Company: BIAF
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010787
Chunk: 3

Company: bioAffinity Technologies, Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 7
Chunk 3
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 in high-potential national markets. Specifically,
cost savings are a result of labor cost reductions, operational efficiency enhancements, and discontinuing certain unprofitable
pathology services to focus on high-margin services such as CyPath® Lung.

On February 26, 2025, we entered
into a warrant inducement agreement with certain holders of existing warrants, such holders exercised for cash a total of 2,438,473
warrants originally issued in August 2024 and October 2024, at the reduced exercise price of $0.58 per share, for aggregate
gross proceeds of approximately $1.4 million, before deducting advisory fees and other expenses payable by it. In consideration of
the immediate exercise of the October Warrants and August Warrants, the Company issued unregistered common warrants to purchase an
aggregate of up to 2,926,166 shares of Common Stock (120% of the number of shares of Common Stock issuable upon exercise of the
warrants) at an exercise price of $0.85 per share, which warrants are not exercisable until our stockholders approve such
exercise.

Financial

To date, we have devoted a substantial portion of
our efforts and financial resources to the development of our diagnostic test, CyPath® Lung. As a result, since our inception
in 2014, we have funded our operations principally through private and public sales of our equity (“IPO”). As of March 31,
2025, we had cash and cash equivalents of $0.4 million. As of May 13, 2025, after the 2025 equity financing, we had cash and cash equivalents
of $2.3 million, which we expect will not support our operations through August 2025. We have incurred significant losses and negative
cash flows from operations since inception and expect to continue to incur losses and negative cash flows for the foreseeable future.
Based on the Company’s current expected level of operating expenditures and the cash and cash equivalents on hand at March 31, 2025,
management concludes that there is substantial doubt about the Company’s ability to continue as a going concern for a period of
at least twelve (12) months subsequent to the issuance of the accompanying condensed consolidated financial statements.

Prior to acquisition of the clinical pathology laboratory
by PPLS, Village Oaks, under the trade name Precision Pathology Services, had licensed and developed CyPath® Lung as a
laboratory developed test (“LDT”) for sale to