UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-K/A
(Amendment No. 1)
(Mark One)
☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2021
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 001-38556
Entera Bio Ltd.
(Exact Name of Registrant as Specified in Its Charter)
Israel |
| Not applicable |
(State or Other Jurisdiction of |
| (I.R.S. Employer |
Kiryat Hadassah
Minrav Building – Fifth Floor
Jerusalem, Israel 9112002
(Address of Principal Executive Offices) (Zip Code) |
972-2-532-7151 |
(Registrant’s Telephone Number, Including Area Code) |
Securities registered pursuant to Section 12(b) of the Act: | ||||
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Title of Each Class |
| Trading Symbol |
| Name of Each Exchange on Which Registered |
Ordinary shares, par value NIS 0.0000769 per share |
| ENTX |
| Nasdaq Capital Market |
Warrants to purchase ordinary shares |
| ENTXW |
| 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 and posted 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 and post such files).
Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth 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 accelerated filer | ☐ |
| Accelerated filer | ☐ |
Non-accelerated filer | ☒ |
| Smaller reporting company | ☒ |
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| Emerging 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. ☐
Indicate by check mark whether the registrant has fi led a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting fi rm that prepared or issued its audit report. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
Yes ☐ No ☒
The aggregate market value of the voting stock held by non-affiliates of the registrant was approximately $142.1 million as of June 30, 2021.
As of April 28, 2022, the registrant had 28,804,411 ordinary shares, par value NIS 0.0000769 per share (“Ordinary Shares”) outstanding.
The registrant’s auditor is Kesselman & Kesselman, Tel-Aviv, Israel (PCAOB ID 1309)
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Explanatory Note | ||
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Name | Age | Position |
Executive Officers | ||
Dr. Spiros Jamas | 61 | Chief Executive Officer |
Ramesh Ratan | 72 | U.S.-based Chief Financial Officer |
Dana Yaacov-Garbeli | 38 | Israel-based Chief Financial Officer |
Dr. Phillip Schwartz (5) | 60 | President of Research and Development and Director |
Dr. Hillel Galitzer | 43 | Chief Operating Officer |
Dr. Arthur Santora | 71 | Chief Medical Officer |
Non-Employee Directors | ||
Gerald Lieberman(1) (2) | 75 | Director, Chairman of the Board of Directors |
Dr. Roger J. Garceau (5) | 68 | Director, Chairman of the Scientific Advisory Committee |
Ron Mayron(1) (2) | 59 | Director, Chairman of the Compensation Committee |
Miranda J. Toledano (1) (2) (3) (5) | 45 | Director, Chairwomen of the Audit Committee |
Gerald M. Ostrov(1) (2) (3) | 72 | Director |
Sean Ellis(1) (3) (4) | 47 | Director |
Yonatan Malca (1) (4) (5) | 55 | Director, Chairman of the Corporate Governance and Nomination Committee |
• | the Class I directors are Miranda J. Toledano, Roger Garceau and Ron Mayron; |
• | the Class II directors are Phillip Schwartz and Yonatan Malca; and |
• | the Class III directors are Gerald Lieberman, Gerald M. Ostrov and Mr. Sean Ellis. |
Name and Principal Position | Year | Salary ($) | Bonus ($) | Option Award(s) ($)(1) | All Other Compensation ($) | Total ($) | ||||||||||||||||||
Spiros Jamas(2) | 2021 | 392 | 751 | - | 1,143 | |||||||||||||||||||
Chief Executive Officer | 2020 | - | - | - | - | |||||||||||||||||||
Dr. Phillip Schwartz | 2021 | 453 | - | 183 | 49 | 685 | ||||||||||||||||||
President of R&D | 2020 | 384 | 30 | 169 | 27 | 610 | ||||||||||||||||||
Dr. Hillel Galitzer | 2021 | 319 | - | 260 | 61 | 640 | ||||||||||||||||||
Chief Operating Officer | 2020 | 292 | 50 | 168 | 17 | 527 | ||||||||||||||||||
(1) | Reflects the associated annual expense recorded in our financial statements for the year ended December 31, 2020, based on the grant date fair value of the share-based compensation granted in exchange for the directors’ and officers’ services computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, Compensation – Stock Compensation (“ASC Topic 718”). The assumptions used in calculating the amounts are discussed in the notes of the Company’s audited financial statements for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 8, 2022. The fair value amount is recognized as an expense over the course of the vesting period of the options (subject to any applicable accounting adjustments during that period). |
(2) | Dr. Jamas was appointed as our Chief Executive Officer in January 2021. Therefore, he had no compensation for fiscal year 2020. |
Number of Securities Underlying Unexercised Options | |||||||||
Name | Exercisable | Unexercisable | Option Expiration Date | ||||||
Dr. Spiros Jamas | 1,314,218 | (1) | 1/4/2031 | ||||||
Chief Executive Officer | |||||||||
Dr. Phillip Schwartz | 357,500 | - | 11/23/2023 | ||||||
President of R&D | - | 100,000 | (2) | 4/21/2031 | |||||
Dr. Hillel Galitzer | 143,000 | - | 11/15/2023 | ||||||
Chief Operating Officer | 76,563 | 98,438 | (3) | 3/16/2030 | |||||
125,000 | (4) | 4/21/2031 |
(1) | Of the 1,314,218 unexercisable options as of December 31, 2021, 25% vested on January 4, 2022, the first anniversary of the grant date and the remaining 75% began vesting in 12 equal quarterly installments over the following three years. |
(2) | Of the 100,000 unexercisable options as of December 31, 2021, 25% vested on April 21, 2022, the first anniversary of the grant date and the remaining 75% vests began vesting in 12 equal quarterly installments over the following three years. |
(3) | The 98,438 unexercisable options as of December 31, 2021 began vesting in 9 equal quarterly installments from March 16,2022. |
(4) | Of the 125,000 unexercisable options as of December 31, 2021, 25% vested on April 21,2022, the first anniversary of the grant date and the remaining 75% vests began vesting in 12 equal quarterly installments over the following three years. |
Name | Fees Earned or Paid in Cash ($) | Option Awards ($)(1) | All Other Compensation ($) | Total ($) | ||||||||||||
Gerald Lieberman | 57,938 | 3,816 | 61,754 | |||||||||||||
Dr. Roger J. Garceau | - | 90,000 | (2) | 90,000 | ||||||||||||
Yonatan Malca | 54,075 | 3,816 | 57,891 | |||||||||||||
Ron Mayron | 37.664 | 8,824 | 46,488 | |||||||||||||
Miranda J. Toledano | 65,205 | 3.816 | 69.021 | |||||||||||||
Gerald M. Ostrov | 62,592 | 3.816 | 66,408 | |||||||||||||
Sean Ellis | 55.801 | 9,785 | 65,586 |
(1) | Reflects the associated annual expense recorded in our financial statements for the year ended December 31, 2020, based on the grant date fair value of the share-based compensation granted in exchange for the directors’ and officers’ services computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, Compensation – Stock Compensation (“ASC Topic 718”). The assumptions used in calculating the amounts are discussed in the notes of the Company’s audited financial statements for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 8, 2022. The fair value amount is recognized as an expense over the course of the vesting period of the options (subject to any applicable accounting adjustments during that period). |
Name | Share Options | |||
Gerald Lieberman | 180,928 | |||
Dr. Roger J. Garceau | 356,330 | |||
Yonatan Malca | 33,638 | |||
Ron Mayron | 33,638 | |||
Miranda J. Toledano | 33,638 | |||
Gerald M. Ostrov | 33,638 | |||
Sean Ellis | 33,638 |
(2) | Until January 1 2022, Dr. Garceau received $4,000 per month in consideration for his services as a consultant to the Company. In addition, in 2021 he received bonus of $42,000 related to his service as our temporary Chief Executive Officer in 2020. |
• | each person or entity known by us to own beneficially 5% or more of our outstanding Ordinary Shares; |
• | each of our directors and executive officers individually; and |
• | all of our executive officers and directors as a group. |
Name | Number and Percentage of Ordinary Shares | |||||||
Number | Percent | |||||||
5% or Greater Shareholders (other than directors and executive officers) | ||||||||
D.N.A Biomedical Solutions Ltd.(1) | 3,762,960 | 13.06 | % | |||||
Gakasa Holdings LLC.(2) | 2,484,275 | 8.64 | % | |||||
RA Capital Management, L.P.(3) | 2,353,000 | 8.17 | % | |||||
Executive Officers and Directors: | ||||||||
Yonatan Malca(4) | 58.796 | * | ||||||
Dr. Phillip Schwartz(5) | 989,910 | 3.39 | % | |||||
Gerald Lieberman(6) | 339,572 | 1.17 | % | |||||
Dr. Roger J. Garceau(7) | 379,196 | 1.30 | % | |||||
Dr. Hillel Galitzer(8) | 306,794 | 1.06 | % | |||||
Dr. Arthur Santora(9) | 47,500 | * | ||||||
Miranda J. Toledano(10) | 58,364 | * | ||||||
Gerald M. Ostrov(11) | 61,564 | * | ||||||
Sean Ellis(12) | 61,564 | * | ||||||
Spiros Jamas(13) | 420,693 | 1.44 | % | |||||
Dana Yaacov-Garbeli(14) | 49,688 | * | ||||||
Ron Mayron(15) | 36,049 | * | ||||||
Ramesh Ratan(16) | 10,000 | * | ||||||
All Directors and Executive Officers as a Group (13 persons)(17) | 2,819,690 | 9.69 | % | |||||
(1) | D.N.A Biomedical Solutions Ltd.’s holdings consisted of 3,762,960 Ordinary Shares. D.N.A’s address is at Shimon Hatarsi 43 St., Tel Aviv, Israel. |
(2) | Based on the Schedule 13G/A filed by Gakasa Holdings LLC with the SEC on June 14, 2021 regarding its holdings as of May 19, 2021. Gakasa Holdings LLC’s address is 201 S. Biscayne Blvd., Suite 800, Miami, Florida. |
(3) | Based on the Schedule 13G filed by RA Capital Management, L.P. with the SEC on June 30, 2021 regarding its holdings as of June 30, 2021. RA Capital Management, L.P.’s address is 200 Berkeley Street, 18th Floor, Boston MA 02116 201. |
(4) | Consists of (i) 7,232 Ordinary Shares and (ii) 51,564 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(5) | Consists of (i) 607,410 Ordinary Shares and (ii) 382,500 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(6) | Consists of (i) 140,718 Ordinary Shares and (ii) 198,854 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(7) | Consists of (i) 4,940 Ordinary Shares and (ii) 374,256 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(8) | Consists of (i) 34,106 Ordinary Shares and (ii) 272,688 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(9) | Consists of 47,500 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(10) | Consists of (i) 6,800 Ordinary Shares and (ii) 51,564 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(11) | Consists of (i) 10,000 Ordinary Shares and (ii) 51,564 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(12) | Consists of (i) 10,000 Ordinary Shares and (ii) 51,564 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(13) | Consists of (i) 10,000 Ordinary Shares and (ii) 410,693 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 21, 2022. |
(14) | Consists of 49,688 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(15) | Consists of (i) 7,000 Ordinary Shares and (ii) 29,049 Ordinary Shares underlying options to acquire Ordinary Shares, exercisable within 60 days of April 28, 2022. |
(16) | Consists of 10,000 Ordinary Shares. |
(17) | Consists of (i) 848,206 ordinary Shares and (ii) options to acquire 1,971,484 Ordinary Shares, exercisable within 60 days of April 28, 2022. |
Plan Category | Number of securities to be issued upon exercise of outstanding options, RSUs, warrants and rights (#) | Weighted-average exercise price of outstanding options, RSUs, warrants and rights ($) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (#) | |||||||||
(a) | (b) | (c) | ||||||||||
Equity compensation plans approved by security holders | $ | |||||||||||
2013 Plan | 1,583,010 | 5.71 | - | |||||||||
2018 Plan | 2,733,850 | 2.20 | 391,890 | |||||||||
Equity compensation plans not approved by security holders | - | - | - | |||||||||
Total | 4,316,860 | $ | 3.63 | 391,890 |
ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE |
• | The amounts involved exceeded or will exceed the lesser of (i) $120,000 and (ii) one percent of the average of the Company’s total assets at year end for the last two completed fiscal years; and |
• | A director, executive officer, holder of more than 5% of the outstanding share capital of the Company, or any member of such person’s immediate family had or will have a direct or indirect material interest. |
Year Ended December 31, | ||||||||
2021 | 2020 | |||||||
Audit fees (1) | $ | 190,000 | $ | 145,000 | ||||
Tax fees(2) | 6,500 | 17,000 | ||||||
Total fees | $ | 196,500 | $ | 162,000 |
(1) | Includes professional services rendered in connection with the audit of our annual financial statements and the review of our interim financial statements and services related to the company’s initial public offering and other registration statements. |
(2) | Tax consulting services. |
Item 15. | EXHIBITS, FINANCIAL STATEMENT SCHEDULES. |
(b) | The following exhibits are filed as part of this Amendment No. 1: |
Exhibit No. | Description |
104* | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
Date: April 29, 2022 | ENTERA BIO LTD. | |
By: | /s/ Spiros Jamas | |
Spiros Jamas | ||
Chief Executive Officer |