Exhibit 99.2

Aadi Bioscience, Inc.

Index to Financial Statements

As of June 30, 2021 (unaudited) and December 31, 2020

and for the six months ended June 30, 2021 and 2020 (unaudited)

Contents

Unaudited Condensed Financial Statements
Condensed Balance Sheets as of June 30, 2021 (unaudited) and December 31, 2020	F-2
Condensed Statements of Operations and Comprehensive Loss—Six Months Ended June 30, 2021 and 2020 (unaudited)	F-3
Condensed Statements of Stockholders’ Equity (Deficit)—Six Months Ended June 30, 2021 and 2020 (unaudited)	F-4
Condensed Statements of Cash Flows for the Six Months Ended June 30, 2021 and 2020 (unaudited)	F-5
Notes to Unaudited Condensed Financial Statements	F-6

Aadi Bioscience, Inc.

Condensed Balance Sheets

	June 30, 2021			December 31, 2020
	(unaudited)
Assets
Current assets
Cash and cash equivalents	$	11,674,604		$	4,454,730
Account receivables		—			14,148,829
Prepaid expenses and other current assets		192,586			81,429
Total current assets		11,867,190			18,684,988
Property and equipment, net		16,291			20,773
Operating lease right-of-use assets		30,337			119,007
Deferred transaction costs		1,656,325			—
Total assets	$	13,570,143		$	18,824,768
Liabilities and stockholders’ deficit
Current liabilities
Accounts payable	$	4,378,023		$	2,391,996
Accrued liabilities		4,834,087			4,098,899
Payable to related party		14,314,473			14,314,473
Convertible promissory notes payable at fair value, current portion (includes related party amounts of $8,361,659 and $9,029,032, respectively)		9,374,927			9,029,032
Operating lease liabilities, current portion		36,854			124,723
Other current liabilities		—			98,816
Total current liabilities		32,938,364			30,057,939
Convertible promissory notes payable at fair value		—			1,101,627
Other liabilities		—			96,810
Total liabilities		32,938,364			31,256,376
Commitments and contingencies (Note 10)
Stockholders’ deficit:
Series Seed preferred stock, $0.0001 par value, 734,218 shares authorized, issued, and outstanding as of June 30, 2021 and December 31, 2020; aggregate liquidation preference of $1,101,327 as of June 30, 2021 and December 31, 2020		73			73
Series A preferred stock, $0.0001 par value; 7,211,948 shares authorized; 7,211,652 shares issued, and outstanding as of June 30, 2021 and December 31, 2020; aggregate liquidation preference of $28,926,144 and $28,432,867 as of June 30, 2021 and December 31, 2020, respectively		721			721
Common stock, $0.0001 par value; 20,000,000 shares authorized; 8,015,000 shares issued and outstanding as of June 30, 2021 and December 31, 2020		802			802
Additional paid-in capital		20,236,684			20,161,306
Accumulated deficit		(39,606,501	)		(32,594,510	)
Total stockholders’ deficit		(19,368,221	)		(12,431,608	)
Total liabilities and stockholders’ deficit	$	13,570,143		$	18,824,768

See accompanying notes to financial statements.

F-2

Aadi Bioscience, Inc.

Condensed Statements of Operations and Comprehensive Loss

	Six Months Ended June 30,
	2021			2020
	(unaudited)
Revenue
Grant revenue	$	119,561		$	199,943
Total revenue		119,561			199,943
Operating expenses
Research and development (includes related party amounts of $0 and $779,167, respectively)		6,688,756			7,289,204
General and administrative		1,393,420			1,199,813
Total operating expenses		8,082,176			8,489,017
Loss from operations		(7,962,615	)		(8,289,074	)
Other income (expense)
Change in fair value of convertible promissory notes		1,205,752			—
Gain upon forgiveness of Payroll Protection Plan loan		196,262			—
Interest income		814			39,759
Interest expense (includes related party amounts of $400,432 and $327,173, respectively)		(450,654	)		(356,707	)
Total other income (expense), net		952,174			(316,948	)
Loss before income tax expense		(7,010,441	)		(8,606,022	)
Income tax expense		(1,550	)		—
Net and comprehensive loss		(7,011,991	)		(8,606,022	)
Convertible preferred stock cumulative and undeclared dividends		(493,277	)		(493,277	)
Net loss and comprehensive loss attributable to common stockholders	$	(7,505,268	)	$	(9,099,299	)
Net and comprehensive loss per share basic and diluted	$	(0.94	)	$	(1.14	)
Weighted average number of common shares used in computing net loss per share attributable to common stockholders, basic and diluted		8,015,000			8,015,000

See accompanying notes to financial statements.

F-3

Aadi Bioscience, Inc.

Condensed Statements of Stockholders’ Equity (Deficit)

	For the Six Months Ended June 30, 2020 (unaudited)
	Series Seed Preferred Stock				Series A Preferred Stock				Common Stock
	Shares		Amount		Shares		Amount		Shares		Amount		Additional Paid-In Capital		Accumulated Deficit			Total Stockholders’ Deficit
Balance as of January 1, 2020		734,218	$	73		7,211,652	$	721		8,015,000	$	802	$	20,021,776	$	(29,117,038	)	$	(9,093,666	)
Share-based compensation expense														65,795					65,795
Net loss																(8,606,022	)		(8,606,022	)
Balance as of June 30, 2020		734,218	$	73		7,211,652	$	721		8,015,000	$	802	$	20,087,571	$	(37,723,060	)	$	(17,633,893	)

	For the Six Months Ended June 30, 2021 (unaudited)
	Series Seed Preferred Stock				Series A Preferred Stock				Common Stock
	Shares		Amount		Shares		Amount		Shares		Amount		Additional Paid-In Capital		Accumulated Deficit			Total Stockholders’ Deficit
Balance as of January 1, 2021		734,218	$	73		7,211,652	$	721		8,015,000	$	802	$	20,161,306	$	(32,594,510	)	$	(12,431,608	)
Share-based compensation expense														75,378					75,378
Net loss																(7,011,991	)		(7,011,991	)
Balance as of June 30, 2021		734,218	$	73		7,211,652	$	721		8,015,000	$	802	$	20,236,684	$	(39,606,501	)	$	(19,368,221	)

See accompanying notes to financial statements.

F-4

Aadi Bioscience, Inc.

Condensed Statements of Cash Flows

	For the Six Months Ended June 30,
	2021			2020
	(unaudited)
Cash flows from operating activities
Net loss	$	(7,011,991	)	$	(8,606,022	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Change in fair value of convertible promissory notes (includes related party amounts of $1,067,804 and $0, respectively)		(1,205,752	)		—
Non-cash interest expense (includes related party amounts of $400,432 and $327,173, respectively)		450,654			356,707
Gain on forgiveness of Payroll Protection Plan loan		(196,262	)		—
Share-based compensation expense		75,378			65,795
Non-cash lease expense		88,670			82,029
Depreciation expense		4,482			4,482
Changes in operating assets and liabilities:
Account receivables		14,148,829			184,923
Prepaid expenses and other current assets		(111,156	)		(44,027	)
Operating lease liability		(87,868	)		(96,021	)
Accounts payable and accrued liabilities		1,222,611			881,122
Payable to related party		—			779,167
Net cash provided by (used in) operating activities		7,377,595			(6,391,845	)
Cash flows from investing activities
Deferred acquisition costs paid		(156,700	)		—
Net cash used in investing activities		(156,700	)		—
Cash flows from financing activities
Deferred offering costs paid for PIPE financing		(1,021	)		—
Proceeds from issuance of convertible promissory notes		—			1,000,000
Proceeds from Payroll Protection Loan program		—			194,366
Net cash (used in) provided by financing activities		(1,021	)		1,194,366
Net increase (decrease) in cash and cash equivalents		7,219,874			(5,197,479	)
Cash and cash equivalents at beginning of period		4,454,730			15,961,923
Cash and cash equivalents at end of period	$	11,674,604		$	10,764,444
Supplemental disclosure of non-cash investing and financing activities:
Gain on forgiveness of Payroll Protection Plan loan	$	196,262		$	—
Deferred transaction costs included in accounts payable and accrued liabilities	$	1,498,604		$	—

See accompanying notes to financial statements.

F-5

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

1. Business and Business Organization

Description of Business

Aadi LLC was originally formed in the State of Delaware on September 29, 2011. Aadi LLC converted to Aadi Bioscience, Inc. (“Aadi” or the “Company”) and was incorporated in the State of Delaware on February 27, 2017. The Company is a privately-held, clinical stage biopharmaceutical company focused on development and commercialization of precision medicines targeted to rare mutation-driven diseases. Aadi’s initial focus is on the development of nab-sirolimus (sirolimus albumin-bound nanoparticles for injectable suspension, or “ABI-009”) for diseases driven by mTOR pathway activation through mutations or deletions of specific genes such as TSC1, TSC2 or PTEN. ABI-009 has a markedly different pharmacological and pharmacokinetic profile compared to any other mTOR inhibitor. ABI-009 is licensed to Aadi by Abraxis BioScience, LLC, a wholly owned subsidiary of Celgene Corporation, now Bristol Myers Squibb (“Celgene”), for all therapeutic areas including oncology, cardiovascular, and metabolic related diseases.

The Company commenced operations in 2014. Those operations have consisted principally of performing research and development activities and raising capital. The Company’s activities are subject to significant risks and uncertainties, including failing to secure additional funding before sustainable revenues and profit from operations are achieved.

Aerpio Merger Agreement

On May 16, 2021, the Company entered into an agreement and plan of merger (“Merger Agreement” or “Merger”) with Aerpio Pharmaceuticals, Inc. (“Aerpio”), a Delaware corporation. On August 26, 2021, the Merger was completed and the business of Aadi will continue as the business of the combined company. On August 27, 2021, the combined company’s common stock began trading on The Nasdaq Global Select Market under the ticker symbol “AADI”. The merger will be treated by Aerpio as a reverse asset acquisition under the acquisition method of accounting in accordance with U.S. generally accepted accounting principles (referred to as “GAAP”). For accounting purposes, Aadi is considered to be the accounting acquirer in this transaction.

In connection with the Merger Agreement, Aerpio entered into subscription agreements to raise an aggregate amount of $155.0 million in a Private Investment in Public Equity (“PIPE”) financing in shares of common stock to purchase Aerpio common stock. The PIPE financing was consummated concurrently with the closing of the Merger. The Merger is intended to qualify as a tax-free reorganization for U.S. federal income tax purposes

Effective on the closing date, current shareholders of Aadi own 65.8% and current shareholders of Aerpio will own 34.2% of the combined company upon the closing of the Merger, without giving effect to the PIPE. Following the closing of the PIPE financing, the former Aadi shareholders own 29.2% of the outstanding shares of Aerpio common stock, on a fully-diluted basis, the shareholders of Aerpio (as of immediately prior to the closing of the Merger) own 15.2% of the outstanding shares of Aerpio common stock, on a fully-diluted basis, and the PIPE investors own 55.6% of the outstanding shares of Aerpio common stock, on a fully-diluted basis.

The Merger Agreement contemplates contingent value rights which entitle the holder to receive a defined percentage of net proceeds, if any, received by the newly combined company with respect to certain Aerpio assets executed at the effective time of the Merger.

Pursuant to the closing of the Merger, the Company’s Board of Directors declared a 4% cumulative dividend on its preferred stock of $4.4 million. Other items contingent upon the closing of the Merger include payments for advisory fees of $11.4 million and one-time bonuses to key executives of $0.6 million.

F-6

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

Liquidity

Since inception, the Company has devoted substantially all of its resources to research and development activities, business planning, establishing and maintaining its intellectual property portfolio, hiring personnel, raising capital, and providing general and administrative support for these operations and has not realized revenues from its planned principal operations. The Company has incurred losses and negative cash flows from operations since inception. In addition, the Company expects to incur substantial operating losses for the next several years as it continues its research and development activities. As of June 30, 2021, the Company had cash and cash equivalents of $11.7 million.

Management plans to continue to incur substantial costs in order to conduct research and development activities and additional capital will be needed to undertake these activities. The Company intends to raise such capital through debt or equity financings or other arrangements to fund operations. Management believes that the Company’s current cash and cash equivalents, including the net PIPE proceeds of $145.4 million, concurrent with the closing of its merger with Aerpio, as described above, will provide sufficient funds to enable the Company to meet its obligations for at least twelve months from the filing date of this report.

COVID-19

In December 2019, a strain of coronavirus was reported in Wuhan, China and began to spread globally, including to the United States and Europe, in the following months. The World Health Organization has declared COVID-19 to be a global pandemic. The full impact of the COVID-19 pandemic is inherently uncertain at the time of this report. The COVID-19 pandemic has resulted in travel restrictions and, in some cases, prohibitions of non-essential activities, disruption and shutdown of businesses, and greater uncertainty in global financial markets. As COVID-19 has spread, it has significantly impacted the health and economic environment around the world, and many governments have closed most public establishments, including restaurants, workplaces, and schools. Aadi’s ongoing clinical trials have been, and may continue to be, affected by the closure of offices, or country borders, among other measures being put in place around the world. The inability to travel and conduct face-to-face meetings can also make it more difficult to enroll new patients in ongoing or planned clinical trials. Any of these circumstances will potentially have a negative impact on our financial results and the timing of our clinical trials.

The COVID-19 pandemic has caused the Company to modify business practices (including but not limited to curtailing or modifying employee travel, moving to full remote work, and cancelling physical participation in meetings, events, and conferences), and may take further actions as may be required by government authorities or that are determined to be in the best interests of the Company’s employees, patients, and business partners.

The extent of the impact of the COVID-19 pandemic on Aadi’s future liquidity and operational performance will depend on certain developments, including the duration and spread of the outbreak, the availability and effectiveness of vaccines, the impact on our clinical trials, patients, and collaboration partners, and the effect on our suppliers.

2. Related Party Transactions

Celgene License Agreement

On April 9, 2014, the Company entered into a license agreement (the “Celgene License Agreement”) with a wholly-owned subsidiary of Celgene, for exclusive rights for certain patents and a non-exclusive license for certain technology and know-how pertaining to ABI-009. The Celgene License Agreement will remain in effect from the effective date of April 9, 2014 until expiration of all milestone and royalty payment obligations under the agreement, unless terminated by either of the parties upon giving an advance notice as specified in the Celgene License Agreement. Under the terms of the Celgene License Agreement, Celgene agreed to supply the Company with licensed products of ABI-009 necessary for clinical or non-clinical development.

F-7

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

Celgene had the option to terminate the Celgene License Agreement and all of the Company’s related rights and licenses upon the occurrence of each of the following: (a) successful completion of the first Phase 2 Trial for a licensed product (“First Trigger Event”), or (b) if Celgene elects not to exercise its option upon the First Trigger Event, then upon the acceptance by the Food and Drug Administration or the European Medicines Agency, as applicable, of the first New Drug Application either in the United States or European Union, whichever occurs first, for a licensed product (“Second Trigger Event”). Celgene could also terminate the Celgene License Agreement upon written notice to the Company at any time following the occurrence of the First Trigger Event and prior to the occurrence of the Second Trigger Event (an “Early Exercise”). In each case, the termination would be subject to a payment to the Company by Celgene equal to the valuation of the Company as per the terms of the Celgene License Agreement. On October 3, 2016, the Celgene License Agreement was amended to include an option extension payment that allowed Celgene the option of paying $3.0 million to the Company to extend the period of time that Celgene had to Early Exercise. The Company has certain milestones that it is required to meet as specified in the Celgene License Agreement. If the Company fails to meet these milestones and cannot agree upon new terms and conditions, Celgene may terminate the Celgene License Agreement.

The Company paid Celgene a non-refundable initial fee of $125,000 in cash during 2014. Celgene is entitled to receive certain development milestone payments, royalties on net sales from licensed products under the agreement and any sublicense fees. No payments were made related to milestones or royalties under this agreement during the six months ended June 30, 2021 or 2020.

On May 1, 2019, Celgene terminated its rights to elect an option to terminate the Celgene License Agreement upon the occurrence of a First Trigger Event, Second Trigger Event or Early Exercise. As a result, the Company is free to negotiate and enter into any agreement with respect to an acquisition of all or substantially all of the business or assets of the Company whether by merger, sale of equity or assets, or otherwise and to consummate the same as it sees fit.

On November 15, 2019, Celgene and the Company entered into an amendment to the Celgene License Agreement (the “Amended Celgene License Agreement”) to terminate certain of Celgene’s ABI-009 product supply obligations and to transfer control over certain regulatory filings under the original Celgene License Agreement from Celgene to the Company. The Amended Celgene License Agreement also waived the obligations related to certain development milestone payments and waived the liability related to 2016 and 2017 licensed drug manufacturing costs of $1.2 million and $2.7 million, respectively.    

On December 8, 2020, the Company entered into a license agreement (“EOC License Agreement”) with EOC Pharma (Hong Kong) Limited (“EOC Pharma”) under which the Company received $14.0 million in January 2021 in non-refundable upfront consideration as partial payment for the rights and licenses granted to EOC by the Company for the further development and commercialization of ABI-009 in the People’s Republic of China, Hong Kong Special Administration Region, Macao Special Administrative Region and Taiwan (the “Licensed Territory”). In accordance with the Celgene License Agreement, the Company is required to pay 20% of all sublicense fees to Celgene. As such, the Company recognized $2.8 million of license expense with a related party in the fourth quarter of 2020 and had a corresponding $2.8 million sublicense payable in payable to related party in the balance sheet as of June 30, 2021 and December 31, 2020. Refer to Note 4 for additional information on the EOC License Agreement.

Convertible Notes

The Company issued convertible notes to existing equity holders in October 2019. In addition, the Company issued convertible notes in January 2020 (refer to Note 5 for additional information regarding the convertible notes).

F-8

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

3.    Summary of Significant Accounting Policies

Basis of Presentation

The accompanying condensed balance sheet as of June 30, 2021, and the condensed statements of operations and comprehensive loss, stockholders’ deficit and cash flows for the six months ended June 30, 2021 and 2020, and the related disclosures are unaudited. In management’s opinion, the unaudited interim condensed financial statements have been prepared on the same basis as the audited financial statements as of and for the year ended December 31, 2020 and included all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position and the results of its operations and cash flows in accordance with U.S. GAAP. The results for the six months ended June 30, 2021 are not necessarily indicative of the results expected for the full fiscal year or any other interim period.

Segment Information

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company views its operations and manages its business in one reportable operating segment, which is the business of developing and commercializing proprietary therapeutics. All the assets and operations of the Company’s sole operating segment are located in the United States.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities in the Company’s financial statements and accompanying notes. In the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation have been included. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may materially differ from these estimates and assumptions.

Concentration of Credit Risk

Financial instruments, which potentially subject the Company to concentration of credit risk, consist primarily of cash and cash equivalents and certain investments in money market funds. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. Management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. The Company has not experienced any losses on deposits since inception.

Cash and Cash Equivalents

The Company considers all highly liquid marketable securities purchased with original maturities of three months or less at the purchase date to be cash equivalents. As of June 30, 2021 and December 31, 2020, cash equivalents included money market investments totaling $3.0 million.

Fair Value Option

As permitted under the FASB Accounting Standards Codification (“ASC”) Topic 825, Financial Instruments, (“ASC 825”), the Company has elected the fair value option to account for its convertible promissory notes issued. In accordance with ASC 825, the Company records these convertible promissory notes at fair value with changes in fair value recorded in the statements of operations and comprehensive loss. As a result of applying the fair value option, direct costs and fees related to the convertible promissory notes were recognized in earnings as incurred and not deferred.

F-9

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

Fair Value of Financial Instruments

The accounting guidance defines fair value, establishes a consistent framework for measuring fair value, and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is defined as an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1: Observable inputs, such as quoted prices in active markets

Level 2: Inputs, other than the quoted prices in active markets that are observable either directly or indirectly

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions which reflect those that a market participant would use

Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels.

In determining the fair value of its financial instruments, the Company considers the source of observable market data inputs, liquidity of the instrument, the credit risk of the counterparty to the contract, and its risk of nonperformance. In the case fair value is not observable, for the items subject to fair value measurements, the Company applies valuation techniques deemed the most appropriate under the U.S. GAAP guidance based on the nature of the assets and liabilities being measured.

The carrying amounts of cash equivalents, account receivables, prepaid expenses, accounts payable, and accrued liabilities are reasonable estimates of their fair value because of the short maturity of these items.

The following table sets forth the fair value of the Company’s financial assets and liabilities, allocated into the Level 1, Level 2 and Level 3 hierarchy that were measured at fair value on a recurring basis:

	Fair Value Measurements as of June 30, 2021
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	3,040,896	$	—	$	—	$	3,040,896
Liabilities:
Convertible promissory notes	$	—	$	—	$	9,374,927	$	9,374,927
	Fair Value Measurements as of December 31, 2020
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	3,040,583	$	—	$	—	$	3,040,583
Liabilities:
Convertible promissory notes	$	—	$	—	$	10,130,659	$	10,130,659

F-10

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

As further described in Note 5, the Company issued convertible promissory notes in October 2019 and January 2020 (collectively the “Convertible Notes”). The Company elected the fair value option to account for the Convertible Notes. The fair value was estimated using a scenario-based analysis based on the probability-weighted value of expected future investment returns, considering possible outcomes available to the noteholders including conversions in subsequent equity financings, change of control transactions, settlement, and dissolution. The Company adjusts the carrying value of its Convertible Notes to their estimated fair value at each reporting date, with any related increases or decreases in the fair value recorded as a change in fair value of convertible promissory notes in the statements of operations and comprehensive loss.

As of June 30, 2021 and December 31, 2020, the significant unobservable inputs used in the fair value measurement of the Convertible Notes included an expected settlement date in August 2021 and June 2021, respectively, and an estimated discount rate of 25%. Other significant unobservable inputs include the relative weighting applied to the possible outcomes available to the noteholders including conversions in subsequent equity financings, change of control transactions, settlement, and dissolution.

There are significant judgments, assumptions and estimates inherent in the determination of the fair value of the convertible promissory notes described above. These include determination of a valuation method and selection of the possible outcomes available to the Company, including the determination of timing and expected future investment returns for such scenarios, as well as the likelihood of repayment, conversion, and dissolution. The related judgments, assumptions and estimates are highly interrelated and changes in any one assumption could necessitate changes in another. Any changes in the probability of a particular outcome would require a related change to the probability of another outcome.

The following table provides a reconciliation of the Convertible Notes (refer to Note 5) measured at fair value using significant unobservable inputs (Level 3):

	Convertible Notes (Level 3)
Balance as of December 31, 2019	$	8,164,885
Issuance of convertible promissory notes		1,000,000
Accrual of interest		356,707
Change in fair value of convertible promissory notes		—
Balance as of June 30, 2020	$	9,521,592
	Convertible Notes (Level 3)
Balance as of December 31, 2020	$	10,130,659
Issuance of convertible promissory notes		—
Accrual of interest		450,020
Change in fair value of convertible promissory notes		(1,205,752	)
Balance as of June 30, 2021	$	9,374,927

There have been no transfers between levels during the reporting periods.

Property and Equipment, Net

Property and equipment, which consist of computers, furniture and fixtures, and office equipment, are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets (generally five years).

F-11

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

Leases

The Company accounts for leases in accordance with ASC 842. At the inception of a contractual arrangement, the Company determines whether the contract contains a lease by assessing whether there is an identified asset and whether the contract conveys the right to control the use of the identified asset in exchange for consideration over a period of time. If both criteria are met, the Company records the associated lease liability and corresponding right-of-use asset upon commencement of the lease using the implicit rate or a discount rate based on a credit-adjusted secured borrowing rate commensurate with the term of the lease. The Company does not recognize assets or liabilities for leases with lease terms of less than 12 months.

The Company additionally evaluates leases at their inception to determine if they are to be accounted for as an operating lease or a finance lease. A lease is accounted for as a finance lease if it meets one of the following five criteria: the lease has a purchase option that is reasonably certain of being exercised, the present value of the future cash flows is substantially all of the fair market value of the underlying asset, the lease term is for a significant portion of the remaining economic life of the underlying asset, the title to the underlying asset transfers at the end of the lease term, or if the underlying asset is of such a specialized nature that it is expected to have no alternative uses to the lessor at the end of the term. Leases that do not meet the finance lease criteria are accounted for as an operating lease. Operating lease assets represent a right to use an underlying asset for the lease term and operating lease liabilities represent an obligation to make lease payments arising from the lease. Operating lease liabilities with a term greater than one year and their corresponding right-of-use assets are recognized on the balance sheets at the commencement date of the lease based on the present value of lease payments over the expected lease term.

Certain adjustments to the right-of-use asset may be required for items such as initial direct costs paid or incentives received. As the Company’s leases do not typically provide an implicit rate, the Company utilizes the appropriate incremental borrowing rate, determined as the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term and in a similar economic environment. For finance leases, depreciation expense is recognized for the leased asset acquired and interest expense is recognized related to the portion of the financing in the statements of operations. For operating leases, lease cost is recognized on a straight-line basis over the lease term and variable lease payments are recognized as operating expenses in the period in which the obligation for those payments is incurred. Variable lease payments primarily include common area maintenance, utilities, real estate taxes, insurance, and other operating costs that are passed on from the lessor in proportion to the space leased by the Company. The Company has elected the practical expedient to not separate between lease and non-lease components.

Account Receivables

Account receivables as of December 31, 2020 represents grant revenue recognized to date, but for which payment has not yet been received from the funding agency. The December 31, 2020 balance also includes $14.0 million receivable related to the EOC Pharma upfront payment. Estimates for allowances for doubtful accounts are determined based on existing contractual obligations and historical payment patterns. No allowance for doubtful accounts was recorded as of June 30, 2021 and December 31, 2020.

Revenue Recognition

Revenue Under License Agreement

The Company generates revenues from payments received under a license agreement. Under such license agreements, the Company recognizes revenue when it transfers promised goods or services to partners in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. To determine revenue recognition for contracts with partners, the Company performs the following five steps: (i) identifies the promised goods or services in the contract; (ii) identifies the performance obligations in the contract, including whether they are distinct in the context of the contract; (iii) determines the transaction price, including the constraint on variable consideration; (iv) allocates the transaction price to the performance obligations in the contract; and (v) recognizes revenue when (or as) the Company satisfies the performance obligations.

F-12

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

For revenue from such license agreements, the Company generally collects an upfront license payment from the license partner and is also entitled to receive event-based payments subject to the license partner’s achievement of specified development, regulatory and sales-based milestones. In addition, the Company is generally entitled to royalties if products under the license agreement are commercialized.

Transaction price for a contract represents the amount to which the Company is entitled in exchange for providing goods and services to the partner. Transaction price does not include amounts subject to uncertainties unless it is probable that there will be no significant reversal of revenue when the uncertainty is resolved. Apart from the upfront license payment, all other fees the Company may earn under such license agreements are subject to significant uncertainties of product development. Achievement of many of the event-based development and regulatory milestones may not be probable until such milestones are actually achieved. This generally relates to milestones such as obtaining regulatory approvals and successful completion of clinical trials. With respect to other development milestones, e.g. dosing of a first patient in a clinical trial, achievement could be considered probable prior to its actual occurrence, based on the progress towards commencement of the trial. The Company does not include any amounts subject to uncertainties into the transaction price until it is probable that the amount will not result in a significant reversal of revenue in the future. At the end of each reporting period, the Company re-evaluates the probability of achievement of such milestones and any related constraint, and if necessary, adjusts the estimate of the overall transaction price.

Because such agreements generally only have one type of performance obligation, a license, which is generally all transferred at the same time as agreement inception, allocation of the transaction price among multiple performance obligations is not required.

Upfront amounts allocated to licenses are recognized as revenue when the licenses are transferred to the partners. Development milestones and other fees are recognized in revenue when their occurrence becomes probable.

Grant Revenue

The Company’s grant revenues are derived from federal grants with the Food and Drug Administration. The Company has determined that the government agencies providing grants to the Company are not customers. Grant revenue is recognized when there is reasonable assurance of compliance with the conditions of the grant and reasonable assurance that the grant revenue will be received. The Company recognizes grant revenues as reimbursable grant costs are incurred. The costs associated with these reimbursements are reflected as a component of research and development expense in the accompanying statements of operations and comprehensive loss.

With respect to grant revenue derived from reimbursement of direct out-of-pocket expenses for research costs associated with federal contracts, where the Company acts as principal with discretion to choose suppliers, bears credit risk, and performs part of the services required in the transaction, the Company records revenue for the gross amount of the reimbursement. The costs associated with these reimbursements are reflected as a component of research and development expense in the accompanying statements of operations and comprehensive loss.

Research and Development Costs

Research and development expenses consist of costs incurred in performing research and development activities, including salaries and benefits, materials and supplies, preclinical expenses, stock-based compensation expense, contract services, and other external development expenses. The Company records research and development activities conducted by third-party service providers, which include work related to preclinical studies, clinical trials, and contract manufacturing activities, to research and development expense as incurred. The Company is required to estimate the amount of services provided but not yet invoiced and include these expenses in accrued expenses in the balance sheet and within research and development expenses in the statements of operations and comprehensive loss. These expenses are a significant component of the Company’s

F-13

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

research and development expenses and require significant estimates and judgments. The Company accrues for these expenses based on factors such as estimates of the work completed and in accordance with agreements established with its third-party service providers. As actual expenses become known, the Company adjusts its accrued expenses.

Commitments and Contingencies

The Company recognizes a liability with regard to loss contingencies when it believes it is probable a liability has occurred, and the amount can be reasonably estimated. If some amount within a range of loss appears at the time to be a better estimate than any other amount within the range, the Company accrues that amount. When no amount within the range is a better estimate than any other amount the Company accrues the minimum amount in the range. The Company has not recorded any such liabilities as of June 30, 2021 and December 31, 2020.

Income Taxes

Income taxes have been accounted for using the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates applicable 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 income in the period that includes the enactment date. A valuation allowance against deferred tax assets is recorded if, based upon the weight of all available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Share Based Compensation

Share-based compensation expense represents the cost of the grant date fair value of employee, non-employee, officer, and director stock option grants, estimated in accordance with the applicable accounting guidance, recognized on a straight-line basis over the vesting period. The vesting period generally approximates the expected service period of the awards. Forfeitures are recognized and accounted for as they occur.

The fair value of stock options is estimated using a Black-Scholes-Merton valuation model on the date of grant. This method requires certain assumptions be used as inputs, such as the fair value of the underlying common stock, expected term of the option before exercise, expected volatility of the Company’s common stock, expected dividend yield, and a risk-free interest rate. Options granted during the year have a maximum contractual term of ten years. The Company has limited historical stock option activity and therefore estimates the expected term of stock options granted to employees, officers, and directors using the simplified method, which represents the average of the contractual term of the stock option and its weighted-average vesting period. For options granted to non-employees, the Company uses the remaining contractual life. The expected volatility of stock options is based upon the historical volatility of a number of publicly traded companies in similar stages of clinical development. The Company has historically not declared or paid any dividends and does not currently expect to do so in the foreseeable future. The risk-free interest rates used are based on the U.S. Treasury yield in effect at the time of grant for zero-coupon U.S. treasury notes with maturities approximately equal to the expected term of the stock options.

Common Stock Valuation

Due to the absence of an active market for the Company’s common stock, the Company utilized methodologies in accordance with the framework of Standards 9 and 10 of the Uniform Standards of Professional Appraisal Practice, the Statement on Standards for Valuation Services as set forth by the American Institute of Certified Public Accountants (“AICPA”), the Statement of U.S. GAAP Codification of Accounting Standards Codification Topic 820: Fair Value Measurements and Disclosures, and the AICPA Accounting and Valuation Guide for the Valuation of Privately-Held-Company Equity Securities Issued as Compensation, to estimate the

F-14

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

fair value of its common stock. In determining the exercise prices for options granted, the Company has considered the fair value of the common stock as of the grant date. The fair value of the common stock has been determined based upon a variety of factors, including the illiquid nature of the common stock, arm’s-length sales of the Company’s common stock, the effect of the rights and preferences of the preferred stockholders, and the prospects of a liquidity event. Among other factors are the Company’s financial position and historical financial performance, the status of technological developments within the Company’s research, the composition and ability of the current research and management team, an evaluation or benchmark of the Company’s competition, and the current business climate in the marketplace. Significant changes to the key assumptions underlying the factors used could result in different fair values of common stock at each valuation date.

Deferred Transaction Costs

The Company has deferred transaction costs consisting of legal, accounting, and other fees and costs directly attributable to its planned merger. As of June 30, 2021, $1,656,325 of deferred transaction costs were recorded within other long-term assets on the balance sheet. No such costs were recorded on the balance sheet as of December 31, 2020.

Accounting Pronouncements Not Yet Adopted

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). This new guidance is intended to reduce the complexity of accounting for convertible instruments. The guidance also addresses how convertible instruments are accounted for in the diluted earnings per share calculation and requires enhanced disclosures about the terms of convertible instruments. Entities may adopt ASU 2020-06 using either a partial retrospective or fully retrospective method of transition. This ASU is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years for smaller reporting companies. The Company is currently evaluating the impact the adoption of ASU 2018-13 will have on the Company’s financial statements.

In April 2021, the FAB issued ASU 2021- 04, which included Topic 260 “Earnings Per Share.” This guidance clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options due to a lack of explicit guidance in the FASB Codification. ASU 2021-04 is effective for all entities for fiscal years beginning after December 15, 2021. Early adoption is permitted. The Company is currently evaluating the impact of adopting ASU 2021-04 on its financial statements.

4. EOC License Agreement

In December 2020, the Company entered into the EOC License Agreement with EOC Pharma for the further development and commercialization of ABI-009 in the Licensed Territory. Under the terms of the EOC License Agreement, Aadi granted to EOC Pharma an exclusive, royalty-bearing license to develop and commercialize the product in the Licensed Territory.

Unless earlier terminated, the term of the EOC License Agreement continues until the expiration of the royalty obligations. Prior to the expiration of the EOC License Agreement, EOC Pharma has the right to terminate the agreement for any reason upon 120 days advance written notice. Either party may terminate the EOC License Agreement in the event that the other party breaches the agreement and fails to cure the breach, becomes insolvent or challenges certain of the intellectual property rights licensed under the agreement.

The Company received a $14.0 million upfront payment in January 2021 and is eligible to receive an additional $257.0 million in the aggregate upon achievement of certain development, regulatory, and sales milestones, as well as tiered royalties on net sales in the Licensed Territory. Under the terms of the EOC License Agreement, EOC Pharma will fund all research, development, regulatory, marketing and commercialization activities in the defined Licensed Territory.

F-15

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

The Company assessed the EOC License Agreement with EOC Pharma in accordance with FASB ASC Topic 606 and concluded that EOC Pharma is a customer. Additionally, the Company identified the license of ABI-009 provided to EOC Pharma as the sole performance obligation. The $14.0 million upfront payment received from EOC Pharma is non-refundable and non-creditable and is considered fixed consideration.

Both the milestones and royalty payments under the EOC License Agreement are considered variable consideration. Under the “most-likely” method, the Company will apply a constraint to these amounts until it has received notification from EOC Pharma that the milestones and royalty payments have been achieved.

5. Convertible Notes

The Company received $8.1 million in October 2019 and $1.0 million in January 2020 for the proceeds from the issuance of Convertible Notes. The October 2019 Convertible Notes were issued to existing equity holders. The Convertible Notes issued in October 2019 and January 2020 originally had a maturity date of one year from the date of issuance and bear an escalating interest rate of 6% per annum for the first four months following the effective date of the loan agreement, 8% per annum for the fifth and sixth months, and 10% per annum for the remaining six months of the note term until maturity at twelve months. The Convertible Notes contain certain redemption features, including conversion to preferred stock upon the closing of the Company’s next issuance of preferred stock resulting in net proceeds to the Company of at least $25.0 million (“Qualified Financing”). The Convertible Notes will convert into a variable, whole number of preferred shares equal to the number obtained by dividing the principal plus accrued interest of the Convertible Notes by 80% of the price per share paid by cash investors in the Qualifying Financing if converted in the first four months following the effective date of the loan agreement, 75% if converted in months five or six, and 70% if converted later than six months. The Convertible Notes also contain a mandatory prepayment provision that requires the Company to pay the outstanding principal, plus accrued and unpaid interest together with a premium in the event that a qualified liquidity event occurred. The premium is equal to 120% of the outstanding principal amount to be prepaid in the event the liquidity event occurs within four months of the note date, 130% between the fifth and sixth month, and 140% if after the sixth month but prior to maturity.

In November 2020, the Company entered into an amendment to the October 2019 and January 2020 Convertible Notes, whereby the term was extended from one year to two years. The amendment was accounted for as a debt modification.

In May 2021, the Company entered into an amendment to the October 2019 and January 2020 Convertible Notes, whereby upon the closing of the merger (see Note 1), the outstanding principal amount of this Note and all accrued and unpaid interest on this Note as of immediately prior to the closing of the Merger shall automatically convert into fully paid and nonassessable shares of common stock of the Company at a price per share equal to $4.80. The terms of the amendment remain in force and effect until the closing of the merger on August 26, 2021.

In conjunction with the closing of the Merger on August 26, 2021, the outstanding Convertible Notes were converted into 698,018 shares of common stock.

6. Payroll Protection Program Loan

On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”). The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property. The CARES Act also appropriated funds for the Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”) loans that are forgivable in certain situations to promote continued employment, as well as Economic Injury Disaster Loans to provide liquidity to small businesses harmed by COVID-19.

F-16

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

In May 2020, Aadi was approved for a $194,366 SBA PPP loan, as provided for in the CARES Act (“PPP Loan”). Under certain conditions, the PPP Loan and accrued interest are forgivable after a twenty-four-week covered period as long as the loan proceeds were used for eligible expenses, including payroll, benefits, rent and utilities, and the company maintains certain payroll levels. The amount of loan forgiveness is subject to reduction if the Company terminates employees or reduces salaries during the twenty-four-week covered period. The unforgiven portion of the loan is payable over two years at an interest rate of 1%, with a deferral of payments for the ten months following the end of the twenty-four-week covered period. On April 29, 2021, the Company received notification from the SBA that the Company’s Forgiveness Application of the PPP Loan and accrued interest was approved in full, and the Company had no further obligations related to the PPP Loan. Accordingly, the Company recorded a gain on the forgiveness of the PPP Loan totaling $196,262 including accrued interest of $1,896.

The SBA has stated that all PPP loans in excess of $2 million, and other PPP loans as appropriate, will be subject to review by the SBA for compliance with program requirements. If the SBA determines in the course of its review that a borrower lacked an adequate basis for the required certification concerning the necessity of the loan request or the subsequent use of loan proceeds, the SBA will seek repayment of the PPP loan, including interest and potential penalties. While the Company believes the loan was properly obtained and forgiven, there can be no assurance regarding the outcome of an SBA review. The Company has not accrued any liability associated with the risk of an adverse SBA review.

7. Stockholders’ Deficit

Under the Amended and Restated Certificate of Incorporation dated March 29, 2017, the Company had a total of 27,946,166 shares of capital stock authorized for issuance, consisting of 20,000,000 shares of Common Stock, par value of $0.0001 per share, and 7,946,166 shares of Preferred Stock, par value of $0.0001 per share. Of the 7,946,166 shares of authorized Preferred Stock, 734,218 are designated Series Seed Preferred Stock and 7,211,948 shares are designated Series A Preferred Stock.

Series Seed Preferred Stock

On February 23, 2017, the Company converted from a limited liability company to a corporation and at that time converted 734,218 membership units into shares of Series Seed Preferred Stock. As of June 30, 2021 and December 31, 2020, all of the 734,218 shares of designated Series Seed Preferred Stock were issued and outstanding.

Series A Preferred Stock

In February and March 2017, the Company sold and issued in a private placement 5,847,940 shares of Series A Preferred Stock at $3.42 per share (the “Series A Financing”). Upon the closing of the Series A Financing, convertible notes issued in 2015 converted into 482,426 shares of Series A Preferred Stock at 85% of the $3.42 price per share (the “Series A Original Issue Price”) paid by the Series A Financing investors. Convertible notes issued in 2017 converted into 881,286 shares of Series A Preferred Stock at the Series A Original Issue Price. As of June 30, 2021 and December 31, 2020, of the 7,211,948 shares designated as Series A Preferred Stock, 7,211,652 shares were issued and outstanding.

Common Stock

On February 23, 2017, the Company converted from a limited liability company to a corporation and at that time converted 8,015,000 membership units to shares of Common Stock. As of June 30, 2021 and December 31, 2020, of the authorized 20,000,000 shares of Commons Stock, 8,015,000 shares were issued and outstanding. The voting, dividend, and liquidation rights of the holders of the Common Stock are subject to and qualified by the rights, powers, and preferences of the holders of the Preferred Stock. The holders of the Common Stock are entitled to one vote for each share of Common Stock held at all meetings of stockholders.

F-17

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

The Company’s preferred stock has the following characteristics:

Dividends

Holders of Series A Preferred Stock, in preference to the holders of Common Stock and Series Seed Preferred Stock, shall be entitled to receive cumulative dividends at the annual accrual rate of 4% of the Series A Original Issue Price. Such dividends shall accrue from day to day, however, shall be payable only when and if declared by the Company’s Board of Directors. There have been no dividends declared by the board as of June 30, 2021 and December 31, 2020. Upon conversion of the shares of Series A Preferred Stock into Common Stock, the Company shall pay accrued but unpaid dividends on the Series A Preferred Stock converted either in shares of Common Stock at the fair market value in effect at the time of conversion or in cash, as determined by the Board of Directors.

Liquidation

The holders of the Series A Preferred Stock are entitled to receive liquidation preferences at the Series A Original Issue Price of $3.42, plus all accrued but unpaid dividends, whether or not declared. Liquidation payments to the holders of Series A Preferred Stock have priority and are made in preference to any payments to the holders of Series Seed Preferred Stock and Common Stock.

After full payment of the liquidation preference to the holders of the Series A Preferred Stock, the remaining assets, if any, will be distributed ratably to the holders of the Series Seed Preferred Stock at an amount per share equal to the greater of (a) the Series Seed Original Issue Price of $1.50 (the “Series Seed Original Issue Price”), plus any dividends accrued or declared but unpaid, or (b) such amount per share as would have been payable had all shares of Series Seed Preferred Stock been converted into Common Stock.

After full payment of the liquidation preference to the holders of the Series A Preferred Stock and Series Seed Preferred Stock, the remaining assets, if any, will be distributed ratably to the holders of the Series A Preferred Stock, Series Seed Preferred Stock, and Common Stock on an as-if-converted to Common Stock basis.

Conversion Rights

The shares of Series A Preferred Stock and Series Seed Preferred are convertible, at the option of the holder of such Series A Preferred Stock and Series Seed Preferred, at any time, into such number of shares of common stock as is determined by dividing the original issue price for such series of Series A Preferred Stock or Series Seed Preferred Stock, as applicable, by the conversion price for such series in effect at the time of conversion. The conversion price for the Series A Preferred Stock and Series Seed Preferred Stock, as applicable, initially means the original issue price for such series. The initial conversion price for the Series A Preferred Stock, and the rate at which shares of Series A Preferred Stock may be converted into shares of common stock, shall be subject to adjustment for dividends, stock splits, and other distributions. The conversion rate as of June 30, 2021 and December 31, 2020 for the Series A Preferred Stock and Series Seed Preferred Stock was 1:1.

Each share of Series A Preferred Stock and Series Seed Preferred Stock is automatically converted into common stock at the then effective conversion rate (A) at any time upon the affirmative election of the holders of at least a majority of the outstanding shares of the Series A Preferred Stock, or (B) immediately upon the closing of a firmly underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended, covering the offer and sale of Common Stock for the account of the Company in which (i) the public offering price per share is at least three times the applicable Series A Original Issue Price (subject to appropriate adjustment in the event of a stock split, stock dividend, combination, reclassification, or similar event affecting the Series A Preferred Stock), (ii) the gross cash proceeds to the Company (before underwriting discounts, commissions and fees) are at least $30 million and (iii) the Company’s shares have been listed for trading on the New York Stock Exchange, NASDAQ Global Select Market or NASDAQ Global Market.

In conjunction with the closing of the Merger on August 26, 2021, the shares of the Series A Preferred Stock and Series Seed Preferred were converted into 2,520,425 shares of common stock.

F-18

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

Redemption Rights

The holders of Preferred Stock do not have any redemption rights.

Voting

Each holder of Series A Preferred Stock or Series Seed Preferred Stock shall be entitled to cast the number of votes equal to the number of whole shares of common stock into which the shares of Series A Preferred Stock or Series Seed Preferred Stock held by such holder are convertible. Except as provided by law or by the other provisions of the Company’s governance documents, holders of Series A Preferred Stock and Series Seed Preferred Stock shall vote together with the holders of Common Stock as a single class.

8. Net Loss Per Share

Basic and diluted net loss attributable to common stock is presented in conformity with the two-class method required for participating securities as the Series A convertible preferred stock is considered a participating security. The Company’s participating securities do not have a contractual obligation to share in the Company’s losses. As such, the net loss was attributed entirely to common stock.

Basic net loss per share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares and common share equivalents outstanding for the period. Common stock equivalents are only included when their effect is dilutive. The Company’s potentially dilutive securities, which include convertible preferred stock and outstanding stock options under the Company’s equity incentive plan have been excluded from the computation of diluted net loss per share as they would be anti-dilutive. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss position.

The following table summarizes the Company’s net loss per share:

	Six Months Ended June 30,
	2021			2020
Numerator:
Net loss and comprehensive loss available to common stockholders	$	(7,505,268	)	$	(9,099,299	)
Denominator:
Weighted-average common stock outstanding, basic and diluted		8,015,000			8,015,000
Net loss per share, basis and diluted	$	(0.94	)	$	(1.14	)

F-19

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

The following table sets forth the outstanding potentially dilutive securities that have been excluded in the calculation of diluted net loss per share because their inclusion would be anti-dilutive:

	June 30, 2021		December 31, 2020
Series Seed convertible preferred stock		734,218		734,218
Series A convertible preferred stock		7,211,652		7,211,652
Common stock options		1,415,000		1,232,500

9. Share-Based Compensation

Stock Option Plan

In February 2017, the Company approved the Amended and Restated 2014 Equity Incentive Plan (the “Amended and Restated 2014 Plan”). The Amended and Restated 2014 Plan provides for the issuance of 1,485,000 shares of Common Stock to officers, directors, employees, non-employee directors, and consultants of the Company. The Amended and Restated 2014 Plan allows for the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock unit awards and other stock awards. There were 70,000 and 252,500 options remaining available for future issuance under the Amended and Restated 2014 Plan as of June 30, 2021 and December 31, 2020, respectively.

The options that are granted from the Amended and Restated 2014 Plan are exercisable at various dates as determined upon grant and will expire no more than ten years from their date of grant. Stock options generally vest over a four-year term. The exercise price of each option shall be determined by the Board of Directors, although generally options have an exercise price equal to the fair market value of the Company’s stock on the date of the option grant. In the case of incentive stock options, the exercise price shall not be less than 100% of the fair market value of the Company’s common stock at the time the option is granted. For holders of more than 10% of the Company’s total combined voting power of all classes of stock, incentive stock options may not be granted at less than 110% of the fair market value of the Company’s common stock at the date of grant and for a term not to exceed five years.

During the six months ended June 30, 2021, there were 182,500 stock options granted. During the six months ended June 30, 2020, there were 167,500 stock options granted. The weighted average grant date fair value of options granted during the six months ended June 30, 2021 was $1.97. The fair value of stock options granted during the six months ended June 30, 2021 and 2020 was estimated at the grant date using the following assumptions:

	Three Months Ended June 30,		Six Months Ended June 30,
	2021	2020	2021	2020
Risk-free interest rate	0.90% - 1.08%	0.34%	0.90% - 1.08%	0.34% - 0.80%
Expected volatility	85.21% - 87.88%	89.57%	85.21% - 87.88%	89.57% - 92.52%
Expected term (in years)	5.08 - 6.25	5.27	5.08 - 6.25	5.27 - 6.25
Expected dividend yield	0%	0%	0%	0%

The Company recognized stock-based compensation of $75,378 and $65,795 for the six months ended June 30, 2021 and 2020, respectively. The total unrecognized compensation cost related to outstanding unvested stock-based awards as of June 30, 2021 was $538,972, which is expected to be recognized over a weighted-average remaining service period of 1.42 years.

F-20

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

The following table summarizes the option activity under the 2014 Plan for the six months ended June 30, 2021:

	Stock Option Shares		Weighted Average Exercise Price		Average Remaining Contractual Term (in Years)		Aggregate Intrinsic Value
Outstanding, January 1, 2021		1,232,500	$	0.67		7.26	$	505,250
Granted		182,500		2.73		9.92
Exercised		—		—		—
Expired/canceled		—		—		—
Outstanding, June 30, 2021		1,415,000	$	0.94		6.99	$	2,538,875
Expected to vest, June 30, 2021		888,436	$	0.58		5.98	$	1,906,788
Options exercisable, June 30, 2021		1,415,000	$	0.94		6.99	$	2,538,875

All outstanding options are vested or expected to vest.

Common Stock Reserved for Future Issuance

Common stock reserved for future issuance consisted of the following as of June 30, 2021 and December 31, 2020:

	June 30, 2021		December 31, 2020
Common stock options granted and outstanding		1,415,000		1,232,500
Common stock reserved for future option grants		70,000		252,500
Total common stock reserved for future issuance		1,485,000		1,485,000

As of June 30, 2021, 70,000 shares authorized under the 2014 Plan were available for future awards.

10. Commitments and Contingencies

Operating Lease

In April 2019, the Company entered into a twenty-eight-month facility lease agreement for 2,760 square feet of office space in Los Angeles, California. The lease commenced on May 1, 2019 and is scheduled to expire on August 31, 2021. The lease contains an option to extend the term for one additional three-year period. The lease includes four months of rent abatement and a rent escalation clause. Rent expense is being recorded on a straight- line basis. Rent expense related to this lease was $0.1 million for the six months ended June 30, 2021 and 2020.

The following table summarizes information related to leases:

	June 30, 2021		December 31, 2020
Assets:
Operating lease right-of-use assets	$	30,337	$	119,007
Total right-of-use assets	$	30,337	$	119,007
Liabilities:
Operating lease liabilities, current	$	36,854	$	124,723
Operating lease liabilities, non-current		—	$	—
Total operating lease liabilities	$	36,854	$	124,723

F-21

Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

The future minimum lease payments required under the operating lease as of June 30, 2021, are summarized as follows:

Year Ending December 31, 2021 (remaining 2 months)	$	36,957
2022		—
2023		—
2024		—
Total minimum lease payments	$	36,957
Less: amount representing interest		(103	)
Present value of operating lease liabilities	$	36,854
Less: operating lease liabilities, current	$	36,854
Operating lease liabilities, non-current		—
Remaining lease term (in years)		0.2
Incremental borrowing rate		6.8	%

Litigation

On June 30, 2021, a purported stockholder of the Aerpio Pharmaceuticals, Inc. (“Aerpio”) filed a complaint in the United States District Court for the Southern District of New York, captioned Dwayne Komurke v. Aerpio Pharmaceuticals Inc., et al., Case No. 1:21-cv-05686 (the “Komurke complaint”), naming Aerpio, the Aerpio Board of Directors, as of the date of the Merger Agreement, Merger Sub and Aadi Bioscience, Inc. as defendants.

The Komurke complaint alleges, among other things, that the Merger consideration is inadequate and that Aerpio’s proxy statement filed with the SEC on June 21, 2021 in connection with the Merger (the “preliminary proxy statement”), is materially incomplete and misleading by allegedly failing to disclose in violation of Section 14(a) and Section 20(a) of the Exchange Act, as well as Rule 14a-9 promulgated thereunder, certain allegedly material information, including (i) the process leading up to the Merger; (ii) certain financial projections prepared by Aerpio’s management and summarized in the preliminary proxy statement; and (iii) certain inputs and assumptions used in the financial analyses conducted by Ladenburg in connection with rendering its fairness opinion to Aerpio’s Board of Directors. The Komurke complaint asserts claims for breach of fiduciary duty against Aerpio’s Board of Directors; aiding and abetting breaches of fiduciary duty of the Aerpio, Merger Sub and Aadi Bioscience, Inc.; violations of Section 14(a) and Rule 14a-9 against all defendants; and violations of Section 20(a) against Aerpio’s Board of Directors. The relief sought in the Komurke complaint includes equitable relief, including among other things, to enjoin the consummation of the Merger, to rescind the Merger Agreement, to the extent already implemented, or to recover rescissory damages, to direct the defendants to commence a new sale process, to direct the defendants to disseminate a proxy statement that includes certain additional and allegedly material information, to direct the defendants to account to plaintiff for all alleged damages suffered as a result of their alleged wrongdoing and to award plaintiff the cost of the stockholder complaint, including reasonable attorneys’ and expert fees.

The plaintiff in Komurke has voluntarily dismissed their complaint without prejudice on September 13, 2021.

11. Subsequent Events

Payable to Related Party

On August 30, 2021, the Company entered into an Amended and Restated License Agreement (the “License Agreement”) with a related party. Pursuant to the terms of the Amended and Restated License Agreement, total payment obligations of $8.5 million were paid on September 3, 2021 that relate to balances previously accrued as of June 30, 2021. Included in the subsequent payment was the $2.8 million sublicense fee to Celgene referenced in Note 2.

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Aadi Bioscience, Inc.

Notes to Condensed Financial Statements

(Unaudited)

Lease Agreement

On August 30, 2021, the Company entered into an amended lease agreement for its office space. Pursuant to the amended lease agreement, the Company and the Landlord agreed to extend the term of the Lease, which was previously set to expire on August 31, 2021, for an additional period of three (3) years and six (6) months, until February 28, 2025, for all spaces covered by the Lease, with an option to renew for an additional three (3) years in accordance with the terms of the Lease.

Share-Based Compensation

On August 26, 2021, the Company approved the Company’s 2021 Equity Incentive Plan (the “2021 Plan”). Under the 2021 Plan, the Company granted 87,745 options to directors of the Company and 532,186 options to both officers and directors of the Company in August 2021 and September 2021, respectively.

F-23