假 Q3 --12-31 0001321834 http://fasb.org/us-gaap/2024#使用壽命短於租約期限或資產效用成員 600000 0001321834 2024-01-01 2024-09-30 0001321834 2024-11-12 0001321834 2024-09-30 0001321834 2023-12-31 0001321834 us-gaap:相關方成員 2024-09-30 0001321834 us-gaap:相關方成員 2023-12-31 0001321834 MYMD : F系列可轉換優先股成員 2024-09-30 0001321834 MYMD : F系列可轉換優先股成員 2023-12-31 0001321834 MYMD : F系列一號可轉換優先股成員 2024-09-30 0001321834 MYMD : F系列一號可轉換優先股成員 2023-12-31 0001321834 MYMD : G系列可轉換優先股成員 2024-09-30 0001321834 MYMD : G系列可轉換優先股成員 2023-12-31 0001321834 MYMD : D系列可轉換優先股成員 2024-09-30 0001321834 MYMD : D系列可轉換優先股成員 2023-12-31 0001321834 MYMD : F系列可轉換優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : F一系列可轉換優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : G系列可轉換優先股成員 2024-01-01 2024-09-30 0001321834 2024-07-01 2024-09-30 0001321834 2023-07-01 2023-09-30 0001321834 2023-01-01 2023-09-30 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2023-12-31 0001321834 us-gaap:優先股成員 MYMD : F系列可轉換優先股成員 2023-12-31 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2023-12-31 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2023-12-31 0001321834 us-gaap:普通股成員 2023-12-31 0001321834 us-gaap:追加支付資本成員 2023-12-31 0001321834 us-gaap:保留盈餘成員 2023-12-31 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2024-03-31 0001321834 us-gaap:優先股成員 MYMD : F系列可轉換優先股成員 2024-03-31 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2024-03-31 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2024-03-31 0001321834 us-gaap:普通股成員 2024-03-31 0001321834 us-gaap:額外繳入資本成員 2024-03-31 0001321834 us-gaap:保留盈餘成員 2024-03-31 0001321834 2024-03-31 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2024-06-30 0001321834 us-gaap:優先股成員 MYMD : F系列可轉換優先股成員 2024-06-30 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2024-06-30 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2024-06-30 0001321834 us-gaap:普通股成員 2024-06-30 0001321834 us-gaap:已付額外資本成員 2024-06-30 0001321834 us-gaap:保留盈餘成員 2024-06-30 0001321834 2024-06-30 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2022-12-31 0001321834 us-gaap:優先股成員 MYMD : F系列一可轉換優先股成員 2022-12-31 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2022-12-31 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2022-12-31 0001321834 us-gaap:普通股成員 2022-12-31 0001321834 us-gaap:額外繳入資本成員 2022-12-31 0001321834 us-gaap:保留盈餘成員 2022-12-31 0001321834 2022-12-31 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2023-03-31 0001321834 us-gaap:優先股成員 MYMD : F系列可轉換優先股成員 2023-03-31 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2023-03-31 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2023-03-31 0001321834 us-gaap:普通股成員 2023-03-31 0001321834 us-gaap:額外實收資本成員 2023-03-31 0001321834 us-gaap:留存盈餘成員 2023-03-31 0001321834 2023-03-31 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2023-06-30 0001321834 us-gaap:優先股成員 MYMD : F系列可轉換優先股成員 2023-06-30 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2023-06-30 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2023-06-30 0001321834 us-gaap:普通股成員 2023-06-30 0001321834 us-gaap:額外繳入資本成員 2023-06-30 0001321834 us-gaap:保留盈餘成員 2023-06-30 0001321834 2023-06-30 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2024-01-01 2024-03-31 0001321834 us-gaap:優先股成員 MYMD : F系列一可轉換優先股成員 2024-01-01 2024-03-31 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2024-01-01 2024-03-31 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2024-01-01 2024-03-31 0001321834 us-gaap:普通股成員 2024-01-01 2024-03-31 0001321834 us-gaap:額外資本公積成員 2024-01-01 2024-03-31 0001321834 us-gaap:保留盈餘成員 2024-01-01 2024-03-31 0001321834 2024-01-01 2024-03-31 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2024-04-01 2024-06-30 0001321834 us-gaap:優先股成員 MYMD : F系列一可轉換優先股成員 2024-04-01 2024-06-30 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2024-04-01 2024-06-30 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2024-04-01 2024-06-30 0001321834 us-gaap:普通股成員 2024-04-01 2024-06-30 0001321834 us-gaap:額外實收資本成員 2024-04-01 2024-06-30 0001321834 us-gaap:保留盈餘成員 2024-04-01 2024-06-30 0001321834 2024-04-01 2024-06-30 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2024-07-01 2024-09-30 0001321834 us-gaap:優先股成員 MYMD : F系列可轉換優先股成員 2024-07-01 2024-09-30 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2024-07-01 2024-09-30 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2024-07-01 2024-09-30 0001321834 us-gaap:普通股成員 2024-07-01 2024-09-30 0001321834 us-gaap:額外繳入資本成員 2024-07-01 2024-09-30 0001321834 us-gaap:保留盈餘成員 2024-07-01 2024-09-30 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2023-01-01 2023-03-31 0001321834 us-gaap:優先股成員 MYMD : F系列一可轉換優先股成員 2023-01-01 2023-03-31 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2023-01-01 2023-03-31 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2023-01-01 2023-03-31 0001321834 us-gaap:普通股成員 2023-01-01 2023-03-31 0001321834 us-gaap:額外支付資本成員 2023-01-01 2023-03-31 0001321834 us-gaap:保留盈餘成員 2023-01-01 2023-03-31 0001321834 2023-01-01 2023-03-31 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2023-04-01 2023-06-30 0001321834 us-gaap:優先股成員 MYMD : F系列可轉換優先股成員 2023-04-01 2023-06-30 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2023-04-01 2023-06-30 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2023-04-01 2023-06-30 0001321834 us-gaap:普通股成員 2023-04-01 2023-06-30 0001321834 us-gaap:額外實收資本成員 2023-04-01 2023-06-30 0001321834 us-gaap:保留盈餘成員 2023-04-01 2023-06-30 0001321834 2023-04-01 2023-06-30 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2023-07-01 2023-09-30 0001321834 us-gaap:優先股成員 MYMD : F系列一可轉換優先股成員 2023-07-01 2023-09-30 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2023-07-01 2023-09-30 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2023-07-01 2023-09-30 0001321834 us-gaap:普通股成員 2023-07-01 2023-09-30 0001321834 us-gaap:額外實收資本成員 2023-07-01 2023-09-30 0001321834 us-gaap:保留盈餘成員 2023-07-01 2023-09-30 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2024-09-30 0001321834 us-gaap:優先股成員 MYMD : F系列可轉換優先股成員 2024-09-30 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2024-09-30 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2024-09-30 0001321834 us-gaap:普通股成員 2024-09-30 0001321834 us-gaap:額外繳資資本成員 2024-09-30 0001321834 us-gaap:保留盈餘成員 2024-09-30 0001321834 MYMD : F系列可轉換優先股成員 us-gaap:優先股成員 2023-09-30 0001321834 us-gaap:優先股成員 MYMD : F系列可轉換優先股成員 2023-09-30 0001321834 us-gaap:優先股成員 MYMD : G系列可轉換優先股成員 2023-09-30 0001321834 us-gaap:優先股成員 MYMD : D系列可轉換優先股成員 2023-09-30 0001321834 us-gaap:普通股成員 2023-09-30 0001321834 us-gaap:額外實收資本成員 2023-09-30 0001321834 us-gaap:保留盈餘成員 2023-09-30 0001321834 2023-09-30 0001321834 MYMD : F系列可轉換優先股成員 2024-01-01 2024-01-01 0001321834 MYMD : F系列可轉換優先股成員 2024-01-01 2024-03-31 0001321834 MYMD : F系列可轉換優先股成員 2024-02-01 2024-02-01 0001321834 MYMD : F系列一可轉換優先股成員 2024-06-30 0001321834 MYMD : G系列可轉換優先股成員 2024-06-30 0001321834 MYMD : F系列可轉換優先股成員 2024-04-01 2024-06-30 0001321834 MYMD : F系列可轉換優先股成員 2024-07-01 2024-09-30 0001321834 2024-02-23 2024-02-23 0001321834 MYMD : F系列可轉換優先股票成員 2023-03-31 0001321834 MYMD : F系列可轉換優先股票成員 2023-07-01 2023-07-01 0001321834 MYMD : F系列可轉換優先股票成員 2023-08-01 2023-08-01 0001321834 MYMD : F系列可轉換優先股票成員 2023-09-01 2023-09-01 0001321834 MYMD : F系列可轉換優先股票成員 2023-10-01 2023-10-01 0001321834 MYMD : F系列可轉換優先股票成員 2023-07-01 2023-09-30 0001321834 2024-07-24 0001321834 2024-03-04 0001321834 2024-02-14 2024-02-14 0001321834 2024-02-13 2024-02-13 0001321834 2024-02-13 0001321834 2024-02-14 0001321834 srt : 最低成員 2024-07-25 0001321834 srt : 最高成員 2024-02-14 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 2023-02-20 2023-02-21 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 2023-02-21 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 us-gaap:系列F優先股成員 2023-02-21 0001321834 MYMD : F系列可轉換優先股成員 2023-02-21 0001321834 MYMD : F系列一號優先股票成員 2024-01-01 2024-09-30 0001321834 MYMD : F系列可轉換優先股票成員 2024-04-05 0001321834 MYMD : F系列可轉換優先股票成員 2024-04-05 2024-04-05 0001321834 MYMD : 證券購買協議成員 MYMD : F系列一號優先股票成員 2024-05-20 0001321834 MYMD : 證券購買協議成員 2024-05-20 0001321834 MYMD : 證券購買協議成員 us-gaap：G系列優先股成員 2024-05-20 0001321834 us-gaap：G系列優先股成員 2024-05-20 0001321834 MYMD : F系列可轉換優先股成員 2023-02-20 2023-02-21 0001321834 us-gaap:測量輸入預期股息率成員 MYMD : F系列可轉換優先股成員 2023-02-20 2023-02-21 0001321834 MYMD : F系列可轉換優先股成員 srt : 最低成員 2023-02-21 0001321834 2023-02-21 0001321834 us-gaap:普通股成員 us-gaap:測量輸入行使價格成員 2023-02-21 0001321834 us-gaap: 測量輸入選項波動性成員 2023-02-21 0001321834 us-gaap:測量輸入價格波動性成員 2023-02-21 0001321834 美元指數：計量輸入到期成員 2023-02-20 2023-02-21 0001321834 us-gaap：測量輸入折扣率會員 2023-02-21 0001321834 us-gaap:測量輸入預期股息率成員 2023-02-21 0001321834 us-gaap:測量輸入失效率成員 2023-02-21 0001321834 us-gaap:測量輸入違約率成員 2023-02-21 0001321834 us-gaap:優先股成員 2023-01-01 2023-03-31 0001321834 us-gaap:優先股票成員 2023-03-31 0001321834 美國通用會計準則：其他營業收入/費用會員 2024-07-01 2024-09-30 0001321834 us-gaap:其他營運收入費用成員 2023-07-01 2023-09-30 0001321834 us-gaap:其他營運收入費用成員 2024-01-01 2024-09-30 0001321834 us-gaap:其他營運收入費用成員 2023-01-01 2023-09-30 0001321834 us-gaap:其他營運收入費用成員 2024-09-30 0001321834 us-gaap:測量輸入預期股息率成員 2024-01-01 2024-09-30 0001321834 MYMD : 測量輸入交易量波動性成員 2024-09-30 0001321834 us-gaap:其他營運收入或支出成員 us-gaap:測量輸入到期成員 2024-01-01 2024-09-30 0001321834 us-gaap:測量輸入預期股息率成員 2024-09-30 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 2023-02-28 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 MYMD : F系列普通股權證成員 2023-02-28 0001321834 MYMD : F系列普通股認股權證成員 2023-01-01 2023-03-31 0001321834 us-gaap:測量輸入預期股息支付成員 MYMD : F系列普通股認股權證成員 2023-03-31 0001321834 us-gaap:權證成員 MYMD : F系列普通股認股權證成員 2023-03-31 0001321834 us-gaap:測量輸入選項波動性成員 MYMD : F系列普通股認股權證成員 2023-03-31 0001321834 us-gaap:無風險利率測量輸入成員 MYMD : F系列普通股認股權證成員 2023-03-31 0001321834 us-gaap:其他經營收入支出成員 MYMD : F系列認股權證成員 2024-01-01 2024-09-30 0001321834 MYMD : F系列認股權證成員 2024-01-01 2024-09-30 0001321834 us-gaap:測量輸入預期股息支付成員 MYMD : F系列認股權證成員 2024-09-30 0001321834 us-gaap:認股權證成員 MYMD : F系列認股權證成員 2024-09-30 0001321834 us-gaap:測量輸入選項波動性成員 MYMD : F系列認股權證成員 2024-09-30 0001321834 us-gaap:測量輸入無風險利率成員 MYMD : F系列認股權證成員 2024-09-30 0001321834 us-gaap:其他營運收入支出成員 MYMD : F系列認股權證成員 2023-07-01 2023-09-30 0001321834 us-gaap:其他營運收入支出成員 MYMD : F系列認股權證成員 2023-01-01 2023-09-30 0001321834 us-gaap：重大揭示成員 MYMD : F系列認股權證成員 2024-05-13 2024-05-14 0001321834 us-gaap: 公允價值測量循環成員 MYMD : F系列認股權證成員 2024-03-30 2024-03-31 0001321834 MYMD : 證券購買協議成員 2024-05-20 2024-05-20 0001321834 MYMD : 證券購買協議成員 MYMD : F系列短期認股權證成員 2024-05-20 0001321834 MYMD : 證券購買協議成員 MYMD : F系列短期權證成員 2024-05-20 2024-05-20 0001321834 MYMD : 證券購買協議成員 MYMD : F系列長期權證成員 2024-05-20 0001321834 MYMD : 證券購買協議成員 MYMD : F系列長期權證成員 2024-05-20 2024-05-20 0001321834 MYMD : F系列優先股成員 2024-09-30 0001321834 MYMD : F系列優先股成員 2024-01-01 2024-09-30 0001321834 us-gaap:衡量輸入預期股息率成員 MYMD : F系列一號優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : F系列一號優先股成員 srt : 最低成員 2024-09-30 0001321834 MYMD : F系列一號優先股成員 2024-07-01 2024-09-30 0001321834 MYMD : F系列一號優先股成員 2023-07-01 2023-09-30 0001321834 MYMD : F系列一號優先股成員 2023-01-01 2023-09-30 0001321834 us-gaap:普通股成員 us-gaap:計量輸入行使價格成員 2024-09-30 0001321834 us-gaap:測量輸入選項波動性成員 MYMD : F系列首選股成員 2024-09-30 0001321834 us-gaap:測量輸入價格波動性成員 MYMD : F系列首選股成員 2024-09-30 0001321834 us-gaap:測量輸入到期成員 MYMD : F系列首選股成員 2024-01-01 2024-09-30 0001321834 us-gaap:測量輸入折現率成員 MYMD : F系列首選股成員 2024-09-30 0001321834 us-gaap:測量輸入預期股息率成員 MYMD : F系列一種優先股成員 2024-09-30 0001321834 us-gaap:測量輸入失效率成員 MYMD : F系列一種優先股成員 2024-09-30 0001321834 us-gaap:測量輸入違約率成員 MYMD : F系列一種優先股成員 2024-09-30 0001321834 MYMD : F系列一種長期認購權證成員 2024-09-30 0001321834 MYMD : F系列一種短期認購權證成員 2024-09-30 0001321834 MYMD : F系列長期認股權證成員 2024-07-25 2024-07-25 0001321834 MYMD : F系列長期認股權證成員 2024-01-01 2024-09-30 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 us-gaap: G系列優先股成員 2024-05-20 2024-05-20 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 us-gaap: G系列優先股成員 2024-05-20 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 us-gaap:系列G優先股成員 2023-02-21 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 MYMD : 系列G短期權證成員 2024-05-20 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 MYMD : G系列短期認股權證成員 2024-05-20 2024-05-20 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 MYMD : G系列長期認股權證成員 2024-05-20 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 us-gaap: G系列優先股票成員 2024-09-30 0001321834 us-gaap: G系列優先股票成員 2024-01-01 2024-09-30 0001321834 us-gaap:衡量輸入預期股息率成員 us-gaap:系列G優先股成員 2024-01-01 2024-09-30 0001321834 us-gaap:系列G優先股成員 srt : 最低成員 2024-09-30 0001321834 us-gaap:系列G優先股成員 2024-07-01 2024-09-30 0001321834 us-gaap:系列G優先股成員 2023-07-01 2023-09-30 0001321834 us-gaap:系列G優先股成員 2023-01-01 2023-09-30 0001321834 MYMD : 系列G可轉換優先股成員 srt : 最低成員 MYMD : 修訂協議成員 2024-06-17 0001321834 MYMD : G系列可轉換優先股成員 srt : 最高成員 MYMD : 修訂協議成員 2024-06-17 0001321834 us-gaap:優先股成員 us-gaap:G系列優先股成員 2024-07-16 2024-07-17 0001321834 MYMD : 反向優先股成員 2024-07-16 2024-07-17 0001321834 2024-07-16 2024-07-17 0001321834 MYMD : G系列權證成員 MYMD : 投資者成員 us-gaap:權證成員 2024-09-30 0001321834 MYMD : G系列短期權證成員 MYMD : 投資者成員 us-gaap:權證成員 2024-09-30 0001321834 MYMD : G系列短期權證成員 2024-07-25 2024-07-25 0001321834 MYMD : G系列短期權證成員 2024-01-01 2024-09-30 0001321834 MYMD : F系列一登記權利協議成員 2024-01-01 2024-09-30 0001321834 MYMD : G系列登記權利協議成員 2024-01-01 2024-09-30 0001321834 MYMD : F系列權證成員 MYMD : Gpn協議成員 2024-01-01 2024-09-30 0001321834 srt : 最大成員 us-gaap:普通股成員 2024-09-30 0001321834 2023-11-13 2023-11-13 0001321834 MYMD : 分離協議成員 2024-06-14 2024-06-14 0001321834 MYMD : 分離協議成員 2024-07-01 2024-09-30 0001321834 MYMD : 分離協議成員 2024-01-01 2024-09-30 0001321834 srt : 董事成員 srt : 最大成員 2023-11-13 2023-11-13 0001321834 srt : 董事成員 srt : 最小成員 2023-11-13 2023-11-13 0001321834 srt : 董事成員 2023-11-13 2023-11-13 0001321834 MYMD : Eagle Uzonwanne 成員 srt : 最大成員 2023-11-13 2023-11-13 0001321834 MYMD : Eagle Uzonwanne 會員 srt : 最低會員 2023-11-13 2023-11-13 0001321834 MYMD : Eagle Uzonwanne 會員 2023-11-13 2023-11-13 0001321834 MYMD : 應付的遞延補償會員 2024-09-30 0001321834 MYMD : 應付的遞延補償會員 2023-12-31 0001321834 us-gaap: 公平價值輸入第1級成員 2024-09-30 0001321834 us-gaap:公允價值輸入第二層成員 2024-09-30 0001321834 us-gaap:公允價值輸入第三層成員 2024-09-30 0001321834 us-gaap:公允價值輸入層級一成員 2023-12-31 0001321834 us-gaap:公允價值輸入層級二成員 2023-12-31 0001321834 us-gaap:公允價值輸入層級三成員 2023-12-31 0001321834 MYMD : 二零二一年巴爾的摩成員 srt : 最小成員 2021-11-15 2021-11-17 0001321834 MYMD : 二零二一年巴爾的摩成員 srt : 最大成員 2021-11-15 2021-11-17 0001321834 MYMD : 二零二一年巴爾的摩成員 2021-11-17 0001321834 MYMD : 兩千二十一年巴爾的摩會員 2022-12-01 0001321834 MYMD : 普拉特街會員 srt : 最低會員 2022-04-01 2022-04-01 0001321834 MYMD : 普拉特街會員 srt : 最高會員 2022-04-01 2022-04-01 0001321834 MYMD : 巴爾的摩會員 srt : 最高會員 2024-05-01 2024-05-01 0001321834 us-gaap: 公允價值計量持續會員 2023-12-31 0001321834 us-gaap:公允價值計量持續成員 2024-01-01 2024-09-30 0001321834 us-gaap:公允價值計量持續成員 2024-09-30 0001321834 us-gaap：不動產、廠房及設備成員 srt : 最小成員 2024-09-30 0001321834 us-gaap:不動產、廠房及設備成員 srt : 最大成員 2024-09-30 0001321834 us-gaap:家具及設備成員 srt : 最小成員 2024-09-30 0001321834 us-gaap:家具及裝置成員 srt : 最大成員 2024-09-30 0001321834 us-gaap:計算機設備成員 srt : 最小成員 2024-09-30 0001321834 us-gaap:電腦設備成員 srt : 最大成員 2024-09-30 0001321834 us-gaap：租賃改良成員 2024-09-30 0001321834 MYMD : 專利及商標成員 srt : 最低成員 2024-09-30 0001321834 MYMD : 專利和商標成員 srt : 最高成員 2024-09-30 0001321834 MYMD : 普拉特街成員 2024-09-30 0001321834 MYMD : 二零二一年巴爾的摩成員 2024-09-30 0001321834 MYMD : 二零二四年巴爾的摩成員 2024-09-30 0001321834 MYMD : 普拉特街成員 2023-12-31 0001321834 MYMD : 二零二一年巴爾的摩成員 2023-12-31 0001321834 MYMD : 普拉特街會員 2024-07-01 2024-09-30 0001321834 MYMD : 二零二一年巴爾的摩會員 2024-07-01 2024-09-30 0001321834 MYMD : 二零二四年巴爾的摩會員 2024-07-01 2024-09-30 0001321834 MYMD : 普拉特街會員 2023-07-01 2023-09-30 0001321834 MYMD : 二零二一年巴爾的摩會員 2023-07-01 2023-09-30 0001321834 MYMD : 普拉特街會員 2024-01-01 2024-09-30 0001321834 MYMD : 二零二一年巴爾的摩會員 2024-01-01 2024-09-30 0001321834 MYMD : 二零二四年巴爾的摩會員 2024-01-01 2024-09-30 0001321834 MYMD : Platt Street 成員 2023-01-01 2023-09-30 0001321834 MYMD : 二零二一年巴爾的摩成員 2023-01-01 2023-09-30 0001321834 us-gaap:StockOptionMember 2024-07-01 2024-09-30 0001321834 us-gaap:股票選擇權成員 2023-07-01 2023-09-30 0001321834 us-gaap:股票選擇權成員 2024-01-01 2024-09-30 0001321834 us-gaap:股票選擇權成員 2023-01-01 2023-09-30 0001321834 MYMD : 未授予限制性股票單位成員 2024-07-01 2024-09-30 0001321834 MYMD : 未授予限制性股票單位成員 2023-07-01 2023-09-30 0001321834 MYMD : 未歸屬限制性股票單位成員 2024-01-01 2024-09-30 0001321834 MYMD : 未歸屬限制性股票單位成員 2023-01-01 2023-09-30 0001321834 MYMD : 購買普通股認股權證成員 2024-07-01 2024-09-30 0001321834 MYMD : 購買普通股認股權證成員 2023-07-01 2023-09-30 0001321834 MYMD : 購買普通股認股權證成員 2024-01-01 2024-09-30 0001321834 MYMD : 購買普通股認股權證成員 2023-01-01 2023-09-30 0001321834 MYMD : C系列可轉換優先認股權證成員 2024-07-01 2024-09-30 0001321834 MYMD : C系列可轉換優先認股權證成員 2023-07-01 2023-09-30 0001321834 MYMD : C系列可轉換優先認股權成員 2024-01-01 2024-09-30 0001321834 MYMD : C系列可轉換優先認股權成員 2023-01-01 2023-09-30 0001321834 MYMD : D系列優先可轉換股票成員 2024-07-01 2024-09-30 0001321834 MYMD : D系列優先可轉換股票成員 2023-07-01 2023-09-30 0001321834 MYMD : D系列優先可轉換股票成員 2024-01-01 2024-09-30 0001321834 MYMD : D系列優先可轉換股票成員 2023-01-01 2023-09-30 0001321834 MYMD : F系列可轉換優先股票成員 2024-07-01 2024-09-30 0001321834 MYMD : F系列可轉換優先股票成員 2023-07-01 2023-09-30 0001321834 MYMD : F系列可轉換優先股會員 2024-01-01 2024-09-30 0001321834 MYMD : F系列可轉換優先股會員 2023-01-01 2023-09-30 0001321834 MYMD : F系列一可轉換優先股會員 2024-07-01 2024-09-30 0001321834 MYMD : F系列一可轉換優先股會員 2023-07-01 2023-09-30 0001321834 MYMD : F系列一可轉換優先股會員 2024-01-01 2024-09-30 0001321834 MYMD : F系列一可轉換優先股會員 2023-01-01 2023-09-30 0001321834 MYMD : G系列可轉換優先股會員 2024-07-01 2024-09-30 0001321834 MYMD : G系列可轉換優先股會員 2023-07-01 2023-09-30 0001321834 MYMD : G系列可轉換優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : G系列可轉換優先股成員 2023-01-01 2023-09-30 0001321834 us-gaap:股票期權成員 2024-07-01 2024-09-30 0001321834 us-gaap:股票期權成員 2023-07-01 2023-09-30 0001321834 us-gaap:股票期權成員 2024-01-01 2024-09-30 0001321834 us-gaap:股票期權成員 2023-01-01 2023-09-30 0001321834 MYMD : 尚未解禁的限制性股票單位成員 2024-07-01 2024-09-30 0001321834 MYMD : 尚未解禁的限制性股票單位成員 2023-07-01 2023-09-30 0001321834 MYMD : 未歸屬限制股票單位成員 2024-01-01 2024-09-30 0001321834 MYMD : 未歸屬限制股票單位成員 2023-01-01 2023-09-30 0001321834 MYMD : 購買普通股的認股權證成員 2024-07-01 2024-09-30 0001321834 MYMD : 購買普通股的認股權證成員 2023-07-01 2023-09-30 0001321834 MYMD : 購買普通股的認股權證成員 2024-01-01 2024-09-30 0001321834 MYMD : 購買普通股的認股權證成員 2023-01-01 2023-09-30 0001321834 MYMD : C系列可轉換優先認股權證成員 2024-07-01 2024-09-30 0001321834 MYMD : C系列可轉換優先認股權證成員 2023-07-01 2023-09-30 0001321834 MYMD : C系列可轉換優先權證成員 2024-01-01 2024-09-30 0001321834 MYMD : C系列可轉換優先權證成員 2023-01-01 2023-09-30 0001321834 MYMD : D系列可轉換優先股成員 2024-07-01 2024-09-30 0001321834 MYMD : D系列可轉換優先股成員 2023-07-01 2023-09-30 0001321834 MYMD : D系列可轉換優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : D系列可轉換優先股成員 2023-01-01 2023-09-30 0001321834 MYMD : F系列可轉換優先股成員 2024-07-01 2024-09-30 0001321834 MYMD : F系列可轉換優先股成員 2023-07-01 2023-09-30 0001321834 MYMD : F系列可轉換優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : F系列可轉換優先股成員 2023-01-01 2023-09-30 0001321834 MYMD : F一系列可轉換優先股成員 2024-07-01 2024-09-30 0001321834 MYMD : F一系列可轉換優先股成員 2023-07-01 2023-09-30 0001321834 MYMD : F一系列可轉換優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : F一系列可轉換優先股成員 2023-01-01 2023-09-30 0001321834 MYMD : G系列可轉換優先股成員 2024-07-01 2024-09-30 0001321834 MYMD : G系列可轉換優先股成員 2023-07-01 2023-09-30 0001321834 MYMD : G系列可轉換優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : G系列可轉換優先股成員 2023-01-01 2023-09-30 0001321834 us-gaap：G系列優先股成員 美元指數：私募成員 2024-09-30 0001321834 MYMD : 2013年股票激勵計劃成員 2014-01-23 0001321834 MYMD : 2013年股票激勵計劃成員 2024-01-01 2024-09-30 0001321834 MYMD : 2016年股票激勵計劃成員 2016-12-31 0001321834 MYMD : 2017年股票激勵計劃成員 2017-08-07 0001321834 MYMD : 2017年股票激勵計劃成員 2024-01-01 2024-09-30 0001321834 MYMD : 2017年股票激勵計劃成員 2024-09-30 0001321834 MYMD : 2018年股票激勵計劃成員 2020-08-27 0001321834 MYMD : 2018年股票激勵計劃成員 2024-01-01 2024-09-30 0001321834 MYMD : 2018年股票激勵計劃成員 2024-09-30 0001321834 MYMD : 2021年股票激勵計劃成員 2021-04-15 0001321834 MYMD : 2021年股票激勵計劃成員 2024-01-01 2024-09-30 0001321834 MYMD : 2021年股票激勵計劃成員 2024-09-30 0001321834 us-gaap:股票選擇權成員 us-gaap:普通股成員 2024-01-01 2024-09-30 0001321834 us-gaap:股票選擇權成員 2023-01-01 2023-12-31 0001321834 us-gaap:員工股票期權成員 2024-07-01 2024-09-30 0001321834 us-gaap:員工股票選擇權成員 2023-07-01 2023-09-30 0001321834 us-gaap:員工股票選擇權成員 2024-01-01 2024-09-30 0001321834 us-gaap:員工股票選擇權成員 2023-01-01 2023-09-30 0001321834 us-gaap:員工股票選擇權成員 2024-09-30 0001321834 us-gaap：限制性股票單位RSU會員 srt : 董事成員 2021-10-13 2021-10-14 0001321834 us-gaap:限制性股票單位RSU成員 us-gaap: 股份基礎福利獎金第一階段會員 2021-10-13 2021-10-14 0001321834 us-gaap:限制性股票單位RSU成員 us-gaap：股份基礎補償獎勵第二期成員 2021-10-13 2021-10-14 0001321834 us-gaap:限制性股票單位RSU成員 US-GAAP：股份報酬獎勵第三期成員 2021-10-13 2021-10-14 0001321834 us-gaap:受限股票單位RSU成員 2024-01-01 2024-09-30 0001321834 us-gaap: 受限制股票成員 2024-09-30 0001321834 2023-01-01 2023-12-31 0001321834 us-gaap:受限股票單位RSU成員 2023-12-31 0001321834 us-gaap:受限股票單位RSU成員 2024-09-30 0001321834 srt : 最小成員 2024-07-24 0001321834 srt : 最大成員 2024-07-24 0001321834 srt : 最小成員 us-gaap:系列G優先股票成員 2024-06-17 0001321834 srt : 最大成員 us-gaap:系列G優先股成員 2024-06-17 0001321834 MYMD : 系列C可轉換優先股成員 2024-09-30 0001321834 MYMD : 系列E Junior Participating 優先股成員 2024-09-30 0001321834 us-gaap:系列F優先股成員 2024-09-30 0001321834 MYMD : 系列F 1 可轉換優先股成員 2024-09-30 0001321834 MYMD : 系列C可轉換優先股成員 2023-12-31 0001321834 us-gaap:系列F優先股成員 2023-12-31 0001321834 MYMD : F系列1類優先股成員 2024-09-30 0001321834 MYMD : F系列1類優先股成員 2023-12-31 0001321834 us-gaap:G系列優先股成員 2024-09-30 0001321834 us-gaap:G系列優先股成員 2023-12-31 0001321834 MYMD : D系列可轉換優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : F系列可轉換優先股成員 srt : 最低成員 2024-09-30 0001321834 MYMD : F系列1類優先股成員 2024-01-01 2024-09-30 0001321834 us-gaap:測量輸入默認率成員 MYMD : F 1系列優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : F 1系列優先股成員 srt : 最低成員 2024-09-30 0001321834 us-gaap:F系列優先股成員 2024-01-01 2024-09-30 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 us-gaap:普通股成員 2023-02-28 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 MYMD : F系列認股權證成員 2023-02-28 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 MYMD : F系列認股權證成員 2023-02-21 0001321834 MYMD : 普通股票認股權證成員 2024-01-01 2024-09-30 0001321834 MYMD : C系列可轉換優先股認股權證成員 2024-01-01 2024-09-30 0001321834 MYMD : 普通股認股權證成員 2023-12-31 0001321834 MYMD : 普通股認股權證成員 2023-01-01 2023-12-31 0001321834 MYMD : 普通股認股權證成員 2024-09-30 0001321834 MYMD : C系列可轉換優先股認股權證成員 2023-12-31 0001321834 MYMD : C系列可轉換優先股認股權證成員 2023-01-01 2023-12-31 0001321834 MYMD : C系列可轉換優先股認股權證成員 2024-09-30 0001321834 MYMD : 證券購買協議成員 MYMD : 投資者成員 MYMD : G系列長期認股權證會員 2024-05-20 2024-05-20 0001321834 MYMD : 四零一K計畫匹配百分之百會員 2024-01-01 2024-09-30 0001321834 MYMD : 四零一K計畫匹配百分之百會員 srt : 最高會員 2024-01-01 2024-09-30 0001321834 MYMD : 四零一K計畫匹配百分之五十會員 2024-01-01 2024-09-30 0001321834 MYMD : 四零一K計畫匹配百分之五十會員 srt : 最高會員 2024-01-01 2024-09-30 0001321834 MYMD : Prevail股票購買協議會員 美國通用會計原則:後續事件成員 2024-10-01 2024-10-01 0001321834 MYMD : Prevail 股票購買協議成員 us-gaap:後續事件成員 2024-10-01 0001321834 MYMD : Prevail 股票購買協議成員 us-gaap:後續事件成員 us-gaap:私募成員 2024-10-01 2024-10-01 iso4217:美元指數 xbrli:股份 iso4217:美元指數 xbrli:股份 純種成員

 

 

 

美國

證券交易委員會 及交易所

華盛頓特區，20549

 

表單 10-Q

 

（馬克 一）

☒ 根據1934年證券交易所法案第13或15(d)條款的季度報告

 

截至年度季度結束 9月30日， 2024

 

或

 

☐ 根據1934年證券交易法第13或15(d)條所述的過渡報告。

 

從 ____________ 到 的過渡期間 ____________

 

委員會 檔案號碼： 001-36268

 

TNF 制藥公司。

(根據公司章程所述的註冊人的正確名稱)

 

德拉瓦   22-2983783

(州 或其他管轄區域)

註冊或組織）

  

(I.R.S. 雇主

識別號碼

 

855 N. Wolfe Street, 623號套房

巴爾的摩, MD

   21205
（總執行辦公室地址）   （郵政編碼）

 

申報人的電話號碼，包括區號： (856) 848-8698

 

前名稱、前地址和前財政年度，如自上次報告以來有所更改：不適用

 

根據該法案第12(b)條紀錄的證券：

 

每一類的標題：   交易標誌   每家交易所的名稱：
每股面值$0.001的普通股   TNFA   你接受的訓練數據截止到2023年10月。 納斯達克 股票市場有限責任公司

 

勾選表示公司已按照證券交易法第13或15(d)條款的規定，在過去12個月（或公司需要提交此類報告的較短期限內）提交了所有所需的報告；並且公司在過去90天內一直受到此類提交報告的要求。 是的 ☒ 否 ☐

 

標示 勾選該項，表示申報人於過去12個月（或更短期間，申報人必須申報此類檔案的期間）內已按照法規S-t第405條（本章節第232.405條）要求遞交每一個互動式資料檔案。 是的 ☒ 否 ☐

 

請勾選來表明登記者是否為大型加速存取器、加速存取器、非加速存取器、較小的報告公司或新興增長公司。 請參閱《交易法》第120億2條規定中《大型加速存取器》、《加速存取器》、《較小的報告公司》和《新興增長公司》的定義。

 

大型及加速提交者 ☐ 加速提交者 ☐
非加速提交者 ☒ 較小的報告公司 ☒
新興成長型企業 ☐    

 

若屬新興成長公司，則請在適用於依據第13(a)款擬定的任何新或修訂財務會計準則時，打勾表示註冊人已選擇不使用過度過渡期遵守該準則。 ☐

 

請勾選是否登記者為外殼公司（依照交易所法規120億2的定義）。是 ☐ 否 ☒

 

截至2024年11月12日，登記人持有 2,755,067 每股面值$0.001 的普通股，已發行並流通。

 

 

 

 
 

 

目錄

 

第一部分 – 財務資訊  
     
項目 1. 基本報表 3
     
項目 2。 管理層對財務狀況和業績的討論與分析 43
     
項目 3。 市場風險的定量和定性披露。 61
     
項目 4。 內部控制及程序 61
     
其他資訊第二部分  
     
項目 1。 法律訴訟 62
     
項目 1A 風險因素 62
     
項目 2。 股票權益的未註冊銷售和資金用途 63
     
項目 3. 優先證券違約 63
     
項目 4. 礦業安全披露 63
     
項目 5. 其他資訊 64
     
項目 6. 展品 64
     
簽名 65

 

2
 

 

部分 一 - 財務資訊

 

I篇 1. 基本報表。

 

TNF 醫藥公司及其附屬公司

縮短的 合併資產負債表

2024年9月30日和2023年12月31日

(未經查核)

 

   2024年 9月30日   十二月 31, 2023 
   截至 為止 
   2024年 9月30日   十二月 31, 2023 
資產        
流動資產          
現金  $1,192,351   $2,681,010 
有價證券   9,449,483    2,242,106 
預付費用   1,385,101    893,226 
           
總資產 流動資產   12,026,935    5,816,342 
           
非流動資產          
租賃權利   18,285    47,389 
商譽   10,498,539    10,498,539 
對Oravax Medical的投資   1,500,000    1,500,000 
           
非流動資產總額   12,016,824    12,045,928 
           
總資產  $24,043,759   $17,862,270 
           
負債          
$          
交易 與其他應付款  $4,160,337   $3,716,218 
應付 至MyMD FL股東   29,982    29,982 
租賃 負債   18,285    48,870 
待發 分紅派息   1.498.119    265,019 
衍生品 負債   1,282,000    61,000 
認股權 負債   -    867,000 
           
總計 目前負債   6,988,723    4,988,089 
           
非流動 負債          
推遞聘 可支付金額，扣除當前數量   -    100,538 
           
總計 非流動負債   -    100,538 
           
負債總額   6,988,723    5,088,627 
           
承諾與懸案   -     -  
           
中間 權益          
Series F可轉換優先股。 15,000 已指定股數，面值$0.001 和面值$的已指定股數，1,000 每股$， 4,562 以及 6,633 截至2024年9月30日和2023年12月31日，已發行及流通股數為$。$的清償權優先權4,675,000 及回饋率為$每年的分紅派息， 10加上$的年率$。989,406 截至2024年9月30日   4,467,229    6,500,278 
優先股系列F可轉換優先股 - 折扣   (3,231,402)   (4,702,023)
優先股系列F可轉換優先股 - 衍生工具   (958,134)   (1,394,184)
優先股系列F-1可轉換優先股， 5,050 指定股份，面值$0.001 以及指定價值為$1,000 每分享， 5,050 和 0 於2024年9月30日和2023年12月31日現有及應付的股份。$賣空優先權5,050,000 加上分紅派息 每年 10%的$183,500 截至2024年9月30日   5,050,000    - 
F-1可換股優先庫藏股票 - 折扣   (5,050,000)   - 
G可換股優先庫藏股份， 12,826,273 已指定的股份，面值為$0.001 及陳述價值為$1,000 每分享， 8,950 和 0 自2024年9月30日及2023年12月31日期間已發行並流通的股份。分紅派息加權值為$8,950,000 加權值為$，加上每年%的紅利 10每年%的$優先股票價值的分紅派息325,213 截至2024年9月30日   8,950,000    - 
G系列可轉換優先股票-折扣   (8,950,000)   - 
           
總計 夾層股權   277,693    404,071 
           
股東權益          
優先 股票，面值 $0.001, 50,000,000 總授權優先股份總數          
系列 D可轉換優先股， 211,353 指定股份，面值 $0.001 面值和指定價值均為 $0.01 每分享， 72,992 發行股份截至2024年9月30日和2023年12月31日   144,524    144,524 
普通股，面值 $0.001, 250,000,000 授權股份數， 2,472,048 和 2,018,857 發行股份截至2024年9月30日和2023年12月31日   2,472    2,019 
額外 資本溢價   142,632,753    114,200,096 
累積 虧損   (126,002,406)   (101,977,067)
           
股東權益總額   16,777,343    12,369,572 
           
總計 負債、中間權益和股東權益  $24,043,759   $17,862,270 

 

請參閱這些未經審核的簡明合併基本報表的附註。

 

3
 

 

TNF 醫藥公司及其附屬公司

綜合損益縮短財務報表

(未經查核)

 

   2024   2023   2024   2023 
   三個月結束時   九個月結束時 
   九月 30,   九月 30, 
   2024   2023   2024   2023 
產品 營業收入  $-   $-   $-    $- 
產品 銷售成本   -    -    -     - 
毛利 收入   -    -    -     - 
                     
一般 及行政費用   1,104,130    1,334,690    3,192,762    4,202,594 
研究 和開發支出   707,747    1,912,322    2,307,789    4,907,196 
送轉 基於股票的補償支出   13,762    595,576    970,754    2,341,915 
F系列認股權證發行支出   -    -    -    762,834 
F-1系列認股權證發行支出   -    -    539,097    - 
G系列認股權證發行支出   -    -    969,505    - 
                     
營業損失   (1,825,639)   (3,842,588)   (7,979,907)   (12,214,539)
                     
其他 （收入）支出                    
利息 和股息收入   (163,951)   (139,056)   (203,405)   (339,731)
(收益)/損失 來自可出售金融資產的出售   (551)   500    (651)   714 
可出售金融資產公允價值變動   (4,746)   (2,324)   (3,771)   371 
衍生負債公允價值變動   356,000    (2,566,900)   367,000    (2,251,700)
權證負債公允價值變動   17,000    (5,356,000)   4,410,000    (8,166,000)
發行F-1系列可轉換優先股損失   -    -    3,737,000    - 
發行G系列可轉換優先股損失   -    -    5,109,000    - 
意外損失/(收益)   (100,000)   178,198    (100,000)   178,198 
                     
總計 其他 (收入)/支出   103,752    (7,885,582)   13,315,173    (10,578,148)
                     
收入/(虧損) 稅前所得   (1,929,391)   4,042,994    (21,295,080)   (1,636,391)
                     
所得 稅優惠/(提撥)   -    -    -    - 
                     
凈利潤 /(虧損)  $(1,929,391)  $4,042,994   $(21,295,080)  $(1,636,391)
                     
優先 股票送轉   751,052    1,158,051    2,730,259    1,690,180 
                     
可歸屬於普通股股東的 凈利潤/(虧損)  $(2,680,443)  $2,884,943   $(24,025,339)  $(3,326,571)
                     
每普通股基本 凈利潤/(虧損)  $(1.11)  $1.84   $(10.49)  $(2.28)
每普通股攤薄 凈利潤/(虧損)  $(1.11)  $0.37   $(10.49)  $(2.28)
                     
加權 平均基本普通股流通在外   2,415,089    1,564,275    2,290,962    1,456,327 
加權 平均稀釋普通股流通股份   2,415,089    7,818,886    2,290,962    1,456,327 

 

請參閱這些未經審核的簡明合併基本報表的附註。

 

4
 

 

TNF 醫藥公司及其附屬公司

合併財務報表中股東權益變動表

截至2024年和2023年9月30日的三個月和九個月

(未經查核)

 

                                                     
                   普通股             
   期權 F 可轉換優先股   期權 F-1 轉換優先股   期權 G 轉換優先股   系列 D 可轉換優先股       普通股 股票面額   額外 已付款   累積   總計 
   股票   F系列   股份   F期權   股份   F期權   股份   D輪   股份   $0.001  

資本額

   赤字   權益 
2023年12月31日餘額    6,633   $404,071    -   $-    -   $-    72,992   $144,524    2,018,857   $2,019   $114,200,096   $(101,977,067)  $12,369,572 
淨 虧損   -    -    -    -    -    -    -    -    -    -    -    (9,800,041)   (9,800,041)
發行 已發行限制股單位的普通股   -    -    -    -    -    -    -    -    908    1    (1)   -    - 
贖回 383 股份期權 F 系列可轉換優先股，2024年1月1日分期付款，金額為$1,429,871 用現金和普通股支付的   (383)   (23,699)   -    -    -    -    -    -    -    -    -    -    - 
加快 轉換 438 Series F可轉換優先股份的股份轉換加快   (438)   (26,300)   -    -    -    -    -    -    131,200    131    88,357    -    88,488 
贖回 812 Series F可轉換優先股份的股份贖回，2024年2月1日支付$的分期付款1,429,871 用現金和普通股支付   (812)   (49,773)   -    -    -    -    -    -    -    -    -    -    - 
加快 轉換 12 F系可換股優先股的股份   (12)   (914)   -    -    -    -    -    -    6,667    7    3,068    -    3,075 
可換股 優先股 股息   -    -    -    -    -    -    -    -    -    -    -    (1,201,867)   (1,201,867)
重新分類証券負債以反映証券修改   -    -    -    -    -    -    -    -    -    -    7,961,000         7,961,000 
股份 為基礎的薪酬 - 期權   -    -    -    -    -    -    -    -    -    -    517,365    -    517,365 
                                                                  
2024年3月31日的餘額   4,988   $303,385    -   $-    -   $-    72,992   $144,524    2,157,632   $2,158   $122,769,885   $(112,978,975)  $9,937,592 
淨虧損   -    -    -    -    -    -    -    -    -    -    -    (9,565,648)   (9,565,648)
發行 5,050 Series F-1可轉換優先股的股份，扣除折扣和發行成本$35,252   -    -    5,050    -    -    -    -    -    -    -    -    -    - 
發行 8,950 Series G可轉換優先股的股份，扣除折扣和發行成本$48,559   -    -    -    -    8,950    -    -    -    -    -    -    -    - 
加速轉換 225 Series F可轉換優先股的股份   (225)   (13,578)   -    -    -    -    -    -    150,000    150    45,530    -    45,680 
加快轉換 88 Series F可轉換優先股股份   (88)   (5,319)   -    -    -    -    -    -    62,791    62    17,832    -    17,894 
可轉換優先股股息   -    -    -    -    -    -    -    -    -    -    -    (777,340)   (777,340)
股份報酬 - 股票期權   -    -    -    -    -    -    -    -    -    -    439,627    -    439,627 
                                                                  
截至2024年6月30日餘額   4,675   $284,488    5,050   $-    8,950   $-    72,992   $144,524    2,370,423   $2,370   $123,272,874   $(123,321,963)  $97,805 
淨虧損   -    -    -    -    -    -    -    -    -    -    -    1,929,391)   (1,929,391)
加快轉換 113 F系列可換股優先股份   (113)   (6,795)   -    -    -    -    -         101,625    102    38,117    -    38,219 
可換股優先股息   -    -    -    -    -    -    -    -    -    -    -    (751,052)   (751,052)
修改認股權時的認股權負債再分類   -    -    -    -    -    -    -    -    -    -    19,308,000         19,308,000 
股本相關補償-股票期權   -    -    -    -    -    -    -    -    -    -    13,762    -    13,762 
                                                                  
截至2024年9月30日的結餘   4,562   $277,693    5,050   $-    8,950   $-    72,992   $144,524    2,472,048   $2,472   $142,632,753   $(126,002,406)  $16,777,343 

 

 

   系列 F   系列 F-1   系列 G   系列 D   普通股             
   可轉換 優先股   可轉換 優先股   可轉換 優先股   可轉換 優先股       普通 股   追加         
   股票   股票   股票   股票       面值    付款 在   累積   總計 
   股票   系列 F   股份   系列 F-1   股份   G系列   股票   D輪   股票   $0.001   資本   赤字   權益 
截至2022年12月31日的餘額    -   $-    -   $-    -   $-    72,992   $144,524    1,315,674   $1,316   $108,308,120   $(93,758,904)  $14,695,056 
淨 虧損   -    -    -    -    -    -    -    -    -    -    -    (1,511,732)   (1,511,732)
總結 從的股份 1換30 於2024年2月23日生效的反向拆股   -    -    -    -    -    -    -    -    65,960    66    (66)   -    - 
發行 的 15,000 系列F可轉換優先股的股份，扣除折扣和發行成本的14,087,111   15,000    912,889    -    -    -    -    -    -    -    -    -    -    - 
系列 F 可轉換優先股股息   -    -    -    -    -    -    -    -    -    -    -    (158,333)   (158,333)
股票 基礎補償 - 股票期權   -    -    -    -    -    -    -    -    -    -    69,068    -    69,068 
                                                                - 
截至2023年3月31日的結餘   15,000   $912,889    -   $-    -   $-    72,992   $144,524    1,381,634   $1,382   $108,377,122   $(95,428,969)  $13,094,059 
淨 損失   -    -    -    -    -    -    -    -    -   $-   $-    (4,167,653)   (4,167,653)
轉換 的 1,250 系列F可轉換優先股的股份，2023年7月1日的分期付款$1,429,871 以普通股支付的   (1,250)   (76,074)   -    -    -    -    -    -    39,587    40    255,905    -    255,945 
轉換 的 1,250 F系列可轉換優先股的股份，2023年8月1日的分期付款為$1,429,871 以普通股支付   (1,250)   (76,073)   -    -    -    -    -    -    38,688    39    255,905    -    255,944 
F系列可轉換優先股股息   -    -    -    -    -    -    -    -                   (373,796)   (373,796)
為已歸屬的限制性股票單位發行普通股   -    -    -    -    -    -    -    -    2,460    2    (2)   -    - 
行使預付的股權遠期合約   -    -    -    -    -    -    -    -    4,505    4    (4)   -    - 
以股票為基礎的補償 - 期權   -    -    -    -    -    -    -    -              1,677,271    -    1,677,271 
                                                                  
截至2023年6月30日餘額   12,500   $760,742    -   $-    -   $-    72,992   $144,524    1,466,874   $1,467   $110,566,197   $(99,970,418)  $10,741,770 
淨 利潤   -    -    -    -    -    -    -    -    -    -    -    4,042,994    4,042,994 
轉換 為 1,250 系列F可轉換優先股的股份，2023年9月1日的分期付款為$1,429,871 以普通股支付   (1,250)   (76,074)   -    -    -    -    -    -    67,732    68    255,877    -    255,945 
轉換 為 1,250 系列F可轉換優先股的股份，2023年10月1日的分期付款為$1,429,871 以普通股支付   (1,187)   (63,659)   -    -    -    -    -    -    58,450    58    214,118    -    214,176 
加速 轉換 204 系列F可轉換優先股的股份   (204)   (12,416)   -    -    -    -    -    -    10,550    10    41,759    -    41,769 
視為 股息，用於調整2023年8月1日的系列F可轉換優先股分期付款，並以普通股支付   -    -    -    -    -    -    -    -    29,045    29    766,474    (766,503)   - 
系列 F 可轉換優先股股息   -    -    -    -    -    -    -    -    -    -    -    (391,548)   (391,548)
基於股票的補償 - 股票期權   -    -    -    -    -    -    -    -    -    -    595,576    -    595,576 
                                                                  
截至2023年9月30日的餘額    9,859   $608,593    -   $-    -   $-    72,992   $144,524    1,632,651   $1,632   $112,440,001   $(97,085,475)  $15,500,682 

 

請參閱這些未經審核的簡明合併基本報表的附註。

 

5
 

 

TNF 醫藥公司及其附屬公司

綜合現金流量表

(未經查核)

 

   2024   2023 
   九個月結束時 
   九月 30, 
   2024   2023 
營運活動現金流量：          
淨 虧損  $(21,295,080)  $(1,636,391)
調整淨損失以符合營運活動所使用之現金：          
(資產增值)/損失 交易可變現證券的收益   (651)   714 
可變現證券的公允價值變動   (3,771)   371 
衍生工具的公允價值變動   367,000    (2,251,700)
warrants公允價值變動   4,410,000    (8,166,000)
發行F-1可轉換優先股虧損   3,737,000    - 
發行G可轉換優先股虧損   5,109,000    - 
股票報酬基礎性質          
期權發放給董事   410,810    769,657 
期權發放給關鍵員工   496,494    1,429,693 
期權發放給非員工   63,450    142,565 
資產和負債的變化          
預付費用   (491,875)   (697,691)
交易 與其他應付款   444,119    (639,381)
營運租賃   (1,481)   168 
逕延 欠款薪酬   (100,538)   - 
股利 應付款   (1,356,709)   - 
營運活動產生之淨現金流出   (8,212,232)   (11,047,995)
           
投資活動產生的現金流量：          
購買 有價證券   (12,703,405)   (13,338,466)
銷售有價證券的收益   5,500,450    9,250,000 
投資活動使用的淨現金   (7,202,955)   (4,088,466)
           
來自融資活動的現金流量          
贖回F系列可換股優先股   (73,472)   - 
F系列可換股優先股發行的淨收益   -    14,685,689 
F-1系列可換股優先股發行的淨收益   5,050,000    - 
G系列可換股優先股發行的淨收益   8,950,000    - 
融資活動流入淨額   13,926,528    14,685,689 
           
現金減少   (1,488,659)   (450,772)
期初現金及現金等價物   2,681,010    749,090 
期末現金及現金等價物  $1,192,351   $298,318 
           
補充現金流資訊          
支付現金：          
利息  $-   $- 
所得 稅  $-   $- 
           
其他非現金籌資和投資活動補充資料表          
發行F系列可轉換優先股股息的應計  $-   $204,194 
根據發行F系列可轉換優先股和認股權的情況，認股權負債的初始公允價值  $-   $10,623,000 
根據發行F系列可轉換優先股和認股權的情況，衍生負債的初始公允價值  $-   $3,149,800 
根據發行F-1系列可轉換優先股和認股權的情況，認股權負債的初始公允價值  $7,933,000   $- 
根據發行F-1系列可轉換優先股和認股權的情況，衍生負債的初始公允價值  $854,000   $- 
根據發行G系列可轉換優先股和認股權的情況，認股權負債的初始公允價值  $14,059,000   $- 
針對F認股權的更改重新分類認股權負債  $7,961,000   $- 
針對F-1認股權的更改重新分類認股權負債  $6,965,000   $- 
重新分類 交易G Warrants時期權責任更改  $12,343,000   $- 

 

請參閱這些未經審核的簡明合併基本報表的附註。

 

6
 

 

TNF 醫藥公司及其附屬公司

註解 至未經審計的簡明合併財務報表

 

注意 1 – 組織和業務簡介

 

TNF 製藥有限公司是一家特拉華州公司（以下簡稱「TNF」或「公司」），其在重組（以下定義）之前於新澤西州註冊成立。2024年7月22日，該公司通過向特拉華州國務卿提交修改公司章程的證明，將其名稱由MyMD製藥有限公司更改為TNF製藥有限公司。此外，自2024年7月24日市場交易開盤前生效，該公司的普通股，面值$0.001 每股（「普通股」）停止以逐筆明細「MYMD」進行交易，並開始在納斯達克證券市場以逐筆明細「TNFA」進行交易。

 

此份總括的基本報表包括兩家全資子公司，截至2024年9月30日，即Akers Acquisition Sub, Inc.和Bout Time Marketing Corporation（以下簡稱「公司」）。所有重要的公司內部交易在合併中已被消除。

 

MYMD-1 是一種口服的下一代TNF-α抑制劑，具有改變基於TNF-α的疾病治療方式的潛力，因為它的選擇性及跨越血腦屏障的能力。. 與目前可用的TNF-α抑制劑相比，其口服劑量的便利性是顯著的區別，所有這些抑制劑都需要通過注射或輸注進行給藥。MYMD-1 已被證明能夠選擇性地阻止TNF-α在過度激活的情況下的作用，而不會妨礙它對常見感染的正常反應。MYMD-1在抑制炎症方面的雙重效果是通過同時阻止TNF-a和IL-6的活性，而目前批准的治療類風濕性關節炎的抗TNF和抗IL-6療法只能針對其中之一。此外，在早期臨床研究中，它並未與已知會發生於傳統免疫抑制療法中的嚴重副作用相關。

 

公司於2023年7月31日舉行的股東週年大會上，股東們批准了將公司合併並入一家新成立的全資子公司MyMD Pharmaceuticals, Inc.，一家特拉華州公司（“MyMD Delaware”），MyMD Delaware為倖存公司，旨在將公司的註冊地由新澤西州改為特拉華州（“重新註冊”）。重新註冊於2024年3月4日生效。針對公司重新註冊至特拉華州，公司普通股和優先股的面額已更改為$0.001每股。

 

MyMD 根據1934年證券交易法第12g-3條款，特拉華州被視為MyMD新澤西的繼承發行人。

 

公司的重新設立沒有改變公司名稱、業務、管理、財務年度、會計、總執行辦公室的位置、資產或負債。此外，公司的普通股保留相同的CUSIP編號，並繼續在納斯達克資本市場以"MYMD"標的進行交易。公司普通股股東不需要將現有的 MyMD 新澤西州股票證替換為 MyMD 特拉華州股份證。

 

從公司重新設立的生效日期開始，公司股東的權利受到特拉華州一般公司法、MyMD特拉華認股證書和MyMD特拉華公司章程的規範。

 

在 2024年2月14日，本公司進行了 1換30 反向股票拆分（稱為“反向股票拆分”）。與 反向股票拆分同時，公司的普通股授權發行的股份數量從 500,000,000 股份 減少至 16,666,666 股份，並且我們的授權資本股票從 550,000,000 股 66,666,666 股份減少。反向股票拆分 減少了已發行和流通的普通股總數，包括公司持有的庫藏股。所有 股份數量已根據反向股票拆分進行追溯調整，除非另有說明。

 

2024年7月25日，本公司通過修訂公司章程，將公司普通股授權股份數增加至 16,666,666 年逐年獲得 250,000,000並透過向特拉華州州務卿提交修訂公司章程的證書，對公司的資本股授權股份數進行相應變更（“股份增加”）。股份增加獲得公司股東在2024年7月24日舉行的股東特別會議上批准。

 

近期 事件

 

二零二三年二月的發行

 

2023年2月21日，公司與某些合格投資者（即F係列投資者）簽署了證券購買協議（「F系列購買協議」），根據該協議，公司同意向投資者賣出（i）總計 15,000本公司新指定的F係列可轉換優先股，面值為每股$1,000，最初可轉換為最高 6,651,885股（拆股前）的本公司普通股，初始換股價為每股$2.255，半侵權取得最高 6,651,885股（拆股前）的本公司普通股的認股權，根據調整（即「F係列認股權」）（合稱為2023年2月發售）。股份逆轉股份分割後，（i）F係列優先股的換股價按照F係列指定書（如下所定義）的條款調整為每股$3.18，（ii）F係列認股權的行使價調整為每股$3.18，並且根據F係列認股權的行使比例比例調整了可行使F係列認股權所發行的普通股股份 4,716,904 根據F系列認股權憑證的條款，進行股份出售。

 

就私募（如下所定義）而言，（i）A股優先股轉換價格已根據A股指定書中的全額護捌抵減條款調整至$1.816 每股，（ii）A股認股權行使價格已調整至$1.816 每股，並且根據A股指定書中的全額護捌抵減條款按比例調整了A股認股權行使後可發行的普通股數量至 8,259,911 股。

 

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系列 F可轉換優先股

 

系列F優先股在發行時可轉換為普通股（以下簡稱「系列F轉換股」），持有人可隨時依選擇轉換，初始轉換價為$2.255 （拆股前）（根據調整後的，以下簡稱「系列F轉換價格」）。系列F轉換價格受送轉、拆股、重新分類等慣常調整的影響，並且在發行任何普通股或可轉換、可行使或可兌換為普通股的證券，且價格低於當前適用的系列F轉換價格時（有某些例外情況）則受價格調整的影響。在反向拆股後，系列F轉換價格調整為$3.18 每股依據系列F可轉換優先股的設計證書的條款，該證書隨後經由修訂和重述的系列F可轉換優先股設計證書的提交而修訂和重述，自2024年4月8日生效（經修訂和重述後，以下簡稱「系列F設計證書」）向特拉華州國務卿提交。系列F轉換價格進一步調整為$1.816每股依據系列F設計證書中包含的完全防稀釋條款，與私人配售相關（如本文所定義）。

 

在F系列修訂證書（如下所定義）之前，公司最初被要求以等額的12個月分期，於2023年7月1日開始贖回系列F優先股。 在這種贖回情況下到期的攤銷支付可由公司選擇以現金支付，或在某些限制下以普通股支付，支付金額按以下兩者中較低者計算：(i) 當時有效的系列F轉換價格，以及 (ii) （A）在攤銷支付到期日前30個交易日內公司系列F普通股最低三個收盤價格的平均值的80%，以及 (B) 按拆分後的基礎設定的“底價”為6.60美元（根據拆股、送轉、股票合併、資本重組或其他類似事件的情況進行調整），或者在任何情況下，根據納斯達克股票市場不時允許的較低金額。

 

開啟 2024 年 4 月 5 日，本公司與所需持有人簽訂綜合豁免及修訂（「綜合協議」） (根據 F 系列指定證書中的定義)。根據《綜合協議》，所需持有人同意 (i) 延期 根據第 9 (a) 條支付 2024 年 3 月 1 日及 2024 年 4 月 1 日到期的每月分期付款金額（「分期付款」） F 系列指定證書，直至 2024 年 5 月 1 日，以及 (ii) 豁免任何違反或違反 F 系列購買協議， F 系列指定證書，或因缺失分期而產生的 F 系列認股認股證。本公司可能要求持有人 如普通股的收市價超過 $，將其 F 系列優先股轉換為普通股股6.765 每股 （根據反向股票分割調整）（可根據股票分割，股息，股票組合，重資本化作出調整 或其他類似事件）連續 20 個交易日，普通股的每日美元交易量超過 $3,000,000 每 同期內的日期，並符合 F 系列指定證書中所述的某些股權條件。

 

開啟 2024 年 5 月 20 日，本公司與本公司簽訂全面豁免、同意、通知及修訂（「F 系列協議」）。 必要持有人（定義於 F 系列指定證書中的定義）。根據 F 系列協議，所需持有人同意 至 (i) 修改 F 系列購買協議，以修改有關該協議下的購買權利的若干條款，(ii) 放棄某些權利 根據發行該公司系列的 F 系列採購協議和 F 系列指定證明書 F-1 可換股優先股，面值為 $0.001 每股，指定價值為 $1,000 每股 (「F-1 系列優先 Stock」)，該公司的 G 系列可換股優先股，面值為 $0.001 每股，指定價值為 $1,000 每股（「G 系列優先股」），並由本公司加入購買協議（如本文定義），(iii) 豁免該公司根據 F 系列要求保留足夠數量的普通股發行的規定 指定證書、F 系列購買協議及 F 系列認股權證，直至本公司獲得股東 批准（如本文定義），及 (iv) 同意根據需要發行 F-1 系列優先股及 G 系列優先股 根據 F 系列指定證書、F 系列購買協議及 F 系列認股認股權證的若干條款， 適用。本公司及所需持有人根據 F 系列協議進一步同意修訂 F 系列證書 向 F 系列指定證明書提交修訂證明書（「F 系列證書）的指定 修正案」）與特拉華州國務司長提交。F 系列修訂證書修訂 F 系列證書 指定（i）延長到期日至 2024 年 12 月 31 日，(ii) 允許和修改與付款有關的若干程序 有關於分期日期（如 F 系列指定證明書中定義）的分期金額為 （包括）2024 年 7 月 1 日及（包括）2024 年 8 月 1 日（包括）根據此，以及 (iii) 修改分期日期的時間表。

 

8
 

 

持有F系列優先股的股東有權獲得分紅派息， 10% 每年，按月複利計算，根據F系列指定條款，以現金或普通股的形式支付，這由公司選擇。當觸發事件（如F系列指定條款中所定義）發生並持續期間，F系列優先股的分紅派息累計按， 15% 每年。轉換或贖回時，F系列優先股的持有者還有權收到分紅派息補償金。除非根據適用法律要求，F系列優先股的持有者有權與普通股的持有者按轉換後的基礎進行投票，F系列優先股持有者的投票數量應按每股$60.21 計算，該價格是執行和交付F系列購買協議之前適用的最低價格（根據納斯達克證券市場規則5635所定義），並受F系列指定條款中規定的某些利益擁有限制所約束。F系列指定條款還進一步規定，F系列優先股的記錄持有人，專屬且作為單獨階級，有權在2024年6月30日之前選舉一名公司董事。自2024年4月8日起，公司任命米切爾•玻璃博士為公司董事會成員，玻璃先生由F系列優先股持有者選舉至該職位。在截至2024年9月30日和2023年9月30日的三個月內，公司記錄的分紅派息總額為$393,937和$391,548，分別在綜合綜合損失的簡明財務報表中報告為F系列優先股分紅派息。在截至2024年9月30日和2023年9月30日的九個月內，公司記錄的分紅派息總額為$1,375,889和$923,677分別在綜合財務報表中以優先股分紅派息列示。

 

儘管如此，公司的結算轉換能力以及使用普通股進行攤銷和股息補償支付受到在F系列設計證書中規定的某些限制。此外，F系列設計證書包含在考慮到基於F系列設計證書或F系列warrants的轉換、攤銷支付或股息補償支付而可發行的普通股的發行後的某些實益擁有權限制。

 

第F系列優先股被歸類為暫時權益，因為持有第F系列優先股的持有人有權要求公司在Common股票停止交易或未出現交易或上市（適用時）於符合資格的市場連續五（5）個交易日後將其全部或部分股份兌換為現金。第F系列優先股並非無條件可兌換，只有在交易暫停或失敗時，持有人才可以選擇性地放回。這將不被視為公司所能控制的範疇內。

 

優先F系列股份被判定更像是一個債務樣的承擔者，而不是一個股權樣的承擔者。公司確定以下嵌入式特性與債務主標的不明確和密切相關：1）在條件性贖回事件時支付全額利息，2）在轉換事件時支付全額利息，3）在權益條件失敗時（定義於F系列指定憑證中）的分期贖回，以及4）變量股份結算的分期轉換。這些特性被捆綁在一起，被賦予可能受影響的概率並以公平價值計量。這些特性公平價值的後續變動會在綜合損益表中認列。公司在發行時估計了這些特性的公平價值為$3,149,800 使用Monte Carlo模擬模型來確定嵌入式衍生金融工具的公平價值，使用以下輸入數據：發行日期時我們的普通股公平價值為$1.90 ，估計的股權波動率為 120.0%，估計的交易量波動率為 190.0%，到期時間為 1.35 年，折現市場利率為 6.8%，股息率為 10.0%，罰息率為 15.0%，以及違約機率。 0.5分拆衍生負債的公平價值是利用有和沒有方法來估算的，該方法使用具有衍生品的情景和沒有衍生品的普通到期情景之間的機率加權差異。

 

對公允價值的折扣被計算為對F系列優先股的帳面價值的減少。公司在F系列優先股的發行中記錄了總折扣為$14,087,111 ，該折扣由相關嵌入衍生品的發行日期公允價值$組成3,149,800、股票發行成本為$314,311 以及F系列warrants的公允價值$10,623,000.

 

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在截至2024年9月30日及2023年9月30日的三個月內，公司錄得虧損$0 及收益$2,566,900， 分別與衍生負債的公允價值變動有關，該項目記錄在綜合損益的其他收入（費用）中。 在截至2024年9月30日及2023年的九個月內，公司錄得收益$61,000和$2,251,700， 分別與衍生負債的公允價值變動有關，該項目記錄在綜合損益的其他收入（費用）中。公司估計截至2024年9月30日的$0 衍生性金融工具的公平價值，使用蒙地卡羅模擬模型，並使用以下參數；公司普通股的公平價值為$1.62 於評估日期，估計股權波動率為 80.0%， 估計的成交量波動率為 330.0%, 到期時間為 0.25 年，折扣市場利率為 12.5%， 股息率為 10.0%， 罰金股息率為 15.0%， 違約概率為 7.4%.

 

系列 F普通股認股權證

 

根據 2023年2月的發行，公司向投資者發行了F系列warrants以購買 4,716,904 普通股的 每股初始行使價格為$3.18 （需調整），調整為$1.816 每股，行使F系列warrants可發行的普通股數量 已根據F系列warrants中包含的全面反稀釋條款按比例調整為 8,259,911 普通股的 數量（在此定義的私募配售中）(“F系列行使價格”)，有效期為 五年 自發行之日起 F系列行使價格及F系列warrants行使可發行的股票數量，需根據送轉、拆股並股、重新分類等進行慣常調整，並在普通股的發行， 或者可轉換、可行使或可交換為普通股的證券，若價格低於當時適用的行使價格（受到某些例外情況的限制），則根據“全面反稀釋”的基礎進行價格調整。對於任何此類基於價格的行使價格調整，行使F系列warrants可發行的普通股數量將按比例增加。

 

序列F認股權證被確定為範疇在ASC 480-10內，因為在發生基礎交易（如協議所定義）時，這些認股權證可以由持有人選擇向公司贖回。因此，公司將序列F認股權證按公允價值記錄為負債，後續公允價值變動則在收益中認列。公司使用Black Scholes模型來計算這些認股權證的價值。序列F認股權證的公允價值為$10,623,000 於發行日期估計認股權證的公允價值，使用以下加權平均假設：股息率 0%；期限 5.0 年；股本波動率 125.0%；以及無風險利率 4.09%.

 

交易 因發行系列 F warrants 而產生的成本 $762,834 已依據 ASC 480 立即列為費用。

 

在截至2024年9月30日的三個月內，該公司沒有因將F系列權證負債重新分類為權益而記錄公允價值變動的收益或損失 （見下文）。在截至2024年9月30日的九個月內，該公司記錄了$7,094,000 與因2024年3月31日將F系列權證負債重新分類為權益所致的F系列權證負債公允價值變動相關的損失，該損失記錄在簡明綜合損失表的其他收益（費用）中。F系列權證的公允價值為$7,961,000 在2024年3月31日利用Black Scholes模型估計，其使用的加權平均假設為：股息收益率 0%; 剩餘期限為 3.90 年; 股本波動率為 110.0%; 以及無風險利率為 4.31%.

 

截至2023年9月30日的三個月內，公司記錄了一筆$的收益。0 與系列F權證負債公允價值變動相關，該收益記錄在綜合損益簡表的其他收入（費用）中。在截至2023年9月30日的九個月內，公司記錄了一筆$的收益。8,166,000 與系列F權證負債公允價值變動相關，該收益記錄在綜合損益簡表的其他收入（費用）中。

 

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開啟 2024 年 5 月 14 日，公司與 F 系投資者簽訂修訂（「F 系列認股權證修訂」） 二零二三年二月發售，自二零二四年三月三十一日起生效。F 系列認股權證修訂修訂修訂 F 系列認股權證的部分條款 有關 F 系列認股權證持有人的權利，規定在發生基本交易時（如定義） 在 F 系列認股權證）不屬於本公司控制範圍內，包括未獲批准的基本交易 本公司董事會、F 系列認股權證持有人只有權從本公司或其他任何方面獲得 繼承實體具有相同類型或形式的代價（並以相同比例計算），以未行使部分的黑色斯科爾斯價值計算 該等 F 系列認股權證，該認股權證正在與基本基本有關的公司普通股持有人提供和支付。 交易，無論該代價是以現金、股票或任何組合形式的形式 其中，或普通股持有人是否可以選擇從其他形式中獲得相關的代價 有關基本交易；另外，如本公司普通股持有人不獲發售或支付任何代價 在該基本交易中，該等普通股持有人將被視為已收到繼任實體的普通股（ 該等繼承實體可能是該基本交易中的該基本交易後的公司。這項修改導致 F 系列認股權證重新分類，將其視為已分類的股權 不再在 ASC 815 的範圍內。根據 ASC 815-40 規定，公司將 F 系列認股證負債重新評估為 $7,961,000 截至二零二零四年三月三十一日（修改生效日期）的公平價值，並已承認的 $7,094,000 公平價值變動的損失 並重新分類 $7,961,000 截至 2024 年 3 月 31 日，F 系列認股權證對額外存款資本的公平價值。

 

在2024年11月7日，每位F系列優先股份的持有人同意，公司的任何分期付款金額（根據F系列授權證書的定義）如截至2024年11月7日已累積且未贖回、未轉換及/或其他未支付的金額，將延遲至2024年12月1日支付。

 

系列 F-1 定向增發

 

2024年5月20日，公司與特定的認可投資者（“F-1系列投資者”）訂立了一份證券購買協議（“F-1系列購買協定”），根據協定，公司同意向F-1系列投資者出售（i）總計 5,050 公司新指定的F-1系列優先股份的股份，最初可換股成多達 2,780,839股普通股，換股價格為每股1.816 美元，（ii）短期認股權證，可買入總計 2,780,839股普通股（“F-1短期認股權證”），行使價格為每股1.816 美元，及（iii）長期認股權證，可買入總計 2,780,839 股普通股（“F-1長期認股權證”，以及與F-1短期認股權證合稱為“F-1認股權證”），行使價格為每股1.816 美元（總稱為“F-1定向增發”）。F-1定向增發的交割於2024年5月23日進行（“F-1交割日期”）。

 

系列 F-1優先股份

 

一旦發行，第五系列可換股優先股（“第五系列可換股股份”）可由持有人隨時選擇轉換為普通股，在初始換股價格為$1.816 （“第五系列可換股價格”）。 第五系列可換股價格受慣例調整，涵蓋送轉、拆股並股、重分類等調整，並受到價格調整限制，即在任何以低於當時適用的第五系列可換股價格（特定例外情況除外）發行的普通股，或可合換、行使或交換以取得普通股的證券。

 

公司須在2024年12月1日起，以七(7)個相等的月付款分期償還F-1特優股。 償還款項應根據公司選擇，在現金以面值105%的適用分期償還金額（如F-1證書中所定義）支付，或者在普通股票中支付，其價值不高於(i)當時生效的F-1換股價和(ii)公司普通股票在截至並包括償還款項到期前一天的三十個連續交易日期間內的三個最低收盤價的平均值的80%之間，或者(B) 0.364美元，即是當時F-1股東批准（如所述）獲得的“最低價格”（如納斯達克股票市場規則5635）的20%，或者，在任何情況下，如作許可，由納斯達克資本市場，以及，在每種情況下，根據股份拆股並轉、股息、股份合併、股份重組或其他類似事件的調整，這些償還金額根據F-1證書中所載的部分調整進行調整（“F-1底價”）。

 

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系列F-1優先股的持有人有權享有每年 % 的分紅派息， 10按月複利計算，分紅派息以現金或普通股的形式支付，具體取決於公司的選擇，並根據系列F-1設計證書的條款進行。當觸發事件（在系列F-1設計證書中定義）發生並持續期間，系列F-1優先股的分紅派息將按每年 % 的利率累積。 15在轉換或贖回時，系列F-1優先股的持有人還有權獲得分紅派息的全額支付。系列F-1優先股的持有人有權與普通股持有人按照轉換基準投票，系列F-1優先股持有人的投票數量將根據每股 $ 的轉換價格計算，2.253 該價格是適用於執行和交付系列F-1購買協議之前的最低價格（在納斯達克股票市場規則第5635條中定義），並受到系列F-1設計證書中規定的某些有益擁有權限制的約束。在截至2024年和2023年9月30日的三個月期間，公司的分紅派息總額為 $421,102 並且 $0，分別報導為綜合損失的簡明合併報表中的系列F優先股分紅派息。在截至2024年和2023年9月30日的九個月期間，公司記錄的分紅派息總額為 $488,541 和 $0，分別報導為綜合損失的簡明合併報表中的系列F優先股分紅派息。

 

儘管如此，該公司的轉換結算能力及使用普通股進行攤銷和股息補償支付的能力受到F-1系列設計證書中某些限制的約束。此外，F-1系列設計證書在考慮到因轉換、或作為F-1系列設計證書或F-1 warrants下的任何攤銷支付或股息補償支付所發行的普通股的情況後，包含某種有益擁有權的限制。

 

系列F-1優先股被歸類為臨時股權，因為系列F-1優先股的持有者有權要求公司以現金贖回所有或任何部分的該持有者的股份，當交易暫停或普通股在一個合格市場上交易或上市（視情況而定）五（5）個連續交易日的期間內。系列F-1優先股並不是無條件可贖回的，只能在持有者選擇的情況下，在此交易暫停或失敗時有條件地出售。這不會被認為在公司的控制之內。

 

於發行日期，F-1優先股的預估公允價值約為$9.3百萬，是利用蒙特卡羅模擬來決定的。Warrants的預估總公允價值約為$7.9百萬，是利用Black Scholes模型來決定的。Warrants的總公允價值超出交易的總毛收入，因為Warrants是處於賺錢狀態下發行的。此外，關於F-1優先股的衍生負債公允價值於發行日期時被確定為約$0.9百萬，截至2024年9月30日。截至2024年9月30日止三個和九個月，公司認列了$1,282,000 的非現金損失。356,000和$428,000，分別。

 

該 約$5.1 百萬的股票折扣（對應於優先股）是來自於 (i) 約$420萬的金額與系列F-1優先股的總收益與分配的剩餘公允價值之間的差額（即$0）有關，以及(ii) 約$90萬與發行時的股票衍生工具有關，這部分將被認列為對系列F優先股賬面價值的減少，並將根據ASC 480-10-S99-3A自發行日起到期進行增值，因為根據系列F-1設計證書的分期贖回條款，贖回被視為可能。

 

截至2024年9月30日和2023年，公司記錄了一筆虧損$，分別與衍生負債的公平值變動有關，記錄於綜合損益表的其他收入（支出）。356,000 並且 $0截至2024年9月30日和2023年九個月，公司記錄了一筆虧損$，分別與衍生負債的公平值變動有關，記錄於綜合損益表的其他收入（支出）。367,000 和 $0公司估計了在2024年9月30日的分割嵌入式衍生工具的公平值，使用蒙特卡洛模擬模型，參數為：估計日期的公司普通股公允價值為$，1,282,000 估計日期的$公司普通股公允價值為$1.62 ，估計股權波動率為 100.0%，估計的交易量波動率為 275.0%，剩餘到期時間 的 0.75 年，折扣後市場利率為 4.18%，股息率為 10.0%，罰息率為 15.0%，及違約機率為 5.2%.

 

系列 F-1認股權證

 

根據以下分析，「Series F-1認股權證」被列為負債。 「Series F-1優先股」被確定更像債務性主體而非股權性主體。 公司確定了與債務主體工具不明確和密切相關的嵌入式功能：1)在條件贖回事件時提供補償利息，2)在轉換事件時提供補償利息，3)在股權條件失敗時提供分期贖回(定義於「Series F證書條款」)，以及4)可變股份結算分期轉換。 這些功能被捆綁在一起，分配可能受影響的機率並計算公平價值。 這些功能的公平價值變動會反映在「綜合損益簡明綜合收支表」中。 公司估計在發行時嵌套衍生工具的公允價值為$3,149,800 使用蒙特卡洛模擬模型，估計在發行日期的我們普通股公允價值為$1.90 年估計股權波動性成交量 120.0%，估計的交易量波動率為 190.0%，到期時間為 1.35 年，折扣市場利率 6.8%，股息率為 10.0%，罰息率為 15.0%，以及違約機率。 0.5%. 該分離金融負債的公平值是使用「有」和「無」方法估計的，該方法利用帶有衍生工具的情景與不帶衍生工具的純香草到期情景之間的概率加權差異。

 

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根據F-1系列定向增發，公司向投資者發行了(i) F-1系列長期warrants，以購買 2,780,839 分享 普通股，每股執行價格為$1.816 （需調整），自發行之日起五年內有效 以及(ii) F-1系列短期warrants，以購買 2,780,839 分享普通股，每股執行價格為$1.816 （需調整），自發行之日起十八個月內有效。

 

Series F-1權證的執行價格及可通過行使Series F-1權證發行的股份數，受慣例性的股息、拆股並股、重新分類等調整的影響，並根據價格的調整，在任何以低於當時適用的執行價格發行普通股或可轉換、行使或交換為普通股的證券的情況下，在“全額提升”基礎上進行調整（受特定例外條件限制）。在任何這種價格調整對執行價格的影響下，可通過行使Series F-1權證發行的股份數將按比例增加。

 

開啟 2024 年 8 月 16 日，本公司通過該系列（i）一項修訂（「F-1 系列長期權證修訂」） F-1 投資者，自 2024 年 6 月 30 日有關 F-1 系列長期權證生效，及 (ii) 修訂（「系列） F-1 短期認股權證修訂」及「F-1 系列長期權證修訂」及「F-1 系列認股權證 對 F-1 系列投資者進行的修訂」），自 2024 年 6 月 30 日有關 F-1 系列短期認股權證有關。系列 F-1 認股權證修訂修訂修訂有關 F-1 系列認股權證持有人權利的若干條款 在發生非本公司之內的基本交易（如 F-1 系列認股權證所定義）時，規定 控制，包括未經本系列持有人之公司董事會批准的基本交易 F-1 認股權證只有權從本公司或任何繼任實體獲得相同類型或形式的代價（以及 相同比例），以發售及支付該類 F-1 系列認股權證未行使部分的黑書士價值 向與基本交易有關的本公司普通股持有人，無論該代價是以現金、股票或任何組合形式 其中，或普通股持有人是否可以選擇從其他形式中獲得相關的代價 有關基本交易；另外，如本公司普通股持有人不獲發售或支付任何代價 在該基本交易中，該等普通股持有人將被視為已收到繼任實體的普通股（ 該等繼承實體可能是該基本交易後的公司）。此外，F-1 系列認證 修訂修訂修訂與波動性輸入相關的 Black Scholes 價值的定義，該定義現在為等於 30 天波動率，從彭博社的「HVT」函數獲得（使用 365 天年化係數確定）為 (1) 適用基本交易公開披露最早發生之後的交易日之交易日 及 (2) 持有人要求的日期。這項修改導致 F-1 系列認股權證重新分類，以考慮 由於不再屬於 ASC 815 的範圍內的股票被歸類為。根據 ASC 815-40 規定，公司重新測量 F-1 系列 截至二零二四年七月二十五日，以公平價值計算的認股證 ($6,965,000），並識別了 $6,000 公平價值變動為非現金虧損並重新分類 截至 2024 年 7 月 25 日，增加已繳資本的 F-1 系列認股權證。截至 2024 年 9 月 30 日止九個月內，公司承認公平價值變化的非現金收益 為 $968,000.

 

系列 G 定向增發

 

2024年5月20日，公司與特定合格投資者（「G系列投資者」與F-1系列投資者共同簽署的"Series G購買協議"，每一份為一份"購買協議"，總稱為"購買協議"），擬定向特定合格投資者（「G系列投資者」）賣出（i）公司新指定的G系列優先股的股份，最初可轉換為最多 shares of the Company’s Common Stock，轉換價格為每股$ ，（ii）短期認股權證，可獲得的Common Stock股份上限為 shares（「G系列短期認股權證」），行使價為每股$ ，及（iii）長期認股權證，可獲得的Common Stock股份上限為 shares（「G系列長期認股權證」，與G系列短期認股權證共同稱為「G系列認股權證」），行使價為每股$ （總稱為「G系列定向增發」，與F-1系列定向增發等私人增發各自為一份"私人增發"，總稱為"私人增發"）。G系列定向增發的交割發生於2024年5月23日（「G系列結束日期」與F-1系列結束日期共同為「結束日期」）。 8,950 shares of the Company’s newly-designated Series G Preferred Stock, initially convertible into up to shares of the Company’s Common Stock, at a conversion price of $ per share 4,928,416 shares1.816 shares 4,928,416 每股$ 1.816 shares 4,928,416 shares1.816 每股$

 

系列 G 优先股

 

在發行時，G系列優先股可以轉換為普通股（“G系列轉換股票”），持有人可以隨時選擇以每股$初期轉換價格轉換1.816 （“G系列轉換價格”）。G系列轉換價格需根據股票送轉、拆股並股、重分類等習慣性調整，並在任何以低於當時適用的G系列轉換價格出售普通股，或價格低於當時適用的G系列轉換價格的可轉換、行使或兌換成普通股的證券事件時進行價格調整（特定例外除外）。在G系列優先股發行日期之後的任何時間，公司可選擇以溢價現金贖回所有或部分尚未贖回的G系列優先股股份，並向所有持有G系列優先股的人發出通知。

 

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G 系列優先股持有人可享股息如下 10每年百分比，每月複合，將支付於以下 按持有人的期權按月欠款，(i) 現金，(ii) 以 G 系列額外股份的形式的「實物」 優先股（「PiK 股」），或 (iii) 其組合，在每個情況下，按照條款 G 系列優先股指定證書（「G 系列指定證書」）。發生時 並在觸發事件持續期間（如 G 系列指定證書中定義），G 系列優先股 將按照以下的利率累積股息 15每年百分比。轉換或贖回後，G 系列優先股的持有人亦為 有權領取股息，即全額支付。G 系列優先股持有人將有權與持有人一起投票 以轉換為基準的普通股，以及每位 G 系列優先股持有人可獲得的投票數 假設轉換價格為 $ 計算2.253 每股，即最低價格（根據《規則》第 5635 條所定義 納斯達克股票市場）在執行和交付 G 系列購買協議之前立即適用，但在某些情況下 G 系列指定證書中所述的實益所有權限制。截至九月三十日止的三個月內， 2024 年及 2023 年，公司錄得股息總額為 $288,068 和 $0，分別報告為 F 系列優先股 簡明綜合綜合損失報表的股息。截至二零二四年九月三十日及二零二三年九月三十日止九個月內， 公司錄得股息總計 $325,213 和 $0，分別報告為 G 系列優先股息（簡明） 綜合損失報表。

 

儘管上述事項，公司使用普通股支付轉換和股息補償支付的能力，受到Series G指定書中的某些限制。此外，Series G指定書中還包含某項有益所有權限制，適用於除PharmaCyte Biotech, Inc.外的每位Series G投資者，在發行普通股可轉讓的Series G優先股或根據Series G指定書進行任何股息補償支付後。

 

2024年6月17日，本公司與必要持有人（定義於G系列指定證書中）訂立了一份修正協議（「G系列修正」）。根據G系列修正，必要持有人同意藉由提交一份修正證書（「G系列修正證書」）給特拉華州州書記（「州書記」），修改G系列指定證書，以增加G系列優先股認股權授權股份的數量。 8,950 年逐年獲得 12,826,273為了授權足夠數量的G系列優先股份用於支付PIk股份，本公司於2024年6月17日向州書記提交了G系列修正證書，從而修正了G系列指定證書。G系列修正證書生效後已提交給州書記。

 

所有板塊 G 優先股作為暫時性權益，持有人有權要求公司贖回其股份中的全部或部分現金，當普通股由於交易暫停或未能在符合資格的市場上連續五（5）個交易日交易或上市（視情況而定）。 G 優先股不是無條件可贖回的，只有在持有人選擇在此交易暫停或失敗時，才會有條件地可贖回。這不被認為在公司控制範圍內。

 

在發行日，系列G優先股的估計公平價值約為$22.3 百萬，是通過蒙特卡羅模擬確定的。 約為$百萬的認股權公平價值是通過使用Black Scholes模型確定的。 認股權的總公平價值超過交易的總毛收入，因為認股權是處於實質當中。14.1 已發行。

 

該 約$9.0 由於毛收益與系列G優先股票的分配剩餘公允價值（即$0）之間的差異，產生的百萬股票折扣（對應優先股票）作為優先股票的帳面價值的減少進行會計處理，並且在根據ASC 480-10-S99-3A發生贖回可能性之前不會增值。

 

由於隨後必須以公允價值衡量的負債的公允價值超過所收取的淨收益，因此公允價值超過淨收益的部分被認列為盈餘損失。因此，公司認列了發行優先股的損失，金額約為$5.1 百萬元。

 

於2024年8月8日，公司與所需持有人（定義見G順位證書）訂立了修正協議（「8月G順位修正」）。根據8月G順位修正，所需持有人同意通過提交修正證書（「8月G順位修正證書」）來修改G順位證書，以調整PIk股份的計算。於2024年8月8日，公司向州書記處提交了8月G順位修正證書，從而修改了G順位證書。8月G順位修正證書於提交後即生效。

 

14
 

 

G系列認股權

 

G優先股被認定更像是一種債務型基金，而不是股權型基金。公司確認了以下不明確且與債務基金不緊密相關的內含特徵：1）在條件贖回事件發生時提供补偿利息，2）在轉換事件發生時提供补偿利息，3）在發生股權條件失敗時（如F系列指定設計說明書中定義的那樣）提供分期贖回，以及4）變數股份結算分期轉換。這些特徵被捆綁在一起，並且被賦予可能受影響的概率並根據公平價值評估。這些特徵的公平價值變動後在綜合損益表中被承認。公司在發行時估計了分解內含衍生品的公平價值為$3,149,800 使用Monte Carlo模擬模型估計分解內含衍生品的公平價值，並使用以下輸入數據：我們普通股的公平價值為$1.90 ，估計的股權波動率為 120.0%，估計的交易量波動率為 190.0%，到期時間為 1.35 年，折現市場利率為 6.8%，股息率為 10.0%，罰息率為 15.0%，以及違約機率。 0.5分拆衍生負債的公平價值是利用有和沒有方法來估算的，該方法使用具有衍生品的情景和沒有衍生品的普通到期情景之間的機率加權差異。

 

根據 至 G 系列私募股權證，公司發行給投資者 (i) 購買 G 系列長期認股權證 4,928,416 股份 普通股，行使價為 $1.816 每股（可調整），由發行日起計五年 及 (ii) 購買 G 系列短期認股權證 4,928,416 普通股股份，行使價為每股 1.816 美元（主題為主旨 調整），由發行日起計十八個月內。

 

對於第G系列認股權的行使價格和可按第G系列認股權行使而發行的股份數量，應按照送轉、拆股並股、重分類等慣例進行調整，並且在普通股價格下調整的基礎上進行「全部套息保護」方式的價格調整，以避免因以低於當時適用的行使價格向普通股或可轉換、可行使或可交換為普通股的證券發行而進行調整（受到某些例外條件的限制）。在任何此類基於價格的調整後，可按第G系列認股權行使而發行的股份數量將按比例增加。

 

於2024年8月16日，本公司與G系列投資者簽訂了（i）一份修訂協議（“G系列長期認股權修訂”），該協議自2024年6月30日生效，涉及G系列長期認股權；以及（ii）一份修訂協議（“G系列短期認股權修訂”），連同G系列長期認股權修訂合稱為“G系列認股權修訂”），與G系列投資者自2024年6月30日生效，涉及G系列短期認股權。G系列認股權修訂修改了與G系列認股權持有人的權利有關的某些條款，規定在公司管理範圍之外的基本交易中（如G系列認股權所定義），包括未經公司董事會批准的基本交易時，G系列認股權持有人僅有權從公司或任何繼承實體處接收未行使部分的G系列認股權的Black Scholes Value（如G系列認股權所定義），而這與處於該基本交易中的公司普通股持有人提供和支付的相同類型或形式的考慮方法（以及比例相同）相同，不論該考慮方法是現金、股票或任何組合，或者是否公司普通股持有人被要求在基本交易中選擇從可替代的考慮方式中接收；此外，如果公司的普通股持有人在該基本交易中未被提供或支付任何考慮，則這些公司的普通股持有人將被視為已收到後繼實體的普通股（該後繼實體可能是在該基本交易後成為公司）。此外，G系列認股權修訂修改了與Black Scholes Value相關的Black Scholes值的定義，該值現在是預期波動性，等於60日波動性，從Bloomberg的“HVT”功能獲取（使用365日的年化因子確定）的預期波動性，作為最早發生的（1）適用基本交易的公開披露和（2）持有者請求的日期之後的交易日的預期波動性。修改導致G系列認股權的重新分類，因為它們不再適用於ASC 815的範圍。根據ASC 815-40，公司於2024年7月25日重新評估了G系列認股權的公平價值（$12,343,000），並將$的公平價值變動識別為非現金虧損，並於2024年7月25日將G系列認股權重新分類為股本溢價。11,000 截至2024年9月30日的九個月，公司對$的公平價值變動認列了非現金收益。1,716,000.

 

註冊權利協議

 

關於系列F-1定向增發， 公司與系列F-1投資者簽訂了註冊權利協議（“系列F-1註冊權利協議”），根據該協議，公司同意向美國證券交易委員會提交一份轉售註冊聲明（“系列F-1註冊聲明”），以註冊轉售（A）200%的系列F-1轉換股份和（B）200%的系列F-1認股權證股份，該聲明將在最遲不超過關閉日期後的30個日歷天內及時提交，並在有效截止日期前（如系列F-1註冊權利協議中定義）使系列F-1註冊聲明生效。

 

In connection with the Series G Private Placement, the Company entered into a Registration Rights Agreement with the Series G Investors (the “Series G Registration Rights Agreement” and, together with the Series F-1 Registration Rights Agreement, the “Registration Rights Agreements”) pursuant to which the Company agreed to file a resale registration statement (the “Series G Registration Statement”) with the SEC to register for resale (A) 200% of the Series G Conversion Shares, (B) 200% of the shares of Common Stock issuable upon conversion of the PIK Shares, and (C) 200% of the Series G Warrant Shares promptly following the Closing Date, but in no event later than 30 calendar days after the Closing Date, and to have such Series G Registration Statement declared effective by the Effectiveness Deadline (as defined in the Series G Registration Rights Agreement).

 

In connection with the Registration Rights Agreements, the Company filed a registration statement on Form S-3 covering such securities, which registration statement was filed on June 21, 2024, amended on August 8, 2024 and declared effective by the SEC on August 12, 2024. Under the Series F-1 Registration Rights Agreement, the Company is obligated to pay certain liquidated damages to the Series F-1 Investors if the Company, among other things, failed to file the Series F-1 Registration Statement when required, failed to file or cause the Series F-1 Registration Statement to be declared effective by the SEC when required, or fails to maintain the effectiveness of the Series F-1 Registration Statement.

 

15
 

 

Private Placement Warrants

 

In connection with the Private Placements, pursuant to (A) an engagement letter (the “GPN Agreement”) with GP Nurmenkari Inc. (“GPN”) and (B) an engagement letter (the “Palladium Agreement,” and collectively with the GPN Agreement, the “Engagement Letters”) with Palladium Capital Group, LLC (“Palladium,” and collectively with GPN, the “Placement Agents”), the Company engaged the Placement Agents to act as non-exclusive placement agents in connection with each Private Placement, pursuant to which, the Company agreed to (i) pay the Placement Agents a cash fee equal to 3% of the gross proceeds of each Private Placement (including any cash proceeds realized by the Company from the exercise of the Series F Warrants), (ii) reimbursement and payment of certain expenses, and (iii) issue to the Placement Agents on the Closing Date, warrants to purchase up to an aggregate of 693,833 of shares of Common Stock to each Placement Agent, which is equal to 3% of the aggregate number of shares of Common Stock underlying the securities issued in each Private Placement, including upon exercise of any Series F Warrants, with terms identical to the Series G Long-Term Warrants and Series F-1 Long-Term Warrants.

 

Nasdaq Stockholder Approval

 

The Company’s ability to issue Series F-1 Conversion Shares and Series G Conversion Shares and Series F-1 Warrant Shares and Series G Warrant Shares using shares of Common Stock is subject to certain limitations set forth in the Series F-1 Certificate of Designations and Series G Certificate of Designations, as applicable. Prior to the Nasdaq Stockholder Approval (as defined below), such limitations included a limit on the number of shares that could be issued until the time that the Company’s stockholders have approved the issuance of more than 19.99% of the Company’s outstanding shares of Common Stock in accordance with the rules of the Nasdaq Stock Market. Each Purchase Agreement requires the Company to hold a meeting of its stockholders no later than August 1, 2024, to seek approval (the “Stockholder Approval”) (i) under Nasdaq Stock Market Rule 5635(d) for the issuance of shares of Common Stock in excess of 19.99% of the Company’s issued and outstanding shares of Common Stock at prices below the “Minimum Price” (as defined in Rule 5635 of the Rules of the Nasdaq Stock Market) on the date of the applicable Purchase Agreement pursuant to the terms of the Series F-1 Preferred Shares and Series G Preferred Shares, as applicable, and the Series G Warrants and Series F-1 Warrants, as applicable, and (ii) to increase the number of authorized shares of the Company to ensure that the number of authorized shares of Common Stock is sufficient to meet the Required Reserve Amount (as defined in the Purchase Agreements) pursuant to the terms of each Purchase Agreement. The Company received the Nasdaq Stockholder Approval at a special meeting of stockholders held on July 24, 2024.

 

Executive Officer Contract Amendments and Separations

 

Effective November 13, 2023, the Company entered into an amendment to the employment agreement of Dr. Chris Chapman, its President and Chief Medical Officer, providing for Dr. Chapman’s annual base salary to be adjusted from five hundred thousand dollars ($500,000) (the “Full Base Salary”) to two hundred fifty thousand dollars ($250,000) in cash per annum, until payment of his Full Base Salary would no longer jeopardize the Company’s ability to continue as a going concern, as determined by the Company in its sole discretion. The amendment further provides that the remaining $250,000 of base salary per annum (the “Deferral Amount”) shall be deferred until payment of the Deferral Amount would no longer jeopardize the Company’s ability to continue as a going concern, as determined by the Company in its sole discretion, at which time the Deferral Amount may be paid, at Dr. Chapman’s election, in shares of Common Stock or in cash. As of September 30, 2024 and December 31, 2023, the Company had recognized a salary deferral of $149,038 and $28,846, respectively, which was paid to Dr. Chapman on June 27, 2024.

 

Dr. Chapman’s employment agreement terminated on June 14, 2024. Pursuant to a General Release and Severance Agreement (the “Separation Agreement”), dated as of June 14, 2024, Dr. Chapman is entitled to (i) payment in the amount of $125,000, less all lawful and authorized withholdings and deductions, to be paid in three (3) equal monthly installments, (ii) a one-time payment equal to $25,000, less all lawful and authorized withholdings and deductions, (iii) reimbursement for continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) for a period of up to three (3) months, and (iv) acceleration of certain unvested options granted to Dr. Chapman pursuant to those certain Nonqualified Stock Option Agreements, dated April 4, 2023 and June 7, 2023. The Company recognized $0 and $150,000 of salary expense and $0 and $197,427 of stock-based compensation during the three and nine months ended September 30, 2024, respectively, which is included in the Condensed Consolidated Statement of Comprehensive Loss.

 

16
 

 

In connection with an overall reduction in compensation paid to the Company’s directors implemented in November 2023, effective November 13, 2023, the Company entered into an amendment to the employment agreement of Christopher C. Schreiber, a Director and the Company’s former Executive Chairman, providing for Mr. Schreiber’s annual fee to be adjusted from three hundred thousand dollars ($300,000) (the “Full Fee”) to sixty thousand dollars ($60,000) in cash per annum, until payment of his Full Fee would no longer jeopardize the Company’s ability to continue as a going concern, as determined by the Company in its sole discretion. The amendment further provides that the remaining $240,000 of the fees per annum (the “Fee Deferral Amount”) shall be deferred until payment of the Fee Deferral Amount would no longer jeopardize the Company’s ability to continue as a going concern, as determined by the Company in its sole discretion, at which time the Fee Deferral Amount may be paid, at Mr. Schreiber’s election, in shares of Common Stock or in cash. The amendment also clarified that Mr. Schreiber’s title is “Director.” As of September 30, 2024 and December 31, 2023, the Company had recognized a salary deferral of $175,385 and $27,692, respectively, which was paid to Mr. Schreiber on August 22, 2024.

 

Effective November 13, 2023, the Company entered into an amendment to the employment agreement of Dr. Adam Kaplin, its Chief Scientific Officer, providing that Dr. Kaplin’s employment and had an initial term of four months, which the parties had the option to mutually agree to extend for additional consecutive terms of one month each. The amendment further provided that, in the event of termination without cause by the Company prior to the end of the initial term, Dr. Kaplin shall receive his monthly base salary through the end of the initial term. The amendment further provided that all outstanding and unvested shares granted pursuant to the Nonqualified Stock Option Agreement, dated June 7, 2023, between the Company and Dr. Kaplin shall accelerate upon the termination of Dr. Kaplin’s employment. Dr. Kaplin’s amendment further provided that, in the event of a termination for any reason prior to the end of the first renewal term following the end of the initial term, the Company will continue to cover the costs of Dr. Kaplin’s health insurance coverage through the end of the first renewal term, subject to the execution and timely return of a release. Dr. Kaplin’s employment was terminated effective April 15, 2024.

 

Effective November 13, 2023, the Company entered into a mutual employment separation agreement with Paul M. Rivard, its Chief Legal Officer. The separation agreement provides for a lump-sum severance payment equal to three months of his normal base salary in exchange for a waiver and release. The separation agreement further provides that Mr. Rivard will be deemed a contractor providing services to the Company for purposes of any awards previously granted to him under the 2021 Plan if at the relevant time(s) he is providing services to the Company while under the employ of a law firm representing the Company.

 

Director’s Deferral of Board Service Fees

 

On November 13, 2023, the Board approved certain adjustments to the director fees. Mr. Silverman’s fees were decreased from $216,000 to $60,000 annually, with payment of the excess amount of $156,000 deferred until the date that payment of such amount would no longer jeopardize the Company’s ability to continue as a going concern, as determined by the Company in its sole discretion, at which time such amount may be paid, at Mr. Silverman’s election, in shares of Common Stock or in cash. Messrs. Eagle’s, Uzonwanne’s and White’s fees were decreased from $96,000 to $60,000 annually, with payment of the excess amounts of $36,000 per director deferred until the date that payment of such amounts would no longer jeopardize the Company’s ability to continue as a going concern, as determined by the Company in its sole discretion, at which time such amounts may be paid, at each director’s election, in shares of Common Stock or in cash. Upon their appointment to the Board, Messrs. Friscia and Glass were also subject to this deferral. As of September 30, 2024 and December 31, 2023, the Company had recognized a board fee deferral of $209,800 and $44,000, respectively, which was paid to the respective Board member on August 21, 2024.

 

17
 

 

Note 2 – Significant Accounting Policies

 

(a) Basis of Presentation

 

The condensed consolidated financial statements of the Company are prepared in U.S. Dollars and in accordance with accounting principles generally accepted in the United States of America (US GAAP).

 

The accompanying unaudited condensed financial statements have been prepared by the Company. These statements include all adjustments (consisting only of normal recurring adjustments) which management believes necessary for a fair presentation of the statements and have been prepared on a consistent basis using the accounting policies described in Note 2 Significant Accounting Policies included in the Notes to Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the Securities and Exchange Commission on April 1, 2024 (the “2023 Annual Report”). Certain financial information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the accompanying disclosures are adequate to make the information presented not misleading. The Notes to Financial Statements included in the 2023 Annual Report should be read in conjunction with the accompanying interim financial statements. The interim operating results for the three and nine months ended September 30, 2024 may not be necessarily indicative of the operating results expected for the full year or any future period.

 

(b) Use of Estimates and Judgments

 

The preparation of financial statements in conformity with US GAAP requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Information about significant areas of estimation, uncertainty and critical judgments in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements is included in the following notes for recording the fair value of financial instruments, derivative financial instruments valuations, research and development expenses, impairment of intangible assets and the valuation of share-based payments.

 

(c) Functional and Presentation Currency

 

These condensed consolidated financial statements are presented in U.S. Dollars, which is the Company’s functional currency. All financial information has been rounded to the nearest dollar. Foreign Currency Transaction Gains or Losses, resulting from cash balances denominated in Foreign Currencies, are recorded in the Condensed Consolidated Statements of Comprehensive Loss.

 

18
 

 

(d) Comprehensive Income (Loss)

 

The Company follows Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) 220 in reporting comprehensive income. Comprehensive income (loss) is a more inclusive financial reporting methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income (loss). Since the Company has no items of other comprehensive income (loss), comprehensive loss is equal to net loss.

 

(e) Cash and Cash Equivalents

 

The Company considers all highly liquid investments, which include short-term bank deposits (up to three months from date of deposit) that are not restricted as to withdrawal date or use, to be cash equivalents.

 

(f) Fair Value of Financial Instruments

 

Fair value measurements discussed herein are based upon certain market assumptions and pertinent information available to management as of and during the three and nine months ended September 30, 2024. The carrying amounts of cash equivalents, accounts receivable, other current assets, other assets, accounts payable, and accrued expenses approximated their fair values as of September 30, 2024 due to their short-term nature. The fair value of the bifurcated embedded derivative related to the convertible preferred stock was estimated using a Monte Carlo simulation model, which uses as inputs the fair value of the Company’s Common Stock and estimates for the equity volatility and traded volume volatility of the Company’s Common Stock, the time to maturity of the convertible preferred stock, the risk-free interest rate for a period that approximates the time to maturity, dividend rate, a penalty dividend rate, and the probability of default. The fair value of the warrant liabilities was estimated using the Black Scholes Model which uses as inputs the following weighted average assumptions: dividend yield, expected term in years; equity volatility; and risk-free interest rate.

 

Fair Value Measurement

 

The framework for measuring fair value provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under FASB ASC 820 are described as follows:

 

  Level 1 Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the Company can access.
     
  Level 2 Inputs to the valuation methodology include:

 

  ● quoted prices for similar assets or liabilities in active markets;
  ● quoted prices for identical or similar assets or liabilities in inactive markets;
  ● inputs other than quoted prices that are observable for the asset or liability;
  ● inputs that are derived principally from or corroborated by observable market data by correlation or other means

 

    If the asset or liability has a specified (contractual) term, the level 2 input must be observable for substantially the full term of the asset or liability.
     
  Level 3 Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

 

The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Valuation techniques maximize the use of relevant observable inputs and minimize the use of unobservable inputs.

 

19
 

 

(f) Fair Value of Financial Instruments, continued

 

The following is a description of the valuation methodologies used for assets measured at fair value as of September 30, 2024 and December 31, 2023.

 

Marketable Securities: Valued using quoted prices in active markets for identical assets.

 

   

Quoted Prices

in Active

Markets for

Identical Assets

or Liabilities

(Level 1)

  

Quoted Prices

for Similar

Assets or

Liabilities in

Active Markets

(Level 2)

  

Significant

Unobservable

Inputs

(Level 3)

 
Marketable securities at September 30, 2024  $9,449,483   $-   $- 
                
Marketable securities at December 31, 2023  $2,242,106   $-   $- 

 

Marketable securities are classified as available for sale and are valued at fair market value.

 

As of September 30, 2024 and December 31, 2023, the Company held certain mutual funds, which, under FASB ASC 321-10, were considered equity investments. As such, the change in fair value in the three months ended September 30, 2024 and 2023 was a gain of $4,746 and a gain of $2,324, respectively. The change in fair value in the nine months ended September 30, 2024 and 2023 was a gain of $3,771 and a loss of $371, respectively.

 

Gains and losses resulting from the sales of marketable securities were gain of $551 and a loss of $500 for the three months ended September 30, 2024 and 2023, respectively.

 

Gains and losses resulting from the sales of marketable securities were gains of $651 and loss of $714 for the nine months ended September 30, 2024 and 2023, respectively.

 

Proceeds from the sales of marketable securities in the nine months ended September 30, 2024 and 2023 were $5,500,450 and $9,250,000, respectively.

 

20
 

 

Fair Value on a Recurring Basis

 

The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The estimated fair value of the warrant liabilities and bifurcated embedded derivatives represent Level 3 measurements. The following table presents information about the Company’s liabilities that are measured at fair value on a recurring basis as of September 30, 2024 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

 

Description  Level   September 30,2024 
Liabilities:          
Warrant liabilities (Note 1)   3   $- 
Derivative liabilities (Note 1)   3   $1,282,000 

 

Description  Level   December 31, 2023 
Liabilities:          
Warrant liabilities (Note 3)   3   $867,000 
Derivative liabilities (Note 3)   3   $61,000 

 

The following table sets forth a summary of the change in the fair value of the warrant liabilities that is measured at fair value on a recurring basis for the nine months ended September 30, 2024:

 

Balance on December 31, 2023  $867,000 
Issuance of warrants reported at fair value   21,992,000 
Change in fair value of warrant liabilities   4,410,000 
Reclassification of warrant liability to equity upon warrant modification   (27,269,000)
Balance on September 30, 2024  $- 

 

The following table sets forth a summary of the change in the fair value of the derivative liabilities that is measured at fair value on a recurring basis for the nine months ended September 30, 2024:

 

Balance on December 31, 2023  $61,000 
Issuance of convertible preferred stock with derivative liabilities   854,000 
Change in fair value of derivative liabilities   367,000 
Balance on September 30, 2024  $1,282,000 

 

There were no assets or liabilities measured on a non-recurring basis as of September 30, 2024 or December 31, 2023.

 

21
 

 

(g) Derivative Financial Instruments

 

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging.” If liability accounting is required, the Company’s derivative instruments are recorded at fair value at the issuance date and re-valued at each reporting date, with changes in the fair value reported in the statements of operations. Derivative assets and liabilities are classified on the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within twelve (12) months of the balance sheet date.

 

The Company has determined that the Series F Convertible Preferred Stock warrants are derivatives that are required to be accounted for as liabilities. The Company has also determined that the following embedded features in the preferred stock are not clearly and closely related to the debt host instrument: 1) make-whole interest upon a contingent redemption event, 2) make-whole interest upon a conversion event, 3) an installment redemption upon an Equity Conditions Failure (as defined in the Certificate of Designation), and 4) variable share-settled installment conversion and as such are bifurcated from the preferred stock and accounted for as liabilities. The fair value of the warrants and embedded features are estimated using internal valuation models. The Company’s valuation models utilize inputs and other assumptions and may not be reflective of the price at which they can be settled.

 

Warrants

 

The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815. The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own Common Stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

 

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be liability classified and recorded at their initial fair value on the date of issuance and remeasured at fair value and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the Statements of Comprehensive Income (Loss).

 

Modification of warrants

 

The Company applies the guidance in ASC 815-40 to account for warrants that are liability classified that are subsequently modified resulting in a reclassification to equity. The warrants are remeasured at fair value on the modification date, the change in fair value is recognized as a non-cash gain or loss on the Statement of Comprehensive Income (Loss), and the warrants are reclassified to additional paid-in capital.

 

(h) Prepaid Expenses

 

Prepaid expenses represent expenses paid prior to the date that the related services are rendered or used are comprised principally of prepaid insurance and research and development expenses.

 

(i) Concentrations

 

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash on deposit with financial institutions and accounts receivable. At times, the Company’s cash in banks exceeds the FDIC insurance limit. The Company has not experienced any loss because of these cash deposits. These cash balances are maintained with two banks as of September 30, 2024.

 

(j) Risk Management of Cash and Investments

 

It is the Company’s policy to minimize the Company’s capital resources to investment risks, prioritizing the preservation of capital over investment returns. Investments are maintained in securities, primarily publicly traded, short-term money market funds based on highly rated federal, state and corporate bonds, that minimize the risk to the Company’s capital resources and provide ready access to funds.

 

The Company’s investment portfolios are regularly monitored for risk and are held with one brokerage firm.

 

22
 

 

(k) Investments

 

Investments recorded using the cost method will be assessed for any decrease in value that has occurred that is other than temporary and the other than temporary decrease in value shall be recognized. As and when circumstances and facts change, the Company will evaluate the Company’s ability to significantly influence operational and financial policy to establish a basis for converting the investment accounted for using the cost method to the equity method of valuation in accordance with FASB ASC 323.

 

In accordance with FASB ASC 323, the Company recognizes investments in joint ventures based upon the Company’s ability to significantly influence the operational or financial policies of the joint venture. An objective judgment of the level of influence is made at the time of the investment based upon several factors including, but not limited to the following:

 

  a) Representation on the Board of Directors
  b) Participation in policy-making processes
  c) Material intra-entity transactions
  d) Interchange of management personnel
  e) Technological dependencies
  f) Extent of ownership and the ability to influence decision making based upon the makeup of other owners when the shareholder group is small.

 

The Company follows the equity method for valuating investments in joint ventures when the existence of significant influence over operational and financial policy has been established, as determined by management; otherwise, the Company will valuate these investments using the cost method.

 

In accordance with FASB ASC 321-10-35-2, the Company has elected to measure its investment in Oravax Medical, Inc. (“Oravax”) (Note 3) as an equity security without a readily determinable fair value. Under this election, an equity security without a readily available fair value is reflected at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. At each reporting period, the Company is required to make a qualitative assessment considering impairment indicators to evaluate whether the investment is impaired. If deemed impaired, the Company is required to estimate the fair value of the investment and recognize an impairment loss equal to the difference between the fair value of the investment and its carry amount. As of September 30, 2024, the Company performed a qualitative assessment to evaluate whether the investment is impaired and determined that the investment was not impaired and thus no adjustment to fair market value was required as of September 30, 2024.

 

(l) Property, Plant and Equipment

 

Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Costs include expenditures that are directly attributable to the acquisition of the asset.

 

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment and are recognized within “other (income)/expense” in the Condensed Consolidated Statements of Comprehensive Loss.

 

Depreciation is recognized over the estimated useful lives of the property, plant and equipment. Leased assets are depreciated over the shorter of the lease term or their useful lives.

 

The estimated useful lives for the current and comparative periods are as follows:

 

   Useful Life
   (in years)
Plant and equipment  5-12
Furniture and fixtures  5-10
Computer equipment & software  3-5
Leasehold Improvements  Shorter of the remaining lease or estimated useful life

 

Depreciation methods, useful lives and residual values are reviewed at each reporting date.

 

(m) Intangible Assets

 

The Company’s long-lived intangible assets, other than goodwill, are assessed for impairment when events or circumstances indicate there may be an impairment. These assets were initially recorded at their estimated fair value at the time of acquisition and assets not acquired in acquisitions were recorded at historical cost. However, if their estimated fair value is less than the carrying amount, other intangible assets with indefinite lives are reduced to their estimated fair value through an impairment charge in the Condensed Consolidated Statements of Comprehensive Loss.

 

23
 

 

Patents and Trade Secrets

 

Propriety protection for the Company’s products, technology and process is important to its competitive position. As of September 30, 2024, the Company has 18 issued U.S. patents, 69 foreign patents, 1 pending U.S. patent applications and 7 foreign patent applications pending in such jurisdictions as Australia, Canada, China, European Union, Israel, Japan and South Korea, which if issued are expected to expire between 2036 and 2041. Management intends to protect all other intellectual property (e.g. copyrights, trademarks, and trade secrets) using all legal remedies available to the Company.

 

The Company records expenses related to the application for and maintenance of patents as a component of research and development expenses on the Condensed Consolidated Statement of Comprehensive Loss.

 

Patent Costs

 

Patents may be purchased from third parties. The costs of acquiring the patent are capitalized as patent costs if it represents a future economic benefit to the Company. Once a patent is acquired it is amortized over its remaining useful life and assessed for impairment when necessary.

 

Other Intangible Assets

 

Other intangible assets that are acquired by the Company, which have definite useful lives, are measured at cost less accumulated amortization and accumulated impairment losses.

 

Amortization

 

Amortization is recognized on a straight-line basis over the estimated useful lives of intangible assets, other than goodwill, from the date that they are available for use. The estimated useful lives for the current and comparative periods are as follows:

 

    Useful Life
    (in years)
Patents and trademarks   12-17

 

(n) Goodwill

 

Goodwill is evaluated annually for impairment or whenever we identify certain triggering events or circumstances that would more likely than not reduce the fair value below its carrying amount. Events or circumstances that might indicate an interim evaluation is warranted include, among other things, unexpected adverse business conditions, economic factors (for example, the loss of key personnel), supply costs, unanticipated competitive activities, and acts by governments and courts.

 

(o) Recoverability of Long-Lived Assets

 

In accordance with FASB ASC 360-10-35 “Impairment or Disposal of Long-lived Assets”, long-lived assets to be held and used are analyzed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable or that the useful lives of those assets are no longer appropriate. The Company evaluates at each balance sheet date whether events and circumstances have occurred that indicate possible impairment.

 

24
 

 

The Company determines the existence of such impairment by measuring the expected future cash flows (undiscounted and without interest charges) and comparing such amount to the carrying amount of the assets. An impairment loss, if one exists, is then measured as the amount by which the carrying amount of the asset exceeds the discounted estimated future cash flows. Assets to be disposed of are reported at the lower of the carrying amount or fair value of such assets less costs to sell. Asset impairment charges are recorded to reduce the carrying amount of the long-lived asset that will be sold or disposed of to their estimated fair values. Charges for the asset impairment reduce the carrying amount of the long-lived assets to their estimated salvage value in connection with the decision to dispose of such assets.

 

(p) Right-of-Use Assets

 

The Company leased a facility in Baltimore, Maryland (“2021 Wolfe St”) under an operating lease (“2021 Baltimore Lease”) with annual rentals of $52,800 to $56,016 plus certain operating expenses. The 2021 Baltimore Lease took effect on November 17, 2021, for a term of 12 months with automatic renewals unless a sixty-day notice is provided. The initial term expired on November 30, 2022. The lease renewed effective December 1, 2022 for a term of 12 months with automatic renewals unless a sixty-day notice is provided. The 2021 Baltimore Lease was terminated by the lessor on April 30, 2024.

 

The Company leased a facility in Tampa, Florida (“Platt St”) under an operating lease (“Platt Street Lease”) with annual rentals of $22,030 to $23,259 plus certain operating expenses. The Platt Street Lease took effect on April 1, 2022 for a term of 36 months. The Platt Street Lease was cancelled without penalty effective October 31, 2023.

 

The Company leased a facility in Baltimore, Maryland (“2024 Wolfe St”) under an operating lease (“2024 Baltimore Lease”) with annual rentals of $32,400 plus certain operating expenses. The 2024 Baltimore Lease took effect on May 1, 2024, for a term of 12 months with automatic renewals unless a sixty-day notice is provided.

 

25
 

 

In accordance with FASB ASC, Topic 842, Leases (“ASC 842”), which increases transparency and comparability by recognizing a lessee’s rights and obligations resulting from leases by recording them on the balance sheet as lease assets and lease liabilities. The guidance requires the recognition of the right-of-use (“ROU”) assets and related operating and finance lease liabilities on the balance sheet.

 

The Company utilizes the package of practical expedients permitted within the standard, which allows an entity to forgo reassessing (i) whether a contract contains a lease, (ii) classification of leases, and (iii) whether capitalized costs associated with a lease meet the definition of initial direct costs. Also, the Company elected the expedient allowing an entity to use hindsight to determine the lease term and impairment of ROU assets and the expedient to allow the Company to not have to separate lease and non-lease components. The Company has also elected the short-term lease accounting policy under which the Company would not recognize a lease liability or ROU asset for any lease that at the commencement date has a lease term of twelve months or less and does not include a purchase option that the Company is more than reasonably certain to exercise.

 

For operating leases, the lease liability is initially and subsequently measured at the present value of the unpaid lease payments. The Company generally uses its incremental borrowing rate as the discount rate for leases, unless an interest rate is implicitly stated in the lease. The present value of the lease payments is calculated using the incremental borrowing rate for operating leases, which was determined using a portfolio approach based on the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. The lease term for all the Company’s leases includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend the lease that the Company is reasonably certain to exercise, or an option to extend the lease controlled by the lessor. All ROU assets are reviewed for impairment.

 

Lease expense for operating leases consists of the lease payments plus any initial direct costs and is recognized on a straight-line basis over the lease term.

 

The Company’s operating leases are comprised of the 2024 Baltimore Lease, the 2021 Baltimore Lease and the Platt Street Lease on the Condensed Consolidated Balance Sheets. The information related to these leases are presented below:

 

Balance Sheet Location  Lease   Lease   Lease   Total   Lease   Lease   Total 
   As of September 30, 2024   As of December 31, 2023 
   Platt Street   2021 Baltimore   2024 Baltimore       Platt Street   2021 Baltimore     
Balance Sheet Location  Lease   Lease   Lease   Total   Lease   Lease   Total 
Operating Lease                                   
Lease Right of Use  $-   $-   $18,285   $18,285   $-   $47,389   $47,389 
Lease Payable, current   -    -    18,285    18,285    -    48,870    48,870 
Lease Payable - net of current   -    -    -    -    -    -    - 

 

The following provides details of the Company’s lease expense:

 

Lease Expenses  Lease   Lease   Lease   Total   Lease   Lease   Total 
  

For the Three Months Ended

September 30, 2024

   For the Three Months Ended September 30, 2023 
   Platt Street   2021 Baltimore   2024 Baltimore       Platt Street   2021 Baltimore     
Lease Expenses  Lease   Lease   Lease   Total   Lease   Lease   Total 
Operating Leases                                   
Lease Costs  $-   $-   $8,100   $8,100   $1,887   $13,600   $15,487 

 

Lease Expenses  Lease   Lease   Lease   Total   Lease   Lease   Total 
  

For the Nine Months Ended

September 30, 2024

  

For the Nine Months Ended

September 30, 2023

 
   Platt Street   2021 Baltimore   2024 Baltimore       Platt Street   2021 Baltimore     
Lease Expenses  Lease   Lease   Lease   Total   Lease   Lease   Total 
Operating Leases                                   
Lease Costs  $-   $18,672   $13,500   $32,172   $18,868   $54,400   $73,268 

 

26
 

 

Other information as of September 30, 2024 related to leases is presented below:

 

  

Platt

Street

   2021 Baltimore   2024 Baltimore     
Other Information  Lease   Lease   Lease   Total 
Operating Leases                    
Operating cash used  $-   $18,672   $13,500   $32,172 
Average remaining lease term   -    -    7    7 
Average discount rate   10.0%   10.0%   10.0%   10.0%

 

As of September 30, 2024, the annual minimum lease payments of the Company’s operating lease liabilities were as follows:

 

  

Platt

Street

  

2021

Baltimore

   2024 Baltimore     
   Lease   Lease   Lease   Total 
For Years Ending December 31,                    
2024   -    -   $8,100   $8,100 
2025   -    -    10,800    10,800 
Total future minimum lease payments, undiscounted  $-   $-   $18,900   $18,900 
Less: Imputed interest   -    -    615    615 
Present value of future minimum lease payments  $-   $-   $18,285   $18,285 

 

(q) Revenue Recognition

 

The Company will recognize revenue under ASC 606, Revenue from Contracts with Customers. The core principle of the revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods and services transferred to the customer. The following five steps are applied to achieve that core principle:

 

  1) Identify the contract with the customer
  2) Identify the performance obligations in the contract
  3) Determine the transaction price
  4) Allocate the transaction price to the performance obligations in the contract
  5) Recognize revenue when the company satisfies a performance obligation

 

(r) Income Taxes

 

The Company utilizes an asset and liability approach for financial accounting and reporting for income taxes. The provision for income taxes is based upon income or loss after adjustment for those permanent items that are not considered in the determination of taxable income. Deferred income taxes represent the tax effects of differences between the financial reporting and tax basis of the Company’s assets and liabilities at the enacted tax rates in effect for the years in which the differences are expected to reverse.

 

The Company evaluates the recoverability of deferred tax assets and establishes a valuation allowance when it is more likely than not that some portion or all the deferred tax assets will not be realized. Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In management’s opinion, adequate provisions for income taxes have been made. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary.

 

Tax benefits are recognized only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized upon settlement. A liability for “unrecognized tax benefits” is recorded for any tax benefits claimed in the Company’s tax returns that do not meet these recognition and measurement standards. As of September 30, 2024 and December 31, 2023, no liability for unrecognized tax benefits was required to be reported.

 

27
 

 

There was no income tax benefit recorded for the losses for the three and nine months ended September 30, 2024 and 2023 since management determined that the realization of the net deferred tax assets is not more likely than not to be realized and has recorded a full valuation allowance on the net deferred tax assets.

 

The Company’s policy for recording interest and penalties associated with tax audits is to record such items as a component of general and administrative expenses. There were no amounts accrued for penalties and interest for the three and nine months ended September 30, 2024 and 2023. The Company does not expect its uncertain tax position to change during the next twelve months. Management is currently unaware of any issues under review that could result in significant payments, accruals or material deviations from its position.

 

Tax years from 2020 through 2023 remain subject to examination by federal and state jurisdictions.

 

(s) Basic and Diluted Earnings per Share of Common Stock

 

Basic earnings per common share is based on the weighted average number of shares outstanding during the periods presented. Diluted earnings per share is computed using the weighted average number of common stock plus dilutive common share equivalents outstanding during the period. Potential common stock that would have the effect of increasing diluted earnings per share are considered anti-dilutive.

 

Diluted net loss per share is computed using the weighted average number of shares of Common Stock and dilutive potential Common Stock outstanding during the period.

 

The following table is a reconciliation of the weighted average number of shares outstanding used in calculating basic and diluted net income/(loss) per share for the three and nine months ended September 30, 2024 and 2023:

 

Schedule of Weighted Average Number of Shares Outstanding Earnings Per Share 

   2024   2023   2024   2023 
   For the Three Months Ended
September 30,		   For the Nine Months Ended
September 30,		 
   2024   2023   2024   2023 
Net (Loss)/Income Attributable to Common Stockholders – Basic and Diluted  $(2,680,443)  $2,884,943   $(24,025,339)  $(3,326,571)
                     
Weighted average shares outstanding – basic   2,415,089    1,564,275    2,290,962    1,456,327 
Dilutive shares                    
Stock Options   -    1,667    -    - 
Unvested Restricted Stock Units   -    -    -    - 
Warrants to purchase Common Stock   -    4,716,904    -    - 
Series C Convertible Preferred Stock Warrants   -    -    -    - 
Series D Convertible Preferred Stock   -    -    -    - 
Series F Convertible Preferred Stock   -    3,100,315    -    - 
Series F-1 Convertible Preferred Stock   -    -    -    - 
Series G Convertible Preferred Stock   -    -    -    - 
Weighted average shares outstanding - diluted   2,415,089    7,818,886    2,290,962    1,456,327 

 

As the Company reported a net loss for the three and nine months ended September 30, 2024 and the nine months ended September 30, 2023, Common Stock equivalents were anti-dilutive.

 

As of September 30, 2024 and 2023, the following securities are excluded from the calculation of weighted average dilutive common stock because their inclusion would have been anti-dilutive. For the three months ended September 30, 2023, although the Company reported net income, the following securities were out of the money and thus considered anti-dilutive.

 

   2024   2023                 
   For the Three Months Ended
September 30,		    For the Nine Months Ended
September 30,		  
   2024   2023    2024     2023  
Stock Options   86,061    45,619      86,061       47,286  
Unvested Restricted Stock Units   48,334    93,169      48,334       93,169  
Warrants to purchase Common Stock   23,895,139    216,718      23,895,139       4,933,622  
Series C Convertible Preferred Stock Warrants   918    918      918       918  
Series D Convertible Preferred Stock   1,217    1,217      1,217       1,217  

Series F Convertible Preferred Stock

   2,512,115    -      2,512,115       3,100,315  
Series F-1 Convertible Preferred Stock   2,780,837    -      2,780,837       -  
Series G Convertible Preferred Stock   4,928,414    -      4,926,244      

-

  
Total potentially dilutive shares   34,253,035    357,641      34,250,865       8,176,527  

 

(t) Stock-based Payments

 

The Company accounts for stock-based compensation under the provisions of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 718, “Compensation - Stock Compensation”, which requires the measurement and recognition of compensation expense for all stock-based awards made to employees and directors based on estimated fair values on the grant date. The Company estimates the fair value of stock-based awards on the date of grant using the Black-Scholes model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods using the straight-line method. In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718), Improvements to Nonemployee Share-Based Payment Accounting (the “2018 Update”). The amendments in the 2018 Update expand the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees. Prior to the 2018 Update, Topic 718 applied only to share-based transactions to employees. Consistent with the accounting requirement for employee share-based payment awards, nonemployee share-based payment awards within the scope of Topic 718 are measured at grant-date fair value of the equity instruments that an entity is obligated to issue when the good has been delivered or the service has been rendered and any other conditions necessary to earn the right to benefit from the instruments have been satisfied.

 

The Company has elected to account for forfeiture of stock-based awards as they occur.

 

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(u) Research and Development Costs

 

In accordance with FASB ASC 730, research and development costs are expensed as incurred and consist of fees paid to third parties that conduct certain research and development activities on the Company’s behalf.

 

(v) Recently Issued Accounting Pronouncements

 

As of September 30, 2024 and for the three and nine months then ended, there were no recently issued accounting pronouncements that had a material effect on the Company’s consolidated financial statements.

 

Note 3 –Liquidity and Management’s Plans

 

As of September 30, 2024, the Company’s cash on hand was $1,192,351 and marketable securities were $9,449,483. The Company has incurred a total net loss attributable to stockholders of $24,025,339 for the nine months ended September 30, 2024. As of September 30, 2024, the Company had working capital of $5,038,212 and stockholders’ equity of $16,777,343, including an accumulated deficit of $126,002,406. Since its inception, the Company has met its liquidity requirements principally through the sale of its Common Stock and Preferred Stock in public and private placements.

 

During the nine months ended September 30, 2024, the Company raised $12,487,399, net of offerings costs of $1,512,601, through the private placement of the Company’s Series F-1 Preferred Stock and Series G Preferred Stock and warrants to purchase shares of the Company’s Common Stock.

 

The Company evaluated the current cash requirements for operations in conjunction with management’s strategic plan and believes that the Company’s current financial resources as of the date of the issuance of these condensed consolidated financial statements are sufficient to fund its current operating budget and contractual obligations as of September 30, 2024 as they fall due within the next twelve-month period from the date of the issuance of these financial statements, alleviating any substantial doubt raised by the Company’s historical operating results and satisfying its estimated liquidity needs for twelve months from the issuance of these condensed consolidated financial statements.

 

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Note 4 – Trade and Other Payables

 

Trade and other payables consist of the following:

 

   September 30, 2024   December 31, 2023 
         
Accounts Payable – Trade  $3,705,127   $3,079,080 
Accrued Expenses   455,210    637,138 
Trade and other payables, Total  $4,160,337   $3,716,218 

 

Note 5 – Stock-based Payments

 

Equity incentive Plans

 

2013 Stock Incentive Plan

 

On January 23, 2014, the Company adopted the 2013 Incentive Stock and Award Plan, which was subsequently Amended and Restated on January 9, 2015 (as amended, the “2013 Plan”). The 2013 Plan was amended by the Board on September 30, 2016, and such amendment was ratified by the Company’s stockholders on December 7, 2018. The 2013 Plan provided for the issuance of up to 73 shares of the Company’s Common Stock. As of September 30, 2024, grants of restricted stock and options to purchase 54 shares of Common Stock have been issued pursuant to the 2013 Plan. In 2019, the 2013 Plan expired in accordance with its terms and no further awards have been or will be made under the 2013 Plan on or after such date. Any awards granted on or before such date will continue in accordance with the terms of the applicable award agreements and the 2013 Plan.

 

2016 Stock Incentive Plan

 

In 2016, pre-Merger MyMD Florida adopted the MyMD Pharmaceuticals, Inc. Amended and Restated 2016 Equity Incentive Plan (the “2016 Plan”). The 2016 Plan provided for the issuance of up to 50,000,000 shares of the Company’s Common Stock. As of September 30, 2024, no options were outstanding and no shares of Common Stock remain available for issuance under the 2016 Plan. Pursuant to the Merger Agreement, effective as of the effective time of the Merger, the Company assumed pre-Merger MyMD Florida’s Second Amendment to Amended and Restated 2016 Stock Incentive Plan (the pre-Merger MyMD Florida’s Second Amendment to Amended and Restated 2016 Incentive Plan together with the 2016 Plan, the “MyMD Florida Incentive Plan”), assuming all of pre-Merger MyMD Florida’s rights and obligations with respect to the options issued thereunder (except that the term of each options was amended to expire on the second-year anniversary of the effective time of closing). All such options expired on April 16, 2023.

 

2017 Stock Incentive Plan

 

On August 7, 2017, the Company’s stockholders approved, and the Company adopted the 2017 Stock Incentive Plan (“2017 Plan”). The 2017 Plan provides for the issuance of up to 118 shares of the Company’s Common Stock. As of September 30, 2024, grants of restricted stock and options to purchase 93 shares of Common Stock have been issued pursuant to the 2017 Plan, and 25 shares of Common Stock remain available for issuance.

 

2018 Stock Incentive Plan

 

On December 7, 2018, the Company’s stockholders approved, and the Company adopted the 2018 Stock Incentive Plan (“2018 Plan”). On August 27, 2020, the 2018 Plan was modified to increase the total authorized shares. The 2018 Plan, as amended, provides for the issuance of up to 18,670 shares of the Company’s Common Stock. As of September 30, 2024, grants of RSUs and restricted stock to purchase 8,769 shares of Common Stock have been issued pursuant to the 2018 Plan, and 9,901 shares of Common Stock remain available for issuance.

 

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2021 Stock Incentive Plan

 

On April 15, 2021, the Company’s stockholders approved, and the Company adopted the 2021 Stock Incentive Plan (“2021 Plan”). The 2021 Plan provides for the issuance of up to 240,940 shares of the Company’s Common Stock. As of September 30, 2024, grants of RSUs and stock options to purchase 150,816 shares of Common Stock have been issued pursuant to the 2021 Plan, and 90,124 shares of Common Stock remain available for issuance.

 

Stock Options

 

The following table summarizes the activities for the Company’s stock options for the nine months ended September 30, 2024:

 

               Weighted     
               Average     
       Weighted   Weighted   Remaining     
       Average   Average   Contractual   Aggregate 
   Number of   Exercise   Grant Date   Term   Intrinsic 
   Shares   Price   Fair Value   (years)   Value 
Balance at December 31, 2023   139,840   $46.09   $42.34    8.17   $- 
Granted   -    -    -    -    - 
Exercised   -    -    -    -    - 
Forfeited   (39,168)   32.50    30.54    8.62    - 
Canceled/Expired   -    -    -    -    - 
Balance at September 30, 2024   100,672   $51.38   $46.92    6.95   $- 
Exercisable as of September 30, 2024   86,061   $51.65   $46.89    6.66   $- 

 

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the closing stock price of $1.62 for the Company’s Common Stock on September 30, 2024 and the closing stock price of $7.77 for the Company’s Common Stock on December 31, 2023.

 

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During the three months ended September 30, 2024 and 2023, the Company recognized stock option expenses totaling $13,763 and $595,576, respectively. During the nine months ended September 30, 2024 and 2023, the Company recognized stock option expenses totaling $970,754 and $2,341,915, respectively.

 

The unamortized stock option expenses as of September 30, 2024 totaled $235,100.

 

Restricted Stock Units

 

On October 14, 2021, the Compensation Committee of the Board of Directors approved grants totaling 93,169 Restricted Stock Units to the Company’s six directors and seven key employees. Each RSU had a grant date fair value of $242.70 which will be amortized upon vesting into administrative expenses within the Consolidated Statement of Comprehensive Loss. Such RSUs were granted under the 2021 Plan. Vesting of each RSU is:

 

  ● One-third (33%) of each RSU will vest when the Company’s market capitalization is equal to or greater than $500,000,000 for at least ten trading days during any twenty (20) consecutive trading day period ending on or after December 15, 2021 and the fair market value of the Common Stock equals or exceeds $150.00 during such trading day period.
     
  ● One-third (33%) of each RSU will vest when the Company’s market capitalization is equal to or greater than $750,000,000 for at least ten trading days during any twenty (20) consecutive trading day period ending on or after December 15, 2021 and the fair market value of the Common Stock equals or exceeds $150.00 during such trading day period.
     
  ● The remaining awarded units will vest when the Company’s market capitalization is equal to or greater than $1,000,000,000 for at least ten trading days during any twenty (20) consecutive trading day period ending on or after December 15, 2021 and the fair market value of the Common Stock equals or exceeds $150.00 during such trading day period.
     
  ● In the event that (i) a change in control occurs or (ii) the participant incurs a termination of service by the Company without cause or due to the participant’s death or total and permanent disability, then all unvested units shall become vested units immediately upon the occurrence of such event.

 

As of September 30, 2024, none of the vesting milestones have been met.

 

As of the three and nine months ended September 30, 2024, respectively, the Company converted 908 vested RSUs issued in September 2020 to a member of the Board of Directors, convertible into 908 shares of Common Stock of the Company. Expenses related to these RSUs had been recognized by pre-merger Akers Biosciences, Inc. in 2021 and prior years.

 

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The following is the status of outstanding unvested restricted stock units outstanding as of September 30, 2024 and the changes for the nine months ended September 30, 2024:

 

       Weighted 
       Average 
   Number of   Grant Date 
   RSUs   Fair Value 
Balance at December 31, 2023   88,668   $242.70 
Granted   -    - 
Vested   -    - 
Forfeited   (40,334)   242.70 
Canceled/Expired   -    - 
Balance at September 30, 2024   48,334   $242.70 

 

As of September 30, 2024, the unamortized value of the RSUs was $11,730,660.

 

Note 6 – Equity

 

Authorized Capital Stock

 

On July 24, 2024, the Company’s stockholders approved the adoption of the Certificate of Amendment to the Company’s Certificate of Incorporation to increase the number of authorized shares of the Company’s Common Stock from 16,666,666 to 250,000,000 (“Authorized Share Increase Amendment”) and to make a corresponding change to the number of authorized shares of capital stock. On July 25, 2024, the Company filed the Authorized Share Increase Amendment with the Secretary of State of Delaware (the “Secretary of State”). On June 17, 2024, the Company filed a Certificate of Amendment to the Series G Certificate of Designations with the Secretary of State to increase the number of authorized shares of Series G Preferred Stock from 8,950 to 12,826,273.

 

As of September 30, 2024, the Company’s authorized capital stock consisted of 300,000,000 shares, of which 250,000,000 are shares of Common Stock, and 50,000,000 are shares of preferred stock, $0.001 par value per share, 1,990,000 of which have been designated as Series C Convertible Preferred Stock (the “Series C Preferred Stock”), 211,353 of which have been designated as Series D Convertible Preferred Stock (the “Series D Preferred Stock”), 100,000 of which have been designated as Series E Junior Participating Preferred Stock, 15,000 of which have been designated as Series F Convertible Preferred Stock (the “Series F Preferred Stock”) 5,050 of which have been designated as Series F-1 Convertible Preferred Stock and 12,826,273 of which have been designated as Series G Preferred Stock. As of September 30, 2024 and December 31, 2023, there were 2,472,048 and 2,018,857 shares of Common Stock issued and outstanding, respectively. There were 72,992 shares of Series D Preferred Stock issued and outstanding and warrants to purchase Series C Preferred Stock convertible into 918 shares of Common Stock issued and outstanding as of September 30, 2024 and December 31, 2023. There were 4,675 and 6,633 shares of Series F Preferred Stock issued and outstanding as of September 30, 2024 and December 31, 2023, respectively. There were 5,050 and 0 shares of Series F-1 Preferred Stock issued and outstanding as of September 30, 2024 and December 31, 2023, respectively. There were 8,950 and 0 shares of Series G Preferred Stock issued and outstanding as of September 30, 2024 and December 31, 2023, respectively. There were no shares of Series C Convertible Preferred Stock or Series E Junior Participating Preferred Stock issued and outstanding as of September 30, 2024 and December 31, 2023.

 

Preferred Stock

 

The holders of preferred shares or preferred warrants are entitled to vote per share, as limited by the certificate of designation for each class of preferred shares or warrants, at meetings of the Company.

 

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Series D Convertible Preferred Stock

 

The following are the principal terms of the Series D Preferred Stock:

 

Rank

 

The Series D Preferred Stock ranks (1) on parity with Common Stock on an “as converted” basis, (2) senior to any series of our capital stock hereafter created specifically ranking by its terms junior to the Series D Preferred Stock, (3) on parity with any series of our capital stock hereafter created specifically ranking by its terms on parity with the Series D Preferred Stock, and (4) junior to any series of our capital stock hereafter created specifically ranking by its terms senior to the Series D Preferred Stock in each case, as to dividends or distributions of assets upon our liquidation, dissolution or winding up whether voluntary or involuntary.

 

Conversion Rights

 

A holder of Series D Preferred Stock is entitled at any time to convert any whole or partial number of shares of Series D Preferred Stock into shares of our Common Stock, determined by dividing the stated value equal to $0.01 by the conversion price of $0.01 per share. A holder of Series D Preferred Stock is prohibited from converting Series D Preferred Stock into shares of Common Stock if, as a result of such conversion, the holder, together with its affiliates, would own more than 4.99% of the total number of shares of our Common Stock then issued and outstanding (with such ownership restriction referred to as the “Series D Beneficial Ownership Limitation”) immediately after giving effect to the issuance of the shares of Common Stock issuable upon conversion of the Series D Preferred Stock. However, any holder may increase or decrease such percentage to any other percentage not in excess of 9.99%, provided that any increase in such percentage shall not be effective until 61 days after such notice to us. The conversion rate of the Series D Preferred Stock is subject to proportionate adjustments for stock splits, reverse stock splits and similar events, but is not subject to adjustment based on price anti-dilution provisions.

 

Dividend Rights

 

In addition to stock dividends or distributions for which proportionate adjustments will be made, holders of Series D Preferred Stock are entitled to receive dividends on shares of Series D Preferred Stock equal, on an as-if-converted-to-common-stock basis, to and in the same form as dividends actually paid on shares of the Common Stock when, as and if such dividends are paid on shares of the Common Stock. No other dividends are payable on shares of Series D Preferred Stock.

 

Voting Rights

 

Subject to the Series D Beneficial Ownership Limitation, on any matter presented to our stockholders for their action or consideration at any meeting of our stockholders (or by written consent of stockholders in lieu of a meeting), each holder, in its capacity as such, shall be entitled to cast the number of votes equal to the number of whole shares of our Common Stock into which the Series D Preferred Stock beneficially owned by such holder are convertible as of the record date for determining stockholders entitled to vote on or consent to such matter (taking into account all Series D Preferred Stock beneficially owned by such holder). Except as otherwise required by law or by the other provisions of the Certificate of Designation of Series D Convertible Preferred Stock (the “Series D Certificate of Designation”), the holders of Series D Preferred Stock, in their capacity as such, shall vote together with the holders of our Common Stock and any other class or series of stock entitled to vote thereon as a single class.

 

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Liquidation Rights

 

Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, the holders of Series D Preferred Stock are entitled to receive, pari passu with the holders of Common Stock, out of the assets available for distribution to stockholders an amount equal to such amount per share as would have been payable had all shares of Series D Preferred Stock been converted into Common Stock immediately before such liquidation, dissolution or winding up, without giving effect to any limitation on conversion as a result of the Series D Beneficial Ownership Limitation, as described above.

 

Exchange Listing

 

Series D Preferred Stock is not listed on the Nasdaq, any national securities exchange or other nationally recognized trading system. Our Common Stock issuable upon conversion of the Series D Preferred Stock is listed on the Nasdaq under the symbol “TNFA”.

 

Failure to Deliver Conversion Shares

 

If the Company fails to timely deliver shares of Common Stock upon conversion of the Series D Preferred Stock (the “Series D Conversion Shares”) within the time period specified in the Series D Certificate of Designation (within two trading days after delivery of the notice of conversion, or any shorter standard settlement period in effect with respect to trading market on the date notice is delivered), then the Company is obligated to pay to the holder, as liquidated damages, an amount equal to $25 per trading day (increasing to $50 per trading day on the third trading day and $100 per trading day on the sixth trading day) for each $5,000 of stated value of Series D Preferred Stock being converted which are not timely delivered. If the Company makes such liquidated damages payments, the Company is also not obligated to make Series D Buy-In (as defined below) payments with respect to the same Series D Conversion Shares.

 

Compensation for Series D Buy-In on Failure to Timely Deliver Shares

 

If the Company fails to timely deliver the Series D Conversion Shares to the holder, and if after the required delivery date the holder is required by its broker to purchase (in an open market transaction or otherwise) or the holder or its brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by the holder of the Series D Conversion Shares which the holder anticipated receiving upon such conversion or exercise (a “Series D Buy-In”), then the Company is obligated to (A) pay in cash to such holder (in addition to any other remedies available to or elected by such holder) the amount, if any, by which (x) such holder’s total purchase price (including any brokerage commissions) for the shares of Common Stock so purchased exceeds (y) the product of (1) the aggregate number of Series D Conversion Shares that such holder was entitled to receive from the conversion at issue multiplied by (2) the actual sale price at which the sell order giving rise to such purchase obligation was executed (including any brokerage commissions) and (B) at the option of such holder, either reissue (if surrendered) the shares of Series D Preferred Stock equal to the number of shares of Series D Preferred Stock submitted for conversion (in which case, such conversion shall be deemed rescinded) or deliver to such holder the number of Series D Conversion Shares that would have been issued if the Company had timely complied with its delivery requirements.

 

As of September 30, 2024, the Company had 72,992 shares of Series D Convertible Preferred Stock outstanding which represent 1,217 underlying shares of the Company’s Common Stock.

 

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Series F Convertible Preferred Stock

 

The following are the principal terms of the Series F Preferred Stock:

 

Voting Rights

 

Except as required by law (including without limitation, the Delaware General Corporation Law (the “DGCL”)), the holders of the Series F Preferred Stock are entitled to vote with holders of the Common Stock on as as-converted basis, with the number of votes to which each holder of Series F Preferred Stock is entitled to be calculated assuming a conversion price of $60.21 per share, which was the Minimum Price (as defined in Rule 5635 of the Rule of the Nasdaq Stock Market) applicable immediately before the execution and delivery of the Purchase Agreement, subject to certain beneficial ownership limitations as set forth in the Series F Certificate of Designation. The Series F Certificate of Designation further provides that the holders of record of the Series F Preferred Stock, exclusively and as a separate class, shall be entitled to elect one director of the Company one time on or before June 30, 2024. To the extent that under the DGCL the vote of the holders of shares of Series F Preferred Stock, voting separately as a class or series, as applicable, is required to authorize a given action of the Company, the affirmative vote or consent of a majority of the outstanding shares of Series F Preferred Stock, voting together in the aggregate and not in separate series unless required under the DGCL, represented at a duly held meeting at which a quorum is presented or by written consent of such majority (except as otherwise may be required under the DGCL) shall constitute the approval of such action by both the class or the series, as applicable.

 

Liquidation

 

Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, each holder of shares of the Series F Preferred Stock shall be entitled to receive out of the assets, whether capital or surplus, of the Company an amount per share of Series F Preferred Stock equal to the greater of (A) 125% of the stated value of such share of Series F Preferred Stock (plus any applicable make-whole amount, unpaid late charge or other applicable amount) on the date of such payment and (B) the amount per share such holder would receive if such holder converted such share of Series F Preferred Stock into Common Stock immediately prior to the date of such payment. All shares of capital stock of the Company shall be junior in rank to all shares of Series F Preferred Stock with respect to the preferences as to payments upon the liquidation.

 

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Optional Conversion

 

The Series F Preferred Stock can be converted at the option of the holder at any time and from time to time after the original issuance date. Holders shall effect conversions by providing us with the form of conversion notice (the “Series F Notice of Conversion”) specifying the number of shares of Series F Preferred Stock to be converted, the number of shares of Series F Preferred Stock owned subsequent to the conversion at issue and the date on which such conversion is to be effected, which date may not be prior to the date the applicable holder delivers by email such Series F Notice of Conversion to us.

 

Mandatory Conversion

 

If on any day after the issuance of the shares of Series F Preferred Stock the closing price of the Common Stock has exceeded $6.765 (as adjusted for the Reverse Stock Split) (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events) for 20 consecutive trading days and the daily dollar trading volume of the Common Stock has exceeded $3,000,000 per trading day during the same period and certain equity conditions described in the Series F Certificate of Designation are satisfied (the “Mandatory Conversion Date”), the Company shall deliver written notice of the Mandatory Conversion (as defined below) to all holders on the Mandatory Conversion Date and, on such Mandatory Conversion Date, the Company shall convert all of each holder’s shares of Series F Preferred Stock into Conversion Shares at the then effective Conversion Price (the “Mandatory Conversion”). If any of the Equity Conditions shall cease to be satisfied at any time on or after the Mandatory Conversion Date through and including the actual delivery of all of the Conversion Shares to the holders, the Mandatory Conversion shall be deemed withdrawn and void ab initio.

 

Beneficial Ownership Limitation

 

The Series F Preferred Stock cannot be converted to Common Stock if the holder and its affiliates would beneficially own more than 4.99% or 9.99% at the election of the holder of the outstanding Common Stock. However, any holder may increase or decrease such percentage to any other percentage not in excess of 9.99% upon notice to us, provided that any increase in this limitation will not be effective until 61 days after such notice from the holder to us and such increase or decrease will apply only to the holder providing such notice.

 

Series F-1 Preferred Stock

 

The following are the principal terms of the Series F-1 Preferred Stock:

 

Dividends

 

The holders of the Series F-1 Preferred Stock are entitled to dividends of 10% per annum, compounded monthly, which are payable in arrears monthly in cash or shares of Common Stock at our option, in accordance with the terms of the Series F-1 Certificate of Designations. Upon the occurrence and during the continuance of a Triggering Event (as defined in the Series F-1 Certificate of Designations), the Series F-1 Preferred Stock will accrue dividends at the rate of 15% per annum. Upon conversion or redemption, the holders of the Series F-1 Preferred Stock are also entitled to receive a dividend make-whole payment.

 

Voting Rights

 

Except as required by law (including without limitation, the Delaware General Corporation Law (the “DGCL”)), the holders of the Series F-1 Preferred Stock are entitled to vote with holders of the Common Stock on as as-converted basis, with the number of votes to which each holder of Series F-1 Preferred Stock is entitled to be calculated assuming a conversion price of $2.253 per share, which was the Minimum Price (as defined in Rule 5635 of the Rule of the Nasdaq Stock Market) applicable immediately before the execution and delivery of the Series F-1 Purchase Agreement, subject to certain beneficial ownership limitations as set forth in the Series F-1 Certificate of Designations. To the extent that under the DGCL the vote of the holders of shares of Series F-1 Preferred Stock, voting separately as a class or series, as applicable, is required to authorize a given action of the Company, the affirmative vote or consent of a majority of the outstanding shares of Series F-1 Preferred Stock, voting together in the aggregate and not in separate series unless required under the DGCL, represented at a duly held meeting at which a quorum is presented or by written consent of such majority (except as otherwise may be required under the DGCL) shall constitute the approval of such action by both the class or the series, as applicable.

 

Liquidation

 

Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, each holder of shares of the Series F-1 Preferred Stock shall be entitled to receive out of the assets, whether capital or surplus, of the Company an amount per share of Series F-1 Preferred Stock equal to the greater of (A) 125% of the stated value of such share of Series F-1 Preferred Stock (plus any applicable make-whole amount, unpaid late charge or other applicable amount) on the date of such payment and (B) the amount per share such holder would receive if such holder converted such share of Series F-1 Preferred Stock into Common Stock immediately prior to the date of such payment. All shares of capital stock of the Company shall be junior in rank to all shares of Series F-1 Preferred Stock with respect to the preferences as to payments upon the liquidation.

 

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Exchange Cap

 

The Company was initially restricted from issuing shares of Common Stock upon conversion of the Series F-1 Preferred Stock and Series G Preferred Stock or exercise of the associated warrants in excess of 19.99% of the shares of Common Stock outstanding as of the date immediately prior to the issuance of the shares of Series F-1 Preferred Stock and Series G Preferred Stock and the associated warrants (the “Issuable Maximum”) until the Company obtained stockholder approval for the issuance of shares of Common Stock in excess of the Issuable Maximum. The Company received the Stockholder Approval on July 24, 2024.

 

Optional Conversion

 

The Series F-1 Preferred Stock can be converted at the option of the holder at any time and from time to time after the original issuance date. Holders shall effect conversions by providing us with the form of conversion notice (the “Notice of Conversion”) specifying the number of shares of Series F-1 Preferred Stock to be converted, the number of shares of Series F-1 Preferred Stock owned subsequent to the conversion at issue and the date on which such conversion is to be effected, which date may not be prior to the date the applicable holder delivers by email such Notice of Conversion to us.

 

Mandatory Conversion

 

If on any day after the issuance of the shares of Series F-1 Preferred Stock the closing price of the Common Stock has exceeded $5.448 per share (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events) for 20 consecutive trading days and the daily dollar trading volume of the Common Stock has exceeded $3,000,000 per trading day during the same period and certain equity conditions described in the Series F-1 Certificate of Designation are satisfied (the “Mandatory Conversion Date”), the Company shall deliver written notice of the Mandatory Conversion (as defined below) to all holders on the Mandatory Conversion Date and, on such Mandatory Conversion Date, the Company shall convert all of each holder’s shares of Series F-1 Preferred Stock into Conversion Shares at the then effective Conversion Price (the “Mandatory Conversion”). If any of the Equity Conditions shall cease to be satisfied at any time on or after the Mandatory Conversion Date through and including the actual delivery of all of the Conversion Shares to the holders, the Mandatory Conversion shall be deemed withdrawn and void ab initio.

 

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Beneficial Ownership Limitation

 

The Series F-1 Preferred Stock cannot be converted to Common Stock if the holder and its affiliates would beneficially own more than 4.99% or 9.99% at the election of the holder of the outstanding Common Stock. However, any holder may increase or decrease such percentage to any other percentage not in excess of 9.99% upon notice to us, provided that any increase in this limitation will not be effective until 61 days after such notice from the holder to us and such increase or decrease will apply only to the holder providing such notice.

 

Series G Preferred Stock

 

The following are the principal terms of the Series G Preferred Stock:

 

Voting Rights

 

Except as required by law (including without limitation, the Delaware General Corporation Law (the “DGCL”)), the holders of the Series G Preferred Stock are entitled to vote with holders of the Common Stock on as as-converted basis, with the number of votes to which each holder of Series G Preferred Stock is entitled to be calculated assuming a conversion price of $2.253 per share, which was the Minimum Price (as defined in Rule 5635 of the Rule of the Nasdaq Stock Market) applicable immediately before the execution and delivery of the Series G Purchase Agreement, subject to certain beneficial ownership limitations as set forth in the Series G Certificate of Designations. To the extent that under the DGCL the vote of the holders of shares of Series G Preferred Stock, voting separately as a class or series, as applicable, is required to authorize a given action of the Company, the affirmative vote or consent of a majority of the outstanding shares of Series G Preferred Stock, voting together in the aggregate and not in separate series unless required under the DGCL, represented at a duly held meeting at which a quorum is presented or by written consent of such majority (except as otherwise may be required under the DGCL) shall constitute the approval of such action by both the class or the series, as applicable.

 

Liquidation

 

Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, each holder of shares of the Series G Preferred Stock shall be entitled to receive out of the assets, whether capital or surplus, of the Company an amount per share of Series G Preferred Stock equal to the greater of (A) 125% of the stated value of such share of Series G Preferred Stock (plus any applicable make-whole amount, unpaid late charge or other applicable amount) on the date of such payment and (B) the amount per share such holder would receive if such holder converted such share of Series G Preferred Stock into Common Stock immediately prior to the date of such payment. All shares of capital stock of the Company shall be junior in rank to all shares of Series G Preferred Stock with respect to the preferences as to payments upon the liquidation.

 

Exchange Cap

 

The Company was initially restricted from issuing shares of Common Stock upon conversion of the Series F-1 Preferred Stock and Series G Preferred Stock or exercise of the associated warrants in excess of 19.99% of the shares of Common Stock outstanding as of the date immediately prior to the issuance of the shares of Series F-1 Preferred Stock and Series G Preferred Stock and the associated warrants until the Company obtained stockholder approval for the issuance of shares of Common Stock in excess of the Issuable Maximum. The Company received the Stockholder Approval on July 24, 2024.

 

Optional Conversion

 

The Series G Preferred Stock can be converted at the option of the holder at any time and from time to time after the original issuance date. Holders shall effect conversions by providing us with the form of conversion notice (the “Notice of Conversion”) specifying the number of shares of Series G Preferred Stock to be converted, the number of shares of Series G Preferred Stock owned subsequent to the conversion at issue and the date on which such conversion is to be effected, which date may not be prior to the date the applicable holder delivers by email such Notice of Conversion to us.

 

Beneficial Ownership Limitation

 

The Series G Preferred Stock cannot be converted to Common Stock if the holder, other than PharmaCyte Biotech, Inc., and its affiliates would beneficially own more than 4.99% or 9.99% at the election of the holder of the outstanding Common Stock. However, any holder may increase or decrease such percentage to any other percentage not in excess of 9.99% upon notice to us, provided that any increase in this limitation will not be effective until 61 days after such notice from the holder to us and such increase or decrease will apply only to the holder providing such notice.

 

Common Stock

 

The holders of Common Stock are entitled to one vote per share at meetings of the Company.

 

As of September 30, 2024, the Company had 2,472,048 shares of Common Stock issued and outstanding. During the nine months ended September 30, 2024, the Company issued 453,191 shares of Common Stock in connection with amortization payments or make-whole payments for the Series F Preferred Stock.

 

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Common Stock Warrants

 

The table below summarizes the warrant activity for the nine months ended September 30, 2024:

 

       Weighted   Average     
       Average   Remaining   Aggregate 
   Number of   Exercise   Contractual   Intrinsic 
   Warrants   Price   Term (years)   Value 
Balance at December 31, 2023   4,933,622   $147.86    4.08   $21,650,589 
Issued   15,418,510    1.816    3.15    - 
Series F Modification                    
Removed   (4,716,904)   3.18    3.65    - 
Re-issued   8,259,911    1.816    3.65    - 
Exercised   -    -    -    - 
Forfeited   -    -    -    - 
Canceled/Expired   -    -    -    - 
Balance at September 30, 2024   23,895,139   $3.03    3.06   $- 
Exercisable as of September 30, 2024   23,895,139   $3.03    3.06   $- 

 

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the closing stock price of $1.62 for the Company’s Common Stock on September 30, 2024 and the closing stock price of $7.77 for the Company’s Common Stock on December 31, 2023.

 

The Series F Exercise Price and the number of shares issuable upon exercise of the Series F Warrants are subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment, on a “full ratchet” basis, in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable Series F Exercise Price (subject to certain exceptions). Upon any such price-based adjustment to the Series F Exercise Price, the number of shares issuable upon exercise of the Series F Warrants will be increased proportionately. Pursuant to the February 2023 Offering, the Company issued to investors the Series F Warrants to purchase 4,716,904 shares of Common Stock (as adjusted, and subject to further adjustment), with an initial exercise price of $3.18 per share, which was adjusted to $1.816 per share and the number of shares of Common Stock issuable upon exercise of the Series F warrants was adjusted proportionally to 8,259,911 shares pursuant to the full ratchet anti-dilution provisions contained in the Series F Warrants in connection with the Private Placement (as defined herein) (as adjusted, and subject to further adjustment), for a period of five years from the date of issuance.

 

Series C Convertible Preferred Stock Warrants

 

The table below summarizes the warrant activity for the nine months ended September 30, 2024:

 

       Weighted   Average     
       Average   Remaining   Aggregate 
   Number of   Exercise   Contractual   Intrinsic 
   Warrants   Price   Term (years)   Value 
Balance at December 31, 2023   918   $240.00    0.94   $- 
Granted   -    -    -    - 
Exercised   -    -    -    - 
Forfeited   -    -    -    - 
Cancelled/Expired   -    -    -    - 
Balance at September 30, 2024   918   $240.00    0.19   $- 
Exercisable as of September 30, 2024   918   $240.00    0.19   $- 

 

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the closing price of $1.62 for the Company’s Common Stock on September 30, 2024 and the closing stock price of $7.77 for the Company’s Common Stock on December 31, 2023. All Series C Convertible Preferred Stock Warrants were vested on date of grant.

 

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Note 7 – Commitments and Contingencies

 

Litigation and Settlements

 

Raymond Akers Actions

 

On April 14, 2021, Raymond F. Akers, Jr., Ph.D. filed a lawsuit against the Company (f/k/a Akers Biosciences, Inc.) in the Superior Court of New Jersey, Law Division, Gloucester County (the “First Raymond Akers Action”). Mr. Akers asserts one common law whistleblower retaliation claim against the Company.

 

On September 23, 2021, the Court granted the Company’s Motion to Dismiss Plaintiff’s Amended Complaint and dismissed Plaintiff’s Amended Complaint. The Court indicated that Mr. Akers is “free to file another complaint, however, tort-based ‘Pierce’ allegations, and/or CEPA claims are barred by the statute of limitations.”

 

On March 1, 2022, Mr. Akers filed a second action against the Company in the Superior Court of New Jersey, Law Division, Gloucester County (the “Second Raymond Akers Action”) again asserting one common law whistleblower retaliation claim against the Company. The Company believes that the Second Raymond Akers Action is without merit and, moreover, was filed against the Court’s specific admonition that Plaintiff does not attempt to circumvent the statute of limitations.

 

On May 27, 2022, the Court granted-in-part and denied-in-part the Company’s Motion to Dismiss Plaintiff’s Complaint. The Court reaffirmed the ruling in the First Raymond Akers Action that any tort-based Pierce claims are time-barred. However, the Court denied the Motion as it pertained to Plaintiff’s contract-based Pierce claim and “Repayment of Monies Owed” claim. On July 29, 2022, the Company filed its Answer, which included affirmative defenses. As of September 30, 2024, the Second Raymond Akers Action is in the discovery phase.

 

All legal fees incurred were expensed as and when incurred. While no assurance can be provided, the Company does not believe that the current litigation will have a material impact on its financial condition or results of operations.

 

Note 8 – Related Parties

 

SRQ Patent Holdings and SRQ Patent Holdings II

 

The Company is a party to two Amended and Restated Confirmatory Patent Assignment and Royalty Agreements, both dated November 11, 2020, with SRQ Patent Holdings and SRQ Patent Holdings II, under which the Company (or its successor) will be obligated to pay to SRQ Patent Holdings or SRQ Patent Holdings II (or its designees) certain royalties on product sales or other revenue received on products that incorporate or are covered by the intellectual property that was assigned to the Company. The royalty is equal to 8% of the net sales price on product sales and, without duplication, 8% of milestone revenue or sublicense compensation. SRQ Patent Holdings and SRQ Patent Holdings II are affiliates of Mr. Jonnie Williams, Sr. No revenue has been recognized subject to these agreements for the three and nine months ended September 30, 2024 and 2023.

 

MIRA Pharmaceuticals Limited License Agreement

 

The Company is a party to an Amended and Restated Limited License Agreement, dated June 27, 2022 and amended on April 20, 2023, with MIRA Pharmaceuticals, Inc. (Nasdaq: MIRA), under which the parties agreed to share technical information and know-how pertaining to the synthetic manufacture and formulation of the parties’ respective Supera-CBD™ and MIRA1a™ product candidates. The Company, which holds patent rights to MIRA1a™ in 22 foreign countries, was granted a perpetual, non-exclusive, royalty-free license to use improvements to MIRA1a™ made under the agreement, and MIRA was granted a limited, perpetual, worldwide, non-exclusive, royalty-free license to use Supera-CBD™ as a synthetic intermediate in the manufacture of MIRA1a™.

 

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Series G Preferred Stock Issuance

 

On May 20, 2024, the Company entered into the Series G Purchase Agreement with the Series G Investors, including PharmaCyte Biotech, Inc. (“Pharmacyte”), pursuant to which it agreed to sell to the Series G Investors (i) an aggregate of 8,950 Series G Preferred Stock, initially convertible into up to 4,928,416 shares of the Company’s Common Stock, at a conversion price of $1.816 per share (ii) Series G Short-Term Warrants to acquire up to an aggregate of 4,928,416 shares of Common Stock at an exercise price of $1.816 per share, and (iii) Series G Long-Term Warrants acquire up to an aggregate of 4,928,416 shares of Common Stock at an exercise price of $1.816 per share, for aggregate gross proceeds equaling approximately $8.9 million. The interim CEO, President and Director of PharmaCyte, Joshua Silverman, serves as the Company’s Chairman of the Board.

 

Note 9 – Employee Benefit Plan

 

The Company maintains a defined contribution benefit plan under section 401(k) of the Internal Revenue Code covering substantially all qualified employees of the Company (the “401(k) Plan”). Under the 401(k) Plan, the Company matches 100% up to a 3% contribution, and 50% over a 3% contribution, up to a maximum of 5%.

 

The Company made matching contributions to the 401(k) Plan during the three and nine months ended September 30, 2024 of $9,186 and $19,859, respectively.

 

The Company made matching contributions to the 401(k) Plan during the three and nine months ended September 30, 2023 of $11,435 and $30,517, respectively.

 

Note 10—Patent Assignment and Royalty Agreement

 

In November 2016, the Company entered into an agreement with the holders of certain intellectual property relating to the Company’s current product candidate. Under the terms of the agreement, the counterparty assigned its rights and interest in certain patents to the Company in exchange for future royalty payments based on a fixed percentage of future revenues, as defined. The agreement is effective until the later of (1) the date of expiration of the assigned patents or (2) the date of expiration of the last strategic partnership or licensing agreement including the assigned patents. No revenue has been received subject to this agreement for the three and nine months ended September 30, 2024 and 2023, respectively.

 

Note 11—Subsequent Events

 

Prevail Partners Stock Purchase Agreement

 

On October 1, 2024, the Company, entered into a Stock Purchase Agreement, dated as of October 1, 2024 (the “Purchase Agreement”), by and between the Company and Prevail Partners, LLC (“Prevail”), pursuant to which, the Company agreed to sell to Prevail 283,019 shares of the Company’s Common Stock, at a price per share equal to $2.12, which was 120.0% of the dollar volume-weighted average price of the Company’s Common Stock on the Nasdaq Stock Capital Market LLC for the thirty (30) trading days immediately preceding the date of the Purchase Agreement (the “Private Placement”).

 

The Purchase Agreement contains certain representations and warranties and indemnification provisions customary for similar transactions. The gross proceeds to the Company from the Private Placement were $600,000.

 

Appointment of Auditors

 

On September 30, 2024, in conjunction with its exit from providing audit services to publicly traded companies, Morison Cogen LLP resigned from its role as independent registered public accounting firm for the Company. On October 3, 2024, the Audit Committee of the Company engaged Stephano Slack LLC as the Company’s independent registered public accounting firm for the fiscal year ended December 31, 2024, effective immediately.

 

Series F Preferred Shares

 

On November 7, 2024, each holder of the Series F Preferred Shares agreed that payment by the Company of any Installment Amounts (as defined in the Series F Certificate of Designations) that are accrued and are unredeemed, unconverted and/or otherwise unpaid as of November 7, 2024, will be deferred until December 1, 2024.

 

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

The information set forth below should be read in conjunction with our condensed consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements and related notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the Securities and Exchange Commission on April 1, 2024. This discussion and analysis contains forward-looking statements based on our current expectations, assumptions, estimates and projections. These forward-looking statements involve risks and uncertainties. Our actual results could differ materially from those indicated in these forward-looking statements as a result of certain factors, including those discussed in Part II, Item 1A of this Quarterly Report on Form 10-Q, entitled “Risk Factors.” References in this discussion and analysis to “us,” “we,” “our,” or “the Company” refer collectively to TNF Pharmaceuticals, Inc.

 

Our financial statements are prepared in accordance with GAAP. These accounting principles require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments and assumptions are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting any available alternative would not produce a materially different result. The following discussion should be read in conjunction with our financial statements and notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q.

 

This quarterly report on Form 10-Q and other reports filed by the Company from time to time with the Securities and Exchange Commission (the “SEC” and such reports, collectively, the “Filings”) contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, the Company’s management as well as estimates and assumptions made by Company’s management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the Filings, the words “anticipate,” “believe,” “estimate,” “expect,” “future,” “intend,” “plan,” or the negative of these terms and similar expressions as they relate to the Company or the Company’s management identify forward-looking statements. Such statements reflect the current view of the Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors, including the risks relating to the Company’s business, industry, and the Company’s operations and results of operations. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned.

 

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

 

Important factors that could cause actual results to differ materially from the results and events anticipated or implied by such forward-looking statements include, but are not limited to:

 

  ● fluctuation and volatility in market price of our Common Stock due to market and industry factors, as well as general economic, political and market conditions;
     
  ● the impact of dilution on our stockholders;
     
  ● our ability to realize the intended benefits of the Merger (as defined below) and the Contribution Agreement (as defined below);
     
  ● holders of our Series F Preferred Shares (as defined herein), Series F-1 Preferred Shares (as defined herein) and Series G Preferred Shares (as defined herein) are entitled to certain payments that may be paid in cash or in shares of Common Stock, as applicable and depending on the circumstances, if we make these payments in cash, we may be required to expend a substantial portion of our cash resources, and if we make these payments in Common Stock, it may result in substantial dilution to the holders of our Common Stock;
     
  ●

the certificate of designations for each of the Series D Convertible Preferred Stock, Series F Preferred Shares, Series F-1 Preferred Shares and Series G Preferred Shares and the warrants issued concurrently therewith, as applicable, contain anti-dilution provisions and other adjustment provisions that have resulted in the reduction of the conversion price of such preferred stock and the exercise price of such warrants and may do so again in the future. These features may increase the number of shares of common stock issuable upon conversion of such preferred stock or upon the exercise of the warrants; 

 

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  ● the impact of our ability to realize the anticipated tax impact of the Merger;
     
  ● the outcome of litigation or other proceedings we may become subject to in the future;
     
  ● delisting of our Common Stock from the Nasdaq;
     
  ● our availability and ability to continue to obtain sufficient funding to conduct planned research and development efforts and realize potential profits;
     
  ● our ability to develop and commercialize our product candidates, including MYMD-1, Supera-CBD and other future product candidates;
     
  ● the impact of the complexity of the regulatory landscape on our ability to seek and obtain regulatory approval for our product candidates, both within and outside of the U.S.;
     
  ● the required investment of substantial time, resources and effort for successful clinical development and marketization of our product candidates;
     
  ● challenges we may face with maintaining regulatory approval, if achieved;
     
  ● the potential impact of changes in the legal and regulatory landscape, both within and outside of the U.S.;
     
  ● the impact of COVID-19 and potential future pandemics on the administration, funding and policies of regulatory authorities, both within and outside of the U.S.;
     
  ● our dependence on third parties to conduct pre-clinical and clinical trials and manufacture its product candidates;
     
  ● the impact of COVID-19 and potential future pandemics on our results of operations, business plan and the global economy;
     
  ● challenges we may face with respect to our product candidates achieving market acceptance by providers, patients, patient advocacy groups, third party payors and the general medical community;
     
  ● the impact of pricing, insurance coverage and reimbursement status of our product candidates;
     
  ● emerging competition and rapidly advancing technology in our industry;
     
  ● our ability to obtain, maintain and protect our trade secrets or other proprietary rights, operate without infringing upon the proprietary rights of others and prevent others from infringing on its proprietary rights;
     
  ● our ability to maintain adequate cyber security and information systems;
     
  ● our ability to achieve the expected benefits and costs of the transactions related to the acquisition of Supera Pharmaceuticals, Inc. (“Supera”);
     
  ● our ability to effectively execute and deliver our plans related to commercialization, marketing and manufacturing capabilities and strategy;
     
  ● our ability to obtain adequate financing in the future on reasonable terms, as and when we need it;
     
  ● challenges we may face in identifying, acquiring and operating new business opportunities;
     
  ● our ability to retain and attract senior management and other key employees;
     
  ● our ability to quickly and effectively respond to new technological developments;
     
  ● changes in political, economic or regulatory conditions generally and in the markets in which we operate; and
     
  ● our compliance with all laws, rules, and regulations applicable to our business.

 

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Overview

 

The Company is focused on developing and commercializing two therapeutic platforms based on well-defined therapeutic targets: MYMD-1 and Supera-CBD:

 

  ● MYMD-1 is a clinical stage small molecule that is being developed to treat age-related illnesses such as frailty and sarcopenia. MYMD-1 works by regulating the release of numerous pro-inflammatory cytokines, such as TNF-α, interleukin 6 (“IL-6”) and interleukin 17 (“IL-17”). MYMD-1 currently is being evaluated in patients with sarcopenia (age-related muscle loss). By regulating the immunometabolic system, MYMD-1 can also treat autoimmune disease, including (but not limited to) multiple sclerosis, diabetes, rheumatoid arthritis, and inflammatory bowel disease. The Company has significant intellectual property coverage to protect these autoimmune indications, as well as therapy as an anti-aging product;
     
  ● The Company is advancing MYMD-1 in sarcopenia based on positive clinical data from its Phase II trial and previous research findings. This previous clinical trial supported the safety profile, including no serious adverse events and no patient dropouts due to an adverse event. Serum analysis confirmed the mechanism of action in patients with sarcopenia aged 65-75 years old. These data support the protocol in development to assess clinical outcomes in patients with sarcopenia;
     
  ● In preparation for future studies, the Company and partner Charles River Laboratories completed the dosing in an FDA-required 90-day oral gavage electroencephalogram (EEG) safety study in an animal model. This 90-day dog study was designed to complement the GLP chronic toxicology studies that have been completed and reported to FDA. This complete toxicology package will inform the duration and dosing of future clinical studies;
     
  ● An Annual Report is in preparation for submission to FDA;
     
  ● Supera-CBD is a synthetic analog of cannabidiol (“CBD”) being developed to treat various conditions, including, but not limited to, epilepsy, pain, and anxiety/depression, through its effects on the CB2 receptor, and a monoamine oxidase enzyme (“MAO”) type B. Supera-CBD has shown promise in treating neuroinflammatory and neurodegenerative diseases, and may benefit from the recent re-classification of cannabis-derived products by FDA;
     
  ● In a pre-clinical evaluation of Supera-CBD for pain (Johns Hopkins University School of Medicine - Division of Behavioral Biology), Supera-CBD decreased pain, indicating beneficial effects on inflammatory-induced thermal pain sensitivity at all doses tested;
     
  ● The Company is currently preparing several scientific papers for publication in 2024, including an abstract for submission in the fourth quarter 2024 related to the Phase 2 study of MYMD-1 in sarcopenia/frailty to a peer-reviewed publication;
     
  ●

The Company’s new management is seeking appropriate speaking opportunities to present the Company;

 

  ● The Company is exploring non-dilutive opportunities to evaluate MYMD-1 in additional indications not previously considered.

 

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Reverse Stock Split

 

On February 14, 2024, the Company effected a 1-for-30 reverse stock split (the “Reverse Stock Split”). Simultaneously with the Reverse Stock Split, number of shares of the Company’s common stock authorized for issuance was reduced from 500,000,000 shares to 16,666,666 shares, and our authorized capital stock was reduced from 550,000,000 shares to 66,666,666 shares. The Reverse Stock Split reduced the total number of issued and outstanding shares of Common Stock, including shares held by the Company as treasury shares. All share amounts have been retroactively adjusted for the Reverse Stock Split, except as stated otherwise.

 

2021 Merger and Milestone Payments

 

On April 16, 2021, pursuant to the previously announced Agreement and Plan of Merger and Reorganization, dated November 11, 2020 (as subsequently amended, the “Merger Agreement”), by and among the Company, previously known as Akers Biosciences, Inc., XYZ Merger Sub, Inc., a wholly-owned subsidiary of the Company (“Merger Sub”), and MyMD Pharmaceuticals (Florida), Inc., a Florida corporation previously known as MyMD Pharmaceuticals, Inc. (“MyMD Florida”), Merger Sub was merged with and into MyMD Florida, with MyMD Florida continuing after the merger as the surviving entity and a wholly owned subsidiary of the Company (the “Merger”). The Merger consideration included potential milestone payments to the pre-Merger MyMD Florida stockholders (the “Milestone Payments”) payable in shares of the Company’s Common Stock upon the achievement of certain market capitalization milestone events (the “Milestone Events”) during the 36-month period immediately following the closing of the Merger (the “Milestone Period”). On April 16, 2024, the Milestone Period expired and accordingly, the pre-Merger MyMD Florida stockholders are no longer entitled to any potential Milestone Payments pursuant to the Merger Agreement.

 

The Company previously owned, through its subsidiary Cystron Biotech, LLC (“Cystron”), an exclusive license from Premas Biotech PVT Ltd. (“Premas”) with respect to Premas’ vaccine platform for the development of a vaccine against COVID-19 and other coronavirus infections. On April 16, 2021, pursuant to the Contribution and Assignment Agreement, dated March 18, 2021 (the “Contribution Agreement”) by and among the Company, Cystron, Oravax Medical, Inc. (“Oravax”) and, for the limited purpose set forth therein, Premas, the Company caused Cystron to contribute substantially all of the assets associated with its business of developing and manufacturing Cystron’s COVID-19 vaccine candidate to Oravax. Oravax is pursuing the development of the COVID-19 vaccine candidate. The Company’s interest in Oravax consists of 13% of Oravax’s outstanding shares of capital stock and the rights to a 2.5% royalty on all future net sales. The Company has evaluated several options with respect to its interest in Oravax, including a potential distribution of Oravax shares to the Company’s stockholders. This would make Oravax a publicly held company. In addition, the Company currently has the right to designate a member of the board of directors of Oravax, pursuant to which Mr. Joshua Silverman, our Chairman of the Board, has been designated to serve as a director of Oravax.

 

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Financial Operations Overview

 

We will not generate revenue from product sales unless and until we successfully complete clinical development, obtain regulatory approval for, and successfully commercialize our MYMD-1 and Supera-CBD product candidates. The lengthy process of securing marketing approvals for new drugs requires the expenditure of substantial resources. Any significant delay or failure to obtain regulatory approvals would materially adversely affect our product candidate’s development efforts and our business overall. In addition, if we obtain regulatory approval for MYMD-1 and/or Supera-CBD, we expect to incur significant expenses related to developing our commercialization capability to support product sales, marketing, manufacturing and distribution activities.

 

We anticipate that our expenses will increase significantly as we:

 

  ● advance the development of our MYMD-1 and Supera-CBD;
     
  ● initiate and continue research and preclinical and clinical development of potential new product candidates;
     
  ● maintain, expand and protect our intellectual property as it pertains to MYMD-1 and Supera-CBD;
     
  ● expand our infrastructure and facilities to accommodate ongoing development activities;
     
  ● establish agreements with contract research organizations, or CROs, and third-party contract manufacturing organizations, or CMOs, in connection with our Supera-CBD preclinical studies, MYMD-1 ongoing and planned clinical trials, Supera-CBD clinical trials and the development of our manufacturing capabilities for MYMD-1 and Supera-CBD;
     
  ● develop the large-scale manufacturing processes and capabilities for the commercialization of our MYMD-1 and Supera-CBD drug products;
     
  ● seek marketing approvals for our MYMD-1 and Supera-CBD product candidates that successfully complete clinical trials and
     
  ● establish a sales, marketing and distribution infrastructure to commercialize MYMD-1 and Supera-CBD should we obtain marketing approval.

 

As a result of these anticipated expenditures, we will need substantial additional funding to support our continuing operations and pursue our growth strategy.

 

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Components of our Results of Operations

 

Revenue

 

We have not generated any revenue from product sales and do not expect to generate any revenue from the sale of products in the near future. If our research and development efforts with MYMD-1 and Supera-CBD are successful, we may generate revenue from product sales or through license agreements with third parties.

 

Operating Expenses

 

Our operating expenses are broken into several components, including research and development and general and administrative costs.

 

We expect operating expenses to increase as we progress through the various clinical trials in the development of MYMD-1 and Supera-CBD.

 

Research and Development

 

Our research and development expenses primarily consist of costs associated with the development of MYMD-1 and Supera-CBD. These costs include, but are not limited to:

 

  ● Salaries, wages and benefits of the research and development staff;
     
  ● Contractual agreements with third parties including contract research organizations, preclinical activities and clinical trials;
     
  ● Outside consultants including fees and expenses;
     
  ● Laboratory supplies and equipment;
     
  ● Regulatory compliance; and
     
  ● Patent application and maintenance costs to protect our intellectual property.

 

We utilize third party contractors and consultants with expertise in specific research or development activities to perform work under the supervision of our researchers. We believe this allows us to control costs and to progress through the development cycle and to utilize our staff more efficiently.

 

It is difficult to project with absolute accuracy the duration or final cost of the development of MYMD-1 and Super-CBD or if revenue will be generated from the commercialization of these components. The process of achieving regulatory approval is very costly and time consuming. A few of the many factors that contribute to costs of duration include:

 

  ● Size and scope of pre-clinical trials;
     
  ● The phases of clinical development and the stage of our product candidates in the cycle;
     
  ● Per subject trial costs;
     
  ● The number of sites required for the trials and the availability of appropriate sites to perform the trials;
     
  ● The time that is required to enroll the appropriate number of trial participants; and
     
  ● The time required to achieve the approval of regulatory agencies.

 

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General and Administrative

 

General and administrative expenses primarily consist of salaries, wages and benefits for our employees in the executive, legal and accounting functions and third-party costs for legal, accounting, insurance, investor relations, stock market and board expenses.

 

Although treated as components of general and administrative expenses, we have chosen to disclose the following significant items separately:

 

Stock Based Compensation

 

Stock-based compensation includes the fair market value, as determined using the Black-Scholes options pricing model, of stock options issued to key staff and consultants.

 

Warrant Issuance Expenses

 

Warrant issuance expenses represent the portion of the fees and offering expenses incurred in connection with the February 2023 Offering attributable to the issuance of the Series F Warrants.

 

Other Income (Expense), net

 

Other income (expense), net consists of interest and dividends earned on our cash, cash equivalents, and investments, gains/(losses) on the sale of marketable securities, gains/(losses) on the changes of fair value of equity investments, gains/(losses) on the changes of fair value of warrant liabilities, gains/(losses) on the changes of fair value of derivative liabilities, and an uninsured casualty loss.

 

Results of Operations

 

Summary of Statements of Consolidated Operations for the Three Months Ended September 30, 2024 and 2023

 

We are focused on developing and commercializing two therapeutic platforms based on well-defined therapeutic targets, MYMD-1 and Supera-CBD. The following table summarized the results of consolidated operations for the three months ended September 30, 2024 and 2023.

 

   For the Three Months Ended
September 30,		 
Description  2024   2023 
Operating Expenses          
General and Administrative  $1,104,130   $1,334,690 
Research and Development   707,747    1,912,322 
Stock-Based Compensation   13,762    595,576 
Total Operating Expenses   1,825,639    3,842,588 
Loss from Operations   (1,825,639)   (3,842,588)
Other Income (Expense), net   103,762    7,885,582 
Net Income/(Loss)  $(1,929,391)  $4,042,994 

 

Revenue

 

We had no revenue from operations during the three months ended September 30, 2024 and 2023.

 

General and Administrative Expenses

 

The table below summarizes our general and administrative expenses for the three months ended September 30, 2024 and 2023:

 

   For the Three Months Ended
September 30,		 
Description  2024   2023 
Personnel Costs  $151,585   $337,948 
Professional Service Costs   332,241    351,430 
Stock Market & Investor Relations Costs   272,478    257,740 
Other Administrative Costs   347,826    387,572 
Total General and Administrative Expenses  $1,104,130   $1,334,690 

 

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Personnel costs decreased $186,363 during the three months ended September 30, 2024, compared to the three months ended September 30, 2023. The decrease is related to the Company initiatives relating to reducing the number of employees that was implemented during the fourth quarter of 2023.

 

Professional services costs decreased $19,189 during the three months ended September 30, 2024, compared to the three months ended September 30, 2023. These costs included legal and accounting and specialized consulting services regularly incurred in the normal course of business.

 

Stock market and investor relations costs increased $14,738 during the three months ended September 30, 2024, compared to the three months ended September 30, 2023. These costs include the annual Nasdaq listing fees, activities related to keeping the shareholder base informed through press releases, presentations and other communication efforts and the costs of annual stockholder meetings.

 

Other administrative expenses decreased $39,746 during the three months ended September 30, 2024, compared to the three months ended September 30, 2023. These costs include Board expenses, business insurance, corporate travel and other general operating expenses.

 

Stock-Based Compensation

 

Stock-based compensation decreased $581,814 during the three months ended September 30, 2024, compared to the three months ended September 30, 2023. The decrease is related to the accelerated vesting of the stock options issued on June 7, 2023 that occurred in the fourth quarter of 2023 which reduced the periodic recognition of costs, to the final vesting of the second tranche of the June 7, 2023 stock options, and to the reversal of recognized costs for forfeitures of unvested stock options related to a separated employee.

 

Research and Development Expenses

 

The table below summarizes our research and development expenses for the three months ended September 30, 2024 and 2023:

 

   For the Three Months Ended
September 30,		 
Description  2024   2023 
Salaries and Wages  $81,096   $575,772 
Development Programs   534,953    1,153,178 
Professional Services   81,551    95,010 
Regulatory Expenses   -    12,684 
Other Research and Development Expenses   10,147    75,678 
Total Research and Development Expenses  $707,747   $1,912,322 

 

Salaries and wages decreased $494,676 during the three months ended September 30, 2024, compared to the three months ended September 30, 2023. The decrease was associated with Company initiatives relating to reducing the number of employees implemented during the fourth quarter of 2023 and due to employee resignations during the three months ended September 30, 2024.

 

Development program costs include those associated with pre-clinical development, clinical trials and other material and development programs. Costs decreased $618,225 during the three months ended September 30, 2024, compared to the three months ended September 30, 2023 primarily due to the completion of the Phase II study for Sarcopenia during the year ended December 31, 2023.

 

Professional services costs decreased $13,459 during the three months ended September 30, 2024, compared to the three months ended September 30, 2023. These costs are primarily related to consulting services not related to a specific development program and legal and maintenance fees associated with the protection of our intellectual property.

 

Regulatory expenses decreased $12,684 during the three months ended September 30, 2024, compared to the three months ended September 30, 2023. These expenses were related to the close-out of a multi-site protocol.

 

Other research and development expenses decreased $65,531 during the three months ended September 30, 2024, compared to the three months ended September 30, 2023. These expenses include laboratory supplies, training and travel for department personnel while working with third-party trial sites. The decrease during the three months ended September 30, 2024 is primarily related to expenses for seminars and travel.

 

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Other Income and Expense

 

The table below summarizes our other income and expenses for the three months ended September 30, 2024 and 2023:

 

   For the Three Months Ended
September 30,		 
Description  2024   2023 
Interest and Dividend Income  $(163,951)  $(139,056)
(Gain)/Loss on Sale of Marketable Securities   (551)   500 
Gain on changes in fair value of Marketable Securities   (4,746)   (2,324)
Gain on changes in fair value of Derivative Liabilities   356,000    (2,566,900)
(Gain)/Loss on changes in fair value of Warrant Liabilities   17,000    (5,356,000)
Casualty (Gain)/Loss   (100,000)   178,198 
Total Other (Income)/Expense  $103.,752   $(7,885,582)

 

Other expense, net of income, totaled $103,752 for the three months ended September 30, 2024, and other income, net of expenses, totaled $7,885,582 for the three months ended September 30, 2023.

 

During the three months ended September 30, 2024 interest and dividend income increased $24,895 primarily related to the availability of cash for investment.

 

During the three months ended September 30, 2024, we recorded a loss of $17,000 related to the change in fair value of the warrant liabilities as follows:

 

  ● For the Series F-1 Short-Term Warrants (as defined herein), we recorded a gain of $22,000, The fair value of the Series F-1 Short-Term warrants of approximately $2,660,000 was estimated at July 25, 2024 utilizing the Black Scholes Model using the following weighted average assumptions: dividend yield 0%; remaining term of 1.33 years; equity volatility of 115.0%; and a risk-free interest rate of 4.70%.
     
  ● For the Series F-1 Long-Term Warrants (as defined herein), we recorded a loss of $28,000, The fair value of the Series F-1 Long-Term warrants of approximately $34,305,000 was estimated at July 25, 2024 utilizing the Black Scholes Model using the following weighted average assumptions: dividend yield 0%; remaining term of 4.83 years; equity volatility of 120.0%; and a risk-free interest rate of 4.10%.
     
  ● For the Series G Short-Term Warrants (as defined herein), we recorded a gain of $39,000, The fair value of the Series G Short-Term warrants of approximately $4,713,000 was estimated at July 25, 2024 utilizing the Black Scholes Model using the following weighted average assumptions: dividend yield 0%; remaining term of 1.33 years; equity volatility of 115.0%; and a risk-free interest rate of 4.70%.
     
  ● For the Series G Long-Term Warrants (as defined herein), we recorded a loss of $50,000, The fair value of the Series G Long-Term warrants of approximately $7,630,000 was estimated at July 25, 2024 utilizing the Black Scholes Model using the following weighted average assumptions: dividend yield 0%; remaining term of 4.83 years; equity volatility of 120.0%; and a risk-free interest rate of 4.10%.

 

During the three months ended September 30, 2024, we recorded a loss of $356,000 related to the change in fair value of the Series F-1 Derivative liabilities, which is recorded in other income (expense) on the Statements of Operations. We estimated the $1,282,000 fair value of the bifurcated embedded derivative at September 30, 2024 using a Monte Carlo simulation model, with the following inputs: the fair value of our common stock of $1.62 on the valuation date, estimated equity volatility of 100 .0%, estimated traded volume volatility of 275.0%, the time to maturity of 1 year, a discounted market interest rate of 4.18%, dividend rate of 10.0%, a penalty dividend rate of 15.0%, and probability of default of 5.2%. 

 

During the three months ended September 30, 2024, we received an insurance settlement of $100,000 for the casualty loss that occurred in July 2023.

 

Summary of Statements of Consolidated Operations for the Nine Months Ended September 30, 2024 and 2023

 

We are focused on developing and commercializing two therapeutic platforms based on well-defined therapeutic targets, MYMD-1 and Supera-CBD. The following table summarized the results of consolidated operations for the nine months ended September 30, 2024 and 2023.

 

   For the Nine Months Ended
September 30,		 
Description  2024   2023 
Operating Expenses          
General and Administrative  $3,192,762   $4,202,594 
Research and Development   2,307,789    4,907,196 
Stock-Based Compensation   970,754    2,341,915 
Warrant Issuance Expenses   1,508,602    762,834 
Total Operating Expenses   7,979,907    12,214,539 
Loss from Operations   (7,979,907)   (12,214,539)
Other Income (Expense), net   (13,315,173)   10,578,148 
Net Loss  $(21,295,080)  $(1,636,391)

 

Revenue

 

We had no revenue from operations during the nine months ended September 30, 2024 and 2023, respectively.

 

General and Administrative Expenses

 

The table below summarizes our general and administrative expenses for the nine months ended September 30, 2024 and 2023:

 

   For the Nine Months Ended
September 30,		 
Description  2024   2023 
Personnel Costs  $548,853   $1,022,522 
Professional Service Costs   1,055,228    799,320 
Stock Market & Investor Relations Costs   459,854    667,101 
Other Administrative Costs   1,128,827    1,713,651 
Total General and Administrative Expense  $3,192,762   $4,202,594 

 

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Personnel costs decreased $473,669 during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. The decrease is related to the Company initiatives relating to reducing the number of employees implemented during the fourth quarter of 2023 and an employee separation during the nine months ended September 30, 2024.

 

Professional services costs increased $255,908 during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. These costs included legal and accounting and specialized consulting services regularly incurred in the normal course of business. The increase is primarily related to an increase in fees for specialized accounting services related to the fair market valuations for the various convertible preferred stock series.

 

Stock market and investor relations costs decreased $207,747 during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. These costs include the annual Nasdaq listing fees, activities related to keeping the shareholder base informed through press releases, presentations and other communication efforts and the costs of shareholder meetings. The decrease is primarily due to the preparation costs associated with the 2023 annual shareholder meeting.

 

Other administrative expenses decreased $584,824 during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. These costs include Board expenses, business insurance, corporate travel and other general operating expenses. The decrease is associated with a reimbursement of expenses to a related party as authorized by the Board of Directors in April 2023.

 

Stock-Based Compensation

 

Stock-based compensation decreased $1,371,161 during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. The decrease is related to the accelerated vesting of the June 7, 2023 stock options that occurred in the fourth quarter of 2023 which reduced the periodic recognition of costs, to the final vesting of the second tranche of the June 7, 2023 stock option, and to the reversal of recognized costs for forfeitures of unvested stock options related to a separated employee.

 

Warrant Issuance Expenses

 

Warrant issuance expenses associated with the issuance of the Series F-1 Preferred Stock and the Series G Preferred Stock and Series G Warrants (as defined herein) and Series F-1 Warrants (as defined herein) totaled $1,508,602. These costs included placement agent, legal, and accounting fees.

 

Research and Development Expenses

 

The table below summarizes our research and development expenses for the nine months ended September 30, 2024 and 2023:

 

   For the Nine Months Ended
September 30,		 
Description  2024   2023 
Salaries and Wages  $634,315   $1,365,490 
Development Programs   1,489,040    3,148,782 
Professional Services   160,957    231,634 
Regulatory Expenses   390    19,784 
Other Research and Development Expenses   23,087    141,506 
Total Research and Development Expenses  $2,307,789   $4,907,196 

 

Salaries and wages decreased $731,175 during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. The decrease was associated with the Company initiatives relating to reducing the number of employees implemented during the fourth quarter of 2023 and to separations due to resignations during the nine months ended September 30, 2024.

 

Development program costs include those associated with pre-clinical development, clinical trials and other material and development programs. Costs decreased $1,659,742 during nine months ended September 30, 2024, compared to the nine months ended September 30, 2023 primarily due to the completion of the Phase II study for Sarcopenia during the year ended December 31, 2023.

 

Professional services costs decreased $70,677 during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. These costs are primarily related to consulting services not related to a specific development program and legal and maintenance fees associated with the protection of our intellectual property.

 

Regulatory expenses decreased $19,394 during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. These costs are associated with the development and management of the protocols used in various studies.

 

Other research and development expenses decreased $118,419 during the nine months September 30, 2024, compared to the nine months ended September 30, 2023. These expenses include laboratory supplies, training and travel for department personnel while working with third-party trial sites. The decrease during the nine months ended September 30, 2024 is primarily related to expenses for seminars and travel.

 

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Other Income and Expense

 

The table below summarizes our other income and expenses for the nine months ended September 30, 2024 and 2023:

 

   For the Nine Months Ended
September 30,		 
Description  2024   2023 
Interest and Dividend Income  $(203,405)  $(339,731)
Loss on Sale of Marketable Securities   (651)   714 
Loss on changes in fair value of Marketable Securities   (3,771)   371 
Loss on changes in fair value of Derivative Liabilities   367,000    (2,251,700)
Gain on changes in fair value of Warrant Liabilities   4,410,000    (8,166,000)
Loss on issuance of preferred stock   8,846,000    - 
Casualty (Gain)/Loss   (100,000)   178,198 
Total Other (Income), net of expenses  $13,315,173   $(10,578,148)

 

Other expenses, net of income, totaled $13,315,173 for the nine months ended September 30, 2024, and other income, net of expense, totaled $10,578,148 for the nine months ended September 30, 2023.

 

During the nine months ended September 30, 2024 interest and dividend income decreased $136,326 compared to the nine months ended September 30, 2023 primarily related to the availability of cash for investment.

 

During the nine months ended September 30, 2024, we recorded a loss of $4,410,000 related to the change in fair value of the warrant liabilities as follows:

 

  ● For the Series F Warrants (as defined herein), we recorded a loss of $7,094,000, The fair value of the Series F warrants of approximately $7,194,000 was estimated at March 31, 2024 utilizing the Black Scholes Model using the following weighted average assumptions: dividend yield 0%; remaining term of 3.90 years; equity volatility of 110.0%; and a risk-free interest rate of 4.31%.
     
  ● For the Series F-1 Short-Term Warrants (as defined herein), we recorded a gain of $646,000, The fair value of the Series F-1 Short-Term warrants of approximately $2,660,000 was estimated at July 25, 2024 utilizing the Black Scholes Model using the following weighted average assumptions: dividend yield 0%; remaining term of 1.33 years; equity volatility of 115.0%; and a risk-free interest rate of 4.70%.
     
  ● For the Series F-1 Long-Term Warrants (as defined herein), we recorded a gain of $322,000, The fair value of the Series F-1 Long-Term warrants of approximately $34,305,000 was estimated at July 25, 2024 utilizing the Black Scholes Model using the following weighted average assumptions: dividend yield 0%; remaining term of 4.83 years; equity volatility of 120.0%; and a risk-free interest rate of 4.10%.
     
  ● For the Series G Short-Term Warrants (as defined herein), we recorded a gain of $1,146,000, The fair value of the Series G Short-Term warrants of approximately $4,713,000 was estimated at July 25, 2024 utilizing the Black Scholes Model using the following weighted average assumptions: dividend yield 0%; remaining term of 1.33 years; equity volatility of 115.0%; and a risk-free interest rate of 4.70%.
     
  ● For the Series G Long-Term Warrants (as defined herein), we recorded a gain of $570,000, The fair value of the Series G Long-Term warrants of approximately $7,630,000 was estimated at July 25, 2024 utilizing the Black Scholes Model using the following weighted average assumptions: dividend yield 0%; remaining term of 4.83 years; equity volatility of 120.0%; and a risk-free interest rate of 4.10%.

 

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During the nine months ended September 30, 2024, we recorded a loss of $11,000 related to the change in fair value of the derivative liabilities as follows:

 

  ● For the Series F Derivative (as defined herein), we recorded a gain of $61,000 , We estimated the $0 fair value of the bifurcated embedded derivative at September 30, 2024 using a Monte Carlo simulation model, with the following inputs: the fair value of our common stock of $1.62 on the valuation date, estimated equity volatility of 80.0%, estimated traded volume volatility of 330.0%, the time to maturity of 0.25 year, a discounted market interest rate of 12.5%, dividend rate of 10.0%, a penalty dividend rate of 15.0%, and probability of default of 7.4%.
     
  ● For the Series F-1 Derivative (as defined herein), we recorded a loss of $428,000. We estimated the $1,282,000 fair value of the bifurcated embedded derivative at September 30, 2024 using a Monte Carlo simulation model, with the following inputs: the fair value of our common stock of $1.62 on the valuation date, estimated equity volatility of 100.0%, estimated traded volume volatility of 275.0%, the time to maturity of 1 year, a discounted market interest rate of 4.18%, dividend rate of 10.0%, a penalty dividend rate of 15.0%, and probability of default of 5.2%.

 

During the nine months ended September 30, 2024, we recorded a loss associated with the issuance of the Series F-1 Preferred Stock totaling $3,737,000 and the Series G Preferred Stock totaling $5,109,000. The losses resulted from the fair market value of the issued warrants exceeding the sum of the gross proceeds, discount and derivative derived from the placement of the preferred shares.

 

During the nine months ended September 30, 2024, we received an insurance settlement of $100,000 for the casualty loss that occurred in July 2023.

 

Liquidity and Capital Resources

 

As of September 30, 2024, the Company’s cash on hand was $1,192,351 and marketable securities were $9,449,483. The Company has incurred a total net loss attributable to stockholders of $24,025,339 for the nine months ended September 30, 2024. As of September 30, 2024, the Company had working capital of $5,038,212 and stockholders’ equity of $16,777,343, including an accumulated deficit of $126,002,406. During the nine months ended September 30, 2024, cash flows used in operating activities were $8,212,233, consisting primarily of a net loss of $21,296,80, a decrease in prepaid expenses of $491,875, a decrease in deferred compensation payable of $100,538, and an increase in dividends payables of $1,356,709 offset by non-cash losses for the issuance of preferred stock of $8,846,000, the change in fair value of warrants of $4,410,000, the change in fair value of derivatives of $367,000, and stock-based compensation of $970,754, and an increase in trade and other payables of $444,119. Since its inception, the Company has met its liquidity requirements principally through the sale of its Common Stock and preferred stock in public and private offerings of its securities.

 

Holders of the Company’s Series F Preferred Shares (as defined below) are entitled to certain dividends and amortization payments as described in the section titled “Series F Preferred Shares” below. Each payment may be made in cash or, at the Company’s option and subject to certain conditions, either in shares of Common Stock in an amount based on the Conversion Price (as defined below) in effect at the time that such payment is due or in a combination of cash and shares of Common Stock. If the Company elects to make all payments to the holders of the Series F Preferred Shares that fall due within the twelve-month period following June 30, 2023 in cash, the Company estimates that it will pay to the holders of the Series F Preferred Shares up to $14.3 million, assuming that a Triggering Event (as defined in the Certificate of Designation) has not occurred. The dividend rate is subject to adjustment, and the actual amount due to the holders of the Series F Preferred Shares may exceed such amount. If the Company elects to make all such payments in shares of Common Stock, based on the Conversion Price of $2.255 per share of Common Stock in effect as of June 30, 2023 and 12,500 shares of Series F Preferred Stock outstanding as of June 30, 2023, the Company estimates that it will issue to the holders of the Series F Preferred Shares up to 6.3 million shares of Common Stock. The Conversion Price is subject to adjustment, including based on the market price of the Company’s Common Stock during the thirty trading day period immediately prior to the date on which a payment is due to the holders of the Series F Preferred Shares, and the actual number of shares issuable to the holders of the Series F Preferred Shares may exceed such number. For more information regarding payments due to the holders of the Series F Preferred Shares, see the section titled “Series F Preferred Shares” below.

 

Management has evaluated the Company’s current cash requirements for operations in conjunction with management’s strategic plan and believes that the Company’s current financial resources as of the date of the issuance of these condensed consolidated financial statements, are sufficient to fund its current operating budget and contractual obligations as of September 30, 2024 as they fall due within the next twelve-month period, alleviating any substantial doubt raised by the Company’s historical operating results and satisfying its estimated liquidity needs for twelve months from the issuance of these condensed consolidated financial statements.

 

Operating Activities

 

During the nine months ended September 30, 2024, cash flows used in operating activities were $8,212,233, consisting primarily of a net loss of $21,296,80, a decrease in prepaid expenses of $491,875, a decrease in deferred compensation payable of $100,538, and an increase in dividends payables of $1,356,709 offset by non-cash losses for the issuance of preferred stock of $8,846,000, the change in fair value of warrants of $4,410,000, the change in fair value of derivatives of $367,000, and stock-based compensation of $970,754, and an increase in trade and other payables of $444,119.

 

During the nine months ended September 30, 2023, cash flows used in operating activities were $11,047,995 consisting primarily of a net loss of $1,636,391, an increase in prepaid expenses of $697,691, a reduction in trade and other payables of $639,381 and a non-cash change in the fair value of the warrant and derivative liabilities of $10,417,700 offset by non-cash stock based compensation of $2,341,915.

 

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Investing Activities

 

Our net cash consumed by investing activities totaled $7,202,955 for the nine months ended September 30, 2024 as compared to $4,088,466 during the nine months ended September 30, 2023. During the nine months ended September 30, 2024, we purchased securities totaling $12,539,405 and sold securities totaling $5,500,450. During the nine months ended September 30, 2023, we purchased securities totaling $13,338,466 and sold securities totaling $9,250,000.

 

Financing Activities

 

Net cash provided by financing activities during the nine months ended September 30, 2024 was $13,926,528 which consisted of payments for the redemption of Series F Preferred Stock and the related dividends and premiums and the proceeds from the sale of the Series F-1 Preferred Stock and the Series G Preferred Stock. Net cash provided by financing activities during the nine months ended September 30, 2023 was $14,685,689, which consisted of the net proceeds from the sale of Series F Convertible Preferred Stock, net of offering costs.

 

February 2023 Offering

 

On February 21, 2023, we entered into a Securities Purchase Agreement (the “February 2023 SPA”) with certain accredited investors (the “Series F Investors”), pursuant to which we agreed to sell in a registered direct offering (the “February 2023 Offering”) (i) an aggregate of 15,000 shares (the “Series F Preferred Shares”) of our newly-designated Series F Convertible Preferred Stock, with a stated value of $1,000 per Preferred Share (the “Series F Preferred Stock”), convertible into shares of Common Stock (the “Series F Conversion Shares”) pursuant to the terms of the Certificate of Designations of the Series F Preferred Stock, which was subsequently amended and restated by the filing of the Amended and Restated Certificate of Designations of Series F Convertible Preferred Stock, effective April 8, 2024 (as amended and restated, the “Series F Certificate of Designation”), and (ii) warrants (the “Series F Warrants”) to acquire up to an aggregate of 6,651,885 shares of Common Stock (pre-split), subject to adjustment (the “Series F Warrant Shares”). The Series F Conversion Price (as defined below) is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable Series F Conversion Price (subject to certain exceptions). Following the Reverse Stock Split, (i) the Series F Conversion Price was adjusted to $3.18 per share pursuant to the terms of the Series F Certificate of Designations, and (ii) the Series F Exercise Price (as defined below) was adjusted to $3.18 per share and the number of Series F Warrant Shares was adjusted proportionately to 4,716,904 shares pursuant to the terms of the Series F Warrants. In connection with the Private Placements (as defined herein), (i) the Series F Conversion Price of the Series F Preferred Stock was adjusted to $1.816 per share pursuant to the full ratchet anti-dilution provisions contained in the Series F Certificate of Designations and, (ii) the Series F Exercise Price of the Series F Warrants was adjusted to $1.816 per share and the number of shares of Common Stock issuable upon exercise of the Series F Warrants was adjusted proportionally to 8,259,911 shares pursuant to the full ratchet anti-dilution provisions contained in the Series F Warrants.

 

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At closing, we received net proceeds from the February 2023 Offering of approximately $14.1 million, after deducting various fees and expenses. We have used and intend to continue to use the net proceeds from this offering for general corporate purposes.

 

On November 7, 2024, each holder of the Series F Preferred Shares agreed that payment by the Company of any Installment Amounts (as defined in the Series F Certificate of Designations) that are accrued and are unredeemed, unconverted and/or otherwise unpaid as of November 7, 2024, will be deferred until December 1, 2024.

 

As of September 30, 2024, there were 4,675 Series F Preferred Shares outstanding and Series F Warrants outstanding to purchase up to 8,259,911 shares of Common Stock.

 

Series F Preferred Shares

 

The terms of the Series F Preferred Shares are as set forth in the form of Certificate of Designation. The Series F Preferred Shares became convertible upon issuance into the Series F Conversion Shares at the election of the holder at any time at an initial conversion price of $2.255 (pre-split) (the “Series F Conversion Price”). The Conversion Price is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable Conversion Price (subject to certain exceptions). Following the Reverse Stock Split, the Series F Conversion Price was adjusted to $3.18 per share pursuant to the terms of the Series F Certificate of Designations. The Series F Conversion Price was further adjusted to $1.816 per share pursuant to the full ratchet anti-dilutive provisions contained in the Series F Certificate of Designations in connection with the Private Placements (as defined herein).

 

Prior to the Series F Certificate of Amendment (as defined below), the Company was initially required to redeem the Series F Preferred Shares in 12 equal monthly installments, commencing on July 1, 2023. The amortization payments due upon such redemption are payable, at the Company’s election, in cash, or subject to certain limitations, in shares of Common Stock valued at the lower of (i) the Series F Conversion Price then in effect and (ii) the greater of (A) 80% of the average of the three lowest closing prices of the Company’s Common Stock during the thirty trading day period immediately prior to the date the amortization payment is due or (B) the Floor Price (as defined below). For purposes of the Series F Certificate of Designation, the “Floor Price” means $6.60 (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events) or, in any case, such lower amount as permitted, from time to time, by the Nasdaq Stock Market.

 

On April 5, 2024, the Company entered into an Omnibus Waiver and Amendment (the “Omnibus Agreement”) with the Required Holders (as defined in the Certificate of Designation). Pursuant to the Omnibus Agreement, the Required Holders agreed (i) to defer payment of the installment amounts due on March 1, 2024, and April 1, 2024 (the “Installments”), under Section 9(a) of the Series F Certificate of Designations, until May 1, 2024, and (ii) to waive any breach or violation of the February 2023 SPA, the Series F Certificate of Designations, or the Series F Warrants resulting from missing the Installments. The Company may require holders to convert their Series F Preferred Shares into Series F Conversion Shares if the closing price of the Company’s Common Stock exceeds $6.765 (as adjusted for the Reverse Stock Split) per share (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events) for 20 consecutive trading days and the daily dollar trading volume of the Company’s Common Stock exceeds $3,000,000 per day during the same period and certain equity conditions described in the Series F Certificate of Designations are satisfied.

 

On May 20, 2024, the Company entered into an Omnibus Waiver, Consent, Notice and Amendment (the “Series F Agreement”) with the Required Holders (as defined in the Series F Certificate of Designations). Pursuant to the Series F Agreement, the Required Holders agreed to (i) amend the Series F Purchase Agreement to amend certain terms relating to purchase rights thereunder, (ii) waive certain rights under the Series F Purchase Agreement and Series F Certificate of Designations in respect of the issuance of the Company’s Series F-1 Convertible Preferred Stock, with a par value of $0.001 per share and a stated value of $1,000 per share (“Series F-1 Preferred Stock”), the Company’s Series G Convertible Preferred Stock, with a par value of $0.001 per share and a stated value of $1,000 per share (“Series G Preferred Stock”), and entrance by the Company into the Purchase Agreements (as defined herein), (iii) waive the requirement that the Company reserve for issuance a sufficient number of shares of Common Stock as required by the Series F Certificate of Designations, the Series F Purchase Agreement and Series F Warrants, until such time as the Company obtains the Stockholder Approval (as defined herein), and (iv) consent to the issuance of the Series F-1 Preferred Stock and Series G Preferred Stock as required pursuant to certain terms of the Series F Certificate of Designations, the Series F Purchase Agreement and the Series F Warrants, as applicable. The Company and the Required Holders further agreed pursuant to the Series F Agreement, to amend the Series F Certificate of Designations by filing a Certificate of Amendment to the Series F Certificate of Designations (the “Series F Certificate of Amendment”) with the Secretary of State of the State of Delaware. The Series F Certificate of Amendment amends the Series F Certificate of Designations to (i) extend the maturity date to December 31, 2024, (ii) permit and modify certain procedures related to the payment of installment amounts with respect to the Installment Dates (as defined in the Series F Certificate of Designations) falling between (and including) July 1, 2024, and (and including) August 1, 2024, thereunder, and (iii) modify the schedule of Installment Dates.

 

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The holders of the Series F Preferred Shares are entitled to dividends of 10% per annum, compounded monthly, which are payable in cash or shares of the Company’s Common Stock at the Company’s option, in accordance with the terms of the Series F Certificate of Designations. Upon the occurrence and during the continuance of a Triggering Event (as defined in the Series F Certificate of Designations), the Series F Preferred Shares accrue dividends at the rate of 15% per annum. In connection with a Triggering Event, each holder of Series F Preferred Shares is able to require the Company to redeem in cash any or all of the holder’s Series F Preferred Shares at a premium set forth in the Certificate of Designation. Upon conversion or redemption, the holders of the Series F Preferred Shares are also entitled to receive a dividend make-whole payment. Except as required by applicable law, the holders of the Series F Preferred Shares are entitled to vote with holders of the Common Stock on as as-converted basis, with the number of votes to which each holder of Series F Preferred Shares is entitled to be calculated assuming a conversion price of $60.21 per share, which was the Minimum Price (as defined in Rule 5635 of the Rule of the Nasdaq Stock Market) applicable immediately before the execution and delivery of the February 2023 SPA, subject to certain beneficial ownership limitations as set forth in the Certificate of Designation. The Series F Certificate of Designations further provides that the holders of record of the Series F Preferred Shares, exclusively and as a separate class, shall be entitled to elect one director of the Company one time on or before June 30, 2024.

 

The Company is subject to certain affirmative and negative covenants regarding the incurrence of indebtedness, acquisition and investment transactions, the existence of liens, the repayment of indebtedness, the payment of cash in respect of dividends (other than dividends pursuant to the Series F Certificate of Designations), distributions or redemptions, and the transfer of assets, among other matters. There is no established public trading market for the Series F Preferred Shares and the Company does not intend to list the Series F Preferred Shares on any national securities exchange or nationally recognized trading system.

 

Series F Warrants

 

The Series F Warrants became exercisable immediately upon issuance, have an exercise price of $2.255 per share (pre-split) (as adjusted, the “Series F Exercise Price”) and expire five years from the date of issuance. The Series F Exercise Price is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment, on a “full ratchet” basis, in the event of any issuances of the Company’s Common Stock, or securities convertible, exercisable or exchangeable for the Company’s Common Stock, at a price below the then-applicable Exercise Price (subject to certain exceptions). Upon any such price-based adjustment to the Series F Exercise Price, the number of February 2023 Warrant Shares issuable upon exercise of the Series F Warrants will be increased proportionately. The Series F Warrants were issued with an initial Exercise Price of $2.255 per share (pre-split). Following the Reverse Stock Split, the Exercise Price for the Series F Warrants was adjusted to $3.18 per share and the number of February 2023 Warrant Shares was adjusted to 4,716,904 shares pursuant to the terms of the Series F Warrants. There is no established public trading market for the Series F Warrants and the Company does not intend to list the Series F Warrants on any national securities exchange or nationally recognized trading system. In connection with the Private Placements (as defined herein), the Series F Exercise Price was adjusted to $1.816 per share and the number of shares of Common Stock issuable upon exercise of the Series F Warrants was adjusted proportionally to 8,259,911 shares pursuant to the full ratchet anti-dilution provisions contained in the Series F Warrants.

 

On May 14, 2024, the Company entered into an Amendment (the “Series F Amendment”) with the Investors in the February 2023 Offering, effective as of March 31, 2024. The Series F Amendment amended certain terms of the Series F Warrants relating to the rights of the holders of the Series F Warrants to provide that, in the event of a Fundamental Transaction (as defined in the Series F Warrants) that is not within our control, including not approved by the Company’s Board of Directors, the holder of a Series F Warrant shall only be entitled to receive from the Company or any successor entity the same type or form of consideration (and in the same proportion), at the Black Scholes Value of the unexercised portion of such Series F Warrant, that is being offered and paid to the holders of our common stock in connection with the Fundamental Transaction, whether that consideration be in the form of cash, stock or any combination thereof, or whether the holders of Common Stock are given the choice to receive from among alternative forms of consideration in connection with the Fundamental Transaction; provided, further, that if holders of Common Stock of the Company are not offered or paid any consideration in such Fundamental Transaction, such holders of Common Stock will be deemed to have received common stock of the successor entity (which such successor entity may be the Company following such Fundamental Transaction) in such Fundamental Transaction..

 

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May 2024 Private Placements

 

Series F-1 Private Placement

 

On May 20, 2024, the Company entered into a Securities Purchase Agreement (the “Series F-1 Purchase Agreement”) with certain accredited investors (the “Series F-1 Investors”) pursuant to which it agreed to sell to the Series F-1 Investors (i) an aggregate of 5,050 shares of the Company’s newly-designated Series F-1 Preferred Stock, initially convertible into up to 2,780,839 shares of Common Stock at a conversion price of $1.816 per share, (ii) short-term warrants to acquire up to an aggregate of 2,780,839 shares of Common Stock (the “Series F-1 Short-Term Warrants”) at an exercise price of $1.816 per share, and (iii) warrants to acquire up to an aggregate of 2,780,839 shares of Common Stock (the “Series F-1 Long-Term Warrants,” and collectively with the Series F-1 Short-Term Warrants, the “Series F-1 Warrants”) at an exercise price of $1.816 per share (collectively, the “Series F-1 Private Placement”). The closing of the Series F-1 Private Placements occurred on May 23, 2024 (the “Series F-1 Closing Date”).

 

Series F-1 Preferred Stock

 

The Series F-1 Preferred Stock became convertible upon issuance into Common Stock (the “Series F-1 Conversion Shares”) at the election of the holder at any time at an initial conversion price of $1.816 (the “Series F-1 Conversion Price”). The Series F-1 Conversion Price is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable Series F-1 Conversion Price (subject to certain exceptions).

 

The Company is required to redeem the Series F-1 Preferred Stock in seven (7) equal monthly installments, commencing on December 1, 2024. The amortization payments due upon such redemption are payable, at the Company’s election, in cash at 105% of the applicable Installment Redemption Amount (as defined in the Series F-1 Certificate of Designations), or subject to certain limitations, in shares of Common Stock valued at the lower of (i) the Series F-1 Conversion Price then in effect and (ii) the greater of (A) 80% of the average of the three lowest closing prices of the Company’s Common Stock during the thirty consecutive trading day period ending and including the trading day immediately prior to the date the amortization payment is due or (B) $0.364, which is 20% of the “Minimum Price” (as defined in Nasdaq Stock Market Rule 5635) on the date in which the Series F-1 Stockholder Approval (as defined herein) was obtained or, in any case, such lower amount as permitted, from time to time, by the Nasdaq Capital Market, and, in each case, subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events, which amortization amounts are subject to certain adjustments as set forth in the Series F-1 Certificate of Designations (the “Series F-1 Floor Price”).

 

The holders of the Series F-1 Preferred Stock are entitled to dividends of 10% per annum, compounded monthly, which are payable in arrears monthly in cash or shares of Common Stock at the Company’s option, in accordance with the terms of the Series F-1 Certificate of Designations. Upon the occurrence and during the continuance of a Triggering Event (as defined in the Series F-1 Certificate of Designations), the Series F-1 Preferred Stock will accrue dividends at the rate of 15% per annum. Upon conversion or redemption, the holders of the Series F-1 Preferred Stock are also entitled to receive a dividend make-whole payment. The holders of the Series F-1 Preferred Stock are entitled to vote with holders of the Common Stock on as as-converted basis, with the number of votes to which each holder of Series F-1 Preferred Stock is entitled to be calculated assuming a conversion price of $2.253 per share, which was the Minimum Price applicable immediately before the execution and delivery of the Series F-1 Purchase Agreement, subject to certain beneficial ownership limitations as set forth in the Series F-1 Certificate of Designations.

 

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Notwithstanding the foregoing, the Company’s ability to settle conversions and make amortization and dividend make-whole payments using shares of Common Stock is subject to certain limitations set forth in the Series F-1 Certificate of Designations. Further, the Series F-1 Certificate of Designations contains a certain beneficial ownership limitation after giving effect to the issuance of shares of Common Stock issuable upon conversion of, or as part of any amortization payment or dividend make-whole payment under, the Series F-1 Certificate of Designations or Series F-1 Warrants.

 

Series F-1 Warrants

 

Pursuant to the Series F-1 Private Placement, the Company issued to investors (i) the Series F-1 Long-Term Warrants to purchase 2,780,839 shares of Common Stock, with an exercise price of $1.816 per share (subject to adjustment), for a period of five years from the date of issuance and (ii) the Series F-1 Short-Term Warrants to purchase 2,780,839 shares of Common Stock, with an exercise price of $1.816 per share (subject to adjustment), for a period of eighteen months from the date of issuance.

 

The exercise price of the Series F-1 Warrants and the number of shares issuable upon exercise of the Series F-1 Warrants are subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment, on a “full ratchet” basis, in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable exercise price (subject to certain exceptions). Upon any such price-based adjustment to the exercise price, the number of shares issuable upon exercise of the Series F-1 Warrants will be increased proportionately.

 

On August 16, 2024, the Company entered into (i) an Amendment (the “Series F-1 Long Term Warrant Amendment”) with the Series F-1 Investors, effective as of June 30, 2024 relating to the Series F-1 Long Term Warrants, and (ii) an Amendment (the “Series F-1 Short-Term Warrant Amendment” and, together with the Series F-1 Long Term Warrant Amendment, the “Series F-1 Warrant Amendments”) with the Series F-1 Investors, effective as of June 30, 2024 relating to the Series F-1 Short Term Warrants. The Series F-1 Warrant Amendments modified certain terms of the Series F-1 Warrants relating to the rights of the holders of the Series F-1 Warrants to provide that, in the event of a Fundamental Transaction (as defined in the Series F-1 Warrants) that is not within the Company’s control, including the Fundamental Transaction not being approved by the Company’s Board of Directors, the holder of the Series F-1 Warrant shall only be entitled to receive from the Company or any successor entity the same type or form of consideration (and in the same proportion), at the Black Scholes Value (as defined in the Series F-1 Warrants) of the unexercised portion of such Series F-1 Warrant, that is being offered and paid to the holders of the Company’s Common Stock in connection with the Fundamental Transaction. Additionally, the Series F-1 Warrant Amendments amend the definition of Black Scholes Value related to the volatility input which is now an expected volatility equal to the 30 day volatility, obtained from the “HVT” function on Bloomberg (determined utilizing a 365 day annualization factor) as of the trading day immediately following the earliest to occur of (1) the public disclosure of the applicable Fundamental Transaction and (2) the date of a holder’s request. The modification resulted in the reclassification of the Series F-1 Warrants to be considered equity classified as they were no longer in the scope of ASC 815. In accordance with ASC 815-40, the Company remeasured the Series F-1 Warrants at fair value as of July 25, 2024, the effective date of the modifications, and recognized the change in fair value as a non-cash loss and reclassified the Series F-1 Warrants to additional paid-in capital as of July 25, 2024.

 

Series G Private Placement

 

On May 20, 2024, the Company entered into a Securities Purchase Agreement (the “Series G Purchase Agreement”) and collectively with the Series F-1 Purchase Agreement, each a “Purchase Agreement” and collectively, the “Purchase Agreements”) with certain accredited investors (the “Series G Investors” and collectively with the Series F-1 Investors, the “Investors”), pursuant to which it agreed to sell to the Series G Investors (i) an aggregate of 8,950 shares of the Company’s newly-designated Series G Preferred Stock, initially convertible into up to 4,928,416 shares of the Company’s Common Stock, at a conversion price of $1.816 per share (ii) short-term warrants to acquire up to an aggregate of 4,928,416 shares of Common Stock (the “Series G Short-Term Warrants”) at an exercise price of $1.816 per share, and (iii) warrants to acquire up to an aggregate of 4,928,416 shares of Common Stock (the “Series G Long-Term Warrants,” and collectively with the Series G Short-Term Warrants, the “Series G Warrants”) at an exercise price of $1.816 per share (collectively, the “Series G Private Placement” and collectively with the Series F-1 Private Placement, each a “Private Placement” and collectively, the “Private Placements”). The closing of the Series G Private Placement occurred on May 23, 2024 (the “Series G Closing Date” and, together with the Series F-1 Closing Date, the “Closing Date”)).

 

Series G Preferred Stock

 

The Series G Preferred Shares became convertible upon issuance into Common Stock (the “Series G Conversion Shares”) at the election of the holder at any time at an initial conversion price of $1.816 (the “Series G Conversion Price”). The Series G Conversion Price is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable Series G Conversion Price (subject to certain exceptions). At any time after the issuance date of the Series G Preferred Shares, the Company has the option to redeem in cash all or any portion of the shares of Series G Preferred Shares then outstanding at a premium upon notice by the Company to all holders of the Series G Preferred Shares.

 

The holders of the Series G Preferred Shares will be entitled to dividends of 10% per annum, compounded monthly, which will be payable in arrears monthly at the holder’s option (i) in cash, (ii) “in kind” in the form of additional shares of Series G Preferred Shares (the “PIK Shares”) or (iii) in combination thereof, in each case, in accordance with the terms of the Certificate of Designations of the Series G Preferred Shares (the “Series G Certificate of Designations”). Upon the occurrence and during the continuance of a Triggering Event (as defined in the Series G Certificate of Designations), the Series G Preferred Stock will accrue dividends at the rate of 15% per annum. Upon conversion or redemption, the holders of the Series G Preferred Shares are also entitled to receive a dividend make-whole payment. The holders of the Series G Preferred Shares will be entitled to vote with holders of the Common Stock on as as-converted basis, with the number of votes to which each holder of Series G Preferred Share is entitled to be calculated assuming a conversion price of $2.253 per share, which was the Minimum Price (as defined in Rule 5635 of the Rule of the Nasdaq Stock Market) applicable immediately before the execution and delivery of the Series G Purchase Agreement, subject to certain beneficial ownership limitations as set forth in the Series G Certificate of Designations.

 

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Notwithstanding the foregoing, the Company’s ability to settle conversions and make dividend make-whole payments using shares of Common Stock is subject to certain limitations set forth in the Series G Certificate of Designations. Further, the Series G Certificate of Designations contains a certain beneficial ownership limitation, which applies to each Series G Investor other than PharmaCyte Biotech, Inc., after giving effect to the issuance of shares of Common Stock issuable upon conversion of the Series G Preferred Shares or as part of any dividend make-whole payment under the Series G Certificate of Designations.

 

On June 17, 2024, the Company entered into an Amendment Agreement (the “Series G Amendment”) with the Required Holders (as defined in the Series G Certificate of Designations). Pursuant to the Series G Amendment, the Required Holders agreed to amend the Series G Certificate of Designations by filing a Certificate of Amendment (“Series G Certificate of Amendment”) to the Series G Certificate of Designations with the Secretary of State of the State of Delaware (the “Secretary of State”) to increase the number of authorized shares of Series G Preferred Stock from 8,950 to 12,826,273, in order to authorize a sufficient number of shares of Series G Preferred Stock for the payment of PIK Shares. On June 17, 2024, the Company filed the Series G Certificate of Amendment with the Secretary of State, thereby amending the Series G Certificate of Designations. The Series G Certificate of Amendment became effective with the Secretary of State upon filing.

 

On August 8, 2024, the Company entered into an Amendment Agreement (the “August Series G Amendment”) with the Required Holders (as defined in the Series G Certificate of Designations). Pursuant to the August Series G Amendment, the Required Holders agreed to amend the Series G Certificate of Designations by filing a Certificate of Amendment (“August Series G Certificate of Amendment”) to the Series G Certificate of Designations with the Secretary of State to adjust the calculation of the PIK Shares. On August 8, 2024, the Company filed the August Series G Certificate of Amendment with the Secretary of State, thereby amending the Series G Certificate of Designations. The August Series G Certificate of Amendment became effective with the Secretary of State upon filing.

 

Series G Warrants

 

Pursuant to the Series G Private Placement, the Company issued to investors (i) the Series G Long-Term Warrants to purchase 4,928,416 shares of Common Stock, with an exercise price of $1.816 per share (subject to adjustment), for a period of five years from the date of issuance and (ii) the Series G Short-Term Warrants to purchase 4,928,416 shares of Common Stock, with an exercise price of $1.816 per share (subject to adjustment), for a period of eighteen months from the date of issuance.

 

The exercise price of the Series G Warrants and the number of shares issuable upon exercise of the Series G Warrants are subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment, on a “full ratchet” basis, in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable exercise price (subject to certain exceptions). Upon any such price-based adjustment to the exercise price, the number of shares issuable upon exercise of the Series G Warrants will be increased proportionately.

 

On August 16, 2024, the Company entered into (i) an Amendment (the “Series G Long Term Warrant Amendment”) with the Series G Investors, effective as of June 30, 2024 relating to the Series G Long Term Warrants, and (ii) an Amendment (the “Series G Short Term Warrant Amendment” and, together with the Series G Long Term Warrant Amendment, the “Series G Warrant Amendments”) with the Series G Investors, effective as of June 30, 2024 relating to the Series G Short Term Warrants. The Series G Warrant Amendments modified certain terms of the Series G Warrants relating to the rights of the holders of the Series G Warrants to provide that, in the event of a Fundamental Transaction (as defined in the Series G Warrants) that is not within the Company’s control, including the Fundamental Transaction not being approved by the Company’s Board of Directors, the holder of the Series G Warrant shall only be entitled to receive from the Company or any successor entity the same type or form of consideration (and in the same proportion), at the Black Scholes Value (as defined in the Series G Warrants) of the unexercised portion of such Series G Warrant, that is being offered and paid to the holders of the Company’s Common Stock in connection with the Fundamental Transaction. Additionally, the Series G Warrant Amendments amend the definition of Black Scholes Value related to the volatility input which is now an expected volatility equal to the 60 day volatility, obtained from the “HVT” function on Bloomberg (determined utilizing a 365 day annualization factor) as of the trading day immediately following the earliest to occur of (1) the public disclosure of the applicable Fundamental Transaction and (2) the date of a holder’s request. The modification resulted in the reclassification of the Series G Warrants to be considered equity classified as they were no longer in the scope of ASC 815. In accordance with ASC 815-40, the Company remeasured the Series G Warrants at fair value as of July 25, 2024, the effective date of the modifications, and recognized the change in fair value as a non-cash gain and reclassified the warrant liability to additional paid-in capital as of July 25, 2024.

 

Private Placement Warrants

 

In connection with the Private Placements, pursuant to (A) an engagement letter (the “GPN Agreement”) with GP Nurmenkari Inc. (“GPN”) and (B) an engagement letter (the “Palladium Agreement,” and collectively with the GPN Agreement, the “Engagement Letters”) with Palladium Capital Group, LLC (“Palladium,” and collectively with GPN, the “Placement Agents”), the Company engaged the Placement Agents to act as non-exclusive placement agents in connection with each Private Placement, pursuant to which, the Company agreed to (i) pay the Placement Agents a cash fee equal to 3% of the gross proceeds of each Private Placement (including any cash proceeds realized by the Company from the exercise of the Series F Warrants), (ii) reimbursement and payment of certain expenses, and (iii) issue to the Placement Agents on the Closing Date, warrants to purchase up to an aggregate of 693,833 of shares of Common Stock to each Placement Agent, which is equal to 3% of the aggregate number of shares of Common Stock underlying the securities issued in each Private Placement, including upon exercise of any Series F Warrants, with terms identical to the Series G Long-Term Warrants and Series F-1 Long-Term Warrants.

 

Registration Rights Agreements

 

In connection with the Series G Private Placement, we entered into a Registration Rights Agreement with the Series G Investors (the “Series G Registration Rights Agreement”), pursuant to which we agreed to file a resale registration statement (the “Series G Registration Statement”) with the SEC to register for resale (A) 200% of the Series G Conversion Shares, (B) 200% of the shares of common stock issuable upon conversion of the PIK Shares, and (C) 200% of the Series G Warrant Shares promptly following the Closing Date, but in no event later than 30 calendar days after the Closing Date, and to have such Series G Registration Statement declared effective by the Effectiveness Deadline (as defined in the Series G Registration Rights Agreement).

 

In connection with the Series F-1 Private Placement, we entered into a Registration Rights Agreement with the Series F-1 Investors (the “Series F-1 Registration Rights Agreement,” and, together with the Series G Registration Rights Agreement, the “Registration Rights Agreements”), pursuant to which we agreed to file a resale registration statement (the “Series F-1 Registration Statement”) with the SEC to register for resale (A) 200% of the Series F-1 Conversion Shares and (B) 200% of the Series F-1 Warrant Shares promptly following the Closing Date, but in no event later than 30 calendar days after the Closing Date, and to have such Series F-1 Registration Statement declared effective by the Effectiveness Deadline (as defined in the Series F-1 Registration Rights Agreement).

 

In connection with the Registration Rights Agreements, the Company filed a registration statement on Form S-3 covering such securities, which registration statement was filed on June 21, 2024, amended on August 8, 2024 and declared effective by the SEC on August 12, 2024. Under the Series F-1 Registration Rights Agreement, we are obligated to pay certain liquidated damages to the Series F-1 Investors if the Company, among other things, fails to maintain the effectiveness of the Series F-1 Registration Statement.

 

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Critical Accounting Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions about future events that affect the amounts reported in the financial statements and accompanying notes. Future events and their effects cannot be determined with absolute certainty. Therefore, the determination of estimates requires the exercise of judgment. Actual results inevitably will differ from those estimates, and such differences may be material to the financial statements. The most significant accounting estimates inherent in the preparation of our financial statements include estimates associated with the determinations of the fair-market value of the preferred stock, stock-based compensation, and the impairment analysis of intangibles.

 

Our financial position, results of operations and cash flows are impacted by the accounting policies we have adopted. In order to get a full understanding of our financial statements, one must have a clear understanding of the accounting policies employed. A summary of our critical accounting policies is presented within the notes to our consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q.

 

Our management’s discussion and analysis of financial condition and results of operations is based on our financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of our financial statements and related disclosures requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, costs and expenses, and the disclosure of contingent assets and liabilities in our financial statements. These items are monitored and analyzed by us for changes in facts and circumstances, and material changes in these estimates could occur in the future. We base our estimates on historical experience, known trends and events, and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may materially differ from these estimates under different assumptions or conditions.

 

Our critical accounting estimates have not changed materially from those previously reported in our Annual Report for the year ended December 31, 2023, on Form 10-K, as filed with the SEC on April 1, 2024.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

 

Not applicable.

 

Item 4. Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

Our principal executive officer and principal financial officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in the Securities Exchange Act of 1934, as amended (the “Exchange Act”) Rule 13a-15(e) and 15d-15(e)) as of the end of the period covered by this Quarterly Report on Form 10-Q, have concluded that, based on such evaluation, our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and is accumulated and communicated to our management, including our principal executive officer and principal financial officer as appropriate to allow timely decisions regarding required disclosure.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting that occurred during our last fiscal quarter ended September 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

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PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings

 

From time to time we are party to litigation and subject to claims incident to the ordinary course of business. Future litigation may be necessary to defend ourselves and our customers by determining the scope, enforceability, and validity of third-party proprietary rights or to establish our proprietary rights. For a description of certain legal proceedings, please read Note 7 to the interim condensed consolidated financial statements, which information is incorporated herein by reference.

 

Item 1A. Risk Factors

 

The following description of risk factors includes any material changes to, and supersedes the description of, risk factors associated with our business, financial condition and results of operations previously disclosed in “Item 1A. Risk Factors” of our Annual Report for the year ended December 31, 2023 on Form 10-K, as filed with the SEC on April 1, 2024. Our business, financial condition and operating results can be affected by a number of factors, whether currently known or unknown, including but not limited to those described below, any one or more of which could, directly or indirectly, cause our actual financial condition and operating results to vary materially from past, or from anticipated future, financial condition and operating results. Any of these factors, in whole or in part, could materially and adversely affect our business, financial condition, operating results and stock price.

 

The following discussion of risk factors contains forward-looking statements. These risk factors may be important to understanding other statements in this Form 10-Q. The following information should be read in conjunction with the condensed consolidated financial statements and related notes in Part I, Item 1, “Financial Statements” and Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Form 10-Q.

 

Holders of our Series F Preferred Stock, Series F-1 Preferred Stock and Series G Preferred Stock are entitled to certain payments under the applicable Certificate of Designations that may be paid in cash, in shares of Common Stock or in additional shares of Series G Preferred Stock depending on the circumstances. If we make these payments in cash, it may require the expenditure of a substantial portion of our cash resources. If we make these payments in Common Stock, it may result in substantial dilution to the holders of our Common Stock.

 

Under the Series F Certificate of Designations and Series F-1 Certificate of Designations, we are required to redeem the shares of the shares of the Series F Preferred Stock and Series F-1 Preferred Stock in equal monthly installments commencing July 1, 2023, and December 1, 2024, respectively. Such holders are also entitled to receive dividends, payable in arrears monthly, and dividends payable on installment dates shall be paid as part of the applicable installment amount. Installment amounts are payable, at the Company’s election, in shares of Common Stock or, subject to certain limitations, in cash. Installment amounts paid in cash must be paid in the amount of 105% of the applicable payment amount due.

 

Our ability to make payments due to the holders of our Series F Preferred Stock and Series F-1 Preferred Stock using shares of Common Stock is subject to certain limitations set forth in the applicable Certificate of Designations. If we are unable to make installment payments in shares of Common Stock, we may be forced to make such payments in cash. Additionally, the holders of the Series G Preferred Stock are entitled to dividends of 10% per annum, compounded monthly, which are payable in arrears monthly, at the holder’s sole discretion, in cash, or “in kind” in the form of additional Series G Preferred Stock, or a combination thereof. If we do not have sufficient cash resources to make these payments, we may need to raise additional equity or debt capital, and we cannot provide any assurance that we will be successful in doing so. If are unable to raise sufficient capital to meet our payment obligations, we may need to delay, reduce or eliminate certain research and development programs or other operations, sell some or all of our assets or merge with another entity.

 

Our ability to make payments due to the holders of our Series F Preferred Stock, Series G Preferred Stock, Series F-1 Preferred Stock using cash is also limited by the amount of cash we have on hand at the time such payments are due as well as certain provisions of the Delaware General Corporation Law (the “DGCL”). Further, we intend to make the installment payments due to holders of Series F Preferred Stock and Series F-1 Preferred Stock in the form of Common Stock to the extent allowed under the applicable Certificate of Designation and applicable law in order to preserve our cash resources. The issuance of shares of Common Stock to the holders of our Series F Preferred Stock and Series F-1 Preferred Stock with increase the number of shares of Common Stock outstanding and could result in substantial dilution to the existing holders of our Common Stock.

 

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The Certificate of Designations for the Series F Preferred Stock, Series F-1 Preferred Stock and Series G Preferred Stock and the warrants issued concurrently therewith contain anti-dilution provisions that may result in the reduction of the conversion price of the applicable preferred stock or the exercise price of such warrants in the future. These features may increase the number of shares of Common Stock being issuable upon conversion of the Series F Preferred Stock, Series F-1 Preferred Stock and Series G Preferred Stock or upon the exercise of the warrants.

 

The Series F Certificate of Designations, Series F-1 Certificate of Designations and Series G Certificate of Designations and the warrants issued concurrently therewith, contain anti-dilution provisions, which provisions require the lowering of the applicable conversion price or exercise, as then in effect, to the purchase price of equity or equity-linked securities issued in subsequent offerings. If in the future, while any of our Series F Preferred Stock, Series F-1 Preferred Stock, Series G Preferred Stock, Series F Warrants, Series F-1 Warrants or Series G Warrants are outstanding, we issue securities for a consideration per share of Common Stock (the “New Issuance Price”) that is less than the applicable conversion price of our preferred stock or the exercise price of the Series F Warrants, Series F-1 Warrants or Series G Warrants, as then in effect, we will be required, subject to certain limitations and adjustments as provided in the applicable Certificate of Designations or the applicable warrants, to reduce the conversion price or the exercise price to be equal to the New Issuance Price, which will result in a greater number of shares of Common Stock being issuable upon conversion or exercise, as applicable, which in turn will increase the dilutive effect of such conversion or exercise on existing holders of our Common Stock. It is possible that we will not have a sufficient number of shares available to satisfy the conversion of the Series F Preferred Stock, Series F-1 Preferred Stock or Series G Preferred Stock or the exercise of the Series F Warrants, Series F-1 Warrants or Series G Warrants if we enter into a future transaction that reduces the applicable conversion price or exercise price. If we do not have a sufficient number of available shares for any such conversions or any such warrant exercises, we may need to seek shareholder approval to increase the number of authorized shares of our Common Stock, which may not be possible and will be time consuming and expensive. The potential for such additional issuances may depress the price of our Common Stock regardless of our business performance and may make it difficult for us to raise additional equity capital while any of our Series F Preferred Stock, Series F-1 Preferred Stock, Series G Preferred Stock or Series F Warrants, Series F-1 Warrants or Series G Warrants are outstanding.

 

Under the February 2023 SPA and Purchase Agreements, we are subject to certain restrictive covenants that may make it difficult to procure additional financing.

 

The February 2023 SPA, pursuant to which we issued the Series F Preferred Stock, contains, among others, the following restrictive covenants: (i) until all of the Series F Warrants are exercised, we agreed not to enter into any variable rate transactions; and (ii) until the later of no shares of Series F Preferred Stock being outstanding and the maturity date of the Series F Preferred Stock, the opportunity to participate in any subsequent securities offerings by us. The Series F-1 Purchase Agreement, pursuant to which we issued the Series F-1 Preferred Stock, contains, among others, the following restrictive covenants: (i) until all of the Series F-1 Warrants are exercised, we agreed not to enter into any variable rate transactions; and (ii) until the later of no shares of Series F-1 Preferred Stock being outstanding and the maturity date, the opportunity to participate in any subsequent securities offerings by us. The Series G Purchase Agreement, pursuant to which we issued the Series G Preferred Stock, contains, among others, the following restrictive covenants: (i) until all of the Series G Warrants are exercised, we agreed not to enter into any variable rate transactions; and (ii) until the later of no shares of Series G Preferred Stock being outstanding and the second anniversary of the Series G Closing Date, the opportunity to participate in any subsequent securities offerings by us.

 

If we require additional funding while these restrictive covenants remain in effect, we may be unable to effect a financing transaction while remaining in compliance with the terms of the February 2023 SPA or Purchase Agreements, or we may be forced to seek a waiver from the investors party to the February 2023 SPA and Purchase Agreements.

 

We may not be able to adequately protect or enforce our intellectual property rights, which could harm our competitive position.

 

Our success and future revenue growth will depend, in part, on our ability to protect our intellectual property. We will primarily rely on patent, copyright, trademark, and trade secret laws, as well as nondisclosure agreements and other methods, to protect our proprietary technologies or processes. It is possible that competitors or other unauthorized third parties may obtain, copy, use or disclose proprietary technologies and processes, despite efforts by the us to protect our proprietary technologies and processes. While we hold rights in several patents, there can be no assurances that any additional patents will be issued, or additional rights will be granted, to us. Even if new patents are issued, the claims allowed may not be sufficiently broad to adequately protect our technology and processes. Our competitors may also be able to develop similar technology independently or design around the patents to which we have rights.

 

Currently, the Company has 17 issued U.S. patents, 68 foreign patents, two pending U.S. patent applications and 7 foreign patent applications pending in such jurisdictions as Australia, Canada, China, European Union, Israel, Japan, and South Korea and one pending international patent application, which if issued are expected to expire between 2036 and 2041. Although we expect to obtain additional patents and in-licenses in the future, there is no guarantee that we will be able to successfully obtain such patents or in-licenses in a timely manner or at all. Further, any of our rights to existing patents, and any future patents issued to us, may be challenged, invalidated, or circumvented. As such, any rights granted under these patents may not provide us with meaningful protection. Even if foreign patents are granted, effective enforcement in foreign countries may not be available. If our patents or rights to patents do not adequately protect our technology or processes, competitors may be able to offer products similar to our products.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

There were no unregistered sales of the Company’s equity securities during the three months ended September 30, 2024, other than those previously reported in a Current Report on Form 8-K.

 

Item 3. Defaults Upon Senior Securities

 

There has been no default in the payment of principal, interest, sinking or purchase fund installment, or any other material default, with respect to any indebtedness of the Company.

 

Item 4. Mine Safety Disclosures

 

Not applicable.

 

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Item 5. Other Information.

 

None.

 

Item 6. Exhibits.

 

Exhibit

Number

   Exhibit Description
     
3.1   Certificate of Amendment of Certificate of Incorporation of TNF Pharmaceuticals, Inc (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 26, 2024).
     
3.2   Certificate of Amendment of Certificate of Incorporation of TNF Pharmaceuticals, Inc (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 26, 2024).
     
10.1   Stock Purchase Agreement, dated as of October 1, 2024, by and between TNF Pharmaceuticals, Inc. and Prevail Partners, LLC (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on October 7, 2024).
     
31.1+   Certification of the Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).
     
31.2+   Certification of the Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).
     
32.1*   Certification of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
     
32.2*   Certification of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
     
101   Interactive Data Files of Financial Statements and Notes.
     
101.INS   Inline XBRL Instance Document
     
101.SCH   Inline XBRL Taxonomy Extension Schema Document
     
101.CAL   Inline XBRL Taxonomy Extension Calculation Linkbase Document
     
101.DEF   Inline XBRL Taxonomy Extension Definition Linkbase Document
     
101.LAB   Inline XBRL Taxonomy Extension Label Linkbase Document
     
101.PRE   Inline XBRL Taxonomy Extension Presentation Linkbase Document
     
104   Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

+ Filed herewith

 

* Furnished herewith

 

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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.

 

  TNF PHARMACEUTICALS, INC.
     
Date: November 14, 2024 By: /s/ Mitchell Glass                                 
  Name:  Mitchell Glass
  Title: President, Chief Medical Officer, and Director
    (Principal Executive Officer)
     
Date: November 14, 2024 By: /s/ Ian Rhodes
  Name: Ian Rhodes
  Title: Interim Chief Financial Officer
    (Principal Financial Officer)

 

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