Cellectar Biosciences, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

6 Months Ended

Jun. 30, 2018

Subsequent Events [Abstract]

Subsequent Events [Text Block]

9. SUBSEQUENT EVENTS

Underwritten Public Offering

On July 31, 2018, the Company sold 1,355,000 shares of common stock, 1,114 shares of Series C Convertible Preferred Stock (the “Series C Preferred Stock”) convertible into 2,785,000 shares of common stock and Series E warrants to purchase 4,140,000 shares of common stock. The public offering price of a share of common stock together with a Series E warrant to purchase one share of common stock was $4.00. The public offering price of a share of Series C Preferred Stock, each of which is convertible into 2,500 shares of Common Stock, together with a Series E warrant to purchase 2,500 shares of common stock was $10,000. The Series E warrants have an exercise price of $4.00 per share and are exercisable until July 31, 2023. Gross offering proceeds to the Company were $16.56 million, with net proceeds to the Company of approximately $14.9 million after deducting underwriting discounts and commissions and related offering expenses

The Series C Preferred Stock includes a beneficial ownership blocker but has no dividend rights (except to the extent that dividends are also paid on the common stock), liquidation preference or other preferences over common stock, and subject to limited exceptions, has no voting rights. As of August 7, 2018,

176

shares of Series C Preferred Stock were converted into

440,000

shares of common stock.

The following pro forma summary information reflects the Company’s unaudited balance sheet as if the underwritten public offering closed on June 30, 2018.

The Company is evaluating the proper accounting treatment for the classification of the Series E Warrants and the allocation of proceeds between common stock, the Series C Preferred Stock, and Additional paid-in capital. All proceeds are included in common stock and additional paid in capital on a pro forma basis

CELLECTAR BIOSCIENCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	As Reported June 30, 2018 (Unaudited)			Pro Forma June 30, 2018 (Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	4,180,744		$	19,068,667
Restricted cash		55,000			55,000
Prepaid expenses and other current assets		780,559			780,559
Total current assets		5,016,303			19,904,226
FIXED ASSETS, NET		211,970			211,970
GOODWILL		1,675,462			1,675,462
OTHER ASSETS		93,086			93,086
TOTAL ASSETS	$	6,996,821		$	21,884,744

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued liabilities		2,093,646			2,093,646
Derivative liability		152,000			152,000
Capital lease obligations, current portion		3,203			3,203
Deferred rent		40,438			40,438
Total current liabilities		2,289,287			2,289,287
LONG-TERM LIABILITIES:
Capital lease obligation, less current portion		568			568
Total long-term liabilities		568			568
TOTAL LIABILITIES		2,289,855			2,289,855
COMMITMENTS AND CONTINGENCIES (Note 8)
STOCKHOLDERS’ EQUITY:
Preferred stock, $0.00001 par value; 7,000 shares Series C authorized; none actual; 1,114 pro forma		—			—
Common stock, $0.00001 par value; 80,000,000 shares authorized; 1,774,992 actual; 3,129,992 pro forma		17			31
Additional paid-in capital		95,452,779			110,340,688
Accumulated deficit		(90,745,830	)		(90,745,830	)
Total stockholders’ equity		4,706,966			19,594,889
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	6,996,821		$	21,884,744

CLR 131 Supply

On August 7, 2018, the Company was informed by Centre for Probe Development and Commercialization (“CPDC”), the Company’s sole supplier of CLR 131, that it is subject to an Import Alert 66-40 (the “Import Alert”) by the United States Food and Drug Administration (“FDA”). While the basis for the Import Alert was not related to CLR 131, or CPDC’s production facility associated with CLR 131, CPDC informed the Company on August 8, 2018 that CPDC would not be able to supply CLR 131 to the Company until the Import Alert is lifted or alternative agreements are reached with the FDA. The Company intends to work with CPDC to resolve this issue as soon as practical. As a result of the supply disruption, the Company expects delays in enrollment in its ongoing clinical trials. At this time, the Company is not able to assess the extent of the delays or what impact the supply disruption will have on the Company, but the inability of CPDC to supply CLR 131 on a prolonged basis would result in further delayed patient enrollment in current and planned clinical trials for CLR 131.