TAO Synergies Inc 10-Q for FY2024 Q2

TAO Synergies Inc. (TAOX)

10-Q 2024-08-14 For: 2024-06-30

Added on April 07, 2026

About this 10-Q

TAO Synergies Inc filed this 10-Q on August 14, 2024, covering the quarter ended June 30, 2024 (FY2024 Q2).

Headline figures

Quarter ended June 30, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Net loss: $1.27M; compared with a net loss of $4.09M a year earlier

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Delaware	46-1585656
(State or other jurisdiction of incorporation or	(I.R.S. Employer
organization)	Identification No.)

1185 Avenue of the Americas, 3rd Floor
New York, New York	10036
(Address of principal executive offices)	(Zip code)

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒


	Page
Part I – FINANCIAL INFORMATION	3

Item 1. Financial Statements (Unaudited)	3

Condensed Balance Sheets as of June 30, 2024 and December 31, 2023	3

Condensed Statements of Comprehensive Loss for the three and six months ended June 30, 2024 and 2023	4

Condensed Statements of Changes in Stockholders’ Equity for the three and six months ended June 30, 2024 and 2023	5

Condensed Statements of Cash Flows for the six months ended June 30, 2024 and 2023	7

Notes to Condensed Financial Statements	8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	25

Item 3. Quantitative and Qualitative Disclosures about Market Risk	32

Item 4. Controls and Procedures	32

Part II – OTHER INFORMATION	34

Item 1. Legal Proceedings	34

Item 1A. Risk Factors	34

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	34

Item 3. Defaults upon Senior Securities	34

Item 4. Mine Safety Disclosures	34

Item 5. Other Information	34

Item 6. Exhibits	35

Signatures	36


	June 30,		December 31,
	2024		2023
ASSETS

CURRENT ASSETS
Cash and cash equivalents	$	24,976,423	$	28,661,498
Prepaid Clinical trial expenses		—		375,085
Available for sale debt security		2,437,900		1,438,500
Prepaid expenses and other current assets		411,150		57,677

TOTAL CURRENT ASSETS		27,825,473		30,532,760

Equity method investment		543,952		562,402

Fixed assets, net of accumulated depreciation		15,789		18,505

TOTAL ASSETS	$	28,385,214	$	31,113,667


LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES
Accounts payable	$	475,330	$	444,633
Accrued expenses		47,521		435,891
Accrued Series B Convertible Preferred payments payable		8,829,761		3,395,945

TOTAL CURRENT LIABILITIES		9,352,612		4,276,469

Warrant liability		236,000		140,000
Derivative liability		—		1,113,000

TOTAL LIABILITIES		9,588,612		5,529,469

Commitments and contingencies

Series B Convertible redeemable preferred stock, $.0001 par value and $1,000 face value, 1,000,000 shares authorized; 0 and 6,000 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively. Liquidation preference of $0 plus dividends accrued at 7% per annum of $874,228 as of June 30, 2024.		—		1,236,940

STOCKHOLDERS’ EQUITY
Common stock - 150,000,000 shares authorized, $0.0001 par value; 1,254,309 shares issued and outstanding as of June 30, 2024 and 963,489 shares issued and outstanding as of December 31, 2023. *		127		96
Additional paid-in capital		54,261,123		57,957,008
Accumulated other comprehensive income		302		902
Accumulated deficit		(35,464,950)		(33,610,748)

TOTAL STOCKHOLDERS’ EQUITY		18,796,602		24,347,258

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	28,385,214	$	31,113,667


	Three Months Ended		Three Months Ended		Six Months Ended		Six Months Ended
	June 30,		June 30,		June 30,		June 30,
	2024		2023		2024		2023
OPERATING EXPENSES:
Research and development	$	342,068	$	307,211	$	951,317	$	1,184,928
General and administrative		1,238,899		1,522,502		2,321,144		3,566,726
TOTAL OPERATING EXPENSES		1,580,967		1,829,713		3,272,461		4,751,654

OTHER INCOME:
Interest income		330,508		427,159		793,903		823,516
Share of net loss in equity investment		(9,850)		—		(18,450)		—
Change in fair value of warrant liability		(154,000)		(207,000)		(96,000)		381,000
Change in fair value of derivative liability		141,000		(2,484,400)		1,113,000		(2,258,600)
TOTAL OTHER INCOME (LOSS)		307,658		(2,264,241)		1,792,453		(1,054,084)

Net loss before income taxes		1,273,309		4,093,954		1,480,008		5,805,738

Provision for income taxes		—		—		—		—

Net loss		1,273,309		4,093,954		1,480,008		5,805,738

Preferred Stock dividends		155,735		423,575		374,194		689,649
Deemed dividend - preferred stock extinguishment		—		5,693,000		—		5,693,000

Net Loss attributable to common stockholders	$	1,429,044	$	10,210,529	$	1,854,202	$	12,188,387

Change in fair value of available for sale debt security		100		—		(600)		—

Net comprehensive loss	$	1,428,944	$	10,210,529	$	1,854,802	$	12,188,387

PER SHARE DATA:

Basic and diluted loss per common share *	$	1.18	$	34.67	$	1.64	$	41.41

Basic and diluted weighted average common shares outstanding *		1,206,600		294,500		1,128,100		294,300


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the quarterly period ended June 30, 2024


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the transition period from __________________ to __________________


Title of each class		Trading Symbol(s)		Name of each exchange on which registered


Common Stock, $0.0001 par value per share		SNPX		The Nasdaq Stock Market LLC


	Three Months Ended June 30, 2023
								Additional				Accumulated Other
	Preferred Stock				Common Stock			Paid-In		Accumulated		Comprehensive
	Shares		Amount		Shares	Amount		Capital		Deficit		Income (Loss)		Total

Balance April 1, 2023		15,000	$	2,721,723	294,394	$	29	$	53,273,742	$	(21,809,375)	$	—	$	31,464,396

Stock based compensation		—		—	—		—		334,416		—		—		334,416

Issuance of common stock for consulting fees		—		—	217		1		4,499		—		—		4,500

Accrued preferred stock dividends		—		—	—		—		—		(423,575)		—		(423,575)

Preferred stock dividends paid		—		(423,575)	—		—		—		—		—		—

Reclassification of accrued dividends upon probable redemption of preferred stock		—		165,375	—		—		—		—		—		—

Deemed dividend - preferred stock extinguishment		—		423,575	—		—		5,693,000		(5,693,000)		—		—

Preferred stock redemptions		(1,000)		(1,000,000)	—		—		—		—		—		—

Accrual of preferred stock and dividend redemption		—		(2,265,375)	—		—		—		—		—		—

Preferred stock accretion		—		2,455,656	—		—		(2,455,656)		—		—		(2,455,656)

Net loss		—		—	—		—		—		(4,093,954)		—		(4,093,954)

Balance June 30, 2023	$	14,000	$	2,077,379	294,611	$	30	$	56,850,001	$	(32,019,904)	$	—	$	24,830,127


	Three Months Ended June 30, 2024
							Additional				Accumulated Other
	Preferred Stock			Common Stock			Paid-In		Accumulated		Comprehensive
	Shares	Amount		Shares	Amount		Capital		Deficit		Income (Loss)		Total

Balance April 1, 2024	3,000	$	823,555	1,085,137	$	109	$	56,088,576	$	(34,035,906)	$	202	$	22,052,981

Stock based compensation	—		—	—		—		3,420		—		—		3,420

Issuance of common stock for consulting fees	—		—	1,079		1		4,500		—		—		4,501

Preferred stock dividends	—		35,000	—		—		—		(35,000)		—		(35,000)

Reclassification of accrued dividends upon probable redemption of preferred stock	—		—	—		—		—		—		—		—

Deemed dividends on preferred stock	—		120,735	—		—		—		(120,735)		—		(120,735)

Deemed dividend - preferred stock extinguishment	—		—	—		—		—		—		—		—

Preferred stock redemptions and conversions	(1,000)		(620,300)	168,093		17		620,283		—		—		620,300

Accrual of preferred stock and dividend redemption	(2,000)		(2,814,646)	—		—		—		—		—		—

Preferred stock accretion	—		2,455,656	—		—		(2,455,656)		—		—		(2,455,656)

Comprehensive income	—		—	—		—		—		—		100		100

Net loss	—		—	—		—		—		(1,273,309)		—		(1,273,309)

Balance Jule 30, 2024	—	$	—	1,254,309	$	127	$	54,261,123	$	(35,464,950)	$	302	$	18,796,602


	Six Ended June 30, 2023
								Additional				Accumulated Other
	Preferred Stock				Common Stock			Paid-In		Accumulated		Comprehensive
	Shares		Amount		Shares	Amount		Capital		Deficit		Income		Total

Balance January 1, 2023		15,000	$	2,721,723	290,681	$	29	$	52,524,461	$	(19,831,517)	$	—	$	32,692,973

Stock based compensation		—		—	—		—		979,197		—		—		979,197

Issuance of common stock for consulting fees		—		—	3,930		1		108,999		—		—		109,000

Accrued preferred stock dividends		—		—	—		—		—		(689,649)		—		(689,649)

Preferred stock dividends paid		—		(689,649)	—		—		—		—		—		—

Reclassification of accrued dividends upon probable redemption of preferred stock		—		165,375	—		—		—		—		—		—

Deemed dividend - preferred stock extinguishment		—		689,649	—		—		5,693,000		(5,693,000)		—		—

Preferred stock redemptions and conversions		(1,000)		(1,000,000)	—		—		—		—		—		—

Accrual of preferred stock and dividend redemption		—		(2,265,375)	—		—		—		—		—		—

Preferred stock accretion		—		2,455,656	—		—		(2,455,656)		—		—		(2,455,656)

Comprehensive income (loss)		—		—	—		—		—		—		—		—

Net loss		—		—	—		—		—		(5,805,738)		—		(5,805,738)

Balance June 30, 2023	$	14,000	$	2,077,379	294,611	$	30	$	56,850,001	$	(32,019,904)	$	—	$	24,830,127


	Six Months Ended June 30, 2024
							Additional				Accumulated Other
	Preferred Stock			Common Stock			Paid-In		Accumulated		Comprehensive
	Shares	Amount		Shares	Amount		Capital		Deficit		Income		Total

Balance January 1, 2024	6,000	$	1,236,940	963,389	$	96	$	57,957,008	$	(33,610,748)	$	902	$	24,347,258

Stock based compensation	—		—	—		—		17,827		—		—		17,827

Issuance of common stock for consulting fees	—		—	16,701		3		108,998		—		—		109,001

Preferred stock dividends	—		122,500	—		—		—		(122,500)		—		(122,500)

Reclassification of accrued dividends upon probable redemption of preferred stock	—		—	—		—		—		—		—		—

Deemed dividends on preferred stock	—		251,694	—		—		—		(251,694)		—		(251,694)

Deemed dividend - preferred stock extinguishment	—		—	—		—		—		—		—		—

Preferred stock redemptions and conversions	(2,000)		(1,088,630)	274,219		28		1,088,602		—		—		1,088,630

Accrual of preferred stock and dividend redemption	(4,000)		(5,433,816)	—		—		—		—		—		—

Preferred stock accretion	—		4,911,312	—		—		(4,911,312)		—		—		(4,911,312)

Comprehensive income (loss)	—		—	—		—		—		—		(600)		(600)

Net loss	—		—	—		—		—		(1,480,008)		—		(1,480,008)

Balance June 30, 2024	—	$	—	1,254,309	$	127	$	54,261,123	$	(35,464,950)	$	302	$	18,796,602


	Six Months Ended		Six Months Ended
	June 30, 2024		June 30, 2023
CASH FLOW USED IN OPERATING ACTIVITIES
Net loss	$	1,480,008	$	5,805,738
Adjustments to reconcile net loss to net cash used by operating activities
Stock based compensation		17,827		979,197
Change in fair value of warrant liability		96,000		(381,000)
Change in fair value of derivative liability		(1,113,000)		2,258,600
Share of net loss in equity investment		18,450		—
Consulting services paid by issuance of common stock		109,001		109,000
Depreciation expense		2,716		3,414
Change in assets and liabilities:
Decrease in prepaid expenses and other current assets		21,612		590,864
Increase (decrease) in accounts payable		30,697		(221,059)
Decrease in accrued expenses		(388,370)		(468,577)
		(1,205,067)		2,870,439

Net Cash Used in Operating Activities		(2,685,075)		(2,935,299)

CASH FLOWS USED IN INVESTING ACTIVITIES
Purchase of available for sale debt security		(1,000,000)		—
Purchase of fixed assets		—		(2,707)

Net Cash Used in Investing Activities		(1,000,000)		(2,707)

CASH FLOWS FROM FINANCING ACTIVITIES
Redemption of Series B Convertible Preferred Stock		—		(1,000,000)
Dividends on Series B Convertible Preferred Stock		—		(641,064)

Net Cash Provided by (Used in) Financing Activities		—		(1,641,064)

NET DECREASE IN CASH AND EQUIVALENTS		(3,685,075)		(4,579,070)

CASH AND EQUIVALENTS AT BEGINNING OF PERIOD		28,661,498		37,478,480

CASH AND EQUIVALENTS AT END OF PERIOD	$	24,976,423	$	32,899,410

DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Issuance of Common Stock for Series B Convertible Preferred Stock installment conversions	$	1,088,630	$	—
Accretion of Series B Convertible Preferred Stock to redemption value	$	4,911,312	$	—
Accrual of Series B Convertible Preferred Stock and Dividend Redemption	$	5,433,816	$	266,074
Change in fair value of available for sale debt security	$	(600)	$	—


	For the Three Months Ended		For the Six Months Ended
	June 30,		June 30,
	2024	2023	2024	2023
Common Stock Options	32,625	29,674	31,133	5,137
Convertible Preferred Stock	1,987,029	715,068	1,987,029	715,068
Common Stock Warrants	287,436	287,436	287,436	234,211
Total	2,307,090	1,032,178	2,305,598	954,416


				Weighted-
				Average	Aggregate
		Weighted-		Remaining	Intrinsic
	Number	Average		Contractual	Value
	of	Exercise		Term	(in
	Shares	Price		(Years)	millions)
Options outstanding at January 1, 2024	29,674	$	153.75	8.15	$	—
Options granted	3,200	$	5.39	9.23		—
Less options forfeited	—	$	—	—		—
Less options expired/cancelled	—	$	—	—		—
Less options exercised	—	$	—	—		—
Options outstanding at June 30, 2024	32,874	$	139.27	8.27	$	—
Options exercisable at June 30, 2024	29,674	$	153.71	8.10	$	—


	Synaptogenix, Inc.

Date: August 14, 2024	By:	/s/ Alan J. Tuchman, M.D.
		Alan J. Tuchman, M.D.
		Chief Executive Officer
		(principal executive officer)

Date: August 14, 2024	By:	/s/ Robert Weinstein
		Robert Weinstein
		Chief Financial Officer, Executive Vice President, Secretary and Treasurer (principal financial officer and principal accounting officer)

	/s/ Alan J. Tuchman, M.D.
	Alan J. Tuchman, M.D.
	Chief Executive Officer
	(principal executive officer)

	/s/ Robert Weinstein
	Robert Weinstein
	Chief Financial Officer, Executive Vice President, Secretary and Treasurer
	(principal financial officer and principal accounting officer)


Balance of Cannasoul Convertible Notes as of January 1, 2023	$	—
Issued		1,437,598
Change in fair value		902
Balance of Cannasoul Convertible Notes as of December 31, 2023	$	1,438,500
Issued		1,000,000
Change in fair value		(600)
Balance of Cannasoul Convertible Notes as of June 30, 2024	$	2,437,900


		Number
		of shares
Warrants outstanding January 1, 2023		287,436
Warrants issued		—
Warrants exercised		—
Warrants expired		—
Warrants outstanding and exercisable June 30, 2024		287,436


		June 30,		December 31,
Description	Level	2024		2023
Liabilities:
Warrant liability (Note 6)	3	$	236,000	$	140,000
Bifurcated embedded derivative liability (Note 6)	3	$	—	$	1,113,000


	June 30, 2024
Balance on December 31, 2022	$	1,510,000
Change in fair value of warrant liability		(1,370,000)
Balance on December 31, 2023	$	140,000
Change in fair value of warrant liability		96,000
Balance on June 30, 2024	$	236,000


	June 30, 2024
Balance on December 31, 2022	$	369,400
Change in fair value of bifurcated embedded derivative		(743,600)
Balance on December 31, 2023	$	1,113,000
Change in fair value of derivative liability		(1,113,000)
Balance on June 30, 2024	$	0


	Three Months ended
	June 30,				Dollar
	2024		2023		Change		% Change
Operating Expenses:
Research and development expenses	$	342,068	$	307,211	$	34,857	11.3	%
General and administrative expenses	$	1,238,899	$	1,522,502	$	(283,603)	(18.6)	%
Other income (loss), net	$	307,658	$	(2,264,241)	$	2,571,899	—	%
Net loss	$	1,273,309	$	4,093,954	$	(2,820,645)	(68.9)	%


	Six Months Ended June 30,
	2024		2023
Cash used in operating activities	$	2,685,075	$	2,935,299
Cash used in investing activities		1,000,000		2,707
Cash used in (provided by) financing activities		—		1,641,064


Exhibit Number

3.1		Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Synaptogenix, Inc. (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed with the SEC on April 4, 2024).

10.1		Third Amendment to Offer Letter, dated as of June 20, 2024, by and between Alan J. Tuchman, Ph.D. and Synaptogenix, Inc. (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed with the SEC on June 21, 2024).

31.1		Certification of the President and Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*		Certification of the President and 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 the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		The following financial information from this Quarterly Report on Form 10-Q for the period ended June 30, 2024, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) the Condensed Statements of Operations; (ii) the Condensed Balance Sheets; (iii) the Condensed Statements of Cash Flows; and (iv) the Notes to Financial Statements, tagged as blocks of text.

104		Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit)