What changed in this filing

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Item 1. Financial Statements

2021-11-04 compared with 2021-08-05 · 93 added, 76 removed, 400 unchanged (30% of the section changed)

3 unchanged sentences

(in thousands, except par value)

September 30,

2021 December 31,

24 unchanged sentences

Common stock, $ 0.0001 par value, 150,000 shares authorized;

39,552 and 36,781 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively

39,552 and 36,781 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively

Additional paid-in capital 384,551 361,819

Service receivables ( 666 ) ( 2,171 )

Accumulated other comprehensive loss ( 10 ) —

Accumulated other comprehensive income 16 —

Accumulated deficit ( 250,362 ) ( 231,495 )

5 unchanged sentences

(in thousands, except per share amounts)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

20 unchanged sentences

(in thousands)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

Net loss $ ( 6,913 ) $ ( 4,497 ) $ ( 18,849 ) $ ( 12,710 )

Other comprehensive loss:

Unrealized gain (loss) on securities available-for-sale 57 — ( 10 ) —

Other comprehensive income:

Unrealized gain on securities available-for-sale 26 — 16 —

Total comprehensive loss ( 6,887 ) ( 4,497 ) ( 18,833 ) ( 12,710 )

12 unchanged sentences

Amount Additional

Paid-In Capital Service Receivable Accumulated Other Comprehensive Loss Accumulated Deficit Total

Paid-In Capital Service Receivable Accumulated Other Comprehensive Income/(Loss) Accumulated Deficit Total

Stockholders’ Equity

15 unchanged sentences

Balance, June 30, 2021 716 $ 1 39,552 $ 4 $ 383,611 $ ( 1,245 ) $ ( 10 ) $ ( 243,443 ) $ 138,918

Stock-based compensation — — — — 940 — — — 940

Other comprehensive gain — — — — — — 26 — 26

Preferred stock dividend — — — — — — — ( 6 ) ( 6 )

Release of clinical trial funding commitment — — — — — 579 — — 579

Net loss — — — — — — — ( 6,913 ) ( 6,913 )

Balance, September 30, 2021 716 $ 1 39,552 $ 4 $ 384,551 $ ( 666 ) $ 16 $ ( 250,362 ) $ 133,544

(1) Net of expenses of $ 0.8 million.

5 unchanged sentences

Amount Additional

Paid-In Capital Service Receivable Accumulated Other Comprehensive Loss Accumulated Deficit Total

Paid-In Capital Service Receivable Accumulated Other Comprehensive Income/(Loss) Accumulated Deficit Total

Stockholders’ Equity

21 unchanged sentences

Balance, June 30, 2020 927 $ 1 21,325 $ 9 $ 247,528 $ ( 2,766 ) $ — $ ( 220,390 ) $ 24,382

Stock-based compensation — — — — 362 — — — 362

Issuance of common stock upon exercise of warrants — — 4,957 1 12,910 — — — 12,911

Issuance of common stock upon exercise of stock options — — 3 — 7 — — — 7

Issuance of common stock upon vesting of restricted stock units — — 1 — — — — — —

Preferred stock dividend payable on Series A Convertible Preferred Stock — — — — — — — ( 6 ) ( 6 )

Preferred Stock

Shares Preferred Stock

Amount Common Stock

Shares Common Stock

Amount Additional

Paid-In Capital Service Receivable Accumulated Other Comprehensive Income/(Loss) Accumulated Deficit Total

Stockholders’ Equity

Release of clinical trial funding commitment — — — — — 362 — — 362

Net loss — — — — — — — ( 4,497 ) ( 4,497 )

Balance, September 30, 2020 927 $ 1 26,286 $ 10 $ 260,807 $ ( 2,404 ) $ — $ ( 224,893 ) $ 33,521

(2) Net of expenses of $ 0.6 million, and fair value of warrants issued as a transaction advisory fee as of the date of issuance of $ 0.4 million.

3 unchanged sentences

(in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Operating activities

18 unchanged sentences

Investing activities:

Capital expenditures ( 98 ) ( 154 )

Maturities of short-term investments 15,101 —

6 unchanged sentences

Costs related to the clinical trial funding commitment — ( 8 )

Proceeds from exercise of options — 7

Proceeds from exercise of warrants 1,263 18,972

7 unchanged sentences

Supplemental disclosure of non-cash investing and financing activities:

Acquisition of property and equipment included in accounts payable and accrued expenses $ 27 $ 11

Six Months Ended June 30,

Expenses from sales of common stock, preferred stock and warrants included in accounts payable and accrued liabilities $ — $ 523

Expenses from exercise of warrants included in accounts payable and accrued liabilities $ — $ 64

Nine Months Ended September 30,

Preferred stock dividend payable on Series A Convertible Preferred Stock $ 18 $ 18

8 unchanged sentences

Cardiff Oncology, Inc.

(“Cardiff Oncology” or the “Company”) headquartered in San Diego, California, is a clinical-stage oncology company with the mission of developing new precision medicine treatment options for cancer patients in indications with the greatest unmet medical need, including KRAS-mutated metastatic colorectal cancer, metastatic pancreatic cancer and Zytiga®-resistant metastatic castration-resistant prostate cancer.

The Company's common stock is listed on the Nasdaq Capital Market under the ticker symbol "CRDF".

7 unchanged sentences

The Company has incurred net losses since its inception and has negative operating cash flows.

As of June 30, 2021, the Company had $ 140.1 million in cash, cash equivalents and short-term investments and believes it has sufficient cash to meet its funding requirements for at least the next 12 months following the issuance date of these financial statements.

As of September 30, 2021, the Company had $ 134.0 million in cash, cash equivalents and short-term investments and believes it has sufficient cash to meet its funding requirements for at least the next 12 months following the issuance date of these financial statements.

For the foreseeable future, the Company expects to continue to incur losses and require additional capital to further advance its clinical trial programs and support its other operations.

4 unchanged sentences

Summary of Significant Accounting Policies

During the six months ended June 30, 2021, there have been no changes to the Company’s significant accounting policies as described in its Annual Report on Form 10-K for the fiscal year ended December 31, 2020, other than the addition of investment securities as described below.

During the nine months ended September 30, 2021, there have been no changes to the Company’s significant accounting policies as described in its Annual Report on Form 10-K for the fiscal year ended December 31, 2020, other than the addition of investment securities as described below.

Investment Securities

10 unchanged sentences

Preferred dividends are included in net loss attributable to common stockholders in the computation of basic and diluted earnings per share.

The following table sets forth the computation of basic and diluted earnings per share:

Ended June 30, Six Months

Ended June 30,

(in thousands, except per share amounts) 2021 2020 2021 2020

Net loss used for basic and diluted loss per share $ ( 6,763 ) $ ( 7,397 ) $ ( 11,948 ) $ ( 11,492 )

Weighted-average shares used to compute basic and diluted net loss per share 38,761 14,492 37,967 12,201

Net loss per share attributable to common stockholders:

Basic and diluted $ ( 0.17 ) $ ( 0.51 ) $ ( 0.31 ) $ ( 0.94 )

The following table sets forth the outstanding potentially dilutive securities that have been excluded in the calculation of diluted net loss per share because their effect was anti-dilutive:

September 30,

Options to purchase Common Stock 3,566,832 1,920,706

12 unchanged sentences

The amendment is to be adopted through either a fully retrospective or modified retrospective method of transition.

adoption is permitted.

Early adoption is permitted.

The Company is currently evaluating the impact of this standard on its financial statements and related disclosures.

5 unchanged sentences

Fair Value Measurements

The following table presents the Company’s assets and liabilities that are measured and recognized at fair value on a recurring basis classified under the appropriate level of the fair value hierarchy as of June 30, 2021 and December 31, 2020:

Fair Value Measurements at

June 30, 2021

September 30, 2021

(in thousands) Quoted Prices in Active Markets for Identical Assets and Liabilities

30 unchanged sentences

(3) A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs or instruments that trade infrequently and therefore have little or no price transparency are classified as Level 3.

At each reporting period, all assets and liabilities for which the fair value

measurement is based on significant unobservable inputs or instruments that trade infrequently and therefore have little or no price transparency are classified as Level 3.

See Note 6 to the condensed financial statements for further information.

1 unchanged sentence

Investments available for sale consist of the following:

As of June 30,

As of September 30,

(in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Market Value

6 unchanged sentences

Property and equipment consist of the following:

(in thousands) As of June 30,

(in thousands) As of September 30,

2021 As of December 31,

8 unchanged sentences

Master Facility Lease

The Company leases a building in San Diego under an operating lease that expires on December 31, 2021.

The lease currently requires fixed monthly rent payments of approximately $ 80,000 , with 3 % annual escalation.

During July 2021, the Company entered into an amended lease agreement to continue leasing 12,300 square feet of the 26,100 square feet from the lease that expires at year end.

See Note 11 to the condensed financial statements for further information regarding the amended lease agreement.

The Company currently occupies 9,500 square feet of office and lab space in San Diego.

During July 2021, the Company entered into an amended lease agreement to increase its occupied space to 12,300 square feet which commences on January 1, 2022 and expires on February 28, 2027.

Under the current master facility lease, which expires on December 31, 2021, the Company leases 26,100 square feet of office and lab space.

This includes 16,600 square feet of space that is subleased to third parties, all of which expires on December 31, 2021.

The minimum monthly rent under the amended lease is $ 55,000 with an annual rent escalation of 3 % per year beginning on January 1, 2022.

Through December 31, 2021 rent payments are approximately $ 80,000 per month.

Facility Subleases

As a result of corporate restructurings in previous years, the Company vacated a portion of its facility and has subleased the space to third parties under three separate sublease agreements, which all expire December 31, 2021.

The Company as a sublessor is leasing approximately 16,600 square feet of space to third parties as of September 30, 2021.

The components of lease expense were as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands) 2021 2020 2021 2020

3 unchanged sentences

Supplemental balance sheet information related to leases was as follows:

(in thousands) As of June 30,

(in thousands) As of September 30,

2021 As of December 31,

6 unchanged sentences

Supplemental cash flow and other information related to leases was as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands) 2021 2020 2021 2020

1 unchanged sentence

Operating cash flows from operating leases $ 243 $ 237 $ 726 $ 706

ROU assets obtained in exchange for lease liabilities:

Operating leases $ 3,061 $ — $ 3,061 $ —

Total remaining annual commitments under non-cancelable lease agreements for each of the years ended December 31 are as follows:

1 unchanged sentence

Year Ending December 31, Operating Leases Sublease Income Net Operating Leases

2021 (excluding the six months ended June 30, 2021) $ 406 $ ( 202 ) $ 204

2021 (excluding the nine months ended September 31, 2021) $ 163 $ ( 101 ) $ 62

2022 610 — 610

2023 737 — 737

2024 754 — 754

2025 775 — 775

Thereafter 933 — 933

Total future minimum lease payments 3,972 $ ( 101 ) $ 3,871

Less imputed interest ( 687 )

Total $ 3,285

Derivative Financial Instruments — Warrants

3 unchanged sentences

The assumptions used to determine the fair value of the warrants using the Black-Scholes option pricing model were:

As of June 30,

As of September 30,

2021 As of December 31,

13 unchanged sentences

Change in fair value of derivative financial instruments — warrants during the period recognized as a gain in the condensed statements of operations

June 30, 2021 Balance of derivative financial instruments — warrants liability

September 30, 2021 Balance of derivative financial instruments — warrants liability

Stockholders’ Equity

1 unchanged sentence

Stock-based compensation expense related to Cardiff Oncology equity awards have been recognized in operating results as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands) 2021 2020 2021 2020

2 unchanged sentences

Total stock-based compensation expense $ 940 $ 362 $ 2,244 $ 821

The unrecognized compensation cost related to non-vested stock options outstanding at June 30, 2021, net of estimated forfeitures, was $ 7.9 million, which is expected to be recognized over a weighted-average remaining vesting period of 3.3 years.

The weighted-average remaining contractual term of outstanding options as of June 30, 2021 was approximately 8.9 years.

The total fair value of stock options vested during the six months ended June 30, 2021 and 2020 were $ 1.2 million and $ 0.8 million, respectively.

The unrecognized compensation cost related to non-vested stock options outstanding at September 30, 2021, net of estimated forfeitures, was $ 10.1 million, which is expected to be recognized over a weighted-average remaining vesting period of 3.3 years.

The weighted-average remaining contractual term of outstanding options as of September 30, 2021 was

approximately 8.9 years.

The total fair value of stock options vested during the nine months ended September 30, 2021 and 2020 were $ 1.2 million and $ 0.8 million, respectively.

The estimated fair value of stock option awards was determined on the date of grant using the Black-Scholes option valuation model with the following weighted-average assumptions during the following periods indicated:

Six Months Ended June 30,

Nine Months Ended September 30,

Risk-free interest rate 0.95 % 0.44 %

9 unchanged sentences

Canceled / Forfeited ( 10,770 ) $ 2.55

Balance outstanding, June 30, 2021 2,966,843 $ 7.65 $ 7,439,918

Exercisable at June 30, 2021 1,282,401 $ 9.65 $ 5,076,084

Vested and expected to vest at June 30, 2021 2,886,407 $ 7.72 $ 7,262,361

Expired ( 4,219 ) $ 216.00

Balance outstanding, September 30, 2021 3,566,832 $ 7.22 $ 7,522,769

Exercisable at September 30, 2021 1,281,604 $ 8.96 $ 5,103,890

Vested and expected to vest at September 30, 2021 3,466,323 $ 7.28 $ 7,344,075

2021 Equity Incentive Plan

2 unchanged sentences

and (iii) the number of shares of Common Stock underlying forfeited awards under the 2014 Plan.

As of June 30, 2021, there were 2,304,110 shares available for issuance under the 2021 Plan.

As of September 30, 2021, there were 2,289,902 shares available for issuance under the 2021 Plan.

2014 Equity Incentive Plan

Subsequent to the adoption of the 2021 Plan, no additional equity awards can be made under the terms of the 2014 Plan.

Inducement Grants

In July 2021, the Company began issuing equity awards to certain new employees as inducement grants outside of its 2021 Plan.

As of September 30, 2021, an aggregate of 590,000 shares were issuable upon the exercise of inducement grant stock options approved by the Company.

Modification of Stock Options

In June 2021 two of the Company's directors left the Board of Directors.

At the time of departure, the Compensation Committee passed a resolution to extend the expiration date of both of the departing directors vested stock options, and to immediately accelerate the vesting of one of the directors unvested options.

The Company recorded incremental stock compensation expense of $ 0.6 million during the three months ended June 30, 2021 related to the modifications.

In June 2021 two of the Company's directors' terms ended.

At the conclusion of their term, the Compensation Committee passed a resolution to extend the expiration date of the departing directors vested stock options, and to immediately accelerate the vesting of one of the directors unvested options.

The Company recorded incremental stock compensation expenses of$ 0.6 million during the nine months ended September 30, 2021, related to the modifications.

Restricted Stock Units

5 unchanged sentences

Vested ( 491 ) $ 147.60

Non-vested RSUs outstanding, June 30, 2021 — $ — $ —

The total fair value of vested RSUs during the six months ended June 30, 2021 and 2020 were $ 72 thousand and $ 99 thousand, respectively.

Non-vested RSUs outstanding, September 30, 2021 — $ — $ —

The total fair value of vested RSUs during the nine months ended September 30, 2021 and 2020 were $ 0.1 million and $ 0.1 million, respectively.

A summary of warrant activity and changes in warrants outstanding, including both liability and equity classifications is presented below:

5 unchanged sentences

Exercised ( 770,833 ) $ 1.64

Balance outstanding, June 30, 2021 4,490,159 $ 5.80 3.5 years

Balance outstanding, September 30, 2021 4,490,159 $ 5.80 3.2 years

Preferred Stock

1 unchanged sentence

Shares outstanding

Class Par value Shares designated Liquidation preference As of June 30,

Class Par value Shares designated Liquidation preference As of September 30,

2021 As of December 31,

4 unchanged sentences

Series E Convertible Preferred Stock $ 0.001 865,824 None 655,044 655,044

Sale of Common Stock

During May 2021, the Company sold 2.0 million shares of its common stock under the Sales Agreement with Jefferies LLC.

Commitments and Contingencies

11 unchanged sentences

These royalty payments are calculated as a percent of revenue.

For the three and six months ended June 30, 2021 and 2020, payments have not been material.

For the three and nine months ended September 30, 2021 and 2020, payments have not been material.

Cardiff Oncology does not believe that it has legal liabilities that are probable or reasonably possible that require either accrual or disclosure.

13 unchanged sentences

In connection with the MTA, the Company entered into a consulting agreement with Tommy Adams, Co-Founder & Chief Operating Officer of Leucadia, who is the son of Dr.

During the three months ended June 30, 2021 and 2020 the Company incurred and recorded research and development expenses of approximately $ 0 and $ 0.3 million, respectively, for services performed by Leucadia and Tommy Adams.

During the six months ended June 30, 2021 and 2020 the Company incurred and recorded research and development expenses of approximately $ 0 and $ 0.5 million, respectively, for services performed by Leucadia and Tommy Adams.

During the three months ended September 30, 2021 and 2020 the Company incurred and recorded research and development expenses of approximately $ 0 and $ 0.3 million, respectively, for services performed by Leucadia and Tommy Adams.

During the nine months ended September 30, 2021 and 2020 the Company incurred and recorded research and development expenses of approximately $ 0 and $ 0.8 million, respectively, for services performed by Leucadia and Tommy Adams.

The COVID-19 outbreak in the United States has caused significant business disruption.

The extent of the impact of COVID-19 on the Company's future operational and financial performance will depend on certain developments, including the duration and spread of the outbreak, and impact on the Company's clinical trials, employees and vendors, all of which are uncertain and cannot be predicted.

At this point, the extent to which COVID-19 may impact the Company's future financial condition or results of operations is uncertain.

While there has not been a material impact on the Company's condensed financial statements for the six months ended June 30, 2021, a prolonged outbreak could have a material adverse impact on financial results and business operations of the Company, including the timing and ability of the Company to complete certain clinical trials and other efforts required to advance the development of its drugs and raise additional capital.

In response to the pandemic, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was signed into law on March 27, 2020.

The CARES Act, among other things, includes tax provisions relating to refundable payroll tax credits, deferment of employer’s social security payments, net operating loss utilization and carryback periods, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property.

The Company is utilizing the deferment of employer social security payments.

The CARES Act did not have a material impact on our income tax provision for the six months ended June 30, 2021.

We continue to monitor changes and revisions of the CARES Act and its impact on our financial position, results of operations and cash flows.

Subsequent Events

Amendment to facility lease agreement

During July 2021, the Company entered into an amended lease agreement ("amended lease") with BMR-COAST 9 LP.

The amended agreement commences on January 1, 2022 and expires on February 28, 2027.

The Company will lease approximately 12,300 square feet of office and lab space.

The minimum monthly rent under the amended lease is $ 55 thousand with an annual rent escalation of 3 % per year.

Thus far COVID-19 has not caused material disruptions to the Company's operational and financial performance.

A prolonged outbreak could have a material adverse impact on financial results and business operations of the Company, including the timing and ability of the Company to complete certain clinical trials and other efforts required to advance the development of its drugs and raise additional capital.

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