CBUS 10-K & 10-Q changes, risk factors and insider trading

Cibus’ business is currently primarily focused on R&D of plant gene editing.editing and advancing its commercial strategies with seed company customers. While Cibus has established commercial relationships with seed company counterparties, it presently does not have any revenue generating commercial contract with such seed companies. Accordingly, the Company has only a limited operating history upon which to evaluate its business and long-term prospects.

In the absence of significant additional financing, there will likely continue to be substantial doubt about Cibus’ ability to continue as a going concern. To finance Cibus’ continued operations under its current business plan over the next 12 months, Cibus will need to raise additional capital in addition to incremental proceeds raised pursuant to its ongoing at-the-market (ATM) equity program.capital. Such financing may not be available within Cibus’ required timeframes, on acceptable terms, or at all. Furthermore, the Company’s ability to raise additional capital may be limited by applicable SEC rules and Nasdaq shareholder approval requirements.

In light of the foregoing needs and constraints on the Company’s capital resources, its Board of Directors willwill, together with its professional advisors, continue to evaluate a full range of strategic alternatives to maximize shareholder value, which may include potential equity or debt financing transactions, business combination transactions (including an acquisition or merger transaction), sales of assets, licensing, and other strategic transactions. Certain potential strategic transaction alternatives could (i) result in substantial additional dilution to existing stockholders, (ii) result in the issuance of securities with preferences over Cibus’ existing Common Stock, (iii) subject the Company to covenants that impose operational restrictions, (iv) require it to relinquish potentially valuable rights to pipeline traits or proprietary technologies, (v) result in the granting of licenses on terms that are not favorable to the Company, or (vi) have a material adverse effect on the market price of the Class A Common Stock.

Cibus’ ability to compete depends on its ability to anticipate market demands and responsively innovate in an efficient manner. At the heart of Cibus’ innovation activities is its proprietary RTDS technologies. If Cibus’ competitors are able to refine existing alternative gene editing technologies to be, or develop new gene editing technologies that are, superior to its RTDS technologies, Cibus may face reputational damage and a decline in the demand for its products. This risk is exacerbated by competitors’ increasing use of AI technology to rapidly develop and enhance existing technologies.

The Company’s Restructuringstreamlined Initiativebusiness focus may result in operational and strategic challenges.

On October 18, 2024, Cibus announced its Restructuring Initiative, which included aCost reduction inactions itsassociated workforcewith bythis approximatelystreamlined 26business full-timefocus, employees,including a reductionrationalization of approximately 14 percent. The Restructuring Initiative was a result of Cibus’ realigned organization, which focuses the allocation of the Company’shuman capital resources toward its commercial effort priorities through advancement of Cibus’ weed management traits HT1 and HT3certain fornon-core Rice, Sclerotinia resistance trait for Soybean and Canola, and the continuing development of its Soybean platform, while enabling continued progress on its PSR trait and its third weed management trait HT2 with a more streamlined use of resources. Headcount reductions, whichfacilities, may result in the loss of institutional knowledge and expertise, may adversely affect operations and yield unintended consequences, such as unplanned attrition beyond Cibus’ intended reductions and reduced employee morale. The Company’sCibus’ ability to successfully execute on its strategy depends on retaining key remaining personnel, and unanticipated attrition, which may occur on short notice, could potentially harm the Company’sCibus’ business and operations. As a result of the Restructuring Initiative,result, Cibus’ management may need to divert attention away from day-to-day strategic and operational activities and devote additional time to managing organizational changes. Moreover, although Cibus has recently implemented, and may continue to implement, cost reduction actions, including reductions in its workforce, there can be no assurance that Cibus will be able to achieve its stated cash burn targets in a timely manner, or at all, or that such changes will result in improved cash flow and financial stability.

Cibus’ current headquarters,headquarters as well as its Oberlin Facility, areis located in San Diego, California. At present, Cibus’ R&D operations are also conducted at both its San Diego, California and Roseville, Minnesota facilities.facility. In addition, Cibus’ first generation parent seed is also produced by Cibus staff in greenhouses near its headquarters and hybrids designated for testing are developed using several different cooperators, primarily in Chile.

Factors that may affect Cibus’ ability to effectively license its intellectual property and support its licensee’s commercialization efforts include its ability to: recruit and retain adequate numbers of qualified personnel, effectively develop relationships with potential licensee customers in the seed industry, secure license agreements with companies requiring them to undertake specific commercialization activities within specified timeframes, and persuade downstream farmers to purchase and use seed products that integrate Cibus licensed intellectual property. Developing and maintaining such capabilities requires significant investment, is time consumingconsuming, and could delay the licensing of Cibus’ intellectual property with respect to productivity traits or the commercial launch of its licensees’ seed products.

Cibus’ financial statements include goodwill as a result of the Merger Transactions. Goodwillwhich could become impaired in the future under certain conditions, and any such impairment may significantly impact Cibus’ results of operations and financial condition.

As of December 31, 2024,2025, Cibus had approximately $253.5$232.5 million in goodwill from the Mergermerger Transactions.with Cibus Global. In accordance with ASC 350, Goodwill and Other, the Company evaluates the carrying value of goodwill for impairment annually as of November 1. On November 1, 2024,2025, Cibus performed its annual impairment analysis and determined there was no change from the preceding analysis, which occurred on SeptemberMarch 30,31, 2024,2025, and no additional impairment was triggered related to this annual review.

In addition to its annual analysis, Cibus also assesses goodwill between annual evaluations if events occur or circumstances change that would more likely than not reduce the fair value of goodwill below its carrying amount. DuringFor example, during the thirdfirst quarter of 2024,2025, the Company experienced a triggering event and assessed its goodwill for impairment. Cibus considered the decline in market capitalization of its stockClass priceA Common Stock since its last annual assessment and concluded it was more likely than not that its goodwill would be impaired. The Company determined its goodwill was impaired by $181.4$21.0 million, which was recorded during the thirdfirst quarter of 20242025 in the accompanying consolidated statements of operations.

Seasonality also relates to the limited windows of opportunity that farmers have to complete required tasks at each stage of crop cultivation. Weather and environmental conditions and natural disasters, such as heavy rains, hurricanes, hail, floods, tornadoes, freezing conditions, excessively hot or cold weather, drought, or fire, affect decisions by farmers about the types and amounts of seeds to plant and the timing of harvesting and planting such seeds. Climate change may increase the frequency or intensity of extreme weather such as storms, floods, heat waves, droughts and other events that could affect demand. Climate change may also affect the availability and suitability of arable land and contribute to unpredictable shifts in the average growing season and types of crops produced. Should adverse conditions occur during key growing and harvesting seasons, such conditions could substantially impact demand for agricultural inputs. Any delayed or cancelled orders as a result of such conditions would negatively affect the quarter in which they occur and cause fluctuations in Cibus’ operating results.

Although the regulatory framework applicable to Cibus and its trait products in several strategically important jurisdictions, such as the United States, Canada, and certain Latin American countries, is currently favorable,favorable and positive developments in the regulatory framework in the EU (except with respect to HT traits) are poised for adoption, there can be no guarantee that the governing regulations in such jurisdictions will not change. Governments of, or regulators within, such jurisdictions could institute new laws or regulations, modify existing laws or regulations, or change the way they interpret existing laws and regulations, in each case, in a way that subjects Cibus and its trait products to more burdensome standards. If the regulatory frameworks in strategically important jurisdictions changes in a manner adverse to the Company’s interests, this could substantially increase the time and costs associated with required regulatory activities of Cibus and its customers. If the regulatory burden and expense required for the utilization of Cibus’ products becomes too significant, its customers may seek alternatives that involve lesser regulatory costs.

The regulatory environment varies greatly from region-to-region and in many countries is less developed than in the United States and the European Union.States.

Outside of the United States and the EU,States, the regulatory environment around gene editing in plants and microorganisms is uncertaincharacterized by greater uncertainty and variesvariability, with regulations often varying greatly from jurisdiction-to-jurisdiction. Each jurisdiction may have its own regulatory framework regarding GMOs, which may include restrictions and regulations on planting and growing genetically modified plants and in the consumption and labeling of genetically modified foods, which may encapsulate products containing Cibus licensed intellectual property. Although there has generally been a positive regulatory trend toward the acceptance of non-transgenic gene editing technologies, Cibus cannot predict how the global regulatory landscape regarding gene editing in plants will evolve, and Cibus may incur increased regulatory costs as regulations change in the jurisdictions in which it operates.

Products containing Cibus’ productivity traits may be subject to enhanced regulation.

Some products containing Cibus’ productivity traits may be subject to FDA food product regulations or EPA environmental impact regulations. Under the FDA, any substance that is reasonably expected to become a food or animal feed component or additive is subject to FDA premarket review and approval, unless generally recognized among qualified experts as having been adequately shown to be Generally Regarded As Safe (GRAS) or the use of the substance is otherwise excluded from the “food additive” definition. The FDA may classify some or all of Cibus’ productivity traits as containing a food additive that is not GRAS or otherwise determine that further review is required. Such classification would cause these productivity traits to require premarket approval, which could delay a licensee customer’s commercialization of products containing these productivity traits.

In addition to contractual measures, Cibus tries to protect the confidential nature of its proprietary information using physical and technological security measures. Such measures may not provide adequate protection for Cibus’ proprietary information. For example, there have been reported cases in the industry where productivity trait or sustainable ingredient candidates have been stolen from the field during field trials. Cibus’ security measures may not prevent an employee or consultant with authorized access from misappropriating Cibus’ trade secrets and providing them to a competitor, and the recourse Cibus has available against such misconduct may not provide an adequate remedy to protect its interests fully. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret can be difficult, expensive, and time consuming, and the outcome is unpredictable. In addition, courts outside the United States may be less willing to protect trade secrets. Furthermore, Cibus’ proprietary information may be independently developed by others in a manner that could prevent legal recourse by Cibus. If any of Cibus’ confidential or proprietary information, including its trade secrets, were to be disclosed or misappropriated, or if any such information was independently developed by a competitor, Cibus’ competitive position could be harmed and its business could be materially and adversely affected.

The laws of some foreign countries do not protect intellectual property rights to the same extent as the laws of the United States. Patent protection must be sought on a country-by-country basis, which is an expensive and time consuming process with uncertain outcomes. Accordingly, Cibus and its licensors may choose not to seek patent protection in certain countries, and Cibus will not have the benefit of patent protection in such countries. In addition, the legal systems of some countries, particularly developing countries, do not favor the enforcement of patents and other intellectual property protection, especially those relating to biotechnologies, and the requirements for patentability differ, in varying degrees, from country-to-country, and the laws of some foreign countries do not protect intellectual property rights, including trade secrets, to the same extent as federal and state laws of the United States. As a result, many companies have encountered significant problems in protecting and defending intellectual property rights in certain foreign jurisdictions. Such issues may make it difficult for Cibus to stop the infringement, misappropriation, or other violation of its intellectual property rights. For example, many foreign countries, including the EU countries, have compulsory licensing laws under which a patent owner must grant licenses to third parties. In addition, many countries limit the enforceability of patents against third parties, including government agencies or government contractors. In these countries, patents may provide limited or no benefit. In those countries, Cibus and its licensors may have limited remedies if patents are infringed or if Cibus or its licensors are compelled to grant a license to a third party, which could materially diminish the value of those patents. This could limit Cibus’ potential revenue opportunities. Accordingly, Cibus’ and its licensors’ efforts to enforce intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that Cibus owns or licenses. Similarly, if Cibus’ trade secrets are disclosed in a foreign jurisdiction, competitors worldwide could have access to Cibus’ proprietary information and Cibus may be without satisfactory recourse. Such disclosure could have a material adverse effect on Cibus’ business. Moreover, Cibus’ ability to protect and enforce its intellectual property rights may be adversely affected by unforeseen changes in foreign intellectual property laws.

Certain directors and officers of Cibus are beneficiaries of the Royalty Liability. The financial interest of such directors and officers under the Royalty Liability may create real or perceived conflicts of interest between stockholders’ interests and those of such affiliates. In addition, once the Company generates sufficient revenue to trigger royalty payments under the Royalty Liability, the satisfaction of such payment obligations and the interest expense related thereto may adversely affect the cash flow available for Cibus’ operations, particularly in connection with the initial payment of aggregated, but unpaid, royalty payment amounts. Further, even prior to the Company having payment obligations in respect of the Royalty Liability, fluctuations in the liability balance of the Royalty Liability due to changes in Cibus’ business model and anticipated Subject Revenues (as defined belowin the Warrant Exchange Agreement) from productivity trait or sustainable ingredient candidates in development could cause the value of Cibus’ securities to fluctuate, which may limit or prevent investors from readily selling their Class A Common Stock at a favorable price, or at all, and may otherwise negatively affect the liquidity of the Class A Common Stock.

Despite the implementation of security measures, Cibus’ internal computer systems, and those of third parties on which Cibus relies, are vulnerable to damage from computer viruses, malware, natural disasters, terrorism, war, telecommunication and electrical failures, cyber-attacks or cyber-intrusions over the Internet, attachments to emails, persons inside its organization, or persons with access to systems inside its organization. While Cibus does not believe that it has experienced any such material system failure, accident, or security breach to date, if such an event were to occur and cause interruptions in its systems, it could result in a material disruption of Cibus’ operations. For example, the loss of field trial data for Cibus’ productivity trait or sustainable ingredient candidates could result in delays in Cibus’ commercialization efforts and significantly increase Cibus’ costs to recover or reproduce the data. Additionally, there have been reported cases in the industry where productivity trait or sustainable ingredient candidates have been stolen from the field during field trials. To the extent that any disruption or security breach results in a loss of or damage to Cibus’ data or applications or other data or applications relating to its technology or productivity trait or sustainable ingredient candidates, or inappropriate disclosure of confidential or proprietary information, Cibus could incur liabilities, damage to its reputation, and the further development of its productivity trait or sustainable ingredient candidates could be delayed. See “Item 1.C. Cybersecurity” for additional information related to cybersecurity risks and how Cibus manages such risks.

The Company completed a Section 382 analysis through December 31, 2023, and it was determined that the Company experienced an IRC 382 cumulative shift as of 5/31/May 31, 2023, as a result of the Mergermerger Transactions.with Cibus Global. The Company completed an additional analysis through each of December 31, 2025, and 2024, to determine if any additional cumulative shifts have occurred and concluded no Section 382 ownership change was identified in either 2025 or 2024. For financial statement purposes, the Company has included the federal and state NOLs and R&D credit in the schedule of deferred tax assets offset with a full valuation allowance. If eliminated, the related asset would be removed from the deferred tax asset schedule with a corresponding reduction in the valuation allowance. Due to the existence of the valuation allowance, limitations created by historical ownership changes will not impact the Company’s effective tax rate in the future. There is no assurance that Cibus will not experience additional ownership changes under Section 382 that would further limit or possibly eliminate its ability to use its NOLs. In addition, Cibus may experience ownership changes as a result of shifts in the direct or indirect ownership of its stock, some of which may be outside of its control. There is also a risk that future legal or regulatory changes may limit Cibus’ ability to use current or future NOLs to offset its future federal income tax liabilities.

Cibus is a holding company and its only material asset is its interest in Cibus Global, and it is accordingly dependent upon distributions from Cibus Global to pay taxes, make payments under the Tax Receivable Agreement,taxes and cover its corporate and other overhead expenses.

As of the date of the filing of this Annual Report, all of the Up-C Units (each consisting of one share of Class B Common Stock and one Cibus Common Unit) have been exchanged for shares of Class A Common Stock and, accordingly, Cibus is now the sole holder of Cibus Common Units and owns 100 percent of Cibus Global. Cibus is a holding company with no material assets other than its ownership of Cibus Common Units. As a result, Cibus has no independent means of generating revenue or cash flow. Cibus’ ability to pay taxes, make payments under the Tax Receivable Agreement,taxes and cover its corporate and other overhead expenses depends on the financial results and cash flows of Cibus Global and its subsidiaries and the distributions that Cibus receives from Cibus Global. Deterioration in the financial condition, earnings, or cash flow of Cibus Global and its subsidiaries, for any reason, could limit or impair Cibus Global’s ability to pay such distributions. Additionally, to the extent that Cibus needs funds and Cibus Global and/or any of its subsidiaries are restricted from making such distributions under applicable law or regulation or under the terms of any financing arrangements, or Cibus Global is otherwise unable to provide such funds, it could materially adversely affect Cibus’ liquidity and financial condition.

Cibus acquired certain favorable tax attributes from certain Blockers in the Blocker Mergers. In addition, future redemptions or exchanges of Cibus Common Units for shares of Class A Common Stock or cash, and other transactions described herein, are expected to resultresulted in favorable tax attributes for Cibus. These tax attributes would not behave been available to Cibus in the absence of those transactions and are expected to reduce the amount of tax that Cibus would otherwise be required to pay in the future.

Cibus entered into the Tax Receivable Agreement, pursuant to which Cibus generally is required to pay to the TRA Parties, in the aggregate, 85 percent of the net income tax savings that Cibus actually realizes (or in certain circumstances, is deemed to realize) as a result of (i) certain favorable tax attributes Cibus acquired from the Blockers in the Blocker Mergers (including net operating losses), (ii) increases to Cibus’ allocable share of the tax basis of Cibus Global’s assets resulting from future redemptions or exchanges of Cibus Common Units for shares of Class A Common Stock or cash, (iii) tax attributes resulting from certain payments made under the Tax Receivable Agreement and (iv) deductions in respect of interest under the Tax Receivable Agreement. The payment obligations under the Tax Receivable Agreement are Cibus’ obligations and not obligations of Cibus Global.

In addition, the Tax Receivable Agreement provides that if (1) Cibus breaches any of its material obligations under the Tax Receivable Agreement (including in the event that Cibus is more than three months late making a payment that is due under the Tax Receivable Agreement, except in the case of certain liquidity exceptions), (2) Cibus is subject to certain bankruptcy, insolvency, or similar proceedings, (3) upon certain mergers, asset sales, or other forms of business combination, or certain other changes of control, or (4) at any time, Cibus elects an early termination of the Tax Receivable Agreement, Cibus’ obligations under the Tax Receivable Agreement (with respect to all Cibus Common Units, whether or not such units have been exchanged or redeemed before or after such transaction) would accelerate and become payable in a lump sum amount equal to the present value of the anticipated future tax benefits calculated based on certain assumptions, including that Cibus would have sufficient taxable income to fully utilize the deductions arising from the tax deductions, tax basis, and other tax attributes subject to the Tax Receivable Agreement. As a result, upon any acceleration of Cibus’ obligations under the Tax Receivable Agreement and upon a change of control, Cibus could be required to make payments under the Tax Receivable Agreement that are greater than 85 percent of its actual cash tax savings, which could negatively impact its liquidity. The change of control provisions in the Tax Receivable Agreement may also result in situations where the Cibus Global equityholders and the relevant Blocker Owners that are TRA Parties will have interests that differ from or are in addition to those of the other holders of Class A Common Stock.

Finally, because Cibus is a holding company with no operations of its own, its ability to make payments under the Tax Receivable Agreement depends on the ability of Cibus Global to make distributions to it. To the extent that Cibus is unable to make payments under the Tax Receivable Agreement for any reason, such payments will be deferred and will accrue interest until paid, which could negatively impact Cibus’ results of operations and could also affect its liquidity in periods in which such payments are made.

Cibus is a leading agricultural biotechnology company that uses proprietary gene editing technologies to develop plant traits, which are specific genetic characteristics in the DNA of a plant’s seed. These characteristics influence how a resulting plant functions and/or interacts with its environment. ItsCibus’ primary business is the development of plant traits for some of the world’s major agricultural food crops that help address specific productivity, profitability, sustainability, or yield challenges in farming. These plant traits can be licensed to global seed companies where the licensee company will include these traits in their seed products and for that Cibus will receive an annual royalty for seed sold, usually structured as a per-acre planted royalty. This is not a new business model as many companies have developed traits that have been added to seed products and have garnered significant royalties for their developers over many years. Importantly, farmers are well acquainted with the value of these seeds with traits. Cibus’ initial focus is on productivity traits, which can be associated with improving crop yields in the face of challenges such as weeds, pests, and diseases, can address environmental challenges with an overall reduction in the use of chemicals like fungicides, insecticides, or fertilizers, or can make crops more adaptable to environmental factors such as heat and drought in the face of climate change. In the near term, Cibus’ priority pipeline program centers on Rice herbicide tolerance (HT) traits and sustainable ingredients opportunities.

In January 2025, the Company (i) issued 4,340,000 shares of its Class A Common Stock and,and (ii) in lieu of Class A Common Stock issued to oneMr. of the Company’s then executive officersRiggs and other investors, pre-funded warrants (2025 Pre-Funded Warrants) to purchase 4,700,000 shares of Class A Common StockStock, bothin each case, together with an accompanying common warrant (2025 Common Warrants) to purchase up to 4,340,000 shares of Class A Common Stock and 4,700,000 shares of Class A Common Stock, respectively, in a registered direct offering (January 2025 Follow-On Offering). The combined offering price for each share of Class A Common Stock and the accompanying 2025 Common Warrant was $2.50. The combined offering price for each 2025 Pre-Funded Warrant and the accompanying 2025 Common Warrant was $2.4999. The 2025 Common Warrants have an exercise price of $2.50 per share of Class A Common Stock and are onlybecame exercisable afterupon theapproval Companyby receivesCibus’ certainstockholders approvalson fromMay its22, stockholders.2025. The 2025 Common Warrants will beare exercisable for five years following the dateMay of22, receipt of certain2025, stockholder approvals,approval, subject to beneficial ownership limitations.limitations included in the terms of such securities. The 2025 Pre-Funded Warrants were immediately exercisable at the time ofupon issuance and will beare exercisable until they are fully exercised at antheir exercise price of $0.0001 per share of Class A Common Stock, subject to beneficial ownership limitations. Through the date of this filing, theThe Company has received net proceeds related to the January 2025 Follow-On Offering of approximately $21.4 million after deducting approximately $1.2 million for theplacement underwriting discounts andagent commissions and other offering expenses payable by the Company. During the year ended December 31, 2025, 4,300,000 2025 Pre-Funded Warrants were exercised.

The Company’s ability to generate substantial revenue from plant traits depends upon the ability to further expand its Trait Machine process/RTDS platforms, which are fundamental for multiple different plant traits. The Company is advancing the licensing for commercialization by seed companies of traits developed using RTDS and currently has three developed traits for two global crops.RTDS.

The company’s R&D expenses primarily consist of expenses incurred while performing activities to discover and develop potential product candidates and to establish and improve Trait Machine processprocesses/RTDS platforms such as:

The Company’s R&D efforts are driven by the Company’s realignedstreamlined organization,business whichfocus, focuses the allocation ofallocating its capital resources toward its commercial effort priorities through advancement of Cibus’ weed management productivity traits HT1 and HT3 for Rice, Sclerotiniabiofragrance resistanceproducts productivity trait for Canolaprogram, and Soybean,its andcrop thebased continuingsustainable developmentingredients of Cibus’ Soybean platform,work, while enabling continuedfuture progresspipeline on Cibus’ PSR productivity trait and its third weed management productivity trait HT2 with a more streamlined use of resources.opportunities. The Company’s infrastructure resources are utilized across multiple R&D programs. In addition, employees typically work across multiple R&D programs. The Company manages certain activities, such as field trials and seed production, through third party vendors. Due to the number of ongoing projects and its ability to use resources across several projects, it does not record or maintain information regarding the costs incurred for its R&D programs on a program-specific basis.

The Company’s R&D efforts are central to its business and account for a significant portion of its operating expenses. With the Company’s realignedstreamlined organizationbusiness focus, R&D expenses are expected to remain flat, except for inflation considerations,decrease for the foreseeableimmediate future. Additionally, product candidates in later stages of development generally have higher development costs than those in earlier stages of development, primarily due to the increased expense associated withThe large-scale field testing and seed increases (small scale and large-scale) for trait validation.validation in the near term will primarily be centered around Rice.

Selling, general, and administrative (SG&A) expense consists primarily of employee-related expenses, such as salaries for its executive, business development, legal, intellectual property, information technology, finance, human resources, and other administrative functions. These costs include legal, professional, and consulting fees for external firms and contractors. All selling and marketing expenses, including advertising expenses and allocated facility costs including rent, utilities, maintenance expenses, and depreciation and amortization, are included in SG&A expense in the accompanying consolidated statements of operations.

The Company evaluates the carrying value of goodwill and indefinite-lived intangible assets for impairment annually as of November 1 each year in accordance with Accounting Standards Codification (ASC) Topic 350, Intangibles—Goodwill and Other, and between annual evaluations if events occur or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying amount. Such circumstances could include, but are not limited to (1) a significant adverse change in legal factors or in business climate, (2) unanticipated competition, or (3) an adverse action or assessment by a regulator.

Non-Operating Income (Expense),Income, net

Non-operating income (expense),income, net are income or expenses that are not directly related to ongoing operations and are primarily comprised of gains and losses from the fair value adjustment of the Common Warrants (as defined in Note 1 to the accompanying consolidated financial statements).

Revenue was $4.3$3.6 million in 2024,2025, ana increasedecrease of $2.4$0.6 million from 2023.2024. The increasedecrease was driven by the acquisition of Cibus Global revenue which included amounts earned from collaboration agreements related to contract research for Rice and Soybean.Sustainable Revenue from operations associated with Legacy Calyxt in 2024 and 2023 was primarily associated with the Company’s agreement with a large food ingredient manufacturer to develop a palm oil alternative.Ingredients.

Goodwill and Intangible Assets Impairment

Goodwill and intangible assets impairment was $181.4$21.0 million in 2024,2025, a decrease of $68.0$160.5 million from 2023.2024. The decrease was due to the impairment of goodwill resulting from a fair value assessment,assessments, based on the decline of the Company’s stock price, performed in the first quarter of 2025 and in the third quarter of 2024 versus the impairment in the fourth quarter of 2023.2024.

Royalty liability interest expense - related parties was $34.2$35.5 million in 2024,2025, an increase of $15.3$1.3 million from 2023.2024. The increase was due to the assumption of the Royalty Liability as part of the Merger Transactions, which was primarilyis driven by the recognition of seven months of interest expense inon 2023the andaccumulating aRoyalty fullLiability year of interest expense in 2024.balance.

Other interest income, net was $0.6$0.4 million in 2024,2025, ana increasedecrease of $0.1$0.2 million from 2023.2024. The increasedecrease was driven by interest earned onlower cash balances.

Non-Operating Income (Expense),Income, net

Non-operating income (expense),income, net was income of $9.3$0.4 million in the2025, 2024,a an increase in incomedecrease of $9.7$8.9 million from 2023.2024. The increase in incomedecrease was driven by the fair value adjustment of the Common Warrants (as defined in Note 1 to the accompanying consolidated financial statements).

Net Loss Attributable to Noncontrolling Interest and Redeemable Noncontrolling Interest

Net loss attributable to noncontrolling interest and redeemable noncontrolling interest was $31.3$5.1 million in 2024,2025, a decrease in net loss attributable to noncontrolling interest and redeemable noncontrolling interest of $38.7$26.2 million from 2023.2024. The decrease in net loss attributable to noncontrolling interest and redeemable noncontrolling interest is a result of theless Up-C Units createdUnits, as part of the closing of the Merger Transactions, and the amount for the period is based on the percentage of Cibus Global that is not owned by Cibus, Inc.

The Company’s liquidity funds its non-discretionary cash requirements and its discretionary spending. The Company has contractual obligations related to recurring business operations, primarily related to lease payments for its corporate and laboratory facilities. The Company’s principal discretionary cash spending is for salaries, capital expenditures, short-term working capital payments, and professional and other transaction-related expenses incurred as the Company pursues additional financing. Until the Company is able to obtain additional public or private financing, it currently expects to satisfy its near-term requirements with existing cash on hand and proceeds raised from the ATM Facility.hand.

There have been no material changes in risk factors from those disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 17, 2026.Report.

The Company has incurred net losses since its inception. As of MarchJune 31,30, 2026, the Company had an accumulated deficit of $879.5$901.6 million. The Company’s net loss was $21.2$43.4 million for the threesix months ended MarchJune 31,30, 2026. As Cibus continues to develop its pipeline of productivity traits and as a result of its limited commercial activities, Cibus expects to continue to incur significant expenses and operating losses for the next several years. Those expenses and losses may fluctuate significantly from quarter-to-quarter and year-to-year.

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCHJUNE 31,30, 2026, COMPARED TO THE THREE MONTHS ENDED MARCHJUNE 31,30, 2025

A summary of the Company’s results of operations for the three months ended MarchJune 31,30, 2026, and 2025 follows:

Revenue was $1.7$1.0 million in the firstsecond quarter of 2026, an increase of $0.6$0.1 million from the firstsecond quarter of 2025. The increase was driven by amounts earned from collaboration agreements related to contract research for Sustainable Ingredients.

R&D expense was $8.7$8.5 million in the firstsecond quarter of 2026, a decrease of $3.1$3.7 million from the firstsecond quarter of 2025. The decrease was primarily due to cost reduction initiatives.

Selling,Royalty general,liability and administrative (SG&A)interest expense - related parties was $5.1$9.5 million in the firstsecond quarter of 2026, aan decreaseincrease of $4.8$0.8 million from the firstsecond quarter of 2025. The decreaseincrease wasis primarilydriven dueby tothe arecognition $3.0of million litigationinterest expense inon the firstRoyalty quarterLiability ofand 2025is asconsistent wellwith asthe costprior reduction initiatives.year.

There was no goodwill impairment in the first quartersix months of 2026, a decrease of $21.0 million from the first quartersix months of 2025. The decrease was due to the impairment of goodwill resulting from fair value assessments, based on the decline of the price of the Company’s stockClass price,A Common Stock, performed in the first quarter of 2025.

Royalty liability interest expense - related parties was $9.1$18.6 million in the first quartersix months of 2026, an increase of $0.7$1.6 million from the first quartersix months of 2025. The increase is driven by the recognition of interest expense on the accumulating Royalty Liability balance.

Other interest income, net was nominal$0.1 million in the first quartersix months of 2026, a decrease of $0.1 million from the first quartersix months of 2025. The decrease was driven by lower cash balances.

Non-Operating (Expense) Income, net

Non-operating (expense) income, net was nominal$0.1 million in the first quartersix months of 2026, a decrease of $0.4$0.3 million in income from the first quartersix months of 2025. The decrease in income was driven by the fair value adjustment of liability classified common warrants..warrants partially offset by grant income towards work performed by Cibus.

There was no net loss attributable to noncontrolling interest in the first quartersix months of 2026, a decrease in net loss attributable to noncontrolling interest of $2.5$3.7 million from the first six months of 2025. The decrease in net loss attributable to noncontrolling interest is a result of all Up-C Units being exchanged in 2025, as the amount for the period is based on the percentage of Cibus Global that is not owned by Cibus, Inc.

The Company’s liquidity funds its non-discretionary cash requirements and its discretionary spending. The Company has contractual obligations related to recurring business operations, primarily related to lease payments for its corporate and laboratory facilities. The Company’s principal discretionary cash spending is for salaries, capital expenditures, short-term working capital payments, and professional and other transaction-related expenses incurred as the Company pursues additional financing. Until the Company is able to obtain additional public or private financing, it currently expects to satisfy its near-term requirements with existing cash on hand.hand and proceeds raised from the ATM Facility, defined below.

As of MarchJune 31,30, 2026, the Company had $30.3$20.4 million of cash and cash equivalents. Current liabilities were $13.9$14.4 million as of MarchJune 31,30, 2026. The Company incurred a net loss of $21.2$43.4 million for the threesix months ended MarchJune 31,30, 2026. As of MarchJune 31,30, 2026, the Company had an accumulated deficit of $879.5$901.6 million and expects to continue to incur losses in the future.

Net cash used in operating activities was $11.5$20.9 million in the first threesix months of 2026, a decrease in cash used of $0.3$4.5 million from the first threesix months of 2025. The decrease in cash used is driven by a $3.9$8.2 million decrease in net loss, primarily related to an increase of $0.6$0.7 million in revenue and $0.1 million in non-operating income in addition to cost reduction initiatives including decreases of $1.1 million in professional fees, $1.0$2.6 million in personnel and travel related expenses, $0.9$1.9 million in facilities and other officecorporate expenses, $1.8 million in professional fees, and $0.3$1.1 million in lab supplies.supplies and field trials. The improved net loss is offset by a decrease of $3.6$3.7 million from the changes in operating assets and liabilities. The decrease is due to $1.3 million higher accounts receivable, $1.9$2.3 million lower accounts payable and accrued expenses, $0.7$1.2 million lower right-of-use assets and liabilities due to the end of Nancy Ridge rent abatement, and$0.4 $0.3million higher accounts receivable, $0.2 million lower prepaid expenses.expenses, and $0.1 million lower deferred revenue.

Net cash used in investing activities was $0.1 millionnominal in the first threesix months of 2026, a decrease of $0.2$0.4 million from the first threesix months of 2025. The decrease in cash used was driven by a decrease in purchases of property, plant, and equipment from the prior year.

Net cash provided by financing activities was $32.0$31.4 million in the first threesix months of 2026, ana increasedecrease of $10.7$16.4 million from the first threesix months of 2025. The increasedecrease was primarily due to ana increasedecrease of $10.9$16.2 million of net proceeds from additionalless capital raised in 2026.

In January 2026, the Company issued 14,836,664 shares of its Class A Common StockStock, including 333,333 shares issued to Mr. Riggs (January 2026 Follow-On Offering). The offering price for each share of Class A Common Stock was $1.50. The Company received net proceeds related to the January 2026 Follow-On Offering of approximately $19.8 million after deducting approximately $2.5 million for underwriting discounts and commissions and certain other offering expenses payable by the Company.