What changed in this filing

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Item 1. Financial Statements

2022-08-12 compared with 2022-05-16 · 344 added, 246 removed, 261 unchanged (69% of the section changed)

1 unchanged sentence

Balance Sheets

and cash equivalents

transaction costs

tax receivable

Cash and cash

Deferred transaction costs

Payroll tax receivable

current assets

and equipment, net

lease right-of-use assets

Property and equipment, net

Operating lease right-of-use

and Stockholders’ Equity:

lease liabilities

Accounts payable

Finance lease liabilities

Operating lease liabilities

current liabilities

lease liabilities

payable, non-current

Finance lease liabilities

Operating lease liabilities

Note payable, non-current

Stockholders’

stock, $ 0.001 par value:

2,500,000 shares authorized;

0 shares issued and outstanding as of March 31, 2022 and December 31, 2021

stock, $ 0.001 par value:

Preferred stock, $ 0.001 par value:

2,500,000 shares authorized;

14,920,302 and 14,918,887 shares issued and outstanding as of March 31, 2022

issued and outstanding as of June 30, 2022 and December 31, 2021

Common stock, $ 0.001 par value:

30,000,000 and 25,000,000 shares authorized

as of June 30, 2022 and December 31, 2021, respectively;

14,941,334 and 14,918,887 shares issued and outstanding as of June 30, 2022

and December 31, 2021, respectively

paid-in capital

Additional paid-in capital

Accumulated deficit

( 73,821,820 )

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Statements of Operations

Months Ended March 31,

and development

and administrative

operating expenses

from operations

Months Ended June 30,

Research and development

General and administrative

Total operating expenses

Loss from operations

( 9,600,727 )

( 13,643,468 )

income (expense)

on sale of fixed assets

income (expense), net

( 17,108,332 )

( 16,435,238 )

Other income (expense)

Interest expense

Interest income

Loss on sale of fixed

Other income (expense),

loss before income taxes

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( 16,824,520 )

loss per share, basic and diluted

average common shares outstanding, basic and diluted

Income tax benefits

$ ( 9,960,526 )

$ ( 14,032,852 )

$ ( 17,894,973 )

$ ( 16,824,520 )

Net loss per share, basic and diluted

Weighted average common shares outstanding,

basic and diluted

accompanying notes to the financial statements

Statements of Changes in Stockholders’ Equity

Months Ended March 31, 2022

at December 31, 2021

and Six Months Ended June 30, 2022

Balance at December 31, 2021

$ 124,622,405

$ ( 55,926,847 )

of common stock options, net of shares withheld for exercise price

Stock-based compensation

Exercise of common stock options, net of shares withheld for exercise

( 7,934,447 )

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$ ( 63,861,294 )

Stock-based compensation

Employee stock purchases

Exercise of common stock options, net of shares withheld for exercise

( 9,960,526 )

at June 30, 2022 (unaudited)

$ 126,995,610

$ ( 73,821,820 )

accompanying notes to the financial statements

Statements of Changes in Stockholders’ Equity

Months Ended March 31, 2021

at December 31, 2020

and Six Months Ended June 30, 2021

Balance at December 31, 2020

$ ( 26,321,581 )

of common stock warrants

of common stock options, net of shares withheld for exercise price

of common stock upon closing of follow-on offering, net of underwriting discounts and offering costs

of common stock in an at-the-market (“ATM”) offering

costs associated with ATM offering

Stock-based compensation

Exercise of common stock warrants

Exercise of common stock options, net of shares withheld for exercise

Issuance of common stock upon closing of follow-on

offering, net of underwriting discounts and offering costs

Issuance of common stock in an at-the-market

(“ATM”) offering

Issuance costs associated with ATM offering

( 2,791,668 )

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$ ( 29,113,249 )

Stock-based compensation

Employee stock purchases

Exercise of common stock options, net of shares withheld for exercise

Issuance of common stock warrants, note payable

Issuance of common stock, licensing agreement

( 14,032,852 )

at June 30, 2021 (unaudited)

$ ( 43,146,101 )

accompanying notes to the financial statements

Statements of Cash Flows

Months Ended March 31,

Months Ended June 30,

flows from operating activities:

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$ ( 16,824,520 )

to reconcile net loss to net cash used for operations:

of debt issuance costs and discount

on sale of fixed assets

in operating assets and liabilities:

tax receivable

assets and deposits

Adjustments to reconcile net loss to net cash

used for operations:

Stock-based compensation

Issuance of common stock,

licensing agreement

Amortization of debt issuance

costs and discount

Payment-in-Kind interest

Loss on sale of fixed assets

Changes in operating assets and liabilities:

Payroll tax receivable

Prepaid assets and deposits

( 3,879,197 )

Accounts payable

Accrued expenses

operating lease, net

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flows from investing activities:

of property and equipment

from sale of property and equipment

Purchases of property and equipment

Proceeds from sale of

property and equipment

cash used for investing activities

flows from financing activities:

from exercise of common stock warrants

from exercise of employee stock options

from follow-on offering, net of underwriting discounts and offering costs

proceeds from an ATM offering

for secondary registration statement costs

for finance leases

cash (used for) provided by financing activities

change in cash and cash equivalents

Proceeds from exercise of common stock warrants

Proceeds from exercise of employee stock options

Proceeds from employee stock purchases

Proceeds from follow-on offering, net of underwriting

discounts and offering costs

Proceeds from note payable, net of debt issuance

costs and discount of $ 652,061

Gross proceeds from an ATM offering

Payments for secondary registration statement

Payments for finance leases

Net cash provided by financing

Net change in cash and

cash equivalents

( 17,375,557 )

and cash equivalents:

disclosure of cash flow information:

Beginning of period

End of period

Supplemental disclosure

of cash flow information:

Interest paid

disclosures of non-cash investing and financing activities:

and registration statement costs included in accounts payable

and equipment included in accounts payable

Offering and registration statement costs included

in accounts payable

Offering and registration statement costs included

in accrued expenses

Issuance of common stock warrants and final

fee recognized as discount to note payable

accompanying notes to the financial statements

TO CONDENSED FINANCIAL STATEMENTS (unaudited)

the Three Months Ended March 31, 2022 and 2021)

Inc., a Delaware corporation (the “Company”), is a clinical-stage biotechnology company seeking to extend the lives of cancer

patients by pursuing an integrated therapeutic and companion diagnostic strategy.

The company’s lead therapeutic candidate is gedatolisib,

a potent, reversible dual inhibitor that selectively targets all Class I isoforms of PI3K and mTOR.

Its mechanism of action and pharmacokinetic

properties are highly differentiated from other currently approved and investigational therapies that target PI3K or mTOR alone or together.

The company expects to initiate a Phase 3 study evaluating gedatolisib in patients with HR+/HER2- advanced breast cancer in 2022.

CELsignia companion diagnostic platform is uniquely able to analyze live patient tumor cells to identify new groups of cancer patients

likely to benefit from already approved targeted therapies.

the Three and Six Months Ended June 30, 2022 and 2021)

Inc., a Delaware corporation (the “Company”), is a clinical-stage biotechnology company focused on development of targeted

therapies for hormonally driven cancers.

The company’s lead therapeutic candidate is gedatolisib, a potent, reversible dual inhibitor

that selectively targets all Class I PI3K isoforms and mTOR.

Its mechanism of action and pharmacokinetic properties are highly differentiated

from other currently approved and investigational therapies that target PI3K or mTOR alone or together.

The company expects to initiate

a Phase 3 study evaluating gedatolisib in patients with HR+/HER2- advanced breast cancer in 2022.

Its CELsignia companion diagnostic

platform is uniquely able to analyze live patient tumor cells to identify new groups of cancer patients likely to benefit from already

approved targeted therapies.

The Company was co-founded in 2012 by Brian F.

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and the related footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

results for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected during the remainder of

the current year or for any future period.

results for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected during the remainder

of the current year or for any future period.

uses estimates and assumptions in preparing these unaudited condensed financial statements in accordance with U.S.

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Company is subject to risks common to companies in the development stage including, but not limited to, dependency on, the clinical and

commercial success of its diagnostic tests, ability to obtain regulatory approval of its diagnostic tests, the clinical and commercial

success of its initial drug product, gedatolisib, the need for substantial additional financing to achieve its goals, uncertainty of

broad adoption of its approved products, if any, by physicians and consumers, and significant competition.

commercial success of its initial drug product, gedatolisib, the clinical and commercial success of its diagnostic tests, ability to

obtain regulatory approval of its drug product, gedatolisib, ability to obtain regulatory approval of its diagnostic tests, the need

for substantial additional financing to achieve its goals, uncertainty of broad adoption of its approved products, if any, by physicians

and consumers, and significant competition.

Company records prepaid assets or accrued expenses for prepaid or estimated clinical trial costs conducted by third-party service providers,

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which adoption of such standards is required for public companies that are not emerging growth companies.

Adopted Accounting Pronouncements

August 2020, the FASB issued ASU No.

2020-06, Debt - Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging

- Contracts in Entity’s Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s

Own Equity (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required

under current U.S.

ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for derivative

scope exceptions and also simplifies the diluted earnings per share calculation in certain areas.

The standard is effective for public

business entities, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years and interim

periods within those fiscal years beginning after December 15, 2021.

For all other entities, the standard will be effective for fiscal

years beginning after December 15, 2023.

Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020,

and adoption must be as of the beginning of the Company’s annual fiscal year.

The Company’s early adoption of this accounting

standard on April 8, 2021, in conjunction with the closing of a loan agreement, did not have an impact on the Company’s financial

statements and related disclosures.

Net Loss Per Common Share

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Therefore, the weighted-average shares outstanding used to

calculate both basic and diluted loss per common share are the same.

the three months ended March 31, 2022 and 2021, potentially dilutive securities excluded from the computations of diluted weighted-average

calculate both basic and diluted loss per common share is the same.

the three and six months ended June 30, 2022 and 2021, potentially dilutive securities excluded from the computations of diluted weighted-average

shares outstanding were options to purchase 1,782,782 and 1,023,513 shares of common stock, respectively, warrants to purchase 377,652

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lease agreement for building space.

The new lease commenced, and the Company moved to the facility in May 2018, in conjunction with the

termination of its then existing lease.

The lease commenced, and the Company moved to the facility in May 2018, in conjunction with the termination

of its then existing lease.

Rent expense is recorded on a straight-line basis over the lease term.

In July 2020, the Company

signed an amendment to extend this lease through April 30, 2022.

The lease amendment provides for monthly rent, real estate taxes and

operating expenses.

In July 2020, the Company signed an

amendment to extend this lease through April 30, 2022.

The lease amendment provides for monthly rent, real estate taxes and operating

As a result of the lease amendment, the Company recorded an incremental $ 197,211 in the operating right-of-use (“ROU”)

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date in determining the present value of the lease payments.

balance sheet information consisted of the following at March 31, 2022:

balance sheet information consisted of the following at June 30, 2022:

of Supplemental Balance Sheet Information Related to Leases

lease liability

Operating Lease

Operating lease liability

short term portion

and equipment

Finance Lease

Furniture and equipment

Accumulated depreciation

book value of property and equipment under finance lease

lease liability

Finance lease liability

short term portion

analysis under lease agreements consisted of the following as of March 31, 2022:

analysis under lease agreements consisted of the following as of June 30, 2022:

of Maturity Analysis Under Lease Agreements

Operating Leases

Finance Leases

Total minimum lease payments

minimum lease payments

Present value discount

Less amount representing services

Present value of net minimum lease payments

Discount Rate

amount representing services

value of net minimum lease payments

Weighted Average

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Finance lease

costs for the period ended March 31, 2022:

costs for the period ended June 30, 2022:

Schedule of Lease Costs

Total lease cost

cash flow information related to leases period ended March 31, 2022:

Operating lease cost

Finance lease cost:

Variable lease cost

cash flow information related to leases period ended June 30, 2022:

of Supplemental Cash Flow Information Related to Leases

paid for amounts included in operating and finance leases:

cash outflow from operating leases

cash outflow from finance leases

Cash paid for amounts included in operating

and finance leases:

Operating cash

outflow from operating leases

Operating cash outflow

from finance leases

cash outflow from finance leases

Total cash paid for amounts

included in operating and finance leases

cash paid for amounts included in operating and finance leases

Research Studies

Company enters into contracts in the normal course of business for clinical trials, preclinical studies, manufacturing and other services

and products for operating purposes.

The Company currently has five Phase 2 clinical trial agreements in place to evaluate targeted therapies

selected with one of our CELsignia tests.

The Company also has a license agreement in place with Pfizer to research, develop, manufacture

and commercialize gedatolisib.

In conjunction with the license agreement, the Company continued a Phase 1b study – B2151009 related

to gedatolisib.

Company enters into contracts in the normal course of business to conduct research and development programs internally and through

third parties that include, among others, arrangements with vendors, consultants, CMOs, and CROs.

The Company currently has

five Phase 2 clinical trial agreements in place to evaluate targeted therapies selected with one of our CELsignia tests.

milestone payments related to the Phase 2 clinical trials are uncertain and the contracts generally provide for termination

following a certain period after notice, therefore the Company believes that non-cancelable obligations under the agreements are not

The Company also has a license agreement in place with Pfizer to research, develop, manufacture and commercialize

In conjunction with the license agreement, the Company continued a Phase 1b study – B2151009 related to

These patients subsequently transitioned to an Expanded Access study – CELC-G-001.

Timing of milestone payments

related to the Phase 2 clinical trials are uncertain and the contracts generally provide for termination following a certain period after

notice, therefore the Company believes that non-cancelable obligations under the agreements are not material.

Contracts related to the

Phase 1b study, the Expanded Access study, and the Phase 3 clinical study to date, are generally based on time and material.

Contracts related to the Phase

1b study and the Expanded Access study, are generally based on time and material.

In addition, contracts related to the

Company’s forthcoming Phase 3 clinical study (VIKTORIA-1) are generally cancelable with

reasonable notice within 120 days and the Company’s obligations under these contracts are primarily based on services

performed through termination dates plus certain cancelation charges, if any, as defined in each of the respective agreements.

addition, these agreements may, from time to time, be subjected to amendments as a result of any change orders executed by the

As of June 30, 2022, the Company had only one material non-cancelable contractual commitment with respect to these arrangements,

which totaled approximately $ 2,600,000 .

Stockholders’ Equity

May 15, 2022, the Company entered into a securities purchase agreement with certain institutional and other accredited investors for

the sale of Company common stock, preferred stock that may be convertible into common stock and warrants initially exercisable for preferred

stock for $ 100 million in the aggregate, before deducting placement agent fees and other offering expenses.

Pursuant to the securities

purchase agreement, investors will purchase shares of common stock and preferred stock at a price per share of $ 5.75 (on an as converted

to common stock basis).

For each share of common stock and each 1/10 of a share of preferred stock purchased, investors will receive

a warrant initially exercisable for preferred stock equivalent to 0.40 shares of common stock on an as converted basis.

price of the warrants will be at a 40 % premium to the price paid by investors for the initial shares of common stock purchased in the

private placement.

The preferred stock will be convertible into common stock at the holder’s election, subject to certain limitations

such as beneficial ownership and the approval by the Company’s stockholders to increase the number of authorized shares of common

stock sufficient to cover the shares of common stock issuable upon conversion of (i) the preferred stock purchased in the private placement

and (ii) the shares of preferred stock that may be issued upon exercise of warrants purchased in the private placement.

are initially exercisable for preferred stock and will convert into warrants to purchase common stock if the proposed increase in the

Company’s authorized common stock is approved by stockholders.

The closing of the private placement is conditioned on, among other

customary items, the first patient enrolled in the Company’s forthcoming Phase 3 clinical study (VIKTORIA-1) having received their

first dose of treatment at a clinical site located in the United States, provided that such date must occur on or before December 31,

The Company also entered into a customary registration rights agreement with the investors pursuant to which it agreed to file

a registration statement with the SEC registering the resale of (i) the shares of common stock to be issued and sold in the private placement,

(ii) the shares of common stock issuable upon conversion of the preferred stock purchased in the private placement and (iii) the shares

of common stock issuable upon conversion of the shares of preferred stock that may be issued upon exercise of warrants purchased in the

private placement.

February 4, 2022, the Company entered into an Open Market Sale Agreement SM with Jefferies LLC, as agent (“Jefferies”),

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price of up to $ 50,000,000 .

We will pay Jefferies a commission equal to 3.0 % of the aggregate gross proceeds from each sale of such shares.

To date, we have not yet made any sales under this arrangement.

The Company will pay Jefferies a commission equal to 3.0 % of the aggregate gross proceeds from each sale

of such shares.

To date, the Company has not yet made any sales under this arrangement.

July 1, 2021, the Company completed a follow-on offering whereby it sold 2,250,000 shares of common stock at a public offering price

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offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended.

the three months ended March 31, 2022 and 2021, the Company sold 0 and 3,082 shares, respectively, of common stock pursuant to the ATM

Agreement, at an average selling price of $ 12.64 per share.

the six months ended June 30, 2022 and 2021, the Company sold 0 and 3,082 shares, respectively, of common stock pursuant to the ATM Agreement,

at an average selling price of $ 12.64 per share.

February 23, 2021, in conjunction with the Company’s follow-on offering, the ATM Agreement was terminated.

Stock-Based Compensation

following table summarizes the activity for all stock options outstanding for the three months ended March 31:

following table summarizes the activity for all stock options outstanding for the six months ended June 30:

of Stock Options Activity

Average Exercise Price

outstanding at beginning of year

exercisable at March 31:

Average Grant Date Fair Value for options granted during the period:

following table summarizes additional information about stock options outstanding and exercisable at March 31, 2022:

Exercise Price

Options outstanding at beginning

Balance at June 30

Options exercisable

Weighted Average Grant Date Fair Value for

options granted during the period:

following table summarizes additional information about stock options outstanding and exercisable at June 30, 2022:

of Stock Options Outstanding and Exercisable

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Intrinsic Value

Company recognized stock-based compensation expense for stock options of $ 709,509 and $ 418,192 for the three months ended March 31, 2022

Company recognized stock-based compensation expense for stock options of $ 1,460,031 and $ 520,361 for the three months ended June 30,

2022 and 2021, respectively and $ 2,169,540 and $ 938,553 for the six months ended June 30, 2022 and 2021, respectively.

In May 2022, the

Company modified the exercise price on 776,324 stock option awards to $ 5.50 , the closing market price on the Nasdaq Capital Market on

May 17, 2022.

The effect of this modification on stock-based compensation was $ 428,343 for the three- and six-months ending June 30,

The effect of this modification on stock-based compensation over the remaining service period will be approximately $ 444,000 .

December 2021, the Company modified the exercise price on 311,000 stock option awards to $ 13.44 , the closing market price on the Nasdaq

Capital Market on December 15, 2021.

No director or officer awards were modified.

The effect of this modification on stock-based compensation

was $ 25,755 and $ 0 for the three months ended June 30, 2022 and 2021, respectively and $ 53,784 and $ 0 for the six months ended June 30,

2022 and 2021, respectively.

In December 2021, the Company modified the exercise price on 311,000 stock option awards to $ 13.44 , the closing

market price on the Nasdaq Capital Market on December 15, 2021.

The effect of this modification on stock-based compensation over the remaining service period will be approximately

In May 2020, the Company modified the exercise price on 203,750 stock option awards to $ 5.10 , the closing market price on the

Nasdaq Capital Market on May 14, 2020.

No director or officer awards were modified.

The effect of this modification

on stock-based compensation was $ 28,029 and $ 0 for the three months ended March 31, 2022 and 2021, respectively.

The effect of this modification

on stock-based compensation over the remaining service period will be approximately $ 316,000 .

In May 2020, the Company modified the exercise

price on 203,750 stock option awards to $ 5.10 , the closing market price on the Nasdaq Capital Market on May 14, 2020.

No director or

officer awards were modified.

The effect of this modification on stock-based compensation was $ 11,614 and $ 13,449 for the three months

ended March 31, 2022 and 2021, respectively.

The effect of this modification on stock-based compensation over the remaining service period

will be approximately $ 73,000 .

The effect of this modification on stock-based compensation

was $ 11,601 and $ 12,790 for the three months ended June 30, 2022 and 2021, respectively and $ 23,216 and $ 26,239 for the six months ended

June 30, 2022 and 2021.

The effect of this modification on stock-based compensation over the remaining service period will be approximately

Black-Scholes option-pricing model was used to estimate the fair value of equity-based awards with the following weighted-average assumptions

for the three months ended March 31:

for the six months ended June 30:

of Assumptions for Fair Value of Equity-based Awards

interest rate

dividend yield

Risk-free interest rate

Expected volatility

Expected life (years)

Expected dividend

inputs for the Black-Scholes valuation model require management’s significant assumptions.

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The risk-free interest rates are based on the rate for U.S.

securities at the date of grant with maturity dates approximately equal to the expected life at the grant date.

The expected life is

based on the simplified method in accordance with the SEC Staff Accounting Bulletin Nos.

The expected volatility is estimated

based on historical volatility information of peer companies that are publicly available in combination with the Company’s calculated

volatility since being publicly traded.

securities at the date of grant with maturity dates approximately

equal to the expected life at the grant date.

The expected life is based on the simplified method in accordance with the SEC Staff Accounting

Bulletin Nos.

The expected volatility is estimated based on historical volatility information of peer companies that are

publicly available in combination with the Company’s calculated volatility since being publicly traded.

assumptions used to calculate the grant date fair value of non-employee options are generally consistent with the assumptions used for

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with the agreements would also be cancelled.

restricted stock awards were granted during the three months ended March 31, 2022 and 2021.

The Company had 2,964 and 15,686 shares of

restricted stock outstanding as of March 31, 2022 and 2021, respectively, and 0 shares of restricted stock vested during the three months

ended March 31, 2022 and 2021.

The Company recognized stock-based compensation expense for restricted stock of $ 20,344 and $ 20,456 for

the three months ended March 31, 2022 and 2021, respectively.

Company initially reserved a maximum of 750,000 shares of common stock for issuance under the 2017 Amended and Restated Stock Incentive

Plan (the “2017 Plan”).

The number of shares reserved for issuance was automatically increased by 102,540 , 102,998 and 149,189

shares on January 1, 2020, 2021 and 2022, respectively, and will increase automatically on January 1 of each of 2023 through 2027 by

the number of shares equal to 1.0% of the aggregate number of outstanding shares of Company common stock as of the immediately preceding

December 31 .

At the Annual Meeting held on May 12, 2021, the stockholders approved a one-time, 500,000 increase to the number of shares

reserved for issuance under the 2017 Plan.

However, the Company’s board may reduce the amount of the increase in any particular

The total remaining shares available for grant under the Company’s 2017 Plan as of March 31, 2022 was 398,445 .

stock awards were granted to members of the Company’s board during the three months ended June 30, 2022 and 2021.

The Company had

3,273 and 2,964 shares of restricted stock outstanding as of June 30, 2022 and 2021, respectively, and 2,964 and 15,686 shares of restricted

stock vested during the three months ended June 30, 2022 and 2021.

The Company recognized stock-based compensation expense for restricted

stock of $ 6,775 and $ 18,112 for the three months ended June 30, 2022 and 2021, respectively and $ 27,119 and $ 38,567 for the six months

ended June 30, 2022 and 2021, respectively.

Company initially reserved a maximum of 750,000

shares of common stock for issuance under the 2017 Amended and Restated Stock Incentive Plan (the “2017 Plan”).

number of shares reserved for issuance was automatically increased by 102,540 , 102,998

shares on January 1, 2020, 2021 and 2022, respectively, and will increase

automatically on January 1 of each of 2023 through 2027 by the number of shares equal to 1.0% of the aggregate number of outstanding

shares of Company common stock as of the immediately preceding December 31 .

However, the Company’s board may reduce the

amount of the increase in any particular year.

At the Annual Meeting held on May 12, 2021 and May 12, 2022, the stockholders

approved a one-time, 500,000

increase each year for a total increase of 1,000,000

to the number of shares reserved for issuance under the 2017 Plan.

The total remaining shares available for grant under the

Company’s 2017 Plan as of June 30, 2022 was 463,925 .

unrecognized compensation cost related to stock options and restricted stock is estimated to be recognized as follows:

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estimated compensation cost to be recognized

Company recognized stock-based compensation expense related to its employee stock purchase plan of $ 26,148 and $ 10,450 for the three

months ended March 31, 2022 and 2021, respectively.

The Company initially reserved a total of 100,000 shares for issuance under the employee

stock purchase plan.

The number of shares reserved for issuance was automatically increased by 51,270 , 51,499 and 74,594 shares on January

1, 2020, 2021 and 2022, respectively, and will increase automatically on each subsequent January 1 by the number of shares equal to 0.5%

of the total outstanding number of shares of Company common stock as of the immediately preceding December 31.

However, the Company’s

board may reduce the amount of the increase in any particular year.

The total remaining shares available for issuance under the employee

stock purchase plan as of March 31, 2022 was 224,817 .

Company recognized total stock-based compensation expense as follows for the three months ended March 31:

of Stock-based Compensation Expense

compensation expense in operating expenses:

and development

Company recognized stock-based compensation expense related to its employee stock purchase plan of $ 52,653 and $ 1,844 for the three months

ended June 30, 2022 and 2021, respectively and $ 79,071 and $ 12,295 for the six months ended June 30, 2022 and 2021, respectively.

Company initially reserved a total of 100,000 shares for issuance under the employee stock purchase plan.

The number of shares reserved

for issuance was automatically increased by 51,270 , 51,499 and 74,594 shares on January 1, 2020, 2021 and 2022, respectively, and will

increase automatically on each subsequent January 1 by the number of shares equal to 0.5% of the total outstanding number of shares of

Company common stock as of the immediately preceding December 31.

However, the Company’s board may reduce the amount of the increase

in any particular year.

The total remaining shares available for issuance under the employee stock purchase plan as of June 30, 2022

was 208,929 .

Company recognized total stock-based compensation expense as follows for the three and six months ended June 30:

Schedule of Stock-based Compensation Expense

Stock-based compensation expense in operating

and administrative

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million term C loan to be funded upon request of the Company no later than March 31, 2023 (collectively the “Term Loans”).

Funding of the term B and C loan is subject to the Company’s ability to achieve certain milestones.

The Company is no longer eligible

to draw on the term B loan.

The Company is no longer eligible to draw on the term B loan.

Funding of the term C loan is subject to the Company’s ability to

achieve certain milestones.

The Innovatus Loan Agreement is secured by a lien covering substantially all assets of the Company.

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price per share of the Company’s stock for the five-trading day period ending on the last trading day immediately preceding the

funding date of the Term B or Term C Loan, as applicable.

The warrants may be exercised on a cashless basis and are immediately exercisable

through the tenth anniversary of the applicable funding date.

In connection with the first tranche of the Term Loans, the Company issued

a warrant to Innovatus to purchase 26,042 shares of the Company’s common stock at an exercise price of $ 14.40 per share.

evaluated the warrant under ASC 470, debt, and recognized an additional debt discount of approximately $ 0.3 million based on the relative

fair value of the base instruments and warrants.

funding date of the Term C Loan .

The warrants may be exercised on a cashless basis and are immediately exercisable through the tenth

anniversary of the applicable funding date.

In connection with the first tranche of the Term Loans, the Company issued a warrant to Innovatus

to purchase 26,042 shares of the Company’s common stock at an exercise price of $ 14.40 per share.

The Company evaluated the warrant

under ASC 470, debt, and recognized an additional debt discount of approximately $ 0.3 million based on the relative fair value of the

base instruments and warrants.

The Company calculated the fair value of the warrant using the Black-Scholes model.

The Company is also required to maintain a minimum cash balance in agreement with the term loans’

default terms.

Company is also required to maintain a minimum cash balance in agreement with the term loans’ default terms.

Company is entitled to make interest-only payments for thirty-six months, or up to forty-eight months if certain conditions are met.

17 unchanged sentences

method over the life of the Term Loans.

The carrying value of the debt approximates fair value as of March 31, 2022.

The carrying value of the debt approximates fair value as of June 30, 2022.

debt consisted of the following:

Schedule of Long-term Debt

PIK interest (added to principal)

unamortized debt issuance costs

Payment-in-Kind interest

(added to principal)

unamortized debt

issuance costs

unamortized debt discount

long-term debt

Total long-term debt

principal payments, including the final fee, are as follows:

2 unchanged sentences

April 8, 2021, the Company entered into a license agreement with Pfizer to research, develop, manufacture and commercialize gedatolisib,

a potent, well-tolerated, reversible dual inhibitor that targets PI3K and mTOR, for the treatment, diagnosis and prevention of all diseases.

The Company paid Pfizer $ 5.0 million in upfront fees and issued to Pfizer $ 5.0 million of shares of the Company’s common stock

pursuant to an Equity Grant Agreement.

The upfront payment and the issuance of shares were expensed to research & development in

full for the three months ending June 30, 2021.

a potent, well-tolerated, reversible dual inhibitor that selectively targets all Class I PI3K isoforms and mTOR.

The Company paid Pfizer

$ 5.0 million in upfront fees and issued to Pfizer $ 5.0 million of shares of the Company’s common stock pursuant to an Equity Grant

The upfront payment and the issuance of shares were expensed to research & development in full for the three months ending

June 30, 2021.

Company is also required to make milestone payments to Pfizer upon achievement of certain development and commercial milestone events,

16 unchanged sentences

Subsequent Events

May 15, 2022, the Company entered into a securities purchase agreement with certain institutional and other accredited

investors for the sale of Company common stock, preferred stock that may be convertible into common stock and warrants

initially exercisable for preferred stock for $ 100

million in the aggregate, before deducting

placement agent fees and other offering expenses.

Pursuant to the securities purchase agreement, investors will purchase shares of common

stock and preferred stock at a price per share of $ 5.75 (on an as converted to common stock basis).

For each share of common stock

and each 1/10 of a share of preferred stock purchased, investors will receive a warrant initially exercisable for preferred stock equivalent

to 0.40 shares of common stock on an as converted basis.

The exercise price of the warrants will be at a 40 % premium to the price

paid by investors for the initial shares of common stock purchased in the private placement.

The preferred stock will be convertible

into common stock at the holder’s election, subject to certain limitations such as beneficial ownership and the approval by the

Company’s stockholders to increase the number of authorized shares of common stock sufficient to cover the shares of common stock

issuable upon conversion of (i) the preferred stock purchased in the private placement and (ii) the shares of preferred stock that may

be issued upon exercise of warrants purchased in the private placement.

The warrants are initially exercisable for preferred stock and

will convert into warrants to purchase common stock if the proposed increase in the Company’s authorized common stock is approved

by stockholders.

The closing of the private placement is conditioned on, among other customary items, the first patient enrolled

in the Company’s forthcoming Phase 3 clinical study (VIKTORIA-1) having received their first dose of treatment at

a clinical site located in the United States, provided that such date must occur on or before December 31, 2022.

The Company also

entered into a customary registration rights agreement with the investors pursuant to which it agreed to file a registration statement

with the SEC registering the resale of (i) the shares of common stock to be issued and sold in the private placement,

(ii) the shares of common stock issuable upon conversion of the preferred stock purchased in the private placement and

(iii) the shares of common stock issuable upon conversion of the shares of preferred stock that may be issued upon

exercise of warrants purchased in the private placement.

July 27, 2022, the Company signed an amendment to exercise the option to extend the operating lease for building space for a period

The commencement of the extended period is May 1, 2023 and will terminate on April 30, 2024.

On August 9, 2022, the

Company amended the Loan Agreement described in Note 7 above.

Under the amended Loan Agreement, Innovatus, as Lender, has agreed to loan

up to $ 75 million, a $ 50 million increase from the original Loan Agreement, in five tranches consisting of:

(i) a $ 15 million term

A loan that was funded on April 8, 2021 upon entering into the original Loan Agreement, (ii) a $ 20 million term B loan to be funded upon

request of the Company no later than December 31, 2022, with such funding conditioned upon the closing of the Company’s $ 100 million

private placement announced on May 16, 2022, (iii) a $ 10 million term C loan to be funded upon request of the Company no later than April

1, 2024, (iv) a $ 20 million term D loan to be funded upon request of the Company no later than November 1, 2024, and (v) a $ 10 million

term E loan to be funded upon request of the Company no later than February 28, 2025.

Funding of the term B loan is conditioned upon

the closing of the Company’s $ 100 million private placement announced on May 16, 2022, and funding of the term C, D and E loans

are conditioned upon satisfaction of certain clinical trial milestones and certain financial covenants determined on a pro forma as-funded

Under the amended Loan Agreement, Innovatus has the

right, at its election and until August 9, 2025, the third anniversary of the loan amendment date, to convert into Common Stock up to:

(i) 20% of the outstanding principal amount of term A loan, and (ii) an additional 7% of the amount by which the aggregate principal amount

of the funded term B, C, D and E loans exceed $35 million, provided that the aggregate outstanding principal amount of all term loans

is at least $35 million, with such conversion based upon a price per share equal to $10.00.

The Company is entitled to make interest-only

payments for forty-eight months, or up to sixty months from the original loan agreement date if certain conditions are met.

Loans will mature on April 8, 2027, the sixth anniversary of the initial funding date, and will bear interest at a rate equal to sum

of (a) the greater of (i) Prime Rate (as defined in the amended Loan Agreement) or (ii) 3.25%,

Additionally, the Company elected to make 4.95% of

the interest rate as payable in-kind, which shall accrue as principal monthly.

The Amended Loan Agreement includes certain other

fees, such as a final fee of 4.5% of the funded loan amounts not converted into equity by the lender, which apply if prepayment, an

event of default, or change of control occurs prior to August 9, 2025, the third anniversary of the Amendment date.

certain other conditions, no final fee will be payable after August 9, 2025.

The Company has the option to prepay the loan at any time

following the first anniversary of the amended loan agreement date, with tiered prepayment fees ranging from 0 – 1% based on

when the prepayment occurs.

Upon a change in control or event of default, mandatory prepayment will be required, and if such an

event occurs prior to the first anniversary of the Amendment date, an additional prepayment fee of 3.0 % applies.

The amended Loan Agreement remains secured by all

assets of the Company.

Proceeds will be used for working capital purposes and to fund the Company’s general business requirements.

The amended Loan Agreement contains customary representations and warranties and covenants, subject to customary carve outs, and includes

financial covenants related to or based upon liquidity, trailing twelve months revenue and the funded loan amounts.

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