Allarity Therapeutics Inc
For the period ended Dec 31, 2023. Filed Mar 8, 2024.
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FY2023 · Filed Mar 8, 2024
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K (the “Annual Report”) contains forward-looking statements that involve substantial risks and uncertainties. We make such forward-looking statements pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act, Section 21E of the Securities Exchange Act of 1934, as amended, and other federal securities laws. All statements, other than statements of historical fact, contained in this Annual Report. including statements regarding our strategy, future preclinical studies and clinical trials, future financial position, projected costs, prospects, plans and objectives of management, are forward-looking statements. The words “anticipate,” “believe,” “contemplate,” “could,” “estimate,” “expect,” “intend,” “seek,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “target,” “aim,” “should,” ‘will” “would,” or the negative of these words or other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these words. Forward-looking statements reflect our current views with respect to future events and are based on assumptions and subject to risks and uncertainties. If one or more of these risk factors or uncertainties materialize, or if any underlying assumptions prove incorrect, our actual results, performance or achievements may vary materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Furthermore, we operate in a competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Annual Report. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Forward-looking statements relating to Allarity in this Annual Report include, but are not limited to, statements about:
| ● | our ability to continue as a going concern as addressed in the independent registered public accounting firm’s report on our audited financial statements for the year ended December 31, 2023, included in this report; |
| ● | our ability to secure immediate substantial funding for our operations, working capital and to pursue our clinical trials. If we are unable to raise capital when needed or on favorable terms, we could be forced to delay, reduce or terminate our operations, product development, other operations or commercialization efforts; |
| ● | on January 26, 2024, we received a Termination Notice from Novartis due to a material breach of our license agreement. Accordingly, under the terms of the Agreement (i) we shall cease all development and commercialization activities with respect to all licensed products; (ii) all rights and licenses granted by Novartis to Allarity shall revert to Novartis; and all liabilities due to Novartis became immediately due and payable in the amount of USD $4,900,000 plus interest; |
| ● | on December 8, 2023, James G. Cullem was terminated as our Chief Executive Officer for cause under his employment agreement. Mr. Cullem has indicated that his termination should be without cause. Any potential dispute with Mr. Cullem could result in substantial costs and be a distraction to our business; |
| ● | our ability to meet the Nasdaq Capital Market (“Nasdaq”) continued listing standards. The listing of our Common Stock on Nasdaq is contingent on our compliance with Nasdaq’s conditions for continued listing. We have a history of non-compliance and currently are not in compliance with the continued listing requirements. Pursuant to a Nasdaq letter dated July 14, 2023, the Company is subject to a panel monitor for a period of one year, which includes continued compliance with the stockholders’ equity requirement and other continued listing requirements. Failure to meet the stockholders’ equity requirement of $2,500,000 will result in immediate delisting, subject to the Company’s right to appeal. On October 27, 2023, we received notification from the Nasdaq Listing Qualifications staff that it intends to delist our Common Stock because the bid price of our Common Stock has closed at less than $1 per share over the previous 30 consecutive business days. On November 16, 2023, we received an additional notification indicating that the Company’s stockholders’ equity as reported in its Quarterly Report on Form 10-Q for the period ended September 30, 2023, did not satisfy the continued listing requirement under Nasdaq Listing Rule 5810(c)(3) which serves as an additional basis for delisting. The Company filed a notice of appeal and is awaiting the results of a February 1, 2024 Nasdaq hearing. In the event our Common Stock is no longer listed for trading on Nasdaq, our trading volume and share price may decrease, and you may have a difficult time selling your shares of Common Stock. In addition, we may experience difficulties in raising capital which would materially adversely affect our operations and financial results. Further, delisting from Nasdaq markets could also have other negative effects, including potential loss of confidence by partners, lenders, suppliers and employees; |
| ● | our ability to maintain effective internal control over financial reporting, disclosures and procedures. If we do not maintain effective internal controls, our ability to record, process and report financial information timely and accurately could be adversely affected and could result in a material misstatement in our financial statements, which could subject us to litigation or investigations, require management resources, increase our expenses, negatively affect investor confidence in our financial statements and adversely impact the trading price of our Common Stock; |
| ● | our plans to develop and commercialize the Company’s drug candidates; |
| ● | our ability to generate any revenue or become profitable; |
| ● | the impact of adjustments to our outstanding warrants because of future dilutive financings resulting in the decrease of exercise price and increase the number of shares of issuable under outstanding warrants, adjustment and exercise of such warrants would result in the material dilution of the percentage ownership of our stockholders and increase the number of shares of Common Stock in the public markets. The perception that such sales could occur could cause our stock price to fall; |
| ● | the initiation, cost, timing, progress and results of our current and future preclinical studies and clinical trials, as well as our research and development programs; |
| ● | the impacts of the ongoing COVID-19 pandemic and related restrictions as they may related to our clinical trials; |
| ● | our estimates regarding expenses, future revenue, capital requirements and needs for additional financing; |
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| ● | the unknown consequences of a request for documents from the SEC; |
| ● | the market price of our common stock has been and may continue to be volatile; |
| ● | our ability to successfully acquire or in-license additional product candidates on reasonable terms; |
| ● | our ability to maintain and establish collaborations or obtain additional funding; |
| ● | our ability to obtain regulatory approval of its current and future drug candidates; |
| ● | our expectations regarding the potential market size and the rate and degree of market acceptance of such drug candidates; |
| ● | our expectations regarding our ability to fund operating expenses and capital expenditure requirements with our existing cash and cash equivalents, and future expenses and expenditures; |
| ● | our ability to perform our contractual obligations we have under the transaction documents for financings relating to our Series A Preferred Stock and bridge loans; |
| ● | our ability to enroll patients in our clinical trials, our clinical development activities; |
| ● | our ability to retain key employees, consultants and advisors; |
| ● | our ability to retain reliable third parties to perform the chemistry work associated with our drug discovery, preclinical activities and to conduct our preclinical studies and clinical trials in a satisfactory manner; |
| ● | our ability to secure reliable on third party manufacturers to produce clinical and commercial supplies of API for our therapeutic candidates; |
| ● | our ability to obtain, maintain, protect and enforce sufficient patent and other intellectual property rights for our therapeutic candidates and technology; |
| ● | our anticipated strategies and our ability to manage our business operations effectively; |
| ● | the impact of governmental laws and regulations; |
| ● | the possibility that we may be adversely impacted by other economic, business, and/or competitive factors; |
| ● | any future currency exchange and interest rates; and |
| ● | other risks and uncertainties indicated in this report, including those set forth in the section titled “Risk Factors” as set forth in this report, which is incorporated herein by reference. |
These forward-looking statements are based on information available as of the date of this report, and current expectations, forecasts and assumptions, and involve a number of risks and uncertainties. We do not assume any obligation to update any forward-looking statements, Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
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