x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 27-1967997 | |||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||||
Class A Common Stock, | The NASDAQ Stock Market LLC |
Large accelerated filer | o | Accelerated filer | ||||||||||||||
Non-accelerated filer | x | Smaller reporting company | ||||||||||||||
Emerging growth company |
| ||||||||
Explanatory Note
In an effort to regain compliance with the listing rule of the Nasdaq Capital Market requiring that the bid price of Calyxt, Inc.’s common stock be $1.00 per share or higher (Bid Price Rule), Calyxt, Inc. effected a
Terms
When the terms “Cibus,” the “Company” or “its” are used in this report, unless the context otherwise requires, those terms are being used to refer to Cibus, Inc. (formerly Calyxt, Inc.) and its consolidated subsidiaries (i) excluding Cibus Global, LLC and its consolidated subsidiaries, prior to the completion of the Merger Transactions (as defined under the heading “Explanatory Note” below) and (ii) the combined entity, including Cibus Global, LLC and its consolidated subsidiaries, as of and following the consummation of the Merger Transactions. When the term “Legacy Calyxt” is used, it is being used to exclusively refer to Calyxt, Inc. prior to the Merger Transactions. When the term “Cibus Global” is used, it is being used to refer to Cibus Global, LLC, both prior to and after the completion of the Merger Transactions. When the term “Cellectis,” is used, it is being used to refer to Cellectis S.A. (socié(société anonyme)anonyme), the Company’s largest stockholdershareholder prior to the completion of the Merger Transactions.
When the term “Class A Common Stock” is used, it is being used, unless the context requires otherwise, to refer prior to the Merger Transactions to Legacy Calyxt’s common stock, par value $0.0001 per share (Legacy Common Stock) and following the former majority ownerMerger Transactions to the Class A Common Stock, $0.0001 par value per share (Class A Common Stock). Each share of its common stock.
Legacy Common Stock existing and outstanding immediately prior to the Merger Transactions remained outstanding as a share of Class A Common Stock without any conversion or exchange thereof.
-1-
improper handling of its product candidates during development; failures by third-party contractors; inaccurate demand forecasting or milestone and royalty payment projections; the effectiveness of commercialization efforts by commercial partners or licensees; disruptions to supply chains, including raw material inputs for its BioFactory; the impact of changes or increases in oversight and regulation; disputes or challenges regarding intellectual property; proliferation and continuous evolution of new technologies; management changes;strategic challenges; changes in macroeconomic and market conditions, including inflation, supply chain constraints, and rising interest rates; dislocations in the capital markets and challenges in accessing liquidity and the impact of such liquidity challenges on the Company’s ability to execute on its business plan; and other important factors discussed in Part I, Item 1A, “Risk Factors”Factors of its AnnualCibus, Inc.” filed as Exhibit 99.3 with the Company’s Current Report on Form 10-K/A for the year ended December 31, 2022,8-K, which was filed with the SEC on March 3,June 1, 2023, (its Annual Report)under the heading "Item 8.01 - Other Events - Supplemental Risk Factors" in the Company's Current Report on Form 8-K filed on October 18, 2023, and itsany additional “Risk Factors” identified in the Company’s other subsequent reports on Forms 10-Q and 8-K filed with the SEC, which should be considered an integral part of Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
-2-
September 30, 2023 | December 31, 2022 | ||||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 31,883 | $ | 3,427 | |||||||
Restricted cash | — | 99 | |||||||||
Accounts receivable | 560 | — | |||||||||
Prepaid expenses and other current assets | 2,029 | 606 | |||||||||
Total current assets | 34,472 | 4,132 | |||||||||
Property, plant, and equipment, net | 17,197 | 4,516 | |||||||||
Operating lease right-of-use assets | 22,935 | 13,615 | |||||||||
Intangible assets, net | 134,921 | 158 | |||||||||
Goodwill | 585,266 | — | |||||||||
Other non-current assets | 1,444 | — | |||||||||
Total assets | $ | 796,235 | $ | 22,421 | |||||||
Liabilities, redeemable noncontrolling interest, and stockholders’ equity | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | 6,281 | $ | 340 | |||||||
Accrued expenses | 5,092 | 173 | |||||||||
Accrued compensation | 3,704 | 107 | |||||||||
Due to related parties | — | 175 | |||||||||
Deferred revenue | 1,637 | 107 | |||||||||
Current portion of notes payable | 1,165 | — | |||||||||
Current portion of financing lease obligations | 235 | 97 | |||||||||
Current portion of operating lease obligations | 5,436 | 367 | |||||||||
Class A common stock warrants | 1,512 | 291 | |||||||||
Other current liabilities | 17 | 5 | |||||||||
Total current liabilities | 25,079 | 1,662 | |||||||||
Notes payable, net of current portion | 629 | — | |||||||||
Financing lease obligations, net of current portion | 102 | — | |||||||||
Operating lease obligations, net of current portion | 18,844 | 13,447 | |||||||||
Royalty liability - related parties | 157,113 | — | |||||||||
Other non-current liabilities | 1,974 | 79 | |||||||||
Total liabilities | 203,741 | 15,188 | |||||||||
Commitments and contingencies (See Note 10) | |||||||||||
Redeemable noncontrolling interest | 129,104 | — | |||||||||
Stockholders’ equity: | |||||||||||
Class A common stock, $0.0001 par value; 210,000,000 shares authorized; 17,656,831 shares issued and 16,659,996 shares outstanding as of September 30, 2023, and 275,000,000 shares authorized; 978,915 shares issued and 976,908 shares outstanding as of December 31, 2022 | 8 | 5 | |||||||||
Class B common stock, $0.0001 par value; 90,000,000 shares authorized; 4,642,636 shares issued and outstanding as of September 30, 2023, and no shares authorized; no shares issued and outstanding as of December 31, 2022 | — | — | |||||||||
Additional paid-in capital | 727,821 | 220,422 | |||||||||
Class A common stock in treasury, at cost; 32,660 shares as of September 30, 2023, and 2,007 shares as of December 31, 2022 | (1,785) | (1,043) | |||||||||
Accumulated deficit | (262,664) | (212,151) | |||||||||
Accumulated other comprehensive income | 10 | — | |||||||||
Total stockholders’ equity | 463,390 | 7,233 | |||||||||
Total liabilities, redeemable noncontrolling interest, and stockholders' equity | $ | 796,235 | $ | 22,421 |
March 31, 2023 | December 31, 2022 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 2,054 | $ | 3,427 | ||||
Restricted cash | — | 99 | ||||||
Prepaid expenses and other current assets | 529 | 606 | ||||||
Total current assets | 2,583 | 4,132 | ||||||
Land, buildings, and equipment | 4,104 | 4,516 | ||||||
Operating lease right-of-use | 13,493 | 13,615 | ||||||
Other non-current assets | 105 | 158 | ||||||
Total assets | $ | 20,285 | $ | 22,421 | ||||
Liabilities and stockholders’ equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 327 | $ | 340 | ||||
Accrued expenses | 1,052 | 173 | ||||||
Accrued compensation | 180 | 107 | ||||||
Due to related parties | 63 | 175 | ||||||
Current portion of financing lease obligations | — | 97 | ||||||
Common stock warrants | 1,110 | 291 | ||||||
Short-term debt | 1,000 | — | ||||||
Other current liabilities | 483 | 479 | ||||||
Total current liabilities | 4,215 | 1,662 | ||||||
Operating lease obligations | 13,342 | 13,447 | ||||||
Other non-current liabilities | 61 | 79 | ||||||
Total liabilities | 17,618 | 15,188 | ||||||
Stockholders’ equity: | ||||||||
Common stock, $0.0001 par value; 275,000,000 shares authorized; 4,983,104 shares issued and 4,973,088 shares outstanding as of March 31, 2023, and 4,894,497 shares issued and 4,884,481 shares outstanding as of December 31, 2022 | 5 | 5 | ||||||
Additional paid-in capital | 221,250 | 220,422 | ||||||
Common stock in treasury, at cost; 10,016 shares as of March 31, 2023, and December 31, 2022 | (1,043 | ) | (1,043 | ) | ||||
Accumulated deficit | (217,545 | ) | (212,151 | ) | ||||
Total stockholders’ equity | 2,667 | 7,233 | ||||||
Total liabilities and stockholders’ equity | $ | 20,285 | $ | 22,421 | ||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Revenue: | |||||||||||||||||||||||
Revenue | $ | 475 | $ | 42 | $ | 714 | $ | 115 | |||||||||||||||
Total revenue | 475 | 42 | 714 | 115 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Research and development | 17,521 | 3,016 | 28,159 | 9,207 | |||||||||||||||||||
Selling, general, and administrative | 8,751 | 3,229 | 22,126 | 9,965 | |||||||||||||||||||
Total operating expenses | 26,272 | 6,245 | 50,285 | 19,172 | |||||||||||||||||||
Loss from operations | (25,797) | (6,203) | (49,571) | (19,057) | |||||||||||||||||||
Royalty liability interest expense - related parties | (8,136) | — | (10,753) | — | |||||||||||||||||||
Other interest income (expense), net | 281 | (47) | 359 | (80) | |||||||||||||||||||
Non-operating income (expenses) | (876) | 300 | (466) | 5,083 | |||||||||||||||||||
Loss before income taxes | (34,528) | (5,950) | (60,431) | (14,054) | |||||||||||||||||||
Income taxes | — | — | — | — | |||||||||||||||||||
Net loss | $ | (34,528) | $ | (5,950) | $ | (60,431) | $ | (14,054) | |||||||||||||||
Net loss attributable to redeemable noncontrolling interest | (8,099) | — | (9,918) | — | |||||||||||||||||||
Net loss attributable to Cibus, Inc. | $ | (26,429) | $ | (5,950) | $ | (50,513) | $ | (14,054) | |||||||||||||||
Basic and diluted net loss per share of Class A common stock | $ | (1.59) | $ | (6.36) | $ | (6.33) | $ | (15.56) | |||||||||||||||
Weighted average shares of Class A common stock outstanding – basic and diluted | 16,641,127 | 935,702 | 7,979,132 | 903,476 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net loss | $ | (34,528) | $ | (5,950) | $ | (60,431) | $ | (14,054) | |||||||||||||||
Foreign currency translation adjustments | 15 | — | 13 | — | |||||||||||||||||||
Comprehensive loss | (34,513) | (5,950) | (60,418) | (14,054) | |||||||||||||||||||
Comprehensive loss attributable to redeemable noncontrolling interest | (8,096) | — | (9,915) | — | |||||||||||||||||||
Comprehensive loss attributable to Cibus, Inc. | $ | (26,417) | $ | (5,950) | $ | (50,503) | $ | (14,054) |
Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Revenue | $ | 42 | $ | 32 | ||||
Cost of goods sold | — | — | ||||||
Gross profit | 42 | 32 | ||||||
Operating expenses: | ||||||||
Research and development | 2,209 | 2,941 | ||||||
Selling, general, and administrative | 2,296 | 3,180 | ||||||
Total operating expenses | 4,505 | 6,121 | ||||||
Loss from operations | (4,463 | ) | (6,089 | ) | ||||
Interest, net | (21 | ) | (17 | ) | ||||
Non-operating income (expenses) | (910 | ) | 487 | |||||
Loss before income taxes | (5,394 | ) | (5,619 | ) | ||||
Income taxes | — | — | ||||||
Net loss | $ | (5,394 | ) | $ | (5,619 | ) | ||
Basic and diluted net loss per share | $ | (1.09 | ) | $ | (1.34 | ) | ||
Weighted average shares outstanding – basic and diluted | 4,940,693 | 4,202,011 | ||||||
Anti-dilutive stock options, restricted stock units, performance stock units, and common stock warrants | 1,826,029 | 1,627,637 | ||||||
Class A Common Stock | Class B Common Stock | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Three Months Ended September 30, 2023 | Redeemable Noncontrolling Interest | Shares | Amount | Shares | Amount | Additional Paid-In Capital | Shares in Treasury | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2023 | $ | 136,866 | 16,606,401 | $ | 8 | 4,642,636 | $ | — | $ | 722,327 | $ | (1,785) | $ | (236,235) | $ | (2) | $ | 484,313 | ||||||||||||||||||||||||||||||||||||||||||||
Net loss | (8,099) | — | — | — | — | — | — | (26,429) | — | (26,429) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | 5,828 | — | — | — | 5,828 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock and payment of minimum employee taxes withheld upon net share settlement of restricted stock units | — | 53,608 | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares withheld for net share settlement | — | (13) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Change in value of redeemable noncontrolling interest | 334 | (334) | (334) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | 3 | — | — | — | — | — | — | — | 12 | 12 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2023 | $ | 129,104 | 16,659,996 | $ | 8 | 4,642,636 | $ | — | $ | 727,821 | $ | (1,785) | $ | (262,664) | $ | 10 | $ | 463,390 |
Three Months Ended September 30, 2022 | Class A Shares Outstanding | Class A Common Stock | Additional Paid-In Capital | Shares in Treasury | Accumulated Deficit | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | 934,327 | $ | 5 | $ | 218,161 | $ | (1,043) | $ | (203,364) | $ | 13,759 | |||||||||||||||||||||||||||
Net loss | — | — | — | — | (5,950) | (5,950) | ||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | 1,035 | — | — | 1,035 | ||||||||||||||||||||||||||||||||
Issuance of Class A common stock and payment of minimum employee taxes withheld upon net share settlement of restricted stock units | 1,871 | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Balance at September 30, 2022 | 936,198 | $ | 5 | $ | 219,196 | $ | (1,043) | $ | (209,314) | $ | 8,844 |
Three Months Ended March 31, 2023 | Shares Outstanding | Common Stock | Additional Paid-In Capital | Shares in Treasury | Accumulated Deficit | Total Stockholders’ Equity | ||||||||||||||||||
Balance at December 31, 2022 | 4,884,481 | $ | 5 | $ | 220,422 | $ | (1,043 | ) | $ | (212,151 | ) | $ | 7,233 | |||||||||||
Net loss | — | — | — | — | (5,394 | ) | (5,394 | ) | ||||||||||||||||
Stock-based compensation | — | — | 828 | — | — | 828 | ||||||||||||||||||
Issuance of common stock from stock-based compensation awards | 88,607 | — | — | — | — | — | ||||||||||||||||||
Balance at March 31, 2023 | 4,973,088 | $ | 5 | $ | 221,250 | $ | (1,043 | ) | $ | (217,545 | ) | $ | 2,667 | |||||||||||
Three Months Ended March 31, 2022 | Shares Outstanding | Common Stock | Additional Paid-In Capital | Shares in Treasury | Accumulated Deficit | Total Stockholders’ Equity | ||||||||||||||||||
Balance at December 31, 2021 | 3,877,400 | $ | 4 | $ | 211,263 | $ | (1,043 | ) | $ | (196,092 | ) | $ | 14,132 | |||||||||||
Net loss | — | — | — | — | (5,619 | ) | (5,619 | ) | ||||||||||||||||
Stock-based compensation | — | — | 531 | — | — | 531 | ||||||||||||||||||
Issuance of common stock from stock-based compensation awards | 8,779 | — | — | — | — | — | ||||||||||||||||||
Issuance of common stock from ATM facility, net of offering expenses | — | — | (7 | ) | — | — | (7 | ) | ||||||||||||||||
Issuance of common stock and pre-funded warrants in registered offering, net of $0.5 million of offering costs | 388,000 | 1 | 5,051 | — | — | 5,052 | ||||||||||||||||||
Cumulative effect of adoption of lease accounting standard | — | — | — | — | 832 | 832 | ||||||||||||||||||
Balance at March 31, 2022 | 4,274,179 | $ | 5 | $ | 216,838 | $ | (1,043 | ) | $ | (200,879 | ) | $ | 14,921 | |||||||||||
Class A Common Stock | Class B Common Stock | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, 2023 | Redeemable Noncontrolling Interest | Shares | Amount | Shares | Amount | Additional Paid-In Capital | Shares in Treasury | Accumulated Deficit | Accumulated Other Comprehensive Income | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2022 | $ | — | 976,908 | $ | 5 | — | $ | — | $ | 220,422 | $ | (1,043) | $ | (212,151) | $ | — | $ | 7,233 | ||||||||||||||||||||||||||||||||||||||||||||
Net loss | (9,918) | — | — | — | — | — | — | (50,513) | — | (50,513) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | 11,670 | — | — | — | 11,670 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock resulting from merger with Cibus Global, LLC | — | 15,508,202 | 3 | 4,642,636 | — | 634,748 | — | — | — | 634,751 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock and payment of minimum employee taxes withheld upon net share settlement of restricted stock units | — | 207,546 | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares withheld for net share settlement | — | (32,660) | — | — | — | — | (742) | — | — | (742) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Redeemable noncontrolling interest resulting from merger with Cibus Global, LLC | 138,685 | — | — | — | — | (138,685) | — | — | — | (138,685) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Change in value of redeemable noncontrolling interest | 334 | (334) | (334) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | 3 | — | — | — | — | — | — | — | 10 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2023 | $ | 129,104 | 16,659,996 | $ | 8 | 4,642,636 | $ | — | $ | 727,821 | $ | (1,785) | $ | (262,664) | $ | 10 | $ | 463,390 |
Nine Months Ended September 30, 2022 | Class A Shares Outstanding | Class A Common Stock | Additional Paid-In Capital | Shares in Treasury | Accumulated Deficit | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | 775,480 | $ | 4 | $ | 211,263 | $ | (1,043) | $ | (196,092) | $ | 14,132 | |||||||||||||||||||||||||||
Net loss | — | — | — | — | (14,054) | (14,054) | ||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | 2,890 | — | — | 2,890 | ||||||||||||||||||||||||||||||||
Issuance of Class A common stock and payment of minimum employee taxes withheld upon net share settlement of restricted stock units | 5,518 | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Issuance of Class A common stock from ATM facility, net of offering expenses | — | — | (7) | — | — | (7) | ||||||||||||||||||||||||||||||||
Issuance of Class A common stock and pre-funded warrants in registered offering, net of $0.5 million of offering costs | 77,600 | 1 | 5,050 | — | — | 5,051 | ||||||||||||||||||||||||||||||||
Issuance of Class A common stock upon exercise of pre-funded warrants | 77,600 | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Cumulative effect of adoption of lease accounting standard | — | — | — | — | 832 | 832 | ||||||||||||||||||||||||||||||||
Balance at September 30, 2022 | 936,198 | $ | 5 | $ | 219,196 | $ | (1,043) | $ | (209,314) | $ | 8,844 |
Nine Months Ended September 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
Operating activities | ||||||||||||||
Net loss | $ | (60,431) | $ | (14,054) | ||||||||||
Adjustments to reconcile net loss to net cash used by operating activities: | ||||||||||||||
Royalty liability interest expense - related parties | 10,753 | — | ||||||||||||
Depreciation and amortization | 2,875 | 1,158 | ||||||||||||
Stock-based compensation | 11,670 | 2,890 | ||||||||||||
Change in fair value of liability classified Class A common stock warrants | 1,221 | (5,009) | ||||||||||||
Other | 17 | — | ||||||||||||
Changes in operating assets and liabilities, net of acquisitions: | ||||||||||||||
Accounts receivable | 1,674 | — | ||||||||||||
Due to/from related parties | (95) | (34) | ||||||||||||
Prepaid expenses and other current assets | 1,111 | 297 | ||||||||||||
Accounts payable | (61) | (188) | ||||||||||||
Accrued expenses | 1,357 | 41 | ||||||||||||
Accrued compensation | 738 | (166) | ||||||||||||
Deferred revenues | 340 | (115) | ||||||||||||
Right-of-use assets and lease liabilities, net | (28) | 154 | ||||||||||||
Other assets and liabilities, net | (334) | (575) | ||||||||||||
Net cash used by operating activities | (29,193) | (15,601) | ||||||||||||
Investing activities | ||||||||||||||
Cash acquired from merger with Cibus Global, LLC | 59,381 | — | ||||||||||||
Purchases of property, plant, and equipment | (3,872) | (1,509) | ||||||||||||
Net cash provided by (used) by investing activities | 55,509 | (1,509) | ||||||||||||
Financing activities | ||||||||||||||
Proceeds from Class A common stock issuance | — | 11,209 | ||||||||||||
Costs incurred related to the issuance of Class A common stock | — | (962) | ||||||||||||
Proceeds from draws on revolving line of credit from Cibus Global, LLC | 2,500 | — | ||||||||||||
Payment of taxes related to vested restricted stock units | (742) | — | ||||||||||||
Proceeds from issuance of notes payable | 1,287 | — | ||||||||||||
Repayments of financing lease obligations | (242) | (353) | ||||||||||||
Repayments of notes payable | (760) | — | ||||||||||||
Net cash provided by financing activities | 2,043 | 9,894 | ||||||||||||
Effect of exchange rate changes on cash and cash equivalents | (2) | — | ||||||||||||
Net increase (decrease) in cash, cash equivalents, and restricted cash | 28,357 | (7,216) | ||||||||||||
Cash, cash equivalents, and restricted cash – beginning of period | 3,526 | 14,421 | ||||||||||||
Cash, cash equivalents, and restricted cash – end of period | $ | 31,883 | $ | 7,205 |
Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Operating activities | ||||||||
Net loss | $ | (5,394 | ) | $ | (5,619 | ) | ||
Adjustments to reconcile net loss to net cash used by operating activities: | ||||||||
Depreciation and amortization | 486 | 370 | ||||||
Stock-based compensation | 828 | 531 | ||||||
Unrealized (gain) loss on mark-to-market | 819 | (435 | ) | |||||
Changes in operating assets and liabilities: | ||||||||
Due to/from related parties | (112 | ) | (108 | ) | ||||
Prepaid expenses and other current assets | 56 | (110 | ) | |||||
Accounts payable | (13 | ) | (145 | ) | ||||
Accrued expenses | 879 | 37 | ||||||
Accrued compensation | 73 | (313 | ) | |||||
Other | 3 | (612 | ) | |||||
Net cash used by operating activities | (2,375 | ) | (6,404 | ) | ||||
Investing activities | ||||||||
Purchases of land, buildings, and equipment | — | (545 | ) | |||||
Net cash used by investing activities | — | (545 | ) | |||||
Financing activities | ||||||||
Proceeds from the issuance of common stock and pre-funded warrants | — | 11,209 | ||||||
Costs incurred related to the issuance of common stock and pre-funded warrants | — | (704 | ) | |||||
Proceeds from interim funding provided by Cibus Global, LLC | 1,000 | — | ||||||
Repayments of financing lease obligations | (97 | ) | (94 | ) | ||||
Net cash provided by financing activities | 903 | 10,411 | ||||||
Net (decrease) increase in cash, cash equivalents, and restricted cash | (1,472 | ) | 3,462 | |||||
Cash, cash equivalents, and restricted cash – beginning of period | 3,526 | 14,421 | ||||||
Cash, cash equivalents, and restricted cash – end of period | $ | 2,054 | $ | 17,883 | ||||
Class A Common Stock | Class B Common Stock | Total Common Stock | ||||||||||||||||||
Authorized | 210,000,000 | 90,000,000 | 300,000,000 | |||||||||||||||||
Issued | 17,656,831 | 4,642,636 | 22,299,467 | |||||||||||||||||
Outstanding | 16,659,996 | 4,642,636 | 21,302,632 |
In Thousands | Deferred Revenue | |||||||
Balance as of December 31, 2022 | $ | 107 | ||||||
Acquired from merger with Cibus Global, LLC | 1,186 | |||||||
Consideration earned | (714) | |||||||
Consideration received | 1,058 | |||||||
Balance as of September 30, 2023 | $ | 1,637 |
As of September 30, | |||||||||||
2023 | 2022 | ||||||||||
Stock options outstanding | 109,551 | 116,936 | |||||||||
Unvested restricted stock units | 198,199 | 25,210 | |||||||||
Unvested performance stock units | — | 22,600 | |||||||||
Unvested restricted stock awards | 945,780 | — | |||||||||
Common Warrants | 158,483 | 158,483 | |||||||||
Total | 1,412,013 | 323,229 |
Number of shares of Common Stock received by Cibus Global, LLC equityholders as merger consideration (1) | 20,150,838 | |||||||
Multiplied by the fair value per share of Cibus, Inc. Class A Common Stock (2) | $ | 31.50 | ||||||
Purchase price | $ | 634,751,397 |
In Thousands | May 31, 2023 | |||||||
Cash and cash equivalents | $ | 59,381 | ||||||
Accounts receivable | 2,216 | |||||||
Due from related parties, net | 19 | |||||||
Note receivable | 2,500 | |||||||
Prepaid expenses and other current assets | 2,535 | |||||||
Property, plant and equipment | 10,588 | |||||||
Operating lease right-of-use-assets | 9,519 | |||||||
Goodwill | 585,266 | |||||||
Intangible assets | 135,429 | |||||||
Other non-current assets | 457 | |||||||
Accounts payable | (5,582) | |||||||
Accrued expenses | (3,477) | |||||||
Accrued compensation | (2,859) | |||||||
Due to related parties | (8) | |||||||
Deferred revenue | (1,186) | |||||||
Current portion of notes payable | (517) | |||||||
Current portion of operating lease obligations | (4,687) | |||||||
Current portion of financing lease obligations | (165) | |||||||
Other current liabilities | (17) | |||||||
Notes payable, net of current portion | (749) | |||||||
Operating lease obligations, net of current portion | (6,006) | |||||||
Financing lease obligations, net of current portion | (10) | |||||||
Royalty liability - related parties | (146,360) | |||||||
Other non-current liabilities | (1,536) | |||||||
Consideration transferred | $ | 634,751 |
In Thousands, except useful life | May 31, 2023 | Estimated Average Useful Life (Years) | ||||||||||||
In-process research and development | $ | 99,051 | Indefinite | |||||||||||
Developed technology | 14,148 | 20 | ||||||||||||
Trade name | 22,230 | 20 | ||||||||||||
Total | $ | 135,429 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
Unaudited and in Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Pro forma revenues | $ | 475 | $ | 307 | $ | 1,154 | $ | 992 | ||||||||||||||||||
Pro forma net loss | (34,528) | (20,365) | (88,474) | (61,603) | ||||||||||||||||||||||
Pro forma net loss attributable to controlling interest | (24,575) | (17,301) | (70,855) | (53,178) | ||||||||||||||||||||||
Pro forma net loss attributable to redeemable noncontrolling interest | $ | (9,953) | $ | (3,064) | $ | (17,619) | $ | (8,425) |
March 31, 2023 | March 31, 2023 | |||||||||||||||||||||||||||||||
Fair Values of Assets | Fair Values of Liabilities | |||||||||||||||||||||||||||||||
In Thousands | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||
Other items reported at fair value: | ||||||||||||||||||||||||||||||||
Common stock warrants | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 1,110 | $ | 1,110 | ||||||||||||||||
Total | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 1,110 | $ | 1,110 | ||||||||||||||||
December 31, 2022 | December 31, 2022 | September 30, 2023 | December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Values of Assets | Fair Values of Liabilities | Fair Value of Assets | Fair Value of Assets | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
In Thousands | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | In Thousands | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other items reported at fair value: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common stock warrants | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 291 | $ | 291 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Money market funds (1) | Money market funds (1) | $ | 7,389 | $ | — | $ | — | $ | 7,389 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 291 | $ | 291 | Total | $ | 7,389 | $ | — | $ | — | $ | 7,389 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||||||||||||||||||||
September 30, 2023 | December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Liabilities | Fair Value of Liabilities | |||||||||||||||||||||||||||||||||||||||||||||||||
In Thousands | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||||||||||||||||
Common Warrants | $ | — | $ | — | $ | 1,512 | $ | 1,512 | $ | — | $ | — | $ | 291 | $ | 291 | ||||||||||||||||||||||||||||||||||
Total | $ | — | $ | — | $ | 1,512 | $ | 1,512 | $ | — | $ | — | $ | 291 | $ | 291 |
Level 3 Fair Value of Liabilities | ||||||||
Balance as of December 31, 2022 | 291 | |||||||
Mark to market adjustment | 1,221 | |||||||
Balance as of September 30, 2023 | 1,512 |
As of September 30, 2023 | As of December 31, 2022 | ||||||||||
Estimated fair value of Common Warrants | $ | 9.54 | $ | 1.87 | |||||||
Assumptions: | |||||||||||
Risk-free interest rate | 4.7 | % | 4.0 | % | |||||||
Expected volatility | 107.1 | % | 85.0 | % | |||||||
Expected term to liquidation (in years) | 3.9 | 4.6 |
As of March 31, | As of December 31, | |||||||
2023 | 2022 | |||||||
Estimated fair value of Common Warrants | $ | 1.43 | $ | 0.37 | ||||
Assumptions: | ||||||||
Risk-free interest rate | 3.8 | % | 4.0 | % | ||||
Expected volatility | 90.0 | % | 85.0 | % | ||||
Expected term to liquidation (in years) | 4.4 | 4.6 |
In Thousands, except useful life | Useful Life (Years) | As of September 30, 2023 | As of December 31, 2022 | |||||||||||||||||
Property, plant, and equipment, net: | ||||||||||||||||||||
Buildings | 10 - 20 | $ | 900 | $ | 900 | |||||||||||||||
Leasehold improvements | shorter of lease term or - 15 | 3,879 | 364 | |||||||||||||||||
Office furniture and equipment | 5 - 10 | 13,570 | 7,803 | |||||||||||||||||
Office furniture and equipment under financing leases | 4 - 20 | 373 | 414 | |||||||||||||||||
Computer equipment and software | 3 - 5 | 3,264 | 912 | |||||||||||||||||
Assets in progress | N/A | 3,272 | — | |||||||||||||||||
Total property, plant, and equipment | 25,258 | 10,393 | ||||||||||||||||||
Less accumulated depreciation and amortization | (8,061) | (5,877) | ||||||||||||||||||
Total | $ | 17,197 | $ | 4,516 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Depreciation and amortization expense | $ | 1,225 | $ | 369 | $ | 2,208 | $ | 1,091 |
In Thousands | Asset Retirement Obligations | |||||||
Balance as of December 31, 2022 | $ | — | ||||||
Acquired from merger with Cibus Global, LLC | 264 | |||||||
Obligations incurred | — | |||||||
Accretion expense | 5 | |||||||
Balance as of September 30, 2023 | $ | 269 |
In Thousands | Gross Carrying Amount | Accumulated Amortization | Intangible Assets, Net | |||||||||||||||||
In-process research and development | $ | 99,051 | $ | — | $ | 99,051 | ||||||||||||||
Developed technology | 14,148 | 236 | 13,912 | |||||||||||||||||
Trade name | 22,230 | 370 | 21,860 | |||||||||||||||||
Other | 150 | 52 | 98 | |||||||||||||||||
Total | $ | 135,579 | $ | 658 | $ | 134,921 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Amortization expense | $ | 459 | $ | 5 | 667 | 16 |
In Thousands | Amortization Expense | |||||||
Remainder of 2023 | $ | 458 | ||||||
2024 | 1,833 | |||||||
2025 | 1,833 | |||||||
2026 | 1,833 | |||||||
2027 | 1,833 | |||||||
2028 | 1,833 |
In Thousands | Annual Licenses | Financed Equipment | Insurance | Total Notes Payable | ||||||||||||||||||||||
Remainder of 2023 | $ | 93 | $ | 137 | $ | 290 | $ | 520 | ||||||||||||||||||
2024 | 216 | 450 | 194 | 860 | ||||||||||||||||||||||
2025 | — | 351 | — | 351 | ||||||||||||||||||||||
2026 | — | 151 | — | 151 | ||||||||||||||||||||||
2027 | — | 89 | — | 89 | ||||||||||||||||||||||
2028 | — | 15 | — | 15 | ||||||||||||||||||||||
309 | 1,193 | 484 | 1,986 | |||||||||||||||||||||||
Less: interest | (15) | (168) | (9) | (192) | ||||||||||||||||||||||
Total | $ | 294 | $ | 1,025 | $ | 475 | $ | 1,794 | ||||||||||||||||||
Current portion | 294 | 396 | 475 | 1,165 | ||||||||||||||||||||||
Noncurrent portion | $ | — | $ | 629 | $ | — | $ | 629 |
Common Warrants | Weighted Average Exercise Price Per Share | |||||||||||||
Outstanding as of December 31, 2022 | 158,483 | $ | 69.04 | |||||||||||
Issued | — | — | ||||||||||||
Forfeited/canceled | — | — | ||||||||||||
Exercised | — | — | ||||||||||||
Outstanding as of September 30, 2023 | 158,483 | $ | 69.04 | |||||||||||
Exercisable as of September 30, 2023 | 158,483 | $ | 69.04 |
Number of Common Stock Warrant Units Outstanding | Weighted-Average Exercise Price Per Share | |||||||
Outstanding as of December 31, 2022: | 776,000 | $ | 14.10 | |||||
Issued | — | — | ||||||
Forfeited/canceled | — | — | ||||||
Exercised | — | |||||||
Outstanding as of March 31, 2023: | 776,000 | $ | 14.10 | |||||
Exercisable as of March 31, 2023: | 776,000 | $ | 14.10 | |||||
Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Estimated fair values of stock options granted | $ | — | $ | 9.71 | ||||
Assumptions: | ||||||||
Risk-free interest rate | — | 1.9% - 2.4 | % | |||||
Expected volatility | — | 89.7% - 91.8 | % | |||||
Expected term (in years) | — | 5.75 - 6.89 | ||||||
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Estimated fair values of stock options granted | $ | — | $ | 42.83 | |||||||
Assumptions: | |||||||||||
Risk-free interest rate | —% | 1.9% - 3.5% | |||||||||
Expected volatility | —% | 89.7% - 92.8% | |||||||||
Expected term (in years) | — | 5.50 - 6.89 |
Options Exercisable | Weighted Average Exercise Price Per Share | Options Outstanding | Weighted Average Exercise Price Per Share | ||||||||||||||||||||
Balance as of December 31, 2022 | 67,978 | $ | 496.83 | 116,860 | $ | 367.58 | |||||||||||||||||
Granted | — | — | — | — | |||||||||||||||||||
Vested | 42,195 | 154.28 | — | — | |||||||||||||||||||
Exercised | — | — | — | — | |||||||||||||||||||
Forfeited or expired | (1,530) | 441.63 | (7,309) | 369.43 | |||||||||||||||||||
Balance as of September 30, 2023 | 108,643 | $ | 364.57 | 109,551 | $ | 367.46 |
Options Exercisable | Weighted- Average Exercise Price Per Share | Options Outstanding | Weighted- Average Exercise Price Per Share | |||||||||||||
Balance as of December 31, 2022 | 339,707 | $ | 99.35 | 584,171 | $ | 73.51 | ||||||||||
Granted | — | — | ||||||||||||||
Exercised | — | — | ||||||||||||||
Forfeited or expired | (21,206 | ) | 38.12 | |||||||||||||
Balance as of March 31, 2023 | 381,873 | $ | 92.18 | 562,965 | $ | 74.85 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Stock-based compensation expense | $ | 40 | $ | 530 | $ | 1,835 | $ | 1,420 |
Three Months Ended March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Stock-based compensation expense | $ | 354 | $ | 180 | ||||
Three Months Ended March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Net cash proceeds | $ | — | $ | — | ||||
Intrinsic value of options exercised | $ | — | $ | — | ||||
Restricted Stock Awards | Weighted Average Grant Date Fair Value | ||||||||||
Unvested balance as of December 31, 2022 | — | $ | — | ||||||||
Granted | 1,019,282 | 31.50 | |||||||||
Vested | (71,969) | 31.50 | |||||||||
Forfeited | (1,533) | 31.50 | |||||||||
Unvested balance as of September 30, 2023 | 945,780 | $ | 31.50 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Grant-date fair value | $ | 1,725 | $ | — | $ | 2,267 | $ | — |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Stock-based compensation expense | $ | 5,631 | $ | — | $ | 7,555 | $ | — |
Restricted Stock Units | Weighted Average Grant Date Fair Value | ||||||||||
Unvested balance as of December 31, 2022 | 24,575 | $ | 99.36 | ||||||||
Granted | 272,885 | 19.02 | |||||||||
Vested | (96,730) | 38.27 | |||||||||
Forfeited | (2,531) | 127.84 | |||||||||
Unvested balance as of September 30, 2023 | 198,199 | $ | 18.19 |
Number of Restricted Stock Units Outstanding | Weighted- Average Grant Date Fair Value | |||||||
Unvested balance as of December 31, 2022 | 122,914 | $ | 19.90 | |||||
Granted | 348,759 | 4.34 | ||||||
Vested | (68,831 | ) | 15.33 | |||||
Forfeited | (9,442 | ) | 17.24 | |||||
Unvested balance as of March 31, 2023 | 393,400 | $ | 6.97 | |||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Grant-date fair value | $ | 100 | $ | 530 | $ | 3,702 | $ | 1,686 |
Three Months Ended March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Grant-date fair value | $ | 1,055 | $ | 617 | ||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Stock-based compensation expense | $ | 157 | $ | 334 | $ | 2,550 | $ | 992 |
Three Months Ended March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Stock-based compensation expense | $ | 311 | $ | 205 | ||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Deemed dividends from grants to Cellectis employees | $ | — | $ | 18 | $ | — | $ | 82 |
Three Months Ended March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Deemed dividends from grants to Cellectis employees | $ | — | $ | 37 | ||||
22,600 | ||||||||
24,800 | ||||||||
— |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Stock-based compensation (benefit) expense | $ | — | $ | 171 | $ | (270) | $ | 478 |
Three Months Ended March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Stock-based compensation expense | $ | 163 | $ | 146 | ||||
As of September 30, 2023 | As of December 31, 2022 | |||||||||||||||||||||||||
In Thousands, except remaining term | Remaining Term (years) | Right-of-Use-Asset | Remaining Term (years) | Right-of-Use-Asset | ||||||||||||||||||||||
Roseville, Minnesota lease | 14.6 | $ | 13,244 | 15.3 | $ | 13,613 | ||||||||||||||||||||
San Diego, California laboratory lease | 1.9 | 3,848 | — | — | ||||||||||||||||||||||
San Diego, California headquarters lease | 1.7 | 3,710 | — | — | ||||||||||||||||||||||
San Diego, California greenhouse lease | 4.9 | 1,541 | — | — | ||||||||||||||||||||||
Other leases | < 1.0 - 3.0 | 592 | < 1.0 | 2 | ||||||||||||||||||||||
Total | $ | 22,935 | $ | 13,615 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Finance lease costs | $ | 65 | $ | 57 | $ | 79 | $ | 73 | ||||||||||||||||||
Operating lease costs | 1,635 | 381 | 2,830 | 1,174 | ||||||||||||||||||||||
Total | $ | 1,700 | $ | 438 | $ | 2,909 | $ | 1,247 |
Three Months Ended March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Finance lease costs | $ | 3 | $ | 9 | ||||
Operating lease costs | 388 | 399 | ||||||
Variable lease costs | 233 | 231 | ||||||
Total | $ | 624 | $ | 639 | ||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands, except for lease term and discount rate | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||||||||||||||||||||||||
Operating cash flows (operating leases) | $ | 1,297 | $ | 70 | $ | 1,848 | $ | 205 | ||||||||||||||||||
Financing cash flows (finance leases) | $ | 132 | $ | 163 | $ | 242 | $ | 353 |
Three Months Ended March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||||||
Operating cash flows (operating leases) | $ | 72 | $ | 67 | ||||
Financing cash flows (finance leases) | 97 | 94 |
As of September 30, 2023 | As of December 31, 2022 | |||||||||||||||||||||||||
Operating | Financing | Operating | Financing | |||||||||||||||||||||||
Weighted average remaining lease term (years) | 10.5 | 1.4 | 15.3 | 0.4 | ||||||||||||||||||||||
Weighted average discount rate | 7.5 | % | 9.5 | % | 7.9 | % | 8.1 | % |
As of March 31, 2023 | As of December 31, 2022 | |||||||||||||||
Operating | Financing | Operating | Financing | |||||||||||||
Weighted average remaining lease term (years) | 15.1 | — | 15.3 | 0.4 | ||||||||||||
Weighted average discount rate | 7.9 | % | — | 7.9 | % | 8.1 | % |
In Thousands | Operating | Financing | Total | |||||||||||||||||
Remainder of 2023 | $ | 1,758 | $ | 40 | $ | 1,798 | ||||||||||||||
2024 | 7,132 | 210 | 7,342 | |||||||||||||||||
2025 | 4,797 | 120 | 4,917 | |||||||||||||||||
2026 | 1,993 | — | 1,993 | |||||||||||||||||
2027 | 1,920 | — | 1,920 | |||||||||||||||||
2028 | 1,863 | — | 1,863 | |||||||||||||||||
Thereafter | 15,438 | — | 15,438 | |||||||||||||||||
34,901 | 370 | 35,271 | ||||||||||||||||||
Less: interest | (10,621) | (33) | (10,654) | |||||||||||||||||
Total | $ | 24,280 | $ | 337 | $ | 24,617 | ||||||||||||||
Current portion | 5,436 | 235 | 5,671 | |||||||||||||||||
Noncurrent portion | $ | 18,844 | $ | 102 | $ | 18,946 |
In Thousands | Operating | Financing | Total | |||||||||
Remainder of 2023 | $ | 1,102 | $ | — | $ | 1,102 | ||||||
2024 | 1,480 | — | 1,480 | |||||||||
2025 | 1,479 | — | 1,479 | |||||||||
2026 | 1,479 | — | 1,479 | |||||||||
2027 | 1,479 | — | 1,479 | |||||||||
2028 | 1,553 | — | 1,553 | |||||||||
Thereafter | 15,438 | — | 15,438 | |||||||||
24,010 | — | 24,010 | ||||||||||
Less: imputed interest | (10,268 | ) | — | (10,268 | ) | |||||||
Total | $ | 13,742 | $ | — | $ | 13,742 | ||||||
In Thousands | Royalty Liability - Related Parties | |||||||
Balance as of December 31, 2022 | $ | — | ||||||
Acquired from merger with Cibus Global, LLC | 146,360 | |||||||
Interest expense recognized | 10,753 | |||||||
Balance as of September 30, 2023 | $ | 157,113 |
In Thousands | As of September 30, 2023 | As of December 31, 2022 | ||||||||||||
Accrued Expenses: | ||||||||||||||
Accrued consulting and professional fees | $ | 2,980 | $ | 119 | ||||||||||
Accrued field trials | 1,716 | — | ||||||||||||
Other | 396 | 54 | ||||||||||||
Total | $ | 5,092 | $ | 173 |
In Thousands | As of March 31, 2023 | As of December 31, 2022 | ||||||
Cash, cash equivalents, and restricted cash: | ||||||||
Cash and cash equivalents | $ | 2,054 | $ | 3,427 | ||||
Restricted cash | — | 99 | ||||||
Total | $ | 2,054 | $ | 3,526 | ||||
In Thousands | As of March 31, 2023 | As of December 31, 2022 | ||||||
Prepaid expenses and other current assets: | ||||||||
Common warrants – financing costs | $ | 375 | $ | 396 | ||||
Prepaid expenses and other current assets | 154 | 210 | ||||||
Total | $ | 529 | $ | 606 | ||||
In Thousands | As of March 31, 2023 | As of December 31, 2022 | ||||||
Other current liabilities: | ||||||||
Operating lease obligations – current | $ | 400 | $ | 367 | ||||
Other current liabilities | 83 | 112 | ||||||
Total | $ | 483 | $ | 479 | ||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
In Thousands | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
Stock-based compensation expense: | ||||||||||||||||||||||||||
Research and development | $ | 2,853 | $ | 210 | $ | 5,531 | $ | 620 | ||||||||||||||||||
Selling, general, and administrative | 2,975 | 825 | 6,139 | 2,270 | ||||||||||||||||||||||
Total | $ | 5,828 | $ | 1,035 | $ | 11,670 | $ | 2,890 |
Three Months Ended March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Stock-based compensation expense: | ||||||||
Research and development | $ | 184 | $ | 30 | ||||
Selling, general, and administrative | 644 | 501 | ||||||
Total | $ | 828 | $ | 531 | ||||
Three Months Ended March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Interest, net: | ||||||||
Interest expense | $ | (3 | ) | $ | (10 | ) | ||
Interest income | 3 | 1 | ||||||
Common stock warrants - financing costs amortization | (21 | ) | (8 | ) | ||||
Total | $ | (21 | ) | $ | (17 | ) | ||
Nine Months Ended September 30, | ||||||||||||||
In Thousands | 2023 | 2022 | ||||||||||||
Interest paid | $ | 98 | $ | 67 |
As of March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Interest paid | $ | 3 | $ | 8 | ||||
Nine Months Ended September 30, | ||||||||||||||
In Thousands | 2023 | 2022 | ||||||||||||
Receivable from Jefferies for shares issued under ATM facility | $ | — | $ | (260) | ||||||||||
Property, plant, and equipment acquired through assuming liabilities | 419 | (687) | ||||||||||||
Shares issued for consideration in the merger with Cibus Global | 634,751 | — | ||||||||||||
Forgiveness of interim funding resulting from merger with Cibus Global | 2,500 | — | ||||||||||||
Cumulative effect of adoption of lease accounting standard on stockholders’ equity | — | 832 | ||||||||||||
Establishment of financing lease right-of-use assets and associated operating lease liabilities | 307 | — | ||||||||||||
Establishment of operating lease right-of-use assets and associated operating lease liabilities | $ | 1,606 | $ | 14,090 |
As of March 31, | ||||||||
In Thousands | 2023 | 2022 | ||||||
Receivable from Jefferies for shares issued under ATM facility | $ | — | $ | (260 | ) | |||
Non-cash additions to land, buildings, and equipment | $ | — | $ | (202 | ) | |||
Unpaid stock offering costs included in stockholders’ equity | $ | — | $ | 257 | ||||
Cumulative effect of adoption of lease accounting standard on stockholders’ equity | $ | — | $ | 832 | ||||
Establishment of operating lease right-of-use | $ | — | $ | 14,090 | ||||
EXECUTIVE OVERVIEW
CalyxtTrait Machine System (Trait Machine™). It is a plant-based synthetic biology company. The Company leverages its proprietary PlantSpring™ technology platformtime bound, reproducible, and predictable science-based breeding process. In addition, Legacy Calyxt has significant patented agricultural gene editing technologies including the exclusive rights to engineer plant metabolism to produce innovative, high-value, and sustainable materials and productsTALEN® for use in helpingplants.
both gene editing process and trait development aspects of this new industry.
Historically,On October 18, 2023, Cibus implemented a strategic realignment to align with its primary commercial objective of advancing its late-stage activities. In particular, Cibus is focusing its operations on completing the launch of its first three traits—PSR, HT1, and HT3—in its crop programs in canola, WOSR, and rice, enabling its soybean platform, and advancing its Sclerotinia resistance trait and HT2 trait in canola, WOSR, and soybean.
The Company believes that this refocusing on its strengths and highest priorities best positions it to meet its strategic objectives.
The strategic realignment resulted in a reduction in workforce in full time employees from 242 full-time employees as of October 17, 2023, to approximately 185 full-time employees. This reduction was intended to align the Company’s expenses in connection with the execution of its long-term business plan have been primarily driven by:
Research and Development (R&D) expenses associated with developing and enhancing the capabilities of its PlantSpring technology platform;
R&D expenses and capital expenditures to expand its BioFactory production system;
regulatory expenses associated with R&D and product development;
maintaining, protecting, expanding, and defending its intellectual property portfolio, including intellectual property related to the PlantSpring technology platform and BioFactory production system;
human capital related expenses associated with attractingresources to meet its commercial and retaining skilled personnel;strategic goals. The Company communicated the workforce reduction to affected employees on October 18, 2023, and
pursuing and negotiating agreements with customers, licensees, and infrastructure partners.
BUSINESS UPDATE
Merger Agreement and Interim Funding
On September 22, 2022, expects the Company announced that the Board had begun evaluating potential strategic alternatives to maximize shareholder value, including financing alternatives, merger, reverse merger, other business combinations, sale of assets, licensing, or other transactions.
On January 13, 2023, the Company, Cibus, and certain other parties thereto entered into the Merger Agreement. Pursuant to the Merger Agreement, following the Transactions, Calyxt will be organized in an “Up-C” structure and re-named “Cibus, Inc.”, Calyxt will act as the managing member of Cibus, and its only material asset will consist of common units of Cibus. If the Transactions are completed, the business of Cibus will continue as the primary business of the combined organization and the current equity holders of Cibus will own a substantial majority of the issued and outstanding common stockassociated costs to be incurred during the quarter ending December 31, 2023.
As part of the Company.
The closing of the Transactions is subject to the approval of Calyxt’s stockholders, the approval of Cibus’ members, the receipt of required regulatory approvals (to the extent applicable), and satisfaction of other customary closing conditions. The closing is currently expected to occur in the second quarter of 2023. Additional information regarding the Transactions is included in Calyxt’s registration statement on Form S-4 initially filed with the SEC on February 14, 2023, as amended on April 14, 2023.
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Pursuant to the Merger Agreement, beginning at the earlier of March 15, 2023, and the date Calyxt’s unrestricted cash balance first drops below $1.5 million, Calyxt could request, and Cibus agreed to provide, an unsecured, interest-free revolving line of credit of up to $3.0 million in cash, which amount may be increased to $4.0 million if Cibus elects to extend the outside date (as defined in the Merger Agreement) to June 30, 2023. Funds can be drawn by Calyxt in $0.5 million increments and may only be used to fund operating expenses incurred in the ordinary course of business consistent with past practice and consistent with the negative covenants in the Merger Agreement. The full outstanding balance of the Interim Funding will be reduced to zero in connection with the closing of the Transactions, if consummated. The full outstanding balance of the Interim Funding will be forgiven by Cibus if the Merger Agreement is terminated for any reason under certain conditions, as detailed in the Merger Agreement. The Interim Funding is subject to acceleration in connection with certain bankruptcy events. As of March 31, 2023, the Company had received $1.0 million of Interim Funding from Cibus. Subsequent to March 31, 2023, and prior to the filing date of this Form 10-Q, the Company received another $0.5 million of Interim Funding from Cibus.
If, for any reason, the Transactions are not completed, the Company will reconsider its available alternatives at such time and could pursue one of the following courses of action, which the Company currently believes to be the most likely alternatives:
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Current Operational Focus
Prior to the announcement of the Transactions, the Company’s primary focus was on the development of synthetic biology products for its customers using its BioFactory production system. In light of the proposed Transactions and recent capital resource constraints,strategic realignment, the Company has substantially scaled back its operations and has focused its current business activities on ensuring it has cash sufficient to achieve a closing of the proposed Transactions. Accordingly, Calyxt’s management has implementedalso initiated cost reduction and other cash-focused measures, including reductioninitiatives designed to preserve capital resources for the advancement of its priority objectives, which initiatives include reductions in capital expenditures, headcount reductions,streamlining of independent contractor utilization, and renegotiation or terminationprioritization of professional services agreements. To conserve cash, Calyxt has also strategically evaluated its arrangements with suppliers and service providers and has, in several instances, transitioned such relationships to lower cost alternative providers.
In limiting operations to core activities, the Company has focused its continuing operations on:
scaling production of a single Plant Cell Matrix with its manufacturing partner, Evologic;
licensing efforts with respect to its PlantSpring technology and plant traits, including the TALEN technology; and
continuing to progress its three current customer projects—(1) its research collaboration with a leading global food ingredient manufacturer to develop a soybean trait to serve as an alternative to palm oil, (2) its plant-based chemistry pilot project for a major consumer packaged goods company, and (3) supporting late-stage development activities for its improved digestibility alfalfa trait, which was developed with and licensed to S&W Seed Company.
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The Company has suspended non-core activities, such as efforts toward the development and integration of AIML and the initiation, development, and commercialization of additional synthetic biology products, or chemistries, beyond those involved in the continuing operations identified above.
RELATIONSHIP WITH CELLECTIS AND COMPARABILITY OF RESULTS
The Company’s
Cellectis has certain contractual rights as well as rights pursuant to Immediately following the Company’s certificate of incorporation and bylaws, in each case, for so long as it maintains threshold beneficial ownership levels in the Company’s shares. See “Risk Factors—Although Cellectis and its affiliates hold less than a majoritycompletion of the Company’s outstanding common stock,Merger Transactions, Cellectis possesses certain rightsreported in a Schedule 13D filing that prevent other stockholders from influencing significant decisions”it held 2.9 percent of the Company’s Annual Report on Form 10-K/Company's outstanding Class A for Common Stock and did not hold any of the year ended December 31, 2022.
In addition, Company's Class B Common Stock. Upon the completion of the Merger Transactions, Cellectis no longer possesses any contractual governance rights under the Company's Amended Certificate of Incorporation or bylaws.
Cellectis has guaranteed the lease agreement for the Company’s headquarters.Roseville, Minnesota facility. However, the Company previously agreed to indemnify Cellectis for any obligations under this guaranty, effective upon Cellectis’ ownership falling to 50 percent or less of the Company’s outstanding common stock. Accordingly, the Company’s indemnification obligation was triggered in October 2022.
FINANCIAL OPERATIONS OVERVIEWthe unaudited condensed consolidated financial statements.
Cost
Collaboration and research revenues are primarily related to revenues earned from performance obligations under collaboration arrangements. Pursuant to the terms of Goods Sold
Costthe collaboration agreements, the Company receives non-refundable payments for ongoing R&D activities, reimbursements of goods sold are recognized as products are sold. There are minimalR&D costs, and milestone payments upon the achievement of goods sold associatedcertain scientific, regulatory, or commercial milestones. Pursuant to the collaboration agreements, the Company also will receive royalty payments in connection with the Company’s technologysale of commercialized products containing the traits that are subject to those agreements.
agreements increasingly becoming its main source of future revenues.
Selling, General, and Administrative Expense
SG&A expenses consist primarily of employee-related expenses for selling and licensing the Company’s products and employee-related expenses for its executive, legal, intellectual property, information technology, finance, and human resources functions. Other SG&A expenses include facility and information technology expenses not otherwise allocated to R&D expenses, professional fees for auditing, tax and legal services, expensesrisks associated with maintaining patents, consulting coststhe Royalty Liability. See “Risk Factors—Risks Related to Cibus’ Organization and other costsOperation—Cibus’ Royalty Liability may contribute to net losses for Cibus and cause the value for securities of Cibus to fluctuate,” included in the Company’s information systems, and costs to market its products.
Closing 8-K.
Interest,
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Non-operating income (expenses) are income or expenses that are not directly related to ongoing operations and are primarily comprised of gains and losses from the mark-to-market of Common Warrants, gain from a legal settlement, costs related to the completion of the Transactions,and foreign exchange-related transactions, and disposals of land, buildings, and equipment.
transactions.
Revenues and Costs
To the extent any revenue is generated under the Company’s current business model, such revenue would derive from product development activities for customers for both the BioFactory production system and agricultural production and technology licensing arrangements. Any such cash and revenue- generating opportunities associated with these activities would be expectedPrior to primarily arise from up-front and milestone payments, annual license fees, and royalties. If, and when, the BioFactory begins to produce products for customers, it is anticipated that such revenues would grow and surpass revenues from other sources.
During the course of discussions with Cibus regarding, and following the execution of, the Merger Agreement,Transactions, Legacy Calyxt hasreduced employee headcount and streamlined and focused its business activities on preserving cash sufficient to achieve a closing of the Transactions. Accordingly, Calyxt has taken additional steps to streamline its operations and to reduce its operating expenses, while focusing on a limited scope of core projects. While these projects are important for Calyxt’s overall product development pipeline, noneSubsequent to the completion of these projects is expected to generate material revenue in the near term. WhileMerger Transactions, the Company continuously implemented cost reduction measures including not filling open positions throughout 2022,Company’s employee headcount increased as a result of the principal impactacquisition of these actions affects results of operations beginning in early 2023 following the reduction in employees from 48 to 28 in January 2023.Cibus Global. As of March 31,September 30, 2023, the Company had 25 full time236 employees.
Three Months Ended March 31, | ||||||||||||||||
2023 | 2022 | $ Change | % Change | |||||||||||||
(In thousands, except percentage values) | ||||||||||||||||
Revenue | $ | 42 | $ | 32 | $ | 10 | 31 | % | ||||||||
Cost of goods sold | — | — | — | 0 | % | |||||||||||
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Gross profit | 42 | 32 | 10 | 31 | % | |||||||||||
Research and development | 2,209 | 2,941 | (732 | ) | (25 | )% | ||||||||||
Selling, general, and administrative | 2,296 | 3,180 | (884 | ) | (28 | )% | ||||||||||
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Loss from operations | (4,463 | ) | (6,089 | ) | 1,626 | 27 | % | |||||||||
Interest, net | (21 | ) | (17 | ) | (4 | ) | (24 | )% | ||||||||
Non-operating income (expenses) | (910 | ) | 487 | (1,397 | ) | (287 | )% | |||||||||
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Net loss | $ | (5,394 | ) | $ | (5,619 | ) | $ | 225 | 4 | % | ||||||
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Basic and diluted net loss per share | $ | (1.09 | ) | $ | (1.34 | ) | $ | 0.25 | 19 | % | ||||||
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In Thousands, except per share and percentage values | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Revenue | $ | 475 | $ | 42 | $ | 433 | 1,031 | % | |||||||||||||||
Research and development | 17,521 | 3,016 | 14,505 | 481 | % | ||||||||||||||||||
Selling, general, and administrative | 8,751 | 3,229 | 5,522 | 171 | % | ||||||||||||||||||
Loss from operations | (25,797) | (6,203) | (19,594) | (316) | % | ||||||||||||||||||
Royalty liability interest expense - related parties | (8,136) | — | (8,136) | NM | |||||||||||||||||||
Other interest income (expense), net | 281 | (47) | 328 | 698 | % | ||||||||||||||||||
Non-operating income (expenses) | (876) | 300 | (1,176) | (392) | % | ||||||||||||||||||
Net loss | $ | (34,528) | $ | (5,950) | $ | (28,578) | (480) | % | |||||||||||||||
Net loss attributable to redeemable noncontrolling interest | (8,099) | — | (8,099) | NM | |||||||||||||||||||
Net loss attributable to Cibus, Inc. | $ | (26,429) | $ | (5,950) | $ | (20,479) | (344) | % | |||||||||||||||
Basic and diluted net loss per share of Class A common stock | $ | (1.59) | $ | (6.36) | $ | 4.77 | 75 | % |
Revenues and gross profit were nominal
Nine Months Ended September 30, | |||||||||||||||||||||||
In Thousands, except per share and percentage values | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Revenue | $ | 714 | $ | 115 | $ | 599 | 521 | % | |||||||||||||||
Research and development | 28,159 | 9,207 | 18,952 | 206 | % | ||||||||||||||||||
Selling, general, and administrative | 22,126 | 9,965 | 12,161 | 122 | % | ||||||||||||||||||
Loss from operations | (49,571) | (19,057) | (30,514) | (160) | % | ||||||||||||||||||
Royalty liability interest expense - related parties | (10,753) | — | (10,753) | NM | |||||||||||||||||||
Other interest income (expense), net | 359 | (80) | 439 | 549 | % | ||||||||||||||||||
Non-operating income (expenses) | (466) | 5,083 | (5,549) | (109) | % | ||||||||||||||||||
Net loss | $ | (60,431) | $ | (14,054) | $ | (46,377) | (330) | % | |||||||||||||||
Net loss attributable to redeemable noncontrolling interest | (9,918) | — | (9,918) | NM | |||||||||||||||||||
Net loss attributable to Cibus, Inc. | $ | (50,513) | $ | (14,054) | $ | (36,459) | (259) | % | |||||||||||||||
Basic and diluted net loss per share of Class A common stock | $ | (6.33) | $ | (15.56) | $ | 9.23 | 59 | % |
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Selling, General,facility costs, $3.8 million of stock compensation expense related to RSAs granted as part of the completion of the Merger Transactions, and Administrative Expense
SG&A expense was $2.3 million in the first quarter of 2023, a decrease of $0.9 million, or 28 percent, from the first quarter of 2022. The decrease was driven by the reduction in headcount year-over-year and other cost reduction initiatives.
Interest, net
Interest, net was nominal in the first quarter of 2023 and 2022. The increase in expense was driven by a full quarter of amortization of financing costs associated with the issuance of common stock warrants in the first quarter of 2023 compared to a partial quarter of amortization in the first quarter of 2022, partially offset by a lower financing lease obligations balance.
Non-operating income (expenses)
Non-operating income (expenses) were expense of $0.9 million in the first quarter of 2023, an increase in expense of $1.4 million, or 287 percent, from the first quarter of 2022. The increase in expense was driven by $1.3 million of mark-to-market loss onone-time stock compensation expense from accelerated share vesting per the Company’s Common Warrants, which increased in valueindividual stock award agreements due to an increase in stock price, as well as $0.8 millionthe completion of costs associated with the Merger Transactions. These expenses were partially offset by a $3.1 million decrease in Legacy Calyxt expenses due to lower headcount and cost reduction efforts in preparation for the Merger Transactions.
Net Loss Per Share
Net loss per share was $1.09 in the first quarter of 2023, an improvement of $0.25 per share, or 19 percent, from the first quarter of 2022. The improvement in net loss per share was driven by the improvement in net loss and a year-over-year increase in weighted average shares outstanding.
LIQUIDITY AND CAPITAL RESOURCES
Liquidity
The Company’s primary sourcessource of liquidity areis its cash and cash equivalents. equivalents, with additional capital resources accessible from the capital markets, subject to market conditions and other factors, including limitations that may apply to the Company under applicable SEC and Nasdaq regulations. In addition, on October 20, 2023, Cibus entered into a binding term sheet with Rory Riggs, the Company’s Chairman and Chief Executive Officer, which makes available to the Company, beginning January 1, 2024, a line of credit (the Loan) in the aggregate principal amount of $5.0 million. The Loan, which automatically terminates if the Company secures additional financing in the aggregate amount of $20.0 million prior to January 1, 2024, is intended to provide additional certainty with respect to the Company’s capital resources as it pursues additional debt and/or equity financing.
As of March 31,September 30, 2023, the Company had $2.1$31.9 million of cash and cash equivalents. Current liabilities were $4.2$25.1 million as of March 31,September 30, 2023.
The Company’s current cash and cash equivalents, when combined with Interim Funding available from Cibus, are sufficient to cover the Company’s current liabilities as of March 31, 2023. See above under the heading “Business Update—Merger Agreement and Interim Funding” for additional details regarding the Interim Funding.
The Company’s liquidity funds its non-discretionary cash requirements and its discretionary spending. The Company has contractual obligations related to recurring business operations, primarily related to lease payments for its headquarterscorporate and laboratory facilities. The Company’s principal discretionary cash spending is for salaries, capital expenditures, short-term working capital payments, and professional and other transaction-related expenses incurred as the Company pursues additional financing and evaluates potential alternative transactions.
financing.
Three Months Ended March 31, | ||||||||||||||||
In Thousands | 2023 | 2022 | $ Change | % Change | ||||||||||||
Net loss | $ | (5,394 | ) | $ | (5,619 | ) | $ | 225 | 4 | % | ||||||
Depreciation and amortization expenses | 486 | 370 | 116 | 31 | % | |||||||||||
Stock-based compensation | 828 | 531 | 297 | 56 | % | |||||||||||
Unrealized (gain) loss on mark-to-market of common stock warrants | 819 | (435 | ) | 1,254 | 288 | % | ||||||||||
Changes in operating assets and liabilities | 886 | (1,251 | ) | 2,137 | 171 | % | ||||||||||
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Net cash used by operating activities | $ | (2,375 | ) | $ | (6,404 | ) | $ | 4,029 | 63 | % | ||||||
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NM – not meaningful Nine Months Ended September 30, In Thousands, except percentage values 2023 2022 $ Change % Change Net loss $ (60,431) $ (14,054) $ (46,377) (330) % Royalty liability interest expense - related parties 10,753 — 10,753 NM Depreciation and amortization 2,875 1,158 1,717 148 % Stock-based compensation 11,670 2,890 8,780 304 % Change in fair value of liability classified Class A common stock warrants 1,221 (5,009) 6,230 124 % Other 17 — 17 NM Changes in operating assets and liabilities 4,702 (586) 5,288 902 % Net cash used by operating activities $ (29,193) $ (15,601) $ (13,592) (87) %
Net cash used by operating activities was $2.4$29.2 million in the first quarternine months of 2023, an improvementincrease in cash used of $4.0$13.6 million, or 6387 percent, from the first quarternine months of 2022. The improvement was driven by a $2.1 million decreaseincrease in cash used was primarily driven by operating liabilities, primarily related to severance and bonus payments made in the first quarter of 2022, a $1.3 million unrealized gain from thean increase in value of the Common Warrants, a $0.2 million decrease in net loss discussed above, and a $0.3 million increase in non-cash stock compensation, primarilyrelated to the result of higher forfeiture amounts of stock awardsoperations acquired in the first quarterMerger Transactions offset by an increase of 2022.
$5.3 million from the changes in operating assets and liabilities related to assets and liabilities assumed from the closing of the Merger Transactions with Cibus Global, LLC.
Nine Months Ended September 30, | ||||||||||||||||||||||||||
In Thousands, except percentage values | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Cash acquired from merger with Cibus Global, LLC | $ | 59,381 | $ | — | $ | 59,381 | NM | |||||||||||||||||||
Purchases of property, plant, and equipment | (3,872) | (1,509) | (2,363) | (157) | % | |||||||||||||||||||||
Net cash provided by (used) by investing activities | $ | 55,509 | $ | (1,509) | $ | 57,018 | 3,779 | % |
Cash Flows from Investing Activities
Three Months Ended March 31, | ||||||||||||||||
In Thousands | 2023 | 2022 | $ Change | % Change | ||||||||||||
Purchases of land, buildings, and equipment | — | (545 | ) | 545 | 100 | % | ||||||||||
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Net cash (used by) investing activities | $ | — | $ | (545 | ) | $ | 545 | 100 | % | |||||||
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There was no net cash provided or used by investing activities in the first quarter of 2023,acquired as a decrease in cash used by investing activities of $0.5 million, or 100 percent, from the first quarter of 2022. The decrease in cash used by investing activities used was driven by the decision to conserve cash and place capital projects on hold in anticipationresult of the completion of theMerger Transactions.
The Company expects cash used for purchases of land, buildings, and equipment in 2023 to be lower than in 2022, driven by its reduced operational focus.
Three Months Ended March 31, | ||||||||||||||||
In Thousands | 2023 | 2022 | $ Change | % Change | ||||||||||||
Proceeds from common stock issuance | $ | — | $ | 11,209 | $ | (11,209 | ) | (100 | )% | |||||||
Costs incurred related to the issuance of stock | — | (704 | ) | 704 | 100 | % | ||||||||||
Proceeds from Cibus, LLC | 1,000 | — | 1,000 | NM | ||||||||||||
Repayments of financing lease obligations | (97 | ) | (94 | ) | (3 | ) | (3 | )% | ||||||||
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Net cash provided by financing activities | $ | 903 | $ | 10,411 | (9,508 | ) | (91 | )% | ||||||||
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In Thousands, except percentage values | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Proceeds from Class A common stock issuance | $ | — | $ | 11,209 | $ | (11,209) | (100) | % | ||||||||||||||||||
Costs incurred related to the issuance of Class A common stock | — | (962) | 962 | 100 | % | |||||||||||||||||||||
Proceeds from draws on revolving line of credit from Cibus Global, LLC | 2,500 | — | 2,500 | NM | ||||||||||||||||||||||
Payment of taxes related to vested restricted stock units | (742) | — | (742) | NM | ||||||||||||||||||||||
Proceeds from issuance of notes payable | 1,287 | — | 1,287 | NM | ||||||||||||||||||||||
Repayments of financing lease obligations | (242) | (353) | 111 | 31 | % | |||||||||||||||||||||
Repayments of notes payable | (760) | — | (760) | NM | ||||||||||||||||||||||
Net cash provided by financing activities | $ | 2,043 | $ | 9,894 | $ | (7,851) | (79) | % |
notes payable related to equipment and insurance policy purchases.
The Company expects net cash provided by financing activities in 2023 to decrease comparedbe similar to 2022 driven by potential financing transactions completed in 2022.
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activity as the Company evaluates capital markets conditions during the fourth quarter of 2023.
Capital Resources
Operating Capital Requirements
The Company has incurred losses since its inception and its net loss was $5.4$60.4 million for the threenine months ended March 31,September 30, 2023, and it used $2.4$29.2 million of cash for operating activities for the threenine months ended March 31,September 30, 2023.
If the Transactions are not consummated for any reason, The Company’s primary source of liquidity is its cash and cash equivalents, with additional capital resources accessible, subject to market conditions and other factors, including limitations that may apply to the Company under applicable SEC and Nasdaq regulations, from the capital markets, including through stock offerings of common stock or other securities, which may decidebe implemented pursuant to dissolve and liquidate its assets.the Company’s effective registration statement on Form S-3. In such a circumstance, Calyxt would be requiredaddition, the Loan, which automatically terminates if the Company secures additional financing in the aggregate amount of $20.0 million prior to pay its debts and contractual obligations andJanuary 1, 2024, is intended to set aside certain reserves for potential future claims. In light of Calyxt’s currentprovide additional certainty with respect to the Company’s capital resources as it is highly unlikely, in this case, that substantial resources, if any, would be available for distribution to stockholders.
To the extent the Transactions are not consummated for any reason andpursues additional debt and/or equity financing.
As of September 30, 2023, the Company is not liquidatedhad $31.9 million of cash and dissolved, itcash equivalents. Current liabilities were $25.1 million as of September 30, 2023.
As part of the Company’s strategic realignment discussed above, the Company has initiated cost reduction initiatives designed to preserve capital resources for the advancement of its priority objectives, which initiatives include reductions in capital expenditures, streamlining of independent contractor utilization, and prioritization of near-term payment obligations.
The Company has incurred losses since its inception and anticipates that it will continue to generate losses for the next several years or until such time as an alternative strategic transaction is consummated.
Inyears. Over the less likely scenario in which the Company seeks to continue to operate its businesslonger term and until the Company can generate cash flows sufficient to support its operating capital requirements, it would seekexpects to finance a portion of future cash needs through (i) cash on hand, (ii) commercialization activities, which may result in various types of revenue streams from (a) future product developmenttrait R&D collaboration agreements and technology licenses, including upfront and milestone payments, annual license fees, and royalties; and (b) product sales from its proprietary BioFactory production system; (iii) government or other third-party funding (iv) public or private equity or debt financings, (v) the execution of strategic transactions, or (vi)(v) a combination of the foregoing. However, capital generated by commercialization activities, if any, is expected to be received over a period of time and near-term additional capital may not be available on reasonable terms, if at all.
The Company’s primary capital resources are its cash and cash equivalents and available Interim Funding.
The Company faces uncertainty regarding the adequacy of its capital resources and presently has limited access to additional financing and expects to rely upon the Interim Funding in order to continue operations through the consummation of the Transactions.
While certain public and private transaction structures may be available to the Company, these may require additional time and cost, may result in fixed payment obligations, may result in substantial dilution to existing stockholders, particularly in light of the Company’s current stock price, may impose operational restrictions on the Company, may grant holders rights senior to those of the Company’s shares of common stock, and may not be available on attractive terms. Further, during the pendency of the Transactions, any such transactions could only be entered into with the consent of Cibus. Accordingly, although the Company continuously assesses market conditions and available financing alternatives, in light of the Company’s current stock price, the restrictions imposed by the Merger Agreement and the availability of the Interim Funding, the Company does not anticipate any additional third-party funding prior to or not contingent upon the consummation of the Transactions.
The Company believes its cash and cash equivalents as of March 31, 2023, considering continuing actions taken to reduce its operating expenses to enable the proposed Transactions to close, the legal settlement discussed in Note 8 to the consolidated financial statements, and the availability of the Interim Funding, are sufficient to fund its operations through the second quarter of 2023. The Company’s management has concluded there is substantial doubt regarding its ability to continue as a going concern for a period of 12 months or more from the date of filing of this Quarterly report on Form 10-Q.
The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above.
In light
The Company’s ability to continue as a going concern will depend on its ability to obtain additional public or private equity or debt financing, obtain government or private grants and other similar types of funding, attain further operating efficiencies, reduce or contain expenditures, and, ultimately, to generate revenue. The Company believes that its cash and cash equivalents as of September 30, 2023 is not sufficient to fund its operations for a period of 12 months or more from the Company’s current liquidity challengesdate of this filing. Taking into account anticipated cost savings and without giving effect to potential financing transactions that Cibus is pursuing, Cibus expects that existing cash and cash equivalents will fund planned operating expenses and capital resource constraints, managementexpenditure requirements into early in the first quarter of 2024.
Management will need to raise additional capital to support its business plans to continue as a going concern within one year after the date that these financial statements are issued. Although the Company has implemented cost reduction and other cash-focused measures to manage liquidity, including reduction of capital expenditures,a strategic realignment, which has included headcount reductions, and renegotiation or termination of professional services agreements. To conserve cash, the Company has also strategically evaluated its arrangements with suppliers and service providers and has, in several instances, transitioned such relationshipsinitiated cost reduction initiatives designed to lower cost alternative providers. During the course of discussions with Cibus regarding, and following the execution of, the Merger Agreement, Calyxt has further streamlined and focused its business activities on preserving cash sufficient to achieve a closing of the Mergers. Accordingly, Calyxt has taken additional steps to reduce its operating expenses and has focused its continuing operations on scaling production of its Plant Cell Matrix™ structures with its manufacturing partner, licensing efforts with respect to its PlantSpring™ technology and plant traits, and continuing to progress its three key customer projects.
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Ifpreserve capital resources, if the Company is unable to raise additional capital in a sufficient amount or on acceptable terms, or to consummate the Transactions, the Company may have to implement increasinglyadditional, more stringent cost savingreduction measures to manage liquidity, and the Company may have to significantly delay, scale back, or cease operations, in part or in full. If the Company decidedraises additional funds through the issuance of additional debt or equity securities, including as part of a strategic alternative, it could result in substantial dilution to cease operations and dissolve and liquidate its assets, it is unclear to what extent the Company would be able to pay its existing obligations. In such a circumstancestockholders and in lightincreased fixed payment obligations, and these securities may have rights senior to those of the Company’s currentshares of common stock. These factors raise substantial doubt about the Company's ability to continue as a going concern for at least one year from the date of issuance of these financial statements. Any of these events could impact the Company’s business, financial condition, and prospects.
The Company’s financing needs are subject to change depending on, among other things, the success of its trait and product development efforts, the effective execution of its business model, its revenue, and its efforts to effectively manage expenses. The effects of macroeconomic events and potential geopolitical developments on the financial markets and broader economic uncertainties may make obtaining capital resources position, it is unlikelythrough equity or debt financings more challenging and may exacerbate the risk that substantial resources wouldsuch capital, if available, may not be available for distributionson terms acceptable to stockholders.
the Company.
In Thousands | Operating Lease Obligations | Financing Lease Obligations | Notes Payable | Total | ||||||||||||||||||||||
Remainder of 2023 | $ | 1,758 | $ | 40 | $ | 520 | $ | 2,318 | ||||||||||||||||||
2024 | 7,132 | 210 | 860 | 8,202 | ||||||||||||||||||||||
2025 | 4,797 | 120 | 351 | 5,268 | ||||||||||||||||||||||
2026 | 1,993 | — | 151 | 2,144 | ||||||||||||||||||||||
2027 | 1,920 | — | 89 | 2,009 | ||||||||||||||||||||||
2028 | 1,863 | — | 15 | 1,878 | ||||||||||||||||||||||
Thereafter | 15,438 | — | — | 15,438 | ||||||||||||||||||||||
34,901 | 370 | 1,986 | 37,257 | |||||||||||||||||||||||
Less: interest | (10,621) | (33) | (192) | (10,846) | ||||||||||||||||||||||
Total | $ | 24,280 | $ | 337 | $ | 1,794 | $ | 26,411 | ||||||||||||||||||
Current portion | 5,436 | 235 | 1,165 | 6,836 | ||||||||||||||||||||||
Noncurrent portion | $ | 18,844 | $ | 102 | $ | 629 | $ | 19,575 |
As of March 31, | As of December 31, | |||||||
2023 | 2022 | |||||||
Estimated fair value of Common Warrants | $ | 1.43 | $ | 0.37 | ||||
Assumptions: | ||||||||
Risk-free interest rate | 3.8 | % | 4.0 | % | ||||
Expected volatility | 90.0 | % | 85.0 | % | ||||
Expected term to liquidation (in years) | 4.4 | 4.6 |
As of September 30, 2023 | As of December 31, 2022 | ||||||||||
Estimated fair value of Common Warrants | $ | 9.54 | $ | 1.87 | |||||||
Assumptions: | |||||||||||
Risk-free interest rate | 4.7 | % | 4.0 | % | |||||||
Expected volatility | 107.1 | % | 85.0 | % | |||||||
Expected term to liquidation (in years) | 3.9 | 4.6 |
Item 3. Quantitative and Qualitative Disclosures About Market Risk
For quantitative and qualitative disclosures about market risk that affect us, see “Quantitative and Qualitative Disclosures About Market Risk” in Item 7A of Part II of the Annual Report. There have been no material changes in information that would have been provided in the context of Item 3 from the end of the preceding fiscal year until March 31, 2023. However, the Company does provide risk management discussion in various places in this Quarterly Report on Form 10-Q, primarily in Note 3. Financial Instruments Measured at Fair Value and Concentrations of Credit Risk.
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There were no
heading “Item 8.01 – Other Events—Supplemental Risk Factors” in the Company's Current Report on Form 8-K filed on October 18, 2023.
Proceeds, and Issuer Purchases of Equity Securities.
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Exhibit Number | Description | |||||||
|
| |||||||
2.2 | ||||||||
3.1 | ||||||||
3.2 | ||||||||
10.1 | ||||||||
31.1* | ||||||||
31.2* | ||||||||
32* | ||||||||
101.INS* | Inline XBRL Instance Document | |||||||
101.SCH* | Inline XBRL Taxonomy Extension Schema Document | |||||||
101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | |||||||
101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document | |||||||
101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
104* | The cover page for the Company’s Quarterly Report on Form 10-Q for the quarter ended |
|
|
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SIGNATURE
Pursuant to the requirements of the Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on May 1,November 9, 2023.
CIBUS, INC. | |||||||||||
| |||||||||||
By: | /s/ Rory Riggs | ||||||||||
Name: |
| Rory Riggs | |||||||||
Title: | Chief Executive Officer and Chairman (Principal Executive Officer) | ||||||||||
| |||||||||||
By: | /s/ Wade King | ||||||||||
Name: | Wade King | ||||||||||
Title: | Chief Financial Officer (Principal Financial and Accounting Officer) |
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