Stockholders' Equity (Deficit)

6 Months Ended

Jun. 30, 2025

NOTE 11 — STOCKHOLDERS’ EQUITY (DEFICIT)

Common Stock

Pursuant to the Company's certificate of incorporation, as amended, it is authorized to issue 250,000,000 shares of Common Stock. As of June 30, 2025 and December 31, 2024, the Company had 1,483,738 and 696,969, respectively, shares of Common Stock issued and outstanding and no shares of preferred stock issued and outstanding.

In May 2025, the Company sold 479,621 shares of its Common Stock at prices ranging from $3.36 to $4.09 (with an average price of $4.08) per share through an at-the-market equity offering facility (the “ATM Financing”). Gross proceeds from the sale of Common Stock under the ATM Financing totaled $1.96 million, prior to deducting fees of $0.06 million paid to the sales agent, Brookline Capital Markets, a division of Arcadia Securities, LLC ("Brookline"), and other offering expenses of $0.14 million payable by the Company. A member of the Company's board of directors is a managing partner of Brookline.

Upon the Closing, the Elevai Consideration included 38,308 shares of Common Stock and 3,927 additional shares of Common Stock to be withheld by the Company for 12 months after the Closing to secure the indemnification obligations of the Seller and the Parent under the Asset Purchase Agreement. These shares had fair values of $660,805 and $67,742, respectively. The withheld shares are disclosed as Consideration Payable on the unaudited condensed consolidated balance sheet as of June 30, 2025.

On January 2, 2025, the Company sold and issued (i) an aggregate of 268,840 shares of Common Stock at an offering price of $6.90 per share, and (ii) warrants to purchase up to an aggregate of 268,840 shares of Common Stock at an exercise price of $6.90 (the “Common Stock Warrants”) in a private placement (the “2025 Private Placement”). The aggregate gross proceeds from the 2025 Private Placement were approximately $1.85 million, before deducting fees of $0.19 million paid to the placement agent, Brookline (the “Placement Agent”), and other offering expenses of approximately $0.3 million.

The Common Stock Warrants have a five-year term and became exercisable upon shareholder approval, which occurred in March 2025. The Common Stock Warrants also contain certain provisions that, in the event of a stock split, result in the exercise price and number of shares of Common Stock issuable upon exercise of such warrants being subject to a proportionate adjustment, as well as a down-round provision. In connection with the closing of the 2025 Private Placement, the Company issued a warrant to purchase an aggregate of 18,553 shares of Common Stock to the Placement Agent (the “Placement Agent Warrant”). The Placement Agent Warrant has an exercise price of $6.90 and a term of five years, and became exercisable six months after issuance. The Placement Agent Warrant contains the same terms as the Common Stock Warrants regarding the adjustment in the event of a stock split and the down-round provision. The fair value of the Placement Agent Warrant at issuance was approximately $0.31 million.

Upon the Reverse Stock Split, the adjustment provision for the Common Stock Warrants and Placement Agent Warrant was triggered. As a result, the total shares issuable on exercise of the Common Stock Warrants increased from 268,840 to 473,220, and the exercise price changed from $6.90 to $3.92. Similarly, the total shares issuable on exercise of Placement Agent Warrant increased from 18,553 to 32,666, and the exercise price changed from $6.90 to $3.92. The incremental consideration for the Placement Agent Warrant related to such adjustment was approximately $0.04 million. As a result of shares sold as part of the ATM Financing, the down-round provision on the Common Stock Warrants and the Placement Agent Warrant was triggered. As a result, the exercise price of such warrants was reduced to $3.36 and the total shares issuable on exercise of the Common Stock Warrants and the Placement Agent Warrant increased to 552,798 and 38,159, respectively. The incremental consideration for the Placement Agent Warrant related to such adjustment was approximately $0.02 million.

In conjunction with the AxoBio Disposition in March 2024, the Closing Share Consideration (as defined in Note 13), including 128,178 shares of Common Stock issued for the AxoBio Acquisition, was returned to the Company and cancelled.

Series A Voting Convertible Preferred Stock

Pursuant to the Company's certificate of incorporation, as amended, it is authorized to issue 20,000,000 shares of preferred stock. In connection with the AxoBio Acquisition, the Company issued 4,243 shares of Series A Preferred Stock (as defined in Note 13) to former stockholders of AxoBio as part of the Closing Share Consideration. In conjunction with the AxoBio Disposition in March 2024, such shares were returned to the Company and were cancelled.

2023 Long-Term Incentive Plan

In July 2023, the stockholders of the Company approved the 2023 Long-Term Incentive Plan (the “2023 Plan”), which replaced the Amended and Restated 2009 Stock Incentive Plan (the “2009 Plan”). No new awards are being made under the 2009 Plan. Under the 2023 Plan, the Board may grant awards of stock options, stock appreciation rights, restricted stock, restricted stock units or other stock-based awards to employees and other recipients as determined by the Board. The exercise price per share for an option granted to employees owning stock representing more than 10% of the Company at the time of the grant cannot be less than 110% of the fair market value. Incentive and non-qualified stock options granted to all persons shall be granted at a price no less than 100% of the fair market value and any price determined by the Board. Options expire no more than ten years after the date of the grant. Incentive stock options to employees owning more than 10% of the Company expire no more than five years after the date of grant. The vesting of stock options is determined by the Board. Generally, the options vest over a four-year period at a rate of 25% one year following the date of grant, with the remaining shares vesting equally on a monthly basis over the subsequent thirty-six months.

The maximum number of shares that may be issued under the 2023 Plan is the sum of: (i) 34,880, (ii) an annual increase on January 1, 2024 and each anniversary of such date prior to the termination of the 2023 Plan, equal to the lesser of (a) 4% of the outstanding shares of our Common Stock determined on a fully diluted basis as of the immediately preceding year-end and (b) such smaller number of shares as determined by the Board or the compensation committee of the Board, and (iii) the shares of Common Stock subject to 2009 Plan awards, to the extent those shares are added into the 2023 Plan by operation of the recycling provisions described below.

The initial maximum number of shares of Common Stock that may be issued under the 2023 Plan through incentive stock options was 34,880, provided that this limit automatically increases on January 1 of each year for a period of not more than ten years, commencing on January 1, 2024 and ending on (and including) January 1, 2032, by an amount equal to the lesser of 50,000 shares or the number of shares added to the share pool as of such January 1, as described in clause (ii) of the preceding sentence. The following shares will be added (or added back) to the shares available for issuance under the 2023 Plan:

•

Shares subject to 2009 Plan or 2023 Plan awards that expire, terminate or are canceled or forfeited for any reason after the effectiveness of the 2023 Plan;

•

Shares that after the effectiveness of the 2023 Plan are withheld to satisfy the exercise price of an option issued under the 2009 Plan or 2023 Plan;

•

Shares that after the effectiveness of the 2023 Plan are withheld to satisfy tax withholding obligations related to any award under the 2009 Plan or 2023 Plan; and

•

Shares that after the effectiveness of the 2023 Plan are subject to a stock appreciation right that are not delivered on exercise or settlement.

However, the total number of shares underlying 2009 Plan awards that may be recycled into the 2023 Plan pursuant to the above-described rules will not exceed the number of shares underlying 2009 Plan awards as of the effective date of the 2023 Plan (as adjusted to reflect the Business Combination). Shares of Common Stock issued through the assumption or substitution of awards in connection with a future acquisition of another entity will not reduce the shares available for issuance under the 2023 Plan.

Warrant and Option Valuation

The Company computes the fair value of warrants and options granted using the Black-Scholes option pricing model. The expected term used for warrants and options issued to non-employees is the contractual life, and the expected term used for options issued to employees and directors is the estimated period that options granted are expected to be outstanding. The Company utilizes the “simplified” method to develop an estimate of the expected term of “plain vanilla” grants for stock options. The Company utilizes an expected volatility figure based on a review of the historical volatilities over a period equivalent to the expected life of the instrument valued by similarly positioned public companies within its industry. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued.

Warrants Outstanding

A summary of warrant activity during the six months ended June 30, 2025 is as follows:


	Number of Shares Issuable on Exercise		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life in Years		Aggregate Intrinsic Value
Outstanding, December 31, 2024		154,744	$	303.30		3.62	$	36,242
Issued		590,957		3.36		0.00		—
Outstanding, June 30, 2025		745,701	$	65.60		4.22	$	—
Exercisable, June 30, 2025		707,542	$	68.95		4.21	$	—

Option Activity and Summary

A summary of option activity during the six months ended June 30, 2025 is as follows:


	Number of Shares Issuable on Exercise			Weighted Average Exercise Price		Weighted Average Remaining Life in Years		Aggregate Intrinsic Value
Outstanding, December 31, 2024		147,110		$	36.07		9.36	$	7,100
Expired/Cancelled		(42,919	)		26.66		—		—
Outstanding, June 30, 2025		104,191		$	39.94		8.75	$	—
Vested/Exercisable, June 30, 2025		21,193		$	79.51		7.63	$	—

The Company recorded stock-based compensation expense related to its options of $194,323 and $163,700 for the three months ended June 30, 2025 and 2024, respectively, and $309,152 and $375,169 for the six months ended June 30, 2025 and 2024, respectively. As of June 30, 2025, there was $1,563,753 of unrecognized compensation expense related to unvested stock options, which will be recognized over the weighted average remaining vesting period of 2.6 years.

- Definition

The entire disclosure for equity.

+ References

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+ Details

Longevity Health Holdings, Inc. 10-Q