Eterna Therapeutics Inc
For the period ended Jun 30, 2024. Filed Aug 13, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 13, 2024
ERNA$1.88+2.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-14.
0001140361-24-026010
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-13.
0001493152-24-031639
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 78 previous paragraphs and 89 current paragraphs.
53 unchanged; 18 reworded; 15 added; 7 removed; 0 previous and 3 current paragraphs rearranged.
Tables are not compared: 5 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (15)
Current report
Sublessor Draw on Letter of Credit and Termination of Sublease
Current report
As previously reported, on May 3, 2024, we received a notice from the sublessor regarding past due rent of approximately $2.3 million that we did not pay for the months of February, March, April and May 2024. We also did not pay the rent for June, July or August 2024 and, as of August 1, 2024, we owed approximately $4.0 million in the aggregate in past due rent.
Current report
On August 5, 2024, the sublessor drew down on the letter of credit for the full $4.1 million to cover the approximately $4.0 million of past due rent payments, plus interest and penalties.
Current report
On August 9, 2024, we and the sublessor entered into a sublease termination agreement pursuant to which the parties agreed to terminate the sublease effective August 31, 2024. Pursuant to the sublease termination agreement, we agreed to surrender and vacate the premises, all of our right, title and interest in all furniture, fixtures and laboratory equipment at the premises will become the property of the sublessor, and both parties will be released of their obligations under the sublease. As a result of the sublease termination, we expect to save approximately $58.5 million in base rental payments plus parking, operating expenses, taxes and utilities that we would have paid over the remaining lease term.
Current report
We do not expect that the termination of the sublease will impact our current business needs.
Current report
Ex Parte Re-examination Certificates Received
Current report
As of November 16, 2022, three of our in-licensed patents were subject to re-examination by the United States Patent and Trademark Office (“USPTO”), under Re-examination Request Nos. US 90/019,127, US 90/019,128, and US 90/019,129. We have now received Ex Parte Reexamination Certificates for each of these requests, as of June 5, 2024, June 28, 2024, and June 21, 2024, respectively. In each case, the challenged patents survived this challenge to their validity. The challenged claims were minimally amended, and none were invalidated. The claims have now been twice examined by the USPTO and twice allowed.
Current report
Non-Compliance with Nasdaq’s Minimum Stockholders’ Equity Rule
Current report
As previously reported, on March 19, 2024, we received a notice from The Nasdaq Stock Market LLC stating that we are not in compliance with Nasdaq Listing Rule 5550(b)(1) (the “Minimum Stockholders’ Equity Rule”) because we reported stockholders’ equity of less than $2.5 million as of December 31, 2023. Our stockholders’ equity was $2.2 million as of December 31, 2023. The notice had no immediate effect on our Nasdaq listing. In May 2024, we submitted a plan to Nasdaq advising of actions we have taken or will take to regain compliance with the Minimum Stockholders’ Equity Rule. Nasdaq accepted our plan and granted us a 180-day extension, or through September 16, 2024, to regain compliance with the Minimum Stockholders’ Equity Rule. See the risk factor titled “Our failure to meet the continued listing requirements of Nasdaq could result in a delisting of our common stock,” in Item 1A. Risk Factors of Part II of this report.
Current report
Total research and development expenses decreased $0.7 million for the six months ended June 30, 2024 when compared to the six months ended June 30, 2023 primarily related to a decrease in expenses related to closing down the clinical trial from 2022 as well as a reduction in ongoing research expenses.
Current report
Acquisition of Exacis In-Process Research and Development
Current report
In April 2023, we acquired from Exacis Biotherapeutics Inc. (“Exacis”) substantially all of its intellectual property assets, including all of its right, title and interest in and to an exclusive license agreement by and between Exacis and Factor Limited (the “Purchased License”). The Purchased License was determined to be an in-process research and development (“IPR&D”) asset that has no alternative future use and no separate economic value from its original intended purpose, which is expensed in the period the cost is incurred. As a result, we expensed the fair value of the Purchased License of approximately $0.5 million during the three and six month ended June 30, 2023. For additional information, see Note 3 to the accompanying consolidated financial statements included in this report. There was no similar transaction during the three or six months ended June 30, 2024.
Current report
On the closing date of the acquisition of assets from Exacis in April 2023, we recognized a contingent consideration liability of $0.2 million for future payments that may be payable to Exacis, which was included as part of the $0.5 million fair value of the Purchased License asset and expensed as IPR&D for the three and six months ended June 30, 2023. This contingent consideration liability is remeasured at each period end, and any change in the fair value of the contingent liability is recognized in the statement of operations. As of June 30, 2023, we remeasured the contingent liability and recognized a credit of $0.1 million for both the three and six months ended June 30, 2023 due to the decrease in the fair value of the contingent consideration liability. As of June 30, 2024, we remeasured the contingent liability and recognized a credit of $0.1 million for both the three and six months ended June 30, 2024 due to the decrease in the fair value of the contingent consideration liability.
Current report
Other Expense, net
Current report
During the three and six months ended June 30, 2023, we recognized $0.3 million of other expense, all of which related to the value of the commitment shares issued to Lincoln Park Capital Fund, LLC (“Lincoln Park”) under a standby equity purchase agreement (“SEPA”) we entered into in April 2023 as well as other associated fees. We did not recognize any such expense during the three or six months ended June 30, 2024.
Removed paragraphs (7)
Previous report
Private Placement of Convertible Notes and Warrants
Previous report
On December 14, 2023, we entered into a purchase agreement with certain purchasers for the private placement of $9.2 million of convertible notes (the “December 2023 convertible notes” and together with the July 2023 convertible notes, the “convertible notes”) and warrants to purchase an aggregate of approximately 9.6 million shares of our common stock (the “December 2023 warrants” and together with the July 2023 warrants, the “note warrants”). There were two closings under this purchase agreement: on December 15, 2023, we received $7.8 million and issued $7.8 million in December 2023 convertible notes and December 2023 warrants to purchase approximately 8.1 million shares of our common stock, and on January 11, 2024, we received the remaining $1.4 million and issued an aggregate of $1.4 million in December 2023 convertible notes and December 2023 warrants to purchase approximately 1.5 million shares of our common stock. See Notes 4 and 12 to the accompanying condensed consolidated financial statements for additional information.
Previous report
Notice of Default under Sublease
Previous report
We have not paid our rent obligations under our Somerville, Massachusetts sublease for February, March, April or May 2024, and, as of the date of filing of this report, we owe approximately $2.3 million in past due rent. On May 3, 2024, we received a notice of default from the sublessor related to the foregoing and have had subsequent discussions with the Sublessor about remedying the event of default. See “Liquidity and Capital Resources—Material Cash Requirements—Somerville Sublease,” below.
Previous report
Somerville Sublease
Previous report
On May 3, 2024, we received a notice from the sublessor regarding past due rent payments of approximately $2.3 million, including our share of amounts related to property taxes and common area maintenance costs, that we have not paid for the months of February, March, April and May 2024. Failure to pay the past due rent payments in full, plus approximately $70,000 in late fees and interest, within five business days from the date of the notice constitutes an event of default under the sublease. We had discussions with the Sublessor subsequent to receiving notice about remedying the event of default, and as a result of those discussions, we did not pay any of the past due rent payments or any of the late fees or interest within such five business day period. We also have been in, and intend to continue, discussions with the sublessor to renegotiate the terms of the sublease, which may include, among other things, deferment of rent payments and/or a reduction of the lease term, square footage, and/or base rent.
Previous report
If an event of default exists under the sublease, beyond applicable notice and cure periods, the sublessor may draw down the letter of credit and use, apply or retain such portion of the proceeds from the letter of credit as may be necessary (i) for the payment of any rent or any other sum in default, (ii) for the payment of any other amount which the sublessor may, in accordance with the terms of the sublease, spend or become obligated to spend by reason of our default, or (iii) to compensate the sublessor, in accordance with the terms of the sublease, for any other loss or damage which the sublessor may suffer by reason of our default, including costs and reasonable attorneys’ fees incurred by the sublessor to recover possession of the premises following a default by us. As of the date of filing of this report, the sublessor has not drawn down on the letter of credit. The use or application of the proceeds from the letter of credit or any portion thereof does not prevent the sublessor from exercising any other right or remedy provided under the sublease or under law. If any portion of the letter of credit is so used or applied, we must, upon demand therefor, amend the letter of credit, provide an additional letter of credit or deposit cash with the sublessor, in each such case in an amount sufficient to restore the security deposit within 10 business days to the appropriate amount. See the risk factor titled, “Our monthly rent payment obligations under our sublease are significant and we currently owe approximately $2.3 million in past due rent. An event of default under our sublease could be an event of default under our outstanding convertible notes,” in Item 1A. Risk Factors of Part II of this report.
Reworded paragraphs (18)
Previous wording
You should read this discussion together with the unaudited interim condensed consolidated financial statements, related notes, and other financial information included elsewhere in this Quarterly Report on Form 10-Q together with our audited consolidated financial statements, related notes, and other information contained inour Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on March 14, 2023, as amended by the Form 10-K/A filed with the SEC on March 18, 2024 (as amended, the “2023 10-K”). The following discussion contains or is based on assumptions, estimates and other forward-looking statements that involve a number of risks and uncertainties, including those discussed under “Risk Factors,” in Part I, Item 1A of the 2023 10-K and as described from time to time in our other filings with the SEC. These risks could cause our actual results to differ materially from those anticipated in these forward-looking statements.
Current wording
You should read this discussion together with the unaudited interim condensed consolidated financial statements, related notes, and other financial information included elsewhere in this Quarterly Report on Form 10-Q together with our audited consolidated financial statements, related notes, and other information contained in**our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on March 14, 2023, as amended by the Form 10-K/A filed with the SEC on March 18, 2024 (as amended, the “2023 10-K”). The following discussion contains or is based on assumptions, estimates and other forward-looking statements that involve a number of risks and uncertainties, including those discussed under “Risk Factors,” in Part I, Item 1A of the 2023 10-K and as described from time to time in our other filings with the SEC. These risks could cause our actual results to differ materially from those anticipated in these forward-looking statements.
Previous wording
In October 2022, we entered into a sublease for approximately 45,500 square feet of office and laboratory space in Somerville, Massachusetts. The term of the sublease is approximately 10 years, and our base rent obligations over the term is estimated to be approximately $63.0 million, plus our share of the sublessor’s parking spaces and operating expenses. Our base rent obligations under the sublease during 2024 are expected to be $0.5 million per month. As part of the sublease, we delivered a security deposit in the form of a letter of credit in the amount of $4.1 million, which will be reduced on an incremental basis throughout the term of the sublease. The letter of credit was issued by our commercial bank, which required that we cash collateralize the letter of credit with $4.1 million of cash deposited in a restricted account maintained by such bank. The amount of required restricted cash collateral will decline in parallel with the reduction in the amount of the letter of credit over the term of the sublease.
Current wording
In October 2022, we entered into a sublease for office and laboratory space in Somerville, Massachusetts. See Note 8 to the accompanying condensed consolidated financial statements for additional information regarding the sublease.
Previous wording
Our near-term focus is on deploying our mRNA technology platform through strategic partnerships. We are not currently developing any product candidates. Our future revenue, if any, is primarily expected to come from out-licensing our mRNA technology platform and/or aspects thereof.
Current wording
Our near-term focus is on deploying our mRNA technology platform through strategic partnerships. We are not currently developing any product candidates. Our future revenue, if any, is primarily expected to come from out-licensingour mRNA technology platform and/or aspects thereof.
Previous wording
Comparison of the Three Months Ended March 31, 2024 and 2023
Current wording
Comparison of the Three and Six Months Ended June 30, 2024 and 2023
Previous wording
During the three March 31, 2024, we recognized revenue related to the cell line customization activities that we are performing for a third party. We did not perform any such activities, or otherwise recognize any revenue, during the three months ended March 31, 2023.
Current wording
During the three and six months ended June 30, 2024, we recognized revenue related to the cell line customization activities that we are performing for a third party. We did not perform any such activities, or otherwise recognize any revenue, during the three or six months ended June 30, 2023.
Previous wording
During the three months ended March 31, 2024, our cost of revenues included direct labor and materials to perform the customization cell line activities for a third party. During the three months ended March 31 2023, we received a $0.3 upfront payment pursuant to a customer contract with this third party. Although the $0.3 million was recorded as deferred revenue as of March 31, 2023, the obligation to pay Factor Limited the 20% license fee was incurred upon receipt of the payment from the third party, and was therefore recognized as a cost of revenue during the three months ended March 31, 2023. As of March 31, 2024, the $0.3 upfront payment continues to be recognized in long-term deferred revenue in the accompanying condensed consolidated balance sheet.
Current wording
During the three and six months ended June 30, 2024, our cost of revenues included direct labor and materials to perform the customization cell line activities for a third party. During the six months ended June 30, 2023, we received a $0.3 upfront payment pursuant to a customer contract with this third party. Although the $0.3 million was recorded as deferred revenue as of June 30, 2023, the obligation to pay Factor Limited the 20% license fee was incurred upon receipt of the payment from the third party, and was therefore recognized as a cost of revenue during the six months ended June 30, 2023. There were no such costs recognized during the three months ended June 30, 2023. As of June 30, 2024, the $0.3 upfront payment continues to be recognized in long-term deferred revenue in the accompanying condensed consolidated balance sheet.
Previous wording
Total research and development expenses decreased by approximately $0.2 million for the three months ended March 31, 2024 when compared to the three months ended March 31, 2023 primarily due to a decrease in professional fees related to closing down a clinical trial we ended in 2022 and other miscellaneous expenses, partially offset by increased payroll expense due to severance recognized during the three months ended March 31, 2024.
Current wording
Total research and development expenses decreased by approximately $0.5 million for the three months ended June 30, 2024 when compared to the three months ended June 30, 2023 primarily due to a decrease in payroll-related expenses from a reduction in headcount as well as a reduction in other expenses related to closing down a clinical trial we ended in 2022.
Previous wording
Our general and administrative expenses increased by approximately $0.7 million for the three months ended March 31, 2024 when compared to the three months ended March 31, 2023 primarily due to increased occupancy expense related to the Somerville sublease that we began to incur in July 2023, as well as increased payroll related to increased general and administrative headcount. These increases were partially offset by decreases in professional fees related to legal services, insurance expense due to lower premiums and stock-based compensation expense resulting from a decrease in the fair value of stock options expensed during the three months ended March 31, 2024 compared to the fair value of the stock options expensed during the three months ended March 31, 2023.
Current wording
Our general and administrative expenses increased by approximately $1.3 and $2.0 million for the three and six months ended June 30, 2024, respectively, when compared to the three and six months ended June 30, 2023 primarily due to increased occupancy expense related to the Somerville sublease that we began to incur in July 2023. The increase in occupancy expense was partially offset by decreases in professional fees related to legal services and consultants, insurance expense due to lower premiums and payroll-related expenses resulting from a decrease severance expense during the three and six months ended June 20, 2024 compared to the three and six months ended June 30, 2023.
Previous wording
For the three months ended March 31, 2024 and 2023, we recognized expense related to the change in the fair value of warrant liabilities due to an increase in the market price of our common stock.
Current wording
We recognized credits of approximately $0.1 million in each of the three and six months ended June 30, 2024 for the change in the fair value of warrant liabilities due to a decrease in the market price of our common stock as of June 30, 2024. For the three and six months ended June 30, 2023, we recognized credits of $0.2 million and $0.1 million, respectively, for the change in the fair value of warrant liabilities due to a decrease in the market price of our common stock as of June 30, 2023.
Previous wording
We account for our 25% non-controlling investment in NoveCite, Inc. (“NoveCite”) under the equity method. We have not guaranteed any obligations of NoveCite, nor are we otherwise committed to providing further financial support for NoveCite. Therefore, we only record 25% of NoveCite’s losses up to our investment carrying amount.. As a result, we did not recognize additional losses related to NoveCite for the three months ended March 31, 2024. For the three months ended March 31, 2023, we recognized approximately $0.1 million of loss.
Current wording
We account for our 25% non-controlling investment in NoveCite, Inc. (“NoveCite”) under the equity method. We have not guaranteed any obligations of NoveCite, nor are we otherwise committed to providing further financial support for NoveCite. Therefore, we only record 25% of NoveCite’s losses up to our investment carrying amount.. As a result, we did not recognize additional losses related to NoveCite for the three or six months ended June 30, 2024. We recognized a de minimus loss related to NoveCite for the three months ended June 30, 2023 and a loss of approximately $0.1 million for the six months ended June 30, 2023.
Previous wording
We recognized an increase in interest expense for the three months ended March 31, 2024 of approximately $0.8 million primarily due to approximately $0.4 million of interest related to the convertible notes as well as the amortization of the debt discount and debt issuance costs associated with the convertible note financings of approximately $0.4 million. There were no convertible notes (or similar debt instruments) outstanding during the three months ended March 31, 2023. This increase in expense was partially offset by an increase in interest income from our cash that was deposited into interest-bearing accounts.
Current wording
We recognized an increase in interest expense for the three and six months ended June 30, 2024 of approximately $0.8 million and $1.6 million, respectively, primarily due to approximately $0.4 million and $0.8 million of interest for the three and six months ended June 30, 2024, respectively, related to the convertible notes as well as the amortization of the debt discount and debt issuance costs associated with the convertible note financings of approximately $0.5 million and $0.9 million for the three and six months ended June 30, 2024, respectively. This increase in interest expense was partially offset by an increase in interest income of $0.1 million in each of the three and six months ended June 30, 2024 from our cash deposited into interest-bearing accounts. There were no convertible notes (or similar debt instruments) outstanding during the three or six months ended June 30, 2023.
Previous wording
At March 31, 2024, we had cash and cash equivalents of approximately $9.2 million, of which approximately $4.1 million was restricted cash (see—Material Cash Requirements—Somerville Sublease, below) and an accumulated deficit of approximately $193.6 million. We have to date incurred operating losses, and we expect these losses to continue in the future. For the three months ended March 31, 2024, we incurred a net loss of $6.6 million, and we used $3.7 million in operating activities.
Current wording
At June 30, 2024, we had cash and cash equivalents of approximately $6.7 million, of which approximately $4.1 million was restricted cash and an accumulated deficit of approximately $199.2 million. We have to date incurred operating losses, and we expect these losses to continue in the future. For the three and six months ended June 30, 2024, we incurred a net loss of $5.5 million and $12.2 million, respectively. For the six months ended June 30, 2024, we used $6.0 million in operating activities.
Previous wording
Currently, our sole source of liquidity is through sales of our common stock under the standby equity purchase agreement (the “SEPA”) we entered into with Lincoln Park Capital Fund, LLC (“Lincoln Park”) in April 2023, pursuant to which Lincoln Park committed to purchase up to $10.0 million of our common stock. Such sales of common stock by us, if any, are subject to certain conditions and limitations set forth in the SEPA, including a condition that we may not direct Lincoln Park to purchase any shares of common stock under the SEPA if such purchase would result in Lincoln Park beneficially owning more than 4.99% of our issued and outstanding shares of common stock. Sales under the SEPA may occur from time to time, at our sole discretion, through April 2025. To date, we have issued and sold approximately 214,000 shares of our common stock to Lincoln Park, including the 74,000 commitment shares, and have received approximately $0.3 million in gross proceeds from such sales. We sold no shares under the SEPA during the three months ended March 31, 2024.
Current wording
Currently, our sole source of liquidity is through sales of our common stock under the SEPA, pursuant to which Lincoln Park committed to purchase up to $10.0 million of our common stock. Such sales of common stock by us, if any, are subject to certain conditions and limitations set forth in the SEPA, including a condition that we may not direct Lincoln Park to purchase any shares of common stock under the SEPA if such purchase would result in Lincoln Park beneficially owning more than 4.99% of our issued and outstanding shares of common stock. Sales under the SEPA may occur from time to time, at our sole discretion, through April 2025. To date, we have issued and sold approximately 214,000 shares of our common stock to Lincoln Park, including the approximately 74,000 commitment shares, and have received approximately $0.3 million in gross proceeds from such sales. We sold no shares under the SEPA during the six months ended June 30, 2024.
Previous wording
There was a decrease of approximately $2.3 million in cash used in operating activities for the three months ended March 31, 2024 compared to the same period in 2023. This change was due to a decrease in cash used in operating assets and liabilities of $2.5 million, primarily related to accounts payable and accrued expenses, partially offset by a $0.2 million increase in net loss, after giving effect to adjustments made for non-cash transactions, for the three months ended March 31, 2024 compared to the same period in 2023.
Current wording
There was a decrease of approximately $3.9 million in cash used in operating activities for the six months ended June 30, 2024 compared to the same period in 2023. This change was due to a decrease in cash used in operating assets and liabilities of $4.2 million, primarily related to increased accounts payable, accrued expenses and operating lease liabilities, partially offset by a $0.3 million increase in net loss, after giving effect to adjustments made for non-cash transactions, for the six months ended June 30, 2024 compared to the same period in 2023.
Previous wording
We used approximately $0.1 million to pay for the purchases of property and equipment during the three months ended March 31, 2024. There were no investing activities during the three months ended March 31, 2023.
Current wording
We used approximately $0.3 million to pay for the purchases of property and equipment during the six months ended June 30, 2024. There were no investing activities during the six months ended June 30, 2023.
Previous wording
Net cash provided by financing activities for the three months ended March 31, 2024 includes approximately $1.4 million of proceeds received from the second closing of the December 2023 convertible notes financing that occurred in January 2024. There were no financing activities during the three months ended March 31, 2023.
Current wording
Net cash provided by financing activities for the six months ended June 30, 2024 includes approximately $1.4 million of proceeds received from the second closing of the December 2023 convertible notes financing that occurred in January 2024 . Net cash provided by financing activities for the six months ended June 30, 2023 includes approximately $0.3 million of proceeds received from selling approximately 214,000 shares to Lincoln Park under the SEPA. The Company did not sell any shares under the SEPA during the six months ended June 30, 2024.
Previous wording
As of the date of this report, the aggregate amount outstanding under our convertible notes, including accrued interest that has been paid in-kind, is $18.5 million, of which $9.0 million and $9.5 million relates to the July 2023 convertible notes and the December 2023 convertible notes, respectively. Unless earlier called for redemption by the holders thereof, the convertible notes mature on the five-year anniversary of their date of issuance. We may not redeem any of the convertible notes prior to maturity. See Note 4 to the accompanying condensed consolidated financial statements for additional information. See also the risk factor titled, “Our monthly rent payment obligations under our sublease are significant and we currently owe approximately $2.3 million in past due rent. An event of default under our sublease could be an event of default under our outstanding convertible notes,” in Item 1A. Risk Factors of Part II of this report.
Current wording
As of the filing date of this report, the aggregate amount outstanding under our convertible notes, including accrued interest that has been paid in-kind, is $19.0 million, of which $9.2 million and $9.8 million relates to the July 2023 convertible notes and the December 2023 convertible notes, respectively. Unless earlier called for redemption by the holders thereof, the convertible notes mature on the five-year anniversary of their date of issuance. We may not redeem any of the convertible notes prior to maturity. See Note 4 to the accompanying condensed consolidated financial statements for additional information.
Previous wording
There were no significant changes in our critical accounting estimates during the three months ended March 31, 2024 from those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of the 2023 10-K.
Current wording
There were no significant changes in our critical accounting estimates during the three months ended June 33, 2024 from those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of the 2023 10-K.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Current report — wording carried from elsewhere
In connection with entering into the sublease, we delivered a security deposit in the form of a letter of credit in the amount of $4.1 million. The letter of credit was collateralized with $4.1 million of cash deposited in a restricted account.
Current report — wording carried from elsewhere
Change in Fair Value of Contingent Consideration