Calidi Biotherapeutics(US:CLDI)2024-05-14 20:57PART I - FINANCIAL INFORMATION This section presents the unaudited condensed consolidated financial statements and management's analysis of the company's financial condition and results of operations Item 1. Condensed Consolidated Financial Statements (unaudited) The unaudited condensed consolidated financial statements for Calidi Biotherapeutics, Inc. as of March 31, 2024, show a net loss of $7.2 million for the quarter and an accumulated deficit of $106.8 million, raising going concern doubts Condensed Consolidated Balance Sheets The balance sheet as of March 31, 2024, shows total assets decreased to $7.4 million and total liabilities increased to $22.0 million, resulting in a larger stockholders' deficit Balance Sheet Comparison (in thousands) | Metric | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash | $1,143 | $1,949 | | Total Current Assets | $1,936 | $4,303 | | Total Assets | $7,405 | $10,019 | | Total Current Liabilities | $14,953 | $10,232 | | Total Liabilities | $21,978 | $18,254 | | Total Stockholders' Deficit | ($14,573) | ($8,235) | Condensed Consolidated Statements of Operations For the three months ended March 31, 2024, the company reported a net loss of $7.2 million, an increase from the prior year, driven by higher operating expenses Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Research and development | ($2,743) | ($2,622) | | General and administrative | ($4,009) | ($2,792) | | Loss from operations | ($6,752) | ($5,414) | | Total other expenses, net | ($469) | ($1,044) | | Net Loss | ($7,225) | ($6,462) | | Net loss per share; basic and diluted | ($0.20) | ($0.75) | | Weighted average common shares outstanding | 35,552 | 8,655 | Condensed Consolidated Statements of Cash Flows Net cash used in operating activities increased to $3.8 million in Q1 2024, partially offset by $3.0 million from financing activities, leading to a net cash decrease Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | ($3,831) | ($3,107) | | Net cash used in investing activities | ($5) | ($137) | | Net cash provided by financing activities | $3,013 | $3,791 | | Net (decrease) increase in cash | ($806) | $547 | Notes to Condensed Consolidated Financial Statements The notes detail the company's operations, accounting policies, 'going concern' warning, debt, warrants, and significant post-quarter financing events - The company has experienced recurring losses and negative cash flows, with an accumulated deficit of $106.8 million as of March 31, 2024. Management has concluded there is substantial doubt about the company's ability to continue as a going concern for the next 12 months3964 - In March 2024, the company entered into a settlement agreement involving the issuance of $3.5 million in convertible notes, with $2.0 million for cash and $1.5 million to settle prior funding claims5 - Subsequent to the quarter end, in April 2024, the company closed a public offering for gross proceeds of approximately $6.1 million, extended the maturity of several term notes, and repaid a $1.5 million convertible note307308309 - The company is involved in legal proceedings, including a dispute with a former Chief Accounting Officer and a recently settled matter with physicians regarding stock options, which resulted in the issuance of restricted stock and warrants233295 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's clinical-stage status, significant operating losses, and substantial doubt about its going concern ability, highlighting recent financing efforts - The company is a clinical-stage immuno-oncology firm developing stem cell-based platforms (NeuroNova™, SuperNova™) to deliver oncolytic viruses for cancer treatment, with key candidates including CLD-101 for gliomas and CLD-201 for solid tumors313323324 - Management explicitly states there is substantial doubt about the company's ability to continue as a going concern, as existing cash as of May 10, 2024, is insufficient to continue operations through June 2024 without raising additional capital327392 Q1 2024 vs Q1 2023 Operating Expense Comparison (in thousands) | Expense Category | Q1 2024 | Q1 2023 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Research & Development | $2,743 | $2,622 | $121 | 5% | | General & Administrative | $4,009 | $2,792 | $1,217 | 44% | | Total Operating Expenses | $6,752 | $5,414 | $1,338 | 25% | - To address liquidity issues, the company raised $3.0 million from convertible notes in Q1 2024 and an additional $6.1 million in gross proceeds from a public offering in April 2024409509 Item 3. Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, the company is not required to provide detailed market risk disclosures and believes it has no significant exposure to interest rate, foreign currency, or inflation risks - As a smaller reporting company, the company is not required to provide detailed disclosures about market risk445 - The company does not believe it has significant exposure to interest rate risk, foreign currency risk, or inflation417439440 Item 4. Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 31, 2024, with no material changes to internal control over financial reporting - The CEO and CFO concluded that disclosure controls and procedures were effective as of March 31, 2024422 - There were no changes in internal control over financial reporting during the quarter that materially affected, or were reasonably likely to materially affect, the company's internal controls423 PART II - OTHER INFORMATION This section covers legal proceedings, key risk factors, unregistered equity sales, and other required disclosures Item 1. Legal Proceedings The company is subject to litigation, including a recent complaint filed by a former Chief Accounting Officer regarding share restrictions - On May 1, 2024, former CAO Tony Kalajian filed a complaint against the company regarding the restrictive legend on 139,423 shares of Common Stock, seeking damages and an order to remove the legend348425 Item 1A. Risk Factors Critical risks include insufficient cash for ongoing operations, substantial doubt about going concern, and significant stockholder dilution from future capital raises and price reset features - The company has insufficient cash to continue operations for the next 12 months, raising substantial doubt about its ability to continue as a going concern427449 - Future sales of common stock to raise capital will result in significant dilution to existing stockholders and could cause the share price to fall428450 - Certain outstanding warrants and convertible notes have exercise or conversion prices that are subject to a reset, which could significantly increase the number of shares issuable and cause further dilution430451 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds In February 2024, the company issued 50,000 shares of common stock to a consultant, with another 50,000 shares to be issued later, under a registration exemption - On March 25, 2024, the company issued 50,000 shares of common stock to a consultant for marketing services, with another 50,000 shares to be issued later, and the issuance was exempt from registration under Section 4(a)(2) of the Securities Act432453 Item 3. Defaults Upon Senior Securities The company reported no defaults upon its senior securities during the period - None433454 Item 4. Mine Safety Disclosures This item is not applicable to the company - Not applicable434462 Item 5. Other Information The company reported no other information for this item - None435455 Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including various agreements, officer certifications, and XBRL data files - Exhibits filed include agreements for convertible promissory notes, a settlement agreement, officer certifications, and XBRL interactive data files436457464