October 5, 2018
David Rosa
Chief Executive Officer
NeuroOne Medical Technologies Corporation
10006 Liatris Lane
Eden Prairie, MN 55347
Re: NeuroOne Medical Technologies Corporation
Registration Statement on Form S-1
Filed September 10, 2018
File No. 333-227265
Dear Mr. Rosa:
We have reviewed your registration statement and have the following
comments. In
some of our comments, we may ask you to provide us with information so we may
better
understand your disclosure.
Please respond to this letter by amending your registration statement
and providing the
requested information. If you do not believe our comments apply to your facts
and
circumstances or do not believe an amendment is appropriate, please tell us why
in your
response.
After reviewing any amendment to your registration statement and the
information you
provide in response to these comments, we may have additional comments.
Form S-1 Filed September 10, 2018
About Us, page 1
1. If you choose to highlight that you are developing technology to address
the conditions
disclosed here, given your disclosure on page 34 please also disclose
that addressing
specific disclosed conditions will require that your technology detect
single neuron brain
activity, which page 33 indicates has been suggested in limited clinical
testing.
David Rosa
FirstName Medical Technologies Corporation
NeuroOne LastNameDavid Rosa
Comapany 2018
October 5, NameNeuroOne Medical Technologies Corporation
October 5, 2018 Page 2
Page 2
FirstName LastName
Risk Factors, page 2
2. Please provide us your analysis of whether the promotional activity
mentioned in your
Form 8-K filed August 24, 2018 exposes you to material risks which
should be disclosed
in this prospectus.
Our future success depends on our ability . . ., page 17
3. We note your reference to your "scientific and physician advisory
board members." In an
appropriate section of your document, please clarify the nature of
these boards and their
relation to your organizational structure. Also, ensure your
disclosure addresses the
advisory board discussed in your Form 8-K filed September 27, 2018,
including how that
board's focus impacts your current operations.
Selling Stockholders, page 29
4. We note your disclosure in the first sentence of the second paragraph
regarding selling
stockholders who have had specified relationships with you or your
affiliates in the past
three years, but the table does not appear to present this
information. Please tell us
whether any of the selling securityholders have had those specified
relationships and, if
so, disclose the nature of those relationships and the identity of the
natural persons who
maintain beneficial ownership of securities held by entities with such
relationships.
5. Please disclose the transaction in which the selling security holders
acquired the offered
shares. Include the date of the transaction and the amount the
security holder paid for the
offered securities.
Description of Securities to be Registered, page 31
6. Please revise to provide all information required by Regulation S-K
Item 202(c) regarding
the warrants overlying the securities offered.
Corporate Overview and History of NeuroOne, page 32
7. We note your disclosure in the the second paragraph of page 33 that
pre-clinical tests have
demonstrated specified capabilities in your technology. Given this,
please revise to clarify
what is meant by your disclosure that your "technology remains in
product development
for all of the therapeutic modalities." Your revised disclosure should
clearly identify the
current stage of development regarding the products you intend to
produce and what
capabilities have been demonstrated by objective, statistically
significant data.
Our Strategy, page 36
8. We note your disclosure in the first bullet point indicating your
expected timeframe for
submitting a premarket notification to the FDA. In an appropriate
section of your
prospectus, please disclose the expected length of time between your
submission of the
David Rosa
FirstName Medical Technologies Corporation
NeuroOne LastNameDavid Rosa
Comapany 2018
October 5, NameNeuroOne Medical Technologies Corporation
October 5, 2018 Page 3
Page 3
FirstName LastName
notification and your ability to market your intended products. Ensure
your disclosure
clearly identifies your anticipated timeline regarding obtaining
required regulatory
clearances.
9. Revise to clarify the development and testing you must perform before
submitting your
510(k) submission to the FDA. For example, if you have not yet
developed a product that
can serve as the basis of this submission, your disclosure should
indicate the current status
of product development, what obstacles remain to developing the
product, what resources
are required to complete development and when you anticipate such
product development
will be completed. Provide similar disclosure regarding any required
testing.
Our Technology, page 37
10. Please revise your disclosure to clarify your references to
"scale-able technology," "ultra-
thin electrodes" and "higher density contacts." Your disclosure should
explain what these
terms mean in context and how they relate to your intended products.
11. Revise to clarify the significance of the graphic presented. Your
disclosure should clearly
explain which pictures represent your intended products and what the
significance of each
picture is to your intended product.
Clinical Experience, Future Development and Clinical Trial Plans, page 38
12. Given your disclosure regarding your regulation by the FDA, please
tell us the authority
on which you rely to discuss your technology's safety and efficacy, as
mentioned in the
first paragraph.
13. Revise the disclosure in your chart to clarify what is meant by
"[d]esign freeze complete"
and "[i]n development" in the second column and briefly explain the
various tests
mentioned in the third column. Also, please ensure your disclosure
regarding timeframe
expectations is updated.
Research and Development, page 41
14. Reconcile the number of employees as disclosed here with disclosure on
page 50. If
appropriate, please clarify the nature of your relationships with the
disclosed individuals
performing research and development.
Employment Agreements, page 72
15. Please file the agreement mentioned in the last sentence of the first
paragraph.
David Rosa
FirstName Medical Technologies Corporation
NeuroOne LastNameDavid Rosa
Comapany 2018
October 5, NameNeuroOne Medical Technologies Corporation
October 5, 2018 Page 4
Page 4
FirstName LastName
Security Ownership of Certain Beneficial Owners and Management, page 80
16. Please identify the natural persons who exercise the sole or shared
voting and/or
dispositive powers with respect to the shares owned by the entities
listed in your table.
For example, we note footnotes 4 and 6. Also, tell us why this table
does not address the
securities owned by Chromium 24, LLC, as discussed on page 82.
Note 1 - Organization and Nature of Operations
Merger of NeuroOne, Inc. and NeuroOne LLC, page F-8
17. We note that NeuroOne LLC was merged into NeuroOne, Inc. on October
27, 2016 in a
transaction accounted for as an asset acquisition under ASC 805 and
that you concluded
that NeuroOne LLC is the predecessor entity in this transaction.
Please explain to us why
you are presenting the successor financial information for periods
prior to the date of the
merger transaction. Cite the authoritative guidance upon which you are
relying.
Note 3 - Summary of Significant Accounting Policies
Fair Value of Financial Instruments, page F-9
18. Please revise to disclose the fair value of your common shares at each
period end as it is
a significant unobservable input underlying the level 3 fair value
measurements. Refer
to ASC 820-10-50-2bbb.
Note 6 Accrued expenses, page F-15
19. We note from your disclosure on page F-15 and F-34 that as of December
31, 2017 and
June 30, 2018 you accrued $600,339 and $1,118,872 for services,
respectively. Given the
significance of the amounts in relations to your total accrued
expenses, please revise the
notes to briefly describe the related services. In addition, revise
MD&A to discuss the
impact of these accruals on your results of operations in each
reported period, as well as
any impact on your future liquidity position. Refer to Item 303(A)(1)
and 303(B)(1) of
Regulation S-K.
Note 7 - Short-Term Promissory Notes and Unsecured Loan
Short-Term Promissory Notes, page F-15
20. You disclose here and throughout filing that the fair value of your
common stock used in
determining the fair value of warrants issued was based on a separate
independent third-
party valuation analysis. Please revise to clarify the nature and
extent of your reliance on
the independent third-party valuation. Also, refer to Question 141.02
of our Compliance
and Disclosure Interpretations on Securities Act Sections which
provides guidance on the
use of third-party experts in connection with the preparation of a
Securities Act
registration statement.
David Rosa
NeuroOne Medical Technologies Corporation
October 5, 2018
Page 5
Note 10 - Stock-Based Compensation, page F-20
21. During the year ended December 31, 2017 you granted directors and
consultants 365,716
stock options with weighted average exercise prices of $0.04 and issued
215,453 restricted
common shares with a fair value of $0.03. You recorded approximately
$77,000 of stock-
based compensation expense and we see on page F-42 that you had no
remaining
unrecognized compensation expense. Please address the following:
Tell us the fair value of your common shares and clarify how it was
determined as of
each stock option and restricted stock grant date.
Clarify for us the vesting periods for the stock options granted.
Explain to us why the estimated fair value of your common stock as
of December 31,
2017 of $2.52 per share is significantly higher than the weighted
average exercise
prices of the stock options and the fair value of the restricted
stock granted.
Item 15. Recent Sales of Unregistered Securities, page II-2
22. Please revise to provide the information Regulation S-K Item 701
requires concerning the
transaction disclosed in your Form 8-K filed August 24, 2018 regarding
your agreement
with JLS Ventures, LLC.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
Refer to Rules 460 and 461 regarding requests for acceleration. Please
allow adequate
time for us to review any amendment prior to the requested effective date of
the registration
statement.
You may contact Eric Atallah at 202-551-3663 or Kevin Kuhar, Accounting
Branch
Chief, at 202-551-3662 if you have questions regarding comments on the
financial statements
and related matters. Please contact Caleb French at 202-551-6947 or Amanda
Ravitz, Assistant
Director, at 202-551-3528 with any other questions.
Sincerely,
FirstName LastNameDavid Rosa
Division of Corporation
Finance
Comapany NameNeuroOne Medical Technologies Corporation
Office of Electronics and
Machinery
October 5, 2018 Page 5
cc: Jeff Cahlon, Esq.
FirstName LastName