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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q/A

(Amendment No. 1)

 

(Mark One)

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

For the quarterly period ended September 30, 2022

OR

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: 001-41455

 

MAIA BIOTECHNOLOGY, INC.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

83-1495913

( State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

444 West Lake Street, Suite 1700

Chicago, IL

06060

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (312) 416-8592

 

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, $0.0001 par value per share

 

MAIA

 

NYSE American

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 (§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, 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

As of November 8, 2022 the registrant had 10,945,904 shares of common stock, $0.0001 par value per share, outstanding.

 

 

 


 

EXPLANATORY NOTE

 

This Amendment No. 1 on Form 10-Q/A (the “Amendment”) amends the Quarterly Report on Form 10-Q as of and for the three and nine month periods ended September 30, 2022 (the “Original Report”) of MAIA Biotechnology, Inc. (the “Company”), as originally filed with the U.S. Securities and Exchange Commission (the “SEC”) on November 9, 2022.

 

Background of Restatement

 

On February 3, 2023, the audit committee of the board of directors of the Company (the “Audit Committee”) concluded, after discussion with the Company’s management, that it is appropriate to restate the Company’s previously issued unaudited condensed consolidated balance sheet as of September 30, 2022, and unaudited condensed consolidated statements of operations, unaudited condensed consolidated statements of comprehensive loss and unaudited condensed consolidated statements of stockholders’ equity for the three and nine months ended September 30, 2022, and the unaudited condensed consolidated statement of cash flows for the nine months ended September 30, 2022 included in the Company’s previously filed Quarterly Report on Form 10-Q with the SEC (the “Q3 Form 10-Q” and, the financial statements included in the Q3 Form 10-Q, the “Non-Reliance Financial Statements”). Considering the restatement of such financial statements, the Company concluded that the Non-Reliance Financial Statements should no longer be relied upon. This Amendment includes restatements of the Non-Reliance Financial Statements.

 

In connection with SEC pronouncements related to Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”), the Company re-evaluated its accounting for the Issuance of Ratchet shares and warrants to Underwriters in connection with the IPO. As a result, the Company determined that the ratchet shares had improperly been treated as a deemed dividend instead of operating expense and the warrants were improperly classified as equity instead of a liability.

 

Effects of Restatement

 

As a result of the factors described above, the Company has included in this Amendment a restatement of its unaudited condensed consolidated financial statements for the periods affected by the Non-Reliance Financial Statements. See Note 2 to the Notes to Condensed Consolidated Financial Statements included in Part I, Item 1 of this Amendment for additional information on the restatement and the related financial statement effects. These changes do not impact the Company’s cash position.

 

Internal Control Considerations

 

The Company’s management has concluded that in light of the classification error described above, a material weakness exists in the Company’s internal control over financial reporting and that the Company’s disclosure controls and procedures were not effective. For a discussion of management’s consideration of the material weakness identified, see Part I, Item 4, Controls and Procedures of this Amendment.

 

Items Amended in this Form 10-Q/A

 

This Form 10-Q/A presents the Original Report, amended and restated with modifications as necessary to reflect the restatements. The following items have been amended to reflect the restatement:

Part I, Item 1. Financial Statements

Part I, Item 4, Controls and Procedures

Part II, Item 1A. Risk Factors

 

In addition, the Company’s Principal Executive Officer and Principal Financial and Accounting Officer has provided new certifications dated as of the date of this filing in connection with this Form 10-Q/A (Exhibits31.1, 31.2, 32.1 and 32.2).

 

Except as described above, this Form 10-Q/A does not amend, update or change any other items or disclosures in the Original Report and does not purport to reflect any information or events subsequent to the filing thereof. As such, this Form 10-Q/A speaks only as of the date the Original Report was filed, and we have not undertaken herein to amend, supplement or update any

i


 

information contained in the Original Report to give effect to any subsequent events. Accordingly, this Form 10-Q/A should be read in conjunction with our filings made with the SEC subsequent to the filing of the Original Report, including any amendment to those filings.

 

 

 

 

 

 

 

 

 

 

 


2. Table of Contents

 

 

 

Page

PART I.

FINANCIAL INFORMATION

 

Item 1.

Financial Statements (Unaudited)

1

 

Condensed Consolidated Balance Sheets as of September 30, 2022 (as restated) (Unaudited) and December 31, 2021

1

 

Condensed Consolidated Statements of Operations (Unaudited) for the three and nine months ended September 30, 2022 (as restated) and 2021

2

 

Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) for the three and nine months ended September 30, 2022 (as restated) and 2021

3

 

Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) for the three and nine months ended September 30, 2022 (as restated) and 2021

4

 

Condensed Consolidated Statements of Cash Flows (Unaudited) for the nine months ended September 30, 2022 (as restated) and 2021

6

 

Notes to Unaudited Condensed Consolidated Financial Statements (as restated)

7

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

22

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

32

Item 4.

Controls and Procedures

32

PART II.

OTHER INFORMATION

 

Item 1.

Legal Proceedings

34

Item 1A.

Risk Factors

34

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

36

Item 3.

Defaults Upon Senior Securities

36

Item 4.

Mine Safety Disclosures

36

Item 5.

Other Information

36

Item 6.

Exhibits

37

Signatures

38

 

ii


 

 

PART I—FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

MAIA Biotechnology, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

 

 

 

September 30, 2022
(As Restated)

 

 

December 31,
2021

 

 

 

(unaudited)

 

 

 

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash

 

$

14,063,642

 

 

$

10,574,292

 

Prepaid expenses and other current assets

 

 

460,917

 

 

 

54,537

 

Australia research and development incentives receivable

 

 

255,306

 

 

 

43,666

 

Total current assets

 

 

14,779,865

 

 

 

10,672,495

 

Deferred offering costs

 

 

 

 

 

651,582

 

Other assets

 

 

2,800

 

 

 

3,122

 

Total assets

 

$

14,782,665

 

 

$

11,327,199

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

1,019,093

 

 

$

960,401

 

Accrued expenses

 

 

1,437,200

 

 

 

1,185,595

 

Total current liabilities

 

 

2,456,293

 

 

 

2,145,996

 

Warrant liability

 

 

215,705

 

 

 

 

Total current liabilities and long term liabilities

 

 

2,671,998

 

 

 

2,145,996

 

Commitments and contingencies

 

 

 

 

 

 

Stockholders' equity (deficit)

 

 

 

 

 

 

Preferred stock, $0.0001 par value, 30,000,000 and 70,000,000 shares
     authorized at September 30, 2022 and December 31, 2021 respectively,
     
0 shares issued and outstanding

 

 

 

 

Common stock, $0.0001 par value, 70,000,000 and 30,000,000 shares
  authorized at September 30, 2022 and December 31, 2021 respectively,
  
10,945,904 and 7,584,980 shares issued and outstanding at September 30, 2022
  and December 31, 2021, respectively

 

 

1,095

 

 

 

758

 

Additional paid-in capital

 

 

52,222,752

 

 

 

37,618,438

 

Accumulated deficit

 

 

(40,061,534

)

 

 

(28,437,993

)

Accumulated other comprehensive income (loss)

 

 

(51,646

)

 

 

Total stockholders' equity

 

 

12,110,667

 

 

 

9,181,203

 

Total liabilities and stockholders' equity

 

$

14,782,665

 

 

$

11,327,199

 

 

See the accompanying notes to the unaudited condensed consolidated financial statements.

1


 

MAIA Biotechnology, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

 

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

 

 

 

 

 

 

 

2022
(As Restated)

 

 

2021

 

 

2022
(As Restated)

 

 

2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Research and development expenses

 

$

2,343,154

 

 

$

1,081,705

 

 

$

6,539,948

 

 

$

1,988,450

 

General and administrative expenses

 

 

1,653,072

 

 

 

1,151,542

 

 

 

4,341,880

 

 

 

2,798,766

 

Ratchet share expense

 

 

1,099,360

 

 

 

 

 

 

1,099,360

 

 

 

 

Total operating costs and expenses

 

 

5,095,586

 

 

 

2,233,247

 

 

 

11,981,188

 

 

 

4,787,216

 

Loss from operations

 

 

(5,095,586

)

 

 

(2,233,247

)

 

 

(11,981,188

)

 

 

(4,787,216

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(1,716

)

 

 

(451,306

)

 

 

(1,820

)

 

 

(827,539

)

Interest income

 

 

348

 

 

 

708

 

 

 

1,249

 

 

 

1,501

 

Australian research and development
      incentives

 

 

65,111

 

 

 

 

 

 

230,188

 

 

 

 

Change in fair value of embedded
      features

 

 

 

 

 

(96,000

)

 

 

 

 

 

(203,000

)

Change in fair value of warrant liability

 

 

128,030

 

 

 

(100,780

)

 

 

128,030

 

 

 

(1,546,280

)

Loss on extinguishment of convertible
      notes and convertible notes, related
      parties

 

 

 

 

 

(2,322,943

)

 

 

 

 

 

(2,322,943

)

Other income (expense), net

 

 

191,773

 

 

 

(2,970,321

)

 

 

357,647

 

 

 

(4,898,261

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

(4,903,813

)

 

 

(5,203,568

)

 

 

(11,623,541

)

 

 

(9,685,477

)

Net loss attributable to noncontrolling
     interests

 

 

 

 

 

(7,130

)

 

 

 

 

 

(74,331

)

Deemed dividend on warrant
     modification

 

 

 

 

 

 

 

 

(450,578

)

 

 

 

Net loss attributable to MAIA Biotechnology, Inc. shareholders

 

$

(4,903,813

)

 

$

(5,196,438

)

 

$

(12,074,119

)

 

$

(9,611,146

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

$

(0.48

)

 

$

(1.02

)

 

$

(1.39

)

 

$

(2.06

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding Basic and diluted

 

 

10,165,622

 

 

 

5,119,121

 

 

 

8,713,570

 

 

 

4,668,635

 

See the accompanying notes to the unaudited condensed consolidated financial statements.

2


 

MAIA Biotechnology, Inc. and Subsidiaries

Condensed Consolidated Statements of Comprehensive Loss

(Unaudited)

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

 

 

 

 

 

 

 

2022
(As Restated)

 

 

2021

 

 

2022
(As Restated)

 

 

2021

 

Net loss attributable to MAIA Biotechnology, Inc.
         shareholders

 

$

(4,903,813

)

 

$

(5,196,438

)

 

$

(12,074,119

)

 

$

(9,611,146

)

Foreign currency translation adjustment

 

 

(47,501

)

 

 

 

 

 

(51,646

)

 

 

 

Comprehensive loss to MAIA Biotechnology, Inc.
        shareholders

 

$

(4,951,314

)

 

$

(5,196,438

)

 

$

(12,125,765

)

 

$

(9,611,146

)

 

See the accompanying notes to the unaudited condensed consolidated financial statements.

3


 

MAIA Biotechnology, Inc. and Subsidiaries

Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited)

For the three and nine months ended September 30, 2022

 

For the Three and Nine Months Ended

 

September 30, 2022

 

 

 

Preferred Stock

 

 

Common Stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Additional Paid-In Capital (As Restated)

 

 

Accumulated Deficit
(As Restated)

 

 

Accumulated other comprehensive income (loss)

 

 

Total MAIA Equity
(As Restated)

 

 

Noncontrolling Interest

 

 

Total Stockholders' Equity (As Restated)

 

Balance at December 31, 2021

 

 

 

 

$

 

 

 

7,584,980

 

 

$

758

 

 

$

37,618,438

 

 

$

(28,437,993

)

 

$

 

 

$

9,181,203

 

 

$

 

 

$

9,181,203

 

Issuance of common shares upon exercise of stock options

 

 

 

 

 

 

 

 

26,500

 

 

 

3

 

 

 

47,697

 

 

 

 

 

 

 

 

 

47,700

 

 

 

 

 

 

47,700

 

Issuance of common shares upon exercise of warrants

 

 

 

 

 

 

 

 

61,111

 

 

 

6

 

 

 

109,994

 

 

 

 

 

 

 

 

 

110,000

 

 

 

 

 

 

110,000

 

Issuance of common shares in connection with Equity Financing

 

 

 

 

 

 

 

 

263,729

 

 

 

27

 

 

 

2,373,534

 

 

 

 

 

 

 

 

 

2,373,561

 

 

 

 

 

 

2,373,561

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

713,330

 

 

 

 

 

 

 

 

 

713,330

 

 

 

 

 

 

713,330

 

Modification of warrant in equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

450,578

 

 

 

 

 

 

 

 

 

450,578

 

 

 

 

 

 

450,578

 

Deemed dividend on modification of warrant

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(450,578

)

 

 

 

 

 

 

 

 

(450,578

)

 

 

 

 

 

(450,578

)

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,721

 

 

 

1,721

 

 

 

 

 

 

1,721

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3,413,845

)

 

 

 

 

 

(3,413,845

)

 

 

 

 

 

(3,413,845

)

Balance at March 31, 2022

 

 

 

 

 

 

 

 

7,936,320

 

 

 

794

 

 

 

40,862,993

 

 

 

(31,851,838

)

 

 

1,721

 

 

 

9,013,670

 

 

 

 

 

 

9,013,670

 

Issuance of common shares upon exercise warrants

 

 

 

 

 

 

 

 

468,601

 

 

 

47

 

 

 

275,353

 

 

 

 

 

 

 

 

 

275,400

 

 

 

 

 

 

275,400

 

Issuance of common shares in connection with Equity Financing

 

 

 

 

 

 

 

 

11,111

 

 

 

1

 

 

 

99,998

 

 

 

 

 

 

 

 

 

99,999

 

 

 

 

 

 

99,999

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

584,768

 

 

 

 

 

 

 

 

 

584,768

 

 

 

 

 

 

584,768

 

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(5,866

)

 

 

(5,866

)

 

 

 

 

 

(5,866

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3,305,883

)

 

 

 

 

 

(3,305,883

)

 

 

 

 

 

(3,305,883

)

Balance at June 30, 2022

 

 

 

 

 

 

 

 

8,416,032

 

 

 

842

 

 

 

41,823,112

 

 

 

(35,157,721

)

 

 

(4,145

)

 

 

6,662,088

 

 

 

-

 

 

 

6,662,088

 

Issuance of common shares upon exercise of stock options

 

 

 

 

 

 

 

 

10,000

 

 

 

1

 

 

 

17,999

 

 

 

 

 

 

 

 

 

18,000

 

 

 

 

 

 

18,000

 

Issuance of common shares in connection with initial public offering, net of $2,749,905 issuance cost

 

 

 

 

 

 

 

 

2,300,000

 

 

 

230

 

 

 

8,749,865

 

 

 

 

 

 

 

 

 

8,750,095

 

 

 

 

 

 

8,750,095

 

Issuance of ratchet share

 

 

 

 

 

 

 

 

219,872

 

 

 

22

 

 

 

1,099,338

 

 

 

 

 

 

 

 

 

1,099,360

 

 

 

 

 

 

1,099,360

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

532,438

 

 

 

 

 

 

 

 

 

532,438

 

 

 

 

 

 

532,438

 

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(47,501

)

 

 

(47,501

)

 

 

 

 

 

(47,501

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(4,903,813

)

 

 

 

 

 

(4,903,813

)

 

 

 

 

 

(4,903,813

)

Balance at September 30, 2022

 

 

 

 

$

 

 

 

10,945,904

 

 

$

1,095

 

 

$

52,222,752

 

 

$

(40,061,534

)