What changed in this filing

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Item 1. Financial Statements

2023-08-11 compared with 2023-05-15 · 152 added, 115 removed, 309 unchanged (46% of the section changed)

1 unchanged sentence

Balance Sheets

March 31, 2023

June 30, 2023

December 31, 2022

19 unchanged sentences

Total Liabilities

Commitments and Contingencies (Note 5)

and Contingencies (Note 5)

Stockholders’ Equity:

1 unchanged sentence

2,500,000 shares authorized;

1,095,873 and 1,120,873 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively

1,085,873 and 1,120,873 shares issued and outstanding as of June 30, 2023 and December 31, 2022

Common stock, $ 0.001 par value:

65,000,000 shares authorized;

21,941,372 and 21,667,250 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively

65,000,000 shares authorized as of June 30, 2023 and December 31, 2022, respectively;

22,081,893 and 21,667,250 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively

Additional paid-in capital

8 unchanged sentences

Statements of Operations

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Operating expenses:

5 unchanged sentences

( 9,600,727 )

( 27,603,022 )

( 17,108,332 )

Other income (expense)

1 unchanged sentence

( 1,314,996 )

( 2,557,008 )

Interest income

3 unchanged sentences

( 9,960,526 )

( 26,526,104 )

( 17,894,973 )

Income tax benefits

1 unchanged sentence

$ ( 9,960,526 )

$ ( 26,526,104 )

$ ( 17,894,973 )

Net loss per share, basic and diluted

Net loss per share, basic

Weighted average common shares outstanding, basic and diluted

Weighted average common shares outstanding, basic

accompanying notes to the financial statements

of Changes in Stockholders’ Equity

Months Ended March 31,2023

Statements of Changes in Stockholders’ Equity

and Six Months Ended June 30, 2023

Preferred Stock

14 unchanged sentences

$ 123,226,768

Stock-based compensation

Employee stock purchases

Conversion of preferred to common stock

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

( 14,587,687 )

Balance at June 30, 2023 (unaudited)

$ 232,932,164

$ ( 122,822,991 )

$ 110,132,341

accompanying notes to the financial statements

Statements of Changes in Stockholders’ Equity

Months Ended March 31,2022

and Six Months Ended June 30, 2022

Additional Paid-In

9 unchanged sentences

$ ( 63,861,294 )

Stock-based compensation

Employee stock purchases

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

( 9,960,526 )

Balance at June 30, 2022 (unaudited)

$ 126,995,610

$ ( 73,821,820 )

accompanying notes to the financial statements

Statements of Cash Flows

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

4 unchanged sentences

Amortization of debt issuance costs and discount

Payment-in-Kind interest

Non-cash operating lease, net

Change in accrued interest income

( 1,697,811 )

Changes in operating assets and liabilities:

1 unchanged sentence

Prepaid assets and deposits

( 3,879,197 )

Accounts payable

Accrued expenses

( 1,020,102 )

Net cash used for operating activities

2 unchanged sentences

Cash flows from investing activities:

Proceeds from maturities of investments

Purchases of investments

( 113,903,646 )

Proceeds from maturities of investments

Purchases of property and equipment

2 unchanged sentences

Proceeds from exercise of employee stock options

Proceeds from employee stock purchases

Payments for secondary registration statement costs

11 unchanged sentences

Offering and registration statement costs included in accounts payable

Offering and registration statement costs included in accrued expenses

Property and equipment included in accounts payable

1 unchanged sentence

TO CONDENSED FINANCIAL STATEMENTS (unaudited)

the Three Months Ended March 31, 2023 and 2022)

the Three and Six Months Ended June 30, 2023 and 2022)

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

27 unchanged sentences

and the related footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

results for the three months ended March 31, 2023 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, 2023 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.

38 unchanged sentences

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, 2023 and 2022, 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, 2023 and 2022, potentially dilutive securities excluded from the computations of diluted weighted-average

shares outstanding were preferred stock on an as-if-converted to common stock basis of 10,858,730 and zero shares of common stock, respectively,

5 unchanged sentences

the establishment of an allowance for credit losses.

All of the Company’s held-to-maturity

investment securities are U.S.

Treasury and agencies securities that are guaranteed or otherwise

supported by the United States government and have no history of credit losses.

Accordingly, the Company does not expect to incur any

credit losses on held-to-maturity investment securities and has no allowance

for credit losses recorded for these securities.

following table summarizes the Company’s held-to-maturity investment securities at amortized cost as of March 31, 2023

and December 31, 2022:

of Investment

All of the Company’s held-to-maturity investment securities are U.S.

and agencies securities that are guaranteed or otherwise supported by the United States government and have no history of credit losses.

Accordingly, the Company does not expect to incur any credit losses on held-to-maturity investment securities and has no allowance for

credit losses recorded for these securities.

following table summarizes the Company’s held-to-maturity investment securities at amortized cost as of June 30, 2023 and December

Schedule of Investment

Amortized Cost, as Adjusted

2 unchanged sentences

Estimated Fair Value

March 31, 2023

Gross Unrealized

Holding Gains

Estimated Fair

Governmental Agency Securities

Treasury Notes

June 30, 2023

Amortized Cost, as Adjusted

Gross Unrealized Holding Gains

Gross Unrealized Holding Losses

Estimated Fair Value

Treasury Bills

$ 114,005,385

$ 114,035,885

$ 114,005,385

$ 114,035,885

Amortized Cost, as Adjusted

3 unchanged sentences

December 31, 2022

Gross Unrealized

Holding Gains

Estimated Fair

Amortized Cost, as Adjusted

Gross Unrealized Holding Gains

Gross Unrealized Holding Losses

Estimated Fair Value

Governmental Agency Securities

Treasury Notes

Treasury Bills

$ 144,015,954

$ 144,087,110

Company had no investments as of March 31, 2022.

and Finance Leases

Company leases its corporate space in Minneapolis, Minnesota.

In March 2023, the Company signed the fourth amendment to extend this lease

through April 30, 2026.

This amendment provides for monthly rent, real estate taxes and operating expenses.

The Company recorded an incremental

$ 355,578 in the operating right-of-use (“ROU”) asset and lease liability pertaining to this amendment.

fair value of the Company’s held-to-maturity debt securities is determined based upon inputs, other than the quoted prices in

active markets, that are observable either directly or indirectly and are classified as level 2 fair value instruments.

Company leases its corporate space in Minneapolis, Minnesota, with an operating lease in place through April 30, 2026.

The lease provides

for monthly rent, real estate taxes, and operating expenses.

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

March 2023, the Company signed the fourth amendment to extend this lease through April 30, 2026.

This amendment provides for monthly

rent, real estate taxes and operating expenses.

The Company recorded an incremental $ 355,578 in the operating right-of-use (“ROU”)

asset and lease liability pertaining to this amendment.

Research Studies

11 unchanged sentences

to an Expanded Access study – CELC-G-001.

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 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.

In addition, these

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

As of March 31,

2023, the Company had only one material non-cancelable contractual commitment with respect to these arrangements, which totaled approximately

$ 2.2 million.

Stockholders’ Equity

Contracts related to the Expanded Access study, are generally based on time and material.

In addition, contracts related to the Company’s 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.

In addition, these agreements may, from

time to time, be subjected to amendments as a result of any change orders executed by the parties.

As of June 30, 2023, the Company had

only one material non-cancelable contractual commitment with respect to these arrangements, which totaled approximately $ 2.0 million.

Stockholders’

December 31, 2022, the Company’s authorized capital stock consisted of 65,000,000 shares of $ .001 par value common stock, of which

4 unchanged sentences

the shares transferred is $ 5.75 per share.

March 31, 2023, the Company’s authorized capital stock consisted of 65,000,000 shares of common stock, of which 21,941,372 shares

June 29, 2023, one of the Company’s preferred shareholders elected to convert 10,000 shares of Series A Convertible Preferred Stock

into 100,0000 shares of Common Stock, in accordance with the Securities Purchase Agreement dated May 15, 2022.

The cost basis of the

shares transferred is $ 5.75 per share.

June 30, 2023, the Company’s authorized capital stock consisted of 65,000,000 shares of common stock, of which 22,081,893 shares

were outstanding, and 2,500,000 shares of preferred stock, including 1,850,000 shares designated as Series A Preferred Stock, of which

1,085,873 shares were outstanding.

As of March 31, 2023, no dividends have been declared on the Company’s capital stock.

As of June 30, 2023, no dividends have been declared on the Company’s capital stock.

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

Exercise Price

Weighted Average Exercise Price

Options outstanding at beginning of year

Balance at March 31

Options exercisable at March 31:

Balance at June 30

Options exercisable at June 30:

Weighted 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, 2023:

following table summarizes additional information about stock options outstanding and exercisable at June 30, 2023:

of Stock Options Outstanding and Exercisable

8 unchanged sentences

Aggregate Intrinsic Value

Company recognized stock-based compensation expense for stock options of $ 1,222,328 and $ 709,509 for the three months ended March 31,

2023 and 2022, 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 $ 39,612 and

$ 0 for the three months ending March 31, 2023 and 2022, respectively.

The effect of this modification on stock-based compensation over

the remaining service period will be approximately $ 277,000 .

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.

No director or officer awards were

The effect of this modification on stock-based compensation was $ 16,924 and $ 28,029 for the three months ended March 31, 2023

Company recognized stock-based compensation expense for stock options of $ 1,228,284 and $ 1,460,031 for the three months ended June 30,

2023 and 2022, respectively, and $ 2,450,612 and $ 2,169,540 for the six months ended June 30, 2023 and 2022, respectively.

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 $ 37,690 and $ 428,343 for the three months ending June

30, 2023 and 2022, respectively, and $ 77,302 and $ 428,343 for the six months ending June 30, 2023 and 2022, respectively.

The effect of

this modification on stock-based compensation over the remaining service period will be approximately $ 228,000 .

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.

No director or officer awards were modified.

The effect of this modification on stock-based compensation was $ 16,920

and $ 25,755 for the three months ended June 30, 2023 and 2022, respectively, and $ 33,844 and $ 53,784 for the six months ended June 30,

2023 and 2022, respectively.

4 unchanged sentences

The effect of this modification on stock-based compensation

was $ 7,108 and $ 11,614 for the three months ended March 31, 2023 and 2022, respectively.

The effect of this modification on stock-based

compensation over the remaining service period will be approximately $ 13,000 .

was $ 6,826 and $ 11,601 for the three months ended June 30, 2023 and 2022, respectively, and $ 13,934 and $ 23,216 for the six months ended

June 30, 2023 and 2022.

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

23 unchanged sentences

with the agreements would also be cancelled.

restricted stock awards were granted during the three months ended March 31, 2023 and 2022.

The Company had 3,273 and 2,964 shares of

restricted stock outstanding as of March 31, 2023 and 2022, respectively, and 0 shares of restricted stock vested during the three months

ended March 31, 2023 and 2022.

The Company recognized stock-based compensation expense for restricted stock of $ 4,642 and $ 20,344 for

the three months ended March 31, 2023 and 2022, 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 102,998 , 149,189

shares on January 1, 2021, 2022 and 2023, respectively, and will increase

automatically on January 1 of each year from 2024 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 and May 12, 2022, the stockholders approved a one-time, 500,000

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

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 year.

The total remaining shares available for grant under the Company’s 2017 Plan as

of March 31, 2023 was 343,114 .

stock awards were granted to members of the Company’s board during the three months ended June 30, 2023 and 2022.

The Company had

1,958 and 3,273 shares of restricted stock outstanding as of June 30, 2023 and 2022, respectively, and 3,273 and 2,964 shares of restricted

stock vested during the three months ended June 30, 2023 and 2022, respectively.

The Company recognized stock-based compensation expense

for restricted stock of $ 4,052 and $ 6,775 for the three months ended June 30, 2023 and 2022, respectively, and $ 8,694 and $ 27,119 for

the six months ended June 30, 2023 and 2022, 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 102,998 , 149,189 and 216,673

shares on January 1, 2021, 2022 and 2023, respectively, and will increase automatically on January 1 of each year from 2024 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, subject to the board’s discretion to reduce the amount of the increase in any particular year.

At the Annual Meetings

held on May 12, 2021 and May 12, 2022, the stockholders approved a one-time, 500,000 increase each year for a total of 1,000,000 increase,

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

At the Annual Meeting held on May 11, 2023, the stockholders approved

a one-time, 1,500,000 increase 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, 2023 was 1,702,461 .

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

2 unchanged sentences

Company recognized stock-based compensation expense related to its employee stock purchase plan of $ 44,646 and $ 52,653 for the three

months ended March 31, 2023 and 2022, 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 51,499 , 74,594 and 108,337 shares on January

1, 2021, 2022 and 2023, 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, 2023 was 300,485 .

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

months ended June 30, 2023 and 2022, respectively, and $ 90,958 and $ 79,071 for the six months ended June 30, 2023 and 2022, 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 51,499 , 74,594 and 108,337 shares on January 1, 2021, 2022 and 2023, 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, 2023

was 283,008 .

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

of Stock-based Compensation Expense

Three Months Ended

Six Months Ended

Stock-based compensation expense in operating expenses:

6 unchanged sentences

to $ 75 million, a $ 50 million increase from the original Loan Amount.

As of March 31, 2023, term loans totaling $ 35 million are outstanding

As of June 30, 2023, term loans totaling $ 35 million are outstanding

under the Loan Agreement, including the initial Term A loan of $ 15 million which was funded on April 8, 2021, and a $ 20 million Term

B loan which was funded on December 22, 2022.

debt consisted of the following at March 31, 2023 and December 31, 2022:

debt consisted of the following at June 30, 2023 and December 31, 2022:

of Long-term Debt

March 31, 2023

June 30, 2023

December 31, 2022

6 unchanged sentences

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