EQUITY, STOCK-BASED COMPENSATION AND EARNINGS (LOSS) PER SHARE

9 Months Ended

Jun. 30, 2025

Equity, Stock-Based Compensation, And Earnings Per Share

EQUITY, STOCK-BASED COMPENSATION AND EARNINGS (LOSS) PER SHARE

EQUITY, STOCK-BASED COMPENSATION AND LOSS PER SHARE

Authorized Shares

On November 4, 2021, the Company’s shareholders approved an amendment to the Company’s Second Amended and Restated Articles of Incorporation to increase the number of authorized shares from 20,000,000 shares, consisting of 19,000,000 common shares and 1,000,000 preferred shares, to 75,000,000 shares, consisting of 74,000,000 common shares and 1,000,000 preferred shares. Approval of this matter by the Inotiv shareholders was a condition to the closing of the Envigo RMS, LLC (“Envigo”) acquisition. The amendment was effective on November 4, 2021.

As of June 30, 2025 and September 30, 2024, no preferred shares were outstanding.

Offering

On December 18, 2024, the Company entered into the Underwriting Agreement as discussed in Note 1 - Description of the Business and Basis of Presentation, relating to the public offering of 6,000,000 common shares at a purchase price per share to the public of $4.25. Pursuant to the Underwriting Agreement, the Company granted the Underwriter a 30-day option to purchase up to an additional 900,000 common shares at the Offering Price, less underwriting discounts and commissions, which option was exercised in full and closed on December 30, 2024. Net proceeds from the offering were $27,524 after deducting the underwriting discounts and commissions and other offering expenses paid by the Company.

Warrants

The Warrants are classified as equity instruments, have an exercise price of $1.57 per share, are exercisable at any time until September 13, 2034. Refer to Note 4 - Debt for further discussion of the transactions contemplated by the Purchase Agreement and the Fee Letter. During the three months ended December 31, 2024, 1,112,126 of the Warrants were exercised on a cashless basis and exchanged for 801,013 common shares. This is included in the condensed consolidated statements of shareholders' equity and noncontrolling interest in the "Other" line for the three months ended December 31, 2024.

Stock-Based Compensation

On March 13, 2025, the Company's shareholders approved an amendment to the Inotiv, Inc. 2024 Equity Incentive Plan (the “2024 Plan”). The amendment to the 2024 Plan increased the number of shares available for issuance under the 2024 Plan by an additional 2,250,000 common shares. On March 14, 2024, the Company's shareholders approved the 2024 Plan. As originally approved, the 2024 Plan provided for the issuance of up to 1,500,000 of the Company's common shares, plus the number of common shares remaining available for future grants under the Amended and Restated 2018 Equity Incentive Plan (the “2018 Plan”) as of March 14, 2024. Any common shares subject to an award under the 2024 Plan or 2018 Plan that expires, is forfeited or cancelled, is settled for cash or exchanged will become available for future awards under the 2024 Plan. Following the shareholders' approval of the 2024 Plan, awards can no longer be granted under the 2018 Plan. The Company currently grants equity awards from the 2024 Plan. As of June 30, 2025, 914,941 shares remained available for grants under the 2024 Plan.

The Company expenses the estimated fair value of stock options, restricted stock and restricted stock units over the vesting periods of the grants. The Company recognizes expense for awards subject to graded vesting using the straight-line attribution method and forfeitures, as they are incurred. Stock based compensation expense for the three months ended June 30, 2025 and 2024, was $1,439 and $1,337, respectively. Stock based compensation expense for the nine months ended June 30, 2025 and 2024, was $4,644 and $5,118, respectively.

Loss per Share

The Company computes basic loss per share using the weighted average number of common shares outstanding. The Company computes diluted loss per share using the if-converted method for preferred shares and convertible debt, if any, and the treasury stock method for stock options and restricted stock units.

The following table reconciles the numerator and denominator in the computations of basic and diluted loss per share:


	Three Months Ended June 30,				Nine Months Ended June 30,
	2025		2024		2025		2024
Numerator:
Consolidated net loss	$	(17,577)	$	(26,087)	$	(60,073)	$	(89,994)
Less: Net loss attributable to noncontrolling interests	—		—		—		(440)
Net loss attributable to common shareholders	(17,577)		(26,087)		(60,073)		(89,554)

Denominator:
Weighted-average shares outstanding - Basic (in thousands)	34,353		25,993		31,811		25,862
Weighted-average shares outstanding - Diluted (in thousands)	34,353		25,993		31,811		25,862
Anti-dilutive common share equivalents1	10,712		5,451		10,712		5,451
1As of June 30, 2025, anti-dilutive common share equivalents are comprised of stock options, restricted stock units, 2,859,306 common shares issuable upon conversion of the Notes and 3,034,124 common shares issuable upon the exercise of the Warrants. As of June 30, 2024, anti-dilutive common share equivalents are comprised of stock options, restricted stock units, restricted stock awards and 3,040,268 shares of common stock issuable upon conversion of the Notes. These common share equivalents were outstanding for the periods presented, but were not included in the computation of diluted net loss per share for those periods because their inclusion would have had an anti-dilutive effect.

Inotiv, Inc. 10-Q