10-Q

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

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 September 30, 2022;

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

For the transition period from

Commission file number 001-38161

Calyxt, Inc.

(Exact name of registrant as specified in its charter)


Delaware		27-1967997
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

2800 Mount Ridge Road
Roseville, MN		55113-1127
(Address of principal executive offices)		(Zip Code)

(651) 683-2807

(Registrant’s telephone number, including area code)

N/A

(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 (0.0001 par value)	CLXT	The NASDAQ Stock Market LLC (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:

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 2, 2022, there

were 48,841,286 shares

of common stock, $0.0001 par value per share, outstanding.


PART I. FINANCIAL INFORMATION			3
Item 1. Consolidated Financial Statements			3
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			20
Item 3. Quantitative and Qualitative Disclosures About Market Risk			33
Item 4. Controls and Procedures			33
PART II. OTHER INFORMATION			34
Item 1. Legal Proceedings			34
Item 1A. Risk Factors			34
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			36
Item 5. Other Information			36
Item 6. Exhibits			37
SIGNATURE			38

Terms

When the terms the “Company” or “its” are used in this report, unless the context otherwise requires, those terms are being used to refer to Calyxt, Inc. When the term “Cellectis,” is used, it is being used to refer to Cellectis S.A., the Company’s largest stockholder and the former majority owner of its common stock. Cellectis is a clinical-stage biotechnology company employing its core proprietary technologies to develop best-in-class products in the field of immuno-oncology.

The Company owns the names PlantSpring, BioFactory, Plant Cell Matrix, and the abbreviation PCM. The Company also owns the trademarks Calyxt

and Calyno

and owns or licenses other trademarks, trade names, and service marks appearing in this Quarterly Report on Form 10-Q. The names and trademarks Cellectis

and TALEN

, along with any other trademarks, trade names, and service marks of Cellectis appearing in the Company’s Annual Report on Form 10-K are the property of Cellectis. This Quarterly Report on Form 10-Q may contain additional trade names, trademarks, and service marks belonging to other companies. The Company does not intend its use or display of other parties’ trademarks, trade names, or service marks to imply, and such use or display should not be construed to imply a relationship with, or endorsement or sponsorship of these other parties.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the federal securities laws, including 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). The Company may also make forward-looking statements in other reports filed with the Securities and Exchange Commission (SEC), in materials delivered to stockholders, and in press releases. In addition, the Company’s representatives may from time to time make oral forward-looking statements.

The Company has made these forward-looking statements in reliance on the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. In some cases, you can identify these statements by forward-looking words such as “anticipates,” “believes,” “continue,” “estimates,” “expects,” “intends,” “may,” “might,” “plans,” “predicts,” “projects,” “should,” “targets,” “will,” or the negative of these terms and other similar terminology. Forward-looking statements in this report include statements about the Company’s future financial performance, including its liquidity and capital resources, cash runway and its ability to continue as a going concern; its product pipeline and development; its business model and strategies for the development, commercialization and sales of commercial products; commercial demand for its synthetic biology solutions; the development and deployment of its PlantSpring technology platform; its ability to deploy and leverage its artificial intelligence and machine learning (AIML) capabilities; the ability to scale production capability for its BioFactory production system; potential development agreements, partnerships, customer relationships, and licensing arrangements and their contribution to its financial results, cash usage, and growth strategies; the potential impact of the COVID-19 pandemic on its business and operating results; and anticipated trends in its business. These and other forward-looking statements are predictions and projections about future events and trends based on the Company’s current expectations, objectives, and intentions and are premised on current assumptions. The Company’s actual results, level of activity, performance, or achievements could be materially different than those expressed, implied, or anticipated by forward-looking statements due to a variety of factors, including, but not limited to: any adverse impact of the Company’s cost reduction measures and its pursuit and evaluation of a broad range of strategic alternatives on its relationship with employees and third-parties, including ongoing negotiations with potential customers; whether or not the Company is able to identify and consummate an acceptable strategic alternative pursuant to its ongoing exploration of such transactions; the impact of increased competition, including competition from a broader array of synthetic biology companies; competition for customers, partners, and licensees and the successful execution of development and licensing agreements; disruptions at its key facilities, including disruptions impacting its BioFactory production system; flaws in AIML algorithms, insufficiency of data inputs required by such algorithms, and human error in interacting with AIML; changes in customer preferences and market acceptance of its products; changes in market consensus as to what attributes are required for a product to be considered “sustainable”; the impact of adverse events during development, including unsuccessful pilot production of plant-based chemistries or field trials; the impact of improper handling of its product candidates during development; failures by third-party contractors; inaccurate demand forecasting or milestone and royalty payment projections; the effectiveness of commercialization efforts by commercial partners or licensees; disruptions to supply chains, including raw material inputs for its BioFactory; the impact of changes or increases in oversight and regulation; disputes or challenges regarding intellectual property; proliferation and continuous evolution of new technologies; management changes; changes in macroeconomic and market conditions, including inflation, supply chain constraints, and rising interest rates; dislocations in the capital markets and challenges in accessing liquidity and the impact of such liquidity challenges on the Company’s ability to execute on its business plan; the severity and duration of the evolving COVID-19 pandemic and the resulting impact on macro-economic conditions; and other important factors discussed in Part I, Item 1A, “Risk Factors” in the Company’s filings with the SEC, included in Part I, Item 1A of its Annual Report on Form 10-K for the year ended December 31, 2021, which was filed with the SEC on March 3, 2022 (its Annual Report) and its subsequent reports on Forms 10-Q and 8-K filed with the SEC.

Any forward-looking statements made by the Company in this Quarterly Report on Form 10-Q are based only on currently available information and speak only as of the date of this report. Except as otherwise required by securities and other applicable laws, the Company does not assume any obligation to publicly provide revisions or updates to any forward-looking statements, whether as a result of new information, future developments or otherwise, should circumstances change.

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Market Data

Unless otherwise indicated, information contained in this Quarterly Report concerning the Company’s industry and the markets in which it operates is based on information from various sources, including independent industry publications. In presenting this information, the Company has also made assumptions based on such data and other similar sources, and on the Company’s knowledge of, and its experience to date in, the potential markets for its product. The industry in which the Company operates is subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section entitled “Risk Factors” in its Annual Report and other subsequent reports on Forms 10-Q and 8-K filed with the SEC. These and other factors could cause results to differ materially from those expressed in the estimates made by the independent parties and by the Company.

Website Disclosure

The Company uses its website (www.calyxt.com), its corporate Twitter account (@Calyxt_Inc) and its corporate LinkedIn account (https://www.linkedin.com/company/calyxt-inc) as routine channels of distribution of company information, including press releases, analyst presentations, and supplemental financial information, as a means of disclosing material non-public information and for complying with the Company’s disclosure obligations under Regulation FD. Accordingly, investors should monitor its website and its corporate Twitter and LinkedIn accounts in addition to following press releases, filings with the SEC, and public conference calls and webcasts.

Additionally, the Company provides notifications of announcements as part of its website. Investors and others can receive notifications of new press releases posted on the Company’s website by signing up for email alerts.

None of the information provided on the Company’s website, in its press releases or public conference calls and webcasts, or through social media is incorporated into, or deemed to be a part of, this Quarterly Report or in any other report or document the Company files with the SEC, and any references to its website or its corporate Twitter and LinkedIn accounts are intended to be inactive textual references only.

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

CALYXT, INC. CONSOLIDATED

BALANCE SHEETS

(In Thousands, Except Par Value and Share Amounts)


	September 30, 2022 (unaudited)			December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	7,031		$	13,823
Restricted cash		174			499
Prepaid expenses and other current assets		739			859

Total current assets		7,944			15,181
Non-current restricted cash		—			99
Land, buildings, and equipment		4,859			21,731
Operating lease right-of-use assets		13,736			—
Other non-current assets		163			183

Total assets	$	26,702		$	37,194

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	435		$	1,260
Accrued expenses		380			339
Accrued compensation		2,356			2,522
Due to related parties		138			172
Current portion of financing lease obligations		120			370
Common stock warrants		402			—
Other current liabilities		397			191

Total current liabilities		4,228			4,854
Financing lease obligations		—			17,506
Operating lease obligations		13,550			—
Other non-current liabilities		80			702

Total liabilities		17,858			23,062

Stockholders’ equity:
Common stock, $0.0001 par value; 275,000,000 shares authorized; 46,909,420 shares issued and 46,809,268 shares outstanding as of September 30, 2022, and 38,874,146 shares issued and 38,773,994 shares outstanding as of December 31, 2021		5			4
Additional paid-in capital		219,196			211,263
Common stock in treasury, at cost; 100,152 shares as of September 30, 2022, and December 31, 2021		(1,043	)		(1,043	)
Accumulated deficit		(209,314	)		(196,092	)

Total stockholders’ equity		8,844			14,132

Total liabilities and stockholders’ equity	$	26,702		$	37,194

See accompanying notes to these consolidated financial statements.

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CALYXT, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited and in Thousands Except Shares and Per Share Amounts)


	Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Revenue	$	42		$	7,762		$	115		$	24,044
Cost of goods sold		—			8,281			—			26,553

Gross profit		42			(519	)		115			(2,509	)
Operating expenses:
Research and development		3,016			2,579			9,207			8,473
Selling, general, and administrative		3,229			3,859			9,965			11,640

Total operating expenses		6,245			6,438			19,172			20,113

Loss from operations		(6,203	)		(6,957	)		(19,057	)		(22,622	)
Gain upon extinguishment of Payroll Protection Program loan		—			—			—			1,528
Interest, net		(47	)		(356	)		(80	)		(1,059	)
Non-operating income (expenses)		300			6			5,083			11

Loss before income taxes		(5,950	)		(7,307	)		(14,054	)		(22,142	)
Income taxes		—			—			—			—

Net loss	$	(5,950	)	$	(7,307	)	$	(14,054	)	$	(22,142	)

Basic and diluted net loss per share	$	(0.13	)	$	(0.20	)	$	(0.31	)	$	(0.60	)

Weighted average shares outstanding – basic and diluted		46,784,445			37,279,703			45,173,455			37,205,655

Anti-dilutive stock options, restricted stock units, performance stock units, and common stock warrants		15,997,260			5,966,488			15,997,260			5,966,488

See accompanying notes to these consolidated financial statements.

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CALYXT, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited and in Thousands Except Shares Outstanding)


Three Months Ended September 30, 2022	Shares Outstanding		Common Stock		Additional Paid-In Capital		Shares in Treasury			Accumulated Deficit			Total Stockholders’ Equity
Balance at June 30, 2022		46,715,542	$	5	$	218,161	$	(1,043	)	$	(203,364	)	$	13,759
Net loss		—		—		—		—			(5,950	)		(5,950	)
Stock-based compensation		—		—		1,035		—			—			1,035
Issuance of common stock and payment of minimum employee taxes withheld upon net share settlement of restricted stock units		93,726		—		—		—			—			—

Balance at September 30, 2022		46,809,268	$	5	$	219,196	$	(1,043	)	$	(209,314	)	$	8,844


Three Months Ended September 30, 2021	Shares Outstanding		Common Stock		Additional Paid-In Capital		Shares in Treasury			Accumulated Deficit			Total Stockholders’ Equity
Balance at June 30, 2021		37,205,473	$	4	$	204,663	$	(1,043	)	$	(181,728	)	$	21,896
Net loss		—		—		—		—			(7,307	)		(7,307	)
Stock-based compensation		—		—		1,236		—			—			1,236
Issuance of common stock and payment of minimum employee taxes withheld upon net share settlement of restricted stock units		96,251		—		—		—			—			—

Balance at September 30, 2021		37,301,724	$	4	$	205,899	$	(1,043	)	$	(189,035	)	$	15,825


Nine Months Ended September 30, 2022	Shares Outstanding		Common Stock		Additional Paid-In Capital			Shares in Treasury			Accumulated Deficit			Total Stockholders’ Equity
Balance at December 31, 2021		38,773,994	$	4	$	211,263		$	(1,043	)	$	(196,092	)	$	14,132
Net loss		—		—		—			—			(14,054	)		(14,054	)
Stock-based compensation		—		—		2,890			—			—			2,890
Issuance of common stock and payment of minimum employee taxes withheld upon net share settlement of restricted stock units		275,274		—		—			—			—			—
Issuance of common stock from ATM facility, net of offering expenses		—		—		(7	)		—			—			(7	)
Issuance of common stock and pre-funded warrants in registered offering, net of $0.5 million of offering costs		3,880,000		1		5,050			—			—			5,051
Issuance of common stock upon exercise of pre-funded warrants		3,880,000		—		—			—			—			—
Cumulative effect of adoption of lease accounting standard		—		—		—			—			832			832

Balance at September 30, 2022		46,809,268	$	5	$	219,196		$	(1,043	)	$	(209,314	)	$	8,844


Nine Months Ended September 30, 2021	Shares Outstanding		Common Stock		Additional Paid-In Capital		Shares in Treasury			Accumulated Deficit			Total Stockholders’ Equity
Balance at December 31, 2020		37,065,044	$	4	$	204,807	$	(1,043	)	$	(166,893	)	$	36,875
Net loss		—		—		—		—			(22,142	)		(22,142	)
Stock-based compensation		—		—		865		—			—			865
Issuance of common stock and payment of minimum employee taxes withheld upon net share settlement of restricted stock units		236,680		—		227		—			—			227

Balance at September 30, 2021		37,301,724	$	4	$	205,899	$	(1,043	)	$	(189,035	)	$	15,825

See accompanying notes to these consolidated financial statements.

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CALYXT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited and in Thousands)


	Nine Months Ended September 30,
	2022			2021
Operating activities
Net loss	$	(14,054	)	$	(22,142	)
Adjustments to reconcile net loss to net cash used by operating activities:
Gain upon extinguishment of Payroll Protection Program loan		—			(1,528	)
Depreciation and amortization		1,158			1,776
Stock-based compensation		2,890			865
Unrealized (gain) loss on mark-to-market of common stock warrants		(5,009	)		—
Changes in operating assets and liabilities:
Accounts receivable		—			4,681
Due to/from related parties		(34	)		(617	)
Inventory		—			(291	)
Prepaid expenses and other current assets		297			2,873
Accounts payable		(188	)		108
Accrued expenses		41			(1,742	)
Accrued compensation		(166	)		334
Other		(536	)		1,029

Net cash used by operating activities		(15,601	)		(14,654	)

Investing activities
Proceeds from sales of short-term investments		—			11,698
Purchases of land, buildings, and equipment		(1,509	)		(376	)

Net cash (used by) provided by investing activities		(1,509	)		11,322

Financing activities
Proceeds from the issuance of common stock, and pre-funded warrants		11,209			—
Costs incurred related to the issuance of common stock, pre-funded warrants, and common warrants		(962	)		—
Repayments of financing lease obligations		(353	)		(271	)
Proceeds from the exercise of stock options		—			227

Net cash provided by (used by) financing activities		9,894			(44	)

Net (decrease) in cash, cash equivalents, and restricted cash		(7,216	)		(3,376	)
Cash, cash equivalents, and restricted cash – beginning of period		14,421			18,289

Cash, cash equivalents, and restricted cash – end of period	$	7,205		$	14,913

See accompanying notes to these consolidated financial statements.

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CALYXT, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. BASIS OF PRESENTATION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The unaudited consolidated financial statements of Calyxt, Inc. (Calyxt or the Company) have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP or GAAP) for interim financial information and with the rules and regulations of the Securities and Exchange Commission (SEC) applicable to interim financial statements. In the Company’s opinion, the accompanying consolidated financial statements reflect all adjustments necessary for a fair presentation of its statements of financial position, results of operations, and cash flows for the periods presented but they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. Except as otherwise disclosed herein, these adjustments consist of normal recurring items. Operating results for interim periods are not necessarily indicative of results that may be expected for the fiscal year as a whole or any other interim period.

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures at the date of the consolidated financial statements and during the reporting period. Actual results could materially differ from these estimates.

Certain prior year amounts have been reclassified to conform to the current year presentation.

SEC Form 10-Q filed by Calyxt Inc.