Quarterly Report (10-q)

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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended November 30, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1933

For the transition period from to

Commission File Number: 000-49908

CYTODYN INC.

(Exact name of registrant as specified in its charter)


Delaware	83-1887078
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer or Identification No.)

1111 Main Street, Suite 660 Vancouver, Washington	98660
(Address of principal executive offices)	(Zip Code)

(360) 980-8524

(Registrant’s telephone number, including area code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
None		None		None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large Accelerated Filer	☒	Accelerated Filer	☐

Non-accelerated Filer	☐	Smaller Reporting Company	☒

		Emerging Growth Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☐ No ☒

On December 31, 2022, there were 832,970,710 shares outstanding of the registrant’s $0.001 par value common stock.

Table of Contents

TABLE OF CONTENTS


		PAGE
PART I Financial Information		3
	ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS	3
	ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	27
	ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	40
	ITEM 4. CONTROLS AND PROCEDURES	40
PART II Other Information		42
	ITEM 1. LEGAL PROCEEDINGS	42
	ITEM 1A. RISK FACTORS	42
	ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	43
	ITEM 6. EXHIBITS	45

Table of Contents

PART I. Financial Information

Item 1. Consolidated Financial Statements

CytoDyn Inc.

Consolidated Balance Sheets

(Unaudited, in thousands, except par value)


		November 30, 2022		May 31, 2022
Assets
Current assets:
Cash	$	2,403	$	4,231
Restricted cash		200		—
Prepaid expenses		2,854		5,198
Prepaid service fees		1,094		1,086
Total current assets		6,551		10,515
Inventories, net		—		17,929
Other non-current assets		523		741
Total assets	$	7,074	$	29,185
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable	$	67,187	$	67,974
Accrued liabilities and compensation		5,722		8,995
Accrued interest on convertible notes		8,279		5,974
Accrued dividends on convertible preferred stock		4,571		3,977
Convertible notes payable, net		36,931		36,241
Total current liabilities		122,690		123,161
Operating leases		353		422
Total liabilities		123,043		123,583
Commitments and Contingencies (Note 9)
Stockholders’ deficit:
Preferred stock, $0.001 par value; 5,000 shares authorized:
Series B convertible preferred stock, $0.001 par value; 400 authorized; 19 issued and outstanding at November 30, 2022 and May 31, 2022, respectively		—		—
Series C convertible preferred stock, $0.001 par value; 8 authorized; 6 and 7 issued and outstanding at November 30, 2022 and May 31, 2022, respectively		—		—
Series D convertible preferred stock, $0.001 par value; 12 authorized; 9 issued and outstanding at November 30, 2022 and May 31, 2022, respectively		—		—
Common stock, $0.001 par value; 1,350,000 shares authorized; 825,279 and 720,028 issued, and 824,836 and 719,585 outstanding at November 30, 2022 and May 31, 2022, respectively		825		720
Treasury stock, $0.001 par value; 443 at November 30, 2022 and May 31, 2022		—		—
Additional paid-in capital		692,558		671,013
Accumulated deficit		(809,352)		(766,131)
Total stockholders’ deficit		(115,969)		(94,398)
Total liabilities and stockholders' deficit	$	7,074	$	29,185

See accompanying notes to consolidated financial statements.

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CytoDyn Inc.

Consolidated Statements of Operations

(Unaudited, in thousands, except per share data)


	Three months ended November 30,				Six months ended November 30,
	2022		2021		2022		2021
				(Restated) ⁽¹⁾				(Restated) ⁽¹⁾
Revenue	$	—	$	225	$	—	$	266
Cost of goods sold		—		52		—		53
Gross profit		—		173		—		213
Operating expenses:
General and administrative		5,043		16,203		11,376		23,820
Research and development		137		7,447		713		19,467
Amortization and depreciation		54		252		153		528
Inventory charge		17,929		1,593		20,633		3,357
Total operating expenses		23,163		25,495		32,875		47,172
Operating loss		(23,163)		(25,322)		(32,875)		(46,959)
Interest and other expenses:
Interest on convertible notes		(1,159)		(1,426)		(2,305)		(3,112)
Amortization of discount on convertible notes		(580)		(793)		(1,156)		(1,745)
Amortization of debt issuance costs		(18)		(23)		(34)		(51)
Loss on induced conversion		(638)		(6,785)		(638)		(25,315)
Finance charges		(937)		(1,024)		(1,877)		(1,059)
Inducement interest expense		—		(4,704)		—		(5,232)
Legal settlement		—		—		—		(1,941)
Loss on derivatives		—		—		(8,601)		—
Total interest and other expenses		(3,332)		(14,755)		(14,611)		(38,455)
Loss before income taxes		(26,495)		(40,077)		(47,486)		(85,414)
Income tax benefit		—		—		—		—
Net loss	$	(26,495)	$	(40,077)	$	(47,486)	$	(85,414)
Basic and diluted:
Weighted average common shares outstanding		813,373		662,600	$	800,545		647,517
Loss per share	$	(0.03)	$	(0.06)		(0.07)	$	(0.13)

(1) See Note 2, Summary of Significant Accounting Policies—Revision and Restatement of Financial Statements.

See accompanying notes to consolidated financial statements.

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CytoDyn Inc.

Consolidated Statement of Changes in Stockholders’ Deficit

(Unaudited, in thousands)


	Preferred stock			Common stock			Treasury stock			Additional		Accumulated		Total stockholders'
	Shares	Amount		Shares	Amount		Shares	Amount		paid-in capital		deficit		deficit
Balance at May 31, 2022	35	$	—	720,028	$	720	443	$	—	$	671,013	$	(766,131)	$	(94,398)
Stock issued for compensation	—		—	879		1	—		—		344		—		345
Stock issued for private offerings	—		—	85,378		85	—		—		17,459		—		17,544
Issuance costs related to stock issued for private offerings	—		—	—		—	—		—		(6,289)		—		(6,289)
Conversion of Series C convertible preferred stock to common stock	(1)		—	1,136		1	—		—		(1)		—		—
Warrant exercises	—		—	657		1	—		—		263		—		264
Deemed dividend paid in common stock due to down round provision, recorded in additional paid-in capital	—		—	4,620		5	—		—		(5)		—		—
Dividends accrued on Series C and D convertible preferred stock	—		—	—		—	—		—		(384)		—		(384)
Reclassification of warrants from liability to equity classified	—		—	—		—	—		—		8,601		—		8,601
Stock-based compensation	—		—	—		—	—		—		996		—		996
Reclassification of prior period preferred stock dividends	—		—	—		—	—		—		(4,265)		4,265		—
Net loss	—		—	—		—	—		—		—		(20,991)		(20,991)
Balance at August 31, 2022	34		—	812,698		813	443		—		687,732		(782,857)		(94,312)
Issuance of stock for convertible note repayment	—		—	1,822		2	—		—		498		—		500
Loss on induced conversion	—		—	—		—	—		—		638		—		638
Stock issued for compensation	—		—	765		—	—		—		310		—		310
Exercise of warrants, net of offering costs	—		—	9,652		10	—		—		2,123		—		2,133
Make-whole shares related to private warrant exchange	—		—	23		—	—		—		—		—		—
Dividend paid in common stock upon conversion of Series C convertible preferred stock ($0.50 per share)	—		—	319		—	—		—		159		—		159
Dividends accrued on Series C and D convertible preferred stock	—		—	—		—	—		—		(369)		—		(369)
Stock-based compensation	—		—	—		—	—		—		1,467		—		1,467
Net loss	—		—	—		—	—		—		—		(26,495)		(26,495)
Balance at November 30, 2022	34	$	—	825,279	$	825	443	$	—	$	692,558	$	(809,352)	$	(115,969)

See accompanying notes to consolidated financial statements.

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	Preferred stock			Common stock			Treasury stock			Additional		Accumulated		Total stockholders'
	Shares	Amount		Shares	Amount		Shares	Amount		paid-in capital		deficit		deficit
										(Restated) ⁽¹⁾		(Restated) ⁽¹⁾		(Restated) ⁽¹⁾
Balance at May 31, 2021	96	$	—	626,123	$	626	443	$	—	$	532,031	$	(553,675)	$	(21,018)
Issuance of stock for convertible note repayment	—		—	11,816		12	—		—		13,832		—		13,844
Loss on induced conversion	—		—	—		—	—		—		18,530		—		18,530
Issuance of legal settlement warrants	—		—	—		—	—		—		1,744		—		1,744
Stock option exercises	—		—	300		—	—		—		189		—		189
Stock issued for compensation and tendered for income tax	—		—	1,014		1	—		—		(1)		—		—
Stock issued for private offerings	—		—	2,872		3	—		—		2,869		—		2,872
Private warrant exchanges	—		—	1,327		1	—		—		774		—		775
Warrant exercises	—		—	668		1	—		—		502		—		503
Inducement interest expense related to private warrant exchanges	—		—	—		—	—		—		528		—		528
Accrued preferred stock dividends	—		—	—		—	—		—		—		(420)		(420)
Stock-based compensation	—		—	—		—	—		—		2,597		—		2,597
Net loss	—		—	—		—	—		—		—		(45,337)		(45,337)
Balance at August 31, 2021	96		—	644,120		644	443		—		573,595		(599,432)		(25,193)
Issuance of stock for convertible note repayment	—		—	8,162		8	—		—		8,193		—		8,201
Loss on induced conversion	—		—	—		—	—		—		6,785		—		6,785
Stock option exercises	—		—	210		—	—		—		200		—		200
Stock issued for private offerings	—		—	25,178		25	—		—		27,282		—		27,307
Conversion of Series B preferred stock to common stock	(60)		—	600		1	—		—		—		—		1
Private warrant exchanges	—		—	6,593		7	—		—		4,608		—		4,615
Offering costs related to stock issuance	—		—	—		—	—		—		(1,418)		—		(1,418)
Warrant exercises	—		—	963		1	—		—		532		—		533
Inducement interest expense related to private warrant exchanges	—		—	—		—	—		—		4,704		—		4,704
Preferred stock dividends accrued and paid in common stock	—		—	35		—	—		—		17		(431)		(414)
Stock-based compensation	—		—	—		—	—		—		2,060		—		2,060
Net loss	—		—	—		—	—		—		—		(40,077)		(40,077)
Balance at November 30, 2021	36	$	—	685,861	$	686	443	$	—	$	626,558	$	(639,940)	$	(12,696)

(1) See Note 2, Summary of Significant Accounting Policies—Revision and Restatement of Financial Statements.

See accompanying notes to consolidated financial statements.

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CytoDyn Inc.

Consolidated Statements of Cash Flows

(Unaudited, in thousands)


	Six months ended November 30,
	2022		2021
				(Restated) ⁽¹⁾
Cash flows from operating activities:
Net loss	$	(47,486)	$	(85,414)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization and depreciation		153		528
Amortization of debt issuance costs		34		51
Amortization of discount on convertible notes		1,156		1,745
Warrants issued for legal settlement		—		1,744
Loss on derivatives		8,601		—
Loss on induced conversion		638		25,315
Inducement interest expense and non-cash finance charges		—		5,232
Inventory charge		20,633		3,357
Stock-based compensation		3,118		4,657
Changes in operating assets and liabilities:
Increase in prepaid expenses and other assets		(303)		(654)
Decrease in accounts payable and accrued expenses		(2,024)		(17,193)
Net cash used in operating activities		(15,480)		(60,632)
Cash flows from investing activities:
Furniture and equipment purchases		—		(13)
Net cash used in investing activities		—		(13)
Cash flows from financing activities:
Proceeds from warrant transactions, net of offering costs		2,133		5,390
Proceeds from sale of common stock and warrants, net of issuance costs		11,255		28,761
Proceeds from warrant exercises		264		1,036
Proceeds held in trust		200		—
Proceeds from stock option exercises		—		390
Net cash provided by financing activities		13,852		35,577
Net change in cash and restricted cash		(1,628)		(25,068)
Cash beginning of period		4,231		33,943
Cash end of period	$	2,603	$	8,875
Cash and restricted cash consisted of the following:
Cash	$	2,403	$	8,875
Restricted cash		200		—
Total cash and restricted cash	$	2,603	$	8,875
Supplemental disclosure:
Cash paid for interest	$	—	$	57
Non-cash investing and financing transactions:
Derivative liability associated with warrants	$	8,601	$	—
Issuance of common stock for principal and interest of convertible notes	$	500	$	22,045
Accrued dividends on Series C and D convertible preferred stock	$	753	$	834
Dividend paid in common stock on Series B and C convertible preferred stock conversions	$	159	$	17
Deemed dividend due to equity modifications, recorded in additional paid-in capital	$	5,294	$	—

(1) See Note 2, Summary of Significant Accounting Policies—Revision and Restatement of Financial Statements.

See accompanying notes to consolidated financial statements.

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CYTODYN INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AS OF NOVEMBER 30, 2022

(Unaudited)

Note 1. Organization

CytoDyn Inc. (together with its wholly owned subsidiaries, the “Company”) was originally incorporated under the laws of Colorado on May 2, 2002, under the name RexRay Corporation and, effective August 27, 2015, reincorporated under the laws of Delaware. The Company is a clinical-stage biotechnology company focused on the clinical development of innovative treatments for multiple therapeutic indications based on its product candidate, leronlimab (PRO 140), a novel humanized monoclonal antibody targeting the CCR5 receptor. The Company has been engaged in studying leronlimab for use in the treatment of human immunodeficiency virus (“HIV”), non-alcoholic steatohepatitis (“NASH”), and solid tumors in oncology.

The Company has been investigating leronlimab as a viral entry inhibitor for HIV, believed to competitively bind to the N-terminus and second extracellular loop of the CCR5 receptor. For immunology, the CCR5 receptor is believed to be implicated in immune-mediated illnesses such as NASH. The CCR5 receptor may also be present on cells that undergo malignant transformation and may also be present in the tumor microenvironment. Leronlimab is being studied in NASH, NASH-HIV, solid tumors in oncology, and other HIV indications where CCR5 is believed to play an integral role.

The Company is pursuing the regulatory approval of leronlimab in hopes that commercial sales will be obtained for one or more indications. The Company previously submitted a Biologic License Application (“BLA”) for leronlimab as a combination therapy with highly active antiretroviral therapy (“HAART”) for highly treatment-experienced HIV patients. In July 2020, the Company received a Refusal to File letter from the FDA regarding its BLA submission. The FDA informed the Company that the BLA did not contain certain information and data needed to complete a substantive review and therefore, the FDA would not file the BLA. In November 2021, the Company resubmitted the non-clinical and chemistry, manufacturing, and controls (“CMC”) sections of the BLA.

As previously reported and as described in Note 9, Commitments and Contingencies - Legal Proceedings, the Company encountered difficulties in obtaining the clinical data from its trials in the detail and format requested by the FDA in discussions with the Company in connection with its efforts to resubmit the BLA. The Company is engaged in litigation with its former contract research organization (“CRO”), which was responsible for gathering the required data. In the context of the litigation, the Company obtained an order requiring the CRO to release the Company’s clinical data related to the BLA and other clinical trials, which the CRO had been withholding. Further, the order granted the Company the right to perform an audit of the CRO’s services, which has been completed.

Additionally, in March 2022, the FDA placed the Company’s HIV trials on a partial clinical hold. In October 2022, the Company voluntarily withdrew its BLA submission after concluding that a significant risk existed that the BLA would not receive FDA approval due to the CRO's inadequate process and performance around the monitoring and oversight of the clinical data.

The Company’s efforts are currently directed toward obtaining removal of the clinical hold.

Note 2. Summary of Significant Accounting Policies

Basis of Presentation

The unaudited interim consolidated financial statements include the accounts of CytoDyn Inc. and its wholly owned subsidiaries, CytoDyn Operations Inc. and Advanced Genetic Technologies, Inc. (“AGTI”); AGTI is a dormant entity. All intercompany transactions and balances are eliminated in consolidation. The consolidated financial statements reflect all normal recurring adjustments which are, in the opinion of management, necessary for a fair statement of the results of operations for the interim financial statements. The interim financial information and notes thereto should be read in

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conjunction with the Company's latest Annual Report on Form 10-K for the fiscal year ended May 31, 2022 (the “2022 Form 10-K”). The results of operations for the periods presented are not necessarily indicative of results to be expected for the entire fiscal year or for any other future annual or interim period.

Reclassifications

Certain prior year and prior quarter amounts shown in the accompanying consolidated financial statements have been reclassified to conform to the current period presentation. Such reclassifications did not have material effect on the Company’s previously reported financial position, results of operations, stockholders’ deficit, or net cash provided by operating activities.

During the quarter ended August 31, 2022, the Company reclassified amounts recorded as accumulated dividends for Series C and D preferred stockholders from accumulated deficit to additional paid-in capital. These reclassifications were made to reflect the proper presentation for accrued dividends when an entity has accumulated deficit.

Revision and Restatement of Financial Statements

During the preparation of the quarterly financial statements as of and for the period ended November 30, 2021, the Company identified an error in how non-cash inducement interest expense was calculated in previous reporting periods dating back to fiscal year 2018. The error resulted in an understatement of non-cash inducement interest expense and additional paid-in capital. For details, refer to Note 2, Summary of Significant Accounting Policies - Revision of Financial Statements in the 2022 Form 10-K. Also, during the preparation and audit of the annual financial statements as of and for the fiscal year ended May 31, 2022, the Company concluded that a material error was identified in how the Company was accounting for common stock issued to settle certain convertible note obligations dating back to fiscal year 2021. For details, refer to Note 14, Restatement in the 2022 Form 10-K. Neither of the errors had impact on operating loss, cash, net cash used in or provided by operating, financing, and investing activities, assets, liabilities, commitments and contingencies, total stockholders’ deficit, number of shares issued and outstanding, basic and diluted weighted average common shares outstanding, and number of shares available for future issuance for any period presented, and are reflected in the accompanying statement of operations, changes in stockholders’ deficit, and statement of cash flows.

Going Concern

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As presented in the accompanying consolidated financial statements, the Company had losses for all periods presented. The Company incurred a net loss of approximately $47.5 million for the six months ended November 30, 2022 and has an accumulated deficit of approximately $809.4 million as of November 30, 2022. These factors, among several others, including the various legal matters discussed in Note 9, Commitments and Contingencies – Legal Proceedings, raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

The Company’s continuance as a going concern is dependent upon its ability to obtain additional operating capital, complete the development of its product candidate, leronlimab, obtain approval to commercialize leronlimab from regulatory agencies, continue to outsource manufacturing of leronlimab, and ultimately achieve revenues and attain profitability. The Company plans to continue to engage in research and development activities related to leronlimab for multiple indications and expects to incur significant research and development expenses in the future, primarily related to its regulatory compliance, including seeking the lifting of the FDA’s clinical hold with regard to the Company’s HIV program, performing additional clinical trials, and seeking regulatory approval for its product candidate for commercialization. These research and development activities are subject to significant risks and uncertainties. The Company intends to finance its future development activities and its working capital needs primarily from the sale of equity and debt securities, combined with additional funding from other sources. However, there can be no assurance that the Company will be successful in these endeavors.

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Use of Estimates

The preparation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States (U.S. GAAP) requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, and the disclosure of contingent assets and liabilities at the date of consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Estimates are assessed each period and updated to reflect current information, such as the status of our analysis of the results of our clinical trials and/or discussions with the FDA which could have an impact on the Company’s significant accounting estimates and assumptions. The Company’s estimates are based on historical experience and on various market and other relevant, appropriate assumptions. Significant estimates include, but are not limited to, those relating to capitalization of pre-launch inventories, charges for excess and obsolete inventories, research and development expenses, commitments and contingencies, stock-based compensation, and the assumptions used to value warrants and warrant modifications. Actual results could differ from these estimates.

Pre-launch Inventories

Pre-launch inventories were comprised of raw materials required to commercially produce leronlimab and substantially completed commercially produced leronlimab in anticipation of commercial sales of the product upon potential regulatory approval as a combination therapy for HIV patients in the United States. The Company’s pre-launch inventories consisted of (1) raw materials purchased for commercial production, (2) work-in-progress materials which consisted of bulk drug substance, which was the manufactured drug stored in bulk storage, and (3) drug product, which was the manufactured drug in unlabeled vials. The consumption of raw materials during production was classified as work-in-progress until saleable. Once it is determined to be in saleable condition, following regulatory approval, inventory is classified as finished goods.

The Company capitalizes inventories procured or produced in preparation for product launches. Typically, capitalization of such inventory begins when the results of clinical trials have reached a status sufficient to support regulatory approval, uncertainties regarding ultimate regulatory approval have been significantly reduced, and the Company has determined it is probable that these capitalized costs will provide future economic benefit in excess of capitalized costs. The material factors considered by the Company in evaluating these uncertainties include the receipt and analysis of positive Phase 3 clinical trial results for the underlying product candidate, results from meetings with the relevant regulatory authorities prior to the filing of regulatory applications, and status of the Company’s regulatory applications. The Company closely monitors the status of the product within the regulatory review and approval process, including all relevant communications with regulatory authorities. If the Company becomes aware of any specific material risks or contingencies other than the normal regulatory review and approval process or if there are any specific issues identified relating to safety, efficacy, manufacturing, marketing or labeling, it may make a determination that the related inventory no longer qualifies for capitalization.

The Company determines whether raw materials purchased for commercial production are usable for production based on the manufacturer’s assigned expiration date. In evaluating whether raw materials included in the pre-launch inventories will be usable for production, the Company takes into account the shelf-life of raw materials at the time they are expected to be used in manufacturing. Any raw materials past expiration date at the time of the next manufacturing run are removed from inventory.

As one stage of the manufacturing process, the Company produces work-in-progress materials which consist of bulk drug substance, which is the manufactured drug stored in bulk storage. The initial shelf-life of bulk drug substance is established based on prior experience and periodically performed stability studies and is set at four years from the date of manufacturing. Bulk drug substance is subject to deep freeze storage, and stability studies are performed on a periodic basis in accordance with the established stability protocols. If drug substance meets suitability criteria beyond the initial shelf-life, its shelf-life may be extended based on prior experience and stability trend analysis, and during the extension period periodic stability testing is performed on the drug substance. Regardless of the number of stability studies performed, if drug substance continues to meet prespecified suitability parameters it may be used in manufacturing; if

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drug substance fails to meet suitability criteria beyond its assigned shelf-life at that time, it may no longer be used and is considered to be expired.

The Company utilizes resins, a reusable raw material, in its bulk drug manufacturing process. Shelf-life of a resin used in commercial manufacturing of biologics is determined by the number of cycles for which it has been validated to be used in a manufacturing process before it is considered unusable. Unpacked and unused resins have a manufacturer’s expiration date by which resins are expected to start being used in the manufacturing process without loss of their properties. Prior to a new manufacturing campaign, and between manufacturing campaigns, the resins are removed from storage, and are treated and tested for suitability. Once resins are used in the manufacturing process, their shelf-life is measured by a validated predetermined number of manufacturing cycles they are usable for, conditional on appropriate storage solution under controlled environment between production campaigns, as well as by performing pre-production usability testing. Before a manufacturing campaign, each resin is tested for suitability. Regardless of the number of cycles, if a resin fails to meet prespecified suitability parameters it may not be used in manufacturing; likewise, even if the resin meets suitability criteria beyond the lifetime cycles, it may no longer be used. The cost of the resins used in a manufacturing campaign is allocated to the cost of the drug product in vials.

The Company values its inventory at the lower of cost or net realizable value using the average cost method. Inventory is evaluated for recoverability by considering the likelihood that revenue will be obtained from the future sale of the related inventory considering the status of the product within the regulatory approval process. The Company evaluates its inventory levels on a quarterly basis and writes down inventory that became obsolete, has a cost in excess of its expected net realizable value, or is in quantities in excess of expected requirements. In assessing the lower of cost or net realizable value for pre-launch inventory, the Company relies on independent analyses provided by third parties knowledgeable about the range of likely commercial prices comparable to current comparable commercial product. Quarterly, the Company also evaluates whether certain raw materials held in its inventory are expected to reach the end of their estimated shelf-lives based on passage of time, the number of manufacturing cycles they are used in and results of pre-production testing prior to the expected production date, or when resins used in the manufacturing process fail suitability tests. If any of such events occur, the Company may make a determination to record a charge if it is expected that such inventories will become obsolete prior to the expected production date.

Anticipated future sales, shelf lives, and expected approval date are considered when evaluating realizability of capitalized inventory. The shelf-life of a product is determined as part of the regulatory approval process; however, in assessing whether to capitalize pre-launch inventories, the Company considers the product stability data for all of the pre-approval inventory procured or produced to date to determine whether there is adequate shelf-life. When the remaining shelf-life of drug product inventory is less than 12 months, it is likely that it will not be accepted by potential customers. However, as inventories approach their shelf-life expiration, the Company may perform additional stability testing to determine if the inventory is still viable, which can result in an extension of its shelf-life and revaluation of the need for and the amount of the previously recorded reserves. Further, in addition to performing additional stability testing, certain raw materials inventory may be sold in its then current condition prior to reaching expiration. If the Company determines that it is not likely that shelf-life may be extended or the inventory cannot be sold prior to expiration, the Company may record a charge to bring inventory to its net realizable value.

In October 2022, the Company voluntarily withdrew its BLA submission after concluding that a significant risk existed that the BLA would not receive FDA approval due to the inadequate process and performance by its former CRO around the monitoring and oversight of the clinical data from its trials. Following this decision, none of the Company’s inventories now qualify for capitalization as pre-launch inventories. See Note 3, Inventories, net.

For additional information about the Company’s significant accounting policies, refer to Note 2, Summary of Significant Accounting Policies, in the 2022 Form 10-K.

Recently Adopted Accounting Pronouncements

In August 2020, the FASB issued ASU No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40), which simplifies the accounting for convertible instruments. The guidance removes certain accounting models that separate the embedded conversion features from the host contract for convertible instruments. Either a modified retrospective method of transition or a fully

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retrospective method of transition is permissible for the adoption of this standard. Update No. 2020-06 is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. The Company adopted ASU No. 2020-06 as of June 1, 2022, using the modified retrospective method. The adoption of ASU No. 2020-06 had no impact on the Company’s balance sheets, statements of operations, cash flows or financials statement disclosures.

In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation - Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. ASU 2021-04 addresses the accounting for certain modifications or exchanges of freestanding equity-classified written call options (e.g., warrants). Entities should treat a modification of the terms or conditions, or an exchange of a freestanding equity-classified written call option that remains equity-classified after modification or exchange, as an exchange of the original instrument for a new instrument. Guidance should be applied prospectively after the date of initial application. ASU 2021-04 is effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years, with early adoption permitted.

The Company adopted the new guidance prospectively as of June 1, 2022 and used the framework to record a modification to equity classified warrants during the six months ended November 30, 2022. The modification to equity instruments, consisting of a trigger of a down round provision was recorded as a deemed dividend in accordance with this guidance, resulting in an approximate $4.2 million charge to additional paid-in capital, induced warrant exercises recorded as $2.1 million issuance cost and $0.5 million deemed dividend, and the extension of warrant expiration dates recorded as a $0.5 million deemed dividend. The deemed dividends were included in the loss per share calculation; refer to Note 7, Loss per Common Share. Refer to Note 6, Equity Awards and Warrants for further information.

Note 3. Inventories, net

Inventories were as follows (in thousands):


	November 30, 2022		May 31, 2022
Raw materials	$	—	$	16,264
Work-in-progress		—		1,665
Total inventories, net	$	—	$	17,929

The table below summarizes pre-launch inventories that had been capitalized and charged-off for GAAP accounting purposes due to no longer qualifying for inventory capitalization as pre-launch inventories due to the withdrawal of the BLA submission and estimated expiration based on remaining shelf life. Work-in-progress and finished drug product inventories continue to be physically maintained, can be used for clinical trials, and can be commercially sold upon regulatory approval if the shelf-lives can be extended as a result of the performance of on-going stability tests. Raw material continues to be maintained so that they can be used in the future if needed.


			Raw Materials								Work-in-progress
(in thousands, Expiration period ending November 30,)	Remaining shelf-life (mos)		Specialized		Resins		Other		Total Raw Materials	Bulk drug product		Finished drug product		Total inventories
2023	0 to 12	$	4,764	$	16,264	$	-	$	21,028	$	-	$	-	$	21,028
2024	13 to 24		2,511		-		1,590		4,101		1,661		29,142		34,904
2025	25 to 36		189		-		-		189		-		32,343		32,532
2026	37 to 48		2,115		-		-		2,115		-		-		2,115
Thereafter	49 or more		-		-		-		-		-		-		-
Inventories, gross			9,579		16,264		1,590		27,433		1,661		61,485		90,579
Inventory charge			(9,579)		(16,264)		(1,590)		(27,433)		(1,661)		(61,485)		(90,579)
Inventories, net		$	-	$	-	$	-	$	-	$	-	$	-	$	-

During the first quarter of fiscal year 2023, the Company reviewed purchase commitments made by its manufacturing partner, Samsung BioLogics Co., Ltd. (“Samsung”), under the master agreement between the Company and Samsung, and its vendors for specialized raw materials for which the Company made a prepayment in the amount of

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$2.7 million in the third quarter of fiscal year 2022, which were recorded as prepaid expenses in the consolidated financial statements as of May 31, 2022. As discussed in Note 9, Commitments and Contingencies – Commitments with Samsung BioLogics Co., Ltd. (“Samsung”), the Company and its manufacturing partner remain in ongoing discussions about, among other things, deferring the unfulfilled commitments. These additional specialized raw materials are estimated to have shelf-lives ranging from 2023 to 2026. The entire amount was charged-off as of August 31, 2022.

In October 2022, the Company voluntarily withdrew its rolling BLA submission after concluding that a significant risk existed that the BLA would not receive FDA approval due to the inadequate process and performance by its former CRO around the monitoring and oversight of the clinical data from its trials. Following this decision, none of the Company’s inventories now qualify for capitalization as pre-launch inventories. For the three months ended November 30, 2022, the Company charged-off the remaining raw material resin and work-in-progress bulk product inventories of approximately $16.3 million and $1.7 million, respectively.

For additional information, refer to Note 2, Summary of Significant Accounting Policies – Pre-launch Inventories in this Form 10-Q, and to Note 3, Inventories, net, in the 2022 Form 10-K.

Note 4. Accounts Payable and Accrued Liabilities

As of November 30, 2022 and May 31, 2022, the accounts payable balance was approximately $67.2 million and $68.0 million, respectively, with two vendors accounting for 70% and 73% of the total balance of accounts payable at the respective dates.

The components of accrued liabilities are as follows (in thousands):


		November 30, 2022		May 31, 2022
Compensation and related expense	$	496	$	1,522
Legal fees and settlement		166		2,006
Clinical expense		1,176		3,727
Accrued inventory charges and expenses		3,155		1,392
License fees		393		150
Lease payable		136		134
Other liabilities		200		64
Total accrued liabilities	$	5,722	$	8,995

Note 5. Convertible Instruments and Accrued Interest

Convertible Preferred Stock

The following table presents the number of potentially issuable shares of common stock should shares of preferred stock and amounts of undeclared and accrued preferred dividends be converted to common stock.


	November 30, 2022						May 31, 2022
(in thousands)	Series B		Series C		Series D		Series B		Series C		Series D
Shares of preferred stock		19		6		9		19		7		9
Total shares of common stock if converted		190		12,670		10,565		190		13,806		10,565
Undeclared dividends	$	12	$	-	$	-	$	10	$	-	$	-
Accrued dividends	$	-	$	2,184	$	2,387	$	-	$	2,014	$	1,963
Total shares of common stock if dividends converted		25		4,368		4,774		20		4,028		3,926

Under the Company’s Amended and Restated Certificate of Incorporation, as amended (the “Certificate of Incorporation”), dividends on its outstanding shares of Series B Convertible Preferred Stock (the “Series B preferred stock”) may be paid in cash or shares of the Company’s common stock at the option of the Company. Dividends on outstanding shares of Series C Convertible Preferred Stock (the “Series C preferred stock”) and Series D Convertible Preferred Stock (the “Series D preferred stock”) are payable in cash or shares of common stock at the election of the

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holder. The preferred stockholders have the right to dividends only when and if declared by the Company’s Board of Directors. Under Section 170 of the Delaware General Corporation Law, the Company is permitted to pay dividends only out of capital surplus or, if none, out of net profits for the fiscal year in which the dividend is declared or net profits from the preceding fiscal year.

Series B Convertible Preferred Stock

Each share of the Series B preferred stock is convertible into ten shares of the Company’s common stock. Dividends are cumulative and payable to the Series B preferred stockholders when and as declared by the Company’s Board of Directors (the “Board”). Dividends on the Series B preferred stock accumulate at the rate of $0.25 per share per annum, and may be paid, at the option of the Company at the time of conversion, either in cash or shares of the Company’s common stock valued at $0.50 per share. The Series B preferred stock has liquidation preferences over the common shares at $5.00 per share, plus any accrued and unpaid dividends. Except as provided by law, the Series B preferred stockholders have no voting rights. The Company does not accrue dividends on Series B preferred stock until such dividends are declared.

Series C and Series D Convertible Preferred Stock

The Series C and Series D Certificates of Designation provide, among other things, that holders of Series C and Series D preferred stock shall be entitled to receive, when and as declared by the Board and out of any assets at the time legally available therefor, cumulative dividends at the rate of ten percent (10%) per share per annum of the stated value of the Series C and Series D preferred stock, which is $1,000 per share (the “Stated Value”). Dividends on the Series C and Series D preferred stock are cumulative, and will accrue and be compounded annually, whether or not declared and whether or not there are any profits, surplus or other funds or assets of the Company legally available therefor. Dividends on the Series C and Series D preferred stock may be paid in cash or shares of the Company’s common stock at the option of the holder. Series C and Series D preferred stock does not have redemption rights. Each share of Series C and Series D preferred stock is convertible at the holder’s option into shares of common stock, with Series C stockholders having conversion price of $0.50 per share, and Series D stockholders having conversion price of $0.80 per share, together with accrued and unpaid dividends payable, at the option of the holder, in cash or shares of common stock based on the conversion price. Given the obligation to settle all dividends, including those in arrears, in cash at the election of the preferred stockholder upon conversion, whether or not declared by the Company, the Company accrues dividends on Series C and D preferred stock as a liability in its consolidated financial statements.

In the event of liquidation, dissolution or winding up of the Company, the holders of Series D preferred stock will be entitled to receive, on a pari passu basis with the holders of the Series C preferred stock and in preference to any payment or distribution to holders of the Series B preferred stock and common stock, an amount per share equal to the Stated Value plus the amount of any accrued and unpaid dividends. If, at any time while the Series C and Series D preferred stock is outstanding, the Company effects any reorganization, merger or consolidation of the Company, sale of substantially all of its assets, or other specified transaction (each, as defined in the Series C and the Series D Certificates of Designation, a “Fundamental Transaction”), a holder of Series C and Series D preferred stock will have the right to receive any shares of the acquiring corporation or other consideration it would have been entitled to receive if it had been a holder of the number of shares of common stock then issuable upon conversion in full of the Series C and Series D preferred stock immediately prior to the Fundamental Transaction. Except as otherwise provided in the Series C and Series D Certificates of Designation or as otherwise required by law, the Series C and Series D preferred stock have no voting rights.

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Convertible Notes and Accrued Interest


	November 30, 2022						May 31, 2022
(in thousands)	April 2, 2021 Note		April 23, 2021 Note		Total		April 2, 2021 Note		April 23, 2021 Note		Total
Convertible notes payable outstanding principal	$	9,319	$	28,500	$	37,819	$	9,819	$	28,500	$	38,319
Less: Unamortized debt discount and issuance costs		(198)		(690)		(888)		(512)		(1,566)		(2,078)
Convertible notes payable, net		9,121		27,810		36,931		9,307		26,934		36,241
Accrued interest on convertible notes		3,242		5,037		8,279		2,599		3,375		5,974
Outstanding convertible notes payable, net and accrued interest	$	12,363	$	32,847	$	45,210	$	11,906	$	30,309	$	42,215

Reconciliation of changes to the outstanding balance of convertible notes, including accrued interest, were as follows:


(in thousands)	April 2, 2021 Note		April 23, 2021 Note		Total
Outstanding balance at May 31, 2022	$	11,906	$	30,309	$	42,215
Amortization of issuance discount and costs		314		876		1,190
Interest expense		643		1,662		2,305
Fair market value of shares exchanged for repayment		(638)		-		(638)
Difference between market value of common shares and reduction of principal		138		-		138
Outstanding balance at November 30, 2022	$	12,363	$	32,847	$	45,210

Long-term Convertible Note – April 2, 2021 Note

On April 2, 2021, the Company entered into a securities purchase agreement pursuant to which the Company issued a secured convertible promissory note with a two-year term in the initial principal amount of $28.5 million (the “April 2, 2021 Note”). The Company received consideration of $25.0 million, reflecting an original issue discount of $3.4 million and issuance costs of $0.1 million. Interest accrues at an annual rate of 10% on the outstanding balance, with the rate increasing to the lesser of 22% per annum or the maximum rate permitted by applicable law upon occurrence of an event of default. In addition, upon any event of default, the investor may accelerate the outstanding balance payable under the April 2, 2021 Note; upon such acceleration, the outstanding balance will increase automatically by 15%, 10% or 5%, depending on the nature of the event of default. The events of default are listed in Section 4 of the April 2, 2021 Note filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on April 8, 2021. The April 2, 2021 Note is secured by all the assets of the Company, excluding the Company’s intellectual property.

Pursuant to the terms of the April 2, 2021 Note, the Company must obtain the investor’s consent before assuming additional debt with aggregate net proceeds to the Company of less than $50.0 million. In the event of any such approval, the outstanding principal balance of the April 2, 2021 Note will increase automatically by 5% upon the issuance of such additional debt. The investor may convert all or any part the outstanding balance of the April 2, 2021 note into shares of common stock at an initial conversion price of $10.00 per share upon five trading days’ notice, subject to certain adjustments and volume and ownership limitations. In addition to standard anti-dilution adjustments, the conversion price of the April 2, 2021 Note is subject to full-ratchet anti-dilution protection, pursuant to which the conversion price will be automatically reduced to equal the effective price per share in any new offering by the Company of equity securities that have registration rights, are registered or become registered under the Securities Act of 1933, as amended (the “Securities Act”). The April 2, 2021 Note provides for liquidated damages upon failure to deliver common stock within specified timeframes and requires the Company to maintain a share reservation of 6.0 million shares of common stock. The investor may redeem any portion of the note, at any time beginning six months after the issue date upon three trading days’ notice, subject to a maximum monthly redemption amount of $3.5 million. The April 2, 2021 Note requires the Company to satisfy its redemption obligations in cash within three trading days of the Company’s receipt of such notice. The Company may prepay the outstanding balance of the note, in part or in full, plus a 15% premium, at any time upon 15 trading days’ notice.

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Pursuant to the terms of the April 2, 2021 Note, the Company is obligated, at the discretion of the noteholder, to reduce the outstanding balance by $7.5 million per month for five months. During fiscal year 2022, in partial satisfaction of debt reduction amounts, the Company and the April 2, 2021 Note holder entered into exchange agreements, pursuant to which the April 2, 2021 Note was partitioned into new notes (the “Partitioned Notes”) with an aggregate principal amount of $18.7 million, which were exchanged concurrently with the issuance of approximately 25.3 million shares of common stock. The outstanding balance of the April 2, 2021 Note was reduced by the Partitioned Notes to a principal amount of $9.8 million. The Company accounted for the restructured partitioned notes and exchange settlements as induced conversion, and, accordingly, recorded an aggregate loss on convertible debt induced conversion of $18.8 million through May 31, 2022.

During the three months ended November 30, 2022, in satisfaction of a redemption, the Company and the April 2, 2021 Note holder entered into an exchange agreement, pursuant to which the April 2, 2021 Note was partitioned into a new note (the “November Partitioned Note”) with a principal amount of $0.5 million, which was exchanged concurrently with the issuance of approximately 1.8 million shares of common stock. The outstanding balance of the April 2, 2021 Note was reduced by the November Partitioned Note to a principal amount of $9.3 million. The Company accounted for the November Partitioned Note and exchange settlement as an induced conversion, and, accordingly, recorded a non-cash loss on convertible debt induced conversion of $0.6 million for the three months ended November 30, 2022. For the six months ended November 30, 2022 and 2021, the Company recorded $0.6 million and $6.8 million, respectively, in loss on convertible debt induced conversion.

Long-term Convertible Note – April 23, 2021 Note

On April 23, 2021, the Company entered into a securities purchase agreement pursuant to which the Company issued a secured convertible promissory note with a two-year term to an institutional accredited investor affiliated with the holder of the April 2, 2021 Note in the initial principal amount of $28.5 million (the “April 23, 2021 Note”). The Company received consideration of $25.0 million, reflecting an original issue discount of $3.4 million and issuance costs of $0.1 million. Interest accrues at an annual rate of 10% on the outstanding balance of the April 23, 2021 Note, with the rate increasing to the lesser of 22% per annum or the maximum rate permitted by applicable law upon the occurrence of an event of default. In addition, upon any event of default, the investor may accelerate the outstanding balance payable under the April 23, 2021 Note; upon such acceleration, the outstanding balance will increase automatically by 15%, 10% or 5%, depending on the nature of the event of default. The events of default are listed in Section 4 of the April 23, 2021 Note filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on April 29, 2021. The April 23, 2021 Note is secured by all the assets of the Company, excluding the Company’s intellectual property.

Pursuant to the terms of the April 23, 2021 Note, the Company must obtain the investor’s consent before assuming additional debt with aggregate net proceeds to the Company of less than $75.0 million. In the event of any such approval, the outstanding principal balance of the April 23, 2021 Note will increase automatically by 5% upon the issuance of such additional debt. The investor may convert all or any part of the outstanding balance into shares of common stock at an initial conversion price of $10.00 per share upon five trading days’ notice, subject to certain adjustments and volume and ownership limitations specified in the April 23, 2021 Note. In addition to standard anti-dilution adjustments, the conversion price of the April 23, 2021 Note is subject to full-ratchet anti-dilution protection, pursuant to which the conversion price will be automatically reduced to equal the effective price per share in any new offering by the Company of equity securities that have registration rights, are registered or become registered under the Securities Act. The April 23, 2021 Note provides for liquidated damages upon failure to deliver common stock within specified timeframes and requires the Company to maintain a share reservation of 6.0 million shares of common stock. The investor may redeem any portion of the April 23, 2021 Note, at any time beginning six months after the issue date, upon three trading days’ notice, subject to a maximum monthly redemption amount of $7.0 million. The April 23, 2021 Note requires the Company to satisfy its redemption obligations in cash within three trading days of the Company’s receipt of such notice. The Company may prepay the outstanding balance of the April 23, 2021 Note, in part or in full, plus a 15% premium, at any time upon 15 trading days’ notice.

The holders of the April 2 and April 23 Notes waived provisions in the notes that could have triggered the imposition of a default interest rate, a downward adjustment of the conversion price, or specified other provisions relating to default, breach or imposition of a penalty. The related events included the grant of registration rights to

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investors in specified private offerings, the issuance of warrants to purchase up to 45 million shares of common stock with registration rights to certain parties and potential incurrence of debt pursuant to a Surety Bond Backstop Agreement, and the grant of a security interest in the Company’s intellectual property to certain parties to the Surety Bond Backstop Agreement. Refer to Note 6, Equity Awards and Warrants.

Note 6. Equity Awards and Warrants

Approval of Increase in Authorized Common Stock

On August 31, 2022, at a special stockholders’ meeting, the Company’s stockholders approved a proposal to increase the total number of authorized shares of common stock from 1.0 billion shares to 1.35 billion shares.

Liability Classified Warrants

From June 24, 2022 through August 31, 2022, the Company had insufficient authorized common stock to reserve for the shares underlying the Surety Backstop warrants and warrants issued to a placement agent in connection with the June 2022 offering (Refer to Private Placement of Warrants under Surety Bond Backstop Agreement and Private Placement of Common Stock and Warrants through Placement Agent sections below.) After approval by the Company’s stockholders of an increase to the Company’s authorized common stock, on August 31, 2022, sufficient shares were authorized to cover the shares underlying the warrants. Given that the Company did not have a sufficient number of authorized shares for the instruments at the time they were issued, the Company accounted for such warrants issued from June 24, 2022 through August 2022 as liability classified warrants consistent with ASC 815, Derivatives and Hedging.

In accordance with the prescribed accounting guidance, the Company measured fair value of liability classified warrants using fair value hierarchy which include:

Level 1. Quoted prices in active markets for identical assets or liabilities.

Level 2.

Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less active markets), or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities. Level 2 inputs also include non-binding market consensus prices that can be corroborated with observable market data, as well as quoted prices that were adjusted for security-specific restrictions.

Level 3.

Unobservable inputs to the valuation methodology are significant to the measurement of the fair value of assets or liabilities. These Level 3 inputs also include non-binding market consensus prices or non-binding broker quotes that the Company was unable to corroborate with observable market data.

As of August 31, 2022, in accordance with ASC 815, Derivatives and Hedging, the Company reclassified the warrants to equity upon the increase in the Company’s authorized common stock. The Company recorded a loss on derivatives of approximately $8.6 million in the quarter ended August 31, 2022 due to change in fair market value of the liability classified warrants between June 24 and August 31, 2022. The table below presents a reconciliation of the beginning and ending balances for liabilities measured at fair value as of May 31, 2022, and during the three months ended August 31, 2022:

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(in thousands)		Liability Classified Warrants
Balance at May 31, 2022	$	—
Classified as liability due to lack of shares availability at issuance		14,522
Classified as equity upon increase in availability		(23,123)
Loss on derivative due to change in fair market value		8,601
Balance at August 31, 2022	$

Boards:

Quotes:

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