What changed in this filing

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Item 1. Financial Statements

2022-11-10 compared with 2022-08-11 · 119 added, 82 removed, 348 unchanged (37% of the section changed)

3 unchanged sentences

(In $000s, except share, per share, and liquidation preference amounts)

September 30,

Current assets:

12 unchanged sentences

Total liabilities

Redeemable common stock, $ 0.001 par value;

0 and 3,117,100 shares issued and outstanding at December 31, 2021 and September 30, 2022 (Note 10)

Stockholders’ equity:

Preferred stock, $ 0.001 par value;

5,000,000 shares authorized at December 31, 2021 and June 30, 2022;

5,000,000 shares authorized at December 31, 2021 and September 30, 2022;

6 % Convertible Exchangeable preferred stock;

335,273 shares issued and outstanding at December 31, 2021 and June 30, 2022.

Aggregate preference in liquidation of $ 4,006,512 as of December 31, 2021 and June 30, 2022.

335,273 shares issued and outstanding at December 31, 2021 and September 30, 2022.

Aggregate preference in liquidation of $ 4,006,512 as of December 31, 2021 and September 30, 2022.

Series A convertible preferred stock, $ 0.001 par value;

264 shares issued and outstanding at December 31, 2021 and June 30, 2022.

264 shares issued and outstanding at December 31, 2021 and September 30, 2022.

Series B convertible preferred stock, $ 0.001 par value;

237,745 shares issued and outstanding at December 31, 2021 and June 30, 2022.

237,745 shares issued and outstanding at December 31, 2021 and September 30, 2022.

Common stock, $ 0.001 par value;

100,000,000 shares authorized at December 31, 2021 and June 30, 2022;

11,350,289 and 9,993,135 shares issued and outstanding at June 30, 2022 and December 31, 2021 respectively.

100,000,000 shares authorized at December 31, 2021 and September 30, 2022;

9,993,135 and 12,539,189 shares issued and outstanding at December 31, 2021 and September 30, 2022 respectively.

Additional paid-in capital

8 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Operating expenses:

19 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Translation adjustment

23 unchanged sentences

Balances at June 30, 2021

Issue of common stock on At Market Issuance sales agreement, net of expenses

Stock-based compensation

Preferred stock dividends

Unrealized foreign exchange on intercompany loans

Translation adjustment

Loss for the period

Balances at September 30, 2021

Balances at December 31, 2021

13 unchanged sentences

Balances at June 30, 2022

Issue of common stock on At Market issuance sales agreement, net of expenses

Reclassification of redeemable common stock

( 3,117,100 )

Stock-based compensation

Preferred stock dividends

Unrealized foreign exchange on intercompany loans

Translation adjustment

Loss for the period

Balances at September 30, 2022

The accompanying notes are an integral part of these consolidated financial statements.

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months Ended

Nine Months Ended

September 30,

Operating activities:

29 unchanged sentences

(“Cyclacel” or the “Company”) is a clinical-stage biopharmaceutical company developing innovative cancer medicines based on cell cycle, transcriptional regulation and mitosis control biology.

Cyclacel is a pioneer company in the field of cancer cell cycle biology with a vision to improve patient healthcare by translating insights in cancer biology into medicines that can overcome resistance and ultimately increase a patient’s overall survival.

Through June 30, 2022, substantially all efforts of the Company to date have been devoted to performing research and development, conducting clinical trials, developing and acquiring intellectual property, raising capital and recruiting and training personnel.

Cyclacel is a pioneer in the field of cancer cell cycle biology with a vision to improve patient healthcare by translating insights in cancer biology into medicines that can overcome resistance and ultimately increase a patient’s overall survival rate.

Through September 30, 2022, substantially all efforts of the Company to date have been devoted to performing research and development, conducting clinical trials, developing and acquiring intellectual property, raising capital and recruiting and training personnel.

Summary of Significant Accounting Policies

Basis of Presentation

The consolidated balance sheet as of June 30, 2022, the consolidated statements of operations, comprehensive loss, and stockholders’ equity for the three and six months ended June 30, 2022 and 2021 and the consolidated statements of cash flows for the six months ended June 30, 2022 and 2021, and all related disclosures contained in the accompanying notes, are unaudited.

The consolidated balance sheet as of September 30, 2022, the consolidated statements of operations, comprehensive loss, and stockholders’ equity for the three and nine months ended September 30, 2022 and 2021 and the consolidated statements of cash flows for the nine months ended September 30, 2022 and 2021, and all related disclosures contained in the accompanying notes, are unaudited.

The consolidated balance sheet as of December 31, 2021 is derived from the audited consolidated financial statements included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed with the Securities and Exchange Commission (the “SEC”) on March 30, 2022.

The consolidated financial statements are presented on the basis of accounting principles that are generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the rules and regulations of the SEC.

Accordingly, they do not include all the information and footnotes required by accounting principles generally accepted in the United States for a complete set of financial statements.

In the opinion of management, all adjustments, which include only normal recurring adjustments necessary to present fairly the consolidated balance sheet as of June 30, 2022, and the results of operations and, comprehensive loss for the three and six months ended June 30, 2022, and cash flows for the six months ended June 30, 2022, have been made.

The interim results for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any other reporting period.

Accordingly, they do not include all the information and footnotes required by GAAP for a complete set of financial statements.

In the opinion of management, all adjustments, which include only normal recurring adjustments necessary to present fairly the consolidated balance sheet as of September 30, 2022, and the results of operations and, comprehensive loss for the three and nine months ended September 30, 2022, and cash flows for the nine months ended September 30, 2022, have been made.

The interim results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any other reporting period.

The consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the accompanying notes for the year ended December 31, 2021 that are included in the Company’s Annual Report on Form 10-K filed with the SEC on March 30, 2022.

1 unchanged sentence

Management considers that there are no conditions or events, in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern for a period of at least one year from the date the financial statements are issued.

The Company expects that its cash of approximately $ 29.1 million as of June 30, 2022 will be sufficient to fund its operating expenses and capital expenditure requirements into the second half of 2023.

The Company expects that its cash of approximately $ 23.7 million as of September 30, 2022 will be sufficient to fund its operating expenses and capital expenditure requirements to the end of 2023.

This evaluation is based on relevant conditions and events that are known and reasonably knowable at the date that the financial statements are issued, including:

3 unchanged sentences

Other conditions and events, when considered in conjunction with the above, that may adversely affect the Company’s ability to meet its obligations.

The future viability of the Company beyond the second half of 2023 is dependent on its ability to raise additional capital to finance its operations.

The future viability of the Company beyond 2023 is dependent on its ability to raise additional capital to finance its operations.

The Company does not currently have sufficient funds to complete development and commercialization of any of its drug candidates.

4 unchanged sentences

Accounting Standards Adopted in the Period

In November 2021 , the FASB issued ASU No.

In November 2021 , the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2021-10, Government Assistance (Topic 832):

1 unchanged sentence

This ASU requires business entities to make annual disclosures about transactions with a government they account for by analogizing to a grant or contribution accounting model under ASC 958-605 or based on International Accounting Standard No.

ASU 2021-10 became effective for us on January 1, 2022.

The Company has evaluated the effect that this guidance has on its Consolidated Financial Statements and determined it does not have a material impact.

ASU 2021-10 which became effective for us on January 1, 2022.

The Company has evaluated the effect that this guidance has on its Consolidated Financial Statements and has determined it does not have a material impact.

In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) .

3 unchanged sentences

Recently Issued Accounting Pronouncements

The Financial Accounting Standards Board (“FASB”) has issued ASU 2020-04, “Reference Rate Reform (Topic 848)”.

This standard provides optional expedients and exceptions for applying generally accepted accounting principles (GAAP) to contracts, hedging relationships, and other transactions affected by reference rate reform initiatives that would replace interbank offered rates, including the London Interbank Offered Rate (LIBOR).

The FASB has issued ASU 2020-04, “Reference Rate Reform (Topic 848)”.

This standard provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform initiatives that would replace interbank offered rates, including the London Interbank Offered Rate (“LIBOR”).

For example, modifications of lease contracts within the scope of ASC 842 solely for changes in reference rates would be accounted for as a continuation of the existing contracts with no reassessments of the lease classification and the discount rate.

9 unchanged sentences

No taxes were recorded on items of other comprehensive income

There were no reclassifications out of other comprehensive income (loss) during the six months ended June 30, 2021 and 2022.

There were no reclassifications out of other comprehensive income (loss) during the nine months ended September 30, 2021 and 2022.

Revenue Recognition

18 unchanged sentences

Grant revenue received from organizations that are not the Company’s customers, such as charitable foundations or government agencies, is presented as a reduction against the related research and development expenses.

Moreover, other inflows that are not a result of the Company’s ongoing and central operations are presented as other income, net.

The Company accounts for lease contracts in accordance with ASC 842.

As of June 30, 2022, the Company’s only outstanding facilities lease is classified as an operating lease.

As of September 30, 2022, the Company’s only outstanding facilities lease is classified as an operating lease.

The Company recognizes an asset for the right to use an underlying leased asset for the lease term and records lease liabilities based on the present value of the Company’s obligation to make lease payments under the lease.

As the Company’s lease does not specify an implicit rate, the Company uses a best estimate of its incremental borrowing rate to discount the future lease payments.

The Company estimates its incremental borrowing rate based on observable

information about risk-free interest rates that are the same tenure as the lease term, adjusted for various factors, including the effects of assumed collateral, the nature of how the loan is repaid (e.g., amortizing versus bullet), and the Company’s credit risk.

Company’s lease does not specify an implicit rate, the Company uses a best estimate of its incremental borrowing rate to discount the future lease payments.

The Company estimates its incremental borrowing rate based on observable information about risk-free interest rates that are the same tenure as the lease term, adjusted for various factors, including the effects of assumed collateral, the nature of how the loan is repaid (e.g., amortizing versus bullet), and the Company’s credit risk.

The Company evaluates options included in its lease agreement to extend or terminate the lease.

11 unchanged sentences

The Company has elected an accounting policy to account for the lease and non-lease components as a single lease component.

Revenue recognized in the three and six months ended June 30, 2021 and 2022 was $ 0 .

Revenue recognized in the three and nine months ended September 30, 2021 and 2022 was $ 0 .

Net Loss per Common Share

1 unchanged sentence

Basic and diluted net loss per common share was determined by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period.

The following potentially dilutive securities have not been included in the computation of diluted net loss per share for the three months ended June 30, 2021 and 2022, as the result would be anti-dilutive:

The following potentially dilutive securities have not been included in the computation of diluted net loss per share for the three months ended September 30, 2021 and 2022, as the result would be anti-dilutive:

September 30,

Stock options

7 unchanged sentences

Prepaid expenses and other current assets consisted of the following (in $000s):

September 30,

Research and development tax credit receivable

2 unchanged sentences

Non-Current Assets

As of June 30, 2022, the Company had non-current assets of $ 3.1 million, which is mostly comprised of clinical trial deposits held by a contract research organization in relation to the Company’s Phase 1/2 clinical trials.

As of September 30, 2022, the Company had non-current assets of $ 2.9 million, which is comprised of clinical trial deposits held by a contract research organization in relation to the Company’s Phase 1/2 clinical trials.

Accrued and Other Liabilities

Accrued and other current liabilities consisted of the following (in $000s):

September 30,

Accrued research and development

1 unchanged sentence

Other current liabilities

Other current liabilities for the year ended December 31, 2021 was largely attributed to accrued payroll costs.

Other current liabilities for the year ended December 31, 2021 were largely attributed to accrued payroll costs.

The Company currently has one lease, relating to its facility in Berkeley Heights, New Jersey.

On April 4, 2022 the Company extended this lease by three years , expiring July 31, 2025.

On May 4, 2021, the Company assigned an operating lease relating to its facility in Dundee, Scotland to the University of Dundee, Scotland, incurring lease assignment costs of approximately $ 400,000 , of which 50 % was paid on assignment and the remaining 50 % was paid on May 4, 2022.

On May 4, 2021, the Company assigned an operating lease relating to its U.K.

facility to the University of Dundee, Scotland, incurring lease assignment costs of approximately $ 400,000 , of which 50 % was paid on assignment and the remaining 50 % was paid on May 4, 2022.

The Company has no further obligations, liabilities or commitments in relation to this facility.

As of and for the six months ended June 30, 2022 and 2021:

The Company recognized operating lease expenses of $ 30,470 and $ 144,463 in the six month periods ending June 30, 2022 and 2021 respectively.

Cash payments made during the six months ended June 30, 2022 and 2021 totaled $ 30,870 and $ 150,941 respectively and were presented within cash outflows from operating activities.

The remaining lease term as of June 30, 2022 is approximately 3.1 years for the Berkeley Heights facility.

As of and for the nine months ended September 30, 2022 and 2021:

The Company recognized operating lease expenses of $ 46,699 and $ 159,898 in the nine month periods ending September 30, 2022 and 2021 respectively.

Cash payments made during the nine months ended September 30, 2022 and 2021 totaled $ 46,489 and $ 166,376 respectively and were presented within cash outflows from operating activities.

The remaining lease term as of September 30, 2022 is approximately 2.8 years for the Berkeley Heights facility.

The discount rate used by the Company in determining the lease liability was 12 %.

5 unchanged sentences

Forfeitures are recognized in the periods when they occur.

Stock based compensation has been reported within expense line items on the consolidated statement of operations for the three and six months ended June 30, 2021 and 2022 as shown in the following table (in $000s):

Stock based compensation has been reported within expense line items on the consolidated statement of operations for the three and nine months ended September 30, 2021 and 2022 as shown in the following table (in $000s):

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

General and administrative

4 unchanged sentences

The 2018 Plan allows for various types of award grants, including stock options and restricted stock units.

On June 14, 2022, the Company’s stockholders approved an amendment of the 2018 Plan to increase the number of shares of Common Stock available for grant under the Plan by adding an additional 500,000 shares.

As of June 30, 2022, the Company has reserved 389,896 shares of the Company’s common stock under the 2018 Plan for future issuances, including shares that were available under the 2015 Plan and carried forward to the 2018 Plan.

On June 14, 2022, the Company’s stockholders approved an amendment to the 2018 Plan to increase the number of shares of common stock available for grant under the 2018 Plan by 500,000 shares.

As of September 30, 2022, the Company has reserved 384,896 shares of the Company’s common stock under the 2018 Plan for future issuances, including shares that were available under the 2015 Plan and carried forward to the 2018 Plan.

Stock option awards granted under the Company’s equity incentive plans have a maximum life of 10 years and generally vest over a one to four-year period from the date of grant.

3 unchanged sentences

The Inducement Plan allows for the issuance of up to 200,000 shares of the Company’s common stock (or the equivalent of such number).

As of June 30, 2022, 120,000 shares under the Inducement Plan have been issued, leaving a remaining reserve of 80,000 shares.

As of September 30, 2022, 120,000 shares under the Inducement Plan have been issued, leaving a remaining reserve of 80,000 shares.

Option Grants and Exercises

There were 517,337 options granted during the six months ended June 30, 2022.

There were 522,337 options granted during the nine months ended September 30, 2022.

These options had a grant date fair value ranging between $ 0.83 -$ 2.90 per option.

There were 129,153 options granted during the six months ended June 30, 2021.

There were 154,653 options granted during the nine months ended September 30, 2021.

These options had a grant date fair value ranging between $ 3.44 -$ 6.14 per option.

The fair value of the stock options granted is calculated using the Black-Scholes option-pricing model as prescribed by ASC 718 using the following assumptions:

Six months ended

June 30, 2022

June 30, 2021

Nine months ended

September 30, 2022

September 30, 2021

Expected term (years)

3 unchanged sentences

Expected dividend yield over expected term

There were no stock options exercised during each of the six months ended June 30, 2021 and 2022, respectively.

There were no stock options exercised during each of the nine months ended September 30, 2021 and 2022, respectively.

The Company does not expect to be able to benefit from the deduction for stock option exercises that may occur because the company has tax loss carryforwards from prior periods that would be expected to offset any potential taxable income.

In the second quarter of 2022, the Company amended the terms of 11,952 options and 2,374 restricted stock units issued to a former director.

Specifically, the Company accelerated the vesting of 4,748 options and 2,374 restricted stock units that otherwise would have been forfeited upon the director’s retirement of service.

In addition, the Company extended the time by which the director could exercise all vested awards from 90 days to two years.

Specifically, the Company accelerated the vesting of 4,748 options and 2,374 restricted stock units that otherwise would have been forfeited upon the director’s retirement from service.

In addition, the Company extended the time by which the director may exercise all vested awards from 90 days to two years .

The Company recorded an additional $ 3,500 of compensation cost in the second quarter of 2022 as a result of these modifications.

4 unchanged sentences

Cancelled/forfeited

Options outstanding at June 30, 2022

Unvested at June 30, 2022

Vested and exercisable at June 30, 2022

Options outstanding at September 30, 2022

Unvested at September 30, 2022

Vested and exercisable at September 30, 2022

Restricted Stock Units

The Company issued 118,665 restricted stock units during the six months ended June 30, 2022.

The Company issued 118,665 restricted stock units during the nine months ended September 30, 2022.

These restricted stock units will vest over a period of one year for grants to directors and three years for grants to employees.

3 unchanged sentences

Each restricted stock unit was valued at $ 6.69 based on their fair value at the date of grant, which is equivalent to the market price of a share of the Company’s common stock.

Summarized information for restricted stock units as of June 30, 2022 is as follows:

Summarized information for restricted stock units as of September 30, 2022 is as follows:

Value Per Share

Restricted Stock Units outstanding at December 31, 2021

Restricted Stock Units outstanding at June 30, 2022

Unvested at June 30, 2022

Vested and exercisable at June 30, 2022

Restricted Stock Units outstanding at September 30, 2022

Unvested at September 30, 2022

Vested and exercisable at September 30, 2022

Stockholders Equity

1 unchanged sentence

On August 12, 2021, the Company entered into a Controlled Equity Offering Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co.

("Cantor"), pursuant to which it may issue and sell, from time to time, shares of its common stock having an aggregate offering price of up to $ 10.0 million through Cantor as the sales agent.

Cantor may sell the Company’s common stock by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) of the Securities Act.

Subject to the terms and conditions of the Sales Agreement, Cantor will use commercially reasonable efforts consistent with its normal trading and sales practices to sell shares of the Company’s common stock from time to time, based upon the Company's instructions, including any price, time or size limits specified by the Company.

The Company has provided Cantor with customary indemnification rights, and Cantor will be entitled to a commission at a fixed rate equal to 3.0 % of the gross proceeds per share sold.

The Company has no obligation to sell any of the shares and may at any time suspend sales under the Sales Agreement or terminate the Sales Agreement.

As of June 30, 2022, a total of 2,092,167 shares, for gross proceeds of approximately $ 5.9 million, have been sold pursuant to this agreement.

("Cantor"), pursuant to which the Company could issue and sell, from time to time, shares of its common stock having an aggregate offering price of up to $ 10.0 million through Cantor as the sales agent.

Cantor could sell the Company’s common stock by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) of the Securities Act.

On August 12, 2022, the Company became aware that the shelf registration statement on Form S-3 (file number 333-231923) (the “Registration Statement”) associated with this Sales Agreement had expired on June 21, 2022.

Prior to becoming aware of the expiration, the Company sold an aggregate of 3,117,100 shares of its common stock at the market price, following the expiration of the Registration Statement and through August 12, 2022, for aggregate proceeds of approximately $4,494,496.

There was no sale of shares after August 12, 2022.

The sale of these shares may be subject to potential rescission rights by certain shareholders.

As of September 30, 2022, there have been no claims or demands to exercise such rights.

As a result of these potential rescission rights, the Company reclassified 3,117,100 shares, with an aggregate purchase price of $4,494,496 of its common stock as outside stockholders’ equity.

The reclassification of these shares shall remain for a period of one year from the applicable transaction date.

These shares have been treated as issued and outstanding for financial reporting purposes.

On August 15, 2022, due to expiry of the Registration Statement, the Sales Agreement was mutually terminated.

Since the start of the agreement on August 12, 2021, a total of 3,281,067 shares, for gross proceeds of approximately $ 7.6 million, had been sold pursuant to the Sales Agreement.

March 2021 Equity Financing

3 unchanged sentences

December 2020 Equity Financing

On December 18, 2020, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Acorn Bioventures, LP (the “Purchaser”), pursuant to which the Company agreed to offer, issue and sell to the Purchaser, (i) in a registered direct offering, (a) an aggregate of 485,912 shares (the “Common Shares”) of common stock, par value $ 0.001 per share (“Common Stock”), and (b) an aggregate of 237,745 shares of Series B Convertible Preferred Stock (the “Preferred Shares,” and collectively with the Common Shares, the “Shares”), par value $ 0.001 per share (“Series B Preferred Stock”), and (ii) in a concurrent private placement, warrants (the “Warrants”) to purchase up to an aggregate of 669,854 shares (the “Warrant Shares”) of Common Stock.

common stock, par value $ 0.001 per share (“Common Stock”), and (b) an aggregate of 237,745 shares of Series B Convertible Preferred Stock (the “Preferred Shares,” and collectively with the Common Shares, the “Shares”), par value $ 0.001 per share (“Series B Preferred Stock”), and (ii) in a concurrent private placement, warrants (the “Warrants”) to purchase up to an aggregate of 669,854 shares (the “Warrant Shares”) of Common Stock.

The combined purchase price for each Share, together with one Warrant to purchase 0.4 shares of Common Stock, is $ 4.18 .

12 unchanged sentences

The closing of the offering occurred on December 22, 2020 and the net proceeds to the Company were approximately $ 6.9 million, after deducting offering expenses payable by the Company.

As of June 30, 2022, 237,745 shares of the Series B Preferred Stock remained issued and outstanding.

As of September 30, 2022, 237,745 shares of the Series B Preferred Stock remained issued and outstanding.

April 2020 Equity Financing

12 unchanged sentences

December 2020 Warrants

As of June 30, 2021, warrants to purchase 669,854 shares of common stock remained outstanding.

As of September 30, 2022, warrants to purchase 669,854 shares of common stock remained outstanding.

Each warrant shall be exercisable beginning on the 12-month anniversary of the date of issuance for a period of five years after the date of issuance, at an exercise price of $ 4.13 per Warrant Share.

1 unchanged sentence

The warrants may be exercised on a “cashless” basis.

There were no exercises of these warrants during the three and six months ended June 30, 2022 or June 30, 2021.

There were no exercises of these warrants during the three and nine months ended September 30, 2022 or September 30, 2021.

April 2020 Warrants

As of June 30, 2022, 2,190,000 warrants issued in connection with the April 2020 equity financing remained outstanding, each with an exercise price of $ 5.00 .

As of September 30, 2022, 2,190,000 warrants issued in connection with the April 2020 equity financing remained outstanding, each with an exercise price of $ 5.00 .

All such warrants were issued in connection with the April 2020 co-placement agency agreement.

7 unchanged sentences

In lieu of fractional shares, the Company will round down to the next whole share.

There were no warrants exercised during the three or six months ended June 30, 2022, and a total of 909,000 warrants exercised during the three and six months ended June 30, 2021.

There were no warrants exercised during the three and nine months ended September 30, 2022, and a total of 909,000 warrants exercised during the three and nine months ended September 30, 2021.

July 2017 Warrants

As of June 30, 2021, 374,525 warrants issued in connection with the July 2017 underwritten public offering remained outstanding, each with an exercise price of $ 40.00 .

As of September 30, 2021, 374,525 warrants issued in connection with the July 2017 underwritten public offering remained outstanding, each with an exercise price of $ 40.00 .

All such warrants were issued in connection with the July 2017 underwritten public offering and are immediately exercisable.

5 unchanged sentences

Prior to the exercise of any warrants to purchase common stock, holders of the warrants will not have any of the rights of holders of the common stock purchasable upon exercise, including the right to vote, except as set forth therein.

There were no exercises of these warrants during the three and six months ended June 30, 2022 or June 30, 2021.

There were no exercises of these warrants during the three and nine months ended September 30, 2022 or September 30, 2021.

Series A Preferred Stock

1 unchanged sentence

During the year ended December 31, 2017, 8,608 shares of the Series A Preferred Stock were converted into 215,200 shares of common stock.

As of June 30, 2022, 264 shares of the Series A Preferred Stock remained issued and outstanding .

As of September 30, 2022, 264 shares of the Series A Preferred Stock remained issued and outstanding .

Each share of Series A Preferred Stock is convertible at any time at the option of the holder thereof, into a number of shares of common stock determined by dividing $ 1,000 by the initial conversion price of $ 40.00 per share, subject to a 4.99 % blocker provision, or, upon election by a holder prior to the issuance of shares of Series A Preferred Stock, 9.99 %, and is subject to adjustment for stock splits, stock dividends, distributions, subdivisions and combinations.

The 264 shares of Series A Preferred Stock issued and outstanding at June 30, 2022, are convertible into 6,600 shares of common stock.

The 264 shares of Series A Preferred Stock issued and outstanding at September 30, 2022 are convertible into 6,600 shares of common stock.

In the event of a liquidation, the holders of shares of the Series A Preferred Stock shall be permitted to participate on an as-converted-to-common-stock basis in any distribution of assets of the Company.

1 unchanged sentence

There is no restriction on the Company’s ability to repurchase shares of Series A Preferred Stock while there is any arrearage in the payment of dividends on such shares, and there are no sinking fund provisions applicable to the Series A Preferred Stock.

Subject to certain conditions, at any time following the issuance of the Series A Preferred Stock, the Company has the right to cause each holder of the Series A Preferred Stock to convert all or part of such holder’s Series A Preferred Stock in the event that (i) the volume weighted average price of our common stock for 30 consecutive trading days (the “Measurement Period”) exceeds 300 % of the initial conversion price of the Series A Preferred Stock (subject to adjustment for forward and reverse stock splits, recapitalizations, stock dividends and similar transactions), (ii) the daily trading volume on each Trading Day during such Measurement Period exceeds $ 500,000 per trading day and (iii) the holder is not in possession of any information that constitutes or might constitute, material non-public information which was provided by the Company.

information which was provided by the Company.

The right to cause each holder of the Series A Preferred Stock to convert all or part of such holder’s Series A Preferred Stock shall be exercised ratably among the holders of the then outstanding preferred stock.

2 unchanged sentences

6 % Convertible Exchangeable Preferred Stock

As of June 30, 2022, there were 335,273 shares of the Company’s 6 % Convertible Exchangeable Preferred Stock (the “ 6 % Preferred Stock”) issued and outstanding at an issue price of $ 10.00 per share.

As of September 30, 2022, there were 335,273 shares of the Company’s 6 % Convertible Exchangeable Preferred Stock (the “ 6 % Preferred Stock”) issued and outstanding at an issue price of $ 10.00 per share.

Dividends on the 6 % Preferred Stock are cumulative from the date of original issuance at the annual rate of 6 % of the liquidation preference of the 6 % Preferred Stock, payable quarterly on the first day of February, May, August and November, commencing February 1, 2005.

1 unchanged sentence

The 6 % Preferred Stock has a liquidation preference of $ 10.00 per share, plus accrued and unpaid dividends.

As of June 30, 2022, accrued and unpaid dividends amounted to $ 50,291 .

As of September 30, 2022, accrued and unpaid dividends amounted to $ 50,291 .

The Company may automatically convert the 6% Preferred Stock into common stock if the per share closing price of the Company’s common stock has exceeded $59,220, which is 150% of the conversion price of the 6% Preferred Stock, for at least 20 trading days during any 30 day trading period, ending within five trading days prior to notice of automatic conversion.

6 unchanged sentences

Dividends on 6% Preferred Stock

On June 14, 2022 , the board of directors declared a quarterly cash dividend in the amount of $ 0.15 per share on the Company’s Preferred Stock.

The cash dividend was paid on August 1, 2022 to the holders of record of the 6 % Preferred Stock as of the close of business on July 15, 2022 .

August 2021 Controlled Equity Offering Sales Agreement

Subsequent to the quarter ended June 30, 2022, under the Sales Agreement, the Company sold a further 1,188,900 shares, for net proceeds of approximately $1.6 million.

On September 7, 2022 , the board of directors declared a quarterly cash dividend in the amount of $ 0.15 per share on the Company’s Preferred Stock.

The cash dividend was paid on November 1, 2022 to the holders of record of the 6 % Preferred Stock as of the close of business on October 14, 2022 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements