cbli20190930

10-Q 1 cbli20210331_10q.htm FORM 10-Q cbli20190930_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended March 31, 2021

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-32954

CLEVELAND BIOLABS, INC.

(Exact name of registrant as specified in its charter)

DELAWARE	20-0077155
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

73 High Street, Buffalo, New York	14203
(Address of principal executive offices)	(Zip Code)

(716) 849-6810

(Registrant’s telephone number, including area code)

N/A

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

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 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 ☒

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common stock, par value $0.005		CBLI		NASDAQ Capital Market

As of April 30, 2021, there were 15,468,945 shares outstanding of the registrant’s common stock, par value $0.005 per share.

		PAGE
PART I – FINANCIAL INFORMATION
ITEM 1.	Consolidated Condensed Financial Statements
	Consolidated Condensed Balance Sheets	3
	Consolidated Condensed Statements of Operations	4
	Consolidated Condensed Statements of Comprehensive Loss	5
	Consolidated Condensed Statement of Stockholders’ Equity	6
	Consolidated Condensed Statements of Cash Flows	7
	Notes to Consolidated Condensed Financial Statements	8
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	19
ITEM 4.	Controls and Procedures	19

PART II – OTHER INFORMATION
ITEM 1.	Legal Proceedings	20
ITEM 1A.	Risk Factors	20
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	20
ITEM 3.	Defaults Upon Senior Securities	20
ITEM 4.	Mine Safety Disclosures	20
ITEM 5.	Other Information	20
ITEM 6.	Exhibits	21
Signatures		22

	March 31, 2021			December 31, 2020
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	14,359,297		$	1,946,418
Short-term investments		264,193			324,870
Accounts receivable		—			11,512
Other current assets		70,120			31,506
Total current assets		14,693,610			2,314,306
Equipment, net		6,148			3,715
Total assets	$	14,699,758		$	2,318,021
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	309,721		$	167,773
Accrued expenses		208,430			136,838
Total liabilities		518,151			304,611
Stockholders’ equity:
Preferred stock, $.005 par value; 1,000,000 shares authorized as of March 31, 2021 and December 31, 2020; 0 shares issued and outstanding as of March 31, 2021 and December 31, 2020		—			—
Common stock, $.005 par value; 25,000,000 shares authorized as of March 31, 2021 and December 31, 2020; 15,468,945 and 13,376,062 shares issued and outstanding as of March 31, 2021 and December 31, 2020		77,340			66,876
Additional paid-in capital		179,475,388			166,762,778
Accumulated other comprehensive loss		(690,864	)		(685,680	)
Accumulated deficit		(169,642,127	)		(169,104,029	)
Total Cleveland BioLabs, Inc. stockholders’ equity (deficit)		9,219,737			(2,960,055	)
Noncontrolling interest in stockholders’ equity		4,961,870			4,973,465
Total stockholders’ equity		14,181,607			2,013,410
Total liabilities and stockholders’ equity	$	14,699,758		$	2,318,021

	For the Three Months Ended
	March 31,
	2021			2020
Revenues:
Grants and contracts	$	-		$	156,042
Operating expenses:
Research and development		118,258			218,208
General and administrative		433,004			382,166
Total operating expenses		551,262			600,374
Loss from operations		(551,262	)		(444,332	)
Other income (expense):
Interest and other income		3,915			2,900
Foreign exchange gain		142			393
Change in value of warrant liability		-			(160,689	)
Total other income (expense)		4,057			(157,396	)
Net loss		(547,205	)		(601,728	)
Net loss attributable to noncontrolling interests		9,107			13,196
Net loss attributable to Cleveland BioLabs, Inc.	$	(538,098	)	$	(588,532	)
Net loss attributable to common stockholders per share of common stock, basic and diluted	$	(0.04	)	$	(0.05	)
Weighted average number of shares used in calculating net loss per share, basic and diluted		14,227,014			11,353,456

									Additional
	Common Stock				Treasury Stock				Paid-In
	Shares		Amount		Shares		Amount		Capital
Balance at December 31, 2019		11,298,239	$	56,487		—	$	—	$	163,161,523
Exercise of warrants		105,000		53		—		—		504,853
Net loss		—		—		—		—		—
Foreign currency translation		—		—		—		—		—
Balance at March 31, 2020		11,403,239	$	56,540		—	$	-	$	163,666,376

Balance at December 31, 2020		13,376,062	$	66,876		—	$	-	$	166,762,778
Exercise of warrants		92,883		464		—		—		(464	)
Net loss		—		—		—		—		—
Foreign currency translation		—		—		—		—		—
Issuance of common stock, net of offering costs		2,000,000		10,000		—		—		12,713,074
Balance at March 31, 2021		15,468,945	$	77,340		—	$	-	$	179,475,388

	Accumulated Other Comprehensive Loss			Accumulated Deficit			Noncontrolling Interests			Total
Balance at December 31, 2019	$	(568,030	)	$	(166,705,572	)	$	5,039,878		$	984,286
Exercise of warrants		—			—			—			504,906
Net loss		—			(588,532	)		(13,196	)		(601,728	)
Foreign currency translation		(74,777	)		—			(33,623	)		(108,100	)
Balance at March 31, 2020	$	(642,807	)	$	(167,294,104	)	$	4,993,059		$	779,364

Balance at December 31, 2020	$	(685,680	)	$	(169,104,029	)	$	4,973,465		$	2,013,410
Exercise of warrants		—			—			—			—
Net loss		—			(538,098	)		(9,107	)		(547,205	)
Foreign currency translation		(5,184	)		—			(2,488	)		(7,672	)
Issuance of common stock, net of offering costs		—			—			—			12,723,074
Balance at March 31, 2021	$	(690,864	)	$	(169,642,127	)	$	4,961,870		$	14,181,607

	For the Three Months Ended March 31,
	2021			2020
Cash flows from operating activities:
Net loss	$	(547,205	)	$	(601,728	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		1,883			3,080
Change in value of warrant liability		—			160,689
Changes in operating assets and liabilities:
Accounts receivable and other current assets		(27,227	)		8,074
Accounts payable and accrued expenses		209,456			4,292
Net cash used in operating activities		(363,093	)		(425,593	)
Cash flows from investing activities:
Sale of short-term investments		53,807			—
Net cash provided by investing activities		53,807			—
Cash flows from financing activities:
Issuance of common stock, net of offering costs		12,723,074			—
Exercise of warrants		—			382,215
Net cash provided by financing activities		12,723,074			382,215
Effect of exchange rate change on cash and equivalents		(909	)		(23,935	)
Increase (decrease) in cash and cash equivalents		12,412,879			(67,313	)
Cash and cash equivalents at beginning of period		1,946,418			1,126,124
Cash and cash equivalents at end of period	$	14,359,297		$	1,058,811

	Three Months Ended
	March 31,
Customer	2021			2020			Variance
Department of Defense		0.0	%		73.7	%		(73.7	)%
Incuron		0.0	%		26.3	%		(26.3	)%
Total		0.0	%		100.0	%		(100	)%

	Gains and losses on foreign exchange translations
Beginning balance	$	(685,680	)
Other comprehensive income (loss) before reclassifications		(5,184	)
Amounts reclassified from accumulated other comprehensive loss		—
Ending balance	$	(690,864	)

	As of March 31,
Common Equivalent Securities	2021		2020
Warrants		299,519		222,253
Options		67,901		96,397
Total		367,420		318,650

	As of March 31, 2021
	Level 1		Level 2		Level 3		Total
Assets:
Short-term investments	$	—	$	264,193	$	—	$	264,193
Total assets	$	—	$	264,193	$	—	$	264,193

	Total Stock Options Outstanding			Weighted Average Exercise Price per Share
December 31, 2020		76,064		$	27.35
Granted		—			—
Vested		—			—
Forfeited, Canceled		(8,163	)		143.62
March 31, 2021		67,901		$	13.37

	As of March 31, 2021
	Stock Options Outstanding		Vested Stock Options
Quantity		67,901		67,901
Weighted Average Exercise Price	$	13.37	$	13.37
Weighted Average Remaining Contractual Term (in Years)		3.36		3.36
Intrinsic Value	$	86,400	$	86,400

	Number of Warrants			Weighted Average Exercise Price
December 31, 2020		371,340		$	7.28
Granted		150,000			8.75
Exercised		(119,361	)		2.03
Forfeited, Canceled		(102,460	)		20.40
March 31, 2021		299,519		$	5.62

		Three Months Ended March 31,
Funding Source	Program	2021		2020		Variance
DoD	JWMRP Contract (1)	$	-	$	69,011	$	(69,011	)
DoD	PRMRP Contract (2)		-		46,021		(46,021	)
Incuron	Service contract		-		41,010		(41,010	)
		$	-	$	156,042	$	(156,042	)

	As of December 31, 2020
	Level 1		Level 2		Level 3		Total
Assets:
Short-term investments	$	—	$	324,870	$	—	$	324,870
Total assets	$	—	$	324,870	$	—	$	324,870
Accrued warrant liability	$	—	$	—	$	—	$	—

Exhibit Number		Description of Document

3.1		Restated Certificate of Incorporation filed with the Secretary of State of Delaware on March 18, 2010 (Incorporated by reference to Exhibit 3.1 to Form 10-K for the year ended December 31, 2009, filed on March 22, 2010).

3.2		Certificate of Amendment to the Restated Certificate of Incorporation, filed with the Secretary of State of Delaware on June 20, 2013 (Incorporated by reference to Exhibit 3.1 to Form 10-Q for the period ended June 30, 2013, filed on August 9, 2013).

3.3		Certificate of Amendment of Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to Form 8-K filed on January 27, 2015).

3.4		Certificate of Amendment to Restated Certificate of Incorporation, filed with the Secretary of State of Delaware on April 20, 2016 (incorporated by reference to Exhibit 3.4 to Form 10-Q for the period ended March 31, 2016, filed May 16, 2016.

3.5		Certificate of Amendment to Restated Certificate of Incorporation, filed with the Secretary of State of Delaware on April 21, 2017 (incorporated by reference to Exhibit 3.5 to Form 10-Q for the period ended March 31, 2017, filed May 15, 2017.

3.6		Certificate of Designation of Preferences, Rights and Limitations of Series A Convertible Preferred Stock (incorporated by reference to Exhibit 3.1 to Form 8-K filed on February 9, 2015).

3.7		Certificate of Amendment of Certificate of Designation of Preferences, Rights and Limitations of Series A Convertible Preferred Stock (incorporated by reference to Exhibit 3.2 to Form 8-K filed on February 9, 2015).

3.8		Second Amended and Restated By-Laws (Incorporated by reference to Exhibit 3.1 to Form 8-K filed on December 5, 2007).

3.9		Amendment to Second Amended and Restated By-Laws of Cleveland BioLabs, Inc. (Incorporated by reference to Exhibit 3.1 to Form 8-K filed on May 18, 2015).

4.1		Form of Placement Agent Warrant (Incorporated by reference to Exhibit 4.1 to Form 8-K filed on February 23, 2021).

10.1		Form of Securities Purchase Agreement, dated as of February 19, 2021, between Cleveland BioLabs, Inc. and the purchasers named therein (Incorporated by reference to Exhibit 10.1 to Form 8-K filed on February 23, 2021).

31.1*		Rule 13a-14(a)/15d-14(a) Certification of Christopher Zosh.

32.1*		Certification pursuant to 18 U.S.C. Section 1350.

101.1		The following information from CBLI’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, formatted in Extensible Business Reporting Language (XBRL): (i) Consolidated Condensed Balance Sheets as of March 31, 2021 and December 31, 2020; (ii) Consolidated Condensed Statements of Operations for the Three Months Ended March 31, 2021 and 2020; (iii) Consolidated Condensed Statements of Comprehensive Loss for the Three Months Ended March 31, 2021 and 2020; (iv) Consolidated Condensed Statement of Stockholders’ Equity for the Three Months Ended March 31, 2021 and 2020; (v) Consolidated Condensed Statements of Cash Flows for the Three Months Ended March 31, 2021 and 2020; and (vi) Notes to Consolidated Condensed Financial Statements.

*		Filed herewith.

	CLEVELAND BIOLABS, INC.

Dated: May 14, 2021	By:	/s/ CHRISTOPHER ZOSH
		Christopher Zosh
		Vice President of Finance
		(Principal Executive and Principal Financial Officer)

SEC Form 10-Q filed by Cleveland BioLabs, Inc.