UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ Quarterly Report Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2024

Commission File Number: 001-27072

AIM IMMUNOTECH INC.

(Exact name of registrant as specified in its charter)

Delaware		52-0845822
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

2117 SW Highway 484, Ocala FL 34473

(Address of principal executive offices) (Zip Code)

(352) 448-7797

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol		Name of each exchange on which registered
Common Stock, par value $0.001 per share		AIM		NYSE American

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit and post such files).

☒ Yes ☐ No

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

☐ 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 pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

51,281,437 shares of common stock were outstanding, and no shares of series B preferred stock were outstanding as of May 13, 2024.

PART I- FINANCIAL INFORMATION

ITEM 1: Financial Statements

AIM IMMUNOTECH INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(in thousands, except for share and per share amounts)

(Unaudited March 31, 2024 and Audited December 31, 2023)

	March 31, 2024			December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	3,295		$	5,439
Marketable investments		7,647			7,631
Funds receivable from New Jersey net operating loss and Other Receivables		—			1,184
Prepaid expenses and other current assets		364			302
Total current assets		11,306			14,556
Property and equipment, net		118			127
Right of use asset, net		763			697
Patent and trademark rights, net		2,314			2,313
Other assets		1,688			1,688
Total assets	$	16,189		$	19,381
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	6,567		$	6,443
Accrued expenses		1,446			1,986
Current portion of operating lease liability		240			223
Current portion of note payable, net		1,623			—
Total current liabilities		9,876			8,652
Long-term liabilities:
Operating lease liability		537			495
Note payable, net		950			—
Total liabilities		11,363			9,147
Commitments and contingencies (Notes 9, 10 and 14)		-

Stockholders’ equity:
Series A Junior Participating Preferred Stock, $0.001 par value, 4,000,000 and 250,000 shares authorized as of March 31, 2024, and December 31, 2023, respectively; issued and outstanding – none		—			—
Series B Convertible Preferred Stock, stated value $1,000 per share, 10,000 shares authorized; 689 and 689 issued and outstanding as of March 31, 2024 and December 31, 2023, respectively		689			689
Preferred Stock, Value
Common Stock, $0.001 par value, authorized shares - 350,000,000; issued and outstanding shares 50,251,933 and 49,102,484 as of March 31, 2024 and December 31, 2023, respectively		50			49
Additional paid-in capital		419,412			419,004
Accumulated deficit		(415,325	)		(409,508	)
Total stockholders’ equity		4,826			10,234
Total liabilities and stockholders’ equity	$	16,189		$	19,381

See accompanying notes to consolidated financial statements.

AIM IMMUNOTECH INC. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Loss

(in thousands, except share and per share data)

(Unaudited)

	2024			2023
	Three months ended March 31,
	2024			2023
Revenues:
Clinical treatment programs – US	$	40		$	49
Total Revenues		40			49
Costs and Expenses:
Production costs		8			—
Research and development		1,951			2,052
General and administrative		3,815			2,292
Total Costs and Expenses		5,774			4,344
Operating loss		(5,734	)		(4,295	)
Gain (Loss) on investments		(92	)		203
Interest and other income		81			199
Interest Expense and Other Finance Costs		(72	)		—
(Loss) on sale of assets		—			(23	)
Gain from sale of income tax operating losses		—			255
Net Loss	$	(5,817	)	$	(3,661	)
Basic and diluted loss per share	$	(0.12	)	$	(0.08	)
Weighted average shares outstanding basic and diluted		49,458,023			48,399,950

See accompanying notes to consolidated financial statements.

AIM IMMUNOTECH INC. AND SUBSIDIARIES

Consolidated Statements of Changes in Stockholders’ Equity

(in thousands except share data)

	Series B Preferred Shares		Common Stock Shares		Common Stock .001 Par Value		Additional Paid-in Capital		Accumulated other Comprehensive Income (Loss)		Accumulated Deficit			Total Stockholders’ Equity
Balance December 31, 2023		689		49,102,484	$	49	$	419,004	$	—	$	(409,508	)	$	10,234
Shares issued for:
Common Stock issuance, net of costs		—		807,577		1		328		—		—			329
Cashless Exercise of Warrants		—		3,272		—		—		—		—			—
Equity based compensation		—		—		—		80		—		—			80
Series B preferred shares converted to common		—		—		—		—		—		—			—
Committed Shares		—		338,600		—		—		—		—			—
Net comprehensive loss		—		—		—		—		—		(5,817	)		(5,817	)
Balance March 31, 2024		689		50,251,933	$	50	$	419,412	$	—	$	(415,325	)	$	4,826

	Series B Preferred Shares			Common Stock Shares		Common Stock .001 Par Value		Additional Paid-in Capital		Accumulated other Comprehensive Income (Loss)		Accumulated Deficit			Total Stockholders’ Equity
Balance December 31, 2022		696			48,084,287	$	48	$	418,270	$	—	$	(380,546	)	$	38,468
Balance ,value		696			48,084,287	$	48	$	418,270	$	—	$	(380,546	)	$	38,468
Shares issued for:
Common Stock issuance, net of costs		—			322,583		—		100		—		—			100
Equity based compensation		—			—		—		82		—		—			82
Series B preferred shares converted to common		(4	)		456		—		4		—		—			—
Net comprehensive loss		—			—		—		—		—		(3,661	)		(3,661	)
Balance March 31, 2023		692			48,407,326	$	48	$	418,456	$	—	$	(384,207	)	$	34,989
Balance ,value		692			48,407,326	$	48	$	418,456	$	—	$	(384,207	)	$	34,989

See accompanying notes to consolidated financial statements.

AIM IMMUNOTECH INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the Three Months Ended March 31, 2024 and 2023

(in thousands)

(Unaudited)

	2024			2023
Cash flows from operating activities:
Net loss	$	(5,817	)	$	(3,661	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation of property and equipment		9			11
Amortization of patent, trademark rights		49			36
Amortization of Debt Discount and Other Expenses		73			—
Non-cash lease expense		(67	)		37
Gain from sale of income tax operating losses		—			(255	)
Equity-based compensation		80			82
Loss (gain) on sale of marketable investments		92			(203	)
Change in assets and liabilities:
Funds receivable from New Jersey net operating loss		1,184			—
Prepaid expenses and other current assets and other non-current assets		(62	)		(180	)
Lease liability		60			(23	)
Accounts payable		124			586
Accrued expenses		(540	)		(110	)
Net cash used in operating activities		(4,815	)		(3,680	)
Cash flows from investing activities:
Proceeds from sale of marketable investments		50			598
Purchase of marketable investments		(158	)		(712	)
(Purchase) abandonment of patent and trademark rights		(50	)		7
Proceeds from sales of property and equipment		—			29
Net cash used in investing activities		(158	)		(78	)
Cash flows from financing activities:
Proceeds from sale of stock, net of issuance costs		329			100
Proceeds from note payable, net of issuance costs		2,500			—
Net cash provided by financing activities		2,829			100
Net decrease in cash and cash equivalents		(2,144	)		(3,658	)
Cash and cash equivalents at beginning of period		5,439			27,053
Cash and cash equivalents at end of period	$	3,295		$	23,395
Supplemental disclosures of non-cash investing and financing cash flow information:
Conversion of Series B preferred	$	—			4

See accompanying notes to consolidated financial statements.

AIM IMMUNOTECH INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1: Business and Basis of Presentation

AIM ImmunoTech Inc. and its subsidiaries (collectively, “AIM”, “Company”, “we” or “us”) are an immuno-pharma company headquartered in Ocala, Florida, and focused on the research and development of therapeutics to treat multiple types of cancers, viral diseases and immune-deficiency disorders. We have established a strong foundation of laboratory, pre-clinical and clinical data with respect to the development of nucleic acids and natural interferon to enhance the natural antiviral defense system of the human body, and to aid the development of therapeutic products for the treatment of certain cancers and chronic diseases.

AIM’s flagship products are Ampligen (rintatolimod), a first-in-class drug of large macromolecular RNA (ribonucleic acid) molecules, and Alferon N Injection (Interferon alfa). Ampligen has not been approved by the FDA or marketed in the United States. Ampligen is approved for commercial sale in the Argentine Republic for the treatment of severe Chronic Fatigue Syndrome (“CFS”).

The Company’s primary business focus involves Ampligen. Ampligen is a double-stranded RNA (“dsRNA”) molecule being developed for globally important cancers, viral diseases and disorders of the immune system.

The Company is currently proceeding primarily in four areas:

	●	Conducting a randomized, controlled study to evaluate efficacy and safety of Ampligen compared to a control group to treat locally advanced pancreatic cancer patients.
	●	Evaluating Ampligen in other cancers, as a potential therapy that modifies the tumor microenvironment with the goal of increasing anti-tumor responses to checkpoint inhibitors.
	●	Exploring Ampligen’s antiviral activities and potential use as a prophylactic or treatment for existing viruses, new viruses and mutated viruses thereof.
	●	Evaluating Ampligen as a treatment for myalgic encephalomyelitis/chronic fatigue syndrome (“ME/CFS”) and fatigue and/or Post-COVID conditions of fatigue.

The Company is prioritizing activities in an order related to the stage of development, with those clinical activities such as pancreatic cancer, ME/CFS and Post-COVID conditions having priority over antiviral experimentation. The Company intends that priority clinical work be conducted in trials authorized by the FDA or European Medicines Agency (“EMA”), which trials support a potential future NDA. However, AIM’s antiviral experimentation is designed to accumulate additional preliminary data supporting their hypothesis that Ampligen is a powerful, broad-spectrum prophylaxis and early-onset therapeutic that may confer enhanced immunity and cross-protection. Accordingly, AIM will conduct antiviral programs in those venues most readily available and able to generate valid proof-of-concept data, including foreign venues.

AIM’s business plan requires one or more Contract Manufacturing Organizations (“CMO”) to produce Ampligen and its Active Pharmaceutical Ingredients (APIs). This includes utilizing Jubilant HollisterStier and Sterling for the manufacture of Ampligen and our Poly I and Poly C12U polynucleotides, respectively. Additionally, our relationship with Polysciences Inc. (“Polysciences”) continues and R&D development of polymer manufacture is ongoing.

In the opinion of management, all adjustments necessary for a fair presentation of its consolidated financial statements have been included. Such adjustments consist of normal recurring items. Interim results are not necessarily indicative of results for a full year.

The interim consolidated financial statements and notes thereto are presented as permitted by the Securities and Exchange Commission (“SEC”), and do not contain certain information which will be included in the Company’s annual consolidated financial statements and notes thereto.

These consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements for the years ended December 31, 2023, and 2022, contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed on March 29, 2024.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure (“GAAP”) of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses for the reporting period. Actual results could differ from those estimates, and those differences may be material. Accounts requiring the use of significant estimates include determination of other-than-temporary impairment on securities, valuation of deferred taxes, patent and trademark valuations, equity-based compensation calculations, fair value of warrants, and contingency accruals.

Note 2: Cash and Cash Equivalents

Cash includes bank deposits maintained at several financial institutions. The Company considers highly liquid instruments with an original maturity of three months or less to be cash equivalents. At various times throughout the three months ended March 31, 2024, some accounts held at financial institutions were in excess of the federally insured limit of $250,000. The Company has not experienced any losses on these accounts and believes credit risk to be minimal.

Note 3: Marketable Investments

Marketable investments consist of mutual funds. At March 31, 2024 and December 31, 2023, it was determined that none of the marketable investments had an other-than-temporary impairment. At March 31, 2024 and December 31, 2023, all securities were measured as Level 1 instruments of the fair value measurements standard (See Note 7: Fair Value). At March 31, 2024, and December 31, 2023 the Company held $7,647,000 and $7,631,000, respectively, in mutual funds.

Mutual Funds classified as available for sale consisted of:

Schedule of Available of Sale

	March 31, 2024 (in thousands)
Securities	Fair Value		Short-Term Investments
Mutual Funds	$	7,647	$	7,647
Totals	$	7,647	$	7,647

Schedule of Equity Securities

Securities	March 31, 2024 (in thousands)
Net gains and losses recognized during the period on equity securities	$	(92	)
Less: Net gains and losses recognized during the period on equity securities sold during the period		(20	)
Unrealized gains and losses recognized during the reporting period on equity securities still held at the reporting date	$	(72	)

Mutual Funds classified as available for sale consisted of:

	December 31, 2023 (in thousands)
Securities	Fair Value		Short-Term Investments
Mutual Funds	$	7,631	$	7,631
Totals	$	7,631	$	7,631

Securities	March 31, 2023 (in thousands)
Net losses recognized during the period on equity securities	$	290
Less: Net gains and losses recognized during the period on equity securities sold during the period		(87	)
Unrealized gains and losses recognized during the reporting period on equity securities still held at the reporting date	$	203

Note 4: Property and Equipment, net

Schedule of Property and Equipment

	March 31, 2024			December 31, 2023
	(in thousands)
	March 31, 2024			December 31, 2023
Furniture, fixtures, and equipment	$	1,448		$	1,448
Less: accumulated depreciation		(1,330	)		(1,321	)
Property and equipment, net	$	118		$	127

Property and equipment are recorded at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the respective assets, ranging from three to ten years. Depreciation expense for the three months ending March 31, 2024 and March 31, 2023 was $9,000 and $11,000, respectively.

Note 5: Patents and Trademark Rights, Net

Patent and trademark rights consist of the following (in thousands):

	March 31, 2024							December 31, 2023
	Gross Carrying Value		Accumulated Amortization			Net Carrying Value		Gross Carrying Value		Accumulated Amortization			Net Carrying Value
Patents	$	2,995	$	(794	)	$	2,201	$	2,947	$	(750	)	$	2,197
Trademarks		231		(118	)		113		229		(113	)		116
Net amortizable patents and trademarks rights	$	3,226	$	(912	)	$	2,314	$	3,176	$	(863	)	$	2,313

December 31, 2023	$	2,313
Acquisitions		50
Abandonments		—
Amortization		(49	)
March 31, 2024	$	2,314

Patents and trademarks are stated at cost (primarily legal fees) and are amortized using the straight-line method over an estimated useful life of 17 years for patents and 10 years for trademarks. The weighted remaining average amortization period is approximately 12 years for patents and 7 years for trademarks, respectively. The company expenses annuity costs related to its trademarks and patents.

Amortization of patents and trademarks for each of the next five years and thereafter is as follows:


Year Ending December 31,
2024	$	186
2025		237
2026		235
2027		212
2028		193
Thereafter		1,251
Total	$	2,314

Note 6: Leases

The Company leases office and lab facilities and other equipment under non-cancellable operating leases with initial terms typically ranging from 1 to 5 years, expiring at various dates during 2024 through 2027, and requiring monthly payments ranging from less than $1,000 to $17,000. Certain leases include additional renewal options ranging from 1 to 5 years. AIM has classified all of its leases as operating leases.

At March 31, 2024 and December 31, 2023, the balance of the right of use assets was $763,000 and $697,000, respectively, and the corresponding operating lease liability balance was $777,000 and $718,000, respectively. Right of use assets are recorded net of accumulated amortization of $296,000 and $363,000 as of March 31, 2024 and December 31, 2023, respectively.

AIM recognized rent expense associated with these leases are follows:

	March 31, 2024		December 31, 2023
	(in thousands)
	March 31, 2024		March 31, 2023
Lease costs:
Operating lease costs	$	74	$	68
Short-term and variable lease costs		49		19

Total lease costs	$	123	$	87
Classification of lease costs
Research & development	$	101	$	19
General and administrative		22		68
Lease cost		22		68

Total lease costs	$	123	$	87

The Company’s leases have remaining lease terms between 11 and 40 months. As of March 31, 2024, the weighted-average remaining term was 39 months. At December 31, 2023, the weighted-average remaining term was 41 months. The Company’s weighted average incremental borrowing rate for its leases was 10% at March 31, 2024 and December 31, 2023.

Future minimum payments as of March 31, 2024, are as follows:

Year Ending December 31, (in thousands)
2024	$	229
2025		273
2026		244
2027		159
Thereafter		—
Less imputed interest		(128	)
Total	$	777

Note 7: Fair Value

Fair Value

The Company complies with the provisions of FASB ASC 820 “Fair Value Measurements” for its financial and non-financial assets and liabilities. ASC 820 defines fair value, establishes a framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis.

The Company accounts for certain assets and liabilities at fair value. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. AIM categorizes each of its fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are:

	1.	Level 1 – Quoted prices are available in active markets for identical assets or liabilities at the reporting date. Generally, this includes debt and equity securities that are traded in an active market.
	2.	Level 2 – Observable inputs other than Level 1 prices such as quote prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Generally, this includes debt and equity securities that are not traded in an active market.
	3.	Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or other valuation techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. As of March 31, 2024, the Company has classified the warrants with cash settlement features as Level 3. Management evaluates a variety of inputs and then estimates fair value based on those inputs. As discussed above, the Company utilized the Monte Carlo Simulation Model in valuing the warrants.

The table below presents the balances of assets and liabilities measured at fair value on a recurring basis by level within the hierarchy as (in thousands):

	As of March 31, 2024
	Total		Level 1		Level 2		Level 3
Assets:
Cash equivalents	$	1,478	$	1,478	$	—	$	—
Marketable investments	$	7,647	$	7,647	$	—	$	—

	As of December 31, 2023
	Total		Level 1		Level 2		Level 3
Assets:
Cash equivalents	$	4,805	$	4,805	$	—	$	—
Marketable investments	$	7,631	$	7,631	$	—	$	—

The Company’s cash balances are representative of their fair values as these balances are comprised of deposits available on demand. For certain instruments, including funds receivable from New Jersey net operating loss, accounts payable and accrued expenses, it was estimated that the carrying values approximated the fair value due to the short-term maturities of these instruments (Level 1).

The Company also had certain redeemable warrants in the Rights Offering with a cash settlement feature in the occurrence of a Fundamental Transaction. No Fundamental Transaction occurred. During the first quarter 2024, 205,000 of these Warrants converted on a cashless basis and the balance expired.

Note 8: Accrued Expenses

Accrued expenses consist of the following:

Schedule of Accrued Expenses

	March 31, 2024		December 31, 2023
	(in thousands)
	March 31, 2024		December 31, 2023
Compensation	$	451	$	414
Professional fees		881		1,352
Clinical trial expenses		103		184
Other expenses		11		36
Total	$	1,446	$	1,986

Note 9: Unsecured Promissory Note

On February 16, 2024, the Company (“Borrower”) entered into a Note Purchase Agreement with Streeterville Capital LLC (“Streeterville”or the “Lender”). Under the terms of the agreement, Streeterville paid the Company $2,500,000 in exchange for an unsecured promissory Note with an Original Issue Discount of $781,250. The Company will pay $3,301,250 consisting of the principal amount of the Note, together with the original issue discount and $20,000 of lender transaction fees, no later than February 16, 2026. The stated interest rate of the note is 10%.

The following table summarizes our debt at March 31, 2024 and December 31, 2023:

(in thousands)

Schedule of Long Term Debt

	March 31, 2024			December 31, 2023
Long-term debt	$	3,330		$	-
Unamortized Original issue discount		(738	)		-
Unamortized Financing fees		(19	)		-
		2,573			-
Less current portion of long-term debt, net (1)		(1,623	)		-

Long-term debt (2)	$	950		$	-

Interest costs expensed and capitalized related to long-term debt were as follows:

(in thousands)

	March 31, 2024		December 31, 2023
Interest expense	$	29	$	-
Interest capitalized		-		-

Total	$	29	$	-

Amortization expenses related to long-term debt were as follows:

(in thousands)

	March 31, 2024		December 31, 2023
Original issue discount	$	43	$	-
Loan fee amortization		1		-

Total	$	44	$	-

Future maturities of long-term debt as of March 31, 2024 were as follows:

(in thousands)

Fiscal years ending December 31:

2024	$	1,250
2025		2,080

Total	$	3,330

	(1)	Current portion of long-term debt of approximately $2,000,000 is net of the current portion of debt discount of approximately $367,000 and the current portion of debt origination costs of approximately $10,000 as of March 31, 2024.

	(2)	Long-term portion of debt of approximately $1,330,000 is net of the long-term portion of debt discount of approximately $371,000 and the unamortized debt origination costs of approximately $9,000 as of March 31, 2024.

The agreement allows the Lender to redeem up to $250,000 per calendar month beginning in August 2024, upon providing written notice to Borrower. The Note further contains triggering events which can be remedied by the Lender requiring the Borrower to correct the triggering event, increasing the outstanding balance by applying the triggering effect, or making the Note immediately due and payable.

Note 10: Equity Purchase Agreement

On March 28, 2024, the Company entered into a purchase agreement and a registration rights agreement (collectively, the “Atlas Agreements”) with Atlas Sciences, LLC (“Atlas”), pursuant to which Atlas committed to purchase up to $15,000,000 of common stock of the Company for a period of 24 months from the date of the agreement.

Under the terms of the agreement, the Company, at its sole discretion, shall have the right to issue Put shares to the Investor at 95% of the Market Price of the shares on the day of trade. Sales under the agreement are limited to a daily maximum of the lessor of: $500,000, the Median Daily Trading volume, and a beneficial ownership limitation of 4.99% and a maximum of 19.99% of the outstanding shares at the time of the agreement. As of March 31, 2024, no sales or purchases had been made pursuant to this agreement. In April 2024, the Company filed a registration statement with the SEC on Form S-1 registering a total of 9,975,000 shares for resale pursuant to the Atlas Agreements, consisting of 9,636,400 shares that can be sold by the Company to Atlas and 338,600 shares that were issued to Atlas as Commitment Shares.

Note 11: Stockholders’ Equity

(a) Preferred Stock

The Company is authorized to issue 5,000,000 shares of $0.01 par value preferred stock with such designations, rights and preferences as may be determined by the Board. Of our authorized preferred stock, 4,000,000 shares have been designated as Series A Junior Participating Preferred Stock and 10,000 shares have been designated as Series B Convertible Preferred Stock.

Series A Junior Participating Preferred Stock

On May 10, 2023, the Company filed a Certificate of Increase in Delaware, increasing the number of preferred stock designated as Series A Junior Participating Preferred Stock to 4,000,000 from 250,000 shares. As of March 31, 2024, there were no Series A Junior Participating Preferred Stock outstanding.

Series B Convertible Preferred Stock

The Company has designated 10,000 shares of its preferred stock as Series B Convertible Preferred Stock (the “Preferred Stock”). Each share of Preferred Stock has a par value of $0.01 per share and a stated value equal to $1,000 (the “Stated Value”). The shares of Preferred Stock shall initially be issued and maintained in the form of securities held in book-entry form and the Depository Trust Company or its nominee (“DTC”) shall initially be the sole registered holder of the shares of Preferred Stock.

Each share of Preferred Stock shall be convertible, at any time and from time to time from and after the Original Issue Date at the option of the Holder thereof or at any time and from time to time on or after the second anniversary of the Original Issue Date at the option of the Corporation, into that number of shares of Common Stock (subject in each case to the limitations determined by dividing the Stated Value of such share of Preferred Stock by the Conversion Price). The conversion price for the Preferred Stock shall be equal to $0.20, subject to adjustment herein (the “Conversion Price”).

Pursuant to a registration statement relating to a rights offering (the “Rights Offering”) declared effective by the SEC on February 14, 2019, AIM distributed to its holders of common stock and to holders of certain options and redeemable warrants as of February 14, 2019, at no charge, one non-transferable subscription right for each share of common stock held or deemed held on the record date. Each right entitled the holder to purchase one unit, at a subscription price of $1,000 per unit, consisting of one share of Series B Convertible Preferred Stock with a face value of $1,000 (and immediately convertible into common stock at an assumed conversion price of $8.80) and 114 warrants with an assumed exercise price of $8.80. The redeemable warrants are exercisable for five years after the date of issuance. The net proceeds realized from the rights offering were approximately $4,700,000. During the three months ended March 31, 2024, no shares of Series B Convertible Preferred Stock were converted into common stock.

At March 31, 2024 and December 31, 2023, the Company had 689 shares of Series B Convertible Preferred Stock outstanding. Holders shall be entitled to receive, and the Company shall pay, dividends on shares of Series B Preferred Stock equal (on an as-if-converted-to-Common-Stock basis) to and in the same form as dividend actually paid on shares of Common Stock when as and if such dividends are paid on shares of the Common Stock. Each such Preferred Share is convertible into 114 shares of common stock. Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, the Holders shall be entitled to receive out of the assets, whether capital or surplus of the Company the same amount that a holder of Common Stock would receive if the Preferred Stock was fully converted. The Series B Convertible Preferred Stock does not carry voting Rights. Subsequent to March 31, 2024, 689 shares of Series B Convertible Preferred Stock expired, and none were converted prior to expiration.

(b) Common Stock and Equity Finances

The Company has authorized shares of 350,000,000 with specific limitations and restrictions on the usage of 8,000,000 of the 350,000,000 authorized shares. As of March 31, 2024 and December 31, 2023, there were 50,251,933 and 49,102,484 shares of Common Stock issued and outstanding, respectively.

Employee Stock Purchase Plan (Not equity compensation)

On July 7, 2020, the Board approved a plan pursuant to which all directors, officers, and employees could purchase from the Company up to an aggregate of $500,000 worth of shares at the market price (including subsequent plans, the “Employee Stock Purchase Plan”). Pursuant to NYSE American rules, this plan was effective for a sixty-day period commencing upon the date that the NYSE American approved the Company’s Supplemental Listing Application. The Company created successive new plans following the expiration of the July 7, 2020 plan. The latest plan was approved by the Board on May 10, 2024 and expires in July 2024.

During the three months ended March 31, 2024, the Company issued a total of 243,009 shares of its Common Stock at a price ranging from $0.33 to $0.39 for total proceeds of approximately $82,500 as part of the employee stock purchase plan.

During the three months ended March 31, 2023, the Company issued a total of 322,583 shares of its Common Stock at a price of $0.31 for total proceeds of approximately $100,000 as part of the employee stock purchase plan.

Warrants (Rights offering)

On September 27, 2019, the Company closed a public offering underwritten by A.G.P./Alliance Global Partners, LLC (the “Offering”) of (i) 1,740,550 shares of Common Stock; (ii) pre-funded warrants exercisable for 7,148,310 shares of Common Stock (the “Pre-funded Warrants”), and (iii) warrants to purchase up to an aggregate of 8,888,860 shares of Common Stock (the “Warrants”). In conjunction with the Offering, we issued a Representative’s Warrant to purchase up to an aggregate of 266,665 shares of common stock (the “Representative’s Warrant”). The shares of Common Stock and Warrants were sold at a combined Offering price of $0.90, less underwriting discounts and commissions. Each Warrant sold with the shares of Common Stock represents the right to purchase one share of Common Stock at an exercise price of $0.99 per share. The Pre-Funded Warrants and Warrants were sold at a combined Offering price of $0.899, less underwriting discounts and commissions. The Pre-Funded Warrants were sold to purchasers whose purchase of shares of Common Stock in the Offering would otherwise result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% of the Company’s outstanding Common Stock immediately following the consummation of the Offering, in lieu of shares of Common Stock. Each Pre-Funded Warrant represents the right to purchase one share of Common Stock at an exercise price of $0.001 per share. The Pre-Funded Warrants are exercisable immediately and may be exercised at any time until the Pre-Funded Warrants are exercised in full. A registration statement on Form S-1, relating to the Offering was filed with the SEC and was declared effective on September 25, 2019, the net proceeds were approximately $7,200,000. During the year ended December 31, 2020, 1,870,000 of the Pre-funded Warrants were exercised and 8,873,960 Warrants were exercised. In addition, on March 25, 2020, the Representative’s Warrant was amended to permit exercise of such warrant to commence on March 30, 2020. These warrants were exercised on March 31, 2020 and an aggregate of 266,665 shares were issued upon exercise of this warrant for gross proceeds of approximately $264,000 and a $46,000 expense for the warrant modification. During the three months ended March 31, 2024, 205,000 Warrants were exercised, and 5,830,028 Warrants expired unexercised. During the three months ended March 31, 2023, there were no Warrants exercised. As of March 31, 2024 and December 31, 2023 there were 15,000 and 152,160 post split Warrants outstanding, respectively.

Equity Distribution Agreement

On April 19, 2023, the Company entered into an Equity Distribution Agreement (the “EDA”) with Maxim Group LLC (“Maxim”), pursuant to which the Company may sell, from time to time, shares of its common stock having an aggregate offering price of up to $8,500 000 through Maxim, as agent (the “Offering”). Sales under the EDA were registered under the S-3 Shelf Registration Statement. Under the terms of the EDA, Maxim will be entitled to a transaction fee at a fixed rate of 3.0% of the gross sales price of shares sold under the EDA. For the three months ended March 31, 2024, the Company sold 564,568 shares under the EDA for total gross proceeds of approximately $253,870, which includes a 3.0% fee to Maxim of $7,616. During the year ended December 31, 2023, the Company sold 598,114 shares under the EDA for total gross proceeds of approximately $344,000, which includes a 3.0% fee to Maxim of $10,326. Subsequent to March 31, 2024, the Company sold 730,110 shares under the EDA for total gross proceeds of $372,223, which includes a 3.0% fee to Maxim of $11,167.

Rights Plan

On May 12, 2023, the Company amended and restated its November 14, 2017 Rights Plan with American Stock Transfer & Trust Company as Rights Agent (the “Rights Plan”).

Note 12: Net Loss Per Share

Basic and diluted net loss per share is computed using the weighted average number of shares of common stock outstanding during the period. Equivalent common shares, consisting of stock options and warrants which amounted to 3,386,789 and 2,522,390, are excluded from the calculation of diluted net loss per share for the three months ended March 31, 2024, and 2023, respectively, since their effect is antidilutive due to the net losses recorded for the periods.

Note 13: Equity-Based Compensation

The 2018 Equity Incentive Plan, effective September 12, 2018, as amended and restated on August 19, 2019 (the “2018 Equity Incentive Plan”) authorizes the grant of (i) Incentive Stock Options, (ii) Nonstatutory Stock Options, (iii) Stock Appreciation Rights, (iv) Restricted Stock Awards, (v) Restricted Stock Unit Awards, (vi) Performance Stock Awards, (vii) Performance Cash Awards, and (viii) Other Stock Awards. Initially, a maximum of 7,000,000 shares of Common Stock were reserved for potential issuance pursuant to awards under the 2018 Equity Incentive Plan. When the plan was amended and restated, an additional 250,000 shares were reserved for potential issuance pursuant to awards under the 2018 Equity Incentive Plan. The number of shares of the Company’s common stock available for grant and issuance under the 2018 Equity Incentive Plan is subject to an annual increase on July 1 of each calendar year, by an amount equal to two percent (2%) of the then outstanding shares of the Company’s common stock (the “2018 Plan Evergreen Provision”). On August 3, 2020 and July 1, 2021, 2022 and 2023, the number of shares of the Company’s common stock available for grant and issuance under the 2018 Equity Incentive Plan increased by 979,311shares , 956,660 shares, 960,976 shares and 968,389 shares, respectively. As a result of the 2018 Plan Evergreen Provisions, a maximum of 10,865,336 shares of Common Stock is reserved for potential issuance pursuant to awards under the 2018 Equity Incentive Plan as of January 1, 2024. Unless sooner terminated, the 2018 Equity Incentive Plan will continue in effect for a period of 10 years from its effective date. During the fiscal year ending December 31, 2018 the Board of Directors (the “Board”) issued 1,189,284 options to each employee, the officers and directors at the exercise price of $9.68 expiring in 10 years. During the fiscal year ending December 31, 2019, 1,727,756 options were issued to each of these officers with an exercise price of $9.68 for a period of ten years with a vesting period of one year. During the fiscal year ending December 31, 2020, 1,025,000 options were issued to each of these officers and directors with an exercise price range of $2.77 to $3.07 for a period of ten years with a vesting period of one year During the fiscal year ending December 31, 2021, 613,512 options were issued to officers, directors and consultants with an exercise price range of $1.11 to $1.71 for a period of ten years with a vesting period of one year. During the fiscal year ending December 31, 2022, 850,000 options were issued to officers, directors and consultants with an exercise price range of $0.31 to $0.71 for a period of ten years with a vesting period of one year. During the fiscal year ending December 31, 2023, 400,000 options were issued to officers with an exercise price range of $0.47 for a period of ten years with a vesting period of one year. During the three months ended March 31, 2024 there were no options issued.

The fair value of each option and equity warrant award is estimated on the date of grant using a Black-Scholes-Merton option pricing valuation model. Expected volatility is based on the historical volatility of the price of the Company’s stock. The risk-free interest rate is based on U.S. Treasury issues with a term equal to the expected life of the option and equity warrant. The Company uses historical data to estimate expected dividend yield, expected life and forfeiture rates. During the three months ended March 31, 2023 and 2024, there were no options granted.

Stock options activity during the three months ended March 31, 2024, was as follows:

Stock option activity for employees:

Schedule of Stock Option Activity

	Number of Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding January 1, 2024		2,408,438	$	2.50		8.70	$	—
Granted		—		—		—		—
Forfeited		—		—		—		—
Expired		—		—		—		—
Outstanding March 31, 2024		2,408,438	$	2.50		8.70	$	—
Vested and expected to vest March 31, 2024		2,141,772	$	1.83		6.89	$	—
Exercisable March 31, 2024		2,141,772	$	1.83		6.89	$	—

Unvested stock option activity for employees:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Unvested January 1, 2024		366,666		$	2.13		12.44	$	—
Granted		—			—		—		—
Expired		—			—		—		—
Vested		(100,000	)		0.47		6.89		—
Unvested March 31, 2024		266,666		$	2.75		14.52	$	—

Stock option activity for non-employees:

Schedule of Stock Option Activity

	Number of Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding January 1, 2024		885,055	$	2.02		9.23	$	—
Granted		—		—		—		—
Forfeited		—		—		—		—
Expired		—		—		—		—
Outstanding March 31, 2024		885,055	$	2.02		9.23	$	—
Vested and expected to vest March 31, 2024		640,055	$	2.27		10.04	$	—
Exercisable March 31, 2024		640,055	$	2.27		10.04	$	—

Unvested stock option activity for non-employees:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Unvested January 1, 2024		335,001		$	1.83		10.70	$	—
Granted		—			—		—		—
Expired		—			—		—		—
Vested		(90,000	)		0.46		9.47		—
Unvested March 31, 2024		245,001		$	2.33		11.15	$	—

Stock-based compensation expense was approximately $80,000 and $82,000 for the three months ended March 31, 2024 and 2023, resulting in a decrease in general and administrative expenses, respectively.

As of March 31, 2024, and 2023, respectively, there was approximately $214,000 and $134,000 of unrecognized equity-based compensation cost related to options granted under the Equity Incentive Plan.

Note 14: Research, Consulting and Supply Agreements

The Company has entered into research, consulting and supply agreements with third party service providers to perform research and development activities on therapeutics, including clinical trials. The identification of research and development costs involves reviewing open contracts and purchase orders, communicating with applicable company and third-party personnel to identify services that have been performed, and corroborating the level of service performed and the associated cost incurred for the service when the Company has not yet been invoiced or otherwise notified of actual expenses. The Company expenses these research and development costs when incurred.

During the three months ended March 31, 2024, research and development expenses were comprised of: clinical studies ($948,000), manufacturing and engineering ($246,000), quality control ($550,000) and regulatory ($207,000).

The following summarizes the most substantial of our contracts relating to research, consulting, and supply costs for AIM as they related to research and development costs for the three months ended March 31, 2024.

Amarex Clinical Research LLC

Amarex is the principal administrator of several of AIM’s largest clinical studies. AIM has multiple contracts with Amarex Clinical Research LLC (“Amarex”). During the three months ended March 31, 2024 and 2023, the Company incurred approximately $521,000 and $455,000, respectively, related to these ongoing agreements:

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Pancreatic Cancer - In April 2022, AIM executed a work order with Amarex pursuant to which Amarex is managing a Phase 2 clinical trial in locally advanced pancreatic cancer patients designated AMP-270. Per the work order, AIM anticipates that Amarex’s management of the study will cost approximately $8,400,000. This estimate includes pass-through costs of approximately $1,000,000 and excludes certain third-party and investigator costs and escalations necessary for study completion. AIM anticipates that the study will take approximately 4.6 years to complete.

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During the three months ended March 31, 2024, the Company incurred approximately $86,000 related to this agreement.

SEC Form 10-Q filed by AIM ImmunoTech Inc.