beat-20230630

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 June 30, 2023


☐			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 August 9, 2023 was 26,311,904.


		Page
	PART I-FINANCIAL INFORMATION	1
Item l.	Condensed Unaudited Financial Statements	1
	Balance Sheets as of June 3 0 , 2023 and D ecember 31, 2022	1
	Statements of Operations for the three and six months ended June 3 0 , 2023 and 2022	2
	Statements of Shareholders’ Equity for the three and six months ended June 3 0 , 2023 and 2022	3
	Statements of Cash Flows for the six months ended June 3 0 , 2023 and 2022	5
	Notes to the Condensed Unaudited Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	15
Item 4.	Controls and Procedures	15

	PART II-OTHER INFORMATION	17
Item 1.	Legal Proceedings	17
Item 1A.	Risk Factors	17
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	17
Item 3.	Defaults Upon Senior Securities	17
Item 4.	Mine Safety Disclosures	17
Item 5.	Other Information	17
Item 6.	Exhibits	18
SIGNATURES		19


	June 30, 2023		December 31, 2022
Assets
Current Assets:
Cash and cash equivalents	$	17,401	$	3,594
Short-term investments	3,939		—
Prepaid expenses and other assets	292		445
Total Assets	$	21,632	$	4,039

Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable and accrued expenses (includes related party $1 and $2 respectively)	570		1,665


Total Liabilities	570		1,665

Commitments

Stockholders’ Equity
Preferred stock - $0.0001 par value; 10,000,000 authorized; 0 shares outstanding at June 30, 2023 and December 31, 2022	—		—
Common stock - $0.0001 par value; 100,000,000 shares authorized; 25,990,516 and 8,009,743 shares issued and outstanding at June 30, 2023 and December 31, 2022	3		1
Additional paid in capital	50,535		24,559
Accumulated deficit	(29,476)		(22,186)
Total Stockholders’ Equity	$	21,062	$	2,374

Total Liabilities and Stockholders’ Equity	$	21,632	$	4,039


	Three months ended June 30,				Six months ended June 30,
	2023		2022		2023		2022
Operating Expenses:
General and administrative	$	1,828	$	1,793	$	4,303	$	3,208
Research and development	1,484		1,742		3,165		2,475
Total operating expenses	3,312		3,535		7,468		5,683

Loss from operations	(3,312)		(3,535)		(7,468)		(5,683)

Other Income
Interest income	158		10		178		12
Total other income	158		10		178		12

Loss before provision for income taxes	$	(3,154)	$	(3,525)	$	(7,290)	$	(5,671)

Income tax provision	$	—	$	—	$	—	$	—

Net Loss	$	(3,154)	$	(3,525)	$	(7,290)	$	(5,671)

Net loss per share, basic and diluted	$	(0.16)	$	(0.43)	$	(0.52)	$	(0.70)

Weighted average common shares outstanding, basic and diluted	19,690,251		8,145,967		13,910,365		8,092,237


Three months ended June 30, 2023
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance - April 1, 2023	8,227,074	$	1	$	25,462	$	(26,322)	$	(859)
Stock based compensation expense	—	—		702		—		702
Sale of Common Stock, net of issuance costs	17,666,666	2		24,268		—		24,270
Stock issuance upon vesting and exercise of stock options	88,026	—		103		—		103
Stock issuance upon vesting of restricted stock awards	8,750	—		—		—		—
Stock issuance upon exercise of warrants	—	—		—		—		—
Net loss	—	—		—		(3,154)		(3,154)
Balance – June 30, 2023	25,990,516	$	3	$	50,535	$	(29,476)	$	21,062


Three months ended June 30, 2022
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance - April 1, 2022	7,958,888	$	1	$	23,596	$	(11,370)	$	12,227
Stock based compensation expense	—	—		264		—		264
Stock issuance upon vesting and exercise of stock options	19,370	—		2		—		2
Stock issuance upon vesting of restricted stock units	3,750	—		—				—
Net loss	—	—		—		(3,525)		(3,525)
Balance – June 30, 2022	7,982,008	$	1	$	23,862	$	(14,895)	$	8,968


Six months ended June 30, 2023
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance - January 1, 2023	8,009,743	$	1	$	24,559	$	(22,186)	$	2,374
Stock based compensation expense	—	—		1,095		—		1,095
Sale of Common Stock, net of issuance costs	17,872,955	2		24,762		—		24,764
Stock issuance upon vesting and exercise of stock options	88,026	—		103		—		103
Stock issuance upon vesting of restricted stock awards	12,500	—		—		—		—
Stock issuance upon exercise of warrants	7,292	—		16		—		16
Net loss	—	—		—		(7,290)		(7,290)
Balance – June 30, 2023	25,990,516	$	3	$	50,535	$	(29,476)	$	21,062


Six months ended June 30, 2022
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
Balance - January 1, 2022	7,809,912	$	1	$	22,633	$	(9,224)	$	13,410
Stock based compensation expense	—	—		423		—		423
Sale of Common Stock and warrants	136,025			804				804
Stock issuance upon vesting and exercise of stock options	28,571	—		2		—		2
Stock issuance upon vesting of restricted stock units	7,500	—		—				—
Net loss	—	—		—		(5,671)		(5,671)
Balance – June 30, 2022	7,982,008	$	1	$	23,862	$	(14,895)	$	8,968


	Three and Six months ended June 30,
		2023	2022
Stock options (excluding exercisable penny stock options)		2,851,383	1,868,218
Restricted stock awards		246,470	22,500
Warrants		5,152,397	3,908,276
Total		8,250,250	5,798,994


	Number of shares	Weighted average exercise price		Weighted average remaining life (years)	Aggregate intrinsic value (in thousands)
Outstanding - December 31, 2022	3,908,276	$	5.42	3.47	$	2,020
Issued	1,666,666	1.88		—	—
Exercised	(11,638)	2.75		—	—
Expired	(410,907)	—		—	—
Outstanding and Exercisable – June 30, 2023	5,152,397	$	4.71	3.85	$	892


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

Outstanding – December 31, 2022	2,196,798	$	1.76	8.7	$	6,770
Options granted	1,115,800	2.62		—	—
Options exercised	(88,026)	1.17		—	—
Options cancelled	(195,834)	1.70		—	—

Outstanding – June 30, 2023	3,028,738	2.10		8.7	2,040
Exercisable – June 30, 2023	1,052,605	$	1.64	7.6	$	1,177


	Six months ended June 30,
	2023		2022
Weighted-average Black-Scholes option pricing model assumptions:
Volatility	110.23% - 111.73%		107.25% - 110.98%
Expected term (in years)	5.71 - 6.07		5.73 - 5.80
Risk-free rate	3.54% - 3.80%		1.47% - 2.85%
Expected dividend yield	$	—	$	—
Weighted average grant date fair value per share	$1.73 - $3.38		$1.08 - $1.75


	Six months ended June 30, 2023
	Numbers of Shares	Weighted Average Grant Date Fair value
Non-Vested at beginning of period	253,970	$	1.47
Shares granted	5,000	2.24
Shares vested	(12,500)	2.82
Non-vested	246,470	$	1.44


Exhibit Number						Description of Exhibit
3.1						Articles of Incorporation filed with the State of Delaware on June 11, 2015 (incorporated by reference to Exhibit 3.1 to our current report on Form S-1 filed September 7, 2021)
3.2						Bylaws (incorporated by reference to Exhibit 3.2 to our current report on Form S-1 filed September 9, 2021)
3.3						Amendment to Articles of Incorporation filed with the State of Delaware on September 27, 2021 (incorporated by reference to Exhibit 3.3 to our current report on Form S-1 filed October 4, 2021)
3.4						Second Amended and Restated Articles of Incorporation dated November 15, 2022 (incorporated by reference to Exhibit 3.4 to our current report on Form S-1 filed February 10, 2023
31.1						Certification of Chief Executive Officer, dated August 10 2023, 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 August 10 , 2023, 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: August 10, 2023		(Principal Financial and Accounting Officer)


	For three months ended June 30,								For six months ended June 30,
	2023		2022		$ Change		% Change		2023		2022		$ Change		% Change
	(In thousands, except percentages)

Operating expenses:
General and administrative	$	1,828	$	1,793	$	35	2	%	$	4,303	$	3,208	$	1,095	34	%
Research and development	1,484		1,742		(258)		(15)	%	3,165		2,475		690		28	%
Total operating expenses	3,312		3,535		(223)		(6)	%	7,468		5,683		1,785		31	%

Loss from operations	(3,312)		(3,535)		223		(6)	%	(7,468)		(5,683)		(1,785)		31	%

Interest income (expense)	158		10		148		1,480	%	178		12		166		1,383	%

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

Net loss	$	(3,154)	$	(3,525)	$	371	(11)	%	$	(7,290)	$	(5,671)	$	(1,619)	29	%

SEC Form 10-Q filed by Heartbeam Inc.