Skye Bioscience, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Warrants and Derivative Liabilities (Tables)

Warrants and Derivative Liabilities (Tables)

3 Months Ended

Mar. 31, 2020

Derivative Liabilities Line Items

Schedule of warrants vested and outstanding

										Number of Warrants
		Exercise				Term				Vested and
Source		Price				(Years)				Outstanding
Pre 2015 Common Stock Warrants		$	1.00			6—10					4,000,000
2015 Common Stock Warrants		$	1.15-$5.00			5—10					442,000
Common Stock Warrants to Series B Stockholders		$	0.00				5				718,750
2016 Common Stock Warrants to Service Providers		$	1.15				10				40,000
2016 Series C Common Stock Warrants to Placement Agent		$	0.40				5				125,000
2017 Series D Common Stock Warrants to Placement Agent		$	0.25				5				480,000
2017 Common Stock Warrants to Service Provider		$	0.41				5				125,000
2018 Emerald Financing Warrants		$	0.10				5				3,400,000
Emerald Multi Draw Credit Agreement Warrants		$	0.50				5				7,500,000
2019 Common Stock Warrants		$	0.35				5				8,000,000
Total warrants vested and outstanding as of March 31, 2020											24,830,750

Schedule of the activity of derivative liabilities

		Three Months Ended March 31, 2020
		December 31, 2019, Fair Value of Derivative Liabilities				Fair Value of Derivative Liabilities Issued				Change in Fair value of Liabilities				Reclassification of Derivatives to Equity				March 31, 2020, Fair Value of Derivative Liabilities
Emerald Multi-Draw Credit Agreement - compound derivative liability ⁽¹⁾		$	90,797			$	—			$	100,085			$	—			$	190,882
Emerald Financing - warrant liability ⁽²⁾			276,024				—				(81,879	)			—				194,145
Series B - warrant liability ⁽³⁾			134,579				—				(54,109	)			(26,563	)			53,907
Total derivative liabilities		$	501,400			$	—			$	(35,903	)		$	(26,563	)		$	438,934
Less, noncurrent portion of derivative liabilities			(90,797	)															(190,882	)
Current balance of derivative liabilities		$	410,603															$	248,052

		Three Months Ended March 31, 2019
		December 31, 2018, Fair Value of Derivative Liabilities				Fair Value of Derivative Liabilities Issued				Change in Fair value of Derivative Liabilities				Reclassification of Derivatives to Equity				March 31, 2019, Fair Value of Derivative Liabilities
Emerald Multi-Draw Credit Agreement - compound derivative liability ⁽¹⁾		$	219,453			$	516,058			$	227,858			$	—			$	963,369
Emerald Financing - warrant liability ⁽²⁾			15,251,413				—				12,239,322				—				27,490,735
Series B - warrant liability ⁽³⁾			487,500				—				353,438				—				840,938
Total derivative liabilities		$	15,958,366			$	516,058			$	12,820,618			$	—			$	29,295,042
Less, noncurrent portion of derivative liabilities			(219,453	)															(963,369	)
Current balance of derivative liabilities		$	15,738,913															$	28,331,673

Emerald Multi-Draw Credit Agreement Warrants

Derivative Liabilities Line Items

Schedule of input and valuation technique used to value derivative liabilities

		At Issuance
Dividend yield			0.00	%
Volatility factor		91.6-92.1		%
Risk-free interest rate		2.23-2.51		%
Expected term (years)			5.0
Underlying common stock price		$	0.33—0.69

Emerald Multi-Draw Credit Agreement Compound Derivative Liability

Derivative Liabilities Line Items

Schedule of input and valuation technique used to value derivative liabilities

		March 31, 2020
Volatility factor			79.8	%
Benchmarked yield			18.46	%
Remaining term (years)			2.55
Underlying common stock price		$	0.08

Emerald Financing Warrant Liability

Derivative Liabilities Line Items

Schedule of input and valuation technique used to value warrant liabilities

		March 31, 2020				December 31, 2019
Dividend yield			0.00	%			0.00	%
Volatility factor			81.4	%			79.5	%
Risk-free interest rate			0.28	%			1.62	%
Expected term (years)			2.88				3.13
Underlying common stock price		$	0.08			$	0.13

Series B Warrant Liability

Derivative Liabilities Line Items

Schedule of input and valuation technique used to value warrant liabilities

		As of March 31, 2020				As of December 31, 2019
Dividend yield			0.00	%			0.00	%
Volatility factor			79.8	%			79.2	%
Risk-free interest rate			0.13	%			1.60	%
Expected term (years)			0.39				0.64
Underlying common stock price		$	0.08			$	0.13