RELMADA THERAPEUTICS, INC. 10-K

ITEM 9A . CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we carried out an evaluation of 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 Exchange Act. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, at December 31, 2023, such disclosure controls and procedures were effective. Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. This Annual Report on Form 10-K does not include an attestation report from our registered public accounting firm regarding internal control over financial reporting. Our internal control over financial reporting was not subject to such attestation as we are a non-accelerated filer. Limitations on the Effectiveness of Controls Our disclosure controls and procedures are designed to provide reasonable, not absolute, assurance that the objectives of our disclosure control system are met. Because of inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected. Our Chief Executive Officer and Chief Financial Officer have concluded, based on their evaluation as of the end of the period covered by this Report that our disclosure controls and procedures were effective to provide reasonable assurance that the objectives of our disclosure control system were met. Changes in Internal Control Over Financial Reporting There were no changes in the Company’s internal controls over financial reporting that occurred during the fourth quarter of the fiscal year covered by this Annual Report on Form 10-K that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. 40 Management’s Report on Internal Control Over Financial Reporting As required by the SEC rules and regulations for the implementation of Section 404 of the Sarbanes-Oxley Act, our management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our consolidated financial statements for external reporting purposes in accordance with United States Generally Accepted Accounting Principles (GAAP). Our internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company, (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors, and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect errors or misstatements in our consolidated financial statements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree or compliance with the policies or procedures may deteriorate. Management assessed the effectiveness of our internal control over financial reporting at December 31, 2023. In making these assessments, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission COSO (2013 framework). Based on our assessments and those criteria, management determined that we did maintain effective internal control over financial reporting at December 31, 2023. ITEM 9B. OTHER INFORMATION On March 14, 2024, our Board of Directors unanimously approved, subject to stockholder approval, an amendment to the Company’s 2021 Equity Incentive Plan (the “2021 Plan”), increasing by 4,500,000 shares the number of shares of our common stock that will be available for issuance of awards under the 2021 Plan. The 2021 Plan as adopted and approved by our shareholders originally authorized awards for up to 1,500,000 shares of our common stock. On May 25, 2022, shareholders approved an amendment to the 2021 Plan to increase the shares of the Company’s common stock available for issuance thereunder by 3,900,000 shares. On May 25, 2023, shareholders approved an amendment to the 2021 Plan to increase the shares of the Company’s common stock available for issuance thereunder by 2,500,000. The purpose of the 2021 Plan is to (a) enable the Company and its affiliates to attract and retain the types of employees, directors and consultants who will contribute to the Company’s long range success; (b) provide incentives that align the interests of employees, consultants and directors with those of the stockholders of the Company; and (c) promote the success of the Company’s business, thus enhancing the value of the Company for the benefit of its stockholders. 41 Administration . The 2021 Plan will be administered by a committee (the “Committee”), or in the Board’s sole discretion by the Board. In case no Committee has been appointed, the Board may appoint one or more members of the Board appointed by the Board to administer the 2021 Plan in accordance with the terms of the 2021 Plan. The Board has appointed the Compensation Committee of the Board to administer the 2021 Plan. Shares Available for Awards . Subject to shareholder approval of the most recent amendment to the 2021 Plan, and to adjustment in certain circumstances in accordance with the terms of the 2021 Plan, we will reserve for issuance under the 2021 Plan no more than 12,400,000 shares of common stock (subject to adjustment in certain circumstances as provided in the 2021 Plan). Shares of Common Stock available for distribution under the 2021 Plan may consist, in whole or in part, of authorized and unissued shares, treasury shares or shares reacquired by the Company in any manner. Shares of Common Stock subject to an award that expires or is canceled, forfeited, or terminated without issuance of the full number of shares of Common Stock to which the award related, as well as any shares of common stock subject to an award that are (a) tendered in payment of an option, (b) delivered or withheld by the company to satisfy any tax withholding obligation, or (c) covered by a stock-settled stock appreciation right or other awards that were not issued upon the settlement of the award, shall be added back to the shares of common stock available for issuance of awards or delivery under the 2021 Plan. Available Awards . Awards that may be granted under the 2021 plan include: (a) incentive stock options, (b) non-qualified stock options, (c) stock appreciation rights, (d) restricted awards, (e) performance share awards, (f) cash awards, and (g) other equity-based awards. Recipients of Grants . Incentive stock options may be granted only to employees. Awards other than incentive stock options may be granted to employees, consultants and directors and those individuals whom the Committee or the Board determines are reasonably expected to become employees, consultants and directors following the grant date. Our principal executive officer, principal financial officer and other named executive officers are eligible to participate in and receive awards under the 2021 Plan. Term . The 2021 Plan has a term of ten years. This summary of the 2021 Plan is qualified in its entirety by the full text of the 2021 Plan, which is filed as Exhibit 10.33 to this Report and is incorporated by reference herein. The proposed amendment to the 2021 Plan will be submitted for the approval of our shareholders at our 2024 Annual Meeting of Stockholders. If the proposed amendment is not approved by the shareholders, the 2021 Plan will remain effective with respect to the number of shares of common stock originally authorized. Options for 4,363,250 shares of commons stock were issued in December 2023 subject to approval by the shareholders of this amendment. If the amendment is not approved, such options will be void, but the recipients thereof will receive identical options for a pro-rata share of any shares available for issuance of awards under the 2021 Plan immediately after the shareholder meeting. Insider Trading Arrangements On November 15, 2023 , Charles Ence , our Chief Accounting and Compliance Officer , adopted a Rule 10b5-1 trading arrangement that was intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act for the sale of up to 137,110 shares of the Company’s common stock , with such transactions to occur during sale periods beginning on or after April 23, 2024 and ending on the earlier of December 20, 2024, or the date on which all shares authorized for sale have been sold in conformance with the terms of the arrangement. On November 22, 2023, Mr. Ence terminated this trading arrangement. No other officers, as defined in Rule 16a-1(f), or directors adopted and/or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as defined in Item 408 of Regulation S-K, during the fourth fiscal quarter of 2023. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable. 42 PART III The information required for the Items contained in Part III is incorporated herein by reference from our definitive proxy statement for our 2024 Annual Meeting of Stockholders (the “Proxy Statement”), which will be filed with the SEC no later than 120 days after December 31, 2023. ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE ITEM 11. EXECUTIVE COMPENSATION ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES 43 PART IV ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES Financial Statement Schedules Our consolidated financial statements are listed on the Index to Financial Statements on this annual report on Form 10-K beginning on page F-1. All financial statement schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto. Our independent registered public accounting firm is Marcum LLP (PCAOB ID # 688 ) of Houston, Texas. 44 RELMADA THERAPEUTICS, INC. (INDEX TO FINANCIAL STATEMENTS) Page Report of Independent Registered Public Accounting Firm F-2 Consolidated Balance Sheets as of December 31, 2023 and 2022 F-3 Consolidated Statements of Operations for the Years Ended December 31, 2023 and 2022 F-4 Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2023 and 2022 F-5 Consolidated Statements of Cash Flows for the Years Ended December 31, 2023 and 2022 F-6 Notes to Consolidated Financial Statements F-7 F- 1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and Board of Directors of Relmada Therapeutics, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Relmada Therapeutics, Inc. (the “Company”) as of December 31, 2023 and 2022, the related consolidated statements of operations, changes in stockholders’ equity and cash flows for each of the two years in the period ended December 31, 2023, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters. /s/ Marcum llp Marcum llp We have served as the Company’s auditor since 2014 . Houston, Texas March 19, 2024 F- 2 Relmada Therapeutics, Inc. Consolidated Balance Sheets As of As of December 31, December 31, 2023 2022 Assets Current assets: Cash and cash equivalents $ 4,091,568 $ 5,395,905 Short-term investments 92,232,292 142,926,781 Other receivables - 512,432 Prepaid expenses 1,185,057 4,035,186 Total current assets 97,508,917 152,870,304 Other assets 43,125 34,875 Total assets $ 97,552,042 $ 152,905,179 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable $ 3,506,009 $ 5,261,936 Accrued expenses 8,688,791 7,206,941 Total current liabilities 12,194,800 12,468,877 Total liabilities 12,194,800 12,468,877 Commitments and Contingencies (Note 7) Stockholders’ Equity: Preferred stock, $ 0.001 par value, 200,000,000 shares authorized, none issued and outstanding - - Class A convertible preferred stock, $ 0.001 par value, 3,500,000 shares authorized, none issued and outstanding - - Common stock, $ 0.001 par value, 150,000,000 shares authorized, 30,099,203 and 30,099,203 shares issued and outstanding, respectively 30,099 30,099 Additional paid-in capital 646,229,824 602,517,138 Accumulated deficit ( 560,902,681 ) ( 462,110,935 ) Total stockholders’ equity 85,357,242 140,436,302 Total liabilities and stockholders’ equity $ 97,552,042 $ 152,905,179 The accompanying notes are an integral part of these consolidated financial statements. F- 3 Relmada Therapeutics, Inc. Consolidated Statements of Operations For the Years Ended December 31, 2023 and 2022 2023 2022 Operating expenses: Research and development $ 54,807,348 $ 113,322,999 General and administrative 48,894,945 47,926,077 Total operating expenses 103,702,293 161,249,076 Loss from operations ( 103,702,293 ) ( 161,249,076 ) Other income (expenses): Gain on settlement of fees - 6,351,606 Interest/investment income, net 5,151,704 2,659,424 Realized loss on short-term investments ( 4,064,391 ) ( 585,522 ) Unrealized gain (loss) on short-term investments 3,823,234 ( 4,220,255 ) Total other income (expenses), net 4,910,547 4,205,253 Net loss $ ( 98,791,746 ) $ ( 157,043,823 ) Net loss per common share – basic and diluted $ ( 3.28 ) $ ( 5.30 ) Weighted average number of common shares outstanding – basic and diluted 30,099,203 29,628,664 The accompanying notes are an integral part of these consolidated financial statements. F- 4 Relmada Therapeutics, Inc. Consolidated Statements of Changes in Stockholders’ Equity For the Years Ended December 31, 2023 and 2022 Common Stock Additional Paid-in Accumulated Shares Par Value Capital Deficit Total Balance – December 31, 2021 27,740,147 $ 27,740 $ 513,304,258 $ ( 305,067,112 ) $ 208,264,886 Stock-based compensation expense - - 44,194,765 - 44,194,765 ATM offering, net 2,094,243 2,094 42,726,505 - 42,728,599 Share exchange – Prefunded warrants, net of fees ( 1,452,016 ) ( 1,452 ) ( 48,548 ) - ( 50,000 ) Net exercise – Prefunded warrants 1,451,795 1,452 ( 1,452 ) - - Warrants exercised 181,336 181 1,264,342 - 1,264,523 Options exercised 83,698 84 703,636 - 703,720 Short swing profit, net - - 373,632 - 373,632 Net loss - - - ( 157,043,823 ) ( 157,043,823 ) Balance – December 31, 2022 30,099,203 30,099 602,517,138 ( 462,110,935 ) 140,436,302 Stock-based compensation expense - - 43,811,149 - 43,811,149 ATM fees - - ( 98,463 ) - ( 98,463 ) Net loss - - - ( 98,791,746 ) ( 98,791,746 ) Balance – December 31, 2023 30,099,203 $ 30,099 $ 646,229,824 $ ( 560,902,681 ) $ 85,357,242 The accompanying notes are an integral part of these consolidated financial statements. F- 5 Relmada Therapeutics, Inc. Consolidated Statements of Cash Flows For the Years Ended December 31, 2023 and 2022 2023 2022 Cash flows from operating activities Net loss $ ( 98,791,746 ) $ ( 157,043,823 ) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation 43,811,149 44,194,765 Gain on settlement - ( 6,351,606 ) Realized loss on short-term investments 4,064,391 585,522 Unrealized (gain) loss on short-term investments ( 3,823,234 ) 4,220,255 Change in operating assets and liabilities: Lease payment receivable - 86,377 Other receivable 512,432 ( 512,432 ) Prepaid expenses and other assets 2,841,879 7,259,767 Accounts payable ( 1,755,927 ) 421,040 Accrued expenses 1,481,850 3,338,518 Net cash used in operating activities ( 51,659,206 ) ( 103,801,617 ) Cash flows from investing activities Purchase of short-term investments ( 90,463,532 ) ( 47,293,763 ) Sale of short-term investments 140,916,864 67,027,372 Net cash provided by investing activities 50,453,332 19,733,609 Cash flows from financing activities Payment of ATM fees ( 98,463 ) - Payment of fees for warrants issued for common stock - ( 50,000 ) Proceeds from issuance of common stock - 42,728,599 Proceeds from options exercised for common stock - 703,720 Proceeds from warrants exercised for common stock - 1,264,523 Proceeds from short swing profit, net - 373,632 Net cash (used in) provided by financing activities ( 98,463 ) 45,020,474 Net decrease in cash and cash equivalents ( 1,304,337 ) ( 39,047,534 ) Cash and cash equivalents at beginning of the year 5,395,905 44,443,439 Cash and cash equivalents at end of the year $ 4,091,568 $ 5,395,905 2023 2022 Supplemental disclosure of cash flow information: Non-cash operating transactions: Forgiveness of accounts payable related to gain $ - $ 3,212,583 Non-cash investing and financing transactions: Share exchange for Pre-funded warrants $ - $ 1,452 Net exercise of Pre-funded warrants $ - $ ( 1,452 ) The accompanying notes are an integral part of these consolidated financial statements. F- 6 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements NOTE 1 - BUSINESS Relmada Therapeutics Inc. (Relmada or the Company) (a Nevada corporation) is a clinical-stage, publicly traded biotechnology company focused on the development of esmethadone (d-methadone, dextromethadone, REL-1017), an N-methyl-D-aspartate (NMDA) receptor antagonist. Esmethadone is a New Chemical Entity (NCE) that potentially addresses areas of high unmet medical need in the treatment of central nervous system (CNS) diseases and other disorders. The Company is also developing a novel psilocybin (REL-P11) in doses that we believe are lower than those associated with psychedelic effects for the treatment of metabolic indications. In addition to the normal risks associated with a new business venture, there can be no assurance that the Company’s research and development will be successfully completed or that any product will be approved or commercially viable. The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, dependence on collaborative arrangements, development by the Company or its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, and compliance with the Food and Drug Administration (FDA) and other governmental regulations and approval requirements. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). The consolidated financial statements include the Company’s accounts and those of the Company’s wholly-owned subsidiary. All significant intercompany accounts and transactions have been eliminated in consolidation. Liquidity As shown in the accompanying consolidated financial statements, the Company incurred negative operating cash flows of $ 51,659,206 for the year ended December 31, 2023 and has an accumulated deficit of $ 560,902,681 from inception through December 31, 2023. Relmada has funded its past operations through equity raises. There were no equity raises in the year ended December 31, 2023. Management believes that the Company’s existing cash and cash equivalents will enable them to fund operating expenses and capital expenditure requirements for at least 12 months from the issuance of these consolidated financial statements. Beyond that point management will evaluate the size and scope of any subsequent operations and clinical trials that will affect the timing of additional financings through public or private sales of equity or debt securities or from bank or other loans or through strategic collaboration and/or licensing agreements. Any such expenditures related to any subsequent clinical trials will not be incurred until such additional financing is raised. Further, additional financing related to subsequent trials does not affect the Company’s conclusion that based on the cash on hand and the budgeted cash flow requirements, the Company has sufficient funds to maintain operations for at least 12 months from the issuance of these consolidated financial statements. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses for the reporting period. Actual results could differ from those estimates. The significant estimates are stock-based compensation expenses, and recorded amounts related to income taxes. Cash and Cash Equivalents The Company considers cash deposits and all highly liquid investments with a maturity of three months or less when purchased to be cash and cash equivalents. The Company’s cash and cash equivalents are held at two high-credit-quality financial institutions. The Company’s cash and cash equivalents of $ 4,091,568 at December 31, 2023 at these institutions exceed federally insured limits. Short-term Investments The Company’s investments consist entirely of mutual funds. The securities are measured at fair value based on the net asset value (“NAV”). The Company adopted FASB ASU 2016-01, Financial Instruments, which requires substantially all equity investments in nonconsolidated entities to be measured at fair value with recurring changes recognized in earnings, except for those accounted for using equity method accounting. Changes in fair value of the securities are recorded as part of other income on the consolidated statement of operations. Short term investment activity is presented in the investing activities section on the consolidated statement of cash flows. Short-term investments at December 31, 2023 consisted of mutual funds with a fair value of $ 92,232,292 . Patents Costs related to filing and pursuing patent applications are recorded as general and administrative expense and expensed as incurred since recoverability of such expenditures is uncertain. F- 7 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements Leases The Company recognizes its leases with a term of greater than a year on the balance sheet by recording right-of-use assets and lease liabilities. Leases can be classified as either operating leases or finance leases. Operating leases will result in straight-line lease expense, while finance leases will result in front-loaded expense. The Company’s lease consists of an operating leases for office space. The Company does not recognize a lease liability or right-of-use asset on the balance sheet for short-term leases. Instead, the Company recognizes short-term lease payments as an expense on a straight-line basis over the lease term. A short-term lease is defined as a lease that, at the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise. Gain on Settlement The Company recognizes a gain when cash (or other assets, such as claims to cash) has been received without the expectation of repayment. A gain is recorded when the assets are readily convertible to know amounts of cash or claims to cash. Gains are reported as part of other income (expense) on the consolidated statement of operations. The Company recorded a gain on settlement of $ 0 and $ 6,351,606 included in other income (expense) for the years ended December 31, 2023 and 2022, respectively. Fair Value of Financial Instruments The Company’s financial instruments primarily include cash, short term investments derivative liabilities and accounts payable. Due to the short-term nature of cash and accounts payable the carrying amounts of these assets and liabilities approximate their fair value. Derivatives are recorded at fair value at each period end. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. A fair value hierarchy has been established for valuation inputs that gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows: Level 1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means. Level 3 Inputs - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). The Company’s short-term investment instruments of $ 92,232,292 at December 31, 2023 are classified using Level 1 inputs within the fair value hierarchy because they are valued using NAV. Unrealized gains and losses are recorded in the consolidated statement of operations as unrealized gain on short-term investments. The Company recorded an unrealized gain of $ 3,823,234 and an unrealized loss of $ 4,220,255 , included in other income (expense) for the years ended December 31, 2023 and 2022, respectively. Fair Value on a Recurring Basis As required by Accounting Standard Codification (ASC) Topic No. 820 - 10 Fair Value Measurement , financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. Income Taxes The Company accounts for income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in the tax rate is recognized in income or expense in the period that the change is effective. Tax benefits are recognized when it is probable that the deduction will be sustained. A valuation allowance is established when it is more likely than not that all or a portion of a deferred tax asset will either expire before the Company is able to realize the benefit, or that future deductibility is uncertain. At December 31, 2023 and 2022, the Company had recorded a valuation allowance to the full extent of the Company’s net deferred tax assets since the likelihood of realization of the benefit does not meet the more likely than not threshold. F- 8 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements The Company files a U.S. Federal income tax return and various state returns. Uncertain tax positions taken on our tax returns will be accounted for as liabilities for unrecognized tax benefits. The Company will recognize interest and penalties, if any, related to unrecognized tax benefits in general and administrative expenses in the statements of operations. There were no liabilities recorded for uncertain tax positions at December 31, 2023 and 2022. The open tax years, subject to potential examination by the applicable taxing authority, for the Company are from June 30, 2018 forward. Research and Development Research and development costs primarily consist of research contracts for the advancement of product development, salaries and benefits, stock-based compensation, and consultants. The Company expenses all research and development costs in the period incurred. The Company makes an estimate of costs in relation to clinical study contracts. The Company analyzes the progress of studies, including the progress of clinical studies and phases, invoices received and contracted costs when evaluating the adequacy of the amount expensed and the related prepaid asset and accrued liability. Stock-Based Compensation The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. That cost is recognized over the period during which an employee is required to provide service in exchange for the award - the requisite service period. The grant-date fair value of employee share options is estimated using the Black-Scholes option pricing model adjusted for the unique characteristics of those instruments. Net Loss per Common Share Basic net loss per common share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding for the period, without consideration for common stock equivalents. Diluted net loss per common share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common share equivalents outstanding for the period determined using the treasury-stock method. Dilutive common stock equivalents are comprised of Class A convertible preferred stock, Series A preferred stock, options and warrants to purchase common stock. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net losses in each period. The potentially dilutive securities that would be anti-dilutive due to the Company’s net loss are not included in the calculation of diluted net loss per share attributable to common stockholders. The anti-dilutive securities are as follows (in common stock equivalent shares): Year ended December 31, Year ended December 31, 2023 2022 Common stock warrants 2,381,366 3,027,441 Common stock options 17,416,192 12,122,606 Total 19,797,558 15,150,047 F- 9 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements Recent Accounting Pronouncements In October 2021, the FASB issued ASU 2021-08, “ Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers ”. The amendments in this ASU require that an entity (acquirer) recognize, and measure contract assets and contract liabilities acquired in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers, as if it had originated the contracts as of the acquisition date. The amendments in this ASU were effective for annual and interim periods beginning after December 15, 2022. The Company adopted this standard effective January 1, 2023 and the standard did not have a significant impact on our consolidated financial statements. In November 2023, The FASB issued ASU 2023-07, “ Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ” which expands annual and interim disclosures for reportable segments, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for our annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on our financial statement disclosures. In December 2023, the FASB issued ASU 2023-09, “ Income Taxes (Topic 740): Improvements to Income Tax Disclosures ” to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for our annual periods beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on our financial statement disclosures. F- 10 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements NOTE 3 - PREPAID EXPENSES Prepaid expenses consisted of the following (rounded to nearest $00): December 31, 2023 December 31, 2022 Insurance $ 365,100 $ 313,200 Research and Development 695,000 3,619,800 Other 125,000 102,200 Total $ 1,185,100 $ 4,035,200 NOTE 4 - ACCRUED EXPENSES Accrued expenses consisted of the following (rounded to nearest $00): December 31, 2023 December 31, 2022 Research and development $ 5.394,700 $ 5,809,800 Professional fees 174,000 116,500 Accrued bonus 2,632,400 492,100 Accrued vacation 372,200 529,800 Other 115,500 258,700 Total $ 8,688,800 $ 7,206,900 NOTE 5 - STOCKHOLDERS’ EQUITY Common Stock During the year ended December 31, 2023, the Company did not issue any shares of common stock for the exercise of warrants. During the year ended December 31, 2022, the Company issued 181,336 shares of common stock for the exercise of warrants for proceeds of $ 1,264,523 . During the year ended December 31, 2023, the Company did not issue any shares of common stock for the exercise of options. During the year ended December 31, 2022, the Company issued 83,698 shares of common stock for the exercise of options for proceeds of $ 703,720 . On May 15, 2020, the Company entered into an Open Market Sale Agreement with Jefferies LLC, as sales agent (“Jefferies”), pursuant to which the Company offered to sell, from time to time, through Jefferies, shares of the Company’s common stock, having an aggregate offering price of up to $ 75,000,000 . The Company was not obligated to sell any shares under the agreement. During the years ended December 31, 2023 and 2022, the Company issued 0 and 2,094,243 shares of common stock for net cash proceeds of $ 0 and $ 42,728,599 under the agreement, respectively. As of December 31, 2023, no shares were available to be issued under this agreement. On April 6, 2022, the Company entered into a new Open Market Sale Agreement with Jefferies, as sales agent, pursuant to which we may offer and sell, from time to time, through Jefferies, shares of our common stock, having an aggregate offering price of up to $ 100,000,000 . We are not obligated to sell any shares under the agreement. As of December 31, 2023, no shares have been issued under this agreement. During the years ended December 31, 2023 and 2022, there were no common stock shares issued for issuances of restricted common stock. F- 11 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements Stock-based compensation - options In December 2014, the Board of Directors adopted and the shareholders approved Relmada’s 2014 Stock Option and Equity Incentive Plan, as amended (the “2014 Plan”), which allows for the granting of 5,152,942 common stock awards, stock appreciation rights, and incentive and nonqualified stock options to purchase shares of the Company’s common stock to designated employees, non-employee directors, and consultants and advisors. In May 2021, the Company’s Board of Directors adopted and shareholders approved the Company’s 2021 Equity Incentive Plan (the “2021 Plan”), which allowed for the granting of 1,500,000 options or other stock awards. In May 2022, the Company’s Board of Directors adopted, and shareholders approved an amendment to the 2021 Plan to increase the shares of the Company’s common stock available for issuance thereunder by 3,900,000 shares. In May 2023, the Company’s Board of Directors adopted and shareholders approved an amendment to the 2021 Plan to increase the shares of the Company’s common stock available for issuance thereunder by 2,500,000 shares. These combined plans allowed for the granting of up to 13,052,942 options or other stock awards. Stock options are exercisable generally for a period of 10 years from the date of grant and generally vest either over four years or upon achievement of certain specified corporate or other milestones. As of December 31, 2023, there were no shares available to be granted under either the 2014 or 2021 Plan. The shareholders will vote at their annual meeting in 2024 on a management proposal to increase the shares available to be issued under the 2021 Plan. There can be no assurance such amendment will be approved. As of December 31, 2023, options for 4,363,250 shares of common stock had been issued subject to approval by the shareholders of this amendment. If the amendment is not approved, such options will be forfeited. The Company uses the simplified method for share-based compensation to estimate the expected term for employee option awards for share-based compensation in its option-pricing model. From November 13, 2023 through December 15, 2023, the Company awarded a total of 5,010,000 options to consultants and employees with an exercise price ranging from $ 2.48 to $ 2.82 and a 10 -year term vesting over a 4 -year period. The options granted include time-based vesting grants. The options have an aggregate fair value of approximately $ 10,703,070 calculated using the Black Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 3.93 – 4.68 % (2) expected life of 6.25 years, (3) expected volatility of 113 - 114 %, and (4) zero expected dividends. From August 1, 2023 through September 18, 2023, 10,000 options were issued to various employees with an exercise price ranging from $ 2.56 to $ 2.96 and a 10 -year term, vesting over a 4 -year period. The options granted include time-based vesting grants. The options have an aggregate fair value of approximately $ 23,840 calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 4.20 – 4.44 % (2) expected life of 6.25 years, (3) expected volatility of 113 - 114 %, and (4) zero expected dividends. From April 10, 2023 through June 20, 2023, 60,000 options were issued to various employees with an exercise price ranging from $ 2.28 to $ 3.32 and a 10 -year term, vesting over a 4 -year period. The options granted include time-based vesting grants. The options have an aggregate fair value of approximately $ 148,420 calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 3.43 – 3.91 % (2) expected life of 6.25 years, (3) expected volatility of 114 %, and (4) zero expected dividends. From January 6, 2023 through February 21, 2023, 620,000 options were issued to various consultants and employees with an exercise price ranging from $ 3.18 to $ 4.30 and a 10 -year term, vesting over a 4 -year period. The options have an aggregate fair value of approximately $ 1,933,613 calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 3.46 – 4.12 % (2) expected life of 6.25 years, (3) expected volatility of 115 - 116 %, and (4) zero expected dividends. From December 16, 2022 through December 21, 2022, the Company awarded a total of 2,800,000 options to consultants and employees with an exercise price ranging from $ 3.20 to $ 3.37 and a 10 -year term vesting over a 4 -year period. The options granted include time-based vesting grants. The options have an aggregate fair value of $ 8,169,325 calculated using the Black Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 3.60 – 3.78 % (2) expected life of 6.25 years, (3) expected volatility of 115 %, and (4) zero expected dividends. On December 16, 2022, the Company awarded a total of 199,432 options to employees with an exercise price of $ 3.37 and a 10 -year term vesting immediately. The options have an aggregate fair value of $ 561,902 calculated using the Black Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 3.61 % (2) expected life of 5 years, (3) expected volatility of 120 %, and (4) zero expected dividends. From July 1, 2022 through September 29, 2022, 260,000 options were issued to various consultants with an exercise price ranging from $ 18.30 to $ 36.19 and a 10 -year term, vesting over a 4 year period. The options granted include time-based vesting grants. The options have an aggregate fair value of approximately $ 5.0 million calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 2.9 – 3.94 % (2) expected life of 6.25 years, (3) expected volatility of 93 - 94 %, and (4) zero expected dividends. F- 12 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements From April 25, 2022 through May 5, 2022, 260,000 options were issued to various consultants with an exercise price ranging from $ 22.40 to $ 25.52 and a 10 -year term, vesting over a 4 -year period. The options granted include time-based vesting grants. The options have an aggregate fair value of approximately $ 4.6 million, calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 2.85 – 3.04 % (2) expected life of 6.25 years, (3) expected volatility of 95 %, and (4) zero expected dividends. On March 28, 2022, the Company awarded a total of 15,000 options to an employee with an exercise price of $ 25.76 and a 10 -year term vesting over a 4 -year period. The options granted include time-based vesting grants. The options have an aggregate fair value of $ 307,845 calculated using the Black Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 2.55 % (2) expected life of 6.25 years, (3) expected volatility of 98 %, and (4) zero expected dividends. From January 5, 2022 through March 14, 2022, 110,000 options were issued to various consultants with an exercise price ranging from $ 18.00 to $ 21.46 and a 10 -year term, vesting over a 4 -year period. The options granted include time-based vesting grants. The options have an aggregate fair value of approximately $ 1.6 million, calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 1.53 – 2.00 % (2) expected life of 6.25 years, (3) expected volatility of 98 %, and (4) zero expected dividends. On January 1, 2022, 50,000 options were issued to a consultant with an exercise price of $ 22.53 and a 10 -year term, vesting over a 1 -year period. The options granted include performance vesting based on the Company’s achievement of performance metrics. The options have an aggregate fair value of $ 847,583 , calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 1.53 % (2) expected life of 5.5 years, (3) expected volatility of 96 %, and (4) zero expected dividends. Options A summary of the changes in options outstanding for the years ended December 31, 2023 and 2022 is as follows: Number of Shares Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding and expected to vest at December 31, 2021 10,330,622 $ 22.52 9.0 $ 46,088,534 Granted 3,744,432 7.40 9.8 - Exercised ( 83,698 ) - - - Forfeited ( 1,868,750 ) - - - Outstanding and expected to vest at December 31, 2022 12,122,606 $ 18.19 8.5 $ 417,998 Granted 5,700,000 $ 2.61 9.9 - Forfeited ( 406,414 ) - - - Outstanding and expected to vest at December 31, 2023 17,416,192 $ 12.99 8.3 $ 11,183,370 Options exercisable at December 31, 2023 7,161,748 $ 20.25 7.0 $ 1,015,520 On September 5, 2023, Dr. Eric Schmidt, a member of the Board of Directors (the “Board”), notified the Company that he would resign from the Board, effective immediately. On September 22, 2023, the Board voted and approved that all of Dr. Schmidt’s unvested options would vest immediately and be exercisable through the original term of the respective grants. In addition, the Board approved the extension of the exercise period for the options which were vested on September 5, 2023 from 90 days to the original term of the respective options. As a result of the modifications, the Company recorded approximately $ 1.2 million of stock-based compensation during the year ended December 31, 2023. At December 31, 2023, the Company has unrecognized stock-based compensation expense of approximately $ 62,386,500 related to unvested stock options over the weighted average remaining service period of 2.5 years. The weighted average fair value of options granted during the years ended December 31, 2023 and 2022 was approximately $ 2.61 and $ 7.40 per share, respectively, on the date of grant using the Black-Scholes option pricing model with the following assumptions: Years Ended Years Ended December 31, December 31, 2023 2022 Risk free interest rate 3.43 to 4.68 % 1.53 to 3.94 % Dividend yield 0 % 0 % Volatility 113 - 116 % 93 - 120 % Expected term (in years) 6.25 5 to 6.25 F- 13 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements Warrants A summary of the changes in outstanding warrants during the years ended December 31, 2023 and 2022 is as follows: Number of Shares Weighted Average Exercise Price Per Share Outstanding at December 31, 2021 3,208,777 $ 16.45 Issued 1,452,016 0.001 Exercised ( 1,633,352 ) 0.77 Outstanding at December 31, 2022 3,027,441 $ 17.02 Forfeited ( 646,075 ) $ 1.50 Outstanding at December 31, 2023 2,381,366 $ 20.02 Warrants exercisable at December 31, 2023 2,235,366 $ 19.20 There were no warrants issued during the year ended December 31, 2023. On September 20, 2022, the Company entered into an agreement with an investor to exchange 1,452,016 shares of outstanding common stock for 1,452,016 prefunded warrants. The 1,452,016 shares of common stock were returned. These warrants have an exercise price of $ 0.001 and a 9.99 % beneficial ownership limitation. On October 19, 2022 a cashless exercise of the 1,452,016 prefunded warrants was transacted with 1,451,795 shares of common shares issued and the remaining 221 warrants being cancelled. At December 31, 2023, the Company had approximately $ 3,200,000 of unrecognized stock-based compensation expense related to outstanding warrants. At December 31, 2023, the aggregate intrinsic value of warrants vested and outstanding was approximately $ 19,000 . Stock-based compensation by class of expense The following summarizes the components of stock-based compensation expense which includes common stock, stock options, warrants and restricted stock in the consolidated statements of operations (rounded to nearest $00): Year Ended Year Ended December 31, December 31, 2023 2022 Research and development $ 7,224,000 $ 7,882,700 General and administrative 36,587,100 36,312,100 Total $ 43,811,100 $ 44,194,800 F- 14 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements NOTE 6 - INCOME TAXES No provision or benefit for federal or state income taxes has been recorded because the Company has incurred net losses for all periods presented and has recorded a valuation allowance against its deferred tax assets. The components of the Company’s deferred tax assets are as follows at: December 31, 2023 December 31, 2022 Deferred tax assets: Federal net operating loss $ 21,016,000 $ 24,964,000 State net operating loss 3,771,000 13,781,000 Research and development tax credits 2,238,000 7,902,000 Capitalized R&D 49,581,000 45,666,000 Nonqualified Stock Options 29,305,000 19,803,000 Accruals 1,616,000 1,546,000 Intangibles and Fixed Assets 2,599,000 2,732,000 Other 11,000 2,000 Less: valuation allowance ( 110,137,000 ) ( 116,396,000 ) Total $ - $ - The Company has maintained a full valuation allowance against its deferred tax assets at December 31, 2023 and 2022. A valuation allowance is required to be recorded when it is more likely than not that some portion or all of the net deferred tax assets will not be realized. Since the Company cannot be assured of realizing the net deferred tax asset, a full valuation allowance has been provided. The valuation allowance (decreased)/increased for the years ended December 31, 2023 and 2022 by approximately $( 6,259,000 ) and $ 20,201,000 , respectively. Deferred tax asset for net operating loss carryforwards at December 31, 2023 was adjusted with the corresponding offset to valuation allowance. At December 31, 2023, the Company had federal, New York State and New York City net operating loss (NOL) carryforwards of approximately $ 100,077,000 , $ 15,016,000 and $ 14,998,000 respectively, which begin expiring in 2027, 2032 and 2032, respectively. Approximately $ 88,611,000 federal NOL can be carried forward indefinitely but it is limited to 80 % of future taxable income. The Company also has federal research and development tax credit carryforwards of approximately $ 2,237,600 that will begin to expire in 2042. The Company’s ability to use its NOL carryforwards may be limited if it experiences an “ownership change” as defined in Section 382 (“Section 382”) of the Internal Revenue Code of 1986, as amended. An ownership change generally occurs if certain stockholders increase their aggregate percentage ownership of a corporation’s stock by more than 50 percentage points over their lowest percentage ownership at any time during the testing period, which is generally the three-year period preceding any potential ownership change. Sections 382 and 383 of the Internal Revenue Code of 1986 subject the future utilization of net operating losses and certain other tax attributes, such as research and development tax credits, to an annual limitation in the event of certain ownership changes, as defined. The Company has undergone and ownership change and has determined that various “changes in ownership” as defined by IRS Section 382 did occur. Accordingly, about $111,168,000 of the Company’s NOL carryforwards are limited. Approximately, $ 41,562,000 of NOLs and $ 7,346,000 of R&D Credits are expected to expire unused. The deferred tax assets associated with the attributes that will expire without utilization have been written-off. There are $ 1,109,000 of NOLs available for use after the October 13, 2022 change in 2023. In subsequent years, the NOLs available from the October 13, 2022 change under section 382 are $ 740,000 , annually. A reconciliation of the statutory tax rate to the effective tax rate is as follows: Year Ended December 31, 2023 Year Ended December 31, 2022 Statutory federal income tax rate 21.00 % 21.00 % State (net of federal benefit) ( 6.56 )% ( 9.46 )% Non-deductible expenses ( 5.34 )% ( 0.53 )% R&D Credit 1.70 % 1.64 % NOL and R&D adjustment due to 382 ( 16.27 )% 0.00 % Permanent true-ups ( 0.89 )% 0.00 % Other 0.02 % 0.22 % Change in valuation allowance 6.34 % ( 12.87 )% Effective income tax rate 0 % 0 % F- 15 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements The Company does not have any uncertain tax positions at December 31, 2023 and 2022, that would affect its effective tax rate. The Company does not anticipate a significant change in the amount of unrecognized tax benefits over the next twelve months. Because the Company is in a loss carryforward position, the Company is generally subject to US federal and state income tax examinations by tax authorities for all years for which a loss carryforward is available. If and when applicable, the Company will recognize interest and penalties as part of income tax expense. NOTE 7 - COMMITMENTS AND CONTINGENCIES License Agreements Wonpung On August 20, 2007, the Company entered into a License Development and Commercialization Agreement with Wonpung Mulsan Co, a shareholder of the Company. Wonpung has exclusive territorial rights in countries it selects in Asia to market up to two drugs the Company is currently developing and a right of first refusal (ROFR) for up to an additional five drugs that the Company may develop in the future as defined in more detail in the license agreement. If the parties cannot agree to terms of a license agreement, then the Company shall be able to engage in discussions with other potential licensors. As of March 19, 2024, no discussions are active between the Company and Wonpung. The Company received an upfront license fee of $ 1,500,000 and will earn royalties of up to 12 % of net sales for up to two licensed products it is currently developing. The licensing terms for the ROFR products are subject to future negotiations and binding arbitration. The terms of each licensing agreement will expire on the earlier of any time from 15 years to 20 years after licensing or on the date of commercial availability of a generic product to such licensed product in the licensed territory. Third Party Licensor Based upon a prior acquisition, the Company assumed an obligation to pay a third party (Dr. Charles E. Inturrisi and Dr. Paolo Manfredi – see below): (A) royalty payments up to 2 % on net sales of licensed products that are not sold by sublicensee and (B) on each and every sublicense earned royalty payment received by licensee from its sublicensee on sales of license product by sublicensee, the higher of (i) 20 % of the royalties received by licensee; or (ii) up to 2 % of net sales of sublicensee. The Company will also make milestone payments of up to $ 4 or $ 2 million, for the first commercial sale of product in the field that has a single active pharmaceutical ingredient, and for the first commercial sale of product in the field of product that has more than one active pharmaceutical ingredient, respectively. As of December 31, 2023, the Company has not generated any revenue related to this license agreement. Inturrisi / Manfredi In January 2018, we entered into an Intellectual Property Assignment Agreement (the Assignment Agreement) and License Agreement (the “License Agreement” and together with the Assignment Agreement, the Agreements) with Dr. Charles E. Inturrisi and Dr. Paolo Manfredi (collectively, the Licensor). Pursuant to the Agreements, Relmada assigned its existing rights, including patents and patent applications, to esmethadone in the context of psychiatric use (the Existing Invention) to Licensor. Licensor then granted Relmada under the License Agreement a perpetual, worldwide, and exclusive license to commercialize the Existing Invention and certain further inventions regarding esmethadone in the context of other indications such as those contemplated above. In consideration of the rights granted to Relmada under the License Agreement, Relmada paid the Licensor an upfront, non-refundable license fee of $ 180,000 . Additionally, Relmada will pay Licensor $ 45,000 every three months until the earliest to occur of the following events: (i) the first commercial sale of a licensed product anywhere in the world, (ii) the expiration or invalidation of the last to expire or be invalidated of the patent rights anywhere in the world, or (iii) the termination of the License Agreement. Relmada will also pay Licensor tiered royalties with a maximum rate of 2 %, decreasing to 1.75 %, and 1.5 % in certain circumstances, on net sales of licensed products covered under the License Agreement. Relmada will also pay Licensor tiered payments up to a maximum of 20 %, and decreasing to 17.5 %, and 15 % in certain circumstances, of all consideration received by Relmada for sublicenses granted under the License Agreement. As of December 31, 2023, no events have occurred, and the Company continues to pay Licensor $ 45,000 every three months. F- 16 Relmada Therapeutics, Inc. Notes to Consolidated Financial Statements Arbormentis, LLC On July 16, 2021, the Company entered into a License Agreement with Arbormentis, LLC, a privately held Delaware limited liability company, by which the Company acquired development and commercial rights to a novel psilocybin and derivate program from Arbormentis, LLC, worldwide excluding the countries of Asia. The Company will collaborate with Arbormentis, LLC on the development of new therapies targeting neurological and psychiatric disorders, leveraging its understanding of neuroplasticity, and focusing on this emerging new class of drugs targeting the neuroplastogen mechanism of action. Under the terms of the License Agreement, the Company paid Arbormentis, LLC an upfront fee of $ 12.7 million, consisting of a mix of cash and warrants to purchase the Company’s common stock, in addition to potential milestone payments totaling up to approximately $ 160 million related to pre-specified development and commercialization milestones. Arbormentis, LLC is also eligible to receive a low single digit royalty on net sales of any commercialized therapy resulting from this agreement. The license agreement is terminable by the Company but is perpetual and not terminable by the licensor absent material breach of its terms by the Company. The new licensed program stems from an international collaboration among U.S., European and Swiss scientists that has focused on the discovery and development of compounds that may promote neural plasticity. Dr. Paolo Manfredi, Relmada’s Acting Chief Scientific Officer and co-inventor of REL-1017, and Dr. Marco Pappagallo, Relmada’ s Safety/Adjudication Officer, are among the scientists affiliated with Arbormentis, LLC. Leases and Subleases On August 1, 2021, the Company relocated its corporate headquarters to 2222 Ponce de Leon, Floor 3, Coral Gables, FL 33134, pursuant to a lease agreement with monthly rent of approximately $ 11,000 . The lease period was for five months . The lease agreement expired on December 31, 2021 and was renewed for the calendar year 2022, 2023 and 2024 with monthly rent of approximately $ 9,000 , $ 7,000 and $ 7,000 , respectively. Beginning on January 1, 2023, we also leased office space at 880 Third Avenue, 12 th Floor, New York, NY 10022 with monthly rent of approximately $ 14,500 that was terminated on November 30, 2023. Beginning on December 1, 2023, we leased office space at 12 E 49 th Street, New York, NY 10022 for with monthly rent of approximately $ 12,000 that expires on July 31, 2024. In accordance with ASC 842, Leases , the Company recognizes rent expense evenly over the 12 months. The Company incurred rent expense of approximately $ 283,600 and $ 129,600 for the years ended December 31, 2023 and 2022, respectively. On June 8, 2017, the Company entered into an Amended and Restated License Agreement with Actinium. Pursuant to the terms of the agreement, Actinium licensed the furniture, fixtures, equipment and tenant improvements located in the office (FFE) for a license fee of $ 7,529 per month until December 8, 2022. Actinium had at any time during the term of this agreement the right to purchase the FFE for $ 496,914 , less any previously paid license fees. On July 7, 2022, Actinium exercised its right to purchase the FFE for $ 52,698 . The license of FFE qualifies as a sales-type lease. At inception, the Company derecognized the underlying assets of $ 493,452 , recognized discounted lease payments receivable of $ 397,049 using the discount rate of 8.38 % and recognized loss on sales-type lease of fixed assets of $ 96,403 . As of December 31, 2023 and 2022, there was no unearned interest income. Legal From time to time, the Company may become involved in lawsuits and other legal proceedings that arise in the course of business. Litigation is subject to inherent uncertainties, and it is not possible to predict the outcome of litigation with total confidence. Except as disclosed below, the Company is currently not aware of any legal proceedings or potential claims against it whose outcome would be likely, individually or in the aggregate, to have a material adverse effect on the Company’s business, financial condition, operating results, or cash flows. NOTE 8 - OTHER POSTRETIREMENT BENEFIT PLAN Relmada participates in a multiemployer 401(k) plan that permits eligible employees to contribute funds on a pretax basis subject to maximum allowed under federal tax provisions. The Company matches 100% of the first 3% of employee contributions, plus 50% of employee contributions that exceed 3% but do not exceed 5%. The employees choose an amount from various investment options for both their contributions and the Company’s matching contribution. The Company’s contribution expense was $ 140,982 and $ 105,216 for the years ended December 31, 2023 and 2022, respectively. NOTE 9 - SUBSEQUENT EVENTS The Company’s management reviewed all material events through the date the financial statements were issued for subsequent event disclosure consideration. From January 1, 2024 through March 19, 2024, 50,000 options were issued to an advisor with an exercise price of $ 3.44 and a 10 -year term, vesting over a 4 -year period. These options awarded are subject to shareholder approval. On January 31, 2024 Executive officers purchased 171,645 shares of common stock at a weighted average purchase price of $ 3.86 . Subsequent to December 31, 2023, 74,999 outstanding options were exercised for total cash proceeds of $ 246,747 . F- 17 Exhibits Certain of the agreements filed as exhibits to this Report contain representations and warranties by the parties to the agreements that have been made solely for the benefit of the parties to the agreement. These representations and warranties: ● may have been qualified by disclosures that were made to the other parties in connection with the negotiation of the agreements, which disclosures are not necessarily reflected in the agreements; ● may apply standards of materiality that differ from those of a reasonable investor; and ● were made only as of specified dates contained in the agreements and are subject to subsequent developments and changed circumstances. Accordingly, these representations and warranties may not describe the actual state of affairs as of the date that these representations and warranties were made or at any other time. Investors should not rely on them as statements of fact. Exhibit Number Description 2.1 Share Exchange Agreement, dated May 20, 2014, by and among Camp Nine, Inc., Relmada Therapeutics, Inc., and the stockholders of Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 2.1 of Relmada’s Form 8-K filed with the SEC on May 27, 2014). 3.1 (i) Articles of Incorporation of Camp Nine, Inc. (incorporated by reference to Exhibit 3.1 of Relmada’s Registration Statement on Form S-1 filed with the SEC on November 13, 2012). (ii) Certificate of Designation dated May 13, 2014 (incorporated by reference to Exhibit 4.1 to Relmada’s Report on Form 8-K filed with the SEC on May 19, 2014). (iii) Nevada Certificate of Amendment to Articles of Incorporation of Camp Nine, Inc., effective May 30, 2014 (incorporated by reference to Exhibit 3.1 of Relmada’s Form 8-K filed with the SEC on June 2, 2014). (iv) Nevada Certificate of Amendment to Articles of Incorporation of Camp Nine, Inc., effective July 8, 2014 (incorporated by reference to Exhibit 3.1 of Relmada’s Form 8-K filed with the SEC on July 14, 2014). (v) Certificate of Change of Relmada Therapeutics, Inc. dated September 26, 2019 (incorporated by reference to Exhibit 3.1 of Relmada’s Form 8-K filed with the SEC on September 27, 2019). (vi) Certificate of Amendment to Articles of Incorporation dated September 22, 2022 (incorporated by reference to Exhibit 3.1 of Relmada’s Form 8-K filed with the SEC on September 22, 2022). 3.2 Second Amended and Restated Bylaws of Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 3.2 of Relmada’s Form 8-K filed with the SEC on November 25, 2015). 45 Exhibit Number Description 4.1 Form of Warrants to Purchase Common Stock issued in 2012 and 2013 in connection with Relmada Therapeutics, Inc. Series A Preferred Stock (incorporated by reference to Exhibit 4.1 of Relmada’s Form 8-K filed with the SEC on May 27, 2014). 4.2 Form of Warrants to Purchase Common Stock issued in 2012 and 2013 in connection with Relmada Therapeutics, Inc. 8% Senior Subordinated Promissory Notes (incorporated by reference to Exhibit 4.2 of Relmada’s Form 8-K filed with the SEC on May 27, 2014). 4.3 Form of B Warrant dated May __, 2014 issued to investors by Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 4.4 of Relmada’s Form 8-K filed with the SEC on May 27, 2014). 4.4 Form of B Warrant dated June 10, 2014 issued to investors by Camp Nine, Inc. (incorporated by reference to Exhibit 4.2 of Relmada’s Form 8-K filed with the SEC on June 16, 2014). 4.5 Form of Convertible Promissory Note (incorporated by reference to Exhibit 4.1 of Relmada’s Form 10-Q filed with the SEC on February 12, 2018). 4.6 Form of Warrant to Purchase Common Stock (incorporated by reference to Exhibit 4.2 of Relmada’s Form 10-Q filed with the SEC on February 12, 2018). 4.7 Form of 2018 Warrant (incorporated by reference to Exhibit 4.1 of Relmada’s Form 10-Q filed with the SEC on November 13, 2018). 4.8 Form of 2019 Warrant (incorporated by reference to Exhibit 4.1 of Relmada’s Form 10-Q filed with the SEC on May 15, 2019). 4.9 Form of Exchanged Warrant [(incorporated by reference to Exhibit 4.1 of Relmada’s Form 8-K filed with the SEC on September 22, 2022).] 4.10 Description of Securities (incorporated by reference to the description of the Company’s common stock, par value $0.001 per share, under the heading “Description of Securities We May Offer—Authorized Capital Stock; Issued and Outstanding Capital Stock,” “—Common Stock,” “—Forum for Adjudication of Disputes, “—Anti-takeover Effects of Our Articles of Incorporation and By-laws, and “—Anti-takeover Effects of Nevada Law” in the Company’s Registration Statement on Form S-3 (File No. 333-245054), filed with the Securities and Exchange Commission on August 12, 2020) 10.1 Agreement and Plan of Merger dated as of December 31, 2013 between Relmada Therapeutics, Inc. and Medeor, Inc. (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on May 27, 2014). 10.2 2014 Stock Option and Equity Incentive Plan (incorporated by reference to Exhibit 10.14 of Relmada’s Form S-1/A filed with the SEC on December 9, 2014) 10.3 Director Agreement, dated July 14, 2015, by and between Charles J. Casamento and Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on July 16, 2015) 10.4 Director Indemnity Agreement, dated July 14, 2015, by and between Charles J. Casamento and Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 10.2 of Relmada’s Form 8-K filed with the SEC on July 16, 2015) 10.5 Amended 2014 Stock Option and Equity Incentive Plan (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on August 7, 2015). 10.6 Form of Indemnification Agreement (incorporated by reference to Exhibit 10.2 of Relmada’s Form 8-K filed with the SEC on August 7, 2015). 46 Exhibit Number Description 10.7 License Agreement, dated January 16, 2018, between Relmada Therapeutics, Inc. Dr. Charles E. Inturrisi and Dr. Paolo Manfredi (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on January 19, 2018). 10.8 Intellectual Property Assignment Agreement, dated January 16, 2018, between Relmada Therapeutics, Inc. Dr. Charles E. Inturrisi and Dr. Paolo Manfredi (incorporated by reference to Exhibit 10.2 of Relmada’s Form 8-K filed with the SEC on January 19, 2018). 10.9 Form of Note and Warrant Purchase Agreement (incorporated by reference to Exhibit 10.1 of Relmada’s Form 10-Q filed with the SEC on February 12, 2018). 10.10 Third Amendment to the 2014 Stock Option and Equity Incentive Plan, as amended (incorporated by reference to Exhibit 10.3 of Relmada’s Form 10-Q filed with the SEC on May 14, 2018). 10.11 Form of Unit Purchase Agreement among Relmada Therapeutics, Inc. and certain accredited investors (incorporated by reference to Exhibit 10.1 of Relmada’s Form 10-Q filed with the SEC on November 13, 2018). 10.12 Amendment No. 4 to the Relmada Therapeutics, Inc. 2014 Stock Option and Equity Incentive Plan, as amended (incorporated by reference to Exhibit 10.1 of Relmada’s Form 10-Q filed with the SEC on May 15, 2019). 10.13 Form of Share Purchase Agreement, dated September 23, 2019 and September 26, 2019, among Relmada Therapeutics, Inc. and certain accredited investors named therein (incorporated by reference to Exhibit 10.4 of Relmada’s Form 10-Q filed with the SEC on November 13, 2019). 10.14 Form of Registration Rights Agreement, dated September 23, 2019 and September 26, 2019, among Relmada Therapeutics, Inc. and certain accredited investors named therein (incorporated by reference to Exhibit 10.5 of Relmada’s Form 10-Q filed with the SEC on November 13, 2019). 10.15 Amended and Restated Unit Purchase Agreement dated November 27, 2019, between Relmada Therapeutics, Inc., and certain accredited investors (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on December 3, 2019). 10.16 Amendment No. 1 To License Agreement dated December 2, 2019, to the License Agreement dated January 16, 2018 between Relmada Therapeutics, Inc., and Dr. Charles E. Inturrisi and Dr. Paolo Manfredi (incorporated by reference to Exhibit 10.2 of Relmada’s Form 8-K filed with the SEC on December 3, 2019). 10.17 Director Agreement, effective December 19, 2019, by and between Eric Schmidt and Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on December 26, 2019). 10.18 Indemnity Agreement, effective December 19, 2019, by and between Eric Schmidt and Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 10.2 of Relmada’s Form 8-K filed with the SEC on December 26, 2019). 10.19 Director Agreement, effective December 19, 2019, by and between John Glasspool and Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 10.3 of Relmada’s Form 8-K filed with the SEC on December 26, 2019). 47 Exhibit Number Description 10.20 Indemnity Agreement, effective December 19, 2019, by and between John Glasspool and Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 10.4 of Relmada’s Form 8-K filed with the SEC on December 26, 2019). 10.21 Employment Agreement, dated January 9, 2020, by and between Maged Shenouda and Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on January 10, 2020). 10.22 Employment Agreement, dated January 9, 2020, by and between Charles Ence and Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 10.2 of Relmada’s Form 8-K filed with the SEC on January 10, 2020). 10.23 Amended and Restated Employment Agreement, dated January 9, 2020, by and between Sergio Traversa and Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 10.3 of Relmada’s Form 8-K filed with the SEC on January 10, 2020). 10.24 Amendment No. 5 to Stock Option and Equity incentive Plan (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on March 9, 2020). 10.25 Open Market Sale Agreement SM dated as of May 15, 2020 by and between Relmada Therapeutics, Inc. and Jefferies LLC. (incorporated by reference to Exhibit 10.7 of Relmada’s Form 10-Q filed with the SEC on May 15, 2020). 10.26 Relmada Therapeutics, Inc., 2021 Equity Incentive Plan (incorporated by reference to Exhibit 10.61 of Relmada’s Form 10-K filed with the SEC on March 24, 2021). 10.27 License Agreement dated as of July 16, 2021, between Arbormentis, LLC and Relmada Therapeutics, Inc. (incorporated by reference to Exhibit 10.2 of Relmada’s Form 10-Q filed with the SEC on August 10, 2021). 10.28 Exchange Agreement between Relmada Therapeutics, Inc., and Venrock Healthcare Capital Partners EG, L.P., Venrock Healthcare Capital Partners II, L.P., VHCP Co-Investment Holdings II, LLC, Venrock Healthcare Capital Partners III, L.P., and VHCP Co-Investment Holdings III, LLC, dated September 21, 2022 (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on September 22, 2022). 48 Exhibit Number Description 10.29 Amendment No. 2 dated December 27, 2022, to the License Agreement originally dated January 16, 2018, as heretofore amended, between Relmada Therapeutics, Inc., and Dr. Charles E. Inturrisi and Dr. Paolo Manfredi (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on December 28, 2022). 10.30 Advisory Agreement dated as of January 1, 2023, between Relmada Therapeutics, Inc., and Paul Kelly (incorporated by reference to Exhibit 10.1 of Relmada’s Form 8-K filed with the SEC on January 5, 2023). 10.31 Director Agreement between Relmada Therapeutics, Inc., and Fabiana Fedeli (incorporated by reference to Exhibit 99.1 of Relmada’s Form 8-K filed with the SEC on January 17, 2023). 10.32 Indemnity Agreement between Relmada Therapeutics, Inc., and Fabiana Fedeli (incorporated by reference to Exhibit 99.2 of Relmada’s Form 8-K filed with the SEC on January 17, 2023). 21.1 List of Subsidiaries (incorporated by reference to Exhibit 21.1 of Relmada’s Form 10-K filed with the SEC on September 9, 2014). 23.1 Consent of Marcum LLP 31.1* Certification of Principal Executive Officer, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2* Certification of Principal Financial and Accounting Officer, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1† Certification of 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 Principal Financial and Accounting Officer, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 101.INS* Inline XBRL Instance Document. 101.SCH* Inline XBRL Taxonomy Extension Schema Document. 101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document. 101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document. 101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document. 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document. 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). * Filed herewith † Furnished herewith 49 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following person on behalf of the Registrant. Dated: March 19, 2024 RELMADA THERAPEUTICS, INC. By: /s/ Sergio Traversa Sergio Traversa Chief Executive Officer (Duly Authorized Officer and Principal Executive Officer) By: /s/ Maged Shenouda Maged Shenouda Chief Financial Officer (Duly Authorized Officer and (Principal Financial and Accounting Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following person on behalf of the Registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Sergio Traversa Chief Executive Officer, and Director March 19, 2024 Sergio Traversa /s/ Maged Shenouda Chief Financial Officer March 19, 2024 Maged Shenouda /s/ Charles J. Casamento Chairman of the Board March 19, 2024 Charles J. Casamento /s/ Paul Kelly Director March 19, 2024 Paul Kelly /s/ John Glasspool Director March 19, 2024 John Glasspool /s/ Fabiana Fedeli Director March 19, 2024 Fabiana Fedeli 50