> <td style="width: 3%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Fair value at December 31, 2018 </td> <td> </td> <td valign="bottom"> $ </td> <td valign="bottom"> 67 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Interest accrued on face value of 5% Notes </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 690 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Change in fair value of Level 3 liabilities </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> (662 </td> <td style="padding-bottom: 1pt;" valign="bottom"> ) </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Fair value at September 30, 2019 </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 95 </td> </tr> </table> </div> The change in the fair value of the Level 3 liabilities is reported in other (income) expense in the accompanying condensed consolidated statements of operations.

19100000 18400000

The following tables provide the fair value measurements of applicable financial liabilities as of September 30, 2019 and December 31, 2018: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; margin: 0px;" width="100%"> <tr> <td style="padding: 0pt;" valign="bottom"> (in thousands) </td> <td> </td> <td colspan="14" style="border-bottom: 1pt solid black;" valign="bottom"> Financial liabilities at fair value as of September 30, 2019 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 1 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 2 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 3 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Total </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt; width: 48%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt;" valign="bottom"> 5% Notes </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> </tr> </table> <table border="0" cellpadding="0" cellspacing="0" style="width: 100%; border-collapse: collapse; margin: 0px;"> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> </td> <td> </td> <td colspan="14" style="border-bottom: 1pt solid black;" valign="bottom"> Financial liabilities at fair value as of December 31, 2018 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt;" valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 1 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 2 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Level 3 </td> <td valign="bottom"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Total </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt; width: 48%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> 5% Notes </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 67 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> 67 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 67 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 67 </td> </tr> </table>

95000

67000

The following table summarizes the changes in Level 3 instruments during the nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;" width="100%"> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> (in thousands) </td> <td> </td> <td colspan="2" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt; width: 85%;" valign="bottom"> </td> <td style="width: 3%;"> </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 10%;" valign="bottom"> </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Fair value at December 31, 2018 </td> <td> </td> <td valign="bottom"> $ </td> <td valign="bottom"> 67 </td> <td valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Interest accrued on face value of 5% Notes </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> 690 </td> <td valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Change in fair value of Level 3 liabilities </td> <td> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> </td> <td style="border-bottom: 1pt solid black;" valign="bottom"> (662 </td> <td style="padding-bottom: 1pt;" valign="bottom"> ) </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Fair value at September 30, 2019 </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 95 </td> </tr> </table>

67000

690000

-662000

95000

NOTE 5 - STOCKHOLDERS’ EQUITY Preferred Stock Our amended and restated certificate of incorporation authorizes the issuance of up to 10,000,000 shares of preferred stock, $ 0.001 par value, with rights senior to those of our common stock, issuable in one or more series. Upon issuance, we can determine the rights, preferences, privileges and restrictions thereof. These rights, preferences and privileges could include dividend rights, conversion rights, voting rights, terms of redemption, liquidation preferences, sinking fund terms and the number of shares constituting any series or the designation of such series, any or all of which may be greater than the rights of common stock. Common Stock Our amended and restated certificate of incorporation authorizes the issuance of up to 150,000,000 shares of $ 0.001 par value common stock. In May 2017, we filed a shelf registration statement on Form S-3 (the “2017 S-3”), which was declared effective in June 2017, replacing the 2015 S-3. Under the 2017 S-3, the Company may sell up to a total of $300 million of its securities. In connection with the 2017 S-3, we entered into an At-the-Market Issuance Sales Agreement (the “2017 ATM”) with Jefferies LLC, Cantor Fitzgerald & Co., FBR Capital Markets & Co., SunTrust Robinson Humphrey, Inc., Raymond James & Associates, Inc., Ladenburg Thalmann & Co. Inc. and H.C. Wainwright & Co., LLC (each a “2017 Agent” and collectively, the “2017 Agents”), relating to the sale of shares of our common stock. Under the 2017 ATM we pay the 2017 Agents a commission rate of up to 3.0% of the gross proceeds from the sale of any shares of common stock. In March 2019, we completed an underwritten public offering of 4,100,000 shares of our common stock (plus a 30-day underwriter overallotment option to purchase up to an additional 615,000 shares of common stock, which was exercised), at a price of $5.87 per share. Proceeds from this offering, including the overallotment, after underwriting discounts and offering expenses were approximately $27.5 million. During the nine months ended September 30, 2019, we sold a total of 6,559,819 shares of common stock under the 2017 ATM for aggregate total gross proceeds of approximately $50.0 million at an average selling price of $7.62 per share, resulting in net proceeds of approximately $49.2 million after deducting commissions and other transactions costs. Subsequent to the third quarter, from October 1, 2019 through November 12, 2019, we sold an aggregate of 3,641,346 shares of common stock pursuant to the 2017 ATM for aggregate total gross proceeds of approximately $22.4 million at an average selling price of $6.16 per share, resulting in net proceeds of approximately $22.1 million after deducting commissions and other transactions costs. The 2017 S-3 is currently our only active shelf registration statement. After deducting shares already sold there is approximately $36.3 million of common stock that remains available for sale under the 2017 S-3. We may offer the securities under the 2017 S-3 from time to time in response to market conditions or other circumstances if we believe such a plan of financing is in the best interests of our stockholders. We believe that the 2017 S-3 provides us with the flexibility to raise additional capital to finance our operations as needed. Equity Incentive Plans The TG Therapeutics, Inc. Amended and Restated 2012 Incentive Plan (“2012 Incentive Plan”) was approved by stockholders in June 2018. As of September 30, 2019, 6,857,207 shares of restricted stock and 2,539,540 options were outstanding and up to an additional 1,114,263 shares may be issued under the 2012 Incentive Plan. Effective as of January 1, 2017, we entered into an amendment (the “Amendment”) to the employment agreement entered as of December 15, 2011 (together with the Amendment, the “Employment Agreement”) with Michael S. Weiss, our Executive Chairman and Chief Executive Officer and President. Under the Amendment, Mr. Weiss will remain as Chief Executive Officer and President, removing the interim status. Simultaneously, we entered into a Strategic Advisory Agreement (the “Advisory Agreement”) with Caribe BioAdvisors, LLC (the “Advisor”) owned by Mr. Weiss to provide the services of Mr. Weiss as Chairman of the Board and as Executive Chairman. As part of the Amendment, Mr. Weiss also agreed to forfeit 3,381,866 restricted shares previously granted under the Employment Agreement that were predominantly subject to time-based vesting over the next three years. Simultaneously, (i) Mr. Weiss was issued 418,371 restricted shares under the Employment Agreement that vest in 2018 and 2019 and (ii) the Advisor was issued 2,960,000 restricted shares under the Advisory Agreement that vested on market capitalization thresholds ranging from $375 million to $750 million. In accordance with GAAP, there was no incremental stock compensation expense recognition as a result of the modification. Stock Options <div> <div> The following table summarizes stock option activity for the nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt; border-bottom: 1pt solid black;" valign="bottom"> Number of shares </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Weighted- average exercise price </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Weighted- average contractual term </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Aggregate intrinsic value </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; width: 40%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 12%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 12%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 12%; vertical-align: bottom;"> (in years) </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 12%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Outstanding at December 31, 2018 </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> 1,916,900 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> 6.50 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> 9.75 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Granted </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 740,000 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 6.90 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Exercised </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Forfeited </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> (117,360) </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 6.25 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Expired </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Outstanding at September 30, 2019 </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> 2,539,540 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> 6.63 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> 9.14 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> 1,849,055 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Expected to vest at September 30, 2019 </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 2,539,540 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 6.63 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 9.14 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 1,849,055 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Exercisable at September 30, 2019 </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> — </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> — </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> — </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> — </td> </tr> </table> </div> </div> Total expense associated with the stock options was approximately $0.8 million and zero during the three months ended September 30, 2019 and 2018, respectively, and $2.3 million and zero during the nine months ended September 30, 2019 and 2018, respectively. As of September 30, 2019, there was approximately $3.4 million of total unrecognized compensation cost related to unvested time-based stock options, which is expected to be recognized over a weighted-average period of 1.72 years. As of September 30, 2019, the stock options outstanding include options granted to both employees and non-employees which are both time-based and milestone-based. Stock-based compensation for milestone-based options will be recorded if and when a milestone occurs. <div> The fair value of the Company’s option awards granted during the nine months ended September 30, 2019 and 2018 were estimated on the grant date using the Black-Scholes option-pricing model using the assumptions below: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td colspan="6" style="border-bottom: 1pt solid black;" valign="bottom"> Nine months ended </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> September 30, 2018 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%; vertical-align: bottom;"> Volatility </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="vertical-align: bottom; width: 12%;"> 172.99-291.61 </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="vertical-align: bottom; width: 12%;"> 186.99-305.77 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Expected term (in years) </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 5.0-6.25 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 5.0-6.25 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Risk-free rate </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1.96-2.49 </td> <td style="vertical-align: bottom;"> % </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 2.56-2.72 </td> <td style="vertical-align: bottom;"> % </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Expected dividend yield </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> — </td> <td style="vertical-align: bottom;"> % </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> — </td> <td style="vertical-align: bottom;"> % </td> </tr> </table> </div> <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="vertical-align: bottom;"> </td> </tr> </table> Restricted Stock Certain employees, directors and consultants have been awarded restricted stock. The restricted stock vesting consists of milestone and time-based vesting. <div> The following table summarizes restricted share activity for the nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> Number of Shares </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Weighted Average Grant Date Fair Value </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%; vertical-align: bottom;"> Outstanding at December 31, 2018 </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="vertical-align: bottom; width: 12%;"> 6,095,692 </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> $ </td> <td style="vertical-align: bottom; width: 12%;"> 8.07 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Granted </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1,586,520 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 12.95 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Vested </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> (713,625 </td> <td style="vertical-align: bottom;"> ) </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 9.21 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Forfeited </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> (111,380 </td> <td style="padding-bottom: 1pt; vertical-align: bottom;"> ) </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 7.84 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Outstanding at September 30, 2019 </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 6,857,207 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 7.68 </td> </tr> </table> </div> Total expense associated with restricted stock grants was approximately $1.3 million and $(0.2) million during the three months ended September 30, 2019 and 2018, respectively, and $3.4 million, and $11.4 million during the nine months ended September 30, 2019 and 2018, respectively. As of September 30, 2019, there was approximately $5.3 million of total unrecognized compensation cost related to unvested time-based restricted stock, which is expected to be recognized over a weighted-average period of 1.2 years. This amount does not include, as of September 30, 2019, 4,182,391 shares of restricted stock outstanding which are milestone-based and vest upon certain corporate milestones. Until the measurement date is reached for milestone awards, the total amount of compensation expense remains uncertain. We record compensation expense based on the fair value of the award at the grant date. Stock-Based Compensation <div> The following table summarizes stock-based compensation expense information about restricted stock and stock options for the three and nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> Three months ended September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt; border-bottom: 1pt solid black;" valign="bottom"> Nine months ended September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%; vertical-align: bottom;"> Stock-based compensation expense associated with restricted stock </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> $ </td> <td style="vertical-align: bottom; width: 12%;"> 1,253 </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> $ </td> <td style="vertical-align: bottom; width: 12%;"> 3,381 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Stock-based compensation expense associated with option grants </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 822 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 2,333 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Total </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 2,075 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 5,714 </td> </tr> </table> </div> Warrants <div> The following table summarizes warrant activity for the nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Warrants </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Weighted-average exercise price </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Aggregate Intrinsic Value </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; width: 59%; vertical-align: bottom;"> Outstanding at December 31, 2018 </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 10%; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> $ </td> <td style="background-color: #cceeff; padding: 0pt; width: 12%; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%;"> </td> <td style="background-color: #cceeff; padding: 0pt; border-bottom: black 1pt solid; width: 1%; vertical-align: bottom;"> $ </td> <td style="background-color: #cceeff; padding: 0pt; border-bottom: black 1pt solid; width: 10%; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Issued </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 147,058 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 4.08 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Exercised </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Expired </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> — </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> — </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Outstanding at September 30, 2019 </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 147,058 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 4.08 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 224,999 </td> </tr> </table> </div> There was no stock compensation expense related to warrants during the nine months ended September 30, 2019.

10000000

0.001

150000000

0.001

6559819

50000000 7.62

49200000

3641346

22400000 6.16

22100000

2539540

The following table summarizes stock option activity for the nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt; border-bottom: 1pt solid black;" valign="bottom"> Number of shares </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Weighted- average exercise price </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Weighted- average contractual term </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Aggregate intrinsic value </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; width: 40%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 12%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 12%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 12%; vertical-align: bottom;"> (in years) </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 12%; vertical-align: bottom;"> </td> <td style="padding: 0pt; width: 1%; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Outstanding at December 31, 2018 </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> 1,916,900 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> 6.50 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> 9.75 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Granted </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 740,000 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 6.90 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Exercised </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Forfeited </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> (117,360) </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 6.25 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Expired </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Outstanding at September 30, 2019 </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> 2,539,540 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> 6.63 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> 9.14 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> 1,849,055 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Expected to vest at September 30, 2019 </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 2,539,540 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 6.63 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 9.14 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 1,849,055 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Exercisable at September 30, 2019 </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> — </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> — </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> — </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; vertical-align: bottom;"> — </td> </tr> </table>

1916900

6.50

P9Y9M

740000

6.90

117360

6.25

2539540

6.63

P9Y1M20D

1849055000

2539540

6.63

P9Y1M20D

1849055000

The fair value of the Company’s option awards granted during the nine months ended September 30, 2019 and 2018 were estimated on the grant date using the Black-Scholes option-pricing model using the assumptions below: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td colspan="6" style="border-bottom: 1pt solid black;" valign="bottom"> Nine months ended </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> September 30, 2018 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%; vertical-align: bottom;"> Volatility </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="vertical-align: bottom; width: 12%;"> 172.99-291.61 </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="vertical-align: bottom; width: 12%;"> 186.99-305.77 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Expected term (in years) </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 5.0-6.25 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 5.0-6.25 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Risk-free rate </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1.96-2.49 </td> <td style="vertical-align: bottom;"> % </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 2.56-2.72 </td> <td style="vertical-align: bottom;"> % </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Expected dividend yield </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> — </td> <td style="vertical-align: bottom;"> % </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> — </td> <td style="vertical-align: bottom;"> % </td> </tr> </table>

1.7299

2.9161

1.8699

3.0577

P5Y

P6Y3M

P5Y

P6Y3M

0.0196

0.0249

0.0256

0.0272

The following table summarizes restricted share activity for the nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> Number of Shares </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Weighted Average Grant Date Fair Value </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%; vertical-align: bottom;"> Outstanding at December 31, 2018 </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="vertical-align: bottom; width: 12%;"> 6,095,692 </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> $ </td> <td style="vertical-align: bottom; width: 12%;"> 8.07 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Granted </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1,586,520 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 12.95 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Vested </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> (713,625 </td> <td style="vertical-align: bottom;"> ) </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 9.21 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Forfeited </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> (111,380 </td> <td style="padding-bottom: 1pt; vertical-align: bottom;"> ) </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 7.84 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Outstanding at September 30, 2019 </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 6,857,207 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 7.68 </td> </tr> </table>

6095692

8.07

1586520

12.95

-713625

9.21

-111380

7.84

6857207

7.68

5300000

The following table summarizes stock-based compensation expense information about restricted stock and stock options for the three and nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> Three months ended September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt; border-bottom: 1pt solid black;" valign="bottom"> Nine months ended September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%; vertical-align: bottom;"> Stock-based compensation expense associated with restricted stock </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> $ </td> <td style="vertical-align: bottom; width: 12%;"> 1,253 </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> $ </td> <td style="vertical-align: bottom; width: 12%;"> 3,381 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Stock-based compensation expense associated with option grants </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 822 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 2,333 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Total </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 2,075 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 5,714 </td> </tr> </table>

1253000

3381000

822000

2333000

2075000

5714000

The following table summarizes warrant activity for the nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Warrants </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Weighted-average exercise price </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td colspan="2" style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> Aggregate Intrinsic Value </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; width: 59%; vertical-align: bottom;"> Outstanding at December 31, 2018 </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 10%; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> $ </td> <td style="background-color: #cceeff; padding: 0pt; width: 12%; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%;"> </td> <td style="background-color: #cceeff; padding: 0pt; border-bottom: black 1pt solid; width: 1%; vertical-align: bottom;"> $ </td> <td style="background-color: #cceeff; padding: 0pt; border-bottom: black 1pt solid; width: 10%; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Issued </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 147,058 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 4.08 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Exercised </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Expired </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="padding: 0pt; border-bottom: black 1pt solid; vertical-align: bottom;"> — </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> — </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Outstanding at September 30, 2019 </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 147,058 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 4.08 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.25pt double; padding: 0pt; background-color: #cceeff; vertical-align: bottom;"> 224,999 </td> </tr> </table>

147058

4.08

147058

4.08

224999000

NOTE 6 – OTHER LIABILITIES <div> The following is a summary of Notes Payable included in other current liabilities on the Company’s condensed consolidated balance sheet: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;" width="100%"> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> </td> <td> </td> <td colspan="10" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="10" style="padding: 0pt 0pt 0pt 0pt; border-bottom: 1pt solid black; width: 33%;" valign="bottom"> December 31, 2018 </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Current portion, net </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center; width: 8%;" valign="bottom"> Non-current portion, net </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center; width: 8%;" valign="bottom"> Total </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center; width: 8%;" valign="bottom"> Current portion, net </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center; width: 8%;" valign="bottom"> Non-current portion, net </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center; width: 8%;" valign="bottom"> Total </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt 0pt 0pt 0pt; width: 28%;" valign="bottom"> Convertible 5% Notes Payable </td> <td style="width: 2%;"> </td> <td style="border-bottom: 1pt solid black; width: 1%;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black; width: 8%;" valign="bottom"> 95 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 2%;"> </td> <td style="border-bottom: 1pt solid black; width: 1%;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black; width: 8%;" valign="bottom"> — </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 2%;"> </td> <td style="border-bottom: 1pt solid black; width: 1%;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black; width: 8%;" valign="bottom"> 95 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 2%;"> </td> <td style="border-bottom: 1pt solid black; width: 1%;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black; width: 8%;" valign="bottom"> 67 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 2%;"> </td> <td style="width: 1%;" valign="bottom"> $ </td> <td style="width: 8%;" valign="bottom"> — </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 2%;"> </td> <td style="border-bottom: 1pt solid black; width: 1%;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black; width: 8%;" valign="bottom"> 67 </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 67 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 67 </td> </tr> </table> </div> Convertible 5% Notes Payable The 5% Notes and accrued and unpaid interest thereon are convertible at the option of the holder into common stock at the conversion price of $1,125 per share. We have no obligation under the 5% Notes aside from (a) 50% of the net product cash flows from Ariston’s product candidates, if any, payable to noteholders; and (b) the conversion feature, discussed above. Interest accrues monthly, is added to principal on an annual basis, every March 8, and is payable at maturity, which was March 8, 2015 (see Note 4 for further details). The cumulative liability including accrued and unpaid interest of these notes was approximately $19.1 million at September 30, 2019 and $18.4 million at December 31, 2018. No payments have been made on the 5% Notes as of September 30, 2019. In December 2011, we elected the fair value option for valuing the 5% Notes. The fair value option was elected in order to reflect in our financial statements the assumptions that market participants use in evaluating these financial instruments (see Note 4 for further details). Current Liabilities In 2018, we entered into an agreement with a contract manufacturer for the clinical and potential commercial supply of one of our product candidates. As part of this agreement, the contract manufacturer has agreed to defer payment of certain costs and expenses under the agreement in exchange for the payment of an administrative fee. To date we have incurred expenses related to this agreement of approximately $43.0 million as of September 30, 2019, which include both service fees and raw material costs. No payments have been made to the contract manufacturer as of September 30, 2019. Accordingly, as of September 30, 2019, $43.0 million is included in current liabilities in the Company’s unaudited condensed consolidated balance sheet, of which $17.7 million, $4.0 million and $21.3 million are due in the first, second and third quarter of 2020, respectively. As of December 31, 2018, $18.4 million is included in long-term liabilities in the Company’s condensed consolidated balance sheet. We will incur an administrative fee of six percent (6%) per year starting from the date of invoice issuance. For the three and nine months ended September 30, 2019, we have accrued $0.5 million in administrative fees in connection with these costs, which has been included in interest expense in the Company’s unaudited condensed consolidated statements of operations.

The following is a summary of Notes Payable included in other current liabilities on the Company’s condensed consolidated balance sheet: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;" width="100%"> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> </td> <td> </td> <td colspan="10" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="10" style="padding: 0pt 0pt 0pt 0pt; border-bottom: 1pt solid black; width: 33%;" valign="bottom"> December 31, 2018 </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center;" valign="bottom"> Current portion, net </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center; width: 8%;" valign="bottom"> Non-current portion, net </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center; width: 8%;" valign="bottom"> Total </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center; width: 8%;" valign="bottom"> Current portion, net </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center; width: 8%;" valign="bottom"> Non-current portion, net </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 1%;"> </td> <td colspan="2" style="border-bottom: 1pt solid black; text-align: center; width: 8%;" valign="bottom"> Total </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt 0pt 0pt 0pt; width: 28%;" valign="bottom"> Convertible 5% Notes Payable </td> <td style="width: 2%;"> </td> <td style="border-bottom: 1pt solid black; width: 1%;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black; width: 8%;" valign="bottom"> 95 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 2%;"> </td> <td style="border-bottom: 1pt solid black; width: 1%;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black; width: 8%;" valign="bottom"> — </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 2%;"> </td> <td style="border-bottom: 1pt solid black; width: 1%;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black; width: 8%;" valign="bottom"> 95 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 2%;"> </td> <td style="border-bottom: 1pt solid black; width: 1%;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black; width: 8%;" valign="bottom"> 67 </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 2%;"> </td> <td style="width: 1%;" valign="bottom"> $ </td> <td style="width: 8%;" valign="bottom"> — </td> <td style="width: 1%;" valign="bottom"> </td> <td style="width: 2%;"> </td> <td style="border-bottom: 1pt solid black; width: 1%;" valign="bottom"> $ </td> <td style="border-bottom: 1pt solid black; width: 8%;" valign="bottom"> 67 </td> <td style="width: 1%;" valign="bottom"> </td> </tr> <tr> <td style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Total </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 95 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 67 </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> — </td> <td valign="bottom"> </td> <td> </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> $ </td> <td style="border-bottom: 2.5pt double black;" valign="bottom"> 67 </td> </tr> </table>

95000

67000

95000

67000

19100000 18400000 43000000.0 17700000 4000000.0 21300000 18400000 500000

NOTE 7 – LONG-TERM DEBT On February 28, 2019 (the “Closing Date”), the Company (“Borrower”) entered into a term loan facility of up to $60.0 million (“Term Loan”) with Hercules Capital, Inc., (“Hercules”), the proceeds of which will be used for its ongoing research and development programs and for general corporate purposes. The Term Loan is governed by a loan and security agreement, dated February 28, 2019 (the “Loan Agreement”), which provides for up to four separate advances. The first advance of $30.0 million was drawn on the Closing Date. Two additional advances of $10.0 million may be drawn at the Borrower’s option but subject to the clinical trial milestones, and the fourth advance of $10.0 million, available in minimum increments of $5.0 million, is available through December 15, 2020 subject to the approval of Hercules’ investment committee. The Term Loan will mature on March 1, 2022 (the “Loan Maturity Date”). Each advance accrues interest at a per annum rate of interest equal to the greater of either (i) the “prime rate” as reported in The Wall Street Journal plus 4.75%, and (ii) 10.25%. The Term Loan provides for interest-only payments until October 1, 2020. The interest-only period may be extended to April 1, 2021 if the Borrower, on or before September 30, 2020, achieves either the third milestone or the Company has raised at least an amount equal to $150.0 million in unrestricted net cash proceeds from one or more equity financings, subordinated indebtedness and/or upfront proceeds from business development transactions permitted under the Loan Agreement, in each case after February 7, 2019, and prior to September 30, 2020. Thereafter, amortization payments will be payable monthly in eighteen installments (or, if the period requiring interest-only payments has been extended to April 1, 2021, in twelve installments) of principal and interest (subject to recalculation upon a change in prime rates). At its option upon seven business days’ prior written notice to Hercules, the Company may prepay all or any portion greater than or equal to $5.0 million of the outstanding advances by paying the entire principal balance (or portion thereof), all accrued and unpaid interest, subject to a prepayment charge of 3.0%, if such advance is prepaid in any of the first twelve months following the Closing Date, 1.5%, if such advance is prepaid after twelve months following the Closing Date but on or prior to twenty-four months following the Closing Date, and 0% thereafter. In addition, an end of term charge equal to 3.25% of the aggregate principal amount of the loan extended by Hercules is due on the maturity date. Amounts outstanding during an event of default shall be payable on demand and shall accrue interest at an additional rate of 4.0% per annum of the past due amount outstanding. The Term Loan is secured by a lien on substantially all of the assets of the Borrower, other than intellectual property and contains customary covenants and representations, including a liquidity covenant, financial reporting covenant and limitations on dividends, indebtedness, collateral, investments, distributions, transfers, mergers or acquisitions, taxes, corporate changes, deposit accounts, and subsidiaries. As of September 30, 2019, the Company has been in compliance with all covenants. The events of default under the Loan Agreement include, without limitation, and subject to customary grace periods, (1) the Borrower’s failure to make any payments of principal or interest under the Loan Agreement, promissory notes or other loan documents, (2) the Borrower’s breach or default in the performance of any covenant under the Loan Agreement, (3) the occurrence of a material adverse effect, (4) the Borrower making a false or misleading representation or warranty in any material respect, (5) the Borrower’s insolvency or bankruptcy, (6) certain attachments or judgments on the Borrower’s assets, or (7) the occurrence of any material default under certain agreements or obligations of the Borrower involving indebtedness in excess of $750,000. If an event of default occurs, Hercules is entitled to take enforcement action, including acceleration of amounts due under the Loan Agreement. The Loan Agreement also contains warrant coverage of 2% of the total amount funded. A warrant (the “Warrant”) was issued by Borrower to Hercules to purchase 147,058 shares of common stock with an exercise price of $4.08. The Warrant shall be exercisable for seven years from the date of issuance. Hercules may exercise the Warrant either by (a) cash or check or (b) through a net issuance conversion. The shares will be registered and freely tradeable within six months of issuance. The Company accounted for the Warrant as an equity instrument since it was indexed to the Company’s common shares and met the criteria for classification in shareholders’ equity. The relative fair value of the Warrant on the date of issuance was approximately $1.0 million and was treated as an offset to the Term Loan. This amount will be amortized to interest expense using the straight line method, which approximates the effective interest method, over the life of the Term Loan. <div> The Company estimated the fair value of the Warrant using the Black-Scholes model based on the following key assumptions: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="background-color: #cceeff; padding: 0pt; width: 85%; vertical-align: bottom;"> Exercise Price </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%;"> </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> $ </td> <td style="background-color: #cceeff; padding: 0pt; width: 12%; vertical-align: bottom;"> 4.08 </td> <td style="background-color: #cceeff; padding: 0pt; width: 1%; vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Common share price on date of issuance </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> $ </td> <td style="padding: 0pt; vertical-align: bottom;"> 6.80 </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Volatility </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> 195.9 </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> % </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Risk-free interest rate </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 2.63 </td> <td style="padding: 0pt; vertical-align: bottom;"> % </td> </tr> <tr> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> Expected dividend yield </td> <td style="background-color: #cceeff; padding: 0pt;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> — </td> <td style="background-color: #cceeff; padding: 0pt; vertical-align: bottom;"> % </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Contractual term (in years) </td> <td style="padding: 0pt;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td style="padding: 0pt; vertical-align: bottom;"> 7.00 years </td> </tr> </table> </div> The Company incurred financing expenses of $2.8 million related to the Hercules Loan Agreement which are recorded as an offset to long-term debt on the Company’s condensed consolidated balance sheet. The debt issuance costs are being amortized over the term of the debt using the straight-line method, which approximates the effective interest method, and are included in interest expense in the Company’s unaudited condensed consolidated statements of operations. Amortization of debt issuance costs was $0.2 million and $0.5 million for the three and nine months ended September 30, 2019, respectively. At September 30, 2019, the remaining unamortized balance of debt issuance costs were $2.2 million. <div> Long-term debt as of as of September 30, 2019, is as follows (in thousands): <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 85%; vertical-align: bottom;"> Long-term debt </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> $ </td> <td style="vertical-align: bottom; width: 12%;"> 30,000 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> End of term fee </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 975 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 30,975 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Less: unamortized debt issuance costs </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> (2,234 </td> <td style="padding-bottom: 1pt; vertical-align: bottom;"> ) </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 28,741 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Less: Current portion </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> — </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Long-term debt– non-current </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 28,741 </td> </tr> </table> </div>

4.08

1000000.0 The Company estimated the fair value of the Warrant using the Black-Scholes model based on the following key assumptions: Exercise Price $ 4.08 Common share price on date of issuance $ 6.80 Volatility 195.9 % Risk-free interest rate 2.63 % Expected dividend yield — % Contractual term (in years) 7.00 years

4.08

6.80

1.959

0.0263

P7Y

2800000

200000

500000

Long-term debt as of as of September 30, 2019, is as follows (in thousands): <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 85%; vertical-align: bottom;"> Long-term debt </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> $ </td> <td style="vertical-align: bottom; width: 12%;"> 30,000 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> End of term fee </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 975 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 30,975 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Less: unamortized debt issuance costs </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> (2,234 </td> <td style="padding-bottom: 1pt; vertical-align: bottom;"> ) </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 28,741 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Less: Current portion </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> — </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Long-term debt– non-current </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 28,741 </td> </tr> </table>

30000000

975000 30975000

-2234000

28741000

NOTE 8 – LEASES In October 2014, we entered into an agreement (the “Office Agreement”) with Fortress Biotech, Inc. (“FBIO”) to occupy approximately 45% of the 24,000 square feet of New York City office space leased by FBIO, which is now our corporate headquarters. The Office Agreement requires us to pay our respective share of the average annual rent and other costs of the 15-year lease. We approximate an average annual rental obligation of $1.1 million under the Office Agreement. We began to occupy this new space in April 2016, with rental payments beginning in the third quarter of 2016. At January 1, 2019 we recognized a lease liability and corresponding Right of Use (ROU) asset based on the present value of the remaining lease payments for all of our leased office spaces, the majority of which is comprised of our New York City office space. The present values of our lease liability and corresponding ROU asset are $10.7 million and $8.5 million, respectively, as of September 30, 2019. Our leases have remaining lease terms of 1 year to 12 years. One lease has a renewal option to extend the lease for an additional term of 2 years. The initial commitment period of the 45% rate is for a period of three (3) years. We and FBIO currently determine actual office space utilization annually and if our utilization differs from the amount we have been billed, we will either receive credits or be assessed incremental utilization charges. Also in connection with this lease, in October 2014 we pledged $0.6 million to secure a line of credit as a security deposit for the Office Agreement, which has been recorded as restricted cash in the accompanying consolidated balance sheets. Additional collateral of $0.6 million was pledged in April 2018 to increase the letter of credit for the office space. <div> The following components of lease expense are included in the Company’s condensed consolidated statements of operations for the three and nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td colspan="2" valign="top"> Three months ended, </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Nine months ended, </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="top"> September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt; border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%; vertical-align: bottom;"> Operating lease cost </td> <td style="width: 1%;"> </td> <td style="border-bottom: black 1pt solid; width: 1%; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 1pt solid; width: 12%; vertical-align: bottom;"> 1,065 </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="width: 1%;"> </td> <td style="border-bottom: black 1pt solid; width: 1%; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 1pt solid; width: 12%; vertical-align: bottom;"> 2,058 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Net lease cost </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 1,065 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 2,058 </td> </tr> </table> </div> As of September 30, 2019, the weighted-average remaining operating lease term was 9.5 years and the weighted-average discount rate for operating leases was 10.25%. Cash paid for amounts included in the measurement of operating lease liabilities during the nine months ended September 30, 2019 was $1.1 million. <div> The balance sheet classification of lease liabilities was as follows: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 85%; vertical-align: bottom;"> Liabilities </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="vertical-align: bottom; width: 12%;"> </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr style="background-color: white;"> <td style="padding: 0pt; vertical-align: bottom;"> Lease liability – current portion </td> <td> </td> <td style="vertical-align: bottom;"> $ </td> <td style="vertical-align: bottom;"> 1,365 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Lease liability – non-current </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 9,380 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: white;"> <td style="padding: 0pt; vertical-align: bottom;"> Total lease liability </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 10,745 </td> </tr> </table> </div> <div> As of September 30, 2019, the maturities of lease liabilities were as follows: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> Operating leases </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 85%; vertical-align: bottom;"> Remainder of 2019 </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> $ </td> <td style="vertical-align: bottom; width: 12%;"> 393 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> 2020 </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1,551 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> 2021 </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1,560 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> 2022 </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1,586 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> 2023 </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1,581 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> After 2023 </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 12,061 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Total lease payments </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 18,732 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Less: Interest </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> (7,987 </td> <td style="padding-bottom: 1pt; vertical-align: bottom;"> ) </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Present value of lease liabilities(*) </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 10,745 </td> </tr> </table> </div> (*) As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date and considering the term of the lease to determine the present value of lease payments. We used the incremental borrowing rate of 10.25% on February 28, 2019, for operating leases that commenced prior to that date.

0.45

24000

P15Y 1100000

10700000

8500000

600000

The following components of lease expense are included in the Company’s condensed consolidated statements of operations for the three and nine months ended September 30, 2019: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> </td> <td> </td> <td colspan="2" valign="top"> Three months ended, </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt;" valign="bottom"> Nine months ended, </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="top"> September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td colspan="2" style="padding: 0pt 0pt 0pt 0pt; border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 70%; vertical-align: bottom;"> Operating lease cost </td> <td style="width: 1%;"> </td> <td style="border-bottom: black 1pt solid; width: 1%; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 1pt solid; width: 12%; vertical-align: bottom;"> 1,065 </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="width: 1%;"> </td> <td style="border-bottom: black 1pt solid; width: 1%; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 1pt solid; width: 12%; vertical-align: bottom;"> 2,058 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Net lease cost </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 1,065 </td> <td style="vertical-align: bottom;"> </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 2,058 </td> </tr> </table>

1065000

2058000

1065000

2058000

P9Y6M

10.25

The balance sheet classification of lease liabilities was as follows: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> September 30, 2019 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 85%; vertical-align: bottom;"> Liabilities </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> </td> <td style="vertical-align: bottom; width: 12%;"> </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr style="background-color: white;"> <td style="padding: 0pt; vertical-align: bottom;"> Lease liability – current portion </td> <td> </td> <td style="vertical-align: bottom;"> $ </td> <td style="vertical-align: bottom;"> 1,365 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Lease liability – non-current </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 9,380 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: white;"> <td style="padding: 0pt; vertical-align: bottom;"> Total lease liability </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 10,745 </td> </tr> </table>

1365000

9380000

10745000

As of September 30, 2019, the maturities of lease liabilities were as follows: <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%;"> <tr> <td style="padding: 0pt; vertical-align: bottom;"> (in thousands) </td> <td> </td> <td colspan="2" style="border-bottom: 1pt solid black;" valign="bottom"> Operating leases </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; width: 85%; vertical-align: bottom;"> Remainder of 2019 </td> <td style="width: 1%;"> </td> <td style="vertical-align: bottom; width: 1%;"> $ </td> <td style="vertical-align: bottom; width: 12%;"> 393 </td> <td style="vertical-align: bottom; width: 1%;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> 2020 </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1,551 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> 2021 </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1,560 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> 2022 </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1,586 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> 2023 </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 1,581 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> After 2023 </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> 12,061 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Total lease payments </td> <td> </td> <td style="vertical-align: bottom;"> </td> <td style="vertical-align: bottom;"> 18,732 </td> <td style="vertical-align: bottom;"> </td> </tr> <tr> <td style="padding: 0pt; vertical-align: bottom;"> Less: Interest </td> <td> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> </td> <td style="border-bottom: black 1pt solid; vertical-align: bottom;"> (7,987 </td> <td style="padding-bottom: 1pt; vertical-align: bottom;"> ) </td> </tr> <tr style="background-color: #cceeff;"> <td style="padding: 0pt; vertical-align: bottom;"> Present value of lease liabilities(*) </td> <td> </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> $ </td> <td style="border-bottom: black 2.5pt double; vertical-align: bottom;"> 10,745 </td> </tr> </table>

393000

1551000

1560000

1586000

1581000

12061000

18732000

-7987000

10745000

NOTE 9 – LICENSE AGREEMENTS TG-1101 (Ublituximab) In November 2012, we entered into an exclusive (within the territory) sublicense agreement with Ildong Pharmaceutical Co. Ltd. (“Ildong”) relating to the development and commercialization of ublituximab in South Korea and Southeast Asia. Under the terms of the sublicense agreement, Ildong has been granted a royalty bearing, exclusive right, including the right to grant sublicenses, to develop and commercialize ublituximab in South Korea, Taiwan, Singapore, Indonesia, Malaysia, Thailand, Philippines, Vietnam, and Myanmar. An upfront payment of $2.0 million, which was received in December 2012, net of $0.3 million of income tax withholdings, is being recognized as license revenue on a straight-line basis over the life of the agreement, which is through the expiration of the last licensed patent right or 15 years after the first commercial sale of a product in such country, unless the agreement is earlier terminated, and represents the estimated period over which we will have certain ongoing responsibilities under the sublicense agreement. We recorded license revenue of approximately $38,000 for each of the three months ended September 30, 2019 and 2018, and $114,000 for each of the nine months ended September 30, 2019 and 2018 and, at September 30, 2019 and December 31, 2018, have deferred revenue of approximately $1.0 million and $1.1 million, respectively, associated with this $2 million payment (approximately $152,000 of which has been classified in current liabilities at September 30, 2019 and December 31, 2018). We may receive up to an additional $5.0 million in payments upon the achievement of pre-specified milestones. In addition, upon commercialization, Ildong will make royalty payments to us on net sales of ublituximab in the sublicense territory. TG-1701: BTK In January 2018, we entered into a global exclusive license agreement with Jiangsu Hengrui Medicine Co. (“Hengrui”), to acquire worldwide intellectual property rights, excluding Asia but including Japan, and for the research, development, manufacturing, and commercialization of products containing or comprising of any of Hengrui’s Bruton’s Tyrosine Kinase inhibitors containing the compounds of either TG-1701 (SHR1459 or EBI1459) or TG1702 (SHR1266 or EBI1266). Pursuant to the agreement, in April 2018, we paid Jiangsu an upfront fee of $1.0 million in our common stock recorded to noncash stock expense associated with in-licensing agreements in our condensed consolidated statement of operations. In addition, in July 2019, we paid Jiangsu the first milestone of $0.1 million in our common stock recorded to noncash stock expense associated with in-licensing agreements in our consolidated statement of operations. Jiangsu is eligible to receive milestone payments totaling approximately $350 million upon and subject to the achievement of certain milestones. Various provisions allow for payments in conjunction with the agreement to be made in cash or our common stock, while others limit the form of payment. Royalty payments in the low double digits are due on net sales of licensed products and revenue from sublicenses. TG-1801: anti-CD47/anti-CD19 In June 2018, we entered into a Joint Venture and License Option Agreement with Novimmune SA (“Novimmune”) to collaborate on the development and commercialization of Novimmune’s novel first-in-class anti-CD47/anti-CD19 bispecific antibody known as TG-1801 (previously NI-1701). The companies will jointly develop the product on a worldwide basis, focusing on indications in the area of hematologic B-cell malignancies. We serve as the primary responsible party for the development, manufacturing and commercialization of the product. Pursuant to the agreement, in June 2018 we paid Novimmune an upfront payment of $3.0 million in our common stock recorded to noncash stock expense associated with in-licensing agreements in our consolidated statement of operations. Further milestone payments will be paid based on early clinical development, and the Company will be responsible for the costs of clinical development of the product through the end of the Phase 2 clinical trials, after which the Company and Novimmune will be jointly responsible for all development and commercialization costs. The Company and Novimmune will each maintain an exclusive option, exercisable at specific times during development, for the Company to license the rights to TG-1801, in which case Novimmune is eligible to receive additional milestone payments totaling approximately $185 million as well as tiered royalties on net sales in the high single to low double digits upon and subject to the achievement of certain milestones. 2000000.0

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NOTE 10 – RELATED PARTY TRANSACTIONS <p style="font: 10pt 'Times New Roman', Times, serif; text-align: justify; text-indent: 27pt; background-image: initial; background-position: initial; background-size: initial; background-repeat: initial; background-attachment: initial; background-origin: initial; background-clip: initial; margin: 0pt;">In October 2014, we entered into an agreement (the “Office Agreement”) with Fortress Biotech, Inc. (“FBIO”), to occupy approximately 45% of the 24,000 square feet of New York City office space leased by FBIO, which is now our corporate headquarters. The Office Agreement requires us to pay our respective share of the average annual rent and other costs of the 15-year lease. We approximate an average annual rental obligation of $1.1 million under the Office Agreement. We began to occupy this new space in April 2016, with rental payments beginning in the third quarter of 2016. At January 1, 2019, we recognized a lease liability of $9.3 million, with a corresponding Right of Use (ROU) asset of $7.7 million based on the present value of the remaining lease payments for all of our leased office spaces, the majority of which is comprised of our New York City office space. Mr. Weiss, our Executive Chairman and CEO, is also Executive Vice Chairman of FBIO. Under the Office Agreement, we agreed to pay FBIO our portion of the build out costs, which have been allocated to us at the 45% rate mentioned above. The allocated build-out costs have been recorded in Leasehold Interest, net on the Company’s condensed consolidated balance sheets and will be amortized over the 15-year term of the Office Agreement. The initial commitment period of the 45% rate is for a period of three (3) years. We and FBIO currently determine actual office space utilization annually and if our utilization differs from the amount we have been billed, we will either receive credits or be assessed incremental utilization charges. Also, in connection with this lease, in October 2014 we pledged $0.6 million to secure a line of credit as a security deposit for the Office Agreement, which has been recorded as restricted cash in the accompanying consolidated balance sheets. Additional collateral of $0.6 million was pledged in April 2018 to increase the letter of credit for the office space. <p style="font: 10pt 'Times New Roman', Times, serif; text-indent: 27pt; background-image: initial; background-position: initial; background-size: initial; background-repeat: initial; background-attachment: initial; background-origin: initial; background-clip: initial; margin: 0pt;">In July 2015, we entered into a Shared Services Agreement (the “Shared Services Agreement”) with FBIO to share the cost of certain services such as facilities use, personnel costs and other overhead and administrative costs. This Shared Services Agreement requires us to pay our respective share of services utilized. In connection with the Shared Services Agreement, we incurred expenses of approximately $0.6 million and $1.4 million for shared services for the nine months ended September 30, 2019 and 2018, respectively, and expenses of approximately $0.2 million for each of the three months ended September 30, 2019 and 2018, primarily related to shared personnel. In March 2015, we entered into a Global Collaboration Agreement (“Collaboration Agreement”) with Checkpoint for the development and commercialization of anti-PD-L1 and anti-GITR antibody research programs in the field of hematological malignancies. The Collaboration Agreement was amended in June 2019 and upon execution of the amendment we incurred an upfront fee of $1.0 million. We incurred expenses of approximately $4.0 million and $0.5 million for the nine months ended September 30, 2019 and 2018, respectively, and expenses of approximately $2.7 million and $0.1 million for the three months ended September 30, 2019 and 2018, the majority of which relates to manufacturing expenses of PD-L1. The relevant expenses are recorded in other research and development in the accompanying condensed consolidated statement of operations.

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NOTE 11 – SUBSEQUENT EVENTS In October 2019, we finalized a five-year lease for office space in New Jersey (the “NJ Lease”). We approximate an average annual rental obligation of $0.3 million under the NJ Lease. We began to occupy this new space in October 2019, with rental payments beginning in November 2019.

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