Item 9A. Controls and Procedures
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation
of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act), as of the end of the period covered
by this Annual Report. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of December
31, 2024, our disclosure controls and procedures were ineffective because of material weaknesses in our internal controls over financial
reporting which were not designed properly to ensure proper identification of non-routine transactions and ensure appropriate segregation
of duties.
Management’s Report on Internal Control Over
Financial Reporting
Our management
is responsible for establishing and maintaining adequate internal controls over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)). Under the supervision and with the participation of our management, including our CEO and CFO, we conducted
an evaluation of the effectiveness of our internal controls over financial reporting based on the framework in Internal Controls - Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation under the framework
in Internal Control - Integrated Framework, our management concluded that our internal controls over financial reporting were not effective
as of December 31, 2024 because of material weaknesses in our internal controls over financial reporting which were not designed properly
to ensure proper identification of non-routine transactions and ensure appropriate segregation of duties.
Specifically, as disclosed elsewhere in this Annual Report, we completed
the Business Combination on November 7, 2023. Prior to the Business Combination Data Knights, our predecessor, was a special purpose
acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, recapitalization
or similar business combination with one or more businesses. As a result, previously existing internal controls are no longer applicable
or comprehensive enough as of the assessment date, because Data Knights’ operations prior to the Business Combination were insignificant
compared to those of the consolidated entity post-Business Combination. As a result, management is aware of material weaknesses in the
Company’s internal control related to user access/segregation of duties, lack of a formalized control environment and oversight
of controls over financial reporting, errors in accounting for non-routine transactions, and lack of record keeping. Due to the limited
transactional volume currently experienced combined with our financial limitations, we do not currently have an expanded accounting department
that would allow us to better segregate duties. Over time, as we continue to grow and add accounting staff, we expect to continue to
enhance our internal control structure, including appropriate segregation of duties. During September 2024, changes were made to accounting
personnel to enhance our financial reporting structure, which we expect to alleviate reporting pressures, including reporting of non-routine
transactions. In addition, the new personnel has focused on creating central filing repositories to manage accounting records and other
company documents.
As a “non-accelerated filer”, we are not required to provide
an attestation report of our registered public accounting firm on the effectiveness of our internal control over financial reporting.
Changes in Internal Control Over Financial Reporting
No change in our internal control
over financial reporting occurred during the quarter ended December 31, 2024 that has materially affected, or is reasonably likely to
materially affect, our internal control over financial reporting.
Item 9B. Other Information
During the three months ended
December 31, 2024, no director or officer of the Company adopted , modified or terminated a “Rule 10b5-1 trading arrangement”
or “non-Rule 10b5-1 trading arrangement” as each term is defined in Item 408 of Regulation S-K.
Item 9C. Disclosure Regarding Foreign Jurisdictions
that Prevent Inspections
Not applicable.
PART III
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Information concerning our executive
officers and members of our Board of Directors (our “Board”) is set forth below.
Name
Age
Title/Position
Director Since
Aaron Green
52
Chief Executive Officer, President and Director
March 2024
Robert Golden
62
Chief Financial Officer, Corporate Secretary and Director
November 2023
Dr. Jeffrey Yu
58
Founder, Chief Medical Officer, Vice President, Chairman of the Board of Directors
November 2023
Dr. Kenneth Alleyne
59
Director
March 2025
Eric Casaburi
50
Director
November 2023
Jair Clarke
43
Director
October 2024
Sherry Coonse McCraw
56
Director
October 2024
Dr. Thomas Kosasa
80
Director
November 2023
Andrew Zeinfeld
64
Director
August 2024
41
Executive Officers
Aaron Green is a healthcare
IT business transformation leader with more than 20 years of leadership experience in healthcare management, sales, strategic planning,
M&A, product development, customer support and services operations. Mr. Green has served as OneMedNet’s Chief Executive Officer
and a Director since March 2024 and President since May 2023. Prior to joining OneMedNet, Mr. Green served in a variety of healthcare
technology roles including most recently at Optum, a United Health Group company (NYSE: UHG), a leading healthcare technology company,
as Vice President Cloud Solutions. At Optum, Mr. Green was responsible for developing and attaining the P&L, Bookings, Revenue and
EBIDTA targets of its Cloud Solution lines. Before Optum, Mr. Green worked nearly six years, from March 2017 to May 2023, with Change
Health Care, most recently as Vice President Cloud Solutions from March 2021 to May 2023. Previously, Mr. Green worked for more than 15
years with McKesson growing to Division Vice President, Sales where he led an organization of 50+ executives, salespersons and staff,
across the US, Canada, and the US government territories. He holds a Bachelor of Science in Biochemistry from the University of Victoria,
British Columbia, a Systems Analyst Diploma from Royal Roads University, British Columbia, and a Business Administration and Management
certificate from the Wharton School. We believe Mr. Green is well-qualified to serve as a member of our Board of Directors due to his
experience as a public company executive and healthcare IT leader.
Robert Golden is an accomplished
Certified Public Accountant (“CPA”) with more than 30 years of experience. Mr. Golden served as OneMedNet’s Chief Financial
Officer on an interim basis from August 2024 until his permanent appointment as Chief Financial Officer in January 2025, as Corporate
Secretary since September 2024 and as a member of the Board since November 2023. Mr. Golden also serves as the Managing Partner of Cohen,
Bender & Golden LLP, where he provides consulting, accounting and tax services to middle market businesses and owners since September
2015. Prior to that, from January 2013 to August 2015, Mr. Golden worked at Fenton & Ross Accountancy Corporation and, from September
2004 to December 2012, at Saffer & Flint Accountancy Corporation. From December 1989 to June 2004, Mr. Golden was at Good Swartz Brown
& Berns LLP (now CohnReznick) (“GSBB”), where he served as a partner from 1994 onwards. There, Mr. Golden performed administrative
duties, including overseeing the company’s merger negotiations in 2000 and performed financial statement audits, reviews and income
tax planning for middle market businesses and owners. While at GSBB and continuing today, Mr. Golden consults with his business clients
to assist their entrepreneurial owners to better understand the financial performance of their businesses and to help them improve operational
efficiencies and profitability by acting as their outside CFO. Bob also assists with structuring and negotiating financing, compensation
planning, investment opportunity review, as well as merger and acquisition activities and works with wealthy families acting in a CFO-type
role for their family office activities. After leaving GSBB in 2004, in addition to continuing to provide consulting services to middle-market
companies, Bob was the owner and CEO of several companies in the construction and engineering field, coffee and baked goods industries
and also syndicated commercial real estate acquisitions.
From September 1984 to December
1989, Mr. Golden was a CPA at Ernst & Young in Los Angeles. Apart from his experience as a CPA, Mr. Golden is currently the Chief
Financial Officer of Promo Shop, Inc. & Subsidiaries, a specialty advertising promotional products multi-office distributor based
in Los Angeles. Mr. Golden establishes the company’s annual budget among other duties and has been in this role since January 2008.
Mr. Golden is also currently the Chief Financial Officer at iKahan Media, Inc., an out of home media company specializing in digital and
traditional billboards and advertisement, where he has served since September 2014. Mr. Golden is a member of the Board of Directors of
Talon International, Inc. (OTCMKTS: TALN), the world’s oldest and largest zipper manufacturer.
In 1984, Mr. Golden received
his Bachelor of Science degree in Business Administration from the University of Southern California. Mr. Golden also holds a Certified
Public Accountant certification from the California Board of Accountancy, is an Investment Advisor Representative with the SEC and is
a Licensed Engineering Contractor with the California Contractors State License Board. We believe Mr. Golden is well-qualified to serve
as a member of our Board of Directors due to his extensive experience as a Certified Public Accountant at numerous firms as well as his
experience as an executive officer at multiple companies.
42
Dr. Jeffrey Yu serves
as the Chief Medical Officer, Vice President and Chairman of the Board of Directors of OneMedNet, roles he has held since 2023. The concept
of what would become Legacy OneMedNet was founded in 2015 by Dr. Yu, who applies his 28 years of sophisticated healthcare IT experience
to the Company every day. Dr. Yu is a board-certified Radiologist and is also fellowship-trained and board-certified in Nuclear Medicine.
In 2006, he was part of a small group that recognized there was a need to develop electronic sharing technology to help imaging specialists
move patient imaging studies quickly, securely, and cost-effectively. Dr. Yu’s early research and development led to the BEAM solution
which helped improve care and outcomes for stroke and trauma patients. In 2015, he started the concept of what would become Legacy ONMD
to commercialize the BEAM product. Since that time, Dr. Yu has remained an integral part of the strategic decision-making within OneMedNet.
Dr. Yu received his B.S. at U.C. Berkeley and his M.D. at Wake Forest University, conducted MRI research at Stanford University, and completed
his Radiology residency and Nuclear Medicine fellowship at the Mallinckrodt Institute at Washington University. We believe Dr. Yu is well-qualified
to serve as a member of our Board of Directors due to his extensive healthcare IT experience.
Directors
The background information of
Aaron Green, Robert Golden, and Dr. Jeffrey Yu is set forth under “Executive Officers” above. Our Board consists of nine directors
divided into three classes, designated as Class I, Class II, and Class III. In accordance with our Amended and Restated Bylaws (our “Bylaws”)
and Third Amended and Restated Certificate of Incorporation (our “Certificate of Incorporation”), the directors are divided
as evenly as possible into the three classes. The classes of directors serve for staggered three-year terms, with their current terms
ending at the Annual Meeting of Stockholders in the following years: Class I directors – 2027; Class II directors – 2025;
and Class III directors – 2026.
Dr. Kenneth Alleyne is
a board-certified orthopedic surgeon specializing in sports medicine, practicing in both Connecticut and Manhattan. He serves as an attending
surgeon at multiple hospital systems and has held faculty positions both domestically and internationally. Since 2011, Dr. Alleyne has
been the managing partner of HartHaven Partners, a healthcare consulting firm that supports private equity and venture capital firms.
He is also a co-founder of NextLevel Health Partners, a Medicaid-managed care organization in the Midwest, and Zing Healthcare, a technology-driven
Medicare Advantage health plan launched in 2020. Recognizing the challenges of population health and social determinants of health, Dr.
Alleyne became a seed investor and, from January 2010 to June 2012, served as founding chief medical officer of VirtualHealth a leading
population health management platform that oversees more than 10 million lives. He is also the co-founder and CEO of Fizio Health, an
AI-powered computer vision technology for remote physical therapy, where he has served since 2022. Additionally, he serves as a team physician
and consultant for various local, national, and international athletic organizations. Committed to community service, Dr. Alleyne is the
former chair of the Connecticut Health Foundation and sits on the boards of the University of Connecticut Health Center , the Louis Armstrong
Educational Foundation in New York, and Student Achievement Through Opportunity, an organization dedicated to providing academic and arts
enrichment for low-income students. Since 2019, he has also served on the board of Connecticut Public Television and Radio.
Dr. Alleyne is a graduate of
Williams College and completed his medical training at Wake Forest University. He pursued his residency at Howard University Hospital
and later completed a fellowship in sports medicine, knee and shoulder surgery at Yale University, as well as a fellowship in tissue engineering
at the Harvard-MIT Division of Health Sciences and Technology. We believe Dr. Alleyne is well-qualified to serve as a member of our Board
of Directors due to his extensive healthcare experiences and senior leadership positions, including with emerging companies.
Eric Casaburi is an experienced
entrepreneur and chief executive officer with a successfully demonstrated history of explosive growth in the franchising, health and wellness,
food services, and real estate industries including founding and leading RetroFitness from a start-up single-gym business to a $150 million
per year in sales operation while expanding its national footprint. Mr. Casaburi has founded and held positions as chief executive officer
for multiple franchise brands, each having successful exits with impressive returns for investors and private equity partners. Since 2021,
Mr. Casaburi has served as founder and Chief Executive Officer of Serotonin Enterprises LLC, a cutting-edge Anti-Aging Health Optimization
Franchise that offers a vast service menu covering all aspects of optimal health, appearance and performance. Serotonin Centers have been
featured in the Franchise Times as the first franchise of its kind in the United States. Since 2019, Mr. Casaburi has served as the Chair
of TIGER 21 Orlando, a group of men and women who have achieved both success and significance in their lives that helps members build
the skill set to successfully transition from focused entrepreneurs to disciplined managers of wealth.
43
Since 2020, Mr. Casaburi has
founded and operated Longevity Brands and since 2016, Mr. Casaburi founded and owns CEVD Holdings, a commercial real estate investment
and management company. Mr. Casaburi developed all sales, operations, and marketing systems for both the RetroFitness fitness centers
and the franchise and designed and implemented a diversified reoccurring revenue model to improve business health and value. Mr. Casaburi
also founded and served as the Chief Executive Officer of Lets YO! Yogurt from 2012-2015, a self-serve yogurt and treats restaurant popularized
through social media savvy, in which he franchised the business model and opened 24 restaurants in the first year and led to a successful
exit to an industry private equity firm. We believe Mr. Casaburi is well-qualified to serve as a member of our Board of Directors due
to his experience successfully founding and growing companies.
Jair Clarke is the Chairman’s
Executive Advisor and board advisor of World Wide Technology ($20B company) and the CEO/Chief AI Officer of Laigic, an A.I. and tech advisory
firm of C-level Fortune 15 consultants and physicians, where he has served since November 2023. From August 2020 until July 2023, Mr.
Clarke served as the Global Chief Technology Officer of Commercial Systems at Microsoft Corporation, where he was responsible for commercial
systems, artificial intelligence, and products across all industries for Customers and Partner Solutions. Within this organization, Mr.
Clarke was responsible for all technology and processes at scale to empower customers, partners, sellers.
From 2014 through 2020, Mr. Clarke
was responsible for Disney’s big data, digital analytics, and strategy technologies supporting the Chief Commercial Officer to influence
traditional/non-traditional monetization, products, and experiences such as mobile apps, wearable devices, and e-commerce. Mr. Clarke
was a leader for IBM’s Watson, held a U.S. Top Secret SCI Full Scope Polygraph security clearance, oversaw all technical capabilities
for the United States counter-narcotics command partnering with various government agencies (e.g. CIA, FBI), increased business revenue
by 800% within 2 years, and consistently doubled annual revenue. He’s had global P&L responsibility and held roles as the executive
champion of diversity and inclusion. From 2007 to 2014, Mr. Clarke was an IT & Business Development Executive at IBM. From 2005 to
2007, Mr. Clarke consistently expanded his technology responsibilities at Lockheed Martin. Jair has served as a member of the board of
directors of the publicly traded company Xponential Fitness (NYSE: XPOF) since July 2022. Mr. Clarke holds a B.B.A. degree in computer
information systems from the University of Miami. We believe Mr. Clarke is well-qualified to serve as a member of our Board of Directors
due to his experience in technology, business and operations roles concentrated in product management, digital transformation, digital
marketing, cybersecurity, data science, emerging technology, business architecture, customer experiences and worldwide innovation.
Sherry Coonse McCraw has
30 years of leadership experience in engineering, finance, project management, and manufacturing at BMW Manufacturing Co., LLC (“BMW”).
Ms. McCraw has served as a Senior Manager responsible as Chief Financial Officer, Vice President of Assembly Manufacturing, and currently
holds the role of Vice President of Human Resources.
Ms. McCraw began her career with
BMW in 1993 with responsibilities for the facility’s Testing and Finish operation. Over the next eight years, she played a key role
in various aspects of assembly production, planning, engineering, and technology steering. In 2001, Ms. McCraw served as the project manager
in Munich, Germany to manage the structural planning for the second-generation BMW X5. In 2004, she returned to Spartanburg, South Carolina
as the Planning Manager of Assembly and Technology Steering. In 2007, Ms. McCraw managed the plant’s 1.2 million square foot expansion
of its second assembly hall in preparation to produce the BMW X3. In 2011, she was selected to lead BMW’s largest single investment
of $900 million to expand the plant for the fifth time in BMW’s history. In 2013, Ms. McCraw was named Chief Financial Officer and
Vice President Finance of BMW. From March 2018 to April 2022, she was appointed to lead both production halls in her role as Vice President
of Assembly Manufacturing. Since April 2022, Ms. McCraw has served as the Vice President of Human Resources at BMW. Ms. McCraw currently
serves on the Board of Directors for the North Carolina Textile Foundation. She has a Bachelor of Science in Textile Engineering from
North Carolina State University. We believe Ms. McCraw is well-qualified to serve as a member of our Board of Directors due to her senior
leadership experience in financial roles at a large company.
44
Dr. Thomas Kosasa is a
renowned Ob/Gyn/Fertility specialist at the Pacific In Vitro Fertilization Institute and serves on the Board of Trustees of Pan Pacific
Surgical and as a professor of reproductive endocrinology at the University of Hawaii, John A. Burns School of Medicine. Dr. Kosasa is
a consultant for Maternal and Reproductive Health for the Food and Drug Administration and a past member for the Hawaii State Board of
Medical Examiners and the Food and Drug Administration. Dr. Kosasa is a retired Major in the United States Army and was the Chief of Gyn-Surgical
Service and the Director of the Infertility Division at Martin Army Hospital in Fort Benning, Georgia. Dr. Kosasa graduated from Dartmouth
College and earned his medical degree at the McGill University School of Medicine. He completed his residency in obstetrics and gynecology
and fellowship in reproductive endocrinology at Harvard Medical School in the Boston Hospital for Women and completed a Reproductive Endocrinology
Fellowship at the Peter Bent Brigham Hospital, Harvard Medical School. Dr. Kosasa’s professional societies include American College
of Obstetricians and Gynecologists, American Fertility Society, Board of Trustees, Pan Pacific Surgical Association, Hawaii Medical Association
and Pacific Coast Obstetrical and Gynecological Society. We believe Dr. Kosasa is well-qualified to serve as a member of our Board of
Directors due to his extensive experience in the medical field.
Andrew Zeinfeld has over
30 years of public and private sector senior management experience across a variety of industries, including retail, online, telecom,
distribution and real estate. In addition to managing these various businesses, Mr. Zeinfeld also developed strategies to drive profitable
growth both organically and through mergers and acquisitions.
Since June 2019, Mr. Zeinfeld
has been the managing partner of several LLCs that manage his real estate developments and investment portfolio. From November 2019 through
March 2023, Mr. Zeinfeld served as the Chief Executive Officer of Sunstrike International Ltd., a leading distributor of second life refurbished
mobile devices and trade-in solutions within the circular economy. From 2013 through 2018, Mr. Zeinfeld also worked at Brightstar Corp.
(n/k/a Likewize), an end-to-end mobile device management solutions company, where he served in various roles of increasing responsibility.
We believe Mr. Zeinfeld is well-qualified to serve as a member of our Board of Directors due to his senior management experience in both
the public and private sector.
Delinquent Section 16(a) Reports
Section 16(a) of the Exchange
Act requires our executive officers, directors, and people who own more than 10% of a registered class of our equity securities to file
an initial report of ownership (on a Form 3) and reports on subsequent changes in ownership (on Forms 4 or 5) with the SEC by specified
due dates. Our executive officers, directors, and greater-than-10% stockholders are also required by SEC rules to furnish us with copies
of all Section 16(a) forms they file. As a matter of practice, our staff is assisting our executive officers and directors in preparing
initial ownership reports and reporting ownership changes, and will file those reports on their behalf. We are required to disclose in
this proxy statement any failure to file any of these reports on a timely basis. Based solely on our review of the copies of the forms
filed electronically with the SEC, and on written representations from certain reporting persons, we believe that all of these requirements
were satisfied during the year ended December 31, 2024, except for the following:
●
Initial Statements of Beneficial Ownership of Securities on Form 3 for each of Andrew Zeinfeld (appointed effective August 14, 2024), Jair Clarke (appointed on October 1, 2024), and Sherry Coonse McCraw (appointed on October 1, 2024), in each case, upon their respective appointment to the Board;
●
Statements of Changes of Beneficial Ownership of Securities on Form 4:
o
For each of Andrew Zeinfeld, Jair Clarke, and Sherry Coonse McCraw, in each case, for initial equity award grants upon their respective appointment to the Board; and
o
For each of Dr. Jeffrey Yu (230,769 restricted stock units on October 1, 2024) and Robert Golden (100,000 restricted stock units on August 30, 2024), in each case, in connection with the grant of equity awards.
45
Code of Ethics and Business Conduct Policy
We have a written code of ethics
and business conduct policy (“code of ethics”) in place that applies to all the Company’s directors, officers and employees,
including the Company’s principal executive officer, principal financial officer, principal accounting officer or controller, or
persons performing similar functions. A copy of our code of ethics is available on our website at https://www.onemednet.com/investor-relations/.
We intend to use the Investor Relations section of our website as a method of disclosing any change to, or waiver from, our code of ethics
as permitted by applicable SEC and Nasdaq rules. The content on our website is not incorporated by reference in the Amended Form 10-K
unless expressly noted.
Audit Committee
The Board has a
separately-designated standing Audit Committee. The Audit Committee operates under a written charter adopted by the Board. A copy of
the Audit Committee Charter is available under Corporate Governance on the Investor Relations page of the Company’s website at
https://www.onemednet.com/investor-relations/.
The members of the Audit Committee
are Sherry Coonse McCraw, Dr. Alleyne, Jair Clarke, and Dr. Thomas Kosasa. Dr. Alleyne serves as the Chair of the Audit Committee. Our
Board has determined that each of the directors serving on our Audit Committee is independent within the meaning of the rules of the Nasdaq
Stock Market LLC (the “Nasdaq rules”) and Rule 10A-3 under the Exchange Act and meet the requirements for financial literacy
under the Nasdaq rules. In addition, our Board has determined that Dr. Alleyne qualifies as an “audit committee financial expert”
within the meaning of SEC regulations and applicable Nasdaq rules.
Insider Trading Arrangements and Policies
The Company has adopted insider
trading policies and procedures governing the purchase, sale, and other dispositions of its securities by directors, officers and certain
other employees that are reasonably designed to promote compliance with insider trading laws, rules and regulations, and the listing standards
of The Nasdaq Stock Market.
46
ITEM 11.EXECUTIVE COMPENSATION
2024 Summary Compensation Table
The following table sets forth
the total compensation earned for services rendered during the years indicated by our named executive officers as of December 31, 2024.
Name
and principal position
Year
Salary
($)
Bonus
($)
Stock
awards
($) (1)
Option
awards
($) (1)
All
other compensation
($)
Total
($)
Aaron
Green (2)
2024
350,000
—
258,000
—
—
608,000
President
and Chief Executive Officer
2023
213,512
106,435
—
—
—
319,947
Robert Golden (3)
Chief
Financial Officer
2024
—
—
103,000
—
48,000 (3)
151,000
Dr. Jeffrey Yu (4)
Founder, Chief Medical Officer, Vice President, Chairman of the Board of Directors
2024
300,000 (4)
—
19,350
—
—
319,350
Paul Casey (3)
2024
34,892
—
19,350
34,218
12,000
100,460
Former
Chief Executive Officer
2023
144,000
180,250
324,250
Lisa Embree (6)
2024
170,000
—
111,800
—
—
281,800
Former
Chief Financial Officer
2023
225,000
50,000
—
—
—
275,000
(1)
Award amounts reflect the aggregate grant date fair value with respect to awards granted, as determined pursuant to Financial Accounting Standards Board (“FASB”) ASC Topic 718. The assumptions used to calculate the aggregate grant date fair value of option awards are set forth in Note 11 to the consolidated financial statements included in Item 8 of this Annual Report. These amounts do not necessarily reflect actual compensation earned or to be earned by our named executive officers.
(2)
Mr. Green has served as President since May 2023 and as Chief Executive Officer since March 2024.
(3)
Mr. Golden was appointed to serve as Chief Financial Officer on an interim basis on August 30, 2024 and was appointed on a permanent basis on January 1, 2025. Amount in “All Other Compensation” represents cash paid under Mr. Golden’s consulting agreement.
(4)
Dr. Yu was not a named executive officer in 2023. On October 1, 2024, Mr. Yu received a grant of 230,769 restricted stock units (“RSUs”) in lieu of $132,216 of his annual salary, with the RSUs vesting on July 1, 2025, subject to Mr. Yu’s continuous service with the Company.
(5)
Mr. Casey retired in March 2024. Amount in “All Other Compensation” represents severance payment in connection with Mr. Casey’s Resignation Agreement and Release as described in further detail below.
(6)
Ms. Embree served as a consultant from January 2022 through April 15, 2022, and then as Chief Financial Officer until her resignation in August 2024.
47
Narrative
Disclosure to Summary Compensation Table
The
compensation of the Company’s named executive officers is comprised of the following major elements: (a) base salary, (b) bonuses, and (c) long-term
equity incentives, consisting primarily of restricted stock units granted under the Company’s 2022 Equity Incentive Plan. These
principal elements of compensation are described below.
Base
Salary
Base
salary is provided as a fixed source of compensation for our named executive officers. Adjustments to base salaries are reviewed annually
by the Compensation Committee and may be adjusted from time to time to reflect promotions or other changes in the scope of breadth of
the named executive officer’s role or responsibilities, as well as to maintain market competitiveness.
For
2024, the annual base salaries of Mr. Green, Mr. Golden and Dr. Yu were $350,000, $144,000 and $300,000, respectively. See “Executive
Employment Arrangements” below for additional information. On October 1, 2024, Dr. Yu received a grant of 230,769 restricted stock
units (“RSUs”) in lieu of $132,216 of his annual base salary, with the RSUs vesting on July 1, 2025, subject to Dr. Yu’s
continuous service with the Company.
Cash
Bonuses
Annual
cash bonuses may be awarded based on qualitative and quantitative performance standards to reward performance of our named executive
officers. For 2024, no bonuses were approved for our named executive officers.
Long-Term
Equity Incentives
Grants
made under our 2022 Equity Incentive Plan (the “2022 Plan”) provide continual motivation for our officers, employees, consultants
and directors to achieve our business and financial objectives, align their interests with the long-term interests of our stockholders,
and provide a long-term retention incentive.
For
2024, our named executive officers were award RSU awards with vesting terms set forth below, subject to continuous service with the Company
through each applicable vesting date. See “Executive Employment Arrangements” below for additional information.
Executive
Employment Arrangements
The
Company previously entered into employment agreements with Aaron Green, Robert Golden and former executive officers, Paul Casey and Lisa
Embree. The employment agreements provide for at-will employment that may be terminated by the Company with or without cause, by the
executive with or without good reason, or mutually terminated by the parties. The Compensation Committee also approved certain employment
compensation arrangements with Dr. Yu.
Aaron
Green
The
Company entered into an employment agreement with Mr. Green on May 7, 2023, with a start date of May 23, 2025, which provides for a $350,000
annual base salary, eligibility to receive an annual cash performance bonus of up to $175,000 upon achievement of certain performance
goals, and eligibility to receive additional shares under the Company’s equity plan, subject to approval and periodic review by
the Company. In the event that his employment is terminated by the Company without Cause (as defined in the employment agreement), or
is terminated by Mr. Green for Good Reason (as defined in the employment agreement), subject to execution of a standard release, after
the date of his termination of employment (the “Termination Date”) he will be entitled to the following severance payment,
as follows: (a) if the Termination Date is after six (6) months’ of employment, but before he has completed 12 months’ of
employment, he will receive three months’ salary; and (b) if the Termination Date is after 12 months’ employment he will
receive six months’ salary.
On
January 20, 2024, Mr. Green was awarded 600,000 RSUs, with 1/3 of the RSUs vesting on the first anniversary of the vesting start date
and the remaining RSUs vesting in equal monthly installments over the 24 months following first anniversary of the vesting start. The
vesting start date for these RSUs granted to Mr. Green was May 23, 2023.
48
Robert
Golden
The
Company entered into a consulting agreement, effective August 30, 2024, with Mr. Golden in connection with his service as interim chief
financial officer (“CFO”), prior to his permanent appointment in January 2025. The consulting agreement provided for a monthly
fee of $12,000 and an initial grant of 100,000 RSUs that will fully vest on the first anniversary thereafter, subject to Mr. Golden’s
continuous service with the Company.
On
January 31, 2025, the Company appointed Mr. Golden as CFO of the Company on a permanent basis, and in connection with his permanent appointment
as CFO, in addition the continued compensation in the employment agreement, the Company agreed that Mr. Golden will also receive a cash
bonus of $25,000 and a grant of RSUs equal to $25,000, which will be fully vested on the grant date.
Dr.
Jeffery Yu
The
Company previously agreed with Dr. Yu of a base salary of $300,000 for his service to the Company. On October 1, 2024, the Compensation
Committee of the Board reaffirmed a $300,000 base salary for Dr. Yu, and granted Dr. Yu 230,769 RSUs in lieu of $132,216 of his annual
base salary for 2024. These RSUs vest on July 1, 2025, subject to Dr. Yu’s continuous service with the Company.
Former
Executive Officers
The
Company entered into and employment agreement, dated March 28, 2022, with Mr. Casey, which provided for a $144,000 annual salary, eligibility
to receive 147,000 shares of stock upon the successful fundraising of an amount equal to or greater than $5,000,000, and further equity
subject to the approval of the Board of Directors. On March 22, 2024, Mr. Casey notified the Company of his intention to retire as Chief
Executive Officer of the Company effective March 29, 2024. Effective October 1, 2024, Mr. Casey resigned from the Board of Directors
and the Compensation Committee of the Board of Directors. In connection with Mr. Casey’s retirement, Mr. Casey and the Company
entered into a Resignation Agreement and Release, dated March 22, 2024, pursuant to which Mr. Casey was paid $12,000 as a severance payment,
and the Board approved a stock option grant providing for the grant of a stock option to purchase 147,000 shares of common stock that
vested immediately on the date of board approval
The
employment agreement for Ms. Embree provided for a $225,000 annual base salary, eligibility to receive an annual cash performance bonus
of twenty-five percent (25%) of her annual salary upon her achievement of certain performance goals, and eligibility to receive additional
shares under the Company’s equity plan, subject to approval by the Board of Directors. In connection with her separation from the
Company, Ms. Embree received one month’s salary, the continuation of all her benefits for one month, and the ability to vest one-third
of her prior equity awards (such portion equal to 86,667 shares) on the one-year anniversary of the grant date.
2024
Outstanding Equity Awards at Fiscal Year-End
The
following table summarizes information regarding equity-based awards held by our named executive officers as of December 31, 2024.
49
Option Awards
Stock Awards
Name
Grant Date
Number
of Securities Underlying Unexercised Options—Exercisable (#)
Number of Securities Underlying Unexercised Options—Unexercisable (#)
Option Exercise Price ($)
Option Expiration Date
Number of shares or units of stock that have not vested (#)
Market value of shares of units of stock that have not vested ($) (1)
Aaron Green
1/19/2024
—
—
—
—
283,333 (2)
385,333
Robert Golden
8/30/2024
—
—
—
—
100,000 (3)
136,000
Dr. Jeffrey Yu
10/1/2024
—
—
—
—
230,769 (4)
313,846
Paul Casey (5)
10/1/2024
147,000
—
1.00
10/1/2029
—
—
Lisa Embree (6)
—
—
—
—
—
—
—
(1)
Based on the
closing price of our common stock of $1.36 on December 31, 2024, the last trading day of our fiscal year 2024, as reported by Nasdaq.
(2)
Represents RSUs that vest
with 1/3 of the RSUs vesting on the first anniversary of the vesting start date and the remaining RSUs vesting in equal monthly installments
over the 24 months following first anniversary of the vesting start date.
(3)
Represents RSUs that vest
in full on August 30, 2025.
(4)
Represents RSUs that vest
in full on July 1, 2025.
(5)
Mr. Casey retired in March
2024 and continued to serve as a member of the Board until October 1, 2024. Mr. Casey was granted 147,000 fully vested
stock options upon his retirement and the 45,000 RSUs granted as compensation for 2024 Board service were accelerated in connection
with his separation from the Board. The stock options were forfeited without exercise 90 days after his termination of service with
the Company.
(6)
Ms. Embree resigned in
August 2024, and the Board accelerated the vesting of 86,667 RSUs, or 1/3 of the 260,000 RSUs that were scheduled to cliff vest on
January 1, 2025. Ms. Embree forfeited the remaining 173,333 unvested RSUs.
Change
in Control and Termination Arrangements
See
“ Narrative Disclosure to Summary Compensation Table-Executive Employment Arrangements ” for termination benefits for
Mr. Green.
Director
Compensation
In
April 2024, the Board adopted a revised director compensation policy (the “Director Compensation Policy”). The Director Compensation
Policy provides for the annual automatic grant of 45,000 RSUs to each director for each full year of service. The Company also reimburses
all of its directors for all reasonable out-of-pocket expenses incurred in connection with attendance at meetings of the Board.
The
following table sets forth information concerning compensation paid or earned for services rendered to us by the members of our Board
of Directors for the fiscal year ended December 31, 2024. Compensation paid to Aaron Green, Robert Golden and Jeffrey Yu is included
in the section entitled, “Executive Compensation” and excluded from the table below:
Name
Fees Earned or Paid in Cash ($)
Stock
Awards
($) (1)
Total
($)
Eric Casaburi
—
19,350
19,350
Jair Clarke
—
6,579
6,579
Sherry Coonse McCraw
—
6,579
6,579
Dr. Thomas Kosasa
—
19,350
19,350
Andrew Zeinfeld
—
22,438
22,438
Scott Holbrook (2)
—
19,350
19,350
Dr. Julianne (Sun Joo) Huh (3)
—
19,350
19,350
Paul Casey (4)
—
19,350
19,350
Erkan Akyuz (4)
—
19,350
19,350
(1)
Award amounts
reflect the aggregate grant date fair value with respect to awards granted, as determined pursuant to FASB ASC Topic 718. The assumptions
used to calculate the aggregate grant date fair value of option awards are set forth in Note 11 to the consolidated financial statements
included in Item 8 of this Annual Report.
(2)
Mr. Holbrook retired from
the Board effective March 29, 2024.
(3)
Dr. Huh resigned from the
Board effective August 12, 2024.
(4)
Mr. Casey and Mr. Akyuz
each resigned from the Board on October 1, 2024.
50
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Securities
Authorized for Issuance Under Equity Compensation Plans
The
table below summarizes information relating to our equity compensation plans at December 31, 2024.
Plan category
Number of securities to be issued upon exercise of outstanding options, warrants and rights
Weighted-average exercise price of outstanding options, warrants and rights
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in the first column)
Equity compensation plans approved by security holders (1)
147,000
$ 1.00
1,352,736
(1)(2)
Equity compensation plans not approved by security holders
—
—
—
Total
147,000
$ 1.00
1,352,736
(1)
At the Special Meeting
held on October 17, 2023, our stockholders considered and approved the OneMedNet Corporation 2022 Equity Incentive Plan and reserved for issuance thereunder an amount of shares of Common Stock equal to 10% of the number of shares of Common
Stock of the Company following the Business Combination. The Business Combination closed on November 7, 2023. All prior equity plans
were cancelled in connection with the closing of the Business Combination.
(2)
The 2022 Plan allows for
the issuance of options, stock appreciation rights, restricted stock, restricted stock units, performance awards and other equity
awards.
Security
Ownership of Certain Beneficial Owners and Management
The
table below sets forth certain information regarding the beneficial ownership of our Common Stock by beneficial owners of more than 5%
of our outstanding Common Stock, each current director, each named executive officer included in the Summary Compensation Table, and
all current directors and executive officers as a group, as of March 26, 2025 (unless otherwise noted below). Percentage ownership is
based on 30,760,576 shares of Common Stock outstanding as of March 26, 2025.
We
have determined beneficial ownership in accordance with the rules of the SEC. Under these rules, beneficial ownership includes any shares
as to which the individual or entity has sole or shared voting power or investment power. In computing the number of shares beneficially
owned by an individual or entity and the percentage ownership of that person, shares subject to options, or other rights, held by such
person that are currently exercisable or convertible, or will become exercisable or convertible or will vest within 60 days of March
26, 2025, are considered outstanding, although these shares are not considered outstanding for purposes of computing the percentage ownership
of any other person.
Unless
otherwise indicated, the address of all listed stockholders is c/o OneMedNet Corporation, 6385 Old Shady Oak Road, Suite 250, Eden Prairie,
Minnesota 55344. Except as indicated by the footnotes below, we believe that the persons and entities named in the table below have sole
voting and investment power with respect to all securities that they beneficially own, subject to applicable community property laws.
51
Name
Number
of Shares of Common Stock Beneficially Owned
(#)
Percent
of Class
(%)
5% Owners
Data Knights LLC
3,415,275
11.1
%
Off the Chain, LP (1)
3,215,650
10.5
%
Cowen and Company, LLC (2)
2,970,836
9.7
%
TD Securities (USA) LLC (3)
2,970,100
9.7
%
Discovery Capital Management,
LLC (4)
2,301,791
7.5
%
Directors and Named
Executive Officers
Aaron
Green (5)
900,421
2.9
%
Robert Golden
45,000
*
Dr.
Jeffrey Yu (6)
1,934,213
6.2
%
Dr.
Kenneth Alleyne
—
—
Eric
Casaburi
45,000
*
Jair
Clarke
11,342
*
Sherry
Coonse McCraw
11,342
*
Dr.
Thomas Kosasa (7)
11,905,594
35.6
%
Andrew
Zeinfeld
17,260
*
All Current Directors
and Executive Officers as a Group (9 people)
14,870,172
43.1
%
Former Executive Officers
Paul
Casey (8)
100,000
*
Lisa
Embree (9)
—
—
*
Represents beneficial ownership
of less than 1%.
(1)
Based solely on a Schedule
13G filed by Off the Chain LP (“OTC”) with the SEC on October 1, 2024, reporting on beneficial ownership as of September
25, 2024. OTC’s address is listed on the Schedule 13G as 10337 Los Feliz Dr., Orlando, Florida 32836.
(2)
Based solely on a Schedule
13G filed by Cowen and Company, LLC (“Cowen”) with the SEC on November 12, 2024, reporting on beneficial ownership as
of September 30, 2024. Cowen’s address is listed on the Schedule 13G as 99 Lexington Ave., New York, NY 10022.
(3)
Based solely on a Schedule
13G filed by TD Securities (USA) LLC (“TD Securities”) with the SEC on February 14, 2025, reporting on beneficial ownership
as of December 31, 2024. TD Securities’ address is listed on the Schedule 13G as 1 Vanderbilt Ave., New York, New York 10017.
(4)
Based solely on a Schedule
13G filed by Discovery Capital Management, LLC (“Discovery”) with the SEC on August 5, 2024, reporting on beneficial
ownership as of July 25, 2024. Discovery’s address is listed on the Schedule 13G as 20 Marshall Street, Suite 310, South Norwalk,
Connecticut 06854.
(5)
Includes 233,296 shares
issuable upon conversion of the Pre-Closing PIPE Notes and 15,956 shares underlying warrants related to the Pre-Closing PIPE and
the Warrant Agreements executed at the closing of the Business Combination. Also includes 433,750 shares underlying vested RSUs or RSUs vesting within 60 days of March 26, 2025.
(6)
Includes
93,318 shares issuable upon conversion of the Pre-Closing PIPE Notes and 31,916 shares underlying warrants related to the
Pre-Closing PIPE and the Warrant Agreements executed at the closing of the Business Combination. Also includes 45,000 shares
underlying vested RSUs. Excludes an aggregate of 1,145,484 shares held by the Jeffrey N.C. Yu Spousal Trust and the Wendy Sanderson
Yu Spousal Trust, for which Mr. Yu is not the trustee of either trust and has no investment control over the share held in
trust.
(7)
Includes (i) 466,592 shares
issuable upon conversion of the Pre-Closing PIPE Notes, (ii) 2,123,312 shares issuable upon conversion of shareholder loans, and
(iii) 31,916 shares underlying warrants related to the Pre-Closing PIPE and the Warrant Agreements executed at the closing of the
Business Combination. Also includes 45,000 shares underlying vested RSUs.
(8)
Mr. Casey retired from
the Company in March 2024.
(9)
Ms. Embree resigned from
the Company in August 2024.
52
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Related
Person Transactions
The
following is a description of certain transactions, arrangements and relationships in which we were a participant since January 1, 2023
and the amount involved exceeded or will exceed $120,000, and in which any of our executive officers, directors or holders of more than
5% of any class of our voting securities, or an affiliate or immediate family member thereof, had or will have a direct or indirect material
interest. Certain equity, compensation, and other arrangements are described under “Executive Compensation” and are not considered
related person transactions for these purposes.
PIPE
Notes and Warrants
As
disclosed in Note 3 and Note 7 to the consolidated financial statements included herein, Data Knights
issued and sold PIPE Notes in connection with the Business Combination, which are convertible into shares of Common Stock. Total proceeds
raised from the PIPE Notes were $1.5 million, of which $1.0 million were with related party investors, including Mr. Green (our Chief
Executive Officer), Dr. Yu (our Chairman of the Board) and Dr. Kosasa (a director). In connection with the issuance of the PIPE
Notes, the Company also issued a total of 95,744 shares of PIPE Warrants, of which 63,829 shares were issued to the same related party
investors. Refer to Note 12 to the consolidated financial statement included herein for additional details on the terms of the PIPE Warrants.
Convertible
Promissory Notes and Warrants
From
2019 to 2023, the Company issued various Convertible Promissory Notes to related party investors. Total gross proceeds raised from Convertible
Promissory Notes with related parties was $12.3 million (out of $14.2 million total). In connection with the issuance of the Convertible
Promissory Notes, the Company also issued 2,976,000 shares of Convertible Promissory Note Warrants to the same related parties (out of
3,726,000 total). Refer to Note 7 and Note 12 for additional details on the terms of the Convertible Promissory Notes and Convertible
Promissory Note Warrants, respectively.
The
Closing of the Business Combination triggered the conversion of all Convertible Promissory Notes into shares of Common Stock, as disclosed
in Note 3 to the consolidated financial statements included herein.
Shareholder
Loans
From
April 2023 to December 2023, the Company entered into shareholder loans with two related party investors, including Dr.
Yu (our Chairman of the Board) and Dr. Kosasa (a director) (the “Shareholder Loans”) for aggregate gross proceeds
of $954 thousand. The Shareholder Loans bear an interest rate of 8.0% and mature one year from issuance. There are no financial or non-financial
covenants associated with the Shareholder Loans. The Shareholder Loans are not convertible into equity.
On
November 7, 2023, in connection with the Business Combination, one of the Shareholder Loans for $0.5 million was converted into a PIPE
Note equal to the amount of principal and interest outstanding at the time of Closing. The Company accounted for the exchange as an extinguishment
whereby the Shareholder Loan was written off and a separate PIPE Note was recorded at fair value, as disclosed in Note 7 to the consolidated
financial statement included herein.
During
2024, through the date of this report, the Company received gross proceeds of $2.0 million in connection with shareholder loans with
related party investors, including Dr. Yu (our Chairman of the Board) and Dr. Kosasa (a director) .
Of the $2.0 million, $1.6 million is convertible into shares of Common Stock at a conversion price of $0.7535 per share. The remaining
$0.4 million is not convertible into equity and bears an interest rate of 8.0% with a maturity date one year from issuance. The Company
subsequently repaid $0.2 million of the non-convertible shareholder loans to Dr. Yu through the date of this report.
53
Loan
Extensions
As
disclosed in Note 3 to the consolidated financial statements included herein, in connection with the Business Combination, the Company
assumed Data Knights’ liabilities, which included existing loan extensions to related parties. The loan extensions were to be exchanged
for a fixed amount of the Company’s Common Stock upon the closing of a business combination or a similar event. As of December
31, 2024, a balance of $3.0 million remains outstanding and is recorded as loan extensions on the Company’s consolidated balance
sheet.
Policies
and Procedures for Approving Transactions with Related Persons
Our
Audit Committee reviews and oversees all related person transactions in accordance with our Related Party Transactions Policy, either
in advance or when we become aware of a related person transaction that was not reviewed and approved in advance. Other than as described
above, there were no related person transactions in the years ended December 31, 2023 or 2024. The transactions described above were
approved by the Board at the time they were entered into.
Director
Independence
The
rules of Nasdaq require that a majority of the Board be independent. An “independent director” is generally defined under
applicable Nasdaq rules as a person other than an officer or employee of the Company or its subsidiaries or any other individual having
a relationship which, in the opinion of the Board, would interfere with the director’s exercise of independent judgment in carrying
out the responsibilities of a director.
Our
Board is comprised of a majority of independent directors. Our Board has determined that each of Dr. Kenenth Alleyne, Eric Casaburi,
Jair Clarke, Sherry Coonse McCraw, Dr. Thomas Kosasa, and Andrew Zeinfeld is an independent director under the rules of the SEC and Nasdaq
and do not have any material relationship with us other than their positions as directors and stockholders. In making these determinations,
our Board considered past employment, remuneration, and all other relationships each of these directors have with the Company, as well
as the specific independence tests set forth in Nasdaq’s director independence rules. As our President and Chief Executive Officer,
our Chief Financial Officer and Corporate Secretary, and our Chief Medical Officer and Vice President, respectively, none of Mr. Green,
Mr. Golden, or Dr. Yu is considered an independent director under SEC and Nasdaq rules.
The
Board also has determined that Dr. Alleyne, Mr. Casaburi, Mr. Clarke, Ms. Coonse McCraw, Mr. Kosasa and Mr. Zeinfeld are “independent
directors” under Nasdaq listing standards and SEC rules applicable to Audit Committee members and Compensation Committee members,
as applicable.
54
Item 14.
Principal Accounting Fees and
Services
The
Audit Committee is directly responsible for the appointment, compensation, retention (including termination), scope and oversight of
our independent auditors. WithumSmith+Brown, PC (“Withum”), a registered public accounting firm, has served as our independent
auditors since June 2024.
Prior
Audit Firm
On
May 3, 2024, the SEC permanently suspended BF Borgers CPA PC (“BF Borgers”) from appearing or practicing before the SEC as
a registered public accounting firm. Following this order, on May 6, 2024, the Board approved the dismissal of BF Borgers as the Company’s
independent registered public accounting firm. On June 3, 2024, the Company appointed Withum as the Company’s independent registered
public accounting firm.
The
report of BF Borgers on the Company’s financial statements for the fiscal year ended December 31, 2023 did not contain an adverse
opinion or a disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principles other than
an explanatory paragraph relating to the Company’s ability to continue as a going concern.
During
the fiscal year ended December 31, 2023, and through the date of dismissal on May 6, 2024, there were no “disagreements”
with BF Borgers on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which
disagreements if not resolved to the satisfaction of BF Borgers would have caused BF Borgers to make reference thereto in its reports
on the financial statements for such years. During the fiscal year ended December 31, 2023, and through May 6, 2024, there were no “reportable
events” (as defined in Item 304(a)(1)(iv) and Item 304(a)(1)(v) of Regulation S-K), except for the identified material weaknesses
in the Company’s internal control over financial reporting as disclosed in the Annual Report on Form 10-K for the year ended December
31, 2023.
Fees
Paid to Independent Registered Public Accounting Firm
Fees
billed by BF Borgers and Withum for services provided during the years ended December 31, 2024 and 2023 were as follows:
BF
Borgers
Year Ended
December 31, 2023
December 31, 2024
Audit Fees
$ 203,500
—
Audit-Related Fees
—
—
Tax Fees
15,000
—
All Other Fees
—
—
Total
$ 218,500
—
Withum
Year Ended
December 31, 2023
December 31, 2024
Audit Fees
—
$ 790,000
Audit-Related Fees
—
—
Tax Fees
—
50,000
All Other Fees
—
—
Total
—
$ 840,000
Audit
fees include fees associated with (i) the annual audit of our consolidated financial statements and internal control over financial reporting,
(ii) the review of our periodic reports, (iii) accounting consultations, (iv) services related to, or required by, statute or regulation,
such as consents, and (v) other audit services related to SEC and other regulatory filings. Tax fees represent fees for tax consulting
services. Fees paid to Withum in 2024 includes (i) audit fees of $375,000 for the re-audit of the consolidated annual financial statements
for the year ended December 31, 2023 and review of the amended annual report related thereto and other periodic reports, and (ii) tax
fees of $25,000 related to 2023 tax periods.
All
of the services and fees of BF Borgers and Withum reflected in the above table were pre-approved by the Audit Committee pursuant to the
pre-approval policy and procedures set forth below.
55
Audit
Committee Pre-Approval Policies and Procedures
Under
its charter, the Audit Committee is responsible for approving the fees and any other significant compensation paid to our independent
accountants and pre-approving any non-audit services to be performed by our independent accountants. The pre-approval requirement may
be waived only if the non-audit services meet a de minimis exception allowed by law. In carrying out this responsibility, the
Audit Committee follows the following general procedures for the preapproval of non-audit services:
●
Each year the Audit Committee reviews
and pre-approves a schedule of the proposed non-audit services and estimated fees to be provided by the independent accountants during
the next annual audit cycle.
●
Actual amounts paid to the independent accountants
are monitored by management and reported to the Audit Committee.
●
Any non-audit services proposed to be provided by the
independent accountants and the related fees that have not been pre-approved during the annual review by the Audit Committee must
be pre-approved by the Audit Committee in advance of any work performed (unless the services meet the de minimis exception allowed
by law).Incremental fees for previously approved non-audit services that are expected to exceed the previously approved fee estimate
must also be pre-approved by the Audit Committee.
PART
IV
Item 15.
Exhibits, Financial Statement Schedules
The
following documents are filed as a part of this Annual Report:
(a)(1)
Financial Statements
Index to Financial Statements
Page
Consolidated Balance Sheets
F-2
Consolidated Statements of Operations
F-3
Consolidated Statements of Changes in Temporary Equity and Shareholders’ (Deficit) Equity
F-4
Consolidated Statements of Cash Flows
F-5
Notes to the Consolidated Financial Statements
F-6
(a)(2)
Financial Statement Schedules
None.
(a)(3)
Exhibits.
These
exhibits listed below are filed or incorporated by reference into this Report.
Exhibit
Number
Description
2.1†
Agreement and Plan of Merger, dated April 25, 2022, by and among Data Knights, Merger Sub, Sponsor, OneMedNet, and Paul Casey (incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K, filed with the SEC on April 25, 2022).
3.1
Third Amended and Restated Certificate of Incorporation of OneMedNet Corporation (incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K, filed with the SEC on November 13, 2023).
3.2
Amended and Restated Bylaws of OneMedNet Corporation (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 13, 2023).
4.1
Description of the Registrant’s Securities (incorporated by reference to Exhibit 4.1 to the Registrant’s Annual Report on Form 10-K filed with the SEC on April 9, 2024).
4.2
Specimen Warrant Certificate (incorporated by reference to Exhibit 4.3 to the Company’s Form S-1/A, filed with the SEC on April 7, 2021).
4.3
Warrant Agreement, dated May 6, 2021, by and between Continental Stock Transfer & Trust Company and the Company (incorporated by reference to Exhibit 4.3 to the Company’s Form S-1/A, filed with the SEC on April 7, 2021).
4.4
Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 29, 2024).
4.5
Form of Warrant (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on October 1, 2024).
4.6
Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on October 1, 2024).
10.1
Securities Purchase Agreement dated June 28, 2023 with OneMedNet Corporation (incorporated by reference to Exhibit 10.11 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 13, 2023).
10.2
Letter Agreement, dated May 6, 2021, by and between Data Knights, the initial security holders and the officers and directors of the Data Knights (incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K, filed with the SEC on May 11, 2021).
10.4
Form of Registration Rights Agreement by certain OneMedNet equity holders (incorporated by reference to Exhibit G to Annex B to the proxy statement/prospectus which is part of the Registration Statement on Form S-4 declared effective by the SEC on September 22, 2023).
10.5
Lockup Agreement by certain OneMedNet equity holders (incorporated by reference to Exhibit C to Annex B to the proxy statement/prospectus which is part of the Registration Statement on Form S-4 declared effective by the SEC on September 22, 2023).
10.6+
Employment Agreement between OneMedNet Corporation and Aaron Green, President (incorporated by reference to Exhibit 10.8 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 13, 2023).
10.7+
Employment Agreement between OneMedNet Corporation and Lisa Embree, Chief Financial Officer (incorporated by reference to Exhibit 10.09 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 13, 2023).
10.8+
Employment Agreement between OneMedNet Corporation and Paul Casey, Chief Executive Officer (incorporated by reference to Exhibit 10.10 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 13, 2023).
10.9
Securities Purchase Agreement entered into as of March 28, 2024, by and between OneMedNet Corporation and each investor identified on the signature pages thereto (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 2, 2024).
10.10
Registration Rights Agreement dated as of March 28, 2024, by and among OneMedNet Corporation and each of the investors to the Securities Purchase Agreement (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 2, 2024).
10.11
Subscription Escrow Agreement effective March 28, 2024, by and among OneMedNet Corporation, each investor identified on the signature pages thereto, and Rimon, P.C., as the Escrow Agent (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 2, 2024).
56
10.12
Amendment to the Securities Purchase Agreement, effective as of June 4, 2024, between OneMedNet Corporation and each investor identified on the signature pages thereto (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 6, 2024).
10.13
Termination Agreement, dated as of June 14, 2024, between OneMedNet Corporation and Helena Global Investment Opportunities 1 Ltd. (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 21, 2024).
10.14
Standby Equity Purchase Agreement, dated as of June 17, 2024, by and between OneMedNet Corporation and YA II PN, LTD. (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 21, 2024).
10.15
Promissory Note, dated as of June 18, 2024, issued by OneMedNet Corporation to YA II PN, LTD. (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 21, 2024).
10.16
Registration Rights Agreement, dated as of June 17, 2024, by and between OneMedNet Corporation and YA II PN, LTD. (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 21, 2024).
10.17
Termination Agreement, dated as of June 14, 2024, between OneMedNet Corporation and Helena Global Investment Opportunities 1 Ltd. (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 21, 2024).
10.18
Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 29, 2024).
10.19
Form of Registration Rights Agreement (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 29, 2024).
10.20
Form of Voting Agreement (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 29, 2024).
10.21+
Consulting Agreement, dated August 30, 2024, between OneMedNet Corporation and Robert Golden (incorporated by reference to Exhibit 10.1 the Registrant’s Current Report on Form 8-K filed with the SEC on August 30, 2024).
10.22
Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on October 1, 2024).
10.23
Form of Amendment to Registration Rights Agreement (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on October 1, 2024).
10.24
Form of Amendment to Voting Agreement (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed with the SEC on October 1, 2024).
10.25+
OneMedNet Corporation 2022 Equity Incentive Plan (incorporated by reference to Exhibit 99.1 to the Registrant’s Registration Statement on Form S-8 filed with the SEC on February 10, 2025).
10.26+#
Form of Notice of Grant of Restricted Stock Units & Restricted Stock Unit Award Agreement.
19#
Insider Trading Policy
21
Subsidiaries of the Registrant (incorporated by reference to Exhibit 21 to the Registrant’s Annual Report on Form 10-K filed with the SEC on April 9, 2024).
23.1#
Consent of Withum Smith+Brown, PC.
31.1#
Certification of Chief Executive Officer (Principal Executive Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2#
Certification of Chief Financial Officer (Principal Financial Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*
Certification of Chief Executive Officer (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 Chief Financial Officer (Principal Financial Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
97.1
OneMedNet Corporation Compensation Recovery Policy (incorporated by reference to Exhibit 10.8 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on December 17, 2024).
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 (formatted as inline XBRL and contained in Exhibit 101)
†
Schedules and exhibits to this Exhibit omitted pursuant to Regulation S-K Item 601(b)(2). The Registrant agrees to furnish supplementally
a copy of any omitted schedule of exhibit to the SEC upon request.
+
Management or compensatory agreement or arrangement.
#
Filed herewith.
*
Furnished herewith.
Item 16.
Form 10-K Summary
None.
57
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
April 15, 2025
OneMedNet Corporation
By:
/s/ Aaron
Green
Name:
Aaron Green
Title:
Chief Executive Officer
(Principal Executive
Officer)
Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Signature
Title
Date
/s/
Aaron Green
Aaron
Green
Chief Executive Officer, President and Director (Principal
Executive Officer)
April 15, 2025
/s/
Robert Golden
Chief Financial Officer and Director
April 15, 2025
Robert Golden
(Principal Financial Officer and Principal Accounting
Officer)
/s/
Dr. Jeffrey Yu
Dr.
Jeffrey Yu
Chairman of the Board of Directors, Chief Medical Officer,
Vice President
April 15, 2025
/s/
Eric Casaburi
Director
April 15, 2025
Eric Casaburi
/s/
Dr. Kenneth Alleyne
Director
April 15, 2025
Dr. Kenenth Alleyne
/s/
Jair Clarke
Director
April 15, 2025
Jair Clarke
/s/
Sherry Coonse McCraw
Director
April 15, 2025
Sherry Coonse McCraw
/s/
Dr. Thomas Kosasa
Director
April 15, 2025
Dr. Thomas Kosasa
/s/
Andrew Zeinfeld
Director
April 15, 2025
Andrew Zeinfeld
58