Private Placement

12 Months Ended

Jun. 30, 2025

Note 10. Private Placement

On May 31, 2024, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with a select institutional accredited investor (the “Investor”), pursuant to which the Company agreed to issue and sell to the Investor in a three-tranche private placement (the “Private Placement”) of American Depositary Shares with each ADS representing 180 ordinary shares of the Company, no par value per share, or pre-funded warrant to purchase ADSs (the “pre-funded warrant”) in lieu thereof, and an accompanying five-year cash purchase warrant (the “accompanying warrant”), related solely to the first tranche of the private placement).

The first tranche of the Private Placement consisted of 1,296,486 ADS and 6,279,905 pre-funded warrant, at a combined purchase price of $0.99 per ADS and accompanying warrant (or $0.9899 per pre-funded warrant and accompanying warrant, which is the combined purchase price of $0.99 per ADS and accompanying warrant, minus $0.0001 which is the exercise price of each pre-funded warrant) (the “Initial Purchase Price”) and the accompanying five-year cash exercise warrant to purchase up to 12,652,572 ADSs at an exercise price of $0.99 per ADS (or pre-funded warrant in lieu thereof) at the Initial Purchase Price per ADS (or pre-funded warrant in lieu thereof). The first tranche of the private placement closed on June 3, 2024, resulting in aggregate gross proceeds to the Company of $7.5 million.

The second tranche of the private placement is subject to the satisfaction of regulatory milestones that, if achieved, involve the purchase by the Investor of up to an additional $25.0 million of common stock, or pre-funded warrant in lieu thereof, from the Company at the Initial Purchase Price (as converted for the effect of the redomiciliation and the related share exchange). The second tranche milestones are: the earlier of (i) receipt of formal written correspondence by the Company from the Food and Drug Administration (“FDA”) following planned interactions with the FDA regarding the outcomes of the End-of-Phase 2 meeting and breakthrough designation status for BNC210 for PTSD, or (ii) December 31, 2024. These milestones were not achieved as of December 31, 2024.

The third tranche of the private placement is subject to the satisfaction of regulatory milestones that, if achieved, involves the purchase by the Investor of up to an additional $25.0 million of common stock, or pre-funded warrant in lieu thereof, from the Company at the Initial Purchase Price (as converted for the effect of the redomiciliation and the related share exchange). The third tranche milestones are: the latter of (i) completion of an interim blinded safety review of the planned BNC210 Phase-3 PTSD study, or (ii) December 31, 2025.

The third tranche purchase option will, however, become a mandatory maximum purchase by Investor during the thirty days following receipt by the Investor of a third tranche closing notice by the Company if the Company’s 10-day volume-weighted average price per share is at least $96.00 with an aggregate of at least $100 million in trading volume (or such lesser amount as may be approved by the Investor).

The Securities Purchase Agreement contains customary representations and warranties and agreements of the Company and the Investor and customary indemnification rights and obligations of the parties.

In accordance with accounting principles generally accepted in the United States of America, the Company allocated the aggregate gross proceeds of $7.5 million for the first tranche of the Private Placement by first recording the accompanying warrant as a liability at its fair value and then recording the residual proceeds to the ADSs and the pre-funded ADS warrant as permanent equity on a relative fair value basis.

The accompanying warrant is a freestanding financial instrument that is not subject to ASC 480-10-25. In addition, the accompanying warrant is not considered indexed to the Company’s stock as, in the event of certain fundamental transactions, the holder of the

accompanying warrant may require the Company to make a payment based on a Black-Scholes valuation, using specific inputs. As a result, the Company recorded the accompanying warrant as a liability at fair value with continuous adjustment to fair value each reporting period through the Consolidated Statements of Operations and Comprehensive Income (Loss).

The pre-funded warrant was a freestanding financial instruments that was not subject to ASC 480-10-25 and was considered indexed to the Company’s stock. The Company recorded the pre-funded warrant as permanent equity with no subsequent measurement adjustments unless modification. The pre-funded warrant was exercised in full in July 2024.

The fair value of the accompanying warrant, which is required to be subsequently measured pursuant to accounting principles generally accepted in the United States of America, was calculated using a Black-Scholes calculation with the following assumptions:


	Year Ended June 30,			Year Ended June 30,
	2025			2024
Expected term (in years)		4			5
Expected volatility		79.6	%		59.8	%
Risk-free interest		3.7	%		4.1	%
Dividend yield		-	%		-	%

Direct and incremental costs related to the accompanying warrant was expensed as incurred. Direct and incremental costs related to the pre-funded warrant was recorded as reductions in the related proceeds.

Neuphoria Therapeutics Inc. 10-K