As filed with the Securities and Exchange Commission on October 23, 2024
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM F-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
NLS Pharmaceutics Ltd.
(Exact name of registrant as specified in its charter)
| Switzerland | 3841 | Not Applicable | ||
| (State or other jurisdiction of incorporation or organization) | (Primary Standard Industrial Classification Code Number) | (I.R.S. Employer Identification Number) |
| Puglisi & Associates | ||
| The Circle 6 | 850 Library Ave., Suite 204 | |
| 8058 Zurich, Switzerland | Newark, DE 19711 | |
| Tel: +41.44.512.2150 | Tel: (302) 738-6680 | |
| (Address, including zip code, and telephone number, including | (Name, address, including zip code, and telephone | |
| area code, of registrant’s principal executive offices) | number, including area code, of agent for service) |
Copies to:
| Oded Har-Even, Esq. | Pascal Honold, Esq. | |
| Howard E. Berkenblit, Esq. | Wenger Vieli AG | |
| Ron Ben-Bassat, Esq. | Dufourstrasse 56 | |
| Sullivan & Worcester LLP | 8034 Zurich, Switzerland | |
| 1251 Avenue of the Americas | Tel: +41.58.958.58.58 | |
| New York, NY 10020 | ||
| Tel: (212) 660-3000 |
Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date hereof.
If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. ☒
If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.
Emerging growth company ☒
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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 7(a)(2)(B) of the Securities Act. ☐
| † | The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012. |
The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
The information in this prospectus is not complete and may be changed. The selling shareholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
| PRELIMINARY PROSPECTUS | SUBJECT TO COMPLETION | DATED OCTOBER 23, 2024 |
Up to 2,747,437 Common Shares
This prospectus relates to the resale, from time to time by the selling shareholders, or the Selling Shareholders, identified in this prospectus of up to 2,747,437 of our common shares, par value CHF 0.80 per share, or the Common Shares, consisting of: (i) 806,452 Common Shares issued in a private placement in October 2024; (ii) 806,452 Common Shares issuable upon the exercise of warrants, issued in a private placement in October 2024; (iii) 806,452 Common Shares issuable upon the conversion of certain of the Company’s preferred shares, and (iv) 328,081 Common Shares issuable upon the exercise of pre-funded warrants issued to certain warrant holders in September and October 2024.
The Selling Shareholders are identified in the table commencing on page 10. No Common Shares are being registered hereunder for sale by us. We will not receive any proceeds from the sale of the Common Shares by the Selling Shareholders. All net proceeds from the sale of the Common Shares covered by this prospectus will go to the Selling Shareholders. We will receive cash proceeds equal to the total exercise price of the common warrants and pre-funded warrants that are exercised for cash, of approximately $3,674,000, based on a weighted average exercise price of $3.24 per share (subject to adjustments) if all of the warrants are exercised. See “Use of Proceeds.” The Selling Shareholders may sell all or a portion of the Common Shares from time to time in market transactions through any market on which our Common Shares are then traded, in negotiated transactions or otherwise, and at prices and on terms that will be determined by the then prevailing market price or at negotiated prices directly or through a broker or brokers, who may act as agent or as principal or by a combination of such methods of sale. See “Plan of Distribution.”
Our Common Shares trade on the Nasdaq Capital Market, or Nasdaq, under the symbol “NLSP”. On October 22, 2024, the last reported sale price of our Common Shares on Nasdaq was $4.84 per share.
We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, and are subject to reduced public company reporting requirements.
Investing in our securities involves a high degree of risk. See “Risk Factors” beginning on page 4 of this prospectus.
Neither the Securities and Exchange Commission, or the SEC, nor any state or other foreign securities commission has approved nor disapproved these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is , 2024.
TABLE OF CONTENTS
i
You should rely only on the information contained in this prospectus and any free writing prospectus prepared by or on behalf of us or to which we have referred you. Neither we nor the Selling Shareholders have authorized anyone to provide you with different information. Neither we nor the Selling Shareholders are offering to sell the Common Shares, nor we are seeking offers to buy the Common Shares, in any jurisdictions where offers and sales are not permitted. The information contained in this prospectus and the documents incorporated by reference into this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of the Common Shares.
We are organized under the laws of Switzerland and our registered office and domicile is located in Kloten (Zurich), Switzerland. Moreover, the majority of our directors and senior management are not residents of the United States, and all or a substantial portion of the assets of such persons are located outside the United States. As a result, it may not be possible for investors to effect service of process within the United States upon us or upon such persons or to enforce against them judgments obtained in U.S. courts, including judgments in actions predicated upon the civil liability provisions of the federal securities laws of the United States. We have been advised by our Swiss counsel that there is doubt as to the enforceability in Switzerland of original actions, or in actions for enforcement of judgments of U.S. courts, of civil liabilities to the extent solely predicated upon the federal and state securities laws of the United States. See “Enforceability of Civil Liabilities” for additional information.
For investors outside of the United States: Neither we nor the Selling Shareholders have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. You are required to inform yourselves about and to observe any restrictions relating to this offering and the distribution of this prospectus.
In this prospectus, “we,” “us,” “our,” the “Company” and “NLS” refer to NLS Pharmaceutics Ltd., and its wholly owned subsidiary, NLS Pharmaceutics Inc., a Delaware corporation.
Our reporting currency and functional currency is the U.S. dollar. Unless otherwise expressly stated or the context otherwise requires, references in this prospectus to “dollars,” “USD” or “$” mean U.S. dollars, and references to “CHF” are to the Swiss Franc. U.S. dollar translations of CHF amounts presented in this prospectus were done on different dates in accordance with the date as of such entry in the Company’s books and are derived from our audited financial statements incorporated by reference in this prospectus. U.S. dollar translations of CHF amounts presented in this prospectus that are not derived from our audited financial statements incorporated by reference in this prospectus are translated using the rate of CHF 1.00 to $1.09, based on the exchange rate provided by the Swiss Federal Tax Administration on June 30, 2024.
All information included herein relating to shares or price per share reflects the 1-for-40 reverse split effected by us on September 27, 2024.
ii
This prospectus describes the general manner in which the Selling Shareholders identified in this prospectus may offer from time to time up to 2,747,437 of our Common Shares, consisting of: (i) 806,452 Common Shares issued in a private placement in October 2024; (ii) 806,452 Common Shares issuable upon the exercise of warrants, issued in a private placement in October 2024; (iii) 806,452 Common Shares issuable upon the conversion of certain of the Company’s preferred shares, and (iv) 328,081 Common Shares issuable upon the exercise of pre-funded warrants issued to certain warrant holders in September and October 2024.
iii
This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our Common Shares. Before you decide to invest in our Common Shares, you should read the entire prospectus carefully, including the “Risk Factors” section, and the financial statements and related notes thereto and the other information incorporated by reference herein.
The Company
We are a clinical-stage biopharmaceutical company focused on the discovery and development of innovative therapies for patients with rare and complex central nervous system, or CNS, disorders with unmet medical needs. Our lead compound mazindol, a triple monoamine reuptake inhibitor and partial orexin receptor 2 agonist, in a proprietary extended-release, or ER, formulation, is being developed for the treatment of narcolepsy (lead indication) and attention deficit hyperactivity disorder, or ADHD (follow-on indication). We believe that this dual mechanism of action will also enable mazindol ER to provide potential therapeutic benefit in other rare and complex CNS disorders. CNS disorders are a diverse group of conditions that include neurological, psychiatric, and substance use disorders. However, treatment options for these conditions are often limited, inadequate or nonexistent, and the development of new CNS treatments generally trails behind other therapeutic areas. We are pursuing the development of the next generation of CNS therapies with high medical impact to address this critical and growing unmet need. Our dual development strategy is designed to optimize the outcome of our clinical programs by developing new chemical entities from known molecules with strong scientific rationale, and also by re-defining previously approved molecules with well-established tolerability and safety profiles, as determined by applicable regulatory agencies. We believe that our streamlined clinical development approach has the potential to advance our product candidates rapidly through early-stage clinical trials, while carrying an overall lower development risk. A lower development risk, we believe, exists with respect to the development of our lead product candidate, Quilience, and follow-on product candidate, Nolazol, due to their use of mazindol as the active ingredient, which was previously approved and marketed in the United States, Japan and Europe to manage exogenous obesity (obesity caused by overeating). As further described in our Report on Form 6-K filed on July 30, 2024, we entered into a binding term sheet on July 29, 2024, with respect to a merger with Kadimastem Ltd., or Kadimastem. See “Risk Factors.”
Closing of Private Placement Financing Transactions
On October 9, 2024, we entered into a securities purchase agreement, or the Equity Purchase Agreement, with certain accredited investors. Pursuant to the terms of the Equity Purchase Agreement, we agreed to issue and sell to the investors, in a private placement offering, (i) 806,452 Common Shares and (ii) or common warrants to purchase 806,452 Common Shares, at a combined purchase price of $3.97, for aggregate gross proceeds of $3.2 million. The common warrants have a term of five years and have an exercise price of $4.25 per share. Pursuant to the Equity Purchase Agreement, we agreed to grant the investors the right to participate, in the aggregate, in up to fifty percent (50%) of future offerings for one year following the closing of the offering. In addition, we agreed to not to enter into an equity line of credit or similar agreement, without the consent of the majority of the holders of the preferred shares (to be issued as described below). The transactions contemplated by the Equity Purchase Agreement closed on October 10, 2024. We and the parties to the Equity Purchase Agreement, pursuant to a Securities Exchange Agreement, upon the approval of our shareholders, which is expected to occur within 30 days of the closing, agreed that they will exchange the Common Shares purchased under the Equity Purchase Agreement for convertible preferred stock.
In addition, on October 9, 2024, we entered into a securities purchase agreement, or the Debt Purchase Agreement, with an accredited investor, pursuant to which in exchange for the satisfaction of our debt in the aggregate amount of $4.0 million held by the investor, we agreed to issue 806,452 newly designated convertible preferred shares, at a purchase price of $4.96 (rounded). The preferred shares contain a conversion price of $4.96 per share. The transactions contemplated by the Debt Purchase Agreement closed on October 10, 2024. Pursuant to the Debt Purchase Agreement, we agreed to grant the investor the right to purchase up to an additional $10.0 million worth of convertible preferred shares beginning six months after the closing and continuing for as long as the investor owns preferred shares. Additionally, pursuant to the Debt Purchase Agreement, we agreed to grant the investor the right to participate in up to fifty percent (50%) of future offerings of our securities for one year following the closing. In addition, we agreed not to enter into an equity line of credit or similar agreement, without the consent of the majority of the holders of the preferred shares.
1
In connection with the Equity Purchase Agreement and the Debt Purchase Agreement, we agreed to register the resale of the Common Shares and Warrants sold and Common Shares underlying the convertible preferred shares.
Entry into Warrant Amendment Agreements
On September 16, 2024, we and a certain institutional investor entered into a warrant amendment agreement to amend those warrants issued by us to the investor, collectively, to purchase up to 172,837 Common Shares. The amendment makes certain adjustments to the definition of a "Fundamental Transaction" in such warrants. In addition, we agreed to adjust the exercise price in such warrants to CHF 0.80 per share (on a post-split basis), and agreed to issue to the investor pre-funded warrants to purchase up to 191,431 Common Shares.
On October 9, 2024, we and certain existing warrant holders entered into warrant amendment agreements to amend those warrants issued by us to such holders, collectively, to purchase up to 105,843 Common Shares issued to such holders. The amendment makes certain adjustment to the definition of a “Fundamental Transaction” in such warrants. In addition, we agreed to adjust the exercise price of such warrants to CHF 0.80 per share and issued to such holders pre-funded warrants to purchase up to 136,650 Common Shares.
Each pre-funded warrant is exercisable for one Common Share at an exercise price of CHF 0.80 per share. The pre-funded warrants are immediately exercisable and may be exercised at any time until all of the pre-funded warrants are exercised in full.
In connection with amendments, we agreed to register the resale of the Common Shares issuable upon the exercise of the pre-funded warrants.
Nasdaq Compliance
On October 15, 2024, we announced that we believe that we have regained compliance with the minimum bid price requirement pursuant to Nasdaq Listing Rule 5550(a)(2), due to the fact that our Common Shares have traded above $1.00 for ten consecutive trading days. In addition, due in part to the foregoing transactions, we also announced that we believe that we satisfy the stockholders' equity requirement of at least $2.5 million pursuant to Nasdaq Listing Rule 5550(b)(1) for continued listing on the Nasdaq Capital Market.
Corporate Information
Our registered office and principal executive offices are located at The Circle 6, 8058 Zurich, Switzerland. Our telephone number in Switzerland is +41.44.512.2150. Our website address is https://nlspharma.com. The information contained on, or that can be accessed through, our website is not part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference.
The SEC also maintains an Internet website that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. Our filings with the SEC are also available to the public through the SEC’s website at http://www.sec.gov.
2
This prospectus relates to the resale by the Selling Shareholders identified in this prospectus of up to 2,747,437 of our Common Shares, consisting of: (i) 806,452 Common Shares issued in a private placement in October 2024; (ii) 806,452 Common Shares issuable upon the exercise of warrants, issued in a private placement in October 2024; (iii) 806,452 Common Shares issuable upon the conversion of certain of the Company’s preferred shares, and (iv) 328,081 Common Shares issuable upon the exercise of pre-funded warrants issued to certain warrant holders in September and October 2024. Common Shares issuable upon the exercise of pre-funded warrants issued to certain warrant holders in October 2024. All of the Common Shares, when sold, will be sold by the Selling Shareholders. The Selling Shareholders may sell their Common Shares from time to time at prevailing market prices. We will not receive any proceeds from the sale of the Common Shares by the Selling Shareholders. However, we will receive cash proceeds equal to the total exercise price of the common warrants and prefunded warrants that are exercised for cash, of approximately $3,674,000, based on a weighted average exercise price of $3.24 per Common Share (subject to adjustments, if any), if all of the warrants are exercised. We intend to use the proceeds, if any, from such warrant exercises for working capital and general corporate purposes.
| Common Shares currently issued and outstanding | 1,067,667 Common Shares. | |
| Common Shares offered by the Selling Shareholders | 2,747,437 Common Shares. | |
| Use of proceeds | We will not receive any proceeds from the sale of the Common Shares by the Selling Shareholders. However, we will receive cash proceeds equal to the total exercise price of the warrants that are exercised for cash, of approximately $3,674,000, based on a weighted average exercise price of $3.24 per Common Share (subject to adjustments, if any), if all of the warrants are exercised. We intend to use the proceeds, if any, from such warrant exercises for working capital and general corporate purposes. See “Use of Proceeds.” | |
| Risk factors | Investing in our Common Shares involves a high degree of risk. You should read the “Risk Factors” section starting on page 4 of this prospectus, and other information included or incorporated by reference in this prospectus for a discussion of factors to consider carefully before deciding to invest in the Common Shares. | |
| Nasdaq Capital Market symbol | Our Common Shares are listed on the Nasdaq Capital Market under the symbol “NLSP.” |
Unless otherwise indicated, the number of Common Shares outstanding prior to and after this offering is based on 3,815,104 Common Shares outstanding, after the registration of the capital increase resolved on October 22, 2024, and excludes the following:
| ● | 384,878 warrants to purchase of our Common Shares and |
| ● | 38,873 options to purchase of our Common Shares. |
3
An investment in the Common Shares involves a high degree of risk. We operate in a dynamic and rapidly changing industry that involves numerous risks and uncertainties. You should consider carefully the risk factor described below and the risks described under the caption “Item 3. Key Information - D. Risk Factors” in our annual report on Form 20-F for the year ended December 31, 2023, or the 2023 Annual Report, which is incorporated by reference in this prospectus, before deciding whether to invest in the Common Shares. The risks described below are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business operations. If any of these risks actually occur, our business, financial condition, operating results or cash flows could be materially adversely affected. This could cause the trading price of the Common Shares to decline, and you may lose all or part of your investment.
Our ability to successfully complete mergers and acquisitions, including the transaction contemplated by our recent binding term sheet with Kadimastem is subject to significant risks and uncertainties.
We entered into a binding term sheet on July 29, 2024, with respect to a merger with Kadimastem. Although the term sheet is binding, the companies signatory to it may not ultimately complete the merger. There may be delays in closing the transaction or the transaction may not close at all, due to factors such as insufficient liquidity, new information discovered during due diligence, changes in market conditions, or other unforeseen circumstances. Even if the transaction is completed, integrating the new business may present challenges, including aligning operations, systems, and cultures, as well as retaining key personnel. Additionally, we may face unanticipated financial or business liabilities that could adversely affect our existing operations. A failure to complete this transaction could negatively impact our liquidity.
Acquisitions may also require significant capital investment, potentially resulting in increased debt or shareholder dilution. Management’s focus may be diverted from other business priorities, potentially affecting overall company performance. The failure to successfully integrate businesses or achieve the anticipated synergies and benefits could negatively impact our business, financial condition, and results of operations. In summary, mergers and acquisitions, while potentially beneficial, carry substantial risks that could materially harm our company if not managed effectively.
4
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Some of the statements made under “Our Business and “Use of Proceeds” and elsewhere in this prospectus, including in our 2023 Annual Report, or incorporated by reference herein constitute forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” “intends” or “continue,” or the negative of these terms or other comparable terminology.
These forward-looking statements may include, but are not limited to, statements relating to our objectives, plans and strategies, statements that contain projections of results of operations or of financial condition, expected capital needs and expenses, statements relating to the research, development, completion and use of our product candidates, and all statements (other than statements of historical facts) that address activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future.
Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. We have based these forward-looking statements on assumptions and assessments made by our management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate.
Important factors that could cause actual results, developments and business decisions to differ materially from those anticipated in these forward-looking statements include, among other things:
| ● | the regulatory pathways that we may elect to utilize in seeking European Medicines Agency, or EMA, the U.S. Food and Drug Administration, or FDA, and other regulatory approvals; | |
| ● | that our financial position raises substantial doubt about our ability to continue as a going concern; | |
| ● | our ability to maintain listing and effectively comply with the listing requirements of The Nasdaq Stock Market LLC, or Nasdaq; |
| ● | the completion and timing of the transaction contemplated by our binding term sheet with Kadimastem are uncertain, and the risk that the transaction may not close as expected or at all; |
| ● | our ability to drive revenue growth, enhance research and development capabilities, and improve financial performance as a result of the potential merger with Kadimastem is subject to uncertainties, including unforeseen costs and integration issues; |
| ● | the re-scheduling of Mazindol ER in the United States by the U.S. Drug Enforcement Agency following approval by the FDA; |
| ● | the launch of a different formulation or different dosage of Mazindol by another company; |
| ● | the use of Quilience (Mazindol ER) in a compassionate use program, or CUP, and the results thereof; |
| ● | obtaining EMA and FDA approval of, or other regulatory action in Europe or the United States and elsewhere with respect to, Quilience, Nolazol NLS-4, or other product candidates that we may seek to develop; |
| ● | the commercial launch and future sales of Quilience and/or Nolazol, or any other future product candidates; |
5
| ● | the dosage of Quilience, Nolazol, and or any of our pipeline drugs; | |
| ● | our ability to move NLS-3, NLS-8, NLS-11, NLS-12 and any of our Aexon Labs (Dual) Orexin compounds (recently secured through an in-license) into investigational new drug enabling studies; | |
| ● | our expectations regarding the timing of commencing further clinical trials, the process entailed in conducting each such trial, including dosages, and the order of such trials with each of our product candidates or whether such trials will be conducted at all; |
| ● | improved convenience relating to the prescription of and use of Nolazol for prescribers and patients (and their parents); |
| ● | our expectations regarding the supply of mazindol; |
| ● | third-party payor reimbursement for Quilience, Nolazol, and or any of our pipeline drugs; | |
| ● | our estimates regarding anticipated expenses, capital requirements and our needs for additional financing; |
| ● | changes to the narcolepsy patient market size and market adoption of Quilience by physicians and patients; |
| ● | the timing, cost, regulatory approvals or other aspects of the commercial launch of Quilience and Nolazol; |
| ● | submission of a Marketing Authorisation Application and New Drug Application with the EMA and FDA for Quilience, Nolazol, and or any of our pipeline drugs, respectively; |
| ● | completion and receiving favorable results of clinical trials for Quilience, Nolazol, and or any of our pipeline drugs; | |
| ● | issuance of patents to us by the U.S. Patent and Trademark Office and other governmental patent agencies; |
| ● | new issuances of orphan drug designations; | |
| ● | the overall global political and economic environment in the countries in which we operate; | |
| ● | the development and approval of the use of mazindol for additional indications other than narcolepsy and attention deficit hyperactivity disorder, or ADHD; | |
| ● | the development and commercialization, if any, of any other product candidates that we may seek to develop; | |
| ● | the use of mazindol controlled release for treatment of additional indications other than narcolepsy, idiopathic hypersomnia and ADHD; and |
| ● | the ability of our management team to lead the development of our product candidates, conclude a strategic partnership deal for Mazindol or any of our pipeline compounds. |
These statements are only current predictions and are subject to known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from those anticipated by the forward-looking statements. We discuss many of these risks in this in greater detail under the heading “Risk Factors” and elsewhere in this prospectus and the documents incorporated herein by reference. You should not rely upon forward-looking statements as predictions of future events.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Except as required by law, we are under no duty to update or revise any of the forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this prospectus.
6
We will not receive any proceeds from the sale of the Common Shares by the Selling Shareholders. All net proceeds from the sale of the Common Shares will go to the Selling Shareholders.
We may receive proceeds from the exercise of the warrants to the extent that the warrants are exercised for cash. If all of the warrants are exercised for cash, the proceeds to us would be approximately $3,674,000, based on a weighted average exercise price of $3.24 per Common Share, if all of the warrants are exercised (subject to adjustment for reverse and forward share splits, share dividends, share combinations and other similar transactions of the Common Shares). We expect to use the net proceeds of such warrant exercises, if any, together with our existing cash for working capital and general corporate purposes. We can make no assurances that any of the warrants will be exercised, or if exercised, the quantity which will be exercised or the period in which they will be exercised.
7
The following table sets forth our cash and cash equivalents and our capitalization as of June 30, 2024:
| ● | on an actual basis; |
| ● | on a pro-forma basis to reflect (i) the realization of approximately $2,500,000 of deferred revenue due to termination of EF License Agreement on August 28, 2024, effective as of September 30, 2024; (ii) the conversion of related party debt holders in the amount of $2,788,650 into 493,986 common shares; (iii) payments to vendors and reduction in bonus accruals not to be paid in the amount of approximately $721,781; and |
| ● | on a pro-forma as adjusted basis to give effect to the issuance of (i) 806,452 Common Shares issued in a private placement in October 2024; (ii) exercise of 806,452 Common Shares, issued in a private placement in October 2024; (iii) 806,452 Common Shares issued upon the conversion of certain of the Company’s preferred shares through debt purchase agreement of $4,000,000; (iv) exercise of 328,081 Common Shares pre-funded warrants issued to certain warrant holders in September and October 2024; and (v) the sale of 81,944 common shares at a purchase price of $9.60 per share on July 1, 2024 and generated net proceeds of $573,784. |
The information in this table should be read in conjunction with and is qualified by reference to the financial information thereto and other financial information incorporated by reference into this prospectus, including the section entitled “Item 5. Operating and Financial Review and Prospects” and our financial statements and related notes included in our 2023 Annual Report, incorporated by reference herein.
| As of June 30, 2024 | ||||||||||||
| U.S. dollars in thousands | Actual | Pro Forma | Pro Forma As Adjusted | |||||||||
| Cash and cash equivalents | $ | 552,758 | $ | 7,202,819 | $ | 7,755,577 | ||||||
| Liabilities including current portion: | ||||||||||||
| Accounts payable, including related party of $411,806 and $265,864, as of June 30, 2024 and December 31, 2023, respectively | 4,584,284 | (4,376,598 | ) | 207,686 | ||||||||
| Related party short-term loan | 1,512,319 | (1,512,319 | ) | — | ||||||||
| Other accrued liabilities | 1,420,229 | (1,420,229 | ) | — | ||||||||
| Note payable short-term loan | 201,285 | (201,285 | ) | — | ||||||||
| Non-current liabilities | 2,743,599 | (2,500,000 | ) | 243,599 | ||||||||
| Total liabilities | 10,461,716 | 10,010,431 | 451,285 | |||||||||
| Shareholders’ equity: | ||||||||||||
| Common Shares, par value of CHF 0.80: 985,723 shares outstanding actual, 2,829,381 shares outstanding pro forma and 3,815,104 shares outstanding pro forma as adjusted | 808,555 | 2,658,694 | 3,467,249 | |||||||||
| Additional paid-in capital | 62,328,298 | 14,554,557 | 76,882,855 | |||||||||
| Accumulated deficit | (72,409,318 | ) | — | (72,409,318 | ) | |||||||
| Accumulated other comprehensive loss | 4,207 | — | 4,207 | |||||||||
| Total shareholders’ equity | (9,268,258 | ) | 17,213,250 | 7,944,992 | ||||||||
| Total capitalization | $ | 1,193,458 | $ | 7,202,819 | $ | 8,396,277 | ||||||
The above discussion and table are based on 985,723 Common Shares outstanding as June 30, 2024.
8
The Common Shares being offered by the Selling Shareholders consist of 2,747,437 of our Common Shares, consisting of: 806,452 Common Shares issuable upon the exercise of warrants, issued in a private placement in October 2024; (ii) 806,452 Common Shares issuable upon the conversion of certain of the Company’s preferred shares; (iii) 806,452 Common Shares issued in a private placement in October 2024, and (iv) 328,081 Common Shares issuable upon the exercise of pre-funded warrants issued to certain warrant holders in September and October 2024.
On October 9, 2024, we entered the Equity Purchase Agreement pursuant to which we agreed to issue and sell to investors, in a private placement offering, (i) 806,452 Common Shares and (ii) or common warrants to purchase 806,452 Common Shares, at a combined purchase price of $3.97, for aggregate gross proceeds of $3.2 million.
In addition, on October 9, 2024, we entered into the Debt Purchase Agreement with an accredited investor, pursuant to which in exchange for the satisfaction of our debt in the aggregate amount of $4.0 million held by the investor, we agreed to issue 806,452 newly designated convertible preferred shares, at a purchase price of $4.96 (rounded). The preferred shares contain a conversion price of $4.96 per share.
On September 16, 2024, we and a certain institutional investor entered into a warrant amendment agreement pursuant to which we agreed to issue to the investor pre-funded warrants to purchase up to 191,431 Common Shares.
On October 9, 2024, we and certain existing warrant holders entered into warrant amendment agreements to amend those warrants issued by us to such holders, and issued to such holders pre-funded warrants to purchase up to 136,650 Common Shares.
In connection with the Equity Purchase Agreement, Debt Purchase Agreement and the warrant amendments, we agreed to register the resale of the Common Shares and Common Shares underlying the preferred shares, the common warrants and the pre-funded warrants.
Other than the relationships described herein, to our knowledge, the Selling Shareholders are not employees or suppliers of ours or our affiliates. Within the past three years, other than the relationships described herein, the Selling Shareholders have not held a position as an officer or a director of ours, nor have any of the Selling Shareholders had any material relationship of any kind with us or any of our affiliates. All information with respect to share ownership has been furnished by the Selling Shareholders, unless otherwise noted. The Common Shares being offered are being registered to permit public secondary trading of such Common Shares and each Selling Shareholders may offer all or part of the Common Shares it owns for resale from time to time pursuant to this prospectus. None of the Selling Shareholders have any family relationships with our officers, directors or controlling shareholders.
The term “Selling Shareholder(s)” also includes any transferees, pledgees, donees, or other successors in interest to the Selling Shareholders named in the table below. Unless otherwise indicated, to our knowledge, the person named in the table below has sole voting and investment power (subject to applicable community property laws) with respect to the Common Shares set forth opposite such person’s name. We will file a supplement to this prospectus (or a post-effective amendment hereto, if necessary) to name successors to the named Selling Shareholders who are able to use this prospectus to resell the Common Shares offered hereby.
A selling shareholder who is an affiliate of a broker-dealer and any participating broker-dealer is deemed to be an “underwriter” within the meaning of the Securities Act, and any commissions or discounts given to any such selling shareholder or broker-dealer may be regarded as underwriting commissions or discounts under the Securities Act. To our knowledge, except as set forth below, none of the selling shareholders is an affiliate of a broker-dealer and there are no participating broker-dealers.
Beneficial ownership is determined in accordance with Rule 13d-3(d) promulgated by the SEC under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and includes Common Shares with respect to which the Selling Shareholder has voting and investment power. The table below lists the Selling Shareholders and other information regarding the beneficial ownership of the Common Shares held by the Selling Shareholders. The second column lists the number of Common Shares beneficially owned by the Selling Shareholders based on their ownership of Common Shares as of October 22, 2024.
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The third column lists the maximum number of Common Shares being offered by this prospectus by the Selling Shareholders. The number of shares that may actually be sold by the Selling Shareholders may be fewer than the number of shares being offered by this prospectus.
The fourth column assumes the sale of all of the Common Shares offered by the Selling Shareholder pursuant to this prospectus. The table below in the first column lists the Selling Shareholders and other information regarding the beneficial ownership of the Common Shares held by them.
In accordance with the terms of the Equity Purchase Agreement, Debt Purchase Agreement and the warrant amendment agreements with the Selling Shareholders, this prospectus generally covers the resale of the maximum number of Common Shares sold to them, and Common Shares issuable upon conversion of preferred shares and exercise of common warrants and pre-funded warrants issued to them in the private placement. Because the number of Common Shares may be adjusted for reverse and forward share splits, share dividends, share combinations and other similar transactions, the number of Common Shares that will actually be issued may be more or less than the number of Common Shares being offered by this prospectus. Under the terms of the warrants, a Selling Shareholder may not exercise the warrants to the extent such exercise would cause such Selling Shareholder, together with its affiliates, to beneficially own a number of Common Shares which would exceed 4.99% or 9.99% of our then outstanding Common Shares following such exercise, excluding for purposes of such determination, Common Shares not yet issuable upon exercise of the warrants which have not been exercised. The number of Common Shares does not reflect this limitation. The Selling Shareholders may sell all, some or none of its shares in this offering. See “Plan of Distribution.”
| Number of Common Shares Owned Prior to Offering | Maximum Number of Common Shares to be Offered Pursuant to this | Number of Common Shares Owned After Offering | ||||||||||||||||||
| Name of Selling Shareholder | Number(1) | Percent(3) | Prospectus | Number(2) | Percent(3) | |||||||||||||||
| Alpha Capital Anstalt(4) | 1,222,278 | 9.99 | % | 1,222,278 | (4) | 0 | * | % | ||||||||||||
| League Jinn Sarl(5) | 415,826 | 4.99 | % | 415,826 | (5) | 0 | * | % | ||||||||||||
| Revel Family Ltd.(6) | 378,024 | 4.99 | % | 378,024 | (6) | 0 | * | % | ||||||||||||
| Ronald Hafner | 652,492 | 41.8 | % | 203,539 | (7) | 448,953 | 41.8 | % | ||||||||||||
| Jurgen Bauer | 50,404 | 4.7 | % | 50,404 | (8) | 0 | * | % | ||||||||||||
| RainForest Partners LLC(9) | 151,210 | 4.99 | % | 151,210 | (9) | 0 | * | % | ||||||||||||
| Armistice Capital LLC(10) | 364,267 | 4.99 | % | 191,431 | (10) | 172,836 | 4.99 | % | ||||||||||||
| Charles Worthman | 417 | * | % | 236 | (11) | 181 | * | % | ||||||||||||
| Craig Schwabe | 1,404 | * | % | 798 | (12) | 606 | * | % | ||||||||||||
| Michael Vasinkevich | 26,694 | 2.5 | % | 15,161 | (13) | 11,533 | 1.0 | % | ||||||||||||
| Noam Rubenstein | 13,113 | 1.2 | % | 7,447 | (14) | 5,666 | * | % | ||||||||||||
| District 2 Capital Fund LP(15) | 23,659 | 2.2 | % | 12,227 | (15) | 11,432 | 1.0 | % | ||||||||||||
| Intracoastal Capital LLC(16) | 48,541 | 4.5 | % | 26,847 | (16) | 21,694 | 2.0 | % | ||||||||||||
| Lincoln Park Capital Fund LLC(17) | 34,284 | 3.2 | % | 12,227 | (17) | 22,057 | 1.1 | % | ||||||||||||
| Lind Global Fund II LP(18) | 103,530 | 4.99 | % | 59,780 | (18) | 43,750 | 4.0 | % | ||||||||||||
| * | Less than 1% |
| (1) | Beneficial ownership is determined in accordance with SEC rules and generally includes voting or investment power with respect to securities. Common Shares subject to options or warrants currently exercisable, or exercisable within 60 days of October 22, 2024, are counted as outstanding for computing the percentage of the Selling Shareholder holding such options or warrants but are not counted as outstanding for computing the percentage of any other Selling Shareholder. |
| (2) | Assumes the sale of all Common Shares being offered pursuant to this prospectus. |
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| (3) | Assumes the full exercise of warrants, subject to the beneficial ownership limitations contained in such warrants. |
| (4) | Consists of (i) 806,452 Common Shares, (ii) 207,913 Common Shares issuable upon conversion of preferred shares and (iii) 207,913 Common Shares issuable upon exercise of common warrants. The address for the selling shareholder is Lettstrasse 32, Vaduz 9490, Liechtenstein. Nicola Feuerstein, a Director of the selling shareholder, holds voting and dispositive power over the securities held by the selling shareholder. |
| (5) | Consists of (i) 207,913 Common Shares and (ii) 207,913 Common Shares issuable upon exercise of common warrants. |
| (6) | Revel Family Ltd. is controlled by Michael Revel, its sole equity owner, who is deemed to have beneficial ownership of the securities. The address of Revel Family Ltd. is 52 HaNasi HaRishon Street, Rehovot, Israel, 7630242. Consists of (i) 189,012 Common Shares and (ii) 189,012 Common Shares issuable upon exercise of common warrants. |
| (7) | Consists of (i) 100,807 Common Shares, (ii) 100,807 Common Shares issuable upon exercise of common warrants and (iii) 1,925 Common Shares issuable upon exercise of pre-funded warrants. Ronald Hafner is Chairman of NLS Pharmaceutics Ltd. |
| (8) | Consists of (i) 25,202 Common Shares and (ii) 25,202 Common Shares issuable upon exercise of common warrants. |
| (9) | Consists of (i) 75,605 Common Shares and (ii) 75,605 Common Shares issuable upon exercise of common warrants. The securities in the foregoing sentence are held by Rainforest Partners LLC, which is controlled by Mark Weinberger, its managing member. The address of Rainforest Partners LLC is 850 East 26th Street, Brooklyn, NY 11210. |
| (10) | Consists of 191,431 Common Shares issuable upon exercise of pre-funded warrants. The securities are directly held by Armistice Capital Master Fund Ltd., a Cayman Islands exempted company (the “Master Fund”) and may be deemed to be beneficially owned by: (i) Armistice Capital, LLC (“Armistice Capital”), as the investment manager of the Master Fund; and (ii) Steven Boyd, as the Managing Member of Armistice Capital. The warrants are subject to a beneficial ownership limitation of 4.99%, which such limitation restricts the Selling Stockholder from exercising that portion of the warrants that would result in the Selling Stockholder and its affiliates owning, after exercise, a number of shares of common stock in excess of the beneficial ownership limitation. The address of Armistice Capital Master Fund Ltd. is c/o Armistice Capital, LLC, 510 Madison Avenue, 7th Floor, New York, NY 10022. |
| (11) | Consists of 236 Common Shares issuable upon exercise of pre-funded warrants. Mr. Worthman has indicated that he is an affiliate of a broker-dealer. |
| (12) | Consists of 798 Common Shares issuable upon exercise of pre-funded warrants. Mr. Schwabe has indicated that he is an affiliate of a broker-dealer. |
| (13) | Consists of 15,161 Common Shares issuable upon exercise of pre-funded warrants. Mr. Vasinkevich has indicated that he is an affiliate of a broker-dealer. |
| (14) | Consists of 7,447 Common Shares issuable upon exercise of pre-funded warrants. Mr. Rubenstein has indicated that he is an affiliate of a broker-dealer. |
| (15) | Consists of 12,227 Common Shares issuable upon exercise of pre-funded warrants. District 2 Capital Fund LP, a Delaware limited partnership, is a fund managed by District 2 GP LLC, its GP, or District. All investment decisions for District are made by Managing Member, Mr. Michael Bigger. The business address of District 2 is 14 Wall Street, 2nd Floor, Huntington, New York 11743. |
| (16) | Consists of 26,847 Common Shares issuable upon exercise of pre-funded warrants. The securities in the foregoing sentence are held by Intracoastal Capital LLC, which is controlled by Mitchell P. Kopin and Daniel B. Asher, its managers, who are deemed to have beneficial ownership of such securities. The address of Intracoastal Capital LLC is 245 Palm Trail, Delray Beach, FL 33483. |
| (17) | Consists of 12,227 Common Shares issuable upon exercise of pre-funded warrants. Josh Scheinfeld and Jonathan Cope, the Managing Members of Lincoln Park Capital, LLC, are deemed to be beneficial owners of all of the Common Shares owned by Lincoln Park Capital Fund, LLC. Messrs. Cope and Scheinfeld have shared voting and investment power over the Common Shares being offered under this prospectus. Lincoln Park Capital, LLC is not a licensed broker dealer or an affiliate of a licensed broker dealer. |
| (18) | Consists of 59,780 Common Shares issuable upon exercise of pre-funded warrants. The securities in the foregoing sentence are held by Lind Global Fund II LP, which is controlled by Jeff Easton, its managing member. The address of Lind Global Fund II LP is 444 Madison Ave., 41st Floor, New York, NY 10022. |
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We are registering the Common Shares that may be issued upon conversion of the preferred shares, Common Shares and shares issuable upon exercise of certain common warrants and pre-funded warrants, pursuant to the terms of the Equity Purchase Agreement, Debt Purchase Agreement and certain warrant amendment agreements, to permit the resale of these Common Shares by the holders of such shares and warrants from time to time after the date of this prospectus. We will not receive any of the proceeds from the sale by the Selling Shareholders of the Common Shares. We will bear all fees and expenses incident to our obligation to register the Common Shares.
The Selling Shareholders may sell all or a portion of the Common Shares beneficially owned by them and offered hereby from time to time directly or through one or more underwriters, broker-dealers or agents. If the Common Shares are sold through underwriters or broker-dealers, the Selling Shareholders will be responsible for underwriting discounts or commissions or agent's commissions. The Common Shares may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale, or at negotiated prices. These sales may be effected in transactions, which may involve crosses or block transactions, pursuant to one or more of the following methods:
| ● | on any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale; | |
| ● | in the over-the-counter market; | |
| ● | in transactions otherwise than on these exchanges or systems or in the over-the-counter market; | |
| ● | through the writing of options, whether such options are listed on an options exchange or otherwise; | |
| ● | ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; | |
| ● | block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; | |
| ● | purchases by a broker-dealer as principal and resale by the broker-dealer for its account; | |
| ● | an exchange distribution in accordance with the rules of the applicable exchange; | |
| ● | privately negotiated transactions; | |
| ● | short sales effected after the effective date of this Registration Statement; | |
| ● | sales pursuant to Rule 144; | |
| ● | broker-dealers may agree with the selling securityholders to sell a specified number of such shares at a stipulated price per share; | |
| ● | a combination of any such methods of sale; and | |
| ● | any other method permitted pursuant to applicable law. |
If the Selling Shareholders effect such transactions by selling Common Shares to or through underwriters, broker-dealers or agents, such underwriters, broker-dealers or agents may receive commissions in the form of discounts, concessions or commissions from the Selling Shareholders or commissions from purchasers of the Common Shares for whom they may act as agent or to whom they may sell as principal (which discounts, concessions or commissions as to particular underwriters, broker-dealers or agents may be in excess of those customary in the types of transactions involved). In connection with sales of the Common Shares or otherwise, the Selling Shareholders may enter into hedging transactions with broker-dealers, which may in turn engage in short sales of the Common Shares in the course of hedging in positions they assume. The Selling Shareholders may also sell Common Shares short and deliver Common Shares covered by this prospectus to close out short positions and to return borrowed shares in connection with such short sales. The Selling Shareholders may also loan or pledge Common Shares to broker-dealers that in turn may sell such shares.
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The Selling Shareholders may pledge or grant a security interest in some or all of the Common Shares, or Preferred Shares owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the Common Shares from time to time pursuant to this prospectus or any amendment to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act of 1933, as amended, amending, if necessary, the list of Selling Shareholders to include the pledgee, transferee or other successors in interest as Selling Shareholders under this prospectus. The Selling Shareholders also may transfer and donate the Common Shares in other circumstances in which case the transferees, donees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus.
The Selling Shareholders and any broker-dealer participating in the distribution of the Common Shares may be deemed to be “underwriters” within the meaning of the Securities Act, and any commission paid, or any discounts or concessions allowed to, any such broker-dealer may be deemed to be underwriting commissions or discounts under the Securities Act. At the time a particular offering of the Common Shares is made, a prospectus supplement, if required, will be distributed which will set forth the aggregate amount of Common Shares being offered and the terms of the offering, including the name or names of any broker-dealers or agents, any discounts, commissions and other terms constituting compensation from the Selling Shareholders and any discounts, commissions or concessions allowed or re-allowed or paid to broker-dealers.
Under the securities laws of some states, the Common Shares may be sold in such states only through registered or licensed brokers or dealers. In addition, in some states the Common Shares may not be sold unless such shares have been registered or qualified for sale in such state or an exemption from registration or qualification is available and is complied with.
There can be no assurance that any selling stockholder will sell any or all of the Common Shares registered pursuant to the registration statement, of which this prospectus forms a part.
The Selling Shareholders and any other person participating in such distribution will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including, without limitation, Regulation M of the Exchange Act, which may limit the timing of purchases and sales of any of the Common Shares by the Selling Shareholders and any other participating person. Regulation M may also restrict the ability of any person engaged in the distribution of the Common Shares to engage in market-making activities with respect to the Common Shares. All of the foregoing may affect the marketability of the Common Shares and the ability of any person or entity to engage in market-making activities with respect to the Common Shares.
We will pay all expenses of the registration of the Common Shares, estimated to be $104,092.65 in total, including, without limitation, SEC filing fees and expenses of compliance with state securities or “blue sky” laws; provided, however, that a selling stockholder will pay all underwriting discounts and selling commissions, if any. We will indemnify the Selling Shareholders against liabilities, including some liabilities under the Securities Act, in accordance with the Registration Rights Agreement, or the Selling Shareholders will be entitled to contribution. We may be indemnified by the Selling Shareholders against civil liabilities, including liabilities under the Securities Act, that may arise from any written information furnished to us by the selling stockholder specifically for use in this prospectus, in accordance with the Registration Rights Agreement, or we may be entitled to contribution.
Once sold under the registration statement, of which this prospectus forms a part, the Common Shares will be freely tradable in the hands of persons other than our affiliates.
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The following are the estimated expenses of the issuance and distribution of the securities being registered under the registration statement of which this prospectus forms a part, all of which will be paid by us. With the exception of the SEC registration fee, all amounts are estimates and may change:
| SEC registration fee | $ | 2,092.65 | ||
| Printer fees and expenses | $ | 1,000.00 | ||
| Legal fees and expenses | $ | 50,000.00 | ||
| Accounting fees and expenses | $ | 50,000.00 | ||
| Miscellaneous | $ | 1,000.00 | ||
| Total | $ | 104,092.65 |
Certain legal matters concerning this prospectus will be passed upon for us by Sullivan & Worcester LLP, New York, New York. Certain legal matters with respect to the legality of the issuance of the securities offered by this prospectus will be passed upon for us by Wenger Vieli AG, Zurich, Switzerland.
The financial statements incorporated in this prospectus by reference to the Annual Report on Form 20-F for the year ended December 31, 2023 have been so incorporated in reliance on the report (which contains an explanatory paragraph relating to the Company’s ability to continue as a going concern as described in Note 1 to the financial statements) of PricewaterhouseCoopers AG, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
ENFORCEABILITY OF CIVIL LIABILITIES
We are incorporated under the laws of Switzerland and our registered office and domicile is located in Kloten (Zurich), Switzerland. Moreover, a majority of our directors and senior management are not residents of the United States, and all or a substantial portion of our assets are located outside the United States. As a result, it may not be possible for investors to effect service of process within the United States upon us or upon such persons or to enforce against them judgments obtained in U.S. courts, including judgments in actions predicated upon the civil liability provisions of the federal securities laws of the United States.
We have been advised by our Swiss counsel that there is doubt as to the enforceability in Switzerland of original actions, or in actions for enforcement of judgments of U.S. courts, of civil liabilities to the extent predicated upon the federal and state securities laws of the United States. Original actions against persons in Switzerland based solely upon the U.S. federal or state securities laws are governed, among other things, by the principles set forth in the Swiss Federal Act on International Private Law. This statute provides that the application of provisions of non-Swiss law by the courts in Switzerland shall be precluded if the result was incompatible with Swiss public policy. Also, mandatory provisions of Swiss law may be applicable regardless of any other law that would otherwise apply.
Switzerland and the United States do not have a treaty providing for reciprocal recognition and enforcement of judgments in civil and commercial matters. The recognition and enforcement of a judgment of the courts of the United States in Switzerland is governed by the principles set forth in the Swiss Federal Act on Private International Law. This statute provides in principle that a judgment rendered by a non-Swiss court may be enforced in Switzerland only if:
| ● | the non-Swiss court had jurisdiction pursuant to the Swiss Federal Act on Private International Law; |
| ● | the judgment of such non-Swiss court has become final or non-appealable by ordinary appeal; |
| ● | the judgment does not contravene Swiss public policy; |
| ● | the court procedures and the service of documents leading to the judgment were in accordance with the due process of law; and |
| ● | no proceeding involving the same position and the same subject matter was first brought in Switzerland, or adjudicated in Switzerland, or was earlier adjudicated in a third state and this decision is recognizable in Switzerland. |
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WHERE YOU CAN FIND ADDITIONAL INFORMATION
We have filed with the SEC a registration statement on Form F-3 under the Securities Act relating to this offering of our Common Shares. This prospectus does not contain all of the information contained in the registration statement. The rules and regulations of the SEC allow us to omit certain information from this prospectus that is included in the registration statement. Statements made in this prospectus concerning the contents of any contract, agreement or other document are summaries of all material information about the documents summarized, but are not complete descriptions of all terms of these documents. If we filed any of these documents as an exhibit to the registration statement, you may read the document itself for a complete description of its terms. Each statement in this prospectus relating to a document filed as an exhibit is qualified in all respects by the filed exhibit.
The SEC maintains an Internet website that contains reports and other information regarding issuers that file electronically with the SEC. Our filings with the SEC are also available to the public through the SEC’s website at http://www.sec.gov.
We are subject to the information reporting requirements of the Exchange Act that are applicable to foreign private issuers, and under those requirements we file reports with the SEC. Those other reports or other information may be inspected without charge at the locations described above. As a foreign private issuer, we will be exempt from the rules under the Exchange Act related to the furnishing and content of proxy statements, and our senior management, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file annual, quarterly and current reports and financial statements with the SEC as frequently or as promptly as United States companies whose securities are registered under the Exchange Act. However, we file with the SEC, within 120 days after the end of each fiscal year, or such applicable time as required by the SEC, an annual report on Form 20-F containing financial statements audited by an independent registered public accounting firm.
We maintain a corporate website at https://nlspharma.com. Information contained on, or that can be accessed through, our website does not constitute a part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The SEC allows us to “incorporate by reference” information into this prospectus, which means that we can disclose important information to you by referring you to other documents which we have filed or will file with the SEC. We are incorporating by reference in this prospectus the documents listed below and all amendments or supplements we may file to such documents, as well as any future filings we may make with the SEC on Form 20-F under the Exchange Act before the time that all of the securities offered by this prospectus have been sold or de-registered:
| ● | our Annual Report on Form 20-F for the year ended December 31, 2023, filed on May 15, 2024; |
| ● | our Reports on Form 6-K filed on May 22, 2024, May 24, 2024, May 28, 2024, May 31, 2024, June 6, 2024, June 11, 2024 (the first paragraph and the sections titled “Key Highlights”, and “Forward-Looking Statements” in the press release furnished as Exhibit 99.1 only), June 25, 2024, June 25, 2024, June 27, 2024, July 1, 2024, July 30, 2024 (the first eight paragraphs and the section titled “Safe Harbor Statement” in the press release furnished as Exhibit 99.1 only), August 14, 2024, August 15, 2024, August 26, 2024, September 13, 2024, September 17, 2024, September 19, 2024, September 25, 2024, October 1, 2024, October 8, 2024, October 10, 2024, October 11, 2024, October 11, 2024, October 15, 2024, October 18, 2024, and October 22, 2024; and |
| ● | the description of our Common Shares contained in our Registration Statement on Form 8-A filed with the SEC on January 28, 2021, as amended by Exhibit 2.1 to the 2023 Annual Report, and including any further amendment or report to be filed for the purpose of updating such description. |
As you read the above documents, you may find inconsistencies in information from one document to another. If you find inconsistencies between the documents and this prospectus, you should rely on the statements made in the most recent document. All information appearing in this prospectus is qualified in its entirety by the information and financial statements, including the notes thereto, contained in the documents incorporated by reference herein.
We will provide to each person, including any beneficial owner, to whom this prospectus is delivered, a copy of these filings, at no cost, upon written or oral request to us at the following address: The Circle 6, 8058 Zurich, Switzerland, Attention: Chief Financial Officer.
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Up to 2,747,437 Common Shares
PROSPECTUS
, 2024
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 6. Indemnification of Directors, Officers and Employees
Under Swiss law, a corporation may indemnify its directors or officers against losses and expenses (except for such losses and expenses arising from willful misconduct or negligence, although legal scholars advocate that at least gross negligence be required; however, some scholars also advocate that with any breach of duty, indemnification by the Company is not permissible), including attorney’s fees, judgments, fines and settlement amounts actually and reasonably incurred in a civil or criminal action, suit or proceeding by reason of having been the representative of, or serving at the request of, the corporation.
Subject to Swiss law, our articles of association provide for indemnification of the existing and former members of our board of directors, senior management, and their heirs, executors and administrators, against liabilities arising in connection with the performance of their duties in such capacity, and permit us to advance the expenses of defending any act, suit or proceeding to members of our board of directors and senior management.
In addition, under general principles of Swiss employment law, an employer may be required to indemnify an employee against losses and expenses incurred by such employee in the proper execution of his or her duties under the employment agreement with the Company.
We have entered into indemnification agreements with each of the members of our board of directors and senior management in the form to be filed as an exhibit to this registration statement upon the completion of this offering. We have also obtained directors’ and officers’ liability insurance to cover certain actions undertaken by our board of directors and senior management.
Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended, or the Securities Act, may be permitted to directors, officers and controlling persons of the Company, the Company has been advised that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable.
Item 7. Recent Sales of Unregistered Securities
Set forth below are the sales of all securities by the Company since October 2021, which were not registered under the Securities Act. The Company believes that each of such issuances was exempt from registration under the Securities Act in reliance on Sections 3(a)(9) and 4(a)(2) of the Securities Act and/or Regulation S under the Securities Act.
On September 16, 2024, we and a certain institutional investor entered into a warrant amendment agreement to amend those warrants issued by us to the investor, collectively, to purchase up to 172,837 Common Shares. The amendment makes certain adjustment to the definition of a "Fundamental Transaction" in such common warrants. In addition, we agreed to adjust the exercise price in such to CHF 0.80 (on a post-split basis), and agreed to issue to the investor pre-funded warrants to purchase up to 191,431 Common Shares.
On October 9, 2024, we and certain existing warrant holders entered into warrant amendment agreements to amend those warrants issued by us to such holders, collectively, to purchase up to 105,843 Common Shares issued to such holders. The amendment makes certain adjustment to the definition of a “Fundamental Transaction” in such common warrants. In addition, we agreed to adjust the exercise price of the common warrants to CHF 0.80 and issued to such holders pre-funded warrants to purchase up to 136,648 Common Shares.
On October 9, 2024, we entered into the Equity Purchase Agreement, with certain accredited investors. Pursuant to the terms of the Equity Purchase Agreement, we agreed to issue and sell to the investors, in a private placement offering, (i) 806,452 Common Shares and (ii) or common warrants to purchase 806,452 Common Shares, at a combined purchase price of $3.97, for aggregate gross proceeds of approximately $3.2 million.
II-1
On October 9, 2024, we entered into the Debt Purchase Agreement with an accredited investor, pursuant to which in exchange for the satisfaction of our debt in the aggregate amount of $4.0 million held by the investor, we agreed to issue 806,452 newly designated convertible preferred shares, at a purchase price of $4.96 (rounded). The preferred shares contain a conversion price of $4.96 per share. The transactions contemplated by the Debt Purchase Agreement closed on October 10, 2024.
On June 28, 2024, we entered into a securities purchase agreement for the issuance of 81,944 Common Shares at a purchase price of $9.60 per share. The offering closed on July 1, 2024. Investors also received unregistered warrants to purchase up to 81,944 Common Shares at an exercise price of $9.60 per share. These warrants are exercisable upon issuance and will expire five years from the date of issuance. The offering resulted in gross proceeds of $786,660. The net proceeds will be used for working capital and general corporate purposes.
H.C. Wainwright & Co., LLC served as the exclusive placement agent for the offering. We agreed to pay the placement agent a cash fee of 7.0% of the gross proceeds, a management fee of 1.0% of the gross proceeds, and $50,000 for accountable expenses. Additionally, we issued to the placement agent warrants to purchase up to 5,736 Common Shares at an exercise price of $12.00 per share. These warrants are exercisable from the date of issuance until five years from the commencement of sales in the offering.
On March 20, 2024, we entered into a securities purchase agreement providing for the issuance in a registered direct offering of 175,000 Common Shares at a purchase price of $10.00 per share that closed on March 22, 2024. In addition, the investors received unregistered warrants to purchase up to an aggregate of 87,500 Common Shares at an exercise of $10.00 per share in a concurrent private placement. The common warrants were immediately exercisable upon issuance and will expire five years following the date of issuance.
On December 13, 2022, we issued 143,678 Common Shares and pre-funded warrants to purchase 143,678 Common Shares at a purchase price of $34.80 per Common Share and $34.80 per pre-funded warrant, for aggregate gross proceeds of $10 million.
On September 30, 2022, we issued 129,870 Common Shares, at a purchase price of $30.80 per share, and warrants to purchase up to an aggregate of 64,935 Common Shares at an exercise of $28.00 per share. At the closing of the offering, our existing short-term notes, with an aggregate principal balance of $1.53 million plus all accrued interest, that were issued in August 2022, were automatically converted into 62,911 Common Shares and the holders received 7,696 Common Shares issuable upon the exercise of the short term note original warrants, at an exercise of $19.88 per share, which expire 24 months following their issuance on August 19, 2022, and warrants to purchase up to 31,455 Common Shares with an exercise price of $28.00, that are exercisable six months after their issuance and will expire five years following the date that the warrants are initially exercisable.
On April 25, 2022, we issued warrants to purchase up to an aggregate of 78,750 Common Shares at an exercise of $41.60 per share. The warrants will be exercisable six months after their issuance and will expire five and a half years following their issuance. Upon the exercise of the warrants, the Company will create the respective amount of Common Shares.
On October 19, 2021, we issued 32,830 of our Common Shares to YA II PN, LTD., a Cayman Islands exempt limited partnership, or YA, for aggregate gross proceeds of $2.5 million. In addition, on October 19, 2021, we issued 655 of our Common Shares to YA as partial consideration for its irrevocable commitment to purchase our Common Shares under the Standby Equity Distribution Agreement.
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Item 8. Exhibits and Financial Statement Schedules
Exhibits:
| * | Filed herewith. |
Financial Statement Schedules:
All financial statement schedules have been omitted because either they are not required, are not applicable or the information required therein is otherwise set forth in the Company’s financial statements and related notes thereto.
Item 9. Undertakings
| (a) | The undersigned Registrant hereby undertakes: |
| (1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
| i. | To include any prospectus required by section 10(a)(3) of the Securities Act; |
| ii. | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; |
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| iii. | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement |
| (2) | That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
| (3) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
| (4) | To file a post-effective amendment to the registration statement to include any financial statements required by Item 8.A. of Form 20-F at the start of any delayed offering or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Act need not be furnished, provided that the registrant includes in the prospectus, by means of a post-effective amendment, financial statements required pursuant to this paragraph (a)(4) and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements. Notwithstanding the foregoing, with respect to registration statements on Form F-3, a post-effective amendment need not be filed to include financial statements and information required by Section 10(a)(3) of the Act or Rule 3-19 of this chapter if such financial statements and information are contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the Form F-3. |
| (5) | That, for the purpose of determining liability under the Securities Act to any purchaser: |
| i. | If the registrant is relying on Rule 430B: |
| A. | Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and |
| B. | Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness of the date of the first contract or sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date and underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date; or |
| ii. | If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. |
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| (6) | That, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell securities to such purchaser: |
| i. | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
| ii. | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
| iii. | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
| iv. | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
| (b) | Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described in Item 6 hereof, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. |
| (c) | The undersigned registrant hereby undertakes that: |
| (1) | That for purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4), or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective. |
| i. | That for the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof |
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Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-3 and has duly caused this registration statement on Form F-3 to be signed on its behalf by the undersigned, thereunto duly authorized, in Zurich, Switzerland on October 23, 2024.
| NLS Pharmaceutics Ltd. | ||
| By: | /s/ Alexander Zwyer | |
| Alexander Zwyer | ||
Chief Executive Officer (Principal Executive Officer) | ||
POWER OF ATTORNEY
The undersigned officers and directors of NLS Pharmaceutics Ltd. hereby constitute and appoint Alexander Zwyer with full power of substitution, as our true and lawful attorney-in-fact and agent to take any actions to enable the Company to comply with the Securities Act, and any rules, regulations and requirements of the SEC, in connection with this registration statement on Form F-3, including the power and authority to sign for us in our names in the capacities indicated below any and all further amendments to this registration statement and any other registration statement filed pursuant to the provisions of Rule 462 under the Securities Act.
Pursuant to the requirements of the Securities Act, this registration statement on Form F-3 has been signed by the following persons in the capacities and on the dates indicated.
| Signature | Title | Date | ||
| /s/ Alexander Zwyer | Chief Executive Officer and Director | October 23, 2024 | ||
| Alexander Zwyer | (Principal Executive Officer) | |||
| /s/ Nicole Fernandez | Chief Financial Officer and Chief Operating Officer | October 23, 2024 | ||
| Nicole Fernandez | (Principal Financial and Accounting Officer) | |||
| /s/ Ronald Hafner | Chairman of the Board of Directors | October 23, 2024 | ||
| Ronald Hafner | ||||
| /s/ Florence Allouche Aknin | Director | October 23, 2024 | ||
| Florence Allouche Aknin | ||||
| /s/ Claudio L. A. Bassetti | Director | October 23, 2024 | ||
| Claudio L. A. Bassetti | ||||
| /s/ Gian-Marco Rinaldi de la Cruz | Director | October 23, 2024 | ||
| Gian-Marco Rinaldi de la Cruz | ||||
| /s/ Audrey Greenberg | Director | October 23, 2024 | ||
| Audrey Greenberg | ||||
| /s/ Olivier Samuel | Director | October 23, 2024 | ||
| Olivier Samuel |
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SIGNATURE OF AUTHORIZED REPRESENTATIVE IN THE UNITED STATES
Pursuant to the Securities Act of 1933, as amended, the undersigned, Puglisi & Associates, the duly authorized representative in the United States of NLS Pharmaceutics Ltd., has signed this registration statement on October 23, 2024.
| Puglisi & Associates | ||
| By: | /s/ Donald J. Puglisi | |
| Name: | Donald J. Puglisi | |
| Title: | Managing Director | |
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