beat-20220930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


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

For the quarterly period ended September 30, 2022


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

For the transition period from ___________ to ___________

Commission File Number: 001-41060

HEARTBEAM, INC.

(Exact Name of Registrant as Specified in its Charter)


Delaware						47-4881450
State or Other Jurisdiction of Incorporation or Organization						I.R.S. Employer Identification No.

2118 Walsh Avenue, Suite 210 Santa Clara, CA						95050
Address of Principal Executive Offices						Zip Code

(408) 899-4443

Registrant’s Telephone Number, Including Area Code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock

BEAT

NASDAQ

Warrants

BEATW

NASDAQ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

Number of shares of common stock outstanding as of November 9, 2022 was 8,004,620.


		Page
	PART I-FINANCIAL INFORMATION	1
Item l.	Condensed Unaudited Financial Statements	1
	Balance Sheets as of September 30, 2022 and December 31, 2021	1
	Statements of Operations for the three and nine months ended September 30, 2022 and 2021	2
	Statements of Shareholders’ Equity and Deficit for the three and nine months ended September 30, 2022 and 2021	3
	Statements of Cash Flows for the nine months ended September 30, 2022 and 2021	4
	Notes to the Condensed Unaudited Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	16
Item 4.	Controls and Procedures	16

	PART II-OTHER INFORMATION	18
Item 1.	Legal Proceedings	18
Item 1A.	Risk Factors	18
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	18
Item 3.	Defaults Upon Senior Securities	18
Item 4.	Mine Safety Disclosures	18
Item 5.	Other Information	18
Item 6.	Exhibits	19
SIGNATURES		20


	September 30, 2022		December 31, 2021
Assets
Current Assets:
Cash and cash equivalents	$	6,549	$	13,192
Prepaid expenses and other assets	123		806
Total Assets	$	6,672	$	13,998

Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable and accrued expenses (includes related party $1 for each period respectively)	932		588


Total Liabilities	932		588

Commitments (Note 7)

Stockholders’ Equity
Common stock - $0.0001 par value; 20,000,000 shares authorized; 8,000,870 and 7,809,912 shares issued and outstanding at September 30, 2022 and December 31, 2021	1		1
Additional paid in capital	24,213		22,633
Accumulated deficit	(18,474)		(9,224)
Total Stockholders’ Equity	$	5,740	$	13,410

Total Liabilities and Stockholders’ Equity	$	6,672	$	13,998


	Three months ended September 30,				Nine months ended September 30,
	2022		2021		2022		2021
Operating Expenses:
General and administrative	$	2,048	$	341	$	5,256	$	785
Research and development	1,562		105		4,036		159
Total operating expenses	3,610		446		9,292		944

Loss from operations	(3,610)		(446)		(9,292)		(944)

Other Income (Expense)
Interest income (expense)	28		(742)		39		(1,421)
Other income	3		—		3		22
Total other income (expense)	31		(742)		42		(1,399)

Loss before provision for income taxes	$	(3,579)	$	(1,188)	$	(9,250)	$	(2,343)

Income tax provision	$	—	$	—	$	—	$	—

Net Loss	$	(3,579)	$	(1,188)	$	(9,250)	$	(2,343)

Net loss per share, basic and diluted	$	(0.44)	$	(0.32)	$	(1.14)	$	(0.63)

Weighted average common shares outstanding, basic and diluted	8,147,024		3,720,880		8,107,359		3,706,001


Three months ended September 30, 2022
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance – June 30, 2022	7,982,008	$	1	$	23,862	$	(14,895)	$	8,968
Stock based compensation, expense	—	—		351		—		$	351
Stock issuance upon vesting and exercise of stock options	5,112	—		—		—		$	—
Stock issuance upon vesting of restricted stock awards	13,750	—		—		—		$	—
Net loss	—	—		—		(3,579)		$	(3,579)
Balance – September 30, 2022	8,000,870	$	1	$	24,213	$	(18,474)	$	5,740


Three months ended September 30, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Deficit
	Shares	Amount
Balance – June 30, 2021	3,547,168	$	—	$	1,687	$	(5,951)	$	(4,264)
Stock based compensation, expense	—	—		53		—		53
Stock issuance upon vesting and exercise of stock options	8,143	—		—		—		—
Debt discount, share settled debt	—	—		212				212
Net loss	—	—		—		(1,188)		(1,188)
Balance – September 30, 2021	3,555,311	$	—	$	1,952	$	(7,139)	$	(5,187)


Nine months ended September 30, 2022
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance – December 31, 2021	7,809,912	$	1	$	22,633	$	(9,224)	$	13,410
Stock based compensation, expense	—	—		774		—		774
Sale of Common Stock and Warrants	136,025			804		—		804
Stock issuance upon vesting and exercise of stock options	33,683	—		2		—		2
Stock issuance upon vesting of restricted stock awards	21,250	—		—		—		—
Net loss	—	—		—		(9,250)		(9,250)
Balance – September 30, 2022	8,000,870	$	1	24,213		$	(18,474)	$	5,740


Nine months ended September 30, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Deficit
	Shares	Amount
Balance – December 31, 2020	3,527,850	$	—	$	11	$	(4,796)	$	(4,785)
Stock based compensation, expense	—	—		85		—		85
Stock issuance upon vesting and exercise of stock options	27,461	—		—		—		—
Debt discount, share settled debt	—	—		1,856				1,856
Net loss	—	—		—		(2,343)		(2,343)
Balance – September 30, 2021	3,555,311	$	—	$	1,952	$	(7,139)	$	(5,187)


	Three and Nine months ended September 30,
		2022	2021
Stock options (excluding exercisable penny stock options)		1,928,904	630,593
Restricted stock awards		257,720	—
Convertible debt		—	1,449,574
Warrants		3,908,276	422,549
Total		6,094,900	2,502,716


	Number of shares	Weighted average exercise price		Weighted average remaining life (years)	Aggregate intrinsic value (in thousands)
Outstanding - December 31, 2021	3,777,549	$	5.42	4.45	$	1,259
Issued	130,727	5.72		—	—

Outstanding – September 30, 2022	3,908,276	5.43		3.72	$	1,606
Exercisable – September 30, 2022	3,501,004	$	6.06	4.11	$	18


	Number of options outstanding	Weighted average exercise price (*)		Average remaining contractual life (in years)	Aggregate intrinsic value (in thousands)

Outstanding – December 31, 2021	1,105,938	$	2.03	8.8	$	1,535
Options granted	1,131,000	1.44
Options exercised	(33,683)	—
Options cancelled	(101,334)	3.19

Outstanding – September 30, 2022	2,101,921	1.69		8.9	4,802
Exercisable – September 30, 2022	556,005	$	1.33	7.3	$	1,505


	Nine Months ended September 30,
	2022	2021
Weighted-average Black-Scholes option pricing model assumptions:
Volatility	107.25% - 110.98%	90.01% - 93.02%
Expected term (in years)	5.62 - 5.94	5.69 - 5.98
Risk-free rate	1.47% - 3.10%	0.69% - 0.82%
Expected dividend yield	—	—
Weighted average grant date fair value per share	$1.08 - $1.75	$2.07 - $3.00


	Nine months ended September 30, 2022
	Numbers of Shares	Weighted Average Grant Date Fair value
Non-Vested at beginning of period	30,000	$	3.20
Shares granted	248,970	1.36
Shares vested	(21,250)	2.33
Non-vested	257,720	$	1.49


Exhibit Number						Description of Exhibit
31.1						Certification of Chief Executive Officer, dated Novem ber 10 , 2022, pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 *
31.2						Certification of Chief Financial Officer, dated November 1 0 , 2022, pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 *
32.1						Certifications of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 **
32.2						Certifications of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 **
101.INS						XBRL Instance Document+
101.SCH						XBRL Taxonomy Extension Schema Document+
101.CAL						XBRL Taxonomy Extension Calculation Linkbase Document+
101.DEF						XBRL Taxonomy Extension Definition Linkbase Document+
101.LAB						XBRL Taxonomy Extension Label Linkbase Document+
101.PRE						XBRL Taxonomy Extension Presentation Linkbase Document+
104						Cover Page Interactive Data File - The cover page iXBRL tags are embedded within the inline XBRL document+
*						Filed herewith.
**						Furnished herewith.
+						Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files in Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.


	HEARTBEAM, Inc.

	By:	/s/ Branislav Vajdic
	Name:	Branislav Vajdic
	Title:	Chief Executive Officer
		(Principal Executive Officer)

	By:	/s/ Richard Brounstein
	Name:	Richard Brounstein
	Title:	Chief Financial Officer
Dated: November 10, 2022		(Principal Financial and Accounting Officer)


	For three months ended September 30,								For nine months ended September 30,
	2022		2021		$ Change		% Change		2022		2021		$ Change		% Change
	(In thousands, except percentages)

Operating expenses:
General and administrative	$	2,048	$	341	$	1,707	501	%	$	5,256	$	785	$	4,471	570	%
Research and development	1,562		105		1,457		1,388	%	4,036		159		3,877		2,438	%
Total operating expenses	3,610		446		3,164		709	%	9,292		944		8,348		884	%

Loss from operations	(3,610)		(446)		(3,164)		709	%	(9,292)		(944)		(8,348)		884	%

Interest income (expense)	28		(742)		770		(104)	%	39		(1,421)		1,460		(103)	%

Other income	3		—		3		100	%	3		22		(19)		(86)	%

Income tax provision	—		—		—		—	%	—		—		—		—	%

Net loss	$	(3,579)	$	(1,188)	$	(2,391)	201	%	$	(9,250)	$	(2,343)	$	(6,907)	295	%

SEC Form 10-Q filed by Heartbeam Inc.