U. S.   UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DCWashington, D.C. 20549
 
FORM 10-Q/A
(Amendment No.1)
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, 2020.
March 31, 2021.
 
☐
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
For the transition period from _____ to _____.
 
Commission File Number 0000-08092001-40023
 
GT BIOPHARMA, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of
incorporation or organization)
94-1620407
(I.R.S. employerEmployer
identification number)Identification Number)
 
9350 Wilshire Blvd. Suite 203
Beverly Hills, CA 90212
 (Address of principal executive offices and zip code)
 
(800) 304-9888
(Registrant’s telephone number, including area code)
 
N/A
 (Former(Former name, former address and former fiscal year, if changed since last report)
 
Securities registered pursuant to Section 12(b) of the Act:
 
Title of Each Class Trading Symbol Name of exchange on which registered
N/ACommon Stock, $0.001 par value per share N/AGTBP N/ANasdaq
 
Indicate by check mark whether the registrant (1) has 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 every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  ☑ No  ☐
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
 
Large accelerated filer ☐Accelerated filer ☐
Non-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 ☑
 
As of August 11, 2020,May 12, 2021, the issuer had 76,560,86221,127,718 shares of common stock outstanding.
 

EXPLANATORY NOTE
We are filing this Amendment No. 1 to the Quarterly Report on Form 10-Q for the quarter ended June 30, 2020 of GT Biopharma, Inc. (the “Original Form 10-Q”), as filed with the Securities and Exchange Commission on August 14, 2020 to correct certain clerical errors in the Original Form 10-Q. The Original Form 10-Q, as amended, reads in its entirety as set forth below.
 
 
 
GT Biopharma, Inc. and Subsidiaries
FORM 10-Q
For the Quarter Ended June 30, 2020March 31, 2021
Table of Contents
 
PART I  FINANCIAL INFORMATION
 Page 
    
Item 1.
Financial Statements
 1
 
 
Condensed Consolidated Balance Sheets as of June 30, 2020March 31, 2021 (Unaudited) and December 31, 20192020
 1 
 
Condensed Consolidated Statements of Operations for the three and six months ended June 30,March 31, 2021 and 2020 and 2019 (Unaudited)
 22
Condensed Consolidated Statements of Stockholders' Equity (Deficit) (unaudited)
3 
 
Consolidated Statements of Cash Flows for the sixthree months ended June 30,March 31, 2021 and 2020 and 2019 (Unaudited)
 3
Consolidated Statements of Stockholders' Deficit
4 
 
Condensed Notes to Consolidated Financial Statements
 5
 
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
 16 
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
 2119 
Item 4.
Controls and Procedures
 2120
 
PART II  OTHER INFORMATION
 
Item 1.
Legal Proceedings
 21 
Item 1A.
Risk Factors
 2221 
Item 2.
Unregistered Sales of Securities and Use of Proceeds
 2221 
Item 3.
Defaults Upon Senior Securities
  2221
 
Item 4.
Mine Safety Disclosures
 2221 
Item 5.
Other Information
  22
 
Item 6.
Exhibits
 23 
SIGNATURES

 24 
 
 
 
 
 
GT Biopharma, Inc. and Subsidiaries
as of June 30, 2020 and December 31, 2019BIOPHARMA, INC AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in Thousands, Except Par Value and Share Data)
 
 
March 31,
 
 
December 31,
 
 
 
2021
 
 
2020
 
ASSETS:
 
(unaudited)
 
 
 
 
Current assets
 
 
 
 
 
 
  Cash and cash equivalents
 $27,555,000 
 $5,297,000 
  Prepaid expenses
  88,000 
  364,000 
    Total Current Assets
 $27,643,000 
 $5,661,000 
 
    
    
 
    
    
 
    
    
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
    
    
 
    
    
Current liabilities
    
    
  Accounts payable
 $2,377,000 
 $2,243,000 
  Accrued expenses
  856,000 
  1,296,000 
  Accrued interest
  - 
  4,838,000 
 Convertible notes payable (net of discount of $4,519,000 at December 31, 2020)
  - 
  26,303,000 
  Line of Credit
  31,000 
  31,000 
  Derivative liability
  362,000 
  383,000 
      Total current liabilities
  3,626,000 
  35,094,000 
 
    
    
 
    
    
Stockholders' Equity (Deficit):
    
    
 
    
    
Convertible Preferred stock, par value $0.01, 15,000,000 shares authorized:
    
    
Series C - 96,230 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively
  1,000 
  1,000 
Series J - 0 and 2,353,548 shares issued and outstanding at March 31, 2021 and December 31, 2020 , respectively
  - 
  2,000 
Series K- 0 shares issued and outstanding at March 31, 2021 and December 31, 2020 , respectively
  - 
  - 
Common stock, par value $0.001, 2,000,000,000 shares authorized, 20,517,431 and 5,218,122 shares issued
    
    
 and outstanding as of March 31, 2021 and December 31, 2020 , respectively
  21,000 
  5,000 
  Common stock issuable, 7,634,000 shares at March 31, 2021
  25,956,000 
  - 
  Additional paid in capital
  623,287,000 
  566,356,000 
  Accumulated deficit
  (625,079,000)
  (595,628,000)
  Non Controlling Interest
  (169,000)
  (169,000)
     Total stockholders' equity (deficit)
  24,017,000 
  (29,433,000)
 
    
    
     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
 $27,643,000 
 $5,661,000 
 
 
 
June 30,
2020
 
 
December 31,
2020
 
ASSETS
 
(unaudited)
 
 
 
 
Current Assets:
 
 
 
 
 
 
Cash and cash equivalents
 $851 
 $28 
Prepaid expenses
  120 
  246 
Total Current Assets
  971 
  274 
 
    
    
Intangible assets
  0 
  0 
Deposits
  12 
  12 
Operating lease right-to-use asset
  80 
  110 
Fixed assets, net
  - 
  0 
Total Other Assets
  92 
  122 
TOTAL ASSETS
 $1,063 
 $396 
LIABILITIES AND STOCKHOLDERS’ DEFICIT
    
    
Current Liabilities:
    
    
Accounts payable
 $2,001 
 $1,940 
Accrued expenses
  1,313 
  2,379 
Accrued interest
  3,283 
  2,029 
Operating lease liability
  90 
  120 
Line of credit
  31 
  31 
Convertible notes
  21,844 
  13,207 
Total Current Liabilities
  28,562 
  19,706 
 
    
    
Stockholders’ Deficit:
    
    
Convertible preferred stock - $0.01 par value; 15,000,000 shares authorized:
    
    
Series C - 96,230 and 96,230 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively
  1 
  1 
Series J-1 – 2,353,548 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively
  24 
  24 
Common stock - $0.001 par value; 750,000,000 shares authorized; and 75,435,862 and 69,784,699 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively
  75 
  70 
Additional paid-in capital
  550,389 
  548,096 
Accumulated deficit
  (577,819)
  (567,332)
Noncontrolling interest
  (169)
  (169)
Total Stockholders’ Deficit
  (27,499)
  (19,310)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT
 $1,063 
 $396 

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

GT BIOPHARMA, INC AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
 
 
For the Three Months ended
 
 
 
March 31,
 
 
 
2021
 
 
2020
 
 
 
(unaudited)
 
 
(unaudited)
 
Revenues
 $- 
 $- 
 
    
    
Operating Expenses:
    
    
    Research and development
  1,640,000 
  324,000 
    Selling, general and administrative (including $14,296,000 of stock compensation to officers and directors in 2021)
  27,362,000 
  746,000 
 
    
    
Loss from Operations
  29,002,000 
  1,070,000 
 
    
    
Other (Income) Expense
    
    
    Change in fair value of derivative liability
  (21,000)
  - 
    Interest expense
  696,000 
  638,000 
Total Other Expense, net
  675,000 
  638,000 
 
    
    
Net Loss
 $(29,677,000)
 $(1,708,000)
 
    
    
Net loss per share
    
    
Basic and diluted
 $(1.83)
 $(0.41)
 
    
    
Weighted average common shares outstanding
    
    
Basic and diluted
  16,239,938 
  4,122,178 
The accompanying notes are an integral part of these condensed consolidated financial statements.

GT BIOPHARMA, INC AND SUBSIDIARIES
Condensed Consolidated Statements of Stockholders' Equity (Deficit) (unaudited)
For the three months ended March 31, 2021 and 2020
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Additional
 
 

 
 
Non
 
 
 
 
 
Preferred Shares
 
 
Common Shares
 
 
Common Shares Issuable
 
 
Paid in
 
 
Accumulated
 
 
Controling
 
 
 
 
 
Shares
 
 
Amount
 
 
Shares
 
 
Amount
 
 
Shares
 
 
Amount
 
 
Capital
 
 
Deficit
 
 
Interest
 
 
Total
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance, December 31, 2020
  2,449,778 
 $3,000 
  5,218,122 
 $5,000 
  - 
 $- 
 $566,356,000 
 $(595,628,000)
 $(169,000)
 $(29,433,000)
 
    
    
    
    
    
    
    
    
    
    
Extinguishment of debt discount upon adoption of ASU 2020-06
  - 
  - 
  - 
  - 
    
    
  (4,745,000)
  226,000 
  - 
  (4,519,000)
 
    
    
    
    
    
    
    
    
    
    
Conversion of Preferred Series J to common stock
  (2,353,548)
  (2,000)
  692,220 
  1,000 
    
    
  1,000 
  - 
  - 
  - 
 
    
    
    
    
    
    
    
    
    
    
Common shares issued upon conversion of notes payable
  - 
  - 
  3,779,322 
  4,000 
  7,634,000 
  25,956,000 
  12,846,000 
  - 
  - 
  38,806,000 
 
    
    
    
    
    
    
    
    
    
    
Common shares issued upon exercise of warrants
  - 
  - 
  94,824 
  - 
    
    
  58,000 
  - 
  - 
  58,000 
 
    
    
    
    
    
    
    
    
    
    
Issuance of common stock in public offering, net of cost
  - 
  - 
  4,945,000 
  5,000 
    
    
  24,674,000 
  - 
  - 
  24,679,000 
 
    
    
    
    
    
    
    
    
    
    
Issuance of common stock for research and development agreement
  - 
  - 
  189,753 
  - 
    
    
  1,355,000 
  - 
  - 
  1,355,000 
 
    
    
    
    
    
    
    
    
    
    
Issuance of common stock for services
  - 
  - 
  1,957,374 
  2,000 
    
    
  8,450,000 
  - 
  - 
  8,452,000 
 
    
    
    
    
    
    
    
    
    
    
Equity compensation to officers and board of directors
  - 
  - 
  3,640,816 
  4,000 
    
    
  14,292,000 
  - 
  - 
  14,296,000 
 
    
    
    
    
    
    
    
    
    
    
Net loss
    
    
    
    
    
    
    
  (29,677,000)
    
  (29,677,000)
 
    
    
    
    
    
    
    
    
    
    
Balance, March 31, 2021
  96,230 
 $1,000 
  20,517,431 
 $21,000 
  7,634,000 
 $25,956,000 
 $623,287,000 
 $(625,079,000)
 $(169,000) 
 $24,017,000 
 
    
    
    
    
    
    
    
    
    
    
 
    
    
    
    
    
    
    
    
    
    
Balance, December 31, 2019
  2,449,778 
 $3,000 
  69,784,699 
 $70,000 
  - 
 $- 
 $548,118,000 
 $(567,332,000)
 $(169,000)
 $(19,310,000)
 
    
    
    
    
    
    
    
    
    
    
Common shares issued upon conversion of notes payable
  - 
  - 
  814,734 
  1,000 
    
    
  162,000 
  - 
  - 
  163,000 
 
    
    
    
    
    
    
    
    
    
    
Net loss
    
    
    
    
    
    
    
  (1,708,000)
  - 
  (1,708,000)
 
    
    
    
    
    
    
    
    
    
    
Balance, March 31, 2020
  2,449,778 
 $3,000 
  70,599,433 
 $71,000 
  - 
 $- 
 $548,280,000 
 $(569,040,000)
 $(169,000)
 $(20,855,000)

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

GT BIOPHARMA, INC AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
 
 
For the Three Months Ended
 
 
 
March 31,
 
 
 
2021
 
 
2020
 
 
 
(unaudited)
 
 
(unaudited)
 
CASH FLOWS FROM OPERATING ACTIVITIES:
 
 
 
 
 
 
Net loss
 $(29,677,000)
 $(1,708,000)
Adjustments to reconcile net loss to net cash
    
    
used in operating activities:
    
    
    Change in fair value of derivative liability
  (21,000)
  - 
    Stock based compensation - consultants and research and development
  9,807,000 
  - 
    Stock based compensation - officers and board of directors
  14,296,000 
  - 
    Convertible notes payable issued for consulting services
  720,000 
  - 
Effect of changes in assets and liabilities:
    
    
      Prepaid expenses
  276,000 
  63,000 
      Accounts payable and accrued expenses
  219,000 
  784,000 
      Accrued interest
  696,000 
  638,000 
Net Cash Used in Operating Activities
  (3,684,000)
  (223,000)
 
    
    
CASH FLOWS FROM FINANCING ACTIVITIES:
    
    
Proceeds from issuance of common stock
  24,679,000 
  - 
Proceeds from exercise of warrants
  58,000 
  - 
Proceeds from issuance of notes payable
  1,205,000 
  200,000 
Net Cash Provided by Financing Activities
  25,942,000 
  200,000 
 
    
    
Net Increase (Decrease) in Cash
  22,258,000 
  (23,000)
Cash at Beginning of Period
  5,297,000 
  28,000 
Cash at End of Period
 $27,555,000 
 $5,000 
 
    
    
Cash paid during the year for:
    
    
  Interest
 $- 
 $- 
  Income taxes paid
 $- 
 $- 
 
    
    
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
    
    
    Common stock issued upon conversion of notes payable and accrued interest
 $38,806,000 
 $162,000 
     Extinguishment of unamortized debt discount and adjustment to accumulated deficit upon adoption of ASU 2020-06
 $4,519,000 
 $- 
    Convertible notes payable issued for accrued expenses
 $1,525,000 
 $- 
The accompanying notes are an integral part of these condensed consolidated financial statements.
 

 
GT BIOPHARMA, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share data)
 
 
Three Months Ended June 30,
 
 
Six Months Ended June 30,
 
 
 
2020
 
 
2019
 
 
2020
 
 
2019
 
Operating expenses:
 
 
 
 
 
 
 
 
 
 
 
 
Research and development
  12 
  154 
  336 
  988 
Selling, general and administrative expenses
  1,546  
  2,125  
  2,292  
  5,347  
Total operating expenses
  1,558  
  2,279  
  2,628  
  6,335  
Loss from operations
  (1,558)
  (2,279)
  (2,628)
  (6,335)
Other income (expense):
    
    
    
    
Loss on disposal of assets
  - 
  (31)
  - 
  (31)
Settlement expense
  (2,563)
  - 
  (2,563)
  - 
Interest expense
  (4,658)
  (479)
  (5,296)
  (933)
Total other income (expense)
  (7,221)
  (510)
  (7,859)
  (964)
Loss before provision for income taxes
  (8,779)
  (2,789)
  (10,487)
  (7,299)
Provision for income tax
  -  
  -  
  -  
  -  
Net loss
  (8,779)
  (2,789)
  (10,487)
  (7,299)
Net loss per common share – basic and diluted
 $(.12)
 $(.05)
 $(.15)
 $(0.14)
Weighted average common shares outstanding – basic and diluted
  71,899,937  
  51,918,252  
  70,978,579  
  51,507,849  
The accompanying notes are an integral part of these consolidated financial statements.

GT Biopharma, Inc. and Subsidiaries
Consolidated Statement of Stockholders’ Deficit
(In thousands)
 
 
Preferred Stock
 
 
Common Stock
 
 
Additional Paid-in
 
 
Accumulated
 
 
 
Shares
 
 
Amount
 
 
Shares
 
 
Amount
 
 
Capital
 
 
Deficit
 
Balance at January 1, 2020
  2,450 
 $25 
  69,785 
 $70 
 $548,096 
 $(567,332)
Issuance of common stock for convertible notes
    
    
  1,065 
  1 
  212 
    
Beneficial conversion feature of convertible notes
    
    
  3,500 
  3 
  26 
    
Issuance of common stock for settlement of litigation
    
    
  1,086 
  1 
  1,909 
    
Issuance of common stock for compensation
    
    
    
    
  146 
    
Net loss
    
    
    
    
    
  (10,487)
Balance at June 30, 2020
  2,450 
 $25 
  75,436 
 $75 
 $550,389 
 $(577,819)
 
 
Preferred Stock
 
 
Common Stock
 
 
Additional Paid-in
 
 
Accumulated
 
 
 
Shares
 
 
Amount
 
 
Shares
 
 
Amount
 
 
Capital
 
 
Deficit
 
Balance at January 1, 2019
  1,260 
 $13 
  50,650 
 $51 
 $540,160 
 $(528,685)
Issuance of preferred stock
  1,190 
  12 
    
    
  1,128 
    
Issuance of common stock for convertible notes
    
    
  1,994 
  2 
  1,040 
    
Beneficial conversion feature of convertible notes
    
    
    
    
  158 
    
Issuance of common stock for compensation
    
    
    
    
  2,565 
    
Net loss
    
    
    
    
    
  (7,299)
Balance at June 30, 2019
  2,450 
 $25 
  52,644 
 $53 
 $545,051 
 $(535,984)
The accompanying notes are an integral part of these consolidated financial statements.

GT Biopharma, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
For the Six Months Ended June 30, 2020 and 2019
(in Thousands)
 
 
2020
 
 
2019
 
 
 
(unaudited)
 
 
(unaudited)
 
CASH FLOWS FROM OPERATING ACTIVITIES:
 
 
 
 
 
 
Net loss
 $( 10,487)
 $( 7,299)
Adjustments to reconcile net loss to net cash used in operating activities:
    
    
Depreciation
  - 
  10 
Stock compensation expense for options and warrants issued to employees and non-employees
  147 
  3,705 
Amortization of debt discounts
  1 
  331 
Non-cash interest expense
  3,955 
  1,140 
Loss on disposal of assets
  - 
  31 
Settlement expense
  2,363 
  - 
Changes in operating assets and liabilities:
    
    
Other assets
  126 
  8 
Accounts payable and accrued liabilities
  261 
  26 
Net cash used in operating activities
  ( 3,634)
  ( 2,048)
CASH FLOWS FROM INVESTING ACTIVITIES:
    
    
Acquisition of fixed assets
  - 
  - 
Net cash used by investing activities
  0 
  0 
CASH FLOWS FROM FINANCING ACTIVITIES:
    
    
Proceeds from notes payable
  4,457 
  2,352 
Loan costs
  - 
  - 
Repayment of note payable
  - 
  (100)
Net cash provided by financing activities
  4,457 
  2,252 
Minority interest
  - 
  - 
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
  823 
  204 
CASH AND CASH EQUIVALENTS - Beginning of period
  28 
  60 
CASH AND CASH EQUIVALENTS - End of period
 $851 
 $264 
 
    
    
Supplemental disclosures:
    
    
Interest paid
 $69 
 $- 
Income taxes paid
 $- 
 $- 
 
    
    
Supplemental disclosures:
    
    
Issuance of common stock upon conversion of convertible notes
 $200 
 $1,035 
Issuance of common stock upon conversion of accrued interest
 $12 
 $10 
The accompanying notes are an integral part of these consolidated financial statements.

GT BIOPHARMA, INC. AND SUBSIDIARIES
CONDENSED NOTESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
JUNE 30,For the Three Months Ended March 31, 2021 and 2020
 
(UNAUDITED)
1.            
The CompanyNote 1 – Organization and Summary of Significant Accounting Policies
BusinessOperations
 
In 1965, the corporate predecessor of GT Biopharma Inc. (Company), Diagnostic Data, Inc. was incorporated in the State of California. Diagnostic Data changed its incorporation to the State of Delaware in 1972.1972 and changed its name to DDI Pharmaceuticals, Inc. in 1985. In 1994, DDI Pharmaceuticals merged with International BioClinical, Inc. and Bioxytech S.A. and changed its name to OXIS International, Inc. In July 2017, the Company changed its name to GT Biopharma, Inc.
 
The Company is a clinical stage biopharmaceutical company focused on the development and commercialization of novel immuno-oncology products based off our proprietary Tri-specific Killer Engager (TriKE™), Tetra-specific Killer Engager (TetraKE™) and bi-specific ligand-directed single-chain fusion protein technology(Dual Targeting TriKEDual Targeting TriKE) platforms. The Company’s TriKE and TetraKEDual Targeting TriKE platforms generate proprietary therapeutics designed to harness and enhance the cancer killing abilities of a patient’s own natural killer cells, or NK cells. Once bound
The accompanying condensed consolidated financial statements are unaudited. These unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to an NK cell,such rules and regulations. Accordingly, these interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s moieties are designed to enhanceAnnual Report on Form 10-K for the NK cell, and precisely direct it to one or more specifically-targeted proteins expressedfiscal year ended December 31, 2020 filed with the SEC on a specific typeApril 16, 2021 (the “2020 Annual Report”). The consolidated balance sheet as of cancer cell or virus infected cell, ultimately resulting inDecember 31, 2020 included herein was derived from the targeted cell’s death. TriKEs and TetraKEs are made upaudited consolidated financial statements as of recombinant fusion proteins, can be designed to target any number of tumor antigens on hematologic malignancies, sarcomas or solid tumors and do not require patient-specific customization.that date.
 
GoingIn the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to fairly present the Company’s financial position and results of operations for the interim periods reflected. Except as noted, all adjustments contained herein are of a normal recurring nature. Results of operations for the fiscal periods presented herein are not necessarily indicative of fiscal year-end results.
Note 2 –Going Concern
 
The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying consolidated financial statements, for the three months ended March 31, 2021, the Company incurred a net loss of $29.7 million and used cash in operating activities of $3.7 million. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that these financial statements are issued. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
During the three months ended March 31, 2021, the Company received net cash of $24.7 million from the sale of 4,945,000 shares of its common stock pursuant to a public offering. At March 31, 2021, the Company had cash on hand in the amount of $27.6 million. The Company’s current operations have focused on business planning, raising capital, establishing an intellectual property portfolio, hiring, and conducting preclinical studies and clinical trials. The Company does not have any product candidates approved for sale and has not generated any revenue from product sales. The Company has sustained operating losses since inception and expects such losses to continue over the foreseeable future.
The financial statements of the Company have been prepared on a going­concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Accordingly, the financial statements do not include any adjustments that might be necessary should the Company be unable to continue in existence.
The Company has incurred substantial losses and negative cash flows from operations since its inception and has an accumulated deficit of $578 million and cash of $851 thousand as of June 30, 2020. The Company anticipates incurring additional losses until such time, if ever, that it can generate significant sales of its products currently in development. Substantial additional financing will be needed by the Company to fund its operations and to commercially develop its product candidates. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
Management is currently evaluating different strategies to obtain the required funding for future operations. These strategies may include but are not limited to: public offerings of equity and/or debt securities, payments from potential strategic research and development, and licensing and/or marketing arrangements with pharmaceutical companies. If the Company is unable to secure adequate additional funding, its business, operating results, financial condition and cash flows may be materially and adversely affected.
Use of Estimates
Management estimates that the current funds on hand will be sufficient to continue operations through the next six months.The financial statements and notes are representations of the Company’s management, whichability to continue as a going concern is responsible for their integrity and objectivity. These accounting policies conformdependent upon its ability to accounting principles generally accepted in the United States of America, and have been consistently applied in the preparation of the financial statements. The preparation of financial statements requires managementcontinue to make estimates and assumptions that affect the reported amounts of assets, liabilities revenues and expenses and disclosures of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates.implement its business plan.
 

 
GT BIOPHARMA, INC. AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(UNAUDITED)
BasisNote 3 – Summary of Consolidation and Comprehensive Income
The accompanying consolidated financial statements include the accounts of GT Biopharma, Inc. and its subsidiaries. All intercompany balances and transactions have been eliminated. The Company’s financial statements are prepared using the accrual method of accounting.Significant Accounting Policies
 
Basis of Presentation and Principles of Consolidation
 
The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”)United States of America. The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Oxis Biotech, Inc. and Georgetown Translational Pharmaceuticals, Inc. Intercompany transactions and balances have been eliminated in consolidation.
In March 2011, the Company agreed to form a joint venture with engage:BDR, Inc., an on-line marketing company that offers both premium and placement-specific display marketing solutions and the rulesability to distribute campaigns through its own display platforms and regulationschannels. The first product to be marketed and sold through the Joint Venture was to be ErgoFlex™ product. In 2014 management of the U.S. SecuritiesCompany decided to end the sale of any ErgoFlex product. The entity has been discontinued since 2014.
Reverse Stock Split

On February 10, 2021, the Company completed a 1:17 reverse stock split of the Company's issued and Exchange Commission (“SEC”)outstanding shares of common stock and all fractional shares were rounded up. Certain informationAll share and disclosures required by U.S. GAAP for complete consolidatedper share amounts in the accompanying financial statements have been condensedadjusted retroactively to reflect the reverse stock split as if it had occurred at the beginning of the earliest period presented.
COVID-19
In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, has adversely affected workforces, customers, economies, and financial markets globally. It has also disrupted the normal operations of many businesses. This outbreak could decrease spending, adversely affect demand for the Company’s products, and harm the Company’s business and results of operations.
During the three months ended March 31, 2021, the Company believes the COVID-19 pandemic did impact its operating results. However, the Company has not observed any impairments of its assets or omitted herein. The interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto includeda significant change in the Company’s Form 10-Kfair value of its assets due to the COVID-19 pandemic. At this time, it is not possible for the year ended December 31, 2019 filed withCompany to predict the SEC on March 27, 2020. The unaudited interim condensed consolidated financial information presented herein reflects all normal adjustments that are, in the opinion of management, necessary for a fair statementduration or magnitude of the financial position,adverse results of the outbreak and its effects on the Company’s business or results of operations, and cash flows for the periods presented. The Company is responsible for the unaudited interim consolidated financial statements included in this report. The results of operations of any interim period are not necessarily indicative of the results for the full year.
Cash and Cash Equivalentscondition, or liquidity.
 
The Company considers all highly liquid investments with original maturitieshas been following the recommendations of three months or lesshealth authorities to be cash equivalents.minimize exposure risk for its team members, including the temporary closure of its corporate office and having team members work remotely. Most vendors have transitioned to electronic submission of invoices and payments.
 
Concentrations of Credit RiskAccounting Estimates
 
The Company’s cash and cash equivalents, marketable securities and accounts receivable are monitored for exposure to concentrations of credit risk. The Company maintains substantially all of its cash balances in a limited numberpreparation of financial institutions. The balances are each insured bystatements in conformity with Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the Federal Deposit Insurance Corporation up to $250,000. The Company had a balancereported amounts of approximately $600,000assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include accruals for potential liabilities, valuation of notes payable, assumptions used in excessderiving the fair value of this limit at June 30, 2020.derivative liabilities, valuation of equity instruments issued for services and realization of deferred tax assets. Actual results could differ from those estimates.
 
Stock BasedStock-Based Compensation to Employees
 
The Company accounts for its stock-based compensation forshare-based awards to employees and nonemployees and consultants in accordance with Accounting Standards Codification (“ASC”) 718.  The Company recognizes in the statementprovisions of operations the grant-dateASC 718, Compensation-Stock Compensation. Stock-based compensation cost is measured at fair value of stock optionson the grant date and other equity-based compensation issued to employees and non-employeesthat fair value is recognized as expense over the relatedrequisite service, or vesting, period.
The Company granted no stock options during the six months ended June 30, 2020 and 2019, respectively.
 

 
GT BIOPHARMA, INC. AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020Fair Value of Financial Instruments
 
(UNAUDITED)

Long-Lived AssetsFASB Accounting Standards Codification ("ASC") 820-10 requires entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet for which it is practicable to estimate fair value. ASC 820-10 defines the fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties.
 
Our long-lived assets include property, plant and equipment, capitalized costsThe three levels of filing patent applications and other indefinite lived intangible assets. We evaluate our long-lived assets for impairment, other than indefinite lived intangible assets, in accordance with ASC 360, whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Estimates of future cash flows and timing of events for evaluating long-lived assets for impairmentfair value hierarchy are based upon management’s judgment. If any of our intangible or long-lived assets are considered to be impaired, the amount of impairment to be recognized is the excessas follows:
Level 1
Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.
Level 2
Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.
Level 3Valuations based on inputs that are unobservable, supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
The carrying amount of the assets over its fair value.Company’s derivative liability of $362,000 at March 31, 2021 and $383,000 at December 31, 2020 was based on Level 2 measurements.
 
Applicable long-livedThe carrying amounts of the Company’s other financial assets are amortized or depreciated overand liabilities, such as cash, prepaid expense, accounts payable and accrued expenses approximate their fair values because of the shortershort maturity of their estimated useful lives, the estimated period that the assets will generate revenue, or the statutory or contractual term in the case of patents. Estimates of useful lives and periods of expected revenue generation are reviewed periodically for appropriateness and are based upon management’s judgment.these instruments.
 
Impairment of Long-Lived AssetsDerivative Financial Instruments
 
The Company evaluates indefinite lived intangible assetsits financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for impairmentas liabilities, the derivative instrument is initially recorded at least annuallyits fair value and whenever impairment indicators are presentis then re-valued at each reporting date, with changes in accordance with ASC 350. When necessary, the Company records an impairment loss for the amount by which the fair value reported in the consolidated statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is less thanevaluated at the carrying valueend of these assets.each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date. The fair value of intangible assets other than goodwill is typicallythe embedded derivatives are determined using the “relief from royalty method”, specifically the discounted cash flowa Binomial valuation method utilizing Level 3 fair value inputs. Some of the more significant estimatesat inception and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which includes the expected impact of competitive, legal and/or regulatory forces on the projections and the impact of technological risk associated with IPR&D assets, as well as the selection of a long-term growth rate; the discount rate, which seeks to reflect the various risks inherent in the projected cash flows; and the tax rate, which seeks to incorporate the geographic diversity of the projected cash flows.
The Company performs impairment testing for all other long-lived assets whenever impairment indicators are present. When necessary, the Company calculates the undiscounted value of the projected cash flows associated with the asset, or asset group, and compares this estimated amount to the carrying amount. If the carrying amount is found to be greater, we record an impairment loss for the excess of book value over fair value.
Income Taxes
The Company accounts for income taxes using the asset and liability approach, whereby deferred income tax assets and liabilities are recognized for the estimated future tax effects, based on current enacted tax laws, of temporary differences between financial and tax reporting for current and prior periods. Deferred tax assets are reduced, if necessary, by asubsequent valuation allowance if the corresponding future tax benefits may not be realized.dates.
 
Net Income (Loss) perLoss Per Share
 
Basic net incomeearnings (loss) per share is computed by dividingusing the net income (loss) for the period by the weighted averageweighted-average number of common shares outstanding during the period. Common stock issuable is included in our calculation as of the date of the underlying agreement. Diluted net incomeearnings (loss) per share is computed by dividingusing the net income (loss) for the period by the weighted averageweighted-average number of common shares and the dilutive effect of contingent shares outstanding during the period, plus the potentialperiod. Potentially dilutive effectcontingent shares, which primarily consist of common shares issuable upon exercise or conversion of outstanding, convertible notes, and debentures (including sharesstock issuable upon conversionto the exercise of accrued interest or other default amounts with respect to such convertible notes or debentures), stock options and warrants during the period. The weighted average number of potentially dilutive common shareshave been excluded from the calculation of net income (loss)diluted loss per share totaled in 127,946,216 and 39,416,352 as of June 30, 2020 and 2019, respectively.calculation because their effect is anti-dilutive.
 
PatentsThese following common stock equivalents were excluded in the computation of the net loss per share because their effect is anti-dilutive.
 
Acquired patents
 
 
March 31,
2021
 
 
March 31,
2020
 
 
 
 
 
 
 
 
A. Options to purchase common stock
  - 
  3 
B. Warrants to purchase common stock
  5,318,867 
  106,650 
C. Convertible notes payable
  - 
  4,678,823 
D. Convertible Series J Preferred stock
  - 
  692,220 
E. Convertible Series C Preferred stock
  7 
  7 
 
  5,318,874 
  5,477,703 

Segments
The Company determined its reporting units in accordance with ASC 280, “Segment Reporting” (“ASC 280”). Management evaluates a reporting unit by first identifying its’ operating segments under ASC 280. The Company then evaluates each operating segment to determine if it includes one or more components that constitute a business. If there are capitalized at their acquisition cost or fair value. The legal costs, patent registration fees and models and drawings required for filing patent applications are capitalizedcomponents within an operating segment that meet the definition of a business, the Company evaluates those components to determine if they relatemust be aggregated into one or more reporting units. If applicable, when determining if it is appropriate to commercially viable technologies. Commercially viable technologiesaggregate different operating segments, the Company determines if the segments are those technologieseconomically similar and, if so, the operating segments are aggregated.

Management has determined that the Company has one consolidated operating segment. The Company’s reporting segment reflects the manner in which its chief operating decision maker reviews results and allocates resources. The Company’s reporting segment meets the definition of an operating segment and does not include the aggregation of multiple operating segments.
Recent Accounting Pronouncements
In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. Under ASU 2020-06, the embedded conversion features are projected to generate future positive cash flows inno longer separated from the near term. Legal costs associatedhost contract for convertible instruments with patent applicationsconversion features that are not determinedrequired to be commercially viable are expensedaccounted for as incurred. All researchderivatives under Topic 815, or that do not result in substantial premiums accounted for as paid-in capital. Consequently, a convertible debt instrument will be accounted for as a single liability measured at its amortized cost, as long as no other features require bifurcation and development costs incurred in developingrecognition as derivatives. The new guidance also requires the patentable idea are expensed as incurred. Legal fees from the costs incurred in successful defenseif-converted method to the extent of an evident increase in the valuebe applied for all convertible instruments. ASU 2020-06 is effective for fiscal years beginning after December 15, 2021, with early adoption permitted. Adoption of the patentsstandard requires using either a modified retrospective or a full retrospective approach. Effective January 1, 2021, we early adopted ASU 2020-06 using the modified retrospective approach. Adoption of the new standard resulted in a decrease to additional paid-in capital of $4,519,000 (see Note 4).
Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission (the “SEC”) did not or are capitalized.not believed by management to have a material impact on the Company’s present or future consolidated financial statements.
Note 4 – Convertible Notes Payable
Convertible notes payable consisted of the following:
March 31,
2021
December 31,
2020
A. Notes payable issued for cash
$-
$24,085,000
B. Notes payable issued for settlement agreements
-
2,528,000
C. Notes payable issued for forbearance agreements
-
3,849,000
D. Notes payable issued for consulting services
-
360,000
-
30,822,000
Less unamortized debt discount
-
(4,519,000)
    Convertible notes, net of discount
$-
$26,303,000
 

 
GT BIOPHARMA, INC. AND SUBSIDIARIES
A. 
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(UNAUDITED)
Capitalized costNotes Payable Issued for pending patents are amortized on a straight-line basis over the remaining twenty year legal life of each patent after the costs have been incurred. Once each patent is issued, capitalized costs are amortized on a straight-line basis over the shorter of the patent’s remaining statutory life, estimated economic life or ten years.
Fixed Assets
Fixed assets are stated at cost. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets, which are 3 to 10 years for machinery and equipment and the shorter of the lease term or estimated economic life for leasehold improvements.
Fair Value
The carrying amounts reported in the balance sheets for receivables and current liabilities each qualify as financial instruments and are a reasonable estimate of fair value because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest.  The three levels are defined as follows:
● 
Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. The Company’s Level 1 assets include cash equivalents, primarily institutional money market funds, whose carrying value represents fair value because of their short-term maturities of the investments held by these funds.Cash
 
● 
Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. There were not such liabilities at June 30, 2020.
● 
Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement. There were no such assets or liabilities as of June 30, 2020.
Research and Development
Research and development costs are expensed as incurred and reported as research and development expense. Research and development costs totaled $0.3 million and $1 million for the six months ended June 30, 2020 and 2019, respectively.
Revenue Recognition
License Revenue
License arrangements may consist of non-refundable upfront license fees, exclusive licensed rights to patented or patent pending technology, and various performance or sales milestones and future product royalty payments. Some of these arrangements are multiple element arrangements.
Non-refundable, up-front fees that are not contingent on any future performance by us, and require no consequential continuing involvement on our part, are recognized as revenue when the license term commences and the licensed data, technology and/or compound is delivered.  We defer recognition of non-refundable upfront fees if we have continuing performance obligations without which the technology, right, product or service conveyed in conjunction with the non-refundable fee has no utility to the licensee that is separate and independent of our performance under the other elements of the arrangement. In addition, if we have continuing involvement through research and development services that are required because our know-how and expertise related to the technology is proprietary to us, or can only be performed by us, then such up-front fees are deferred and recognized over the period of continuing involvement.

GT BIOPHARMA, INC. AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(UNAUDITED)

Payments related to substantive, performance-based milestones in a research and development arrangement are recognized as revenue upon the achievement of the milestones as specified in the underlying agreements when they represent the culmination of the earnings process. As of June 30, 2020, the Company has not generated any licensing revenue.
2.            
Debt
Convertible Notes/Debentures
As of June 30, 2020, the Company had approximately $21.8 million aggregate principal amount of convertible notes and debentures (collectively, the “Convertible Notes”) outstanding that were issued pursuant to securities purchase agreements (or, in the case of the Settlement Notes (as defined herein), the Settlement Agreement (as defined herein)) entered into with numerous investors. The Company issued an additional approximately $3.2 million aggregate principal amount of Convertible Notes on July 7, 2020. See Note 6, Subsequent Events under the caption “Convertible Notes.”
The Convertible Notes are convertible at any time, at the holder’s option, into sharespart of the Company’s common stock at an initial conversion price, subject to certain beneficial ownership limitations (which vary between maximum ownership of between 4.99% and 9.99%). The conversion price of the Convertible Notes is also generally subject to adjustment due to certain events, including stock dividends, stock splits and in connection with the issuance byfinancing activities, the Company of common stock or common stock equivalents at an effective price per share lower than the conversion price thenissued convertible notes payable in effect. The conversion priceexchange for each of the Company’s outstanding Convertible Notes is currently $0.20 per share. In addition, approximately $5.2 million aggregate principal amount of the Company’s Convertible Notes will be subject to mandatory conversion in connection with the completion of a future financing in the amount of at least $15 million, subject to the beneficial ownership limitations described above.
The Convertible Notes generally have terms of six months to one year and mature between August 2, 2019 and January 7, 2021, unless earlier converted or repurchased. The Convertible Notes each accruecash. These notes payable were unsecured, bear interest at a rate of 10% per annum, mature in six months up to one year from the date of issuance, and are convertible to common stock at an average conversion rate of $3.40 per share,subject to increasecertain beneficial ownership limitations (with a maximum ownership limit of 4.99%) and standard anti-dilution provisions.As of December 31, 2020, the outstanding balance of these notes amounted to 18% per annum upon and during the occurrence of an event of default with respect to certain of the Convertible Notes. Interest is payable in cash or, with respect to certain of the Convertible Notes, and at the holder’s option, in shares of common stock based on the conversion price then in effect.$24,085,000.
 
Pursuant toIn January 2021, the termsCompany issued similar notes payable in exchange for cash of $1,205,000.On February 16, 2021 in accordance with the note agreements upon completion of the equity offering discussed in Note 7, these notes were mandatorily converted at a conversion rate of $3.40 per share into 7,438,235 shares of the Company’s common stock.
B. 
Notes Payable Issued for Settlement Notes,Agreements
In fiscal 2019 and 2020, the Company is requiredissued its convertible notes payable to make an offerresolve claims and disputes pertaining to repurchase,certain debt and equity instruments issued by the Company in prior years. The notes were unsecured, bear interest at the holder’s option, the Settlement Notes at pricea rate of 10%, mature in cash equalsix months up to 100% of the aggregate principal amount of the Settlement Note plus accrued and unpaid interest, if any, to, but excluding,one year from the date of repurchase following the consummation by the Companyissuance, and are convertible to common stock at a conversion rate of $3.40 per share, as adjusted,subject to certain beneficial ownership limitations (with a financing transaction, or a seriesmaximum ownership limit of transactions, resulting in aggregate gross proceeds to the Company in excess of $7.5 million. Generally, the Company otherwise does not have the right to prepay any of the Convertible Notes without the prior written consent of the holders of such securities.
The Convertible Notes contain a number of affirmative4.99%) and negative covenants and customary events of default. standard anti-dilution provisions.As of June 30,December 31, 2020, approximately $13.2 aggregate principal amountoutstanding balance of our Convertible Notes were in default. See “Forbearance Agreementsthese notes payable for settlement agreements amounted to $2,528,000.” below.
 
The securities purchaseOn February 16, 2021 in accordance with the note agreements and Settlement Agreement, as applicable, also generally contain certain ongoing covenantsupon completion of the Company, including rightsequity offering discussed in Note 7, these notes were mandatorily converted at a conversion rate of participation in certain future financing transactions, limitations on future variable rate transactions and “at-the-market” offerings and “most favored nation” provisions giving holders of certain$3.40 per share into 743,529 shares of the Convertible Notes the benefit of any terms or conditions under which the Company agrees to issue or sell anyCompany’s common stock or common stock equivalents that are more favorable to an investor than the terms and conditions granted to such holder under the applicable securities purchase agreement and the transactions contemplated thereby.

stock.
 
GT BIOPHARMA, INC. AND SUBSIDIARIES
C. 
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTSNotes Payable Issued for Forbearance Agreements
JUNE 30, 2020
 
(UNAUDITED)

The Convertible Notes are senior obligations of the Company. In addition, approximately $8.9 million aggregate principal amount of the Convertible Notes are secured by a first priority security interest in substantially all of the assets of the Company and its subsidiaries. Convertible Notes are also secured by individual pledges by certain of our current and former officers and directors of our common stock owned by such officer and directors.
For additional information about the Convertible Notes, see Note 4, Debt to the Company’s audited consolidated financial statements included in the Company’s Form 10-K for the year ended December 31, 2019.
Forbearance Agreements
Effective as ofOn June 23, 2020, the Company entered into Standstill and Forbearance Agreements (collectively, the “Forbearance Agreements”) with the holders of $13.2 million aggregate principal amount of the Convertible Notes (the “Default Notes”), which are currentlywere in default. Pursuant to the Forbearance Agreements, the holders of the Default Notes have agreed to forbear from exercising their rights and remedies under the Default Notes (including declaring such Default Notes (together with any default amounts and accrued and unpaid interest) immediately due and payable) until the earlier of (i) the date that the Company completes a future financing in the amount of $15 million and, in connection therewith, commences listing on NASDAQ (collectively, the “New Financing”) or (ii) October 1, 2020January 31, 2021 (the “Termination Date”). As a resultof December 31, 2020, outstanding balance of the ongoing default,notes payable amounted to $3,849,000.
On February 16, 2021 in accordance with the Default note agreements upon completion of the equity offering discussed in Note 7, these notes were mandatorily converted at a conversion rate of $3.40 per share into 1,132,059 shares of the Company’s common stock.
D. 
Notes Payable issued for Consulting Agreements
In prior years, the Company issued its convertible notes payable in exchange for consulting services.These notes payable are currently accruingunsecured, bear interest at the defaulta rate of 18%10% per annum, and have accrued additional default amounts of approximately $3.9 millionmature in the aggregate as of June 30, 2020.
The obligations of the holderssix months up to forbearone year from exercising their rights and remedies under the Default Notes pursuant to the Forbearance Agreements will terminate on the earliest of (i) the Termination Date, (ii) the date of any bankruptcy filing by the Company or its subsidiaries, (iii) the date on which the Company defaults on any of the termsissuance, and conditions of the Forbearance Agreements or (iv) the date the Forbearance Agreements are otherwise terminated or expire.
The Forbearance Agreements contain various customary and other representations, warranties and covenants of the Company and the holders of the Default Notes, including an agreement that the Default Notes (together with default amounts and accrued and unpaid interest) will be converted into common stock upon the closing of a New Financing at a conversion price equal to the lesser of (i) the conversion price in effect for the Default Notes on the date of such New Financing or (ii) 75% of the lowest per share price at which common stock is or may be issued in connection with such New Financing, in each case, subject to certain beneficial ownership limitations (with a maximum ownership limit of 9.99%). Shares of the Company’s preferred stock, which are convertible into the Company’s common stock, will be issued in lieu of common stock to the extent that conversion of the Default Notes is prohibited by such beneficial ownership limitations.
Settlement Notes
On June 19, 2020, the Company entered into a settlement agreement (the “Settlement Agreement”) with Empery Asset Master Ltd., Empery Tax Efficient, LP and Empery Tax Efficient II, LP (collectively, the “Empery Funds”), Anthony Cataldo and Paul Kessler resolving all remaining disputes between the parties pertaining to certain Convertible Notes and warrants to purchase common stock of the Company (collectively, the “Original Securities”) issued by the Company to the Empery Funds in January 2018 pursuant to a securities purchase agreement. In connection with the Settlement Agreement, the Company issued Convertible Notes in an aggregate principal amount of $450,000 (the “Settlement Notes”) to the Empery Funds on June 19, 2020. The Settlement Notes are convertible at any time, at the holder’s option, into shares of our common stock at an initialaverage conversion pricerate of $0.20$3.40 per share,, subject to certain beneficial ownership limitations (with a maximum ownership limit of 4.99%) and standard anti-dilution provisions. As of December 31, 2020, outstanding balance of these notes payable amounted to $360,000
 

 
GT BIOPHARMA, INC. AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(UNAUDITED)
The Settlement Notes mature on December 19, 2020, unless earlier converted or repurchased. The terms of the Settlement Notes are generally the same as the Company’s other Convertible Notes, except thatIn January 2021, the Company is required to make an offer to repurchase, at the optionissued similar notes payable of each holder, the Settlement Notes at price$720,000 in cash equal to 100% of the aggregate principal amount of the Settlement Notes plus accrued and unpaid interest, if any, to, but excluding, the date of repurchase following the consummation byexchange for consulting services. In addition, the Company also issued a note payable of a financing transaction, or a series$525,000 in exchange for the cancellation of transactions, resulting in aggregate gross proceeds to the Company in excessan unpaid consulting fees that was recorded as part of $7.5 million.
Fiscal 2019 and Fiscal 2020 Convertible Notes Transactionsaccrued expenses as of December 31, 2020.
 
On February 4, 2019,16, 2021 in accordance with the Company entered into a securities purchase agreement with certain purchasers pursuant to which it issued secured Convertible Notesnote agreements upon completion of the equity offering discussed in anNote 7, these notes in the aggregate principal amount of $1,352,224, consisting$1,605,000 were mandatorily converted at a conversion rate of gross proceeds$3.40 per share into 472,059 shares of $1,052,224 and settlement of existing debt of $300,000, which Convertible Notes were convertible into common stock at an initial conversion price of $0.60 per share.
On May 22, 2019, the Company entered into a securities purchase agreement with certain purchasers pursuant to which the Company issued Convertible Notes in an aggregate principal amount of $1,300,000, which Convertible Notes were convertible into the Company’s common stock at an initial conversion price of $0.35 per share.stock.
 
Between JulyAs of December 31, and August 28, 2019, the Company entered into a securities purchase agreement with certain purchasers pursuant to which the Company issued Convertible Notes in an aggregate principal amount of $975,000, which Convertible Notes are convertible into the Company’s common stock at an initial conversion price of $0.20 per share.
On December 19, 2019, the Company entered into a securities purchase agreement with one purchaser pursuant to which the Company issued Convertible Notes in an aggregate principal amount of $200,000, which Convertible Notes are convertible into the Company’s common stock at an initial conversion price of $0.20 per share.
On January 30, 2020, the Company entered into a securities purchase agreement with one purchaser pursuantaccrued interest of $4,838,000 related to whichthese convertible notes payable. During the period ended March 31, 2021, the Company issued Convertible Notes in an aggregate principal amountaccrued interest of $200,000, which Convertible Notes are convertible into$696,000. As a result of the mandatory conversion of the Company’s notes payable, on February 16, 2021, total accrued interest amounted to $5,534,000 were converted to 1,627,647 shares of common stock at an initial conversion price of $0.20 per share.stock.
 
Between April 20As a result, total notes payable of $33,272,000 and May 7,accrued interest of $5,534,000 for a total of $38,806,000 were mandatorily converted to 11,413,322 shares of common stock.
Adoption of ASU 2020-06
At December 31, 2020,, the Company entered intohad recorded a securities purchase agreement with certain purchasers pursuantnote discount of $4,519,000 to whichaccount for beneficial conversion feature that existed on the Company issued Convertible Notes in an aggregate principal amountdate of $2,017,000, which Convertible Notes are convertible intoissuance for the Company’s common stock at an initial conversion price of $0.20 per share.above notes.
 
On June 19, 2020,January 1, 2021 the Company entered intochose to adopt Accounting Standards Update (“ASU”) 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. Under ASU 2020-06, the Settlement Agreementembedded conversion features are no longer required to be separated from the host contract for convertible instruments with conversion features that are not required to be accounted for as derivatives under Topic 815, or that do not result in substantial premiums accounted for as paid-in capital. The Company accounted for the adoption of this standard by charging opening additional paid in capital at January 1, 2021. In addition, pursuant to whichASU 2020-06, the Company issuedalso adjusted accumulated deficit and additional paid in capital by $226,000 to account the Settlement Notesderecognition of the $226,000 interest expense recorded in an aggregate principal amount of $450,000, which Settlement Notes are convertible into the Company’s common stock at an initial conversion price of $0.20 per share.fiscal 2020.
 
On July 7, 2020, the Company entered into a securities purchase agreement with certain purchasers pursuant to which the Company issued Convertible Notes in an aggregate principal amount of $3,190,000, which Convertible Notes are convertible into the Company’s common stock at an initial conversion price of $0.20 per share.
 
Gemini Financing AgreementNote 5 – Line of Credit
 
On November 8, 2010, the Company entered into a financing arrangement with Gemini Pharmaceuticals, Inc., a product development and manufacturing partner of the Company, pursuant to which Gemini Pharmaceuticals made a $250,000 strategic equity investment in the Company and agreed to make a $750,000 purchase order line of credit facility available to the Company. The outstanding principal of all advances under the line of credit will bear interest at the rate of interest of prime plus 2% per annum. There is $31,000 due on
As of March 31, 2021 and December 31, 2020, outstanding balance of this credit line amounted to $31,000, respectively.
Note 6 – Derivative Liability
During the year ended December 31, 2020, the Company issued certain warrants that contained a fundamental transaction provision that could give rise to an obligation to pay cash to the warrant holder upon occurrence of certain change in control type events.
In accordance with ASC 480, the fair value of these warrants are classified as a liability in the Consolidated Balance Sheet and will be re-measured at June 30, 2020.the end of every reporting period with the change in value reported in the statement of operations.
The derivative liabilities were valued using a Binomial pricing model with the following average assumptions:
 
 
March 31,
2021
 
 
December 31,
2020
 
 
 
 
 
 
 
 
Stock Price
 $6.84 
 $7.21 
Risk-free interest rate
  0.92%
  0.36%
Expected volatility
  136%
  135%
Expected life (in years)
 
4.4 years
 
 
4.6 years
 
Expected dividend yield
  - 
  - 
 
    
    
Fair Value:
    
    
Warrants
 $362,000 
 $383,000 
The risk-free interest rate was based on rates established by the Federal Reserve Bank. The Company uses the historical volatility of its common stock to estimate the future volatility for its common stock. The expected life of the derivative securities was determined by the remaining contractual life of the derivative instrument. For derivative instruments that already matured, the Company used the estimated life. The expected dividend yield was based on the fact that the Company has not paid dividends to its common stockholders in the past and does not expect to pay dividends to its common stockholders in the future.
During the three months ended March 31, 2021, the Company recognized a gain of $21,000 to account the change in fair value of the derivative liability in accordance with ASC 842.
Note 7 – Stockholders’ Equity (Deficit)
Common Stock Issuable
As a result, of the mandatory conversion of the notes payable and accrued interest in the aggregate of $38,806,000 on February 16, 2021, the Company is obligated to issue a total of 11,413,322 shares of common stock to the respective noteholders.
As of March 31, 2021, the Company was only able to issue 3,779,322 shares of common stock or approximately 33% or $12,850,000 of the converted notes payable and accrued interest to the respective noteholders. With regards to the remaining 7,634,000 unissued shares of common stock, the Company is in the process of obtaining the necessary supporting documentation from the respective noteholders which will then be provided to the Company’s stock transfer agent as a requirement for the issuance of the common stock certificate.
For financial reporting purposes, the Company reported $25,956,000 as common stock issuable in the accompanying statements of stockholders equity to account for the estimated balance of the converted notes payable and accrued interest that the Company has not yet issued the corresponding common stock.
Subsequent to March 31, 2021, the Company issued a total of 5,336,191 shares of common stock to these noteholders upon submission of the required documentation to the Company’s stock transfer agent.
  

GT BIOPHARMA, INC. AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020The following were transactions during the three months ended March 31, 2021:
 
(UNAUDITED)
Issuance of Common Stock in public offering
 
3.            
Stockholders’ Equity
Common Stock
Our authorized capital stock consistsOn February 16, 2021, the Company completed a public offering of 750,000,0004,945,000 shares of common stock par value $0.001for net proceeds of $24,679,000, after deducting underwriting discounts, commissions and other direct offering expenses. As part of the offering, the Company also granted these investors, warrants to purchase 5,192,250 shares of common stock. The warrants are fully vested, exercisable at $5.50 per share and 15,000,000 shareswill expire in five years.
As a result of preferred stock, par value $0.01 per share. Asthe completion of June 30, 2020, 75,435,862the public offering and the successful listing of its shares of common stock wereon the Nasdaq Capital Markets, convertible notes with an aggregate principal amount of $33,272,000 and accrued interest of $5,534,000 mandatorily converted at its stated conversion rate of $3.40 per share into 11,413,322 shares of the Company’s common stock (see Note 4).
Issuance of Common Stock for services - consultants
As part of consulting agreements with certain consultants, the Company agreed to grant these consultants common stock equal to 1% and 3% of the fully diluted shares of common stock of the Company upon conversion of options, warrants and Convertible Notes in association with a national markets qualified financing as consideration for entering into the Agreement (with such stock to vest and be delivered within 30 days after the national markets qualified financing). Pursuant to the agreement, approximately 75% of the common stock to be issued will vest immediately while the remaining 25% will vest over a period of two years.
On February 16, 2021, the Company completed its equity offering and outstanding.listed its shares of common stock on the Nasdaq Capital Markets (see Note 7). As a result, the Company issued to these consultants 2,502,518 shares of common stock with a fair value of $9,679,000. Pursuant to current accounting guidelines, as the grant of the common stock is subject to milestone or performance condition, the Company measured the fair value of the common stock on the respective date of the agreement, and then such award was recorded as compensation expense as the milestone or performance condition was met and in accordance with its vesting term of the grant.
 
During the six monthsperiod ended June 30, 2020,March 31, 2021, pursuant to the vesting terms of the agreements, the Company issued 1,064,7341,807,374 shares of common stock to these consultants and recorded the corresponding stock compensation expense of $7,239,000. In addition, the Company also issued 150,000 shares of common stock with a fair value of $1,213,000 to other consultants for service rendered.
As of March 31, 2021, the fair value of 695,144 unvested shares to be recognized as compensation in future periods amounted to $2,440,000.
Issuance of Common Stock for research and development agreement
During the three months ended March 31, 2021, the Company issued 189,753 shares of common stock for a research and development agreement valued at $1,355,000. The common shares were valued on the market price at the date of grant.
Issuance of Common Stock upon exercise of warrants
During the three months ended March 31, 2021, the Company issued 94,824 shares of common stock upon conversionthe exercise of $212,947warrants resulting in principal and interest on Convertible Notes.cash proceeds of $58,000.
 
On May 1, 2020,Common Stock Issuable
As a result of the mandatory conversion of the notes payable and accrued interest in the aggregate of $38,806,000 on February 16, 2021, the Company issued 1,086,429is obligated to issue a total of 11,413,322 shares of common stock for consulting services.to the respective noteholders.
 
On June 19, 2020,As of March 31, 2021, the Company issued 3,500,000was only able to issue 3,779,322 shares of common stock pursuantor approximately 33% or $12,850,000 of the converted notes payable and accrued interest to the Settlement Agreement.respective noteholders. With regards to the remaining 7,634,000 unissued shares of common stock, the Company is in the process of obtaining the necessary supporting documentation from the respective noteholders which will then be provided to the Company’s stock transfer agent as a requirement for the issuance of the common stock certificate.
 
For financial reporting purposes, the Company reported $25,956,000 as common stock issuable in the accompanying statements of stockholders equity to account for the estimated balance of the converted notes payable and accrued interest that the Company has not yet issued the corresponding common stock.
Subsequent to March 31, 2021, the Company issued a total of 5,336,191 shares of common stock to these noteholders upon submission of the required documentation to the Company’s stock transfer agent.

Preferred Stock
A. 
Series J Preferred Stock
 
 On September 1, 2017, the Board designated 2,000,000 shares of Series J preferred stock (the “Series J Preferred Stock”). On the same day, the Board issued 1,513,548 shares of Series J Preferred Stock in exchange for the cancellation of certain indebtedness. 
In the first quarter of 2019, it was discovered that a certificate of designation with respect to the Series J Preferred Stock had never been filed with the Office of the Secretary of State for the State of Delaware.  Despite the fact the Company had issued shares of Series J Preferred Stock, the issuance of those shares was not valid and was of no legal effect.

To remedy the situation, on April 4, 2019, the Company filed a certificate of designation with the Office of the Secretary State for the State of Delaware designating a series of preferred stock as the Series J-1 preferred stock, par value $0.01 per share (the “Series J-1 Preferred Stock”).  On April 19, 2019, the Company issued 840,000 shares of Series J-1 Preferred Stock.  The issuance was in lieu of the Series J Preferred Stock that should have been issued on September 1, 2017, and in settlement for not receiving preferred stock until 20 months after the debt for which the stock was issued was cancelled.
Shares of the Series J-1 Preferred Stock are convertible at any time, at the option of the holders, into shares of the Company’s common stock at an effective conversion price of $3.40 per share, subject to adjustment for, among other things, stock dividends, stock splits, combinations, reclassifications of our capital stock and mergers or consolidations, and subject to a beneficial ownership limitation which prohibits conversion if such conversion would result in the holder (together with its affiliates) being the beneficial owner of in excess of 9.99% of the Company’s common stock or 692,220 shares of common stock. Shares of the Series J-1 Preferred Stock have the same voting rights a shares of the Company’s common stock, with the holders of the Series J-1 Preferred Stock entitled to vote on an as-converted-to-common stock basis, subject to the beneficial ownership limitation described above, together with the holders of the Company’s common stock on all matters presented to the Company’s stockholders. The Series J-1 Preferred Stock are not entitled to any dividends (unless specifically declared by the Board), but will participate on an as-converted-to-common-stock basis in any dividends to the holders of the Company’s common stock. In the event of the Company’s dissolution, liquidation or winding up, the holders of the Series J-1 Preferred Stock will be on parity with the holders of the Company’s common stock and will participate, on a on an as-converted-to-common stock basis, in any distribution to holders of the Company’s common stock..
On February 16, 2021, as a result of the completion of the public offering and the successful listing of its shares of common stock on the Nasdaq Capital Markets, 2,353,548 shares of Series J Preferred stock mandatorily converted at a conversion rate of $3.40 per share into 692,220 shares of the Company’s common stock.
B. 
Series C Preferred Stock
The 96,230 shares of Series C preferred stock, par value $0.01 per share (the “Series C Preferred Stock”), are convertible into 1117 shares of the Company’s common stock at the option of the holders at any time. The conversion ratio is based on the average closing bid price of the common stock for the fifteen consecutive trading days ending on the date immediately preceding the date notice of conversion is given, but cannot be less than 0.20 $3.40 or more than 0.2889 $4.9113 common shares for each share of Series C Preferred Stock. The conversion ratio may be adjusted under certain circumstances such as stock splits or stock dividends. The Company has the right to automatically convert the Series C Preferred Stock into common stock if the Company lists its shares of common stock on the Nasdaq National Market and the average closing bid price of the Company’s common stock on the Nasdaq National Market for 15 consecutive trading days exceeds $3,000.00. Each share of Series C Preferred Stock is entitled to the number of votes equal to 0.26 divided by the average closing bid price of the Company’s common stock during the fifteen consecutive trading days immediately prior to the date such shares of Series C Preferred Stock were purchased. In the event of liquidation, the holders of the Series C Preferred Stock shall participate on an equal basis with the holders of the common stock (as if the Series C Preferred Stock had converted into common stock) in any distribution of any of the assets or surplus funds of the Company. The holders of Series C Preferred Stock are entitled to noncumulative dividends if and when declared by the Company’s board of directors (the “Board”). No dividends to holders of the Series C Preferred Stock were issued or unpaid through June 30, 2020.March 31, 2021.
C. 
Series K Preferred Stock
 
On September 1, 2017,February 16, 2021, the CompanyBoard designated 2,000,000115,000 shares of Series J preferred stock (the “Series J Preferred Stock”). On the same day, the Board issued 1,513,548 shares of Series J Preferred Stock in exchange for the cancellation of certain indebtedness.  In the first quarter of 2019, it was discovered that a certificate of designation with respect to the Series J Preferred Stock had never been filed with the Office of the Secretary of State for the State of Delaware.  Legal research determined that despite the fact the Company had issued shares of Series J Preferred Stock, those shares had, in fact, never existed.
To remedy the situation, on April 4, 2019, the Company filed a certificate of designation with the Office of the Secretary State for the State of Delaware designating a series of preferred stock as the Series J-1K preferred stock, par value $0.01 per share$.01. (the “Series J-1K Preferred Stock”).  On April 19, 2019, the Company issued 2,353,548 shares of Series J-1 Preferred Stock.  The issuance was in lieu of the Series J Preferred Stock that should have been issued on September 1, 2017, and in settlement for not receiving preferred stock until 20 months after the debt for which the stock was issued was cancelled. The Company reflected an expense in general and administrative costs in the quarter ended June 30, 2019 totaling $1,140,000.
 

GT BIOPHARMA, INC. AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(UNAUDITED)
Shares of the Series J-1K Preferred Stock are convertible at any time, at the option of the holders, into shares of the Company’s common stock at an effective conversion pricerate of $0.20 per100 shares of common stock for each share subject to adjustment for, among other things, stock dividends, stock splits, combinations, reclassifications of our capital stock and mergers or consolidations, and subject to a beneficial ownership limitation which prohibits conversion if such conversion would result in the holder (together with its affiliates) being the beneficial owner of in excess of 9.99% of the Company’s common stock.Series K Preferred. Shares of the Series J-1K Preferred Stock have the same voting rights a shares of the Company’s common stock, with the holders of the Series J-1K Preferred Stock entitled to vote on an as-converted-to-common stock basis, subject to the beneficial ownership limitation, described above, together with the holders of the Company’s common stock on all matters presented to the Company’s stockholders. The Series J-1K Preferred Stock are not entitled to any dividends (unless specifically declared by the Board), but will participate on an as-converted-to-common-stock basis in any dividends to the holders of the Company’s common stock. In the event of the Company’s dissolution, liquidation or winding up, the holders of the Series J-1K Preferred Stock will be on parity with the holders of the Company’s common stock and will participate, on a on an as-converted-to-common stock basis, in any distribution to holders of the Company’s common stock.
 
4.            As of March 31, 2021, there were no Series K Preferred stock issued and outstanding.
Stock Options and Warrants

 
Stock OptionsWarrants
Stock warrant transactions for the three months ended March 31, 2021:
 
 
Number of Warrants
 
 
Weighted Average Exercise Price
 
Outstanding at December 31, 2020:
  221,041 
 $3.40 
Granted
  5,192,250 
  5.50 
Forfeited/canceled
  - 
  - 
Exercised
  (94,424)
  3.23 
Outstanding at March 31, 2021
  5,318,867 
 $5.44 
Exercisable at March 31, 2021
  5,318,867 
 $5.44 
As of March 31. 2021, all issued and outstanding warrants are fully vested and the intrinsic value of these warrants amounted to $7,415,000.
 
The following table summarizes stock optionwere transactions forduring the sixthree months ended June 30, 2020:March 31, 2021:
 
 
 
Number of Options
 
 
Weighted Average Exercise Price
 
Outstanding, December 31, 2019
  40 
 $877.50 
Granted
  - 
  - 
Exercised
  - 
  - 
Expired
  - 
  - 
Outstanding, June 30, 2020
  40 
 $877.50 
Exercisable, June 30, 2020
  40 
 $877.50 
Common Stock Warrants
Warrant transactions forOn February 16, 2021, as part of the six months ended June 30, 2020 are as follows:
 
 
Number of Warrants
 
 
Weighted Average Exercise Price
 
Outstanding at December 31, 2019:
  1,813,053 
 $0.20 
Granted
  5,500,000 
 $0.20 
Forfeited/canceled
  480,352 
 $0.20 
Exercised
  - 
  - 
Outstanding at June 30, 2020
  6,832,701 
 $0.20 
Exercisable at June 30, 2020
  6,832,701 
 $0.20 

GT BIOPHARMA, INC. AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(UNAUDITED)
Settlement Warrants
Pursuant to the Settlement Agreement,Company’s public offering, the Company issued pre-funded warrants to investors to purchase up to an aggregate of 5,500,0005,192,250 shares of common stock (the “Settlement Warrants”) atstock. The warrants have an exercise price of $0.20$5.50 per share, subject to adjustment in certain circumstances. The Settlement Warrantscircumstances and will expire on June 19, 2025. The aggregate exercise price of the Settlement Warrants was deemed to be pre-funded to the Company in conjunction with exchange of previously issued warrants to purchase 480,352 shares of common stock pursuant to the Settlement Agreement. Exercise of the Settlement Warrant is subject to certain additional terms and conditions, including certain beneficial ownership limitations.
Forbearance Agreements
Pursuant to the Forbearance Agreements,(i) the exercise price of all warrants to purchase common stock held by holders of the Default Notes will be reduced to equal the conversion price of the Default Notes and (ii)the number of shares of common stock underlying such warrants shall be increased so that the total exercise price of all such warrants after the decrease in the exercise price equals the total exercise price of all such warrants prior to the decrease in the exercise price. Further, the expiration date of all such warrants shall be extended for three years following the closing date of any New Financing.five years.
 
5.            
Commitments and Contingencies
Leases
On October 1, 2018,During the Company entered into a three-year lease agreement for its office in Westlake Village, CA. In addition to minimum rent, certain leases require payment of real estate taxes, insurance, common area maintenance charges and other executory costs. The Company recognizes rent expense under such arrangements on a straight-line basis over the effective term of each lease.
The following table summarizes the Company’s future minimum lease commitments as of June 30, 2020:
Year ending December 31:
 
 
 
     2020
  36,000 
     2021
  61,000  
Total minimum lease payments
 $97,000  
Rent expense for the sixthree months ended June 30, 2020 and 2019 was $35,000 and $35,000, respectively.
6.            
Subsequent Events
Convertible Notes
 On July 7, 2020, the Company entered into a securities purchase agreement with certain purchasers pursuant to which March 31, 2021, the Company issued Convertible Notes in an aggregate principal amount of $3,190,000 (the “July 2020 Notes”). The July 2020 Notes are convertible at any time, at the holder’s option, into shares of our common stock at an initial conversion price of $0.20 per share, subject to certain beneficial ownership limitations (with a maximum ownership limit of 9.99%).

GT BIOPHARMA, INC. AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(UNAUDITED)
The July 2020 Notes mature on January 7, 2021, unless earlier converted or repurchased. The terms of the July 2020 Notes are generally the same as the Company’s other Convertible Notes, except that the July 2020 Notes will be subject to mandatory conversion in the event of the completion of a future financing in the amount of at least $15 million at a conversion price equal to the lesser of (i) the conversion price in effect for the July 2020 Notes on the date of completion of such financing or (ii) 75% of the lowest per share price at which common stock may be issued in connection with any conversion rights associated with the financing, in each case, subject to the beneficial ownership limitations described above. See Note 2,Debtunder the caption “Convertible Notes/Debentures” for additional information regarding the terms of the Company’s Convertible Notes.
Common Stock
In July 2020, the Company issued 1,125,00094,424 shares of common stock upon conversionexercise of $225,000 aggregate principal amountwarrants which also resulted cash proceeds of Convertible Notes.$58,000.
 
WarrantNote 8 – Related Party
 
On July 28, 2020,During the period ended March 31, 2021, the Company recorded consulting expense of $250,000 for services rendered by a consultant who is also an owner of approximately 10% of the Company’s issued and outstanding common stock. In addition, the Company also issued a warrantnote payable to purchase up to an aggregatethis consultant of 1,000,000 shares$525,000 in exchange for the cancellation of common stockunpaid consulting fees of $525,000 that was recorded as part of accrued expenses at an exercise price of $0.20 per share, subject to adjustment in certain circumstances. The warrant expires on July 28, 2025. The warrantDecember 31, 2020. There was issued as compensation for certain services provided tono similar consulting expense incurred during the Company.period ended March 31, 2020.
 
Employment AgreementsNote 9 – Equity Compensation to Officers and Board of Directors
 
Effective August 11, 2020 (the “Effective Date”), the CompanyAs part of employment agreements with its CEO and Anthony J. Cataldo (“Mr. Cataldo”) entered into an employment agreement (the “Cataldo Agreement”) with respectits CFO, these officers were to Mr. Cataldo’s continued employment as Chief Executive Officer of the Company. The term of the Cataldo Agreement is three years (the “Initial Term”) with the option of automatic one-year renewals thereafter. Mr. Cataldo will be paidreceive a cash salary of $30,000 per month, together with customary benefits, expense reimbursement and the possibility of performance bonuses. Mr. Cataldo will receive afully vested stock grant equal to ten percentaggregate of 10% and 1.5% of the fully diluted shares of common stock of the Company (calculated with the inclusion of the current stock holdings of Mr. Cataldo) upon conversion of options, warrants and Convertible Notes in association with a national markets qualified financing as consideration for entering into the Cataldo Agreement (with such stock to vest and be delivered within 30 days after the national markets qualified financing). Mr. Cataldo will be entitledIn addition, the Company also granted similar equity compensation to certain additional severance payments and other benefits in connection with a Change in Control Period Involuntary Termination or a Non Change in Control Period Involuntary Termination (each as defined in the Cataldo Agreement) or his resignation as a result of a Change in Control Period Good Reason or Non Change in Control Period Good Reason (each as defined in the Cataldo Agreement). Following the Effective Date, Mr. Cataldo will also continue to serve as the chairmanmembers of the boardCompany’s Board of the Company.
Effective August 11, 2020, the Company and Steven Weldon (“Mr. Weldon”) entered into an employment agreement (the “Weldon Agreement” and, together with the Cataldo Agreement, the “Employment Agreements”) with respectDirectors wherein these directors were to Mr. Weldon's continued employment as the Chief Financial Officer of the Company. The term of the Weldon Agreement is three years (the “Initial Term”) with the option of automatic one-year renewals thereafter. Mr. Weldon will be paid a cash salary of $25,000 per month, together with customary benefits, expense reimbursement and the possibility of performance bonuses. Mr. Cataldo will receive a stock grant equal to seven percent1% and 1.25% of the fully diluted shares of common stock of the Company. Pursuant to the agreement, approximately 75% of the common stock to be issued vested immediately while the remaining 25% will vest over a period of two years.
On February 16, 2021, the Company (calculatedcompleted its equity offering and listed its shares of common stock on the Nasdaq Capital Markets (see Note 7). As such, 4,379,407 shares of its common stock were granted to these officers and directors which had a fair value of $18,621,000. Pursuant to current accounting guidelines, as the grant of the common stock is subject to milestone or performance condition, the Company measured the fair value of the common stock on the respective date of the agreement, and then such award was recorded as compensation expense as the milestone or performance condition is met and in accordance with its vesting term of the grant.

During the period ended March 31, 2021, the Company recognized stock compensation of $14,296,000 to account equity compensation to officers and directors of the 3,640,816 shares that vested.
As of March 31, 2021, the fair value of the 738,591 unvested shares that will be recognized as compensation in future periods amounted to $4,325,000.
Note 10 – Commitments and Contingencies
1. 
Litigation
We are involved in certain legal proceedings that arise from time to time in the ordinary course of our business. Except for income tax contingencies, we record accruals for contingencies to the extent that our management concludes that the occurrence is probable and that the related amounts of loss can be reasonably estimated. Legal expenses associated with the inclusioncontingency are expensed as incurred. There is no current or pending litigation of any significance with the exception of the current stock holdingsmatters that have arisen under, and are being handled in, the normal course of Mr. Weldon) upon conversionbusiness.
a. 
On August 28, 2019, a complaint was filed in the Superior Court of options, warrantsCalifornia, County of Los Angeles, West Judicial District, Santa Monica Courthouse, Unlimited Civil Division by Jeffrey Lion, an individual (“Lion”), and Convertible Notesby Daniel Vallera, an individual (“Vallera”). Lion and Vallera are referred to jointly as the “Plaintiffs”. The complaint was filed against GT Biopharma, Inc. and its subsidiary Oxis Biotech, Inc. (either of them or jointly, the “Company”). The Plaintiffs allege breach of a license agreement between the Plaintiffs and the Company entered into on or about September 3, 2015. Lion alleges breach of a consulting agreement between Lion and the Company entered into on or about September 1, 2015. Vallera alleges breach of a consulting agreement between Vallera and the Company entered into in association with a national markets qualified financing as considerationor around October, 2018. The Complaint seeks actual damages of $1,670,000, for entering into the Weldon Agreement (withfair market value of the number of shares of GT Biopharma, Inc. that at the time of judgment represent 882,353 shares of such stock as of September 1, 2015, and that GT Biopharma, Inc. issue Lion the number of common shares of GT Biopharma, Inc. that at the time of judgment represent 882,353 such shares as of September 1, 2015.The Company filed an answer to vestthe complaint denying many allegations and be delivered within 30 days afterasserting affirmative defenses. Discovery has commenced and trial is scheduled for May, 2022. The Company believes the national markets qualified financing). Mr. Weldoncase is without merit and will be entitled to certain additional severance payments and other benefits in connection withdefend it vigorously.
b. 
On March 3, 2021 a Change in Control Period Involuntary Termination or a Non Change in Control Period Involuntary Termination (each as definedcomplaint was filed by Sheffield Properties in the Weldon Agreement)superior Court of California. County of Ventura. The litigation arises from a commercial lease entered into by GT Biopharma for office space in Westlake Village. GT Biopharma has been served but has not yet answered the complaint. Sheffield Properties seeks damages in excess of $250,000. We intend to vigorously defend against these claims. We believe we have made adequate provision in our financial statements to provide for any potential settlement.
2. 
Research and Development Agreement:
We are party to an exclusive worldwide license agreement with the Regents of the University of Minnesota, to further develop and commercialize cancer therapies using TriKE technology developed by researchers at the university to target NK cells to cancer. Under the terms of the agreement, we receive exclusive rights to conduct research and to develop, make, use, sell, and import TriKE technology worldwide for the treatment of any disease, state or his registration as a result of a Changecondition in Control Period Good Reasonhumans. We are responsible for obtaining all permits, licenses, authorizations, registrations and regulatory approvals required or Non Change in Control Period Good Reason (each as definedgranted by any governmental authority anywhere in the Weldon Agreement). Followingworld that is responsible for the Effective Date, Mr. Weldon will also continue to serveregulation of products such as the principal accounting officerTriKE technology, including without limitation the FDA in the United States and asthe European Agency for the Evaluation of Medicinal Products in the European Union. We are presently evaluating GTB-3550, our lead TriKE therapeutic product candidate in a directorPhase I/II clinical trial. Under the agreement, the University of Minnesota will receive an upfront license fee, royalty fees ranging from 4% to 6%, minimum annual royalty payments of $0.25 million beginning in 2022, $2.0 million in 2025, and $5.0 million in 2027 and certain milestone payments totaling $3.1 million.
During the Company.
period ended March 31, 2021, the Company recorded research and development expenses of $224,000 pursuant to this agreement.
Note 11- Subsequent Events 
Subsequent to March 31, 2021, the Company issued 1,274,096 shares of common stock upon exercise of warrants for cash proceeds of $7,008,000.
Subsequent to March 31, 2021, the Company issued a total of 5,336,191 shares of common stock to noteholders whose notes payable and accrued interest were mandatorily converted to common stock on February 16, 2021 (see Note 4)
 

 
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
 
CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS
 
Some of the statements in this Quarterly Report on Form 10-Q are “forward-looking statements” within the meaning of the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements regarding our current beliefs, goals and expectations about matters such as our expected financial position and operating results, our business strategy and our financing plans. The forward-looking statements in this report are not based on historical facts, but rather reflect the current expectations of our management concerning future results and events. The forward-looking statements generally can be identified by the use of terms such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “foresee,” “may,” “guidance,” “estimate,” “potential,” “outlook,” “target,” “forecast,” “likely” or other similar words or phrases. Similarly, statements that describe our objectives, plans or goals are, or may be, forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be different from any future results, performance and achievements expressed or implied by these statements. We cannot guarantee that our forward-looking statements will turn out to be correct or that our beliefs and goals will not change. Our actual results could be very different from and worse than our expectations for various reasons. You should review carefully all information, including the discussion of risk factors under “Part I. Item 1A: Risk Factors” and “Part II. Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Form 10-K for the year ended December 31, 2019.2020. Any forward-looking statements in the Form 10-Q are made only as of the date hereof and, except as may be required by law, we do not have any obligation to publicly update any forward-looking statements contained in this Form 10-Q to reflect subsequent events or circumstances.
 
Throughout this Quarterly Report on Form 10-Q, the terms “GTBP,” “we,” “us,” “our,” “the company” and “our company” refer to GT Biopharma, Inc., a Delaware corporation formerly known as Oxis International, Inc., DDI Pharmaceuticals, Inc. and Diagnostic Data, Inc, together with our subsidiaries.
 
Overview
 
We are a clinical stage biopharmaceutical company focused on the development and commercialization of novel immuno-therapeuticimmuno-oncology products based onoff our proprietary Tri-specific Killer Engager (TriKE™) and Tetra-specific Killer Engager (TetraKE™) platform technologies.fusion protein immune cell engager technology platform. Our TriKE and TetraKE platformsplatform generate proprietary therapeutic candidates that aretherapeutics designed to harness and enhance the immune responsecancer killing abilities of a patient’s endogenousown natural killer cells, or NK cells. Once bound to an NK cell, our platform moieties are designed to enhance the activity of NK cells, with targeted directioncell, and precisely direct it to one or more specifically-targeted proteins expressed on a specific type of cancer cell or virus infected cell, ultimately resulting in the targeted cellcell’s death. We have constructed our TriKEs and TetraKEs of recombinant fusion proteins thatTriKE can be designed to target a wide arrayany number of tumor antigen that may be locatedantigens on hematologic malignancies, sarcomas or solid tumors. Our TriKEstumors and TetraKEs do not require patient-specific or autologous customization.
 
We are using our TriKE and TetraKE platformsplatform with the intent to bring to market immuno-oncology products that can treat a range of hematologic malignancies, sarcomas,sarcoma and solid tumors and selected infectious diseases. Our platforms aretumors. The platform is scalable, and in addition to our first clinical indication of our TriKE platform in relapsed or refractory acute myelogenous leukemia, we are preparing investigational new drug applications based onputting processes in place to be able to produce IND-ready moieties in a timely manner after a specific TriKE or TetraKEconceptual design. We intend to continue to advanceAfter conducting market and competitive research, specific moieties can then be advanced into the clinic on our own or through potential collaborations with larger companies, multiple TriKE or TetraKE product candidates.companies. We are also evaluating, in conjunction with our Scientific Advisory Board, additional moieties designed to target different tumor antigens. We believe our TriKEs and TetraKEsTriKE may have the ability, if approved for marketing, to be used as a monotherapy, be dosed concomitantly withaugment the current monoclonal antibody therapeutics, be used in conjunction with more traditional cancer therapy and potentially overcome certain limitations of current chimeric antigen receptor, or CAR-T, therapy.
 
We are also using our TriKE and TetraKE platformsplatform to develop therapeutics useful for the treatment of infectious diseasesdisease such as for the treatment of patients infected by the human immunodeficiency virus (“HIV”) and COVID-19 infection. For example, while(HIV). While the use of anti-retroviral drugs has substantially improved the morbidityhealth and mortalityincreased the longevity of individuals infected with HIV, these drugs are designed to suppress virus replication and to help modulate progression to AIDS and to limit further transmission of the virus. Despite the use of anti-retroviral drugs, infected individuals retain reservoirs of latent HIV-infected cells that, upon cessation of anti-retroviral drug therapy, can reactivate and reestablishre-establish an active HIV infection. DestructionFor a curative therapy, destruction of these latent HIV infected cells is the primary objective of curative therapy. Ourmust take place. The HIV-TriKE contains the antigen binding fragment (Fab) from a broadly-neutralizing antibody targeting the HIV-Env protein. The HIV-TriKE is designed to target HIV while redirecting NK cell killing specifically to actively replicating HIV infected cells. The HIV-TriKE induced NK cell proliferation, and demonstrated the ability in vitro to reactivate and kill HIV-infected T-cells. These findings indicate a potential role for the HIV-TriKE in the reactivation and elimination of the latently infected HIV reservoir cells by harnessing the NK cell’s ability to mediate the antibody-directed cellular cytotoxicity.cytotoxicity (ADCC).
 

We have licensedOur initial work has been conducted in collaboration with the exclusive rights fromMasonic Cancer Center at the University of Minnesota under a program led by Dr. Jeffrey Miller, the Deputy Director. Dr. Miller is a recognized leader in the field of NK cell and IL-15 biology and their therapeutic potential. We have exclusive rights to the TriKE platform and TetraKE platforms.are generating additional intellectual prop

 
Recent Developments
 
Collaboration Agreement
On March 10, 2020,February 16, 2021, we entered intocompleted a collaboration agreement with Cytovance® Biologics, a USA-based contract development and manufacturing organization and a subsidiarypublic offering of Hepalink, to provide development services for a TriKE therapeutic for the treatment of the coronavirus infection. Under the terms of the collaboration agreement, the companies will focus on preparing sufficient quantities of our coronavirus TriKE drug product for preclinical evaluation using Cytovance’s E. coli-basedKeystone Expression System™ and subsequently, will scale-up production using Cytovance’s GMP microbial manufacturing platform for evaluation of TriKE in humans to treat the coronavirus infection.
Bridge Financing
Between April 20 and July 7, 2020, we entered into securities purchase agreements pursuant to which we issued Convertible Notes (including the July 2020 Notes) in an aggregate principal amount of approximately $5.2 million (collectively, the “Bridge Notes”), which, together with an additional $0.4 million aggregate principal amount of Convertible Notes issued between December 2019 and January 2020, completed our previously announced bridge financing (the “Bridge Financing”) resulting in gross proceeds to us of approximately $5.6 million. The Bridge Notes are convertible at any time, at the holder’s option, into4,945,000 shares of our common stock at an initial conversion pricefor net proceeds of $0.20 per share, subject to certain beneficial ownership limitations (with a maximum ownership limit of 9.99%).
The Bridge Notes each have a term of six months$24,679,000, after deducting underwriting discounts, commissions and mature between August 20, 2020 and January 7, 2021, unless earlier converted or repurchased. The terms of the Bridge Notes are generally the same as the Company’s other Convertible Notes, except that the Bridge Notes will be subject to mandatory conversion in the event of the completion of a future financing in the amount of at least $15 million at a conversion price equal to the lesser of (i) the conversion price in effect for the Bridge Notes on the date of completion of such financing or (ii) 75% of the lowest per share price at which common stock may be issued in connection with any conversion rights associated with the financing, in each case, subject to the beneficial ownership limitations described above.
The additional $0.4 million aggregate principal amount of Convertible Notes issued between December 2019 and January 2020 asdirect offering expenses. As part of the Bridge Financing have the same terms as the Bridge Notes, except that they are not subject to mandatory conversion in connection with a subsequent financing.
See Note 2,Debtunder the caption “Convertible Notes/Debentures” for additional information regarding the terms of the Company’s Convertible Notes.
Forbearance Agreements
Effective as of June 23, 2020,offering, we entered into the Forbearance Agreements with the holders of approximately $13.2 million aggregate principal amount of the Default Notes, which are currently in default. Pursuant to the Forbearance Agreements, the holders of the Default Notes have agreed to forbear from exercising their rights and remedies under the Default Notes (including declaring such Default Notes (together with default amounts and accrued and unpaid interest) immediately due and payable) until the earlier of (i) the date that we complete a New Financing or (ii) the Termination Date.

Pursuant to the Forbearance Agreement, the holders of the Default Notes have also agreed that the Default Notes (together with default amounts and accrued and unpaid interest) will be converted into common stock upon the closing of a New Financing at a conversion price equal to the lesser of (i) the conversion price in effect for the Default Notes on the date of such New Financing or (ii) 75% of the lowest per share price at which common stock is or may be issued in connection with such New Financing, in each case, subject to certain beneficial ownership limitations (with a maximum ownership limit of 9.99%). Shares of our preferred stock, which are convertible into the Company’s common stock, will be issued in lieu of common stock to the extent that conversion of the Default Notes is prohibited by such beneficial ownership limitations.
In addition, to the extent that any holders of the Default Notes also holdgranted these investors warrants to purchase 5,192,250 shares of the Company’s common stock, the exercise price, number of underlying sharesstock. The warrants are fully vested, exercisable at $5.50 per share and expiration date of such warrants will also be subject to adjustment upon closing of a New Financingexpire in accordance with the terms of the Forbearance Agreements.
Settlement with Empery Funds
Settlement Agreement
On June 19, 2020, we entered into the Settlement Agreement with the Empery Funds, Anthony Cataldo and Paul Kessler resolving all remaining disputes between the parties pertaining to the Original Securities. See Part II, Item 1. “Legal Proceedings.”five years.
 
As a result of the Settlement Agreement,completion of the Company paidpublic offering and the Empery Funds cash payments in an aggregate amountsuccessful listing of $0.2 million. In addition, pursuant to the Settlement Agreement, the Company issued to the Empery Funds, solely in exchange for the outstanding Original Securities, (i) an aggregate of 3.5 millionour shares of common stock (ii) pre-funded warrants to purchase an aggregate of 5.5 million shares of common stock and (iii) Convertible Notes inon the Nasdaq Capital Markets, convertible notes with an aggregate principal amount of $0.45 million.$33,272,000 and accrued interest of $5,534,000 mandatorily converted at its stated conversion rate of $3.40 per share into 11,413,322 shares of our common stock (see Note 4 of the Financial Statements).
 
Settlement Notes
The Settlement Notes are convertible at any time, at the holder’s option, intoAs part of consulting agreements with certain consultants, we agreed to grant these consultants shares of common stock at an initial conversion priceequal to 1% and 3% of $0.20 per share, subjectthe fully diluted shares of our common stock upon completion of a qualified financing and listing on a national market as consideration for entering into such consulting agreement (with such stock to certain beneficial ownership limitations (withvest and be delivered within 30 days after the national markets qualified financing). Pursuant to the consulting agreement, approximately 75% of the common stock to be issued will vest immediately while the remaining 25% will vest over a maximum ownership limitperiod of 4.99%). The Settlement Notes mature on December 19, 2020.Thetwo years.
On February 16, 2021, we completed a qualified equity offering and listing. As a result, we granted these consultants 2,502,518 shares of common stock. During the period ended March 31, 2021, pursuant to the vesting terms of the Settlement Notes are generallyconsulting agreements, we issued 1,807,374 shares of common stock to these consultants and recorded the same ascorresponding stock compensation expense of $7,239,000. In addition, we also issued 150,000 shares of common stock with a fair value of $1,213,000 to other consultants for services rendered.
During the Company’s other Convertible Notes,except thatthree months ended March 31, 2021, we also issued 189,753 shares of common stock for a research and development agreement valued at $1,355,000. The common shares were valued on the Company is required to make an offer to repurchase,market price at the holder’s option, the Settlement Notes at price in cash equal to 100% of the aggregate principal amount of the Settlement Notes plus accrued and unpaid interest, if any, to, but excluding, the date of repurchase followinggrant.
During the consummation bythree months ended March 31, 2021, we issued 94,824 shares of common stock upon the Companyexercise of a financing transaction, or a series of transactions,warrants resulting in aggregate grosscash proceeds to the Company in excess of $7.5 million.$58,000.
 
Settlement WarrantsOn February 16, 2021, as a result of the completion of the public offering and the successful listing of our shares of common stock on the Nasdaq Capital Markets, 2,353,548 shares of Series J-1 Preferred Stock mandatorily converted at a conversion rate of $3.40 per share into 692,220 shares of our common stock. (See Note 7 of our Financial Statements)
 
The Settlement Warrants provide for theOn February 16, 2021, as part of our public offering of common stock and warrants, we issued warrants to investors to purchase of up to an aggregate of 5.5 million5,192,250 shares of common stock atstock. The warrants have an exercise price of $0.20$5.50 per share, subject to adjustment in certain circumstances and will expire on June 19, 2025. Exercisein five years. (See Note 7 of our Financial Statements)
As part of employment agreements with our CEO and CFO, these officers were to receive a fully vested stock grant of shares of common stock equal to aggregate of 10% and 1.5% of the warrant is subjectfully diluted shares of our common stock (calculated with the inclusion of the current stock holdings of Mr. Cataldo) upon conversion of options, warrants and convertible notes in association with a national markets qualified financing as consideration for entering into the Agreement (with such stock to certain additional termsvest and conditions, including certain beneficial ownership limitations (withbe delivered within 30 days after the national markets qualified financing). In addition, we also granted similar equity compensation to members of our Board of Directors wherein these directors were to receive stock grant equal to 1% and 1.25% of the fully diluted shares of our common stock. Pursuant to these agreement, approximately 75% of the common stock to be issued will vest immediately while the remaining 25% will vest over a maximum ownership limitperiod of 4.99%).two years.
 
On February 16, 2021, as a result of the completion of the public offering and the successful listing of our shares of common stock on the Nasdaq Capital Markets, we granted 4,379,407 shares of common stock to these officers and directors which had a fair value of $18,621,000.
Subsequent to March 31, 2021, we issued 1,274,096 shares of common stock upon exercise of warrants for cash proceeds of $7,008,000.
Subsequent to March 31, 2021, we issued a total of 5,336,191 shares of common stock to noteholders whose notes payable and accrued interest were mandatorily converted to common stock on February 16, 2021 (see Note 4 of the Financial Statements)
On April 23, 2021, our Compensation Committee approved an amendment and restatement of the employment agreements of Anthony Cataldo, the Chief Executive Officer and Michael Handelman, the Chief Financial Officer. (See Part II, Item 5 of this report)
On April 23, 2021, Dr. Gregory Berk resigned as a director and accepted employment as our Chief Medical Officer. In connection with his appointment as Chief Medical Officer, the Compensation Committee approved a four year employment agreement for Dr. Berk. (See Part II, Item 5 of this report)
 

 
Results of Operations
 
Comparison of the Three Months Ended June 30,March 31, 2021 and 2020 and 2019
 
Research and Development Expenses
 
During the three months ended June 30,March 31, 2021 and 2020, and 2019, we incurred $12 thousand$1,640,000 and $154 thousand of$324,000 research and development expenses, respectively.an increase of $1,316,000. Research and development costs decreasedincreased due primarily to the reductionissuance of employee, consultant and preclinical expenses.189,753 shares of common stock as payment of a fee valued at $1,355,000. We anticipate our direct clinical costs willto increase in the second halfremainder of 2020 with2021 upon the continuation of our Phase Ia phase one/two clinical trial of our most advanced TriKe product candidate, GTB-3550.OXS-3550.
 
Selling, general and administrative expenses
 
During the three months ended June 30,March 31, 2021 and 2020, and 2019, we incurred $1.5 million$27,362,000 and $2.1 million$746,000 of selling, general and administrative expenses, respectively.expenses.  The decreaseincrease in selling, general and administrative expenses is primarily attributable the reductionincrease in stock based compensation. In the period ended March 31, 2021 we incurred $21,535,000 of payrollstock based compensation, we incurred no such expenses during 2020.
Change in fair value of derivative liability
Change in fair value of derivative liability was a gain of $21,000 for the three months ended March 31, 2021 and stock compensation expenses.we had no such gain or loss for the same period in 2020.
 
Interest Expense
 
Interest expenses were $4.6 millionexpense was $696,000 and $0.5 million$638,000 for the three months ended June 30,March 31, 2021 and 2020 and 2019, respectively.  The increase is primarily due to the accrual of default interest under the Default Notes.
Comparison of the Six Months Ended June 30, 2020 and 2019
Research and Development Expenses
During the six months ended June 30, 2020 and 2019, we incurred $336 thousand and $1 million of research and development expenses, respectively. Research and development costs decreased due primarily to the reduction of employee, consultant and preclinical expenses. We anticipate our direct clinical costs will increase in the second halfamount of 2020 upon the continuation of our Phase I clinical trial of our most advanced TriKe product candidate, GTB-3550.
Selling, general and administrative expenses
During the six months ended June 30, 2020 and 2019, we incurred $2.3 million and $5.3 million of selling, general and administrative expenses, respectively.  The decrease in selling, general and administrative expenses is primarily attributable the reduction of payroll and stock compensation expenses.
Interest Expense
Interest expenses were $5.3 million and $0.9 million for the six months ended June 30, 2020 and 2019 respectively.  The increase is primarily due to the accrual of default interest under the Default Notes..outstanding convertible notes.
 
Liquidity and Capital Resources
 
The Company’s current operations have focused on business planning, raising capital, establishing an intellectual property portfolio, hiring, and conducting preclinical studies and clinical trials. The Company does not have any product candidates approved for sale and has not generated any revenue from product sales. The Company has sustained operating losses since inception and expects such losses to continue over the foreseeable future. During the sixthree months ended June 30, 2020,March 31, 2021, the Company raised $4.5the net amount of $24.7 million through issuance of common stock, raised $1.2 million from a series of issuances of Convertible Notes. convertible notes as compared to $0.2 million during the same period in 2020. We anticipate that cash utilized for selling, general and administrative expenses will range between $1 and $2 million in the coming quarters, while research and development expenses will vary depending on clinical activities. The Company is pursuing several alternatives to address this situation, including the raising of additional funding through equity or debt financings. In order to finance existing operations and pay current liabilities over the next 12 months, the Company will need to raise an additional $15 million of capital in 2020.activities.
 
The financial statements of the Company have been prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Accordingly, the financial statements do not include any adjustments that might be necessary should the Company be unable to continue in existence.
 

The Company has incurred substantial losses and negative cash flows from operations since its inception and has an accumulated deficit of $577 million and cash of $851 thousand$27.6 million as of June 30, 2020.March 31, 2021. The Company anticipates incurring additional losses until such time, if ever, that it can generate significant sales or revenue from out-licensing of its products currently in development. Substantial additional financing will be needed by the Company to fund its operations and to commercially develop its product candidates. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
  
Management is currently evaluating different strategies to obtain the required funding for future operations. These strategies may include but are not limited to: public offerings of equity and/or debt securities, payments from potential strategic research and development, licensing and/or marketing arrangements with pharmaceutical companies. Management has also implemented cost saving efforts, including reduction in executive salaries and reduced travel. Management believes that these ongoing and planned financing endeavors, if successful, will provide adequate financial resources to continue as a going concern for at least the next sixnine months from the date the financial statements are issued; however, there can be no assurance in this regard. If the Company is unable to secure adequate additional funding, its business, operating results, financial condition and cash flows may be materially and adversely affected.
 

Critical Accounting Policies
 
We consider the following accounting policies to be critical given they involve estimates and judgments made by management and are important for our investors’ understanding of our operating results and financial condition.
  
Basis of Presentation and Principles of Consolidation
 
The accompanying consolidated financial statements containedhave been prepared in this reportaccordance with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of GT Biopharma,the Company and its wholly owned subsidiaries, Oxis Biotech, Inc. and its subsidiaries. All intercompanyGeorgetown Translational Pharmaceuticals, Inc. Intercompany transactions and balances and transactions have been eliminated.eliminated in consolidation.
 
Long-Lived AssetsReverse Stock Split
 
Our long-livedOn February 10, 2021, the Company completed a 1:17 reverse stock split of the Company's issued and outstanding shares of common stock and all fractional shares were rounded up. All share and per share amounts in the accompanying financial statements have been adjusted retroactively to reflect the reverse stock split as if it had occurred at the beginning of the earliest period presented.
Accounting Estimates
The preparation of financial statements in conformity with Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include property, plantaccruals for potential liabilities, valuation of notes payable, assumptions used in deriving the fair value of derivative liabilities, share-based compensation and equipment, capitalized costsbeneficial conversion feature of filing patent applicationsnotes payable, and goodwillvaluation of deferred tax assets. Actual results could differ from those estimates.
Stock-Based Compensation
The Company accounts for share-based awards to employees and other assets.  We evaluate our long-lived assets for impairmentnonemployees and consultants in accordance with the provisions of ASC 360, whenever events or changes in circumstances indicate718, Compensation-Stock Compensation. Stock-based compensation cost is measured at fair value on the grant date and that the carrying amount of such assets may not be recoverable.  Estimates of future cash flows and timing of events for evaluating long-lived assets for impairment are based upon management’s judgment.  If any of our intangible or long-lived assets are considered to be impaired, the amount of impairment to befair value is recognized is the excess of the carrying amount of the assets over its fair value.
Applicable long-lived assets are amortized or depreciatedas expense over the shorter of their estimated useful lives, the estimated period that the assets will generate revenue,requisite service, or the statutory or contractual term in the case of patents.  Estimates of useful lives and periods of expected revenue generation are reviewed periodically for appropriateness and are based upon management’s judgment.  Goodwill and other assets are not amortized.
Certain Expenses and Liabilities
On an ongoing basis, management evaluates its estimates related to certain expenses and accrued liabilities.  We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of liabilities that are not readily apparent from other sources.  Actual results may differ materially from these estimates under different assumptions or conditions.vesting, period.
  
Inflation
 
We believe that inflation has not had a material adverse impact on our business or operating results during the periods presented.
 

Off-balance Sheet Arrangements
 
We have no off-balance sheet arrangements as of June 30, 2020.March 31, 2021.
 
Item 3.   Quantitative Qauantitative andnd Qualitative Disclosures About Market Risk
 
This company qualifies as a smaller reporting company, as defined in 17 C.F.R. §229.10(f)(1) and is not required to provide information by this Item.

 
Item 4.   Controls and Procedures
 
Evaluation of Disclosure Controls and Procedures
 
Our principal executive officer and principal financial officer evaluated the effectiveness of our “disclosure controls and procedures” (as such term is defined in Rules 13a-15(e) and 15d-15(e) of the United States Securities Exchange Act of 1934, as amended (the “Exchange Act”)), as of June 30, 2020.March 31, 2021. Based on that evaluation we have concluded that our disclosure controls and procedures were not effective as of June 30, 2020March 31, 2021 as a result of material weaknesses in internal control over financial reporting due to (i) inadequate segregation of duties, (ii) risks of executive override and (iii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both U.S. GAAP and SEC regulation, in each case, as described in "Item“Item 9A. Controls and Procedures"Procedures” in the Company'sCompany’s Form 10-K for the year ended December 31, 2019.2020.
 
The Company is taking steps, and intends to take additional steps, to mitigate the issues identified and implement a functional system of internal control over financial reporting. Such measures will include, but not be limited to: hiring of additional employees in our finance and accounting department; preparation of risk-control matrices to identify key risks and develop and document policies to mitigate those risks; and identification and documentation of standard operating procedures for key financial and SEC reporting activities. 
 
Changes in Internal Control over Financial Reporting
 
Except for the ongoing remediation of the material weaknesses in internal controls over financial reporting noted above, no changes in our internal control over financial reporting were made during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
 

PART II.  OTHER INFORMATION
 
Item 1.  Legal LPegal Proceedings
On December 24, 2018, the Empery Funds filed in the N.Y. Supreme Court, Index No. 656408/2018, alleging causes of action against the Company for Breach of Contract, Liquidated Damages, Damages, and Indemnification. The claims arose out of a securities purchase agreement entered into between the Empery Funds and the Company pursuant to which the Company issued the Original Securities to the Empery Funds in or around January 2018. On June 19, 2020, the Company and the Empery Funds, among others, entered into the Settlement Agreement resolving all remaining disputes between the parties pertaining to the Original Securities. See “ Part I, Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations—“under the caption”Recent Developments—Settlement with Empery Funds.”roceedings
 
On August 28, 2019, a complaint was filed in the Superior Court of California, County of Los Angeles, West Judicial District, Santa Monica Courthouse, Unlimited Civil Division by Jeffrey Lion, an individual (“Lion”), and by Daniel Vallera.Vallera, an individual (“Vallera”). Lion and Vallera are referred to jointly as the “Plaintiffs.”“Plaintiffs”. The complaint was filed against the CompanyGT Biopharma, Inc. and its subsidiary Oxis Biotech, Inc. (either of them or jointly, the “Defendant”“Company”). The Plaintiffs allege breach of a license agreement between the Plaintiffs and the DefendantCompany entered into on or about September 3, 2015. Lion alleges breach of a consulting agreement between Lion and the DefendantCompany entered into on or about September 1, 2015. Vallera alleges breach of a consulting agreement between Vallera and the DefendantCompany entered into in or around October, 2018. The complaintComplaint seeks actual damages of $1,670,000, for the fair market value of the number of shares of the Company’s common stockGT Biopharma, Inc. that at the time of judgment represent 15,000,000882,353 shares of such stock as of September 1, 2015, and that the CompanyGT Biopharma, Inc. issue Lion the number of common shares the Company’s common stockof GT Biopharma, Inc. that at the time of judgment represent 15,000,000882,353 such shares as of September 1, 2015.2015.The Company filed an answer to the complaint denying many allegations and asserting affirmative defenses. Discovery has commenced and trial is scheduled for May, 2022. The Company believes the case is without merit and will defend it vigorously.
 

On March 3, 2021 a complaint was filed by Sheffield Properties in the superior Court of California. County of Ventura. The litigation arises from a commercial lease entered into by GT Biopharma for office space in Westlake Village. GT Biopharma has been served but has not yet answered the complaint. Sheffield Properties seeks damages in excess of $250,000. We intend to vigorously defend against these claims. We believe we have made adequate provision in our financial statements to provide for potential settlement.
 
Item 1A.  RiskRisk Factors
 
Information regarding risk factors appears under “Risk Factors” included in Part I. Item 1A. Risk Factors.Factors of our Annual Report on Form 10-K for the year ended December 31, 2019.2020. There have been no material changes from the risk factors previously disclosed in the above-mentioned periodic report.
 
Item 2.  UnregisteredUnregistered Sales of Securities and Use of Proceeds
 
The Company made the following issuances of its unregistered equity securities pursuant exemptions contained in Section 4(a)(2) or 3(a)(9) of the Securities Act of 1933, as amended (the “Securities Act”) and/or Rule 506 of Regulation D promulgated thereunder that have not previously been reported:
 
●
On May 1, 2020,In January 2021, the Company issued 1,086,429entered into securities purchase agreements with certain purchasers pursuant to which the Company issues convertible notes in an aggregate principal amount of $2,450,000, which notes are convertible into the Company’s common stock at an initial conversion price of $0.20 per share.
●
11,413,322 shares of common stock for consulting services.on or after February 16, 2021, in connection with (i) the conversion of the Company’s convertible notes or debentures upon completion of the listing on Nasdaq and (ii) payments of interest in lieu of cash with respect to the Company’s convertible notes or debentures.
●
In July 2020,83,824 shares of common stock in connection with the Company issued 1,125,000exercise of certain settlement warrants on or after February 16, 2021.
●
692,220 shares of common stock in connection with the conversion of all outstanding shares of Series J-1 Preferred Stock on February 23 and March 17, 2021.
●
5,491,638 shares of common stock to certain of the Company’s directors, executive officers and consultants as compensatory bonuses after completion of the successful listing on the Nasdaq Capital Markets on February 11, 2021.
●
1,368,520 shares of common stock upon conversionexercise of $225,000 aggregate principal amount of Convertible Notes.warrants for cash subsequent to December 31, 2020.
 
● 
On July 28, 2020, the Company issued a warrant to purchase up to an aggregate of 1,000,000 shares of common stock at an exercise price of $0.20 per share, subject to adjustment in certain circumstances. The warrant was issued as compensation for certain services provided to the Company.
Item 3.  DefaultsDefaults Upon Senior Securities.
As of June 30, 2020, convertible notes totaling approximately $13.2 million are in default.
Item 4.  Mine Safety Disclosures
 
Not applicable.
 
Item 4.  Mine Safety Disclosures
Not applicable.

Item 5. Other OIther Information.nformation.
 
Effective August 11, 2020, On April 23, 2021, Dr. Gregory Berk resigned as a member of the CompanyBoard of Directors (the “Board”).
On April 23, 2021, the Compensation Committee of the Board (the “Compensation Committee”) approved an amendment and Mr. Cataldo entered intorestatement of the CataldoEmployment Agreement with respect to Mr. Cataldo’s continued employment asAnthony Cataldo, the Chief Executive Officer, increasing his annual base salary to $500,000, setting his target bonus at 50% of his annual base salary, and extending the Company. The Initial Termterm of his agreement to four years. Upon the Cataldo Agreement is three years with the optiontermination of automatic one-year renewals thereafter. Mr. Cataldo will be paid a cash salary of $30,000 per month, together with customary benefits, expense reimbursement and the possibility of performance bonuses.Cataldo’s employment for any reason, Mr. Cataldo will receive a stock grant equalhis accrued but unpaid salary and vacation pay through the date of termination and any other benefits accrued to ten percenthim under any benefit plans outstanding at such time, and the reimbursement of documented, unreimbursed expenses incurred prior to such date. Upon the fully diluted shares of common stock of the Company (calculated with the inclusion of the current stock holdingstermination of Mr. Cataldo) upon conversion of options, warrants and Convertible Notes in association with a national markets qualified financing as consideration for entering into the Cataldo Agreement (with such stock to vest and be delivered within 30 days after the national markets qualified financing). Mr. Cataldo will be entitled to certain additional severance payments and other benefits in connection with a Change in Control Period Involuntary Termination or a Non Change in Control Period Involuntary Termination (each asemployment without cause (as defined in the Cataldohis Amended and Restated Employment Agreement) or upon Mr. Cataldo’s termination of his resignation as a result of a Change in Control Period Good Reason or Non Change in Control Period Good Reason (each asemployment for good reason (as defined in his Amended and Restated Employment Agreement) prior to the end of the term of his Amended and Restated Employment Agreement, Mr. Cataldo Agreement). Followingshall also receive (i) a lump sum payment equal to the Effective Date,greater of the amount of his annual base salary (at the then-current rate) that he would have earned through the end of the term of the agreement, and 50% of his annual base salary, plus (ii) a lump sum payment equal to the greater of the bonus paid or payable to Mr. Cataldo for the immediately preceding year, and the target bonus under the performance bonus plan, if any, in effect during the immediately preceding year, plus (iii) monthly reimbursement for the cost of medical, life and disability insurance coverage at a level equivalent to that provided by the for a period of the earlier of (a) one year and (b) the time Mr. Cataldo begins alternative employment wherein said insurance coverage is available and offered to Mr. Cataldo. All payments to Mr. Cataldo under his Amended and Restated Employment Agreement are subject to withholding of applicable taxes. Mr. Cataldo will also continuebe designated for election to serve as the chairmanBoard during the term of his Amended and Restated Employment Agreement.
On April 23, 2021, the Compensation Committee also approved an amendment and restatement of the board of the Company.
Effective August 11, 2020, the Company and Mr. Weldon entered into the WeldonEmployment Agreement with respect to Mr. Weldon's continued employment asMichael Handelman, the Chief Financial Officer, increasing his annual base salary to $375,000, setting his target bonus at 40% of his annual base salary and extending the Company. The Initial Termterm of the Weldonhis agreement to four years. Mr. Handelman entered into an Amended and Restated Employment Agreement is three years with the option of automatic one-year renewals thereafter.memorializing the foregoing amendments, on terms substantially similar to those set forth in Mr. WeldonCataldo’s Amended and Restated Employment Agreement, other than the obligation to designate Mr. Handelman for election to the Board.
On April 23, 2021, the Compensation Committee also approved the entry into an Employment Agreement with Dr. Gregory Berk pursuant to which Dr. Berk will be paid a cash salary of $25,000 per month, together with customary benefits, expense reimbursement and the possibility of performance bonuses. Mr. Cataldo will receive a stock grant equal to seven percent of the fully diluted shares of common stock of the Company (calculated with the inclusion of the current stock holdings of Mr. Weldon) upon conversion of options, warrants and Convertible Notes in association with a national markets qualified financing as consideration for entering into the Weldon Agreement (with such stock to vest and be delivered within 30 days after the national markets qualified financing). Mr. Weldon will be entitled to certain additional severance payments and other benefits in connection with a Change in Control Period Involuntary Termination or a Non Change in Control Period Involuntary Termination (each as defined in the Weldon Agreement) or his registration as a result of a Changein Control Period Good Reason or Non Change in Control Period Good Reason (each as defined in the Weldon Agreement). Following the Effective Date, Mr. Weldon will also continue to serve as the principal accounting officerChief Medical Officer for a term of four years. Dr. Berk will receive an annual base salary of $425,000 and is eligible to participate in the performance bonus plan or as otherwise determined by the Compensation Committee, with a directortarget annual bonus of 40% of his annual base salary. Concurrent with his employment the granted Dr. Berk 208,543 shares of the Company.
The summary descriptioncommon stock, vesting 25% on each of the first four annual anniversaries of the date of grant, subject to Dr. Berk’s continued service on each such vesting date, provided, that in the event of a change of control transaction, such shares shall immediately accelerate and vest. Such share award is contingent upon shareholder approval. The terms of Dr. Berk’s Employment AgreementsAgreement are otherwise substantially similar to those set forth above does not purportin Mr. Cataldo’s Amended and Restated Employment Agreement, other than the obligation to be complete and is qualified in its entirety bydesignate Dr. Berk for election to the Employment Agreements, which are filed with this Quarterly Report on Form 10-Q.Board.
 

Item 6.  Exhibits
     Incorporated by Reference      Incorporated by Reference
Exhibit Description Herewith FormNumberSEC File No. Filing DateExhibit Description Filed Herewith FormNumberSEC File No. 
Filing Date
                    
3.1
3.1
 Restated Certificate of Incorporation as filed in Delaware September 10, 1996 and as thereafter amended through March 1, 2002   10-KSB3.A000-08092 04/01/2002
3.2
3.2
 Certificate of Amendment to the Restated Certificate of Incorporation of GT Biopharma, Inc., dated February 9, 2011   10-K3.2000-08092 03/31/2011
3.3
3.3
 Certificate of Amendment to the Restated Certificate of Incorporation of GT Biopharma, Inc., effective as of July 19, 2017   8-K/A3.1000-08092 03/15/2018
3.4
3.4
 Certificate of Amendment to the Restated Certificate of Incorporation of GT Biopharma, Inc., effective as of February 10, 2021   8-K3.1001-40023 
02/11/2021
 
3.5
3.5
 Bylaws, as restated effective September 7, 1994 and as amended through April 29, 2003   10-QSB3000-08092 08/14/2003
4.1
4.1
 Certificate of Designation of Preferences, Rights and Limitations of Series J-1 Preferred Stock of GT Biopharma, Inc., dated April 3, 2019   8-K3.1000-08092 04/05/2019
4.24.2 Certificate of Designation of Preferences, Rights and Limitations of Series K Preferred Stock of GT Biopharma, Inc., dated April 3, 2019   10-K4.2001-40023 04/16/2021
10.1

 Form Securities Purchase Agreement among GT Biopharma, Inc. and the purchaser named therein (executed in April/May 2020)   
10-Q
 
10.4
 
000-08092
 
 
05/15/20
 
10.1
 Amended and Restated Employment Agreement with Anthony Cataldo, dated April 23, 2021 X     
10.2
10.2
 Amended and Restated Employment Agreement with Michael Handelman, dated April 23, 2021 X     
10.3
10.3
 Amended and Restated Employment Agreement with Dr. Gregory Berk, dated April 23, 2021 X     
31.131.1 Certification of Principal Executive Officer and Principal Financial Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended. X      
32.1*
32.1*
 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer and Chief Financial Officer). X      
101.INS101.INS Inline XBRL Instance Document. X      
101.SCH101.SCH Inline XBRL Taxonomy Extension Schema Document. X      
101.CAL101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document. X      
101.DEF101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document. X      
101.LAB101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document. X      
101.PRE101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document. X      
 
 
  


            
10.2
 Form of Registration Rights Agreement among GT Biopharma, Inc. and the purchaser named therein (executed in April/May 2020)   
10-Q
 
10.5
 
000-08092
 
 
05/15/20
 
          
10.3
 Form of Convertible Note (related to Securities Purchase Agreement executed in April/May 2020)   10-Q10.6000-08092 05/15/20
 
 
      
10.4
 Securities Purchase Agreement, dated July 7, 2020, among GT Biopharma, Inc. and the purchaser named therein   
8-K
 
10.1
 
000-08092
��
 
07/09/20
 
 
 
      
10.5
 Registration Rights Agreement, dated July 7, 2020, among GT Biopharma, Inc. and the purchaser named therein   
8-K
 
10.3
 
000-08092
 
 
07/09/20
 
          
10.6
 Form of Convertible Note (related to Securities Purchase Agreement, dated July 7, 2020)   8-K4.1000-08092 07/09/20
          
10.7
 Form of Standstill and Forbearance Agreement, dated June 23, 2020, between the Company and certain holders of Convertible Notes   
8-K
 
10.1
 
000-08092
 
 
06/23/20
 
 
 
      
10.8
 Settlement Agreement, dated June 19, 2020, among GT Biopharma, Inc., Empery Asset Master Ltd., Empery Tax Efficient, LP and Empery Tax Efficient II, LP, Anthony Cataldo and Paul Kessler   
8-K
 
10.1
 
000-08092
 
 
06/19/20
 
          
10.9
 Form of Convertible Note, dated June 19, 2020 (related to Settlement Agreement, dated June 19, 2020)   8-K10.2000-08092 06/19/20
          
10.10
 Form of Pre-Funded Warrant to Purchase Common Stock, dated June 19, 2020 (related to Settlement Agreement, dated June 19, 2020)   
8-K
 
10.3
 
000-08092
 
 
06/19/20
 
          
10.11
 Employment agreement with Anthony Cataldo X      
          
10.12
 Employment agreement with Steven Weldon X      
          
31.1
 Certification of Principal Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended. 
X
 
      
          
31.2
 Certification of Principal Financial Officer pursuant to Rule 13a-14 and Rule 15d 14(a), promulgated under the Securities and Exchange Act of 1934, as amended. 
X
 
      
          
32.1*
 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer). 
X
 
      





 

   
32.2*
 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Financial Officer). 
X
 
      
          
101.INS Inline XBRL Instance Document. X      
          
101.SCH Inline XBRL Taxonomy Extension Schema Document. X      
          
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document. X      
          
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document. X      
          
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document. X      
          
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document. X      
*
This certification shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that Section, nor shall it be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act.
 
*
This certification shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that Section, nor shall it be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act.

 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
Dated: August 17, 2020
GT Biopharma, Inc.
Dated: May 17, 2021By:  /s//s/ Anthony Cataldo 
Anthony Cataldo
Chief Executive Officer, Chief Financial Officer and Chairman of the Board
  
 Dated: August 17, 2020
 By: /s/ Steven Weldon                                         
Steven Weldon
Chief Financial Officer
 
 
 
 
 
24