AYTU BIOPHARMA, INC Stock Compensation Disclosure

Note 15 - Equity Incentive Plan

 

2023 Equity Incentive Plan
 

On May 18, 2023, the Company’s stockholders approved the adoption of the Aytu BioPharma, Inc. 2023 Equity Incentive Plan (the “2023 Equity Incentive Plan”), which replaced all previous plans. For the 2023 Equity Incentive Plan, the stockholders approved (a) 200,000 new shares; (b) 87,155 shares “rolled over” to the 2023 Equity Incentive Plan from plans replaced by the 2023 Equity Incentive Plan; and (c) any shares that are returned to the Company under plans replaced by the 2023 Equity Incentive Plan to be added to the 2023 Equity Incentive Plan. On May 21, 2025, the Company’s stockholders approved an amendment (the “Plan Amendment”) to the 2023 Equity Incentive Plan. The Plan Amendment increased the number of shares reserved for issuance under the 2023 Equity Incentive Plan by 300,000 shares to bring the total number of shares reserved for issuance under the 2023 Equity Incentive Plan to 500,000 shares, not including unissued shares from available awards under prior plans or any returned shares. The Plan Amendment became effective immediately upon approval by the Company’s stockholders and the Company plans to register the 300,000 shares pursuant to a registration statement on Form S-8 to be filed with the SEC in fiscal 2026. With the approval of the 2023 Equity Incentive Plan, no additional awards will be granted under any previous 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 and previous plans typically have contractual terms of 10 years or less from the grant date and a vesting period ranging from one to four years. The restricted stock and restricted stock units granted under the 2023 Equity Incentive Plan typically have a vesting period of three to four years and restricted stock and restricted stock units granted from previous plans typically have a vesting period ranging from four to 10 years and four years, respectively. As of June 30, 2025, the Company had 397,409 shares available for grant under the 2023 Equity Incentive Plan.

 

Stock Options

 

During the year ended June 30, 2025, 87,500 stock options were granted. The weighted-average grant date fair value of options granted during the year ended June 30, 2025, was $1.83. As of  June 30, 2025, there was $0.1 million of total unrecognized compensation cost adjusted for estimated forfeitures, related to non-vested stock options granted by the Company, which is expected to be recognized over a weighted-average period of 2.0 years.

 

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. As of  June 30, 2024, there was $0.2 million of total unrecognized compensation cost adjusted for estimated forfeitures, related to non-vested stock options granted by the Company.

 

Stock option activity during the year ended June 30, 2025, is as follows:

 

										Weighted-
										Average
						Weighted-				Remaining
		Number of				Average				Contractual
		Options				Exercise Price				Life in Years
Outstanding at June 30, 2024			146,539			$	6.18				8.8
Granted			87,500			$	1.83				8.3
Forfeited/cancelled			(17,343	)		$	1.87				—
Expired			(5,078	)		$	15.46				—
Outstanding at June 30, 2025			211,618			$	4.51				8.3
Exercisable at June 30, 2025			100,195			$	7.44				7.4

 

The following table details the options outstanding as of  June 30, 2025, by range of exercise prices:

 

											Weighted-
											Average
											Remaining
							Weighted-				Contractual
Range of			Number of				Average				Life of				Number of				Weighted-
Exercise			Options				Exercise				Options				Options				Average
Prices			Outstanding				Price				Outstanding				Exercisable				Exercise Price
$1.69				3,000			$	1.69				9.6				—			$	—
$1.73				87,453			$	1.73				8.0				59,901			$	1.73
$1.84				79,000			$	1.84				9.4				2,500			$	1.84
$2.53 - $290.00				42,165			$	15.49				6.6				37,794			$	15.49
				211,618			$	4.51				8.3				100,195			$	7.44

 

Restricted Stock

 

During the year ended June 30, 2025, the Company granted a total of 20,000 shares of restricted stock, with certain accelerated vesting conditions, to members of its non-employee directors and its management team pursuant to the 2023 Equity Incentive Plan, that vest between one year and three years from the grant date, subject to continuing service to the Company through each vesting date. These restricted stock grants have a weighted-average grant date fair value of $1.79 per share. As of June 30, 2025, there was $0.7 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 1.9 years.

 

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.

 

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

 

						Weighted-
						Average Grant
		Number of				Date Fair
		Shares				Value
Unvested at June 30, 2024			24,105			$	100.34
Granted			20,000			$	1.79
Vested			(11,193	)		$	14.02
Unvested at June 30, 2025			32,912			$	69.81

 

As of  June 30, 2025, there were four shares of unvested restricted stock that were granted outside of equity compensation plans approved by security holders, which had less than $0.1 million of total unrecognized compensation costs and a remaining weighted-average vesting period of 1.0 years.

 

Restricted Stock Units

 

For the years ended June 30, 2025, and 2024, the Company did not grant any restricted stock units and there were no remaining unvested restricted stock units as of June 30, 2025. Restricted stock unit activity is as follows:

 

						Weighted-
						Average Grant
		Number of				Date Fair
		Shares				Value
Unvested at June 30, 2024			1,775			$	24.14
Vested			(1,608	)		$	23.93
Forfeited/cancelled			(167	)		$	26.20
Unvested at June 30, 2025			—			$	—

 

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

 

		Year Ended
		June 30,
		2025				2024
		(in thousands)
Cost of goods sold		$	2			$	2
Research and development			11				6
Selling and marketing			61				—
General and administrative			502				2,365
Net income (loss) from discontinued operations, net of tax			—				540
Total stock-based compensation expense		$	576			$	2,913