| Delaware (State or other jurisdiction of incorporation or organization) | | | 2834 (Primary Standard Industrial Classification Code Number) | | | 85-0870387 (I.R.S. Employer Identification No.) | |
| Copies to: | | |||
| Steven M. Skolnick, Esq. Lowenstein Sandler LLP 1251 Avenue of the Americas New York, New York 10020 Telephone: (212) 262-6700 | | | Richard I., Anslow, Esq. Lawrence Rosenbloom, Esq. Ellenoff Grossman & Schole LLP 1345 Avenue of the Americas New York, New York 10105 Telephone: (212) 370-1300 | |
| Large accelerated filer ☐ | | | Accelerated filer ☐ | |
| Non-accelerated filer ☒ | | | Smaller reporting company ☒ | |
| | | | Emerging growth company ☒ | |
| | |||||||||
Title of Each Class of Securities to be Registered | | | Proposed Maximum Aggregate Offering Price(1) | | | Amount of Registration Fee | | |||
Common Stock, $0.0001 par value per share(2) | | | $17,250,000 | | | | $ | 2,239.05 | | |
Underwriter’s warrant(3) | | | — | | | | | | | |
Common Stock underlying underwriter’s warrant(4) | | | $1,207,500 | | | | $ | 156.73 | | |
Total | | | $18,457,500 | | | | $ | 2,395.78(5) | | |
| | | Per Share | | | Total | | ||||||
Initial public offering price | | | | $ | | | | | $ | | | ||
Underwriting discounts and commissions(1) | | | | $ | | | | | $ | | | ||
Proceeds, before expenses, to us | | | | $ | | | | | $ | | |
| The Benchmark Company | | | Brookline Capital Markets, a division of Arcadia Securities, LLC | |
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| | | | F-1 | | |
| | | For the Six Months Ended June 30, 2020 | | | For the Six Months Ended June 30, 2019 | | | For the Year Ended December 31, 2019 | | | For the Period from April 5, 2018 (Inception) through December 31, 2018 | | ||||||||||||
Statements of Operations Data | | | | | | | | | | | | | | | | | | | | | | | | | |
General and adminsitrative expense | | | | $ | 1,532,217 | | | | | $ | 36,915 | | | | | $ | 114,496 | | | | | $ | 12,342 | | |
Stock-based compensation | | | | | 955,344 | | | | | | — | | | | | | — | | | | | | — | | |
Research and development expense | | | | | 269,947 | | | | | | 215,357 | | | | | | 484,113 | | | | | | 204,161 | | |
Research and development expense – license acquired | | | | | — | | | | | | — | | | | | | — | | | | | | 5,776 | | |
Net loss | | | | $ | (1,802,164) | | | | | $ | (252,272) | | | | | $ | 598,609 | | | | | $ | 222,279 | | |
|
| | | 6/30/2020 | | | 6/20/2019 | | | 12/31/2019 | | | 12/31/2018 | | ||||||||||||
Balance Sheet Data | | | | | | ||||||||||||||||||||
Cash | | | | $ | 26,865 | | | | | $ | 40,459 | | | | | $ | 24,947 | | | | | $ | 9,322 | | |
Total assets | | | | | 26,865 | | | | | | 40,459 | | | | | | 24,947 | | | | | | 9,322 | | |
Working capital (deficit) | | | | | (374,365) | | | | | | 6,742 | | | | | | (98,301) | | | | | | 2,721 | | |
Temporary equity(1) | | | | | 2,808,148 | | | | | | 501,193 | | | | | | — | | | | | | 232,096 | | |
Accumulated deficit | | | | | (2,685,434) | | | | | | (494,451) | | | | | | (863,828) | | | | | | (229,375) | | |
Total members’ deficit | | | | | (3,182,513) | | | | | | (494,451) | | | | | | (863,828) | | | | | | (229,375) | | |
| | | As of | | |||||||||||||||
| | | Actual | | | Pro Forma | | | Pro Forma as Adjusted | | |||||||||
| | | (unaudited) | | |||||||||||||||
| | | (in thousands, except share and per share data) | | |||||||||||||||
Cash | | | | $ | 27 | | | | | $ | 127 | | | | | $ | 13,102 | | |
Preferred shares, 2,696,439 issued and outstanding at June 30, 2020; aggregate liquidation preferences of $2,808,148 as of June 30, 2020 (pro forma and pro forma adjusted) | | | | | 2,808 | | | | | | — | | | | | | — | | |
Stockholders’ equity (deficit): | | | | | | | | | | | | | | | | | | | |
Common units, 5,775,898 shares issued and outstanding (actual); 7,355,555 shares issued and outstanding (pro forma); 9,855,555 issued and outstanding (pro forma as adjusted) | | | | | | | | | | | | | | | | | | | |
Additional paid in capital | | | | | (497) | | | | | | 2,411 | | | | | | 15,386 | | |
Accumulated deficit | | | | | (2,685) | | | | | | (2,686) | | | | | | (2,686) | | |
Total stockholders’ equity (deficit) | | | | | (3,182) | | | | | | (275) | | | | | | 12,700 | | |
Total capitalization | | | | $ | (3,182) | | | | | $ | (275) | | | | | $ | 12,700 | | |
| Assumed initial public offering price per share | | | | $ | 6.00 | | |
| Historical net tangible book value per share as of June 30, 2020 | | | | $ | (0.55) | | |
| Pro forma increase in net tangible book value per share attributable to the conversion of preferred stock and the conversion of the 2020 Notes | | | | $ | 0.51 | | |
| Pro forma net tangible book value per share as of June 30, 2020 | | | | $ | (0.04) | | |
| Pro forma increase in net tangible book value per share attributable to new investors | | | | $ | 1.33 | | |
| Pro forma as adjusted net tangible book value per share after this offering | | | | $ | 1.29 | | |
| Dilution per share to new investors participating in this offering | | | | $ | 4.71 | | |
| | | Shares Purchased | | | Total Consideration | | | Average Price Per Share | | |||||||||||||||||||||
| | | Number | | | Percent | | | Amount | | | Percent | | ||||||||||||||||||
Existing stockholders | | | | | 7,355,555 | | | | | | 74.6% | | | | | $ | 878,718 | | | | | | 5.8% | | | | | $ | 0.12 | | |
Investors participating in this offering | | | | | 2,500,000 | | | | | | 25.4% | | | | | $ | 15,000,000 | | | | | | 94.2% | | | | | $ | 6.00 | | |
Total | | | | | 9,855,555 | | | | | | 100% | | | | | $ | 15,878,718 | | | | | | 100% | | | | | $ | 1.61 | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2020 | | | 2019 | | ||||||
Operating expenses | | | | | | | | | | | | | |
General and administrative | | | | $ | 1,532,218 | | | | | $ | 36,915 | | |
Research and development | | | | | 269,947 | | | | | | 215,357 | | |
Total operating expenses | | | | | 1,802,165 | | | | | | 252,272 | | |
Loss from operations | | | | | (1,802,165) | | | | | | (252,272) | | |
Net loss | | | | $ | (1,802,165) | | | | | $ | (252,272) | | |
| | | For the Year Ended December 31, 2019 | | | For the Period from April 5, 2018 (Inception) through December 31, 2018 | | ||||||
Operating expenses | | | | | | | | | | | | | |
General and administrative | | | | | 114,496 | | | | | | 12,342 | | |
Research and development | | | | | 484,113 | | | | | | 204,161 | | |
Research and development – license acquired | | | | | — | | | | | | 5,776 | | |
Total operating expenses | | | | | 598,609 | | | | | | 222,279 | | |
Loss from operations | | | | | (598,609) | | | | | | (222,279) | | |
Net loss | | | | $ | (598,609) | | | | | $ | (222,279) | | |
Weighted average number of common shares outstanding, basic and diluted | | | | | 5,775,898 | | | | | | 5,775,898 | | |
Net loss per share, basic and diluted | | | | $ | (0.10) | | | | | $ | (0.04) | | |
|
Outcome | | | Suramin | | | Placebo | | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Instruments | | | Factor or behaviour | | | Time after Treatement (days) | | | Difference from baseline (mean ± SD) | | | 95% CI | | | d(1) | | | N | | | P(2) | | | p(3) | | | Difference from baseline (mean ± SD) | | | 95% CI | | | d(1) | | | N | | | P(2) | | | p(3) | | |||||||||||||||||||||||||||
Primary outcomes | | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ADOS-2 | | | Comparision | | | | | 45 | | | | -1.6 ± 0.55 | | | -2.3 to -0.9 | | | | | 2.9 | | | | | | 5 | | | | | | 0.0028 | | | | | | 0.038 | | | | -0.4 ± 0.55 | | | -1.1 to + 0.28 | | | | | 0.7 | | | | | | 5 | | | | | | 0.18 | | | | | | 0.16 | | |
| | | Raw | | | | | 45 | | | | -4.6 ± 1.9 | | | -7.0. to -2.2 | | | | | 2.4 | | | | | | 5 | | | | | | 0.0062 | | | | | | 0.039 | | | | -0.4 ± 1.8 | | | -2.7 to +1.9 | | | | | 0.22 | | | | | | 5 | | | | | | 0.65 | | | | | | 0.58 | | |
| | | Social | | | | | 45 | | | | -3.2 ± 1.9 | | | -5.6 to -0.8 | | | | | 1.7 | | | | | | 5 | | | | | | 0.020 | | | | | | 0.043 | | | | 0.0 ± 1.7 | | | -2.2 to +2.2 | | | | | 0 | | | | | | 5 | | | | | | 0.99 | | | | | | 0.71 | | |
| | | Rest/Rep | | | | | 45 | | | | -1.4 ± 0.89 | | | -2.5 to -0.29 | | | | | 1.6 | | | | | | 5 | | | | | | 0.025 | | | | | | 0.059 | | | | -0.4 ± 2.1 | | | -3.0 to +2.2 | | | | | 0.19 | | | | | | 5 | | | | | | 0.69 | | | | | | 0.58 | | |
EOWPVT | | | Vocabulary | | | | | 45 | | | | -4.2 ± -8.3 | | | -14.50 to +6.1 | | | | | -0.51 | | | | | | 5 | | | | | | 0.32 | | | | | | 0.50 | | | | +2.0 ± 4.6 | | | -3.8 to +7.8 | | | | | 0.43 | | | | | | 5 | | | | | | 0.39 | | | | | | 0.50 | | |
Secondary Outcomes | | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ABC | | | Stereotypy | | | | | 7 | | | | -3.6 ± 2.1 | | | -6.2 to -1.0 | | | | | 1.7 | | | | | | 5 | | | | | | 0.018 | | | | | | 0.043 | | | | +0.4 ± 1.9 | | | -2.0 to +2.8 | | | | | -0.21 | | | | | | 5 | | | | | | 0.67 | | | | | | 0.68 | | |
| | | Stereotypy | | | | | 45 | | | | -4.0 ± 2.3 | | | -6.9 to -1.1 | | | | | 1.7 | | | | | | 5 | | | | | | 0.019 | | | | | | 0.042 | | | | +1.0 ± 4.3 | | | 4.3 to +6.3 | | | | | -0.23 | | | | | | 5 | | | | | | 0.63 | | | | | | 0.69 | | |
ATEC | �� | | Total | | | | | 7 | | | | -10 ± 7.7 | | | -20 to -0.46 | | | | | 1.3 | | | | | | 5 | | | | | | 0.044 | | | | | | 0.043 | | | | +7.2 ± 14 | | | -10 to +25 | | | | | -0.51 | | | | | | 5 | | | | | | 0.32 | | | | | | 0.35 | | |
| | | Language | | | | | 7 | | | | -2.2 ± 1.5 | | | -4.0 to -0.36 | | | | | 1.4 | | | | | | 5 | | | | | | 0.021 | | | | | | 0.059 | | | | 0.0 ± 4.1 | | | -5.0 to +5.0 | | | | | 0 | | | | | | 5 | | | | | | 0.99 | | | | | | 0.89 | | |
| | | Sociability | | | | | 7 | | | | -3.6 ± 2.6 | | | -6.8 to -0.36 | | | | | 1.4 | | | | | | 5 | | | | | | 0.025 | | | | | | 0.063 | | | | -0.8 ± 2.8 | | | 4.3 to +2.6 | | | | | 0.29 | | | | | | 5 | | | | | | 0.55 | | | | | | 0.58 | | |
| | | Language | | | | | 45 | | | | -2.0 ± 1.4 | | | -2.7 to -0.49 | | | | | 1.4 | | | | | | 5 | | | | | | 0.034 | | | | | | 0.059 | | | | -0.2 ± 2.9 | | | -3.8 to +3.4 | | | | | 0.07 | | | | | | 5 | | | | | | 0.88 | | | | | | 0.79 | | |
CGI | | | Overall ASD | | | | | 45 | | | | -1.8 ± 1.04 | | | -3.4 to -0.15 | | | | | 1.7 | | | | | | 5 | | | | | | 0.05 | | | | | | n/a | | | | 0.0 ± 0.34 | | | -0.55 to +0.55 | | | | | 0 | | | | | | 5 | | | | | | 0.99 | | | | | | n/a | | |
| | | E. Language | | | | | 45 | | | | -2.0 ± 1.04 | | | -3.6 to -0.35 | | | | | 1.9 | | | | | | 5 | | | | | | 0.01 | | | | | | n/a | | | | 0.0 ± 0.34 | | | -0.55 to +0.55 | | | | | 0 | | | | | | 5 | | | | | | 0.99 | | | | | | n/a | | |
| | | Social Inter. | | | | | 45 | | | | -2.0 ± 1.04 | | | -3.6 to -0.35 | | | | | 1.9 | | | | | | 5 | | | | | | 0.01 | | | | | | n/a | | | | 0.0 ± 0.34 | | | -0.55 to +0.55 | | | | | 0 | | | | | | 5 | | | | | | 0.99 | | | | | | n/a | | |
RBQ | | | Total | | | | | 45 | | | | -3.2 ± 5.8 | | | -10.4 to +4.0 | | | | | 0.55 | | | | | | 5 | | | | | | 0.28 | | | | | | 0.22 | | | | -0.8 ± 3.3 | | | -4.9 to 3.3 | | | | | 0.24 | | | | | | 5 | | | | | | 0.62 | | | | | | 0.47 | | |
Name | | | Age | | | Position(s) | |
Howard J. Weisman | | | 61 | | | Chief Executive Officer and Class III Director | |
Joseph Lucchese | | | 54 | | | Chief Financial Officer | |
Michael Derby | | | 47 | | | Executive Chairman of the Board and Class II Director | |
Zachary Rome | | | 36 | | | Chief Operating Officer and Class I Director | |
David Hough, MD | | | 63 | | | Chief Medical Officer | |
Karen Dawes | | | 69 | | | Class III Director | |
Karen LaRochelle | | | 53 | | | Class II Director | |
Paul K. Wotton, Ph.D. | | | 60 | | | Class III Director | |
Robert Apple | | | 54 | | | Class I Director | |
Name of Beneficial Owner(1) | | | Number of Shares Beneficially Owned(2) | | | Percentage Owned Prior to the Offering | | | Percentage Owned After the Offering(3) | | | |||||||||||
5% Stockholders | | | | | | | | | | | | | | | | | | | | | ||
TardiMed Sciences, LLC(4)(7) | | | | | 7,241,745 | | | | | | 98.8% | | | | | | 73.5% | | | | ||
Directors and Executive Officers | | | | | | | | | | | | | | | | | | | | | ||
Howard J. Weisman(5) | | | | | — | | | | | | — | | | | | | — | | | | ||
Joseph Lucchese(6) | | | | | — | | | | | | — | | | | | | — | | | | ||
Michael Derby(7) | | | | | 7,241,745 | | | | | | 98.8 | | | | | | — | | | | ||
Zachary Rome(8) | | | | | 78,124 | | | | | | * | | | | | | — | | | | ||
David Hough, MD(9) | | | | | — | | | | | | — | | | | | | — | | | | ||
Karen Dawes(10) | | | | | — | | | | | | — | | | | | | — | | | | ||
Karen LaRochelle(11) | | | | | — | | | | | | — | | | | | | — | | | | ||
Paul K. Wotton, Ph.D.(12) | | | | | — | | | | | | — | | | | | | — | | | | ||
Robert Apple(13) | | | | | — | | | | | | — | | | | | | — | | | | ||
Directors and Executive Officers as a group (9 persons) | | | | | 7,314,661 | | | | | | 99.7 | | | | | | 74.2 | | | | | |
Date Available for Sale | | | Shares Eligible for Sale | | | Description | |
Date of Prospectus | | | 2,500,000 | | | Shares sold in the offering that are not subject to a lock-up | |
90 Days after Date of Prospectus | | | — | | | Shares saleable under Rules 144 and 701 that are not subject to a lock-up | |
180 Days after Date of Prospectus | | | 1,022,222 | | | Lock-up released; shares saleable under Rules 144 and 701 | |
Underwriter | | | Number of shares of common stock | | |||
The Benchmark Company, LLC | | | | ||||
Brookline Capital Markets, a division of Arcadia Securities, LLC | | | |||||
Total: | | | | | | |
| | | Per Share of Common Stock | | | Total without Exercise of Over-allotment option | | | Total with Exercise of Over-allotment option | | |||||||||
Public offering price | | | | $ | | | | | $ | | | | | $ | | | |||
Underwriting discount(1) | | | | $ | | | | | $ | | | | | $ | | | |||
Non-accountable expense allowance(2) | | | | $ | | | | | $ | | | | | $ | | | |||
Net proceeds to us | | | | $ | | | | | $ | | | | | $ | | |
| | | Page No. | | |||
Audited Financial Statements | | | |||||
| | | | F-2 | | | |
| | | | F-3 | | | |
| | | | F-4 | | | |
| | | | F-5 | | | |
| | | | F-6 | | | |
| | | | F-7 | | |
| | | Page No. | | |||
Interim Condensed Financial Statements (Unaudited) | | | |||||
| | | | F-14 | | | |
| | | | F-15 | | | |
| | | | F-16 | | | |
| | | | F-17 | | | |
| | | | F-18 | | |
| | | December 31, | | |||||||||
| | | 2019 | | | 2018 | | ||||||
ASSETS | | | | | | | | | | | | | |
Current assets | | | | | | | | | | | | | |
Cash | | | | $ | 24,947 | | | | | $ | 9,322 | | |
Total current assets | | | | | 24,947 | | | | | | 9,322 | | |
Total assets | | | | $ | 24,947 | | | | | $ | 9,322 | | |
LIABILITIES, TEMPORARY EQUITY AND MEMBERS’ DEFICIT | | | | | | | | | | | | | |
Current liabilities | | | | | | | | | | | | | |
Accounts payable | | | | $ | 41,023 | | | | | $ | — | | |
Accounts payable – related party | | | | | 15,325 | | | | | | 2,454 | | |
Accrued expenses | | | | | 66,900 | | | | | | 4,147 | | |
Total current liabilities | | | | | 123,248 | | | | | | 6,601 | | |
Total liabilities | | | | | 123,248 | | | | | | 6,601 | | |
Temporary equity | | | | ||||||||||
Preferred units, 1,445,173 and 450,000 shares issued and outstanding at December 31, 2019 and 2018; liquidation preference of $765,527 and $232,096 and of December 31, 2019 and 2018, respectively | | | | | 765,527 | | | | | | 232,096 | | |
Commitments and contingencies (Note 7) | | | | | | | | | | | | | |
Members’ deficit | | | | | | | | | | | | | |
Accumulated deficit | | | | | (863,828) | | | | | | (229,375) | | |
Total members’ deficit | | | | | (863,828) | | | | | | (229,375) | | |
Total liabilities, temporary equity and members’ deficit | | | | $ | 24,947 | | | | | $ | 9,322 | | |
| | | For the Year Ended December 31, 2019 | | | For the Period from April 5, 2018 (Inception) through December 31, 2018 | | ||||||
Operating expenses | | | | | | | | | | | | | |
General and administrative | | | | $ | 114,496 | | | | | $ | 12,342 | | |
Research and development | | | | | 484,113 | | | | | | 204,161 | | |
Research and development – license acquired | | | | | — | | | | | | 5,776 | | |
Total operating expenses | | | | | 598,609 | | | | | | 222,279 | | |
Loss from operations | | | | | (598,609) | | | | | | (222,279) | | |
Net loss | | | | $ | (598,609) | | | | | $ | (222,279) | | |
Proforma weighted average number of common shares outstanding, basic and diluted | | | | | 5,775,898 | | | | | | 5,775,898 | | |
Proforma net loss per share, basic and diluted | | | | $ | (0.10) | | | | | $ | (0.04) | | |
| | | Common Stock | | | Accumulated Deficit | | | Total Members' Deficit | | |||||||||||||||
| | | Units | | | Amount | | ||||||||||||||||||
Balance at April 5, 2018 (Inception) | | | | | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Contribution from TardiMed | | | | | 5,775,898 | | | | | | — | | | | | | — | | | | | | | | |
Accrued preferred unit dividend | | | | | — | | | | | | — | | | | | | (7,096) | | | | | | (7,096) | | |
Net loss | | | | | — | | | | | | — | | | | | | (222,279) | | | | | | (222,279) | | |
Balance at December 31, 2018 | | | | | 5,775,898 | | | | | $ | — | | | | | $ | (229,375) | | | | | $ | (229,375) | | |
Accrued preferred unit dividend | | | | | — | | | | | | — | | | | | | (35,844) | | | | | | (35,844) | | |
Net loss | | | | | — | | | | | | — | | | | | | (598,609) | | | | | | (598,609) | | |
Balance at December 31, 2019 | | | | | 5,775,898 | | | | | $ | — | | | | | $ | (863,828) | | | | | $ | (863,828) | | |
| | | For the Year Ended December 31, 2019 | | | For the Period from April 5, 2018 (Inception) through December 31, 2018 | | ||||||
Cash flows from operating activities | | | | | | | | | | | | | |
Net loss | | | | $ | (598,609) | | | | | $ | (222,279) | | |
Adjustments to reconcile net loss to net cash used in operating activities: | | | | | | | | | | | | | |
Research and development-licenses acquired, expense | | | | | — | | | | | | 5,776 | | |
Non-cash contribution from TardiMed | | | | | 62,587 | | | | | | — | | |
Changes in assets and liabilities: | | | | | | | | | | | | | |
Accounts payable | | | | | 41,023 | | | | | | — | | |
Accounts payable – related party | | | | | 12,871 | | | | | | 2,454 | | |
Accrued expenses | | | | | 62,753 | | | | | | 4,147 | | |
Net cash used in operating activities | | | | | (419,375) | | | | | | (209,902) | | |
Cash flows from investing activities | | | | | | | | | | | | | |
Purchase of research and development licenses | | | | | — | | | | | | (5,776) | | |
Net cash used in investing activities | | | | | — | | | | | | (5,776) | | |
Cash flows from financing activities | | | | | | | | | | | | | |
Contribution from TardiMed | | | | | 435,000 | | | | | | 200,000 | | |
Contribution from a third-party | | | | | — | | | | | | 25,000 | | |
Net cash provided by financing activities | | | | | 435,000 | | | | | | 225,000 | | |
Net increase in cash | | | | | 15,625 | | | | | | 9,322 | | |
Cash, beginning of period | | | | | 9,322 | | | | | | — | | |
Cash, end of period | | | | $ | 24,947 | | | | | $ | 9,322 | | |
Non cash financing activities: | | | | | | | | | | | | | |
Accrued preferred unit dividend | | | | $ | 35,844 | | | | | $ | 7,096 | | |
| | | As of December 31, | | |||||||||
| | | 2019 | | | 2018 | | ||||||
Accrued expenses: | | | | | | | | | | | | | |
Research and development | | | | $ | 66,900 | | | | | $ | 4,147 | | |
Total accrued expenses | | | | $ | 66,900 | | | | | $ | 4,147 | | |
| | | Preferred Units | | |||||||||
| | | Shares | | | Amount | | ||||||
Balance at April 5, 2018 (Inception) | | | | | — | | | | | $ | — | | |
Contribution from TardiMed | | | | | 400,000 | | | | | | 200,000 | | |
Contribution from a third-party | | | | | 50,000 | | | | | | 25,000 | | |
Accrued preferred unit dividend | | | | | — | | | | | | 7,096 | | |
Balance at December 31, 2018 | | | | | 450,000 | | | | | $ | 232,096 | | |
Contribution from TardiMed | | | | | 870,000 | | | | | | 435,000 | | |
Non-cash contribution from TardiMed | | | | | 125,173 | | | | | | 62,587 | | |
Accrued preferred unit dividend | | | | | — | | | | | | 35,844 | | |
Balance at December 31, 2019 | | | | | 1,445,173 | | | | | $ | 765,527 | | |
| | | Year Ended December 31, | | |||||||||
| | | 2019 | | | 2018 | | ||||||
Net Loss | | | | $ | (598,609) | | | | | $ | (222,279) | | |
Cumulative Dividends | | | | | (35,844) | | | | | | (7,096) | | |
Net Loss applicable to common unit holder | | | | $ | (634,453) | | | | | $ | (229,375) | | |
Weighted average number of common shares outstanding, basic and diluted | | | | | 5,775,898 | | | | | | 5,775,898 | | |
Pro forma net loss per share, basic and diluted | | | | $ | (0.10) | | | | | $ | (0.04) | | |
Pro forma net loss applicable to common unit holder per share, basic and diluted | | | | $ | (0.11) | | | | | $ | (0.04) | | |
| | | June 30, 2020 | | | December 31, 2019 | | ||||||
| | | (Unaudited) | | | | | | | | |||
ASSETS | | | | | | | | | | | | | |
Current assets | | | | | | | | | | | | | |
Cash | | | | $ | 26,865 | | | | | $ | 24,947 | | |
Total assets | | | | $ | 26,865 | | | | | $ | 24,947 | | |
LIABILITIES, TEMPORARY EQUITY, AND MEMBERS’ AND STOCKHOLDERS’ DEFICIT | | | | | | | | | | | | | |
Current liabilities | | | | | | | | | | | | | |
Accounts payable | | | | $ | 304,412 | | | | | $ | 41,023 | | |
Accounts payable – related party | | | | | 7,988 | | | | | | 15,325 | | |
Accrued expenses | | | | | 88,830 | | | | | | 66,900 | | |
Total current liabilities | | | | | 401,230 | | | | | | 123,248 | | |
Total liabilities | | | | | 401,230 | | | | | | 123,248 | | |
Temporary equity | | | | | | | | | | | | | |
Preferred units, 1,516,141 shares issued and outstanding at December 31, 2019; aggregate liquidation preference of $765,527 as of December 31, 2019 | | | | | — | | | | | | 765,527 | | |
Preferred shares, par value $.0001; 2,696,439 shares authorized; 2,696,439 shares issued and outstanding at June 30, 2020; aggregate liquidation preference of $2,808,148 | | | | | 2,808,148 | | | | | | — | | |
Commitments and contingencies (Note 7) | | | | | | | | | | | | | |
Members’ and stockholders deficit | | | | | | | | | | | | | |
Common stock – member units | | | | | — | | | | | | — | | |
Common stock, par value $.0001; 20,000,000 shares authorized at June 30, 2020; 5,775,898 shares issued and outstanding at June 30, 2020 | | | | | — | | | | | | — | | |
Additional paid-in capital | | | | | (497,079) | | | | | | — | | |
Accumulated deficit | | | | | (2,685,434) | | | | | | (863,828) | | |
Total members’ and stockholders’ deficit | | | | | (3,182,513) | | | | | | (863,828) | | |
Total liabilities, temporary equity, and members’ and stockholders’ deficit | | | | $ | 26,865 | | | | | $ | 24,947 | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2020 | | | 2019 | | ||||||
Operating expenses | | | | | | | | | | | | | |
General and administrative | | | | $ | 1,532,217 | | | | | $ | 36,915 | | |
Research and development | | | | | 269,947 | | | | | | 215,357 | | |
Total operating expenses | | | | | 1,802,164 | | | | | | 252,272 | | |
Loss from operations | | | | | (1,802,164) | | | | | | (252,272) | | |
Net loss | | | | $ | (1,802,164) | | | | | $ | (252,272) | | |
Less: Accrued preferred unit and stock dividend | | | | | (19,442) | | | | | | (12,804) | | |
Less: Deemed dividend – beneficial conversion feature on preferred stock | | | | | (1,452,422) | | | | | | — | | |
Net loss attributable to common stockholders | | | | $ | (3,274,028) | | | | | $ | (265,076) | | |
Weighted average number of common shares outstanding, basic and diluted | | | | | 5,775,898 | | | | | | 5,775,898 | | |
Net loss per share, basic and diluted | | | | $ | (0.31) | | | | | $ | (0.04) | | |
| | | Common Units | | | Common Stock | | | Additional Paid-in Capital | | | Accumulated Deficit | | | Total Members’ and Stockholders’ Deficit | | |||||||||||||||||||||||||||
| | | Units | | | Amount | | | Shares | | | Amount | | ||||||||||||||||||||||||||||||
Balance at January 1, 2020 | | | | | 5,775,898 | | | | | $ | — | | | | | | — | | | | | $ | — | | | | | $ | — | | | | | $ | (863,828) | | | | | $ | (863,828) | | |
Conversion of common units to common stock | | | | | (5,775,898) | | | | | | — | | | | | | 5,775,898 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Stock-based compensation | | | | | — | | | | | | — | | | | | | — | | | | | | | | | | | | 955,344 | | | | | | — | | | | | | 955,344 | | |
Accrued preferred unit and stock dividend | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (19,442) | | | | | | (19,442) | | |
Net loss | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,802,164) | | | | | | (1,802,164) | | |
Deemed dividend – beneficial conversion feature on preferred stock | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,452,423) | | | | | | — | | | | | | (1,452,423) | | |
Balance at June 30, 2020 | | | | | — | | | | | $ | — | | | | | | 5,775,898 | | | | | $ | — | | | | | $ | (497,079) | | | | | $ | (2,685,434) | | | | | $ | (3,182,513) | | |
|
| | | Common Stock | | | Accumulated Deficit | | | Total Members’ and Stockholders’ Deficit | | |||||||||||||||
| | | Units | | | Amount | | ||||||||||||||||||
Balance at January 1, 2019 | | | | | 5,775,898 | | | | | $ | — | | | | | $ | (229,375) | | | | | $ | (229,375) | | |
Accrued preferred unit dividend | | | | | — | | | | | | — | | | | | | (12,804) | | | | | | (12,804) | | |
Net loss | | | | | — | | | | | | — | | | | | | (252,272) | | | | | | (252,272) | | |
Balance at June 30, 2019 | | | | | 5,775,898 | | | | | $ | — | | | | | $ | (494,451) | | | | | $ | (494,451) | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2020 | | | 2019 | | ||||||
Cash flows from operating activities | | | | | | | | | | | | | |
Net loss | | | | $ | (1,802,164) | | | | | $ | (252,272) | | |
Adjustments to reconcile net loss to net cash used in operating activities: | | | | | | | | | | | | | |
Stock-based compensation | | | | | 955,344 | | | | | | — | | |
Non-cash contribution from TardiMed | | | | | 50,757 | | | | | | 31,293 | | |
Changes in assets and liabilities: | | | | | | | | | | | | | |
Accounts payable | | | | | 263,388 | | | | | | 30,218 | | |
Accounts payable – related party | | | | | (7,337) | | | | | | 1,045 | | |
Accrued expenses | | | | | 21,930 | | | | | | (4,147) | | |
Net cash used in operating activities | | | | | (518,082) | | | | | | (193,863) | | |
Cash flows from financing activities | | | | | | | | | | | | | |
Contribution from TardiMed | | | | | 470,000 | | | | | | 225,000 | | |
Third party investor contributions | | | | | 50,000 | | | | | | — | | |
Net cash provided by financing activities | | | | | 520,000 | | | | | | 225,000 | | |
Net increase in cash | | | | | 1,918 | | | | | | 31,137 | | |
Cash, beginning of period | | | | | 24,947 | | | | | | 9,322 | | |
Cash, end of period | | | | $ | 26,865 | | | | | $ | 40,459 | | |
Non cash financing activities: | | | | | | | | | | | | | |
Deemed dividend – beneficial conversion feature on preferred stock | | | | $ | 1,452,423 | | | | | $ | — | | |
Accrued preferred unit and stock dividend | | | | $ | 19,442 | | | | | $ | 12,804 | | |
| | | June 30, 2020 | | |||
Preferred stock | | | | | 1,557,435 | | |
Stock options | | | | | 787,499 | | |
Total | | | | | 2,344,933 | | |
| | | June 30, 2020 | | | December 31, 2019 | | ||||||
Accrued expenses: | | | | | | | | | | | | | |
Research and development | | | | $ | 9,600 | | | | | $ | 66,900 | | |
Audit fees | | | | | 20,600 | | | | | | — | | |
Employee and related expenses | | | | | 58,630 | | | | | | — | | |
Total accrued expenses | | | | $ | 88,830 | | | | | $ | 66,900 | | |
| | | Six Months Ended June 30, 2020 | | | Year Ended December 31, 2019 | | ||||||||||||||||||
| | | Shares | | | Amount | | | Units | | | Amount | | ||||||||||||
Opening balance | | | | | 1,516,041 | | | | | $ | 765,527 | | | | | | 450,000 | | | | | $ | 232,096 | | |
Contribution from TardiMed | | | | | 940,000 | | | | | | 470,000 | | | | | | 870,000 | | | | | | 435,000 | | |
Investor contributions | | | | | 100,000 | | | | | | 50,000 | | | | | | — | | | | | | — | | |
Non-cash contribution from TardiMed | | | | | 101,514 | | | | | | 50,757 | | | | | | 125,173 | | | | | | 62,587 | | |
Accrued preferred unit dividend | | | | | 38,884 | | | | | | 19,442 | | | | | | — | | | | | | 35,844 | | |
Deemed dividend – beneficial conversion feature on preferred stock | | | | | — | | | | | | 1,452,422 | | | | | | — | | | | | | — | | |
Ending balance | | | | | 2,696,439 | | | | | $ | 2,808,148 | | | | | | 1,445,173 | | | | | $ | 765,527 | | |
| | | Preferred Units | | |||||||||
| | | Units | | | Amount | | ||||||
Balance at January 1, 2019 | | | | | 464,192 | | | | | $ | 232,096 | | |
Contribution from TardiMed | | | | | 450,000 | | | | | | 225,000 | | |
Non-cash contribution from TardiMed | | | | | 62,587 | | | | | | 31,293 | | |
Accrued preferred unit dividend | | | | | 25,609 | | | | | | 12,804 | | |
Balance at June 30, 2019 | | | | | 1,002,388 | | | | | $ | 501,193 | | |
| | | Number of Shares | | | Weighted Average Exercise Price | | | Total Intrinsic Value | | | Weighted Average Remaining Contractual Life (in years) | | ||||||||||||
Outstanding as of December 31, 2019 | | | | | — | | | | | $ | — | | | | | $ | — | | | | | | — | | |
Granted | | | | | 787,499 | | | | | | 0.19 | | | | | $ | 4,236,391 | | | | | | 9.8 | | |
Outstanding as of June 30, 2020 | | | | | 787,499 | | | | | $ | 0.19 | | | | | $ | 4,236,391 | | | | | | 9.8 | | |
Options vested and expected to vest as of June 30, 2020 | | | | | 787,499 | | | | | $ | 0.19 | | | | | $ | 4,236,391 | | | | | | 9.8 | | |
Options vested and exercisable as of June 30, 2020 | | | | | 84,375 | | | | | $ | 0.19 | | | | | $ | 453,898 | | | | | | 9.8 | | |
| The Benchmark Company | | | Brookline Capital Markets, a division of Arcadia Securities, LLC | |
| SEC Filing Fee | | | | $ | 2,395.78 | | |
| FINRA Fee | | | | $ | 3,268.63 | | |
| Underwriter Legal Fees and Expenses. | | | | $ | 100,000.00 | | |
| Nasdaq Fee | | | | $ | 50,000.00 | | |
| Printing Expenses | | | | $ | 85,000.00 | | |
| Accounting Fees and Expenses | | | | $ | 120,000.00 | | |
| Legal Fees and Expenses | | | | $ | 415,000.00 | | |
| Transfer Agent and Registrar Expenses | | | | $ | 24,100.00 | | |
| Miscellaneous | | | | $ | 5,236.00 | | |
| Total | | | | $ | 805,000.00 | | |
| | | | PAXMEDICA, INC. | |
| | | | /s/ Howard J. Weisman Howard J. Weisman | |
| | | | Chief Executive Officer | |
| | | | (Principal Executive Officer) | |
| Signature | | | Title | | | Date | |
| /s/ Howard J. Weisman Howard J. Weisman | | | Chief Executive Officer and Director (Principal Executive Officer) | | | September | |
| /s/ Joseph Lucchese Joseph Lucchese | | | Chief Financial Officer (Principal Financial and Accounting Officer) | | | September | |
| * Zachary Rome | | | Chief Operating Officer and Director | | | September | |
| * David Hough, M.D. | | | Chief Medical Officer | | | September | |
| * Michael Derby | | | Executive Chairman and Director | | | September | |
| * Karen Dawes | | | Director | | | September | |
| * Karen LaRochelle | | | Director | | | September | |
| * Paul Wotton, Ph.D. | | | Director | | | September | |
| * Robert Apple | | | Director | | | September | |
| *By: | | | /s/ Joseph Lucchese Joseph Lucchese, Attorney-In-Fact | |