GridAI Technologies Corp 10-Q for FY2023 Q1

GridAI Technologies Corp. (GRDX)

10-Q 2023-05-12 For: 2023-03-31

Added on April 11, 2026

About this 10-Q

GridAI Technologies Corp filed this 10-Q on May 12, 2023, covering the quarter ended March 31, 2023 (FY2023 Q1).

Headline figures

Quarter ended March 31, 2023, as reported in this filing, compared with the same period a year earlier where the filing states it.

Net loss: $4.07M; compared with a net loss of $9.63M a year earlier
Diluted EPS: -$1.82; compared with -$138.28 a year earlier

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Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Common stock, par value $0.0001 per share	FWBI	The Nasdaq Capital Market


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐


		Page

PART I. FINANCIAL INFORMATION

Item 1.	Unaudited Condensed Consolidated Financial Statements	1

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	25

Item 4.	Controls and Procedures	26

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	27

Item 1A.	Risk Factors	27

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28

Item 3.	Defaults Upon Senior Securities	28

Item 4.	Mine Safety Disclosures	28

Item 5.	Other Information	28

Item 6.	Exhibits	28

SIGNATURES


	March 31,
	2023		December 31,
	(unaudited)		2022
ASSETS

Current Assets:
Cash and cash equivalents	$	2,064,435	$	1,362,910
Other receivables		20,000		93,014
Prepaid expenses		1,445,438		1,956,831
Total Current Assets		3,529,873		3,412,755

Property, equipment, and leasehold improvements, net		36,521		43,839

Other Assets:
Restricted Cash		21,518		21,513
Goodwill		1,684,182		1,684,182
Operating lease right-of-use assets		243,733		259,261
Deposits		18,149		18,149
Total Other Assets		1,967,582		1,983,105
Total Assets	$	5,533,976	$	5,439,699

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:
Accounts payable	$	469,760	$	720,040
Accrued expenses		845,728		320,176
Accrued dividend payable		848,919		761,488
Note payable		380,390		603,494
Operating lease liabilities		67,936		66,151
Other current liabilities		12,123		12,138
Total Current Liabilities		2,624,856		2,483,487
Non-current operating lease liabilities		196,524		214,060
Total Liabilities		2,821,380		2,697,547


Stockholders’ Equity:
Common stock - Par value $0.0001 per share; 50,000,000 shares authorized; 1,549,581 and 995,003 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively		155		100
Series B preferred stock- Par value $0.0001 per share; 5,194.81 shares authorized; 545.94 and 550.17 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively		—		—
Series C preferred stock- Par value $0.0001 per share; 75,000 shares authorized; 0 shares issued and outstanding at March 31, 2023 and December 31, 2022		—		—
Series D preferred stock- Par value $0.0001 per share; 150 shares designated; 0 shares issued and outstanding at March 31, 2023 and December 31, 2022		—		—
Series E preferred stock- Par value $0.0001 per share; 150 shares designated; 0 shares issued and outstanding at March 31, 2023 and December 31, 2022		—		—
Series F preferred stock- Par value $0.0001 per share; 7,000 shares designated; 0 shares issued and outstanding at March 31, 2023 and December 31, 2022		—		—
Additional paid-in capital		175,316,783		171,275,741
Accumulated deficit		(172,604,342)		(168,533,689)
Total Stockholders’ Equity		2,712,596		2,742,152
Total Liabilities and Stockholders’ Equity	$	5,533,976	$	5,439,699


	Three Months Ended March 31,
	2023		2022
Operating expenses:
Research and development expenses	$	1,361,683	$	4,976,517
General and administrative expenses		2,700,742		4,405,555
Total operating expenses		4,062,425		9,382,072

Loss from operations		(4,062,425)		(9,382,072)

Other expense:
Interest expense		(8,987)		(5,605)
Interest income		1,873		139
Other expense		(1,114)		(239,301)
Total expense		(8,228)		(244,767)

Net loss	$	(4,070,653)	$	(9,626,839)

Other comprehensive loss:
Foreign currency translation adjustment		—		(58,405)
Total comprehensive loss	$	(4,070,653)	$	(9,685,244)

Net loss	$	(4,070,653)	$	(9,626,839)
Preferred stock dividends		(87,431)		(90,792)
Net loss applicable to common shareholders	$	(4,158,084)	$	(9,717,631)

Basic and diluted weighted average shares outstanding		2,280,679		74,022
Loss per share - basic and diluted	$	(1.82)	$	(138.28)


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


☐	TRANSITION REPORT UNDER SECTION 13 OF 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



	Series B Convertible						Additional				Total
	Preferred Stock			Common Stock			Paid In		Accumulated		Stockholders’
	Shares	Amount		Shares	Amount		Capital		Deficit		Equity
Balance, January 1, 2023	550	$	—	995,003	$	100	$	171,275,741	$	(168,533,689)	$	2,742,152
Issuance of common stock, pre-funded warrants and warrants in private placement, net of issuance costs	—		—	128,000		13		3,769,898		—		3,769,911
Exercise of pre-funded warrants into common stock	—		—	429,475		42		259		—		301
Deemed dividend of Series B preferred stock	—		—	—		—		(87,431)		—		(87,431)
Conversion of Series B preferred shares into common stock	(4)		—	70		—		—		—		—
Effect of cancelled shares from the 1-for-7 reverse stock split	—		—	(2,967)		—		—		—		—
Stock-based compensation	—		—	—		—		358,316		—		358,316
Net loss	—		—	—		—		—		(4,070,653)		(4,070,653)
Balance, March 31, 2023	546	$	—	1,549,581	$	155	$	175,316,783	$	(172,604,342)	$	2,712,596


			Fair Value Measured at Reporting Date
			Using
	Carrying
	Amount		Level 1		Level 2		Level 3		Fair Value
March 31, 2023 (unaudited):
Money market funds	$	11,777	$	11,777	$	—	$	—	$	11,777
Note payable		380,390		—		380,390		—		380,390

December 31, 2022:
Money market funds		509,890		509,890		—		—		509,890
Note payable	$	603,494	$	—	$	603,494	$	—	$	603,494


	Goodwill
Balance on January 1, 2022	$	1,911,705
Foreign currency translation		(227,523)
Balance on December 31, 2022		1,684,182
Foreign currency translation		—
Balance on March 31, 2023 (unaudited)	$	1,684,182


		Weighted		Weighted
		Average		Average
	Number of	Exercise Price		Remaining
	Warrants	Per Share		Term in Years
Outstanding and exercisable on January 1, 2023	2,179,798	$	19.16	5.50
Issued	2,941,054		2.55	4.96
Exercised	(429,473)		0.00	5.28
Warrants outstanding and exercisable on March 31, 2023	4,691,379	$	10.50	5.07

Warrants outstanding and exercisable on January 1, 2022	26,089	$	1,992.90	3.95
Issued	56,382		160.37	4.92
Expired	(33)		10,414.73	—
Exercised	(23,087)		2.10	4.92
Warrants outstanding and exercisable on March 31, 2022	59,351	$	1,019.89	4.39


		Average		Remaining
	Number	Exercise		Contract	Intrinsic
	of Shares	Price		Life (Years)	Value
Outstanding at January 1, 2023	4,076	$	958.14	8.22	$	—
Granted	5,000		3.73	9.91		—
Forfeited	(11)		573.68	—		—
Outstanding at March 31, 2023	9,065	$	445.02	9.07	$	—
Exercisable at March 31, 2023	4,007	$	854.57	8.40	$	—

Outstanding at January 1, 2022	1,941	$	2,470.99	7.28	$	—
Granted	3,219		291.90	9.11		—
Canceled	(12)		2,032.80	—		—
Forfeited	(353)		833.70	—		—
Outstanding at March 31, 2022	4,795	$	1,152.90	8.67	$	—
Exercisable at March 31, 2022	1,812	$	2,226.00	7.15	$	—


	2023		2022
Contractual term (in years)	6.5		10
Expected Volatility	98.80	%	90.92	%
Risk-free interest rate	4.08	%	1.11	%
Expected Dividend yield	0	%	0	%


		Weighted-Average		Weighted-Average
	Number	Grant Date		Remaining Recognition
	of Shares	Fair Value		Period (Years)
Non-vested Outstanding at January 1, 2023	—	$	—	—
Awarded	160,239		6.20
Vested	(40,064)		6.20
Non-vested Outstanding at March 31, 2023	120,175	$	6.20	0.75


	March 31,
	2023
Lease term and discount rate
Weighted-average remaining lease term (years)	3.4
Weighted-average discount rate	7.00	%


	Three Months Ended March 31,
	2023		2022
Cash flows from operating activities:
Net loss	$	(4,070,653)	$	(9,626,839)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		7,318		7,317
Change in right-of-use assets		15,528		23,188
Stock-based compensation		358,316		218,229
Common stock granted to consultants		—		118,999
Changes in assets and liabilities:
Other receivables		73,014		(28,055)
Prepaid expenses		511,393		349,140
Lease liabilities		(15,751)		(53,883)
Deposits		—		9,615
Accounts payable		(250,280)		1,996,602
Accrued expenses		525,552		(930,144)
Other liabilities		(15)		3,757
Net cash used in operating activities		(2,845,578)		(7,912,074)

Cash flows from financing activities:
Proceeds from issuance of common stock, prefunded warrants and warrants, net		3,769,911		7,972,091
Proceeds from exercise of warrants		301		48,482
Payment made related to acquisition agreement		—		(2,414,956)
Repayments of note payable		(223,104)		(238,470)
Net cash provided by financing activities		3,547,108		5,367,147

Net increase (decrease) in cash, cash equivalents and restricted cash		701,530		(2,544,927)

Effect of exchange rate changes on cash		—		(8,769)

Cash, cash equivalents and restricted cash, beginning balance		1,384,423		8,248,684
Cash, cash equivalents and restricted cash, ending balance	$	2,085,953	$	5,694,988

Supplemental disclosures of cash flow information:
Cash paid for interest	$	8,987	$	5,605

Non-cash investing and financing activities:
Accrued dividends on preferred stock	$	(87,431)	$	(90,792)


	March 31,
	2023		December 31,
	(unaudited)		2022
Computer equipment and software	$	11,540	$	11,540
Office equipment		48,278		48,278
Leasehold improvements		28,000		28,000
Total property, plant, and equipment		87,818		87,818
Less accumulated depreciation		(51,297)		(43,979)
Property, plant and equipment, net	$	36,521	$	43,839


	March 31,
	2023		December 31,
	(unaudited)		2022
Clinical trials	$	630,587	$	5,340
Professional fees		215,141		309,867
Consulting fees		—		4,969
Total accrued expenses	$	845,728	$	320,176


2023 (remainder of year)	$	63,128
2024		86,202
2025		88,788
2026		60,593
Total lease payments		298,711
Less imputed interest		(34,251)
Present value of lease liabilities	$	264,460


	March 31, 2023	March 31, 2022
	(unaudited)	(unaudited)
Common stock warrants	4,691,379	59,351
Stock options	9,065	4,795
RSUs not yet issued	160,239	—
Convertible preferred stock (1)	3,102	3,416
Restricted stock not yet issued	162	162
Total shares of common stock issuable	4,863,947	67,724


	Three Months Ended
	March 31,
	2023		2022		Decrease
Operating expenses:
Research and development expenses	$	1,361,683	$	4,976,517	$	(3,614,834)
General and administrative expenses		2,700,742		4,405,555		(1,704,813)
Total operating expenses		4,062,425		9,382,072		(5,319,647)
Other expenses		8,228		244,767		(236,539)
Net loss	$	4,070,653	$	9,626,839	$	(5,556,186)


Exhibit No.		Description
3.1		Amended and Restated Certificate of the Registrant (incorporated by reference to Exhibit 3.1 of the Company’s Annual Report on Form 10-K filed with the SEC on March 20, 2023).
4.1		Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed with the SEC on March 15, 2023).
4.2		Form of Warrant (incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K filed with the SEC on March 15, 2023).
10.1		Form of Purchase Agreement (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed with the SEC on March 15, 2023).
10.2		Form of Registration Rights Agreement (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed with the SEC on March 15, 2023).
10.3		Form of Purchase Agreement (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed with the SEC on March 1, 2022).
31.1*		Certification of the Principal Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of the Principal Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**		Certification of the Principal Executive Officer and Principal Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*		Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH*		Inline XBRL Taxonomy Extension Schema Document
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL Document and included in Exhibit 101)


	FIRST WAVE BIOPHARMA, INC.

	By	/s/ James Sapirstein
		James Sapirstein
		President, Chief Executive Officer and Chairman
		(Principal Executive Officer)


	By	/s/ Sarah Romano
		Sarah Romano
		Chief Financial Officer
Date: May 12, 2023		(Principal Financial and Accounting Officer)


Date: May 12, 2023	/s/ James Sapirstein
	James Sapirstein
	Chief Executive Officer
	(Principal Executive Officer)


Date: May 12, 2023	/s/ Sarah Romano
	Sarah Romano
	Chief Financial Officer
	(Principal Financial and Accounting Officer)


Date: May 12, 2023	/s/ James Sapirstein
	James Sapirstein
	President and Chief Executive Officer
	(Principal Executive Officer)

	/s/ Sarah Romano
	Sarah Romano
	Chief Financial Officer
	(Principal Financial and Accounting Officer)