Filed pursuant to Rule 424(b)(3)

Registration No. 333-226174

PROSPECTUS SUPPLEMENT NO. 5
(To the Prospectus dated September 28, 2018)

 

13,090,586 Shares of Common Stock

This Prospectus Supplement No.5 supplements the prospectus dated September 28, 2018 (the “prospectus”) relating to the offering and resale by the selling stockholders identified in the prospectus of up to 13,090,586 shares of common stock of Amesite Inc., par value $0.0001 per share. This Prospectus Supplement should be read in conjunction with the prospectus which is to be delivered with this Prospectus Supplement. Any statement contained in the prospectus shall be deemed to be modified or superseded to the extent that information in this Prospectus Supplement modifies or supersedes such statement. Any statement that is modified or superseded shall not be deemed to constitute a part of the prospectus except as modified or superseded by this Prospectus Supplement.

This Prospectus Supplement is being filed to update and supplement the information in the prospectus with our Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 14, 2019

Investing in our common stock involves a high degree of risk. Before making an investment decision, please read “Risk Factors” beginning on page 9 of this prospectus.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is May 14, 2019

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One) 

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

For the quarterly period ended March 31, 2019

or

☐ 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 000-54495

AMESITE INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	82-1433756
State or Other Jurisdiction of Incorporation or Organization	I.R.S. Employer Identification No.
205 East Washington Street, Ann Arbor, MI Suite B	48104
Address of Principal Executive Offices	Zip Code

(650) 516-7633

Registrant’s Telephone Number, Including Area Code

N/A

Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

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 ☒

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.   Yes ☐   No ☐

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
N/A	N/A	N/A

APPLICABLE ONLY TO CORPORATE ISSUERS

Number of shares of issuer’s common stock outstanding as of May 13, 2019: 13,490,586

TABLE OF CONTENTS

	Page
PART I - FINANCIAL INFORMATION	1
ITEM 1. FINANCIAL STATEMENTS	1
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	13
ITEM 3. QUALITATIVE AND QUANTITATIVE DISCUSSION ABOUT MARKET RISK	15
ITEM 4. CONTROLS AND PROCEDURES	15
PART II – OTHER INFORMATION	16
ITEM 1. LEGAL PROCEEDINGS	16
ITEM 1A. RISK FACTORS	16
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	16
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	16
ITEM 4. MINE SAFETY DISCLOSURES	16
ITEM 5. OTHER INFORMATION	16
ITEM 6. EXHIBITS	17
SIGNATURES	18
CERTIFICATIONS

i

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains statements reflecting assumptions, expectations, projections, intentions or beliefs about future events that are intended as “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements included or incorporated by reference in this report, other than statements of historical fact, that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements. These statements appear in a number of places, including, but not limited to “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These statements represent our reasonable judgment of the future based on various factors and using numerous assumptions and are subject to known and unknown risks, uncertainties and other factors that could cause our actual results and financial position to differ materially from those contemplated by the statements. You can identify these statements by the fact that they do not relate strictly to historical or current facts, and use words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “may,” “should,” “plan,” “project” and other words of similar meaning. In particular, these include, but are not limited to, statements relating to the following:

● our planned online machine learning platform’s ability to improve first-year products and enable universities to offer timely, popular courses in their own physical facilities, without becoming software tech companies;

● our planned online machine learning platform’s ability to result in opportunistic incremental revenue for colleges and universities, and improved ability to garner state funds due to increased retention and graduation rates through use of machine learning and natural language processing;

● our ability to obtain additional funds for our operations;

● our ability to obtain and maintain intellectual property protection for our technologies and our ability to operate our business without infringing the intellectual property rights of others;

● our reliance on third parties to conduct our business and studies;

● our reliance on third party designers, suppliers, and partners to provide and maintain our learning platform;

● our ability to attract and retain qualified key management and technical personnel;

● our expectations regarding the time during which we will be an emerging growth company under the Jumpstart Our Business Startups Act, or Jobs Act;

● our financial performance;

● the impact of government regulation and developments relating to our competitors or our industry; and

● other risks and uncertainties, including those listed under the caption “Risk Factors” in our Transition Report on Form 10-K

ii

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

Amesite, Inc.

Condensed Consolidated Financial Statements

March 31, 2019

1

Amesite, Inc.

Contents

Condensed Consolidated Financial Statements
Condensed Consolidated Balance Sheets (unaudited)	3
Condensed Consolidated Statement of Operations (unaudited)	4
Condensed Consolidated Statement of Stockholders’ Equity (unaudited)	5
Condensed Consolidated Statement of Cash Flows (unaudited)	6
Notes to Condensed Consolidated Financial Statements	7-12

2

Amesite, Inc.

Condensed Consolidated Balance Sheets (unaudited)

	March 31, 2019			June 30, 2018
Assets
Current Assets
Cash and cash equivalents	$	2,092,022		$	4,274,116
Accounts receivable		2,831			-
Other receivable		-			5,000
Prepaid expenses and other current assets		44,020			53,609
Property and Equipment - Net		97,434			95,706
Capitalized Software Costs - Net		786,412			99,000
Security Deposit (Note 5)		5,000			5,000
Total assets	$	3,027,719		$	4,532,431
Liabilities and Stockholders’ Equity
Current Liabilities
Accounts payable	$	125,661		$	5,264
Advances from stockholder		-			1,065
Accrued and other current liabilities:
Accrued compensation		223,368			47,674
Accrued subcontractor fees		13,950			16,915
Accrued professional fees		54,536			172,340
Other accrued liabilities		24,043			9,994
Total liabilities		441,558			253,252
Stockholders’ Equity:
Common stock, $.0001 par value; 100,000,000 shares authorized; 13,090,585 and 12,750,307 shares issued and outstanding at March 31, 2019 and June 30, 2018, respectively		1,309			1,275
Preferred stock, $.0001 par value; 5,000,000 shares authorized; no shares issued and outstanding at March 31, 2019 and June 30, 2018		-			-
Additional paid-in capital		5,253,776			4,799,471
Accumulated deficit		(2,668,924	)		(521,567	)
Total stockholders’ equity		2,586,161			4,279,179
Total liabilities and stockholders’ equity	$	3,027,719		$	4,532,431

3

Amesite, Inc.

 Condensed Consolidated Statement of Operations (unaudited)

	Three Months Ended March 31, 2019			Three Months Ended March 31, 2018			Nine Months Ended March 31, 2019			November 14, 2017 (date of incorporation) through March 31, 2018
Net Sales	$	2,831		$	-		$	3,576		$	-
Operating Expenses
General and administrative expenses		121,679			23,969			272,281			47,523
Contract services		56,970			26,778			151,437			26,778
Travel expenses		4,285			2,746			27,561			4,684
Office rent		17,512			11,200			52,541			17,173
Professional fees		121,268			48,567			410,728			48,567
Payroll and related expenses		643,604			-			1,259,873			-
Total operating expenses		965,318			113,260			2,174,421			144,725
Interest Income		14,226			-			23,488			-
Net Loss	$	(948,261	)	$	(113,260	)	$	(2,147,357	)	$	(144,725	)
Earnings per Share
Basic earnings per share	$	(0.07	)	$	(0.03	)	$	(0.16	)	$	(0.02	)
Weighted average shares outstanding		13,090,585			5,833,333			13,075,628			5,833,333

4

Amesite, Inc.

Condensed Consolidated Statement of Stockholders’ Equity (unaudited)

	Common Stock		Additional Paid-In Capital			Accumulated Deficit			Total
Balance – June 30, 2018	$	1,275	$	4,799,471		$	(521,567	)	$	4,279,179
Net loss		-		-			(641,486	)		(641,486	)
Issuance of restricted common stock		34		(34	)		-			-
Stock compensation expense		-		148,241			-			148,241
Balance – September 30, 2018	$	1,309	$	4,974,678		$	(1,163,053	)	$	3,785,934
Net loss		-		-			(557,610	)		(557,610	)
Stock compensation expense		-		153,726			-			153,726
Balance – December 31, 2018	$	1,309	$	5,101,404		$	(1,720,663	)	$	3,382,050
Net Loss		-		-			(948,261	)		(948,261	)
Stock compensation expense		-		152,372			-			152,372
Balance – March 31, 2019	$	1,309		5,253,776		$	(2,668,924	)	$	2,586,161

	Common Stock		Paid-In Capital		Accumulated Deficit			Total
November 14, 2017	$	-	$	-	$	-		$	-
Net loss		-		-		(31,465	)		(31,465	)
Issuance – November 14, 2017		400		-		-			400
Balance – December 31, 2017		400		-		(31,465	)		(31,065	)
Net Loss		-		-		(113,260	)		(113,260	)
Stock compensation expense		-		18,640		-			18,640
Balance – March 31, 2018		400		18,640		(144,725	)		(125,685	)

5

Amesite, Inc.

 Condensed Consolidated Statement of Cash Flows (unaudited)

	Nine Months Ended March 31, 2019			November 14, 2017 (date of incorporation) through March 31, 2018
Cash Flows from Operating Activities
Net loss	$	(2,147,357	)	$	(144,725	)
Adjustments to reconcile net loss to net cash and cash equivalents from operating activities:
Depreciation and amortization		79,860			732
Stock compensation expense		454,339			18,640
Changes in operating assets and liabilities which (used) provided cash:
Accounts Receivable		(2,831	)		(18,000	)
Prepaid expenses and other assets		14,589			-
Accounts payable		120,397			-
Accrued compensation		175,694			-
Accrued and other liabilities		(106,720	)		298,589
Deferred offering costs		-			(215,256	)
Net cash and cash equivalents used in operating activities		(1,412,029	)		(60,020	)
Cash Flows from Investing Activities
Purchase of property and equipment		(29,490	)		(12,900	)
Investment in capitalized software		(739,510	)		-
Net cash and cash equivalents used in investing activities		(769,000	)		(12,900	)
Cash Flows from Financing Activities
Net repayments to stockholder		(1,065	)		91,856
Issuance of common stock - net of offering costs		-			400
Net cash and cash equivalents (used in) provided by financing activities		(1,065	)		92,256
Net Increase (Decrease) in Cash and Cash Equivalents		(2,182,094	)		19,336
Cash and Cash Equivalents - Beginning of period		4,274,116			-
Cash and Cash Equivalents - End of period	$	2,092,022		$	19,336
Significant Noncash Transactions - Acquisition of capitalized software included in accounts payable and accrued liabilities		75,100

6

Amesite, Inc.

 Notes to Condensed Consolidated Financial Statements

Note 1—Nature of Business

Amesite, Inc. (the “Company”) was formed in November 2017 and is a development stage artificial intelligence software company targeting the college course market.

During the nine month period ended March 31, 2019, the Company began generating revenue from its services and products. The Company’s activities are subject to significant risks and uncertainties, including failure to secure additional funding to execute the current business plan.

Note 2—Significant Accounting Policies

Basis of Presentation

The condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and considering the requirements of the United States Securities and Exchange Commission (“SEC”). The Company has a fiscal year with a June 30 year end.

In the opinion of management, the condensed consolidated financial statements of the Company include all adjustments and accruals, consisting only of normal, recurring accrual adjustments, which are necessary for a fair presentation of the results for the interim periods. These interim results are not necessarily indicative of results for a full year.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed in or omitted from this report pursuant to the rules and regulations of the SEC. These financial statements should be read together with the consolidated financial statements and notes thereto included in the Company’s Transition Report on Form 10-K for the year ended June 30, 2018.

Principles of Consolidation

The condensed consolidated financial statements of the Company include the accounts of Amesite, Inc. and its wholly owned subsidiary, Amesite Operating Company. All material intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Fair Value Measurements

Accounting standards require certain assets and liabilities be reported at fair value in the financial statements and provide a framework for establishing that fair value. The framework for determining fair value is based on a hierarchy that prioritizes the inputs and valuation techniques used to measure fair value.

Fair values determined by Level 1 inputs use quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

Fair values determined by Level 2 inputs use other inputs that are observable, either directly or indirectly. These Level 2 inputs include quoted prices for similar assets and liabilities in active markets and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals.

7

Amesite, Inc.

 Notes to Condensed Consolidated Financial Statements

Note 2 - Significant Accounting Policies (Continued)

Level 3 inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related asset. These Level 3 fair value measurements are based primarily on management’s own estimates using pricing models, discounted cash flow methodologies, or similar techniques.

In instances whereby inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Company’s assessment of the significance of particular inputs to these fair value measurements requires judgment and considers factors specific to each asset or liability.

Cash Equivalents

The Company considers all investments with an original maturity of three months or less when purchased to be cash equivalents. The total amount of bank deposits (checking, savings, and investment accounts) that was insured by the FDIC at year end was $250,000.

Property and Equipment

Property and equipment are recorded at cost. The straight-line method is used for computing depreciation and amortization. Assets are depreciated over their estimated useful lives. The cost of leasehold improvements is depreciated (amortized) over the lesser of the length of the related leases or the estimated useful lives of the assets. Costs of maintenance and repairs are charged to expense when incurred.

	Depreciable Life - Years
Leasehold improvements	Shorter of estimated lease term or 10 years
Furniture and fixtures	7 years
Computer equipment and software	5 years

Capitalized Software Costs

The Company capitalizes significant costs incurred in the development of software for internal use, including the costs of the software, materials, consultants, and payroll and payroll related costs for employees incurred in developing internal use computer software once final selection of the software is made. Costs incurred prior to the final selection of software and costs not qualifying for capitalization are charged to expense. The Company began amortizing the first generation of its platform on October 1, 2018 over a period of three years and recognized amortization expense of approximately $26,000 and $52,000 for the three and nine month periods ended March 31, 2019, respectively.

Income Taxes

In calculating the provision for interim income taxes, in accordance with Accounting Standards Codification (ASC) 740, Income Taxes, we apply an estimated annual effective tax rate to year-to-date ordinary income. At the end of each interim period, we estimate the effective tax rate expected to be applicable for the full fiscal year.

Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statement of operations in the period that includes the enactment date.

Risks and Uncertainties

The Company intends to operate in an industry subject to rapid change. The Company’s operations will be subject to significant risk and uncertainties including financial, operational, technological, and other risks associated with an early stage company, including the potential risk of business failure.

8

Amesite, Inc.

 Notes to Condensed Consolidated Financial Statements

Note 2 - Significant Accounting Policies (Continued)

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern.

The Company has incurred losses since inception, is still in the early stages of developing its service platform, and has not completed its efforts to establish a stabilized source of revenues sufficient to cover costs over an extended period of time. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent on its ability to raise additional capital and implement its business plan. Despite management’s ongoing efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Research and Development

Research and development expenditures are charged to expense as incurred. Research and development expense of approximately $0 and $94,000 was charged to expense during the three months and nine months ended March 31, 2019, respectively.

Net Loss per Share

Basic net loss per share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted loss per share includes potentially dilutive securities such as outstanding options and warrants, using various methods such as the treasury stock or modified treasury stock method in the determination of dilutive shares outstanding during each reporting period. For the three and nine months ended March 31, 2019, the Company had 1,091,833 and 292,114 potentially dilutive shares of common stock related to common stock options and common stock warrants, respectively, as determined using the if-converted method. For the three months ended March 31, 2018 and period of inception through March 31, 2018, the Company had 1,288,195 potentially dilutive shares of common stock related to common stock options, as determined using the if-converted method. For all periods presented, the dilutive effect of common stock options and common stock warrants has not been included in the average shares outstanding for the calculation of net loss per share as the effect would be anti-dilutive as a result of our net losses in this period.

Stock-Based Payments

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 “Compensation-Stock Compensation” requires companies to measure the cost of employee services received in exchange for the award of equity instruments based on the estimated fair value of the award at the date of grant. The expense is to be recognized over the period during which an employee is required to provide services in exchange for the award. The Company accounts for shares of common stock, stock options and warrants issued to employees based on the fair value of the stock, stock option or warrant, if that value is more reliably measurable than the fair value of the consideration or services received.

The Company accounts for stock options and restricted shares of common stock issued to non-employees in accordance with the FASB ASC Subtopic 505-50 “Equity-Based Payments to Non-Employees”. Accordingly, the fair value of the stock compensation issued to non-employees is based upon the measurement date as determined at the earlier of either a) the date at which a performance commitment is reached, or b) the date which the necessary performance to earn the equity instruments is complete. When a measurement date has not yet been reached for stock options and restricted shares of common stock outstanding held by non-employees, the Company remeasures these outstanding awards to fair value at each reporting period.

9

Amesite, Inc.

 Notes to Condensed Consolidated Financial Statements

Note 2 - Significant Accounting Policies (Continued)

Upcoming Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which will supersede the current revenue recognition requirements in Topic 605, Revenue Recognition. The ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The new guidance will be effective for the Company’s year beginning July 1, 2019 The standard is not expected to have a significant impact on the consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases, which will supersede the current lease requirements in ASC 840. The ASU requires lessees to recognize most leases on the balance sheet thereby resulting in the recognition of lease assets and liabilities for those leases currently classified as operating leases. ASU 2016-02 is effective beginning July 1, 2020 with early adoption permitted. The Company is continuing to assess the impact of ASU 2016-02. The Company’s primary impact to its consolidated financial position upon adoption will be the recognition, on a discounted basis, of minimum commitments under noncancelable operating leases on its consolidated balance sheet resulting in the recording of right of use assets and lease obligations. Current minimum commitments under noncancelable operating leases are disclosed in Note 5.

Note 3—Warrants

On April 27, 2018 and June 8, 2018, the Company issued 212,665 and 79,449 common stock warrants, respectively, to a placement agent related to fundraisings. The warrants have a term of five years from the closing date of the private placements and an exercise price of $1.50 per share. The Company measures the fair value of the warrants using the Black-Scholes Model (“BSM”).

The warrants are classified in stockholders’ equity of the Company.

The fair value of the warrants issued during the year ended June 30, 2018 was $203,615 based on the following inputs and assumptions using the BSM: (i) expected stock price volatility of 44.50%; (ii) risk-free interest rate of 2.86%; and (iii) expected life of warrants of 6 years.

The weighted-average exercise price of all warrants outstanding as of March 31, 2019 was $1.50 per share.

Note 4—Stock-Based Compensation

The Company’s Equity Incentive Plan (the “Plan”) permits the grant of stock options, stock appreciation rights, restricted stock, or restricted stock units to officers, employees, directors, consultants, agents, and independent contractors of the Company. The Company believes that such awards better align the interests of its employees, directors, and consultants with those of its stockholders. Option awards are generally granted with an exercise price equal to the market price of the Company’s stock at the date of grant; those option awards generally vest over two years from the grant date and generally have ten-year contractual terms. Certain option awards provide for accelerated vesting (as defined in the Plan).

The Company has reserved 2,529,000 shares of common stock to be available for granting under the Plan.

The Company estimates the fair value of each option award using a BSM that uses the weighted-average assumptions included in the table below. Expected volatilities are based on historical volatility of comparable companies. The Company uses historical data to estimate option exercise within the valuation model, or estimates the expected option exercise when historical data is unavailable. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company has not paid any dividends on common stock since its inception and does not anticipate paying dividends on its common stock in the foreseeable future. When calculating the amount of annual compensation expense, the Company has elected not to estimate forfeitures and instead accounts for forfeitures as they occur.

10

Amesite, Inc.

 Notes to Condensed Consolidated Financial Statements

Note 4 - Stock-Based Compensation (Continued)

A summary of option activity for the nine months ended March 31, 2019 is presented below:

Options	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)		Total Shares
Outstanding at July 1, 2018		947,917		$	1.50		10.0		947,917
Granted		270,916			1.50		9.30		270,916
Terminated		(127,000	)		1.50				(127,000	)
Outstanding at March 31, 2019		1,091,833			1.50		9.16		1,091,833

The weighted-average grant-date fair value of options granted during the three months and nine months ended March 31, 2019 was $0.70. The options contained time-based vesting conditions satisfied over a period of four years from the grant date.

The Company recognized $152,372 and $454,339 in expense related to the Plan for the three month and nine month period ended March 31, 2019, respectively. The expense is comprised of $61,250 for consulting services settled in restricted shares and $91,121 related to stock options for the three month period ended March 31, 2019. The expense is comprised of $183,750 for consulting services settled in restricted shares and $270,588 related to stock options for the nine month period ended March 31, 2019.

As of March 31, 2019, there was approximately $412,508 of total unrecognized compensation cost for employees and non-employees related to nonvested options. That cost is expected to be recognized over a weighted-average period of 1.25 years.

On July 13, 2018, the Company issued 340,278 restricted shares of common stock in exchange for consulting services provided during the period ended June 30, 2018, and for future services unrendered. The measurement date for all outstanding restricted shares may not be reached until the contractual end of the contract in September 2019. Accordingly, the Company has estimated the fair value of those services performed through March 31, 2019, and recorded an expense in the consolidated statements of operations. The expense is recognized ratably over the term of the consulting contract and amounted to $183,750 during the nine months ended March 31, 2019. As of March 31, 2019, there was approximately $122,500 of total unrecognized compensation cost for non-employees related to unrendered services. That cost is expected to be recognized over the remaining contractual period of approximately 6 months. The restricted shares are subject to various provisions that prevent the stockholders from selling, transferring or pledging the shares until the earlier of twelve months after the Company’s common stock is quoted and traded on public exchange or October 1, 2019.

11

Amesite, Inc.

 Notes to Condensed Consolidated Financial Statements

Note 5—Operating Lease

The Company is obligated under an operating lease primarily for its office. The lease requires the Company to pay insurance, utilities, and shared maintenance costs in addition to the monthly rent of $3,733 through May 2019. A refundable security deposit of $5,000 was also required as part of the lease. During March 2019, the lease was extended through May 2022 with monthly payments of $7,942 being due through May 2022.

Total rent expense was $52,541 for the nine months ended March 31, 2019.

The future minimum annual commitments under this operating lease are as follows:

Fiscal Year Ending June 30	Amount
2019	$	19,617
2020	$	95,304
2021	$	95,304
2022	$	79,420
	$	289,645

Note 6—Income Taxes

For the three and nine months ended March 31, 2019 and prior periods since inception, the Company’s activities have not generated any taxable income or tax liabilities. Accordingly, the Company has not recognized an income tax benefit for the three and nine months ended March 31, 2019.

The Company has approximately $2,178,000 of net operating loss carryforwards available to reduce future income taxes, of which approximately $17,000 of net operating loss carryforwards expire in 2037. Due to uncertainty as to the realization of the net operating loss carryforwards and other deferred tax assets as a result of the Company’s limited operating history and operating losses since inception, a full valuation allowance has been recorded against the Company’s deferred tax assets.

Note 7—Subsequent Events

The Company has evaluated the period subsequent to March 31, 2019 for any events that did not exist at the balance sheet date but arose after that date and determined that no subsequent events arose that should be disclosed in order to keep the financial statements from being misleading. 

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Our Business

We are an early stage technology company, partnering with colleges and universities to provide better higher education courses for large and growing online markets. We are building delivery platforms that will improve student engagement and performance through the strategic use of artificial intelligence technology.

Plan of Operation

Our current plan of operation includes launches with two new customers in the fiscal year ending June 30, 2019. Our current timeline for achieving such objective is as follows:

Period	Tasks	Costs	Source(s) of Funding
Quarter ending June 30, 2019	Launch of larger-scale products on our full-stack platform solution, with continued piloting and testing of both platforms in parallel for new and/or potential customers.	We anticipate spending approximately $1,350,000. Costs will primarily consist of internal salaries and contractor salaries, as well as cloud storage and third party software licenses.	Partly from funds remaining from the Private Placement and the Insider Investment, and partly from the proceeds of a contemplated equity offering before end of fiscal year 2019 (the “Contemplated Offering”).

Background on Merger

Lola One was incorporated in April 2017. Amesite OpCo was originally incorporated in the State of Delaware on November 14, 2017.

On April 27, 2018, Lola One’s wholly-owned subsidiary, Lola One Acquisition Sub, Inc. merged with and into Amesite OpCo, with Amesite OpCo remaining as the surviving entity and becoming our wholly-owned subsidiary (the “Merger”). Prior to the Merger, Lola One was a “shell” company registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), with no specific business plan or purpose. As a result of the Merger, Lola One acquired the operations of Amesite OpCo and continued the existing operations of Amesite OpCo as a company subject to the Exchange Act.

Following the Merger, Amesite OpCo changed its name to “Amesite Operating Company” and we adopted Amesite OpCo’s former company name, “Amesite Inc.”, as our company name, and changed our fiscal year end from May 31 to June 30. The Merger was accounted for as a reverse recapitalization for financial reporting purposes. Amesite OpCo was considered the acquirer for accounting purposes, and the historical financial statements before the Merger have been replaced with the historical financial statements of Amesite OpCo before the Merger in filings with the SEC.

As the result of the Merger and the change in our business and operations, a discussion of the past financial results of Lola One is not pertinent, and under applicable accounting principles the historical financial results of Amesite OpCo, the accounting acquirer, prior to the Merger are considered the historical financial results of our Company.

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Basis of Presentation

The following discussion highlights our results of operations and the principal factors that have affected our financial condition as well as our liquidity and capital resources for the three- and nine-month periods ended March 31, 2019, and provides information that management believes is relevant for an assessment and understanding of the statements of financial condition and results of operations presented herein.

The condensed consolidated financial statements contained herein have been prepared in accordance with accounting principles generally accepted in the United States of America and in consideration of SEC requirements. You should read the discussion and analysis together with such financial statements and the related notes thereto.

Since Amesite OpCo was incorporated on November 14, 2017, comparative data included in the financial statements and management discussion and analysis is for the period from November 14, 2017 to March 31, 2018.

Critical Accounting Policies and Significant Judgments and Estimates

The condensed consolidated financial statements are prepared in conformity with U.S. GAAP, which requires the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses in the periods presented. We believe the accounting estimates employed are appropriate and the resulting balances are reasonable; however, due to the inherent uncertainties in developing estimates, actual results could differ from the original estimates, requiring adjustments to these balances in future periods. The critical accounting estimates that affect the condensed consolidated financial statements and the judgments and assumptions used are consistent with those described in the MD&A section in our Transition Report on Form 10-K for the period ended June 30, 2018.

Results of Operations

Key Third Quarter Accomplishments

● Technology development. We integrated new features into our Gen 2  platform.

● Product launches. We launched products on our Gen 2 platform.

● Partner development. We announced two new partnerships and plans to launch products.

Revenue

We generated revenues of $2,831 and $3,576 during the three months and nine months ended March 31, 2019.

Operating Costs

Operating expenses for the three months and nine-months ended March 31, 2019 were $965,318 and $2,174,421, respectively. Operating costs for the periods primarily reflect payroll and related expenses (stock compensation expense of $152,372 and $454,339 for the three months and nine-months ended March 31, 2019) and contract services that support the development of our technology platforms.

Operating expenses for the period November 14, 2017 (date of incorporation) through March 31, 2018 were $144,725 and consisted primarily of general and administrative expenses in connection with the starting of the business.

Capital Expenditures

During the three months and nine-months ended March 31, 2019, we had capital asset additions of $161,735 and $769,000, respectively, which were comprised of $154,817 and $739,510, respectively in capitalized technology and content development, and $6,918 and $29,490 respectively of property and equipment, including primarily computer equipment, software, furniture and fixtures. The company will continue to capitalize significant software development costs, comprised primarily of internal payroll, payroll related and contractor costs, as we build out and complete our technology platforms.

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Capital asset additions of $12,900 were incurred for the period November 14, 2017 (date of incorporation) through March 31, 2018.

Financial position, liquidity, and capital resources

Overview

We are not currently profitable, and we cannot provide any assurance that we will ever be profitable. We incurred a net loss of $948,261 and $2,147,357 for the three months and nine-months ended March 31, 2019, and we incurred a net loss of $144,725 for the period from November 14, 2017 (date of incorporation) to March 31, 2018.

During the period from November 14, 2017 (date of incorporation) to June 30, 2018, we raised net proceeds of $4,809,546 from private equity financing transactions. As of March 31, 2019, our cash balance totaled $2,092,022.

At present, we believe that our cash balances should be sufficient to satisfy our anticipated operating and investing needs through July, 2019. However, it is possible that we will choose to accelerate our plan of operations in order to attract and sign more customers or to support current customers, and that we will require more funds than we currently have available to meet those needs.

ITEM 3. QUALITATIVE AND QUANTITATIVE DISCUSSION ABOUT MARKET RISK.

Not required for smaller reporting companies.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Quarterly Report on Form 10-Q, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer (our principal executive officer and our principal accounting officer), of the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (“Exchange Act”). Based on that evaluation, our management concluded that our disclosure controls and procedures were effective.

Changes in internal controls over financial reporting

During the period covered by this Quarterly Report on Form 10-Q, there were no changes in our internal control over financial reporting (as defined in Rule 13(a)-15(f) or 15(d)-15(f)) that occurred during the period covered by this quarterly report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

None.

ITEM 1A. RISK FACTORS.

Certain factors exist which may affect the Company’s business and could cause actual results to differ materially from those expressed in any forward-looking statements. The Company has not experienced any material changes from those risk factors as previously disclosed in the Company’s Transition Report on Form 10-K filed with the Securities and Exchange Commission on August 17, 2018.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

All unregistered sales of equity securities have previously been disclosed on our Current Reports on Form 8-K.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

None.

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ITEM 6. EXHIBITS.

Exhibit Number	Description of Exhibits
31.1	Certification of the Chief Executive Officer as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
31.2	Certification of the Chief Financial Officer as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
32.1	Certification of the Chief Executive Officer as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
32.2	Certification of the Chief Financial Officer as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
101	The following materials from our Quarterly Report on Form 10-Q for the quarter ended March 31, 2019 formatted in XBRL (eXtensible Business Reporting Language): (i) Balance Sheet, (ii) Statement of Operations, (iii) Statements of Cash Flows, (iv) Statements of Stockholders Equity and (v) related notes to these financial statements, tagged as blocks of text.*

* Filed herewith

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SIGNATURES

In accordance with Section 12 of the Securities Exchange Act of 1934, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: May 14, 2019	AMESITE INC.
	By:	/s/ Ann Marie Sastry, Ph.D.
		Ann Marie Sastry, Ph.D.
		Chief Executive Officer
		(Principal Executive Officer)
		/s/ Richard DiBartolomeo
		Richard DiBartolomeo
		Chief Financial Officer
		(Principal Financial Officer)

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