# EDGAR Filing Document

**Accession Number:** 0001385818
**File Stem:** 0001437749-25-019189
**Filing Date:** 2025-6
**Character Count:** 614177
**Document Hash:** f2fac1d9783bbc98a1220f7cba1b0a2e
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001437749-25-019189.hdr.sgml**: 20250602

**ACCESSION NUMBER**: 0001437749-25-019189

**CONFORMED SUBMISSION TYPE**: S-1

**PUBLIC DOCUMENT COUNT**: 117

**FILED AS OF DATE**: 20250602

**DATE AS OF CHANGE**: 20250602

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** AYTU BIOPHARMA, INC
- **CENTRAL INDEX KEY:** 0001385818
- **STANDARD INDUSTRIAL CLASSIFICATION:** PHARMACEUTICAL PREPARATIONS [2834]
- **ORGANIZATION NAME:** 03 Life Sciences
- **EIN:** 470883144
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 0630

**FILING VALUES:**
- **FORM TYPE:** S-1
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-287728
- **FILM NUMBER:** 251016117

**BUSINESS ADDRESS:**
- **STREET 1:** 7900 E. UNION AVENUE
- **STREET 2:** SUITE 920
- **CITY:** DENVER
- **STATE:** CO
- **ZIP:** 80237
- **BUSINESS PHONE:** (720) 437-6580

**MAIL ADDRESS:**
- **STREET 1:** 7900 E. UNION AVENUE
- **STREET 2:** SUITE 920
- **CITY:** DENVER
- **STATE:** CO
- **ZIP:** 80237

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** AYTU BIOSCIENCE, INC
- **DATE OF NAME CHANGE:** 20150609

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** AYTU BIOSCIENCE, INC.
- **DATE OF NAME CHANGE:** 20150609

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Rosewind CORP
- **DATE OF NAME CHANGE:** 20070110

?xml version='1.0' encoding='ASCII'? aytu20250530_s1.htm

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**As filed with the U.S. Securities and Exchange Commission on June 2, 2025**

**Registration No. 333-** 

**UNITED STATES**

 **SECURITIES AND EXCHANGE COMMISSION**

 **Washington, D.C. 20549**

**FORM S-1**

 **REGISTRATION STATEMENT**

 **UNDER THE**

 **SECURITIES ACT OF 1933**

![aytulogo.jpg](aytulogo.jpg)

**AYTU BIOPHARMA, INC.**

(Exact name of registrant as specified in its charter)

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| | | |
|:---|:---|:---|
| **Delaware**<br> (State or other jurisdiction of<br> incorporation or organization) | **2834**<br> (Primary Standard Industrial<br> Classification Code Number) | **47-0883144**<br> (I.R.S. Employer<br> Identification Number) |

---

**7900 East Union Avenue, Suite 920**

 **Denver, Colorado 80237**

 **(720) 437-6580**

(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

**Joshua R. Disbrow**

 **Chief Executive Officer**

**Aytu BioPharma, Inc.**

 **7900 East Union Avenue, Suite 920**

 **Denver, Colorado 80237**

 **Telephone: (720) 437-6580**

(Name, address, including zip code, and telephone number, including area code, of agent for service)

***Copies to:***

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| | |
|:---|:---|
| **Anthony W. Epps**<br> **Joshua B. Erekson**<br> **Dorsey & Whitney LLP**<br> **1400 Wewatta Street, Suite 400**<br> **Denver, Colorado 80202**<br> **(303) 352-1109** | **David Danovitch**<br> **Aaron Schleicher**<br> **Sullivan & Worcester LLP**<br> **1251 Avenue of the Americas**<br> **New York, New York 10019**<br> **(212) 660-3060** |

---

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**Approximate date of commencement of proposed sale to the public**: As soon as practicable after the effective date of this registration statement.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

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| | | | |
|:---|:---|:---|:---|
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| Non-accelerated filer | ☒ | Smaller reporting company | ☒ |
|  |  | Emerging growth company | ☐ |

---

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

**The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission acting pursuant to said Section 8(a), may determine.**

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**The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the United States Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.**

**SUBJECT TO COMPLETION DATED JUNE 2,** **2025**

**PRELIMINARY PROSPECTUS**

![aytulogolarge.jpg](aytulogolarge.jpg)

**AYTU BIOPHARMA, INC.**

 **6,741,573 shares of Common Stock**

**or** 

**Up to 6,741,573 Prefunded Warrants to Purchase 6,741,573 Shares of Common Stock and up to 6,741,573 Shares of Common Stock Underlying the Prefunded Warrants**

We are offering, on a firm commitment basis,6,741,573 shares of common stock, par value $0.0001 per share ("Common Stock") at an assumed public offering price of $1.78 per share, based on the closing price of our Common Stock on the Nasdaq Capital Market LLC (the "Nasdaq") on May 30, 2025.

We are also offering to each purchaser of shares of Common Stock that would otherwise result in the purchaser's beneficial ownership exceeding 4.99% of our outstanding shares of Common Stock immediately following the consummation of this offering the opportunity to purchase prefunded warrants (the "Prefunded Warrants") in lieu of Common Stock. A holder of Prefunded Warrants will not have the right to exercise any portion of its Prefunded Warrants if the holder, together with its affiliates, would beneficially own in excess of 4.99% (or, at the election of the holder, such limit may be increased to up to 19.99%) (such percentage, the "Beneficial Ownership Cap") of the number of shares of Common Stock outstanding immediately after giving effect to such exercise. Each Prefunded Warrant will be exercisable for one share of Common Stock. The public offering price of each Prefunded Warrant will be equal to the public offering price per share of Common Stock, minus $0.0001, and the remaining exercise price of each Prefunded Warrant will equal $0.0001 per share. The Prefunded Warrants will be immediately exercisable (subject to the Beneficial Ownership Cap) and may be exercised at any time until all of the Prefunded Warrants are exercised in full. For each Prefunded Warrant we sell in this offering, the number of shares of Common Stock we are offering will be decreased on a one-for-one basis. See "*Description of Securities Included in this Offering*" in this prospectus for more information. We are also registering the shares of Common Stock issuable from time to time upon the exercise of the Prefunded Warrants offered hereby (the "Warrant Shares").

There is no established public trading market for the Prefunded Warrants, and we do not expect a market for the Prefunded Warrants to develop. We do not intend to list the Prefunded Warrants on the Nasdaq, any other national securities exchange or any other trading system.

Certain of our existing stockholders, officers, and directors plan to participate in this offering on the same terms as other investors.

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We have granted the underwriters an option to purchase up to an additional 1,011,235 shares of Common Stock from us (equal to 15% of the shares of Common Stock issued in this offering) at the assumed public offering price, less underwriting discounts and commissions. The underwriters may exercise this option at any time and from time to time during the 30-day period from the date of this prospectus.

Our shares of Common Stock are listed on the Nasdaq under the symbol "AYTU." On May 30, 2025, the closing price of our Common Stock was $1.78 per share.

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| | | | |
|:---|:---|:---|:---|
|  | **Per Share** | **Per Prefunded**<br> **Warrant** | **Total** |
| Public offering price<sup>(1)</sup> | $| $| $|
| Underwriter fees <sup>(2)</sup> | $| $| $|
| Proceeds, before expenses, to us | $| $| $|

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<sup>(1)</sup> The assumed public offering price is $1.78 per share of Common Stock and $1.7799 per Prefunded Warrant.

<sup>(2)</sup> In connection with this offering, we have agreed to pay to the underwriters a cash fee equal to seven percent (7.0%) of the gross proceeds received by us in the offering. See "Underwriting" for additional information regarding total compensation to the underwriters.

**Investing in our securities involves a high degree of risk. See the section entitled** "**Risk Factors**" **beginning on page 8 of the prospectus. You should carefully consider these risk factors, as well as the information contained in this prospectus, before you invest.**

**Neither the United States Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.**

*Sole book-runner*

 **Lake Street**

The date of this prospectus is , 2025

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**EXPLANATORY NOTE**

On July 31, 2024, we successfully completed the previously announced wind down and divestiture of our Consumer Health business. We determined that the accounting requirements for reporting the Consumer Health business as a discontinued operation were met when the wind down and divestiture was completed on July 31, 2024, and that we now operate as one single operating and reportable segment. Due to such determination we have included in this registration statement recast consolidated financial statements and the notes thereto for the years ended June 30, 2024, and 2023, included elsewhere in this registration statement and an updated Management's Discussion and Analysis of Financial Condition and Result of Operations for the years ended June 30, 2024, and 2023, to reflect the Consumer Health business as a discontinued operation and the Company as one single operating and reportable segment.

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**TABLE OF CONTENTS**

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| | |
|:---|:---|
| [ABOUT THIS PROSPECTUS](#about) | [1](#about) |
| [TRADEMARKS](#trade) | [1](#trade) |
| [CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS AND RISK FACTOR SUMMARY](#caution) | [2](#caution) |
| [PROSPECTUS SUMMARY](#prossumm) | [4](#prossumm) |
| [RISK FACTORS](#risk) | [9](#risk) |
| [USE OF PROCEEDS](#use) | [11](#use) |
| [CAPITALIZATION](#capital) | [12](#capital) |
| [DILUTION](#dilution) | [12](#dilution) |
| [MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](#mda) | [14](#mda) |
| [DESCRIPTION OF SECURITIES](#securities) | [25](#securities) |
| [UNDERWRITING](#underwriting) | [28](#underwriting) |
| [CERTAIN MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS FOR NON-U.S. HOLDERS](#certain) | [36](#certain) |
| [LEGAL MATTERS](#legal) | [41](#legal) |
| [EXPERTS](#experts) | [41](#experts) |
| [WHERE YOU CAN FIND MORE INFORMATION](#info) | [41](#info) |
| [INCORPORATION BY REFERENCE](#incorp) | [42](#incorp) |
| [INDEX TO CONSOLIDATED FINANCIAL STATEMENTS](#index) | [F-1](#index) |

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**ABOUT THIS PROSPECTUS**

This prospectus, including the information incorporated by reference, is part of a registration statement that we have filed with the United States Securities and Exchange Commission (the "SEC"). You should not assume that the information contained in this prospectus is accurate on any date subsequent to the date set forth on the front cover of this prospectus or that any information we have incorporated by reference is correct on any date subsequent to the date of the document incorporated by reference, even though this prospectus is delivered or securities are sold or otherwise disposed of on a later date. It is important for you to read and consider all information contained in this prospectus, including the Information Incorporated by Reference herein, in making your investment decision. You should also read and consider the information in the documents to which we have referred you under the captions "*Where You Can Find More Information*" and "*Incorporation of Certain Information by Reference*" in this prospectus.

Neither we nor the underwriters have authorized any dealer, salesman or other person to give any information or to make any representation other than those contained or incorporated by reference in this prospectus. You must not rely upon any information or representation not contained or incorporated by reference in this prospectus. This prospectus does not constitute an offer to sell or the solicitation of an offer to buy any of our securities other than the securities covered hereby, nor does this prospectus constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such jurisdiction. Persons who come into possession of this prospectus in jurisdictions outside the United States are required to inform themselves about, and to observe, any restrictions as to the offering and the distribution of this prospectus applicable to those jurisdictions.

We further note that the representations, warranties and covenants made in any agreement that is filed as an exhibit to any document that is incorporated by reference in the accompanying prospectus were made solely for the benefit of the parties to such agreement, including, in some cases, for the purpose of allocating risk among the parties to such agreements, and should not be deemed to be a representation, warranty or covenant to you. Moreover, such representations, warranties or covenants were accurate only as of the date when made. Accordingly, such representations, warranties and covenants should not be relied on as accurately representing the current state of our affairs.

The information in this prospectus is accurate as of the date on the front cover. Information incorporated by reference into this prospectus is accurate as of the date of the document from which the information is incorporated. You should not assume that the information contained in this prospectus is accurate as of any other date.

As used in this prospectus and in any prospectus supplement, unless the context otherwise requires, the terms "Aytu," the "Company," "we," "us," and "our" refer to Aytu BioPharma, Inc. and, unless the context requires otherwise, the subsidiaries through which it conducts business.

**TRADEMARKS**

This Registration Statement on Form S-1 refers to trademarks, such as Aytu, Aytu BioPharma, Aytu RxConnect, Neos Therapeutics, Adzenys, Adzenys ER, Adzenys XR-ODT, Cotempla, Cotempla XR-ODT, Karbinal, Poly-Vi-Flor and Tri-Vi-Flor, which are protected under applicable intellectual property laws and are our property or the property of our subsidiaries. This Form S-1 also contains trademarks, service marks, copyrights and trade names of other companies which are the property of their respective owners. Solely for convenience, our trademarks and tradenames referred to in this Form S-1 may appear without the® or™ symbols, but such references are not intended to indicate in any way that we will not assert, to the fullest extent under applicable law, our rights to these trademarks and tradenames.

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**CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS**

 **AND RISK FACTOR SUMMARY**

This prospectus contains statements that the Company believes are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), Section 21E of the Exchange Act of 1934, as amended (the "Exchange Act"), and the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements relating to expectations for future financial performance, business strategies or expectations for our business. These statements are based on the beliefs and assumptions of the management of the Company. Although the Company believes that its plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, it cannot provide assurance that it will achieve or realize these plans, intentions or expectations. These statements constitute projections, forecasts and forward-looking statements, and are not guarantees of performance. Such statements can be identified by the fact that they do not relate strictly to historical or current facts. When used in this in this prospectus, words such as "anticipate," "believe," "can," "continue," "could," "estimate," "expect," "forecast," "intend," "may," "might," "plan," "possible," "potential," "predict," "project," "seek," "should," "strive," "target," "will," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.

You should not place undue reliance on these forward-looking statements. Should one or more of a number of known and unknown risks and uncertainties materialize, or should any of our assumptions prove incorrect, the Company's actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include, but are not limited to the risks below, which also serves as a summary of the principal risks of an investment in our securities:

● We have incurred losses to date and can give no assurance of profitability.

● We have not established sources of ongoing revenue sufficient to cover operating costs.

● We may need to raise additional funding, which may not be available on acceptable terms, or at all.

● We may not have cash available to us in an amount sufficient to enable us to make interest or principal payments on our indebtedness when due.

● The terms of our loan agreement place restrictions on our operating and financial flexibility. If we raise additional capital through debt financing, the terms of any new debt could further restrict our operating and financial flexibility.

● We are currently engaged in discussions with various parties regarding potential strategic transactions and there can be no assurance that these discussions will result in the pursuit or consummation of any potential transaction.

● We have indefinitely suspended development of our AR101 (enzastaurin) clinical development program and shifted our strategic focus towards accelerating the growth of our commercial business. If we fail to execute successfully on this reprioritized strategic focus, our business, results of operations and financial condition could be materially and adversely affected.

● We have been and, in the future, may become a defendant in one or more stockholder derivative, class-action, and other litigation, and any such lawsuits may adversely affect our business, financial condition, results of operations and cash flows.

● We have broad discretion in the use of the net proceeds from this offering and may not use them effectively.

● You will experience immediate and substantial dilution in the net tangible book value per share of the Common Stock you purchase. You may also experience future dilution as a result of future equity offerings.

● Resales of our Common Stock in the public market during this offering by our stockholders may cause the market price of our Common Stock to fall.

● This offering may cause the trading price of our Common Stock to decrease.

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● Holders of Prefunded Warrants will have no rights as a common stockholder until such holders exercise their Prefunded Warrants and acquire our Common Stock.

● Absence of a public trading market for the Prefunded Warrants may limit your ability to resell the Prefunded Warrants.

● The Prefunded Warrants contain features that may reduce your economic benefit from owning them.

● Since the Prefunded Warrants are executory contracts, they may have no value in a bankruptcy or reorganization proceeding.

● Proposed legislation in the U.S. Congress, including changes in U.S. tax law, may adversely impact us and the value of the shares of Common Stock and the Warrant Shares.

● The exclusive jurisdiction, waiver of trial by jury, and choice of law clauses set forth in the Prefunded Warrants to be issued to purchasers in this offering may have the effect of limiting a purchaser's rights to bring legal action against us and could limit a purchaser's ability to obtain a favorable judicial forum for disputes with us.

● We recently announced that we have been engaged in discussions with various parties regarding potential strategic transactions and potential financing options. There can be no assurance that this process will result in the pursuit or consummation of any potential transaction, or that any such potential transaction, if implemented, will provide sufficient funding to continue our operations.

● Our efforts to expand and transform our businesses may require significant investments; if our strategies are unsuccessful, our business, results of operations and/or financial condition may be materially adversely affected.

● We may have difficulties integrating acquired businesses and as a result, our business, results of operations and/or financial condition may be materially adversely affected.

● In fiscal 2024, the great majority of our gross revenue and gross accounts receivable were due to three significant customers, the loss of which could materially and adversely affect our results of operations.

● Our accounts receivable subjects us to credit risk.

● Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to the Company.

● Public concern over the abuse of medications that are controlled substances, including increased legislative, legal and regulatory action, could negatively affect our business.

● Certain of our stockholders own a significant percentage of our stock and their interests may conflict with yours.

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**PROSPECTUS SUMMARY**

*This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all of the information that you should consider before investing in our securities. You should carefully read this entire prospectus, and our other filings with the SEC, including the following sections, which are either included herein and/or incorporated by reference herein,* "*Risk Factors,*" "*Special Note Regarding Forward-Looking Statements,*" "*Management*'*s Discussion and Analysis of Financial Condition and Results of Operations*" *and the consolidated financial statements included and incorporated by reference herein, before making a decision about whether to invest in our securities.*

**Company Overview**

We are a pharmaceutical company focused on commercializing novel therapeutics. Our strategy is to become a leading pharmaceutical company that improves the lives of patients. We use a focused approach of in-licensing, acquiring, developing and commercializing novel prescription therapeutics in order to continue building our portfolio of revenue-generating products and leveraging our commercial team's expertise to build leading brands within large therapeutic markets. Our primary focus is on commercializing innovative prescription products that address prevalent conditions, including attention deficit hyperactivity disorder ("ADHD"). We are focusing our efforts on accelerating the growth of our commercial business and achieving positive operating cash flows. To achieve these goals, we indefinitely suspended active development of our clinical development programs and have wound down and divested unprofitable operations. In conjunction with growing our prescription business we continue to pursue business development to identify novel products that complement our portfolio of prescription brands. To that end, we have agreed to terms to exclusively commercialize a novel antidepressant that has been recently approved by the United States Food and Drug Administration ("FDA"). We believe that this product represents a significant opportunity for the Company as a novel treatment for major depressive disorder ("MDD"), a condition affecting over 21 million Americans.

In the first quarter of fiscal 2025 we completed the previously announced wind down and divestiture of our consumer health business (the "Consumer Health business") and now operate our business as a single operating and reporting segment. The accounting requirements for reporting the Consumer Health business as discontinued operation were met when the wind down and divestiture was completed on July 31, 2024. Accordingly, our consolidated financial statements for all periods presented reflect the Consumer Health business as a discontinued operation. Our business from continuing operations is focused on our prescription pharmaceutical products sold primarily through third party wholesalers and pharmacies and which primarily consists of two product portfolios. The first consists of two products for the treatment of ADHD: Adzenys XR-ODT (amphetamine) extended-release orally disintegrating tablets ("Adzenys") and Cotempla XR-ODT (methylphenidate) extended-release orally disintegrating tablets ("Cotempla" and Adzenys together with Cotempla the "ADHD Portfolio"). The second consists primarily of Karbinal® ER (carbinoxamine maleate extended-release oral suspension) ("Karbinal"), an extended-release first-generation antihistamine suspension containing carbinoxamine indicated to treat numerous allergic conditions, and Poly-Vi-Flor and Tri-Vi-Flor, two complementary prescription fluoride-based supplement product lines containing combinations of fluoride and vitamins in various formulations for infants and children with fluoride deficiency (the "Pediatric Portfolio"). During the fourth quarter of fiscal 2024, we successfully completed the transition of all manufacturing of our ADHD products to a United States-based third-party contract manufacturer to improve the profitability of these products.

In July 2023, we entered into an exclusive collaboration, distribution and supply agreement with Medomie Pharma Ltd ("Medomie"), a privately owned pharmaceutical company, for Medomie to commercialize Adzenys and Cotempla in Israel and the Palestinian Authority. In September 2024, we entered into an exclusive collaboration, distribution and supply agreement with Lupin Pharma Canada Ltd ("Lupin"), a subsidiary of global pharmaceutical company Lupin Limited, for Lupin to commercialize Adzenys and Cotempla in Canada. We will supply Adzenys and Cotempla to Medomie and Lupin based on forecasts and provide various product commercialization resources. Medomie and Lupin are responsible for seeking local regulatory approvals and marketing authorizations for both Adzenys and Cotempla, which is expected to occur over the next 24 months. The agreements with Medomie and Lupin represent our first and second international commercial agreements for Adzenys and Cotempla, respectively.

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In light of our own business activities and external developments in the biopharmaceutical industry, we regularly review our performance, prospects and risks such as the potential impact to our business resulting from our competitive landscape (i.e., entry of generic competitors, incremental payer pressures, new branded entrants, market events, etc.). These reviews have included consideration of potential partnerships, collaborations, and other strategic transactions such as licensing, acquisitions or divestitures of products, programs or technology to enhance stockholder value. We continue to evaluate potential strategic transactions (inclusive of seeking product licenses and/or acquisitions and potential business combinations), but there can be no guarantee that we will be able to enter into such transactions, and there can be no guarantee that such transactions will achieve our desired goals.

**Recent Developments**

***Major Depressive Disorder Exclusive Commercialization Agreement***

Shortly after effectiveness of this registration statement, we anticipate entering into an Exclusive Commercialization Agreement (the "Agreement") with Fabre-Kramer Holdings, Inc. ("Fabre-Kramer"), pursuant to which we will acquire certain rights and obligations in connection with the commercialization of EXXUA™ (gepirone hydrochloride) extended release tablets, an FDA-approved pharmaceutical indicated for the treatment of Major Depressive Disorder (MDD) in adults, in any formulation and any dosage strength for all current and future indications (the "Product") at any time before or during the term of the Agreement in the United States of America, its commonwealths, territories, and possessions (the "Territory"). EXXUA is a first-in-class, FDA-approved treatment for MDD with a novel mechanism of action and differentiated clinical profile, and, upon the execution of the Agreement, we intend to launch EXXUA by the end of the second fiscal quarter of 2026 through our commercial team. EXXUA has been extensively studied in over 5,000 patients and represents a new class of therapeutics to compete in the $22 billion United States prescription MDD market. It can become a very important treatment option for the over 21 million Americans affected by MDD. Over 340 million antidepressant prescriptions were written in 2024 in the United States, yet significant unmet needs remain considering the unacceptable side effects associated with current therapeutics.

As consideration for the Agreement, we will make an upfront cash payment of $3,000,000 to Fabre-Kramer on the effective date of the Agreement. Within forty-five (45) days of the one-year anniversary of the first physical sale of Product in the Territory through a bona fide, arm's length transaction to distribute the Product into the commercial channel for the purpose of fulfilling the Product prescription demand and subsequent dispensing, we will make a second $3,000,000 payment (the "Second Payment"). The Second Payment may be increased to $5,000,000 if first year Product net sales meet or exceed $35 million. Additionally, we will pay Fabre-Kramer certain milestone payments ranging from $5,000,000 to over $100,000,000 per year based on sales milestones after a certain level of net sales are achieved with a threshold of $100,000,000 in net sales and the Company will pay 10% of net sales exceeding $1 billion. We will also pay royalty fees throughout the term of the Agreement based on the Company's net sales of the Product as follows: (i) initially 28% of net sales and increasing to 39% if net sales exceed $300 million in any year during the Term until such net sales reach a reduced royalty trigger; and (ii) after reaching such royalty trigger, 24.5% and increasing to 35.5% if net sales exceed the royalty threshold. The Company will also pay a supply price of 3% of net sales less its cost of goods sold, increasing to 4% of net sales if annual net sales exceed $300 million. The Agreement also contains customary clauses for pharmaceutical commercialization agreements, including, among others, post-marketing trials and obligations, regulatory matters, and indemnification.

The Agreement will be able to be terminated at any time upon mutual agreement between us and Fabre-Kramer. Either party will be able to terminate the Agreement at any time upon written notice for a material default or breach if the material default or breach is not cured within (1) ninety (90) days after written notice or (2) in the case of a breach that cannot be cured within ninety (90) days, within a reasonable period not exceeding one hundred and twenty (120) days after written notice. Additionally, either party will be able to terminate the Agreement at any time upon writing notice if (1) either party withdraws the Product from the market in the Territory for safety reasons or (2)(i) the FDA materially restricts the indications for the Product, or (ii) federal or state pricing controls are imposed that would result in obvious or substantial loss of sales for the Product.

***General***

In addition, we are in discussions to potentially acquire a novel treatment for a psychiatric condition, but these discussions are in the early stages. Thus, the outcome of these discussions cannot be determined at this time. If agreed upon, we would expect to acquire an FDA-approved, branded treatment for a psychiatric condition through an asset purchase agreement and similarly commercialize it through our commercial infrastructure with largely existing resources and personnel.

We continue to experience inflationary pressures and could experience supply chain disruptions related to the sourcing of raw materials, energy, logistics and labor for a number of reasons, including ongoing geopolitical events. While we do not have sales or operations in Russia or Ukraine and we do not have significant sales or operations in the Middle East, it is possible that the conflicts or actions taken in response, could adversely affect some of our markets and suppliers, economic and financial markets, costs and availability of energy and materials, or cause further supply chain disruptions. Inflationary pressures and supply chain disruptions could be significant across the business throughout fiscal 2025 and into fiscal 2026. Understanding these risks, we have not experienced stock outages for our ADHD products since the launch of those products, and the pediatric product supply has remained adequate to satisfy demand for the preceding four years.

In October 2024, we received a Paragraph IV Certification Notice Letter ("Notice Letter") from Granules Pharmaceuticals, Inc. ("Granules"), stating that it intends to market a generic version of Adzenys before the expiration of all patents currently listed in the Orange Book. The Notice Letter states that Granules' New Drug Application ("NDA") for the generic version of Adzenys contains a Paragraph IV certification alleging that these patents are not valid, not enforceable, and/or will not be infringed by the commercial manufacture, use or sale of the generic version of Adzenys. We timely filed a patent infringement lawsuit on December 11, 2024, against Granules to trigger a stay precluding the FDA from approving Granules' NDA for a generic version of Adzenys for up to 30 months or entry of judgment holding the patents invalid, unenforceable, or not infringed, whichever occurs first. On January 7, 2025, Granules submitted an answer to the complaint. This litigation is ongoing, and a trial has been scheduled to begin on December 7, 2026. We plan to vigorously enforce our intellectual property rights related to Adzenys.

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**Smaller Reporting Company**

Additionally, we are a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of the shares of Common Stock held by non-affiliates exceeds $250 million as of the prior June 30, and (ii) our annual revenue exceeds $100 million during such completed fiscal year and the market value of the shares of Common Stock held by non-affiliates exceeds $700 million as of the prior June 30. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible.

**Corporate Information**

Our headquarters is located at 7900 East Union Avenue, Suite 920, Denver, Colorado, 80237 and our telephone number is (720) 437-6580. We maintain a website at https://www.aytubio.com. Information on the website is not incorporated by reference and is not a part of this prospectus.

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**Summary of the Offering**

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| | |
|:---|:---|
| **Common Stock to be Offered** | 6,741,573 shares of our Common Stock, at an assumed public offering price of $1.78 per share, based on the closing price of our Common Stock on the Nasdaq on May 30, 2025. |
| **Prefunded Warrants to be Offered** | We are offering Prefunded Warrants to those purchasers whose purchase of shares of our Common Stock in this offering would result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the election of the purchaser, a lesser percentage or greater percentage up to 19.99%) of our outstanding shares of Common Stock following the consummation of this offering in lieu of the shares of Common Stock that would result in such excess ownership. For each Prefunded Warrant we sell, the number of shares of Common Stock we sell in this offering will be decreased on a one-for-one basis. |
|  | Each Prefunded Warrant will be exercisable for one share of Common Stock. The public offering price of each Prefunded Warrant will be equal to the public offering price per share of Common Stock, minus $0.0001, and the remaining exercise price of each Prefunded Warrant will equal $0.0001 per share. |
| **Underwriters**' **Option** | We have granted a 30-day option to the underwriters to purchase up to 1,011,235 additional shares of Common Stock from us (equal to 15% of the shares of Common Stock issued in this offering) at the assumed public offering price of $1.78, less underwriting discounts and commissions. |
| **Common Stock Outstanding Prior to This Offering** | 6,170,162 shares of Common Stock |

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| | |
|:---|:---|
| **Common Stock Outstanding after This Offering** | 12,911,735 shares of Common Stock, not including the exercise of the underwriters' option and assuming no Prefunded Warrants are sold in this offering. |
| **Use of Proceeds** | We intend to use the net proceeds from this offering for general corporate purposes, which may include capital expenditures, working capital and general and administrative expenses, and potential acquisitions of or investments in businesses, products and technologies that complement our business. Pending these uses, we intend to invest the funds in short-term, investment grade, interest-bearing securities. Assuming we enter into the Agreement, we will use $3 million of the net proceeds for the initial upfront license fee payment pursuant to the Agreement. It is possible that, pending their use, we may invest the net proceeds in a way that does not yield a favorable, or any, return for us. See "*Use of Proceeds.*" Our management will have broad discretion in the application of the net proceeds, and investors will be relying on our judgment regarding the application of the net proceeds from this offering. See "*Risk Factors*" for a discussion of certain risks that may affect our intended use of the net proceeds from this offering. |
| **Market for Common Stock** | Our Common Stock is listed on Nasdaq under the symbol "*AYTU*." |
| **Risk Factors** | An investment in our securities is highly speculative and involves a significant degree of risk. See "*Risk Factors*" and other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in our securities. |

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The total number of shares of Common Stock outstanding after this offering is based on 6,170,162 shares of Common Stock outstanding as of March 31, 2025, but excludes the following as of such date:

● 219,244 shares of our Common Stock issuable upon the exercise of stock options outstanding, at a weighted average exercise price of $4.53 per share, of which stock options to purchase 93,425 shares of Common Stock were then exercisable, at a weighted average price of $8.05 per share;

● 84 shares of our Common Stock issuable upon the vesting of restricted stock units outstanding;

● 89,784 shares of our Common Stock reserved for future grants of stock options (or other similar equity instruments) under the Aytu BioPharma, Inc. 2023 Equity Incentive Plan; and

● 5,897,337 shares of our Common Stock issuable upon the exercise of warrants outstanding, at a weighted average exercise price of $3.10 per share.

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**RISK FACTORS**

*Investing in our securities involves a high degree of risk. Prior to making a decision about investing in our securities, you should carefully consider the specific risk factors discussed in the sections entitled* "*Risk Factors*" *contained in [<u>our annual report on Form 10-K for the fiscal year ended June 30, 2024</u>](http://www.sec.gov/ix?doc=/Archives/edgar/data/0001385818/000143774924030062/aytu20240630_10k.htm), under the heading* "*Item 1A. Risk Factors,*" *and as described or may be described in any subsequent quarterly reports on Form 10-Q under the heading* "*Item 1A. Risk Factors,*" *as well as in any applicable prospectus supplement and contained or to be contained in our filings with the SEC and incorporated by reference in this prospectus, together with all of the other information contained in this prospectus, or any applicable prospectus supplement. For a description of these reports and documents, and information about where you can find them, see* "*Where You Can Find More Information*" *and* "*Incorporation of Certain Documents by Reference.*" *If any of the risks or uncertainties described in our SEC filings or any prospectus supplement or any additional risks and uncertainties actually occur, our business, financial condition and results of operations could be materially and adversely affected. In that case, the trading price of our securities could decline and you might lose all or part of the value of your investment.*

**Risks Related to This Offering and Ownership of Our Securities**

***We have broad discretion in the use of the net proceeds from this offering and may not use them effectively.***

Our management will have broad discretion in the application of the net proceeds, including for any of the purposes described in the section of this prospectus entitled "*Use of Proceeds*." We currently intend to use the net proceeds from this offering for general corporate purposes, including capital expenditures, working capital and general and administrative expenses, and potential acquisitions of or investments in businesses, products and technologies that complement our business. We may also use a portion of any net proceeds for acquisitions of, or strategic investments in, complementary businesses, licenses, products, services, or technologies. You will be relying on the judgment of our management with regard to the use of these net proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the net proceeds are being used appropriately. The failure by our management to apply these funds effectively could result in financial losses that could have a material adverse effect on our business, cause the price of our securities to decline. Pending the application of these funds, we may invest the net proceeds from this offering in a manner that does not produce income or that loses value.

***You will experience immediate and substantial dilution in the net tangible book value per share of the Common Stock you purchase. You may also experience future dilution as a result of future equity offerings.***

If you purchase shares of Common Stock in this offering, you will incur immediate and substantial dilution in the amount of $2.02 per share of Common Stock, based on an assumed public offering price of $1.78 per share of Common Stock (the closing price of our Common Stock on May 30, 2025), because such assumed public offering price is substantially higher than the as adjusted net tangible book value per share of the Common Stock. See "Dilution" for additional information.

In addition, in order to raise additional capital, we may in the future offer additional shares of our Common Stock or other securities convertible into or exchangeable for our Common Stock at prices that may not be the same as the price per share in this offering. In the event that outstanding restricted stock units vest or outstanding warrants are settled, or that we make additional issuances of Common Stock or other convertible or exchangeable securities, you could experience additional dilution. We cannot assure you that we will be able to sell shares or other securities in any other offering at a price per share that is equal to or greater than the price per share paid by investors in this offering, and investors purchasing shares or other securities in the future could have rights superior to existing stockholders, including investors who purchase shares of Common Stock in this offering. The price per share at which we sell additional shares of our Common Stock or securities convertible into Common Stock in future transactions, may be higher or lower than the price per share in this offering. As a result, purchasers of the shares we sell, as well as our existing stockholders, will experience significant dilution if we sell at prices significantly below the price at which they invested.

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***We may not enter into the Exclusive Commercialization Agreement with Fabre-Kramer Holdings, Inc.***

Although we have entered into a non-binding term sheet with Fabre-Kramer, there is no guarantee that the Agreement will be executed. There is some possibility that we may not consummate the transaction with the Fabre-Kramer; however, we are very likely to do so. We believe that if executed, this product represents a significant opportunity for the Company as a novel treatment for MDD, a condition affecting over 21 million Americans. No assurances can be given that we will successfully identify and evaluate suitable business opportunities. We cannot guarantee that we will be able to negotiate the Agreement on favorable terms or that the Agreement will have the same terms as set forth in the non-binding term sheet.

***Resales of our Common Stock in the public market during this offering by our stockholders may cause the market price of our Common Stock to fall.***

Sales of a substantial number of shares of our Common Stock could occur at any time. The issuance of new shares of our Common Stock could result in resales of our Common Stock by our current stockholders concerned about the potential ownership dilution of their holdings. In turn, these resales could have the effect of depressing the market price for our Common Stock.

***This offering may cause the trading price of our Common Stock to decrease.***

The price per share, together with the number of shares of Common Stock we propose to issue and ultimately will issue if this offering is completed, may result in an immediate decrease in the market price of our Common Stock. This decrease may continue after the completion of this offering.

***Holders of Prefunded Warrants will have no rights as a common stockholder until such holders exercise their Prefunded Warrants and acquire our Common Stock.***

Until holders of Prefunded Warrants acquire shares of our Common Stock upon exercise of the Prefunded Warrants, holders of Prefunded Warrants will have no rights with respect to the shares of our Common Stock underlying such Prefunded Warrants. Upon exercise of the Prefunded Warrants, the holders thereof will be entitled to exercise the rights of a common stockholder only as to matters for which the record date occurs after the exercise date.

***Absence of a public trading market for the Prefunded Warrants may limit your ability to resell the Prefunded Warrants.***

There is no established trading market for the Prefunded Warrants to be issued pursuant to this offering, and they will not be listed for trading on Nasdaq or any other securities exchange or market, and the Prefunded Warrants may not be widely distributed. Purchasers of the Prefunded Warrants may be unable to resell the Prefunded Warrants or sell them only at an unfavorable price for an extended period of time, if at all.

***The Prefunded Warrants contain features that may reduce your economic benefit from owning them.***

For so long as you continue to hold Prefunded Warrants, you will not be permitted to enter into any short sale or similar transaction with respect to our Common Stock. This could prevent you from pursuing investment strategies that could provide you greater financial benefits from owning the Prefunded Warrant.

***Since the Prefunded Warrants are executory contracts, they may have no value in a bankruptcy or reorganization proceeding.***

In the event a bankruptcy or reorganization proceeding is commenced by or against us, a bankruptcy court may hold that any unexercised Prefunded Warrants are executory contracts that are subject to rejection by us with the approval of the bankruptcy court. As a result, holders of the Prefunded Warrants may, even if we have sufficient funds, not be entitled to receive any consideration for their Warrants or may receive an amount less than they would be entitled to if they had exercised their Prefunded Warrants prior to the commencement of any such bankruptcy or reorganization proceeding.

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***We have announced that we have been engaged in discussions with various parties regarding potential strategic transactions and potential financing options. There can be no assurance that this process will result in the pursuit or consummation of any potential transaction, or that any such potential transaction, if implemented, will provide sufficient funding to continue our operations.***

● significant fluctuations in our stock price could occur in response to developments relating to the process or market speculation regarding any such developments;

● we may encounter difficulties in hiring, retaining and motivating key personnel during this process or as a result of uncertainties generated by this process or any developments or actions relating to it;

● we may incur substantial increases in general and administrative expense associated with increased legal fees and the need to retain and compensate third-party advisors; and

● we may experience difficulties in preserving the commercially sensitive information that may need to be disclosed to third parties during this process or in connection with an assessment of our strategic options.

The review process also requires significant time and attention from management, which could distract them from other tasks in operating our business or otherwise disrupt our business. Such disruptions could cause concern to our suppliers, strategic partners or other constituencies and may have a material impact on our business and operating results and volatility in our share price.

There can be no assurance that this process will result in the pursuit or consummation of any potential transaction or strategy, or that any such potential transaction or strategy, if implemented, will provide sufficient funding to conduct our operations. Any outcome of this process would be dependent upon a number of factors that may be beyond our control, including, among other things, market conditions, industry trends, regulatory approvals, and the availability of financing on reasonable terms. The occurrence of any one or more of the above risks could have a material adverse impact on our business, financial condition, results of operations and cash flows.

***Proposed legislation in the U.S. Congress, including changes in U.S. tax law, may adversely impact us and the value of shares of our Common Stock, Prefunded Warrants and Warrant Shares.***

Changes to U.S. tax laws (which changes may have retroactive application) could adversely affect us or holders of our Common Stock, Prefunded Warrants and Warrant Shares. In recent years, many changes to U.S. federal income tax laws have been proposed and made, and additional changes to U.S. federal income tax laws are likely to continue to occur in the future.

The U.S. Congress is currently considering numerous items of legislation which may be enacted prospectively or with retroactive effect, which legislation could adversely impact our financial performance and the value of our Common Stock, Prefunded Warrants and Warrant Shares. Additionally, states in which we operate or own assets may impose new or increased taxes. If enacted, most of the proposals would be effective for the current or later years. The proposed legislation remains subject to change, and its impact on us and purchasers of our Common Stock, Prefunded Warrants and Warrant Shares is uncertain.

**USE OF PROCEEDS**

We estimate that the net proceeds that we will receive in the offering will be approximately $10.7 million, or approximately $12.3 million if the underwriters exercise their option to purchase additional shares in full, in each case after the underwriting commissions and estimated offering expenses payable by us.

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We intend to use the net proceeds from this offering for general corporate purposes, including capital expenditures, working capital and general and administrative expenses, and potential acquisitions of or investments in businesses, products and technologies that complement our business. We may also use a portion of any net proceeds to support our overall growth trajectory, including for acquisitions of, or strategic investments in, complementary businesses, products, services, or technologies, although we do not currently have any agreements or commitments to enter into any material acquisitions or investments. Assuming we enter into the Agreement, we will use $3 million of the net proceeds for the initial upfront license fee payment pursuant to the Agreement. We cannot specify with certainty all of the particular uses for the net proceeds to us from this offering.

The foregoing represents our current intentions with respect to the use and allocation of the net proceeds of the offering based on our present plans and business condition. The amounts and timing of any expenditure may vary depending on the amount of cash generated by our operations, competitive developments, our rate of growth and inorganic growth opportunities, if any, of our business. Therefore, as of the date of this prospectus, we cannot estimate the exact amounts or timing in respect of any of the purposes for the use of proceeds listed above.

**CAPITALIZATION**

The following table sets forth our cash and capitalization as of March 31, 2025, on:

● an actual basis; and

● an as-adjusted basis to reflect our receipt of the net proceeds from our sale of Common Stock in this offering at an assumed public offering price of $1.78 per share, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us, and assuming all shares of Common Stock offered hereunder are sold and no sale of any Prefunded Warrants,.

The as-adjusted information below is illustrative only, and our capitalization following the closing of this offering will be adjusted based on the actual terms of this offering determined at the time of pricing as well as our actual expenses. You should read this table together with "*Management's Discussion and Analysis of Financial Condition and Results of Operations*" and our consolidated financial statements and notes thereto appearing elsewhere in this prospectus.

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|:---|:---|:---|
|  | **March 31, 2025** | **March 31, 2025** |
|  | **Actual <sup>(1)</sup>** | **As** <br> **Adjusted** |
|  | **(in thousands, except share data)** | **(in thousands, except share data)** |
| Cash and cash equivalents | $18173 | $28829 |
| Stockholders' equity: |  |  |
| Common stock: par value $0.0001, 200,000,000 shares authorized; 6,170,162 shares issued and outstanding, actual; 12,911,735 shares issued and outstanding, as adjusted | $1 | $2 |
| Additional paid-in capital | 348614 | 359269 |
| Accumulated deficit | (313717) | (313717) |
| Total stockholders' equity | $34898 | $45554 |

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<sup>(1)</sup> Data is derived from our unaudited consolidated financial statements for the quarter ended March 31, 2025.

**DILUTION**

If you invest in the securities being offered by this prospectus, your interest will be diluted immediately to the extent of the difference between the public offering price per share of Common Stock and as adjusted net tangible book value per share of Common Stock after this offering.

Our historical net tangible book value as of March 31, 2025, was negative $13.8 million or negative $2.24 per share of our Common Stock. Historical net tangible book value per share represents the amount of our total tangible assets, less total liabilities, divided by the number of shares of our Common Stock outstanding as of March 31, 2025.

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After giving effect to the sale of 6,741,573 shares of Common Stock at the price of $1.78 per share of Common Stock, the closing sale price of our Common Stock on Nasdaq on May 30, 2025, and assuming no sale of any Prefunded Warrants, after deducting the underwriters discount and commissions and estimated offering expenses payable by us, our as adjusted net tangible book value as of March 31, 2025, would have been approximately negative $3.2 million or approximately negative $0.24 per share. This represents an immediate increase in net tangible book value of approximately $2.00 per share to our existing stockholders and an immediate dilution of approximately $2.02 per share to purchasers of our securities in this offering, as illustrated by the following table:

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| | | |
|:---|:---|:---|
| Assumed public offering price per share of Common Stock |  | $1.78 |
| Net tangible book value per share as of March 31, 2025, before giving effect to this offering | $(2.24) |  |
| Increase in net tangible per share attributable to investors in this offering | $2.00 |  |
| As adjusted net tangible book value per share, after giving effect to this offering |  | $(0.24) |
| Dilution per share to new investors in this offering |  | $2.02 |

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A $0.10 increase in the assumed public offering price of $1.78 per share of Common Stock (the closing sale price of our Common Stock on Nasdaq on May 30, 2025, and assuming no sale of any Prefunded Warrants), would increase our as adjusted net tangible book value after giving effect to this offering by approximately $0.6 million and the dilution per share to new investors in this offering by $0.04 per share, after deducting underwriter discounts and commissions and estimated offering expenses payable by us, and assuming the sale of 6,741,573 shares of Common Stock set forth on the cover page of this prospectus remains the same and no sale of any Prefunded Warrants in this offering.

The total number of shares of our Common Stock outstanding reflected in the discussion and tables above is based on 6,170,162 shares of our Common Stock outstanding as of March 31, 2025, but excludes the following as of such date:

● 219,244 shares of our Common Stock issuable upon the exercise of stock options outstanding, at a weighted average exercise price of $4.53 per share, of which stock options to purchase 93,425 shares of Common Stock were then exercisable, at a weighted average price of $8.05 per share;

● 84 shares of our Common Stock issuable upon the vesting of restricted stock units outstanding;

● 89,784 shares of our Common Stock reserved for future grants of stock options (or other similar equity instruments) under the Aytu BioPharma, Inc. 2023 Equity Incentive Plan; and

● 5,897,337 shares of our Common Stock issuable upon the exercise of warrants outstanding, at a weighted average exercise price of $3.10 per share.

To the extent that our outstanding options or warrants are exercised, you could experience further dilution. To the extent that we raise additional capital through the sale of additional equity, the issuance of any of our shares of Common Stock could result in further dilution to our stockholders.

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**MANAGEMENT**'**S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS** 

*You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this prospectus. In addition to historical information, this discussion contains forward-looking statements that involve risks, uncertainties and assumptions that could cause actual results to differ materially from management's expectations. Factors that could cause such differences are discussed in the sections entitled "Cautionary Statement Regarding Forward-Looking Statements and Risk Factor Summary" and "Risk Factors." We are not undertaking any obligation to update any forward-looking statements or other statements we may make in the following discussion or elsewhere in this document even though these statements may be affected by events or circumstances occurring after the forward-looking statements or other statements were made. Therefore, no reader of this document should rely on these statements being current as of any time other than the time at which this document is declared effective by the SEC.*

**Objective**

The purpose of the Management Discussion and Analysis (the "MD&A") is to present information that management believes is relevant to an assessment and understanding of our results of operations and cash flows for the year ended June 30, 2024, and our financial condition as of June 30, 2024. The MD&A is provided as a supplement to, and should be read in conjunction with, our consolidated financial statements and notes thereto included elsewhere in this prospectus.

**Overview**

We are a pharmaceutical company focused on commercializing novel therapeutics. Our strategy is to become a leading pharmaceutical company that improves the lives of patients. We use a focused approach of in-licensing, acquiring, developing and commercializing novel prescription therapeutics in order to continue building our portfolio of revenue-generating products and leveraging our commercial team's expertise to build leading brands within large therapeutic markets. Our primary focus is on commercializing innovative prescription products that address conditions frequently developed or diagnosed in children, including ADHD. We are focusing our efforts on accelerating the growth of our commercial business and achieving positive operating cash flows. To achieve these goals, we indefinitely suspended active development of our clinical development programs and have wound down and divested unprofitable operations. In conjunction with growing our prescription business we continue to pursue business development to identify novel products that complement our portfolio of prescription brands. To that end, we have agreed to terms to exclusively commercialize a novel antidepressant that has been recently approved by the FDA. We believe that this product represents a significant opportunity for the Company as a novel treatment for MDD, a condition affecting over 21 million Americans.

In the first quarter of fiscal 2025 we completed the previously announced wind down and divestiture of our Consumer Health business, and now operate our business as a single operating and reporting segment. The accounting requirements for reporting the Consumer Health business as discontinued operation were met when the wind down and divestiture was completed on July 31, 2024. Accordingly, our consolidated financial statements for all periods presented reflect the Consumer Health business as a discontinued operation. Our business from continuing operations is focused on our prescription pharmaceutical products sold primarily through third party wholesalers and pharmacies and which primarily consists of two product portfolios. The first, the ADHD Portfolio, consists of two products for the treatment of ADHD: Adzenys and Cotempla. The second, the Pediatric Portfolio, consists primarily of Karbinal, an extended-release first-generation antihistamine suspension containing carbinoxamine indicated to treat numerous allergic conditions, and Poly-Vi-Flor and Tri-Vi-Flor, two complementary prescription fluoride-based supplement product lines containing combinations of fluoride and vitamins in various formulations for infants and children with fluoride deficiency. During the fourth quarter of fiscal 2024, we successfully completed the transition of all manufacturing of our ADHD products to a United States-based third-party contract manufacturer to improve the profitability of these products.

In light of our own business activities and external developments in the biopharmaceutical industry, we regularly review our performance, prospects and risks such as the potential impact to our business resulting from our competitive landscape (i.e., entry of generic competitors, incremental payer pressures, new branded entrants, market events, etc.). These reviews have included consideration of potential partnerships, collaborations, and other strategic transactions such as licensing, acquisitions or divestitures of products, programs or technology to enhance stockholder value. We continue to evaluate potential strategic transactions (inclusive of seeking product licenses and/or acquisitions and potential business combinations), but there can be no guarantee that we will be able to enter into such transactions, and there can be no guarantee that such transactions will achieve our desired goals.

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**Significant Developments**

***Business Environment***

We continue to experience inflationary pressures and could experience supply chain disruptions related to the sourcing of raw materials, energy, logistics and labor for a number of reasons, including ongoing geopolitical events. While we do not have sales or operations in Russia or Ukraine and we do not have significant sales or operations in the Middle East, it is possible that the conflicts or actions taken in response, could adversely affect some of our markets and suppliers, economic and financial markets, costs and availability of energy and materials, or cause further supply chain disruptions. Inflationary pressures and supply chain disruptions could be significant across the business throughout fiscal 2025 and into fiscal 2026. Understanding these risks, we have not experienced stock outages for our ADHD products since the launch of those products, and the pediatric product supply has remained adequate to satisfy demand for the preceding four years.

In October 2024, we received a Notice Letter from Granules, stating that it intends to market a generic version of Adzenys before the expiration of all patents currently listed in the Orange Book. The Notice Letter states that Granules' NDA for the generic version of Adzenys contains a Paragraph IV certification alleging that these patents are not valid, not enforceable, and/or will not be infringed by the commercial manufacture, use or sale of the generic version of Adzenys. We timely filed a patent infringement lawsuit on December 11, 2024, against Granules to trigger a stay precluding the FDA from approving Granules' NDA for a generic version of Adzenys for up to 30 months or entry of judgment holding the patents invalid, unenforceable, or not infringed, whichever occurs first. On January 7, 2025, Granules submitted an answer to the complaint. This litigation is ongoing, and a trial has been scheduled to begin on December 7, 2026. We plan to vigorously enforce our intellectual property rights related to Adzenys.

***Major Depressive Disorder Exclusive Commercialization Agreement***

Shortly after effectiveness of this registration statement, we anticipate entering into the Agreement with Fabre-Kramer, pursuant to which we will acquire certain rights and obligations in connection with the commercialization of the Product at any time before or during the term of the Agreement in the Territory. EXXUA is a first-in-class, FDA-approved treatment for MDD with a novel mechanism of action and differentiated clinical profile, and, upon the execution of the Agreement, we intend to launch EXXUA by the end of the second fiscal quarter of 2026 through our commercial team. EXXUA has been extensively studied in over 5,000 patients and represents a new class of therapeutics to compete in the $22 billion United States prescription MDD market. It can become a very important treatment option for the over 21 million Americans affected by MDD. Over 340 million antidepressant prescriptions were written in 2024 in the United States, yet significant unmet needs remain considering the unacceptable side effects associated with current therapeutics.

As consideration for the Agreement, we will make an upfront cash payment of $3,000,000 to Fabre-Kramer on the effective date of the Agreement. Within forty-five (45) days of the one-year anniversary of the first physical sale of Product in the Territory through a bona fide, arm's length transaction to distribute the Product into the commercial channel for the purpose of fulfilling the Product prescription demand and subsequent dispensing, we will make a Second Payment. The Second Payment may be increased to $5,000,000 first year Product net sales meet or exceed $35 million. Additionally, we will pay Fabre-Kramer certain milestone payments ranging from $5,000,000 to over $100,000,000 per year based on sales milestones after a certain level of net sales are achieved with a threshold of $100,000,000 in net sales and the Company will pay 10% of net sales exceeding $1 billion. We will also pay royalty fees throughout the term of the Agreement based on the Company's net sales of the Product as follows: (i) initially 28% of net sales and increasing to 39% if net sales exceed $300 million in any year during Term until such net sales reach a reduced royalty trigger; and (ii) after reaching such royalty trigger, 24.5% and increasing to 35.5% if net sales exceed the royalty threshold. The Company will also pay a supply price of 3% of net sales less its cost of goods sold, increasing to 4% of net sales if annual net sales exceed $300 million. The Agreement also contains customary clauses for pharmaceutical commercialization agreements, including, among others, post-marketing trials and obligations, regulatory matters, and indemnification.

The Agreement may be terminated at any time upon mutual agreement between us and Fabre-Kramer. Either party may terminate the Agreement at any time upon written notice for a material default or breach if the material default or breach is not cured within (1) ninety (90) days after written notice or (2) in the case of a breach that cannot be cured within ninety (90) days, within a reasonable period not exceeding one hundred and twenty (120) days after written notice. Additionally, either party may terminate the Agreement at any time upon writing notice if (1) either party withdraws the Product from the market in the Territory for safety reasons or (2)(i) the FDA materially restricts the indications for the Product, or (ii) federal or state pricing controls are imposed that would result in obvious or substantial loss of sales for the Product.

In addition, we are in discussions to potentially acquire a novel treatment for a psychiatric condition, but these discussions are in the early stages. Thus, the outcome of these discussions cannot be determined at this time. If agreed upon, we would expect to acquire an FDA-approved, branded treatment for a psychiatric condition through an asset purchase agreement and similarly commercialize it through our commercial infrastructure with largely existing resources and personnel.

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***ADHD Portfolio***

During the fourth quarter of fiscal 2024, we successfully completed the transition of all manufacturing of our ADHD products to a United States-based third-party manufacturer to improve the profitability of these products.

As part of our realization of post-acquisition synergies and product prioritization, we have implemented a portfolio rationalization plan whereby we discontinued or divested five non-core products in our ADHD Portfolio and Pediatric Portfolio: Cefaclor Oral Suspension, Flexichamber, Tussionex, Tuzistra XR, and ZolpiMist. These products, collectively, contributed $0.1 million and $1.6 million in net revenue during the years ended June 30, 2024, and 2023, respectively.

In July 2023, we entered into an exclusive collaboration, distribution and supply agreement with Medomie, a privately owned pharmaceutical company, for Medomie to commercialize Adzenys and Cotempla in Israel and the Palestinian Authority. In September 2024, we entered into an exclusive collaboration, distribution and supply agreement with Lupin, a subsidiary of global pharmaceutical company Lupin Limited, for Lupin to commercialize Adzenys and Cotempla in Canada. We will supply Adzenys and Cotempla to Medomie and Lupin based on forecasts and provide various product commercialization resources. Medomie and Lupin are responsible for seeking local regulatory approvals and marketing authorizations for both Adzenys and Cotempla, which is expected to occur over the next 24 months. The agreements with Medomie and Lupin represent our first and second international commercial agreements for Adzenys and Cotempla, respectively.

***Debt and Equity Financings***

*Eclipse Agreement*

In June 2024, we and certain of our subsidiaries entered into the Eclipse Amendment No. 5, with the Eclipse Lender. Under the Eclipse Agreement No. 5, we have two loan agreements, the Eclipse Term Loan and the Eclipse Revolving Loan.

The Eclipse Term Loan consists of a principal amount of $13.0 million, at an interest rate of SOFR plus 7.0%, with a four-year term and a straight-line loan amortization period of seven years, which would provide for a loan balance at the end of the four-year term of $5.6 million to be repaid on June 12, 2028, the maturity date. We used the proceeds of the Eclipse Term Loan and a portion of the proceeds from warrant exercises described below to repay in full a $15.0 million term note.

The Eclipse Revolving Loan allows us to borrow up to $14.5 million at an interest rate of SOFR plus 4.5%. In addition, we are required to pay an unused line fee of 0.5% of the average unused portion of the maximum Eclipse Revolving Loan amount during the immediately preceding month. The ability to make borrowings and obtain advances of the Eclipse Revolving Loan remains subject to a borrowing base and reserve, and availability blockage requirements and the maturity date, as amended, is June 12, 2028.

*Equity Financings*

In June 2023, we raised gross proceeds of $4.0 million from the issuance of (i) 1,743,695 shares of our common stock, and (ii) in lieu of common stock to certain investors that so chose, pre-funded warrants to purchase 430,217 shares of common stock (the "June 2023 Pre-Funded Warrants") and (iii), accompanying Tranche A warrants to purchase 2,173,912 shares of common stock at an exercise price of $1.59 (the "Tranche A Warrants"), (iv) and accompanying Tranche B warrants to purchase 2,173,912 shares of common stock at an exercise price of $1.59 (the "Tranche B Warrants"). We received $3.4 million in proceeds net of underwriting fees and other expenses.

In June 2024, the Tranche B Warrants were exercised, generating proceeds of $3.5 million. The Tranche B Warrants were converted into 367,478 shares of common stock and 1,806,434 "pre-funded" warrants to purchase shares of common stock with an exercise price of $0.0001 per share (the "Tranche B Pre-Funded Warrants"). We used a portion of these proceeds as part of the $15.0 million term loan repayment described above.

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**Results of Operations**

The results of operations for the year ended June 30, 2024, compared to the year ended June 30, 2023, is as follows:

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| | | | |
|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** | **Year Ended** |
|  | **June 30,** | **June 30,** | **June 30,** |
|  | **2024** | **2023** | **Change** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** |
| Net revenue | $65183 | $73799 | $(8616) |
| Cost of sales | 16129 | 21570 | (5441) |
| Gross profit | 49054 | 52229 | (3175) |
| Operating expenses: |  |  |  |
| Selling and marketing | 22083 | 24231 | (2148) |
| General and administrative | 19954 | 25534 | (5580) |
| Research and development | 2769 | 3979 | (1210) |
| Amortization of intangible assets | 3683 | 3691 | (8) |
| Restructuring costs | 2156 |  | 2156 |
| Impairment expense |  | 2730 | (2730) |
| Gain from contingent consideration |  | (578) | 578 |
| Total operating expenses | 50645 | 59587 | (8942) |
| **Loss from operations** | **(1591)** | **(7358)** | **5767** |
| Other income, net | 870 | 425 | 445 |
| Interest expense | (5059) | (5149) | 90 |
| Derivative warrant liabilities (loss) gain | (4004) | 4793 | (8797) |
| Loss on extinguishment of debt | (594) |  | (594) |
| **Loss from continuing operations before income tax expense** | **(10378)** | **(7289)** | **(3089)** |
| Income tax expense | (2142) | (263) | (1879) |
| **Net loss from continuing operations** | **(12520)** | **(7552)** | **(4968)** |
| Net loss from discontinued operations, net of tax | (3324) | (9499) | 6175 |
| **Net loss** | $**(15844)** | $**(17051)** | $**1207** |

---

***Net Revenue by Portfolio***

Net revenue by portfolio for the year ended June 30, 2024, compared to the year ended June 30, 2023, is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** | **Year Ended** |
|  | **June 30,** | **June 30,** | **June 30,** |
|  | **2024** | **2023** | **Change** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** |
| ADHD Portfolio | $57784 | $46855 | $10929 |
| Pediatric Portfolio | 7280 | 25377 | (18097) |
| Other | 119 | 1567 | (1448) |
| Total net revenue | $65183 | $73799 | $(8616) |

---

During the year ended June 30, 2024, total net revenue decreased by $8.6 million, or 12% compared to the year ended June 30, 2023. This is primarily due to a $18.1 million decrease in net revenue from our Pediatric Portfolio, which was driven by payer changes that negatively affected prescription coverage, and a $1.4 million decrease that resulted from the discontinuation of certain products. These declines were partially offset by an increase in net revenue from the ADHD Portfolio of $10.9 million, driven by a consistent and reliable supply of our ADHD Portfolio products and strong commercial execution.

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***Gross Profit***

Gross profit and gross profit percentage for the year ended June 30, 2024, compared to the year ended June 30, 2023, were as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** | **Year Ended** |
|  | **June 30,** | **June 30,** | **June 30,** |
|  | **2024** | **2023** | **Change** |
| Gross profit | $49054 | $52229 | $(3175) |
| Gross profit percentage | 75% | 62% | 13% |

---

During the year ended June 30, 2024, gross profit decreased by $3.2 million, or 6% compared to the year ended June 30, 2023. Gross profit percentage increased to 75% for the year ended June 30, 2024, compared to 62% for the year ended June 30, 2023. The improvement was primarily due to improvements in the gross margin ADHD Portfolio, which were primarily due to efficiencies in production related to higher demand for Adzenys and Cotempla.

***Selling and Marketing***

During the year ended June 30, 2024, other selling and marketing expense decreased by $2.1 million, or 9%, compared to the year ended June 30, 2023. The decreases were primarily driven by commission expense based on prescriptions generated by our sales force and commercial marketing program fees that decrease as product sales decreased.

***General and Administrative***

During the year ended June 30, 2024, general and administrative expense decreased by $5.6 million or 22%, compared to the year ended June 30, 2023. The decrease was primarily a result of ongoing cost-cutting initiatives and operational improvements. We expect general and administrative expense to decrease during fiscal 2025 primarily from reduced costs associated with the successful transition of our ADHD product manufacturing out of our Grand Prairie, Texas-based manufacturing facility to a United States-based CMO.

***Research and Development***

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** | **Year Ended** |
|  | **June 30,** | **June 30,** | **June 30,** |
|  | **2024** | **2023** | **Change** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** |
| Research and development: |  |  |  |
| AR101 | $973 | $1880 | $(907) |
| ADHD | 1743 | 1803 | (60) |
| Healight | 10 | 250 | (240) |
| Others | 43 | 46 | (3) |
| Total research and development | $2769 | $3979 | $(1210) |

---

During the year ended June 30, 2024, research and development expense decreased by $1.2 million, or 30%, compared to the year ended June 30, 2023. Historically, our research and development costs were primarily associated with AR101 and to a lesser extent, the development of Healight and support for our commercialized products. In October 2022, we announced the suspension of the development of AR101 and Healight to focus on our commercial operations. As a result, research and development spending has significantly declined. Research and development spending on AR101 during fiscal 2024 relates primarily to charges to wind down the clinical trial and to minimum expenses required for regulatory filings and maintenance of our AR101 intellectual property, and spending on ADHD relates to regulatory filings and maintenance of our intellectual property. We expect our research and development expenses to slightly decrease in the future as we continue to look for cost savings and focus on commercial operations.

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***Amortization of Intangible Assets***

During the year ended June 30, 2024, amortization expense of intangible assets, excluding amounts included in cost of sales, were relatively consistent compared to the year ended June 30, 2023. We expect amortization expense of intangible assets to remain relatively consistent.

***Restructuring Costs***

During the year ended June 30, 2023, we recognized $2.2 million of restructuring costs, related to the closure of our Grand Prairie, Texas manufacturing site. We expect restructuring costs to decrease during fiscal 2025 as the majority of our restructuring activities were completed during fiscal 2024. See *Note 17 – Restructuring Costs* in the accompanying notes to the consolidated financial statements later in this prospectus for further information.

***Impairment Expense***

During the year ended June 30, 2024, there was no impairment expense recorded except for impairment expense related to exit and disposal activities recorded to the restructuring costs financial statement line item discussed above and we do not anticipate impairment charges during fiscal 2025 at this time.

During the year ended June 30, 2023, we recognized total impairment expense of $2.7 million, which were primarily the result of our increased focus on our commercial efforts in the ADHD Portfolio and Pediatric Portfolio. See *Note 7* – *Intangible Assets* in the accompanying notes to the consolidated financial statements later in this prospectus for further information.

***Gain from Contingent Consideration***

We fair value our acquisition-related contingent considerations based on our projected results, any changes are reflected through income or expense. During the year ended June 30, 2024, there was no gain from contingent consideration, compared to $0.6 million for the year ended June 30, 2023. The decrease was primarily due to all contingent considerations expiring or winding down during fiscal 2023. As a result, we do not expect any contingent consideration gain or loss in fiscal 2025.

***Other Income, Net***

During the year ended June 30, 2024, other income, net was $0.9 million or 105% higher compared to the year ended June 30, 2023, primarily due to $0.5 million in other income from insurance proceeds for damaged inventory recorded in the first quarter of fiscal 2024. We expect other income, net to continue to be relatively consistent during fiscal 2025.

***Interest Expense***

During the year ended June 30, 2024, interest expense was relatively consistent compared to the year ended June 30, 2023. We expect interest expense to decrease during fiscal 2025 due to the extinguishment of our $15.0 million term loan while entering into the $13.0 million Eclipse Term Loan on more favorable terms.

***Derivative Warrant Liabilities (Loss) Gain***

The fair value of derivative warrant liabilities is calculated using either the Black-Scholes option pricing model or the Monte Carlo simulation model are revalued at each reporting period and changes are reflected through income or expense. For the year ended June 30, 2024, we recognized an unrealized loss of $4.0 million from the fair value adjustment primarily driven by an increase in our stock price during fiscal 2024. For the year ended June 30, 2023, we recognized an unrealized gain of $4.8 million from the fair value adjustment primarily driven by a decrease in our stock price during fiscal 2023.

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***Loss on Extinguishment of Debt***

During the year ended June 30, 2024, we recorded a $0.6 million loss on extinguishment of debt due to the extinguishment of our $15.0 million term loan. We recorded no loss on extinguishment of debt during the year ended June 30, 2023.

***Income Tax Expense***

For the year ended 2024, there was $2.1 million of income tax expense, which was an effective tax rate of negative 20.6%. This income tax expense was primarily driven by the limitations on losses as a result of Section 382 of the Internal Revenue Code of 1986, as amended (the "IRC"), changes in ownership coupled with existing valuation allowances. We expect that income tax expense will increase during fiscal 2025 due primarily to increased profitability.

For the year ended 2023, income tax expense was $0.3 million with an effective tax rate of negative 3.6% and reflecting the full valuation allowance. This income tax expense was primarily driven by the limitations on losses as a result of Section 382 of the IRC changes in ownership coupled with existing valuation allowances and release of the naked credit.

***Net Loss from Discontinued Operations, Net of Tax***

Net loss from discontinued operations, net of tax is related to the wind down and divestiture of our Consumer Health business that was completed in the first quarter of fiscal 2025. See *Note 20* – *Discontinued Operations* in the accompanying notes to the consolidated financial statements later in this prospectus for further information.

**Liquidity and Capital Resources**

***Cash Flows***

The following table sets forth the primary sources and uses of cash for the periods indicated:

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| | | | |
|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** | **Year Ended** |
|  | **June 30,** | **June 30,** | **June 30,** |
|  | **2024** | **2023** | **Change** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** |
| Net cash used in operating activities | $(1388) | $(5129) | $3741 |
| Net cash used in provided by investing activities | $(329) | $(117) | $(212) |
| Net cash (used in) provided by financing activities | $(1262) | $8871 | $(10133) |

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*Net Cash Used in Operating Activities*

Net cash used in operating activities during these periods primarily reflected our net losses, partially offset by changes in working capital and non-cash charges including impairment, stock-based compensation expense, gain or loss on derivative warrant liabilities, depreciation, amortization and accretion, adjustments from discontinued operations and other charges.

During the year ended June 30, 2024, net cash used in operating activities totaled $1.4 million. The use of cash was primarily the result of the decrease in accounts payable and accrued liabilities and an increase in inventories, partially offset by positive cash earnings (net loss offset by non-cash items primarily from depreciation, amortization and accretion, stock-based compensation expense, derivative warrant liabilities adjustment, inventory write-down, adjustments from discontinued operations and other certain non-cash adjustments). Additionally, these were partially offset by funds from the Employee Retention Credit program recorded in other operating liabilities and a decrease in accounts receivable, net and a net decrease in various other operating assets and liabilities.

During the fiscal year ended June 30, 2023, net cash used in operating activities totaled $5.1 million. The decrease in net cash used was primarily the result of the decrease in operating loss, and increases in accounts payable and accrued liabilities, partially offset by an increase in accounts receivable, inventory, and prepaid expenses.

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*Net Cash Used in Investing Activities*

Net cash used in investing activities is generally related to our merger and acquisitions as well as purchase of assets to support our operations and disposal of assets related to exit and disposal costs.

Net cash used in investing activities was $0.3 million during the year ended June 30, 2024, and net cash used in investing activities was $0.1 million during the year ended June 30, 2023, which was primarily used for the purchase of various property and equipment.

*Net Cash from Financing Activities*

Net cash used in financing activities of $1.3 million during the year ended June 30, 2024, was primarily from $15.7 million of payments made related to the extinguishment of our term loan, $2.6 million for fixed payment arrangements and $0.3 million of payments for debt issuance costs. This financing cash used was partially offset by $13.0 million of proceeds from the Eclipse Term Loan, $3.5 million of net proceeds from the issuance of common stock and warrants and $0.9 million of proceeds from our Eclipse Revolving Loan.

Net cash provided by financing activities of $8.9 million during the year ended June 30, 2023, was primarily from $3.4 million of net proceeds from our securities purchase agreement in June 2023, $9.1 million of net proceeds from our August 2022 equity raise, and $2.9 million net proceeds from our sales under the ATM Sales Agreement; partially offset by $2.3 million of net payments made under our revolving credit facility, and fixed payment arrangements totaling $4.3 million.

***Capital Resources***

*Sources of Liquidity*

We have obligations related to our loan agreements, milestone payments for licensed products, and manufacturing purchase commitments. We finance our operations through a combination of sales of our common stock and warrants, borrowings under our line of credit facility and from cash generated from operations.

*Shelf Registrations*

On September 26, 2024, we filed a shelf registration statement on Form S-3, which was declared effective by the SEC on October 15, 2024. This shelf registration statement covers the offering, issuance and sale by us of up to an aggregate of $100.0 million of our common stock, preferred stock, debt securities, warrants, rights and units (the "2024 Shelf"). Through the filing date of this Form 10-Q, $100.0 million remains available under the 2024 Shelf. This availability is subject to the SEC's "baby shelf" limitation as set forth in SEC Instruction I.B.6 limitation to the Form S-3.

*Underwriting & Placement Agency Agreements*

On June 8, 2023, we entered into a securities purchase agreement with certain institutional investors named therein and a placement agency agreement with Maxim Group LLC, pursuant to which the Company agreed in a best efforts offering to issue and sell to investors in the offering an aggregate of 1,743,695 shares of the Company's common stock, pre-funded warrants in lieu of shares to purchase 430,217 shares of common stock at an exercise price of $0.0001, accompanying Tranche A warrants to purchase 2,173,912 shares of common stock at an exercise price of $1.59 (the "Tranche A Warrants"), and accompanying Tranche B warrants to purchase 2,173,912 shares of common stock at an exercise price of $1.59 (the "Tranche B Warrants"). The Tranche A Warrants and the Tranche B Warrants may be exercised for either shares of common stock or pre-funded warrants to purchase common stock at a future exercise price of $0.0001 per share in the same form as the pre-funded warrant. The gross proceeds were $4.0 million, and net proceeds were $3.4 million after deducting offering expenses. The offering closed on June 13, 2023. In June 2024, the Tranche B Warrants were exercised, generating proceeds of $3.5 million. The Tranche B Warrants were converted into 367,478 shares of common stock and 1,806,434 pre-funded warrants to purchase shares of common stock with an exercise price of $0.0001 per share (the "Tranche B Pre-Funded Warrants"). We used a portion of these proceeds as part of the $15.0 million term loan repayment that occurred in the fourth quarter of fiscal 2024.

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On August 11, 2022, we closed an underwritten public offering, pursuant to which we sold an aggregate of (i) 1,075,290 shares of our common stock, (ii), pre-funded warrants to purchase 87,500 shares of our common stock, and (ii) accompanying warrants to purchase 1,265,547 shares of our common stock. The shares of common stock (or pre-funded warrants) and the accompanying common warrants were issued separately but could only be purchased together. The combined public offering price for each share of common stock and accompanying common warrant was $8.60, and the combined offering price for each pre-funded warrant and accompanying common warrant is $8.58, which equals the public offering price per share of the common stock and accompanying common warrant, less the $0.001 per share exercise price of each pre-funded warrant. The pre-funded warrants were exercised in full in August 2022. The common warrants are exercisable at any time after the date of issuance for a period of five years from the date such common warrants are first exercisable. The number of shares of common stock issuable upon exercise of the common warrants is subject to adjustment in certain circumstances, including a stock split of, stock dividend on, or a subdivision, combination or recapitalization of the common stock. The Company received gross proceeds of $10.0 million and net proceeds were $9.1 million, after deducting underwriting discounts and commissions and estimated offering expenses.

*Avenue Capital Agreement*

On January 26, 2022, we entered into the Avenue Capital Agreement, pursuant to which the Company received $15.0 million term loan. In the fourth quarter of fiscal 2024, we repaid this term loan in full with proceeds from the Eclipse Term Loan and a portion of the proceeds from the exercise of the Tranche B Warrants.

*Eclipse Agreement*

In June 2024, we and certain of our subsidiaries entered into the Eclipse Amendment No. 5, with the Eclipse Lender. Under the Eclipse Agreement No. 5, we have two loan agreements, the Eclipse Term Loan and the Eclipse Revolving Loan.

The Eclipse Term Loan consists of a principal amount of $13.0 million, at an interest rate of SOFR plus 7.0%, with a four-year term and a straight-line loan amortization period of seven years, which would provide for a loan balance at the end of the four-year term of $5.6 million to be repaid on June 12, 2028, the maturity date. We used the proceeds of the Eclipse Term Loan and a portion of the proceeds from warrant exercises described below to repay in full a $15.0 million term note.

The Eclipse Revolving Loan allows us to borrow up to $14.5 million at an interest rate of SOFR plus 4.5%. In addition, we are required to pay an unused line fee of 0.5% of the average unused portion of the maximum Eclipse Revolving Loan amount during the immediately preceding month. The ability to make borrowings and obtain advances of the Eclipse Revolving Loan remains subject to a borrowing base and reserve, and availability blockage requirements and the maturity date, as amended, is June 12, 2028.

**Contractual Obligations, Commitments and Contingencies**

As a result of our acquisitions and licensing agreements, we are contractually and contingently obliged to pay, when due, various fixed and contingent milestone payments. See *Note 18* – *Commitments and Contingencies* in the accompanying notes to the consolidated financial statements later in this prospectus for further information.

In May 2022, we entered into an agreement with Tris to terminate the License, Development, Manufacturing and Supply Agreement dated November 2, 2018, related to Tuzistra (the "Tuzistra License Agreement"). Pursuant to such termination, as of June 30, 2024, we have accrued a settlement liability of $6.2 million payable to Tris, with a provision that allows us to pay interest on any principal amounts due but remaining unpaid past July 2024.

Upon closing of the acquisition of a line of prescription pediatric products from Cerecor, Inc. in October 2019, we assumed payment obligations that require us to make fixed and product milestone payments. As of June 30, 2024, up to $2.1 million of fixed and product milestone payments remain to be paid through 2026 and are expected to be paid from the revenue generated by Karbinal.

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In connection with our acquisition of the assets from Rumpus VEDS, LLC, Rumpus Therapeutics, LLC, Rumpus Vascular, LLC (collectively, "Rumpus"), and only if we resume and ultimately complete clinical development of AR101 and gain regulatory clearances to commercialize the product in multiple markets around the world, we may be required to pay up to $67.5 million in regulatory and commercial-based earn-out payments to Rumpus, which are primarily paid against commercial milestone achievements. Under the licensing agreement with Denovo Biopharma LLC ("Denovo"), we made a payment of $0.6 million for a license fee in April 2022. In addition, upon the achievement of regulatory and commercial milestones, we may be required to pay up to $101.7 million. Under the licensing agreement with Johns Hopkins University ("JHU"), upon achievement of regulatory and commercial milestone, we may be required to pay up to $1.6 million to JHU. In fiscal 2022, two milestones payable to Rumpus were achieved totaling $4.0 million, which were paid in 109,447 shares of common stock and $2.6 million in cash. The Company also assumed the responsibility for royalties of 3.0% of net revenue from the product, with a minimum of $20,000 per year, and upon the achievement of certain regulatory and commercial milestones, up to $1.6 million. With clinical development currently suspended, only if and when we resume and ultimately complete clinical development of AR101, are substantially all milestones payable to these parties.

**Critical Accounting Estimates**

Our management's discussion and analysis of financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). The preparation of our consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of any contingent assets and liabilities at the date of the consolidated financial statements, as well as reported revenue and expenses during the reporting periods. On an ongoing basis, we evaluate our estimates and judgments. We base our estimates on our historical experience and on various other assumptions that we believe to be reasonable under the circumstances. These estimates and assumptions form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Our actual results may differ materially from these estimates under different assumptions or conditions.

While our significant accounting policies are described in more detail in *Note 2* – *Summary of Significant Accounting Policies* in the accompanying notes to the consolidated financial statements later in this prospectus for further information, we believe the following accounting policies to be critical to the judgments and estimates used in the preparation of our consolidated financial statements and notes thereto.

***Revenue Recognition***

We generate revenue from continuing operations from product sales through our ADHD Portfolio and our Pediatric Portfolio. We evaluate our contracts with customers to determine revenue recognition using the following five-step model: (1) identify the contract with the customer; (2) identify the performance obligations and if they are distinct; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations; and (5) recognize revenue when (or as) a performance obligation is satisfied.

Net product sales consist of sales of prescription pharmaceutical products, principally to a limited number of wholesale distributors and pharmacies in the United States. Prescription product revenue is recognized at the point in time that control of the product transfers to the customer in accordance with shipping terms (i.e., upon delivery), which is generally "free-on-board" destination when shipped domestically within the United States and "free-on-board" shipping point when shipped internationally consistent with the contractual terms.

We make estimates of the net sales price, including estimates of variable consideration to be incurred on the respective product sales (known as "Gross to Net" adjustments). Significant judgement is required in estimating Gross to Net adjustments considering legal interpretations of applicable laws and regulations, historical experience, payer channel mix, current contract prices under applicable programs, unbilled claims, processing time lags and inventory levels in the distribution channel.

The Gross to Net adjustments includes:

● *Savings offers.* The Company offers savings programs for its patients covered under commercial payor plans in which the cost of a prescription to such patients is discounted.

● *Prompt payment discounts.* Prompt payment discounts are based on standard provisions of wholesalers' services.

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● *Wholesale distribution fees.* Wholesale distribution fees are based on definitive contractual agreements for the management of the Company's products by wholesalers.

● *Rebates.* The Rx Portfolio products are subject to commercial managed care and government (i.e. Medicaid) programs whereby discounts and rebates are provided to participating managed care organizations and federal and/or state governments. Calculations related to rebate accruals are estimated based on historical information from third-party providers.

● *Wholesaler chargebacks.* The Rx Portfolio products are subject to certain programs with wholesalers whereby pricing on products is discounted below wholesaler list price to participating entities. These entities purchase products through wholesalers at the discounted price, and the wholesalers charge the difference between their acquisition cost and the discounted price back to the Company following the product purchases of the wholesalers' end customers.

● *Returns.* Wholesalers' contractual return rights are limited to defective product, product that was shipped in error, product ordered by customer in error, product returned due to overstock, product returned due to dating or product returned due to recall or other changes in regulatory guidelines. The return policy for expired product allows the wholesaler to return such product starting six months prior to expiry date to twelve months post expiry date. The Company analyzes return data available from sales since inception date to determine a reliable return rate.

Savings offers, rebates and wholesaler chargebacks reflect the terms of underlying agreements, which may vary. Accordingly, actual amounts will depend on the mix of sales by product and contracting entity. Future returns may not follow historical trends. Our periodic adjustments of our estimates are subject to time delays between the initial product sale and ultimate reporting and settlement of deductions. We continually monitor these provisions and do not believe variances between actual and estimated amounts have been material.

**Impairment of Long-lived Assets**

We assess impairment of long-lived assets annually and when events or changes in circumstances indicates that their carrying value amount may not be recoverable. Long-lived assets consist of property and equipment, net and other intangible assets, net. Circumstances which could trigger a review include but are not limited to: (i) significant decreases in the market price of the asset; (ii) significant adverse changes in the business climate or legal or regulatory factors; (iii) changes in business plans or (iv) expectations that the asset will more likely than not be sold or disposed of significantly before the end of its estimated useful life. If the estimated future undiscounted cash flows, excluding interest charges, from the use of an asset are less than the carrying value, a write-down would be recorded to reduce the related asset to its estimated fair value. Such estimates involve projections of future sales and costs, which may vary from actual results. Declines in the outlook for the related products, particularly soon after fair-value measurement upon acquisition or prior impairment, can negatively impact our ability to recover the carrying value and can result in an impairment charge.

Our strategy is to continue building our portfolio of revenue-generating products by leveraging our commercial team's expertise to build leading brands within large therapeutic markets. As a result of focusing on building the portfolio of revenue-generating prescription products, we decided to abandon active development of our NT0502 (N-desethyloxybutynin), a new chemical entity that is being developed for the treatment of sialorrhea, which is excessive salivation or drooling. During the year ended June 30, 2023, we incurred an impairment charge of $2.6 million related to NT0502 and have terminated the licensing agreement. We also terminated the license agreement with Cedars-Sinai Medical Center surrounding the Healight technology platform as an additional result of terminating the development of the Healight program.

During the year ended June 30, 2024, related to the closure of our Grand Prairie, Texas manufacturing facility we recorded restructuring costs totaling $2.2 million related to severance costs and the abandonment of our leased manufacturing facility, equipment and other assets. The restructuring costs have been recorded in restructuring costs on the consolidated statements of operations.

**Warrants**

Equity classified warrants are valued using a Black-Scholes option pricing model at issuance and are not remeasured. Liability classified warrants are carried at fair value using either the Black-Scholes option pricing model or the Monte Carlo simulation model. Changes in the fair value of liability classified warrants in subsequent periods are recorded as a gain or loss on remeasurement and reported as a component of cash flows from operations.

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**DESCRIPTION OF SECURITIES**

We are offering 6,741,573 shares of our Common Stock (or Prefunded Warrants in lieu of our Common Stock). We are offering Prefunded Warrants to those purchasers whose purchase of shares of our Common Stock in this offering would result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the election of the purchaser, a lesser percentage or greater percentage up to 19.99%) of our outstanding shares of Common Stock following the consummation of this offering in lieu of the shares of Common Stock that would result in such excess ownership. For each Prefunded Warrant we sell, the number of shares of Common Stock we sell in this offering will be decreased on a one-for-one basis.

We are also registering the shares of our Common Stock issuable from time to time upon exercise of the Prefunded Warrants offered hereby. The following descriptions of our Common Stock and Prefunded Warrants and certain provisions of our Certificate of Incorporation, our by-laws and Delaware law are summaries. You should also refer to our Certificate of Incorporation and our by-laws, which are filed as exhibits to the registration statement of which this prospectus is part.

**Authorized Capital Stock**

We are authorized to issue 250,000,000 shares of our capital stock consisting of (a) 200,000,000 shares of Common Stock, par value $0.0001 per share, and (b) 50,000,000 shares of preferred stock, par value $0.0001 per share. As of March 31, 2025, 6,170,162 shares of our Common Stock were issued and outstanding and no shares of our preferred stock were issued and outstanding.

**Common Stock**

The description of our Common Stock is incorporated by reference to [<u>Exhibit 4.9 to our Annual Report on Form 10-K for the fiscal year ended June 30, 2024, filed with the SEC on September 26, 2024</u>](http://www.sec.gov/ix?doc=/Archives/edgar/data/0001385818/000143774924030062/aytu20240630_10k.htm). Our Common Stock is traded on Nasdaq under the symbol "AYTU." The transfer agent and registrar for our Common Stock is Direct Transfer, LLC. The transfer agent's address is One Glenwood Avenue, Suite 1001, Raleigh, North Carolina 27603.

**Prefunded Warrants**

*The following summary of certain terms and provisions of the Prefunded Warrants that are being offered hereby is not complete and is subject to, and qualified in its entirety by, the provisions of the Prefunded Warrants, the forms of which are filed as an exhibit to the registration statement of which this prospectus forms a part. Prospective investors should carefully review the terms and provisions of the forms of warrant for a complete description of the terms and conditions of the warrants.*

*Exercisability*. The Prefunded Warrants are exercisable at any time after their original issuance until they are exercised in full. The holder may elect to exercise the Prefunded Warrants through a cashless exercise, in which case the holder would receive upon such exercise the net number of shares of Common Stock determined according to the formula set forth in the Prefunded Warrants, as applicable. No fractional shares of Common Stock will be issued in connection with the exercise of a Prefunded Warrant. In lieu of fractional shares, we will at our discretion, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the exercise price or round up to the next whole share.

*Exercise Limitation*. A holder will not have the right to exercise any portion of the Prefunded Warrants if the holder (together with its affiliates) would beneficially own in excess of 4.99% or 19.99% of the number of shares of Common Stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the Prefunded Warrants. However, any holder may increase or decrease such percentage to any other percentage not in excess of 19.99%, upon at least 61 days' prior notice from the holder to us with respect to any increase in such percentage.

*Exercise Price*. The exercise price for the Prefunded Warrants is $0.0001 per share. The exercise price and number of shares of Common Stock issuable upon exercise will adjust in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications, dilutive issuances or similar events.

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*Transferability*. Subject to applicable laws, the Prefunded Warrants may be offered for sale, sold, transferred or assigned without our consent.

*Exchange Listing*. We do not intend to apply for the listing of the Prefunded Warrants offered in this offering on any stock exchange. Without an active trading market, the liquidity of the Prefunded Warrants will be limited.

*Rights as a Stockholder*. Except as otherwise provided in the Prefunded Warrants or by virtue of such holder's ownership of our shares of Common Stock, the holder of a Prefunded Warrant does not have the rights or privileges of a holder of our shares of Common Stock, including any voting rights, until the holder exercises the Prefunded Warrant.

*Fundamental Transactions*. In the event of a fundamental transaction, as described in the Prefunded Warrants, and generally including, with certain exceptions, any reorganization, recapitalization or reclassification of our shares of Common Stock, the sale, transfer or other disposition of all or substantially all of our properties or assets, our consolidation or merger with or into another person, the acquisition of more than 50% of our outstanding shares of Common Stock, or any person or group becoming the beneficial owner of 50% of the voting power represented by our outstanding shares of Common Stock, the holders of the Prefunded Warrants will be entitled to receive upon exercise thereof the kind and amount of securities, cash or other property that the holders would have received had they exercised the warrants immediately prior to such fundamental transaction.

*Governing Law*. The Prefunded Warrants are governed by New York law.

**Anti-Takeover Effects of Provisions of the DGCL and our Certificate of Incorporation and Bylaws**

*Delaware Anti-Takeover Law*. We are subject to Section 203 of the Delaware General Corporation Law ("DGCL"). Section 203 generally prohibits a public Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a period of three years after the date of the transaction in which the person became an interested stockholder, unless:

● prior to the date of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;

● upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding specified shares; or

● at or subsequent to the date of the transaction, the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested stockholder.

Section 203 defines a "business combination" to include:

● any merger or consolidation involving the corporation and the interested stockholder;

● any sale, lease, exchange, mortgage, pledge, transfer or other disposition of 10% or more of the assets of the corporation to or with the interested stockholder;

● subject to exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;

● subject to exceptions, any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; or

● the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.

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In general, Section 203 defines an "interested stockholder" as any person that is:

● the owner of 15% or more of the outstanding voting stock of the corporation;

● an affiliate or associate of the corporation who was the owner of 15% or more of the outstanding voting stock of the corporation at any time within three years immediately prior to the relevant date; or

● the affiliates and associates of the above.

Under specific circumstances, Section 203 makes it more difficult for an "interested stockholder" to effect various business combinations with a corporation for a three-year period, although the stockholders may, by adopting an amendment to the corporation's certificate of incorporation or bylaws, elect not to be governed by this section, effective 12 months after adoption.

Our certificate of incorporation and bylaws do not exclude us from the restrictions of Section 203. We anticipate that the provisions of Section 203 might encourage companies interested in acquiring us to negotiate in advance with our board of directors since the stockholder approval requirement would be avoided if a majority of the directors then in office approve either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder.

*Certificate of Incorporation and Bylaws*. Provisions of our certificate of incorporation and bylaws may delay or discourage transactions involving an actual or potential change of control or change in our management, including transactions in which stockholders might otherwise receive a premium for their shares, or transactions that our stockholders might otherwise deem to be in their best interests. Therefore, these provisions could adversely affect the price of our Common Stock. Among other things, these provisions include:

● the authorization of 50,000,000 shares of "blank check" preferred stock, the rights, preferences and privileges of which may be established and shares of which may be issued by our Board of Directors at its discretion from time to time and without stockholder approval;

● limiting the removal of directors by the stockholders;

● allowing for the creation of a staggered board of directors;

● eliminating the ability of stockholders to call a special meeting of stockholders; and

● establishing advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted upon at stockholder meetings.

**Limitation on Directors**' **Liability; Indemnification**

Our bylaws contain provisions that limit the liability of our current and former directors for monetary damages to the fullest extent permitted by Delaware law. Delaware law provides that directors of a corporation will not be personally liable for monetary damages for any breach of fiduciary duties as directors, except liability for:

● any breach of the director's duty of loyalty to the corporation or its stockholders;

● any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

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● unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the DGCL; or

● any transaction from which the director derived an improper personal benefit.

This limitation of liability does not apply to liabilities arising under federal securities laws and does not affect the availability of equitable remedies such as injunctive relief or rescission.

Our bylaws provide that we are required to indemnify our directors to the fullest extent permitted by Delaware law. Our bylaws also provide that, upon satisfaction of certain conditions, we are required to advance expenses incurred by a director in advance of the final disposition of any action or proceeding, and permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in that capacity regardless of whether we would otherwise be permitted to indemnify him or her under the provisions of Delaware law. Our bylaws also provide our board of directors with discretion to indemnify our officers and employees when determined appropriate by our board of directors. We have entered into agreements to indemnify our directors, executive officers and other employees as determined by the board of directors. With certain exceptions, these agreements provide for indemnification for related expenses including, among other things, attorneys' fees, judgments, fines and settlement amounts incurred by any of these individuals in any action or proceeding. We believe that these provisions and agreements are necessary to attract and retain qualified persons as directors and officers. We also maintain customary directors' and officers' liability insurance.

The limitation of liability and indemnification provisions in our bylaws and indemnification agreements may discourage stockholders from bringing a lawsuit against our directors for breach of their fiduciary duty. They may also reduce the likelihood of derivative litigation against our directors and officers, even though an action, if successful, might benefit us and other stockholders. Further, a stockholder's investment may be adversely affected to the extent that we pay the costs of settlement and damage awards against directors and officers as required by these indemnification provisions. At present, there is no pending litigation or proceeding involving any of our directors, officers or employees for which indemnification is sought and we are not aware of any threatened litigation that may result in claims for indemnification.

**UNDERWRITING**

We have entered into an underwriting agreement with Lake Street Capital Markets LLC (the "Representative") acting as the representative of the underwriters listed in the table below. We refer to the several underwriters listed in the table below collectively as the "underwriters." Subject to the terms and conditions of the underwriting agreement, we have agreed to sell to the underwriters, and the underwriters have agreed to purchase from us, shares of our Common Stock or Prefunded Warrants in lieu thereof. Our Common Stock trades on Nasdaq under the symbol "AYTU."

Pursuant to the terms and subject to the conditions contained in the underwriting agreement, we have agreed to sell to the underwriters named below, and each underwriter severally has agreed to purchase from us, the respective number of securities set forth opposite its name below:

---

| | | |
|:---|:---|:---|
| **Underwriters** | **Number of Shares** | **Number of**<br> **Prefunded** <br> **Warrants** |
| Lake Street Capital Markets LLC |  |  |
| **Total** |  |  |

---

The underwriting agreement provides that the obligation of the underwriters to purchase the shares of Common Stock and Prefunded Warrants offered by this prospectus is subject to certain conditions. The underwriters are obligated to purchase all of the shares of Common Stock and all the Prefunded Warrants offered hereby if any of the shares or Prefunded Warrants are purchased.

Certain of our existing stockholders, officers, and directors plan to participate in this offering on the same terms as other investors.

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We have granted the underwriters an option to purchase up to an additional shares of Common Stock from us at the public offering price, less the underwriting discounts and commissions. The underwriters may exercise this option at any time and from time to time, in whole or in part, during the 30-day period after the date of this prospectus.

**Discounts, Commissions and Expenses**

The underwriters propose to offer the securities we are offering pursuant to the underwriting agreement to the public at the public offering price set forth on the cover page of this prospectus and to certain dealers at that price (less a concession) not in excess of $ per share of Common Stock or $ per Prefunded Warrant. After this offering, the public offering price and concession may be changed by the Representative. No such change shall change the amount of proceeds to be received by us as set forth on the cover page of this prospectus.

In connection with the sale of the securities to be purchased by the underwriters, the underwriters will be deemed to have received compensation in the form of underwriting commissions and discounts. The underwriters' commissions and discounts will be 7.0% of the gross proceeds of this offering, or $ per share of Common Stock and $ per Prefunded Warrant.

We have also agreed to reimburse the Representative for certain out-of-pocket expenses actually incurred, including legal fees and disbursements or any legal counsel, in an aggregate amount not to exceed $125,000.

The following table shows the underwriting discounts and commissions payable to the underwriters by us in connection with this offering (assuming (i) both the exercise and non-exercise of the underwriters' option to purchase additional shares of Common Stock we have granted to the underwriters, and (ii) that no Prefunded Warrants have been issued in this offering):

---

| | | | |
|:---|:---|:---|:---|
|  | **Per Share** | **Total** | **Total** |
|  |  | **No Exercise** | **Full Exercise** |
| Public offering price | $| $| $|
| Underwriting discounts and commissions paid by us | $| $| $|

---

**Indemnification**

Pursuant to the underwriting agreement, we have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act, or to contribute to payments that the underwriters or such other indemnified parties may be required to make in respect of those liabilities.

**Lock-Up Agreements**

We have agreed not to (i) offer, pledge, issue, sell, contract to sell, purchase, contract to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of our Common Stock or any securities convertible into or exercisable or exchangeable for our Common Stock; (ii) enter into any swap or other arrangement that transfers, in whole or in part, any of the economic consequences of ownership of shares of Common Stock; or (iii) file any registration statement with the SEC relating to the offering of any shares of our Common Stock or any securities convertible into or exercisable or exchangeable for shares of our Common Stock, except for registration statements on Form S-8, without the prior written consent of the Representative for a period of 90 days following the date of this prospectus (the "Lock-up Period"). This consent may be given at any time without public notice. These restrictions on future issuances are subject to exceptions for (i) the issuance of shares of our Common Stock sold in this offering, (ii) the issuance of shares of our Common Stock upon the exercise of outstanding options or warrants, the vesting of restricted stock awards or units, or the conversion of outstanding convertible securities, (iii) the issuance of employee stock options and the grant of restricted stock awards or restricted stock units or shares of Common Stock pursuant to existing equity incentive plans and (iv) the issuance of equity securities in connection with bona fide mergers or acquisitions, joint ventures, commercial relationships or other strategic transactions provided that the aggregate number of shares of Common Stock or convertible securities that the Company may sell or issue in connection therewith may not exceed 5% of the total number of issued and outstanding shares of Common Stock immediately following this offering, and provided further that any recipients sign a lock-up agreement on the same terms as the Company's directors, officers, and stockholders.

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In addition, each of our directors, executive officers and certain of our stockholders has entered into a lock-up agreement with the underwriters. Under the lock-up agreements, the directors, executive officers and certain of our stockholders may not, directly or indirectly, sell, assign, transfer, swap, offer to sell, contract to sell, or grant any option for the sale (including any short sale), grant any security interest in, pledge, hypothecate, hedge, establish an open "put equivalent position" (within the meaning of Rule 16a-1(h) under the Exchange Act), or otherwise dispose of, or enter into any transaction which is designed to or could be expected to result in the disposition of, any shares of our Common Stock or securities convertible into or exchangeable for shares of our Common Stock, or publicly announce any intention to do any of the foregoing, without the prior written consent of the Representative, for a period of 90 days from the closing date of this offering with certain limited exceptions. This consent may be given at any time without public notice. These restrictions on future dispositions by our directors, executive officers and certain of our stockholders are subject to exceptions for transfers (i) as a bona fide gift or gifts, (ii) by operation of law, including pursuant to a qualified domestic relations order or divorce settlement, (iii) to immediate family members, (iv) to any trust for the direct or indirect benefit of the director, officer or stockholder or his, her, or its immediate family, (v) to any beneficiary pursuant to a will or other testamentary document or applicable laws of descent, or (vi) to any corporation, partnership, limited liability company or other entity all of the beneficial ownership interests of which are held by the director, officer or stockholder or his, her, or its immediate family; provided that, (x) prior to each of the foregoing transfers, the Representative shall have received an executed lock-up agreement from the donee, trustee, distributee or transferee, as applicable, (y) no such transfer may involve a disposition for value, and (z) the transfers (other than under clauses (ii) and (v) above) is not required to be reported as a reduction in beneficial ownership in any public report, announcement, or filing made or to be made with the SEC during the lock-up period, and the officer, director, or stockholder does not otherwise voluntarily report such transfer. Each officer, director and stockholder shall be immediately and automatically released from all restrictions and obligations under the lock up agreement in the event that he or she ceases to be a director, officer or stockholder of our company and has no further reporting obligations under Section 16 of the Exchange Act.

**Electronic Distribution**

This prospectus may be made available in electronic format on websites or through other online services maintained by the underwriters or by their affiliates. In those cases, prospective investors may view offering terms online and prospective investors may be allowed to place orders online. Other than this prospectus in electronic format, the information on the underwriters' websites or our website and any information contained in any other websites maintained by the underwriters or by us is not part of this prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or the underwriter in its capacity as underwriter, and should not be relied upon by investors.

**Determination of Offering Price**

The actual offering price of the Securities were negotiated between us, the underwriter and the investors in the offering based on the trading of our shares of Common Stock prior to the offering, among other things. Other factors considered in determining the public offering price of the securities we are offering, include our history and prospects, the stage of development of our business, our business plans for the future and the extent to which they have been implemented, an assessment of our management, the general conditions of the securities markets at the time of the offering and such other factors as were deemed relevant.

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**Transfer Agent and Registrar**

The transfer agent and registrar for our Common Stock is Direct Transfer, LLC, whose address is One Glenwood Avenue, Suite 1001, Raleigh, North Carolina 27603.

**Listing**

Our Common Stock is traded on Nasdaq under the symbol "AYTU."

**Price Stabilization, Short Positions and Penalty Bids**

In connection with the offering, the underwriters may engage in stabilizing transactions, short sales and syndicate covering transactions and penalty bids in accordance with Regulation M under the Exchange Act:

● Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum.

● Short positions involve sales by the underwriters of shares in excess of the number of shares the underwriters are obligated to purchase, which creates a syndicate short position. A short position may be either a covered short position or a naked short position. In a covered short position, the number of shares involved in the sales made by the underwriter in excess of the number of shares it is obligated to purchase is not greater than the number of shares that they may purchase by exercising its option to purchase additional shares. If the underwriters sell shares in excess of the number of shares the underwriters are entitled to purchase by exercising their option to purchase additional shares and, therefore, have a naked short position, the position can be closed out only by buying shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there could be downward pressure on the price of the shares in the open market after pricing that could adversely affect investors who purchase in the offering.

● Syndicate covering transactions involve purchases of the Common Stock in the open market after the distribution has been completed in order to cover syndicate short positions. In determining the source of shares to close out the short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through their options to purchase additional shares. The underwriters may close out any covered short position by either exercising their options to purchase additional shares and/or purchasing shares in the open market. A naked short position can only be closed out by buying shares in the open market.

● Penalty bids permit the underwriters to reclaim a selling concession from a syndicate member when the Common Stock originally sold by the syndicate member is purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions.

These stabilizing transactions, syndicate covering transactions and penalty bids may have the effect of raising or maintaining the market price of our Common Stock or preventing or retarding a decline in the market price of the Common Stock. As a result, the price of our Common Stock may be higher than the price that might otherwise exist in the open market. These transactions may be discontinued at any time.

Neither we nor the underwriters make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of our shares of Common Stock. In addition, neither we nor the underwriters make any representation that the underwriters will engage in these transactions or that any transaction, if commenced, will not be discontinued without notice.

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**Offer Restrictions Outside the United States**

Other than in the United States, no action has been taken by us or the underwriter that would permit a public offering of the securities offered by this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to this offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.

**Australia**

This prospectus is not a disclosure document under Chapter 6D of the Australian Corporations Act, has not been lodged with the Australian Securities and Investments Commission and does not purport to include the information required of a disclosure document under Chapter 6D of the Australian Corporations Act. Accordingly, (i) the offer of the securities under this prospectus is only made to persons to whom it is lawful to offer the securities without disclosure under Chapter 6D of the Australian Corporations Act under one or more exemptions set out in section 708 of the Australian Corporations Act, (ii) this prospectus is made available in Australia only to those persons as set forth in clause (i) above, and (iii) the offeree must be sent a notice stating in substance that by accepting this offer, the offeree represents that the offeree is such a person as set forth in clause (i) above, and, unless permitted under the Australian Corporations Act, agrees not to sell or offer for sale within Australia any of the securities sold to the offeree within 12 months after its transfer to the offeree under this prospectus.

**Canada**

The securities may be sold in Canada only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the securities must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable securities laws. Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus (including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser's province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser's province or territory for particulars of these rights or consult with a legal advisor. Pursuant to section 3A.3 of National Instrument 33-105 Underwriting Conflicts (NI 33-105), the underwriter is not required to comply with the disclosure requirements of NI33-105 regarding underwriter conflicts of interest in connection with this offering.

**China**

The information in this document does not constitute a public offer of the securities, whether by way of sale or subscription, in the People's Republic of China (excluding, for purposes of this paragraph, Hong Kong Special Administrative Region, Macau Special Administrative Region and Taiwan). The securities may not be offered or sold directly or indirectly in the PRC to legal or natural persons other than directly to "qualified domestic institutional investors."

**European Economic Area - Belgium, Germany, Luxembourg and Netherlands**

The information in this document has been prepared on the basis that all offers of securities will be made pursuant to an exemption under the Directive 2003/71/EC ("Prospectus Directive"), as implemented in Member States of the European Economic Area (each, a "Relevant Member State"), from the requirement to produce a prospectus for offers of securities.

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An offer to the public of securities has not been made, and may not be made, in a Relevant Member State except pursuant to one of the following exemptions under the Prospectus Directive as implemented in that Relevant Member State:

● to legal entities that are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities;

● to any legal entity that has two or more of (i) an average of at least 250 employees during its last fiscal year; (ii) a total balance sheet of more than €43,000,000 (as shown on its last annual unconsolidated or consolidated financial statements) and (iii) an annual net turnover of more than €50,000,000 (as shown on its last annual unconsolidated or consolidated financial statements);

● to fewer than 100 natural or legal persons (other than qualified investors within the meaning of Article 2(1)(e) of the Prospectus Directive) subject to obtaining our prior consent or any underwriter for any such offer; or

● in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of securities shall require us to publish a prospectus pursuant to Article 3 of the Prospectus Directive.

**France**

This document is not being distributed in the context of a public offering of financial securities (offre au public de titres financiers) in France within the meaning of Article L.411-1 of the French Monetary and Financial Code (Code monétaire et financier) and Articles 211-1 et seq. of the General Regulation of the French Autorité des marchés financiers ("AMF"). The securities have not been offered or sold and will not be offered or sold, directly or indirectly, to the public in France.

This document and any other offering material relating to the securities have not been, and will not be, submitted to the AMF for approval in France and, accordingly, may not be distributed or caused to distributed, directly or indirectly, to the public in France.

Such offers, sales and distributions have been and shall only be made in France to (i) qualified investors (investisseurs qualifiés) acting for their own account, as defined in and in accordance with Articles L.411-2-II-2 and D.411-1 to D.411-3, D. 744-1, D.754-1 and D.764-1 of the French Monetary and Financial Code and any implementing regulation and/or (ii) a restricted number of non-qualified investors (cercle restreint d'investisseurs) acting for their own account, as defined in and in accordance with Articles L.411-2-II-2° and D.411-4, D.744-1, D.754-1 and D.764-1 of the French Monetary and Financial Code and any implementing regulation.

Pursuant to Article 211-3 of the General Regulation of the AMF, investors in France are informed that the securities cannot be distributed (directly or indirectly) to the public by the investors otherwise than in accordance with Articles L.411-1, L.411-2, L.412-1 and L.621-8 to L.621-8-3 of the French Monetary and Financial Code.

**Ireland**

The information in this document does not constitute a prospectus under any Irish laws or regulations and this document has not been filed with or approved by any Irish regulatory authority as the information has not been prepared in the context of a public offering of securities in Ireland within the meaning of the Irish Prospectus (Directive 2003/71/EC) Regulations 2005 (the "Prospectus Regulations"). The securities have not been offered or sold, and will not be offered, sold or delivered directly or indirectly in Ireland by way of a public offering, except to (i) qualified investors as defined in Regulation 2(l) of the Prospectus Regulations and (ii) fewer than 100 natural or legal persons who are not qualified investors.

**Israel**

The securities offered by this prospectus have not been approved or disapproved by the Israeli Securities Authority (the ISA), or ISA, nor have such securities been registered for sale in Israel. The shares may not be offered or sold, directly or indirectly, to the public in Israel, absent the publication of a prospectus. The ISA has not issued permits, approvals or licenses in connection with this offering or publishing the prospectus; nor has it authenticated the details included herein, confirmed their reliability or completeness, or rendered an opinion as to the quality of the securities being offered. Any resale in Israel, directly or indirectly, to the public of the securities offered by this prospectus is subject to restrictions on transferability and must be effected only in compliance with the Israeli securities laws and regulations.

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**Italy**

The offering of the securities in the Republic of Italy has not been authorized by the Italian Securities and Exchange Commission (Commissione Nazionale per le Società e la Borsa, "CONSOB" pursuant to the Italian securities legislation and, accordingly, no offering material relating to the securities may be distributed in Italy and such securities may not be offered or sold in Italy in a public offer within the meaning of Article 1.1(t) of Legislative Decree No. 58 of 24 February 1998 ("Decree No. 58"), other than:

● to Italian qualified investors, as defined in Article 100 of Decree no. 58 by reference to Article 34-ter of CONSOB Regulation no. 11971 of 14 May 1999 ("Regulation no. 1197l") as amended ("Qualified Investors"); and

● in other circumstances that are exempt from the rules on public offer pursuant to Article 100 of Decree No. 58 and Article 34-ter of Regulation No. 11971 as amended.

Any offer, sale or delivery of the securities or distribution of any offer document relating to the securities in Italy (excluding placements where a Qualified Investor solicits an offer from the issuer) under the paragraphs above must be:

● made by investment firms, banks or financial intermediaries permitted to conduct such activities in Italy in accordance with Legislative Decree No. 385 of 1 September 1993 (as amended), Decree No. 58, CONSOB Regulation No. 16190 of 29 October 2007 and any other applicable laws; and

● in compliance with all relevant Italian securities, tax and exchange controls and any other applicable laws.

Any subsequent distribution of the securities in Italy must be made in compliance with the public offer and prospectus requirement rules provided under Decree No. 58 and the Regulation No. 11971 as amended, unless an exception from those rules applies. Failure to comply with such rules may result in the sale of such securities being declared null and void and in the liability of the entity transferring the securities for any damages suffered by the investors.

**Japan**

The securities have not been and will not be registered under Article 4, paragraph 1 of the Financial Instruments and Exchange Law of Japan (Law No. 25 of 1948), as amended (the "FIEL") pursuant to an exemption from the registration requirements applicable to a private placement of securities to Qualified Institutional Investors (as defined in and in accordance with Article 2, paragraph 3 of the FIEL and the regulations promulgated thereunder). Accordingly, the securities may not be offered or sold, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan other than Qualified Institutional Investors. Any Qualified Institutional Investor who acquires securities may not resell them to any person in Japan that is not a Qualified Institutional Investor, and acquisition by any such person of securities is conditional upon the execution of an agreement to that effect.

**New Zealand**

The shares of Common Stock offered hereby have not been offered or sold, and will not be offered or sold, directly or indirectly in New Zealand and no offering materials or advertisements have been or will be distributed in relation to any offer of shares in New Zealand, in each case other than:

● to persons whose principal business is the investment of money or who, in the course of and for the purposes of their business, habitually invest money;

● to persons who in all the circumstances can properly be regarded as having been selected otherwise than as members of the public;

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● to persons who are each required to pay a minimum subscription price of at least NZ$500,000 for the shares before the allotment of those shares (disregarding any amounts payable, or paid, out of money lent by the issuer or any associated person of the issuer); or

● in other circumstances where there is no contravention of the Securities Act 1978 of New Zealand (or any statutory modification or reenactment of, or statutory substitution for, the Securities Act 1978 of New Zealand).

**Portugal**

This document is not being distributed in the context of a public offer of financial securities (oferta pública de valores mobiliários) in Portugal, within the meaning of Article 109 of the Portuguese Securities Code (Código dos Valores Mobiliários). The securities have not been offered or sold and will not be offered or sold, directly or indirectly, to the public in Portugal. This document and any other offering material relating to the securities have not been, and will not be, submitted to the Portuguese Securities Market Commission (Comissăo do Mercado de Valores Mobiliários) for approval in Portugal and, accordingly, may not be distributed or caused to distributed, directly or indirectly, to the public in Portugal, other than under circumstances that are deemed not to qualify as a public offer under the Portuguese Securities Code. Such offers, sales and distributions of securities in Portugal are limited to persons who are "qualified investors" (as defined in the Portuguese Securities Code). Only such investors may receive this document and they may not distribute it or the information contained in it to any other person.

**Sweden**

This document has not been, and will not be, registered with or approved by Finansinspektionen (the Swedish Financial Supervisory Authority). Accordingly, this document may not be made available, nor may the securities be offered for sale in Sweden, other than under circumstances that are deemed not to require a prospectus under the Swedish Financial Instruments Trading Act (1991:980) (Sw. lag (1991:980) om handel med finansiella instrument). Any offering of securities in Sweden is limited to persons who are "qualified investors" (as defined in the Financial Instruments Trading Act). Only such investors may receive this document and they may not distribute it or the information contained in it to any other person.

**Switzerland**

The securities may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange ("SIX") or on any other stock exchange or regulated trading facility in Switzerland. This document has been prepared without regard to the disclosure standards for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in Switzerland. Neither this document nor any other offering material relating to the securities may be publicly distributed or otherwise made publicly available in Switzerland.

Neither this document nor any other offering material relating to the securities have been or will be filed with or approved by any Swiss regulatory authority. In particular, this document will not be filed with, and the offer of securities will not be supervised by, the Swiss Financial Market Supervisory Authority (FINMA).

This document is personal to the recipient only and not for general circulation in Switzerland.

**United Arab Emirates**

Neither this document nor the securities have been approved, disapproved or passed on in any way by the Central Bank of the United Arab Emirates or any other governmental authority in the United Arab Emirates, nor have we received authorization or licensing from the Central Bank of the United Arab Emirates or any other governmental authority in the United Arab Emirates to market or sell the securities within the United Arab Emirates. This document does not constitute and may not be used for the purpose of an offer or invitation. We may not render services relating to the securities within the United Arab Emirates, including the receipt of applications and/or the allotment or redemption of such shares.

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No offer or invitation to subscribe for securities is valid or permitted in the Dubai International Financial Centre.

**United Kingdom**

Neither the information in this document nor any other document relating to the offer has been delivered for approval to the Financial Services Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Services and Markets Act 2000, as amended (the "FSMA")) has been published or is intended to be published in respect of the securities. This document is issued on a confidential basis to "qualified investors" (within the meaning of section 86(7) of FSMA) in the United Kingdom, and the securities may not be offered or sold in the United Kingdom by means of this document, any accompanying letter or any other document, except in circumstances which do not require the publication of a prospectus pursuant to section 86(1) FSMA. This document should not be distributed, published or reproduced, in whole or in part, nor may its contents be disclosed by recipients to any other person in the United Kingdom.

Any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) received in connection with the issue or sale of the securities has only been communicated or caused to be communicated and will only be communicated or caused to be communicated in the United Kingdom in circumstances in which section 21(1) of FSMA does not apply us.

In the United Kingdom, this document is being distributed only to, and is directed at, persons (i) who have professional experience in matters relating to investments falling within Article 19(5) (investment professionals) of the Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 ("FPO"), (ii) who fall within the categories of persons referred to in Article 49(2)(a) to (d) (high net worth companies, unincorporated associations, etc.) of the FPO or (iii) to whom it may otherwise be lawfully communicated (together "relevant persons"). The investments to which this document relates are available only to, and any invitation, offer or agreement to purchase will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.

**CERTAIN MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS FOR NON-U.S. HOLDERS**

The following is a discussion of certain material U.S. federal income tax considerations applicable to a non-U.S. holder (as defined below) arising from and relating to the acquisition, ownership and disposition of our Common Stock acquired pursuant to this offering, the acquisition, ownership and disposition of Prefunded Warrants acquired pursuant to this offering, and the acquisition, ownership and disposition of Warrant Shares received upon exercise of the Prefunded Warrants. This summary is for general information purposes only and does not purport to be a complete analysis or listing of all potential U.S. federal income tax considerations that may apply to a non-U.S. holder arising from or relating to the acquisition, ownership and disposition of our Common Stock, Prefunded Warrants or Warrant Shares. In addition, this summary does not take into account the individual facts and circumstances of any particular non-U.S. holder that may affect the U.S. federal income tax consequences to such non-U.S. holder, including, without limitation, specific tax consequences to a non-U.S. holder under an applicable income tax treaty. Accordingly, this summary is not intended to be, and should not be construed as, legal or U.S. federal income tax advice with respect to any particular non-U.S. holder. This summary does not address the U.S. federal alternative minimum tax, U.S. federal net investment income tax, U.S. federal estate and gift tax, U.S. state and local tax, or non-U.S. tax consequences to non-U.S. holders of the acquisition, ownership and disposition of our Common Stock, Prefunded Warrants or Warrant Shares. In addition, except as specifically set forth below, this summary does not discuss applicable income tax reporting requirements. Each prospective non-U.S. holder should consult his, her or its own tax advisors regarding the U.S. federal, state, local, and non-U.S. tax consequences relating to the acquisition, ownership and disposition of our Common Stock, Prefunded Warrants and Warrant Shares.

No ruling from the Internal Revenue Service (the "IRS") has been requested, or will be obtained, regarding the U.S. federal income tax consequences to a non-U.S. holder of the acquisition, ownership and disposition of our Common Stock, Prefunded Warrants or Warrant Shares. This summary is not binding on the IRS, and the IRS is not precluded from taking a position that is different from, or contrary to, the positions taken in this summary. In addition, because the authorities on which this summary is based are subject to various interpretations, the IRS and the U.S. courts could disagree with one or more of the conclusions described in this summary. There can be no assurance that the IRS will not challenge one or more of the tax consequences described in this summary.

This discussion is based on current provisions of the IRC, existing and proposed U.S. Treasury Regulations promulgated thereunder, current administrative rulings and judicial decisions, all as in effect as of the date of this prospectus supplement and all of which are subject to change or to differing interpretation, possibly with retroactive effect. Any change or differing interpretation could alter the tax consequences to non-U.S. holders described in this prospectus supplement. This summary does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation that, if enacted, could be applied on a retroactive or prospective basis.

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For purposes of this discussion, the term "non-U.S. holder" means a beneficial owner (other than a partnership or other pass-through entity) of our Common Stock, Prefunded Warrants or Warrant Shares, as applicable, that is not, for U.S. federal income tax purposes:

● an individual who is a citizen or resident of the United States;

● a corporation, or other entity treated as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States, any state thereof, or the District of Columbia;

● an estate the income of which is subject to U.S. federal income taxation regardless of its source; or

● a trust if (1) a U.S. court is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have authority to control all substantial decisions of the trust or (2) the trust has a valid election in effect under applicable U.S. Treasury Regulations to be treated as a U.S. person.

This discussion assumes that each non-U.S. holder holds our Common Stock, Prefunded Warrants or Warrant Shares, as applicable, as a capital asset (generally, property held for investment) within the meaning of Section 1221 of the IRC. This discussion does not consider any specific facts or circumstances that may apply to a non-U.S. holder and does not address the special tax rules applicable to particular non-U.S. holders, such as:

● banks, insurance companies or other financial institutions;

● brokers or dealers in securities;

● tax-exempt organizations and tax-qualified retirement plans;

● pension plans, including "qualified foreign pension funds" as defined in Section 897(l)(2) of the IRC and entities all of the interests of which are held by qualified foreign pension funds;

● persons deemed to sell our Common Stock, Prefunded Warrants or Warrant Shares under the constructive sale provisions of the IRC;

● persons who acquire our Common Stock, Prefunded Warrants or Warrant Shares, as applicable, pursuant to the exercise of employee stock options or otherwise as compensation for their services;

● owners that hold our Common Stock, Prefunded Warrants or Warrant Shares as part of a straddle, hedge, conversion transaction, synthetic security or other integrated investment or who have elected to mark securities to market;

● controlled foreign corporations, passive foreign investment companies, and corporations that accumulate earnings to avoid U.S. federal income tax, and shareholders therein;

● corporations organized outside the United States, any state thereof or the District of Columbia that are nonetheless treated as U.S. taxpayers for U.S. federal income tax purposes;

● non-U.S. governments;

● persons subject to special tax accounting rules;

● persons that own, or are deemed to own, more than five percent (by voting power or value) of our Common Stock, Prefunded Warrants and/or Warrant Shares (other than as expressly provided below);

● real estate investment trusts or regulated investment companies; and

● certain U.S. expatriates, former citizens and former long-term residents of the United States.

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This discussion also does not address the tax treatment of entities or arrangements classified as partnerships or other entities that are pass-through entities for U.S. federal income tax purposes or persons who hold our Common Stock, Prefunded Warrants or Warrant Shares through partnerships or such other pass-through entities. The tax treatment of partners of such partnerships or owners of such pass-through entities generally will depend upon the status of each partner or owner and the activities of the applicable partnership or other pass-through entity. Partnerships and other pass-through entities that will hold shares of our Common Stock, Prefunded Warrants or Warrant Shares, and the partners in such partnerships and other pass-through entities should consult their own tax advisors regarding the tax consequences of the acquisition, ownership and disposition of our Common Stock, Prefunded Warrants or Warrant Shares.

**THIS DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT, AND IS NOT INTENDED TO BE, LEGAL OR TAX ADVICE. PROSPECTIVE INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE U.S. FEDERAL, STATE, LOCAL, AND NON-U.S. INCOME, ESTATE AND OTHER TAX CONSIDERATIONS OF ACQUIRING, HOLDING AND DISPOSING OF OUR COMMON STOCK, PREFUNDED WARRANTS AND WARRANT SHARES.**

***Treatment of Prefunded Warrants***

Although it is not entirely free from doubt, a Prefunded Warrant should be treated as a share of a separate class of our common stock for U.S. federal income tax purposes and a holder of Prefunded Warrants should generally be taxed in the same manner as a holder of our Common Stock as described below. Accordingly, no gain or loss should be recognized upon the exercise of a Prefunded Warrant and, upon exercise, the holding period of a Warrant Share received upon exercise of a Prefunded Warrant should generally include the holding period of such Prefunded Warrant. Similarly, the tax basis of the Prefunded Warrant should carry over to the Warrant Share received upon exercise increased by the exercise price of $0.0001. However, such characterization is not binding on the IRS, and the IRS may treat the Prefunded Warrants as warrants to acquire our Common Stock. Each non-U.S. holder should consult his, her or its own tax advisor regarding the risks associated with the acquisition of a Prefunded Warrant pursuant to this offering (including potential alternative characterizations). The balance of this discussion generally assumes that the characterization described above is respected for U.S. federal income tax purposes.

In certain limited circumstances, a non-U.S. holder may be permitted to undertake a cashless exercise of Prefunded Warrants into Warrant Shares. The U.S. federal income tax treatment of a cashless exercise of Prefunded Warrants into Warrant Shares is unclear, and the tax consequences of a cashless exercise could differ from the consequences upon the exercise of a Prefunded Warrant described in the preceding paragraph. Non-U.S. holders should consult their own tax advisors regarding the U.S. federal income tax consequences of a cashless exercise of Prefunded Warrants.

***U.S. Federal Income Tax Consequences to Non-U.S. Holders of the Acquisition, Ownership and Disposition of our Common Stock, Prefunded Warrants and Warrant Shares***

**Distributions**

If we make distributions in respect of our Common Stock, Prefunded Warrants or Warrant Shares, those distributions generally will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. If a distribution exceeds our current and accumulated earnings and profits, the excess will be treated as a tax-free return of the non-U.S. holder's capital, up to the non-U.S. holder's tax basis in our Common Stock, Prefunded Warrants or Warrant Shares, as applicable (and will reduce the non-U.S. holder's basis in our Common Stock, Prefunded Warrants or Warrant Shares, but not below zero). Any remaining excess will be treated as capital gain, subject to the tax treatment described below under the heading "Gain on Sale, Exchange or Other Taxable Disposition of our Common Stock, Prefunded Warrants, or Warrant Shares." Any dividends paid to a non-U.S. holder with respect to our Common Stock, Prefunded Warrants or Warrant Shares generally will be subject to withholding tax at a 30% gross rate, subject to any exemption or lower rate under an applicable tax treaty if the non-U.S. holder provides the applicable withholding agent with a properly executed IRS Form W-8BEN or W-8BEN-E, unless the non-U.S. holder provides the applicable withholding agent with a properly executed IRS Form W-8ECI (or other applicable form) relating to income effectively connected with the conduct of a trade or business within the United States. If we are unable to determine, at the time of payment of a distribution, whether the distribution will constitute a dividend, we may nonetheless choose to withhold any U.S. federal income tax on the distribution as permitted by U.S. Treasury Regulations. If we are a USRPHC (as defined below) and we do not qualify for the Regularly Traded Exception (as defined below), distributions which constitute a return of capital will be subject to withholding tax unless an application for a withholding certificate is filed to reduce or eliminate such withholding.

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Dividends that are effectively connected with the conduct of a trade or business within the United States and includible in the non-U.S. holder's gross income are not subject to the withholding tax (assuming proper certification as described above), but instead are subject to U.S. federal income tax on a net income basis at applicable graduated individual or corporate rates. Any such effectively connected income received by a non-U.S. corporation may, under certain circumstances, be subject to an additional branch profits tax at a 30% rate, subject to any exemption or lower rate as may be specified by an applicable income tax treaty.

A non-U.S. holder of our Common Stock, Prefunded Warrants or Warrant Shares who wishes to claim the benefit of an applicable treaty rate or exemption is required to satisfy certain certification and other requirements. If a non-U.S. holder is eligible for an exemption from or a reduced rate of U.S. withholding tax pursuant to an income tax treaty, it may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS.

***Gain on Sale, Exchange or Other Taxable Disposition of our Common Stock, Prefunded Warrants, or Warrant Shares***

A non-U.S. holder generally will not be subject to U.S. federal income tax on any gain realized upon such non-U.S. holder's sale, exchange or other disposition of our Common Stock, Prefunded Warrants or Warrant Shares unless:

● the gain is effectively connected with a U.S. trade or business carried on by the non-U.S. holder (and, where an income tax treaty applies, is attributable to a U.S. permanent establishment of the non-U.S. holder), in which case the non-U.S. holder will be subject to tax on the net gain from the sale at regular graduated U.S. federal income tax rates, and if the non-U.S. holder is a corporation, may be subject to an additional U.S. branch profits tax at a gross rate equal to 30% of its effectively connected earnings and profits for that taxable year, subject to any exemption or lower rate as may be specified by an applicable income tax treaty;

● the non-U.S. holder is an individual who is present in the U.S. for 183 days or more in the taxable year of disposition (as such days are calculated for U.S. federal income tax purposes) and certain other conditions are met, in which case the non-U.S. holder will be subject to a 30% tax on the gain from the sale, which may be offset by U.S. source capital losses; or

● we are or have been a "United States real property holding corporation" ("USRPHC") for U.S. federal income tax purposes at any time during the shorter of the non-U.S. holder's holding period or the five-year period ending on the date of disposition of our Common Stock, Prefunded Warrants or Warrant Shares, as applicable. Even if we become a USRPHC, however, as long as our Common Stock is regularly traded on an established securities market as determined under applicable Treasury Regulations (the "Regularly Traded Exception"), our Common Stock (including the Warrant Shares) will be treated as a U.S. real property interest only if a non-U.S. holder actually (directly or indirectly) or constructively under certain attribution rules holds or has held more than five percent of such regularly traded Common Stock (including the Warrant Shares) at any time during the shorter of the five-year period preceding such non-U.S. holder's disposition of, or holding period for, our Common Stock (including the Warrant Shares) (a "5% Shareholder"). However, no assurance can be provided that our Common Stock (including the Warrant Shares) will be considered to be regularly traded on an established securities market for purposes of the rules described above. Special rules may apply to non-U.S. holders of Prefunded Warrants, who should consult their own tax advisors. Although there can be no assurance, we believe that we are not currently, and we do not anticipate becoming, a USRPHC for U.S. federal income tax purposes. No assurance can be provided that our Common Stock will be regularly traded on an established securities market for purposes of the rule described above. Accordingly, we can provide no assurances that our Common Stock, Prefunded Warrants or Warrant Shares will meet the Regularly Traded Exception at the time a non-U.S. holder purchases such securities or sells, exchanges or otherwise disposes of such securities. If we are determined to be a USRPHC and the foregoing exception does not apply, then the non-U.S. holder generally will be taxed on its net gain derived from the disposition at the U.S. federal income tax rates applicable to U.S. persons (as defined in the IRC). The determination of whether a non-U.S. holder is a 5% Shareholder and the potential application of the Regularly Traded Exception is complex and subject to uncertainty. Non-U.S. holders should consult with their own tax advisors regarding such determinations and the consequences of these rules on their investment.

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**Information Reporting and Backup Withholding**

Backup withholding, currently at a rate of 24%, generally will not apply to dividends paid to a non-U.S. holder on our Common Stock, Prefunded Warrants or Warrant Shares, or to the gross proceeds paid to a non-U.S. holder from a disposition of, our Common Stock, Prefunded Warrants or Warrant Shares, provided that the non-U.S. holder furnishes the required certification for its non-U.S. status, such as by providing a valid IRS Form W-8BEN, IRS Form W-8BEN-E, IRS Form W-8ECI, or certain other requirements are met. Backup withholding may apply if the payor has actual knowledge, or reason to know, that the holder is a United States person who is not an exempt recipient.

We are required to report annually to the IRS the amount of any dividends paid to a non-U.S. holder, regardless of whether we actually withheld any tax. Copies of the information returns reporting such dividends and the amount withheld may also be made available to the tax authorities in the country in which the non-U.S. holder resides under the provisions of an income tax treaty or other agreement between the United States and the tax authorities in such country. In addition, proceeds from the disposition by a non-U.S. holder of our Common Stock, Prefunded Warrants or Warrant Shares that is transacted within the United States or conducted through certain United States-related brokers generally will be subject to backup withholding or information reporting unless the applicable withholding agent receives the certification described above and does not have actual knowledge or reason to know that such holder is a United States person, or the holder otherwise establishes an exemption. Proceeds of a disposition of our Common Stock, Prefunded Warrants or Warrant Shares conducted through a non-U.S. office of a non-U.S. broker generally will not be subject to backup withholding or information reporting.

Backup withholding is not an additional tax. The United States federal income tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If backup withholding results in an overpayment of taxes, a refund or credit may generally be obtained from the IRS, provided that the required information is timely furnished to the IRS.

**FATCA**

Withholding taxes may be imposed under Sections 1471 to 1474 of the IRC (such sections commonly referred to as the Foreign Account Tax Compliance Act, or "FATCA") on certain types of payments made to non-U.S. financial institutions and certain other non-U.S. entities. Specifically, a 30% withholding tax may be imposed on dividends (including constructive dividends) on, or, subject to the proposed U.S. Treasury Regulations discussed below, gross proceeds from the disposition of, our Common Stock, Prefunded Warrants or Warrant Shares paid to or through a "foreign financial institution" or a "non-financial foreign entity" (each as defined in the IRC), unless (i) the foreign financial institution undertakes certain diligence and reporting obligations, (ii) the non-financial foreign entity either certifies it does not have any "substantial United States owners" (as defined in the IRC) or furnishes identifying information regarding each substantial United States owner, or (iii) the foreign financial institution or non-financial foreign entity otherwise qualifies for an exemption from these rules. If the payee is a foreign financial institution and is subject to the diligence and reporting requirements in clause (i) above, it must enter into an agreement with the United States Department of Treasury requiring, among other things, that it undertake to identify accounts held by certain "specified United States persons" or "United States owned foreign entities" (each as defined in the IRC), annually report certain information about such accounts, and withhold 30% on certain payments to non-compliant foreign financial institutions and certain other account holders. Non-U.S. holders typically will be required to furnish certifications (generally on the applicable IRS Form W-8) or other documentation to provide the information required by FATCA or to establish compliance with or an exemption from withholding under FATCA. FATCA withholding may apply where payments are made through a non-U.S. intermediary that is not FATCA compliant, even where the non-U.S. holder satisfies the holder's own FATCA obligations.

Under the applicable U.S. Treasury Regulations and administrative guidance, withholding under FATCA generally applies to payments of dividends (including constructive dividends) on our Common Stock, Prefunded Warrants or Warrant Shares, and subject to proposed U.S. Treasury Regulations described below, to payments of gross proceeds from the sale or other disposition of our Common Stock, Prefunded Warrants or Warrant Shares. The United States Department of Treasury has released proposed Treasury Regulations (the preamble to which specifies that taxpayers may rely on them pending finalization) which would eliminate FATCA withholding on payments of gross proceeds from the sale or other disposition of our Common Stock, Prefunded Warrants or Warrant Shares. There can be no assurance that the proposed U.S. Treasury Regulations will be finalized in their present form.

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The United States and a number of other jurisdictions have entered into intergovernmental agreements to facilitate the implementation of FATCA. Any applicable intergovernmental agreement may alter one or more of the FATCA information reporting and withholding requirements. Prospective investors should consult their own tax advisors regarding the potential application of withholding under FATCA to an investment in our Common Stock, Prefunded Warrants or Warrant Shares, including the applicability of any intergovernmental agreements.

The preceding discussion of material U.S. federal income tax considerations is for informational purposes only. It is not legal or tax advice. Prospective investors should consult their own tax advisors regarding the particular U.S. federal, state, local, and non-U.S. tax consequences of acquiring, holding and disposing of our Common Stock, Prefunded Warrants or Warrant Shares, including the consequences of any proposed changes in applicable laws.

**LEGAL MATTERS**

The validity of the issuance of the securities offered hereby will be passed upon for us by Dorsey & Whitney LLP of Denver, Colorado. Sullivan & Worcester of New York, New York is acting as counsel for Lake Street Capital Markets LLC in connection with certain legal matters related to this offering.

**EXPERTS**

The financial statements included in this prospectus and elsewhere in the registration statement have been so included in reliance upon the report of Grant Thornton LLP, independent registered public accountants, upon the authority of said firm as experts in accounting and auditing.

**WHERE YOU CAN FIND MORE INFORMATION**

We file annual, quarterly and other reports, proxy statements and other information with the SEC. Our SEC filings are available to the public over the Internet at the SEC's website at https://www.sec.gov. Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K, including any amendments to those reports, and other information that we file with or furnish to the SEC pursuant to Section 13(a) or 15(d) of the Exchange Act can also be accessed free of charge through the Internet. These filings will be available as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. You may also access these filings through our website at https://www.aytubio.com.

We have filed with the SEC a registration statement under the Securities Act relating to the offering of these securities. The registration statement, including the attached exhibits, contains additional relevant information about us and the securities. This prospectus does not contain all of the information set forth in the registration statement. You can obtain a copy of the registration statement, at prescribed rates, from the SEC at the address listed above. The registration statement, along with our most recent annual report on Form 10-K, subsequent reports on Form 10-Q and current reports on Form 8-K, as well as other filings that we make with the SEC, are also available on our Internet website, https://www.aytubio.com. We have not incorporated by reference into this prospectus the information on our website, and you should not consider it to be a part of this prospectus.

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**INCORPORATION BY REFERENCE**

We have elected to incorporate the following documents into this prospectus, together with all exhibits filed therewith or incorporated therein by reference, to the extent not otherwise amended or superseded by the contents of this prospectus (other than information furnished and not filed under Item 2.02 or Item 7.01 of any current reports on Form 8-K):

● our Annual Report on Form 10-K for the year ended [<u>June 30, 2024</u>](http://www.sec.gov/ix?doc=/Archives/edgar/data/0001385818/000143774924030062/aytu20240630_10k.htm), as filed with the SEC on September 26, 2024;

● our Quarterly Report on Form 10-Q for the three months ended [<u>September 30, 2024</u>](http://www.sec.gov/ix?doc=/Archives/edgar/data/0001385818/000143774924034970/aytu20240930_10q.htm), as filed with the SEC on November 13, 2024;

● our Quarterly Report on Form 10-Q for the three months ended [<u>December 31, 2024</u>](http://www.sec.gov/ix?doc=/Archives/edgar/data/0001385818/000143774925003568/aytu20241231c_10q.htm), as filed with the SEC on February 12, 2025;

● our Quarterly Report on Form 10-Q for the three months ended [March 31, 2025](http://www.sec.gov/ix?doc=/Archives/edgar/data/0001385818/000143774925016833/aytu20250331_10q.htm), as filed with the SEC on May 14, 2025;

● our Current Reports on Form 8-K filed with the SEC on [<u>November 13, 2024</u>](http://www.sec.gov/ix?doc=/Archives/edgar/data/0001385818/000143774924034898/aytu20240909_8k.htm), and [May 21, 2025](http://www.sec.gov/ix?doc=/Archives/edgar/data/0001385818/000143774925017989/aytu20250515_8k.htm);

● our definitive proxy statement on Schedule 14A, filed with the SEC on [<u>March 28, 2025</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774925009836/aytu20250213_def14a.htm); and

● The description of our Common Stock filed as Exhibit 4.9 to our Annual Report on Form 10-K (File No. 001-38247) for the fiscal year ended June 30, 2022, filed with the SEC on [<u>September 27, 2022</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022014652/aytu-20220630xex4d9.htm), including any amendments or reports filed for the purpose of updating such description.

In addition, we incorporate by reference in this prospectus any future filings we make with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act (excluding any information furnished and not filed with the SEC) after the date on which the registration statement that includes this prospectus was initially filed with the SEC (including all such documents we may file with the SEC after the date of the initial registration statement and prior to the effectiveness of the registration statement) and until all offerings under this prospectus are terminated.

Any statement contained in a document incorporated by reference herein shall be deemed to be modified or superseded for all purposes to the extent that a statement contained in this prospectus or in any other subsequently filed document which is also incorporated or deemed to be incorporated by reference, modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus. You may request a copy of these filings (other than an exhibit to a filing unless that exhibit is specifically incorporated by reference into that filing) at no cost by writing, telephoning or e-mailing us at the following address or telephone number:

Aytu BioPharma, Inc.

7900 East Union Avenue, Suite 920

Denver, Colorado 80237

(720) 437-6580

Attn: Ryan Selhorn

rselhorn@aytubio.com

Copies of these filings are also available through the "*Investors*" section of our website at https://www.aytubio.com. For other ways to obtain a copy of these filings, please refer to "*Where You Can Find More Information.*"

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 42

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**INDEX TO CONSOLIDATED FINANCIAL STATEMENTS**

---

| | |
|:---|:---|
| **Audited Consolidated Financial Statements** – **as of and for the Years Ended June 30, 2024, and 2023** | **Page** |
| [Report of Independent Registered Public Accounting Firm <u>(PCAOB ID 248)</u>](#report) | [F-2](#report) |
| [Consolidated Balance Sheets](#bs) | [F-4](#bs) |
| [Consolidated Statements of Operations](#sop) | [F-5](#sop) |
| [Consolidated Statements of Stockholders<u>'</u> <u>Equity</u>](#se) | [F-6](#se) |
| [Consolidated Statements of Cash Flows](#cf) | [F-7](#cf) |
| [Notes <u>to the Consolidated Financial Statements</u>](#notes) | [F-8](#notes) |

---

&nbsp;&nbsp;&nbsp;&nbsp; F-1

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**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the Board of Directors and Stockholders

Aytu BioPharma, Inc.

**Opinion on the financial statements** 

We have audited the accompanying consolidated balance sheets of Aytu BioPharma, Inc. (a Delaware corporation) and subsidiaries (the "Company") as of June 30, 2024, and 2023, the related consolidated statements of operations, stockholders' equity, and cash flows for each of the two years in the period ended June 30, 2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2024, and 2023, and the results of its operations and its cash flows for each of the two years in the period ended June 30, 2024, in conformity with accounting principles generally accepted in the United States of America.

**Basis for opinion** 

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the United States federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

&nbsp;&nbsp;&nbsp;&nbsp; F-2

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**Critical audit matter**

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

***Variable consideration related to certain gross to net adjustments***

As described further in Note 2 to the financial statements, the Company estimates adjustments to the transaction price of certain product sales ("Gross to Net" adjustments). Certain Gross to Net adjustments involve the use of significant assumptions and judgments to develop the estimate. The most significant assumption used in the ADHD Portfolio savings offers Gross to Net adjustment is the inventory levels in the distribution channel as of the balance sheet date. We identified the ADHD Portfolio savings offerings Gross to Net adjustment as a critical audit matter.

The principal considerations for our determination that the ADHD Portfolio savings offerings Gross to Net adjustment is a critical audit matter are (a) the inherent limitations over management's visibility and insight into the underlying details of the source data, which requires management to depend and rely on external data from multiple sources and (b) the extent to which the external data is used by management to develop the estimate of the ADHD Portfolio savings offerings Gross to Net adjustment.

Our audit procedures related to this critical audit matter included the following, among others:

(i) We evaluated the relevance and reliability of the external data used by management to develop the estimate of inventory levels in the distribution channel as of the balance sheet date.

(ii) We evaluated the reasonableness of the identified significant assumption related to inventory levels in the distribution channel to determine the ADHD Portfolio savings offers Gross to Net adjustment by comparing to external data.

(iii) We tested the overall reasonableness of the ADHD Portfolio savings offers Gross to Net adjustment as of the balance sheet date by developing an expectation for comparison to actual subsequent payments.

/s/ GRANT THORNTON LLP

We have served as the Company's auditor since 2022.

Denver, Colorado

September 26, 2024, except for the effects of discontinued operations discussed in Note 20 to the consolidated financial statements, as to which the date is April 28, 2025

&nbsp;&nbsp;&nbsp;&nbsp; F-3

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**AYTU BIOPHARMA, INC.**

**CONSOLIDATED BALANCE SHEETS**

**(in thousands, except share data)**

---

| | | |
|:---|:---|:---|
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
| **ASSETS** |  |  |
| Current assets: |  |  |
| Cash and cash equivalents | $20006 | $22985 |
| Accounts receivable, net | 23526 | 28728 |
| Inventories | 12141 | 8508 |
| Prepaid expenses and other current assets | 5097 | 5427 |
| Current assets of discontinued operations | 1121 | 5431 |
| Total current assets | 61891 | 71079 |
| Non-current assets: |  |  |
| Property and equipment, net | 693 | 1779 |
| Operating lease right-of-use assets | 829 | 1828 |
| Intangible assets, net | 52453 | 57441 |
| Other non-current assets | 2185 | 2454 |
| Non-current assets of discontinued operations | 44 | 1882 |
| Total non-current assets | 56204 | 65384 |
| **Total assets** | $**118095** | **136463** |
| **LIABILITIES AND STOCKHOLDERS**' **EQUITY** |  |  |
| Current liabilities: |  |  |
| Accounts payable | $10314 | $12549 |
| Accrued liabilities | 38143 | 45962 |
| Revolving credit facility | 2395 | 1563 |
| Current portion of debt | 1857 | 85 |
| Other current liabilities | 8962 | 7090 |
| Current liabilities of discontinued operations | 557 | 1766 |
| Total current liabilities | 62228 | 69015 |
| Non-current liabilities: |  |  |
| Debt, net of current portion | 10877 | 14713 |
| Derivative warrant liabilities | 12745 | 6403 |
| Other non-current liabilities | 4529 | 6975 |
| Total non-current liabilities | 28151 | 28091 |
| Commitments and contingencies (note 18) |  |  |
| Stockholders' equity |  |  |
| Preferred stock, par value $.0001; 50,000,000 shares authorized; no shares issued or outstanding |  |  |
| Common stock, par value $.0001; 200,000,000 shares authorized; 5,972,638 and 5,517,174 shares issued and outstanding, respectively | 1 | 1 |
| Additional paid-in capital | 347688 | 343485 |
| Accumulated deficit | (319973) | (304129) |
| Total stockholders' equity | 27716 | 39357 |
| **Total liabilities and stockholders' equity** | $**118095** | $**136463** |

---

The accompanying notes to the consolidated financial statements are an integral part of this statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F-4

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**AYTU BIOPHARMA, INC.**

**CONSOLIDATED STATEMENTS OF OPERATIONS**

**(in thousands, except share and per share data)**

---

| | | |
|:---|:---|:---|
|  | **Year Ended** | **Year Ended** |
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
| Net revenue | $65183 | $73799 |
| Cost of sales | 16129 | 21570 |
| Gross profit | 49054 | 52229 |
| Operating expenses: |  |  |
| Selling and marketing | 22083 | 24231 |
| General and administrative | 19954 | 25534 |
| Research and development | 2769 | 3979 |
| Amortization of intangible assets | 3683 | 3691 |
| Restructuring costs | 2156 |  |
| Impairment expense |  | 2730 |
| Gain from contingent consideration |  | (578) |
| Total operating expenses | 50645 | 59587 |
| **Loss from operations** | **(1591)** | **(7358)** |
| Other income, net | 870 | 425 |
| Interest expense | (5059) | (5149) |
| Derivative warrant liabilities (loss) gain | (4004) | 4793 |
| Loss on extinguishment of debt | (594) |  |
| **Loss from continuing operations before income tax expense** | **(10378)** | **(7289)** |
| Income tax expense | (2142) | (263) |
| **Net loss from continuing operations** | **(12520)** | **(7552)** |
| Net loss from discontinued operations, net of tax | (3324) | (9499) |
| **Net loss** | $**(15844)** | $**(17051)** |
| Basic and diluted weighted-average common shares outstanding | 5537957 | 3339906 |
| Basic and diluted net loss from continuing operations per share | $(2.26) | $(2.26) |
| Basic and diluted net loss from discontinued operations, net of tax per share | $(0.60) | $(2.84) |
| Basic and diluted net loss per share | $(2.86) | $(5.11) |

---

The accompanying notes to the consolidated financial statements are an integral part of this statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F-5

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**AYTU BIOPHARMA, INC.**

**CONSOLIDATED STATEMENTS OF STOCKHOLDERS**' **EQUITY**

**(in thousands, except share data)**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  |  | **Additional** |  | **Total** |
|  | **Common Stock** | **Common Stock** | **Paid-in** | **Accumulated** | **Stockholders'** |
|  | **Shares** | **Amount** | **Capital** | **Deficit** | **Equity** |
| Balances, June 30, 2022 | 1928941 | $— | $331386 | $(287078) | $44308 |
| Stock-based compensation expense | (18180) | *—* | 6046 | *—* | 6046 |
| Issuance of common stock, net of $1,004 issuance cost | 3606413 | 1 | 6053 |  | 6054 |
| Net loss | *—* |  |  | (17051) | (17051) |
| Balances, June 30, 2023 | 5517174 | 1 | 343485 | (304129) | 39357 |
| Stock-based compensation expense | 14250 | *—* | 2913 | *—* | 2913 |
| Issuance of common stock from exercise of warrants | 441214 | *—* | 1290 | *—* | 1290 |
| Net loss | *—* |  |  | (15844) | (15844) |
| Balances, June 30, 2024 | 5972638 | $1 | $347688 | $(319973) | $27716 |

---

The accompanying notes to the consolidated financial statements are an integral part of this statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F-6

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**AYTU BIOPHARMA, INC.**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(in thousands)**

---

| | | |
|:---|:---|:---|
|  | **Year Ended** | **Year Ended** |
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
| Cash flows from operating activities: |  |  |
| Net loss | $(15844) | $(17051) |
| Adjustments to reconcile net loss to cash used in operating activities: |  |  |
| Depreciation, amortization and accretion | 6725 | 7699 |
| Stock-based compensation expense | 2373 | 5722 |
| Derivative warrant liabilities loss (gain) | 4004 | (4793) |
| Amortization of debt discount and issuance costs | 597 | 559 |
| Inventory write-down | 1189 | 232 |
| Impairment expense |  | 2730 |
| Gain from contingent consideration |  | (578) |
| Non-cash loss on extinguishment of debt | 400 |  |
| Other non-cash adjustments | 471 | (30) |
| Non-cash adjustments from discontinued operations | 3357 | 6180 |
| Changes in operating assets and liabilities: |  |  |
| Accounts receivable, net | 5201 | (7239) |
| Inventories | (4821) | (3491) |
| Prepaid expenses and other current assets | 329 | 41 |
| Accounts payable | (2076) | 3091 |
| Accrued liabilities | (9161) | 4414 |
| Other operating assets and liabilities, net | 3801 | (1805) |
| Changes in operating assets and liabilities from discontinued operations | 2067 | (810) |
| **Net cash used in operating activities** | **(1388)** | **(5129)** |
| Cash flows from investing activities: |  |  |
| Other investing activities | (329) | (117) |
| **Net cash used in investing activities** | **(329)** | **(117)** |
| Cash flows from financing activities: |  |  |
| Net proceeds from issuance of common stock and warrants | 3467 | 15575 |
| Payment made to fixed payment arrangement | (2566) | (4266) |
| Net proceeds (payments) made on revolving credit facility | 832 | (2250) |
| Payments made to borrowings | (15722) | (96) |
| Proceeds from borrowings | 13000 |  |
| Payment for debt issuance costs | (273) | (92) |
| **Net cash (used in) provided by financing activities** | **(1262)** | **8871** |
| Net change in cash and cash equivalents | (2979) | 3625 |
| Cash and cash equivalents at beginning of period | 22985 | 19360 |
| **Cash and cash equivalents at end of period** | $**20006** | $**22985** |
| Supplemental disclosure of cash flows information: |  |  |
| Cash paid for interest | $4039 | $3812 |
| Cash paid for income taxes | $1608 | $— |
| Non-cash investing and financing activities: |  |  |
| Other non-cash investing and financing activities | $787 | $147 |

---

The accompanying notes to the consolidated financial statements are an integral part of this statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F-7

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**AYTU BIOPHARMA, INC.**

**NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS**

**Note *1* - Nature of Business and Financial Condition**

Aytu BioPharma, Inc. ("Aytu," the "Company," "we," "us," or "our"), is a pharmaceutical company focused on commercializing novel therapeutics. The Company was originally incorporated as Rosewind Corporation on *August 9, 2002,* in the state of Colorado and was re-incorporated as Aytu BioScience, Inc. in the state of Delaware on *June 8, 2015.* Following the acquisition of Neos Therapeutics, Inc. ("Neos") in *March 2021 (*the "Neos Acquisition"), the Company changed its name to Aytu BioPharma, Inc.

The Company's strategy is to become a leading pharmaceutical company that improves the lives of patients. The Company uses a focused approach of in-licensing, acquiring, developing, and commercializing novel prescription therapeutics in order to continue building its portfolio of revenue-generating products and leveraging its commercial team's expertise to build leading brands within large therapeutic markets. The Company's primary focus is on commercializing innovative prescription products that address conditions frequently developed or diagnosed in childhood.

In the *first* quarter of fiscal *2025* the Company completed the previously announced wind down and divestiture of its Consumer Health business. The accounting requirements for reporting the Consumer Health business as discontinued operation were met when the wind down and divestiture was completed on *July 31, 2024.* Accordingly, the Company's consolidated financial statements for all periods presented reflect the Consumer Health business as a discontinued operation and the Company determined that its continuing operations now operate in a single operating and reportable segment (see *Note *20* – *Discontinued Operations* and *Segment Information* within *Note *2* - Summary of Significant Accounting Policies* for further detail).

The Company's business from continuing operations is focused on its prescription pharmaceutical products sold primarily through *third* party wholesalers and pharmacies and which primarily consists of *two* product portfolios. The *first* consists of *two* products for the treatment of attention deficit hyperactivity disorder ("ADHD"): Adzenys XR-ODT (amphetamine) extended-release orally disintegrating tablets ("Adzenys") and Cotempla XR-ODT (methylphenidate) extended-release orally disintegrating tablets ("Cotempla" and Adzenys together with Cotempla the "ADHD Portfolio"). The *second* consists primarily of Karbinal® ER (carbinoxamine maleate extended-release oral suspension) ("Karbinal"), an extended-release *first*-generation antihistamine suspension containing carbinoxamine indicated to treat numerous allergic conditions, and Poly-Vi-Flor and Tri-Vi-Flor, *two* complementary prescription fluoride-based supplement product lines containing combinations of fluoride and vitamins in various formulations for infants and children with fluoride deficiency (the "Pediatric Portfolio").

During the *fourth* quarter of fiscal *2024,* the Company concluded that it had alleviated the Company's previously disclosed substantial doubt about its ability to continue as a going concern. This was primarily the result of the extinguishment of its $15.0 million term loan that was due in *January 2025,* while entering into a new $13.0 million term loan on more favorable terms to the Company with a maturity date of *June 2028.* Further, the Company maintained and extended the maturity date of its revolving credit facility to *June 2028* and had $5.6 million of remaining availability to draw upon as of *June 30, 2024 (*see *Note *10** – *Revolving Credit Facility* and *Note *11** – *Long-Term Debt* for further detail). In addition, during fiscal *2024* the Company received $3.5 million of net proceeds from the exercise of warrants, was in compliance with all of its debt covenants as of *June 30, 2024,* and through the filing of this Annual Report on Form *10*-K for the year ended *June 30, 2024 (*"Form *10*-K" or "Annual Report"). The Company has implemented and continues to implement plans to achieve operating profitability and increase cash flows, including various margin improvement initiatives, the wind down and divestiture of the Company's unprofitable Consumer Health business, and the indefinite suspension of certain research and development activities. Considering these factors, management has concluded that as of the filing of this Form *10*-K, substantial doubt about the Company's ability to continue as a going concern did *not* exist.

The Company's consolidated financial Statements and notes thereto have been prepared assuming that the Company will continue as a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business within *one* year after the date the consolidated financial statements and notes thereto are available to be issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *8*

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**Note *2* - Summary of Significant Accounting Policies**

***Principals of Consolidation***

The Company's consolidated financial statements and notes thereto include the accounts of its wholly owned subsidiaries Aytu Therapeutics, LLC and Neos and their respective wholly owned subsidiaries, as well as Innovus Pharmaceuticals, Inc. ("Innovus") and its wholly owned subsidiaries prior to the divestiture of Innovus on *July 31, 2024.* All significant inter-company balances and transactions have been eliminated in consolidation.

***Basis of Presentation***

The Company's consolidated financial statements and notes thereto have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP")

***Going Concern Determination***

In connection with the preparation for each annual and interim financial reporting period, management evaluates whether there are events that, in the aggregate, raise substantial doubt about the Company's ability to continue as a going concern within *one* year after the financial statements are available to be issued. The evaluation is based on relevant conditions and events that are known and reasonably knowable within *one* year after the date that the financial statements are available to be issued. Recurring operating losses or year over year negative cash flows from operating activities are considered negative trends. See *Note *1* – *Nature of Business and Financial Condition* for further detail on the evaluation performed by the Company.

***Use of Estimates***

The preparation of financial statements and footnotes requires the use of management estimates, judgments and assumptions. Actual results *may* differ from estimates. In the accompanying consolidated financial statements and notes thereto, estimates are used for, but *not* limited to, stock-based compensation; revenue recognition, determination of variable consideration for accruals of chargebacks, administrative fees and rebates, government rebates, returns and other allowances; allowance for credit losses; inventory impairment; determination of right-of-use assets and lease liabilities; valuation of financial instruments, derivative warrant liabilities, intangible assets, and long-lived assets; purchase price allocations and the depreciable lives of long-lived assets; accruals for contingent liabilities; and determination of the income tax provision, deferred taxes and valuation allowance.

***Prior Period Reclassification****.* 

Certain prior year amounts in the Company's consolidated financial statements and the notes thereto have been reclassified to conform to the current year presentation. These reclassifications did *not* impact operating results or cash flows for the fiscal years ended *June 30, 2024,* and *2023,* or its financial position as of *June 30, 2024,* or *June 30, 2023.*

***Previously Reported Prepaid Expenses Information***

During the year ended *June 30, 2024,* the Company identified that certain of the Company's prepaid expenses totaling $1.8 million that were previously reported as current assets as of *June 30, 2023,* should have been classified as non-current assets as of *June 30, 2023.* The Company assessed the materiality of this omission on the previously issued interim and annual consolidated financial statements in accordance with the United States Securities and Exchange Commission ("SEC") Staff Accounting Bulletin *No. 99,* "Materiality" and concluded that the omission was *not* material to any of the previously issued consolidated financial statements and began reporting the prepaid expenses as non-current within this Form *10*-K.

***Cash and Cash Equivalents***

The Company's primary objectives for investment of available cash are the preservation of capital and the maintenance of liquidity. The Company invests its available cash balances in bank deposits and money market funds. The cash balances in bank deposits are subject to the Federal Deposit Insurance Corporation ("FDIC") insurance limits, and cash balances in the money market funds are *not* FDIC insured. The Company considers all highly liquid instruments purchased with an original maturity of *three* months or less to be cash equivalents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *9*

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***Accounts Receivable, Net***

Accounts receivable represent amounts due from customers less allowances for credit losses, discounts and pricing chargebacks. An allowance for credit losses, when needed, is based on the best estimate of the amount of probable credit losses in existing accounts receivable, which is determined from the Company's historical write-off experience and expected future default probabilities based on ongoing evaluations of Company's customers' financial condition; payment history; collections experience on other accounts; and economic factors or events expected to affect future collections. An allowance for credit losses, when needed, consists of an amount identified for specific customers and an amount based on overall estimated exposure. Accounts receivable are customer obligations due under normal trade terms. Recovery of bad debt amounts which were previously written off are recorded as a reduction of bad debt expense in the period the payment is collected. If the Company's actual collection experience changes, revisions to the Company's allowance for credit losses *may* be required. After attempts to collect a receivable have failed, the receivable is written off against the allowance for credit losses. The allowance for credit losses was zero for both years ended *June 30, 2024,* and *2023.* The allowance for discounts was $0.6 million and $1.8 million as of *June 30, 2024,* and *2023,* respectively. The allowance for chargebacks was $1.2 million at both *June 30, 2024,* and *2023.*

The table below presents the opening and closing balances of accounts receivable, gross from customers.

---

| | |
|:---|:---|
|  | **Accounts**<br> **Receivable, Gross** |
|  | **(in thousands)** |
| Balance, June 30, 2022 | $24000 |
| Increase in accounts receivable, gross | 7718 |
| Balance, June 30, 2023 | 31718 |
| Decrease in accounts receivable, gross | (6370) |
| Balance, June 30, 2024 | $25348 |

---

The table below details the change in allowance for discounts and allowance for chargebacks for the periods presented.

---

| | | | |
|:---|:---|:---|:---|
|  | **Allowance for** <br> **Discounts** | **Allowance for** <br> **Chargebacks** | **Total Allowance** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** |
| Balances, June 30, 2022 | $1301 | $1206 | $2507 |
| Reduction of net revenue | 9074 | 4554 | 13628 |
| Payments | (8597) | (4548) | (13145) |
| Balances, June 30, 2023 | 1778 | 1212 | 2990 |
| Reduction of net revenue | 4886 | 3812 | 8698 |
| Payments | (6024) | (3842) | (9866) |
| Balances, June 30, 2024 | $640 | $1182 | $1822 |

---

***Inventories***

Inventories consist of raw materials, work in process and finished goods and are recorded at the lower of cost or net realizable value, with cost determined on a *first*-in, *first*-out basis. Prior to regulatory approval, before economic benefit is probable, pre-launch inventories are expensed as research and development.

The Company periodically reviews the composition of its inventories in order to identify obsolete, slow-moving or otherwise unsaleable items. In the event that such items are identified and there are *no* alternate uses for the inventory, the Company will record a charge to cost of sales to reduce the value of the inventory to net realizable value in the period the impairment is identified.

***Property and Equipment***

Property and equipment are recorded at cost less accumulated depreciation. Furniture and equipment are depreciated on a straight-line basis over their estimated useful lives which are generally two to seven years. Leasehold improvements are amortized over the shorter of the estimated useful life or remaining lease term. The Company begins depreciating assets when they are placed into service. Maintenance and repairs are expensed as incurred.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *10*

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***Leases***

At the inception of an arrangement, the Company determines if an arrangement is, or contains, a lease. Lease classification, recognition and measurement are determined at the lease commencement date. Lease liabilities and right-of-use ("ROU") assets are recorded based on the present value of lease payments over the expected lease term, including options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. In determining the present value of the lease payments, the Company uses the implicit interest rate when readily determinable and uses the Company's incremental borrowing rate when the implicit rate is *not* readily determinable based upon the information available at the lease commencement date.

Fixed lease payments, or in substance fixed, are recognized over the expected term of the lease using the effective interest method. Variable lease payments are expensed as incurred. Fixed and variable lease expenses on operating leases are recognized within cost of sales and operating expenses in the Company's consolidated statements of operations. ROU asset amortization and interest costs on financing leases are recorded within cost of sales and interest expense, respectively, in the Company's consolidated statements of operations. The Company has elected to account for payments on short-term leases as lease expense on a straight-line basis over lease terms of *12* months or less.

Operating leases are included in other liabilities in the Company's consolidated balance sheets. Financing leases are included in property and equipment, net, current portion of debt and debt, net of current portion in the Company's consolidated balance sheets.

***Fair Value of Financial Instruments***

*Acquisitions*

In an acquisition of a business or a group of assets, the Company uses the acquisition method of accounting which identifies, recognizes, and measures the identifiable assets acquired, liabilities assumed and any non-controlling interest at their acquisition date fair values. Any excess of the purchase consideration over the fair values of the net identifiable assets acquired is recorded as goodwill. If the Company determines the assets acquired do *not* meet the definition of a business, the transaction is accounted for as an acquisition of assets, which records the assets acquired at the purchase price and does *not* result in goodwill.

*Warrants*

The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant's specific terms and applicable authoritative guidance in Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic *480,* Distinguishing Liabilities from Equity ("ASC *480"*) and ASC Topic *815,* Derivatives and Hedging ("ASC *815"*). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC *480,* meet the definition of a liability pursuant to ASC *480,* and whether the warrants meet all of the requirements for equity classification under ASC *815,* including whether the warrants are indexed to the Company's own common shares and whether the warrant holders could potentially require "net cash settlement" in a circumstance outside of the Company's control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. Liability and equity classified warrants are valued using a Black-Scholes option pricing model or Monte Carlo simulation model at issuance and for each reporting period when applicable.

***Revenue Recognition***

The Company generates net revenue from continuing operations from sales of prescription pharmaceutical products from the Company's ADHD Portfolio and Pediatric Portfolio, principally to a limited number of wholesale distributors and pharmacies in the United States. The Company evaluates its contracts with customers to determine revenue recognition using the following *five*-step model: (*1*) identify the contract with the customer; (*2*) identify the performance obligations; (*3*) determine the transaction price; (*4*) allocate the transaction price to the performance obligations; and (*5*) recognize revenue when (or as) a performance obligation is satisfied. There is *not* a recognized financing component related to product sales. Net revenue is recognized at the point in time that control of the product transfers to the customer, which typically aligns with shipping terms (i.e., upon delivery), generally "free-on-board" destination when shipped domestically within the United States, consistent with contractual terms. The Company expenses the incremental costs to obtain a contract as incurred, since they are satisfied within *one* year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *11*

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ADHD Portfolio and Pediatric Portfolio net revenue is recognized net of consideration paid to the Company's customers and other adjustments to the transaction price (known as "Gross to Net" adjustments). Significant judgement is required in estimating Gross to Net adjustments considering legal interpretations of applicable laws and regulations, historical experience, payer channel mix, current contract prices under applicable programs, unbilled claims, processing time lags and inventory levels in the distribution channel.

The Gross to Net adjustments include:

● *Savings offers.* The Company offers savings programs for its patients covered under commercial payor plans in which the cost of a prescription to such patients is discounted.

● *Prompt payment discounts.* Prompt payment discounts are based on standard provisions of wholesalers' services.

● *Wholesale distribution fees.* Wholesale distribution fees are based on definitive contractual agreements for the management of the Company's products by wholesalers.

● *Rebates.* The Rx Portfolio products are subject to commercial managed care and government (i.e. Medicaid) programs whereby discounts and rebates are provided to participating managed care organizations and federal and/or state governments. Calculations related to rebate accruals are estimated based on historical information from *third*-party providers.

● *Wholesaler chargebacks.* The Rx Portfolio products are subject to certain programs with wholesalers whereby pricing on products is discounted below wholesaler list price to participating entities. These entities purchase products through wholesalers at the discounted price, and the wholesalers charge the difference between their acquisition cost and the discounted price back to the Company following the product purchases of the wholesalers' end customers.

● *Returns.* Wholesalers' contractual return rights are limited to defective product, product that was shipped in error, product ordered by customer in error, product returned due to overstock, product returned due to dating or product returned due to recall or other changes in regulatory guidelines. The return policy for expired product allows the wholesaler to return such product starting *six* months prior to expiry date to *twelve* months post expiry date. The Company analyzes return data available from sales since inception date to determine a reliable return rate.

Savings offers, rebates and wholesaler chargebacks reflect the terms of underlying agreements, which *may* vary. Accordingly, actual amounts will depend on the mix of sales by product and contracting entity. Future returns *may not* follow historical trends. The Company's periodic adjustments of its estimates are subject to time delays between the initial product sale and ultimate reporting and settlement of deductions. The Company continually monitors these provisions and do *not* believe variances between actual and estimated amounts have been material.

***Concentration of Credit Risk****.* 

Financial instruments that potentially subject the Company to credit risk concentrations consist of cash, cash equivalents and accounts receivable.

The Company maintains deposits in financial institutions in excess of federally insured limits. The Company periodically monitors the credit quality of the financial institutions with which it invests and believes that the Company is *not* exposed to significant credit risk due to the financial position of those institutions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *12*

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The Company is also subject to credit risk from accounts receivable related to product sales. The Company's customers, sometimes referred to as partners or customers, are primarily large wholesale distributors that resell the Company's products to retailers. The loss of *one* or more of these large customers could have a material adverse effect on the Company's business, operating results or financial condition. The Company does *not* charge interest or require collateral related to its accounts receivable. Credit terms are generally thirty to sixty days.

The following table presents customers that contributed more than *10%* of gross revenue and accounts receivable*:* 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Percentage of Gross**<br> **Revenue** | **Percentage of Gross**<br> **Revenue** | **Percentage of Accounts**<br> **Receivable** | **Percentage of Accounts**<br> **Receivable** |
|  | **June 30,**  | **June 30,**  | **June 30,**  | **June 30,**  |
|  | **2024** | **2023** | **2024** | **2023** |
| Customer A | 33% | 43% | 40% | 50% |
| Customer B | 20% | 18% | 29% | 19% |
| Customer C | 17% | 17% | 11% | 14% |

---

***Costs of Sales***

Costs of sales from continuing operations consists primarily of manufactured product cost, products acquired from *third*-party manufacturers, freight, production, inventory write-downs, indirect manufacturing overhead costs and United States Food and Drug Administration ("FDA") fees for commercialized products. Certain of the Company's sales activities depend on licensing arrangements that *may* require periodic milestone payments or royalty payments, which are also included in costs of sales. In addition, distribution, shipping and handling costs invoiced by the Company's *third*-party logistics companies are included in costs of sales.

***Stock-Based Compensation Expense***

The Company accounts for stock-based payment compensation expense using a fair value based model. Restricted stock and restricted stock unit grants are valued based on the estimated grant date fair value of the Company's common stock and recognized ratably over the requisite service period. Stock option grants are valued using the Black-Scholes option pricing model and compensation costs are recognized ratably over the period of service using the graded method. The Black-Scholes option pricing model requires the Company to estimate the expected term of the award, the expected volatility, the risk-free interest rate, and the expected dividends. The expected term is determined using the "simplified method," which is the midpoint between the vesting date and the end of the contractual term and is utilized by the Company as it does *not* have sufficient historical data to determine a more reliable expected term estimate. The risk-free interest rate is based on the United States Treasury yield in effect at the time of the grant for the expected term of the award. The Company does *not* anticipate paying any dividends in the near future. Forfeitures are recognized as they occur.

***Employee Benefits Plan***

The Company has a *401*(k) plan ("Aytu *401*(k) Plan"), which allows participants to contribute a portion of their salary, subject to eligibility requirements and annual Internal Revenue Service ("IRS") limits. The Aytu *401*(k) Plan matches 100% of the *first* 3% contributed by employees and matches 50% of the next 4% and 5% contributed by employees. The Company's match for the Aytu *401*(k) Plan was $0.7 million for both of the years ended *June 30, 2024,* and *2023.*

***Research and Development***

Research and development costs are expensed as incurred and include salaries and benefits; facilities costs; overhead costs; raw materials; laboratory and clinical supplies; clinical trial costs; contract services; milestone payments and fees paid to regulatory authorities for review and approval of the Company's product candidates; and other related costs.

***Intangible Assets***

The Company records acquired intangible assets based on fair value on the date of acquisition. Finite-lived intangible assets are recorded at cost and amortized on a straight-line basis over the estimated lives of the assets. Indefinite-lived intangible assets are *not* subject to amortization.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *13*

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***Impairment of Long-lived Assets***

The Company assesses impairment of asset groups, including intangible assets, when events or changes in circumstances indicate that their carrying amount *may not* be recoverable. Long-lived assets consist of property and equipment, net, right of use assets and other intangible assets, net. Circumstances which could trigger a review include, but are *not* limited to: (i) changes in Company plans; (ii) competition; (iii) significant adverse changes in the business climate or legal or regulatory factors; or (iv) expectations that the asset will more likely than *not* be sold or disposed of significantly before the end of its estimated useful life. If the estimated future undiscounted cash flows, excluding interest charges, from the use of an asset are less than its carrying value, a write-down would be recorded to reduce the related asset to its estimated fair value.

***Contingent Consideration***

The consideration for the Company's acquired businesses and licenses often includes future payments that are contingent upon the occurrence of a particular event or events. The Company records an obligation for such contingent payments at fair value on the acquisition date. Changes in the fair value of contingent consideration obligations are recognized in the consolidated statements of income, which resulted in a gain from contingent consideration from continuing operations of zero and $0.6 million for the years ended *June 30, 2024,* and *2023,* respectively. The Company did not have any contingent consideration recorded on its consolidated balance sheets as of *June 30, 2024,* and *2023.*

***Income Taxes***

The provision for income taxes is determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes and net operating loss and tax credit carryforwards. The amount of deferred taxes on these temporary differences is determined using the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, as applicable, based on tax rates and laws in the respective tax jurisdiction enacted as of the balance sheet date. A valuation allowance is recorded to reduce the net deferred tax asset when it is more likely than *not* that some portion or all of its deferred tax asset will *not* be utilized.

The Company recognizes the effect of income tax positions only if those positions are more likely than *not* to be sustained upon an examination. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense in the consolidated statements of operations.

***Debt Discount and Issuance Costs***

Debt issuance costs reflect fees paid to lenders and *third* parties directly related to issuing debt. Debt discount and issuance costs related to term loans are reported as direct deductions to the outstanding debt and amortized over the term of the debt using the effective interest method as an addition to interest expense. Debt issuance costs related to a revolving credit facility are classified as assets and subsequently amortized using the straight-line method over the term of the revolving credit facility as additional interest expense.

***Segment Information***

Operating segments are identified as components that engage in business activities from which it *may* earn revenues and incur expenses and for which discrete information is available and regularly reviewed by the Company's chief operating decision maker ("CODM") to make decisions about resources to be allocated to the segment and to assess performance. Operating segments are aggregated for reporting purposes when the operating segments are identified as similar in accordance with the basic principles and aggregation criteria in the accounting standards. After the previously announced successful wind down and divestiture of the Consumer Health business in the *first* quarter of fiscal *2025,* the Company determined that its continuing operations operate in a single operating and reportable segment. The Company's CODM is its Chief Executive Officer who manages operations and regularly reviews the financial information of the Company's continuing operations as a single operating segment for the purposes of allocating resources and evaluating its financial performance, and for which discrete financial information is available. The results of the Consumer Health business have been reported as discontinued operations (see *Note *20* – *Discontinued Operations* for further detail).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *14*

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***Paragraph IV Litigation Costs***

Legal costs incurred by the Company in the enforcement of the Company's intellectual property rights are charged to expense.

***Business Combinations***

The Company recognizes the identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date. The excess of purchase price over the aggregate fair values is recorded as goodwill. The Company calculates the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed to allocate the purchase price at the acquisition date.

***Employee Retention Credit***

On *March 27, 2020,* the United States government enacted the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") to provide certain relief as a result of the COVID-*19* pandemic. The CARES Act provides tax relief, along with other stimulus measures, including a provision for an Employee Retention Credit ("ERC"), which allows for employers to claim a refundable payroll tax credit against the employer share of Social Security tax equal to *70%* of the qualified wages paid to employees after *December 31, 2020,* through *September 30, 2021.* The ERC was designed to encourage businesses to keep employees on the payroll during the COVID-*19* pandemic.

As there is *no* authoritative guidance under U.S. GAAP on accounting for government assistance to for-profit business entities, the Company will account for the ERC by analogy to International Accounting Standard ("IAS") *20,* Accounting for Government Grants and Disclosure of Government Assistance ("IAS *20"*). In accordance with IAS *20,* the Company recorded a $3.8 million ERC accrual in other non-current liabilities, which represents the proceeds the Company received from the ERC program during the *first* quarter of fiscal *2024.* Further in accordance with IAS *20,* when management determines it has reasonable assurance that the Company has substantially met all eligibility requirements of the ERC and following any adjustments from its regulatory audit or upon further clarifications from the IRC, the ERC accrual shall be recognized as a benefit in other income in the consolidated statement of operations. The associated vendor fee of $0.4 million was expensed as incurred in the *first* quarter of fiscal *2024.*

***Earnings Per Share***

Basic net income or loss per common share is calculated by dividing net income or loss available to common stockholders by the basic weighted-average number of common shares outstanding for the respective period. Diluted net income or loss per common share is calculated by dividing adjusted net income or loss by the diluted weighted-average number of common shares outstanding, which includes the effect of potentially dilutive securities. Potentially dilutive securities for this calculation consist of warrants to purchase common stock that are either liability classified or equity classified (see *Note *16* – *Warrants*); employee stock options (see *Note *15* – *Equity Incentive Plans*); employee unvested restricted stock (see *Note *15* – *Equity Incentive Plans)*; and employee unvested restricted stock units (see *Note *15* – *Equity Incentive Plans)*. For the years ended *June 30, 2024,* and *2023,* the Company incurred a net loss from continuing operations; a net loss from discontinued operations, net of tax; and a net loss and thus did *not* include common equivalent shares in the computation of diluted net loss from continuing operations per share; diluted net loss from discontinued operations, net of tax; or diluted net loss per share because the effect would have been anti-dilutive.

The following table sets forth securities excluded from the calculation of diluted earnings per share.

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| | | | |
|:---|:---|:---|:---|
|  |  | **June 30,**  | **June 30,**  |
|  |  | **2024** | **2023** |
| Warrants to purchase common stock - liability classified | *(Note 16)* | 6057766 | 6498980 |
| Warrants to purchase common stock - equity classified | *(Note 16)* | 18114 | 39072 |
| Employee stock options | *(Note 15)* | 146539 | 52762 |
| Employee unvested restricted stock | *(Note 15)* | 25360 | 40996 |
| Employee unvested restricted stock units | *(Note 15)* | 1775 | 4963 |
| Total |  | 6249554 | 6636773 |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *15*

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***Recently Adopted Accounting Pronouncements***

*Financial Instruments - Credit Losses*

In *June 2016,* the FASB issued Accounting Standards Update ("ASU") *No. 2016*-*13, Financial Instruments*—*Credit Losses* ("ASU *2016*-*13"*), which requires the measurement of expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable forecasts. The main objective of ASU *2016*-*13* is to provide additional information about the expected credit losses on financial instruments and other commitments to extend credit. The standard was effective for interim and annual reporting periods beginning after *December 15, 2019.* However, in *October 2019,* the FASB approved deferral of the adoption date for smaller reporting companies for fiscal periods beginning after *December 15, 2022.* The effective dates for the amendments in ASU *2022*-*02* align with those of ASU *2016*-*13.* The Company adopted ASU *2016*-*13* and ASU *2019*-*05* on *July 1, 2023.* The Company evaluated the impact of adoption of ASUs *2016*-*13, 2019*-*05,* and *2022*-*02* and concluded that the application of the new standards did *not* have a material impact on the Company's consolidated financial statements.

***Recent Accounting Pronouncements *Not* Yet Adopted***

*Debt* - *Debt with Conversion and Other Options*

In *August 2020,* the FASB issued ASU *No. 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*)*—*Accounting for Convertible Instruments and Contracts in an Entity*'*s Own Equity*, which simplifies the accounting for convertible instruments by removing major separation models currently required. Consequently, more convertible debt instruments will be reported as a single liability instrument with *no* separate accounting for embedded conversion features. The amendments in this update are effective for public entities that are smaller reporting companies, as defined by the SEC, for the fiscal years beginning after *December 15, 2023,* including interim periods within those fiscal years. Early adoption is permitted through a modified retrospective or full retrospective method. The Company adopted the guidance on *July 1, 2024,* and the adoption of the standard did *not* have a material impact on the Company's consolidated financial statements.

*Segment Reporting*

In *November 2023,* the FASB issued ASU *No. 2023*-*07, Segment Reporting (Topic *280*): Improvements to Reportable Segment Disclosures* ("ASU *2023*-*07"*). ASU *2023*-*07* was issued to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The guidance should be applied retrospectively unless it is impracticable to do so. ASU *2023*-*07* is effective for fiscal years beginning after *December 15, 2023,* and interim periods in fiscal years beginning after *December 15, 2024.* Early adoption is permitted, including in an interim period. The Company is currently evaluating the provisions of this guidance and assessing the potential impact on the Company's consolidated financial statements and disclosures.

Other than the application of IAS *20* for the ERC, there have been *no* significant changes to the Company's significant accounting policies and there is *no* other accounting guidance has been issued and *not* yet adopted that is applicable to the Company and that the Company expects would have a material effect on the Company's consolidated financial statements and related disclosures as of *June 30, 2024,* and through the filing of this Form *10*-K.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *16*

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**Note *3* - Revenue**

The Company disaggregates its net revenue from continuing operations by significant product portfolio, which includes the ADHD Portfolio, comprised of Adzenys and Cotempla; and the Pediatric Portfolio, comprised of Karbinal, Poly-Vi-Flor and Tri-Vi-Flor.

***Revenues by Product Portfolio***

Net revenue disaggregated by significant product portfolios for the years ended *June 30, 2024,* and *2023,* were as follows:

---

| | | |
|:---|:---|:---|
|  | **Year Ended** | **Year Ended** |
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| ADHD Portfolio | $57784 | $46855 |
| Pediatric Portfolio | 7280 | 25377 |
| Other | 119 | 1567 |
| Total net revenue | $65183 | $73799 |

---

Other includes net revenue from various discontinued or deprioritized products. The Consumer Health business was divested in the *first* quarter of fiscal *2025* and is reported within discontinued operations (see *Note *20* – Discontinued Operations*).

***Revenues by Geographic Location***

The Company's net revenue is predominately within the United States, with insignificant international sales.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *17*

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**Note *4* - Inventories**

Inventories consist of the following:

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| | | |
|:---|:---|:---|
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Raw materials | $266 | $1301 |
| Work in process | 5725 | 2956 |
| Finished goods | 6150 | 4251 |
| Inventories | $12141 | $8508 |

---

The Company incurred inventory write-downs from continuing operations of $1.2 million and $0.2 million during the years ended *June 30, 2024,* and *2023,* respectively, primarily a result of unsalable and slow-moving products.

**Note *5* - Property and Equipment**

Property and equipment, net consist of the following:

---

| | | |
|:---|:---|:---|
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Manufacturing equipment | $1117 | $2377 |
| Office equipment, furniture and other | 945 | 1085 |
| Lab equipment | 721 | 832 |
| Leasehold improvements | 35 | 999 |
| Assets under construction |  | 107 |
| Property and equipment, gross | 2818 | 5400 |
| Less accumulated depreciation and amortization | (2125) | (3621) |
| Property and equipment, net | $693 | $1779 |

---

Depreciation expense from continuing operations was $0.9 million and $1.3 million during the years ended *June 30, 2024,* and *2023,* respectively. During the year ended *June 30, 2024,* the Company did not record a material gain or loss on disposal of equipment and during the year ended *June 30, 2023,* the Company recognized a gain of $0.1 million on the disposal of equipment.

**Note *6* - Leases**

The Company's operating leases are for its offices, manufacturing facilities and equipment, and its finance leases were for equipment. These leases have original lease periods expiring between *2022* and *2030.* Most leases include option provisions under which the parties *may* extend the lease term. Certain non-real estate leases also include options to purchase the leased property. The Company's lease agreements generally do *not* contain any material residual value guarantees or material restrictive covenants. The Company had no remaining finance leases recorded as of *June 30, 2024.*

In connection with the Neos Acquisition, Aytu assumed an operating lease ROU asset and lease liability of $3.5 million, which represented the present value of the remaining lease payments as of the acquisition date, for the office space and manufacturing facilities at Grand Prairie, Texas. As the lease agreement does *not* provide an implicit rate, a borrowing rate of 6.7% was used to determine the present value of future lease payments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *18*

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During the *fourth* quarter of fiscal *2024,* as part of the previously announced closure of the Grand Prairie, Texas manufacturing site, the Company ceased using the Grand Prairie, Texas manufacturing facility. As a result, the Company wrote off the remaining related operating lease ROU asset. The lease for the Grand Prairie, Texas manufacturing site is set to expire on *December 31, 2024,* respectively.

In *June 2024,* the Company entered into a forward-starting operating lease agreement to lease office space in Berwyn, Pennsylvania from the owner of the office space that the Company is currently renting under a sublease arrangement. The Company has determined that it is an operating lease, and that lease commencement occurred in *July 2024.* The initial lease termination date is *July 31, 2030,* and under the lease agreement the Company has *one five*-year renewal option to extend the lease through *July 2035.* Undiscounted minimum monthly rent payments average approximately $13,000 over the initial term of the lease. The Company has elected to utilize the practical expedient to *not* separate lease and non-lease components upon recognition and variable lease payments will be expensed as incurred. The Company will record an operating lease ROU asset of $0.5 million and a lease liability of $0.5 million at lease commencement in *July 2024.* The ROU asset and lease liability will be recorded at present value using an incremental borrowing rate of 12.3%.

In *May 2023,* the Company entered into a lease agreement to relocate its principal office. The space was made available to the Company in *September 2023 (*lease commencement) with an initial term of five and a half years. The Company recorded an operating lease ROU asset of $0.8 million and a lease liability of $0.8 million at lease commencement. The ROU asset and lease liability were recorded at present value using an incremental borrowing rate of 10.3%. The Company utilized the practical expedient to *not* separate lease and non-lease components upon recognition. See *Note *18** – *Commitments and Contingencies* for further detail.

The components of lease expenses for continuing operations are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** |  |
|  | **June 30,** | **June 30,** |  |
|  | **2024** | **2023** | **Statement of Operations Classification** |
|  | **(in thousands)** | **(in thousands)** |  |
| Lease cost: |  |  |  |
| Operating lease cost | $1986 | $1350 | *Operating expenses* |
| Short-term lease cost | 94 | 97 | *Operating expenses* |
| Finance lease cost: |  |  |  |
| Amortization of leased assets | 53 | 66 | *Cost of sales* |
| Interest on lease liabilities | 3 | 9 | *Interest expense* |
| Total lease cost | $2136 | $1522 |  |

---

Supplemental balance sheet information related to leases is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **June 30,** | **June 30,** |  |
|  | **2024** | **2023** | **Balance Sheet Classification** |
|  | **(in thousands)** | **(in thousands)** |  |
| Assets: |  |  |  |
| Operating lease assets | $829 | $1828 | *Operating lease right-of-use assets* |
| Finance lease assets |  | 159 | *Property and equipment, net* |
| Total lease assets | $829 | $1987 |  |
| Liabilities: |  |  |  |
| Current: |  |  |  |
| Operating leases | $712 | $1258 | *Other current liabilities* |
| Finance leases |  | 85 | *Current portion of debt* |
| Non-current: |  |  |  |
| Operating leases | 577 | 832 | *Other liabilities* |
| Total lease liabilities | $1289 | $2175 |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *19*

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The remaining weighted-average lease term and discount rate used are as follows:

---

| | | |
|:---|:---|:---|
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
| Weighted-average remaining lease term (years): |  |  |
| Operating lease assets | 2.7 | 1.5 |
| Finance lease assets | *—* | 0.9 |
| Weighted-average discount rate: |  |  |
| Operating lease assets | 10.0% | 6.5% |
| Finance lease assets | *—*% | 6.5% |

---

Supplemental cash flow information related to leases is as follows:

---

| | | |
|:---|:---|:---|
|  | **Year Ended** | **Year Ended** |
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Cash flow classification of lease payments: |  |  |
| Operating cash flows from operating leases | $1723 | $1350 |
| Operating cash flows from finance leases | $3 | $9 |
| Financing cash flows from finance leases | $85 | $96 |

---

As of *June 30, 2024,* the Company did not have any remaining finance leases. As of *June 30, 2024,* the Company's future minimum operating lease payments, including the new forward-starting operating lease agreement to lease office space in Berwyn, Pennsylvania were as follows:

---

| | |
|:---|:---|
|  | **Operating**  |
|  | **(in thousands)** |
| 2025 | $970 |
| 2026 | 399 |
| 2027 | 377 |
| 2028 | 386 |
| 2029 | 359 |
| Thereafter | 249 |
| Total lease payments | 2740 |
| Less: imputed interest | (555) |
| Lease liabilities | $2185 |

---

**Note *7* - Intangible Assets**

A summary of the Company's intangible assets as of *June 30, 2024,* and *June 30, 2023,* is as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **June 30, 2024** | **June 30, 2024** | **June 30, 2024** | **June 30, 2024** |
|  | **Gross** <br> **Carrying** <br> **Amount** | **Accumulated Amortization** | **Net** <br> **Carrying**<br> **Amount** | **Weighted-**<br> **Average** <br> **Remaining** <br> **Life** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** | **(in years)** |
| Acquired product technology rights | $41268 | $(13184) | $28084 | 10.7 |
| Acquired technology rights | 30200 | (5831) | 24369 | 13.8 |
| Total definite-lived intangible assets | $71468 | $(19015) | $52453 | 12.0 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *20*

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---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **June 30, 2023** | **June 30, 2023** | **June 30, 2023** | **June 30, 2023** |
|  | **Gross** <br> **Carrying** <br> **Amount** | **Accumulated Amortization** | **Net** <br> **Carrying** <br> **Amount** | **Weighted-**<br> **Average** <br> **Remaining** <br> **Life** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** | **(in years)** |
| Acquired product technology rights | $42176 | $(10881) | $31295 | 11.5 |
| Acquired technology rights | 30200 | (4054) | 26146 | 14.8 |
| Total definite-lived intangible assets | $72376 | $(14935) | $57441 | 13.0 |

---

Gross carrying amounts are net of any impairment charges from prior periods. An intangible asset with *zero* net carrying amount at the end of a reporting period is *not* presented in the table of a future reporting period. Certain of the Company's amortizable intangible assets include renewal options, extending the expected life of the asset. The renewal periods range between approximately 1 to 20 years depending on the license, patent or other agreement. Renewals are accounted for when they are reasonably assured. Intangible assets are amortized using the straight-line method over the estimated useful lives. Amortization expense of intangible assets from continuing operations was $5.0 million for both of the years ended *June 30, 2024,* and *2023.*

The following table summarizes the estimated future amortization expense of intangible assets to be recognized over the next *five* years and periods thereafter:

---

| | |
|:---|:---|
|  | **June 30,**  |
|  | **(in thousands)** |
| 2025 | $4989 |
| 2026 | 4989 |
| 2027 | 4989 |
| 2028 | 4989 |
| 2029 | 4989 |
| Thereafter | 27508 |
| Total future amortization expense | $52453 |

---

***Acquired Product Technology Rights***

The acquired product technology rights are related to the rights to production, supply and distribution agreements of various products pursuant to the acquisition of the Pediatric Portfolio in *November 2019* and the Neos Acquisition in *March 2021.*

*Karbinal*

The Company acquired and assumed all rights and obligations pursuant to the supply and distribution agreement, as amended, with Tris Pharma, Inc. ("Tris") for the exclusive rights to commercialize Karbinal in the United States (the "Tris Karbinal Agreement"). The Tris Karbinal Agreement's initial term terminates in *August* of *2033,* with an optional initial 20-year extension.

*Poly-Vi-Flor and Tri-Vi-Flor*

The Company acquired and assumed all rights and obligations pursuant to a supply and license agreement and various assignment and release agreements, including a previously agreed to settlement and license agreements (the "Poly-Tri Agreements") for the exclusive rights to commercialize Poly-Vi-Flor and Tri-Vi-Flor in the United States.

*ADHD Portfolio*

As part of the Neos Acquisition, the Company acquired developed product technology for the production and sale of Adzenys and Cotempla. The formulations for the ADHD products are protected by patented technology. The estimated economic life of these proprietary technologies is 16 years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *21*

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***Acquired Technology Right***

*TRRP Proprietary Technology*

As part of the Neos Acquisition, the Company acquired time release resin particle ("TRRP") proprietary technology, which is a proprietary drug delivery technology protected by the Company as a trade secret that allows the Company to modify the drug release characteristics of each of its respective products. The TRRP technology underlines each of the ADHD Portfolio core products and can potentially be used in future product development initiatives as well.

***Acquired In-Process R&D***

*IPR&D* – *NT0502*

As part of the Neos Acquisition, the Company acquired in-process research and development associated with *NT0502,* a new chemical entity that was being developed for the treatment of sialorrhea, which is excessive salivation or drooling. During the year ended *June 30, 2023,* the Company terminated its development program of *NT0502.* As a result, the Company fully impaired the IPR&D of *NT0502,* recording impairment expense of $2.6 million during the *second* quarter of fiscal *2023.*

**Note *8* - Accrued liabilities**

Accrued liabilities consist of the following:

---

| | | |
|:---|:---|:---|
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Accrued savings offers | $11054 | $15739 |
| Accrued program liabilities | 9964 | 11012 |
| Accrued customer and product related fees | 5395 | 6579 |
| Accrued compensation | 4603 | 5299 |
| Return reserve | 4832 | 5683 |
| Other accrued liabilities | 2295 | 1650 |
| Total accrued liabilities | $38143 | $45962 |

---

Accrued savings offers represent programs for the Company's patients covered under commercial payor plans in which the cost of a prescription to such patients is discounted. Accrued program liabilities include government and commercial rebates. Accrued customer and product related fees include accrued expenses and deductions for rebates, wholesaler chargebacks and fees, and other product-related fees and deductions such as royalties for Pediatric Portfolio products, accrued distributor fees, and Medicaid liabilities. Accrued employee compensation includes sales commissions, paid time off earned, accrued payroll and accrued bonus. The return reserve represents the Company's accrual for estimated product returns. Other accrued liabilities consist of various other accruals, *none* of which individually or in the aggregate represent greater than *five* percent of total liabilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *22*

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The following table details the change in return reserve for the periods presented:

---

| | |
|:---|:---|
|  | **Return Reserve** |
|  | **(in thousands)** |
| Balance, June 30, 2022 | $5559 |
| Reduction of net revenue | 6785 |
| Payments | (6661) |
| Balance, June 30, 2023 | 5683 |
| Reduction of net revenue | 5838 |
| Payments | (6689) |
| Balance, June 30, 2024 | $4832 |

---

**Note *9* - Other Liabilities**

Other liabilities consist of the following:

---

| | | |
|:---|:---|:---|
|  | **June 30,**  | **June 30,**  |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Fixed payment arrangements | $8337 | $10420 |
| Employee retention credit | 3759 |  |
| Operating lease liabilities | 1289 | 2090 |
| Other | 106 | 1555 |
| Total other liabilities | 13491 | 14065 |
| Less: current portion of other liabilities | (8962) | (7090) |
| Total other liabilities, non-current | $4529 | $6975 |

---

***Fixed payment arrangements***

Fixed payment arrangements represent obligations to an investor assumed as part of the acquisition of products from Cerecor, Inc. in *2019,* including fixed and variable payments.

In *May 2022,* the Company entered into an agreement with Tris to terminate the license, development, manufacturing and supply agreement dated *November 2, 2018,* related to Tuzistra XR (the "Tuzistra License Agreement"). Pursuant to such termination, as of *June 30, 2024,* the Company has accrued a settlement liability of $6.2 million in other current liabilities on the consolidated balance sheet payable to Tris, with a provision that allows the Company to pay interest on any principal amounts due but remaining unpaid past *July 2024.*

The Tris Karbinal Agreement grants the Company exclusive right to distribute and sell the product in the United States. The initial term of the agreement was 20 years. The Company pays Tris a royalty equal to 23.5% of net revenue from the product. The Tris Karbinal Agreement also contains minimum unit sales commitments, which is based on a commercial year that spans from *August 1* through *July 31,* of 70,000 units annually through *2025.* The Company is required to pay Tris a royalty make-whole payment of $30 for each unit under the 70,000-unit annual minimum sales commitment through *2025.* The Tris Karbinal Agreement make-whole payment is capped at $2.1 million each year. The annual payment is due in *August* of each year. The Tris Karbinal Agreement also has multiple commercial milestone obligations that aggregate up to $3.0 million based on cumulative net revenue from the product, the *first* of which is triggered at $40.0 million. As of *June 30, 2024,* the fixed payment arrangement balance was $1.9 million in other current liabilities, and $0.2 million in other non-current liabilities on the consolidated balance sheet.

***Employee Retention Credit***

The $3.8 million ERC accrual in other non-current liabilities as of *June 30, 2024,* represents the proceeds the Company received from the ERC program during the *first* quarter of fiscal *2024.* Please see *Note *2* - Significant of Significant Accounting Policies* for further detail.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *23*

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***Operating Lease Liabilities***

The Company has entered into various operating lease agreements for certain of its offices, manufacturing facilities and equipment. Please refer to *Note *6* - Leases* for further detail.

***Other***

Other consists of taxes payable, deferred cost related to the Company's technology transfer, and various other accruals, *none* of which individually or in the aggregate represent greater than *five* percent of total liabilities.

**Note *10* - Revolving Credit Facility**

On *June 12, 2024,* the Company and certain of its subsidiaries entered into consent, joinder and amendment *No. 5* (the "Eclipse Amendment *No. 5"*) to the loan and security agreement dated *October 2, 2019,* as amended by amendment *No. 1,* dated *March 19, 2021,* amendment *No. 2,* dated *January 26, 2022,* amendment *No. 3,* dated *June 1, 2022,* amendment *No. 4* dated *March 24, 2023,* and the Eclipse Amendment *No. 5* (together the "Eclipse Agreement") with Eclipse Business Capital LLC ("Eclipse"), as agent, and the lenders party thereto (agent and such lenders, collectively, the "Eclipse Lender"). Under the Eclipse Amendment *No. 5,* which provided for among other things, *two* loan agreements, a term loan (the "Eclipse Term Loan") and a revolving credit facility (the "Eclipse Revolving Loan"). The Eclipse Term Loan is described further in *Note *11* - Long-Term Debt*. The Eclipse Revolving Loan provides for a maximum amount available under the revolving credit facility provided under the Eclipse Agreement of $14.5 million at an interest rate of the secured overnight financing rate as administered by the SOFR Administrator ("SOFR") plus 4.5%. In addition, the Company is required to pay an unused line fee of 0.5% of the average unused portion of the maximum Eclipse Revolving Loan amount during the immediately preceding month. The ability to make borrowings and obtain advances of revolving loans under the Eclipse Agreement remains subject to a borrowing base and reserve, and availability blockage requirements. The Eclipse Revolving Loan maturity date, as amended, is *June 12, 2028,* and the effective interest rate was 9.9% as of *June 30, 2024.*

In the event that, for any reason, all or any portion of the Eclipse Agreement is terminated prior to the scheduled maturity date, in addition to the payment of all outstanding principal and unpaid accrued interest, the Company is required to pay a fee equal to (i) 2.0% of the Eclipse Revolving Loan commitment if such event occurs on or before *June 12, 2025, (*ii) 1.0% of the Eclipse Revolving Loan commitment if such event occurs after *June 12, 2025,* but on or before *June 12, 2026,* and (iii) 0.5% of the Eclipse Revolving Loan commitment if such event occurs after *June 12, 2026,* but on or before *June 12, 2028.* The Company *may* also be required to pay an early termination fee related to the Eclipse Term Loan as further described in *Note *11* - Long-Term Debt*. The Company *may* permanently terminate the Eclipse Agreement upon written notice to Eclipse.

The Eclipse Agreement contains customary affirmative covenants, negative covenants and events of default, as defined in the agreement, including covenants and restrictions that, among other things, require the Company to satisfy certain capital expenditure limitations and other financial covenants, and restrict the Company's ability to incur liens, incur additional indebtedness, make certain dividends and distributions with respect to equity securities, engage in mergers and acquisitions or make asset sales without the prior written consent of Eclipse. A failure to comply with these covenants could permit Eclipse to declare the Company's obligations under the Eclipse Agreement, together with accrued interest and fees, to be immediately due and payable, plus any applicable additional amounts relating to a prepayment or termination, as described above. As of *June 30, 2024,* the Company was in compliance with the covenants under the Eclipse Agreement. The Company's obligations under the Eclipse Agreement are secured by substantially all of the Company's assets, as defined further in the Eclipse Agreement.

The Company allocated debt issuance costs of $0.1 million related to the Eclipse Revolving Loan, bringing to the total debt issuance costs related to the Eclipse Revolving Loan to $0.2 million, which will be amortized straight-line over the term of the loan. Total interest expense on the Eclipse Revolving Loan, including amortization of deferred financing costs, was $0.1 million and $0.7 million for the years ended *June 30, 2024,* and *2023.* As of *June 30, 2024,* and *2023,* the outstanding amounts drawn on the Eclipse Revolving Loan were $2.4 million and $1.6 million, respectively. The unused revolving credit facility amount as of *June 30, 2024,* was $5.6 million.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *24*

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**Note *11* - Long-Term Debt**

***Avenue Capital Loan***

On *January 26, 2022 (*"Closing Date"), the Company entered into a loan and security agreement (the "Avenue Capital Agreement") with Avenue Venture Opportunities Fund II, L.P. and Avenue Venture Opportunities Fund II, L.P. as lenders (the "Avenue Capital Lenders"), and Avenue Capital Management II, L.P. as administrative agent (the "Avenue Capital Agent"), collectively ("Avenue Capital"), pursuant to which the Avenue Capital Lenders provided the Company and certain of its subsidiaries with a secured $15.0 million loan. The interest rate on the loan was the greater of the prime rate or 3.25%, plus 7.4%, payable monthly in arrears. The maturity date of the loan was *January 26, 2025.* The proceeds from the Avenue Capital Agreement were used towards the repayment of the term loans.

Pursuant to the Avenue Capital Agreement, the Company was required to make interest only payments for the *first 18* months following the Closing Date (the "Interest-only Period"). The Interest-only Period could be extended automatically without any action by any party for *six* months provided as of the last day of the Interest-only Period then in effect, the Company received, prior to *June 15, 2023,* a specified amount of net proceeds from the sale and issuance of its equity securities ("Interest-only Milestone *1"*). The Interest-only Period was able to be further extended automatically without any action by any party for an additional *six* months provided, the Company had achieved, prior to *December 31, 2023, (*i) Interest-only Milestone *1* and (ii) a specified amount of trailing *12* months revenue as of the date of determination.

On *January 26, 2022 (*"Issuance Date"), as consideration for entering into the Avenue Capital Agreement, the Company issued warrants to the Avenue Capital Lenders to purchase shares of common stock at an exercise price equal to $24.20 per share (the "Avenue Capital Warrants"). The Avenue Capital Warrants provided that in the event the Company were to engage in an equity offering at a price lower than $24.20 prior to *June 30, 2022,* the exercise price would be adjusted to the effective price of such equity offering and the number of shares of common stock to be issued under the Avenue Capital Warrants would be adjusted as set forth in the agreement. The Avenue Capital Warrants were immediately exercisable and expire on *January 31, 2027.* At inception, the Company accounted for the Avenue Capital Warrants as a derivative warrant liability as the number of warrants was *not* fixed at the Issuance Date. The fair value of the Avenue Capital Warrants at issuance was approximately $0.6 million.

On *March 7, 2022,* the Company closed on an equity offering of shares of common stock and warrants, as described in *Note *15* - Stockholders Equity*, at an offering price of $25.00 per share. As this offering precluded the Company from pursuing any equity financing prior to *July 7, 2022,* and the effective price of the *March 7, 2022,* offering was more than the exercise price of the Avenue Capital Warrants, the shares of common stock issuable upon exercise of the Avenue Capital Warrants were set at an exercise price of $24.20.

On *October 25, 2022,* the Company entered into an agreement with Avenue Venture Opportunities Fund, L.P ("Avenue") to extend the interest-only period of its existing senior secure loan facility held with Avenue. The amendment to the original loan agreement, which was executed in *January 2022,* extended the interest-only period to *January 2024.* In exchange for this extension of the interest-only period, the Company and Avenue agreed to reset the exercise price of the warrants issued in conjunction with the original loan agreement to $8.60, corresponding to the warrant exercise price associated with the Company's *August 2022* equity financing.

On *June 13, 2023,* in conjunction with the Securities Purchase Agreement described in *Note *16* - Warrants*, the interest-only period of the Avenue Capital Agreement was extended further upon the achievement of both the revenue-based milestone and equity raise-based milestone stipulated in the Avenue Capital Agreement. As a result, the interest-only period was extended to *January 26, 2025.*

In addition to the debt discount discussed above, the Company also incurred $0.4 million loan origination, legal and other fees. The debt discount and issuance costs were being amortized over the term of the loan, using the effective interest method resulting in an effective rate of 16.6%. Total interest expense on the Avenue Capital loan including debt discount amortization, were $3.4 million and $2.7 million for the years ended *June 30, 2024,* and *2023.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *25*

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On *June 12, 2024,* the Company used proceeds from the Eclipse Term Loan and a portion of the proceeds from the exercise of warrants to repay the Avenue Capital loan in full. Upon early repayment of the Avenue Capital loan, the Company was required to pay Avenue Capital a fee equal to 1.0% of the loan or $0.2 million. In addition, upon the payment in full of the obligations, the Company was required to pay Avenue Capital a fee in the amount of $0.6 million ("Final Payment"). At inception, the Company accounted for the Final Payment as additional obligations on the debt, with the corresponding charge being recorded as debt discount. At retirement, the early termination fee, the Final Payment fee, and the write-off of all remaining related debt discount and deferred financing costs were included in the calculation of loss on extinguishment of debt. The Company recorded a loss on extinguishment of debt of $0.6 million related to the retirement of the Avenue Capital loan in the *fourth* quarter of fiscal *2024.*

***Eclipse Term Loan***

On *June 12, 2024,* the Company and certain of its subsidiaries entered into Eclipse Amendment *No. 5,* which provided for among other things, the Eclipse Term Loan and the Eclipse Revolving Loan described further in *Note *10* - Revolving Credit Facility*. The Eclipse Term Loan consists of a principal amount of $13.0 million, at an interest rate of SOFR plus 7.0%, with a four-year term maturing on *June 12, 2028,* and a straight-line loan amortization period of seven years, which would provide for a loan balance at the end of the four-year term of $5.6 million to be repaid on *June 12, 2028,* the maturity date. The Company used the proceeds of the Eclipse Term Loan and a portion of the proceeds from warrant exercises described below to repay in full the Avenue Capital loan. The effective interest rate on the Eclipse Term Loan was 12.4% as of *June 30, 2024.*

In the event that, for any reason, all or any portion of the Eclipse Agreement is terminated prior to the scheduled maturity date, in addition to the payment of all outstanding principal and unpaid accrued interest, the Company is required to pay a fee equal to (i) 3.0% of the Eclipse Term Loan if such event occurs on or before *June 12, 2025, (*ii) 2.0% of the Eclipse Term Loan if such event occurs after *June 12, 2025,* but on or before *June 12, 2026, (*iii) 1.0% of the Eclipse Term Loan if such event occurs after *June 12, 2026,* but on or before *June 12, 2027,* and (iv) 0.5% of the Eclipse Term Loan if such event occurs after *June 12, 2026,* but on or before *June 12, 2028.* The Company *may* also be required to pay an early termination fee related to the Eclipse Revolving Loan as further described in *Note *10* - Revolving Credit Facility*. The Company *may* permanently terminate the Eclipse Agreement upon written notice to Eclipse. The Company's obligations under the Eclipse Agreement are secured by substantially all of the Company's assets, as further defined in the Eclipse Agreement.

The Eclipse Agreement contains customary affirmative covenants, negative covenants and events of default, as defined in the agreement, including covenants and restrictions that, among other things, require the Company to satisfy certain capital expenditure limitations and other financial covenants, and restricts the Company's ability to incur liens, incur additional indebtedness, make certain dividends and distributions with respect to equity securities, engage in mergers and acquisitions or make certain asset sales without the prior written consent of the Eclipse Lender. A failure to comply with these covenants could permit the Eclipse Lender to declare the Company's obligations under the agreement, together with accrued interest and fees, to be immediately due and payable, plus any applicable additional amounts relating to a prepayment or termination, as described above. As of *June 30, 2024,* the Company was in compliance with the covenants under the Eclipse Agreement.

The Company recorded total debt discount and allocated debt issuance costs of $0.3 million related to the Eclipse Term Loan, which will be amortized over the term of the loan. The Company incurred interest expense on the Eclipse Term Loan, including debt discount and issuance costs amortization, of $0.1 million for the year ended *June 30, 2024.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *26*

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Long-term debt consists of the following:

---

| | | |
|:---|:---|:---|
|  | **June 30,**  | **June 30,**  |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Term loan principal amount | $13000 | $15000 |
| Unamortized debt discount and issuance costs | (266) | (925) |
| Final payment fee |  | 638 |
| Financing leases |  | 85 |
| Total debt | 12734 | 14798 |
| Less: current portion of debt | (1857) | (85) |
| Total debt, net of current portion | $10877 | $14713 |

---

Future principal payments of long-term debt are as follows:

---

| | |
|:---|:---|
|  | **June 30,**  |
|  | **(in thousands)** |
| 2025 | $1857 |
| 2026 | 1857 |
| 2027 | 1857 |
| 2028 | 7429 |
| Total future term loan principal payments | 13000 |
| Less: unamortized debt discount and issuance costs | (266) |
| Less: current portion of debt | (1857) |
| Total debt, net of current portion | $10877 |

---

**Note *12* - Fair Value Measurements**

The Company determines the fair value of financial and non-financial assets using the fair value hierarchy, which establishes *three* levels of inputs that *may* be used to measure fair value as follows:

---

| | |
|:---|:---|
| Level *1:* | Inputs that reflect unadjusted quoted prices in active markets that are accessible to Aytu for identical assets or liabilities; |

---

---

| | |
|:---|:---|
| Level *2:* | Inputs include quoted prices for similar assets and liabilities in active or inactive markets or that are observable for the asset or liability either directly or indirectly; and |

---

---

| | |
|:---|:---|
| Level *3:* | Unobservable inputs that are supported by little or *no* market activity. |

---

The Company's financial instruments include cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, derivative warrant liabilities, contingent consideration liabilities, fixed payment arrangements, and current and non-current debt. The carrying amounts of certain short-term financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair value due to their short maturities. Current and non-current debt are reported at their amortized costs on the Company's consolidated balance sheets. The remaining financial instruments are reported on the Company's consolidated balance sheets at amounts that approximate current fair values. The Company's policy is to recognize transfers in and/or out of fair value hierarchy as of the date in which the event or change in circumstances caused the transfer. There were *no* transfers between Level *1,* Level *2* and Level *3* in the periods presented.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *27*

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***Recurring Fair Value Measurement***

The following table presents the Company's financial assets and liabilities that were accounted for at fair value on a recurring basis as of *June 30, 2024,* and *2023,* by level within the fair value hierarchy:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fair Value** <br> **at**  | **Fair Value Measurements at June 30, 2024** | **Fair Value Measurements at June 30, 2024** | **Fair Value Measurements at June 30, 2024** |
|  | **June 30, 2024** | **(Level 1)** | **(Level 2)** | **(Level 3)** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** | **(in thousands)** |
| Liabilities: |  |  |  |  |
| Derivative warrant liabilities | $12745 | $— | $— | $12745 |
| Total | $12745 | $— | $— | $12745 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fair Value**<br> **at**  | **Fair Value Measurements at June 30, 2023** | **Fair Value Measurements at June 30, 2023** | **Fair Value Measurements at June 30, 2023** |
|  | **June 30, 2023** | **(Level 1)** | **(Level 2)** | **(Level 3)** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** | **(in thousands)** |
| Liabilities: |  |  |  |  |
| Derivative warrant liabilities | $6403 | $— | $— | $6403 |
| Total | $6403 | $— | $— | $6403 |

---

Cash and cash equivalents in the consolidated balance sheets include bank deposits and money market funds and reflect their fair value at Level *1* in the fair value hierarchy.

***Non-Recurring Fair Value Measurement***

The Company's financial assets and liabilities that were accounted for at fair value on a non-recurring basis during the years ended *June 30, 2024,* and *2023,* were fixed payment arrangements and intangible assets.

Fixed payment arrangements are recognized at their amortized cost basis using market appropriate discount rates and are accreted up to their notional face value over time. Significant assumptions used in valuing the fixed payment arrangements were discount rates from 10.0% to 15.4% and are classified as Level *3* inputs in the fair value hierarchy. In *May 2022,* the Company recognized a fixed payment arrangement liability of $7.6 million relating to the termination of the Tuzistra License Agreement. See *Note *9* - Other Liabilities* for further information on fixed payment arrangements.

Based on the Company's impairment analyses for fiscal *2024* and *2023,* the Company did not record an impairment charge on intangible assets during the year ended *June 30, 2024,* and recorded an impairment charge of $5.6 million on intangible assets for the year ended *June 30, 2023.* Valuation of intangible assets involves significant Level *3* inputs in estimating their fair values. These input assumptions included revenue growth rates, forecasted earnings before interest, taxes, depreciation, and amortization margins, and the selection of a discount rate. These assumptions *may* be affected by expectations about future market or economic conditions. See *Note *7* - Intangible Assets* and *Note *2* - Summary of Significant Accounting Policies*, for further discussion on the fair value measurement of intangible assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *28*

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***Summary of Level *3* Input Changes***

The following table sets forth a summary of changes to those fair value measures using Level *3* inputs for the year ended *June 30, 2024:*

---

| | |
|:---|:---|
|  | **Derivative Warrant** |
|  | **Liabilities** |
|  | **(in thousands)** |
| Balance as of June 30, 2022 | $1796 |
| Issued | 10998 |
| Settlements |  |
| Included in earnings | (6391) |
| Balance as of June 30, 2023 | 6403 |
| Issued <sup>(1)</sup> | 5148 |
| Settlements <sup>(1)</sup> | (2810) |
| Included in earnings | 4004 |
| Balance as of June 30, 2024 | $12745 |

---

<sup>(*1*)</sup> Primarily relates to warrants to purchase 2,173,912 common shares issued with the Company's *June 2023* equity financing that were exercised in *June 2024.* The warrants were converted into 367,478 shares of common stock ("Settlements") and 1,806,434 pre-funded warrants to purchase shares of common stock with an exercise price of $0.0001 per share ("Issued"). See *Note *14* - Stockholders*' *Equity* and *Note *16* - Warrants* for further detail.

*Level *3* Inputs*

Significant assumptions as of *June 30, 2024,* used in valuing the derivative warrant liabilities, marked to market, were as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **June 2023** <br> **Warrants** | **Warrants** | **Warrants** | **Warrants** | **Warrants** |
|  | **Tranche A** | **Other <sup>(1)</sup>** | **Other <sup>(1)</sup>** | **Other <sup>(1)</sup>** | **Other <sup>(1)</sup>** |
|  | *Monte Carlo* <br> *& Black-Scholes*  | *Black-Scholes*  | *Black-Scholes*  | *Black-Scholes*  | *Black-Scholes*  |
| Aytu closing stock price | $2.92 | $| *2.92* | *2.92* | *2.92* |
| Equivalent term (years) | 3.9 |  | 2.6 | *-* | 3.2 |
| Expected volatility | 80.3% |  | 83.2% | *-* | 87.5% |
| Risk-free rate | 4.4% |  | 4.5% | *-* | 4.6% |
| Dividend yield | 0% |  |  | 0% |  |

---

------

<sup>(*1*)</sup> Includes *August 2022* Warrants, *March 2022* Warrants, Avenue Capital Warrants and Tranche B Pre-Funded Warrants. See *Note *16* - Warrants* for definitions of these terms and further information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *29*

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**Note *13* - Income Taxes**

For fiscal *2024,* there was $2.1 million of income tax expense from continuing operations, which was an effective tax rate of negative 20.6%. This was primarily driven by Section *382* limitation of the IRC on post-Tax Cuts and Jobs Act ("TCJA") net operating loss ("NOL") utilization, as further described below, coupled with existing valuation allowances. As of *June 30, 2024,* the Company had $0.8 million of deferred tax assets ("DTAs"), net of valuation allowance from continuing operations, included in other non-current assets; $0.8 million of deferred tax liabilities ("DTLs") from continuing operations included in other non-current liabilities; and $0.3 million of accrued income taxes payable included in accrued liabilities in the consolidated balance sheets.

For fiscal *2023,* there was $0.3 million of income tax expense from continuing operations with an effective tax rate of negative 3.6%, primarily due to a full valuation allowance. This income tax expense was primarily driven by the limitations on losses as a result of Section *382* of the IRC changes in ownership coupled with existing valuation allowances and release of the naked credit. As of *June 30, 2023,* the Company had $1.4 million of DTAs, net of valuation allowance from continuing operations, included in other non-current assets; $1.4 million of DTLs from continuing operations included in other non-current liabilities; and $0.1 million of accrued income taxes payable included in accrued liabilities in the consolidated balance sheets.

***Section *382* Limitation***

Under the provisions of the IRC, substantial changes in the Company's ownership have resulted in limitations on the amount of NOL carryforwards that can be utilized in future years. NOL carryforwards are subject to examination in the year they are utilized regardless of whether the tax year in which they are generated has been closed by statute. The amount subject to disallowance is limited to the NOL utilized. Accordingly, the Company *may* be subject to examination for prior NOLs generated as such NOLs are utilized.

As part of the Company's Section *382* analysis, an ownership change was determined to have occurred in *March 2022* at a point in time when the Company had a net unrealized built-in gain. As such, the NOL generated during that period has been allocated and the post-change NOL (approximately $12 million) was determined to be fully available to offset fiscal *2023* pre-change income subject to the *80%* limitation. The Company also determined that an ownership change occurred in *June 2023* at a time when the Company was in a net unrealized built-in loss position. As a result of the Section *382* analysis, the Company had $0.3 million of disallowed recognized built-in loss that was carried forward as a net operating loss as of *June 30, 2023.* For fiscal *2024,* an additional $8.8 million of disallowed recognized built-in loss was carried forward as an operating loss. These operating loss carryovers are subject to the *June 2023* Section *382* limitation.

The Company had federal net operating losses of $519.6 million as of *June 30, 2024,* that is subject to limitation (as described above). Of the available federal net operating losses, $186.6 million can be carried forward indefinitely, and $333.0 million will completely expire in *2037.* Of the amount set to expire, $329.2 million will expire unused as a result of the ownership change. As of *June 30, 2024,* the Company had research and development credits of $3.0 million, which will begin to expire in *2025* and are also subject to Section *382* limitation. The available state net operating losses, if *not* utilized to offset taxable income in future periods, will begin to expire in *2025* and will completely expire in *2039.*

As of *June 30, 2024,* the Company had various state NOL carryforwards. The determination of the state NOL carryforwards is dependent on apportionment percentages and state laws that can change from year to year and impact the amount of such carryforwards.

The Company notes there is diversity in practice regarding the treatment of deductions or loss carryforwards that are expected to expire unutilized. Generally, it is *not* appropriate to use *zero* as an applicable tax rate and rather, a DTA should be recorded at the applicable tax rate and a valuation of an equal amount would be provided. However, under certain circumstances it *may* be appropriate to follow an alternative approach and use a *zero* rate to write off the asset against the valuation allowance, reducing the valuation allowance and gross DTAs disclosed. The Company considered both accounting viewpoints and determined it would present its NOL carryforwards gross with a full valuation allowance and *not* apply a *zero* rate to NOL carryforwards expected to expire unutilized.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *30*

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In review of the Company's consolidated deferred position, excluding NOLs and other tax attributes, the Company is in a net DTA position and therefore all NOLs are being fully valued and *not* utilized against a net DTL.

The provision for income taxes consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **Year Ended June 30,** | **Year Ended June 30,** |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Current: |  |  |
| Federal | $1886 | $333 |
| State | 256 | 56 |
| Total current tax expense | 2142 | 389 |
| Deferred: |  |  |
| Federal |  | (109) |
| State |  | (17) |
| Total deferred tax expense |  | (126) |
| Provision for income taxes | $2142 | $263 |

---

Income tax expense resulting from applying statutory rates in jurisdictions in which the Company is taxed (federal and various states) differs from the income tax expense in the consolidated financial statements. A reconciliation of the United States federal statutory income tax rates to the Company's effective tax rate is as follows.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year Ended June 30,** | **Year Ended June 30,** | **Year Ended June 30,** | **Year Ended June 30,** |
|  | **2024** | **2024** | **2023** | **2023** |
|  | **(in thousands, except tax rate)** | **(in thousands, except tax rate)** | **(in thousands, except tax rate)** | **(in thousands, except tax rate)** |
| Tax at statutory rate | $(2179) | 21.0% | $(1531) | 21.0% |
| State income taxes, net of federal benefit | (906) | 8.7% | (1427) | 19.6% |
| Stock-based compensation expense | 19 | (0.2)% |  | —% |
| Contingent consideration |  | —% | (121) | 1.7% |
| Change in valuation allowance | 5172 | (49.8)% | 3225 | (44.2)% |
| Other | 36 | (0.3)% | 117 | (1.6)% |
| Net income tax expense | $2142 | (20.6)% | $263 | (3.6)% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *31*

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Deferred income taxes arise from temporary differences in the recognition of certain items for income tax and financial reporting purposes. The approximate tax effects of significant temporary differences, which comprise the deferred tax assets and liabilities, are as follows:

---

| | | |
|:---|:---|:---|
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Deferred tax assets: |  |  |
| Net operating loss carry forward | $119170 | $113819 |
| Interest | 4845 | 4188 |
| Accrued rebates | 3819 | 6994 |
| Warrant derivatives | 3061 | 1504 |
| Research and development credits | 2416 | 2416 |
| Stock-based compensation expense | 1259 | 4250 |
| Accrued expenses | 1027 | 758 |
| Section 174 capitalization | 780 | 836 |
| Inventory | 256 | 743 |
| Lease liability | 305 | 492 |
| Fixed assets | 99 |  |
| Other | 975 | 1332 |
| Total deferred tax assets | 138012 | 137332 |
| Less: valuation allowance | (137250) | (135954) |
| Deferred tax assets, net of valuation allowance | 762 | 1378 |
| Deferred tax liabilities: |  |  |
| Intangibles | (563) | (845) |
| ROU asset | (199) | (483) |
| Fixed assets |  | (50) |
| Total deferred tax liabilities | (762) | (1378) |
| Net deferred tax liabilities | $— | $— |

---

The Company has recorded a valuation allowance of $137.3 million and $136.0 million at *June 30, 2024,* and *2023,* respectively, to reserve its net DTAs. In assessing the realizability of DTAs, management considers whether it is more likely than *not* that some portion or all of the DTAs will *not* be realized. The ultimate realization of DTAs is dependent upon the generation of future taxable income during periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, carry back opportunities and tax planning strategies in making the assessment. The Company believes it is more likely than *not* that it will realize the benefits of these deductible differences, net of the valuation allowance provided.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *32*

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The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. The Company has *no* accrued interest related to its uncertain tax positions as they all relate to timing differences that would adjust the Company's NOL, interest expense carryover or research and development credit carryover and therefore do *not* require recognition. As a result of these timing differences, at *June 30, 2024,* and *2023* the Company had gross unrecognized tax benefits related to uncertain tax positions of $1.3 million and $2.9 million, respectively. Changes in unrecognized benefits in any given year are recorded as a component of deferred tax expense.

A tabular roll-forward of the Company's gross unrecognized tax benefit related to uncertain tax positions is below.

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| | | |
|:---|:---|:---|
|  | **June 30,**  | **June 30,**  |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Beginning balances | $2948 | $2822 |
| Decrease resulting from current period tax positions | (1996) | (120) |
| Increase resulting from current period tax positions | 361 | 246 |
| Ending balances | $1313 | $2948 |

---

The change in the Company's gross unrecognized tax benefits relates to filed method changes with the IRS for the tax return year ending *June 30, 2023.* Additionally, Neos pre-acquisition tax years are subject to the same general statute of limitations, resulting in its tax years back to 2005 being subject to examination.

The income tax expense (benefit) allocated to continuing operations and discontinued operations for the years ended *June 30, 2024,* and *2023,* were as follows:

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| | | |
|:---|:---|:---|
|  | **Year Ended June 30,** | **Year Ended June 30,** |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Continuing operations income tax expense | $2142 | $263 |
| Discontinued operations income tax benefit | (374) | (263) |
| Total income tax expense | $1768 | $— |

---

See *Note *20* – Discontinued Operations* for further detail on the Company's discontinued operations related to the wind down and divestiture of its Consumer Health business.

**Note *14* - Stockholders**' **Equity**

The Company has 200.0 million shares of common stock authorized with a par value of $0.0001 per share and 50.0 million shares of preferred stock authorized with a par value of $0.0001 per share. As of *June 30, 2024,* and *2023,* the Company had 5,972,638 and 5,517,174 common shares issued and outstanding, respectively, and no preferred shares issued and outstanding. As of *June 30, 2024,* included in common stock outstanding are 25,360 shares of unvested restricted stock issued to executives, directors and employees.

On *June 8, 2020,* the Company filed a shelf registration statement on Form S-*3,* which was declared effective by the SEC on *June 17, 2020.* This shelf registration statement covered the offering, issuance, and sale by the Company of up to an aggregate of $100.0 million of its common stock, preferred stock, debt securities, warrants, rights and units. On *June 4, 2021,* the Company entered into a sales agreement with a sales agent, to provide for the offering, issuance and sale by the Company of up to $30.0 million of its common stock from time to time in "at-the-market" offerings under the *2020* Shelf (the "ATM Sales Agreement"). During the year ended *June 30, 2023,* the Company issued 699,929 shares of common stock under the ATM Sales Agreement, with total net proceeds of $2.9 million. The *2020* Shelf expired in *June 2023* and the ATM Agreement was terminated in *July 2023.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *33*

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On *September 28, 2021,* the Company filed a shelf registration statement on Form S-*3,* which was declared effective by the SEC on *October 7, 2021.* This shelf registration statement covered the offering, issuance and sale by the Company of up to an aggregate of $100.0 million of its common stock, preferred stock, debt securities, warrants, rights and units (the *"2021* Shelf"). As of *June 30, 2024,* $82.4 million remained available under the *2021* Shelf. This availability is subject to SEC *1.B.6* limitation to the Form S-*3.* The *2021* Shelf expires in *October 2024.* Given the upcoming expiration of the *2021* Shelf, concurrent with the filing of this Form *10*-K the Company expects to file a new shelf registration statement to cover the offering, issuance and sale by the Company of up to an aggregate of $100.0 million of its common stock, preferred stock, debt securities, warrants, rights and units (the *"2024* Shelf").

On *March 7, 2022,* the Company closed on an underwritten public offering utilizing the *2021* Shelf, pursuant to which, the Company sold, (i) 151,500 shares of the Company's common stock, (ii) pre-funded warrants to purchase up to 151,500 shares of common stock, and (iii) common stock purchase warrants to purchase up to 333,300 shares of common stock (the *"March 2022* Offering"). The shares of common stock and the pre-funded warrants were each sold in combination with corresponding common warrants, with *one* common warrant to purchase 1.1 shares of common stock for each share of common stock or each pre-funded warrant sold. The pre-funded warrants have an exercise price of $0.002 per share of common stock and were exercised in full in *April 2022.* The common warrants have an exercise price of $26.00 per share of common stock and are exercisable six months after the date of issuance and have a term of five years from the date of exercisability. The Company raised gross proceeds of $7.6 million through the *March 2022* Offering before commission and other costs of $0.8 million. The pre-funded and common warrants have a combined fair value of approximately $2.8 million at issuance and are classified as derivative warrant liabilities with the offset in additional paid in capital in stockholders' equity in the Company's consolidated financial statements (see *Note *16* - Warrants*).

On *August 11, 2022,* the Company closed on an underwritten public offering (the *"August 2022* Offering") utilizing the *2021* Shelf, pursuant to which it sold an aggregate of (i) 1,075,290 shares of its common stock; (ii) in lieu of common stock to certain investors that so chose, pre-funded warrants to purchase 87,500 shares of its common stock; and (iii) accompanying warrants to purchase 1,265,547 shares of its common stock. The shares of common stock and the pre-funded warrants were each sold in combination with corresponding common warrants, with one common warrant to purchase *one* share of common stock for each share of common stock or each pre-funded warrant sold. The combined public offering price for each share of common stock and accompanying common warrant was $8.60, and the combined offering price for each pre-funded warrant and accompanying common warrant was $8.58, which equated to the public offering price per share of the common stock and accompanying common warrant, less the $0.02 per share exercise price of each pre-funded warrant. The pre-funded warrants were exercised in full in *August 2022.* The common warrants have an exercise price of $8.60 per share of common stock and are exercisable for a period of five years from issuance. The Company raised $10.0 million in gross proceeds through the *August 2022* Offering before underwriting fees and other expenses of $0.9 million. The pre-funded and common warrants had a combined fair value of approximately $6.0 million at issuance and are classified as derivative warrant liabilities, with the offset in additional paid in capital in stockholders' equity in the Company's consolidated financial statements (see *Note *16* - Warrants*).

On *June 8, 2023,* using a placement agent, the Company entered into a securities purchase agreement (the "Securities Purchase Agreement") with certain institutional investors, pursuant to which the Company issued and sold an aggregate of (i) 1,743,695 shares of the Company's common stock; (ii) pre-funded warrants in lieu of shares to purchase 430,217 shares of common stock (the *"June 2023* Pre-Funded Warrants"); (iii) accompanying tranche A warrants to purchase 2,173,912 shares of common stock (the "Tranche A Warrants"); and (iv) accompanying tranche B warrants to purchase 2,173,912 shares of common stock in a best-efforts offering (the "Tranche B Warrants" and the Tranche A Warrants together with the Tranche B Warrants, the "Common Warrants"). The Common Warrants *may* be exercised for either shares of common stock or pre-funded warrants to purchase common stock at a future exercise price of $0.0001 per share in the same form as the *June 2023* Pre-Funded Warrants (the "Exchange Warrants"). Each pre-funded warrant is exercisable for one share of common stock at an exercise price of $0.0001 per share. The pre-funded warrants are immediately exercisable and *may* be exercised at any time until all of the pre-funded warrants are exercised in full. The Common Warrants are immediately exercisable at a price of $1.59 per share (or $1.5899 per Exchange Warrant). The Tranche A Warrants will expire upon the earlier of (i) five years after the date of issuance or (ii) 30 days following the closing price of the Company's common stock equaling 200% of the exercise price ($3.18 per share) for at least 40 consecutive trading days. The Tranche B Warrants were exercised in *June 2024* as further described below. The Company raised $4.0 million in gross proceeds and net proceeds were $3.4 million after deducting offering expenses. The *June 2023* Pre-Funded Warrants do *not* have an expiration date. The warrants had a combined fair value of approximately $5.0 million at issuance and are classified as derivative warrant liabilities. The resulting offset is recorded in derivative warrant liabilities (loss) gain along with the issuance costs of $0.6 million in the consolidated financial statement of operations (see *Note *16* - Warrants*).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *34*

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On *June 14, 2024,* the Tranche B Warrants were exercised, generating proceeds of $3.5 million. The Tranche B Warrants were converted into 367,478 shares of common stock and 1,806,434 pre-funded warrants to purchase shares of common stock with an exercise price of $0.0001 per share (the "Tranche B Pre-Funded Warrants"). The Tranche B Pre-Funded Warrants had a fair value of approximately $5.1 million at issuance and are classified as derivative warrant liabilities, with the offset in additional paid in capital in stockholders' equity in the Company's consolidated financial statements. The Company used a portion of the proceeds from the Tranche B Warrants exercise as part of the Avenue Capital loan repayment described further in *Note *11* - Long-Term Debt*.

**Note *15* - Equity Incentive Plans**

***2023* Equity Incentive Plan***

On *May 18, 2023,* the Company's stockholders approved the Aytu BioPharma, Inc. *2023* Equity Incentive Plan (the *"2023* Equity Incentive Plan"). Prior to the Company's adoption of the *2023* Equity Incentive Plan, the Company awarded equity incentive grants to its directors and employees under the Aytu BioScience, Inc. *2015* Stock Option and Incentive Plan (the "Aytu *2015* Plan") and the Neos Therapeutics, Inc. *2015* Stock Options and Incentive Plan (the "Neos *2015* Plan", and collectively with the Aytu *2015* Plan, the *"2015* Plans"). For the *2023* Equity Incentive Plan, the stockholders approved (i) 200,000 new shares; (ii) 87,129 shares available for grant under the *2015* Plans be "rolled over" to the *2023* Equity Incentive Plan; and (iii) any shares that are returned to the Company under the *2015* Plans be added to the *2023* Equity Incentive Plan. With the approval of the *2023* Equity Incentive Plan, *no* additional awards will be granted under the *2015* Plans. All outstanding awards previously granted under previous stock incentive plans will remain outstanding and subject to the terms of the plans. Stock options granted under the *2023* Equity Incentive Plan have contractual terms of 10 years or less from the grant date and a vesting period ranging from 3 to 4 years. The restricted stock awards and restricted stock units have a vesting period of 3 to 4 years. As of *June 30, 2024,* the Company had 182,322 shares that are available for grant under the *2023* Equity Incentive Plan.

***Aytu *2015* Plan***

On *June 1, 2015,* the Company's stockholders approved the Aytu *2015* Plan, which, as amended in *July 2017,* provides for the award of stock options, stock appreciation rights, restricted stock, and other equity awards. On *February 13, 2020,* the Company's stockholders approved an increase to 250,000 total shares of common stock in the Aytu *2015* Plan. The shares of common stock underlying any awards that are forfeited, canceled, reacquired by Aytu prior to vesting, satisfied without any issuance of stock, expire or are otherwise terminated (other than by exercise) under the Aytu *2015* Plan will be added back to the shares of common stock available for issuance under the *2023* Equity Incentive Plan. Stock options granted under this plan have contractual terms of 10 years from the grant date and a vesting period ranging from 3 to 4 years. The restricted stock awards have a vesting period ranging from 4 to 10 years, and the restricted stock units have a vesting period of 4 years.

***Neos *2015* Plan***

Pursuant to the Neos Acquisition, the Company assumed 3,486 stock options and 1,786 restricted stock units previously granted under the Neos *2015* Plan. Accordingly, on *April 19, 2021,* the Company registered 5,272 shares of its common stock under the Neos *2015* Plan with the SEC. The terms and conditions of the assumed equity securities remained the same as they were previously under the Neos *2015* Plan. The Company allocated costs of the replacement awards attributable to pre-combination and post-combination service periods. The pre-combination service costs were included in the consideration transferred. The remaining costs attributable to the post-combination service period are being recognized as stock-based compensation expense over the remaining terms of the replacement awards. Stock options granted under this plan have contractual terms of 10 years from the grant date and a vesting period ranging from 1 to 4 years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *35*

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***Stock Options***

During the year ended *June 30, 2024,* 113,500 stock options were granted. The weighted-average grant date fair value of options granted during the year ended *June 30, 2024,* was $1.74. During the year ended *June 30, 2024,* there was $0.2 million of total unrecognized compensation cost adjusted for estimated forfeitures, related to non-vested stock options granted under the Company's equity incentive plan. During the fiscal year ended *June 30, 2023,* 49,212 stock options were granted. The weighted-average grant date fair value of options granted during the year ended *June 30, 2023,* was $4.00. During the year ended *June 30, 2023,* there was $0.1 million of total unrecognized compensation cost adjusted for estimated forfeitures, related to non-vested stock options granted under the Company's equity incentive plan. The unrecognized compensation cost is expected to be recognized over a weighted average period of 1.9 years.

Stock option activity is as follows:

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| | | | |
|:---|:---|:---|:---|
|  |  |  | **Weighted** |
|  |  |  | ***Average*** |
|  |  | ***Weighted*** | ***Remaining*** |
|  | ***Number of*** | ***Average*** | ***Contractual*** |
|  | ***Options*** | ***Exercise Price*** | ***Life in Years*** |
| Outstanding at June 30, 2023 | 52762 | $18.37 | 9.1 |
| Granted | 113500 | $1.74 | 9.2 |
| Forfeited/cancelled | (16610) | $3.20 | *—* |
| Expired | (3113) | $66.84 | *—* |
| Outstanding at June 30, 2024 | 146539 | $6.18 | 8.8 |
| Exercisable at June 30, 2024 | 25068 | $26.06 | 8.0 |

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The following table details the options outstanding at *June 30, 2024,* by range of exercise prices:

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  |  |  |  |  | **Weighted** |  |  |
|  |  |  |  |  | ***Average*** |  |  |
|  |  |  |  |  | ***Remaining*** |  |  |
|  |  |  |  | ***Weighted*** | ***Contractual*** |  |  |
| ***Range of*** | ***Range of*** | ***Range of*** | ***Number of*** | ***Average*** | ***Life of*** | ***Number of***  | ***Weighted*** |
| ***Exercise*** | ***Exercise*** | ***Exercise*** | ***Options*** | ***Exercise*** | ***Options*** | ***Options*** | ***Average*** |
| ***Prices*** | ***Prices*** | ***Prices*** | ***Outstanding*** | ***Price*** | ***Outstanding*** | ***Exercisable*** | ***Exercise Price*** |
|  | $1.73 |  | 102000 | $1.73 | 9.1 |  | $— |
|  | $2.53 |  | 1500 | $2.53 | 9.6 |  | $— |
| $4.00 |  | $290.00 | 43039 | $16.85 | 8.1 | 25068 | $225.74 |
|  |  |  | 146539 | $6.18 | 8.8 | 25068 | $225.74 |

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***Restricted Stock***

During the year ended *June 30, 2024,* the Company granted a total of 12,500 shares of restricted stock, with certain accelerated vesting conditions, to members of its non-employee directors pursuant to the *2023* Equity Incentive Plan, of which 1/3 vest on the grant date and 1/12 on the *first* day of each quarter thereafter, subject to continuing service to the Company through each vesting date. These restricted stock grants have a weighted average grant date fair value of $1.77 per share.

During the year ended *June 30, 2023,* as a result of the change in members of the Company's board, the Company accelerated unvested shares for *two* former members and recorded $1.5 million of non-cash equity compensation expense.

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On *December 19, 2022,* the Company entered into a stipulation of compromise and settlement (the "Stipulation"). As a part of the terms of the Stipulation, the Company agreed to rescind 25% of the aggregate *2021* grants to board members. As a result of the recission of the shares, the Company recorded $0.6 million in non-cash compensation during the year ended *June 30, 2023.*

During the year ended *June 30, 2023,* the Company granted a total of 6,825 shares of restricted stock, with certain accelerated vesting conditions, to members of its management team pursuant to the Aytu *2015* Plan, of which 1/3 vest on the grant date and 1/12 on the *first* day of each quarter thereafter, subject to continuing employment with the Company through each vesting date. These restricted stock grants have a grant date fair value ranging from $3.31 per-share to $13.4 per-share.

Restricted stock activity under the *2023* Equity Incentive Plan is as follows:

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| | | |
|:---|:---|:---|
|  |  | **Weighted** |
|  |  | **Average Grant** |
|  | ***Number of*** | ***Date Fair*** |
|  | ***Shares*** | ***Value*** |
| Unvested at June 30, 2023 | 38075 | $142.20 |
| Granted | 12500 | $1.77 |
| Vested | (25971) | $113.37 |
| Forfeited/cancelled | (499) | $147.15 |
| Unvested at June 30, 2024 | 24105 | $100.34 |

---

As of *June 30, 2024,* there was $1.0 million of total unrecognized compensation costs adjusted for estimated forfeitures, related to non-vested restricted stock granted under the Company's equity incentive plan. The unrecognized compensation cost is expected to be recognized over a weighted average period of 2.5 years. The total fair value of restricted stock vested during the year ended *June 30, 2024,* was $0.1 million.

The Company previously issued 4 shares of restricted stock outside of the Aytu *2015* Plan, which vest in *July 2026.* On *January 17, 2022,* the Company granted 5,000 shares of restricted stock to a member of its management team outside of the Aytu *2015* Plan, of which 1/3 vest on *January 17, 2023,* and 1/12 each quarter thereafter, subject to continuing employment with the Company through each vesting date until *January 17, 2025.* This restricted stock grant has a grant date fair value of $27.00 per share. As of *June 30, 2024,* there was $0.2 million total unrecognized costs adjusted for estimated forfeitures, related to non-vested restricted stock outside of the Company's equity incentive plan. The unrecognized compensation cost is expected to be recognized over a weighted average period of 0.6 years.

***Restricted Stock Units***

For the years ended *June 30, 2024,* and *2023,* the Company did not grant restricted stock units ("RSU"). RSU activity is as follows:

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| | | |
|:---|:---|:---|
|  |  | **Weighted** |
|  |  | **Average Grant** |
|  | ***Number of*** | ***Date Fair*** |
|  | ***Shares*** | ***Value*** |
| Unvested at June 30, 2023 | 4963 | $25.62 |
| Vested | (2249) | $24.28 |
| Forfeited/cancelled | (939) | $31.60 |
| Unvested at June 30, 2024 | 1775 | $24.14 |

---

As of *June 30, 2024,* there was no material unrecognized compensation costs adjusted for estimated forfeitures, related to non-vested RSUs granted under the Company's equity incentive plans. The unrecognized compensation cost is expected to be recognized over a weighted average period of 0.7 years. The total fair value of RSUs vested during the year ended *June 30, 2024,* was immaterial.

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Stock-based compensation expense from continuing operations related to the fair value of stock options, restricted stock and RSUs was included in the consolidated statements of operations as set forth in the below table:

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| | | |
|:---|:---|:---|
|  | **Year Ended** | **Year Ended** |
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Cost of sales | $2 | $28 |
| Research and development | 6 | 30 |
| Selling and marketing |  | 23 |
| General and administrative | 2365 | 5641 |
| Total stock-based compensation expense | $2373 | $5722 |

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**Note *16* - Warrants**

***Liability Classified Warrants***

The Company accounts for liability classified warrants by recording the fair value of each instrument in its entirety and recording the fair value of the warrant derivative liability. The fair value of liability classified derivative financial instruments was calculated using either the Black-Scholes option pricing model or the Monte Carlo simulation model and is revalued every quarter. Changes in the fair value of liability classified derivative financial instruments in subsequent periods are recorded as unrealized derivative gain or loss in the consolidated statements of operations.

On *June 8, 2023,* using a placement agent, the Company entered into a securities purchase agreement (the "Securities Purchase Agreement") with certain institutional investors, pursuant to which the Company issued and sold an aggregate of (i) 1,743,695 shares of the Company's common stock; (ii) *June 2023* Pre-Funded Warrants in lieu of shares to purchase 430,217 shares of common stock; (iii) accompanying Tranche A Warrants to purchase 2,173,912 shares of common stock; and (iv) accompanying Tranche B Warrants to purchase 2,173,912 shares of common stock in a best-efforts offering (the Tranche A Warrants together with the Tranche B Warrants, the "Common Warrants"). The Common Warrants *may* be exercised for either shares of common stock or pre-funded warrants to purchase common stock at a future exercise price of $0.0001 per share in the same form as the *June 2023* Pre-Funded Warrants (the "Exchange Warrants"). Each pre-funded warrant is exercisable for one share of common stock at an exercise price of $0.0001 per share. The pre-funded warrants are immediately exercisable and *may* be exercised at any time until all of the pre-funded warrants are exercised in full. The Common Warrants are immediately exercisable at a price of $1.59 per share (or $1.5899 per Exchange Warrant). The Tranche A Warrants will expire upon the earlier of (i) five years after the date of issuance or (ii) 30 days following the closing price of the Company's common stock equaling 200% of the exercise price ($3.18 per share) for at least 40 consecutive trading days. The Tranche B Warrants were exercised in *June 2024* as further described below. The Company raised $4.0 million in gross proceeds and net proceeds were $3.4 million after deducting offering expenses. The *June 2023* Pre-Funded Warrants do *not* have an expiration date. The warrants had a combined fair value of approximately $5.0 million at issuance and are classified as derivative warrant liabilities. The resulting offset is recorded in derivative warrant liabilities (loss) gain along with the issuance costs of $0.6 million in the consolidated financial statement of operations (see *Note *14* - Stockholders*' *Equity*).

On *June 14, 2024,* the Tranche B Warrants were exercised, generating proceeds of $3.5 million. The Tranche B Warrants were converted into 367,478 shares of common stock and 1,806,434 Tranche B Pre-Funded Warrants to purchase shares of common stock with an exercise price of $0.0001 per share. The Tranche B Pre-Funded Warrants, which do *not* have an expiration date, had a fair value of approximately $5.1 million at issuance and are classified as derivative warrant liabilities, with the offset in additional paid in capital in stockholders' equity in the Company's consolidated financial statements. The Company used a portion of the proceeds from the Tranche B Warrants exercise as part of the Avenue Capital loan repayment described further in *Note *11* - Long-Term Debt*.

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On *August 11, 2022,* the Company closed on the *August 2022* Offering, pursuant to which, the Company issued pre-funded warrants to purchase 87,500 shares of its common stock and common warrants to purchase 1,265,547 shares of its common stock. The shares of common stock and the pre-funded warrants were each sold in combination with corresponding common warrants, which *one* common warrant to purchase one share of common stock for each share of common stock or each pre-funded warrant sold. The pre-funded warrants had an exercise price of $0.02 per share of common stock and were exercised in full in *August 2022.* The common warrants have an exercise price of $8.60 per share of common stock and are exercisable for a period of five years from issuance. The common warrants provide that if there occurs any a stock split, stock dividend stock recapitalization, or similar event (a "Stock Combination Event"), then the warrant exercise price will be adjusted to the greater of the quotient determined by dividing (*x*) the sum of the VWAP of the common stock for each of the five lowest trading days during the 20 consecutive trading day period ending immediately preceding the 16th trading day after such Stock Combination Event, divided by (y) five; or $2.32 and the number of shares of common stock to be issued would be adjusted proportionately as set forth in the agreement limited to a maximum of 2,325,581 shares. The common warrants also provide that in the event the Company were to engage in an equity offering at a common stock price lower than the warrant exercise price prior to the *second* anniversary of a Stock Combination Event, the exercise price would be adjusted to the greater of the effective price of such equity offering or $2.32 (see *Note *14* - Stockholders*' *Equity*).

In *November 2022* and throughout the quarter ended *December 31, 2022,* the Company sold shares through its ATM Sales Agreement. Per the warrant agreement in the *August 2022* Offering, these sales qualified as an equity offering and the sales price was less than the current exercise price of $8.60. As a result, the associated common warrants exercise price was adjusted to $3.30. On *January 6, 2023,* the Company consummated a 20 to *1* reverse stock split. Pursuant to the aforementioned warrant agreement, the Company triggered a Stock Combination Event and the warrant exercise price and number to be issued was adjusted based on the average of each of the lowest five trading days during the twenty-day consecutive trading day period beginning on *December 30, 2022.* Subsequently, as a result of the Securities Purchase Agreement in *June 2023,* the common warrants from the *August 2022* Offering had an adjusted exercise price of $2.32.

On *March 7, 2022,* the Company closed on an underwriting agreement, pursuant to which, the Company sold, (i) 151,500 shares of the Company's common stock, (ii) pre-funded warrants to purchase up to 151,500 shares of common stock, and (iii) common warrants to purchase up to 333,300 shares of common stock. The shares of common stock and the pre-funded warrants were each sold in combination with corresponding common warrants, with *one* common warrant to purchase 1.1 shares of common stock for each share of common stock or each pre-funded warrant sold. The pre-funded warrants have an exercise price of $0.002 per share of common stock and were exercised in full in *April 2022.* The common warrants have an exercise price of $26.00 per share of common stock and are exercisable six months after the date of issuance and have a term of five years from the date of exercisability (see *Note *14* - Stockholders*' *Equity*).

On *January 26, 2022,* as consideration for entering into the Avenue Capital Agreement as described in *Note *11** – *Long-Term Debt*, the Company issued warrants to the Avenue Capital Lenders to purchase shares of common stock at an exercise price equal to $24.20 per share (the "Avenue Capital Warrants"). The Avenue Capital Warrants provided that in the event the Company were to engage in an equity offering at a price lower than $24.20 prior to *June 30, 2022,* the exercise price would be adjusted to the effective price of such equity offering and the number of shares of common stock to be issued under the Avenue Capital Warrants would be adjusted as set forth in the agreement. The Avenue Capital Warrants were immediately exercisable and expire on *January 31, 2027.* At inception, the Company accounted for the Avenue Capital Warrants as a derivative warrant liability as the number of warrants was *not* fixed at the issuance (see *Note *11** – *Long-Term Debt* for further details).

Outstanding warrants that are classified as derivative warrant liabilities in the consolidated balance sheets are marked to market at each reporting period (see *Note *12** – *Fair Value Considerations*).

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A summary of warrants is as follows:

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| | | | |
|:---|:---|:---|:---|
|  |  |  | **Weighted** |
|  |  |  | **Average** |
|  |  | ***Weighted*** | ***Remaining*** |
|  | ***Number of*** | ***Average*** | ***Contractual*** |
|  | ***Warrants*** | ***Exercise Price*** | **Life in Years <sup>(4)</sup>** |
| Outstanding June 30, 2023 <sup>(1)</sup> | 6538052 | $4.42 | 4.7 |
| Warrants issued <sup>(2)</sup> | 1806434 | $0.0001 | *N/A* |
| Warrants exercised | (2247648) | $1.61 | *—* |
| Warrants expired | (20958) | $300.00 | *—* |
| Outstanding June 30, 2024 <sup>(3)</sup> | 6075880 | $3.71 | 3.1 |

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<sup>(*1*)</sup> The number of warrants outstanding as of *June 30, 2023,* is comprised of 6,068,763 liability classified warrants, 430,217 liability classified *June 2023* Pre-Funded Warrants and 39,072 equity classified warrants.

<sup>(*2*)</sup> The warrants issued during fiscal *2024* were a result of 1,806,434 Tranche B Warrants being exercise to 1,806,434 Tranche B Pre-Funded Warrants.

<sup>(*3*)</sup> The number of warrants outstanding as of *June 30, 2024,* is comprised of 3,821,115 liability classified warrants, 430,217 liability classified *June 2023* Pre-Funded Warrants, 1,806,434 liability classified Tranche B Pre-Funded Warrants and 18,114 equity classified warrants.

<sup>(*4*)</sup> As pre-funded warrants do *not* have an expiration date, they have been excluded from the calculation of the weighted average remaining contractual life in years.

**Note *17* - Restructuring Costs**

As part of the Company's previously announced restructuring activities related to the wind down and divestiture of the Consumer Health business and the closure of the Grand Prairie, Texas manufacturing site, the Company has incurred expenses that qualify as exit and disposal costs under U.S. GAAP. These include severance and employee benefit costs as well as other direct separation benefit costs, right of use asset impairment charges, fixed asset and other asset impairment charges, accelerated depreciation of fixed assets, contract termination costs, and inventory write-downs. Severance and employee benefit costs primarily relate to cash severance. Restructuring costs associated with the Consumer Health business are recorded within the net loss from discontinued operations, net of tax in the consolidated financial statement of operations (see *Note *20* - Discontinued Operations*).

The expense associated with the closure of the Grand Prairie, Texas manufacturing site such as severance and employee benefits and exit and disposal activities are included in restructuring costs in the consolidated statements of operations. There have been *no* inventory write-downs associated with this closure. The Company does *not* expect to incur any additional significant restructuring costs related to the closure of the Grand Prairie, Texas manufacturing site during fiscal *2025.* As of *June 30, 2024,* the Company had accrued $0.9 million and $0.4 million related to accrued severance and employee benefits and accrued exit and disposal activity costs, respectively, related to the closure of the Grand Prairie, Texas manufacturing facility.

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A summary of restructuring costs incurred during the year ended *June 30, 2024,* is as follows:

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| | | | |
|:---|:---|:---|:---|
|  | **Year Ended June 30, 2024** | **Year Ended June 30, 2024** | **Year Ended June 30, 2024** |
|  | **Severance and**<br> **Employee** <br> **Benefits <sup>(1)</sup>** | **Exit and** <br> **Disposal** <br> **Activities <sup>(1)</sup>** | **Total** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** |
| Closure of Grand Prairie, Texas manufacturing site | $1125 | $1031 | $2156 |

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<sup>(*1*)</sup> Expense associated with severance and employee benefits and exit and disposal activities are included in restructuring costs in the consolidated statements of operations.

**Note *18* - Commitments and Contingencies**

***Pediatric Portfolio Fixed Payments and Product Milestone***

The Company assumed two fixed, periodic payment obligations to an investor (the "Fixed Obligation"). Under the *first* fixed obligation, the Company was to pay a monthly payment of $0.1 million beginning *November 1, 2019,* through *January 2021,* with a balloon payment of $15.0 million that was to be due in *January 2021* ("Balloon Payment Obligation"). A *second* fixed obligation required the Company pay a minimum of $0.1 million monthly through *February 2026,* except for $0.2 million paid in *January 2020.*

On *May 29, 2020,* the Company entered into an early payment agreement and escrow instruction (the "Early Payment Agreement") pursuant to which the Company agreed to pay $15.0 million to the investor in satisfaction of the Balloon Payment Obligation. The parties to the Early Payment Agreement acknowledged and agreed that the remaining fixed payments other than the Balloon Payment Obligation remained due and payable pursuant to the terms of the agreement, and that nothing in the Early Payment Agreement alters, amends, or waives any provisions or obligations in the waiver or the investor agreement other than as expressly set forth therein. The *first* fixed obligation was fully paid as of *January 2021.*

On *June 21, 2021,* the Company entered into a waiver, release and consent pursuant to which the Company paid $2.8 million to the investor in satisfaction of the *second* fixed obligation. The Company agreed to pay the remaining fixed obligation of $3.0 million in *six* equal quarterly payments of $0.5 million over the next *six* quarters commencing *September 30, 2021.* The Company accounted for the waiver, release and consent as a debt and remeasured the related liabilities using a discounted cash flow model. This fixed payment arrangement was paid in full by *January 2023.*

The Company acquired the Tris Karbinal Agreement, under which the Company is granted the exclusive right to distribute and sell Karbinal in the United States. The initial term of the agreement was 20 years. The Company pays Tris a royalty equal to 23.5% of net revenue from the product.

The Tris Karbinal Agreement also contains minimum unit sales commitments, which is based on a commercial year that spans from *August 1* through *July 31,* of 70,000 units annually through *2025.* The Company is required to pay Tris a royalty make-whole payment of $30 for each unit under the 70,000-unit annual minimum sales commitment through *2025.* The Tris Karbinal Agreement make-whole payment is capped at $2.1 million each year. The annual payment is due in *August* of each year. The Tris Karbinal Agreement also has multiple commercial milestone obligations that aggregate up to $3.0 million based on cumulative net revenue from the product, the *first* of which is triggered at $40.0 million. As of *June 30, 2024,* the fixed payment arrangement balance was $1.9 million in other current liabilities, and $0.2 million in other non-current liabilities on the consolidated balance sheet.

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***Operating Lease***

In *June 2024,* the Company entered into a forward-starting operating lease agreement to lease office space in Berwyn, Pennsylvania from the owner of the office space that the Company is currently renting under a sublease arrangement. The Company has determined that it is an operating lease, and that lease commencement occurred in *July 2024.* The initial is from *March 1, 2025,* through *July 31, 2030,* and under the lease agreement the Company has one five-year renewal option to extend the lease through *July 2035.* Undiscounted minimum monthly rent payments average approximately $13,000 over the initial term of the lease.

In *May 2023,* the Company entered into an operating lease agreement to relocate its principal office from Englewood, Colorado to Denver, Colorado. The lease has a commencement date of *October 1, 2023,* with an initial term of five and a half years. Undiscounted minimum monthly rent payments average approximately $15,500 over the initial term of the lease. Variable lease payments will be expensed as incurred. Under the lease agreement, the Company has one five-year renewal option through *March 2034.*

***Legal Matters***

*Witmer Class-Action Securities Litigation*

A stockholder derivative suit was filed on *September 12, 2022,* in the Delaware Chancery Court by Paul Witmer, derivatively and on behalf of all Aytu stockholders, against Armistice Capital, LLC, Armistice Capital Master Fund, Ltd., Steve Boyd (Armistice's Chief Investment Officer and Managing Partner, and a former director of Aytu), and certain other current and former directors of Aytu, Joshua R. Disbrow, Gary Cantrell, John Donofrio, Jr., Michael Macaluso, Carl Dockery and Ketan B. Mehta. Plaintiff amended the complaint on *April 5, 2023.* The Amended Complaint dropped Mr. Macaluso as a defendant and alleges that (i) Armistice facilitated the sale of assets of Cerecor in *2019* and Innovus in *2020* to Aytu in exchange for convertible securities which it subsequently converted and sold at a profit on the open market; (ii) the Armistice defendants breached their fiduciary duties, were unjustly enriched and wasted corporate assets in connection with these acquisitions; (iii) the Armistice defendants breached their fiduciary duties by engaging in insider trading; and (iv) the other directors breached their fiduciary duties, and aided and abetted the Armistice defendants' breaches of fiduciary duties, in connection with these acquisitions. The Amended Complaint sought unspecified damages, equitable relief, restitution, disgorgement of profits, enhanced governance and internal procedures, and attorneys' fees. While the Company believes that this lawsuit is without merit and have vigorously defended against it, the Company agreed to settle the matter for various corporate governance modifications and the payment of plaintiff's attorneys' fees. That settlement is subject to court approval, the hearing on which has *not* yet been scheduled.

*Sabby Litigation*

A complaint was filed on *February 22, 2023,* in the Supreme Court of the State of New York by Sabby Volatility Warrant Master Fund LTD ("Sabby") and Walleye Opportunities Master Fund Ltd ("Walleye"), holders of certain warrants to purchase common stock, against the Company. The complaint alleged that the Company improperly adjusted the exercise price of the warrants and miscalculated the number of shares the warrant holders *may* receive, and that the Company failed to provide prompt notice to the warrant holders of such adjustment. The complaint sought a declaratory judgment of the warrant share calculation, that 575,000 warrant shares be due to Sabby on exercise of its warrants rather than 312,908 shares, and that 100,000 warrant shares be due to Walleye on exercise of its warrants rather than 54,146 shares. In *October 2023,* the Company entered into a settlement agreement and general release with Sabby and Walleye.

*Stein Litigation*

Cielo Stein ("Stein"), a former sales specialist, filed a complaint on *February 1, 2023,* in Jefferson County Circuit Court in Kentucky against the Company and its wholly-owned subsidiary Neos. The complaint alleged that Aytu retaliated against Stein in violation of the Kentucky Civil Rights Act after she opposed what she contends was unwelcome behavior by her supervisor. The complaint also alleged that the Company's response to Stein's subsequent complaint to human resources was inadequate. The complaint sought an award of unspecified compensatory damages, emotional-distress damages, and attorneys' fees and costs. The Company removed the lawsuit to the United States District Court for the Western District of Kentucky. A Section *16* pretrial conference was held on *June 3, 2024.* During the pretrial conference the parties agreed to settle the matter. The parties entered into a settlement and release agreement on *August 5, 2024.* The matter has been closed.

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**Note *19* - License Agreements**

***Healight***

In *April 2020,* the Company entered into a licensing agreement with Cedars-Sinai Medical Center to secure worldwide rights to various potential esophageal and nasopharyngeal uses of Healight, an investigational medical device platform technology. The agreement with Cedars-Sinai grants the Company a license to all patent and development related technology rights for the intra-corporeal therapeutic use of ultraviolet light in the field of endotracheal and nasopharyngeal applications. The term of the agreement is on a country-by-country basis and will expire on the latest of the date upon which the last to expire valid claim shall expire, *ten* years after the *first* bona fide commercial sale of such licensed product in a country, or the expiration of any market exclusivity period granted by a regulatory agency. Pursuant to the terms of the agreement, the Company paid an initial $0.3 million license fee and $0.1 million in earlier patent prosecution fees.

As a result of the Company's focus on the revenue growth of its commercial business, the Company terminated the licensing agreement with Cedars-Sinai Medical Center, effective *May 9, 2023.*

***NeuRx***

In *October 2018,* Neos entered into an exclusive license agreement ("NeuRx License") with NeuRx Pharmaceuticals LLC ("NeuRx"), pursuant to which NeuRx granted Neos an exclusive, worldwide, royalty-bearing license to research, develop, manufacture and commercialize certain pharmaceutical products containing NeuRx's proprietary compound designated as NRX-*101,* referred to by Neos as *NT0502. NT0502* is a new chemical entity that was being developed by Neos for the treatment of sialorrhea, which is excessive salivation or drooling. The Company *may* be required to make certain development and milestone payments and royalties based on annual net sales, as defined in the NeuRx License. Royalties are to be paid on a country-by-country and licensed product-by-licensed product basis, during the period of time beginning on the *first* commercial sale of such licensed product in such country and continuing until the later of: (i) the expiration of the last-to-expire valid claim in any licensed patent in such country that covers such licensed product in such country; and/or (ii) expiration of regulatory exclusivity of such licensed product in such country.

In *April 2023,* the Company returned the *NT0502* rights to NeuRx in exchange for, and to receive a royalty and potential milestone payments on amounts received for future revenue generated by NeuRx (or a future licensee) on *NT0502.*

***Teva***

On *December 21, 2018,* the Company and Teva entered into an agreement granting Teva a non-exclusive license to certain patents owned by Neos by which Teva has the right to manufacture and market its generic version of Cotempla under an abbreviated new drug application ("ANDA") filed by Teva beginning on *July 1, 2026,* or earlier under certain circumstances. The ANDA was approved by the FDA on *June 19, 2020.*

***Actavis***

On *October 17, 2017,* the Company entered into an agreement granting Actavis a non-exclusive license to certain patents owned by the Company by which Actavis has the right to manufacture and market its generic version of Adzenys under its ANDA beginning on *September 1, 2025,* or earlier under certain circumstances. The ANDA was approved by the FDA on *June 22, 2023.*

***Shire***

In *July 2014,* Neos entered into a settlement agreement and an associated license agreement (the *"2014* License Agreement") with Shire LLC ("Shire") for a non-exclusive license to certain patents for certain activities with respect to Neos' New Drug Application (the "NDA") *No. 204326* for an extended-release orally disintegrating amphetamine polistirex tablet. In accordance with the terms of the *2014* License Agreement, following the receipt of the approval from the FDA for Adzenys, Neos paid a lump sum, non-refundable license fee of an amount less than $1.0 million in *February 2016.* Neos is paying a single digit royalty on net sales of Adzenys during the life of the patents. The settlement agreement expired in *May 2023.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *43*

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**Note *20* - Discontinued Operations**

On *July 31, 2024,* after the wind down of operations, the Company entered into a definitive agreement to divest its Consumer Health business to a private, e-commerce focused company. The divested business encompassed the established e-commerce platform, certain inventory and associated consumer brands, intellectual property, external workforce and contracts, and provided for the Company to receive contingent consideration payments on certain future sales of former Consumer Health business products.

The accounting requirements for reporting the Consumer Health business as discontinued operation were met when the wind down and divestiture was completed on *July 31, 2024.* Accordingly, the accompanying consolidated financial statements for all periods presented reflect this business as a discontinued operation and certain assets and liabilities of discontinued operations have been reclassified to the current assets of discontinued operations; non-current assets of discontinued operations; and current liabilities of discontinued operations financial statement line items on the accompanying consolidated balance sheets as of *June 30, 2024,* and *2023.* The Company elected to record the contingent consideration portion of the arrangement when the consideration is determined to be realizable and, therefore, the Company did *not* record a contingent consideration asset at the transaction date and any subsequent proceeds will *not* be recognized until the contingent consideration asset is realizable, at which point the Company will recognize it to loss from discontinued operations.

The key components of loss from discontinued operations, net of tax for the years ended *June 30, 2024,* and *2023,* were as follows:

---

| | | |
|:---|:---|:---|
|  | **Year Ended**  | **Year Ended**  |
|  | **June 30,**  | **June 30,**  |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| Net revenue | $15819 | $33600 |
| Cost of sales | (10287) | (19197) |
| Selling and marketing | (4875) | (17217) |
| General and administrative | (2560) | (3096) |
| Research and development | (22) | (116) |
| Amortization of intangible assets | (1529) | (1097) |
| Restructuring costs | (209) |  |
| Impairment expense |  | (2975) |
| Gain from contingent consideration |  | 391 |
| Interest expense | (35) | (55) |
| **Loss from discontinued operations before income taxes** | **(3698)** | **(9762)** |
| Income tax benefit | 374 | 263 |
| **Net loss from discontinued operations, net of tax** | $**(3324)** | $**(9499)** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F- *44*

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The key components of assets and liabilities of discontinued operations as of *June 30, 2024,* and *2023,* were as follows:

---

| | | |
|:---|:---|:---|
|  | **June 30,** | **June 30,** |
|  | **2024** | **2023** |
|  | **(in thousands)** | **(in thousands)** |
| **ASSETS** |  |  |
| Current assets of discontinued operations: |  |  |
| Accounts receivable, net | $91 | $209 |
| Inventories | 492 | 3487 |
| Prepaid expenses and other current assets | 538 | 1735 |
| Total current assets of discontinued operations | 1121 | 5431 |
| Non-current assets of discontinued operations: |  |  |
| Property and equipment, net |  | 36 |
| Operating lease right-of-use assets |  | 226 |
| Intangible assets, net |  | 1529 |
| Other non-current assets | 44 | 91 |
| Total current assets of discontinued operations | 44 | 1882 |
| Total current and non-current assets of discontinued operations | $1165 | $7313 |
| **LIABILITIES** |  |  |
| Current liabilities of discontinued operations: |  |  |
| Accounts payable | $126 | $929 |
| Accrued liabilities | 431 | 837 |
| Total current liabilities of discontinued operations | $557 | $1766 |

---

**Note *21* - Subsequent Events**

*Wind Down and Subsequent Divestiture of Consumer Health Business*

In *July 2024,* the Company completed the wind down of its Consumer Health Segment and on *July 31, 2024,* the Company entered into a definitive agreement to divest its Consumer Health (a/k/a Innovus Pharmaceuticals) business to a private, e-commerce focused company affiliated with the Company's former Vice President of Consumer Health, Jonathan Hughes. Pursuant to the definitive agreement, Mr. Hughes resigned from the Company effective *July 31, 2024.* The divested business encompasses the established e-commerce platform, certain inventory and associated consumer brands, intellectual property, contracts and liabilities, and provides for the Company to receive up to $0.5 million of revenue-based royalty payments and recovery of cost on certain future sales of former Consumer Health business products. Upon consummation of this agreement, the Company has completed its wind down of the Consumer Health Segment.

**Note *22* - Subsequent Events in Connection with Recast (unaudited)**

As a result of the wind down and divestiture of the Consumer Health business as described further in *Note *1* - Nature of Business and Financial Condition, Note *2* - Summary of Significant Accounting Policies, Note *20* - Discontinued Operations and Note *21* - Subsequent Events*, the Company determined that the accounting requirements for reporting the Consumer Health business as a discontinued operation were met when the wind down and divestiture was completed on *July 31, 2024,* and that the Company now operates as *one* single operating and reportable segment. Due to such determination the Company has recast its consolidated financial statements and the notes thereto for the years ended *June 30, 2024,* and *2023,* to reflect the Consumer Health business as a discontinued operation and the Company as *one* single operating and reportable segment. In connection with the recasting of these consolidated financial statements and the notes thereto, the Company has considered whether there are other subsequent events that have occurred since *September 26, 2024,* and through *April 28, 2025,* that require recognition or disclosure in these consolidated financial statements and the notes thereto and believes that there are *no* such events.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; F-45

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Shares of Common Stock**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Prefunded Warrants to Purchase Shares of Common Stock**

**and Shares of Common Stock Underlying the Prefunded Warrants**

![aytulogolarge.jpg](aytulogolarge.jpg)

AYTU BIOPHARMA, INC.

*Sole book-runner* 

**Lake Street**

The date of this prospectus is , 2025

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[**Table of Contents**](#toc)

**PART II** — **INFORMATION NOT REQUIRED IN THE PROSPECTUS**

**Item 13.**

**Other Expenses of Issuance and Distribution.**

The following table sets forth an estimate of the fees and expenses (in thousands) relating to the issuance and distribution of the securities being registered hereby, all of which shall be borne by the registrant. All of such fees and expenses, except for the SEC registration and the Financial Industry Regulatory Authority, or FINRA, filing fee, are estimated:

---

| | |
|:---|:---|
| SEC registration fee | $1837 |
| FINRA filing fee | 2300 |
| Transfer agent and registrar fees and expenses | 15000 |
| Legal fees and expenses | 200000 |
| Accounting fees and expenses | 150000 |
| Miscellaneous fees and expenses | 10000 |
| **Total** | $379137 |

---

**Item 14.**

**Indemnification of Directors and Officers.**

Our restated certificate of incorporation and restated bylaws provide that each person who was or is made a party or is threatened to be made a party to or is otherwise involved (including, without limitation, as a witness) in any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or she is or was one of our directors or officers or is or was serving at our request as a director, officer, member, manager or trustee of another corporation, or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan, whether the basis of such proceeding is alleged action in an official capacity as a director, officer or trustee or in any other capacity while serving as a director, officer or trustee, shall be indemnified and held harmless by us to the fullest extent authorized by the Delaware General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits us to provide broader indemnification rights than such law permitted us to provide prior to such amendment) against all expense, liability and loss (including attorneys' fees, judgments, fines, Employee Retirement Income Security Act excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such indemnitee in connection therewith. These provisions limit the liability of our directors and officers to the fullest extent permitted under Delaware law. A director will not receive indemnification if he or she is found not to have acted in good faith.

Section 145 of the Delaware General Corporation Law permits a corporation to indemnify any director or officer of the corporation against expenses (including attorney's fees), judgments, fines and amounts paid in settlement actually and reasonably incurred in connection with any action, suit or proceeding brought by reason of the fact that such person is or was a director or officer of the corporation, if such person acted in good faith and in a manner that he reasonably believed to be in, or not opposed to, the best interests of the corporation, and, with respect to any criminal action or proceeding, if he or she had no reasonable cause to believe his or her conduct was unlawful. In a derivative action (i.e., one brought by or on behalf of the corporation), indemnification may be provided only for expenses actually and reasonably incurred by any director or officer in connection with the defense or settlement of such an action or suit if such person acted in good faith and in a manner that he or she reasonably believed to be in, or not opposed to, the best interests of the corporation, except that no indemnification shall be provided if such person shall have been adjudged to be liable to the corporation, unless and only to the extent that the court in which the action or suit was brought shall determine that such person is fairly and reasonably entitled to indemnity for such expenses despite such adjudication of liability.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; II-1

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Pursuant to Section 102(b)(7) of the Delaware General Corporation Law, Article Eighth of our restated certificate of incorporation eliminates the liability of a director to us or our stockholders for monetary damages for such a breach of fiduciary duty as a director, except for liabilities arising:

● from any breach of the director's duty of loyalty to us or our stockholders;

● from acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;

● under Section 174 of the Delaware General Corporation Law; or

● from any transaction from which the director derived an improper personal benefit.

We carry insurance policies insuring our directors and officers against certain liabilities that they may incur in their capacity as directors and officers. We have entered into indemnification agreements with certain of our executive officers and directors. These agreements, among other things, indemnify and advance expenses to our directors and officers for certain expenses, including attorney's fees, judgments, fines and settlement amounts incurred by any such person in any action or proceeding, including any action by us arising out of such person's services as our director or officer, or any other company or enterprise to which the person provides services at our request. We believe that these provisions and agreements are necessary to attract and retain qualified persons as directors and officers. We have entered into agreements to indemnify all of our directors and officers.

In addition, the registrant has entered into indemnification agreements with each of its current directors and executive officers. These agreements will require the registrant to indemnify these individuals to the fullest extent permitted under Delaware law against liabilities that may arise by reason of their service to the registrant and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified. The registrant also intends to enter into indemnification agreements with its future directors and executive officers.

**Item 15.**

**Recent Sales of Unregistered Securities**

None.

**Item 16.**

**Exhibits and Financial Statement Schedules.**

*(a)* &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *Financial Statements*

---

| | |
|:---|:---|
| **Audited Consolidated Financial Statements** – **as of and for the Years Ended June 30, 2024, and 2023** | **Page** |
| [Report of Independent Registered Public Accounting Firm <u>(PCAOB ID 248)</u>](#report) | [F-2](#report) |
| [Consolidated Balance Sheets](#bs) | [F-4](#bs) |
| [Consolidated Statements of Operations](#sop) | [F-5](#sop) |
| [Consolidated Statements of Stockholders<u>'</u> <u>Equity</u>](#se) | [F-6](#se) |
| [Consolidated Statements of Cash Flows](#cf) | [F-7](#cf) |
| [Notes <u>to the Consolidated Financial Statements</u>](#notes) | [F-8](#notes) |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; II-2

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[**Table of Contents**](#toc)

*(b)*&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *Exhibits*

The following exhibits are being filed with this Registration Statement:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Exhibit No.** | **Description** | **Registrant's** <br> **Form** | **Date Filed** | **Exhibit**<br> **Number** | **Filed** <br> **Herewith** |
| 1.1\* | [Form of Underwriting Agreement.](ex_825696.htm) |  |  |  |  |
| 2.1 | [<u>Agreement and Plan of Merger, dated as of September 12, 2019, by and among Aytu BioScience, Inc., Aytu Acquisition Sub, Inc. and Innovus Pharmaceuticals, Inc.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000165495419010889/aytu_ex21.htm) | 8-K | 09/18/19 | 2.1 |  |
| 2.2 | [<u>Asset Purchase Agreement, dated October 10, 2019, by and between Aytu Bioscience, Inc. and Cerecor Inc.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000165495419011717/aytu_ex101.htm) | 8-K | 10/15/19 | 2.1 |  |
| 2.3 | [<u>Agreement and Plan of Merger, dated as of December 10, 2020, by and among Aytu BioScience, Inc., Neutron Acquisition Sub, Inc. and Neos Therapeutics, Inc.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390020042028/ea131376ex2-1_aytubio.htm) | 8-K | 12/10/20 | 2.1 |  |
| 2.4 | [<u>Asset Purchase Agreement, dated April 12, 2021, by and among Aytu BioPharma, Inc., Rumpus VEDS LLC, Rumpus Therapeutics LLC, Rumpus Vascular LLC, Christopher Brooke and Nathaniel Massari.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774921012543/ex_249110.htm) | 10-Q | 05/17/21 | 2.4 |  |
| 3.1 | [<u>Certificate of Incorporation effective, June 3, 2015.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000119312515217957/d939908dex31.htm) | 8-K | 06/09/15 | 3.1 |  |
| 3.2 | [<u>Certificate of Amendment of Certificate of Incorporation, effective June 1, 2016.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000114420416106487/v441568_ex3-1.htm) | 8-K | 06/02/16 | 3.1 |  |
| 3.3 | [<u>Certificate of Amendment of Certificate of Incorporation, effective June 30, 2016.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000114420416111027/v443180_ex3-1.htm) | 8-K | 07/01/16 | 3.1 |  |
| 3.4 | [<u>Certificate of Amendment of Certificate of Incorporation, effective August 25, 2017.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000114420417045636/v474281_ex3-1.htm) | 8-K | 08/29/17 | 3.1 |  |
| 3.5 | [<u>Certificate of Amendment to the Restated of Certificate of Incorporation, effective August 10, 2018.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390018010718/f8k081018ex3-1_aytubio.htm) | 8-K | 08/10/18 | 3.1 |  |
| 3.6 | [<u>Certificate of Amendment to the Restated Certificate of Incorporation, effective December 8, 2020.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000165495420013283/aytu_ex31.htm) | 8-K | 12/08/20 | 3.1 |  |
| 3.7 | [<u>Certificate of Amendment to the Restated Certificate of Incorporation, effective May 20, 2020.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774924030062/ex_726135.htm) | 10-K | 09/26/24 | 3.6 |  |
| 3.8 | [<u>Certificate of Amendment of Certificate of Incorporation, effective March 22, 2021.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390021016775/ea138107ex3-1_aytubio.htm) | 8-K | 03/22/21 | 3.1 |  |
| 3.9 | [<u>Certificate of Amendment of Certificate of Incorporation, effective January 4, 2023.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000110465923001400/tm231530d1_ex3-1.htm) | 8-K | 01/05/23 | 3.1 |  |
| 3.10 | [<u>Amended and Restated Bylaws.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022007674/aytu-20220504xex3d1.htm) | 8-K | 05/09/22 | 3.1 |  |
| 4.1 | [<u>Form of Common Stock Purchase Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390018002319/fs12018a3ex4-8_aytubio.htm) | S-1 | 02/27/18 | 4.8 |  |
| 4.2 | [<u>Form of Placement Agent Common Stock Purchase Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390020006311/ea119575ex4-2_aytubio.htm) | 8-K | 03/13/20 | 4.2 |  |
| 4.3 | [<u>Form of Common Stock Purchase Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390020006311/ea119575ex4-1_aytubio.htm) | 8-K | 03/13/20 | 4.1 |  |
| 4.4 | [<u>Form of Common Stock Purchase Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390020007021/ea119842ex4-1_aytubio.htm) | 8-K | 03/20/20 | 4.1 |  |
| 4.5 | [<u>Form of Placement Agent Common Stock Purchase Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390020007021/ea119842ex4-2_aytubio.htm) | 8-K | 03/20/20 | 4.2 |  |
| 4.6 | [<u>Form of Wainwright Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390020016604/ea123752aex4-1_aytubio.htm) | 8-K | 07/02/20 | 4.1 |  |
| 4.7 | [<u>Form of Prefunded Common Stock Purchase Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022002837/aytu-20220302xex4d1.htm) | 8-K | 03/04/22 | 4.1 |  |
| 4.8 | [<u>Form of Common Stock Purchase Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022002837/aytu-20220302xex4d2.htm) | 8-K | 03/04/22 | 4.2 |  |
| 4.9 | [<u>Form of Prefunded Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000110465922088699/tm2222304d3_ex4-1.htm) | 8-K | 08/10/22 | 4.1 |  |
| 4.10 | [<u>Form of Common Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000110465922088699/tm2222304d3_ex4-2.htm) | 8-K | 08/10/22 | 4.2 |  |
| 4.11 | [<u>Form of Prefunded Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000110465923068133/tm2313999d4_ex4-10.htm) | S-1/A | 06/05/23 | 4.10 |  |
| 4.12 | [<u>Form of Tranche A Warrant</u>.](http://www.sec.gov/Archives/edgar/data/1385818/000110465923068133/tm2313999d4_ex4-11.htm) | S-1A | 06/05/23 | 4.11 |  |
| 4.12 | [<u>Description of Securities</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022014652/aytu-20220630xex4d9.htm). | 10-K | 09/27/22 | 4.9 |  |
| 4.13\* | [Form of Prefunded Warrant.](ex_825697.htm) |  |  |  |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; II-3

------

[**Table of Contents**](#toc)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Exhibit No.** | **Description** | **Registrant's** <br> **Form** | **Date Filed** | **Exhibit**<br> **Number** | **Filed** <br> **Herewith** |
| 5.1\* | [Opinion of Dorsey & Whitney LLP.](ex_825900.htm) |  |  |  |  |
| 10.1 | [<u>Loan and Security Agreement, by and between Neos Therapeutics, Inc., Neos Therapeutics Brands, LLC, and Neos Therapeutics, LP, Neos Therapeutics Commercial, LLC, PharmaFab Texas, LLC, and Encina Business Credit, LLC, dated October 2, 2019.</u>](http://www.sec.gov/Archives/edgar/data/1467652/000110465919052850/a19-19348_1ex10d1.htm) | 8-K | 10/3/19 | 10.1 |  |
| 10.2 | [<u>Commitment Letter, dated as of December 10, 2020, by and among Aytu BioScience, Inc., Neos Therapeutics, Inc. and Encina Business Credit, LLC.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390020042028/ea131376ex10-3_aytubio.htm) | 8-K | 12/10/20 | 10.3 |  |
| 10.3 | [<u>Consent, Waiver and Amendment No. 1 to Loan and Security Agreement, by and among Aytu BioScience, Inc., Neos Therapeutics, Inc., Neos Therapeutics Brands, LLC, Neos Therapeutics, LP, Neos Therapeutics Commercial, LLC, PharmaFab Texas, LLC, and Encina Business Credit, LLC, dated March 19, 2021.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390020042028/ea131376ex10-3_aytubio.htm) | 8-K | 03/22/21 | 10.3 |  |
| 10.4& | [<u>Consent, Joinder and Second Amendment to Loan and Security Agreement dated January 26, 2022 between the registrant and Eclipse Business Capital LLC.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022001110/aytu-20211231xex10d3.htm) | 10-Q | 02/14/22 | 10.3 |  |
| 10.5 | [<u>Amendment No. 4 to Loan and Security Agreement by and among Neos Therapeutics, Inc., Neos Therapeutics Brands, LLC, Neos Therapeutics, LP, Neos Therapeutics Commercial, LLC, PharmaFab Texas, LLC, Aytu Therapeutics, LLC, Innovus Pharmaceuticals, Inc., Semprae Laboratories, Inc., Novalere, Inc., Delta Prime Savings Club, Inc. and Eclipse Business Capital LLC, dated March 24, 2023.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023009367/aytu-20230331xex10d1.htm) | 10-Q | 05/11/23 | 10.1 |  |
| 10.6# | [<u>Consent, Joinder and Amendment No. 5 to Loan and Security Agreement dated June 12, 2024, between Aytu BioPharma, Inc., the Obligors and lenders party thereto and Eclipse Business Capital LLC as agent.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774924020590/ex_688588.htm) | 8-K | 06/18/24 | 10.1 |  |
| 10.7 | [<u>Term Loan Note dated June 12, 2024.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774924020590/ex_688889.htm) | 8-K | 06/18/24 | 10.2 |  |
| 10.8 | [<u>Second Amended and Restated Revolving Note dated June 12, 2024.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774924020590/ex_688888.htm) | 8-K | 06/18/24 | 10.3 |  |
| 10.9& | [<u>Loan and Security Agreement dated January 26, 2022 between the registrant and the Avenue Capital Lenders and Avenue Capital Agent.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022001110/aytu-20211231xex10d3.htm) | 10-Q | 02/14/22 | 10.3 |  |
| 10.10 | [<u>Second Amendment to Loan Documents by and among Avenue Capital Management II L.P., certain lenders and Aytu BioPharma, Inc., dated March 24, 2023.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023009367/aytu-20230331xex10d2.htm) | 10-Q | 05/11/23 | 10.2 |  |
| 10.11 | [<u>Common Stock Purchase Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000165495419001148/aytu_ex105.htm) | 10-Q | 02/07/19 | 10.5 |  |
| 10.12 | [<u>Registration Rights Agreement dated January 26, 2022 between Aytu and each of the warrant holders.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022001110/aytu-20211231xex10d5.htm) | 10-Q | 02/14/22 | 10.5 |  |
| 10.13& | [<u>Form of Warrant.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022001110/aytu-20211231xex10d6.htm) | 10-Q | 02/14/22 | 10.6 |  |
| 10.14 | [<u>Form of Placement Agency Agreement.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000110465923068133/tm2313999d4_ex10-42.htm) | S-1/A | 06/05/23 | 10.42 |  |
| 10.15 | [<u>Form of Securities Purchase Agreement.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000110465923068133/tm2313999d4_ex10-43.htm) | S-1/A | 06/05/23 | 10.43 |  |
| 10.16 | [<u>Amended and Restated Exclusive License Agreement, dated June 11, 2018, between Aytu BioScience, Inc. and Magna Pharmaceuticals, Inc.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000121390018012209/f10k2018ex10-31_aytubio.htm) | 10-K | 09/06/18 | 10.31 |  |
| 10.17& | [<u>License, Development, Manufacturing and Supply Agreement, dated November 2, 2018.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000165495419001148/aytu_ex102.htm) | 10-Q | 02/07/19 | 10.2 |  |
| 10.18# | [<u>Amended and restated License and Supply Agreement with Acerus Pharmaceuticals, dated July 29, 2019.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000165495419008769/aytu_ex101.htm) | 8-K | 08/02/19 | 10.1 |  |
| 10.19 | [<u>Form of Contingent Value Rights Agreement.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000165495419010889/aytu_ex101.htm) | 8-K | 09/18/19 | 10.1 |  |
| 10.20 | [<u>First Amendment to Asset Purchase Agreement with Cerecor, Inc., dated November 1, 2019.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000165495419012301/aytu_ex101.htm) | 8-K | 11/04/19 | 10.1 |  |
| 10.21 | [<u>Waiver and Amendment to the July 29, 2019 Amended and Restated License and Supply Agreement, dated November 29, 2019.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000165495419013481/aytu_ex101.htm) | 8-K | 12/02/19 | 10.1 |  |
| 10.22 | [<u>Termination and Transition Agreement between Aytu BioPharma, Inc. and Acerus Pharmaceuticals Corporation, dated March 31, 2021.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774921012543/ex_249111.htm) | 10-Q | 05/17/21 | 10.9 |  |
| 10.23 | [<u>Option Agreement between Rumpus VEDS, LLC and Denovo Biopharma LLC, dated December 21, 2019.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774921012543/ex_249686.htm)  | 10-Q | 05/17/21 | 10.14 |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; II-4

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---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Exhibit No.** | **Description** | **Registrant's** <br> **Form** | **Date Filed** | **Exhibit**<br> **Number** | **Filed** <br> **Herewith** |
| 10.24 | [<u>Exclusive License Agreement between Rumpus VEDS, LLC and Johns Hopkins University, dated December 20, 2019.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774921012543/ex_250530.htm) | 10-Q | 05/17/21 | 10.15 |  |
| 10.25& | [<u>Asset Purchase Agreement, dated July 1, 2020, by and between Aytu BioPharma, Inc. and UAB "</u><u>Caerus Biotechnologies.</u><u>"</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837021012825/aytu-20210630xex10d79.htm) | 10-K | 09/28/21 | 10.79 |  |
| 10.26& | [<u>Termination Agreement, dated June 29, 2021 by and between Aytu BioPharma, Inc. and Avrio Genetics, LLC.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837021012825/aytu-20210630xex10d80.htm) | 10-K | 09/28/21 | 10.80 |  |
| 10.27#& | [<u>Settlement and Termination of License Agreement between the Registrant and TRIS Pharma, Inc., dated May 12, 2022.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022008952/aytu-20220331xex10d1.htm) | 10-Q | 05/16/22 | 10.1 |  |
| 10.28& | [<u>Commercial Manufacturing Services Agreement by and between the Company and Halo Pharmaceutical, Inc., dated November 13, 2023.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774924004149/ex_626088.htm) | 10-Q | 02/14/24 | 10.1 |  |
| 10.29 | [<u>Commercial Lease Agreement dated June 10, 1999, between Walstib, L.P. and Pharmafab, Inc.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023016393/aytu-20230630xex10d48.htm) | 10-K | 10/12/23 | 10.48 |  |
| 10.30 | [<u>First Amendment to Lease dated September 1, 2002, between Walstib, L.P. and PFAB, LP.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023016393/aytu-20230630xex10d49.htm) | 10-K | 10/12/23 | 10.49 |  |
| 10.31 | [<u>Second Amendment to Lease dated September 4, 2003, between Teachers Insurance and Annuity Association of America and PFAB, LP.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023016393/aytu-20230630xex10d50.htm)  | 10-K | 10/12/23 | 10.50 |  |
| 10.32 | [<u>Third Amendment to Lease dated October 1, 2003, Between TIAA and PFAB, LP.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023016393/aytu-20230630xex10d51.htm) | 10-K | 10/12/23 | 10.51 |  |
| 10.33 | [<u>Fourth Amendment to Lease dated May 1, 2009, between TIAA and Neos Therapeutics, LP (formerly PFAB, LP).</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023016393/aytu-20230630xex10d52.htm) | 10-K | 10/12/23 | 10.52 |  |
| 10.34 | [<u>Fifth Amendment to Lease dated April 5, 2010, between TIAA and Neos Therapeutics, LP.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023016393/aytu-20230630xex10d53.htm) | 10-K | 10/12/23 | 10.53 |  |
| 10.35 | [<u>Sixth Amendment to Lease dated August 14, 2013, between Riverside Business Green, LP and Neos Therapeutics, LP.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023016393/aytu-20230630xex10d54.htm) | 10-K | 10/12/23 | 10.54 |  |
| 10.36† | [<u>2015 Stock Option and Incentive Plan, as amended on July 26, 2017.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000114420417038709/v471569_ex10-1.htm) | 8-K | 07/27/17  | 10.1 |  |
| 10.37† | [<u>Aytu BioPharma, Inc. 2023 Equity Incentive Plan.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000110465923074325/tm2319424d1_ex10-1.htm) | S-8 | 06/23/23 | 10.1 |  |
| 10.38† | [Amendment to the Aytu BioPharma, Inc. 2023 Equity Incentive Plan.](http://www.sec.gov/Archives/edgar/data/1385818/000143774925017989/ex_820825.htm) | 8-K | 05/21/25 | 10.1 |  |
| 10.39 | [<u>Form of Indemnification Agreement.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837022010509/aytu-20220629xex10d1.htm) | 8-K | 07/01/22 | 10.1 |  |
| 10.40† | [<u>Amended and Restated Employment Agreement by and between Aytu BioPharma, Inc. and Joshua R. Disbrow dated February 13, 2023.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023016393/aytu-20230630xex10d45.htm) | 10-K | 10/12/23 | 10.45 |  |
| 10.41† | [Amended and Restated Employment Agreement by and between Aytu BioPharma, Inc. and Jarrett T. Disbrow dated March 20, 2023.](http://www.sec.gov/Archives/edgar/data/1385818/000143774924030062/ex_721289.htm) | 10-K | 09/26/24 | 10.42 |  |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Exhibit No.** | **Description** | **Registrant's** <br> **Form** | **Date Filed** | **Exhibit**<br> **Number** | **Filed** <br> **Herewith** |
| 10.42† | [<u>Amended and Restated Employment Agreement by and between Aytu BioPharma, Inc. and Greg Pyszczymuka dated March 21, 2023.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000155837023016393/aytu-20230630xex10d55.htm) | 10-K | 10/12/23 | 10.55 |  |
| 10.43† | [<u>Amended and Restated Employment Agreement by and between Aytu BioPharma, Inc. and Ryan J. Selhorn dated November 11, 2024</u>.](http://www.sec.gov/Archives/edgar/data/1385818/000143774924034898/ex_745344.htm) | 8-K | 11/13/24 | 10.1 |  |
| 10.44† | [<u>Separation and Release Agreement</u> <u>by and between Aytu BioPharma, Inc. and Mark K. Oki dated December 1, 2024.</u>](http://www.sec.gov/Archives/edgar/data/1385818/000143774925003568/ex_768099.htm) | 10-Q | 02/12/25 | 10.2 |  |
| 21.1 | [<u>List of Subsidiaries</u>.](http://www.sec.gov/Archives/edgar/data/1385818/000155837022014652/aytu-20220630xex21d1.htm) | 10-K | 09/26/24 | 21.1 |  |
| 23.1\* | [Consent of Grant Thornton LLP, Independent Registered Public Accounting Firm.](ex_825703.htm) |  |  |  | X |
| 23.2\* | [Consent of Dorsey & Whitney LLP (included in Exhibit 5.1).](ex_825900.htm) |  |  |  | X |
| 24.1\* | [Power of Attorney (contained on signature page hereto).](#poa) |  |  |  | X |
| 101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. |  |  |  | X |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. |  |  |  | X |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document. |  |  |  | X |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. |  |  |  | X |
| 101.LAB | Inline XBRL Taxonomy Extension Labels Linkbase Document. |  |  |  | X |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. |  |  |  | X |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |  |  |  | X |
| 107\* | [Filing Fee Table.](ex_825901.htm) |  |  |  | X |

---

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| | |
|:---|:---|
| † | Indicates is a management contract or compensatory plan or arrangement. |

---

# The company has received confidential treatment of certain portions of this agreement. These portions have been omitted and filed separately with the SEC pursuant to a confidential treatment request.

---

| | |
|:---|:---|
| & | Pursuant to Item 601(b)(10) of Regulation S-K, portions of this exhibit (indicated by asterisks) have been omitted as the registrant has determined that (1) the omitted information is not material and (2) the omitted information would likely cause competitive harm to the registrant if publicly disclosed. |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; II-6

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**Item 17.**

**Undertakings**

(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The undersigned registrant hereby undertakes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the "*Calculation of Registration Fee Table*" table in the effective registration statement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

*Provided*, *however*, that paragraphs (a)(1)(i), (ii) and (iii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this registration statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the United States Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The undersigned registrant hereby undertakes that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

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**SIGNATURES**

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Denver, State of Colorado, on June 2, 2025.

---

| | |
|:---|:---|
| **AYTU BIOPHARMA, INC**.  | **AYTU BIOPHARMA, INC**.  |
| By:  | /s/ Joshua R. Disbrow |
| Name: Joshua R. Disbrow | Name: Joshua R. Disbrow |
| Title: Chief Executive Officer | Title: Chief Executive Officer |

---

**POWER OF ATTORNEY**

We, the undersigned directors and officers of Aytu Biopharma, Inc. (the "Company"), hereby severally constitute and appoint Joshua R. Disbrow as our true and lawful attorney, with full power to him to sign for us and in our names in the capacities indicated below, the registration statement on Form S-1 filed herewith, and any and all pre-effective and post-effective amendments to said registration statement, and any registration statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, in connection with the registration under the Securities Act of 1933, as amended, of equity securities of the Company, and to file or cause to be filed the same, with all exhibits thereto and other documents in connection therewith, with the United States Securities and Exchange Commission, granting unto said attorney full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as each of us might or could do in person, and hereby ratifying and confirming all that said attorney or his substitute or substitutes, shall do or cause to be done by virtue of this Power of Attorney.

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated:

---

| | | |
|:---|:---|:---|
| **Signature** | **Title** | **Date** |
| /s/ Joshua R. Disbrow |  | June 2, 2025 |
| Joshua R. Disbrow | Chief Executive Officer and Director (*Principal Executive Officer*) |  |
| /s/ Ryan J. Selhorn |  | June 2, 2025 |
| Ryan J. Selhorn | Chief Financial Officer (*Principal Financial and Accounting Officer*) |  |
| /s/ John A. Donofrio, Jr. |  | June 2, 2025 |
| John A. Donofrio, Jr. | Chairman |  |
| /s/ Carl C. Dockery |  | June 2, 2025 |
| Carl C. Dockery | Director |  |
| /s/ Abhinav Jain |  | June 2, 2025 |
| Abhinav Jain | Director |  |
| /s/ Vivian Liu |  | June 2, 2025 |
| Vivian Liu | Director |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; II-9

## Exhibit 1.1

**Exhibit 1.1**

**[**•**] Shares of Common Stock and** 

**[**•**] Pre-Funded Warrants to Purchase [**•**] Shares of Common Stock of**

**AYTU BIOPHARMA, INC.**

**<u>UNDERWRITING AGREEMENT</u>**

[•], 2025

Lake Street Capital Markets, LLC

As Representative of the several Underwriters

121 South 8<sup>th</sup> Street, Suite 1000

Minneapolis, MN 55402

Ladies and Gentlemen:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*1.* *Introductory*. Aytu BioPharma, Inc., a Delaware **  corporation (the "  ***Company*** "), proposes to sell, pursuant to the terms of this underwriting agreement (this "  ***Agreement*** "), to the several underwriters named in <u>Schedule A</u> hereto (the "  ***Underwriters*** ," or, each, an "  ***Underwriter*** "), an aggregate of [•] shares of the Company's common stock, $0.0001 par value per share (the "  ***Common Stock***") and an aggregate of [•] pre-funded warrants (the "  ***Pre-Funded Warrants***") to purchase [•] shares of Common Stock (the "  ***Pre-Funded Warrant Shares*** "). The aggregate of [•] shares so proposed to be sold is hereinafter referred to as the "  ***Firm Stock***" and the aggregate of [•] Pre-Funded Warrants so proposed to be sold is hereinafter referred to as the "  ***Firm Pre-Funded Warrants***" and collectively, the Firm Stock, Firm Pre-Funded Warrants and Pre-Funded Warrant Shares is hereinafter referred to as the  ***Firm Securities*** . The Company also proposes to sell to the Underwriters, upon the terms and conditions set forth in <u>Section 3</u> hereof, up to an additional [•] shares of Common Stock (the "  ***Optional Stock***") and/or an additional [•] Pre-Funded Warrants (the "  ***Optional Pre-Funded Warrants***") to purchase [•] shares of Common Stock (the "  ***Optional Pre-Funded Warrant Shares***" and collectively, with the Optional Stock and Optional Pre-Funded Warrants, the "  ***Optional Securities*** "); provided, however, that the sum of the total number of shares of Optional Stock and total number of Optional Pre-Funded Warrants purchased shall not exceed 15% of the total number of Firm Securities purchased. The Firm Securities and Optional Securities are hereinafter collectively referred to as the "  ***Securities*** ." This Agreement, the Lock-up Agreement (as defined below), the Prefunded Warrants, and all exhibits and schedules thereto and hereto and any other documents or agreements executed in connection with the transaction contemplated hereunder are hereinafter collectively referred to as the "  ***Transaction Documents*** ." Lake Street Capital Markets, LLC is acting as representative of the several Underwriters and in such capacity is hereinafter referred to as the "  ***Representative*** ." To the extent that there shall be a sole Underwriter named in Schedule A hereto, all references to the Underwriters shall be deemed to refer only to such sole Underwriter, and all corresponding changes in this Agreement from plural to singular shall be deemed to have been made.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.* *Representations and Warranties of the Company.* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Representations and Warranties of the Company. The Company represents and warrants to the several Underwriters, as of the date hereof and as of each Closing Date (as defined below), and agrees with the several Underwriters, that:

------

(a) <u>Registration Statement</u>. A registration statement of the Company on Form S-1 (File No. 333-[]) (including all amendments thereto, the "***Registration Statement***") in respect of the Securities has been filed with the Securities and Exchange Commission (the "***Commission***") pursuant to the Securities Act of 1933, as amended (the "***Securities Act***"). The Company meets the requirements for use of Form S-1 under the Securities Act and the rules and regulations of the Commission thereunder (the "***Rules and Regulations***"). The Registration Statement and any post-effective amendment thereto, each in the form heretofore delivered to you, and, excluding exhibits thereto, to you for each of the other Underwriters, have been declared effective by the Commission in such form and conform, in all material respects, to the requirements of the Securities Act and the Rules and Regulations. Other than (i) the Registration Statement, (ii) a registration statement, if any, increasing the size of the offering filed pursuant to Rule 462(b) under the Securities Act and the Rules and Regulations (a "***Rule 462(b) Registration Statement***"), (iii) any Preliminary Prospectus (as defined below), (iv) the Prospectus (as defined below) contemplated by this Agreement to be filed pursuant to Rule 424(b) of the Rules and Regulations in accordance with <u>Section 4(i)(a)</u> hereof and (v) any Issuer Free Writing Prospectus (as defined below), no other document with respect to the offer or sale of the Securities has heretofore been filed with the Commission. No stop order suspending the effectiveness of the Registration Statement, any post-effective amendment thereto or the Rule 462(b) Registration Statement, if any, has been issued and no proceeding for that purpose or pursuant to Section 8A of the Securities Act has been initiated or, to the Company's Knowledge, threatened by the Commission (any preliminary prospectus included in the Registration Statement or filed with the Commission pursuant to Rule 424 of the Rules and Regulations that omitted the Rule 430A Information and that was used prior to the filing of the Prospectus is hereinafter called a "***Preliminary Prospectus***"). The Registration Statement, including all exhibits thereto and including the information contained in the Prospectus filed with the Commission pursuant to Rule 424(b) of the Rules and Regulations and deemed by virtue of Rules 430A and 430C under the Securities Act to be part of the Registration Statement at the time it became effective, is hereinafter collectively called the "***Registration Statement***." If the Company has filed a Rule 462(b) Registration Statement, then any reference herein to the term "Registration Statement" shall be deemed to include such Rule 462(b) Registration Statement. The final prospectus relating to the offer and sale of the Securities, in the form filed pursuant to and within the time limits described in Rule 424(b) under the Rules and Regulations, is hereinafter called the "***Prospectus***."

Any reference herein to the Registration Statement, Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item VII of Form S-1 under the Securities Act as of the effective date of the Registration Statement or the date of such Preliminary Prospectus or Prospectus, as the case may be. Any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after the date of such Preliminary Prospectus or the Prospectus under the Securities Exchange Act of 1934, as amended (the "***Exchange Act***"), and incorporated by reference in such Preliminary Prospectus or Prospectus, as the case may be.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>General Disclosure Package</u>. As of the Applicable Time (as defined below) and as of the Closing Date or the Option Closing Date (as defined below), as the case may be, neither (i) the General Use Free Writing Prospectus(es) (as defined below) issued at or prior to the Applicable Time, the Time of Sale Prospectus and the information included on <u>Schedule C</u> hereto, all considered together (collectively, the "***General Disclosure Package***"), nor (ii) any individual Limited Use Free Writing Prospectus (as defined below), nor (iii) the bona fide electronic roadshow (as defined in Rule 433(h)(5) of the Rules and Regulations), when considered together with the General Disclosure Package, included or will include any untrue statement of a material fact or omitted or will omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; <u>provided</u>, <u>however</u>, that the Company makes no representations or warranties as to information contained in or omitted from the Preliminary Prospectus or any Issuer Free Writing Prospectus (as defined below), in reliance upon, and in conformity with, written information furnished to the Company through the Representative by or on behalf of any Underwriter specifically for inclusion therein, which information the parties hereto agree is limited to the Underwriters' Information (as defined in <u>Section 18</u>). As used in this paragraph (b) and elsewhere in this Agreement:

"***Applicable Time***" means [•] [a.m./p.m.], New York time, on [•], 2025 or such other time as agreed to by the Company and the Representative.

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"***Issuer Free Writing Prospectus***" means any "issuer free writing prospectus," as defined in Rule 433 of the Rules and Regulations relating to the Securities in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the Company's records pursuant to Rule 433(g) of the Rules and Regulations.

"***General Use Free Writing Prospectus***" means any Issuer Free Writing Prospectus that is identified on <u>Schedule B</u> to this Agreement.

"***Limited Use Free Writing Prospectuses***" means any Issuer Free Writing Prospectus that is not a General Use Free Writing Prospectus.

"***Time of Sale Prospectus***" means the most recent Preliminary Prospectus that is filed with the Commission prior to the Applicable Time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>No Stop Orders; No Material Misstatements</u>. No order preventing or suspending the use of any Preliminary Prospectus, any Issuer Free Writing Prospectus or the Prospectus relating to the proposed offering of the Securities has been issued by the Commission, and no proceeding for that purpose or pursuant to Section 8A of the Securities Act has been instituted or, to the Company's Knowledge, threatened by the Commission, and each Preliminary Prospectus, at the time of filing thereof, conformed in all material respects to the requirements of the Securities Act and the Rules and Regulations, and did not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; <u>provided</u>, <u>however</u>, that the Company makes no representations or warranties as to information contained in or omitted from any Preliminary Prospectus, in reliance upon, and in conformity with, written information furnished to the Company through the Representative by or on behalf of any Underwriter specifically for inclusion therein, which information the parties hereto agree is limited to the Underwriters' Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Registration Statement and Prospectus Contents</u>. At the respective times, the Registration Statement and any amendments thereto became or become effective as to the Underwriters and at each Closing Date, the Registration Statement and any amendments thereto conformed and will conform in all material respects to the requirements of the Securities Act and the Rules and Regulations and did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; and the Prospectus and any amendments or supplements thereto, at the time the Prospectus or any amendment or supplement thereto was issued and at each Closing Date, conformed and will conform in all material respects to the requirements of the Securities Act and the Rules and Regulations and did not and will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; <u>provided</u>, <u>however</u>, that the foregoing representations and warranties in this paragraph (d) shall not apply to information contained in or omitted from the Registration Statement or the Prospectus, or any amendment or supplement thereto, in reliance upon, and in conformity with, written information furnished to the Company through the Representative by or on behalf of any Underwriter specifically for inclusion therein, which information the parties hereto agree is limited to the Underwriters' Information.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Issuer Free Writing Prospectus</u>. Each Issuer Free Writing Prospectus, as of its issue date and at all subsequent times through the completion of the public offer and sale of the Securities or until any earlier date that the Company notified or notifies the Representative as described in <u>Section 4(i)(c)</u>, did not, does not and will not include any information that conflicted, conflicts or will conflict with the information contained in the Registration Statement, Preliminary Prospectus or the Prospectus, including any document incorporated by reference therein and any prospectus supplement deemed to be a part thereof that has not been superseded or modified, or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, <u>provided</u>, <u>however</u>, that the foregoing representations and warranties in this paragraph (e) shall not apply to information contained in or omitted from the Registration Statement or the Prospectus, or any amendment or supplement thereto, in reliance upon, and in conformity with, written information furnished to the Company through the Representative by or on behalf of any Underwriter specifically for inclusion therein, which information the parties hereto agree is limited to the Underwriters' Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Documents Incorporated by Reference.</u> The documents incorporated by reference in the Registration Statement, Time of Sale Prospectus and the Prospectus, when they were filed with the Commission, conformed in all material respects to the requirements of the Securities Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder and none of such documents contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein, or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; and any further documents so filed and incorporated by reference in the Prospectus, when such documents are filed with the Commission will conform in all material respects to the requirements of the Securities Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Distribution of Offering Materials</u>. The Company has not, directly or indirectly, distributed and will not distribute any offering material in connection with the offering and sale of the Securities other than any Preliminary Prospectus, the Prospectus and other materials, if any, permitted under the Securities Act and consistent with <u>Section 4(i)(b)</u> below. The Company will file with the Commission all Issuer Free Writing Prospectuses (other than a "road show" as described in Rule 433(d)(8) of the Rules and Regulations) in the time and manner required under Rules 163(b)(2) and 433(d) of the Rules and Regulations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Not an Ineligible Issuer</u>. At the time of filing the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendments thereto, and at the date hereof, the Company was not, and the Company currently is not, an "ineligible issuer," as defined in Rule 405 of the Rules and Regulations.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Organization and Good Standing</u>. The Company and each of its Subsidiaries (as defined below) have been duly organized and are validly existing as corporations or other legal entities in good standing (or the foreign equivalent thereof, to the extent such concept exists in the relevant jurisdiction) under the laws of their respective jurisdictions of organization. The Company and each of its Subsidiaries are duly qualified to do business and are in good standing as foreign corporations or other legal entities in each jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such qualification and have all requisite power and authority to carry on their respective businesses to own and use their respective properties, except where the failure to so qualify, be in good standing or have such power or authority would not have a Material Adverse Effect (as defined below). The subsidiaries listed in <u>Schedule E</u> to this Agreement are the only significant subsidiaries of the Company (each, a "***Subsidiary***" and collectively, the "***Subsidiaries***"). "***Material Adverse Effect***" means (i) a material adverse effect on the business, properties, management, financial position, stockholders' equity or results of operations of the Company and its Subsidiaries, taken as a whole, or (ii) a material adverse effect on the Company's ability to perform in any material respect its obligations under this Agreement or to consummate any transactions contemplated by this Agreement, the Time of Sale Prospectus and the Prospectus (any such effect as described in clauses (i) or (ii), a "***Material Adverse Effect***"); provided that a change in the market price or trading volume of the Common Stock alone shall not be deemed, in and of itself, to constitute a Material Adverse Effect and adverse effects resulting solely from or relating solely to the following shall be not be taken into account in determining whether there has been a Material Adverse Effect, except to the extent the impact of the event described therein has an adverse effect on the Company taken as a whole that is materially disproportionate to the Company taken as a whole compared to other companies operating in the same industry: (a) general economic conditions, or conditions in financial, banking or securities markets; (b) general conditions in the industry or any industry sector in which the Company operates or participates; (c) any natural disaster or any national or international political or social conditions or any act of terrorism, sabotage, military action or war or any escalation or worsening thereof or (d) any changes in applicable laws or governmental regulations or the interpretation thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Validity and Binding Effect of Agreements</u>. This Agreement, the Firm Pre-Funded Warrants and the Optional Pre-Funded Warrants have been duly and validly authorized by the Company, and, when executed and delivered, will constitute, the valid and binding agreements of the Company, enforceable against the Company in accordance with their respective terms, except: (i) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors' rights generally; (ii) as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws; and (iii) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) <u>Issuance of the Securities</u>. The Firm Stock and Optional Stock to be issued and sold by the Company to the Underwriters hereunder has been duly and validly authorized and, when issued and delivered against payment therefor as provided herein, will be duly and validly issued, fully paid and non-assessable and will conform in all material respects to the descriptions thereof in the Registration Statement, the General Disclosure Package and the Prospectus; and, except as described or incorporated by reference in the General Disclosure Package, the issuance of the Securities is not subject to any preemptive or similar rights. The Pre-Funded Warrant Shares and Optional Pre-Funded Warrant Shares, when issued in accordance with the terms of the Pre-Funded Warrants and Optional Pre-Funded Warrants, will be validly issued, fully paid and nonassessable. The Company has reserved from its duly authorized capital stock the maximum number of shares of Common Stock issuable pursuant to this Agreement, the Pre-Funded Warrants and Optional Pre-Funded Warrants.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) <u>Capitalization</u>. The Company has an authorized capitalization as described or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, and all of the issued shares of capital stock of the Company, including the Firm Stock and Optional Stock, have been duly and validly authorized and issued, are fully paid and non-assessable, have been issued in material compliance with federal and state securities laws, and conform in all material respects to the description thereof contained or incorporated by reference in the General Disclosure Package and the Prospectus. All of the Company's options, warrants and other rights to purchase or exchange any securities for shares of the Company's capital stock have been duly authorized and validly issued and were issued in material compliance with federal and state securities laws. None of the outstanding shares of Common Stock were issued in violation of any preemptive rights, rights of first refusal or other similar rights to subscribe for or purchase securities of the Company. As of the date set forth in the General Disclosure Package, there were no authorized or outstanding shares of capital stock, options, warrants, preemptive rights, rights of first refusal or other rights to purchase, or equity or debt securities convertible into or exchangeable or exercisable for, any capital stock of the Company or any of its Subsidiaries other than those described above or accurately described or incorporated by reference in the General Disclosure Package. Since the date set forth in the General Disclosure Package, the Company has not issued any securities other than Common Stock issued pursuant to the exercise of warrants or upon the exercise of stock options or other awards outstanding under the Company's stock option plans, options or other securities granted or issued pursuant to the Company's existing equity compensation plans or other plans, and the issuance of Common Stock pursuant to employee stock purchase plans, with such outstanding warrants, stock options, or other stock awards as described in the General Disclosure Package. The description of the Company's stock option, stock bonus and other stock plans or arrangements, and the options or other rights granted thereunder, as described or incorporated by reference in the General Disclosure Package and the Prospectus, accurately and fairly present the information required to be shown with respect to such plans, arrangements, options and rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) <u>Capitalization of Subsidiaries</u>. All the outstanding shares of capital stock (if any) of each Subsidiary of the Company have been duly authorized and validly issued, are fully paid and nonassessable and, except to the extent set forth in the General Disclosure Package and the Prospectus, are owned by the Company directly or indirectly through one or more wholly-owned Subsidiaries, free and clear of any claim, lien, encumbrance, security interest, restriction upon voting or transfer or any other claim of any third party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) <u>No Conflicts</u>. The execution, delivery and performance of this Agreement by the Company, the issue and sale of the Securities by the Company and the consummation of the transactions contemplated hereby will not (with or without notice or lapse of time or both) (i) conflict with or result in a breach or violation of any of the terms or provisions of, constitute a default or a Debt Repayment Triggering Event (as defined below) under, or result in the creation or imposition of any lien, encumbrance, security interest, claim or charge upon any property or assets of the Company or any Subsidiary pursuant to, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound or to which any of the property or assets of the Company or any of its Subsidiaries is subject, (ii) result in any violation of the provisions of the charter or by-laws (or analogous governing instruments, as applicable) of the Company or any of its Subsidiaries or (iii) result in the violation of any law, statute, rule, regulation, judgment, order or decree of any court or governmental or regulatory agency or body, domestic or foreign, having jurisdiction over the Company or any of its Subsidiaries or any of their properties or assets except, in the case of clauses (i) and (iii) above, for any such conflict, breach, violation or default that would not, individually or in the aggregate, have a Material Adverse Effect. A "***Debt Repayment Triggering Event***" means any event or condition that gives, or with the giving of notice or lapse of time would give the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder's behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company of any of its Subsidiaries.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) <u>No Consents Required</u>. To the Company's Knowledge, except as may be required under the Securities Act or applicable state securities laws, and such consents, approvals, authorizations, orders and registrations or qualifications as may be required by the Financial Industry Regulatory Authority ("***FINRA***") and the Nasdaq Capital Market (the "***Exchange***") in connection with the purchase and distribution of the Securities by the Underwriters, no consent, approval, authorization or order of, or filing, qualification or registration (each an "***Authorization***") with, any court, governmental or regulatory agency or body, foreign or domestic, which has not been made, obtained or taken and is not in full force and effect, is required for the execution, delivery and performance of this Agreement by the Company, the issuance and sale of the Securities or the consummation of the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) <u>Independent Auditors</u>. Grant Thornton LLP, whose reports on the consolidated financial statements of the Company are filed with the Commission as part of the Company's most recent Annual Report on Form 10-K and/or included or incorporated by reference in the Registration Statement, the Time of Sale Prospectus and the Prospectus, is an independent registered public accounting firm with respect to the Company and its Subsidiaries within the meaning of Article 2-01 of Regulation S-X and the Public Company Accounting Oversight Board (United States) (the "***PCAOB***").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) <u>SEC Reports; Financial Statements</u>. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the 12 months preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein, together with the Time of Sale Prospectus and the Prospectus, being collectively referred to herein as the "***SEC Reports***") on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied as to form in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The Company has never been an issuer subject to Rule 144(i) under the Securities Act. The financial statements of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods involved ("***GAAP***"), except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) <u>eXtensible Business Reporting Language</u>. The interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement fairly presents in all material respects the information called for in all material respects and has been prepared in accordance with the Commission's rules and guidelines applicable thereto.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) <u>Material Changes; Undisclosed Events, Liabilities or Developments</u>. Since the date of the latest audited financial statements included within the SEC Reports, except as disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) there has been no event, occurrence or development that has had or that could reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not required to be reflected in the Company's financial statements pursuant to GAAP or disclosed in filings made with the Commission, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock and (v) the Company has not issued any equity securities to any officer, director or affiliate, except pursuant to existing Company stock option plans. The Company does not have pending before the Commission any request for confidential treatment of information. Except for the issuance of the Securities contemplated by this Agreement or as disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus, no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made that has not been publicly disclosed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t) <u>Litigation</u>. Except as disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus, there is no material action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the Company's Knowledge, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an "***Action***"). There are no Actions involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty required to be disclosed that are not so disclosed in the Registration Statement, Time of Sale Prospectus and the Prospectus. There has not been, and to the Company's Knowledge, there is not pending or contemplated, any investigation by the Commission involving the Company or any current or former director or officer of the Company. The Commission has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u) <u>Tests and Preclinical and Clinical Trials</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The studies, tests and preclinical and clinical trials conducted by or, to the Company's Knowledge, on behalf of the Company or its Subsidiaries were and, if still pending, are being, conducted in all material respects in accordance with the protocols submitted to the U.S. Food and Drug Administration (the "***FDA***") or any foreign governmental body exercising comparable authority over such studies, tests and trials (together, the "***Regulatory Authorities***"), standard medical and scientific research standards and procedures for products or product candidates comparable to those being developed by the Company, all applicable Health Care Laws (as defined below) and any applicable rules and regulations enforced by the FDA or other Regulatory Authorities and applicable Good Clinical Practice and Good Laboratory Practice requirements; the descriptions of the studies, tests and preclinical and clinical trials conducted by or, to the Company's Knowledge, on behalf of the Company or its Subsidiaries, contained in the SEC Reports are accurate in all material respects; the Company has no Knowledge of any other studies, tests or preclinical and clinical trials, the results of which call into question the results described in the SEC Reports; and the Company has not received any written notices or correspondence from the Regulatory Authorities or any Institutional Review Board requiring the termination, suspension, or clinical hold of any studies, tests or preclinical or clinical trials conducted by or on behalf of the Company.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) ****"***Health Care Laws***" means all applicable laws, rules and regulations relating to the provision and/or administration of, and/or payment for, health care services, items and supplies including, without limitation, applicable laws, rules and regulations related to: (a) fraud and abuse, including, without limitation, the federal Anti-Kickback Statute (42 U.S.C. §1320a-7b(b)), the Anti-Inducement Law (42 U.S.C. Section 1320a-7a(a)(5)), the civil False Claims Act (31 U.S.C. §§ 3729 et seq.), the criminal False Claims Act 18 U.S.C. §§ 286 and 287, the administrative False Claims Law (42 U.S.C. Section 1320a-7b(a)), the False Statements Relating to Health Care Matters Act (18 U.S.C. § 1035), the Health Care Fraud Act (18 U.S.C. § 1347), the Program Fraud Civil Remedies Act (31 U.S.C. §§ 3801-3812), the Anti-Kickback Act of 1986 (41 U.S.C. §§ 51-58), the laws regarding Exclusion and Civil Monetary Penalties (42 U.S.C. §§ 1320a-7, 1320a-7a and 1320a-7b), and any state, commonwealth or local laws similar to any of the foregoing; (b) Medicare (Title XVIII of the Social Security Act), Medicaid (Title XIX of the Social Security Act), CHAMPVA, TRICARE, the State Children's Health Insurance Program (Title XXI of the Social Security Act), and any other third party payor programs; (c) HIPAA (as defined below); (d) the Physician Payments Sunshine Act (42 U.S.C. Section 1320a-7h); and (e) the Federal Food Drug and Cosmetic Act (21 U.S.C. §§ 301 et seq.), each of the laws, rules and regulations referred to in clauses (a) through (e) as may be amended, modified or supplemented from time to time and any successor statutes thereto and regulations promulgated thereunder from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) ****"***HIPAA***" means the (a) Health Insurance Portability and Accountability Act of 1996; (b) the Health Information Technology for Economic and Clinical Health Act (Title XIII of the American Recovery and Reinvestment Act of 2009); and (c) any federal, state and local laws regulating the privacy and/or security of individually identifiable health information, including, without limitation, state laws providing for notification of breach of privacy or security of individually identifiable health information, in each case with respect to the applicable laws described in clauses (a), (b) and (c) of this definition, as the same may be amended, modified or supplemented from time to time, any successor statutes thereto, any and all rules or regulations promulgated from time to time thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) <u>No Violation or Default</u>. Neither the Company nor any of its Subsidiaries is (i) in violation of its charter or bylaws (or analogous governing instrument, as applicable), (ii) in default in any respect, and no event has occurred which, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement, lease or other agreement or instrument to which it is a party or by which it is bound or to which any of its property or assets is subject or (iii) in violation in any respect of any law, ordinance, governmental rule, regulation or court order, decree or judgment to which it or its property or assets may be subject (including, without limitation, those administered by the FDA or by any foreign, federal, state or local governmental or regulatory authority performing functions similar to those performed by the FDA) except, in the case of clauses (ii) and (iii) above, for any such violation or default that would not, singularly or in the aggregate, have a Material Adverse Effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(w) <u>Permits</u>. The Company and its Subsidiaries possess adequate certificates, authorities or permits issued by appropriate governmental agencies or bodies necessary to conduct the business now operated by them, except where failure to so possess would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect. The Company and its Subsidiaries have not received any notice of proceedings relating to the revocation or modification of any such certificate, authority or permit that, if determined adversely to the Company or its Subsidiaries, would reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) <u>Reserved</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(y) <u>Regulatory Compliance</u>. Except in each case as would not have or reasonably be expected to result in a Material Adverse Effect: (A) during the past three (3) years, there has not been any violation of any applicable Health Care Laws by the Company or any of its Subsidiaries; (B) to the Company's Knowledge, there are no civil or criminal proceedings relating to the Company, any of its Subsidiaries or any officer, director or employee of the Company or any of its Subsidiaries that involve a matter within or related to any governmental or regulatory authority's jurisdiction or any allegations of non-compliance with Health Care Laws; and (C) during the past three (3) years, neither the Company nor any of its Subsidiaries nor any Affiliate thereof has received any written adverse notice from any governmental or regulatory authority (including without limitation the United States Food and Drug Administration or any foreign equivalent, the U.S. Federal Trade Commission, the United States Centers for Medicare & Medicaid Services, HHS's Office of Inspector General, the U.S. Department of Justice and state Attorneys General or similar agencies) alleging non-compliance with Health Care Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(z) <u>Investment Company Act</u>. Neither the Company nor any Subsidiary is or, after giving effect to the offering of the Securities and the application of the proceeds thereof as described in the General Disclosure Package and the Prospectus, will be required to register as an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(aa) <u>No Stabilization</u>. Neither the Company nor, to the Company's Knowledge, any of its officers, directors or affiliates has taken or will take, directly or indirectly, any action designed or intended to stabilize or manipulate the price of any security of the Company, or which caused or resulted in, or which might in the future reasonably be expected to cause or result in, stabilization or manipulation of the price of any security of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(bb) <u>Intellectual Property</u>. The Company and its Subsidiaries own, possess, license or have other rights to use, the patents and patent applications, copyrights, trademarks, service marks, trade names, service names and trade secrets necessary or material for use in connection with its businesses as currently conducted as described in the SEC Reports (collectively, the "***Intellectual Property Rights***"). Except as disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus, there is no pending or, to the Company's Knowledge, threatened action, suit, proceeding, claim or basis for a claim by any Person that the Company's Intellectual Property Rights or its business or the business of its Subsidiaries as now conducted infringes or otherwise violates any patent, trademark, copyright, trade secret or other proprietary rights of another. Except as disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus, to the Company's Knowledge, there is no existing infringement by another Person of any of the Intellectual Property Rights that would have or would reasonably be expected to have a Material Adverse Effect. The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of its Intellectual Property Rights, except where the failure to do so would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. All material licenses or other material agreements under which the Company is granted rights to Intellectual Property Rights are, to the Company's Knowledge, in full force and effect and, to the Company's Knowledge, there is no material default by any other party thereto, except as would not reasonably be expected to have a Material Adverse Effect. The Company has no reason to believe that the licensors under such licenses and other agreements do not have and did not have all requisite power and authority to grant the rights to the Intellectual Property Rights purported to be granted thereby. The consummation of the transactions contemplated hereby and by the other Transaction Documents will not result in the alteration, loss, impairment of or restriction on the Company's or any of its Subsidiaries' ownership or right to use any Intellectual Property Right that is material to the conduct of the Company's business as currently conducted.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(cc) <u>Reserved</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(dd) <u>IT Systems</u>. (i)(x)To the Company's Knowledge, there has been no material security breach or other compromise of or relating to any of the Company's and its Subsidiaries' information technology and computer systems, networks, hardware, software, data (including the data of their respective customers, employees, suppliers, vendors and any third party data maintained by or on behalf of them), equipment or technology ("***IT Systems and Data***"), and (y) the Company and its Subsidiaries have not been notified of, and have no Knowledge of any event or condition that would reasonably be expected to result in any material security breach or compromise to their IT Systems and Data, (ii) except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, the Company and its Subsidiaries have complied, and are presently in compliance with, in all material respects, all applicable laws, statutes or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority and all industry guidelines, standards, internal policies and contractual obligations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification and (iii) the Company and its Subsidiaries have implemented backup and disaster recovery technology consistent with industry standards and practice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ee) <u>Title to Properties</u>. Except as disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus, the Company and its Subsidiaries have good and marketable title to all real properties and all other tangible properties and assets owned by them as described in the SEC Reports, in each case free from Liens and defects, except such as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect; and the Company and its Subsidiaries hold any leased real or personal property under valid, subsisting and enforceable leases with which the Company are in compliance and with no exceptions, except such as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect. "***Liens***" means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ff) <u>Labor Relations.</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Neither the Company nor its Subsidiaries are parties to or bound by any collective bargaining agreements or other agreements with labor organizations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) No labor dispute with the employees of the Company or any of its Subsidiaries, or with the employees of any principal supplier, manufacturer, customer or contractor of the Company, exists or, to the Company's Knowledge, is threatened or imminent that would reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(gg) <u>Compliance with ERISA</u>. To the Company's Knowledge, no "prohibited transaction" (as defined in Section 406 of the Employee Retirement Income Security Act of 1974, as amended, including the regulations and published interpretations thereunder ("***ERISA***"), or Section 4975 of the Internal Revenue Code of 1986, as amended from time to time (the "***Code***")) or "accumulated funding deficiency" (as defined in Section 302 of ERISA) or any of the events set forth in Section 4043(b) of ERISA (other than events with respect to which the thirty (30)-day notice requirement under Section 4043 of ERISA has been waived) has occurred or could reasonably be expected to occur with respect to any employee benefit plan of the Company or any of its Subsidiaries which could, singularly or in the aggregate, have a Material Adverse Effect. Each employee benefit plan of the Company or any of its Subsidiaries is in material compliance in all material respects with applicable law, including ERISA and the Code. The Company and its Subsidiaries have not incurred and could not reasonably be expected to incur material liability under Title IV of ERISA with respect to the termination of, or withdrawal from, any pension plan (as defined in ERISA). Each pension plan for which the Company or any of its Subsidiaries would have any material liability that is intended to be qualified under Section 401(a) of the Code is so qualified, and nothing has occurred, whether by action or by failure to act, which could, singularly or in the aggregate, cause the loss of such qualification.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(hh) <u>Environmental Laws</u>. Except as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, neither the Company nor any of its Subsidiaries is in violation of any statute, rule, regulation, decision or order of any governmental agency or body or any court, domestic or foreign, relating to the use, disposal or release of hazardous or toxic substances or relating to the protection or restoration of the environment or human exposure to hazardous or toxic substances (collectively, "***Environmental Laws***"), has released any hazardous substances regulated by Environmental Law on to any real property that it owns or operates, or has received any written notice or claim it is liable for any off-site disposal or contamination pursuant to any Environmental Laws; and to the Company's Knowledge, there is no pending or threatened investigation that would reasonably be expected to lead to such a claim.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Taxes</u>. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(jj) <u>Insurance</u>. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited to, directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(kk) <u>Accounting Controls</u>. The Company and each of its Subsidiaries maintain a system of "internal control over financial reporting" (as such term is defined in Rule 13a-15(f) of the General Rules and Regulations under the Exchange Act (the "***Exchange Act Rules***")) sufficient to comply with the requirements of the Exchange Act and has been designed by their respective principal executive and principal financial officers, or under their supervision, to provide reasonable assurances that: (i) transactions are executed in accordance with management's general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management's general or specific authorization; (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (v) interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement fairly presents in all material respects the Commission's rules and guidelines applicable thereto. The Company's internal control over financial reporting is effective and none of the Company, its board of directors and audit committee is aware of any "significant deficiencies" or "material weaknesses" (each as defined by the PCAOB) in its internal control over financial reporting, or any fraud, whether or not material, that involves management or other employees of the Company and its Subsidiaries who have a significant role in the Company's internal controls. Except as described in the General Disclosure Package, since the end of the Company's most recent audited fiscal year, there has been (A) no material weakness in the Company's internal control over financial reporting (whether or not remediated) and (B) no change in the Company's internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ll) <u>Disclosure Controls</u>. The Company and its subsidiaries maintain disclosure controls and procedures (as such is defined in Rule 13a-15(e) of the Exchange Act Rules) that are sufficient to comply with the requirements of the Exchange Act; such disclosure controls and procedures have been designed to ensure that information required to be disclosed by the Company and its subsidiaries in reports that they file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission's rules and forms, including controls and procedures designed to ensure that such information is accumulated and communicated to the Company's management to allow timely decisions regarding disclosures. The Company and its subsidiaries have conducted evaluations of the effectiveness of their disclosure controls as required by Rule 13a-15 of the Exchange Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(mm) <u>No Undisclosed Relationships</u>. No relationship, direct or, to the Company's Knowledge, indirect, exists between or among the Company or any of its subsidiaries on the one hand, and the directors, officers, stockholders (or analogous interest holders), customers or suppliers of the Company or any of its affiliates on the other hand, which is required to be described in the General Disclosure Package and the Prospectus or a document incorporated by reference therein and which is not so described.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(nn) <u>No Registration Rights</u>. Except as otherwise disclosed in the General Disclosure Package and the Prospectus, no person or entity has the right to require registration of shares of Common Stock or other securities of the Company or any of its subsidiaries because of the filing or effectiveness of the Registration Statement or otherwise, except for persons and entities who have expressly waived such right in writing or who have been given timely and proper written notice and have failed to exercise such right within the time or times required under the terms and conditions of such right.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(oo) <u>Margin Rules</u>. The application of the proceeds received by the Company from the issuance, sale and delivery of the Securities as described in the General Disclosure Package and the Prospectus will not violate Regulation T, U or X of the Board of Governors of the Federal Reserve system or any other regulation of such Board of Governors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(pp) <u>No Broker</u><u>'</u><u>s Fees</u>. Other than fees payable to the underwriting syndicate as set forth in this Agreement, neither the Company nor any of its subsidiaries is a party to any contract, agreement or understanding with any person (other than this Agreement) that would give rise to a valid claim against the Company or any of its subsidiaries or the Underwriters for a brokerage commission, finder's fee or like payment in connection with the offering and sale of the Securities or any transaction contemplated by this Agreement, the Registration Statement, the General Disclosure Package and the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(qq) <u>No Restrictions on Subsidiaries</u>. Except as described in the General Disclosure Package and the Prospectus, no Subsidiary of the Company is currently prohibited, directly or indirectly, under any agreement or other instrument to which it is a party or is subject, from paying any dividends to the Company, from making any other distribution on such Subsidiary's capital stock, from repaying to the Company any loans or advances to such subsidiary from the Company or from transferring any of such Subsidiary's properties or assets to the Company or any other subsidiary of the Company.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(rr) <u>Forward-Looking Statements</u>. No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) contained in either the General Disclosure Package or the Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ss) <u>Listing</u>. The Company is subject to and in compliance in all material respects with the reporting requirements of Section 13 or Section 15(d) of the Exchange Act. The Common Stock is registered pursuant to Section 12(b) of the Exchange Act and is listed on the Exchange, and the Company has taken no action designed to, or reasonably likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act or delisting the Common Stock from the Exchange, nor has the Company received any notification that the Commission or FINRA is contemplating terminating such registration or listing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(tt) <u>Sarbanes-Oxley Act</u>. The Company is in material compliance with all applicable provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations of the Commission thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(uu) <u>No Unlawful Payments</u>. Neither the Company nor any of its subsidiaries nor, to the Company's Knowledge, any director, officer, employee, agent, affiliate or other person acting on behalf of the Company or any subsidiary, has (i) used any corporate funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity, (ii) made any direct or indirect unlawful payment to foreign or domestic government officials or employees, political parties or campaigns, political party officials, or candidates for political office from corporate funds, (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or any applicable anti-corruption laws, rules, or regulation of any other jurisdiction in which the Company or any subsidiary conducts business, or (iv) made any other unlawful bribe, rebate, payoff, influence payment, kickback, or other unlawful payment to any person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vv) <u>Statistical and Market Data</u>. Nothing has come to the attention of the Company that has caused the Company to believe that any third-party statistical and market related data included in the Registration Statement, the General Disclosure Package and the Prospectus are based on or derived from sources that are not reliable and accurate in all material respects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ww) <u>Compliance with Money Laundering Laws</u>. The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with all applicable financial recordkeeping and reporting requirements, including those of the U.S. Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where the Company and its subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the "***Anti-Money Laundering Laws***"), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the Company's Knowledge, threatened.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xx) <u>Office of Foreign Assets Control</u>. Neither the Company nor any Subsidiary nor, to the Company's Knowledge, any director, officer, agent, employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department ("***OFAC***").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(yy) <u>No Associated Persons; FINRA Matters</u>. Neither the Company nor any of its affiliates (within the meaning of FINRA Rule 5121(f)(1)) directly or indirectly controls, is controlled by, or is under common control with, or is an associated person (within the meaning of Article I, Section 1(ee) of the By-laws of FINRA) of, any member firm of FINRA. The Company is an "experienced issuer" within the meaning of FINRA Rule 5110(j)(6).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(zz) <u>No Acquisitions or Dispositions</u>. Except as are described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, there are no contracts, letters of intent, term sheets, agreement, arrangements or understandings with respect to the direct or indirect acquisition or disposition by the Company of material interests in real or personal property.

Any certificate signed by or on behalf of the Company and delivered to the Representative or to counsel for the Underwriters shall be deemed to be a representation and warranty by the Company to each Underwriter as to the matters covered thereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.* *P urchase, Sale and Delivery of Offered Securities*. On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company agrees to sell to the Underwriters, and the Underwriters agree, severally and not jointly, to purchase from the Company the respective numbers of Firm Securities set forth opposite the names of the Underwriters in <u>Schedule A</u> hereto.

The purchase price per share to be paid by the Underwriters to the Company for the Firm Stock and/or Optional Stock will be $[•] per share (the "***Share Purchase Price***").

The Company will deliver the Firm Stock to the Representative for the respective accounts of the several Underwriters, through the facilities of The Depository Trust Company, issued in such names and in such denominations as the Representative may direct by notice in writing to the Company given at or prior to 12:00 Noon, New York time, on the first (1<sup>st</sup>) full business day preceding the Closing Date, against payment of the aggregate Share Purchase Price therefor by wire transfer in federal (same day) funds to an account at a bank specified by the Company payable to the order of the Company. Time shall be of the essence, and delivery at the time and place specified pursuant to this Agreement is a further condition of the obligations of each Underwriter hereunder. The time and date of the delivery and closing shall be at [•] A.M., New York time, on [•], 2025, in accordance with Rule 15c6-1 of the Exchange Act. The time and date of such payment and delivery are herein referred to as the "***Closing Date***." The Closing Date and the location of delivery of, and the form of payment for, the Firm Securities may be varied by agreement between the Company and the Representative.

The Underwriters may purchase all or less than all of the Optional Securities for use solely in covering any over-allotments made by the Underwriters in the sale and distribution of the Firm Securities. The price per share of Optional Stock and Optional Pre-Funded Warrant to be paid for the Optional Stock and/or Optional Pre-Funded Warrant shall be the Share Purchase Price and/or the Pre-Funded Warrant Purchase Price (as defined below), as applicable. The Company agrees to sell to the Underwriters the number of Optional Securities specified in the written notice delivered by the Representative to the Company described below and the Underwriters agree, severally and not jointly, to purchase such Optional Securities. Such Optional Securities shall be purchased from the Company for the account of each Underwriter in the same proportion as the number of Firm Securities set forth opposite such Underwriter's name on <u>Schedule A</u> bears to the total number of Firm Securities (subject to adjustment by the Representative to eliminate fractions). The option granted hereby may be exercised as to all or any part of the Optional Securities at any time, and from time to time; <u>provided</u>, <u>however</u>, that notice of such exercise must be delivered not more than thirty (30) days subsequent to the date of this Agreement. No Optional Securities shall be sold and delivered unless the Firm Securities previously have been, or simultaneously are, sold and delivered. The right to purchase the Optional Securities or any portion thereof may be surrendered and terminated at any time upon notice by the Representative to the Company.

The option granted hereby shall be exercised by written notice being given to the Company by the Representative setting forth the number of Optional Securities to be purchased by the Underwriters and the date and time for delivery of and payment for the Optional Securities. Each date and time for delivery of and payment for the Optional Securities (which may be the Closing Date, but not earlier) is herein called the "***Option Closing Date***" and shall in no event be earlier than one (1) business day nor later than five (5) business days after written notice is given. The Option Closing Date and the Closing Date are herein called the "***Closing Dates***."

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The Company will deliver the Optional Shares to the Representative for the respective accounts of the several Underwriters through the facilities of The Depository Trust Company, issued in such names and in such denominations as the Representative may direct by notice in writing to the Company given at or prior to 12:00 Noon, New York time, on the first (1<sup>st</sup>) full business day preceding the Option Closing Date, against payment of the aggregate Share Purchase Price therefor by wire transfer in federal (same day) funds to an account at a bank acceptable to the Representative payable to the order of the Company. Time shall be of the essence, and delivery at the time and place specified pursuant to this Agreement is a further condition of the obligations of each Underwriter hereunder. The Option Closing Date and the location of delivery of, and the form of payment for, the Optional Securities may be varied by agreement between the Company and the Representative.

Notwithstanding the foregoing, the Company and the Representative shall instruct purchasers of the Firm Pre-Funded Warrants and/or Optional Pre-Funded Warrants in the offering to make payment for the Firm Pre-Funded Warrants and/or Optional Pre-Funded Warrants prior to the Closing Date and/or Option Closing Date, as applicable, to the Company by wire transfer in immediately available funds to the account specified by the Company at a purchase price of $[•] (the "***Pre-Funded Warrant Purchase Price***"), in lieu of payment by the Underwriters for such Firm Pre-Funded Warrants and/or Optional Pre-Funded Warrants, and the Company shall deliver, or cause to be delivered, the Firm Pre-Funded Warrants and/or Optional Pre-Funded Warrants to such purchasers at the Closing Date or Option Closing Date, as applicable, in definitive form and registered in such names and in such denominations as the Representative shall request in writing before the Closing Date or Option Closing Date, as applicable, against such payment, in lieu of the Company's obligation to deliver such Firm Pre-Funded Warrants and/or Optional Pre-Funded Warrants to the Underwriters; provided, that, the Representative shall withhold $[•] per Pre-Funded Warrant with respect to such Pre-Funded Warrants as an offset against the payment owed by the Representative to the Company with respect to the Securities hereunder. In the event that the purchasers of the Firm Pre-Funded Warrants and/or Optional Pre-Funded Warrants fail to make payment to the Company for all or part of the Firm Pre-Funded Warrants and/or Optional Pre-Funded Warrants at the Closing Date or Option Closing Date, as applicable, the Representative may elect, by written notice to the Company, to purchase additional Firm Stock or Optional Stock, as applicable, in lieu of all or a portion of such Firm Pre-Funded Warrants or Optional Pre-Funded Warrants, as applicable, to be delivered to the Underwriters under this Agreement at the price per Firm Share listed in Section 3 hereof at the applicable Closing in the manner contemplated herein in connection with the issuance and purchase of Firm Stock. The Pre-Funded Warrants will be made available for inspection by the Representative on the business day prior to the Closing Date.

The several Underwriters propose to offer the Securities for sale upon the terms and conditions set forth in the Prospectus.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*4.* *Further Agreements of the Company.* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Company agrees with the several Underwriters:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Required Filings; Amendments or Supplements; Notice to the Representative</u>. During the period beginning on the date hereof and ending on the later of the Option Closing Date or such date, as in the opinion of counsel for the Underwriters, the Prospectus is no longer required by law to be delivered (assuming the absence of Rule 172 under the Securities Act), in connection with sales by an Underwriter or a dealer (the "***Prospectus Delivery Period***"), prior to amending or supplementing the Registration Statement (including any Rule 462(b) Registration Statement), the General Disclosure Package or the Prospectus, the Company shall furnish to the Underwriters for review a copy of each such proposed amendment or supplement, and the Company shall not file any such proposed amendment or supplement to which the Underwriters or counsel to the Underwriters reasonably object. Subject to this <u>Section</u><u> </u><u>4(i)(a)</u>, immediately following execution of this Agreement, the Company will prepare the Prospectus containing the Rule 430A Information and other selling terms of the Securities, the plan of distribution thereof and such other information as may be required by the Securities Act or the Rules and Regulations or as the Underwriters and the Company may deem appropriate, and if requested by the Underwriters, an issuer free writing prospectus containing the selling terms of the Securities and such other information as the Company and the Underwriters may deem appropriate, and will file or transmit for filing with the Commission, in accordance with Rule 424(b) or Rule 433 of the Rules and Regulations, as the case may be, copies of the Prospectus and each issuer free writing prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Permitted Free Writing Prospectus</u>. The Company represents and agrees that, unless it obtains the prior consent of the Representative, and each Underwriter represents and agrees that, unless it obtains the prior consent of the Company and the Representative, it has not made and will not make (other than a filing pursuant to <u>Section</u><u> </u><u>4(i)(a)</u> hereof) any offer relating to the Securities that would constitute a "free writing prospectus" as defined in Rule 405 of the Rules and Regulations unless the prior written consent of the Representative has been received (each, a "***Permitted Free Writing Prospectus***"); <u>provided</u> that the prior written consent of the Representative hereto shall be deemed to have been given in respect of the Issuer Free Writing Prospectuses included in <u>Schedule B</u> hereto. The Company represents that it has treated and agrees that it will treat each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus, comply with the requirements of Rules 164 and 433 of the Rules and Regulations applicable to any Issuer Free Writing Prospectus, including the requirements relating to timely filing with the Commission, legending and record keeping and will not take any action that would result in an Underwriter or the Company being required to file with the Commission pursuant to Rule 433(d) of the Rules and Regulations a free writing prospectus prepared by or on behalf of such Underwriter that such Underwriter otherwise would not have been required to file thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Ongoing Compliance</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) During the Prospectus Delivery Period, the Company will comply with all requirements imposed upon it by the Securities Act, as now and hereafter amended, and by the Rules and Regulations, as from time to time in force, and by the Exchange Act so far as necessary to permit the continuance of sales of or dealings in the Securities as contemplated by the provisions hereof, the General Disclosure Package and the Prospectus. If during such period any event occurs as a result of which the Prospectus (or if the Prospectus is not yet available to prospective purchasers, the General Disclosure Package) would include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances then existing, not misleading, or if during such period it is necessary or appropriate in the opinion of the Company or its counsel or the Underwriters or counsel to the Underwriters to amend the Registration Statement or supplement the Prospectus (or, if the Prospectus is not yet available to prospective purchasers, the General Disclosure Package) to comply with the Securities Act or to file under the Exchange Act any document which would be deemed to be incorporated by reference in the Prospectus (or if the Prospectus is not yet available to prospective purchasers, the General Disclosure Package) in order to comply with the Securities Act or the Exchange Act, the Company promptly will (x) notify you of such untrue statement or omission, (y) amend the Registration Statement or supplement the Prospectus (or, if the Prospectus is not yet available to prospective purchasers, the General Disclosure Package) or file such document (at the expense of the Company) so as to correct such statement or omission or effect such compliance, and (z) notify you when any amendment to the Registration Statement is filed or becomes effective or when any supplement to the Prospectus (or, if the Prospectus is not yet available to prospective purchasers, the General Disclosure Package) is filed.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) During the Prospectus Delivery Period, if at any time following issuance of an Issuer Free Writing Prospectus there occurred or occurs an event or development as a result of which such Issuer Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement, the Preliminary Prospectus or the Prospectus or included or would include, when taken together with the General Disclosure Package, an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances prevailing at that subsequent time, not misleading, the Company (x) has promptly notified or promptly will notify the Underwriters of such conflict, untrue statement or omission, (y) has promptly amended or will promptly amend or supplement, at its own expense, such issuer free writing prospectus to eliminate or correct such conflict, untrue statement or omission, and (z) has notified or promptly will notify you when such amendment or supplement was or is filed with the Commission where so required to be filed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Delivery of Registration Statement</u>. To the extent not available on the Commission's Electronic Data Gathering, Analysis and Retrieval system or any successor system ("***EDGAR***"), upon the request of the Representative, to furnish promptly to the Representative and to counsel for the Underwriters a signed copy of the Registration Statement as originally filed with the Commission, and of each amendment thereto filed with the Commission, including all consents and exhibits filed therewith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Delivery of Copies</u>. Upon request of the Representative, to the extent not available on EDGAR, to deliver promptly to the Representative in New York City such number of the following documents as the Representative shall reasonably request: (i) conformed copies of the Registration Statement as originally filed with the Commission (in each case excluding exhibits), (ii) each Preliminary Prospectus, (iii) any Issuer Free Writing Prospectus, (iv) the Prospectus (the delivery of the documents referred to in clauses (i), (ii), (iii) and (iv) of this paragraph (e) to be made not later than 10:00 A.M., New York time, on the business day following the execution and delivery of this Agreement), (v) conformed copies of any amendment to the Registration Statement (excluding exhibits), (vi) any amendment or supplement to the General Disclosure Package or the Prospectus (the delivery of the documents referred to in clauses (v) and (vi) of this paragraph (e) to be made not later than 10:00 A.M., New York City time, on the business day following the date of such amendment or supplement), and (vii) any document incorporated by reference in the General Disclosure Package or the Prospectus (excluding exhibits thereto) (the delivery of the documents referred to in clause (vi) of this paragraph (e) to be made not later than 10:00 A.M., New York City time, on the business day following the date of such document).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Earnings Statement</u>. To make generally available (which may be satisfied by filing with the Commission's EDGAR system) to its stockholders as soon as practicable, but in any event not later than fifteen (15) months after the effective date of the Registration Statement (as defined in Rule 158(c) of the Rules and Regulations), an earnings statement of the Company and its subsidiaries (which need not be audited) complying with Section 11(a) of the Securities Act (including, at the option of the Company, Rule 158).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Blue Sky Compliance</u>. To take promptly from time to time such actions as the Representative may reasonably request to qualify the Securities for offering and sale under the securities or Blue Sky laws of such jurisdictions (domestic or foreign) as the Representative may reasonably designate and to continue such qualifications in effect, and to comply with such laws, for so long as required to permit the offer and sale of Securities in such jurisdictions; <u>provided</u> that the Company and its subsidiaries shall not be obligated to (i) qualify as foreign corporations in any jurisdiction in which they are not so qualified, (ii) file a general consent to service of process in any jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Reports</u>. Upon request, during the period of two (2) years from the date hereof, to deliver to each of the Underwriters, (i) as soon as they are available, copies of all reports or other communications (financial or other) furnished to stockholders, and (ii) as soon as they are available, copies of any reports and financial statements furnished or filed with the Commission or any national securities exchange on which the Common Stock is listed. However, so long as the Company is subject to the reporting requirements of either Section 13 or Section 15(d) of the Exchange Act and is timely filing reports with the Commission on EDGAR, it is not required to furnish such reports or statements to the Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Lock-Up</u>. During the period commencing on and including the date hereof and ending on and including the ninetieth (90th) day following the date of this Agreement (the "***Lock-Up Period***"), the Company will not, without the prior written consent of the Representative, directly or indirectly offer, sell (including, without limitation, any short sale), assign, transfer, pledge, contract to sell, establish an open "put equivalent position" within the meaning of Rule 16a-1(h) under the Exchange Act, or otherwise dispose of, or announce the offering of, or submit or file any registration statement under the Securities Act in respect of, any Common Stock, options, rights or warrants to acquire Common Stock or securities exchangeable or exercisable for or convertible into Common Stock (other than is contemplated by this Agreement with respect to the Firm Stock and Optional Stock) or publicly announce any intention to do any of the foregoing; <u>provided</u>, <u>however</u>, that the Company may: (i) issue Common Stock and options to purchase Common Stock, shares of Common Stock underlying options granted and other securities, each pursuant to any director or employee stock option plan, stock ownership plan or dividend reinvestment plan of the Company in effect on the date hereof and described in the General Disclosure Package; (ii) issue Common Stock pursuant to the conversion of securities or the exercise of warrants, which securities or warrants are outstanding on the date hereof and described in the General Disclosure Package; (iii) sell or issue, or enter into an agreement to sell or issue, Common Stock or securities convertible into or exercisable or exchangeable for Common Stock in connection with (1) mergers, (2) acquisition of securities, businesses, property or other assets, (3) joint ventures or (4) strategic alliances; <u>provided</u> that each recipient of Common Stock or securities convertible into or exercisable for Common Stock pursuant to this clause and such securities are issued as "restricted securities" (as defined in Rule 144 of the Securities Act), (iii) shall execute a "lock-up agreement" substantially in the form of <u>Exhibit I</u> hereto for the same length of time as the Lock-Up Period; or (iv) adopt a new equity incentive plan, and file a registration statement on Form S-8 under the Securities Act to register the offer and sale of securities to be issued pursuant to such new equity incentive plan, and issue securities pursuant to such new equity incentive plan (including, without limitation, the issuance of shares of Common Stock upon the exercise of options or other securities issued pursuant to such new equity incentive plan), <u>provided</u> that (1) such new equity incentive plan satisfies the transaction requirements of General Instruction A.1 of Form S-8 under the Securities Act and (2) this clause (iv) shall not be available unless each recipient set forth on <u>Schedule D</u> of shares of Common Stock, or securities exchangeable or exercisable for or convertible into Common Stock, pursuant to such new equity incentive plan shall be contractually prohibited from selling, offering, disposing of or otherwise transferring any such shares or securities during the remainder of the Lock-Up Period. The Company will cause each person and entity listed in <u>Schedule D</u> to furnish to the Representative, prior to the Closing Date, a "lock-up" agreement, substantially in the form of <u>Exhibit I</u> hereto. In addition, the Company will direct the transfer agent to place stop transfer restrictions upon any such securities of the Company that are bound by such "lock-up" agreements for the duration of the periods contemplated in such agreements.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Delivery of SEC Correspondence</u>. During the Prospectus Delivery Period, to supply the Underwriters with copies of all correspondence to and from, and all documents issued to and by, the Commission in connection with the registration of the Securities under the Securities Act or any of the Registration Statement, any Preliminary Prospectus or the Prospectus, or any amendment or supplement thereto or document incorporated by reference therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) <u>Press Releases</u>. Prior to the Closing Date, not to issue any press release or other communication directly or indirectly or hold any press conference with respect to the Company, its condition, financial or otherwise, or earnings, business affairs or business prospects (except for routine oral marketing communications in the ordinary course of business and consistent with the past practices of the Company and of which the Representative is notified), without the prior consent of the Representative (which consent shall not be unreasonably withheld), unless in the judgment of the Company and its counsel, and after notification to the Representative, such press release or communication is required by law or applicable Exchange rules.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) <u>Compliance with Regulation M</u>. Until the Underwriters shall have notified the Company of the completion of the resale of the Firm Stock or Optional Stock, as applicable, that the Company will not, and will use its reasonable best efforts to cause its affiliated purchasers (as defined in Regulation M under the Exchange Act) not to, either alone or with one or more other persons, bid for or purchase, for any account in which it or any of its affiliated purchasers has a beneficial interest, any Firm Stock or Optional Stock, or attempt to induce any person to purchase any Firm Stock or Optional Stock; and not to, and to use its reasonable best efforts to cause its affiliated purchasers not to, make bids or purchase for the purpose of creating actual, or apparent, active trading in or of raising the price of the Firm Stock or Optional Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) <u>Registrar and Transfer Agent</u>. To maintain, at its expense, a registrar and transfer agent for the Common Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) <u>Use of Proceeds</u>. To apply the net proceeds from the sale of the Securities as set forth in the Registration Statement, the General Disclosure Package and the Prospectus under the heading "Use of Proceeds," and except as disclosed in the General Disclosure Package, the Company does not intend to use any of the proceeds from the sale of the Securities hereunder to repay any outstanding debt owed to any affiliate of any Underwriter and shall not use such proceeds in violation of the Foreign Corrupt Practices Act of 1977, as amended or OFAC regulations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) <u>Exchange Listing</u>. To use its reasonable best efforts to list, subject to notice of issuance, the Firm Stock and Optional Stock on the Exchange.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) <u>Performance of Covenants and Satisfaction of Conditions</u>. To use its reasonable best efforts to do and perform all things required to be done or performed under this Agreement by the Company prior to each Closing Date and to satisfy all conditions precedent to the delivery of the Securities.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*5.* *Payment of Expenses*.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Company agrees to pay, or reimburse if paid by any Underwriter, whether or not the transactions contemplated hereby are consummated or this Agreement is terminated: (a) the costs incident to the authorization, issuance, sale, preparation and delivery of the Securities and any taxes payable in that connection; (b) the costs incident to the preparation, printing and distribution of the Registration Statement, any Preliminary Prospectus, any Issuer Free Writing Prospectus, the General Disclosure Package, the Prospectus, any amendments, supplements and exhibits thereto or any document incorporated by reference therein and the costs of printing, reproducing and distributing, the "Agreement Among Underwriters" between the Representative and the Underwriters, the Master Selected Dealers' Agreement, the Underwriters' Questionnaire, this Agreement and any closing documents by mail, telex or other means of communications; (c) the reasonable and documented fees and expenses (including related fees and expenses of counsel for the Underwriters) incurred in connection with securing any required review by FINRA of the terms of the sale of the Securities and any filings made with FINRA; (d) any applicable Exchange listing or other fees; (e) the reasonable fees and expenses (including related fees and expenses of counsel to the Underwriters) of qualifying the Securities under the securities laws of the several jurisdictions as provided in <u>Section 4(i)(g)</u> and of preparing, printing and distributing wrappers, Blue Sky Memoranda and Legal Investment Surveys; (f) all fees and expenses of the registrar and transfer agent of the Common Stock; (g) the costs and expenses relating to investor presentations on any "road show" undertaken in connection with the marketing of the offering of the Common Stock, including, without limitation, expenses associated with the preparation or dissemination of any electronic road show, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company; and (h) all other costs and expenses incident to the offering of the Securities or the performance of the obligations of the Company under this Agreement (including, without limitation, the fees and expenses of the Company's counsel and the Company's independent accountants); <u>provided</u> that, except to the extent otherwise provided in this <u>Section 5</u> and in <u>Sections 9</u> and <u>10</u>, the Underwriters shall pay their own costs and expenses, including the fees and expenses of their counsel not contemplated herein, any transfer taxes on the resale of any Securities by them and the expenses of advertising any offering of the Securities made by the Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Inclusive of the expenses set forth in <u>Section 5(a)</u> above, the Company agrees to reimburse the Representative for its reasonable out-of-pocket expenses in connection with the performance of its activities under this Agreement, including the reasonable and documented fees and expenses of the Underwriters' outside legal counsel, such reimbursement not to exceed $125,000.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*6.* *Conditions of Underwriters* ' *Obligations.* The respective obligations of the several Underwriters hereunder are subject to the accuracy, when made and as of the Applicable Time and on such Closing Date, of the representations and warranties of the Company contained herein, to the accuracy of the statements of the Company made in any certificates pursuant to the provisions hereof, to the performance by the Company of its obligations hereunder, and to each of the following additional terms and conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Registration Compliance; No Stop Orders</u>. The Registration Statement shall remain effective, and no stop order suspending the effectiveness of the Registration Statement or any part thereof, preventing or suspending the use of any Preliminary Prospectus, the Prospectus or any Permitted Free Writing Prospectus or any part thereof shall have been issued and no proceedings for that purpose or pursuant to Section 8A under the Securities Act shall have been initiated or, to the Company's Knowledge, threatened by the Commission, and all requests for additional information on the part of the Commission (to be included or incorporated by reference in the Registration Statement or the Prospectus or otherwise) shall have been complied with to the reasonable satisfaction of the Representative; the Rule 462(b) Registration Statement, if any, each Issuer Free Writing Prospectus and the Prospectus shall have been filed with, the Commission within the applicable time period prescribed for such filing by, and in compliance with, the Rules and Regulations and in accordance with <u>Section 4(i)(a)</u>, and the Rule 462(b) Registration Statement, if any, shall have become effective immediately upon its filing with the Commission; and FINRA shall have raised no unresolved objection to the fairness and reasonableness of the terms of this Agreement or the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>No Material Misstatements</u>. None of the Underwriters shall have discovered and disclosed to the Company on or prior to such Closing Date that the Registration Statement or any amendment or supplement thereto contains an untrue statement of a fact which, in the opinion of counsel for the Underwriters, is material or omits to state any fact which, in the opinion of such counsel, is material and is required to be stated therein or is necessary to make the statements therein not misleading, or that the General Disclosure Package, any Issuer Free Writing Prospectus or the Prospectus or any amendment or supplement thereto contains an untrue statement of fact which, in the opinion of such counsel, is material or omits to state any fact which, in the opinion of such counsel, is material and is necessary in order to make the statements, in the light of the circumstances in which they were made, not misleading.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Corporate Proceedings</u>. All corporate proceedings incident to the authorization, form and validity of each of this Agreement, the Securities, the Registration Statement, the General Disclosure Package, each Issuer Free Writing Prospectus and the Prospectus and the transactions contemplated hereby shall be reasonably satisfactory in all material respects to counsel for the Underwriters, and the Company shall have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Opinion and 10b-5 Statement of Counsel for the Company</u>*.* Dorsey & Whitney LLP shall have furnished to the Representative such counsel's written opinion and 10b-5 Statement, as counsel to the Company, addressed to the Underwriters and dated such Closing Date, in form previously agreed to with the Representative.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Opinion and 10b-5 Statement of Counsel for the Underwriters.</u> The Representative shall have received from Sullivan & Worcester LLP, counsel for the Underwriters, such opinion or opinions and 10b-5 Statement, dated such Closing Date, with respect to such matters as the Underwriters may reasonably require, and the Company shall have furnished to such counsel such documents as they may reasonably request for enabling them to pass upon such matters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Comfort Letter</u>. At the time of the execution of this Agreement, the Representative shall have received from Grant Thornton LLP a letter, addressed to the Underwriters, executed and dated such date, in form and substance satisfactory to the Representative (i) confirming that it is an independent registered accounting firm with respect to the Company and its consolidated subsidiaries within the meaning of the Securities Act and the Rules and Regulations and PCAOB and (ii) stating the conclusions and findings of the firm, of the type ordinarily included in accountants' "comfort letters" to underwriters, with respect to the financial statements and certain financial information contained or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Bring Down Comfort</u>. On the effective date of any post-effective amendment to the Registration Statement and on such Closing Date, the Representative shall have received a letter (the "***bring-down letter***") from Grant Thornton LLP addressed to the Underwriters and dated such Closing Date confirming, as of the date of the bring-down letter (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the General Disclosure Package and the Prospectus, as the case may be, as of a date not more than three (3) business days prior to the date of the bring-down letter), the conclusions and findings of the firm, of the type ordinarily included in accountants' "comfort letters" to underwriters, with respect to the financial information and other matters covered by its letter delivered to the Representative concurrently with the execution of this Agreement pursuant to paragraph (g) of this <u>Section 6</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Officer</u><u>'</u><u>s Certificate</u>. The Company shall have furnished to the Representative a certificate, dated such Closing Date, of its Chief Executive Officer or President and its Chief Financial Officer stating in their respective capacities as officers of the Company on behalf of the Company that (i) no stop order suspending the effectiveness of the Registration Statement (including, for avoidance of doubt, any Rule 462(b) Registration Statement), or any post-effective amendment thereto, shall be in effect and no proceedings for such purpose shall have been instituted or, to their knowledge, threatened by the Commission, (ii) for the period from and including the date of this Agreement through and including such Closing Date, there has not occurred any Material Adverse Effect, (iii) to their knowledge, as of such Closing Date, the representations and warranties of the Company in this Agreement are true and correct (except to the extent that such representations and warranties speak as of another date, in which case such representations and warranties shall be true and correct as of such other date), and the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to such Closing Date, and (iv) there has not been, subsequent to the date of the most recent audited financial statements included or incorporated by reference in the General Disclosure Package, any Material Adverse Effect, or any change or development that, singularly or in the aggregate, would reasonably be expected to have a Material Adverse Effect, except as set forth in the General Disclosure Package and the Prospectus.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>No Material Adverse Effect</u>. Since the date of the latest audited financial statements included in the General Disclosure Package or incorporated by reference in the General Disclosure Package as of the date hereof, (i) neither the Company nor any of its subsidiaries shall have sustained any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth in the General Disclosure Package, and (ii) there shall not have been any change in the capital stock or long-term debt of the Company or any of its subsidiaries, or any change, or any development involving a prospective change, in or affecting the business, properties, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries, otherwise than as set forth in the General Disclosure Package, the effect of which, in any such case described in clause (i) or (ii) of this paragraph (i), is, in the reasonable judgment of the Representative, so material and adverse as to make it impracticable or inadvisable to proceed with the sale or delivery of the Securities on the terms and in the manner contemplated in the General Disclosure Package.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>No Legal Impediment to Issuance</u>. No action shall have been taken and no law, statute, rule, regulation or order shall have been enacted, adopted or issued by any governmental or regulatory agency or body which would prevent the issuance or sale of the Common Stock; and no injunction, restraining order or order of any other nature by any federal or state court of competent jurisdiction shall have been issued which would prevent the issuance or sale of the Securities or materially and adversely affect or potentially materially and adversely affect the business or operations of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) <u>Market Conditions</u>. Subsequent to the execution and delivery of this Agreement there shall not have occurred any of the following: (i) trading in any of the Company's securities shall have been suspended or materially limited by the Commission or the Exchange, or trading in securities generally on the New York Stock Exchange, Nasdaq Global Select Market, Nasdaq Global Market, Nasdaq Capital Market or the NYSE American or in the over-the-counter market, or trading in any securities of the Company on any exchange or in the over-the-counter market, shall have been suspended or materially limited, or minimum or maximum prices or maximum range for prices shall have been established on any such exchange or such market by the Commission, by such exchange or market or by any other regulatory body or governmental authority having jurisdiction, (ii) a banking moratorium shall have been declared by Federal or state authorities or a material disruption has occurred in commercial banking or securities settlement or clearance services in the United States, (iii) the United States shall have become engaged in hostilities, or the subject of an act of terrorism, or there shall have been an outbreak of or escalation in hostilities involving the United States, or there shall have been a declaration of a national emergency or war by the United States or (iv) there shall have occurred such a material adverse change in general economic, political or financial conditions (or the effect of international conditions on the financial markets in the United States shall be such) as to make it, in the reasonable judgment of the Representative, impracticable or inadvisable to proceed with the sale or delivery of the Securities on the terms and in the manner contemplated in the General Disclosure Package and the Prospectus.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) <u>Exchange Listing</u>. The Company shall have filed a Notification: Listing of Additional Shares with the Exchange.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) <u>Good Standing</u>. The Representative shall have received on and as of such Closing Date satisfactory evidence of the good standing of the Company and its subsidiaries in their respective jurisdictions of organization and their good standing as foreign entities in such other jurisdictions as the Representative may reasonably request, in each case in writing or any standard form of telecommunication from the appropriate governmental authorities of such jurisdictions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) <u>Lock-Up Agreements</u>. The Representative shall have received the written agreements, substantially in the form of <u>Exhibit</u><u> </u><u>I</u> hereto, of the officers and directors of the Company listed in <u>Schedule D</u> to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) <u>Secretary</u><u>'</u><u>s Certificate</u>. The Company shall have furnished to the Representative a Secretary's Certificate of the Company, in form and substance reasonably satisfactory to counsel for the Underwriters and customary for the type of offering contemplated by this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) <u>Chief Financial Officer Certificate</u>. The Company shall have furnished to the Representative a certificate, dated such Closing Date, of its Chief Financial Officer, in form and substance reasonably satisfactory to the Representative.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) <u>Additional Documents</u>. On or prior to such Closing Date, the Company shall have furnished to the Representative such further certificates and documents as the Representative may reasonably request.

All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*7.* *Indemnification and Contribution.* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Indemnification of Underwriters by the Company</u>. The Company shall indemnify and hold harmless each Underwriter, its affiliates, directors, officers, managers, members, employees, representatives and agents and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (collectively the "***Underwriter Indemnified Parties***," and each an "***Underwriter Indemnified Party***") against any loss, claim, damage, expense or liability whatsoever (or any action, investigation or proceeding in respect thereof), joint or several, to which such Underwriter Indemnified Party may become subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, expense, liability, action, investigation or proceeding arises out of or is based upon (A) any untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any Issuer Free Writing Prospectus, any "issuer information" filed or required to be filed pursuant to Rule 433(d) of the Rules and Regulations, the Registration Statement, the Prospectus, or in any amendment or supplement thereto or document incorporated by reference therein, or in any materials or information provided to investors by, or with the approval of, the Company in connection with the marketing of the offering of the Common Stock, including any roadshow or investor presentations made to investors by the Company (whether in person or electronically) ("***Marketing Materials***") or (B) the omission or alleged omission to state in any Preliminary Prospectus, any Issuer Free Writing Prospectus, any "issuer information" filed or required to be filed pursuant to Rule 433(d) of the Rules and Regulations, the Registration Statement or the Prospectus, or in any amendment or supplement thereto or document incorporated by reference therein, or in any Marketing Materials, a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading, and shall reimburse each Underwriter Indemnified Party promptly upon demand for any legal fees or other expenses reasonably incurred by that Underwriter Indemnified Party in connection with investigating, or preparing to defend, or defending against, or appearing as a third party witness in respect of, or otherwise incurred in connection with, any such loss, claim, damage, expense, liability, action, investigation or proceeding, as such fees and expenses are incurred; <u>provided</u>, <u>however</u>, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage, expense or liability arises out of or is based upon an untrue statement or alleged untrue statement in, or omission or alleged omission from any Preliminary Prospectus, the Registration Statement or the Prospectus, or any such amendment or supplement thereto, any Issuer Free Writing Prospectus or any Marketing Materials made in reliance upon and in conformity with written information furnished to the Company through the Representative by or on behalf of any Underwriter specifically for use therein, which information the parties hereto agree is limited to the Underwriters' Information.

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The indemnity agreement in this <u>Section 7(a)</u> is not exclusive and is in addition to each other liability which the Company might have under this Agreement or otherwise, and shall not limit any rights or remedies which may otherwise be available under this Agreement, at law or in equity to any Underwriter Indemnified Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Indemnification of Company by the Underwriters</u>. Each Underwriter, severally and not jointly, shall indemnify and hold harmless the Company and its directors, its officers who signed the Registration Statement and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (collectively the "***Company Indemnified Parties***" and each a "***Company Indemnified Party***") against any loss, claim, damage, expense or liability whatsoever (or any action, investigation or proceeding in respect thereof), joint or several, to which such Company Indemnified Party may become subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, expense, liability, action, investigation or proceeding arises out of or is based upon (i) any untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any Issuer Free Writing Prospectus, any "issuer information" filed or required to be filed pursuant to Rule 433(d) of the Rules and Regulations, the Registration Statement or the Prospectus, or in any amendment or supplement thereto or document incorporated by reference therein, or (ii) the omission or alleged omission to state in any Preliminary Prospectus, any Issuer Free Writing Prospectus, any "issuer information" filed or required to be filed pursuant to Rule 433(d) of the Rules and Regulations, the Registration Statement or the Prospectus, or in any amendment or supplement thereto or document incorporated by reference therein, a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading, but in each case only to the extent that the untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to the Company through the Representative by or on behalf of that Underwriter specifically for use therein, which information the parties hereto agree is limited to the Underwriters' Information, and shall reimburse the Company Indemnified Parties for any legal or other expenses reasonably incurred by such party in connection with investigating or preparing to defend or defending against or appearing as third party witness in connection with any such loss, claim, damage, liability, action, investigation or proceeding, as such fees and expenses are incurred. This indemnity agreement is not exclusive and will be in addition to any liability which the Underwriters might otherwise have and shall not limit any rights or remedies which may otherwise be available under this Agreement, at law or in equity to the Company Indemnified Parties.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Promptly after receipt by an indemnified party under this <u>Section 7</u> of notice of the commencement of any action, the indemnified party shall, if a claim in respect thereof is to be made against an indemnifying party under this <u>Section 7</u>, notify such indemnifying party in writing of the commencement of that action; <u>provided</u>, <u>however</u>*,* that the failure to notify the indemnifying party shall not relieve it from any liability which it may have under this <u>Section 7</u> except to the extent it has been materially prejudiced by such failure; and, <u>provided</u>, <u>further</u>*,* that the failure to notify an indemnifying party shall not relieve it from any liability which it may have to an indemnified party otherwise than under this <u>Section 7</u>. If any such action shall be brought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assume the defense of such action with counsel reasonably satisfactory to the indemnified party (which counsel shall not, except with the written consent of the indemnified party, be counsel to the indemnifying party). After notice from the indemnifying party to the indemnified party of its election to assume the defense of such action, except as provided herein, the indemnifying party shall not be liable to the indemnified party under <u>Section 7</u> for any legal or other expenses subsequently incurred by the indemnified party in connection with the defense of such action other than reasonable costs of investigation; <u>provided</u>, <u>however</u>*,* that any indemnified party shall have the right to employ separate counsel in any such action and to participate in the defense of such action but the fees and expenses of such counsel (other than reasonable costs of investigation) shall be at the expense of such indemnified party unless (i) the employment thereof has been specifically authorized in writing by the Company in the case of a claim for indemnification under <u>Section 7(a)</u> or the Representative in the case of a claim for indemnification under <u>Section 7(b)</u>, (ii) such indemnified party shall have been advised by its counsel that there may be one or more legal defenses available to it which are different from or additional to those available to the indemnifying party, (iii) the indemnifying party has failed to assume the defense of such action and employ counsel reasonably satisfactory to the indemnified party within a reasonable period of time after notice of the commencement of the action or the indemnifying party does not diligently defend the action after assumption of the defense, in which case, if such indemnified party notifies the indemnifying party in writing that it elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the right to assume the defense of (or, in the case of a failure to diligently defend the action after assumption of the defense, to continue to defend) such action on behalf of such indemnified party and the indemnifying party shall be responsible for legal or other expenses subsequently incurred by such indemnified party in connection with the defense of such action; <u>provided</u>, <u>however</u>, that the indemnifying party shall not, in connection with any one such action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of more than one separate firm of attorneys at any time for all such indemnified parties (in addition to any local counsel), which firm shall be designated in writing by the Representative if the indemnified parties under this <u>Section 7</u> consist of any Underwriter Indemnified Party or by the Company if the indemnified parties under this <u>Section</u><u> </u><u>7</u> consist of any Company Indemnified Parties. Subject to this <u>Section 7(c)</u>, the amount payable by an indemnifying party under <u>Section 7</u> shall include, but not be limited to, (x) reasonable legal fees and expenses of counsel to the indemnified party and any other expenses in investigating, or preparing to defend or defending against, or appearing as a third party witness in respect of, or otherwise incurred in connection with, any action, investigation, proceeding or claim, and (y) all amounts paid in settlement of any of the foregoing. No indemnifying party shall, without the prior written consent of the indemnified parties (which consent shall not be unreasonably withheld or delayed), settle or compromise or consent to the entry of judgment with respect to any pending or threatened action or any claim whatsoever, in respect of which indemnification or contribution could be sought under this <u>Section 7</u> (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party in form and substance reasonably satisfactory to such indemnified party from all liability arising out of such action or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party. Subject to the provisions of the following sentence, no indemnifying party shall be liable for settlement of any pending or threatened action or any claim whatsoever that is effected without its written consent (which consent shall not be unreasonably withheld or delayed), but if settled with its written consent, if its consent has been unreasonably withheld or delayed or if there be a judgment for the plaintiff in any such matter, the indemnifying party agrees to indemnify and hold harmless any indemnified party from and against any loss or liability by reason of such settlement or judgment. In addition, if at any time an indemnified party shall have requested that an indemnifying party reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by <u>Section 7(a)</u> or <u>7(b)</u> effected without its written consent if (i) such settlement is entered into more than forty-five (45) days after receipt by such indemnifying party of the request for reimbursement, (ii) such indemnifying party shall have received notice of the terms of such settlement at least thirty (30) days prior to such settlement being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If the indemnification provided for in this <u>Section 7</u> is unavailable or insufficient to hold harmless an indemnified party under <u>Section 7(a)</u> or <u>7(b)</u>, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount paid, payable or otherwise incurred by such indemnified party as a result of such loss, claim, damage, expense or liability (or any action, investigation or proceeding in respect thereof), as incurred, (i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other from the offering of the Securities, or (ii) if the allocation provided by clause (i) of this <u>Section 7(d)</u> is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) of this <u>Section 7(d)</u> but also the relative fault of the Company, on the one hand and the Underwriters on the other with respect to the statements, omissions, acts or failures to act which resulted in such loss, claim, damage, expense or liability (or any action, investigation or proceeding in respect thereof) as well as any other relevant equitable considerations. The relative benefits received by the Company, on the one hand and the Underwriters on the other with respect to such offering shall be deemed to be in the same proportion as the total net proceeds from the offering of the Securities purchased under this Agreement (before deducting expenses) received by the Company, bear to the total underwriting discounts and commissions received by the Underwriters with respect to the Securities purchased under this Agreement, in each case as set forth in the table on the cover page of the Prospectus. The relative fault of the Company on the one hand and the Underwriters on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company, on the one hand or the Underwriters on the other, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such untrue statement, omission, act or failure to act; <u>provided</u> that the parties hereto agree that the written information furnished to the Company through the Representative by or on behalf of the Underwriters for use in the Preliminary Prospectus, the Registration Statement or the Prospectus, or in any amendment or supplement thereto or document incorporated by reference therein, consists solely of the Underwriters' Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to <u>Section 7(d)</u> above were to be determined by pro rata allocation or by any other method of allocation which does not take into account the equitable considerations referred to <u>Section 7(d)</u> above. The amount paid or payable by an indemnified party as a result of the loss, claim, damage, expense, liability, action, investigation or proceeding referred to in <u>Section 7(d)</u> above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating, preparing to defend or defending against or appearing as a third party witness in respect of, or otherwise incurred in connection with, any such loss, claim, damage, expense, liability, action, investigation or proceeding. Notwithstanding the provisions of this <u>Section 7</u>, no Underwriter shall be required to contribute any amount in excess of the amount by which the total underwriting discounts and commissions received by such Underwriter with respect to the offering of the Securities exceeds the amount of any damages which the Underwriter has otherwise paid or become liable to pay by reason of any untrue or alleged untrue statement, omission or alleged omission, act or alleged act or failure to act or alleged failure to act. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters' obligations to contribute as provided in this <u>Section 7</u> are several in proportion to their respective underwriting obligations and not joint.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*8.* *Termination*. This Agreement may be terminated by the Representative by notice to the Company (a) at any time prior to the Closing Date or the Option Closing Date (if different from the Closing Date and then only as to the Optional Securities) if, prior to the applicable date, any of the events described in <u>Section 6(i)</u>, <u>6(j)</u> or <u>6(k)</u> shall have occurred, or (b) as provided in <u>Section 10</u> of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*9.* *Reimbursement of Underwriters* ' *Expenses*. Notwithstanding anything to the contrary in this Agreement, if (a) this Agreement shall have been terminated pursuant to <u>Section 8</u> or <u>10</u>, (b) the Company shall fail to tender the Securities for delivery to the Underwriters for any reason not permitted under this Agreement, (c) the Underwriters shall decline to purchase the Securities for any reason permitted under this Agreement or (d) the sale of the Securities is not consummated because any condition to the obligations of the Underwriters set forth herein is not satisfied or because of the refusal, inability or failure on the part of the Company to perform any agreement herein or to satisfy any condition or to comply with the provisions hereof, then in addition to the payment of amounts in accordance with <u>Section 5</u>, the Company shall reimburse the Underwriters for the reasonable and documented fees and expenses of Underwriters' counsel and for such other out-of-pocket expenses as shall have been actually and reasonably incurred by them in connection with this Agreement and the proposed purchase of the Common Stock, and upon demand the Company shall pay the full amount thereof to the Representative not to exceed $75,000 in the aggregate; <u>provided</u> that **  if this Agreement is terminated pursuant to <u>Section 10</u> by reason of the default of one or more Underwriters, the Company shall not be obligated to reimburse any defaulting Underwriter on account of expenses to the extent incurred by such defaulting Underwriter, <u>provided</u> <u>further</u> that the foregoing shall not limit any reimbursement obligation of the Company to any non-defaulting Underwriter under this <u>Section 9</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*10.* *Substitution of Underwriters*. If any Underwriter or Underwriters shall default in its or their obligations to purchase Securities hereunder on any Closing Date and the aggregate number of shares which such defaulting Underwriter or Underwriters agreed but failed to purchase does not exceed ten percent (10%) of the total number of shares to be purchased by all Underwriters on such Closing Date, the other Underwriters shall be obligated severally, in proportion to their respective commitments hereunder, to purchase the shares which such defaulting Underwriter or Underwriters agreed but failed to purchase on such Closing Date. If any Underwriter or Underwriters shall so default and the aggregate number of shares with respect to which such default or defaults occur is more than ten percent (10%) of the total number of shares to be purchased by all Underwriters on such Closing Date and arrangements satisfactory to the Representative and the Company for the purchase of such shares by other persons are not made within forty-eight (48) hours after such default, this Agreement shall terminate.

If the remaining Underwriters or substituted Underwriters are required hereby or agree to take up all or part of the Securities of a defaulting Underwriter or Underwriters on such Closing Date as provided in this <u>Section</u><u> </u><u>10</u>, (i) the Company shall have the right to postpone such Closing Date for a period of not more than five (5) full business days in order that the Company may effect whatever changes may thereby be made necessary in the Registration Statement or the Prospectus, or in any other documents or arrangements, and the Company agrees promptly to file any amendments to the Registration Statement or supplements to the Prospectus which may thereby be made necessary, and (ii) the respective numbers of Securities to be purchased by the remaining Underwriters or substituted Underwriters shall be taken as the basis of their underwriting obligation for all purposes of this Agreement. Nothing herein contained shall relieve any defaulting Underwriter of its liability to the Company or the other Underwriters for damages occasioned by its default hereunder. Any termination of this Agreement pursuant to this <u>Section 10</u> shall be without liability on the part of any non-defaulting Underwriter or the Company, except that the representations, warranties, covenants, indemnities, agreements and other statements set forth in <u>Section 2</u>, the obligations with respect to expenses to be paid or reimbursed pursuant to <u>Sections 5</u> and <u>9</u> and the provisions of <u>Section 7</u> and <u>Sections 11</u> through <u>22</u>, inclusive, shall not terminate and shall remain in full force and effect.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*11.* *Absence of Fiduciary Relationship.* The Company acknowledges and agrees that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) each Underwriter's responsibility to the Company is solely contractual in nature, the Representative and the Underwriters have been retained solely to act as underwriters in connection with the sale of the Securities and no fiduciary, advisory or agency relationship between the Company and the Representative have been created in respect of any of the transactions contemplated by this Agreement, irrespective of whether the Representative has advised or is advising the Company on other matters;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the price of the Securities set forth in this Agreement was established by the Company following discussions and arms-length negotiations with the Representative, and the Company is capable of evaluating and understanding, and understands and accepts, the terms, risks and conditions of the transactions contemplated by this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) it has been advised that the Representative and its affiliates are engaged in a broad range of transactions which may involve interests that differ from those of the Company and that the Representative has no obligation to disclose such interests and transactions to the Company by virtue of any fiduciary, advisory or agency relationship; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) it waives, to the fullest extent permitted by law, any claims it may have against the Representative for breach of fiduciary duty or alleged breach of fiduciary duty and agrees that the Representative shall have no liability (whether direct or indirect) to the Company in respect of such a fiduciary duty claim or to any person asserting a fiduciary duty claim on behalf of or in right of the Company, including stockholders, employees or creditors of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*12.* *Successors; Persons Entitled to Benefit of Agreement*. This Agreement shall inure to the benefit of and be binding upon the several Underwriters, the Company, and their respective successors and assigns. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, other than the persons mentioned in the preceding sentence, any legal or equitable right, remedy or claim under or in respect of this Agreement, or any provisions herein contained, this Agreement and all conditions and provisions hereof being intended to be and being for the sole and exclusive benefit of such persons and for the benefit of no other person; except that the representations, warranties, covenants, agreements and indemnities of the Company, contained in this Agreement shall also be for the benefit of the Underwriter Indemnified Parties, and the indemnities of the several Underwriters shall be for the benefit of the Company Indemnified Parties. It is understood that each Underwriter's responsibility to the Company is solely contractual in nature and the Underwriters do not owe the Company, or any other party, any fiduciary duty as a result of this Agreement. No purchaser of any of the Securities from any Underwriter shall be deemed to be a successor or assign by reason merely of such purchase.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*13.* *Survival of Indemnities, Representations, Warranties, etc .* The respective indemnities, covenants, agreements, representations, warranties and other statements of the Company, and the several Underwriters, as set forth in this Agreement or made by them respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation made by or on behalf of any Underwriter, the Company or any person controlling any of them and shall survive delivery of and payment for the Firm Stock or Optional Stock, as applicable. Notwithstanding any termination of this Agreement, including without limitation any termination pursuant to <u>Section 8</u> or <u>Section 10</u>, the indemnities, covenants, agreements, representations, warranties and other statements forth in <u>Sections 2</u>, <u>5</u>, <u>7</u> and <u>9</u> and <u>Sections 11</u> through <u>22</u>, inclusive, of this Agreement shall not terminate and shall remain in full force and effect at all times.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*14.* *Recognition of the U.S. Special Resolution Regimes.* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*15.* *Notices*. All statements, requests, notices and agreements hereunder shall be in writing, and:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) if to the Underwriters, shall be delivered or sent by mail, telex, facsimile transmission or email to Lake Street Capital Markets, LLC, Attention: Michael Townley, CEO and Head of Investment Banking, mike.townley@lakestreetcm.com; with a copy to Sullivan & Worcester LLP, 1251 Avenue of the Americas, New York, New York 10020, Attention: David Danovitch, ddanovitch@sullivanlaw.com and Aaron Schleicher, aschleicher@sullivanlaw.com; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if to the Company, shall be delivered or sent by mail, telex, facsimile transmission or email to Aytu BioPharma, Inc., Attention: Joshua Disbrow, Chief Executive Officer, 7900 East Union Avenue, Suite 920 Denver, CO 80237, with a copy to Dorsey & Whitney LLP, 1400 Wewatta Street, Suite 400, Denver, CO 80202, Attention: Anthony Epps, epps.anthony@dorsey.com;

<u>provided</u>, <u>however</u>*,* that any notice to an Underwriter pursuant to <u>Section 7</u> shall be delivered or sent by mail, or facsimile transmission to such Underwriter at its address set forth in its acceptance telex to the Representative, which address will be supplied to any other party hereto by the Representative upon request. Any such statements, requests, notices or agreements shall take effect at the time of receipt thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*16.* *Definition of Certain Terms*. For purposes of this Agreement, (a) "  ***affiliate***" has the meaning set forth in Rule 405 under the Securities Act, (b) "  ***business day***" means any day on which the Nasdaq Capital Market is open for trading, (c) [reserved], (d) "  ***BHC Act Affiliate***" has the meaning assigned to the term "affiliate" in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k), (e) "  ***Covered Entity***" means any of the following: (i) a "covered entity" as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a "covered bank" as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a "covered FSI" as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b), (f) "  ***Default Right***" has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable, (g) "  ***U.S. Special Resolution Regime***" means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder, and (h) "  ***Company*** '  ***s Knowledge***" means the actual knowledge of any executive officer (as defined in Rule 405 under the 1933 Act) of the Company.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*17.* *Governing Law, Jurisdiction, Waiver of Jury Trial.* This Agreement shall be governed by and construed in accordance with the laws of the State of New York, including without limitation Section 5-1401 of the New York General Obligations Law. The Company irrevocably (a) submits to the exclusive jurisdiction of the Federal and state courts in the County of New York in The City of New York for the purpose of any suit, action or other proceeding arising out of this Agreement or the transactions contemplated by this Agreement, the Registration Statement and any Preliminary Prospectus or the Prospectus, (b) agrees that all claims in respect of any such suit, action or proceeding may be heard and determined by any such court, (c) waives to the fullest extent permitted by applicable law, any immunity from the jurisdiction of any such court or from any legal process, (d) agrees not to commence any such suit, action or proceeding other than in such courts, and (e) waives, to the fullest extent permitted by applicable law, any claim that any such suit, action or proceeding is brought in an inconvenient forum. **Each of the parties to this Agreement hereby waives any right to trial by jury in any suit or proceeding arising out of or relating to this Agreement.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*18.* *Underwriters* ' *Information* *.* The parties hereto acknowledge and agree that, for all purposes of this Agreement, the "  ***Underwriters*** '  ***Information***" consists solely of the following information in the Prospectus: the statements concerning the Underwriters contained in the [•] paragraphs under the heading "Underwriting."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*19.* *Authority of the Representative*. In connection with this Agreement, the Representative will act for and on behalf of the several Underwriters, and any action taken under this Agreement by the Representative, will be binding on all the Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*20.* *Partial Unenforceability*. The invalidity or unenforceability of any section, paragraph, clause or provision of this Agreement shall not affect the validity or enforceability of any other section, paragraph, clause or provision hereof. If any section, paragraph, clause or provision of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor changes (and only such minor changes) as are necessary to make it valid and enforceable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*21.* *General*. This Agreement constitutes the entire agreement of the parties to this Agreement and supersedes all prior written or oral and all contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof. In this Agreement, the masculine, feminine and neuter genders and the singular and the plural include one another. The section headings in this Agreement are for the convenience of the parties only and will not affect the construction or interpretation of this Agreement. This Agreement may be amended or modified, and the observance of any term of this Agreement may be waived, only by a writing signed by the Company and the Representative.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*22.* *Counterparts*. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement may be delivered via facsimile, electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com or www.echosign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

[*Signature page follows*]

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If the foregoing is in accordance with your understanding, please indicate your acceptance of this Agreement by signing in the space provided for that purpose below.

Very truly yours, Aytu BioPharma, inc. By:____________________________<br> Name: Joshua R. Disbrow<br> Title: Chief Executive Officer

Accepted as of the date first above written:<br>Lake Street Capital Markets, LLC<br>Acting on its own behalf<br> and as Representative of the several<br> Underwriters listed on <u>Schedule A</u> to this Agreement.<br> By:______________________________<br> Name: Michael Townley<br> Title: CEO and Head of Investment Banking<br>

*Signature Page to Underwriting Agreement*

## Exhibit 4.13

**Exhibit 4.13**

**PREFUNDED COMMON STOCK PURCHASE WARRANT**

**AYTU BIOPHARMA, INC.**

Warrant Shares: [•] Initial Exercise Date: [•], 2025

THIS PREFUNDED COMMON STOCK PURCHASE WARRANT (the "<u>Warrant</u>") certifies that, for value received, _____________ or its assigns (the "<u>Holder</u>") is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date hereof (the "<u>Initial Exercise Date</u>") and until this Warrant is exercised in full (the "<u>Termination Date</u>") but not thereafter, to subscribe for and purchase from Aytu BioPharma, Inc., a Delaware corporation (the "<u>Company</u>"), up to ______ shares of common stock, par value $0.0001 per share (the "<u>Common Stock</u>") (as subject to adjustment hereunder, the "<u>Warrant Shares</u>"). The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).

<u>Section 1</u>. <u>Definitions</u>. In addition to the terms defined elsewhere in this Warrant, the following terms have the meanings indicated in this Section 1:

"<u>Affiliate</u>" means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.

"<u>Business Day</u>" means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; <u>provided</u>, <u>however</u>, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to "stay at home", "shelter-in-place", "non-essential employee" or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.

"<u>Commission</u>" means the United States Securities and Exchange Commission.

"<u>Common Stock Equivalents</u>" means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.

"<u>Exchange Act</u>" means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

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"<u>Person</u>" means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

"<u>Securities Act</u>" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

"<u>Subsidiary</u>" means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.

"<u>Trading Day</u>" means a day on which the Common Stock is traded on a Trading Market.

"<u>Trading Market</u>" means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, OTCQB or OTCQX (or any successors to any of the foregoing).

"<u>Underwriting Agreement</u>" means the underwriting agreement, dated April [•], 2025, among the Company and the underwriters signatory thereto, as amended modified or supplemented from time to time in accordance with its terms.

<u>Section 2</u>. <u>Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <u>Exercise of Warrant</u>. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed PDF copy submitted by e-mail (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the "<u>Notice of Exercise</u>"). Within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the Warrant Shares specified in the applicable Notice of Exercise by wire transfer or cashier's check drawn on a United States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date on which the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. **The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.**

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <u>Exercise Price</u>. The aggregate exercise price of this Warrant, except for a nominal exercise price of $0.0001 per Warrant Share, was pre-funded to the Company on or prior to the Initial Exercise Date and, consequently, no additional consideration (other than the nominal exercise price of $0.0001 per Warrant Share) shall be required to be paid by the Holder to any Person to effect any exercise of this Warrant. The Holder shall not be entitled to the return or refund of all, or any portion, of such pre-paid aggregate exercise price under any circumstance or for any reason whatsoever. The remaining unpaid exercise price per share of Common Stock under this Warrant shall be $0.0001, subject to adjustment hereunder (the "<u>Exercise Price</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <u>Cashless Exercise</u>. This Warrant may also be exercised, in whole or in part, at such time by means of a "cashless exercise" in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) = as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of "regular trading hours" (as defined in Rule 600(b) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of the Holder, either (x) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise or (y) the Bid Price of the Common Stock on the principal Trading Market as reported by Bloomberg L.P. ("Bloomberg") as of the time of the Holder's execution of the applicable Notice of Exercise if such Notice of Exercise is executed during "regular trading hours" on a Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of "regular trading hours" on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section 2(a) hereof after the close of "regular trading hours" on such Trading Day;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) = the Exercise Price, as adjusted hereunder; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(X) = the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

If Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take on the characteristics of the Warrants being exercised. The Company agrees not to take any position contrary to this Section 2(c).

"<u>Bid Price</u>" means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices), the average of the bid prices of any market makers over the prior three days as of such time of determination, for such security as reported in The Pink Open Market or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in- good faith by the Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.

"<u>VWAP</u>" means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (Eastern time) to 4:02 p.m. (New York City time)), (b) if the OTCQB Venture Market ("<u>OTCQB</u>") or the OTCQX Best Market ("<u>OTCQX</u>") is not a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on the Pink Open Market ("<u>Pink Market</u>") operated by the OTC Markets, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the average of the bid prices of any market makers over the prior three days as of such time of determination, for such security as reported in the Pink Market, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Holders of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <u>Mechanics of Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. <u>Delivery of Warrant Shares Upon Exercise</u>. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the transfer agent to the Holder by crediting the account of the Holder's or its designee's balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system ("<u>DWAC</u>") if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by Holder or (B) this Warrant is being exercised via cashless exercise, and otherwise by physical delivery of a certificate, registered in the Company's share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earlier of (i) two (2) Trading Days after the delivery to the Company of the Notice of Exercise; (ii) one (1) Trading Day after delivery of the aggregate Exercise Price to the Company; and (iii)the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date, the "<u>Warrant Share Delivery Date</u>"); provided, however that payment of the aggregate Exercise Price, other than in the instance of a cashless exercise) is received by the Company by such date. Upon delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, "<u>Standard Settlement Period</u>" means the standard settlement period, expressed in a number of Trading Days, on the Company's primary Trading Market with respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the third (3<sup>rd</sup>) Trading Day after the Warrant Share Delivery Date) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, "<u>Standard Settlement Period</u>" means the standard settlement period, expressed in a number of Trading Days, on the Company's primary Trading Market with respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. <u>Delivery of New Warrants Upon Exercise</u>. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. <u>Rescission Rights</u>. If the Company fails to cause the transfer agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date (subject to receipt of the aggregate exercise price for the applicable exercise (other than in the case of a cashless exercise)), then the Holder will have the right to rescind such exercise by delivering written notice to the Company at any time prior to the Company delivering such Warrant Shares; provided, however, that the Holder shall be required to return any Warrant Shares subject to any such rescinded exercise notice concurrently with the return to the Holder of the aggregate Exercise Price paid to the Company for such Warrant Shares and the restoration of Holder's right to acquire such Warrant Shares pursuant to this Warrant (including issuance of a replacement warrant certificate evidencing such restored right).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. <u>Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise</u>. In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder's brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a "<u>Buy-In</u>"), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder's total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver, but did not timely deliver, to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder's right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company's failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. <u>No Fractional Shares or Scrip</u>. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi. <u>Charges, Taxes and Expenses</u>. Issuance and delivery of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; <u>provided</u>, <u>however</u>, that, in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all transfer agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vii. <u>Closing of Books</u>. The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <u>Holder</u> <u>'</u> <u>s Exercise Limitations</u>. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder's Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder's Affiliates, and any other Persons whose beneficial ownership of the shares of Common Stock would or could be aggregated with the Holder's for the purposes of Section 13(d) of the Exchange Act (such Persons, " <u>Attribution Parties</u> ")), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder's determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination (including any determination as to group status pursuant to the next sentence) and shall have no liability for exercises of this Warrant that are not in compliance with the Beneficial Ownership Limitation (other than to the extent that the information on the number of outstanding shares of Common Stock is provided by the Company, either directly or through one or more public filings relied upon by the Holder. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected in (A) the Company's most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the transfer agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of a Holder, the Company shall within one Trading Day confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of Common Stock was reported. The " <u>Beneficial Ownership Limitation</u> " shall be [4.99%/9.99%] of the number of shares of Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership Limitation in no event exceeds 19.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61<sup>st</sup> day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.

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<u>Section 3</u>. <u>Certain Adjustments</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <u>Stock Dividends and Splits</u>. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged, provided that the Exercise Price per share shall in any case be no lower than the par value of the Common Stock. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <u>[Reserved]</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <u>Subsequent Rights Offerings</u>. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of shares of Common Stock (the "<u>Purchase Rights</u>"), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (<u>provided</u>, <u>however</u>, that, to the extent that the Holder's right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <u>Pro Rata Distributions</u>. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "<u>Distribution</u>"), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (<u>provided</u>, <u>however</u>, that, to the extent that the Holder's right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation). To the extent that this Warrant has not been partially or completely exercised at the time of such Distribution, such portion of the Distribution shall be held in abeyance for the benefit of the Holder until the Holder has exercised this Warrant.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <u>Fundamental Transaction</u>. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company (and all of its Subsidiaries, taken as a whole), directly or indirectly effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, except to the extent subject to an adjustment pursuant to Section 3(a), (b), (c), or (d), (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of shares of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding shares of Common Stock or 50% or more of the voting power of the Common Stock of the Company, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires 50% or more of the outstanding shares of Common Stock or 50% or more of the voting power of the Common Stock of the Company (each a "<u>Fundamental Transaction</u>"), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the "<u>Alternate Consideration</u>") receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of shares of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the "<u>Successor Entity</u>") to assume in writing all of the obligations of the Company under this Warrant and the other Transaction Documents in accordance with the provisions of this Section 3(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall be added to the term "Company" under this Warrant (so that from and after the occurrence or consummation of such Fundamental Transaction, each and every provision of this Warrant and the other Transaction Documents referring to the "Company" shall refer instead to each of the Company and the Successor Entity or Successor Entities, jointly and severally), and the Successor Entity or Successor Entities, jointly and severally with the Company, may exercise every right and power of the Company prior thereto and the Successor Entity or Successor Entities shall assume all of the obligations of the Company prior thereto under this Warrant and the other Transaction Documents with the same effect as if the Company and such Successor Entity or Successor Entities, jointly and severally, had been named as the Company herein.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <u>Calculations</u>. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g) <u>Notice to Holder</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. <u>Adjustment to Exercise Price</u>. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly deliver to the Holder by email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. <u>Notice to Allow Exercise by Holder</u>. If, while the Warrant is outstanding, (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company (or any of its Subsidiaries) is a party, any sale or transfer of all or substantially all of its assets, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property, or any Fundamental Transaction, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by email to the Holder at its last email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

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<u>Section 4</u>. <u>Transfer of Warrant</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <u>Transferability</u>. This Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three (3) Trading Days of the date on which the Holder delivers an assignment form to the Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <u>New Warrants</u>. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Issue Date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <u>Warrant Register</u>. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the "<u>Warrant Register</u>"), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

<u>Section 5</u>. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <u>No Rights as Stockholder Until Exercise; No Settlement in Cash</u>. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section 3. Without limiting any rights of a Holder to receive Warrant Shares on a "cashless exercise" pursuant to Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event shall the Company be required to net cash settle an exercise of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <u>Loss, Theft, Destruction or Mutilation of Warrant</u>. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <u>Saturdays, Sundays, Holidays, etc</u>. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <u>Authorized Shares</u>.

Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <u>Governing Law</u>. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Warrant (whether brought against a party hereto or their respective affiliates, directors, officers, stockholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, County of New York for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Warrant and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an action, suit or proceeding to enforce any provisions of this Warrant, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for their reasonable attorneys' fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding. Notwithstanding the foregoing, nothing in this paragraph shall limit or restrict the federal district court in which a Holder may bring a claim under the federal securities laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <u>Restrictions</u>. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g) <u>Nonwaiver and Expenses</u>. No course of dealing or any delay or failure to exercise any right hereunder on the part of the Holder shall operate as a waiver of such right or otherwise prejudice the Holder's rights, powers or remedies, notwithstanding the fact that the right to exercise this Warrant terminates on the Termination Date. Without limiting any other provision of this Warrant or the Underwriting Agreement, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys' fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h) <u>Notices</u>. Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation, any Notice of Exercise, shall be in writing and delivered personally, by e-mail, or sent by a nationally recognized overnight courier service, addressed to the Company, at 7900 East Union Avenue, Suite 920, Denver, CO 80237, Attention: Ryan Selhorn, Chief Financial Officer, email address: RSelhorn@aytubio.com, or such other email address or address as the Company may specify for such purposes by notice to the Holders. Any and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by e-mail, or sent by a nationally recognized overnight courier service addressed to each Holder at the e-mail address or address of such Holder appearing on the books of the Company. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the time of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth in this Section 5.8 prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the time of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth in this Section 5(h) on a Calendar Day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given. To the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) <u>Limitation of Liability</u>. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;j) <u>Remedies</u>. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;k) <u>Successors and Assigns</u>. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;l) <u>Amendment</u>. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder (or the beneficial owner of this Warrant).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;m) <u>Severability</u>. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;n) <u>Headings</u>. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

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*(Signature Page Follows)*

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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.

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| |
|:---|
| **AYTU BIOPHARMA, INC.** |
| By:__________________________________________<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name:<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: |

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**NOTICE OF EXERCISE**

TO: AYTU BIOPHARMA, INC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Payment shall take the form of (check applicable box):

[ ] in lawful money of the United States; or

[ ] if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

_______________________________

The Warrant Shares shall be delivered to the following DWAC Account Number:

_______________________________

_______________________________

_______________________________

[SIGNATURE OF HOLDER]

Name of Investing Entity: ________________________________________________________________________

*Signature of Authorized Signatory of Investing Entity*: _________________________________________________

Name of Authorized Signatory: ___________________________________________________________________

Title of Authorized Signatory: ____________________________________________________________________

Date: ________________________________________________________________________________________

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**EXHIBIT B**

ASSIGNMENT FORM

*(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)*

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to

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| | |
|:---|:---|
| Name: | ______________________________________ |
|  | (Please Print) |
| Address: | ______________________________________ |
|  | (Please Print) |
| Phone Number: | ______________________________________ |
| Email Address: | ______________________________________ |
| Dated: _______________ __, ______ |  |
| Holder's Signature:<u> </u> |  |
| Holder's Address:<u> </u> |  |

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## Exhibit 5.1

**Exhibit 5.1**

June 2, 2025

Aytu BioPharma, Inc.

7900 East Union Avenue, Suite 920

Denver, Colorado 80237

Re: <u>Registration Statement on Form S-1</u> 

Ladies and Gentlemen:

We have acted as counsel to Aytu BioPharma Inc., a Delaware corporation (the "<u>Company</u>"), in connection with a Registration Statement on Form S-1 (the "<u>Registration Statement</u>") filed by the Securities and Exchange Commission (the "<u>Commission</u>") under the Securities Act of 1933, as amended (the "<u>Securities Act</u>"), relating to the registration by the Company of up to (i) $12,000,000 worth of shares (the "<u>Offered Shares</u>") of the Company's common stock, par value $0.0001 per share (the "<u>Common Stock</u>") and/or (ii) pre-funded warrants (the "<u>Pre-Funded Warrants</u>") exercisable for up to $12,000,000 worth of shares of Common Stock (the "<u>Pre-Funded Warrant Shares</u>") to be sold pursuant to the Underwriting Agreement (the "<u>Underwriting Agreement</u>") to be entered into by and between the Company and Lake Street Capital Markets, LLC, as representative of the several underwriters listed therein (the "<u>Underwriters</u>"). We have also granted the Underwriters an option to purchase up to an additional $1,800,000 worth of shares of the Company's Common Stock (the "<u>Optional Stock</u><u>"</u>) and/or an additional $1,800,000 worth of Pre-Funded Warrants (the "Optional <u>Pre-Funded Warrants</u>") to purchase 1,011,235 shares of Common Stock (the "Optional <u>Pre-Funded Warrant Shares</u>"). The Offered Shares, the Pre-Funded Warrants, the Pre-Funded Warrant Shares, the Optional Stock, the Optional Pre-Funded Warrants and the Optional Pre-Funded Warrant Shares to be sold by the Company are collectively referred to as the "<u>Securities</u>."

We have examined such documents and have reviewed such questions of law as we have considered necessary or appropriate for the purposes of our opinions set forth below. In rendering our opinions set forth below, we have assumed the authenticity of all documents submitted to us as originals, the genuineness of all signatures and the conformity to authentic originals of all documents submitted to us as copies. We have also assumed the legal capacity for all purposes relevant hereto of all natural persons. As to questions of fact material to our opinions, we have relied upon certificates or comparable documents of officers and other representatives of the Company and of public officials.

Based on the foregoing, we are of the opinion that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Offered Shares and Optional Stock, when issued and delivered against payment of the consideration therefor specified in the Underwriting Agreement and Registration Statement, will be validly issued, fully paid and non-assessable.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The Pre-Funded Warrants and Optional Pre-Funded Warrants when issued and delivered against payment of the consideration therefore specified in the Underwriting Agreement and Registration Statement, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The Pre-Funded Warrant Shares and Optional Pre-Funded Warrant Shares into which the Pre-Funded Warrants and Optional Pre-Funded Warrants are initially convertible, when issued and delivered upon exercise of the Pre-Funded Warrants and Optional Pre-Funded Warrant Shares in accordance with their terms, will be validly issued, fully paid and non-assessable.

Our opinions set forth above are subject to the following qualifications and exceptions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Our opinion set forth in paragraph 2 above is subject to the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar law relating to or affecting creditors' rights generally (including, without limitation, fraudulent conveyance laws).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Our opinion set forth in paragraph 2 above is subject to the effect of general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing and the possible unavailability of specific performance or injunctive relief, regardless of whether considered in a proceeding in equity or at law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Our opinion set forth in paragraph 2 above is subject to limitations regarding the availability of indemnification and contribution where such indemnification or contribution may be limited by applicable law or the application of principles of public policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) We express no opinion as to the enforceability of (i) provisions that relate to choice of law, forum selection or submission to jurisdiction (including, without limitation, any express or implied waiver of any objection to venue in any court or of any objection that a court is an inconvenient forum) to the extent that the validity, binding effect or enforceability of any such provision is to be determined by any court other than a state court of the State of New York, (ii) waivers by the Company of any statutory or constitutional rights or remedies, (iii) terms which excuse any person or entity from liability for, or require the Company to indemnify such person or entity against, such person's or entity's negligence or willful misconduct or (iv) obligations to pay any prepayment premium, default interest rate, early termination fee or other form of liquidated damages, if the payment of such premium, interest rate, fee or damages may be construed as unreasonable in relation to actual damages or disproportionate to actual damages suffered as a result of such prepayment, default or termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) We draw your attention to the fact that, under certain circumstances, the enforceability of terms to the effect that provisions may not be waived or modified except in writing may be limited.

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Our opinions expressed above are limited to the laws of the State of New York.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement, and to the reference to our firm under the heading "Legal Matters" in the prospectus constituting part of the Registration Statement. In giving this consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission thereunder.

We assume no obligation to update or supplement any of the opinions set forth herein to reflect any changes of law or fact that may occur after the date hereof.

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| |
|:---|
| Very truly yours, |
| /s/ Dorsey & Whitney LLP |

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AE/JE/MP

## Exhibit 23.1

**Exhibit 23.1**

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We have issued our report dated September 26, 2024 (except for Note 20, as to which the date is April 28, 2025), with respect to the consolidated financial statements of Aytu BioPharma, Inc. contained in the Registration Statement and Prospectus. We consent to the use of the aforementioned report in the Registration Statement and Prospectus, and to the use of our name as it appears under the caption "Experts."

/s/ GRANT THORNTON LLP

Denver, CO

June 2, 2025

## Ex-Filing

**Exhibit 107** 

**Calculation of Filing Fee Table**

**FORM S-1**

(Form Type)

**AYTU BIOPHARMA, INC.**

(Exact Name of Registrant as Specified in its Charter)

<u>Table 1: Newly Registered Securities</u>

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Security**<br> **Type** | **Fee**<br> **Calculation**<br> **or Carry**<br> **Forward**<br> **Rule** | **Amount**<br> **Registered** | **Proposed**<br> **Maximum**<br> **Offering**<br> **Price Per**<br> **Unit** | **Maximum**<br> **Aggregate**<br> **Offering**<br> **Price <sup>(1)</sup>** | **Fee**<br> **Rate** | **Amount of**<br> **Registration**<br> **Fee** |
| Fees to Be Paid | Equity<br> Common Stock, par value $0.0001 per share <sup>(2)</sup> | 457(o) |  |  | $12000000 | 0.00015310 | $1837.20 |
|  | Other<br> Prefunded Warrants to purchase shares of Common Stock <sup>(3)</sup> | Other |  |  |  |  | (3) |
|  | Equity<br> Common Stock underlying the Prefunded Warrants <sup>(2)(3)</sup> | 457(o) |  |  |  |  |  |
|  | **Total Offering Amounts** | **Total Offering Amounts** | **Total Offering Amounts** |  | $12000000 | 0.00015310 | $1837.20 |
|  | **Total Fees Previously Paid** | **Total Fees Previously Paid** | **Total Fees Previously Paid** |  |  |  |  |
|  | **Total Fee Offsets** | **Total Fee Offsets** | **Total Fee Offsets** |  |  |  |  |
|  | **Net Fee Due** | **Net Fee Due** | **Net Fee Due** |  |  |  | $1837.20 |

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&nbsp;&nbsp;&nbsp;&nbsp;(1) Estimated solely for the purpose of calculating the amount of the registration fee in pursuant to Rule 457(o) under the Securities Act of 1933, as amended (the "Securities Act")

&nbsp;&nbsp;&nbsp;&nbsp;(2) Pursuant to Rule 416 under the Securities Act, this registration statement shall also cover any additional shares of the registrant's securities that become issuable by reason of any share splits, share dividends, recapitalizations, or similar transactions.

&nbsp;&nbsp;&nbsp;&nbsp;(3) The proposed maximum aggregate offering price of the shares of Common Stock will be reduced on a dollar-for-dollar basis based on the offering price of any prefunded warrants issued in the offering, and the proposed maximum aggregate offering price of the prefunded warrants to be issued in the offering will be reduced on a dollar-for-dollar basis based on the offering price of any shares of Common Stock issued in the offering.