AADI BIOSCIENCE, INC. The following discussion of our financial condition and results of operations of
Overview
We are a biopharmaceutical company focused on developing and commercializing precision therapies for genetically defined cancers with alterations in mTOR pathway genes. Our lead drug product, FYARRO, nab-sirolimus, (sirolimus protein-bound particles for injectable suspension (albumin-bound)), is a form of sirolimus bound to albumin. Sirolimus is a potent inhibitor of the mTOR biological pathway, the activation of which pathway can promote tumor growth, and inhibits downstream signaling from mTOR.
In
In
In addition to advanced malignant PEComa, based on data from the completed
AMPECT trial and our expanded access program, we have initiated a
registration-directed tumor-agnostic Phase 2 study ("PRECISION 1") of FYARRO in
patients with
For more information regarding our business, including FYARRO, the AMPECT trial and the PRECISION 1 trial, see Part I, Item 1 (Business).
For the fiscal year ended
• On May 16, 2021 , at which time we were operating as "Aerpio
Pharmaceuticals, Inc. ," we entered into: (i) an Agreement and Plan of
Merger ("Merger Agreement") with Aspen Merger Subsidiary, Inc. , our
wholly-owned subsidiary ("Merger Sub"), and Aadi Subsidiary, Inc.
(formerly known as Aadi Bioscience, Inc. ("Private Aadi")); and (ii) a
subscription agreement ("Subscription Agreement") with certain investors
(the "PIPE Investors "), pursuant to which we agreed to sell shares of our
common stock to the PIPE Investors concurrently with the closing of the
Merger (as defined below) (the "PIPE Financing"). See Note 1 to our
audited financial statements for more information about the Merger
Agreement and the Subscription Agreement.
• On August 26, 2021 , pursuant to the terms of the Merger Agreement and the
Subscription Agreement:
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o Merger Sub merged with and into Private Aadi, with Private Aadi
surviving as our wholly-owned subsidiary (the "Merger");
o in connection with and immediately prior to the Merger, we effected
a reverse stock split of our common stock at a ratio of 15:1 and
changed our name from "Aerpio Pharmaceuticals, Inc. " to "Aadi
Bioscience, Inc ";
o at the effective time of the Merger, based on an exchange ratio of
0.3172 (after taking into account the Reverse Stock Split), as
calculated under the Merger Agreement (the "Exchange Ratio"), we
issued an aggregate of 5,776,660 shares of common stock to the
holders of Private Aadi common stock immediately prior to the
Merger, including shares of Private Aadi common stock issuable upon
the conversion of all shares of preferred stock and convertible
promissory notes outstanding immediately prior to the Effective
Time;
o at the closing of the Merger, we assumed all of the outstanding and
unexercised options to purchase shares of Private Aadi common stock,
which options were converted into options to purchase shares of our
common stock, as adjusted pursuant to the Merger Agreement based on
the Exchange Ratio;
o concurrently with the Closing of the Merger, we issued and sold
11,852,862 shares of common stock to the PIPE Investors for total
gross proceeds of $155 million and, immediately after the closing of
the Merger and the PIPE Financing, the PIPE Investors and the
Private Aadi investors as of immediately prior to the effective time
of the Merger owned 55.6% and 29.2%, respectively, of our
outstanding common stock on a fully-diluted basis; and
o we entered into a contingent value rights agreement ("CVR
Agreement") pursuant to which each of our stockholders as of
immediately prior to the effective time of the Merger became
entitled to certain contingent value rights entitling them to
receive 90% of the net proceeds (calculated as gross consideration
minus certain permitted deductions), if any, received by us under
the license agreement, dated June 24, 2018 , with Gossamer Bio, Inc.,
as amended, and certain other covered agreements, as specified in
the CVR Agreement (see Note 1 to our audited financial statements
for more information about the CVR Agreement).
Celgene License Agreement
In
Under the terms of an
EOC License Agreement
In
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In accordance with the Celgene License Agreement, we are required to pay 20% of
all sublicense fees to Celgene. As such, we recognized
During the fourth quarter of 2021, we recognized license revenue and received
Key Trends and Factors Affecting Comparability Between Periods
• Following FDA approval in November 2021 , we have been actively engaged in
commercial preparations to support the U.S. launch of FYARRO for the
treatment of patients with advanced malignant PEComa. We have built a
cross-functional commercial team consisting of marketing, market access,
commercial operations, and sales to support our launch and are building a
commercial infrastructure with capabilities designed to scale when
necessary to support future commercial launches. Expenses related to our
commercial launch including personnel expenses, sales support, and
marketing are included in general and administrative expenses for the year
ended December 31, 2021 . We expect these expenses will continue to
increase as we launch FYARRO and support future launches.
• We expect that our research and development costs will increase in 2022
relative to 2021 as a result of anticipated significant expenses related
to the PRECISION 1 trial.
• Following the Merger, we have incurred, and expect to continue to incur,
significant additional expenses associated with being a public company
that we did not incur as a privately-held company, including (i) costs to
comply with the rules and regulations of the SEC and those of Nasdaq, (ii)
legal, accounting and other professional services, (iii) insurance, (iv)
investor relations activities and (v) other administrative and
professional services.
• We accounted for the Merger as a reverse asset acquisition because
substantially all of the fair value was concentrated in cash, working
capital, and a long-lived contract intangible asset. Due to the
significant excess purchase price being allocated over the fair value of
the acquired contract intangible asset, we determined that an indicator of
impairment was present and recognized in 2021 a non-cash impairment charge
of $74.2 million , to bring the carrying amount of the contract intangible
asset down to its estimated fair value of $3.9 million . The intangible
asset is being amortized over the life of the underlying asset, 14.3
years.
• The COVID-19 pandemic has resulted, and is likely to continue to result
in, significant national and global economic disruption and may adversely
affect our operations. Our clinical trials have been, and may continue to
be, affected by the closure of offices, lack of resources or closure of
borders, among other measures being put in place around the world. The
inability to travel and conduct face-to-face meetings, as well as
constraints surrounding hospital infrastructure and staff, can also make
it more difficult to enroll and maintain patients in ongoing or planned
clinical trials. We are actively monitoring the impact of COVID-19 and the
possible effects on our financial condition, liquidity, operations,
suppliers, industry and workforce. However, the full extent, consequences
and duration of the COVID-19 pandemic and the resulting impact on us
cannot currently be predicted. We will continue to evaluate the impact
that these events could have on our operations, financial position,
results of operations and cash flows in fiscal year 2022.
Liquidity and Capital Resources
We have incurred net losses in each year since inception and as of
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Key Management Changes
Upon the closing of the Merger,
Basis of Presentation
The following discussion highlights our results of operations and the principal
factors that have affected our financial condition as well as our liquidity and
capital resources for the periods described and provides information that
management believes is relevant for an assessment and understanding of the
consolidated balance sheets and statements of operation and comprehensive loss
presented herein. The following discussion and analysis are based on our
consolidated financial statements contained in this Annual Report, which we have
prepared in accordance with
Components of Statements of Operations and Comprehensive Loss
Revenue
EOC Pharma License Revenue
In
Unless earlier terminated, the EOC License Agreement will remain in effect until all milestones are achieved and royalty payment obligations are fulfilled as provided for in the EOC License Agreement. Prior to the expiration of the EOC License Agreement, EOC has the right to terminate the agreement for any reason upon a specified number of days advance written notice. Either party may terminate the EOC License Agreement in the event that the other party materially breaches the agreement and fails to cure the breach, or experiences certain events of financial distress. We may terminate the EOC License Agreement if EOC or its affiliates challenge the licensed patents in a legal, administrative or arbitration proceeding.
In
We assessed the EOC License Agreement and concluded that EOC is a customer.
Additionally, we identified the license of FYARRO provided to EOC as the sole
performance obligation. The
Both the milestones and royalty payments under the EOC License Agreement are considered variable consideration and, with respect to revenue recognition, are constrained until we receive notification from EOC that the milestones and royalty payments have been achieved.
Grant Revenue
Grant revenue is derived from federal grants, primarily with the FDA. We have determined that the government agencies providing grants to us are not customers. Grant revenue is recognized when there is reasonable assurance of compliance with the conditions of the grant and reasonable assurance that the grant revenue will be received. We recognize grant revenue as reimbursable grant costs are incurred. The costs associated with these reimbursements are reflected as a component of research and development expense in the accompanying statements of operations and comprehensive loss.
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With respect to grant revenue derived from reimbursement of direct out-of-pocket expenses for research costs associated with federal contracts, where we act as principal with discretion to choose suppliers, bear credit risk and perform part of the services required in the transaction, we record revenue for the gross amount of the reimbursement. The costs associated with these reimbursements are reflected as a component of research and development expense in the accompanying statements of operations and comprehensive loss.
Operating Expenses
Research and Development Expenses
Research and development expenses, which consist primarily of costs associated with our product research and development efforts, are expensed as incurred. Research and development expenses consist primarily of: (i) employee related costs, including salaries, benefits and stock-based compensation expense for employees engaged in scientific research and development functions; (ii) third-party contract costs relating to research, formulation, manufacturing, nonclinical studies and clinical trial activities; (iii) external costs of outside consultants who assist with technology development, regulatory affairs, clinical development and quality assurance; (iv) payments made under our third-party licensing agreements; and (v) allocated facility-related costs.
Costs for certain activities, such as manufacturing, nonclinical studies and clinical trials are generally recognized based on the evaluation of the progress of completion of specific tasks using information and data provided by our vendors and collaborators. Research and development activities are central to our business. We expect to increase our investment in research and development in order to advance our product candidates through clinical trials. As a result, we expect that our research and development expenses will increase substantially in the foreseeable future as we continue to invest in research and development activities, pursue clinical development of our product candidates and expand our product candidate pipeline.
The process of commercialization and conducting the necessary preclinical and clinical research to obtain regulatory approval is costly and time-consuming. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. Accordingly, to the extent that our product candidates continue to advance into clinical trials, including larger and later-stage clinical trials, our expenses will increase substantially and may become more variable.
General and Administrative Expenses
General and administrative expenses consist primarily of salaries and related
benefits, including stock-based compensation, related to our executive, finance,
business development, sales and marketing, and other corporate functions. Other
general and administrative expenses include professional fees for legal,
auditing, tax and business consulting services, insurance costs, intellectual
property and patent costs, facility costs and travel costs. We expect that
general and administrative expenses will increase in the future as we expand our
operating activities. Additionally, we will incur significant additional
expenses associated with being a public company that we did not incur as a
privately-held company, including (i) costs to comply with the rules and
regulations of the
Impairment of Acquired Contract Intangible Asset
Impairment of acquired contract intangible asset relates to a write down of the
acquired contract intangible asset to fair value. The contract intangible asset
was assessed for recoverability using an undiscounted cash flow model, which
resulted in undiscounted cash flows below the carrying amount. We recognized an
impairment of
Other Income (Expense), Net
Other income (expense) consists of the change in fair value of convertible promissory notes and interest expense related to such notes. These expenses are partially offset by interest income earned on cash and cash equivalents and gain on extinguishment of debt.
Income Taxes
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During the years ending
Results of Consolidated Operations
The following table presents the results of operations for the periods indicated
(amounts in thousands):
Years Ended December 31,
2021 2020
Revenue
License revenue $ 1,000 $ 14,000
Grant revenue 120 580
Total revenue 1,120 $ 14,580
Operating expenses
Research and development 19,670 15,008
General and administrative 18,511 2,121
Impairment of acquired contract intangible asset 74,156 -
Total operating expenses 112,337 17,129
Loss from operations (111,217 ) (2,549 )
Other income (expense), net 1,129 (927 )
Loss before income taxes (110,088 ) (3,476 )
Income tax expense (2 ) (2 )
Net and comprehensive loss $ (110,090 ) $ (3,478 ) Comparison of Years Ended
License Revenue
License revenue for the years ended
During the year ended
Grant Revenue
Grant revenue amounts can vary from period to period depending on the funding
and work performed. Grant revenue decreased by
Operating Expenses
Research and Development Expenses
The following table presents our research and development expenses for the periods indicated (amounts in thousands):
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Years Ended December 31,
2021 2020
Clinical drug product manufacturing expense
6,697 5,282
License fee 200 2,800
Personnel and other expenses 6,119 3,123
Total research and development expense
Research and development expenses for the year ended
General and Administrative Expenses
General and administrative expenses for the year ended
The increase was primarily driven by the following in support of our increased headcount, preparation of our commercial launch and expenses related to being a public company. We expect these expenses to continue to increase as we commercialize FYARRO and future launches:
• $2.8 in personnel related expenses due to increased headcount, incentive
bonuses and share-based compensation. Sales and administrative headcount
increased to 17 employees at December 31, 2021 from two employees at
December 31, 2020 ;
• $2.0 million of compensation related expenses to former Aerpio executives
related to the Merger;
• $3.6 million of consulting expenses to support the growth of the
organization;
• $5.4 million of commercialization readiness and marketing expenses;
• and $2.6 million of legal, insurance and other office related expenses.
Impairment of Acquired Contract Intangible Asset
During the year ended
Other Income (Expense), Net
The following table sets forth our other income (expense), net:
Years Ended December 31,
2021 2020
Change in fair value of convertible promissory notes
196 -
Interest income 13 41
Interest expense (665 ) (815 )
Total other income (expense) $ 1,129 $ (927 )
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Other income (expense), net for the year ended
Liquidity and Capital Resources
We have incurred net losses in each year since inception and as of
From inception through
The following table summarizes our cash flows for the years presented:
Year Ended December 31,
2021 2020
Net cash used in operating activities $ (22,423 ) $ (12,701 )
Net cash provided by investing activities 25,153 -
Net cash provided by financing activities 141,804 1,194
Net increase (decrease) in cash and cash equivalents
Operating Activities
Our net cash used in operating activities primarily results from our net loss adjusted for non-cash expenses, changes in working capital components, amounts due to contract research organizations to conduct our clinical programs and employee-related expenditures for research and development and general and administrative activities. Our cash flows from operating activities will continue to be affected by spending to advance and support our product candidates in the clinic and other operating and general administrative activities, including operating as a public company.
For the year ended
For the year ended
Investing Activities
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Cash provided by investing activities for the year ended
Financing Activities
Cash provided by financing activities for the year ended
Contractual Obligations and Commitments
In
On
On
On
We also have contracts with various organizations to conduct research and development activities, including clinical trial organizations to manage clinical trial activities and manufacturing companies to manufacture the drug product used in the clinical trials. The scope of the services under these research and development contracts can be modified and the contracts cancelled by us upon written notice. In the event of a cancellation, we would be liable for the cost and expenses incurred to date as well as any close out costs of the service arrangement.
With respect to our obligations under the CVR Agreement, certain events specified in the CVR Agreement need to occur for us to receive funds, and it is currently uncertain whether any funds will be received under the CVR Agreement. We do not have any commitment or obligation under the CVR Agreement unless and until funds are received.
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Critical Accounting Policies and Estimates
Our management's discussion and analysis of financial position and results of consolidated operations are based on consolidated financial statements prepared in accordance with GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, expenses and related disclosures. On an ongoing basis, we evaluate our estimates and judgments, including those related to prepaid and accrued research and development expenses, revenue recognition and stock-based compensation. We base our estimates on historical experience, known trends and events, and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
While our significant accounting policies are described in more detail in the notes to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K, we believe the following accounting policies to be most critical to the judgments and estimates used in the preparation of our consolidated financial statements.
Merger and Acquired Contractual Intangible Asset
Aerpio issued common stock in the Merger based on the terms of the Merger
Agreement. For accounting purposes, however, we concluded under GAAP that
Private Aadi has acquired Aerpio. We based this conclusion having evaluated the
terms of the Merger Agreement and other factors including: (i) the stockholders
of Private Aadi owned approximately 66.8% of the voting rights of the Company as
of immediately following the Merger (but prior to the PIPE Financing);
(ii) three (3) of seven (7) members of the board of directors of the Company
post-Merger were composed of directors designated by Private Aadi under the
terms of the Merger Agreement, and one (1) member of the board of directors of
the Company post-Merger was a director mutually designated by Private Aadi and
Aerpio; (iii) existing members of Private Aadi's management became the
management of the Company post-Merger; (iv) the
Further, under GAAP we have accounted for the Merger as a reverse asset acquisition rather than a business combination. Accounting as an asset acquisition is significantly different than the accounting for a merger transaction as a business combination. Among other things, we have not recognized any goodwill on our consolidated balance sheet as there may have been had the Merger been accounted for as a business combination. A central element to the accounting model conclusion is the determination of whether a business or an asset or a group of assets is acquired. A business is defined in ASC 805, Business Combinations, as an integrated set of inputs and processes that are capable of generating outputs that have the ability to provide a return to its investors or owners. Typical inputs include long-lived assets (including intangible assets or rights to use long-lived assets), intellectual property and the ability to obtain access to required resources. Typical processes include strategic, operational and resource management processes that are typically documented or evident through an organized workforce. We considered all of the above factors when determining whether a business was acquired in the Merger and concluded that Aerpio did not meet the definition of a business.
Upon closing of the Merger, substantially all of the fair value is concentrated
in cash, working capital and a long-lived contract intangible asset related to
Aerpio's license agreement with Gossamer Bio. Inc., under which 90% of any
future net cash proceeds will be remitted to CVR Holders and paid through the
CVRs. In accordance with GAAP for asset acquisitions, the excess purchase price
over the fair value of the acquired assets and liabilities (
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The license agreement with Gossamer Bio. Inc. includes potential payments to us
in the event of certain development and commercialization milestones and
sales-based royalties. Our fair value determination of the intangible asset
utilized a scenario-based, risk-adjusted, discounted cash flow model with
respect to the potential development milestone payments and a
• We determined fair value of the potential development milestone payments
under the license agreement with inputs based on certain subjective
assumptions, including (a) the probability of clinical success determined
with reference to various academic studies reporting probabilities of
approval for clinical trials; (b) an estimate of the time to achievement
of the clinical milestones; and (c) a counterparty credit risk premium
determined with reference to the borrowing costs of a benchmark group of
comparable market participants.
• Application of the Monte Carlo simulation model in valuing the potential
sales-based milestone and royalties involves making assumptions for (a)
the probability of clinical success determined with reference to various
academic studies reporting probabilities of approval for clinical trials;
(b) our forecast of potential revenues, revenue uptake rate and the period
of time from a prospective commercial launch to peak sales, and an
estimate of peak sales for each successfully commercialized product
covered under the license agreement; (c) drift equal to the risk free rate
on revenues following a multivariate Geometric Brownian Motion; (d) a
counterparty credit risk premium determined with reference to the
borrowing costs of a benchmark group of comparable market participants;
and (e) a revenue metric risk premium determined with reference to a
long-term risk-free rate, a weighted-average cost of capital, revenue
volatility and asset volatility.
Research and Development Costs
We incur substantial expenses associated with clinical trials. Accounting for clinical trials relating to activities performed by CROs and other external vendors requires us to exercise significant estimates in regard to the timing and accounting for these expenses. We estimate costs of research and development activities conducted by service providers, which include, the conduct of preclinical studies, contract manufacturing activities and clinical activities. The diverse nature of services being provided under CRO and other vendor arrangements, the different terms and milestone arrangements that exist for each type of service and the lack of timely information related to certain clinical activities complicates the estimation of accruals for services rendered by CROs and other vendors in connection with clinical trials. We record the estimated costs of research and development activities based upon the estimated amount of services provided but not yet invoiced and include these costs in the accrued and other current liabilities or prepaid expenses, as applicable, on the balance sheets and within research and development expense on the consolidated statements of operations. In estimating the duration of a clinical study, we evaluate the start-up, treatment and wrap-up periods, payment arrangements and services rendered attributable to each clinical trial and fluctuations are regularly tested against payment plans and trial completion assumptions.
We estimate these costs based on factors such as estimates of the work completed and budget provided and in accordance with agreements established with our collaboration partners and third-party service providers. We make significant judgments and estimates in determining the accrued liabilities and prepaid expense balances in each reporting period. As actual costs become known, we adjust our estimates and related accounts on the balance sheet. We have not experienced any material differences between accrued costs and actual costs incurred since our inception.
Our expenses related to clinical trials are based on estimates of patient enrollment and related expenses at clinical investigator sites as well as estimates for the services received and efforts expended pursuant to contracts with multiple research institutions and CROs that may be used to conduct and manage clinical trials on our behalf. We generally accrue expenses related to clinical trials based on contracted amounts applied to the level of patient enrollment and activity. If timelines or contracts are modified based upon changes in the clinical trial protocol or scope of work to be performed, we modify our estimates of accrued expenses accordingly on a prospective basis.
Revenue Recognition
We account for revenue related to the EOC License Agreement and Grant Revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers ("ASC 606"). Under ASC 606, we recognize revenue when the defined customer, under ASC 606, transfers promised goods or services in an amount that reflects the consideration
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to which we expect to be entitled in exchange for goods or services. To determine revenue recognition for contracts with customers, we perform the following five steps: (i) identify the promised goods or services in the contract; (ii) identify the performance obligation in the contract, including whether they are distinct in the context of the contract; (iii) determine the transaction price, including the constraint on variable consideration; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy the performance obligation. We recognize revenue when our customer obtains control of promised goods or services in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. We only apply the five-step model to contracts when it is probable that we will collect consideration to which we are entitled in exchange for the goods or services we transfer to the customer.
StockBased Compensation
We recognize all stock-based payments to employees, including grants of employee
stock options in the consolidated statements of operations and comprehensive
loss based on their fair values. All of our share-based awards, to employees,
non-employees, officers, and directors, are subject only to service-based
vesting conditions. We estimate the fair value of its stock-based awards using
the Black-Scholes option pricing model, which requires the input of assumptions,
including (i) the expected stock price volatility, (ii) the calculation of
expected term of the award, (iii) the risk-free interest rate based on the
Due to the historical lack of a public market for the trading of our common stock and a lack of company-specific historical and implied volatility data, we have based our estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. The computation of expected volatility is based on the historical volatility of a representative group of companies with similar characteristics to ours, including stage of product development and life science industry focus. We believe the group selected has sufficient similar economic and industry characteristics and includes companies that are most representative of us.
We have limited historical stock option activity and therefore estimate the expected term of stock options granted to employees, officers, and directors using the simplified method, which represent the average of the contractual term of the stock option and its weighted-average vesting period, to calculate the expected term, as we do not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term for options granted to employees, and utilize the contractual term for options granted to non-employees. The expected term is applied to the stock option grant group as a whole, as we do not expect substantially different exercise or post-vesting termination behavior among our employee population.
Compensation expense related to awards to employees is calculated on a
straight-line basis by recognizing the grant date fair value over the associated
service period of the award, which is generally the vesting term. For the years
ended
Year Ended December 31,
2021 2020
Research and development $ 657
45
Total $ 2,106 $ 139 As of
Income Taxes
We have accounted for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates applicable to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax
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assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance against deferred tax assets is recorded if, based upon the weight of all available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.
When uncertain tax positions exist, we recognize the tax benefit of tax positions to the extent that the benefit will more likely than not be realized. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position, as well as consideration of the available facts and circumstances. We recognize interest and penalties related to uncertain tax positions, if any exist, in income tax expense.
During the years ending
JOBS Act Accounting Election
We are an "emerging growth company" within the meaning of the JOBS Act. Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this extended transition period and, as a result, we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies that are not emerging growth companies.
Recent Accounting Pronouncements
See Note 3 to the consolidated financial statements for a discussion of recent accounting pronouncements.
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