v3.26.3
RESTATEMENT OF PREVIOUSLY ISSUED UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 6 Months Ended
Jun. 30, 2026
Accounting Changes and Error Corrections [Abstract]  
RESTATEMENT OF PREVIOUSLY ISSUED UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 18. RESTATEMENT OF PREVIOUSLY ISSUED UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Restatement Background

On September 16, 2026, the Company's management, upon the recommendation of the Audit Committee of the Board of Directors, concluded that the Company’s previously issued unaudited interim condensed consolidated financial statements as of and for the three and six months ended June 30, 2026 should no longer be relied upon due to an error described below, and that such financial statements should be restated. The Company evaluated the materiality of the error both qualitatively and quantitatively in accordance with Staff Accounting Bulletin (“SAB”) No. 99, Materiality and SAB No. 108, Considering the Effects of Prior Year Misstatements in Current Year Financial Statements, and determined the effect of the correction was material as of and for the three and six months ended June 30, 2026, and as a result, the Company is restating the unaudited interim condensed consolidated financial statements as of and for the three and six months ended June 30, 2026, in accordance with ASC 250, Accounting Changes and Error Corrections.

We have determined that the error was a result of a material weakness in internal control over financial reporting that is reported in management’s report on internal control over financial reporting included in Item 4 of this report.

This restatement of the Company’s previously issued unaudited interim condensed consolidated financial statements as of and for the three and six months ended June 30, 2026, corrects a misstatement resulting from the omission of the value of certain assets from the calculation of the fair value of the Tekne Convertible Note Receivable, as defined and described in Note 6 to the condensed consolidated financial statements, which is accounted for under the fair value option.

The restatement had no impact on total net cash flows from operating, investing or financing activities.

 

Condensed Consolidated Balance Sheet

 

 

 

As of June 30, 2026

 

 

 

Originally Reported

 

 

Adjustment

 

 

As
Restated

 

ASSETS

 

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

 

Tekne Convertible Note Receivable

 

$

23,116,321

 

 

$

761,001

 

 

$

23,877,322

 

Total current assets

 

$

31,195,561

 

 

$

761,001

 

 

$

31,956,562

 

TOTAL ASSETS

 

$

68,361,108

 

 

$

761,001

 

 

$

69,122,109

 

LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)

 

 

 

 

 

 

 

 

 

Stockholders’ Equity (Deficit)

 

 

 

 

 

 

 

 

 

Accumulated deficit

 

$

(207,415,591

)

 

$

761,001

 

 

$

(206,654,590

)

Total Stockholders’ Equity

 

$

9,369,319

 

 

$

761,001

 

 

$

10,130,320

 

TOTAL LIABILITIES, TEKNE SUBORDINATED CONVERTIBLE NOTE AND STOCKHOLDERS’ EQUITY

 

$

68,361,108

 

 

$

761,001

 

 

$

69,122,109

 

 

Condensed Consolidated Statement of Operations

 

 

 

Three Months Ended June 30, 2026

 

 

 

Originally Reported

 

 

Adjustment

 

 

As
Restated

 

Change in fair value of convertible notes receivable

 

$

288,535

 

 

$

761,001

 

 

$

1,049,536

 

Loss before provision for income taxes

 

$

(6,475,862

)

 

$

761,001

 

 

$

(5,714,861

)

Net loss

 

$

(6,475,862

)

 

$

761,001

 

 

$

(5,714,861

)

Comprehensive loss

 

$

(6,441,021

)

 

$

761,001

 

 

$

(5,680,020

)

Net loss available to common shareholders

 

$

(8,049,174

)

 

$

761,001

 

 

$

(7,288,173

)

Net loss per common share, basic and diluted (1)

 

$

(0.04

)

 

$

(1.42

)

 

$

(1.46

)

 

(1)
Net loss per common share as restated reflects the 1-for-40 reverse stock split effected on September 1, 2026, applied retroactively. Of the $(1.42) adjustment, $(1.57) is attributable to the reverse stock split and $0.15 to the correction of the error.

 

 

 

Six Months Ended June 30, 2026

 

 

 

Originally Reported

 

 

Adjustment

 

 

As
Restated

 

Change in fair value of convertible notes receivable

 

$

1,362,338

 

 

$

761,001

 

 

$

2,123,339

 

Loss before provision for income taxes

 

$

(6,935,760

)

 

$

761,001

 

 

$

(6,174,759

)

Net loss

 

$

(6,935,760

)

 

$

761,001

 

 

$

(6,174,759

)

Comprehensive loss

 

$

(6,873,592

)

 

$

761,001

 

 

$

(6,112,591

)

Net loss available to common shareholders

 

$

(8,983,130

)

 

$

761,001

 

 

$

(8,222,129

)

Net loss per common share, basic and diluted (1)

 

$

(0.06

)

 

$

(2.01

)

 

$

(2.07

)
(1)
Net loss per common share as restated reflects the 1-for-40 reverse stock split effected on September 1, 2026, applied retroactively. Of the $(2.01) adjustment, $(2.20) is attributable to the reverse stock split and $0.19 to the correction of the error.

 

Condensed Consolidated Statement of Stockholders' Equity (Deficit)

 

 

 

Three Months Ended June 30, 2026

 

 

 

Originally Reported

 

 

Adjustment

 

 

As
Restated

 

Net loss

 

$

(6,475,862

)

 

$

761,001

 

 

$

(5,714,861

)

Accumulated deficit, balance as of June 30, 2026

 

$

(207,415,591

)

 

$

761,001

 

 

$

(206,654,590

)

 

 

Condensed Consolidated Statement of Cash Flows

 

 

 

Six Months Ended June 30, 2026

 

 

 

Originally Reported

 

 

Adjustment

 

 

As
Restated

 

Net loss

 

$

(6,935,760

)

 

$

761,001

 

 

$

(6,174,759

)

Change in fair value of convertible notes receivable

 

$

(1,362,338

)

 

$

(761,001

)

 

$

(2,123,339

)