What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2021-11-15 compared with 2021-05-13 · 172 added, 291 removed, 348 unchanged (57% of the section changed)

2 unchanged sentences

Condensed Consolidated Interim Financial Statements

For the nine months ended March 31, 2021

For the three months ended September 30, 2021

(expressed in US dollars unless otherwise noted)

Kintara Therapeutics, Inc.

Condensed Consolidated Interim Balance Sheet

Condensed Consolidated Interim Balance Sheets

(In thousands, except par value amounts)

September 30,

Current assets

Cash and cash equivalents

Prepaid expenses and deposits

Prepaid expenses, deposits and other

Clinical trial deposit

Interest, taxes and other receivables

Deferred loan costs

Clinical trial deposit

Intangible assets - net

Property and equipment - net

Deferred financing costs

Property, equipment and intangibles, net

Current liabilities

Accounts payable and accrued liabilities

Loan payable, net of deferred loan costs

Related party payables

5 unchanged sentences

Issued and outstanding

279 Series A shares at March 31, 2021

(June 30, 2020 – 279 )

601 Series B shares at March 31, 2021

279 Series A shares at September 30, 2021

(June 30, 2021 – 279 )

21 Series C shares at March 31, 2021

18 Series C shares at September 30, 2021

(June 30, 2021 – 2 0 )

95,000 shares at March 31, 2021 and June 30, 2020,

175,000 shares at September 30, 2021 and June 30, 2021,

$ 0.001 par value

31,764 issued at March 31, 2021 (June 30, 2020 –

47,974 issued at September 30, 2021 (June 30, 2021 –

Additional paid-in capital

11 unchanged sentences

Three months ended

Nine months ended

September 30,

Research and development

4 unchanged sentences

Amortization of deferred loan costs

Interest expense

Interest income

Interest, net

Net loss for the period

4 unchanged sentences

Series B Preferred stock dividend

Series C Preferred stock dividend

Net loss for the period attributable to common stockholders

4 unchanged sentences

Condensed Consolidated Interim Statements of Stockholders’ Equity

For the three and nine months ended March 31, 2021

For the three months ended September 30, 2021

(In thousands)

2 unchanged sentences

Balance - June 30, 2021

Adgero merger (note 3)

Issuance of Series C Preferred stock

Series C placement agent warrants

Series C Preferred stock share issuance costs

Deemed dividend recognized on beneficial

conversion features of Series C Preferred stock

Exercise of warrants

Warrants issued for services

Stock option expense

Series A Preferred cash dividend

Series B Preferred stock dividend

Loss for the period

Balance - September 30, 2020

Series C Preferred stock share issuance costs

Conversion of Series B Preferred stock

to common stock

Conversion of Series C Preferred stock

to common stock

Exercise of warrants

Warrants issued for services

Stock options exercised

Stock option expense

Series A Preferred cash dividend

Series B Preferred stock dividend

Loss for the period

Balance - December 31, 2020

Conversion of Series B Preferred stock

to common stock

Issuance of shares and warrants - net of issue costs

Conversion of Series C Preferred stock

to common stock

Series C Agent Warrants exercised

Exercise of warrants

Exercise of 2020 Investor Warrants for cash

Exercise of pre-funded warrants for cash

Warrants issued for services

Stock options exercised

Stock option expense

Series A Preferred cash dividend

Series B Preferred stock dividend

Series C Preferred stock dividend

Loss for the period

Balance - March 31, 2021

Balance - September 30, 2021

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

1 unchanged sentence

Condensed Consolidated Interim Statements of Stockholders’ Equity

For the three and nine months ended March 31, 2020

For the three months ended September 30, 2020

(In thousands)

2 unchanged sentences

Balance - June 30, 2020

Issuance of shares and warrants - net of

Exercise of pre-funded warrants for cash

Conversion of Series B Preferred stock

to common stock

Shares issued for services

Stock option expense

Series A Preferred cash dividend

Series B Preferred stock dividend

Loss for the period

Balance - September 30, 2019

Warrants issued for services

Shares issued for services

Stock option expense

Series A Preferred cash dividend

Series B Preferred stock dividend

Loss for the period

Balance - December 31, 2019

Adgero merger (note 3)

Issuance of Series C Preferred stock

Series C placement agent warrants

Series C Preferred stock share issuance costs

Deemed dividend recognized on beneficial

conversion features of Series C Preferred stock

Exercise of warrants

Warrants issued for services

Shares issued for services

Stock option expense

2 unchanged sentences

Loss for the period

Balance - March 31, 2020

Balance - September 30, 2020

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

2 unchanged sentences

(In thousands)

Nine months ended

Three months ended

September 30,

Cash flows from operating activities

7 unchanged sentences

Amortization of deferred loan costs

Shares issued for services

Warrants issued for services

1 unchanged sentence

Changes in operating assets and liabilities

Prepaid expenses and deposits

Interest, taxes and other receivables

Prepaid expenses, deposits and other

Accounts payable and accrued liabilities

3 unchanged sentences

Cash acquired on merger with Adgero

Purchase of equipment

Proceeds on sale of equipment

Net cash provided by investing activities

2 unchanged sentences

Warrants exercised for cash

Stock options exercised for cash

Proceeds from loan

8 unchanged sentences

Notes to Condensed Consolidated Interim Financial Statements

March 31, 2021

September 30, 2021

(expressed in US dollars and in thousands, except par value and per share amounts, unless otherwise noted)

2 unchanged sentences

Kintara Therapeutics, Inc.

(formerly DelMar Pharmaceuticals, Inc.) (the “Company”) is a clinical stage drug development company with a focus on the development of novel cancer therapies for patients with unmet medical needs.

(the “Company”) is a clinical stage drug development company with a focus on the development of novel cancer therapies for patients with unmet medical needs.

The Company is developing two late-stage, Phase 3-ready therapeutics - VAL-083 for glioblastoma multiforme and REM-001 for cutaneous metastatic breast cancer.

24 unchanged sentences

These condensed consolidated interim financial statements have been prepared on a going concern basis, which assumes that the Company will continue its operations for the foreseeable future and contemplates the realization of assets and the settlement of liabilities in the normal course of business .

For the nine months ended March 31, 2021, the Company reported a loss of $ 31,566 and a negative cash flow from operations of $ 14,171 .

The Company had an accumulated deficit of $ 104,489 and had cash and cash equivalents of $ 15,718 as of March 31, 2021.

For the three months ended September 30, 2021, the Company reported a loss of $ 5,966 and a negative cash flow from operations of $ 5,073 .

The Company had an accumulated deficit of $ 119,655 and had cash and cash equivalents of $ 19,339 as of September 30, 2021.

The Company is in the clinical stage and has not generated any revenues to-date.

17 unchanged sentences

The principal accounting policies applied in the preparation of these condensed consolidated interim financial statements are set out below and have been consistently applied to all periods presented.

Certain prior period balances have been reclassified to conform with the current period’s presentation.

Unaudited interim financial data

2 unchanged sentences

GAAP for complete financial statements.

These unaudited condensed consolidated interim financial statements should be read in conjunction with the audited financial statements of the Company as at June 30, 2020 included in the Company’s Form 10-K.

These unaudited condensed consolidated interim financial statements should be read in conjunction with the June 30, 2021 audited financial statements of the Company included in the Company’s Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on September 28, 2021.

In the opinion of management, the unaudited condensed consolidated interim financial statements reflect all adjustments, consisting of normal and recurring adjustments, necessary for a fair presentation.

The results for three and nine-months ended March 31, 2021 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2021, or for any other future annual or interim period.

The results for three-months ended September 30, 2021 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2022, or for any other future annual or interim period.

Use of estimates

2 unchanged sentences

Actual results could significantly differ from those estimates.

Significant areas requiring management to make estimates include the fair value of the milestone payment liability, the valuation of equity instruments issued for services, and clinical trial accruals.

Significant areas requiring management to make estimates include the valuation of equity instruments issued for services and clinical trial accruals.

Further details of the nature of these assumptions and conditions may be found in the relevant notes to these condensed consolidated interim financial statements.

1 unchanged sentence

Income or loss per share is calculated based on the weighted average number of common shares outstanding.

For the three and nine-month periods ended March 31, 2021 and 2020 diluted loss per share does not differ from basic loss per share since the effect of the Company’s warrants, stock options, and convertible preferred shares is anti-dilutive.

As of March 31, 2021, potential common shares of 8,226 (2020 – 10,209 ) related to outstanding common share warrants, 2,104 (2020 – nil) related to outstanding Series C preferred stock warrants, 6,453 (2020 – 779 ) related to stock options, 150 (2020 – 162 ) relating to outstanding Series B convertible preferred shares, and 17,997 (2020 – nil) relating to outstanding Series C convertible preferred shares were excluded from the calculation of net loss per common share.

For the three-month periods ended September 30, 2021, and 2020 diluted loss per share does not differ from basic loss per share since the effect of the Company’s warrants, stock options, and convertible preferred shares is anti-dilutive.

As of September 30, 2021, potential common shares of 19,152 (2020 – 11,858 ) related to outstanding common share warrants, 2,100 (2020 – 2,153 ) related to outstanding Series C preferred stock warrants, 6,809 (2020 – 6,544 ) related to stock options, nil (2020 – 162 ) relating to outstanding Series B convertible preferred shares, and 15,828 (2020 – 21,516 ) relating to outstanding Series C convertible preferred shares were excluded from the calculation of net loss per common share.

Acquired in-process research and development expense

The Company acquired in-process research and development assets in connection with its Merger with Adgero.

As the acquired in-process research and development assets were deemed to have no current or alternative future use, an expense of $ 16,094 was recognized in the condensed consolidated interim statements of operations for the nine-month period ended March 31, 2021.

Property and equipment

Property and equipment is stated at cost less accumulated depreciation.

The Company acquired in-process research and development assets in connection with its Merger with Adgero (note 3).

As the acquired in-process research and development assets were deemed to have no current, or alternative future use, an expense of $ 16,094 was recognized in the condensed consolidated interim statements of operations for the three-month period ended September 30, 2020.

Property, equipment, and intangibles

Property, equipment and intangibles are stated at cost less accumulated depreciation.

Depreciation is calculated on a straight-line basis over its estimated useful life of three years .

Depreciation expense is recognized from the date the equipment is put into use.

Depreciation expense is recognized from the date the equipment was put into use.

Recent accounting pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date.

Not yet adopted

Accounting Standards Update (“ASU”) 2020-06 — Debt - Debt with conversion and other options (subtopic 470-20) and derivatives and hedging – contracts in entity’s own equity (subtopic 815-40):

accounting for convertible instruments and contracts in an entity’s own equity

The amendments in this update are intended to simplify the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity.

The ASU is part of the FASB’s simplification initiative, which aims to reduce unnecessary complexity in U.S.

For public business entities that are not smaller reporting companies, the ASU’s amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years.

For all other entities, the effective date is for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years.

The guidance may be early adopted for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years.

The Company has not yet evaluated the impact of adoption of this ASU on its condensed consolidated interim financial statements and related disclosures.

ASU 2020-10 — Codification Improvements

The amendments in this update remove references to various FASB Concepts Statements, situates all disclosure guidance in the appropriate disclosure section of the Codification, and makes other improvements and technical corrections to the Codification.

The amendments in Sections B and C of this amendment are effective for fiscal periods beginning after December 15, 2020, for public business entities.

For all other entities, the amendments are effective for fiscal periods beginning after December 15, 2021, and interim periods within fiscal periods beginning after December 15, 2022.

The Company has not yet evaluated the impact of adoption of this ASU on its condensed consolidated interim financial statements and related disclosures.

ASU 2021-04 — Earnings Per Share (Topic 260), Debt— Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40):

Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options.

The amendments in this update are intended to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange and that are not within the scope of another FASB Accounting Standards Codification.

The amendments in ASU 2021-04 are effective for all entities for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years.

An entity should apply the amendments prospectively to modifications or exchanges occurring on or after the effective date of the amendments.

Early adoption is permitted for all entities, including adoption in an interim period.

The Company has not yet evaluated the impact of adoption of this ASU on its condensed consolidated interim financial statements and related disclosures.

During the nine-months ended March 31, 2021, other than ASUs 2020-06, 2020-10, and 2021-04, there have been no new, or existing recently issued, accounting pronouncements that are of significance, or potential significance, that impact the Company’s condensed consolidated interim financial statements.

During the three-months ended September 30, 2021, there have been no new, or existing recently issued, accounting pronouncements that are of significance, or potential significance, that impact the Company’s condensed consolidated interim financial statements.

As described in note 1, on August 19, 2020, the Company completed its Merger with Adgero in accordance with the terms of the Merger Agreement.

To determine the accounting for this transaction under ASU 2017-01, an assessment was made as to whether an integrated set of assets and activities should be accounted for as an acquisition of a business or an asset acquisition.

The guidance requires an initial screen test to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single asset or group of similar assets.

If that screen is met, the set is not a business.

In connection with the Merger, substantially all of the fair value is concentrated in in-process research and development (“IPR&D”).

In connection with the Merger, substantially all of the fair value was concentrated in in-process research and development (“IPR&D”).

As such, the Merger has been treated as an acquisition of Adgero assets and an assumption of Adgero liabilities.

Under the terms of the Merger Agreement, upon closing of the Merger, the Company issued 11,439 shares of Company common stock and 2,315 stock purchase warrants to the security holders of Adgero (“Adgero Warrants”).

Under the terms of the Merger Agreement, upon closing of the Merger, the Company issued 11,439 shares of Company common stock and 2,315 stock purchase warrants (“Adgero Warrants”) to the security holders of Adgero.

The Adgero Warrants are exercisable at $ 3.18 per share (note 7).

The Adgero Warrants were valued using a Black-Scholes valuation with a weighted-average risk-free interest rate of 0.21 %, a term of one year , a volatility of 115.96 %, and a dividend rate of 0 %.

The estimated volatility of the Company’s common stock at the date of measurement is based on the historical volatility of the Company.

The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the expected remaining life of the instrument at the valuation date.

The expected term has been estimated using the remaining life of the warrant.

Also, in conjunction with the Merger, the Company issued 572 shares of common stock to the placement agent as a success fee.

The shares of common stock issued to the former Adgero stockholders as well as the success fee shares, have been valued at $ 1.34 per share which was the closing price of the Company’s common stock on August 19, 2020, the date the Merger closed.

The Company incurred approximately $ 1,553 of legal, consulting and other professional fees related to the Merger, of which approximately $ 1,054 had been incurred in the year ended June 30, 2020.

The transaction costs applicable to the current period have been classified as merger expenses in the accompanying unaudited condensed consolidated interim statement of operations for the nine months ended March 31, 2021.

The following summarizes total consideration transferred to the Adgero stockholders under the Merger as well as the assets acquired and liabilities assumed under the Merger:

(in thousands)

Consideration:

Success fee shares

Net assets acquired:

Other current assets

Property and equipment (note 5)

Accounts payable and accrued liabilities

Milestone payment liability

In-process research and development

The fair value of the IPR&D assets has been expensed as a charge in the condensed consolidated interim statements of operations for the nine months ended March 31, 2021 as there is no alternative use for these assets.

Property and equipment include office furniture that was subsequently sold and laboratory equipment that has not yet been put into use.

The milestone payment liability relates to an asset purchase agreement with St.

The aggregate fair value of consideration transferred to the Adgero shareholders was $ 16,725 .

As part of the Merger, the Company acquired in-process research and development of $ 16,094 and other net assets of $ 631 .

The fair value of the acquired in-process research and development assets has been expensed as a charge in the condensed consolidated interim statements of operations for the three months ended September 30, 2020, as there is no alternative use for these assets.

The Company incurred approximately $ 1,554 of legal, consulting and other professional fees related to the Merger of which approximately $ 500 was incurred during the three months ended September 30, 2020.

The transaction costs have been classified as merger expenses in the condensed consolidated statement of operations.

In connection with the Merger, the Company recorded a milestone payment liability which relates to an asset purchase agreement with St.

Cloud Investments, LLC (“St.

10 unchanged sentences

With respect to the $300 and $700 potential milestone payments referenced above (each a “Milestone Payment”), if either such Milestone Payment becomes payable, and in the event the Company elects to pay either such Milestone Payment in shares of its common stock, the value of the common stock will equal the average of the closing price per share of the Company’s common stock over the twenty (20) trading days following the first public announcement of the applicable event described above.

The milestone payment liability has been determined using the discounted cash flow value of the two respective milestone payments.

A discount rate of 70 % has been used which accounts for the probability of success given the phase of clinical development of REM-001.

The term is based on an estimate of the planned timing of completion of the respective milestones that would result in payment of the milestones.

As of March 31, 2021, the Company reviewed its estimates with respect to the planned timing of completion of the respective milestones and adjusted the liability accordingly.

As of September 30, 2021, the Company reviewed its estimates with respect to the planned timing of completion of the respective milestones and adjusted the liability accordingly.

(in thousands)

1 unchanged sentence

Change in fair value estimate

Balance – March 31, 2021

Balance – June 30, 2021

Change in fair value estimate

Balance – September 30, 2021

Clinical trial deposit

2 unchanged sentences

The Company is required to make certain payments under the agreement related to patient enrollment milestones.

For the three and nine months ended March 31, 2021, the Company has recognized $ 1,708 and $ 2,958 , respectively, of expenses for this study in relation to study startup and preparation for patient enrollment.

In relation to this study, the Company has made a deposit payment of $ 2,600 to the CRO in relation to the commencement of recruitment of patients.

It is anticipated that the deposit will be applied to future invoices, or refunded to the Company, of which $ 500 is anticipated to be applied in the near term and $ 2,100 beyond twelve months from March 31, 2021.

For the three months ended September 30, 2021, the Company has recognized $ 1,952 (2020 – $nil) of expenses for this study in relation to clinical site initiation and patient enrollment.

In relation to this study, the Company has made a deposit payment of $ 2,100 to the CRO.

It is anticipated that the deposit will be applied to future invoices, or refunded to the Company, beyond twelve months from September 30, 2021.

The Company can terminate the study at any time.

Upon termination, the Company will be liable for any payments due to the effective date of the termination as well as any non-refundable costs incurred by the CRO prior to the date of termination.

Property and equipment

Property, equipment and intangibles

Balance, June 30, 2020

Acquired in Adgero merger (note 3)

1 unchanged sentence

Disposal of furniture

Property and equipment

Property, equipment and intangibles

Less accumulated depreciation

Balance, March 31, 2021

Balance, June 30, 2021

Less accumulated depreciation

Balance, September 30, 2021

Related party transactions

9 unchanged sentences

The holder of the Series A Preferred Stock is entitled to dividends at the rate of 3 % of the Series A Stated Value per year, payable quarterly in arrears.

For the three-months ended March 31, 2021 and 2020 respectively, the Company recorded $ 2 related to the dividend paid to Valent while for the nine-months ended March 31, 2021 and 2020 respectively, the Company recorded $ 6 related to the dividend.

For the three-months ended September 30, 2021, and 2020 respectively,

the Company recorded $ 2 related to the dividend paid to Valent .

The dividends have been recorded as a direct increase in accumulated deficit.

Related party payables

At March 31, 2021 there is an aggregate amount of $ 385 (June 30, 2020 - $ 664 ) payable to the Company’s officers and directors for fees, expenses, and accrued bonuses and other liabilities.

Loan from National Brain Tumor Society and National Foundation for Cancer Research

(in thousands)

Balance – June 30, 2020

Financing costs

Interest expense

Amortization of deferred financing costs

Balance – March 31, 2021

During the nine-months ended March 31, 2021, the Company received a loan of $ 500 from National Brain Tumor Society (“NBTS”) and the National Foundation for Cancer Research to support VAL-083's preparation for participation in the Global Coalition for Adaptive Research's (“GCAR”) sponsored trial, Glioblastoma (“GBM”) Adaptive Global Innovative Learning Environment (“GBM AGILE”) study (the “NBTS Loan”).

In relation to the NBTS Loan, the Company issued 125 share purchase warrants which are exercisable at a price of $ 1.09 per common share until June 19, 2025 and had been included in deferred financing costs as of June 30, 2020 (“NBTS Warrants”).

The NBTS Loan is secured by a promissory note, accrues interest at a rate of 6 % per annum and matures on June 19, 2021 .

The NBTS Warrants were valued at $ 94 using a Black-Scholes valuation with a risk-free interest rate of 0.37 %, a term of 5 years, a volatility of 89.82 %, and a dividend rate of 0 %.

The estimated volatility of the Company’s common stock at the date of measurement is based on the historical volatility of the Company.

The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the expected remaining life of the instrument at the valuation date.

The expected term has been estimated using the remaining life of the warrant.

At September 30, 2021 there is an aggregate amount of $ 491 (June 30, 2021 - $ 561 ) payable to the Company’s officers and directors for fees, expenses, and accrued bonuses and other liabilities.

Stockholders’ equity

4 unchanged sentences

Balance – June 30, 2020

Issued on exercise of Series C Preferred Agent Warrants

Issued on exercise of Series C Agent Warrants

Conversion of Series C Preferred stock to common stock

Balance – March 31, 2021

In connection with the Merger (note 3), the Company issued 25,028 shares of Series C Convertible Preferred Stock (the “Series C Preferred Stock”) in three separate closings of a private placement (Series C-1, C-2, and C-3) in August, 2020.

Balance – June 30, 2021

Conversion of Series C Preferred stock to common stock

Balance – September 30, 2021

In connection with the Merger (note 3), in August 2020, the Company issued 25,028 shares of Series C Convertible Preferred Stock (the “Series C Preferred Stock”) in three separate closings of a private placement (Series C-1, C-2, and C-3).

Each share of Series C Preferred Stock was issued at a purchase price of $ 1,000 per share and is convertible into shares of common stock based on the respective conversion prices which were determined at the closing of each round of the private placement.

The conversion prices for the Series C-1 Preferred Stock, Series C-2 Preferred Stock, and the Series C-3 Preferred Stock are $ 1.16 , $ 1.214 , and $ 1.15 , respectively.

Subject to ownership limitations, the owners of the Series C Preferred Stock are entitled to receive dividends, payable in shares of common stock at a rate of 10 %, 15 %, 20 % and 25 % of the number of shares of common stock issuable upon conversion of the Series C Preferred Stock, on the 12 th , 24 th , 36 th and 48 th month, anniversary of the initial closing of the private placement which occurred on August 19, 2020.

The Series C Preferred Stock dividends do not require declaration by the Board of Directors and are accrued annually as of the date the dividend is earned in an amount equal to the applicable rate of the stated value.

The Series C Preferred Stock dividends do not require declaration by the Board of Directors and are accrued annually as of the date the dividend is earned in an amount equal to fair value of the Company’s common stock on the dates the respective dividends are paid.

The fair value of the Series C Preferred Stock dividend paid on August 19, 2021, was determined by multiplying the dividends paid of 1,698 by the Company’s closing share price on August 19, 2021, of $ 1.45 per share for a total fair value of $ 2,462 .

Any outstanding shares of Series C Preferred Stock will automatically convert to shares of common stock on August 19, 2024 .

The conversion prices for the Series C-1 Preferred Stock, Series C-2 Preferred Stock and Series C-3 Preferred Stock are $ 1.16 , $ 1.214 and $ 1.15 , respectively.

Based on the conversion prices of the three respective classes of the Series C Preferred Stock, the originally issued 25,028 shares of Series C Preferred Stock were convertible into an aggregate of 21,516 shares of common stock.

The cumulative dividends to be issued on the 12 th , 24 th , 36 th and 48 th month anniversary of the initial closing of the private placement for the initially issued 25,028 shares of Series C Preferred Stock were 15,062 shares of common stock.

Total gross proceeds from the private placement were $ 25,028 , or approximately $ 21,573 in net proceeds after deducting financing costs of $ 3,455 with respect to agent commissions and expenses, as well as legal and accounting fees.

In addition, the Company issued 2,504 Series C Preferred Stock purchase warrants with a fair value of $ 3,287 to the placement agent (“Series C Agent Warrants”).

The Company’s Series C Preferred Stock outstanding, conversion shares, and dividends as of September 30, 2021, are as follows:

Dividend Shares (in thousands)

Series C Dividends

Dividend Shares

(in thousands)

10% - August 19, 2021 (actual)

15% - August 19, 2022 (estimated)

20% - August 19, 2023 (estimated)

25% - August 19, 2024 (estimated)

The conversion feature of the Series C Convertible Preferred Stock at the time of issuance was determined to be beneficial on the commitment date.

Because the Series C Convertible Preferred Stock was perpetual with no stated maturity date, and the conversions could occur any time from inception, the Company immediately recorded a non-cash deemed dividend of $ 3,181 related to the beneficial conversion feature arising from the issuance of Series C Convertible Preferred Stock.

This non-cash deemed dividend increased the Company’s net loss attributable to common stockholders and net loss per share.

This non-cash deemed dividend increased the Company’s net loss attributable to common stockholders and net loss per share for the three months ended September 30, 2020 .

The Series C Preferred Stock shall with respect to distributions of assets and rights upon the occurrence of a liquidation, rank (i) senior to the Company’s common stock and (ii) senior to any other class or series of capital stock of the Company hereafter created which does not expressly rank pari passu with, or senior to, the Series C Preferred Stock.

The Series C Preferred Stock shall be pari passu in liquidation to the Company’s Series A and Series B Preferred Stock.

The liquidation value of the Series C Preferred Stock at March 31, 2021 is the stated value of $ 20,903 .

Total gross proceeds from the private placement were $ 25,000 , or approximately $ 21,598 in net proceeds after deducting financing costs of $ 3,402 with respect to agent commissions and expenses, as well as legal and accounting fees.

Of the total financing costs, $ 85 was deferred as of June 30, 2020.

In addition, the Company issued warrants to purchase 2,504 shares of Series C Stock to the placement agent (“Series C Agent Warrants”) that are convertible into an aggregate 2,153 shares of common stock.

A total of 20,903 (June 30, 2020 – nil) shares of Series C Preferred Stock are outstanding as of March 31, 2021, such that a total of 17,997 (June 30, 2020 – nil) shares of common stock are issuable upon conversion of the Series C Preferred Stock as of March 31, 2021.

Converted shares are rounded up to the nearest whole share.

Series B Preferred Stock

The Series C Preferred Stock shall be pari passu in liquidation to the Company’s Series A Preferred Stock.

The liquidation value of the Series C Preferred Stock at September 30, 2021, is the stated value of $ 18,382 (June 30, 2021 - $ 20,092 ).

Series B Preferred Stock

(in thousands)

Balance – June 30, 2020

Conversion of Series B Preferred stock to common

Balance – March 31, 2021

During the year ended June 30, 2016, the Company issued an aggregate of 902 shares of Series B Preferred Stock at a purchase price of $ 8.00 per share.

Each share of Series B Preferred Stock is currently convertible into 0.25 shares of common stock equating to a conversion price of $ 32.00 (the “Conversion Price”) and will automatically convert to common stock at the earlier of 24 hours following regulatory approval of VAL-083 with a minimum closing bid price of $ 80.00 per share, or five years from the date of the filing of the Certificate of Designation which was April 29, 2016.

Therefore, all of the Series B Preferred stock will convert to common stock on April 29, 2021 .

The holders of the Series B Preferred Stock are entitled to an annual cumulative, in arrears, dividend at the rate of 9 % payable quarterly.

The 9% dividend accrues quarterly commencing on the date of issue and is payable quarterly on September 30, December 31, March 31, and June 30 of each year commencing on June 30, 2016.

Dividends are payable solely by delivery of shares of common stock, in an amount for each holder equal to the aggregate dividend payable to such holder with respect to the shares of Series B Preferred Stock held by such holder divided by the Conversion Price.

The Series B Preferred Stock does not contain any repricing features.

Each share of Series B Preferred Stock entitles its holder to vote with the common stock on an as-converted basis.

The Series B Preferred Stock shall with respect to distributions of assets and rights upon the occurrence of a liquidation, rank (i) senior to the Company’s common stock and (ii) senior to any other class or series of capital stock of the Company hereafter created which does not expressly rank pari passu with, or senior to, the Series B Preferred Stock.

The Series B Preferred Stock shall be pari passu in liquidation to the Company’s Series A and Series C Preferred Stock.

The liquidation value of the Series B Preferred Stock at March 31, 2021 is the stated value of $ 4,808 (June 30, 2020 - $ 5,192 ).

In addition, the Company and the holders entered into a royalty agreement, pursuant to which the Company will pay the holders of the Series B Preferred Stock, in aggregate, a low, single-digit royalty based on their pro rata ownership of the Series B Preferred Stock on products sold directly by the Company or sold pursuant to a licensing or partnering arrangement (the “Royalty Agreement”).

Upon conversion of a holder’s Series B Preferred Stock to common stock, such holder shall no longer receive ongoing royalty payments under the Royalty Agreement but will be entitled to receive any residual royalty payments that have vested.

Rights to the royalties shall vest during the first three years following the applicable closing date, in equal thirds to holders of the Series B Preferred Stock on each of the three vesting dates, upon which vesting dates such royalty amounts shall become vested royalties.

Pursuant to the Series B Preferred Stock dividend, during the three-months ended March 31, 2021, the Company issued 3 (2020 – 4 ) shares of common stock and recognized $ 6 (2020 – $ 1 ) and during the nine-months ended March 31, 2021, the Company issued 10 (2020 – 12 ) shares of common stock and recognized $ 15 (2020 – $ 6 ).

These dividends have been recognized as a direct increase in accumulated deficit.

A total of 601 (June 30, 2020 – 649 ) shares of Series B Preferred Stock are outstanding as of March 31, 2021, such that a total of 150 (June 30, 2020 – 162 ) shares of common stock are issuable upon conversion of the Series B Preferred Stock as of March 31, 2021.

Converted shares are rounded up to the nearest whole share.

During the year ended June 30, 2016, the Company issued 902 shares of Series B Preferred Stock.

The remaining balance of 601 shares of Series B Preferred Stock were fully converted to 150 shares of common stock on April 29, 2021.

The holders of the Series B Preferred Stock were entitled to an annual cumulative, in arrears, dividend at the rate of 9 % payable quarterly.

The 9% dividend accrued quarterly commencing on the date of issue and was payable quarterly on September 30, December 31, March 31, and June 30 of each year commencing on June 30, 2016.

Dividends were payable solely by delivery of shares of common stock, in an amount for each holder equal to the aggregate dividend payable to such holder with respect to the shares of Series B Preferred Stock held by such holder divided by the conversion price.

Pursuant to the Series B Preferred Stock dividend, during the three-months ended September 30, 2021, the Company issued nil (2020 – 4 ) shares of common stock and recognized $nil (2020 - $ 5 ) as an increase in accumulated deficit.

In addition, the Company and the Series B Preferred Stock holders entered into a royalty agreement, pursuant to which the Company will pay the holders of the Series B Preferred Stock, in aggregate, a low, single-digit royalty based on their pro rata ownership of the Series B Preferred Stock on products sold directly by the Company or sold pursuant to a licensing or partnering arrangement.

Series A Preferred Stock

6 unchanged sentences

The Series A Preferred Stock shall with respect to distributions of assets and rights upon the occurrence of a liquidation, rank (i) senior to the Company’s common stock, and (ii) senior to any other class or series of capital stock of the Company hereafter created which does not expressly rank pari passu with, or senior to, the Series A Preferred Stock.

The Series A Preferred Stock shall be pari passu in liquidation to the Company’s Series B and Series C Preferred Stock.

The liquidation value of the Series A Preferred stock at March 31, 2021 and June 30, 2020 was $ 279 .

There was no change to the Series A Preferred stock for the three or nine-months ended March 31, 2021 or March 31, 2020.

Stock Issuances

Nine months ended March 31, 2020

Underwritten public offering

On August 16, 2019, the Company closed on the sale of (i) 4,895 shares of its common stock, par value $ 0.001 per share (the “Common Stock”), (ii) pre-funded warrants (“PFW”) to purchase an aggregate of 2,655 shares of Common Stock and (iii) common warrants to purchase an aggregate of 7,763 shares of Common Stock (“2020 Investor Warrants”), including 800 shares of Common Stock and 2020 Investor Warrants to purchase an aggregate of 1,013 shares of Common Stock sold pursuant to a partial exercise by the underwriters of the underwriters’ option to purchase additional securities, in the Company’s underwritten public offering (the “Offering”).

Each share of Common Stock or PFW, as applicable, was sold together with a 2020 Investor Warrant to purchase one share of Common Stock at a combined effective price to the public of $1.00 per share of Common Stock and accompanying 2020 Investor Warrant.

The net proceeds from the Offering, including from the partial exercise of the underwriters’ option to purchase additional securities, were $ 6,583 after deducting underwriting discounts and commissions, and other offering expenses.

The 2020 Investor Warrants are exercisable at $1.00 per share until their expiry on August 16, 2024 and the PFW are exercisable at $0.01 per share at any time after August 16, 2019.

The Company also issued 377 warrants to the underwriters of the Offering.

The underwriter warrants are exercisable at $ 1.15 per share commencing February 10, 2020 until their expiry on August 14, 2022 .

During the nine months ended March 31, 2020, all of the 2,655 PFW were exercised at $ 0.01 per PFW for proceeds of $ 27 .

Shares issued for services

During the nine months ended March 31, 2021, the Company issued nil (2020 – 21 ) shares of common stock for services resulting in the recognition of nil (2020 – $ 12 ) in expense.

All of the shares issued for services for the three and nine months ended March 31, 2020 have been recognized as research and development expense.

The Series A Preferred Stock shall be pari passu in liquidation to the Company’s Series C Preferred Stock.

The liquidation value of the Series A Preferred stock at September 30, 2021 is its stated value of $ 279 (June 30, 2021 - $ 279 ).

There was no change to the Series A Preferred stock for the three-months ended September 30, 2021 or 2020.

Stock issuances during the three months ended September 30, 2021

Registered direct financing

On September 28, 2021, the Company closed on the sale of (i) 7,200 shares of its common stock, par value $ 0.001 per share (the “Common Stock”), (ii) pre-funded warrants (“PFW”) to purchase an aggregate of 4,800 shares of Common Stock and (iii) common warrants to purchase an aggregate of 12,000 shares of Common Stock (“2022 Investor Warrants”) in the Company’s registered direct offering (the “Offering”).

Each share of Common Stock, or PFW as applicable, was sold together with a 2022 Investor Warrant to purchase one share of Common Stock at a combined effective price of $1.25 per share of Common Stock and accompanying 2022 Investor Warrant.

The 2022 Investor Warrants have been valued at $ 7,023 and have been treated as equity.

They have been valued using a Black-Scholes valuation with a risk-free rate of 0.55 %, a contractual term of 3.5 years, a volatility of 116.7 %, and a dividend rate of 0 %.

The estimated volatility of the Company’s common stock is based on the historical volatility of the Company.

The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the contractual life of the instrument at the valuation date.

The term is based on the contractual term of the warrant.

The net proceeds from the Offering, were $ 13,634 after deducting commissions and other offering expenses.

The 2022 Investor Warrants are exercisable at $1.25 per share until their expiry on March 28, 2025 and the PFW are exercisable at $0.001 per share at any time after September 28, 2021.

The Company also issued 600 agent warrants that are exercisable at $ 1.5265 per share commencing September 28, 2021 , until their expiry on March 28, 2025 (the “2022 Agent Warrants”).

The 2022 Agent Warrants have been valued at $ 333 and have been treated as non-cash issue costs of the Common Stock, 2022 Investor Warrants, and PFW.

The 2022 Agent Warrants have been valued using a Black-Scholes valuation with a risk-free rate of 0.55 %, a contractual term of 3.5 years, a volatility of 116.7 %, and a dividend rate of 0 %.

The estimated volatility of the Company’s common stock is based on the historical volatility of the Company.

The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the contractual life of the instrument at the valuation date.

The term is based on the contractual term of the warrant .

During the three months ended September 30, 2021, all of the 4,800 PFW were exercised at $ 0.001 per PFW for proceeds of $ 4.8 .

Stock options

2017 Omnibus Incentive Plan

The Company’s Board of Directors has approved adoption of the Company’s 2017 Omnibus Equity Incentive Plan (the “2017 Plan”) that has also been approved by the Company’s stockholders.

In addition, the Board of Directors approved a form of Performance Stock Unit Award Agreement to be used in connection with grants of performance stock units (“PSUs”) under the 2017 Plan.

Under the 2017 Plan, 6,700 shares of Company common stock are currently reserved for issuance, less the number of options to purchase shares of common stock issued under the Del Mar (BC) 2013 Amended and Restated Stock Option Plan (the “Legacy Plan”) or that are subject to grants of options to purchase shares of common stock made, or that may be made, under the Legacy Plan.

As of March 31, 2021, a total of 142 options to purchase shares of common stock are outstanding under the Legacy Plan and/or are subject to outstanding options to purchase shares of common stock granted under the Legacy Plan, and a total of 6,380 options to purchase shares of common stock have been issued under the 2017 Plan and/or are subject to outstanding options to purchase shares of common stock granted under the 2017 Plan leaving 178 options to purchase shares of common stock available at March 31, 2021 for issuance under the 2017 Plan if all such options to purchase shares of common stock under the Legacy Plan were exercised.

As subsequently approved by the Company’s stockholders at an annual meeting of stockholders on April 11, 2018, the Company’s board of directors approved adoption of the Company’s 2017 Omnibus Equity Incentive Plan (the “2017 Plan”).

The board of directors also approved a form of Performance Stock Unit Award Agreement to be used in connection with grants of performance stock units (“PSUs”) under the 2017 Plan.

As approved by the Company’s stockholders on June 25, 2021, the number of common shares available under the 2017 Plan was increased to 13,000 shares.

Under the 2017 Plan 13,000 shares of Company common stock are currently reserved for issuance, less the number of shares of common stock issued under the Del Mar (BC) 2013 Amended and Restated Stock Option Plan (the “Legacy Plan”), or that are subject to grants of stock options made, or that may be made, under the Legacy Plan, or that have been previously exercised.

A total of 129 shares of common stock have been issued under the Legacy Plan and/or are subject to outstanding stock options granted under the Legacy Plan, and a total of 6,680 shares of common stock have been issued under the 2017 Plan and/or are subject to outstanding stock options granted under the 2017 Plan leaving 5,997 shares of common stock available at September 30, 2021 for issuance under the 2017 Plan if all such options under the Legacy Plan were exercised, net of stock options previously exercised.

The maximum number of shares of Company common stock with respect to which any one participant may be granted awards during any calendar year is 8 % of the Company’s fully diluted shares of common stock on the date of grant (excluding the number of shares of common stock issued under the 2017 Plan and/or the Legacy Plan or subject to outstanding awards granted under the 2017 Plan and/or the Legacy Plan).

No award will be granted under the 2017 Plan on, or after, July 7, 2027.

During the nine-months ended March 31, 2021, a total of 223 options to purchase shares of common stock issued to directors of the Company were amended such that the period to exercise vested options to purchase shares of common stock from the date of termination of continuous service with the Company was extended from 90 days to one year .

Of the total, 67 had their expiry extended from September 26, 2020 to June 26, 2021 and 156 had their expiry extended from November 19, 2020 to August 19, 2021.

As a result of the amendments, a total of $9 in stock-based compensation expense has been recognized.

In addition, 250 options to purchase shares of common stock previously granted to an officer of the Company were amended such that the vesting of the options to purchase shares of common stock was changed from a completely contingent vesting to a time-based vesting such that 1/6 th of the options to purchase shares of common stock vest on the six-month anniversary of the amendment date with the remaining portion vesting in equal monthly installments over a period of 30 months commencing on the seven-month anniversary of the amendment date.

A total compensation expense of $ 319 will be recognized over the amended vesting period for the 250 options to purchase shares of common stock.

Also, during the nine months ended March 31, 2021, the Board of Directors approved the acceleration of vesting of 280 options to purchase shares of common stock previously granted on September 5, 2019 to an executive officer of the Company resulting in accelerated expense of $ 53 .

The exercise price of the options to purchase shares of common stock is $ 0.61 per share.

During the nine-months ended March 31, 2021, a total of 4,759 options to purchase shares of common stock were granted to executive officers and directors of the Company.

Of these, 4,699 have an exercise price of $ 1.70 per share and 60 have an exercise price of $ 1.355 per share.

Of the total granted, 4,279 options to purchase shares of common stock vest as to 1/6 on the six-month anniversary of the grant date with the remaining portion vesting in equal monthly installments over a period of 30 months commencing on the seven-month anniversary of the grant date.

Of the total options to purchase shares of common stock granted to executive officers and directors, 480 vest in 12 equal monthly installments beginning on October 15, 2020.

During the three-months ended September 30, 2021, a total of 435 options to purchase shares of common stock were granted to directors of the Company.

The options to purchase shares of common stock of the Company have an exercise price of $ 1.24 per share.

They vest in 12 equal monthly installments beginning on October 22, 2021.

All of the options to purchase shares of common stock granted have a 10-year term and are subject to cancellation upon the grantees’ termination of service for the Company, with certain exceptions .

Stock Options

The following table sets forth changes in stock options outstanding under all plans:

2 unchanged sentences

Balance – June 30, 2021

Balance – March 31, 2021

The following table summarizes stock options outstanding and exercisable under all plans at March 31, 2021:

Balance – September 30, 2021

The following table summarizes stock options outstanding and exercisable under all plans at September 30, 2021:

Exercise price

Outstanding at

March 31, 2021

September 30, 2021

(in thousands)

2 unchanged sentences

exercisable at

March 31, 2021

September 30, 2021

(in thousands)

1 unchanged sentence

The exercise price of these options shown in the above table have been converted to US$ 15.77 per share using the period ending closing exchange rate.

Stock options granted during the nine months ended March 31, 2021 have been valued using a Black-Scholes pricing model with the following assumptions:

Stock options granted during the three months ended September 30, 2021, have been valued using a Black-Scholes pricing model with the following assumptions:

September 30,

Dividend rate

Estimated volatility

Risk-free rate

0.19% to 0.42

Expected term – years

The estimated volatility of the Company’s common stock at the date of issuance of the stock options is based on the historical volatility of the Company.

The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the expected remaining life of the stock options at the valuation date.

The expected life of the stock options has been estimated using the plain vanilla method.

The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the expected remaining term of the stock options at the valuation date.

The expected term of the stock options has been estimated using the plain vanilla method.

The Company has recognized the following amounts as stock option expense for the periods noted (in thousands) :

Three months ended

Nine months ended

September 30,

Research and development

General and administrative

All of the stock option expense for the periods ended March 31, 2021 and 2020 has been recognized as additional paid in capital.

The aggregate intrinsic value of stock options outstanding at March 31, 2021 was $ 1,618 (2020 - $ 0 ) and the aggregate

intrinsic value of stock options exercisable at March 31, 2021 was $ 1,044 ( 2020 - $ 0 ) .

As of March 31, 2021 , there was $ 3,959 i n unrecognized compensation expense that will be recognized over the next 2.5 0 years .

All of the stock option expense for the periods ended September 30, 2021, and 2020 has been recognized as additional paid in capital.

The aggregate intrinsic value of stock options outstanding at September 30, 2021 was $ 235 (2020 - $ 977 ) and the aggregate intrinsic value of stock options exercisable at September 30, 2021 was $ 197 (2020 - $ 447 ).

As of September 30, 2021, there was $ 2,597 in unrecognized compensation expense that will be recognized over the next 2.58 years.

The following table sets forth changes in unvested stock options under all plans:

1 unchanged sentence

Unvested at June 30, 2021

Unvested at March 31, 2021

The aggregate intrinsic value of unvested stock options at March 31, 2021 was $ 573 (2020 - $ 519 ).

Unvested at September 30, 2021

The aggregate intrinsic value of unvested stock options at September 30, 2021 was $ 38 (2020 - $ 531 ).

The unvested stock options have a remaining weighted average contractual term of 9.03 years (2020 – 9.83).

3 unchanged sentences

Balance – June 30, 2021

Issuance of Adgero Warrants

Exercise of warrants (i)

Warrants issued for services (ii)

Expiry of warrants (iii)

Balance – March 31, 2021

A total of 4,399 2020 Investor Warrants were exercised at $ 1.00 per share and 472 warrants issued as either agent warrants or issued for services were exercised on a cashless basis for which 258 common shares were issued.

Warrants issued for services are exercisable at various prices and expire at the various dates noted in the table below.

The warrant expiries include the 2015 Investor Warrants, the 2015 Agent Warrants, and certain warrants issued for services.

All of the expired warrants were exercisable at $ 30.00 per share.

The following table summarizes the Company’s outstanding common stock warrants as of March 31, 2021:

Issuance of 2022 Investor Warrants

Issuance of PFW

Issuance of 2022 Agent Warrants

Exercise of PFW

Exercise of 2020 Investor Warrants

Expiry of Adgero replacement warrants

Balance – September 30, 2021

The following table summarizes the Company’s outstanding common stock warrants as of September 30, 2021:

Description of warrants

1 unchanged sentence

2022 Investor warrants

March 28, 2025

2020 Investor warrants

August 16, 2024

5 unchanged sentences

NBTS Warrants

June 19, 2025 (i)

June 19, 2025

Warrants issued for services

20 unchanged sentences

February 25, 2024

2020 Underwriter Warrants

August 14, 2022

2022 Agent warrants

March 28, 2025

2019 Agent warrants

September 20, 2022

2018 Agent warrants

April 12, 2022

September 20, 2022

2017 Agent warrants

Adgero Warrants

April 12, 2022

Adgero Warrants

August 31, 2021

Adgero Warrants

January 17, 2022

NBTS Warrants were issued in connection with respect to the NBTS Loan (note 7).

Series C Preferred Stock warrants

10 unchanged sentences

Warrants Exercised

March 31, 2021

September 30, 2021

Issuance of Preferred Series C-1 Agent Warrants

1 unchanged sentence

Issuance of Preferred Series C-3 Agent Warrants

The following table summarizes the Company’s outstanding Series C Agent Warrants as of March 31, 2021:

The following table summarizes the Company’s outstanding Series C Agent Warrants as of September 30, 2021:

Series C Agent Warrants

1 unchanged sentence

The Company incurred the following non-cash investing and financing transactions (in thousands):

Three months ended

September 30,

Series C Preferred Stock common stock dividend (note 7)

Series B Preferred Stock common stock dividend (note 7)

1 unchanged sentence

Non-cash issue costs (note 7)

Cashless exercise of Series C warrants (note 8)

Issue costs in accounts payable and accrued liabilities

Income taxes paid

11 unchanged sentences

Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy.

As at March 31, 2021, the Company’s milestone payment liability was measured using level 3 inputs (note 3).

March 31, 2021

As at September 30, 2021, the Company’s milestone payment liability was measured using level 3 inputs (note 3).

September 30, 2021

Milestone payment liability

The Company’s financial instruments consist of cash and cash equivalents, other receivables, accounts payable, related party payables and loan payable.

The Company’s financial instruments consist of cash and cash equivalents, other receivables, accounts payable, and related party payables.

The carrying values of cash and cash equivalents, other receivables, accounts payable and related party payables approximate their fair values due to the immediate or short-term maturity of these financial instruments.

The fair value of the loan payable is equal to its principal and accrued interest of $ 523 as of March 31, 2021.

Subsequent events

Subsequent to March 31, 2021, the Company’s Board of Directors approved an increase in the Company’s authorized common share capital from 95,000 shares of common stock to 175,000 shares of common stock.

In addition, the Board of Directors approved an increase to the number of shares available under the 2017 Omnibus Equity Incentive Plan from 6,700 shares to 13,000 shares.

Both of these matters require stockholder approval at the Company’s annual general meeting of stockholders being held on June 25, 2021.

Subsequent to March 31, 2021, 1,206 stock purchase warrants exercisable at $ 3.18 per share and 10 exercisable at $ 40 per share expired.

Series C Preferred Stock

Subsequent to March 31, 2021, 125 shares of Series C-1 Preferred Stock were converted into 107,759 shares of common stock, 50 shares of Series C-2 Preferred Stock were converted into 41,188 shares of common stock, and 636 shares of Series C-3 Preferred Stock were converted into 553,047 shares of common stock.

Series B Preferred Stock

On April 29, 2021, all remaining shares of Series B Preferred Stock were converted into shares of common stock as a result of mandatory conversion corresponding to the fifth anniversary of their issuance.

As a result, 601 shares of Series B Preferred Stock were converted into 150 shares of common stock.

Subsequent to September 30, 2021, 0.65 shares of Series C-1 Preferred Stock were converted into 560 shares of common stock.

Stock options

Subsequent to March 31, 2021, 75 stock options were issued exercisable at $ 1.37 per share until April 29, 2031.

The Company has evaluated its subsequent events from March 31, 2021 through the date these condensed consolidated interim financial statements were issued and has determined that there are no subsequent events requiring disclosure in these condensed consolidated interim financial statements other than the items noted above.

On November 8, 2021, the Company issued 3,519 stock options to one of its officers.

The stock options are exercisable at $ 0.96 per share until November 8, 2031 , and vest 25 % on November 8, 2022 , with the remainder to vest in equal installments over the subsequent 36 months commencing on December 8, 2022.

In addition, 2,715 stock options previously issued to an officer of the Company were modified such that 754 stock options that were to vest over the period December 15, 2022 , to September 15, 2023 , now vest on a contingent basis dependent on the achievement of certain strategic partnership initiatives.

The Company has evaluated its subsequent events from September 30, 2021, through the date these condensed consolidated interim financial statements were issued and has determined that there are no subsequent events requiring disclosure in these condensed consolidated interim financial statements other than the items noted above.

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