| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description
of Business Imunon,
Inc. (“Imunon” or the “Company”) is a clinical-stage biotechnology company focused on advancing a portfolio of
innovative treatments that harness the body’s natural mechanisms with the aim to generate safe, effective and durable responses
across a broad array of human diseases, constituting a differentiating approach from conventional therapies. Imunon is developing its
non-viral DNA technology across its modalities. The first modality, TheraPlas®, is developed for the coding of proteins and cytokines
in the treatment of solid tumors where an immunological approach is deemed promising. The second modality, PlaCCine®, is developed
for the coding of viral antigens that can elicit a strong immunological response. This technology may represent a promising platform
for the development of vaccines in infectious diseases. The
Company’s lead clinical program, IMNN-001, is a DNA-based immunotherapy for the localized treatment of advanced ovarian cancer
that has completed Phase II clinical studies. IMNN-001 works by instructing the body to produce safe and durable levels of powerful cancer-fighting
molecules, such as interleukin-12 and interferon gamma, at the tumor site. Additionally, the Company has entered a first-in-human study
of its COVID-19 booster vaccine (IMNN-101). The Company will continue to leverage these modalities and to advance the technological frontier
of plasmid DNA to better serve patients with difficult-to-treat conditions. Basis
of Presentation The
accompanying consolidated financial statements (“Financial Statements”) of Imunon have been prepared in accordance with accounting
principles generally accepted in the United States of America (“GAAP”) and include the accounts of the Company and CLSN Laboratories,
Inc. The Company dissolved Celsion GmbH in 2023. All significant intercompany balances and transactions have been eliminated in consolidation. Accounting
Standards Update: Improvements to Reportable Segment Disclosures In
November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”.
The disclosure requirements are required on an annual and interim basis and are applicable to entities with a single reportable segment.
The amendments in the ASU require disclosures to include significant segment expenses that are regularly provided to the chief operating
decision maker (“CODM”), a description of other segment items by reportable segment, and any additional measures of a segment’s
profit or loss used by the CODM when deciding how to allocate resources. ASU 2023-07 is effective for fiscal years beginning after December
15, 2023 and interim periods for fiscal years beginning after December 31, 2024, with early adoption allowed. We adopted this guidance
as of January 1, 2024 on a retrospective basis and the adoption did not have a material impact on our consolidated financial statements.
Refer to Note 3, “ Segment Performance Measures and Expenses Use
of Estimates The
preparation of financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Financial Statements and the
reported amounts of expenses during the reporting period. Actual results could differ significantly from those estimates. Revenue
Recognition The
Company did not generate any revenue in 2024 or 2023 and there were no Cash
and Cash Equivalents Cash
and cash equivalents include cash on hand and investments purchased with an original maturity of three months or less. A portion of these
funds are not covered by FDIC insurance. Fair
Value of Financial Instruments The
carrying values of financial instruments approximate their respective fair values. Management believes that the carrying amounts of the
Company’s financial instruments, including cash and cash equivalents and accounts payable approximate fair value due to the short-term
nature of those instruments. Short-term investments are recorded at their estimated fair value. Short-Term
Investments The
Company classifies its investments in debt securities with readily determinable fair values as investments available-for-sale in accordance
with Accounting Standards Codification (“ASC”) 320, Investments - Debt and Equity Securities Property
and Equipment Property
and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is provided over the estimated useful lives
of the related assets, ranging from three seven years 240,000 248,000 The
Company reviews property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of
an asset may not be recoverable. An asset is considered impaired if its carrying amount exceeds the future net undiscounted cash flows
that the asset is expected to generate. If such asset is considered to be impaired, the impairment recognized is the amount by which
the carrying amount of the asset, if any, exceeds its fair value determined using a discounted cash flow model. There was no Advances
and Deposits on Clinical Programs and Other Current Assets Supplies
are consumable items kept on hand to support the Company’s R&D and manufacturing operations which includes prepaid expense,
raw materials, clinical supplies and consumable items for clinical trials with alternate uses that are capitalized. Supplies are recorded
at cost and are charged to expense as they are used in operations. The Company regularly reviews the quality and utilization of supplies
to determine if future use of these supplies is probable. Due to the generic use of these supplies, they can be used in multiple projects
other than those currently being studied. Deposits Deposits
include real property security deposits and other deposits which are contractually required and of a long-term nature. Comprehensive
Income (Loss) ASC
220, Comprehensive Income Research
and Development Research
and development costs are expensed as incurred. Supplies are consumable and recorded at cost and are charged to expense as they are
used in operations. Equipment and facilities acquired for research and development activities that have alternative future uses are
capitalized and charged to expense over their estimated useful lives. Net
Loss per Share of Common Stock Basic
and diluted net loss per common share was computed by dividing net loss for the year by the weighted average number of shares of common
stock outstanding, both basic and diluted, during each period. The impact of common stock equivalents has been excluded from the computation
of diluted weighted average common shares outstanding in periods where there is a net loss, as their effect is anti-dilutive. For
the years ended December 31, 2024 and 2023, the total number of shares of common stock issuable upon exercise of warrants and equity
awards was 6,840,633 1,255,642 Income
Taxes Income
taxes are accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for
the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities
and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered
or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in results of operations in the
period that the tax rate change occurs. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount
expected to be realized. In accordance with ASC 740, Income Taxes, As
more fully discussed in Note 10, on November 28, 2023, the Company received approval from the New Jersey Economic Development Authority
to sell $ 1.3 1.3 1.3 15 20 0.4 Stock-Based
Compensation The
Company accounts for all share-based payment awards granted to employees and non-employees as stock-based compensation expense at
grant date fair value. The Company’s share-based payments include stock options and grants of common stock, including common
stock subject to vesting. The measurement date for employee awards is the date of grant, and stock-based compensation costs are
recognized as expense over the employees’ requisite service period, which is the vesting period, on a straight-line basis.
Prior to the adoption of Accounting Standards Update (“ASU”) No. 2018-07, Compensation—Stock Compensation
(Topic 718): Improvements to Nonemployee Share-Based Payment Accounting The
fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model. Since there is
limited historical data of the Company’s share price on the public market, the Company estimates its expected stock volatility
based on the historical volatility of a publicly traded set of representative companies and expects to continue to do so until such time
as it has adequate historical data regarding the volatility of its own traded stock price. The expected term of the Company’s stock
options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options.
The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for
time periods approximately equal to the expected term of the award. Expected dividend yield is based on the fact that the Company has
never paid cash dividends on common stock and does not expect to pay any cash dividends in the foreseeable future. Warrant
Accounting We
account for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrants’ specific
terms and applicable authoritative guidance in ASC 480, “Distinguishing Liabilities from Equity” (“ASC 480”),
and ASC 815 “Derivatives and Hedging” (“ASC 815”). The assessment considers whether the warrants are freestanding
financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all
of the requirements for equity classification under ASC 815, including whether the warrants are indexed to our own ordinary shares and
whether warrant holders could potentially require “net cash settlement” in a circumstance outside of our control, among other
conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant
issuance and as of each subsequent quarterly period end-date while the warrants are outstanding. For
issued or modified warrants that meet all the criteria for equity classification, the warrants are required to be recorded as a component
of equity at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants
are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter.
Changes in the estimated fair value of warrants classified as liabilities are recognized as a non-cash gain or loss on our statements
of operations. As
the warrants issued upon our financings in 2024 meet the criteria for equity classification under ASC 815, those warrants were classified
as equity as of December 31, 2024. No warrants were issued in 2023. Recent
Accounting Pronouncements From
time to time, new accounting pronouncements are issued by the FASB and are adopted by the Company as of the specified effective date.
Unless otherwise discussed, the Company believes that the impact of recently issued accounting pronouncements will not have a material
impact on the Company’s consolidated financial position, results of operations, and cash flows, or do not apply to its operations. In
November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”.
The disclosure requirements are required on an annual and interim basis and are applicable to entities with a single reportable segment.
The amendments in the ASU require disclosures to include significant segment expenses that are regularly provided to the chief operating
decision maker (“CODM”), a description of other segment items by reportable segment, and any additional measures of a segment’s
profit or loss used by the CODM when deciding how to allocate resources. ASU 2023-07 is effective for fiscal years beginning after December
15, 2023 and interim periods for fiscal years beginning after December 31, 2024, with early adoption allowed. We adopted this guidance
as of January 1, 2024 on a retrospective basis and the adoption did not have a material impact on our consolidated financial statements.
Refer to Note 3, “ Segment Performance Measures and Expenses In
December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures In
November 2024, the FASB issued Accounting Standards Update No. 2024-03, Income Statement – Reporting Comprehensive Income –
Expense Disaggregation Disclosures: Disaggregation of Income Statement Expenses (“ASU 2024-03”). ASU 2024-03 will require
more detailed information about the types of expenses in commonly presented income statement captions such as “Cost of sales”
and “Selling, general and administrative expenses”. The new guidance is effective for annual reporting periods beginning
after December 15, 2026, and interim reporting periods beginning after December 15, 2027 with early adoption permitted. The Company is
currently evaluating the impact that this change will have on the Company’s disclosures. |
