What changed in this filing

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Item 1. Financial Statements

2024-05-07 compared with 2023-11-08 · 90 added, 159 removed, 174 unchanged (59% of the section changed)

3 unchanged sentences

(USD in thousands, except per share and share amounts)

September 30,

CURRENT ASSETS

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TOTAL CURRENT ASSETS

Liabilities and Stockholders’ Equity

Liabilities and Shareholders’ Equity

CURRENT LIABILITIES

Accounts payables

Payable offering costs

Accrued liabilities

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COMMITMENTS AND CONTINGENCIES, see Note 3

STOCKHOLDERS’ EQUITY:

Common Stock, $ 0.00001 par value – 60,000,000 shares authorized as of September 30, 2023, and December 31, 2022, 17,309,911 , and 15,190,720 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively

SHAREHOLDERS’ EQUITY see Note 4

Common Shares, $ 0.00001 par value – 60,000,000 shares authorized as of March 31, 2024, and December 31, 2023, respectively, 18,356,060 , and 17,418,886 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively

Additional paid in capital

Accumulated deficit

TOTAL STOCKHOLDERS’ EQUITY

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

TOTAL SHAREHOLDERS’ EQUITY

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

Represents an amount lower than $1,000 USD.

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(USD in thousands, except per share and share amounts)

Three Months Ended September 30

Nine Months Ended September 30

Three Months Ended March 31

OPERATING EXPENSES

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Finance income

NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS

BASIC AND DILUTED NET LOSS PER COMMON STOCK OUTSTANDING, see Note 6

Basic and diluted weighted average number of common stock outstanding

NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS

BASIC AND DILUTED NET LOSS PER COMMON SHARES OUTSTANDING, see Note 6

Basic and diluted weighted average number of common shares outstanding

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

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(USD in thousands, except share amounts)

Redeemable Convertible

Preferred Stock

$0.00001 Par Value

Stockholders’

Equity/(Deficit)

BALANCES AT DECEMBER 31, 2022

Conversion of Series A redeemable convertible preferred shares

( 5,012,280 )

Issuance of common stock upon initial public offering, net of offering costs of $ 2,892

Share based payments

Issuance of restricted share awards

Exercise of preferred investment options

Exercise of warrants

Net loss for the period

BALANCES AT MARCH 31, 2023

Share-based payments

Net loss for the period

BALANCES AT JUNE 30, 2022

Issuance of common stock, unexercised prefunded warrants and warrants in private placement, net of offering costs of $ 1,687

Exercise of prefunded warrants

Share based payments

Net loss for the period

BALANCES AT SEPTEMBER 30, 2022

Represents an amount lower than $1,000 USD.

3 unchanged sentences

(USD in thousands, except share amounts)

Redeemable Convertible

Preferred Stock

$0.00001 Par Value

Stockholders’

1 unchanged sentence

Share based payments

Issuance of restricted stock awards

Exercise of preferred investment options

Exercise of warrants

Issuance of restricted share awards

Issuance of common shares, net of offering costs of $ 153 - At-the-market

Net loss for the period

BALANCES AT MARCH 31, 2024

Share based payments

Issuance of restricted stock awards

Exercise of preferred investment options, net of offering costs of $ 770

Exercise of warrants

Issuance of common stock, net of offering costs of $ 152 - At-the-market

Exercise of stock options

Net loss for the period

BALANCES AT JUNE 30, 2023

Share based payments

Issuance of restricted stock awards

Issuance of common stock, net of offering costs of $ 39 - At-the-market

Net loss for the period

BALANCES AT SEPTEMBER 30, 2023

Represents an amount lower than $1,000 USD.

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(USD in thousands, except per share and share amounts)

Nine Months Ended September 30,

Three Months Ended March 31,

CASH FLOWS FROM OPERATING ACTIVITIES

Adjustments to reconcile loss to net cash used in operating activities:

Cost of stock-based payments

Cost of share-based payments

Changes in operating assets and liabilities:

(Increase)/decrease in other current assets

(Decrease)/increase in accounts payable, accrued compensation and benefits, and accrued liabilities

Increase in other current assets

Decrease in accounts payable

Increase/(Decrease) in accrued liabilities

Decrease in accrued compensation and benefits

Net cash used in operating activities

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Issuance costs related to At-the-market offering

Proceeds from issuance of common stock upon initial public offering

Issuance costs related to initial public offering

Proceeds from issuance of common stock and pre-funded warrants in private placement

Proceeds from exercise of warrants/options/preferred investment option

Issuance costs related to the exercise of warrants/preferred investment option

Proceeds from exercise of warrants, options, and preferred investment option

Issuance costs related to private placement

Net cash provided by financing activities

INCREASE IN CASH AND CASH EQUIVALENTS

INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

CASH AND CASH EQUIVALENTS AT END OF PERIOD

Supplemental noncash disclosure of investing and financing activities:

Unpaid issuance costs related to the private placement

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

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Liquidity and Capital Resources

The Company has incurred net operating losses since its inception and had an accumulated deficit of $ 47.6 million as of September 30, 2023.

The Company had cash and cash equivalents of $ 22.1 million as of September 30, 2023 and has not generated positive cash flows from operations.

To date, the Company has been able to fund its operations primarily through the issuance and sale of common stock and redeemable convertible preferred shares, all of which was converted into common stock at the February 2022 initial public offering.

Management believes that its existing cash, and cash equivalents as of September 30, 2023 enable the Company to fund planned operations for at least 12 months following the issuance date of these condensed financial statements.

The Company has incurred net operating losses since its inception and had an accumulated deficit of $ 58.4 million as of March 31, 2024.

The Company had cash and cash equivalents of $ 19.5 million as of March 31, 2024 and has not generated positive cash flows from operations.

To date, the Company has been able to fund its operations primarily through the issuance and sale of common stock.

During the three months ended March 31, 2024, the Company sold a total of 502,647 common shares under its At-the-Market Program for aggregate total gross proceeds of approximately $ 4.8 million at an average selling price of $ 9.31 per share, resulting in net proceeds of approximately $ 4.7 million after deducting issuance costs.

Management believes that its existing cash and cash equivalents as of March 31, 2024 enable the Company to fund planned operations for at least 12 months following the issuance date of these condensed financial statements.

The Company will need to raise additional capital in order to complete the clinical trials aimed at developing the product candidates until obtaining its regulatory and marketing approvals.

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In the opinion of management, the unaudited condensed financial statements include all normal and recurring adjustments that are considered necessary for the fair statement of results for the interim periods.

The results for the period ended September 30, 2023 are not necessarily indicative of those expected for the year ending December 31, 2023 or for any future period.

The results for the period ended March 31, 2024 are not necessarily indicative of those expected for the year ending December 31, 2024 or for any future period.

The condensed balance sheet as of December 31, 2023 included herein was derived from the audited financial statements as of that date but does not include all disclosures required by U.S.

These unaudited condensed financial statements should be read in conjunction with the Company’s audited financial statements and the related notes thereto for the year ended December 31, 2023, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 5, 2024.

The significant accounting policies adopted and used in the preparation of the financial statements are consistent with those of the previous financial year except as described below.

The significant accounting policies adopted and used in the preparation of the financial statements are consistent with those of the previous financial year.

Use of Estimates in the Preparation of Financial Statements

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The money market accounts included in cash and cash equivalents are considered Level 1.

During the three months and nine months ended September 30, 2023 and 2022, there were no transfers between fair value measure levels.

During the three months ended March 31, 2024 and 2023, there were no transfers between fair value measure levels.

Other financial instruments consist mainly of cash and cash equivalents, other current assets, accounts payable and accrued liabilities.

The fair value of these financial instruments approximates their carrying values.

Stock Compensation

The Company accounts for employees’, directors’ and service providers’ share-based payment awards classified as equity awards using the grant-date fair value method.

The fair value of share-based payment transactions is recognized as an expense over the requisite service period.

The equity awards could come in the form of options, warrants, and restricted stock awards.

The Company elected to recognize compensation costs for awards using the accelerated method based on the multiple-option award approach.

Performance based awards are expensed over the vesting period only if the achievement of performance criteria is probable.

The Company has elected to recognize forfeitures as they occur.

For stock options containing a market condition, the market conditions are required to be considered when calculating the grant date fair value.

ASC 718 requires selection of a valuation technique that best fits the circumstances of an award.

(see Note 5).

In order to reflect the substantive characteristics of the market condition option award, a Monte Carlo simulation valuation model was used to calculate the grant date fair value of such stock options.

Expense for the market condition stock options is recognized over the derived service period as determined through the Monte Carlo simulation model.

Recently Issued Accounting Pronouncements Not Yet Adopted

Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements.

Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial position or results of operations.

No new accounting standards were adopted during the period.

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CRT Pioneer Fund License Agreement

There have been no material changes to the CRT Pioneer Fund License Agreement, as revised on March 31, 2022, (the “License Agreement”) as previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year

There have been no material changes to the CRT Pioneer Fund License Agreement, as previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on March 5, 2024 (see Note 5a in the Notes to the Financial Statements in our Annual Report).

Any potential milestone or royalty payment amounts have not been accrued as of March 31, 2024 and December 31, 2023 due to the uncertainty related to the achievement of these events or milestones.

University of Edinburgh License Agreement

There have been no material changes to the University of Edinburgh (“UoE”) License Agreement as previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on March 5, 2024 (see Note 5a in the Notes to the Financial Statements in our Annual Report).

Any potential future research support, milestone or royalty payment amounts have not been accrued as of March 31, 2024 and December 31, 2023 due to the uncertainty related to the achievement of these events, milestones or commitments to additional research.

As of March 31, 2024, the Company has paid UoE $ 0.8 million of the total $ 3.0 million related to the fund-raising commitment.

NUVECTIS PHARMA, INC.

Notes to the Unaudited Condensed Financial Statements (continued)

ended December 31, 2022 filed with the Securities and Exchange Commission on March 8, 2023 (see Note 5a in the Notes to the Financial Statements) except noted below.

In connection with the License Agreement described in the annual report, the Company agreed to provide Institute of Cancer Research in London, UK ("ICR”) with up to an additional $ 865,000 in research and development support to conduct additional scientific research and preclinical testing for certain indications that the Company selects in connection with the NXP800 Program.

The Company recognized zero and $ 0.4 million in research and development expense during the three months and nine months ended September 30, 2023, respectively.

The Company expects to expense the remaining $ 0.2 million related to this research and development support in the fourth quarter 2023.

Any potential milestone or royalty payment amounts have not been accrued as of September 30, 2023 and December 31, 2022 due to the uncertainty related to the achievement of these events or milestones.

University of Edinburgh License Agreement

There have been no material changes to the University of Edinburgh (“UoE”) License Agreement as previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the Securities and Exchange Commission on March 8, 2023 (see Note 5a in the Notes to the Financial Statements).

Any potential future research support, milestone or royalty payment amounts have not been accrued as of September 30, 2023 and December 31, 2022 due to the uncertainty related to the achievement of these events, milestones or commitments to additional research.

Related Party Transactions

There have been no related party transactions as previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the Securities and Exchange Commission on March 8, 2023 (see Note 10 in the Notes to the Financial Statements).

There have been no related party transactions as previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on March 5, 2024 (see Note 10 in the Notes to the Financial Statements).

Contingencies

As of September 30, 2023, and as of December 31, 2022, there are no contingent liabilities, therefore, no provision was made.

NOTE 4 – STOCKHOLDERS’ EQUITY:

As of March 31, 2024, and December 31, 2023, there are no contingent liabilities, therefore, no provision was made.

NOTE 4 – SHAREHOLDERS’ EQUITY:

Private Placement in Public Entity

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The Preferred Investment Options became exercisable on January 23, 2023 and are exercisable through January 29, 2026, at an exercise price of $ 9.65 per share, subject to certain adjustments as defined in the Agreement.

1,001,091 Preferred Investment Options were exercised for $ 8.9 million, net of fees, as of September 30, 2023.

As of March 31, 2024, 1,001,091 Preferred Investment Options were exercised for $ 8.9 million, net of fees.

In addition, as part of the July 2022 Private Placement, the Company issued warrants to the placement agent to purchase up to 115,481 shares of common stock.

The placement agent warrants are in substantially the same form as the Preferred Investment Options, except that the exercise price is $ 10.31 .

NUVECTIS PHARMA, INC.

Notes to the Unaudited Condensed Financial Statements (continued)

79,104 placement agent warrants were exercised for which the Company has received $ 0.8 million as of September 30, 2023.

As of March 31, 2024, 79,104 placement agent warrants were exercised for which the Company has received $ 0.8 million.

At-the-Market Program

During the three months ended March 31, 2024, the Company sold a total of 502,647 common shares under our At-the-Market Offering Agreement with H.

Wainwright & Co.

(the “ATM Program”) for aggregate total gross proceeds of approximately $ 4.8 million at an average selling price of $ 9.31 per share, resulting in net proceeds of approximately $ 4.7 million after deducting commissions and other transaction costs.

As of March 31, 2024, approximately $ 29.9 million of securities remain available under the ATM Program.

NOTE 5 – SHARE BASED PAYMENTS:

Share Based Payments

In January 2023, the Company granted 43,500 options with an exercise price of $ 7.51 per share, to a service provider, which will become exercisable between January 19, 2023, and January 18, 2025, into common stock based on the achievement of service condition, market condition or performance condition.

As of September 30, 2023, 21,000 options were exercisable.

Service condition options totaled 22,500 , had an estimated value based on Black-Scholes of approximately $ 74,000 and were exercisable as of September 30, 2023.

Performance condition options totaled 12,000 , had an estimated value based on Black-Scholes of approximately $ 39,000 and were exercisable as of September 30, 2023.

Market condition options totaling 9,000 options have a market condition which was achieved by September 30, 2023, and an estimated value of $ 20,000 based on a Monte Carlo model.

2,792 options have been exercised as of September 30, 2023.

The fair value of options was evaluated at the grant date using a Black-Scholes Option Pricing Model for various possible scenarios.

The following table summarizes assumptions used for the Black-Scholes model at the grant date:

Risk-free interest rate

Common stock price

Expected dividend yield

Expected term (in years)

Expected volatility

In February 2022, the Company granted to the underwriter of our initial public offering of common stock (the “IPO”), 128,000 fully vested warrants upon the IPO, exercisable into common stock with an exercise price of $ 6.25 per share for 5 years after the grant date.

The 128,000 fully vested warrants have an estimated value (based on Black-Scholes model) of approximately $ 458,000 and were recognized as a reduction from gross proceeds of the IPO.

IPO warrants totaling 105,920 were exercised for $ 0.7 million as of September 30, 2023.

2021 Global Equity Incentive Plan (“Incentive Plan”)

The following table summarizes the Company’s stock option activity in the Incentive Plan for the nine months ended September 30, 2023:

The following table summarizes the Company’s stock option activity in the Incentive Plan for the three months ended March 31, 2024:

NUVECTIS PHARMA, INC.

Notes to the Unaudited Condensed Financial Statements (continued)

Weighted average

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Balance, December 31, 2023

Outstanding – September 30, 2023

Exercisable – September 30, 2023

Expected to vest – September 30, 2023

As of September 30, 2023, there was $ 0.3 million of unrecognized stock-based compensation expense related to unvested stock options that is expected to be recognized over a weighted-average period of 1.42 years.

NUVECTIS PHARMA, INC.

Notes to the Unaudited Condensed Financial Statements (continued)

Outstanding – March 31, 2024

Exercisable – March 31, 2024

Expected to vest – March 31, 2024

As of March 31, 2024, there was $ 0.1 million of unrecognized share-based compensation expense related to unvested stock options that is expected to be recognized over a weighted-average period of 0.49 years.

Restricted Stock Awards

Restricted stock awards (“RSAs”) have been granted to employees.

The value of an RSA award is based on the Company’s stock price on the date of grant.

The value of an RSA award is based on the Company’s share price on the date of grant.

The Company granted RSAs pursuant to the Incentive Plan.

The following table summarizes the Company’s RSA activity for the nine months ended September 30, 2023, as described above from the Incentive Plan:

The following table summarizes the Company’s RSA activity for the three months ended March 31, 2024, as described above from the Incentive Plan:

Weighted average

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Balance, December 31, 2023

Outstanding – September 30, 2023

Expected to vest – September 30, 2023

There were 60,000,000 shares of common stock authorized as of September 30, 2023.

As of September 30, 2023 and December 31, 2022, 17,309,911 and 15,190,720 shares were issued and outstanding, respectively, which includes 952,169 and 338,807 of unvested RSAs as of September 30, 2023, and December 31, 2022, respectively.

As of September 30, 2023, there was $ 4.09 million of total unrecognized compensation cost related to RSAs expected to be recognized over a weighted average period of 2.13 years.

For the nine months ended September 30, 2023, the Company issued 210,000 RSAs to Mr.

Ron Bentsur and 115,000 RSAs to each of Dr.

Outstanding – March 31, 2024

Expected to vest – March 31, 2024

There were 60,000,000 shares of common share authorized as of March 31, 2024.

As of March 31, 2024, and December 31, 2023, 18,356,060 and 17,418,886 shares were issued and outstanding , respectively, which includes 1,174,940 and 941,496 of unvested RSAs as of March 31, 2024, and December 31, 2023, respectively.

As of March 31, 2024, there was $ 5.4 million of total unrecognized compensation cost related to RSAs expected to be recognized over a weighted average period of 1.32 years.

For the three months ended March 31, 2024, the Company issued 130,000 RSAs to each of Dr.

Enrique Poradosu and Mr.

Shay Shemesh, along with 18,000 RSAs issued to its independent directors.

Shay Shemesh.

These RSAs vest over three years with 1/3 vesting on each anniversary of the date of the grant.

On April 1, 2022, the Company issued 120,000 RSAs to Mr.

On January 12, 2023, the Company issued 210,000 RSAs to Mr.

Ron Bentsur and 115,000 RSAs to each of Dr.

Enrique Poradosu and Mr.

Shay Shemesh.

Shay Shemesh (the “January 2023 Grants”).

These RSAs vest over three years with 1/3 vesting on each anniversary of the date of the grant.

On March 29, 2023, the vesting of the first 1/3 of the grant was extended to January 11, 2024, the second vesting extended to April 2, 2024 and the third vesting extended to April 2, 2025.

On July 27, 2021, Mr.

Ron Bentsur, Dr.

Enrique Poradosu, and Mr.

Shay Shemesh were granted 96,759 RSAs, 48,399 RSAs, and 48,399 RSAs, respectively, which were not part of the Company’s Incentive Plan and excluded from the table above.

On March 29, 2023, the vesting of these grants was extended to January 11, 2024.

Share Compensation Expense

For the three months ended September 30, 2023, the Company recognized expenses of $ 0.5 million as part of general and administrative expenses and $ 0.6 million as part of research and development expenses.

For the three months ended September 30, 2022, the Company recognized expenses of $ 0.2 million as part of general and administrative expenses and $ 0.3 million as part of research and development expenses.

For the nine months ended September 30, 2023, the Company recognized expenses of $ 1.6 million as part of general and administrative expenses and $ 1.9 million as part of research and development expenses.

For the nine months ended September 30, 2022, the Company recognized expenses of $ 0.6 million as part of general and administrative expenses and $ 0.6 million as part of research and development expenses.

On January 4, 2024, the vesting of the first 1/3 of the January 2023 Grants were extended to July 15, 2024.

On April 1, 2022, the Company issued 120,000 RSAs to Mr.

Bentsur and 60,000 RSAs to each of Dr.

Poradosu and Mr.

Shemesh (the “April 2022 Grants”).

These RSAs vest over three years with 1/3 vesting on each anniversary of the date of the grant.

On January 4, 2024, the vesting of the first 2/3 of the April 2022 Grants were extended to July 15, 2024.

NUVECTIS PHARMA, INC.

Notes to the Unaudited Condensed Financial Statements (continued)

On July 27, 2021, Mr.

Poradosu, and Mr.

Shemesh were granted 96,759 RSAs, 48,399 RSAs, and 48,399 RSAs, respectively, which were not part of the Incentive Plan and excluded from the table above.

On January 4, 2024, the vesting of the July 2021 grant to Mr.

Poradosu and Mr.

Shemesh was extended to July 15, 2024.

Share Compensation Expense

For the three months ended March 31, 2024, the Company recognized expenses of $ 0.5 million as part of general and administrative expenses and $ 0.8 million as part of research and development expenses.

For the three months ended March 31, 2023, the Company recognized expenses of $ 0.5 million as part of general and administrative expenses and $ 0.8 million as part of research and development expenses.

NOTE 6 – NET LOSS PER SHARE:

Basic net loss per share is calculated by dividing the net loss attributable to the Company’s stockholders by the weighted average number of common stock outstanding.

Basic net loss per share is calculated by dividing the net loss attributable to the Company’s shareholders by the weighted average number of common share outstanding.

For the three months

For the nine ended

ended September 30, 2023

ended September 30, 2022

ended September 30, 2023

ended September 30, 2022

in thousand U.S.

dollars except per share and share amounts

Loss attributable to common stockholders

ended March 31, 2024

ended March 31, 2023

Loss attributable to common shareholders

Basic and diluted net loss per common share

Weighted average of common share outstanding

Basic loss per share is calculated by dividing the result attributable to equity holders of the Company by the weighted average number of shares of common stock in issue during the year.

For the three months

For the nine ended

ended September 30, 2023

Weighted average of common stock

Basic loss per share is calculated by dividing the result attributable to equity holders of the Company by the weighted average number of shares of common stock in issue during the period.

For the three months ended March 31,

Weighted average of common shares

Unvested RSAs

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The following potentially dilutive securities were excluded from the calculation of diluted net loss per common share because their effect would have been anti-dilutive for the years presented:

September 30,

Common stock issuable in relation to:

Common shares issuable in relation to:

Unvested RSAs *

* includes 193,557 of RSAs granted outside of the Incentive Plan

* includes 193,557 of RSAs granted outside of the Incentive Plan see explanation in note 5

NOTE 7 – RELATED PARTY TRANSACTIONS:

1 unchanged sentence

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