(Exact name of registrant as specified in its charter)

Nevada	333-150419	26-1434750
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

 

 

 

Item No.		Description of Item		Page No.
Item 1.01		Entry Into a Material Definitive Agreement		3
Item 2.01		Completion of Acquisition or Disposition of Assets		4
Item 3.02		Unregistered Sales of Equity Securities		53
Item 4.01		Changes in Registrant’s Certifying Accountant		53
Item 5.01		Changes in Control of Registrant		54
Item 5.02		Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers		54
Item 5.06		Change in Shell Company Status		54
Item 8.01		Other Events		54
Item 9.01		Financial Statements and Exhibits		55

 

 

	●	pursue development and regulatory approval pathways by reformulating versions of approved drugs for new uses and by using the Section 505(b)(2) pathway for FDA approval;
	●	adopt a two-pronged patent strategy by seeking methods of use patents for the active ingredients in our products and by seeking protection for the formulation technology employed in our products;
	●	provide clear value propositions to third-party payers, such as managed care companies or government programs like Medicare, to merit reimbursement for our product candidates; and
	●	enter into collaborations with other pharmaceutical companies with respect to, among others, our FM and PTSD product candidates and other products that will benefit from development or marketing resources beyond those in our Company.

Pursue development and regulatory approval pathways. We believe our lead product candidates may be approvable under pathways that are potentially shorter than those typically available for drug products based on novel active ingredients. By focusing on developing new formulations of approved drugs for new uses, we believe that we will be able to use the Section 505(b)(2) pathway for FDA approval. This pathway can reduce the time and expense required for our development programs by allowing our use of previously-generated safety and efficacy information regarding the active pharmaceutical ingredients in our lead product candidates to support the filing and approval of our NDA application. Doing so may help reduce the size and scope of our preclinical and clinical trials.

 

 

 

●	provided benefit in core symptoms of FM, including pain and fatigue;

●	improved mood, by demonstrating a significant decrease in HAD scores; and

●	was well tolerated, with no serious adverse events, or SAEs, or discontinuations due to adverse events, or AEs.

 

 

 

 

If our Phase 2b study is successful, we expect to conduct a Phase 3 program in support of an NDA. At this time, our general plan includes two large scale, randomized, double-blind, placebo-controlled Phase 3 studies, and one open-label extension study. We anticipate that the treatment duration for the two large studies will be approximately 12-16 weeks in length. The numbers of patients to be evaluated is unknown at this time. We plan to confer with the FDA concerning the suggested sample sizes in an End-of-Phase 2 program review meeting. Once completing their participation in one of the two large scale studies, we expect our subjects will have the choice of enrolling in an available open-label study whereby we can assess the longer-term benefits of TNX-105 therapy in PTSD.

 

 

 

A potential competing medication for treating FM symptoms at bedtime had been Rekinla® which was being developed by Jazz Pharmaceuticals, or Jazz. The active ingredient in Rekinla® is sodium oxybate, which results in profound sedation and amnesia. Sodium oxybate is the active ingredient in XYREM®, approved by the FDA for the treatment of excessive daytime sleepiness and cataplexy, the sudden loss of muscle tone, in adult patients with narcolepsy. Rekinla® is administered at bedtime and a second dose is administered by awakening the patient four hours later. Jazz’ studies of Reinkla showed that a treatment that affects sleep quality can improve FM symptoms to meet FDA requirements for an effective product. While Jazz obtained compelling evidence supporting the efficacy of its treatment on FM symptoms, the FDA rejected their application to market Rekinla® for treating FM in 2010. Sodium Oxybate is a controlled substance under the auspices of the Drug Enforcement Administration (DEA). In June 2011, Jazz publicly announced their intention to cease development of Rekinla for FM.

 

	•		completion of extensive nonclinical laboratory tests, animal studies and formulation studies, all performed in accordance with the FDA’s Good Laboratory Practice regulations;
	•		submission to the FDA of an IND, which must become effective before human clinical trials may begin;
	•		for some products, performance of adequate and well-controlled human clinical trials in accordance with the FDA’s regulations, including Good Clinical Practices, to establish the safety and efficacy of the product candidate for each proposed indication;
	•		submission to the FDA of an NDA;
	•		satisfactory completion of an FDA preapproval inspection of the manufacturing facilities at which the product is produced to assess compliance with current Good Manufacturing Practice, or cGMP, regulations; and
	•		FDA review and approval of the NDA prior to any commercial marketing, sale or shipment of the drug.

 

	•		Phase 1 clinical trials typically involve the initial introduction of the product candidate into healthy human volunteers. In Phase 1 clinical trials, the product candidate is typically tested for safety, dosage tolerance, absorption, metabolism, distribution, excretion and pharmacodynamics.
	•		Phase 2 clinical trials are conducted in a limited patient population to gather evidence about the efficacy of the product candidate for specific, targeted indications; to determine dosage tolerance and optimal dosage; and to identify possible adverse effects and safety risks.
	•		Phase 3 clinical trials are undertaken to evaluate clinical efficacy and to test for safety in an expanded patient population at geographically dispersed clinical trial sites. The size of Phase 3 clinical trials depends upon clinical and statistical considerations for the product candidate and disease, but sometimes can include several thousand patients. Phase 3 clinical trials are intended to establish the overall risk-benefit ratio of the product candidate and provide an adequate basis for product labeling.

 

 

 

 

	•		record-keeping requirements;
	•		reporting of adverse experiences with the drug;
	•		providing the FDA with updated safety and efficacy information;
	•		reporting on advertisements and promotional labeling;
	•		drug sampling and distribution requirements; and
	•		complying with electronic record and signature requirements.

 

Lease Period		Amount Per Annum
October 1, 2010 – September 30, 2011		$	120,105.00
October 1, 2011 – September 30, 2012		$	123.496.20
October 1, 2012 – September 30, 2013		$	126,989.14
October 1, 2013 – September 30, 2014		$	130,586.86
October 1, 2014 – September 30, 2015		$	134,292.52

●	developing and testing product candidates;

●	receiving regulatory approvals;

●	commercializing our products; and

●	establishing a favorable competitive position.

 

●	successful commercialization of our product candidates;

●	the time and costs involved in obtaining regulatory approval for our product candidates;

●	costs associated with protecting our intellectual property rights;

●	development of marketing and sales capabilities;

●	payments received under future collaborative agreements, if any; and

●	market acceptance of our products.

 

 

 

 

Patent protection and other intellectual property protection is crucial to the success of our business and prospects, and there is a substantial risk that such protections will prove inadequate.

 

 

●	demonstrating sufficient safety and efficacy to obtain regulatory approval to commence a clinical trial;

●	reaching agreement on acceptable terms with prospective contract research organizations and trial sites;

●	manufacturing sufficient quantities of a product candidate; and

●	obtaining institutional review board approval to conduct a clinical trial at a prospective site.

 

 

If we are unable to hire additional qualified personnel, our ability to grow our business may be harmed.

 

 

 

 

If we, our collaborators, or our contract manufacturers fail to comply with applicable regulatory requirements at any stage during the regulatory process, such noncompliance could result in, among other things delays in the approval of applications or supplements to approved applications; refusal of a regulatory authority, including the FDA, to review pending market approval applications or supplements to approved applications; warning letters; fines; import and/or export restrictions; product recalls or seizures; injunctions; total or partial suspension of production; civil penalties; withdrawals of previously approved marketing applications or licenses; recommendations by the FDA or other regulatory authorities against governmental contracts; and/or criminal prosecutions.

 

 

 

●	government and health administration authorities;

●	private health insurers; and

●	other third party payors, including Medicare.

 

 

 

 

●	announcements of technological innovations or new products by us or our competitors;

●	announcement of FDA approval or disapproval of our products or other product-related actions;

●	developments involving our discovery efforts and clinical trials;

●	developments or disputes concerning patents or proprietary rights, including announcements of infringement, interference or other litigation against us or our potential licensees;

●	developments involving our efforts to commercialize our products, including developments impacting the timing of commercialization;

●	announcements concerning our competitors, or the biotechnology, pharmaceutical or drug delivery industry in general;

●	public concerns as to the safety or efficacy of our products or our competitors’ products;

●	changes in government regulation of the pharmaceutical or medical industry;

●	changes in the reimbursement policies of third party insurance companies or government agencies;

●	actual or anticipated fluctuations in our operating results;

●	changes in financial estimates or recommendations by securities analysts;

●	developments involving corporate collaborators, if any;

●	changes in accounting principles; and

●	the loss of any of our key scientific or management personnel.

 

 

	●	election of our board of directors;
	●	removal of any of our directors;
	●	amendment of our certificate of incorporation or bylaws; and
	●	adoption of measures that could delay or prevent a change in control or impede a merger, takeover or other business combination involving us.

 

	●	that a broker or dealer approve a person’s account for transactions in penny stocks; and
	●	the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.

	●	obtain financial information and investment experience objectives of the person; and
	●	make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.

	●	sets forth the basis on which the broker or dealer made the suitability determination; and
	●	that the broker or dealer received a signed, written agreement from the investor prior to the transaction.

	●	discuss our future expectations;
	●	contain projections of our future results of operations or of our financial condition; and
	●	state other “forward-looking” information.

 

 

 

 

 

 

	Total				2011				Thereafter
Operating lease obligations		$	515,365			$	30,874			$	484,491

NAME OF OWNER		TITLE OF CLASS		NUMBER OF SHARES OWNED (1)		PERCENTAGE OF COMMON STOCK
Seth Lederman		Common Stock		11,491,894 (2)		43.09%
Rhonda Rosen		Common Stock		196,359		*
Benjamin Selzer		Common Stock		532,350		2.00%
Susan Kerridge		Common Stock		130,906		*
Stuart Davidson		Common Stock		1,221,788 (3)		4.58%
Patrick Grace		Common Stock		130,906		*
Donald Landry		Common Stock		2,254,627 (4)		8.45%
Ernest Mario		Common Stock		1,047,245		3.93%
Charles Mather		Common Stock		87,269		*
John Rhodes		Common Stock		785,436		2.95%
Officers and Directors as a Group (10 persons)		Common Stock		15,983,923 (5)		59.94%
Lederman & Co., LLC (6)		Common Stock		5,753,865		21.58%
Eli Lederman (7)		Common Stock		2,236,310		8.39%
L&L Technologies, LLC (8)		Common Stock		1,894,857		7.11%
National Holdings Corporation (9)		Common Stock		1,865,406		7.00%
David J. Moss (10)		Common Stock		1,771,818		6.64%

(1)

Beneficial ownership percentages gives effect to the completion of the Share Exchange, and are calculated based on 26,666,667 shares of Common Stock issued and outstanding. Beneficial ownership is determined in accordance with Rule 13d-3 of the Exchange Act. The number of shares beneficially owned by a person includes shares of Common Stock underlying options or warrants held by that person that are currently exercisable or exercisable within 60 days of October 7, 2011. The shares issuable pursuant to the exercise of those options or warrants are deemed outstanding for computing the percentage ownership of the person holding those options and warrants but are not deemed outstanding for the purposes of computing the percentage ownership of any other person. The persons and entities named in the table have sole voting and sole investment power with respect to the shares set forth opposite that person’s name, subject to community property laws, where applicable, unless otherwise noted in the applicable footnote.

(2)

Includes 5,753,865 shares of common stock owned by Lederman & Co., LLC, 1,894,857 shares of common stock owned by L&L Technologies, Inc., 959,974 shares of common stock owned by Targent Pharmaceuticals, LLC and 73,961 shares owned by the Seth M. Lederman 1999 Trust. Seth Lederman, as the Managing Member of Lederman & Co., LLC and Targent Pharmaceuticals, LLC, the Manager of L&L Technologies, Inc. and the Trustee of the Seth M. Lederman 1999 Trust, has investment and voting control over the shares held by these entities.

(3)	Includes 1,090,882 shares of common stock owned by Lysander, LLC and 130,906 shares owned by Oystercatcher Trust. Stuart Davidson, as the Member of Lysander, LLC and Trustee of Oystercatcher Trust, has investment and voting control over the shares held by these entities.

(4)	Includes 1,894,857 shares of common stock owned by L&L Technologies, Inc. Donald Landry, as a Member of L&L Technologies, Inc., has investment and voting control over the shares held by this entity.

(5)

Includes 5,753,865 shares of common stock owned by Lederman & Co., LLC, 1,894,857 shares of common stock owned by L&L Technologies, Inc., 959,974 shares of common stock owned by Targent Pharmaceuticals, LLC, 73,961 shares owned by the Seth M. Lederman 1999 Trust, 1,090,882 shares of common stock owned by Lysander, LLC and 130,906 shares owned by Oystercatcher Trust.

(6)	Seth Lederman, our President and Chief Executive Officer, has investment and voting control over the shares held by this entity. The mailing address for this entity is 245 E. 93rd St. 14E, New York, New York 10128.

(7)	The mailing address for this beneficial owner is Malt House Cottage, Hurley, Berkshire, SL6 5LT, United Kingdom.

(8)	Seth Lederman, our President and Chief Executive Officer and Donald Landry, a Director, have investment and voting control over the shares held by this entity. The mailing address for this entity is 245 E. 93rd St. 14E, New York, New York 10128.

(9)	Mark Goldwasser, C.E.O. has investment and voting control over the shares held by this entity. The mailing address for this entity is 120 Broadway, 27th Floor, New York, NY 10271.

(10)	The mailing address for this beneficial owner is 23046 Avenida de la Carlota, Suite 600, Laguna Hills, CA 92653.

 

 

Name		Age		Position
Seth Lederman		54		President, CEO and Chairman of the Board of Directors
Rhonda Rosen		54		Chief Financial Officer
Benjamin Selzer		34		Chief Operating Officer
Susan Kerridge		34		Secretary
Stuart Davidson		54		Director
Patrick Grace		55		Director
Donald Landry		57		Director
Ernest Mario		73		Director
Charles Mather		51		Director
John Rhodes		55		Director

 

 

	1.	any bankruptcy petition filed by or against such person or any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;
	2.	any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
	3.	being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from or otherwise limiting his involvement in any type of business, securities or banking activities or to be associated with any person practicing in banking or securities activities;
	4.	being found by a court of competent jurisdiction in a civil action, the Securities and Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated;
	5.	being subject of, or a party to, any federal or state judicial or administrative order, judgment decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of any federal or state securities or commodities law or regulation, any law or regulation respecting financial institutions or insurance companies, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
	6.	being subject of or party to any sanction or order, not subsequently reversed, suspended, or vacated, of any self-regulatory organization, any registered entity or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

 

 

Name & Principal Position	Year		Salary ($)				Bonus ($)				Stock Awards ($)								Option Awards ($)				Non-Equity Incentive Plan Compensation ($)				Change in Pension Value and Non-Qualified Deferred Compensation Earnings ($)				All Other Compensation ($)								Total ($)
Seth Lederman	2010			-				-				69,738				(1	)			-				-				-				205,833				(2	)			275,571
	2009			-				-				-								-				-				-				-								-
Rhonda Rosen	2010			93,750				-				8,865				(3	)			-				-				-				-								102,615
	2009			-				-				-								-				-				-				-								-

(1)	Represents (i) 60,000 shares of common stock granted to Lederman & Co., LLC, and (ii) 294,000 shares of common stock granted to L&L Technologies, LLC, which stock was vested at a value of $0.197/share as of December 31, 2010.

(2)	Represents $56,000 of consulting fees paid to L&L Technologies, $145,833 of consulting fees paid to Lederman & Co. and $4,000 of director fees paid.

(3)	Represents 45,000 shares of common stock granted and vested at a value of $0.197/share as of December 31, 2010.

Name		Number of Shares or Units of Stock that have not Vested (#)			Market Value of Shares or Units of Stock that have not Vested ($)			Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that have not Vested ($)			Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that have not Vested ($)
Seth Lederman		1,122,000			221,034			0			0
Rhonda Rosen		180,000			35,460			0			0
Susan Kerridge		120,000			23,640			0			0

Name		Fees Earned or Paid in Cash ($)				Stock Awards ($)				Total ($)
Stuart Davidson			-				29,550				29,550
Patrick Grace			4,000				27,186				31,186
Donald Landry			4,000				231,672				235,672
Ernest Mario			-				39,400				39,400
Charles Mather			-				-				-
John Rhodes			-				29,550				29,550
Total:			8,000				357,358				365,358

 

 

On June 4, 2010, Tonix entered into a technology transfer and assignment agreement with Lederman & Co., LLC. Pursuant to this agreement, Lederman & Co. transferred intellectual property rights related to isometheptene mucate to Tonix. In exchange for the assignment of the intellectual property rights, Tonix issued to Lederman & Co. 1,500,000 shares of its common stock.

On June 4, 2010 Tonix entered into a consulting agreement with L&L Technologies, LLC, of which our Chairman, CEO and President Seth Lederman is the Manager. Pursuant to this agreement, L&L Technologies shall provide scientific and medical consulting services. In exchange for its services, Tonix shall pay L&L Technologies compensation of $96,000 per annum, or such greater amount as the Board may designate from time to time, and issued to L&L Technologies 1,176,000 shares of its common stock, 25% of which vested on the date of the agreement and the remainder vesting in equal amounts on each of the first, second and third anniversaries of the date of the agreement.  Immediately prior to the Share Exchange, the unvested shares of common stock vested.

 

 

 

 

 

 

 

 

Item 9.01     Financial Statements and Exhibits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Report of Independent Registered Public Accounting Firm	F-1
Consolidated balance sheets as of December 31, 2010 and 2009	F-2
Consolidated statements of operations for the years ended December 31, 2010 and 2009 and for the period from June 7, 2007 (inception) through December 31, 2010	F-3
Consolidated statements of stockholders’ deficiency for the years ended December 31, 2010, 2009 and 2008 and for the period from June 7, 2007 (inception) through December 31, 2007	F-4
Consolidated statements of cash flows for the years ended December 31, 2010 and 2009 and for the period from June 7, 2007 (inception) through December 31, 2010	F-5
Notes to consolidated financial statements	F-6

Unaudited pro forma condensed combined financial statements	F-31
Unaudited pro forma condensed combined balance sheet	F-32
Unaudited pro forma condensed combined statement of operations for the nine months ended September 30, 2011	F-33
Unaudited pro forma condensed combined statement of operations for the year ended December 31, 2010	F-34
Notes to unaudited pro forma condensed combined financial statements	F-35

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note B[1] to the financial statements, the Company has incurred recurring net losses and negative cash flows from operations, has both working capital and stockholders' deficiencies at December 31, 2010 and requires additional financing to fund future operations. These events and conditions, among others referred to in Note B[1], raise substantial doubt about the Company's ability to continue as a going concern. Management's plans concerning these matters are also described in Note B[1]. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

		December 31,
		2010				2009
ASSETS
Current assets:
Cash and cash equivalents		$	65,359			$	1,065
Prepaid expenses			23,313				3,998
Total current assets			88,672				5,063
Furniture and equipment, net			32,086				1,661
Restricted cash			60,087
Other assets			3,156				3,156
		$	184,001			$	9,880
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
Current liabilities:
Accounts payable		$	317,745			$	23,613
Accrued expenses			22,533				57,322
Accrued interest							36,387
Demand notes payable							430,000
Total current liabilities			340,278				547,322
Deferred rent payable			19,174
Total liabilities			359,452				547,322
Commitments (Note G)
Stockholders' deficiency:
Preferred stock; 8.0% cumulative, par value $.01; 6,000,000 shares authorized; 1,500,000 shares issued and outstanding at December 31, 2009 (aggregate liquidation preference of $232,000)							15,000
Series A preferred stock; 6.0% cumulative, par value $.01; 1,500,000 shares authorized, issued and outstanding at December 31, 2010 (aggregate liquidation preference of $245,101)			15,000
Series B preferred stock; 6.0% cumulative, par value $.01; 2,727,273 shares authorized; 1,719,163 shares issued and outstanding at December 31, 2010 (aggregate liquidation preference of $1,924,181)			17,192
Common stock; par value $.01; 12,000,000 and 1,500,000 shares authorized; 2,959,500 and 786,000 shares issued and outstanding at December 31, 2010 and 2009, respectively			29,595				7,860
Additional paid-in capital			2,687,329				399,795
Deficit accumulated during the development stage			(2,924,567	)			(960,097	)
Total stockholders' deficiency			(175,451	)			(537,442	)
		$	184,001			$	9,880