What changed in this filing

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Item 1. Financial Statements

2024-08-08 compared with 2024-05-02 · 83 added, 42 removed, 298 unchanged (30% of the section changed)

26 unchanged sentences

277 designated as Series A Convertible Preferred Stock;

60,600 shares outstanding at March 31, 2024 and December 31, 2023 with liquidation preference of $ 1,074 and $ 1,068 at March 31, 2024 and December 31, 2023, respectively (Note 5)

61 shares outstanding at June 30, 2024 and December 31, 2023 with liquidation preference of $ 1,080 and $ 1,068 at June 30, 2024 and December 31, 2023, respectively

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

44,710 and 44,677 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively

45,602 and 44,677 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively

Additional paid-in capital 413,017 409,343

7 unchanged sentences

(in thousands, except per share amounts)

Three Months Ended March 31,

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

2024 2023 2024 2023

Royalty revenues $ 163 $ 108 $ 368 $ 191

17 unchanged sentences

(in thousands)

Three Months Ended March 31,

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

2024 2023 2024 2023

Net loss $ ( 11,778 ) $ ( 11,150 ) $ ( 21,789 ) $ ( 22,373 )

26 unchanged sentences

61 — 44,710 4 409,781 ( 132 ) ( 348,759 ) 60,894

Issuance of common stock, net of expenses (2)

— — 792 1 1,804 — — 1,805

Stock-based compensation — — — — 1,179 — — 1,179

Issuance of common stock upon exercise of stock options — — 100 — 253 — — 253

Other comprehensive gain

— — — — — 35 — 35

Net loss — — — — — — ( 11,778 ) ( 11,778 )

Balance, June 30, 2024

61 $ — 45,602 $ 5 $ 413,017 $ ( 97 ) $ ( 360,537 ) $ 52,388

(1) See Note 2.

(2) Net of expenses of $ 197,000 .

Preferred Stock

11 unchanged sentences

Balance, March 31, 2023 61 — 44,677 4 405,898 ( 76 ) ( 309,323 ) 96,503

Stock-based compensation — — — — 1,581 — — 1,581

Other comprehensive loss — — — — — ( 355 ) — ( 355 )

Net loss — — — — — — ( 11,150 ) ( 11,150 )

Balance, June 30, 2023 61 $ — 44,677 $ 4 $ 407,479 $ ( 431 ) $ ( 320,473 ) $ 86,579

See accompanying notes to the unaudited condensed financial statements.

2 unchanged sentences

(in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Operating activities

6 unchanged sentences

Changes in operating assets and liabilities:

Other assets 4 26

Accounts receivable and unbilled receivable ( 163 ) 610

1 unchanged sentence

Operating lease right-of-use assets 269 273

Other assets 8 ( 3 )

Accounts payable and accrued liabilities

8 unchanged sentences

Financing activities:

Proceeds from sales of common stock, net of expenses of $ 197 and $ 0 , respectively

Proceeds from exercise of options 360 —

13 unchanged sentences

(“Cardiff Oncology” or the “Company”) headquartered in San Diego, California, is a clinical-stage biotechnology company leveraging Polo-like Kinase 1 (“PLK1”) inhibition, to develop novel therapies across a range of cancers.

The Company’s lead asset is onvansertib, a PLK1 inhibitor that is being evaluated in combination with standard of care ("SoC") therapeutics in clinical programs targeting indications such as RAS-mutated metastatic colorectal cancer (“mCRC”), as well as investigator-initiated trials in metastatic pancreatic ductal adenocarcinoma (“mPDAC”), small cell lung cancer (“SCLC”), and triple negative breast cancer (“TNBC”).

These programs and the Company’s broader development strategy are designed to target tumor vulnerabilities in order to overcome treatment resistance and deliver superior clinical benefit compared to the SoC alone.

The Company’s lead asset is onvansertib, a PLK1 inhibitor that is being evaluated in combination with standard-of- care ("SoC") therapeutics in clinical programs targeting indications such as RAS-mutated metastatic colorectal cancer (“mCRC”), as well as ongoing or planned investigator-initiated trials in metastatic pancreatic ductal adenocarcinoma (“mPDAC”), small cell lung cancer (“SCLC”), and triple negative breast cancer (“TNBC”).

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 March 31, 2024, the Company had $ 67.2 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 June 30, 2024, the Company had $ 60.3 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.

2 unchanged sentences

Summary of Significant Accounting Policies

During the three months ended March 31, 2024, 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, 2023.

During the six months ended June 30, 2024, 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, 2023.

Net Loss Per Share

12 unchanged sentences

In addition, ASU 2020-06 modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation.

The amendments in this update are effective for the Company on January 1, 2024.

This update was effective for the Company on January 1, 2024.

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

3 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 March 31, 2024, and December 31, 2023:

Fair Value Measurements at

March 31, 2024

June 30, 2024

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

28 unchanged sentences

The Company’s policy is to recognize transfers between levels of the fair value hierarchy on the date of the event or change in circumstances that caused the transfer.

There were no transfers into or out of Level 3 during the three months ended March 31, 2024 .

There were no transfers into or out of Level 3 during the six months ended June 30, 2024 .

Supplementary Balance Sheet Information

Investments available for sale

Investments available for sale consist of the following:

As of March 31, 2024

Investments available for sale consisted of the following:

As of June 30, 2024

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

16 unchanged sentences

Commercial paper 6,193 9 — 6,202

government 835 — ( 1 ) 834

government agencies 835 — ( 1 ) 834

treasury securities — — — —

Total maturity less than 1 year 26,293 33 ( 17 ) 26,309

6 unchanged sentences

For debt securities where the fair value of the investment is less than the amortized cost basis, we have assessed at the individual security level for various quantitative factors including, but not limited to, the nature of the investments, changes in credit ratings, interest rate fluctuations, industry analyst reports, and the severity of impairment.

Unrealized losses in investments available for sale debt securities at March 31, 2024, were substantially due to increases in interest rates, not due to increased credit risks associated with specific securities.

Unrealized losses in investments available for sale debt securities at June 30, 2024, were substantially due to increases in interest rates, not due to increased credit risks associated with specific securities.

Accordingly, we have not recorded an allowance for credit losses.

It is not more likely than not that we will be required to sell the investments before recovery of their amortized cost bases, which may be at maturity.

Investments available for sale that have been in a continuous unrealized loss position for greater than one-year consist of the following:

As of March 31, 2024

Investments available for sale that have been in a continuous unrealized loss position for greater than one-year consisted of the following:

As of June 30, 2024

(in thousands) Fair Market Value Gross Unrealized Loss

Corporate debt securities $ 4,333 $ ( 19 )

treasury securities 9,794 ( 72 )

Total $ 14,127 $ ( 91 )

As of December 31, 2023

2 unchanged sentences

Property and equipment

Property and equipment consist of the following:

(in thousands) As of March 31,

Property and equipment consisted of the following:

(in thousands) As of June 30,

2024 As of December 31,

2 unchanged sentences

Laboratory equipment 1,414 1,355

Property and equipment, gross

Less—accumulated depreciation and amortization ( 3,954 ) ( 3,752 )

2 unchanged sentences

Accrued liabilities consisted of the following:

(in thousands) As of March 31,

(in thousands) As of June 30,

2024 As of December 31,

Accrued compensation $ 1,234 $ 2,737

Clinical trials $ 3,832 $ 4,309

Accrued compensation 1,790 2,737

Research agreements and services 867 530

4 unchanged sentences

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

Three Months Ended March 31,

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

(in thousands) 2024 2023 2024 2023

2 unchanged sentences

Total stock-based compensation expense $ 1,179 $ 1,581 $ 2,303 $ 2,645

The unrecognized compensation cost related to non-vested stock options outstanding at March 31, 2024, net of estimated forfeitures, was $ 10.2 million, which is expected to be recognized over a weighted-average remaining vesting period of 2.1 years.

The weighted-average remaining contractual term of outstanding options as of March 31, 2024, was approximately

The total fair value of stock options vested during the three months ended March 31, 2024 and 2023, were $ 1.4 million and $ 1.9 million, respectively.

The unrecognized compensation cost related to non-vested stock options outstanding at June 30, 2024, net of estimated forfeitures, was $ 9.4 million, which is expected to be recognized over a weighted-average remaining vesting period of 2.5 years.

The weighted-average remaining contractual term of outstanding options as of June 30, 2024, was approximately 8.0 years.

The total fair value of stock options vested during the six months ended June 30, 2024 and 2023, were $ 2.7 million and $ 3.2 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:

Three Months Ended March 31,

Six Months Ended June 30,

Risk-free interest rate 4.06 % 3.61 %

11 unchanged sentences

Forfeited and expired ( 65,314 ) $ 13.96

Balance outstanding, March 31, 2024 8,297,292 $ 4.09 $ 17,780,158

Exercisable at March 31, 2024 3,735,195 $ 5.10 $ 7,103,808

Vested and expected to vest at March 31, 2024 8,050,310 $ 4.13 $ 17,126,855

Balance outstanding, June 30, 2024 8,351,122 $ 4.02 $ 1,169,885

Exercisable at June 30, 2024 4,124,114 $ 4.85 $ 468,750

Vested and expected to vest at June 30, 2024 8,121,830 $ 4.05 $ 1,118,569

2021 Equity Incentive Plan

In June 2021 the Company's stockholders approved the 2021 Omnibus Equity Incentive Plan ("2021 Plan").

The number of authorized shares in the 2021 Plan is equal to the sum of (i) 3,150,000 shares, plus (ii) the number of shares of Common Stock reserved, but unissued under the 2014 Plan;

As of June 30, 2024 the number of authorized shares in the 2021 Plan is equal to the sum of (i) 8,150,000 shares, plus (ii) the number of shares of Common Stock reserved, but unissued under the 2014 Plan;

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

On June 9, 2022, the shareholders approved an increase of shares authorized in the 2021 Plan to 5,150,000 from 3,150,000 .

As of March 31, 2024, there were 307,279 shares available for issuance under the 2021 Plan.

As of June 30, 2024, there were 3,153,005 shares available for issuance under the 2021 Plan.

2014 Equity Incentive Plan

2 unchanged sentences

The Company issues equity awards to certain new employees as inducement grants outside of its 2021 Plan.

As of March 31, 2024, an aggregate of 1,380,248 shares were issuable upon the exercise of inducement grant stock options approved by the Company.

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

As of June 30, 2024, an aggregate of 1,380,248 shares were issuable upon the exercise of inducement grant stock options approved by the Company.

Rescinding and reissuance of March 2024 stock options

On May 30, 2024, the Board of Directors of the Company approved the rescinding of an aggregate of 1,697,712 shares of common stock issuable upon exercise of stock options granted on March 7, 2024 at an exercise price of $ 3.51 per share to employees and officers of the Company.

On May 30, 2024, the Board of Directors of the Company approved the grant of an aggregate of 1,697,712 shares of common stock issuable upon exercise of stock options at an exercise price of $ 3.51 per share to employees and officers of the Company, subject to stockholder approval of an increase in the shares of common stock

available for issuance pursuant to the Company’s 2021 Equity Incentive Plan at the Company’s annual meeting on June 20, 2024.

The increase of shares available was approved by shareholders at the June 20, 2024 meeting, thus completing the requirements for the reissuance of the grant.

The terms of the reissued grant were identical to the rescinded grant, therefore the transaction does not represent a stock option modification.

A summary of warrant activity and changes in warrants outstanding, classified as equity is presented below:

Total Warrants Weighted-Average

3 unchanged sentences

Balance outstanding, December 31, 2023 2,807,948 $ 2.45 1.9 years

Balance outstanding, March 31, 2024 2,807,948 $ 2.45 1.7 years

Expired ( 595 ) $ 252.72

Balance outstanding, June 30, 2024 2,807,353 $ 2.40 1.4 years

Sale of Common Stock

During June 2024, the Company received net proceeds of $ 1.8 million from the sale of 0.8 million shares of its common stock under the Sales Agreement with Jefferies LLC.

Commitments and Contingencies

7 unchanged sentences

and (b) upon filing of the first NDA or equivalent for the first product candidate.

During the three months ended March 31, 2024 and 2023 no milestone or royalty payments were made.

During the six months ended June 30, 2024 and 2023 no milestone or royalty payments were made.

The Company is a party to various agreements under which it licenses technology on an exclusive basis in the field of oncology therapeutics.

These agreements include License fees, Royalties and Milestone payments.

The Company also has a legacy license agreement in the field of oncology diagnostics under which royalty payments are due.

The Company also has a legacy license agreement in the field of oncology diagnostics under which royalty payments are due to the Company.

These royalty payments are calculated as a percent of revenue.

For the three months ended March 31, 2024 and 2023, 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.

For the six months ended June 30, 2024 and 2023, payments have not been material.

As previously disclosed in the Supplement to the Company’s Proxy Statement for its Annual Meeting held on June 20, 2024 (the “2024 Annual Meeting”) as filed with the SEC on June 3, 2024, a purported stockholder of the Company filed a class action and derivative complaint in the Court of Chancery of the State of Delaware against the Company, and against James Armitage, Mark Erlander, Rodney Markin, Mani Mohindru, Gary Pace, Renee Tannenbaum, Lale White, Tod Smeal, Fairooz Kabbinavar and James Levine.

The complaint alleges, among other things, that the By-Laws of the Company (the “By-Laws”), in effect as of May 13, 2024, require directors to be elected, and other business to be transacted, using a voting standard that treats broker non-votes as votes “against” these actions.

This purported stockholder also claims that directors Renee Tannenbaum and Mani Mohindru were not validly elected in 2022 and 2023, respectively, and that the Company did not validly amend its 2021 Equity Incentive Plan at the annual meeting of stockholders held in 2022, in each case because the voting standard urged by the purported stockholder was not satisfied.

The Board of Directors adopted amendments to the By-Laws to confirm and clarify the applicable voting standards that applied to the business transacted at the 2024 Annual Meeting.

The Board of Directors also adopted resolutions to rescind equity grants that were made in reliance on the 2022 amendment to the 2021 Equity Incentive Plan and approved replacement grants with terms identical to the equity grants rescinded.

The replacement grants were approved by the stockholders at the 2024 Annual Meeting.

On June 26, 2024, the plaintiff dismissed the complaint with prejudice as to the plaintiff, with the court retaining jurisdiction to determine plaintiff’s counsel’s application for an award of attorneys’ fees.

Currently, the fees cannot be estimated, and no fees have been accrued.

The Company does not believe these fees will be material.

From time to time, the Company may become involved in various lawsuits and legal proceedings that arise in the ordinary course of business.

1 unchanged sentence

As of the date of this report, management believes that there are no claims against the Company, which could result in a material adverse effect on the Company’s business or financial condition.

Subsequent Events

Sale of Common Stock

From July 1, 2024 through August 6, 2024, the Company sold 0.9 million shares of its common stock under the Sales Agreement with Jefferies LLC.

Gross proceeds from these sales was $ 2.3 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