Neuphoria Therapeutics Inc

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 1. The Company and Basis of Presentation

Neuphoria Therapeutics Inc. (“the Company”) is a public company incorporated in Delaware. The Company is a clinical-stage biotechnology company dedicated to developing therapies that address the complex needs of individuals affected by neuropsychiatric disorders. Neuphoria is advancing the lead drug candidate, BNC210, an oral, proprietary, selective negative allosteric modulator of the α7 nicotinic acetylcholine receptor, for the acute, “as needed” treatment of social anxiety disorder ("SAD") and for chronic treatment of post-traumatic stress disorder ("PTSD"). BNC210 is a first-of-its-kind, well tolerated, broad spectrum anti-anxiety experimental therapeutic, designed to restore neurotransmitter balance in relevant brain areas, providing rapid relief from stress and anxiety symptoms without the common pitfalls of sedation, cognitive impairment, or addiction.

In addition, the Company has a strategic partnership with Merck & Co., Inc. (known as "MSD" outside the United States and Canada) with two drugs in early-stage clinical trials for the treatment of cognitive deficits in Alzheimer’s disease and other central nervous system conditions. Our pipeline also includes the α7 nicotinic acetylcholine receptor next generation and the Kv3.1/3.2 preclinical programs, both in the lead optimization development stage.

On October 1, 2024, Bionomics Limited ("Bionomics") announced its intention to redomicile from Australia to the United States via a proposed scheme of arrangement under Australian law between Bionomics and its shareholders (the “Scheme”). Implementation of the Scheme was subject to approval of Bionomics’ shareholders as well as Australian regulatory and court approvals. Bionomics’ ordinary shares, in the form of American Depositary Shares (“ADSs”), traded in the United States since listing on the Nasdaq Global Market (Nasdaq") in December 2021 until December 23, 2024. The Scheme was approved by Bionomics shareholders and an Australian court in December 2024. On December 23, 2024, shareholders of Bionomics received a proportionate number of shares of common stock in Neuphoria for purposes of the redomiciliation. Neuphoria is the successor issuer to Bionomics and shares of Neuphoria’s common stock commenced trading on Nasdaq on December 24, 2024. All of the issued and outstanding ordinary shares of Bionomics were exchanged for newly issued shares of common stock of Neuphoria, on the basis ofone share of common stock for every 2,160 ordinary share. Shareholders of Bionomics’ ADSs (each of which represented 180 ordinary shares) were exchanged forone share of common stock for every 12 ADS held. In addition, as a result of the redomiciliation, Neuphoria issued certain options to acquire shares of common stock in Neuphoria to holders of options to acquire shares in Bionomics (“Bionomics Options”) in exchange for their Bionomics Options and issued a warrant to purchase 1,054,381 shares of common stock in Neuphoria to an institutional investor that held a warrant to purchase 12,652,572 ADSs of Bionomics (“Bionomics Warrant”), in exchange for the Bionomics Warrant.

The issued and outstanding shares of Neuphoria’s common stock as shown in this report have been adjusted in the condensed consolidated financial statements to reflect the redomiciliation as if it had occurred on June 30, 2023.

Details of the Company’s entity structure at the end of the reporting period are as follows (post-redomiciliation):

Liquidity and Going Concern

As of December 31, 2024, the Company had working capital of $2.3 million, an accumulated deficit of $180.7 million, and cash and cash equivalents of $4.3 million. The Company has not generated any product revenues and has not achieved profitable operations. There is no assurance that profitable operations will ever be achieved, and, if achieved, could be sustained on a continuing basis. In addition, development activities, clinical and non-clinical testing, and commercialization of the Company’s products will require significant additional financing.

The Company is subject to a number of risks similar to other life science companies, including, but not limited to, risks related to the successful discovery, development, and commercialization of product candidates, raising additional capital, development of competing drugs and therapies, protection of proprietary technology, and market acceptance of the Company’s products. As a result of these and other factors and the related uncertainties, there can be no assurance of the Company’s future success.

In accordance with ASC 205-40, Going Concern, the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date these condensed consolidated financial statements are issued. The Company incurred net losses of $1.9 million and $2.7 million for the three and six months ended December 31, 2024 and $15.5 million for the year ended June 30, 2024. The Company also used $7.8 million of cash for operating activities during the six months ended December 31, 2024. Based upon the Company’s current operating plans, the Company believes that its existing cash and cash equivalents will be sufficient to continue funding its development activities into late in the fourth quarter of fiscal year 2025, which is less than twelve months from the date these condensed consolidated financial statements are issued. Accordingly, based on its recurring losses from operations incurred since inception, the expectation of continued operating losses, and the need to raise additional capital to finance its future operations, the Company determined that there is substantial doubt about the Company’s ability to continue as a going concern within twelve months of the issuance date of these financial statements. See Note 17 for more information related to potential mitigating factors.

The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty and assumes the Company will continue as a going concern through the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business. The Company plans to address this condition through the sale of common stock in public offerings and/or private placements, debt financings, or through other capital sources, including collaborations with other companies or other strategic transactions.

Although the Company has been successful in raising capital in the past, there is no assurance that it will be successful in obtaining such additional financing on terms acceptable to the Company, if at all, nor is it considered probable under the accounting standards. If the Company is unable to obtain sufficient funding on acceptable terms, it could be forced to delay, reduce or eliminate some or all its research and development programs or commercialization activities, which could materially adversely affect its business prospects or its ability to continue operations.

Basis of Presentation

In December 2024, a Scheme was approved by Bionomics shareholders and an Australian court, and, on December 23, 2024, shareholders of Bionomics received a proportionate number of shares of common stock in Neuphoria for purposes of the redomiciliation and Bionomics became a wholly-owned subsidiary of Neuphoria, which is the new parent company of Bionomics. The historical financial statements of Bionomics became the historical financial statements of the combined company upon consummation of the redomiciliation. As a result, the financial statements included in this report reflect (i) the historical operating results of Bionomics and subsidiaries prior to the formation of Neuphoria on July 1, 2024; (ii) the combined results of the Company, Bionomics, and subsidiaries following the formation of Neuphoria; and (iii) the Company’s equity structure for all periods presented, including adjusting the issued and outstanding shares of common stock to reflect the redomiciliation as if it had occurred on June 30, 2023.

The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP” or “GAAP”) and include the accounts of our wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

The condensed consolidated balance sheet as of June 30, 2024 was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The accompanying condensed consolidated financial statements, as of December 31, 2024 and for the three and six months ended December 31, 2024, are unaudited and have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The Company believes that the disclosures are adequate to make the information presented not misleading.

These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and the notes thereto for the year ended June 30, 2024 included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2024 filed with the SEC on September 30, 2024. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, as necessary for the fair statement of the Company’s financial position as of December 31, 2024, results of its operations for the three and six months ended December 31, 2024, shareholders’ equity for the three and six months ended December 31, 2024, and cash flows for the six months ended December 31, 2024, have been made. The results of operations for the three and six months ended December 31, 2024 are not necessarily indicative of the results of operations to be expected for the year ending June 30, 2025.

The Company has historically been classified as a foreign private issuer (“FPI”); however, as of December 31, 2023 (the "Measurement Date") the Company determined that it no longer satisfied the criteria to be considered an FPI. As such, beginning on July 1, 2024, the Company was required to begin utilizing the SEC’s domestic reporting forms and apply U.S. GAAP as its accounting framework. There were no material adjustments required as a result of this adjustment to retrospectively apply U.S. GAAP to the accompanying condensed consolidated financial statements. Another requirement of utilizing the SEC’s domestic reporting forms is a requirement to use the U.S. dollar as the reporting currency. These consolidated financial statements reflect the change in reporting currency to the U.S. dollar applied retrospectively. References to “$” are U.S dollars and references to “A$” are to Australian dollars.

The presentation of shareholders' equity in the consolidated balance sheets at June 30, 2023, as previously reported under International Financial Reporting Standards ("IFRS") was reclassified to comply with the presentation under U.S. GAAP.

Note 2. Summary of Significant Accounting Policies

Use of Estimates

The preparation of the Company’s condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosure of revenue, expenses, and certain assets and liabilities at the balance sheet date. Such estimates include the performance obligations under the Company’s collaboration agreements, the collectability of receivables, impairment evaluation for goodwill and intangible assets, and the fair values of contingent consideration and warrants. Actual results may differ from such estimates.

Summary of Significant Accounting Policies

There were no changes to significant accounting policies during the six months ended December 31, 2024, as compared to those identified in the fiscal 2024 Annual Report on Form 10-K.

Note 3. Fair Value Measurement

The Company measures and reports certain financial instruments as assets and liabilities at fair value on a recurring basis. The following tables set forth the fair value of the Company’s liabilities at fair value on a recurring basis based on the three-tier fair value hierarchy:

The Company has no financial assets that are measured at fair value. The liabilities measured at fair value at December 31, 2024 and June 30, 2024 are contingent consideration and the accompanying warrant liability (also referred to herein as the Bionomics Warrant). The value of financial assets and other financial liabilities approximate their fair value. The following table gives information about how the fair value of the financial liability is determined.

The accompanying warrants liability relates to the Company’s issuance of accompanying warrants in conjunction with a Private Placement in June 2024. The fair value of the accompanying warrants liability was based on valuations that required inputs that were both significant to the fair value measurement and unobservable. This approach resulted in a classification of the accompanying warrants liability as Level 3 of the fair value hierarchy. See Note 15 for additional disclosure related to contingent consideration.

The following table summarizes changes in the fair value of the contingent consideration and the accompanying warrants liability, each for which each fair value was determined by Level 3 inputs:

The Company evaluates transfers between levels at the end of each reporting period. There were no transfers between levels during the periods presented.

Note 4. Accounts Receivable, Non-trade

Accounts receivable, non-trade consist of the following:

Note 5. Leases

In June 2021, the Company entered into a 5-year lease agreement (the “Greenhill Lease”) for its Australian facility located in Dulwich, South Australia. The initial term of the lease expires in May 2026.

The Greenhill Lease requires monthly lease payments that are subject to annual increases of 3% throughout the lease term. The lease also includes two renewal options, at the election of the Company, to renew or extend the lease for additional terms ofone year each. These optional periods have not been considered in the determination of the right-of-use assets or lease liabilities associated with these leases as the Company did not consider it reasonably certain it would exercise the options. Variable lease expense for the premises primarily consists of common area maintenance and other operating costs.

The following table summarizes the Company’s recognition of the Greenhill Lease including the remaining lease payments through the end of the expected lease term:

The discount rate associated with the Company’s operating lease is 3.5% and the weighted average remaining lease term is approximately 1.4 years.

The following table summarizes the effect of lease costs in the Company’s condensed consolidated statements of operations and other comprehensive income (loss):

Note 6. Goodwill

The following table summarizes changes in the carrying value of goodwill for thesix months ended December 31, 2024 and 2023:

The Company reviews goodwill for impairment at the reporting unit on an annual basis during the fourth quarter, and when events or changes in circumstances indicate that a reduction in the carrying value may not be recoverable. The reporting unit has been identified as the drug development business unit. There were no impairment indicators identified by the Company at December 31, 2024.

Note 7. Intangible Assets

Intellectual Property

The acquired intellectual property relates to cancer stem cell technology and is carried at its cost on the date of acquisition, less accumulated amortization and impairment charges. There were no impairment indicators identified by the Company at December 31, 2024.

As of June 30, 2024, the KV1.3 compound, VDA compound, MultiCore technology intangible assets have been derecognized as no future economic benefits are expected from their use or disposition.

Acquired intellectual property with a finite life is recognized as an asset at cost and amortized on a straight line basis over its estimated useful life of 20 years. There is currently no internally generated intellectual property that has been capitalized.

Note 8. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following:

Note 9. Share Based Compensation

In December 2024, Neuphoria adopted its 2024 Equity Incentive Plan (“2024 Plan”). The maximum number of shares of common stock of the Company that are available for issuance under the 2024 Plan is 1,000,000 shares. On December 24, 2024, our predecessor entity, Bionomics Limited effected a redomiciliation through a scheme of arrangement under Australian law whereby and following which Neuphoria became the successor entity to Bionomics. As a result of the redomiciliation, Neuphoria issued certain options to acquire shares of common stock in Neuphoria to holders of options to acquire shares in Bionomics (“Bionomics Options”) in exchange for their Bionomics Options. The structure of equity awards is under the active review of the Nomination and Remuneration Committee to ensure it meets good corporate practice for a company of our size, nature and company lifecycle. At December 31, 2024 there were 949,146 shares available for grant under the 2024 Plan.

Equity awards for executives and employees were previously provided by a combination of equity plans that may include the:

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Employee Share Plan (the “A$1,000 Plan”);

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Employee Share Option Plan (“ESOP”); and

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Employee Equity Plan (“EEP”).

Participation in these plans was at our board of directors’ discretion and no individual has an ongoing contractual right to participate in a plan or to receive any guaranteed benefits. For key appointments, an initial allocation of equity was offered as a component of the recipients initial employment agreement.

The following describes the material terms of each of the historic plans.

Employee Share Plan

The objective of the A$1,000 Plan is to assist Management in the attraction and retention of employees, and to provide encouragement to become shareholders. An annual allocation of up to A$1,000 of shares may be granted and taxed on a concessional basis. No shares were issued to employees under the A$1,000 Plan during the six months ended December 31 2024 and 2023, respectively.

The Bionomics Employee Equity Plan and Bionomics Employee Share Option Plan

The EEP replaced the ESOP at the Annual General Meeting held December 2, 2021.

The EEP was last amended on October 31, 2021 to provide the Company with increased flexibility to settle EEP awards offered or granted to non-Australian employees and directors by enabling it to offer and grant EEP awards that may be settled in American Depository Shares (“ADS”) (at a number of ADSs that represents the appropriate number of Ordinary Shares offered or granted under the award). In addition, the amendment permits the Company to (i) determine any monetary amounts and accept payments related to the EEP or awards issued thereunder in United States dollars (or any other currency the Board deems acceptable), (ii) impose terms and conditions on the EEP or awards issued thereunder to comply with the securities and tax laws of the United States (or any other jurisdiction the Board deems appropriate), and (iii) take any other steps the Board deems necessary or desirable to settle EEP awards in ADSs.

Share-based compensation benefits have been provided to employees via the Employee Equity Plan, with the exception of share options issued to the Executive Chairman and the Chief Executive Officer which were each approved by shareholders at the General Meeting held in February 2023.

Staff eligible to participate in the plan are those who have been a full-time or part-time employee of the Company for a period of not less than six months or are members of the Board of Directors. Options are granted under the plan for no consideration and vest equally over five years, or when vesting conditions are achieved, unless they are bonus options which vest immediately. The amounts disclosed as remuneration relating to options are the assessed fair values at grant date of those options allocated equally over the period from grant date to vesting date.

The following table summarizes employee and non-employee share option activity for the six months ended December 31, 2024:

(1) The rollforward of the Number of Options has been corrected to reflect the proper number of lapsed instruments incurred during the six months ended December 31, 2024 as compared to the information previously reported for the three months ended September 30, 2024. There was no impact to share-based compensation expense due to this corrected disclosure.

As of December 31, 2024, there was approximately $0.1 million of unrecognized compensation cost related to unvested employee share option awards outstanding, which is expected to be recognized as expense over a weighted average period of 0.87 years.

In determining the fair value of the share-based awards, the Company uses the Black-Scholes option-pricing model and assumptions discussed below. Each of these inputs is subjective and generally requires significant judgment to determine.

During the three months ended December 31, 2024 and 2023, the Company recognized total share-based compensation expense of less than $0.1 million and $0.7 million, respectively.

During the six months ended December 31, 2024 and 2023, the Company recognized total share-based compensation expense of less than $0.1 million and $0.9 million, respectively.

Substantially all of the share-based compensation expense was recorded as general and administrative expense in all periods. There wereno equity awards issued during thesix months ended December 31, 2024.

Note 10. Warrants

On December 24, 2024, Neuphoria, Bionomics, an institutional investor entered into a warrant exchange agreement (“Warrant Exchange Agreement”), pursuant to which the institutional investor’s cash exercise warrant issued by Bionomics on June 3, 2024, exercisable to purchase up to 12,652,572 ADSs of Bionomics, was cancelled and Neuphoria issued a warrant exercisable for up to 1,054,381 shares of common stock of Neuphoria at $11.88 per share (the “Warrant”) to the institutional investor. Under the terms of the Warrant, the institutional investor may not beneficially own more than 9.99% of Neuphoria’s outstanding shares of common stock at any time. The Warrant is immediately exercisable and remains exercisable until June 2, 2029 unless earlier fully exercised.

The following table summarizes warrant activity for the six months ended December 31, 2024:

The classification, expiration date, and exercise price of individual warrants at December 31, 2024 are as follows:

1,054,381 warrants were vested and exercisable at December 31, 2024.

The weighted average remaining contractual life of the accompanying warrants outstanding at December 31, 2024 is 4.42 years.

Note 11. Capital stock

Under the Certificate of Incorporation, Neuphoria is authorized to issue up to 30,000,000 shares of common stock and

3,000,000 shares of preferred stock, par value $0.00001 per share.

Common Stock

Voting Rights. The holders of our common stock are entitled to one vote per share on all matters on which stockholders are generally entitled to vote; provided, however, that, except as otherwise required by law, holders of common stock, as such, are not entitled to vote on any amendment to the Certificate of Incorporation that relates solely to the terms of one or more outstanding series of preferred stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to the Certificate of Incorporation. Holders of our common stock do not have cumulative voting rights in the election of directors. Accordingly, the holders of a majority of the combined voting power of our common stock could, if they so choose, elect all the directors.

Dividends. Subject to the rights of the holders of any outstanding series of preferred stock, holders of common stock are entitled to receive any dividends to the extent permitted by law when, as and if declared by our board of directors.

Liquidation. Upon the dissolution, liquidation, or winding up of Neuphoria, subject to the rights of the holders of any outstanding series of preferred stock, the holders of shares of common stock are entitled to receive the assets of Neuphoria available for distribution to its stockholders ratably in proportion to the number of shares held by them.

During the six months ended December 31, 2024, the Company issued 2,207,000 ADS' to Armistice Capital upon exercise of pre-funded warrants in October 2024.

Authorized but Unissued Preferred Stock

Unless required by law or by any stock exchange on which our common stock may be listed, the authorized shares of preferred stock will be available for issuance without further action by our stockholders. Delaware law does not require stockholder approval for any issuance of authorized shares. However, the listing requirements of Nasdaq, which apply as long as our common stock is listed on Nasdaq, require stockholder approval of certain issuances equal to or exceeding 20% of the combined voting power of our common stock. These additional shares may be used for a variety of corporate purposes, including future public offerings to raise additional capital, acquisitions, and employee benefit plans.

Our Certificate of Incorporation authorizes our board of directors to establish the number of shares to be included in each series of preferred stock, and to fix the designation, powers, preferences, relative participation, optional or other rights, and the qualifications, limitations or restrictions, of the shares of each series of preferred stock. Our board of directors is also able to increase or decrease the number of authorized shares of any series of preferred stock (but not below the number of shares of that series of preferred stock then outstanding) without any further vote or action by the stockholders.

Note 12. Income Taxes

For interim financial reporting, the Company estimates its annual effective tax rate based on the projected income for its entire fiscal year and records a provision or benefit for income taxes on a quarterly basis based on the estimated annual effective income tax rate. Our effective tax rate ("ETR") from continuing operations was 6.33% for the quarter ended December 31, 2024 and 0.56% for the quarter ended December 31, 2023, respectively. For the three month period ending December 31, 2024 and 2023, the Company recognized a tax provision of $11,609 and a tax benefit of $34,794, respectively. For the six month period ending December 31, 2024 and December 31, 2023, the Company recognized a tax benefit of $120,578 and $69,587, respectively.

Note 13. Loss per Share

The following potential shares of common stock are anti-dilutive and are therefore excluded from the weighted average number of ordinary shares for the purposes of diluted loss per share.

All share and earnings per share amounts presented above reflect the impact of the redomiciliation as if it had taken effect on July 1, 2023.

Note 14. Related Party Transactions

Danforth Advisors

In July 2021, we entered into a consulting agreement with Danforth Advisors LLC (“Danforth”) to provide consulting services to the Company. The Danforth agreement was amended in May 2023, and further amended in August 2023. Pursuant to the agreement, Danforth provides us with the Chief Financial Officer services of Mr. Cunningham in exchange for fees payable to Danforth. The Danforth agreement will continue until such time as either party to it has given notice of termination pursuant thereto with cause upon 30 days prior written notice to the other party; or without cause upon 60 days prior written notice.

WG Partners LLP

In December 2023, we entered into an engagement letter with WG Partners LLP to provide financial advisory services to Bionomics, our predecessor entity. David Wilson, a director of Neuphoria, is the Chairman and Chief Executive Officer of WG Partners. Under the agreement, Neuphoria must pay to WG Partners a monthly fee of $15,000 and commission of up to 5% of any fundraising proceeds attributable to this relationship. The agreement will continue until such time as a party gives 30 days prior written notice of termination to the other party. During thethree and six months ended December 31, 2024, we paid WG Partners $59,841 and $79,206, respectively, for its services under terms and conditions that are on an arms-length basis.

Note 15. Contingent Consideration

As a result of the acquisition of Eclipse Therapeutic, Inc (“Eclipse”) during the year ended June 30, 2013, the Company determines and recognizes at each reporting date the fair value of the additional consideration that may be payable to Eclipse security holders due to potential royalty payments based on achieving late-stage development success or partnering outcomes based on Eclipse assets. Such potential earn-out payments are recorded at fair value and include several significant estimates including adjusted revenue projections and expenses, probability of such projections, and a suitable discount rate to calculate fair value.

Due to changes in the projected inputs associated with the timing and quantum of expected cash outflows, which are in USD dollars, the liability decreased by approximately $0.2 million during the six months ended December 31, 2024 (see Note 3). Inputs used are based on the anticipated amounts and timing of potential milestone and royalty payments from licensing agreement with Carina Biotech Pty Ltd (“Carina”).

The guidance in ASC 805, Business Combinations, requires an acquirer to recognize contingent consideration obligations as of the acquisition date at fair value as part of the consideration transferred in exchange for the acquired business. Subsequent changes in the fair value are recognized in the Condensed Consolidated Statement of Operations and Other Comprehensive Income (Loss) (see Note 3).

Note 16. Commitments and Contingencies

Ironwood Pharmaceuticals, Inc.

In January 2012, the Company entered into a research and license agreement with Ironwood Pharmaceuticals, Inc. (“Ironwood”) pursuant to which Ironwood was granted worldwide development and commercialization rights for BNC210. In November 2014, the parties mutually agreed to terminate this license agreement, reverting all rights to BNC210 back to the Company. The sole obligation to Ironwood is to pay Ironwood low to mid-single digit royalties on the net sales of BNC210, if commercialized. It is not practicable to estimate the future payments of any such royalties that may arise due to the stage of development of BNC210.

Severance Obligation

The Company has a contingent liability in relation to the employment agreement with Dr. Spyros Papapetropoulos for severance pay of $787,500.

Depositary Agreement with Citibank

In connection with the Company’s redomiciliation though a scheme of arrangement under Part 5.1 of the Australian Corporations Act, effective December 23, 2024, Bionomics terminated its American Depositary Receipt program with Citibank, N.A., which acted as the depositary for the American Depositary Shares previously issued and listed on the Nasdaq Stock Market prior to the redomiciliation. In connection with the redomiciliation, all of the issued and outstanding ADSs were exchanged for shares of common stock, and simultaneously therewith, the Depositary Agreement between the Company and Citibank was terminated, effective immediately, pursuant to and in accordance with the terms of the depositary agreement. In conjunction with termination of the Citibank Depository Agreement, the Company paid and recognized a termination fee of approximately $0.4 million in December 2024. Beginning on December 24, 2024, ComputerShare Trust Company, N.A. began to serve as the Company’s U.S stock transfer agent.

Note 17. Subsequent Events

The Company has evaluated subsequent events through February 14, 2025 and has concluded that no events or transactions have occurred that require disclosure in the accompanying condensed consolidated financial statements, except as follows:

Correspondence from the Listing Qualifications Department of The Nasdaq Stock Market LLC

On January 10, 2025, the Company received a letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC stating that the Company had regained compliance with Nasdaq Listing Rule 5450(a)(1) (the “Minimum Bid Price Requirement”) by maintaining a minimum closing bid price of the Company’s common stock (the “Common Stock”) of $1.00 or greater per share for ten (10) consecutive business days, from December 24, 2024 through January 8, 2025, and that the Minimum Bid Price Requirement matter is now closed.

Termination of Registration of Bionomics Ordinary Shares

In connection with certain securities issuances and offerings that were previously registered and declared effective by the SEC, the Company filed a Form 15 to terminate the registration (and the registration statements related thereto) under the Securities Exchange Act of 1934, as amended, of Bionomics’ ordinary shares and to suspend its reporting obligations under Sections 13 and 15(d) of the Exchange Act. Thereafter, the Company filed registration statements with the SEC for its previously issued and such future securities issuances, as applicable, under the following registration statements, which were declared effective on the dates noted below, respectively:

Registration Statement on Form S-3 (universal shelf registration statement), File No. 333-283306, filed November 18, 2024, amended on November 25, 2024 and January 7, 2025, and declared effective by the SEC on January 8, 2025.

Registration Statement on Form S-3 (resale registration statement), File No. 333-284512, filed January 24, 2025, and declared effective by the SEC on January 29, 2025.

Registration Statement on Form S-8 registering 1,000,000 shares of common stock issuable under Neuphoria’s 2024 Equity Incentive Plan, File No. 333-284544, filed January 28, 2025, automatically declared effective by the SEC on January 29, 2025.

Expected $15 Million Milestone Payment Due from Merck & Co., Inc.

On February 12, 2025, the Company announced it is due to receive a $15 million milestone payment from Merck & Co., Inc. ("Merck"). The payment is triggered by the initiation by Merck of a Phase 2 clinical trial to evaluate the safety and efficacy of MK-1167, an α7 nicotinic acetylcholine receptor positive allosteric modulator, for the treatment of the symptoms of Alzheimer’s disease dementia (NCT06721156). This $15 million payment marks the second milestone achieved in the collaboration with Merck. Under the agreement, Neuphoria is eligible to receive up to $450 million in additional milestone payments for certain development and commercial milestones associated with the progress of multiple candidates plus royalties on net sales of any licensed medicines.

The Company expects that, together with this milestone payment, the cash on hand and its ATM facility, it will likely have sufficient funds into the fourth fiscal quarter of 2026, assuming no material changes to projected costs, expansion, or timing of its clinical trials.

Equity Issued Under ATM Facility

On February 12, 2025, the Company issued 128,368 shares of common stock under its ATM facility for net proceeds of approximately $0.7 million.

There are no other matters or circumstances that have arisen since December 31, 2024 which significantly affect or may significantly affect the results of the operations of the Company.