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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2023

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

For the transition period from ___________ to ___________

GENELUX CORPORATION

(Exact name of registrant as specified in its charter)

Delaware

001-41599

77-0583529

(State or other jurisdiction of

incorporation or organization)

Commission

File Number

(IRS Employee

Identification No.)

2625 Townsgate Road, Suite 230, Westlake Village, California 91361

(Address of Principal Executive Offices)

(805) 267-9889

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Exchange Act:

Title of each class registered:

Trading symbol:

Name of each exchange on which registered:

Common Stock, par value $0.001 per share

GNLX

The Nasdaq Stock Market LLC

(Nasdaq Capital Market)

Securities registered under Section 12(g) of the Exchange Act: None

Indicate by check mark whether the issuer (1) 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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or smaller reporting company filer. See definition of “accelerated filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act (Check one):

Large Accelerated Filer ☐	Non-Accelerated Filer ☒
Accelerated Filer ☐	Smaller Reporting Company ☒
	Emerging Growth Company ☒

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 ☒

The number of shares issued and outstanding of each of the issuer’s classes of common equity as of August 9, 2023 was 26,182,892.

GENELUX CORPORATION

FORM 10-Q

June 30, 2023

TABLE OF CONTENTS

PART I— FINANCIAL INFORMATION

Item 1.	Condensed Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3	Quantitative and Qualitative Disclosures About Market Risk	34
Item 4.	Control and Procedures	35

PART II— OTHER INFORMATION		36

Item 1	Legal Proceedings	36
Item 1A	Risk Factors	36
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	109
Item 3.	Defaults Upon Senior Securities	110
Item 4.	Mine Safety Disclosures	110
Item 5.	Other Information	110
Item 6.	Exhibits	110

SIGNATURES		111

Genelux Corporation

Condensed Balance Sheets

(In thousands, except for share amounts and par value data)

	June 30, 2023			December 31, 2022
	(Unaudited)
ASSETS
Current Assets
Cash	$	27,140		$	397
Prepaid expenses and other current assets		1,543			1,495
Total Current Assets		28,683			1,892

Property and equipment, net		878			644
Right of use asset		1,710			1,335
Deferred offering costs		-			1,568
Other assets		92			92
Total Other Assets		2,680			3,639

TOTAL ASSETS	$	31,363		$	5,531

LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)
Current Liabilities
Accounts payable and accrued expenses	$	4,484		$	6,775
Accrued compensation		2,684			2,852
Accrued interest payable		-			1,178
Accrued interest payable - director and shareholders		60			3,817
Deferred revenue		-			170
Warrant liabilities		-			169
Lease liability, current portion		585			266
Notes payable - shareholders, net of debt discount of $108 in 2022		-			992
Convertible notes payable - shareholders, current portion, including $65 and $105 past due, respectively		65			15,407
Total Current Liabilities		7,878			31,626

Long-term Liabilities
Lease liability, long-term portion		1,229			1,164
Convertible notes payable, net of debt discount of $541 in 2022		-			8,524
Total Long-term Liabilities		1,229			9,688

Total Liabilities		9,107			41,314

Shareholders’ Equity (Deficit)
Preferred stock, Series A through K, par value $0.001, 10,000,000 shares authorized; no shares and 22,094,889 shares issued and outstanding, respectively;		-			22
Common stock, par value $0.001, 200,000,000 shares authorized; 25,855,511 and 9,126,726 shares issued and outstanding, respectively		26			9
Treasury stock, 433,333 shares, at cost		(433	)		(433	)
Additional paid-in capital		232,073			154,401
Accumulated other comprehensive income		2			2
Accumulated deficit		(209,412	)		(189,784	)
Total Shareholders’ Equity (Deficit)		22,256			(35,783	)

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)	$	31,363		$	5,531

The accompanying notes are an integral part of these condensed financial statements.

Genelux Corporation

Condensed Statements of Operations

(in thousands, except for share amounts and per share data)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2023			2022			2023			2022
	(Unaudited)						(Unaudited)

Revenues	$	-		$	-		$	170		$	-

Operating expenses:
Research and development		2,943			1,827			5,788			4,196
General and administrative		2,452			972			6,239			2,067
Total operating expenses		5,395			2,799			12,027			6,263

Loss from operations		(5,395	)		(2,799	)		(11,857	)		(6,263	)

Other expenses:
Interest expense		(24	)		(285	)		(167	)		(573	)
Debt discount amortization		-			(50	)		(649	)		(99	)
Financing costs		-			-			(3,110	)		-
Debt extinguishment costs		(402	)		-			(402	)		-
Gain on forgiveness of PPP loan payable		-			314			-			314
Total other expenses		(426	)		(21	)		(4,328	)		(358	)

NET LOSS	$	(5,821	)	$	(2,820	)	$	(16,185	)	$	(6,621	)

BASIC AND DILUTED LOSS PER COMMON SHARE	$	(0.23	)	$	(0.31	)	$	(0.72	)	$	(0.73	)

WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING -BASIC AND DILUTED		25,068,334			9,111,694			22,334,311			9,111,039

The accompanying notes are an integral part of these condensed financial statements.

Genelux Corporation

Condensed Statements of Shareholders’ Equity (Deficit) (Unaudited)

(in thousands, except share amounts)

																			Accumulated
	Preferred Stock																Additional		Other
	Series A through K						Common Stock				Treasury Stock						Paid-in		Comprehensive		Accumulated
	Shares			Amount			Shares		Amount		Shares			Amount			Capital		Income		Deficit			Total

Balance, March 31, 2023 (unaudited)		-		$	-			24,553,470	$	24		(433,333	)	$	(433	)	$	206,689	$	2	$	(203,591	)	$	2,691

Stock compensation		-			-			-		-		-			-			240		-		-			240

Issuance of common shares upon the closing of private financings, net of offering costs		-			-			1,117,079		2		-			-			21,640		-		-			21,642

Conversion of notes payable-shareholders and accrued interest		-			-			73,134		-		-			-			1,865		-		-			1,865

Fair value of vested restricted stock units		-			-			-		-		-			-			429		-		-			429

Cost of stock option repricing		-			-			-		-		-			-			36		-		-			36

Issuance of common shares upon exercise of stock warrants		-			-			111,828		-		-			-			1,174		-		-			1,174

Net loss during the three months ended June 30, 2023		-			-			-		-		-			-			-		-		(5,821	)		(5,821	)

Balance, June 30, 2023 (unaudited)		-		$	-			25,855,511		26		(433,333	)	$	(433	)	$	232,073	$	2	$	(209,412	)	$	22,256

Balance, December 31, 2022		22,094,889		$	22			9,126,726	$	9		(433,333	)	$	(433	)	$	154,401	$	2	$	(189,784	)	$	(35,783	)

Stock compensation		-			-			-		-		-			-			467		-		-			467

Issuance of common shares upon the closing of the initial public offering, net of offering costs		-			-			2,653,000		3		-			-			12,629		-		-			12,632

Issuance of common shares upon the closing of private financings, net of offering costs		-			-			1,117,079		2		-			-			21,640		-		-			21,642

Issuance of common shares upon conversion of preferred stock		(22,094,889	)		(22	)		8,355,610		8		-			-			14		-		-			-

Issuance of common shares upon conversion of convertible notes payable, accrued interest and loan fees		-			-			4,134,367		4		-			-			29,892		-		-			29,896

Issuance of common shares upon conversion of preferred stock dividends payable		-			-			272,101		-		-			-			3,443		-		(3,443	)		-

Fair value of vested restricted stock units		-			-			-		-		-			-			627		-		-			627

Cost of stock option repricing		-			-			-		-		-			-			2,642		-		-			2,642

Reclassification of warrant liabilities upon the closing of the initial public offering		-			-			-		-		-			-			169		-		-			169

Fair value of warrants issued in connection with the conversion of convertible notes payable		-			-			-		-		-			-			3,110		-		-			3,110

Conversion of notes payable-shareholders and accrued interest		-			-			73,134		-		-			-			1,865		-		-			1,865

Issuance of common shares upon exercise of stock warrants		-			-			123,494		-		-			-			1,174		-		-			1,174

Net loss during the six months ended June 30, 2023		-			-			-		-		-			-			-		-		(16,185	)		(16,185	)

Balance, June 30, 2023 (unaudited)		-		$	-			25,855,511	$	26		(433,333	)	$	(433	)	$	232,073	$	2	$	(209,412	)	$	22,256

Balance, March 31, 2022 (unaudited)		22,094,889		$	22			9,110,060	$	9		(433,333	)	$	(433	)	$	152,238	$	2	$	(188,378	)	$	(36,540	)

Stock compensation		-			-			-		-		-			-			297		-		-			297

Shares issued upon exercise of stock warrant		-			-			3,333		-		-			-			-		-		-			-

Net loss during the three months ended June 30, 2022		-			-			-		-		-			-			-		-		(2,820	)		(2,820	)

Balance, June 30, 2022 (unaudited)		22,094,889		$	22			9,113,393	$	9		(433,333	)	$	(433	)	$	152,535	$	2	$	(191,198	)	$	(39,063	)

Balance, December 31, 2021		22,094,889		$	22			9,110,060	$	9		(433,333	)	$	(433	)	$	151,866	$	2	$	(184,577	)	$	(33,111	)
Balance		22,094,889		$	22			9,110,060	$	9		(433,333	)	$	(433	)	$	151,866	$	2	$	(184,577	)	$	(33,111	)

Stock compensation		-			-			-		-		-			-			669		-		-			669

Shares issued upon exercise of stock warrant		-			-			3,333		-		-			-			-		-		-			-

Net loss during the six months ended June 30, 2022		-			-			-		-		-			-			-		-		(6,621	)		(6,621	)
Net loss		-			-			-		-		-			-			-		-		(6,621	)		(6,621	)

Balance, June 30, 2022 (unaudited)		22,094,889		$	22			9,113,393	$	9		(433,333	)	$	(433	)	$	152,535	$	2	$	(191,198	)	$	(39,063	)
Balance		22,094,889		$	22			9,113,393	$	9		(433,333	)	$	(433	)	$	152,535	$	2	$	(191,198	)	$	(39,063	)

The accompanying notes are an integral part of these condensed financial statements.

Genelux Corporation

Condensed Statements of Cash Flows

(In thousands)

	2023			2022
	Six Months Ended
	June 30,
	2023			2022
	(Unaudited)
Cash Flows from Operating Activities
Net loss	$	(16,185	)	$	(6,621	)

Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		271			277
Right-of-use asset		274			205
Amortization of debt discount		649			99
Stock compensation		467			669
Fair value of restricted stock units		627			-
Cost of stock option repricing		2,642			-
Debt extinguishment costs		402			-
Fair value of warrants issued in connection with the conversion of convertible notes payable		3,110			-
Gain on forgiveness of PPP loan payable		-			(314	)
Changes in Assets and Liabilities
(Increase) Decrease in:
Prepaid expenses and other assets		(48	)		(514	)
(Decrease) Increase in:
Accounts payable and accrued expenses		(1,658	)		940
Accrued compensation		(168	)		12
Accrued interest payable		44			388
Deferred revenue		(170	)		5,460
Lease liability		(265