What changed in this filing

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Item 1. Financial Statements

2024-05-15 compared with 2023-11-13 · 165 added, 235 removed, 274 unchanged (59% of the section changed)

1 unchanged sentence

Balance Sheets

September 30, 2023

March 31, 2024

December 31, 2023

10 unchanged sentences

Accounts payable

Finance lease liabilities

Operating lease liabilities

8 unchanged sentences

2,500,000 shares authorized;

1,060,873 and 1,120,873 shares issued and outstanding as of September 30, 2023 and December 31, 2022

505,277 and 854,134 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively

Common stock, $ 0.001 par value:

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

22,369,393 and 21,667,250 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively

65,000,000 shares authorized;

30,773,895 and 25,506,012 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively

Additional paid-in capital

8 unchanged sentences

Statements of Operations

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

Operating expenses:

5 unchanged sentences

( 12,547,537 )

( 46,501,059 )

( 27,751,887 )

Other income (expense)

2 unchanged sentences

( 1,242,012 )

( 1,428,108 )

Interest income

Other income (expense), net

( 1,036,807 )

Other income, net

Net loss before income taxes

1 unchanged sentence

( 11,938,417 )

( 44,930,644 )

( 28,788,694 )

Income tax benefits

1 unchanged sentence

$ ( 11,938,417 )

$ ( 44,930,644 )

$ ( 28,788,694 )

Net loss per share, basic and diluted

1 unchanged sentence

accompanying notes to the financial statements

Statements of Changes in Stockholders’ Equity

and Nine Months Ended September 30, 2023

Preferred Stock

Additional Paid-In

Balance at December 31, 2022

$ 230,045,566

$ ( 96,296,887 )

$ 133,771,467

Stock-based compensation

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

Conversion of preferred to common stock

Issuance costs associated with private placement offering

( 11,938,417 )

Balance at March 31, 2023 (unaudited)

$ 231,439,035

$ ( 108,235,304 )

$ 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 )

of Changes in Stockholders’ Equity

Months Ended March 31, 2024

at December 31, 2023

$ 299,818,965

Balance at June 30, 2023

$ ( 160,076,003 )

$ 139,769,322

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

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

of preferred to common stock

( 21,612,455 )

Stock-based compensation

Conversion of preferred to common stock

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

( 21,612,455 )

at March 31, 2024 (unaudited)

$ 315,393,843

at September 30, 2023 (unaudited)

$ ( 181,688,458 )

1 unchanged sentence

accompanying notes to the financial statements

Statements of Changes in Stockholders’ Equity

and Nine Months Ended September 30, 2022

of Changes in Stockholders’ Equity

Months Ended March 31, 2023

Preferred Stock

Additional Paid-In

2 unchanged sentences

$ ( 96,296,887 )

Stock-based compensation

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

$ 133,771,467

$ 230,045,566

Balance at March 31, 2022

$ ( 96,296,887 )

1 unchanged sentence

Stock-based compensation

Employee stock purchases

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

Conversion of preferred to common stock

Issuance costs associated with private placement offering

( 11,938,417 )

Balance at June 30, 2022

Balance at March 31, 2023 (unaudited)

$ 231,439,035

$ ( 108,235,304 )

Stock-based compensation

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

$ 123,226,768

$ 231,439,035

at September 30, 2022 (unaudited)

$ ( 108,235,304 )

2 unchanged sentences

Statements of Cash Flows

Nine Months Ended September 30,

Three Months Ended March 31,

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:

Other current assets

( 1,065,732 )

( 5,817,737 )

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

( 121,435,343 )

( 3,125,462 )

Proceeds from maturities of investments

Purchases of property and equipment

Net cash provided by (used for) investing activities

Net cash provided by investing activities

Cash flows from financing activities:

Proceeds from exercise of common stock warrants

Proceeds from exercise of employee stock options

Proceeds from employee stock purchases

Payments for secondary registration statement costs

1 unchanged sentence

Payments for finance leases

Net cash provided by (used for) financing activities

Net cash provided by financing activities

Net change in cash and cash equivalents

( 26,802,605 )

Cash and cash equivalents:

5 unchanged sentences

Offering and registration statement costs included in accounts payable

Deferred financing costs and offering and registration statement costs included in accrued expenses

Property and equipment included in accounts payable

Property and equipment included in accrued expenses

Exercise of stock options pending receipt of cash proceeds

accompanying notes to the financial statements

TO CONDENSED FINANCIAL STATEMENTS (unaudited)

the Three and Nine Months Ended September 30, 2023 and 2022)

the Three Months Ended March 31, 2024 and 2023)

Inc., a Delaware corporation (the “Company”), is a clinical-stage biotechnology company pursuing development for oncology.

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A Phase 1b/2 clinical trial, CELC-G-201, evaluating gedatolisib

in combination with darolutamide in patients with metastatic castration resistant prostate cancer, is expected to be initiated in the

first quarter of 2024.

The company’s 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

in combination with darolutamide in patients with metastatic castration resistant prostate cancer, was initiated in the first quarter

of 2024 and is currently enrolling patients.

The Company’s 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.

was co-founded in 2012 by Brian F.

Sullivan and Dr.

Laing and is based in Minnesota.

The Company has not generated any revenues to date.

The Company has not generated any revenues

Basis of Presentation, Summary of Significant Accounting Policies and Recent Accounting Pronouncements

12 unchanged sentences

and the related footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

results for the three and nine months ended September 30, 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 months ended March 31, 2024 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 and initial drug product, gedatolisib,

the clinical and commercial success of gedatolisib, the need for substantial additional financing to achieve its goals, uncertainty of

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.

7 unchanged sentences

As the current VIKTORIA-1

Phase 3 trial ramps up site activation and patient enrollment, the Company’s estimated expenses in future periods and actual services

performed may vary from these estimates, and these estimates may become more significant.

Changes in these estimates that result in material

changes to the Company’s prepaid assets or accrued expenses could materially affect the Company’s results of operations.

Adopted Accounting Pronouncements

June 2016 and related amendments, the FASB issued Accounting Standards Update (ASU) No.

2016-13, Financial Instruments – Credit

Losses (Topic 326).

This guidance changes the methodology to be used to measure credit losses for certain financial instruments and financial

The new methodology requires the recognition of an allowance that reflects the current estimate of credit losses expected to

be incurred over the life of the financial asset.

The Company adopted this standard effective January 1, 2023.

The adoption of the standard

did not have a material impact on the Company’s consolidated financial statements.

Phase 3 and CELC-G-201 Phase 1b/2 trials ramp up site activation and patient enrollment, the Company’s estimated expenses in future

periods and actual services performed may vary from these estimates, and these estimates may become more significant.

Changes in these

estimates that result in material changes to the Company’s prepaid assets or accrued expenses could materially affect the Company’s

results of operations.

Net Loss Per Common Share

4 unchanged sentences

Therefore, the weighted-average

shares outstanding used to calculate both basic and diluted loss per common share is the same.

the three and nine months ended September 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 10,608,730 and zero shares of

common stock, respectively, options to purchase 2,702,629 and 1,919,114 shares of common stock, respectively, warrants to purchase 7,266,102

and 309,652 shares of common stock, respectively, and 1,958 and 3,273 shares of restricted common stock, respectively.

shares outstanding used to calculate both basic and diluted loss per common share are the same.

following table summarizes the potentially-dilutive shares excluded from the diluted weighted-average shares outstanding:

Schedule of Potentially-Dilutive Shares Excluded from Diluted Weighted-Average Shares Outstanding

Preferred stock on an as-if-converted to common stock basis

Options to purchase common stock

Warrants to purchase common stock

Restricted common stock

warrant shares of 5,747,787 and zero are included in the computation of basic and diluted net loss per share for the periods ended March

31, 2024, and March 31, 2023, respectively, as the pre-funded warrants are exercisable for nominal consideration.

securities for which the Company has the positive intent and ability to hold to maturity are classified as held-to-maturity and reported

9 unchanged sentences

for credit losses recorded for these securities.

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

December 31, 2022:

following tables summarize the Company’s held-to-maturity investment securities at amortized cost as of March 31, 2024 and December

Schedule of Investment

Amortized Cost, as Adjusted

Gross Unrealized Holding Gains

Gross Unrealized Holding Losses

Estimated Fair Value

September 30, 2023

Amortized Cost, as Adjusted

Gross Unrealized Holding Gains

Gross Unrealized Holding Losses

Estimated Fair Value

March 31, 2024

Amortized Cost,

Holding Gains

Holding Losses

Treasury Bills

3 unchanged sentences

$ 146,445,784

Amortized Cost, as Adjusted

Gross Unrealized Holding Gains

Gross Unrealized Holding Losses

Estimated Fair Value

December 31, 2023

Amortized Cost, as Adjusted

Gross Unrealized Holding Gains

Gross Unrealized Holding Losses

Estimated Fair Value

Governmental Agency Securities

Amortized Cost,

Holding Gains

Holding Losses

Treasury Bills

1 unchanged sentence

$ 149,950,969

$ 149,919,974

$ 149,950,969

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.

and Finance Leases

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

2 unchanged sentences

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

1 unchanged sentence

parties that include, among others, arrangements with vendors, consultants, CMO’s, and CRO’s.

The Company currently has four

The Company currently has three

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

7 unchanged sentences

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

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

In addition, contracts related to the Company’s Phase 3 (VIKTORIA-1) and Phase 1b/2 (CELC-G-201) clinical trials 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.

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

As of September

30, 2023, the Company had two material non-cancelable contractual commitments with respect to these arrangements, which totaled approximately

$ 2.3 million.

Stockholders’ Equity

Contracts related to the Phase 1B and the Expanded Access studies are generally based

on time and material.

In addition, contracts related to the Company’s Phase 3 clinical study (VIKTORIA-1) and Phase 1b/2 clinical

study (CELC-G-201) 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, 2024, the Company had two material non-cancelable contractual commitments with respect to these

arrangements, which totaled approximately $ 2.0 million.

Stockholders’

December 31, 2023, the Company’s authorized capital stock consisted of 65,000,000 shares of $ .001 par value common stock, of which

25,506,012 shares were outstanding, and 2,500,000 shares of $ .001 par value preferred stock, of which 854,134 shares were outstanding.

January 15, 2024, one of the Company’s preferred shareholders elected to convert 224,244 shares of Series A Convertible Preferred

Stock into 2,242,440 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.

March 14, 2024, one of the Company’s preferred shareholders elected to convert 50,000 shares of Series A Convertible Preferred

2 unchanged sentences

the shares transferred is $ 5.75 per share.

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.

September 21, 2023, one of the Company’s preferred shareholders elected to convert 25,000 shares of Series A Convertible Preferred

March 15, 2024, one of the Company’s investors exercised 1,739,080

of common stock warrants at an exercise price of $ 8.05 ,

which generated approximately $ 14

million in cash.

The warrants were issued pursuant to the Securities Purchase Agreement dated May 15, 2022, that closed and was

funded on December 9, 2022.

Additional common stock warrants of 3,683

from several investors were exercised, which generated approximately $ 9,000 in

cash in the first quarter of 2024.

The 3,683 common stock warrants were net of shares withheld for exercise price.

March 19, 2024, one of the Company’s preferred shareholders elected to convert 43,913 shares of Series A Convertible Preferred

Stock into 439,130 shares of Common Stock, in accordance with the Securities Purchase Agreement dated May 15, 2022.

1 unchanged sentence

the shares transferred is $ 5.75 per share.

September 30, 2023, the Company’s authorized capital stock consisted of 65,000,000 shares of common stock, of which 22,369,393

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

of which 1,060,873 shares were outstanding.

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

March 26, 2024, one of the Company’s preferred shareholders elected to convert 30,700 shares of Series A Convertible Preferred

Stock into 307,000 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.

March 31, 2024, the Company’s authorized capital stock consisted of 65,000,000 shares of common stock, of which 30,773,895 shares

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

505,277 shares were outstanding.

As of March 31, 2024, 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 nine months ended September 30:

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

Schedule of Stock Options Activity

Weighted Average Exercise Price

Exercise Price

Options outstanding at beginning of year

Balance at September 30

Options exercisable at September 30:

Balance at March 31

Options exercisable at March 31:

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

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

following table summarizes additional information about stock options outstanding and exercisable at March 31, 2024:

Schedule of Stock Options Outstanding and Exercisable

1 unchanged sentence

Options Exercisable

Options Outstanding

Weighted Average Remaining Contractual Life

Weighted Average Exercise Price

Aggregate Intrinsic Value

Options Exercisable

Weighted Average Exercise Price

Aggregate Intrinsic Value

Company recognized stock-based compensation expense for stock options of $ 1,065,568 and $ 1,162,751 for the three months ended September

30, 2023 and 2022, respectively, and $ 3,516,180 and $ 3,329,969 for the nine months ended September 30, 2023 and 2022, respectively.

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 $ 30,188 and $ 49,088 for the three months ending

September 30, 2023 and 2022, respectively, and $ 107,490 and $ 477,431 for the nine months ending September 30, 2023 and 2022, respectively.

The effect of this modification on stock-based compensation over the remaining service period will be approximately $ 190,000 .

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.

Exercise Price

Company recognized stock-based compensation expense for stock options of $ 1,290,193 and $ 1,222,328 for the three months ended March 31,

2024 and 2023, 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 $ 26,719 and

$ 39,612 for the three months ending March 31, 2024 and 2023, respectively.

The effect of this modification on stock-based compensation

was $ 15,773 and $ 21,778 for the three months ended September 30, 2023 and 2022, respectively, and $ 49,617 and $ 75,562 for the nine months

ended September 30, 2023 and 2022, respectively.

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

period will be approximately $ 114,000 .

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.

over the remaining service period will be approximately $ 137,000 .

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 $ 15,764 and $ 16,924 for the three months ended March 31,

2024 and 2023, respectively.

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 $ 3,041 and $ 7,681 for the three months ended September 30, 2023 and 2022, respectively,

and $ 16,975 and $ 30,897 for the nine months ended September 30, 2023 and 2022.

The effect of this modification on stock-based compensation

over the remaining service period will be approximately $ 3,000 .

was $ 696 and $ 7,108 for the three months ended March 31, 2024 and 2023, respectively.

The effect of this modification on stock-based

compensation over the remaining service period will be $ 0 .

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

for the nine months ended September 30:

for the three months ended March 31:

Schedule of Assumptions for Fair Value of Equity-based Awards

3 unchanged sentences

Expected volatility

78.0 to 79.8 %

76.2 % - 79.6 %

Expected life (years)

17 unchanged sentences

with the agreements would also be cancelled.

Company had 1,958 and 3,273 shares of restricted stock outstanding as of September 30, 2023 and 2022, respectively, and 0 and 250 shares

of restricted stock vested during the three months ended September 30, 2023 and 2022, respectively.

The Company recognized stock-based

compensation expense for restricted stock of $ 4,903 and $ 7,245 for the three months ended September 30, 2023 and 2022, respectively,

and $ 13,597 and $ 36,686 for the nine months ended September 30, 2023 and 2022, respectively.

restricted stock awards were granted during the three months ended March 31, 2024 and 2023.

The Company had 1,958 and 3,273 shares of

restricted stock outstanding as of March 31, 2024 and 2023, respectively, and 0 shares of restricted stock vested during the three months

ended March 31, 2024 and 2023.

The Company recognized stock-based compensation expense for restricted stock of $ 4,849 and $ 4,642 for

the three months ended March 31, 2024 and 2023, 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 September 30, 2023 was 1,147,899 .

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

The number of shares reserved for issuance was automatically increased by 102,998 , 149,189 , 216,673 ,

and 255,060 shares on January 1, 2021, 2022, 2023, and 2024, respectively, and will increase automatically on January 1 of each year

from 2025 through 2028 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

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.

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.

remaining shares available for grant under the Company’s 2017 Plan as of March 31, 2024 was 1,003,414 .

unrecognized compensation cost related to stock options and restricted stock is estimated to be recognized at March 31, 2024:

Schedule of Unrecognized Compensation Cost

1 unchanged sentence

Company recognized stock-based compensation expense related to its employee stock purchase plan of $ 36,304 and $ 46,312 for the three

months ended September 30, 2023 and 2022, respectively and $ 129,125 and $ 132,129 for the nine months ended September 30, 2023 and 2022,

respectively.

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

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

September 30, 2023 was 283,008 .

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

months ended March 31, 2024 and 2023, 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 , 108,337 , and 127,530 shares

on January 1, 2021, 2022, 2023, and 2024, 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.

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, 2024 was 394,165 .

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

Schedule of Stock-based Compensation Expense

Three Months Ended

Nine Months Ended

September 30,

Stock-based compensation expense in operating expenses:

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

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

As of March 31, 2024, 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 September 30, 2023 and December 31, 2022:

March 29, 2024, the Company entered into a second amendment to its existing Loan Agreement to extend the date through which the Company

may draw on the Term C Loan from April 1, 2024 to June 1, 2024.

Other than as set forth in the second amendment, the amended Loan Agreement

shall continue in full force and effect without alteration or amendment.

debt consisted of the following at March 31, 2024 and December 31, 2023:

Schedule of Long-term Debt

September 30, 2023

December 31, 2022

PIK interest (added to principal)

4 unchanged sentences

Schedule of Long Term Debt Future Principal Payments

Subsequent Events

October 18, 2023, the Company entered into a securities purchase agreement with certain investors (the “Investors”) pursuant

to which the Company agreed to sell to the Investors in a private placement (the “Private Placement”) pre-funded warrants

(the “Warrants”) to purchase up to 5,747,787 shares of the Company’s common stock, par value $ 0.001 per share (the

“Common Stock”).

Each Warrant is immediately exercisable and will not expire.

Each warrant to purchase one share has a purchase

price of $ 8.699 per share, and an exercise price of $ 0.001 per share for the Common Stock issuable upon exercise of the Warrant.

closing of the Private Placement occurred on October 20, 2023 and resulted in gross proceeds to the Company of approximately $ 50 million,

before deducting offering expenses payable by the Company.

connection with the Private Placement, the Company entered into a Registration Rights Agreement (the “Registration Rights Agreement”)

with the Investors, pursuant to which the Company has agreed to file, no later than 30 days following the Closing Date of the Private

Placement, a registration statement covering the resale by the Investors of the shares issued or issuable upon exercise or exchange of

the Warrants (as defined more specifically in the Registration Rights Agreement, the “Registrable Securities”).

the event that a registration statement covering the Registrable Securities is not filed with the SEC on or prior to the filing deadline

as set forth in the Registration Rights Agreement, or is not declared effective within the timeframe provided therein, or if certain

other circumstances occur, as described in the Registration Rights Agreement, that prevent the Investors from selling securities pursuant

to the registration statement, the Company has agreed to make pro rata payments to each holder as liquidated damages in an amount equal

to 1.0 % of the aggregate amount paid pursuant to the Securities Purchase Agreement by such Investor for each 30-day period or pro rata

for any portion thereof for each such month during which such event continues, provided that the maximum aggregate amounts payable as

liquidated damages shall not exceed 6.0 % of the aggregate amount invested by each such holder in the Registrable Securities then held

by the holder.

October 13, 2023, one of the Company’s preferred shareholders elected to convert 181,739 shares of Series A Convertible Preferred

Stock into 1,817,390 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.

Subsequent Event

Subsequent to March 31, 2024, pursuant

to an Open Market Sale Agreement SM with Jefferies LLC, as agent, the Company sold 435,414 shares of common stock at an average

selling price of $ 17.55 per share, generating gross proceeds of $ 7.6 million before deducting commissions and other offering expenses

of $ 0.2 million.

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