Sec Form 4 Filing - MARIO ERNEST @ Capnia, Inc. - 2014-11-18

Insider filing report for Changes in Beneficial Ownership
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FORM 4
Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP
Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940
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1. Name and Address of Reporting Person
MARIO ERNEST
2. Issuer Name and Ticker or Trading Symbol
Capnia, Inc. [ CAPN]
5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
X __ Director X __ 10% Owner
_____ Officer (give title below) _____ Other (specify below)
(Last) (First) (Middle)
C/O CAPNIA, INC., 3 TWIN DOLPHIN DR,, SUITE 160
3. Date of Earliest Transaction (MM/DD/YY)
11/18/2014
(Street)
REDWOOD CITY, CA94065
4. If Amendment, Date Original Filed (MM/DD/YY)
6. Individual or Joint/Group Filing (Check Applicable Line)
__ X __ Form filed by One Reporting Person
_____ Form filed by More than One Reporting Person
(City) (State) (Zip)
Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1.Title of Security
(Instr. 3)
2. Transaction Date (MM/DD/YY) 2A. Deemed Execution Date, if any (MM/DD/YY) 3. Transaction Code
(Instr. 8)
4. Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)
5. Amount of Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 3 and 4)
6. Ownership Form: Direct (D) or Indirect (I)
(Instr. 4)
7. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V Amount (A) or (D) Price
Common Stock 11/18/2014 C 48,885 A 48,885 D
Common Stock 11/18/2014 C 10,416 A 59,301 I See Footnote ( 2 )
Common Stock 11/18/2014 C 10,416 A 69,717 I See Footnote ( 3 )
Common Stock 11/18/2014 P 96,803 A 166,520 D
Common Stock 11/18/2014 P 53,512 A 220,032 I See Footnote ( 5 )
Common Stock 11/18/2014 P 114,072 A 334,104 I See Footnote ( 7 )
Common Stock 11/18/2014 P 44,770 A 378,874 I See Footnote ( 7 )
Common Stock 11/18/2014 P 253,846 A 632,720 I See Footnote ( 7 )
2010/2012 Convertible Promissory Notes 11/18/2014 S 471,191.66 D $ 815,721 D
2010/2012 Convertible Promissory Notes 11/18/2014 S 260,470.89 D $ 555,250.11 I See Footnote ( 5 )
2010/2012 Convertible Promissory Notes 11/18/2014 S 555,250.11 D $ 0 I See Footnote ( 7 )
2014 Convertible Promissory Notes 11/18/2014 S 203,705.06 D $ 0 I See Footnote ( 7 )
Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
( e.g. , puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 3)
2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (MM/DD/YY) 3A. Deemed Execution Date, if any (MM/DD/YY) 4. Transaction Code
(Instr. 8)
5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4, and 5)
6. Date Exercisable and Expiration Date
(MM/DD/YY)
7. Title and Amount of Underlying Securities
(Instr. 3 and 4)
8. Price of Derivative Security
(Instr. 5)
9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 4)
10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)
11. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
Series C Preferred Stock ( 1 ) 11/18/2014 C 48,885 ( 1 ) ( 1 ) Common Stock 48,885 $ 0 20,832 D
Series C Preferred Stock ( 1 ) 11/18/2014 C 10,416 ( 1 ) ( 1 ) Common Stock 10,416 $ 0 10,416 I See Footnote ( 2 )
Series C Preferred Stock ( 1 ) 11/18/2014 C 10,416 ( 1 ) ( 1 ) Common Stock 10,416 $ 0 0 I See Footnote ( 3 )
Warrant to Purchase Common Stock $ 4.8675 11/18/2014 J( 11 ) 13,690 ( 11 ) ( 11 ) Common Stock 13,690 $ 0 13,690 D
Warrant to Purchase Common Stock $ 4.8675 11/18/2014 J( 11 ) 8,275 ( 11 ) ( 11 ) Common Stock 8,275 $ 0 21,965 I See Footnote ( 7 )
Warrant to Purchase Common Stock $ 4.8675 11/18/2014 J( 11 ) 21,928 ( 11 ) ( 11 ) Common Stock 21,928 $ 0 43,893 I See Footnote ( 7 )
Series A Warrant to Purchase Common Stock $ 6.5 11/18/2014 P 44,770 11/18/2014 11/12/2019 Common Stock 44,770 ( 9 ) 44,770 I See Footnote ( 7 )
Series B Warrant to Purchase Common Stock $ 6.5 11/18/2014 P 44,770 11/18/2014 02/12/2016 Common Stock 44,770 ( 9 ) 89,540 I See Footnote ( 7 )
Series A Warrant to Purchase Common Stock $ 6.5 11/18/2014 P 253,846 11/18/2014 11/12/2019 Common Stock 253,846 ( 10 ) 343,386 I See Footnote ( 7 )
Series B Warrant to Purchase Common Stock $ 6.5 11/18/2014 P 253,846 11/18/2014 02/12/2016 Common Stock 253,846 ( 10 ) 597,232 I See Footnote ( 7 )
Reporting Owners
Reporting Owner Name / Address Relationships
Director 10% Owner Officer Other
MARIO ERNEST
C/O CAPNIA, INC., 3 TWIN DOLPHIN DR,
SUITE 160
REDWOOD CITY, CA94065
X X
Signatures
/s/ David O'Toole, Attorney-in-Fact for Ernest Mario 11/20/2014
Signature of Reporting Person Date
Explanation of Responses:
( 1 )The Series C Preferred Stock converted into shares of Common Stock on a 1:1 basis and had no expiration date.
( 2 )These shares are held directly by Ernest Mario 2008 Annuity Trust III ("E. Mario 2008 Trust"). Ernest Mario serves as trustee of the E. Mario 2008 Trust and may be deemed to be the beneficial owner of the shares held directly by E. Mario 2008 Trust. Ernest Mario disclaims beneficial ownership of the securities held by E. Mario 2008 Trust, except to the extent of such individual's pecuniary interests in the securities.
( 3 )These shares are held directly by Mildred Mario 2008 Annuity Trust III ("M. Mario 2008 Trust"). Ernest Mario and Ernest Mario's spouse, Mildred Mario, serves as trustees of the M. Mario 2008 Trust and may be deemed to be the beneficial owner of the shares held directly by M. Mario 2008 Trust. Ernest Mario disclaims beneficial ownership of the securities held by M. Mario 2008 Trust, except to the extent of such individual's pecuniary interests in the securities.
( 4 )Ernest Mario converted an aggregate of $471,191.66 in principal amount and accrued interest under the 2010/2012 Convertible Promissory Notes on November 18, 2014, at a conversion price of $4.8675 per share, resulting in an acquisition of 96,803 shares of Common Stock. The 2012/2012 Convertible Promissory Notes were convertible into shares of Common Stock at a conversion price equal to 75% of the market price of the Common Stock on the date of conversion, which was $6.49 per share of Common Stock.
( 5 )These shares are held directly by the Mario 2002 Grandchildren's Trust ("2002 Trust"). Ernest Mario serves as trustee of the 2002 Trust and may be deemed to be the beneficial owner of the shares held directly by 2002 Trust. Ernest Mario disclaims beneficial ownership of the securities held by 2002 Trust, except to the extent of such individual's pecuniary interests in the securities.
( 6 )The 2002 Trust converted an aggregate of $260,470.89 in principal amount and accrued interest under the 2010/2012 Convertible Promissory Notes on November 18, 2014, at a conversion price of $4.8675 per share, resulting in an acquisition of 53,512 shares of Common Stock. The 2012/2012 Convertible Promissory Notes were convertible into shares of Common Stock at a conversion price equal to 75% of the market price of the Common Stock on the date of conversion, which was $6.49 per share of Common Stock.
( 7 )These shares are held directly by Mario Family Partners LP ("MFP"). Ernest Mario serves as general partner of the MFP and may be deemed to be the beneficial owner of the shares held directly by MFP. Ernest Mario disclaims beneficial ownership of the securities held by MFP, except to the extent of such individual's pecuniary interests in the securities.
( 8 )MFP converted an aggregate of $555,250.11 in principal amount and accrued interest under the 2010/2012 Convertible Promissory Notes on November 18, 2014, at a conversion price of $4.8675 per share, resulting in an acquisition of 114,072 shares of Common Stock. The 2012/2012 Convertible Promissory Notes were convertible into shares of Common Stock at a conversion price equal to 75% of the market price of the Common Stock on the date of conversion, which was $6.49 per share of Common Stock.
( 9 )MFP converted an aggregate of $203,705.06 in principal amount and accrued interest under the 2014 Convertible Promissory Notes on November 18, 2014, at a conversion price of $4.55 per Unit, resulting in an acquisition of 44,770 Units. The 2014 Convertible Promissory Notes were convertible into Units at a conversion price equal to 70% of the market price of the Units being sold on the date of conversion, which was $6.50 per Unit, with each Unit consisting of (i) one share of Common Stock, (ii) one Series A Warrant to purchase one share of Common Stock, and (iii) one Series B Warrant to purchase one share of Common Stock.
( 10 )The reported securities are included within 253,846 Units purchased by MFP for $6.50 per Unit. Each Unit consists of (i) one share of Common Stock, (ii) one Series A Warrant to purchase one share of Common Stock, and (iii) one Series B Warrant to purchase one share of Common Stock.
( 11 )The 2010/2012 Warrants to Purchase Common Stock were issued in connection with the 2010/2012 Convertible Promissory Notes and on November 18, 2014, became exercisable for that number of shares of Common Stock as is equal to the quotient of (x) and (y), where (x) is equal to 25% of the principal amount of the corresponding 2010/2012 Convertible Promissory Note in connection with which such warrant was issued and which is referenced in footnotes 4, 6, and 8, and, (y) is equal to 75% of the market price of the Common Stock on November 18, 2014, which was $6.49 per share of Common Stock. The exercise price for each of the warrants is $4.8675 per share which is equal to 75% of the market price of the Common Stock on November 18, 2014, which was $6.49 per share of Common Stock. The 2010/2012 Warrants to Purchase Common Stock expire on either February 10, 2020 or January 17, 2022, as more particularly set forth in each 2010/2012 Warrant to Purchase Common Stock.

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