12. Subsequent events

As previously disclosed, on March 15, 2016, The NASDAQ Stock Market LLC (“NASDAQ”) notified XOMA that the Company was out of compliance with NASDAQ Listing Rule 5450(a)(1), requiring maintenance of a minimum bid price of $1.00 per share (“Minimum Bid Price Requirement”). The Company did not achieve compliance with the Minimum Bid Price Requirement by September 12, 2016 and NASDAQ notified the Company that its securities were subject to delisting (“Delisting Notice”). The Company exercised its right to appeal the Delisting Notice, which suspended the delisting pending a final decision on the appeal. Prior to a hearing on the appeal, the Company presented a plan to effect a reverse stock split of its issued and outstanding shares of common stock as a means to regain compliance with the Minimum Bid Price Requirement, and continue the listing of the Company’s common stock on the NASDAQ Global Market. At a special meeting held on October 14, 2016, XOMA’s stockholders approved the reverse stock split and gave XOMA’s Board of Directors’ discretion to effect the reverse split within a range of ratios. The Board subsequently decided to effect a reverse stock split in a ratio of 1-for-20, effective after market close on October 17, 2016. Upon the effectiveness of the reverse stock split, (i) every 20 shares of the Company’s outstanding common stock was combined into 1 share of common stock, (ii) the number of shares of common stock available for issuance under the 2010 Plan and ESPP was proportionally decreased, (iii) the number of shares of common stock issuable upon the exercise of the outstanding stock options and warrants was proportionally decreased, (iv) the exercise price of the outstanding stock options and warrants was proportionally increased, and (v) the number of shares of common stock issuable upon the vesting of the outstanding restricted stock units was proportionally decreased. The par value per share and the authorized number of shares of common stock and preferred stock were not adjusted as a result of the reverse stock split. From October 18, 2016 through October 31, 2016, the closing bid price of XOMA’s common stock exceeded $1.00 per share. As a result, the Company regained compliance with the Minimum Bid Price Requirement, upon which NASDAQ canceled the appeal hearing and withdrew the Delisting Notice.

In connection with the reverse stock split, all issued and outstanding common stock, stock awards and per share amounts contained in the financial statements have been retroactively adjusted to reflect the reverse stock split for all periods presented.