Cell Source (CLCS) Risk Analysis
Risk Overview Q1, 2025
Source: the company's latest filing for the period ended Mar 31, 2025, filed May 14, 2026
Risk Change Over Time
- Economy & Political Environment - Risk 1The Russia-Ukraine and Israel-Hamas wars have disrupted global markets and my adversely impact our ability to obtain financing.
On February 24, 2022, Russian military forces invaded Ukraine, and the length, impact, and outcome of the ongoing war in Ukraine is highly unpredictable. On October 7, 2023, Hamas terrorists infiltrated Israel's border with the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas has also launched extensive rocket attacks on Israeli population and industrial centers located along Israel's border with the Gaza Strip and in other areas within the State of Israel. These attacks have resulted in extensive deaths, injuries and kidnapping. Following the attack, Israel's security cabinet declared war against Hamas and a military campaign against these terrorist organizations commenced in parallel to their continued rocket and terror attacks. The intensity and duration of Israel's current war against Hamas is similarly difficult to predict. As a result of the Russia-Ukraine and Israel-Hamas wars and other geopolitical and macroeconomic events, the global credit and financial markets have experienced volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, and uncertainty about economic stability. If the equity and credit markets deteriorate, it may make any necessary debt or equity financing more difficult, more costly or more dilutive.
Risk Highlights Q1, 2025
Risk Word Cloud
Risk Factors Full Breakdown - Total Risks 48
- Share Price & Shareholder Rights - Risk 1There may be additional issuances of shares of preferred stock in the future.
Our Articles of Incorporation permit us to issue up to 10,000,000 shares of preferred stock and our board of directors has authorized 1,350,000 shares of Series A Convertible Preferred, 2,000,000 shares of Series B Convertible Preferred, and 1,000,000 shares of Series C Convertible Preferred Stock, for issuance. Our board of directors could authorize the issuance of additional series of preferred stock in the future and such preferred stock could grant holders preferred rights on parity with the Series A Preferred, Series B Preferred and Series C Preferred as to dividend payments and liquidation preference. The issuance of other series of preferred stock could have the effect of reducing the amounts available to the holders Series A Preferred, Series B Preferred and Series C Preferred in the event of our liquidation, winding-up or dissolution. It may also reduce cash dividend payments on the Series A Preferred if we do not have sufficient funds to pay dividends on all Series A Preferred, Series B Preferred and Series C Preferred outstanding and outstanding parity preferred stock.
- Share Price & Shareholder Rights - Risk 2Our articles of incorporation allow for our board to create a new series of preferred stock without further approval by our stockholders, which could adversely affect the rights of the holders of our Common Stock.
Our Board of Directors has the authority to fix and determine the relative rights and preferences of preferred stock. Our Board of Directors have the authority to issue up to 10,000,000 shares of our preferred stock, the terms of which may be determined by the Board without further stockholder approval. As a result, our Board of Directors could authorize the issuance of a series of preferred stock that would grant to holders the preferred right to our assets upon liquidation, the right to receive dividend payments before dividends are distributed to the holders of Common Stock and the right to the redemption of the shares, together with a premium, prior to the redemption of our Common Stock. In addition, our Board of Directors could authorize the issuance of a series of preferred stock that has greater voting power than our Common Stock or that is convertible into our Common Stock, which could decrease the relative voting power of our Common Stock or result in dilution to our existing stockholders.
- Share Price & Shareholder Rights - Risk 3There is not an active liquid trading market for the Company's Common Stock.
The Company is required to report under the Exchange Act and its Common Stock is eligible for quotation on the OTC Markets. However, there is no regular active trading market in the Company's Common Stock, and we cannot give any assurance that an active trading market will develop. If an active market for the Company's Common Stock develops, there is a significant risk that the Company's stock price may fluctuate dramatically in the future in response to any of the following factors, some of which are beyond our control: - variations in our quarterly operating results; - announcements that our revenue or income are below analysts' expectations; - general economic slowdowns; - sales of large blocks of the Company's Common Stock; and - announcements by us or our competitors of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments.
- Share Price & Shareholder Rights - Risk 4Our Common Stock is subject to the "penny stock" rules of the Securities and Exchange Commission, which may make it more difficult for stockholders to sell our Common Stock.
The SEC has adopted Rule 15g-9 which establishes the definition of a "penny stock," for the purposes relevant to us, as any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require that a broker or dealer approve a person's account for transactions in penny stocks, and the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve a person's account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of the person and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to the penny stock market, which, in highlight form sets forth the basis on which the broker or dealer made the suitability determination, and that the broker or dealer received a signed, written agreement from the investor prior to the transaction. Generally, brokers may be less willing to execute transactions in securities subject to the "penny stock" rules. This may make it more difficult for investors to dispose of the Company's Common Stock if and when such shares are eligible for sale and may cause a decline in the market value of its stock. Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stock.
- Share Price & Shareholder Rights - Risk 5Voting power of our shareholders is highly concentrated by insiders.
Our officers, directors and affiliates currently own or have rights to acquire shares of common stock and preferred stock representing approximately 20.4% of the voting power of our outstanding securities stock. Such concentrated control of the Company may adversely affect the value of our ordinary shares. If you acquire shares of our common stock, you may have no effective voice in our management. Sales by our insiders or affiliates, along with any other market transactions, could affect the value of our ordinary shares.
- Share Price & Shareholder Rights - Risk 6We are required to comply with certain provisions of Section 404 of the Sarbanes-Oxley Act of 2002 and if we fail to comply in a timely manner, our business could be harmed and our stock price could decline.
Rules adopted by the SEC pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 require an annual assessment of internal controls over financial reporting, and for certain issuers an attestation of this assessment by the issuer's independent registered public accounting firm. The standards that must be met for management to assess the internal controls over financial reporting as effective are evolving and complex, and require significant documentation, testing, and possible remediation to meet the detailed standards. We expect to incur significant expenses and to devote resources to Section 404 compliance on an ongoing basis. It is difficult for us to predict how long it will take or how costly it will be to complete the assessment of the effectiveness of our internal control over financial reporting for each year and to remediate any deficiencies in our internal control over financial reporting. As a result, we may not be able to complete the assessment and remediation process on a timely basis. In addition, although attestation requirements by our independent registered public accounting firm are not presently applicable to us, we could become subject to these requirements in the future and we may encounter problems or delays in completing the implementation of any resulting changes to internal controls over financial reporting. In the event that our principal executive and financial officer determines that our internal control over financial reporting is not effective as defined under Section 404, we cannot predict how regulators will react or how the market prices of our shares will be affected; however, we believe that there is a risk that investor confidence and share value may be negatively affected.
- Share Price & Shareholder Rights - Risk 7As an issuer of "penny stock," the protection provided by the federal securities laws relating to forward looking statements does not apply to us.
Although federal securities laws provide a safe harbor for forward-looking statements made by a public company that files reports under the federal securities laws, this safe harbor is not available to issuers of penny stocks. As a result, we will not have the benefit of this safe harbor protection in the event of any legal action based upon a claim that the material provided by us contained a material misstatement of fact or was misleading in any material respect because of our failure to include any statements necessary to make the statements not misleading. Such an action could hurt our financial condition.
- Share Price & Shareholder Rights - Risk 8Our issuance of Common Stock upon exercise of warrants or options may depress the price of our Common Stock.
As of December 31, 2024, we had 45,038,244 shares of Common Stock issued and outstanding and outstanding warrants to purchase 20,769,303 shares of Common Stock. The issuance of shares of Common Stock upon exercise of outstanding warrants or options could result in substantial dilution to our stockholders, which may have a negative effect on the price of our Common Stock.
- Share Price & Shareholder Rights - Risk 9Our stock price may be volatile or may decline regardless of our operating performance, resulting in substantial losses for investors.
The market price of our common stock may be highly volatile and may fluctuate substantially as a result of a variety of factors, some of which are related in complex ways. The market price of our common stock may fluctuate significantly in response to numerous factors, many of which are beyond our control, including the factors listed below and other factors describe in this "Risk Factors" section: - the commencement, enrollment, or results of current and future preclinical studies and clinical trials and trials we may conduct, or changes in the development status of our product candidates; - any delay in our regulatory filings for our product candidates and any adverse development or perceived adverse development with respect to the applicable regulatory authority's review of such filings, including, without limitation, the issuance by the FDA of a "refusal to file" letter or a request for additional information; - adverse results or delays in clinical trials; - our decision to initiate a preclinical study or clinical trial, not to initiate a preclinical study or clinical trial or to terminate an existing preclinical study or clinical trial; - adverse actions taken by regulatory agencies with respect to our preclinical studies or clinical trials, manufacturing supply chain or sales and marketing activities, including failure to receive regulatory approval of our product candidates; - changes in laws or regulations, including, but not limited to, preclinical study or clinical trial requirements for approvals; - any adverse changes to our relationship with manufacturers or suppliers; - manufacturing, supply or distribution shortages; - our failure to commercialize our product candidates; - changes in the structure of healthcare payment systems; - additions or departures of key scientific or management personnel; - unanticipated serious safety concerns related to the use of our product candidates;- disputes or other developments relating to proprietary rights, including patents, litigation matters, and our ability to obtain patent protection for our technologies; - variations in our results of operations; - our cash position; - our failure to meet the estimates and projections of the investment community or that we may otherwise provide to the public; - publication of research reports about us or our industry, or in vivo and ex vivo cell engineering products in particular, or positive or negative recommendations or withdrawal of research coverage by securities analysts; - announcements made by us or our competitors of new product and service offerings, acquisitions, strategic relationships, joint ventures, or capital commitments; - our inability to establish collaborations, if needed; - our ability to effectively manage our growth; - the size and growth of our initial target markets; - changes in the market valuations of similar companies; - press reports, whether or not true, about our business; - sales or perceived potential sales of our common stock by us or our stockholders in the future; - overall fluctuations in the equity markets; - ineffectiveness of our internal controls; - changes in accounting practices or principles; - changes or developments in the global regulatory environment; - litigation involving us, our industry or both, or investigations by regulators into our operations or those of our competitors; - general political and economic conditions; and - other events or factors, many of which are beyond our control. In addition, the stock market in general and biopharmaceutical companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies. Broad market and industry factors may negatively affect the market price of our common stock, regardless of our actual operating performance. If the market price of our common stock after this offering does not exceed the initial public offering price, you may not realize any return on and may lose some or all of your investment.
- Share Price & Shareholder Rights - Risk 10If we take advantage of specified reduced disclosure requirements applicable to a "smaller reporting company", the information that we provide to stockholders may be different than they might receive from other public companies.
As a company with less than $100 million in revenue during our last fiscal year and a public float of less than $250 million, we qualify as a "smaller reporting company". As a smaller reporting company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies. These provisions include: - Only two years of audited financial statements in addition to any required unaudited interim financial statements with correspondingly reduced "Management's Discussion and Analysis of Financial Condition and Results of Operations" disclosure; - Reduced disclosure about our executive compensation arrangements; - Exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting. As a result of our status as a "smaller reporting company," the information that we provide stockholders may be different than you might get from other public companies in which you hold stock.
See a full breakdown of risk according to category and subcategory. The list starts with the category with the most risk. Click on subcategories to read relevant extracts from the most recent report.
