What changed in this filing

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Item 1. Financial Statements

2023-05-12 compared with 2023-02-13 · 310 added, 219 removed, 564 unchanged (48% of the section changed)

7 unchanged sentences

Accounts receivable

Prepaid and other assets

Total current assets

5 unchanged sentences

Accounts payable

Accrued expenses

Accrued expenses and other liabilities

Deferred revenue

5 unchanged sentences

Preferred stock, $ 0.001 par value;

10,000,000 shares authorized as of December 31, 2022 and September 30, 2022;

no shares issued or outstanding as of December 31, 2022 and September 30, 2022.

10,000,000 shares authorized as of March 31, 2023 and September 30, 2022;

no shares issued or outstanding as of March 31, 2023 and September 30, 2022.

Common stock, $ 0.001 par value;

100,000,000 shares authorized as of December 31, 2022 and September 30, 2022;

16,238,464 and 16,216,540 shares issued and outstanding as of December 31, 2022 and September 30, 2022, respectively.

100,000,000 shares authorized as of March 31, 2023 and September 30, 2022;

16,887,738 and 16,216,540 shares issued and outstanding as of March 31, 2023 and September 30, 2022, respectively.

Additional paid–in capital

7 unchanged sentences

Condensed Statements of Operations

For the three months ended

Three Months Ended

Six Months Ended

Product revenue

Cost of product revenue

Product gross loss

Product gross profit (loss)

Collaborations revenue

6 unchanged sentences

( 3,059,810 )

( 5,280,271 )

( 5,869,135 )

Other (expense) income, net

Loss before income taxes

1 unchanged sentence

( 3,058,067 )

( 5,255,597 )

( 5,865,542 )

Provision for income taxes

1 unchanged sentence

$ ( 3,058,067 )

$ ( 5,255,597 )

$ ( 5,865,542 )

Net loss per share:

2 unchanged sentences

Basic and diluted

See accompanying notes to condensed financial statements

NeuroOne Medical Technologies Corporation

See accompanying notes to condensed financial

NeuroOne Medical

Technologies Corporation

Condensed Statements of Changes in Stockholders’

12 unchanged sentences

( 43,634,674 )

Stock-based compensation

Issuance of common stock upon vesting of restricted stock units

( 3,058,067 )

Balance at March 31, 2022

$ ( 46,692,741 )

Balance at September 30, 2022

6 unchanged sentences

( 52,559,581 )

See accompanying notes to condensed financial statements

Issuance of common stock in connection with at-the-market offering program

Issuance costs in connection with the at-the-market offering program

Stock-based compensation

Share repurchases for the payment of employee taxes

Issuance of common stock upon vesting of restricted stock units

( 3,522,828 )

Balance at March 31, 2023

$ ( 56,082,409 )

See accompanying notes to condensed financial

NeuroOne Medical Technologies Corporation

Condensed Statements of Cash Flows

For the three months ended

Six Months Ended

Operating activities

8 unchanged sentences

Accounts receivable

Prepaid and other assets

Accounts payable

Deferred revenue

Accrued expenses, deferred revenue, operating leases and other liabilities

( 1,669,283 )

Accrued expenses, operating leases and other liabilities

Net cash used in operating activities

5 unchanged sentences

Maturities of short-term investments

Purchase of property and equipment

Purchase of fixed assets

Net cash provided by (used in) investing activities

Financing activities

Proceeds from issuance of common stock attributed to the public offering

Deferred issuance costs related to the at-the-market offering program and issuance costs related to the public offering

Proceeds from issuance of common stock in connection with at-the-market offering program and public offering

Issuance costs related to at-the-market offering program and public offering

( 1,327,300 )

Net cash (used in) provided by financing activities

Net (decrease) increase in cash

Share repurchases for the payment of employee taxes

Net cash provided by financing activities

Net (decrease) increase in cash and cash equivalents

( 4,558,166 )

Cash at beginning of period

Cash at end of period

Cash and cash equivalents at beginning of period

Cash and cash equivalents at end of period

Supplemental non-cash financing and investing transactions:

Unpaid deferred offering and issuance costs attributed to the at-the-market offering program and public offering

Modification of right-of-use asset and associated lease liability

Reclass of deferred offering costs to additional paid-in capital in connection with public offering

See accompanying notes to condensed financial statements

Modification of right-of-use asset and associated lease liability

Purchased fixed assets in accounts payable

See accompanying notes to condensed financial

NeuroOne Medical Technologies Corporation

2 unchanged sentences

Basis of Presentation

NeuroOne Medical Technologies Corporation

(the “Company” or “NeuroOne”), a Delaware corporation, is an early-stage medical technology company developing

comprehensive neuromodulation electroencephalogram (cEEG) and stereoelectrocencephalography (sEEG) recording, monitoring, ablation, and

brain stimulation solutions to diagnose and treat patients with epilepsy, Parkinson’s disease, dystonia, essential tremors, chronic

pain due to failed back surgeries and other related neurological disorders.

NeuroOne Medical Technologies Corporation (the

“Company” or “NeuroOne”), a Delaware corporation, is an early-stage medical technology company developing comprehensive

neuromodulation electroencephalogram (cEEG) and stereoelectrocencephalography (sEEG) recording, monitoring, ablation, and brain stimulation

solutions to diagnose and treat patients with epilepsy, Parkinson’s disease, dystonia, essential tremors, chronic pain due to failed

back surgeries and other related neurological disorders.

The Company received 510(k) clearance from the

7 unchanged sentences

Generally, worldwide economic conditions remain

uncertain, particularly due to the effects of the COVID-19 pandemic and increased inflation.

The general economic and capital market conditions

both in the U.S.

and worldwide, have been volatile in the past and at times have adversely affected the Company’s access to capital

and increased the cost of capital.

The capital and credit markets may not be available to support future capital raising activity on favorable

terms or at all.

If economic conditions continue to decline, the Company’s future cost of equity or debt capital and access to the

capital markets could be adversely affected.

uncertain, particularly due to the conflict between Russia and Ukraine, disruptions in the banking system and financial markets, lingering

effects of the COVID-19 pandemic and increased inflation.

The general economic and capital market conditions both in the U.S.

and worldwide,

have been volatile in the past and at times have adversely affected the Company’s access to capital and increased the cost of capital.

The capital and credit markets may not be available to support future capital raising activity on favorable terms or at all.

conditions continue to decline, the Company’s future cost of equity or debt capital and access to the capital markets could be adversely

The COVID-19 pandemic that began in late 2019

3 unchanged sentences

Changes in economic conditions, supply chain constraints, logistics challenges, labor shortages, the conflict

in Ukraine, and steps taken by governments and central banks, particularly in response to the COVID-19 pandemic as well as other stimulus

and spending programs, have led to higher inflation, which has led to an increase in costs and has caused changes in fiscal and monetary

policy, including increased interest rates.

in Ukraine, disruptions in the banking system and financial markets, and steps taken by governments and central banks, particularly in

response to the COVID-19 pandemic as well as other stimulus and spending programs, have led to higher inflation, which has led to an increase

in costs and has caused changes in fiscal and monetary policy, including increased interest rates.

Basis of presentation

23 unchanged sentences

The Company has incurred

losses since inception, negative cash flows from operations, and an accumulated deficit of $ 52.6 million as of December 31, 2022.

losses since inception, negative cash flows from operations, and an accumulated deficit of $ 56.1 million as of March 31, 2023.

the Company’s revenues have not been sufficient to cover its full operating costs, and as such, has been dependent on funding operations

through the issuance of debt and sale of equity securities.

The Company does not have adequate liquidity to fund its operations without

raising additional funds and such actions are not solely within the control of the Company.

These factors raise substantial doubt about

the Company’s ability to continue as a going concern.

The financial statements do not include any adjustments that might result

from the outcome of this condition.

If the Company is unable to raise additional funds, or the Company’s anticipated operating results

are not achieved, management believes planned expenditures may need to be reduced in order to extend the time period that existing resources

can fund the Company’s operations.

The Company intends to fund ongoing activities by utilizing its current cash, cash equivalents

and short-term investments on hand, from product and collaborations revenue and by raising additional capital through equity or debt financings.

If management is unable to obtain the necessary capital, it may have a material adverse effect on the operations of the Company and the

development of its technology, or the Company may have to cease operations altogether.

The Company does not have adequate liquidity to fund its operations beginning

in the fourth quarter of calendar year 2023 without raising additional funds and such actions are not solely within the control of the

These factors raise substantial doubt about the Company’s ability to continue as a going concern.

The financial statements

do not include any adjustments that might result from the outcome of this condition.

If the Company is unable to raise additional funds,

or the Company’s anticipated operating results are not achieved, management believes planned expenditures may need to be reduced

in order to extend the time period that existing resources can fund the Company’s operations.

The Company intends to fund ongoing

activities by utilizing its current cash, cash equivalents and short-term investments on hand, from product and collaborations revenue

and by raising additional capital through equity or debt financings.

If management is unable to obtain the necessary capital, it may have

a material adverse effect on the operations of the Company and the development of its technology, or the Company may have to cease operations

NOTE 3 – Summary of Significant Accounting

17 unchanged sentences

The Company has experienced no credit losses from its cash and cash equivalent

Short Term Investment

Short-Term Investments

The Company invests its excess cash in United

4 unchanged sentences

and are recorded at amortized cost, which approximates fair value due to the negligible risk of changes in value due to interest rates.

All investments held as of December 31, 2022 and September 30, 2022 had contractual maturities of less than one year.

All investments held as of March 31, 2023 and September 30, 2022 had contractual maturities of less than one year.

The amortized cost

and estimated fair values of the Company’s investments as of December 31, 2022 and September 30, 2022 are as follows:

December 31, 2022

and estimated fair values of the Company’s investments as of March 31, 2023 and September 30, 2022 are as follows:

March 31, 2023

treasury and corporate notes

20 unchanged sentences

of each customer contract, performance obligations are identified and the total transaction price is allocated to the performance obligations.

The Company commenced commercial sales of cEEG strip/grid and electrode cable assembly products in the first quarter of fiscal year 2021.

of Product Revenue

product revenue consists of the manufacturing and materials costs incurred by the Company’s third-party contract manufacturer in

connection with the Company’s strip and grid cortical electrodes (the “Strip/Grid Products”) and outside supplier materials

costs in connection with the electrode cable assembly products (“Electrode Cable Assembly Products”) .

In addition, cost of product revenue includes royalty fees incurred in connection with the Company’s license agreements.

connection with the Company’s strip and grid cortical electrodes (the “Strip/Grid Products”), depth electrodes (“sEEG

Products) and outside supplier materials costs in connection with the electrode cable assembly products (“Electrode Cable

Assembly Products”) .

In addition, cost of product revenue includes royalty fees incurred in

connection with the Company’s license agreements.

Collaborations

20 unchanged sentences

Notes to Condensed Financial Statements

of intellectual property :

If the license to the Company’s intellectual property is determined to be distinct from the other

performance obligations identified in the arrangement, the Company recognizes revenues from non-refundable, up-front fees allocated to

the license when the license is transferred to the customer, and the customer can use and benefit from the license.

For licenses that

are bundled with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine

whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of

measuring progress for purposes of recognizing revenue from non-refundable, up-front fees.

The Company evaluates the measure of progress

each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition.

Licenses of intellectual property :

If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified

in the arrangement, the Company recognizes revenues from non-refundable, up-front fees allocated to the license when the license is transferred

to the customer, and the customer can use and benefit from the license.

For licenses that are bundled with other promises, the Company

utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation

is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing

revenue from non-refundable, up-front fees.

The Company evaluates the measure of progress each reporting period and, if necessary, adjusts

the measure of performance and related revenue recognition.

At the inception of each arrangement that includes milestone payments, the Company evaluates whether the milestones are

26 unchanged sentences

Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date.

As of December 31, 2022 and September 30, 2022,

the fair values of cash, cash equivalents, short-term investments, accounts receivable, inventory, prepaid and other assets, accounts

payable and accrued expenses approximated their carrying values because of the short-term nature of these assets or liabilities.

As of March 31, 2023 and September 30, 2022, the

fair values of cash, cash equivalents, short-term investments, accounts receivable, inventory, prepaids, accounts payable and accrued

expenses approximated their carrying values because of the short-term nature of these assets or liabilities.

There were no transfers between fair value hierarchy

levels during the three months ended December 31, 2022 and 2021.

levels during the three or six months ended March 31, 2023 and 2022.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

has entered into two licensing agreements with major research institutions, which allow for access to certain patented technology

2 unchanged sentences

life of the acquired technology.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

and Equipment

34 unchanged sentences

useful lives, and estimated future demand of the products and spare parts.

The Company’s inventory is currently comprised of cEEG

strip/grid and electrode cable assembly work-in-process and finished good product.

The Strip/Grid Products are produced by a third-party

contract manufacturer and the Electrode Cable Assembly Products are obtained from outside suppliers.

The Company’s inventory is currently comprised of Strip/Grid,

sEEG and electrode cable assembly work-in-process and finished good product.

The Strip/Grid Products and sEEG Products are produced by

a third-party contract manufacturer and the Electrode Cable Assembly Products are obtained from outside suppliers.

and Development Costs

6 unchanged sentences

than when payment is made, in accordance with ASC 730, Research and Development .

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

General and Administrative

4 unchanged sentences

financial matters, and sales and marketing in connection with the commercial sales of the Company’s products.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

Stock-Based Compensation

20 unchanged sentences

The Company’s warrants, stock options, and restricted

stock units are considered common stock equivalents for this purpose.

Diluted earnings is computed utilizing the treasury method for the

warrants, stock options and restricted stock units.

No incremental common stock equivalents were included in calculating diluted loss

per share because such inclusion would be anti-dilutive given the net loss reported for both the three months ended December 31, 2022

stock units while outstanding are considered common stock equivalents for this purpose.

Diluted earnings or loss per share of common stock

is computed utilizing the treasury method for the warrants, stock options and restricted stock units.

No incremental common stock equivalents

were included in calculating diluted loss per share because such inclusion would be anti-dilutive given the net loss reported for the

three and six months ended March 31, 2023 and 2022.

The following potential common shares were not

considered in the computation of diluted net loss per share as their effect would have been anti-dilutive for the three months ended December

considered in the computation of diluted net loss per share as their effect would have been anti-dilutive for the three and six months

ended March 31, 2023 and 2022:

Stock options

Restricted stock units

Unissued vested restricted stock units

Recent Accounting Pronouncements

12 unchanged sentences

ASU will have a material impact on its financial statements.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

In August 2020, FASB issued ASU 2020-06 , Debt—Debt

13 unchanged sentences

Company adopted ASU 2020-06 effective October 1, 2022 and the ASU did not have a material impact to our financial statements.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

NOTE 4 - Commitments and Contingencies

20 unchanged sentences

The Company expects the latest expiration of a licensed patent to occur in 2030.

During the three months ended December

31, 2022 and 2021, $ 37,500 and $ 25,000 in royalty fees were incurred related to the WARF License, respectively and

were reflected as a component of cost of product revenue.

has an exclusive license and development agreement with the Mayo Foundation for Medical Education and Research (“Mayo”) related

to certain intellectual property and development services for thin film micro electrode technology (“Mayo Agreement”).

the Company is successful in obtaining regulatory approval, the Company is to pay royalties to Mayo based on a percentage of net sales

of products of the licensed technology through the term of the Mayo Agreement, set to expire May 25, 2037.

During the three

months ended December 31, 2022 and 2021, $ 690 and $ 739 in royalty fees were incurred related to the Mayo Agreement, respectively, and

were reflected as a component of cost of product revenue.

During the three months ended March

31, 2023 and 2022, $ 37,500 in royalty fees were incurred related to the WARF License during each of these periods.

During the six months

ended March 31, 2023 and 2022, $ 75,000 and $ 62,500 in royalty fees were incurred related to the WARF License, respectively.

fees were reflected as a component of cost of product revenue.

The Company has an exclusive license and development

agreement with the Mayo Foundation for Medical Education and Research (“Mayo”) related to certain intellectual property and

development services for thin film micro electrode technology (“Mayo Agreement”).

If the Company is successful in obtaining

regulatory approval, the Company is to pay royalties to Mayo based on a percentage of net sales of products of the licensed technology

through the term of the Mayo Agreement, set to expire May 25, 2037.

During the three months ended March 31, 2023 and 2022,

zero and $ 1,097 in royalty fees were incurred related to the Mayo Agreement, respectively.

During the six months ended March 31,

2023 and 2022, $ 690 and $ 1,836 in royalty fees were incurred related to the Mayo Agreement, respectively.

The royalty fees were

reflected as a component of cost of product revenue.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

Facility Leases

24 unchanged sentences

The rent under the extended Los Gatos Lease ranges from $ 4,453 to $ 4,632 per month beginning on January 1, 2023.

During the three months ended December 31, 2022

and 2021, rent expense associated with the facility leases amounted to $ 42,474 and $ 43,045 , respectively.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

During the three and six months ended March 31,

2023, rent expense associated with the facility leases amounted to $ 43,053 and $ 85,527 , respectively.

During the three and six months

ended March 31, 2022, rent expense associated with the facility leases amounted to $ 43,085 and $ 86,130 , respectively.

Supplemental cash flow information related to

the operating leases was as follows:

For the three months ended

Six Months Ended

Cash paid for amounts included in the measurement of lease liability:

1 unchanged sentence

Right-of-use assets obtained in exchange for lease obligations:

Modification of right-of-use asset and associated lease liability

Operating leases

Supplemental balance sheet information related

5 unchanged sentences

Weighted average discount rate

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

Maturity of the lease liabilities was as follows:

13 unchanged sentences

resolution of these matters and potential commitments will not have a material adverse effect on its results of operations or financial

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

NOTE 5 – Supplemental Balance Sheet Information

Prepaid and other assets

Prepaid and other assets consisted of the following:

September 30,

Deferred offering costs

Inventory consisted of the following:

September 30,

Work-in-process

Finished goods

Intangible assets rollforward is as follows:

1 unchanged sentence

12 - 13 years

Net Intangibles, December 31, 2022

Amortization expense was $ 5,579 for each of the

three month periods ended December 31, 2022 and 2021.

Property and Equipment

Net Intangibles, March 31, 2023

Amortization expense was $ 5,579 and $ 11,158 for

the three and six months ended March 31, 2023, respectively, and $ 5,579 and $ 11,158 for the three and six months ended March 31, 2022,

respectively.

Property and Equipment, Net

Property and equipment held for use by category

are presented in the following table:

March 31, 2023

September 30,

4 unchanged sentences

Depreciation expense was $ 38,331 and $ 68,641 for

the three month periods ended December 31, 2022 and 2021, respectively.

the three months and six months ended March 31, 2023, respectively, and $ 22,952 and $ 42,534 for the three and six months ended March 31,

2022, respectively.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

NOTE 6 – Accrued Expenses

Accrued expenses consisted of the following:

NOTE 6 - Accrued Expenses and Other Liabilities

Accrued expenses consisted of the following at

March 31, 2023 and September 30, 2022:

September 30,

31 unchanged sentences

● $ 2.0 million for satisfaction of each of the milestone events related to the design of sEEG products set forth in the Development Agreement even though the satisfaction was after the deadlines originally identified.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

in connection with the Third Amendment, the Company issued Zimmer a warrant to purchase common stock (the “2022 Zimmer Warrant”).

11 unchanged sentences

equity as the number of shares were fixed and determinable, no cash settlement was required and no other provisions precluded equity treatment.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

The Zimmer Development Agreement will expire on

the tenth anniversary of the date of the first commercial sale of the last Products to achieve a first commercial sale, unless terminated

earlier pursuant to its terms.

Either party may terminate the Zimmer Development Agreement (x) with written notice for the other party’s

material breach following a cure period or (y) if the other party becomes subject to certain insolvency proceedings.

In addition, Zimmer

may terminate the Zimmer Development Agreement for any reason with 90 days’ written notice, and the Company may terminate the Zimmer

Development Agreement if Zimmer acquires or directly or indirectly owns a controlling interest in certain competitors of the Company.

The license rights granted to Zimmer under the Strip/Grid Distribution License and sEEG Distribution License shall be exclusive from the

effective date of the Third Amendment until the end of the term.

The Zimmer Development Agreement will expire on the tenth anniversary

of the date of the first commercial sale of the last Products to achieve a first commercial sale, unless terminated earlier pursuant to

Either party may terminate the Zimmer Development Agreement (x) with written notice for the other party’s material breach

following a cure period or (y) if the other party becomes subject to certain insolvency proceedings.

In addition, Zimmer may terminate

the Zimmer Development Agreement for any reason with 90 days’ written notice, and the Company may terminate the Zimmer Development

Agreement if Zimmer acquires or directly or indirectly owns a controlling interest in certain competitors of the Company.

rights granted to Zimmer under the Strip/Grid Distribution License and sEEG Distribution License shall be exclusive from the effective

date of the Third Amendment until the end of the term.

The Zimmer Development Agreement and Third Amendment

22 unchanged sentences

Accordingly, the Company recognized

revenue in the amount of $ 1,455,188 during the three months ended December 31, 2022 related to the completion of the sEEG exclusivity

maintenance milestone.

During the three months ended December 31, 2021, the Company recognized revenue in the amount of $ 6,374 related

to sEEG Product development.

revenue in the amount of zero and $ 1,455,188 during the three and six months ended March 31, 2023, respectively, related to the completion

of the sEEG exclusivity maintenance milestone.

During the three and six months ended March 31, 2022, the Company recognized revenue in

the amount of zero and $ 6,374 related to sEEG Product development, respectively.

A reconciliation of the closing balance of deferred

revenue related to the Zimmer Development Agreement and Third Amendment is as follows during the three months ended as of December 31,

2022 and 2021:

revenue related to the Zimmer Development Agreement and Third Amendment is as follows during the six months ended as of March 31, 2023

Deferred Revenue

2 unchanged sentences

( 1,455,188 )

Balance as of end of period – December 31

Balance as of end of period – March 31

NeuroOne Medical Technologies

Notes to Condensed Financial Statements

Product Revenue

Product revenue recognized during the three month

periods ended December 31, 2022 and 2021 was $ 114,579 and $ 33,748 , respectively, related to the Company’s Strip/Grid Products, sEEG

Products and Electrode Cable Assembly Products.

Product revenue related to its Strip/Grid Products,

sEEG Products and Electrode Cable Assembly Products.

Product revenue recognized during the three and six months ended March 31, 2023 was

$ 466,176 and $ 580,755 , respectively.

Product revenue recognized during the three and six months ended March 31, 2022 was $ 36,584 and $ 70,332 ,

respectively.

Advertising Expense

2 unchanged sentences

Total advertising expense amounted to $ 53,613 and $ 106,639 for the

three month periods ended December 31, 2022 and 2021, respectively.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

three and six months ended March 31, 2023, respectively.

Total advertising expense amounted to $ 113,197 and $ 174,532 for the three and

six months ended March 31, 2022, respectively.

NOTE 8 – Stock-Based Compensation

During the three month periods ended December

31, 2022 and 2021, stock-based compensation expense was included in general and administrative and research and development costs as

follows in the accompanying condensed statements of operations.

General and administrative

During the three and six months ended March 31,

2023 and 2022, stock-based compensation expense related to stock-based awards was included in selling, general and administrative and

research and development costs as follows in the accompanying condensed statements of operations.

Three Months Ended

Six Months Ended

Selling, general and administrative

Research and development

1 unchanged sentence

Stock Options

During the three month periods ended December

31, 2022 and 2021, under the 2017 Equity Incentive Plan (the “2017 Plan”) and the 2021 Inducement Plan (the “Inducement

Plan”), the Company granted 73,731 and 2,000 stock options, respectively, to its employees and consultants.

Vesting generally occurs

over an immediate to 48 month period based on a time of service condition.

The weighted-average grant date fair value of the grants issued

during the three month periods ended December 31, 2022 and 2021 was $ 0.66 and $ 1.72 per share, respectively.

The total expense for the

three months ended December 31, 2022 and 2021 related to stock options was $ 181,744 and $ 162,361 , respectively.

The total number of stock

options outstanding as of December 31, 2022 and September 30, 2022 was 1,313,646 and 1,239,915 , respectively.

The weighted-average assumptions used in

the Black-Scholes option-pricing model are as follows for the stock options granted during the three month periods ended December 31,

2022 and 2021:

During the three months ended March 31, 2023 and

2022, under the 2017 Equity Incentive Plan (the “2017 Plan”), the Company granted 56,781 and 60,000 stock options, respectively,

to its board of directors, officers and employees.

During the six months ended March 31, 2023 and 2022, the Company granted 130,512 and

62,000 , respectively, to its board of directors, officers, employees and consultants.

Vesting generally occurs over an immediate to 48

month period based on a time of service condition although vesting acceleration is provided under one grant in the event that a certain

milestone is met.

The grant date fair value of the grants issued during the three months ended March 31, 2023 and 2022 was $ 0.88 and $ 1.00

per share, respectively.

The grant date fair value of the grants issued during the six months ended March 31, 2023 and 2022 was $ 0.75

and $ 1.03 per share, respectively.

The total expense for the three months ended March

31, 2023 and 2022 related to stock options was $ 142,003 and $ 145,421 , respectively.

The total expense for the six months ended March 31,

2023 and 2022 related to stock options was $ 323,747 and $ 307,782 , respectively.

The total number of stock options outstanding as of March

31, 2023 and September 30, 2022 was 1,370,427 and 1,239,915 , respectively.

NeuroOne Medical Technologies

Notes to Condensed Financial Statements

The weighted-average assumptions used in the Black-Scholes

option-pricing model are as follows for the stock options granted during the three and six months ended March 31, 2023 and 2022:

Three Months Ended

Six Months Ended

Expected stock price volatility

2 unchanged sentences

Risk free interest rate

During the three month periods ended December

31, 2022 and 2021, 127,446 and 18,843 stock options vested, and zero and 13,334 stock options were forfeited during these periods, respectively.

During the three months ended March 31, 2023 and

2022, 84,778 and 182,217 stock options vested, respectively, and zero and 9,167 stock options were forfeited during these periods, respectively.

During the six months ended March 31, 2023 and 2022, 212,224 and 201,060 stock options vested, respectively, and zero and 22,501 stock

options were forfeited during these periods, respectively.

During the three and six months ended March 31, 2023 and 2022, no options were

Restricted Stock Units

There were no restricted stock units (“RSUs”)

granted during the three months ended December 31, 2022 and 2021.

Additionally, 21,930 and 5,644 RSUs vested during these periods, respectively.

The total expense for the three months ended December 31, 2022 and 2021 related to these RSUs was $ 118,437 and $ 40,711 , respectively.

No RSUs were forfeited during the three month periods ended December 31, 2022 and 2021.

As of December 31, 2022, 1,630,141 shares were

available in the aggregate for future issuance under the 2017 Equity Incentive Plan and Inducement Plan.

Unrecognized stock-based compensation

was $ 1,422,392 as of December 31, 2022.

The unrecognized share-based expense is expected to be recognized over a weighted average period

of 1.8 years.

During the three and six months ended March 31,

2023, the Company granted an aggregate of 61,728 restricted stock units (“RSUs”) to its board of directors under the 2017

The weighted average grant date fair value of the RSUs granted during the three and six months ended March 31, 2023 was $ 1.62 per

The RSUs vest over a one year period in equal monthly installments on the last day of each month, subject to the recipient’s

continued service on such dates.

During the three and six months ended March 31,

2022, the Company granted an aggregate of 355,950 restricted stock units (“RSUs”) to certain officers and employees under

the 2017 Plan.

The weighted average grant date fair value of the RSUs granted during the three and six months ended March 31, 2022 was

$ 2.10 per unit.

The RSUs vest over a three year period with 50 percent vesting on the first anniversary of the grant date and the remaining

RSUs vesting in equal monthly installments on the last day of each month over 24 months, subject to the recipient’s continued service

on such dates.

During the three months ended March 31, 2023 and

2022, 219,880 and 3,444 RSUs vested, respectively, and no RSUs were forfeited during these periods.

During the six months ended March

31, 2023 and 2022, 241,810 and 9,088 RSUs vested, respectively, and no RSUs were forfeited during these periods.

The total expense for

the three months ended March 31, 2023 and 2022 related to these RSUs was $ 95,625 and $ 87,295 , respectively.

The total expense for the

six months ended March 31, 2023 and 2022 related to these RSUs was $ 214,062 and $ 128,006 , respectively.

Inducement Plan

On October 4, 2021, the Company adopted the NeuroOne

Medical Technologies Corporation 2021 Inducement Plan (the “Inducement Plan”), pursuant to which the Company reserved 420,350 shares

of its common stock to be used exclusively for grants of awards to individuals who were not previously employees or directors of the Company,

as an inducement material to the individual’s entry into employment with the Company within the meaning of Rule 5635(c)(4) of the

Nasdaq Listing Rules.

The Inducement Plan was approved by the Company’s Board of Directors without stockholder approval in accordance

with such rule.

2017 Plan Evergreen Provision

Under the 2017 Plan, the shares reserved automatically

increase on January 1st of each year, for a period of not more than ten years from the date the 2017 Plan is approved by the stockholders

of the Company, commencing on January 1, 2019 and ending on (and including) January 1, 2027, to an amount equal to 13 % of the fully-diluted

shares outstanding as of December 31st of the preceding calendar year.

Notwithstanding the foregoing, the Board may act prior to January

1st of a given year to provide that there will be no January 1st increase in the share reserve for such year or that the increase in the

share reserve for such year will be a lesser number of shares of common stock than would otherwise occur pursuant to the preceding sentence.

“Fully Diluted Shares” as of a date means an amount equal to the number of shares of common stock (i) outstanding and (ii)

issuable upon exercise, conversion or settlement of outstanding awards under the 2017 Plan and any other outstanding options, warrants

or other securities of the Company that are (directly or indirectly) convertible or exchangeable into or exercisable for shares of common

stock, in each case as of the close of business of the Company on December 31 of the preceding calendar year.

Effective January 1, 2023,

129,479 shares were added to the 2017 Plan as a result of the evergreen provision.

NeuroOne Medical Technologies

Notes to Condensed Financial Statements

As of March 31, 2023, 1,708,219 shares were available

in the aggregate for future issuance under the 2017 Plan and Inducement Plan.

No shares were available for future issuance under the 2016

Equity Incentive Plan.

Unrecognized stock-based compensation was $ 1,334,727 as of March 31, 2023.

The unrecognized share-based expense

is expected to be recognized over a weighted average period of 1.5 years.

NOTE 9 – Concentrations

3 unchanged sentences

Products and sEEG Products.

NeuroOne Medical Technologies Corporation

Notes to Condensed Financial Statements

NOTE 10 – Income Taxes

The effective tax rate for the three months ended

December 31, 2022 and 2021 was zero percent.

As a result of the analysis of all available evidence as of December 31, 2022 and September

The effective tax rate for the three and six months

ended March 31, 2023 and 2022 was zero percent.

As a result of the analysis of all available evidence as of March 31, 2023 and September

30, 2022, the Company recorded a full valuation allowance on its net deferred tax assets.

Consequently, the Company reported no income

tax benefit during the three months ended December 31, 2022 and 2021.

If the Company’s assumptions change and the Company

believes that it will be able to realize these deferred tax assets, the tax benefits relating to any reversal of the valuation allowance

on deferred tax assets will be recognized as a reduction of future income tax expense.

If the assumptions do not change, each

period the Company could record an additional valuation allowance on any increases in the deferred tax assets.

tax benefit during the three and six months ended March 31, 2023 and 2022.

If the Company’s assumptions change and the

Company believes that it will be able to realize these deferred tax assets, the tax benefits relating to any reversal of the valuation

allowance on deferred tax assets will be recognized as a reduction of future income tax expense.

If the assumptions do not

change, each period the Company could record an additional valuation allowance on any increases in the deferred tax assets.

NOTE 11 – Stockholders’ Equity

5 unchanged sentences

JonesTrading is entitled to a commission at a fixed commission rate equal to up to 3 % of the gross proceeds.

of December 31, 2022, no issuances of securities have occurred in connection with the ATM, and deferred issuance costs in the amount of

$ 103,787 have been incurred in connection with the ATM.

of March 31, 2023, 516,484 shares of common stock were issued for gross proceeds of $ 928,257 under the ATM, and issuance costs in the

amount of $ 183,359 have been incurred in connection with the ATM.

See Note 13 – Subsequent Events.

Public Offering

4 unchanged sentences

purchase up to an additional 562,500 shares of common stock on the same terms.

The base offering closed on October 15, 2021, and the

sale of 422,057 shares of common stock subject to the Underwriter’s overallotment option closed on November 15, 2021.

The base offering closed on October 15, 2021, and the sale

of 422,057 shares of common stock subject to the Underwriter’s overallotment option closed on November 15, 2021.

The gross proceeds to the Company from this offering

1 unchanged sentence

the amount of approximately $ 1.4 million in the aggregate.

NeuroOne Medical Technologies

Notes to Condensed Financial Statements

Warrant Activity and Summary

There was no warrant activity during the three

months ended December 31, 2022.

There were no warrant exercises during the three

and six months ended March 31, 2023 and 270,478 warrants expired during the six months ended March 31, 2023.

The following table summarizes information about

warrants outstanding at December 31, 2022:

warrants outstanding at March 31, 2023:

Exercise Price

1 unchanged sentence

Weighted Average

Remaining Contractual

Number Exercisable at

NeuroOne Medical Technologies

Notes to Condensed Financial Statements

NOTE 12 – Deferred Contribution Plan

The Company has a 401(k) defined contribution

plan (the “401K Plan”) for all employees age 21 and over.

Employees can defer up to 100 % of their compensation through payroll

withholdings into the 401K Plan subject to federal law limits.

The Company may match 100 % of deferrals up to 3 % of one’s contributions.

The Company’s matching contributions to employee deferrals are discretionary.

The Company may also make discretionary profit sharing

contributions under the 401K Plan in the future, but it has not done so through March 31, 2023.

Employee contributions and any employer matching

contributions made to satisfy certain non-discrimination tests required by the Internal Revenue Code are 100 % vested upon contribution.

Discretionary employer matches to employee deferrals vest over a six year period beginning on the second anniversary of an employee’s

date of hire.

Discretionary profit sharing contributions vest over a five year period beginning on the first anniversary of an employee’s

date of hire.

The amount of matching contributions to the 401K Plan to satisfy certain non-discrimination tests was zero and $ 30,697 during

the three and six months ending March 31, 2023 and 2022, respectively.

NOTE 13 – Subsequent Events

2017 Plan Evergreen Provision

Under the 2017 Plan, the shares reserved automatically

increase on January 1st of each year, for a period of not more than ten years from the date the 2017 Plan is approved by the stockholders

of the Company, commencing on January 1, 2019 and ending on (and including) January 1, 2027, to an amount equal to 13 % of the fully-diluted

shares outstanding as of December 31st of the preceding calendar year.

Notwithstanding the foregoing, the Board may act prior to January

1st of a given year to provide that there will be no January 1st increase in the share reserve for such year or that the increase in

the share reserve for such year will be a lesser number of shares of common stock than would otherwise occur pursuant to the preceding

“Fully Diluted Shares” as of a date means an amount equal to the number of shares of common stock (i) outstanding

and (ii) issuable upon exercise, conversion or settlement of outstanding awards under the 2017 Plan and any other outstanding options,

warrants or other securities of the Company that are (directly or indirectly) convertible or exchangeable into or exercisable for shares

of common stock, in each case as of the close of business of the Company on December 31 of the preceding calendar year.

Effective January

1, 2023, 129,479 shares were added to the 2017 Plan as a result of the evergreen provision.

NeuroOne Medical Technologies Corporation

In April and May 2023, the Company issued 639,900

shares of common stock for gross proceeds of $ 1.2 million under the ATM prior to the deduction of issuance costs in the amount of $ 0.04

NeuroOne Medical Technologies

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements