Company: ZVRA
Filing Date: 2025-05-13
Form Type: 10-Q
Source: 0001437749-25-016523
Chunk: 21

Company: ZEVRA THERAPEUTICS, INC.
Filing Date: 2025-05-13
Form: 10-Q
Item: Part I, Item 8
Chunk 21
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 its common stock (the “2023 Warrants”) at a combined offering price of $4.34 per share of common stock and the 2023 Warrants and an aggregate of 917,934 shares of its common stock in exchange for the cancellation of a warrant to purchase 2,920,306 shares of common stock of Acer. The 2023 Warrants are immediately exercisable and expire on  November 22, 2028. The Company used the net proceeds of approximately $6.0 million from the offering for general corporate purposes. These warrants are separately exercisable by the warrant holders. While the warrants are outstanding (but unexercised), the warrant holders will participate in any dividend or other distribution of the Company’s assets to its common stockholders by way of return of capital or otherwise. As of  March 31, 2025, and  December 31, 2024, none of the warrants have been exercised. The warrants have been evaluated to determine the appropriate accounting and classification pursuant to ASC 480 and ASC 815. Generally, freestanding warrants should be classified as (i) liabilities if the warrant terms allow settlement of the warrant exercise in cash and (ii) equity if the warrant terms only allow settlement in shares of common stock.
    
   The Company determined that its outstanding warrants and the Put Option should be recorded as a liability and stated at fair value at each reporting period. Changes to the fair value of the warrant liability are recorded through the unaudited condensed consolidated statements of operations as a fair value adjustment related to warrant and CVR liability. As of  March 31, 2025, and  December 31, 2024, the fair value of the liability associated with these warrants and the Put Option was approximately $13.0 million and $17.8 million, respectively. The fair value adjustment related to these warrants and the Put Option was approximately $4.8 million and $4.6 million of income for the three months ended  March 31, 2025, and 2024, respectively. 

   H.Stock-Based Compensation

   In  November 2014, the Board of Directors of the Company (“the Board”), and in  April 2015, the Company’s stockholders, approved the Company’s 2014 Equity Incentive Plan (the “2014 Plan”), which became effective