Note 8. Equity

2023 Equity Offerings and Common Warrants

On August 4, 2023, and November 9, 2023, we completed a public offering and entered into a warrant inducement agreement, respectively, resulting in the issuance of common warrants (the "2023 Common Warrants") to purchase up to an aggregate of 1,368 shares of common stock. We received aggregate net proceeds of $5.3 million, which includes non-cash warrant modification costs of $2.1 million. As of June 30, 2025, there were 38 aggregate 2023 Common Warrants outstanding with an amended exercise price between $7,586.40 per share and $20,187.20 per share and expiration dates between November 2025 and November 2028.

If the warrants issued in connection with the 2023 offerings are exercised at their current exercise prices, we will receive up to an additional $0.3 million in proceeds.

2024 Equity Offerings and Common Warrants

On April 15, 2024, we completed a public offering of common stock and warrants, in which we received gross proceeds of $4.6 million, less total issuance costs of $0.6 million, which included 4,595 shares of common stock (or pre-funded warrants in lieu thereof, all of which have been exercised as of June 30, 2025) and accompanying common warrants to purchase up to 9,190 shares of common stock at an exercise price of $999.00 per share for a combined offering price of $999.00 per share and accompanying common warrants. The common warrants were exercisable immediately following the date of issuance and will expire in April 2029. As of June 30, 2025, we have 401 common warrants outstanding with an amended exercise price of $172.00 per share and 181 common warrants outstanding with an amended exercise price of $999.00 per share that were issued in connection with the April 2024 public offering (the "April 2024 Warrants").

On July 1, 2024, we completed a registered direct offering (the "July 2024 Registered Direct Offering") in which we issued 7,216 shares of common stock (or pre-funded warrants in lieu thereof, all of which have been exercised as of June 30, 2025) and accompanying common warrants to purchase up to 14,432 shares of common stock at an exercise price of $381.20 per share for a combined offering price of $381.20 per share and accompanying common warrants. The common warrants became exercisable immediately following the date of stockholder approval on August 6, 2024, and will expire in August 2029. We received approximately $2.7 million in gross proceeds less total issuance costs of $0.8 million. Issuance costs include placement agent fees and legal fees of $0.4 million and non-cash warrant modification costs of $0.4 million. The Company recognized the $0.4 million modification date incremental value of the modified warrants as compared to the original warrants as a non-cash issuance cost of the July 2024 Registered Direct Offering. As of June 30, 2025, we have 585 common warrants outstanding at an amended exercise price of $172.00 per share that were issued in connection with the July 2024 Registered Direct Offering (the "July 2024 Warrants").

On December 12, 2024, we entered into a warrant inducement agreement (the "December 2024 Inducement Agreement") with certain holders of our 2023 Common Warrants, April 2024 Warrants, July 2024 Warrants and warrants issued on September 18, 2024 (together, the "Existing Warrants") to exercise for cash 41,177 Existing Warrants at a reduced exercise price of $150.00 per share. Additionally, pursuant to the December 2024 Inducement Agreement, we issued 82,354 common warrants (the "December 2024 Warrants," and, together with the remaining April 2024 Warrants and July 2024 Warrants, the "2024 Warrants") with an exercise price of $190.60 per share which are exercisable immediately following the date of issuance and will expire in December 2029. We received $6.2 million in gross proceeds from the exercise of these warrants less total issuance costs of $0.6 million, which includes placement agent fees and legal fees. The common warrants in connection with the December 2024 Warrant Inducement were equity classified as they are indexed to the Company's stock and do not contain any exercise contingency. The fair value of Existing Warrants immediately before and after the December 2024 Warrant Inducement were $3.5 million and $3.6 million, respectively. The fair value of the December 2024 Warrants was $7.3 million. Given the common warrants were equity classified, the modified fair value of Existing Warrants and the December 2024 Warrants to purchase common stock has been accounted for in additional paid-in capital as an equity cost because the modification was done in order to raise equity by inducing the exercise of warrants. As of June 30, 2025, there were 82,355 December 2024 Warrants outstanding with an amended exercise price of $23.80 per share.

If the warrants issued in connection with the 2024 offerings are exercised at their current exercise prices, we will receive up to an additional $2.3 million in proceeds.

2025 Equity Offerings and Common Warrants

On April 4, 2025, we completed a registered direct offering and a concurrent private placement (the “April 4, 2025 Offering”), in which we issued 88,235 shares of common stock and accompanying common warrants to purchase up to an aggregate of 176,470 shares of common stock at an exercise price of $23.80 per share for a combined offering price of $23.80 per share and accompanying common warrants. The common warrants became immediately exercisable following the date of stockholder approval on May 14, 2025 and will expire in May 2030. We received $2.1 million in gross proceeds less total issuance costs of $0.2 million. In connection with the April 4, 2025 Offering, we also agreed to amend certain existing warrants that were previously issued on December 12, 2024 to purchase up to 82,355 shares of common stock and had an exercise price of $190.60 per share, and reduced the exercise price of these warrants to $23.80 per share. The Company recognized the $0.6 million modification date incremental value of the modified warrants as compared to the original warrants as a non-cash issuance cost of the April 4, 2025 Offering. Given the common warrants were equity classified, the modified fair value of existing common warrants to purchase common stock has been accounted for in additional paid-in capital as an equity cost because the modification was done in order to raise equity in conjunction with the April 4, 2025 Offering. As of June 30, 2025, we have 176,473 common warrants outstanding in connection with the April 4, 2025 Offering.

On April 22, 2025, we completed a registered direct offering (the “April 22, 2025 Offering” and together with the April 4, 2025 Offering, the “April 2025 Offerings”), in which we issued 116,200 shares of common stock at a purchase price of $17.24 per share. We received $2.0 million in gross proceeds less total issuance costs of $0.2 million. We did not issue any common warrants in connection with the April 22, 2025 Offering.

On June 20, 2025, we completed an offering priced at-the-market (the “June 2025 Offering”) with certain institutional investors, in which we received gross proceeds $8.0 million, which included 2,465,000 shares of common stock (or pre-funded warrants in lieu thereof, all of which have been exercised as of June 30, 2025) and accompanying common warrants to purchase up to 12,325,000 shares of common stock at an exercise price of $3.25 per share for a combined purchase price of $3.25 per share and accompanying common warrants. The common warrants became immediately exercisable following the date of stockholder approval on July 24, 2025 and will expire in July 2030. We received $8.0 million in gross proceeds less total issuance costs of $0.7 million. Additionally, the common warrants issued in our June 2025 Offering include a down-round feature. As of June 30, 2025, we have 12,325,000 common warrants outstanding in connection with the June 2025 Offering.

If the warrants issued in connection with the 2025 offerings are exercised at their current exercise price, we will receive up to an additional $44.3 million in proceeds.

Aptevo uses Black-Scholes valuation model for estimating the fair value of the common warrants included in public and direct offerings. The warrants are classified as an equity instrument because they are both indexed to the Company's own stock and classified in stockholders' equity, are recorded at fair value on the date of issuance. For the six months ended June 30, 2025 the valuation assumptions for warrants issued were estimated on the measurement date using the Black-Scholes option-pricing model with the following weighted-average assumptions:

Standby Equity Purchase Agreement

On June 16, 2025, we entered into a Standby Equity Purchase Agreement (the “SEPA”) with YA II PN, LTD., a Cayman Islands exempt limited company (“Yorkville”). Pursuant to the SEPA, the Company has the right, but not the obligation, to issue and sell to

Yorkville from time to time up to $25.0 million (the “Commitment Amount”) of the Company’s common stock during the 36 months following the execution of the SEPA, subject to market conditions, restrictions, and satisfaction of the conditions in the SEPA. As consideration for Yorkville’s irrevocable commitment to purchase the shares of common stock up to the Commitment Amount, the Company paid a structuring fee in the amount of $25,000 to Yorkville, and the Company has agreed to pay a commitment fee to Yorkville in an amount equal to 2.00% of the Commitment Amount in five equal installments. We accounted for the structuring and the commitment fee as deferred issuance cost. We did not issue any shares under the SEPA in the six months ended June 30, 2025 and 2024.

At The Market Offering Agreement

On April 28, 2025, we entered into an At The Market Offering Agreement (the “ATM Agreement”) with Roth Capital Partners, LLC, as sales agent (“Roth”) for an aggregate offering price of $50.0 million, pursuant to which we may offer and sell shares of our common stock from time to time through Roth. The compensation to Roth for the shares sold pursuant to the ATM Agreement will be an amount equal to 3.0% of the gross sales price of the shares sold under the ATM Agreement. The sale of such shares of common stock by Roth will be effected under the Company’s existing shelf Registration Statement on Form S-3, which was declared effective on February 26, 2025 (the “Registration Statement”). For the six months ended June 30, 2025, we issued 481,829 shares of our common stock at an average price of $7.81 per share under the ATM Agreement. We received $3.8 million in proceeds from the issuance of these shares. We did not issue any shares under the ATM Agreement in the six months ended June 30, 2024. On June 20, 2025, we filed the latest amendment to the prospectus supplement to our Registration Statement on Form S-3 filed on February 14, 2025 pursuant to General Instruction I.B.6 of Form S-3 (General Instruction I.B.6), which updates the amount of shares that we are eligible to sell under the ATM Agreement to an aggregate of $8.0 million.

Rights Plan

On November 8, 2020, our Board of Directors (the "Board") approved and adopted a Rights Agreement (the "Rights Agreement"), dated as of November 8, 2020, by and between the Company and Broadridge Corporate Issuer Solutions, Inc., as rights agent, pursuant to which the Board declared a dividend of one preferred share purchase right (each, a "Right") for each outstanding share of the Company’s common stock held by stockholders as of the close of business on November 23, 2020. One Right also will be issued together with each Common Share issued by the Company after November 23, 2020, but before the Distribution Date (as defined below) (or the earlier redemption or expiration of the Rights) and, in certain circumstances, after the Distribution Date. When exercisable, each Right initially would represent the right to purchase from the Company one one-thousandth of a share of a newly-designated series of preferred stock, Series A Junior Participating Preferred Stock, par value $0.001 per share, of the Company. Subject to various exceptions, the Rights become exercisable in the event any person (excluding certain exempted or grandfathered persons) becomes the beneficial owner of ten percent (10%) or more of the Company’s common stock without the approval of the Board. On November 4, 2024, we entered into Amendment No. 4 to the Rights Agreement and extended the expiration of such agreement to October 31, 2025, and changed the exercise price to $70 per one one-thousandth of a Series A Junior Participating Preferred Share, subject to adjustment. We have evaluated the rights agreement and determined that it does not represent a derivative or a liability.

2018 Stock Incentive Plan

On June 1, 2018, at the 2018 Annual Meeting of the Stockholders, the Company’s stockholders approved a new 2018 Stock Incentive Plan (the "2018 SIP"), which replaced the Restated 2016 Plan on a go-forward basis. All stock options, RSUs or other equity awards granted subsequent to June 1, 2018 have been and will be issued out of the 2018 SIP, which has 250,160 shares of Aptevo common stock authorized for issuance. The 2018 Plan became effective immediately upon stockholder approval at the 2018 Annual Meeting of the Stockholders.

On July 24, 2025, at the 2025 annual meeting of the stockholders, our stockholders approved the Third Amended and Restated 2018 SIP (the "Third Amended 2018 SIP") to increase the number of shares authorized for issuance under the Amended 2018 SIP by 250,000 shares of common stock. As of June 30, 2025, there are 250,160 shares available to be granted under the Third Amended 2018 SIP.

Stock options and RSUs under the Third Amended 2018 SIP generally vest pro rata over a one-year or three-year period. Stock options terminate ten years from the grant date, though the specific terms of each grant are determined individually. The Company’s executive officers, members of our Board, and certain other employees and consultants may be awarded options and/or RSUs with different vesting criteria, and awards granted to non-employee directors will vest over a one-year period. Option exercise and RSU grant prices for new awards granted by the Company equal the closing price of the Company’s common stock on the Nasdaq Capital Market on the date of grant.

Stock-Based Compensation Expense

Stock-based compensation expense includes amortization of stock options and RSUs granted to employees and non-employees and has been reported in our unaudited condensed consolidated statements of operations as $0.02 million and $1.0 million for the six months ended June 30, 2025 and 2024, respectively.

The Company accounts for stock-based compensation by measuring the cost of employee services received in exchange for all equity awards granted based on the fair value of the award as of the grant date. The Company recognizes the compensation expense over the vesting period. All assumptions used to calculate the grant date fair value of non-employee equity awards are generally consistent with the assumptions used for equity awards granted to employees. In the event the Company terminates any of its consulting agreements, the unvested equity underlying the agreements would also be forfeited.

Stock Options

Aptevo utilizes the Black-Scholes valuation model for estimating the fair value of all stock options granted. The Company did not grant stock options for the three and six months ended June 30, 2025, or for the three and six months ended June 30, 2024

As of June 30, 2025, we had $0.04 million of unrecognized compensation expense related to options expected to vest over a weighted-average remaining vesting period of 0.7 years. The aggregate intrinsic value of options exercised for the three months ended June 30, 2025 and 2024 was $0. The total fair value of stock options vested for the six months ended June 30, 2025 and 2024 was $0 million and $1.00 million, respectively.

The aggregate intrinsic value is the total pretax intrinsic value (the difference between the closing stock price of Aptevo’s common stock on the last trading day of June 30, 2025 and the exercise price, multiplied by the number of in the money options) that would have been received by the option holders had all the option holders exercised their options on the last trading day of the quarter.

Restricted Stock Units

As of June 30, 2025, there was $0.1 million unrecognized stock-based compensation expense related to unvested RSUs expected to vest over the weighted-average period of 1.2 years.

The fair value of each RSU has been determined to be the closing trading price of the Company’s common stock on the date of grant as quoted on the Nasdaq Capital Market.