$PRVB PRELIMINARY PROSPECTUS SUPPLEMENT
(To Prospectus dated August 8, 2019)
https://www.sec.gov/Archives/edgar/data/1695357/000149315220011294/form424b5.htm#sa_003
If you invest in our common stock in this offering, your ownership interest will be immediately diluted to the extent of the difference between the public offering price per share you pay in this offering and the as adjusted net tangible book value per share of our common stock immediately after giving effect to this offering.
Our net tangible book value equals our total tangible assets less our total liabilities. Net tangible book value per share is our net tangible book value divided by the number of shares of common stock outstanding as of March 31, 2020. Our historical net tangible book value as of March 31, 2020 was approximately $71.2 million, or approximately $1.49 per share of common stock.
After giving effect to the sale of 5,500,000 shares of common stock in this offering at the assumed public offering price of $15.58 per share, which was the last reported sale price of our common stock on the Nasdaq Global Select Market on June 15, 2020, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us, our as adjusted net book value as of March 31, 2020 would have been approximately $151.5 million, or approximately $2.85 per share. This represents an immediate increase in as adjusted net tangible book value of $1.36 per share to our existing stockholders, and an immediate dilution of $12.73 per share to new investors participating in this offering. The following table illustrates this dilution on a per share basis:
Assumed public offering price per share $15.58
Net tangible book value per share as of March 31, 2020 $1.49
Increase in net tangible book value per share as of March 31, 2020 attributable to this offering $1.36
As adjusted net tangible book value per share, after giving effect to this offering $2.85
Dilution per share to new investors participating in this offering $12.73
Each $1.00 increase (decrease) in the assumed public offering price of $15.58 per share, the last reported sales price of our common stock on the Nasdaq Global Select Market on June 15, 2020, would increase (decrease) our as adjusted net tangible book value per share after this offering by approximately $0.10, and the dilution per share to new investors purchasing shares in this offering by $0.90, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. We may also increase or decrease the number of shares to be issued in this offering. Each increase (decrease) of 1,000,000 shares offered by us would increase (decrease) our as adjusted net tangible book value per share by $0.22 and ($0.23), respectively, and the dilution per share to new investors purchasing shares in this offering by $0.22 and ($0.23), respectively, assuming that the assumed public offering price remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. The information discussed above is illustrative only and will be adjusted based on the actual public offering price and other terms of this offering as determined between us and the underwriters at pricing.
If the underwriters exercise their option to purchase 825,000 additional shares in full, our as adjusted net book value as of March 31, 2020 would increase to approximately $163.6 million, or approximately $3.03 per share, representing an immediate increase in as adjusted net tangible book value of $1.54 per share to our existing stockholders, and an immediate dilution of $12.55 per share to investors participating in this offering.
The above discussion and table are based on 47,712,636 shares of common stock outstanding on March 31, 2020 and excludes the following:
● 6,674,476 shares of our common stock issuable upon the exercise of outstanding stock options issued under our 2017 Equity Incentive Plan with a weighted average exercise price of $7.16 per share as at March 31, 2020;
● 3,102,154 additional shares of our common stock reserved for future issuance under our 2017 Equity Incentive Plan as at March 31, 2020;
● 2,124,568 shares of our common stock issuable upon the exercise of outstanding warrants with a weighted average exercise price of $4.35 per share as at March 31, 2020; and
● 725,495 shares of our common stock sold under our at-the-market program since March 31, 2020.
To the extent that options or warrants are exercised, new options are issued under our 2017 Equity Incentive Plan, or we issue additional shares of common stock in the future, there may be further dilution to investors participating in this offering. In addition, we may choose to raise additional capital because of market conditions or strategic considerations, even if we believe that we have sufficient funds for our current or future operating plans. If we raise additional capital through the sale of equity or convertible debt securities, the issuance of these securities could result in further dilution to our stockholders.