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RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS
 9 Months Ended
Mar. 31, 2024
Restatement Of Previously Issued Financial Statements  
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

NOTE 2 — RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

 

On July 12, 2024, the Company received an SEC Comment Letter questioning its accounting for its indefinite life intangible assets impairment related to the license agreement with Weird Science, LLC which was terminated on March 31, 2024, as described in Note 6.

 

After further analysis by management and review of the applicable accounting requirements, the Company determined that its original impairment recognized in its March 31, 2024 financial statements was not correct and those financial statements should be restated to reflect further impairment of certain of its indefinite life intangible assets related to the license agreement with Weird Science, LLC.

 

The impact of the restatement on these financial statements by line item is as follows:

 

         
   As Reported  Change  As Restated
Indefinite life intangible assets  $44,945,255   $(34,190,000)  $10,755,255 
                
Total other assets  $210,570,510   $(34,190,000)  $176,380,510 
Total assets  $212,279,340   $(34,190,000)  $178,089,340 
Accumulated deficit  $(274,757,816)  $(34,190,000)  $(308,947,816)
Total stockholders’ equity  $168,595,556   $(34,190,000)  $134,405,556 
Total liabilities and stockholders’ equity  $212,279,340   $(34,190,000)  $178,089,340 
Intangible asset impairment  $8,421,000   $34,190,000   $42,611,000 
Total operating expenses for the three months ended March 31, 2024  $17,190,840   $34,190,000   $51,380,840 
Total operating expenses for the nine months ended March 31, 2024  $30,345,029   $34,190,000   $64,535,029 
Loss from operations three months ended March 31, 2024  $(17,190,840)  $(34,190,000)  $(51,380,840)
Loss from operations nine months ended March 31, 2024  $(30,345,029)  $(34,190,000)  $(64,535,029)
Net loss for the three months ended March 31, 2024  $(17,024,414)  $(34,190,000)  $(51,214,414)
Net loss for the nine months ended March 31, 2024  $(30,728,563)  $(34,190,000)  $(64,918,563)
Comprehensive loss for the three months ended March 31, 2024  $(15,963,213)  $(34,190,000)  $(50,153,213)
Comprehensive loss for the nine months ended March 31, 2024  $(29,664,711)  $(34,190,000)  $(63,854,711)
Basic and diluted net loss per share for the three months ended March 31, 2024  $(0.16)  $(0.32)  $(0.48)
Basic and diluted net loss per share for the nine months ended March 31, 2024  $(0.39)  $(0.43)  $(0.82)

  

Additionally, during the preparation of the Company’s Form 10-Q for the period ended December 31, 2024, the Company determined that certain warrants which were exercised during the three months ended March 31, 2024, had not been appropriately reflected as a component of the change in fair value of the contingent consideration during the three and nine months ended March 31, 2024. The number of shares underlying these warrants was 3,425,399 which had a fair value of $7,775,656 on the date of exercise.

  

The impact of the restatement on these financial statements by line item is as follows:

 

         
   As Reported  Change  As Restated
Common stock  $14,750   $343  $15,093 
Additional paid-in capital  $442,304,652   $7,775,313  $450,079,965 
Accumulated deficit  $(308,847,816)  $(7,775,656)  $(316,723,472)
Change in fair value of contingent consideration  $486,500   $(7,774,656)  $(7,289,156)
Net loss for the three months ended March 31, 2024  $(51,214,414 )  $(7,774,656)  $(58,990,070)
Net loss for the nine months ended March 31, 2024  $(64,918,563)  $(7,774,656)  $(72,694,219)
Comprehensive loss for the three months ended March 31, 2024  $(50,152,213)  $(7,774,656)  $(57,928,869)
Comprehensive loss for the nine months ended March 31, 2024  $(63,854,711)  $(7,774,656)  $(71,630,368)
Basic and diluted net loss per share for the three months ended March 31, 2024  $(0.48)  $(0.06)  $(0.54)
Basic and diluted net loss per share for the nine months ended March 31, 2024  $(0.82)  $(0.09)  $(0.91)