Stock split information

Since January 1, 2020, in preparation for the initial public offering (“IPO”) of its shares on Nasdaq, the Company has undertaken a reorganization of entities under common control. Pursuant to the terms of a share for share exchange agreement entered into on August 7, 2020, all shareholders of Compass Pathfinder Holdings Limited exchanged each of the shares held by them for 1,161 of the same class, with the same shareholder rights, of newly issued shares of Compass Rx Limited and, as a result, Compass Pathfinder Holdings Limited became a wholly owned subsidiary of Compass Rx Limited. This share exchange had the effect of a 1,161:1 reverse stock split. No other shareholder rights or preferences changed as a result of this reorganization. Subsequently, Compass Rx Limited was re-registered as a public limited company and renamed Compass Pathways plc, effective on August 21, 2020. There are no material differences between the financial information of Compass Pathways plc and Compass Pathfinder Holdings Limited, other than the impact of the share exchange, which had the effect of a reverse stock split and has been given retroactive application in these financial statements. Compass Pathways plc is a holding company with nominal activity. These transactions are detailed below:

Exchange of Compass Pathfinder Holdings Limited Shares for Compass Rx Limited Shares

Prior to the share exchange on August 7, 2020, the share capital of Compass Pathfinder Holdings Limited was divided into 83,025 ordinary shares of nominal value of £0.01 each; 20,100 preferred shares of nominal value of £0.01 each; 54,072 Series A preferred shares of nominal value of £0.01 each; 47,091 Series B preferred shares of nominal value of £0.01 each. On August 7, 2020, the shareholders of Compass Pathfinder Holdings Limited exchanged each of the shares held by them of Compass Pathfinder Holdings Limited for 1,161 of the same class, with the same shareholder rights, of shares in Compass Rx Limited. Following the share exchange, 96,392,025 ordinary shares, 23,336,100 preferred shares, 62,777,592 Series A preferred shares and 54,672,651 Series B preferred shares were outstanding, each with a nominal value of £0.01. 

Reduction of Capital of Compass Rx Limited

Pursuant to Part 17 of the Companies Act 2006, Compass Rx Limited reduced its share capital by way of a reduction of the nominal value of each share in the capital of Compass Rx Limited from £1.00 to £0.001 in order to satisfy the net asset test requirement in section 92 of the Companies Act 2006 for re- registration as a public limited company and to create distributable reserves. This reduction in capital reduced the nominal value of each share but did not change the number of issued shares in any class.

Re-registration of Compass Rx Limited as Compass Pathways plc and Reorganization of Shares in Compass Pathways plc

Following Compass Pathfinder Holdings Limited becoming a wholly owned subsidiary of Compass Rx Limited and following the capital reduction, Compass Rx Limited was re-registered as a public limited company and renamed Compass Pathways plc, which required the passing of special resolutions by the shareholders of Compass Rx Limited to approve the re-registration of Compass Rx Limited as a public limited company, the name change to Compass Pathways plc and the adoption of new articles of association of Compass Pathways plc.

Immediately prior to Compass Pathways plc’s Initial Public Offering, all of the outstanding preferred shares of nominal value £0.001 each, Series A preferred shares of nominal value £0.001 each and Series B preferred shares of nominal value £0.001 each converted on a one to one basis into an aggregate of 16,419,172 shares of a single class of ordinary shares of Compass Pathways plc.  Following this, the Company undertook a one-for-0.1136 reverse split on all of Compass Pathways plc’s ordinary shares of nominal value £0.001 each.  The fractional entitlements resulting from such reverse split were consolidated into one deferred share of £0.323 each. Following such reverse split there was a further sub-division of each ordinary share into one ordinary share of £0.008 each and one deferred share of £0.00080281690140845 each.  Following this, the deferred shares arising from the fractional entitlements and the sub-division were consolidated into one deferred share of £21,921.504 each and transferred to the Company for no consideration and which was subsequently cancelled.