Item 9A. Controls and Procedures
ITEM
9A. CONTROLS AND PROCEDURES
Evaluation
of Disclosure Controls and Procedures
Our
management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of
our “disclosure controls and procedures” as of December 31, 2024, the end of the period covered by this Annual Report on
Form 10-K. The term “disclosure controls and procedures” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act
means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in
the reports that it files under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in
the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to
ensure that information required to be disclosed by a company in the reports that it files under the Exchange Act is accumulated and
communicated to a company’s management, including its principal executive officer and principal financial officer, as appropriate
to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management
recognizes that any controls and procedures, no matter how well designed and operated, cannot provide absolute assurance that the objectives
of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of
fraud, if any, within a company have been detected. Based on the evaluation of our disclosure controls and procedures as of December
31, 2024, our management, with the participation of our principal executive officer and principal financial officer, has concluded that,
based on such evaluation, as of the end of the period covered by this Annual Report on Form 10-K, our disclosure controls and procedures
were not effective due to the material weakness described below. However, our management, including our principal executive officer and
principal financial officer, has concluded that, notwithstanding the identified material weakness in our internal control over financial
reporting, the financial statements in this Annual Report on Form 10-K fairly present, in a l material respects, our financial condition,
results of operations and cash flows for the periods presented in conformity with U.S. GAAP.
Material
Weakness in Internal Controls Over Financial Reporting
We
identified a material weakness in our internal control over financial reporting that exists as of December 31, 2024. A material weakness
is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility
that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. We determined
that we had a material weakness because, due to our small size, and our limited number of personnel, we did not have in place an effective
internal control environment with formal processes and procedures, including adequate segregation of duties within systems. Notwithstanding
the material weaknesses in our internal control over financial reporting, we have concluded that the consolidated financial statements
included in this Annual Report on Form 10-K fairly present, in a l material respects, our financial position, results of operations and
cash flows for the periods presented in conformity with accounting principles generally accepted in the United States of America.
Management’s
Plan to Remediate the Material Weakness
With
the oversight of senior management, we have implemented several remediation steps in 2025, including, but not limited to the following:
●
Added
personnel with significant relevant experience in public company internal control environments
●
Engaged
a reputable third-party expert to assist with enhancing our risk assessment and control testing processes
●
Established
additional points of segregation of duties across our key processes
●
Improved
our financial close process with the enhancement of our documentation and review of significant accruals, journal entries and account
reconciliations
●
Upgraded
our information technology general controls
75
We
believe these measures have strengthened our internal control over financial reporting, specifically as it relates to journal entry processing
and review, to allow for a detailed review of accounting transactions that would identify errors in a timely manner. We are committed
to continuing to improve our internal control processes and will continue to diligently review our financial reporting controls and procedures.
Management’s
Annual Report on Internal Control Over Financial Reporting and Auditor Attestation
Our
management is responsible for establishing and maintaining adequate internal controls over financial reporting, as defined under Rule
13a-15(f) under the Exchange Act. Our management has assessed the effectiveness of our internal controls over financial reporting as
of December 31, 2023 based on the framework established in Internal Control Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (2013 Framework) (“COSO”). Our internal control system was designed to provide reasonable
assurance to our management and board of directors regarding the preparation and fair presentation of published financial statements.
An internal control material weakness is a significant deficiency, or aggregation of deficiencies, that does not reduce to a relatively
low level the risk that material misstatements in financial statements will be prevented or detected on a timely basis by employees in
the normal course of their work. Our management assessed the effectiveness of our internal control over financial reporting as of December
31, 2024, and based on that evaluation, management concluded that our internal control over financial reporting was not effective as
of December 31, 2024. We determined that we had a material weakness because, due to our small size, and our limited number of personnel,
we did not have in place an effective internal control environment with formal processes and procedures, including adequate segregation
of duties within systems.
This
report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by our registered public accounting firm pursuant to the rules of the Securities
and Exchange Commission that permit us to provide only management’s report in this Annual Report.
Changes
in Internal Control Over Financial Reporting
Except
for the changes related to the remediation of the previously identified material weakness noted above, there was no change in our internal
control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange
Act that occurred during the fiscal quarter ended December 31, 2024, that has materially affected, or is reasonably likely to materially
affect, our internal control over financial reporting.
ITEM
9B. OTHER INFORMATION
(b)
Rule 10b5-1 Trading Plans.
Our
directors and executive officers may from time to time enter into plans or other arrangements for the purchase or sale of our shares
that are intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or may represent a non-Rule 10b5-1 trading arrangement
under the Exchange Act. During the quarter ended December 31, 2024, none of the Company’s directors or officers (as defined in
Rule 16a-1(f)) adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was
intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement”.
76
PART
III
ITEM
10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The
information required by this Item will be set forth under the headings “ Proposal 1. Election of Directors ”, “ Executive
Officers ”, “ Corporate Governance Standards and Director Independence ” (including under “ Code of
Business Conduct and Ethics ” and “ Insider Trading Policy ”), “ Committees of the Board ”,
and “ Delinquent Section 16(a) Reports ” (to the extent applicable and warranted), in the Company’s 2025 Proxy
Statement to be filed with the U.S. Securities and Exchange Commission within 120 days after December 31, 2024 in connection with the
solicitation of proxies for the Company’s 2025 annual meeting of shareholders and is incorporated herein by reference.
Insider
Trading Policies and Procedures
The
Company has an insider trading policy governing the purchase, sale and other dispositions of the Company’s securities that applies
to all Company personnel, including directors, officers, employees, and other covered persons. The Company also plans to follow procedures
for the repurchase of any shares of its securities. The Company believes that its insider trading policy and planned repurchase procedures
are reasonably designed to promote compliance with insider trading laws, rules and regulations, and listing standards applicable to the
Company. A copy of the Company’s insider trading policy is filed as Exhibit 19.1 to this Form 10-K.
ITEM
11. EXECUTIVE COMPENSATION
The
information required by this Item will be set forth under the headings: “ Executive Compensation ”-” Summary
Compensation Table ”, “ Narrative Disclosure to Summary Compensation Table ”, “ Equity Grant Practices ”,
“ Bonus Arrangements ”, “ Outstanding Equity Awards at December 31, 2024 ”, “ Non-Employee
Director Compensation ” and “ Outstanding Equity Awards at December 31, 2024 Held by Non-Employee Directors ”,
in the Company’s 2025 Proxy Statement to be filed with the SEC within 120 days after December 31, 2024 and is incorporated herein
by reference.
ITEM
12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The
information required by this Item will be set forth under the heading “ Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters ” and “ Equity Compensation Plan Information ”(including under “ Equity
Compensation Plan Table ”) in the Company’s 2025 Proxy Statement to be filed with the SEC within 120 days after December
31, 2024 and is incorporated herein by reference.
ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The
information required by this Item will be set forth under the headings “ Certain Relationships and Related Transactions ”
and “ Corporate Governance Standards and Director Independence ” - “ Director Independence ” in the
Company’s 2025 Proxy Statement to be filed with the SEC within 120 days after December 31, 2024 and is incorporated herein by reference.
ITEM
14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The
Company’s independent registered public accounting firm is Crowe LLP, Los Angeles, California; PCAOB ID#173. The
information required by this Item will be set forth under the heading “ Ratification of the Appointment of Our Independent Registered
Public Accounting Firm for Fiscal Year Ending December 31, 2025 ”-” Principal Accountant Fees and Services ”
in the Company’s 2025 Proxy Statement to be filed with the SEC within 120 days after December 31, 2024 and is incorporated herein
by reference.
77
PART
IV
ITEM
15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a)
The following documents are filed as part of this report:
(1)
Financial Statements:
Page
Index to Consolidated Financial Statements:
F-1
Consolidated
Financial Statements:
Report of Independent Registered Public Accounting Firm – Crowe LLP (PCAOB
ID: 173)
F-2
Report of the Independent Registered Public Accounting Firm (PCAOB ID: 170)
F-3
Consolidated Balance Sheets as of December 31, 2024 and 2023
F-4
Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2024 and 2023
F-5
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2024 and 2023
F-6
Consolidated Statements of Cash Flows for the years ended December 31, 2024 and 2023
F-7
Notes to the Consolidated Financial Statements
F-8
(b)
Exhibits
The
following documents are included as exhibits to this report.
Exhibit
No.
Title
of Document
3.1
Third Amended and Restated Certificate of Incorporation of Immix Biopharma, Inc. (Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 20, 2021)
3.2
Amended and Restated Bylaws (Incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K filed with the SEC on December 20, 2021)
4.1
Specimen Stock Certificate Evidencing the Shares of Common Stock (Incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 6, 2021)
4.2
Form of Representative’s Warrant (Incorporated by reference to Exhibit 4.2 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 28, 2021)
4.3
Form of Pre-Funded Warrant to Purchase Common Stock dated August 21, 2023 (Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on August 22, 2023)
4.3
Certificate of Ownership and Merger (filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on May 20, 2024 and incorporated herein by reference)
4.4*
Description of the Registrant’s Securities
10.1+
2021 Equity Incentive Plan (Incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 6, 2021)
10.2+
Form of Indemnification Agreement with Directors and Executive Officers (Incorporated by reference to Exhibit 10.2 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 6, 2021)
78
10.3#
IP License Agreement by and between the Company and Immix Biopharma Australia Pty Ltd dated January 23, 2017 (Incorporated by reference to Exhibit 10.3 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 6, 2021)
10.4+
Employment Agreement by and between the Company and Ilya Rachman dated June 18, 2021 (Incorporated by reference to Exhibit 10.5 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 6, 2021)
10.5+
Management Services Agreement by and between the Company and Alwaysraise LLC, dated March 18, 2021 (Incorporated by reference to Exhibit 10.6 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 6, 2021)
10.6
Master Service Agreement by and between the Company and AxioMx, Inc. dated December 22, 2014 (Incorporated by reference to Exhibit 10.7 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 6, 2021)
10.7#
Clinical Collaboration and Supply Agreement by and between the Company and BeiGene Switzerland GmbH dated August 20, 2021 (Incorporated by reference to Exhibit 10.8 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 15, 2021)
10.8+
Amendment to Employment Agreement by and between the Company and Ilya Rachman dated as of November 9, 2022 (Incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on November 9, 2022)
10.9+
Amendment to Master Services Agreement by and between the Company and Alwaysraise, LLC dated as of November 9, 2022 (Incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on November 9, 2022)
10.10#
Research and License Agreement entered into on December 8, 2022 by and between Nexcella, Inc. (formerly Immix Biopharma Cell Therapy, Inc.), Hadasit Medical Research Services & Development, Ltd. and BIRAD Research and Development Company Ltd. (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 14, 2022)
10.11
Form of Share Purchase Agreement (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on January 18, 2023)
10.12*
Senior Unsecured Promissory Note issued by Nexcella, Inc. to Immix Biopharma, Inc. on December 21, 2022 (Incorporated by reference to Exhibit 10.12 to the Company’s Annual Report on Form 10-K filed with the SEC on March 27, 2023.
10.13+
2016 Equity Incentive Plan (Incorporated by reference to Exhibit 10.4 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 6, 2021)
10.14+
Immix Biopharma, Inc. Amended and Restated 2021 Omnibus Equity Incentive Plan (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on June 14, 2024 and incorporated herein by reference)
10.15
Form of Share Purchase Agreement (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on January 18, 2023)
10.16+
Amendment to Employment Agreement by and between the Company and Ilya Rachman dated as of May 12, 2023(filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 12, 2023 and incorporated herein by reference)
79
10.17+
Amendment to Master Services Agreement by and between the Company and Alwaysraise, LLC dated as of May 12, 2023(filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 12, 2023 and incorporated herein by reference)
14.1
Code of Business Conduct and Ethics (Incorporated by reference to Exhibit 14.1 to the Company’s Annual Report on Form 10-K filed with the SEC on March 24, 2022)
16.1
Letter from KMJ Corbin & Company LLP dated July 19, 2024 (filed as Exhibit 16.1 to the Company’s Current Report on Form 8-K filed with the SEC on June 19, 2024 and incorporated herein by reference)
19.1*
Insider
Trading Policy
21.1*
Subsidiaries
23.1*
Consent of Crowe LLP, independent registered public accounting firm
23.2*
Consent of KMJ Corbin & Company LLP, independent registered public accounting firm
31.1*
Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**
Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002
99.7
Immix Biopharma, Inc. Executive Clawback Policy (Incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on November 13, 2023)
101.INS*
Inline XBRL Instance Document
101.SCH*
Inline XBRL Taxonomy Extension Schema Document
101.CAL*
Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*
Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*
Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF*
Inline XBRL Taxonomy Extension Definition Linkbase Document
104*
Cover Page Interactive Data File – the cover page of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2023 is formatted in Inline XBRL
*
Filed
herewith.
**
Furnished
herewith.
+
Management
contract or compensatory plan or arrangement.
#
Pursuant
to Item 601(b)(10) of Regulation S-K, certain confidential portions of this exhibit were omitted by means of marking such portions
with an asterisk because the Company customarily and actually treats such information as private or confidential and such omitted
information is not material.
ITEM
16. FORM 10-K SUMMARY
None.
80
SIGNATURES
Pursuant
to the requirements of Section 13 and 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report
on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized on this 24 th day of March, 2025.
/s/
Ilya Rachman
Ilya
Rachman
Chief
Executive Officer
(Principal
Executive Officer)
Pursuant
to the requirements of the Securities Act of 1934, this Annual Report on Form 10-K has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates indicated.
Signature
Title
Date
/s/
Ilya Rachman
Chief
Executive Officer (Principal Executive Officer) and Chairman of the Board of Directors
March
24, 2025
Ilya
Rachman
/s/
Gabriel Morris
Chief
Financial Officer and Director
March
24, 2025
Gabriel
Morris
(Principal
Financial and Accounting Officer)
/ s/
Jason Hsu
Director
March
24, 2025
Jason
Hsu
/s/
Magda Marquet
Director
March
24, 2025
Magda
Marquet
/s/
Helen C. Adams
Director
March
24, 2025
Helen
C. Adams
/s/
Carey Ng
Director
March
24, 2025
Carey
Ng
/s/
Jane Buchan
Director
March
24, 2025
Jane
Buchan
/s/
Yekaterina Chudnovsky
Director
March
24, 2025
Yekaterina
Chudnovsky
81