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 June 30, 2023

☐	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: 001-15911

Imunon, Inc.

(Exact name of Registrant as specified in its charter)

Delaware		52-1256615
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

997 Lenox Drive, Suite 100,

Lawrenceville, NJ 08648

(Address of principal executive offices)

(609) 896-9100

(Registrant’s telephone number, including area code)

(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
Common stock, par value $0.01 per share		IMNN		Nasdaq Capital Market

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, 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 (Check One):

	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 August 7, 2023, the Registrant had 9,367,855 shares of common stock, $0.01 par value per share, outstanding.

IMUNON, INC.

QUARTERLY REPORT ON

FORM 10-Q

TABLE OF CONTENTS

		Page(s)
PART I: FINANCIAL INFORMATION

Item 1.	Financial Statements	1
	Condensed Consolidated Balance Sheets as of June 30, 2023 (Unaudited) and December 31, 2022	1
	Condensed Consolidated Statements of Operations (Unaudited) for the Three and Six Months Ended June 30, 2023 and 2022	3
	Condensed Consolidated Statements of Comprehensive Loss (Unaudited) for the Three and Six Months Ended June 30, 2023 and 2022	4
	Condensed Consolidated Statements of Cash Flows (Unaudited) for the Six Months Ended June 30, 2023 and 2022	5
	Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) for the Three Months Ended June 30, 2023 and 2022	7
	Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) for the Six Months Ended June 30, 2023 and 2022	8
	Notes to the Condensed Consolidated Financial Statements (Unaudited)	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	38

Item 4.	Controls and Procedures	38

PART II: OTHER INFORMATION		39

Item 1.	Legal Proceedings	39

Item 1A.	Risk Factors	39

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39

Item 3.	Defaults Upon Senior Securities	39

Item 4.	Mine Safety Disclosures	39

Item 5.	Other Information	39

Item 6.	Exhibits	40

SIGNATURES		41

Cautionary Note Regarding Forward-Looking Statements

This report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical fact are “forward-looking statements” for purposes of this Quarterly Report on Form 10-Q, including, without limitation, any projections of earnings, revenue or other financial items, any statements of the plans and objectives of management for future operations (including, but not limited to, pre-clinical development, clinical trials, manufacturing and commercialization), uncertainties and assumptions regarding the impact of the COVID-19 pandemic on our business, operations, clinical trials, supply chain, strategy, goals and anticipated timelines, any statements concerning proposed drug candidates, potential therapeutic benefits, or other new products or services, any statements regarding future economic conditions or performance, any changes in the course of research and development activities and in clinical trials, any possible changes in cost and timing of development and testing, capital structure, financial condition, working capital needs and other financial items, and any statements of assumptions underlying any of the foregoing. In some cases, forward-looking statements can be identified using terminology such as “may,” “will,” “expects,” “plans,” “anticipates,” “estimates,” “potential” or “continue,” or the negative thereof or other comparable terminology. Although we believe that our expectations are based on reasonable assumptions within the bounds of our knowledge of our industry, business, and operations, we cannot guarantee that actual results will not differ materially from our expectations.

Our future financial condition and results of operations, as well as any forward-looking statements, are subject to inherent risks and uncertainties, including, but not limited to, the inherent uncertainty in the drug development process, our ability to raise additional capital to fund our planned future operations, our ability to obtain or maintain FDA and foreign regulatory approvals for our drug candidates, potential impact of the outbreak, duration and severity of the COVID-19 pandemic on our business, our ability to enroll patients in our clinical trials, risks relating to third parties conduct of our clinical trials, risks relating to government, private health insurers and other third-party payers coverage or reimbursement, risks relating to commercial potential of a drug candidate in development, changes in technologies for the treatment of cancer, impact of development of competitive drug candidates by others, risks relating to intellectual property, volatility in the market price of our common stock, potential inability to maintain compliance with The Nasdaq Marketplace Rules and the impact of adverse capital and credit market conditions. These and other risks, assumptions are described in Item 1A. Risk Factors in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, and in other documents that we file or furnish with the SEC. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. All forward-looking statements speak only as of the date they are made, and we do not intend to update any forward-looking statements, except as required by law or applicable regulations. We operate in a highly competitive, highly regulated, and rapidly changing environment and our business is in a state of evolution. Therefore, it is likely that new risks will emerge, and that the nature and elements of existing risks will change, over time. It is not possible for management to predict all such risk factors or changes therein, or to assess either the impact of all such risk factors on our business or the extent to which any individual risk factor, combination of factors, or new or altered factors, may cause results to differ materially from those contained in any forward-looking statement.

Except where the context otherwise requires, in this Quarterly Report on Form 10-Q, the “Company,” “Imunon,” “we,” “us,” and “our” refer to Imunon, Inc., a Delaware corporation and its wholly owned subsidiaries.

Trademarks

The Company’s brand and product names contained in this document are trademarks, registered trademarks, or service marks of Imunon, Inc. or its subsidiary in the United States (“U.S.”) and certain other countries. This document also contains references to trademarks and service marks of other companies that are the property of their respective owners.

PART I: FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

IMUNON, INC.

CONDENSED CONSOLIDATED

BALANCE SHEETS

	June 30, 2023		December 31, 2022
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	6,611,357	$	11,492,841
Investment in debt securities - available for sale, at fair value		17,400,025		21,254,485
Accrued interest receivable on investment securities		80,489		128,932
Money market investments, restricted cash		-		1,500,000
Advances and deposits on clinical programs and other current assets		2,640,081		2,778,433
Total current assets		26,731,952		37,154,691

Property and equipment (at cost, less accumulated depreciation and amortization)		651,231		548,301

Other assets:
Money market investments, restricted cash		-		4,500,000
Deferred income tax asset		-		1,567,026
Operating lease right-of-use assets, net		1,288,511		155,876
Deposits and other assets		50,000		50,000
Total other assets		1,338,511		6,272,902

Total assets	$	28,721,694	$	43,975,894

See accompanying notes to the unaudited condensed consolidated financial statements.

IMUNON, INC.

CONDENSED CONSOLIDATED

BALANCE SHEETS

(Continued)

	June 30, 2023			December 31, 2022
	(Unaudited)
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable – trade	$	2,612,440		$	3,586,623
Other accrued liabilities		3,233,193			4,794,936
Note payable – current portion, net of deferred financing costs		-			1,424,774
Operating lease liabilities - current portion		278,409			230,749
Total current liabilities		6,124,042			10,037,082

Notes payable – non-current portion, net of deferred financing costs		-			4,610,946
Operating lease liabilities - non-current portion		1,082,512			-
Total liabilities		7,206,554			14,648,028

Commitments and contingencies		-			–

Stockholders’ equity:

Preferred stock - $0.01 par value (100,000 shares authorized, and no shares issued or outstanding at June 30, 2023 and December 31, 2022)		-			–

Common stock - $0.01 par value (112,500,000 shares authorized; 9,252,003 and 7,436,219 shares issued at June 30, 2023 and December 31, 2022, respectively; 9,251,981 and 7,436,197 shares outstanding at June 30, 2023 and December 31, 2022, respectively)		92,520			74,362
Additional paid-in capital		401,163,818			397,980,023
Accumulated other comprehensive loss		162,045			26,494
Accumulated deficit		(379,818,055	)		(368,667,825	)
Total stockholders’ equity before treasury stock		21,600,328			29,413,054

Treasury stock, at cost (22 shares at June 30, 2023 and December 31, 2022)		(85,188	)		(85,188	)
Total stockholders’ equity		21,515,140			29,327,866

Total liabilities and stockholders’ equity	$	28,721,694		$	43,975,894

See accompanying notes to the unaudited condensed consolidated financial statements.

IMUNON, INC.

CONDENSED CONSOLIDATED

STATEMENTS OF OPERATIONS

(Unaudited)

	2023			2022			2023			2022
	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2023			2022			2023			2022

Licensing revenue	$	-		$	125,000		$	-		$	250,000

Operating expenses:
Research and development		3,134,399			3,226,295			5,754,204			6,321,715
General and administrative		2,339,886			2,876,976			5,404,531			5,748,533
Total operating expenses		5,474,285			6,103,271			11,158,735			12,070,248

Loss from operations		(5,474,285	)		(5,978,271	)		(11,158,735	)		(11,820,248	)

Other (expense) income:
Investment income		281,673			40,355			534,743			52,459
Interest expense		(37,095	)		(105,024	)		(197,080	)		(4,751,281	)
Loss on extinguishment of debt		(329,158	)		-			(329,158	)		-
Other income		-			3			-			1,801
Total other (expense) income, net		(84,580	)		(64,666	)		8,505			(4,697,021	)

Net loss	$	(5,558,865	)	$	(6,042,937	)	$	(11,150,230	)	$	(16,517,269	)

Net loss per common share
Basic and diluted	$	(0.61	)	$	(0.87	)	$	(1.28	)	$	(2.59	)

Weighted average shares outstanding
Basic and diluted		9,136,573			6,981,970			8,711,389			6,372,908

See accompanying notes to the unaudited condensed consolidated financial statements.

IMUNON, INC.

CONDENSED CONSOLIDATED

STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited)

	2023			2022			2023			2022
	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2023			2022			2023			2022
Other comprehensive loss

Changes in:
Realized gains on debt securities recognized in investment income, net	$	33,172		$	21,596		$	136,257		$	23,934
Unrealized gains (losses) on debt securities, net		4,996			(32,652	)		(705	)		(85,994	)

Change in realized and unrealized gains (losses) on available for sale securities, net		38,168			(11,056	)		135,552			(62,060	)

Net loss		(5,558,865	)		(6,042,937	)		(11,150,230	)		(16,517,269	)

Total comprehensive loss	$	(5,520,697	)	$	(6,053,993	)	$	(11,014,678	)	$	(16,579,329	)

See accompanying notes to the unaudited condensed consolidated financial statements.

IMUNON, INC.

CONDENSED CONSOLIDATED

STATEMENTS OF CASH FLOWS

(Unaudited)

	2023			2022
	For the Six Months Ended June 30,
	2023			2022
Cash flows from operating activities:

Net loss	$	(11,150,230	)	$	(16,517,269	)

Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		108,482			81,371
Amortization of right-of-use assets		272,675			260,583
Recognition of deferred revenue		-			(250,000	)
Realized and unrealized gains (losses), net, on investment securities		135,551			(62,060	)
Stock-based compensation		529,027			1,486,522
Realization of deferred income tax asset		1,567,026			1,383,446
Loss on extinguishment of debt		329,158			-
Amortization of deferred finance charges and debt discount associated with notes payable		55,122			90,630
Net changes in:
Accrued interest receivable on investment securities		48,443			79,116
Advances, deposits, and other current assets		138,352			(195,429	)
Accounts payable and accrued liabilities		(2,811,064	)		193,984
Net cash used in operating activities		(10,777,458	)		(13,449,106	)

Cash flows from investing activities:
Purchases of investment securities		(3,645,540	)		(8,343,385	)
Proceeds from sale and maturity of investment securities		7,500,000			22,775,000
Purchases of property and equipment		(211,412	)		(166,022	)
Net cash provided by investing activities		3,643,048			14,265,593

Cash flows from financing activities:
Proceeds from redeemable convertible preferred stock offering		-			28,500,000
Payment upon redemption of redeemable convertible preferred stock		-			(28,500,000	)
Proceeds from sale of common stock equity, net of issuance costs		2,672,926			6,339,369
Payoff of the SVB loan and accrued end-of-term fees		(6,420,000	)		-
Net cash (used in) provided by financing activities		(3,747,074	)		6,339,369

Net change in cash, cash equivalents and restricted cash		(10,881,484	)		7,155,856
Cash, cash equivalents and restricted cash at beginning of period		17,492,841			25,586,272
Cash, cash equivalents and restricted cash at end of period	$	6,611,357		$	32,742,128

See accompanying notes to the unaudited condensed consolidated financial statements.

IMUNON, INC.

CONDENSED CONSOLIDATED

STATEMENTS OF CASH FLOWS (continued)

(Unaudited)

	2023			2022
	For the Six Months Ended June 30,
	2023			2022

Supplemental disclosures of cash flow information:
Interest paid	$	(179,542	)	$	(4,267,107	)
Recognition of right of use asset and liability	$	1,405,310		$	-

Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows for lease payments	$	340,457		$	299,947

See accompanying notes to the unaudited condensed consolidated financial statements.

IMUNON, INC.

CONDENSED CONSOLIDATED

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

FOR THE THREE MONTHS ENDED JUNE 30, 2023 AND 2022

		Shares		Amount		Capital		Shares		Amount			(Loss)		Deficit			Total
		Common Stock Outstanding				Additional Paid-in		Treasury Stock					Accum. Other Compr. Income		Accumulated
		Shares		Amount		Capital		Shares		Amount			(Loss)		Deficit			Total

Balance at April 1, 2023	-		9,097,027	$	90,970	$	400,776,487		22	$	(85,188	)	$	123,877	$	(374,259,190	)	$	26,646,956

Net loss			-		-		-		-		-			-		(5,558,865	)		(5,558,865	)

Sale of equity through equity financing facilities			154,976		1,550		197,012		-		-			-		-			198,562

Realized and unrealized gains and losses, net, on investment securities	-		-		-		-		-		-			38,168		-			38,168

Stock-based compensation expense			-		-		190,319		-		-			-		-			190,319
Balance at June 30, 2023	-		9,252,003	$	92,520	$	401,163,818		22	$	(85,188	)	$	162,045	$	(379,818,055	)	$	21,515,140

		Common Stock Outstanding				Additional Paid-in		Treasury Stock						Accum. Other Compr. Income			Accumulated
		Shares		Amount		Capital		Shares		Amount				(Loss)			Deficit			Total

Balance at April 1, 2022	-		5,770,467	$	57,705	$	389,595,593		22		$	(85,188	)	$	(58,978	)	$	(343,243,923	)	$	46,265,209

Net loss			-		-		-		-			-			-			(

SEC Form 10-Q filed by Celsion Corporation