10-K/A
Hepion Pharmaceuticals, Inc. (HEPA)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K/A
| (Mark One) | |
|---|---|
| ☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Forthe year ended December 31, 2023
Or
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|---|
| For the transition period from to |
Commission
File Number 001-36856
HEPION
PHARMACEUTICALS, INC.
(Exact Name of Registrant as Specified in Its Charter)
| Delaware | 46-2783806 |
|---|---|
| (State<br> or Other Jurisdiction of<br><br> <br>Incorporation<br> or Organization) | (I.R.S.<br> Employer<br><br> <br>Identification<br> No.) |
| 399 Thornall Street, First Floor Edison, New Jersey | 08837 |
| --- | --- |
| (Address<br> of Principal Executive Offices) | (Zip<br> Code) |
Registrant’s telephone number, including area code: (732) 902-4000
Securities
registered pursuant to Section 12(b) of the Act:
| Title of each class | Name of each exchange on which registered |
|---|---|
| Common<br> Stock, par value $0.0001 per share | The<br> Nasdaq Capital Market |
Securities
registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☒
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.:
| Large<br> accelerated filer ☐ | Accelerated<br> filer ☐ | Non-accelerated<br> filer ☒ | Smaller<br> reporting company ☒ | Emerging<br> growth company ☐ |
|---|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As
of June 30, 2023 (the last business day of the registrant’s most recently completed second fiscal quarter), the aggregate market value of the registrant’s voting stock held by non-affiliates was approximately $40.3 million based on the last reported sale price of the registrant’s common stock.
The
number of shares of the registrant’s Common Stock outstanding as of March 13, 2024 was 5,472,451.
Documents
Incorporated by Reference:
None.
| Audit Firm ID | Auditor Name | Auditor Location |
|---|---|---|
| 606 | GRASSI<br> & CO., CPAs, P.C. | Jericho,<br> New York |
EXPLANATORY
NOTE
The purpose of this Amendment No. 1 on Form 10-K/A (the “Amendment”) is to amend and restate Part III, Items 10 through 14, of the previously filed Annual Report on Form 10-K of Hepion Pharmaceuticals, Inc. (the “Company”) for the year ended December 31, 2023, filed with the Securities and Exchange Commission (the “SEC”) on April16, 2024 (the “Original Form 10-K”), to include information previously omitted in reliance on General Instruction G to Form 10-K, which provides that registrants may incorporate by reference certain information from a definitive proxy statement prepared in connection with the election of directors. The Company has determined to include such Part III information by amendment of the Original Form 10-K rather than incorporation by reference to the proxy statement. Accordingly, Part III of the Original Form 10-K is hereby amended and restated as set forth below.
As a result of this Amendment, the Company is also filing the certifications required under Section 302 of the Sarbanes-Oxley Act of 2002 as exhibits to this Amendment.
Except as described above, no other changes have been made to the Original Form 10-K. Among other things, forward-looking statements made in the Original Form 10-K have not been revised to reflect events that occurred or facts that became known to us after the filing of the Original Form 10-K, and such forward-looking statements should be read in their historical context.
TABLE
OF CONTENTS
| Page | ||
|---|---|---|
| PART III | ||
| Item<br> 10. | Directors, Executive Officers and Corporate Governance | 3 |
| Item<br> 11. | Executive Compensation | 7 |
| Item<br> 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 9 |
| Item<br> 13. | Certain Relationships and Related Transactions, and Director Independence | 9 |
| Item<br> 14. | Principal Accounting Fees and Services | 9 |
| PART IV | ||
| Item<br> 15. | Exhibits and Financial Statement Schedules | 10 |
| SIGNATURES | 12 |
| 2 |
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PART
III
| Item 10. | Directors, Executive Officers and Corporate Governance. |
|---|
ExecutiveOfficers and Directors
Set forth below is certain information with respect to the individuals who are our directors and executive officers as of June 20, 2024:
| Name | Age | Position(s) |
|---|---|---|
| John<br> Cavan | 65 | Interim Chief Executive Officer and Chief Financial Officer |
| John<br> P. Brancaccio | 76 | Executive Chairman |
| Timothy<br> Block, Ph.D. | 68 | Director |
| Kaouthar<br> Lbiati, M.D. | 45 | Director |
| Michael<br> Purcell | 67 | Director |
JohnCavan has been our interim Chief Executive Officer since December 2023 and Chief Financial Officer since March 2016. Previously, Mr. Cavan was a consultant with The Pine Hill Group where he was instrumental in completing several financial transactions, including initial public offerings, business combinations and strategic transactions. Prior to his role with the Pine Hill Group, he served as Chief Accounting Officer at Stemline Therapeutics, Inc. Preceding his role at Stemline, Mr. Cavan was Vice President and Chief Accounting Officer at Aegerion Pharmaceuticals, Inc. He has also held financial positions within the healthcare industry at AlgoRx Pharmaceuticals, Inc. and Alpharma. Mr. Cavan served in a variety of financial and operational positions early in his career during tenures with large multinational public companies, including Sony, American Express, International Specialty Products (an Ashland Company) and Nestlé U.S.A. Mr. Cavan currently serves on the Board of Directors of Vantage Health Systems. He holds a B.B.A in Accountancy from Iona College and an M.B.A. in Finance from Seton Hall University.
JohnP. Brancaccio, a retired CPA, has served as Executive Chairman since March 2024 and a director of our Company since May 15, 2013. Mr. Brancaccio was the Chief Financial Officer of Accelerated Technologies, Inc., an incubator for medical device companies from April 2004 until May 2017. Mr. Brancaccio served as a director for Callisto Pharmaceuticals, Inc. from April 2004 until its merger with Synergy Pharmaceuticals, Inc. in January 2013 and was formerly a director of Tamir Biotechnology, Inc. (formerly Alfacell Corporation) since April 2004 until May 2020. He is also a director of Rasna Therapeutics, Inc. since September 2016, OKYO Pharma Limited since June 2020 and Tiziana Life Sciences plc since July 2020. Mr. Brancaccio’s chief financial officer experience provides him with valuable financial and accounting expertise which the Board believes qualifies him to serve as a director of our Company.
Dr.Timothy Block has served as a director of our Company since November 26, 2013. Dr. Block is Professor of Microbiology and Immunology, Drexel University College of Medicine and Director of its Drexel Institute for Biotechnology and Virology Research, and is also the Co-founder and President of the Hepatitis B Foundation (HBF) and its Baruch S. Blumberg Institute (formerly called the Institute for Hepatitis and Virus Research). Dr. Block is also President and CEO of the Pennsylvania Biotechnology Center. Dr. Block has been a member of medical school faculties as a professional researcher for more than 28 years, publishing more than 180 papers, 12 U.S. patents, and since 2006, has led or “co-led” more than $50 million in research funding. Honors include an honorary Medical Doctorate (Bulgarian Academy of Medicine); the Lifetime Achievement Award from the Centrals Bucks Chamber of Commerce; named one of the regions 100 Most Outstanding People of the Century by the Daily Intelligencer; Distinguished Service Recognition from the National Cancer Institute’s Early Detection Research Network; and a Special Citation from the U.S. House of Representatives in recognition of “outstanding achievements.” Dr. Block has given frequent testimony to the U.S. Congress and State legislatures; has served on U.S. FDA and numerous NIH panels as well as commercial boards including the Bristol Myers Squibb Entecavir Advisory Board. In 2009, Dr. Block was named an elected Fellow of the American Association for the Advancement of Science (AAAS). Dr. Block’s experience and expertise in the medical field with respect to Hepatitis B qualifies him to serve as a director of our Company.
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KaoutharLbiati, M.D. has served as a director of our Company since June 2022. Dr. Lbiati is an experienced business leader focusing on value creation, value-inflection milestones and portfolio growth. Since November 2017, Dr Lbiati has been helping early and late stage immune-oncology biotech companies such as, Cytovia Therapeutics, Steba Biotech and Immune Pharmaceuticals, better define their corporate strategy, optimize technology platforms, prioritize their pipeline and portfolio, effectively pitching their value proposition to investors and partners in order to secure funding and deals. Within Cytovia Therapeutics ; a biopharmaceutical company specializing in NK cell therapies, Dr Lbiati held non-executive and executive roles. She started as Advisor to the CEO in May 2020 for (3) months then, Vice President Product Strategy until July 2021 and Vice President, Strategy & Corporate Development until November 2022. Previously, Dr. Lbiati served, for over a decade, in global and regional leadership roles at Amgen, Glaxo Smith Kline, and Sanofi, where she supported the registration, launch and/or indication extension and reimbursement of several innovative cancer drugs such as – Blincyto®, Jevtana® and Votrient® – in the U.S., EU and MENA regions, with a focus on medical affairs; strategic planning, health economics and outcomes research; and market access across multiple countries. Dr. Lbiati received a Doctor of Medicine degree from Rabat, Morocco’s Mohammed V University, a fellowship in oncology from the Gustave Roussy Institute in Paris, a Specialized Executive Master’s degree in Strategy & Management from ESSEC Business School in Paris, and a Master of Science in International Policy and Health Economics from the London School of Economics. In 2022, she was certified from Columbia Business School in Corporate Governance and from Harvard Business School in finance. Dr. Lbiati’s experience at biopharmaceutical and biotechnology companies and background qualifies her to be a director of our Company.
MichaelPurcell has served as a director of our company since March 2024. Mr. Purcell is a certified public accountant and became an independent business consultant following retirement in 2015. Mr. Purcell spent more than 36 years with Deloitte & Touche LLP (“Deloitte”), where he was an audit partner and the Philadelphia office leader of Deloitte’s middle-market and growth enterprise services. Mr. Purcell has served on the boards of directors of numerous companies and organizations, and currently serves as lead independent director of International Money Express, Inc. Mr. Purcell also serves as a director and a member of the audit committee for each of CFG Bank and Hyperion Bank and as a director of several other for-profit and non-profit entities. Mr. Purcell formerly served as chairman of the board, director and chair of the audit committee of publicly traded Tabula Rasa HealthCare, Inc. from 2018 until 2023. He is a member of the American Institute of Certified Public Accountants and a former President of the Philadelphia Chapter of the Pennsylvania Institute of Certified Public Accountants. Mr. Purcell holds a bachelor’s degree from Lehigh University and a master’s degree in business administration from Drexel University. We believe that Mr. Purcell’s extensive public accounting experience coupled with his experience serving on boards of directors make him well qualified to serve as a director.
FamilyRelationships and Other Arrangements
There are no family relationships among our directors and executive officers. There are no arrangements or understandings between or among our executive officers and directors pursuant to which any director or executive officer was or is to be selected as a director or executive officer.
BoardLeadership Structure and Role in Risk Oversight
Risk is inherent with every business, and how well a business manages risk can ultimately determine its success. Management is responsible for the day-to-day management of the risks we face, while the Board, as a whole and through its committees, has responsibility for the oversight of risk management. In its risk oversight role, the Board is responsible for satisfying itself that the risk management processes designed and implemented by management are adequate and functioning as designed.
The Board believes that establishing the right “tone at the top” and that full and open communication between executive management and the Board are essential for effective risk management and oversight. Our CEO communicates frequently with members of the Board to discuss strategy and challenges facing our company. Senior management usually attends our regular quarterly Board meetings and is available to address any questions or concerns raised by the Board on risk management-related and any other matters. Each quarter, the Board receives presentations from senior management on matters involving our key areas of operations.
DirectorIndependence
Our Board has determined that a majority of the Board consists of members who are currently “independent” as that term is defined under Nasdaq Listing Rule 5605(a)(2). The Board considers Drs. Bloc and Lbiati and Mr. Purcell to be “independent.”
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Boardof Directors Meetings
During the year ended December 31, 2023, our Board met 10 times, including telephonic meetings, the Audit Committee met 5 times, the Compensation Committee met 5 times and the Corporate Governance/Nominating Committee met 2 times. All directors attended 75% or more of the aggregate number of meetings of the Board, all of the Audit Committee members attended 75% or more of the Audit Committee meetings, all of the Compensation Committee members attended 75% or more of the Compensation Committee meeting, and all of the Corporate Governance/Nominating Committee members attended 75% or more of the Corporate Governance/Nominating Committee meeting.
InformationRegarding Board Committees
Our Board has established standing Audit, Compensation and Corporate Governance/Nominating Committees to devote attention to specific subjects and to assist it in the discharge of its responsibilities. All committees operate under a written charter adopted by our Board, each of which is available on our Internet website at www.hepionpharma.com/investors/governance.
AuditCommittee
The Audit Committee’s responsibilities include: (i) reviewing the independence, qualifications, services, fees, and performance of the independent registered public accountants, (ii) appointing, replacing and discharging the independent registered public accounting firm, (iii) pre-approving the professional services provided by the independent registered public accounting firm, (iv) reviewing the scope of the annual audit and reports and recommendations submitted by the independent registered public accounting firm, and (v) reviewing our financial reporting and accounting policies, including any significant changes, with management and the independent registered public accounting firm. The Audit Committee also prepares the Audit Committee report that is required pursuant to the rules of the SEC.
The Audit Committee currently consists of Mr. Purcell, chairman, Dr. Block and Dr. Lbiati. We believe that each of Mr. Purcell, Dr. Block and Dr. Lbiati is “independent” as that term is defined under applicable SEC and Nasdaq rules. Mr. Purcell is our audit committee financial expert. The Board has adopted a written charter setting forth the authority and responsibilities of the Audit Committee. The charter is available on our website at www.hepionpharma.com.
CompensationCommittee
The Compensation Committee has responsibility for assisting the Board in, among other things, (i) evaluating and making recommendations regarding the compensation of the executive officers and directors of our company, (ii) assuring that the executive officers are compensated effectively in a manner consistent with our stated compensation strategy, (iii) producing an annual report on executive compensation in accordance with the rules and regulations promulgated by the SEC, (iv) periodically evaluating the terms and administration of our incentive plans and benefit programs and (v) monitoring of compliance with the legal prohibition on loans to our directors and executive officers.
The Compensation Committee currently consists of Mr. Purcell, Dr. Block and Dr. Lbiati. We believe that all of the members are “independent” under the current listing standards of Nasdaq. The Board has adopted a written charter setting forth the authority and responsibilities of the Compensation Committee which is available on our website at www.hepionpharma.com.
CompensationCommittee Interlocks and Insider Participation
None of the members of our compensation committee was, during the year ended December 31, 2023, an officer or employee of ours, was formerly an officer of ours or had any relationship requiring disclosure by us under Item 404 of Regulation S-K. No interlocking relationship as described in Item 407(e)(4) of Regulation S-K exists between any of our executive officers or Compensation Committee members, on the one hand, and the executive officers or compensation committee members of any other entity, on the other hand, nor has any such interlocking relationship existed in the past.
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CorporateGovernance/Nominating Committee
The Corporate Governance/Nominating Committee has responsibility for assisting the Board in, among other things, (i) effecting board organization, membership and function including identifying qualified board nominees, (ii) effecting the organization, membership and function of board committees including composition and recommendation of qualified candidates, (iii) establishment of and subsequent periodic evaluation of successor planning for the chief executive officer and other executive officers, (iv) development and evaluation of criteria for board membership such as overall qualifications, term limits, age limits and independence and (v) oversight of compliance with the Corporate Governance Guidelines. The Corporate Governance/Nominating Committee shall identify and evaluate the qualifications of all candidates for nomination for election as directors. Potential nominees are identified by the Board based on the criteria, skills and qualifications that have been recognized by the Corporate Governance/Nominating Committee. While our nomination and corporate governance policy does not prescribe specific diversity standards, the Corporate Governance/Nominating Committee and its independent members seek to identify nominees that have a variety of perspectives, professional experience, education, differences in viewpoints and skills, and personal qualities that will result in a well-rounded Board.
The Corporate Governance/Nominating Committee currently consists of Dr. Block, chairman, Dr. Lbiati and Mr. Purcell. We believe that all of the members are “independent” under the current listing standards of Nasdaq. Our Board has adopted a written charter setting forth the authority and responsibilities of the Corporate Governance/Nominating Committee which is available on our website at www.hepionpharma.com.
Communicationswith our Board of Directors
Stockholders seeking to communicate with our Board should submit their written comments to our interim Chief Executive Officer, John Cavan, at Hepion Pharmaceuticals, Inc., 399 Thornall Street, First Floor, Edison, NJ 08837. Mr. Cavan will forward such communications to each member of our Board; provided that, if in the opinion of Mr. Cavan it would be inappropriate to send a particular stockholder communication to a specific director, such communication will only be sent to the remaining directors (subject to the remaining directors concurring with such opinion).
Codeof Business Conduct and Ethics
We have adopted a Code of Business Conduct and Ethics to ensure that our business is conducted in a consistently legal and ethical manner. All of our employees, including our executive officers and directors, are required to comply with our Code of Business Conduct and Ethics.
The full text of the Code of Business Conduct and Ethics is posted on our website at http://www.hepionpharma.com/investors/governance. Any waiver of the Code of Business Conduct and Ethics for directors or executive officers must be approved by our Audit Committee. We will disclose future amendments to our Code of Business Conduct and Ethics, or waivers from our Code of Business Conduct and Ethics for our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, on our website within four business days following the date of the amendment or waiver. In addition, we will disclose any waiver from our Code of Business Conduct and Ethics for our other executive officers and our directors on our website. A copy of our Code of Business Conduct and Ethics will also be provided free of charge upon request to: Secretary, Hepion Pharmaceuticals, Inc. 399 Thornall Street, First Floor, Edison, NJ 08837.
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| Item 11. | Executive Compensation. |
|---|
SummaryCompensation Table
The following table contains compensation information for our Chief Executive Officer and certain other executives who were the most highly compensated executive officers for the years ended December 31, 2023 and 2022.
| Non-equity incentive | |||||
|---|---|---|---|---|---|
| plan | |||||
| Options | compensation () | ||||
| Name & Principal position | Year | Salary () | granted<br>() | (1) | Total () |
| Dr. Robert Foster (2) | 2023 | ||||
| Former Chief Executive Officer | 2022 | ||||
| John Cavan | 2023 | ||||
| Interim Chief Executive Officer and Chief Financial Officer | 2022 | ||||
| Dr. Todd Hobbs (3) | 2023 | ||||
| Former Chief Medical Officer | 2022 |
All values are in US Dollars.
| (1) | Represents<br> cash bonus payments earned based upon the achievement of corporate objectives established by our Compensation Committee for performance<br> during the years ended December 31, 2023 and 2022, as further described above in “Variable Annual Cash Bonus Structure and Payouts.” |
|---|---|
| (2) | Dr.<br> Foster left the Company in December 2023. |
| (3) | Dr.<br> Hobbs left the Company in August 2023. |
EmploymentAgreements
On October 4, 2019, we entered into an Executive Agreement (the “Cavan Agreement”) with John Cavan, our interim Chief Executive Officer and Chief Financial Officer. The term of the Cavan Agreement commenced on October 4, 2019 and continued until October 4, 2022, following which time the Cavan Agreement will be automatically renewed for successive one year periods at the end of each term, unless either party delivers written notice to the other party of their intent to not renew the Cavan Agreement. Pursuant to the Cavan Agreement, Mr. Cavan’s current base compensation is $400,000 per year. Mr. Cavan is eligible to receive a cash bonus of up to 40% of his base salary per year based on meeting certain performance objectives and bonus criteria.
If Mr. Cavan’s employment is terminated by us for cause or as a result of Mr. Cavan’s death or permanent disability, or if Mr. Cavan terminates the Cavan Agreement voluntarily without Good Reason (as defined in the Cavan Agreement), Mr. Cavan will be entitled to receive a lump sum equal to (i) any portion of unpaid base compensation then due for periods prior to termination, (ii) any bonus earned but not yet paid, and (iii) all business expenses reasonably and necessarily incurred by Mr. Cavan prior to the date of termination. If Mr. Cavan’s employment is terminated by us without cause or by Mr. Cavan for Good Reason, Mr. Cavan will be entitled to receive the amounts due upon termination of his employment by us for cause or as a result of his death or permanent disability, or upon termination by Mr. Cavan of his employment voluntarily with Good Reason, in addition to (provided that Mr. Cavan executes a written release with respect to certain matters) a severance payment equal to his base compensation for 9 months from the date of termination and reimburse Mr. Cavan’s payment of COBRA premiums for 9 months from the date of termination.
In addition, if Mr.Cavan’s employment is terminated:
| (a) | by<br> us without cause within 6 months prior to a change of control (as defined in the Cavan Agreement) that was pending during<br> such 6 month period, |
|---|---|
| (b) | by<br> Mr. Cavan for Good Reason within 12 months after a change of control, or (c) by us without cause at any time upon or within<br> 12 months after a change of control, Mr. Cavan would be entitled to receive the amounts due upon termination of his employment by us<br> for cause or as a result of his death or permanent disability, or upon termination by Mr. Cavan voluntarily without Good Reason,<br> provided, if Mr. Cavan executes a written release with respect to certain matters, he will be entitled to a severance payment equal<br> to his base compensation for 9 months from the date of termination and reimbursement of his payment of COBRA premiums for 6 months<br> from the date of termination. In addition, all of Mr. Cavan’s unvested stock options and other equity awards would immediately<br> vest and become fully exercisable (x) in the event a change of control transaction is pending, for a period of six months following<br> the date of termination, and (y) in the event a change of control transaction is not then pending, for the period of time set forth<br> in the applicable agreement evidencing the award. |
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OutstandingEquity Awards as of December 31, 2023
| Number of Securities | ||||||
|---|---|---|---|---|---|---|
| Underlying Unexercised | Option | Option | ||||
| Options (#) | Exercise | Expiration | ||||
| Name | Exercisable | Unexercisable | Price () | Date(1), (2) | ||
| Dr. Robert Foster | 134 | 45 | 6/10/2026 | |||
| Former Chief Executive Officer | 3,233 | 6,467 | 7/29/2029 | |||
| 126,666 | 253,334 | 4/3/2030 | ||||
| — | 212,000 | 8/19/2030 | ||||
| John Cavan | 179 | — | 4/1/2026 | |||
| Interim Chief Executive Officer and Chief Financial Officer | 34 | — | 8/26/2026 | |||
| 27 | — | 7/20/2027 | ||||
| 5,820 | — | 7/24/2029 | ||||
| 71,666 | 143,334 | 4/3/2030 | ||||
| — | 160,000 | 8/19/2030 |
All values are in US Dollars.
DirectorCompensation
During year ended December 31, 2023, our non-employee directors received the following compensation for their services on the Board and its committees:
| Name | Cash Fees | Option Awards(1) | Total | |||
|---|---|---|---|---|---|---|
| Gary S. Jacob ^(2)^ | $ | 93,938 | $ | 0 | $ | 93,938 |
| John P. Brancaccio ^(3)^ | 81,000 | 0 | 81,000 | |||
| Timothy Block ^(5)^ | 72,900 | 0 | 72,900 | |||
| Kaouthar Lbiati ^(6)^ | 80,500 | 0 | 80,500 | |||
| Anand Reddi | 79,000 | 0 | 79,000 | |||
| Petrus Wjjngaard ^(7)^ | 73,360 | 0 | 73,360 | |||
| (1) | Represents<br> the grant date fair value of the option awards granted during the fiscal years ended December 31, 2023, calculated in accordance<br> with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation – Stock Compensation. See<br> Note 3, “Stockholders’ Equity” in the notes to the Company’s consolidated financial statements for the year<br> ended December 31, 2023 included in the Company’s Annual Report on Form 10-K filed with the SEC on April 16, 2024 for more<br> information regarding the Company’s accounting for share-based compensation plans | |||||
| --- | --- | |||||
| (2) | As<br> of December 31, 2023, Dr. Gary Jacob held 4,639 option awards all of which are exercisable. | |||||
| (3) | As<br> of December 31, 2023, Mr. Brancaccio held 4,566 option awards all of which are exercisable. | |||||
| (4) | As<br> of December 31, 2023, Dr. Block held 4,563 option awards all of which are exercisable. | |||||
| (5) | As<br> of December 31, 2023, Dr. Kaouthar Lbiati 1,500 option awards all of which are exercisable. | |||||
| (6) | As<br> of December 31, 2023, Mr. Anand Reddi 1,500 option awards all of which are exercisable. | |||||
| (6) | As<br> of December 31, 2023, Dr. Petrus Wijngaard 3,000 option awards all of which are exercisable. |
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| Item 12. | Security Ownership of Certain Beneficial Owners and Managementand Related Stockholder Matters. |
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The following table sets forth certain information regarding beneficial ownership of shares of our common stock as of June 20, 2024, based on 5,473,126 shares issued and outstanding by (i) each person known to beneficially own more than 5% of our outstanding common stock, (ii) each of our directors, (iii) our executive officers and (iv) all directors and executive officers as a group. Shares are beneficially owned when an individual has voting and/or investment power over the shares or could obtain voting and/or investment power over the shares within 60 days of the Record Date. Except as otherwise indicated, the persons named in the table have sole voting and investment power with respect to all shares beneficially owned, subject to community property laws, where applicable. Unless otherwise indicated, the address of each beneficial owner listed below is c/o Hepion Pharmaceuticals, Inc., 399 Thornall Street, First Floor, Edison, New Jersey 08837.
| Beneficial Owner | Number of <br> Shares<br> Beneficially<br> Owned | Shares of <br> common stock<br> issuable upon<br> exercise of<br> stock options | Shares of common stock issuable upon exercise of<br> <br>warrants | Percentage of common stock Beneficially<br> <br>owned | |||||
|---|---|---|---|---|---|---|---|---|---|
| Directors and Executive Officers | |||||||||
| John Cavan | 746 | 18,606 | 6 | * | |||||
| Dr. Robert Foster (1) | 2,363 | 29,502 | - | * | |||||
| Dr. Todd Hobbs (2) | - | - | - | * | |||||
| Dr.Gary Jacob | 609 | 4,639 | 6 | * | |||||
| John Brancaccio | 351 | 4,566 | 1 | * | |||||
| Dr. Timothy Block | 351 | 4,563 | - | * | |||||
| Anand Reddi | - | 1,500 | - | * | |||||
| Dr. Kaouthar Lbiati | - | 1,500 | - | * | |||||
| Dr. Petrus Wijngaard | 1,501 | 3,000 | - | * | |||||
| Michael Purcell (3) | - | - | - | * | |||||
| All current executive officers and directors as a group (7 persons) | 5,570 | 67,876 | 13 | 1.3 |
* less than one percent.
(1) Dr. Foster left the Company as CEO in December 2023.
(2) Dr. Hobbs left the Company as CMO in September 2023.
(3) Mr. Purcell joined the Board in March 2024.
(3) Dr.Wijngaard left the Company as Director in December 2023.
| Item 13. | Certain Relationships, Related Person Transactions and DirectorIndependence. |
|---|
The following is a description of transactions or series of transactions since January 1, 2022 or any currently proposed transaction, to which we were or are to be a participant and in which the amount involved in the transaction or series of transactions exceeds $120,000, and in which any of our directors, executive officers or persons who we know hold more than five percent of any class of our capital stock, including their immediate family members, had or will have a direct or indirect material interest, other than compensation arrangements with our directors and executive officers.
None
| Item 14. | Principal Accountant Fees and Services. |
|---|
The aggregate fees billed to the Company by Grassi & Co., CPAs, P.C., (“Grassi”), the Company’s independent registered public accounting firm for the indicated services for fiscal year 2023 and BDO USA, LLP (“BDO”), the Company’s independent registered public accounting firm for the indicated services for fiscal year 2022, were as follows:
| 2023 | 2022 | |||
|---|---|---|---|---|
| Audit fees ^(1)^ | $ | 426,703 | $ | 409,329 |
| (1) | Audit<br> fees consist of fees for professional services performed by Grassi and BDO for the audits and reviews of our 2023 and 2022 financial<br> statements, respectively, preparation and filing of our registration statements, including issuance of comfort letters. | |||
| --- | --- |
Policyon Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors
Consistent with SEC policies and guidelines regarding audit independence, the Audit Committee is responsible for the pre-approval of all audit and permissible non-audit services provided by our independent registered public accounting firm on a case-by-case basis. Our Audit Committee has established a policy regarding approval of all audit and permissible non-audit services provided by our principal accountants. Our Audit Committee pre-approves these services by category and service. Our Audit Committee has pre-approved all of the services provided by our independent registered public accounting firm.
| 9 |
| --- |
PART
IV
| ITEM 15. | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES |
|---|
| (a)(1) | Financial Statements |
|---|
Reference is made to the Index to Consolidated Financial Statements of Hepion Pharmaceuticals, Inc. appearing on page 56 of this report.
| (a)(2) | Financial Statement Schedules |
|---|
The schedules required to be filed by this item have been omitted because of the absence of conditions under which they are required, or because the required information is included in the consolidated financial statements or the notes thereto.
| 10 |
| --- | | 4.1 | Form of Warrant issued in April Offering (incorporated by reference to Exhibit 4.1 to Form S-1 filed on April 18, 2019). | | --- | --- | | 4.2 | Form of Warrant issued in June Offering (incorporated by reference to Exhibit 4.1 to Form S-1 filed on June 5, 2019). | | 4.3 | Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (filed with the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2020 and incorporated herein by reference) | | 4.4 | Form of Series A Warrant (incorporated by reference to Exhibit 4.2 to Form 8-K filed on October 3, 2023). | | 4.5 | Form of Series B Warrant (incorporated by reference to Exhibit 4.3 to Form 8-K filed on October 3, 2023). | | 4.6 | Form of Series B-1 Warrant (incorporated by reference to Exhibit 4.1 to Form 8-K filed on February 16, 2024). | | 4.7 | Form of Series B-2 Warrant (incorporated by reference to Exhibit 4.2 to Form 8-K filed on February 16, 2024). | | 4.8 | Form of Amendment No. 1 to Series A Warrant (incorporated by reference to Exhibit 10.2 to Form 8-K filed on February 16, 2024). | | 10.1 | 10/1/2023 Omnibus Equity Incentive Plan (incorporated by reference to Appendix A to the Company’s Definitive Proxy Statement filed on April 28, 2023). | | 10.2 | Form of Securities Purchase Agreement (incorporated by reference to exhibit 10.1 to Form 8-K filed on October 3, 2023). | | 10.3 | Form of Warrant Inducement Agreement (incorporated by reference to Exhibit 10.1 to Form 8-K filed on February 16, 2024). | | 14.1 | Code of Business Conduct and Ethics (filed as Exhibit 14.1 to the Company’s Transition Report on Form 10-KT filed with the Securities and Exchange Commission on March 26, 2018 and incorporated herein by reference) | | 21.** | List of Subsidiaries. | | 23.1** | Consent of BDO USA, LLP, Independent Registered Public Accounting Firm. | | 23.2** | Consent of Grassi & Co., CPAs, P.C., Independent Registered Public Accounting Firm. | | 24** | Power of Attorney. | | 31.1* | Certification of Chief Executive Officer required under Rule 13a-14(a)/15d-14(a) under the Exchange Act. | | 31.2* | Certification of Principal Financial Officer required under Rule 13a-14(a)/15d-14(a) under the Exchange Act. | | 32.1* | Certification of Chief 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 Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | | 97.1** | Clawback Policy. | | 101.INS** | XBRL<br> Instance Document | | 101.SCH** | XBRL<br> Taxonomy Extension Schema | | 101.CAL** | XBRL<br> Taxonomy Extension Calculation Linkbase | | 101.DEF** | XBRL<br> Taxonomy Extension Definition Linkbase | | 101.LAB** | XBRL<br> Taxonomy Label Linkbase | | 101.PRE** | XBRL<br> Taxonomy Extension Presentation Linkbase |
* Filed herewith.
** Previously filed.
| 11 |
| --- |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K/A has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Date: June 24, 2024
| HEPION PHARMACEUTICALS, INC. | |
|---|---|
| By: | /s/ John Cavan |
| John<br> Cavan | |
| Interim Chief Executive Officer and Chief Financial Officer<br><br> (Principal Executive Officer and Principal Financial and Accounting Officer) |
Pursuant to the requirements of the Securities Act, this Annual Report on Form 10-K/A has been signed by the following persons in the capacities and on the dates indicated.
| Signature | Title | Date |
|---|---|---|
| /s/ John Cavan | Interim<br> Chief Executive Officer and Chief Financial Officer | June<br> 24, 2024 |
| John<br> Cavan | (Principal<br> Executive Officer and Principal Financial and Accounting Officer) | |
| * | Executive<br> Chairman | June<br> 24, 2024 |
| John<br> Brancaccio | ||
| * | Director | June<br> 24, 2024 |
| Timothy<br> Block | ||
| * | Director | June<br> 24, 2024 |
| Kaouthar<br> Lbiati | ||
| *By: | /s/ John Cavan | |
| --- | --- | |
| John<br> Cavan, Attorney-in-Fact |
| 12 |
| --- |
Exhibit31.1
Certificationof Principal Executive Officer of Hepion Pharmaceuticals, Inc.
Pursuantto Section 302 of the Sarbanes-Oxley Act of 2002
I, John Cavan, certify that:
| 1. | I<br> have reviewed this Annual Report on Form 10-K/A of Hepion Pharmaceuticals, Inc.; |
|---|---|
| 2. | Based<br> on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary<br> to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to<br> the period covered by this report; |
| 3. | Based<br> on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material<br> respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in<br> this report; |
| 4. | The<br> registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures<br> (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: |
| a. | Designed<br> such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,<br> to ensure that material information relating to the registrant is made known to us by others within those entities, particularly<br> during the period in which this report is being prepared; |
| b. | Designed<br> such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my<br> supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements<br> for external purposes in accordance with generally accepted accounting principles; |
| c. | Evaluated<br> the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about<br> the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;<br> and |
| d. | Disclosed<br> in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s<br> most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected,<br> or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The<br> registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial<br> reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing<br> the equivalent functions): |
| a. | All<br> significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are<br> reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information;<br> and |
| b. | Any<br> fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s<br> internal control over financial reporting. |
| Date:<br> June 24, 2024 | |
| --- | --- |
| /s/ JOHN CAVAN | |
| John<br> Cavan | |
| Interim Chief Executive Officer | |
| (Principal Executive Officer) |
Exhibit31.2
Certificationof Principal Financial Officer of Hepion Pharmaceuticals, Inc.
Pursuantto Section 302 of the Sarbanes-Oxley Act of 2002
I, John Cavan, certify that:
| 1. | I<br> have reviewed this Annual Report on Form 10-K/A of Hepion Pharmaceuticals, Inc.; |
|---|---|
| 2. | Based<br> on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary<br> to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to<br> the period covered by this report; |
| 3. | Based<br> on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material<br> respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in<br> this report; |
| 4. | The<br> registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures<br> (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: |
| a. | Designed<br> such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,<br> to ensure that material information relating to the registrant is made known to us by others within those entities, particularly<br> during the period in which this report is being prepared; |
| b. | Designed<br> such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my<br> supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements<br> for external purposes in accordance with generally accepted accounting principles; |
| c. | Evaluated<br> the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about<br> the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;<br> and |
| d. | Disclosed<br> in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s<br> most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected,<br> or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The<br> registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial<br> reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing<br> the equivalent functions): |
| a. | All<br> significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are<br> reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information;<br> and |
| b. | Any<br> fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s<br> internal control over financial reporting. |
| Date:<br> June 24, 2024 | |
| --- | --- |
| /s/ John Cavan | |
| John<br> Cavan | |
| Chief Financial Officer | |
| (Principal Financial Officer) |
Exhibit32.1
CertificationOf
PrincipalExecutive Officer
PursuantTo 18 U.S.C. Section 1350,
AsAdopted Pursuant To
Section906 Of The Sarbanes-Oxley Act Of 2002
In connection with the Annual Report of Hepion Pharmaceuticals, Inc. (the “Company”) on Form 10-K/A for the year ended December 31, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John Cavan, Interim Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
| 1) | The Report fully complies<br> with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
|---|---|
| 2) | The information contained in the Report fairly presents, in<br>all material respects, the financial condition of the Company at the end of the period covered by the Report and results of operations<br>of the Company for the period covered by the Report. |
| Date:<br> June 24, 2024 | |
| --- | --- |
| /s/ JOHN CAVAN | |
| John<br> Cavan | |
| Interim Chief Executive Officer | |
| (Principal Executive Officer) |
Exhibit32.2
CertificationOf
PrincipalFinancial Officer
PursuantTo 18 U.S.C. Section 1350,
AsAdopted Pursuant To
Section906 Of The Sarbanes-Oxley Act Of 2002
In connection with the Annual Report of Hepion Pharmaceuticals, Inc. (the “Company”) on Form 10-K/A for the year ended December 31, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John Cavan, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
| 1) | The Report fully complies with the requirements of Section<br>13(a) or 15(d) of the Securities Exchange Act of 1934; and |
|---|---|
| 2) | The information contained in the Report fairly presents, in<br>all material respects, the financial condition of the Company at the end of the period covered by the Report and results of operations<br>of the Company for the period covered by the Report. |
| Date:<br> June 24, 2024 | |
| --- | --- |
| /s/ John Cavan | |
| John<br> Cavan | |
| Chief Financial Officer | |
| (Principal Financial Officer) |