Lifevantage Corp

Note 1 —The Company

LifeVantage Corporation (the “Company” or “we” or “our” or “us”) is a company focused on nutrigenomics, the study of how nutrition and naturally occurring compounds affect human genes to support good health. The Company is dedicated to helping people achieve their health, wellness, and financial goals. The Company provides quality, scientifically validated products to customers and independent consultants as well as a financially rewarding commission-based direct sales opportunity to its independent consultants. LifeVantage sells its products in the United States, Mexico, Japan, Australia, Hong Kong, Canada, Thailand, the United Kingdom, the Netherlands, Germany, Taiwan, Austria, Spain, Ireland, Belgium, New Zealand, and Singapore. On June 30, 2025, the Company ceased operations in the Philippines and closed that market.

The Company engages in the identification, research, development, formulation and sale of advanced nutrigenomic activators, dietary supplements, weight management products, pre- and pro-biotics, skin and hair care products and nootropics. The Company’s line of scientifically validated dietary supplements includes its flagship Protandim®family of products, its LifeVantage® line of dietary supplements that include the MindBody GLP-1 System™, Omega+, ProBio, IC Bright®, the Rise AM & Reset PM System®, D3+, and Daily Wellness, and PhysIQ™ Fat Burn and Prebiotic dietary supplements. TrueScience®is the Company’s line of skin and hair care products and Liquid Collagen. The Company also markets and sells Petandim®, its companion pet supplement formulated to combat oxidative stress in dogs; and AXIO®, its nootropic energy drink mixes.

The Company was incorporated in Colorado in June 1988 under the name Andraplex Corporation. The Company changed its corporate name to Yaak River Resources, Inc. in January 1992, and subsequently changed it again in October 2004 to Lifeline Therapeutics, Inc. In October 2004 and March 2005, the Company acquired all of the outstanding common stock of Lifeline Nutraceuticals Corporation. In November 2006, the Company changed its name to LifeVantage Corporation.

In March 2018, the Company reincorporated from the state of Colorado to the state of Delaware. All outstanding shares of common stock, options and share units of the Colorado corporation were converted into an equivalent share, option or share unit of the Delaware corporation and the par value of the Company’s common stock was adjusted to $0.0001.

Note 2 —Summary of Significant Accounting Policies

Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation.

Use of Estimates

The Company prepares the consolidated financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America (“GAAP”). In preparing these statements, the Company is required to use estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from those estimates and assumptions. On an ongoing basis, the Company reviews its estimates, including, but not limited to, those related to inventory valuation and obsolescence, sales returns, income taxes and tax valuation reserves, transfer pricing methodology and positions, impairment of assets, stock-based compensation, and loss contingencies.

Foreign Currency Translation

A portion of the Company’s business operations occurs outside the United States. The local currency of each of the Company’s subsidiaries generally is its functional currency. All assets and liabilities are translated into U.S. Dollars at exchange rates existing at the balance sheet dates, revenue and expenses are translated at weighted-average exchange rates and stockholders’ equity is recorded at historical exchange rates. The resulting foreign currency translation adjustments are recorded as a separate component of stockholders’ equity in the consolidated balance sheets and as a component of comprehensive income. Transaction gains and losses are included in other expense, net in the consolidated statements of operations and comprehensive income.

Fair Value of Financial Instruments

The Company accounts for assets and liabilities using a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs have created the fair-value hierarchy below. This hierarchy requires the Company to minimize the use of unobservable inputs and to use observable market data, if available, when determining fair value.

•Level 1—Quoted prices for identical instruments in active markets;

•Level 2—Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and

•Level 3—Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

Our financial instruments, consisting primarily of cash and cash equivalents, accounts receivable, and accounts payable, approximate fair value due to their short-term nature.

Cash and Cash Equivalents

The Company considers only its monetary liquid assets with original maturities of three months or less to be cash equivalents.

Accounts Receivable

The Company’s accounts receivable for the fiscal years ended June 30, 2025 and 2024 consist primarily of credit card receivables. Based on the Company’s verification process for customer credit cards and historical information available, management has determined that an allowance for doubtful accounts on credit card sales related to its customer sales as of June 30, 2025 or 2024 is not necessary. There wasno bad debt expense for the fiscal years ended June 30, 2025 and 2024.

Inventory

Inventory consisted of (in thousands):

Inventories are carried at the lower of cost or net realizable value, using the first-in, first-out method, which includes a reduction in inventory values of$0.5 million and $1.3 million at June 30, 2025 and 2024, respectively, related to obsolete and slow-moving inventory.

Reserves of inventories consist of the following (in thousands):

Property and Equipment

Property and equipment are recorded at cost and depreciated using the straight-line method over the following useful lives:

Leasehold improvements are depreciated over the shorter of estimated useful life of the related asset or the lease term.

The cost of normal maintenance and repairs is charged to expense as incurred. When an asset is sold or otherwise disposed of, the cost and associated accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized in the consolidated statements of operations and comprehensive income in other expense, net. Significant expenditures that increase the useful life of an asset are capitalized and depreciated over the estimated useful life of the asset. Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.

Intangible Assets

Intangible assets are stated at cost less accumulated amortization. Finite-lived intangible assets are amortized over their related useful lives, using a straight-line method, consistent with the underlying expected future cash flows related to the specific intangible asset. Finite-lived intangible assets are reviewed for impairment whenever events or changes in circumstances exist that indicate the carrying amount of an asset may not be recoverable. When indicators of impairment exist, an estimate of undiscounted net cash flows is used in measuring whether the carrying amount of the asset or related asset group is recoverable. Measurement of the amount of impairment, if any, is based upon the difference between the asset’s carrying value and estimated fair value.

Indefinite-lived intangible assets are not amortized; however, they are tested at least annually for impairment or more frequently if events or changes in circumstances exist that may indicate impairment. An impairment loss is recognized if the carrying amount of the asset exceeds its fair value. Annual impairment tests on intangible assets were completed for the fiscal years ended June 30, 2025 and 2024, resulting inno impairment charges.

Impairment of Long-Lived Assets

Pursuant to guidance established for impairment or disposal of assets, the Company assesses impairment whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. When an assessment for impairment of long-lived assets, long-lived assets to be disposed of, and certain identifiable intangibles related to those assets is performed, the Company is required to compare the net carrying value of long-lived assets on the lowest level at which cash flows can be determined on a consistent basis to the related estimates of future undiscounted net cash flows for such assets. If the net carrying value exceeds the net cash flows, then an impairment is recognized to reduce the carrying value to the estimated fair value, generally equal to the future discounted net cash flow. For the fiscal years ended June 30, 2025 and 2024, management has concluded that there are no indications of impairment.

Concentration of Credit Risk

Accounting guidance for financial instruments requires disclosure of significant concentrations of credit risk regardless of the degree of such risk. Financial instruments with significant credit risk include cash and cash equivalents. At June 30, 2025, the Company had $17.0 million in cash and cash equivalent accounts at one financial institution and $3.2 million in other financial institutions. As of June 30, 2025 and 2024, and during the years then ended, the Company’s cash balances exceeded federally insured limits.

Commissions and Incentives

Commissions and incentives expenses are the Company’s most significant expenses and are classified as operating expenses. Commissions and incentives expenses include sales commissions paid to the Company’s independent consultants, special incentives, costs for incentive trips and other rewards. Commissions and incentives expenses do not include any amounts the Company pays to its independent consultants for personal purchases. Commissions paid to independent consultants on personal purchases are considered a sales discount and are reported as a reduction to net revenue.

Shipping and Handling

Shipping and handling costs associated with inbound freight and freight out to customers, including independent consultants, are included in cost of sales. Shipping and handling fees charged to all customers are included in sales.

Research and Development Costs

The Company expenses all costs related to research and development activities as incurred. Research and development expenses for the fiscal years ended June 30, 2025 and 2024 were$1.4 million and $0.7 million, respectively.

Leases

The Company accounts for leases in accordance with Accounting Standards Codification (“ASC”) 842. The Company reviews all contracts and determines if the arrangement is or contains a lease, at inception. Operating leases are included in right-of-use (“ROU”) assets, current lease liabilities and long-term lease liabilities on the consolidated balance sheets. The Company doesnot have any finance leases.

Operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The Company uses its estimated incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. The operating lease ROU asset also includes any upfront lease payments made and excludes lease incentives and initial direct costs incurred. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Leases with a term of 12 months or less are not recorded on the balance sheet. The Company’s lease agreements do not contain any residual value guarantees.

The Company recognizes stock-based compensation by measuring the cost of services to be rendered based on the grant date fair value of the equity award. The Company recognizes stock-based compensation, net of any estimated forfeitures, over the period an employee is required to provide service in exchange for the award, generally referred to as the requisite service period. The Company estimates forfeitures based on historical information and other management assumptions.

The Black-Scholes option pricing model is used to estimate the fair value of stock options and options under the Company’s 2019 Employee Stock Purchase Plan. The determination of the fair value of options is affected by the Company’s stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends. The Company uses historical data for estimating the expected volatility and expected life of stock options required in the Black-Scholes model. The risk-free interest rate assumption is based on observed interest rates appropriate for the expected terms of the stock options.

The fair value of restricted stock grants, including performance restricted stock units that include non-market based performance conditions, is based on the closing market price of the Company’s stock on the date of grant less the Company’s expected dividend yield. The Company recognizes compensation costs for awards with performance conditions when it concludes it is probable that the performance conditions will be achieved. The Company reassesses the probability of vesting at each balance sheet date and adjusts compensation costs accordingly.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using statutory tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled, updated as needed for changes in corporate tax rates. The effect on deferred tax assets and liabilities from a change in tax rates is recognized in income in the period that includes the effective date of the change. The Company recognizes tax liabilities or benefits from an uncertain position only if it is more likely than not that the position will be sustained upon examination by taxing authorities based on the technical merits of the issue. The amount recognized would be the largest liability or benefit that the Company believes has greater than a 50% likelihood of being realized upon settlement.

Income Per Share

Basic income per common share is computed by dividing net income by the weighted-average number of common shares outstanding during the period, less unvested restricted stock awards. Diluted income per common share is computed by dividing net income by the weighted-average common shares and potentially dilutive common share equivalents using the treasury stock method.

For the fiscal years ended June 30, 2025 and 2024, the effects of approximately 30,000 and 13,000 common shares, respectively, issuable upon exercise of options and non-vested shares of restricted stock, are not included in the computations as their effect was anti-dilutive.

The following is a reconciliation of net income per share and the weighted-average common shares outstanding for purposes of computing basic and diluted net income per share (in thousands, except per share amounts):

New Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07), expanding segment disclosure requirements. The amendments require enhanced disclosure for certain segment items and required disclosure on how management uses reported measures to assess segment performance. The amendments do not change how segments are determined, aggregated, or how thresholds are applied to determine reportable segments. ASU 2023-07 is effective for the Company’s annual periods beginning July 1, 2024, and for interim periods beginning July 1, 2025, with early adoption permitted. The Company adopted ASU 2023-07 for the fiscal year beginning July 1, 2024. See Note 13 for expanded segment disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). The guidance requires disclosure of disaggregated income taxes paid, prescribes standardized categories for the components of the effective tax rate reconciliation, and modifies other income tax-related disclosures. ASU 2023-09 is effective for the Company’s annual periods beginning July 1, 2025, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”). The guidance requires disclosure of specified information about certain costs and expenses at each interim and annual reporting period. ASU 2024-03 is effective for the Company’s annual periods beginning July 1, 2027, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures.

Other recently issued accounting pronouncements did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

Note 3 —Revenue

Revenue is recognized when control of the promised goods or services are transferred to the customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Sales, value add, and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue.

The Company generates the majority of its revenue through product sales to customers. These products include the Protandim®line of dietary supplements, the LifeVantage® line of dietary supplements that include the MindBody GLP-1 System™, Omega+, ProBio, IC Bright®, the Rise AM & Reset PM System®, D3+, and Daily Wellness, PhysIQ™ Fat Burn and Prebiotic dietary supplements, TrueScience® skin and hair care products and Liquid Collagen, Petandim®, our companion pet supplement formulated to combat oxidative stress in dogs, and AXIO® nootropic energy drink mixes. The Company ships most of its product directly to the consumer and receives substantially all payment for product sales in the form of credit card receipts. Revenue from direct product sales to customers is recognized upon shipment, which is when passage of title and risk of loss occurs. For items sold in packs and bundles, the Company determines the standalone selling price at contract inception for each distinct good and then allocates the transaction price on a relative standalone selling price basis. Any discounts are accounted for as a direct reduction to the transaction price. Shipping and handling revenue is recognized upon shipment when the performance obligation is completed.

The Company also charges amounts to independent consultants to attend events that it holds. Tickets to events are sold as standalone items or included within packs. For event tickets sold in packs, the Company allocates a portion of the transaction price to the ticket on a relative standalone selling price basis, adjusted for the probability of the tickets being redeemed for attendance at a future event. Any discounts are accounted for as a direct reduction to the transaction price. Fee revenue associated with ticket sales is recorded in the month that the event is held, which is when the Company has performed its obligations under the contract.

Deferred Revenue

The Company launched its Rewards Circle loyalty program in the United States, Australia, New Zealand, and Japan in March 2023 and in Canada, Europe, and Mexico in February 2024. Contract liabilities, recorded as deferred revenue, include these loyalty program credit deferrals with certain customers which are accounted for as a reduction in the transaction price and are generally recognized as credits are redeemed for additional products at a later date.

The Company also records deferred revenue when cash payments are received or due in advance of performance, including amounts which are refundable. The Company pre-sells tickets to its events. When cash payments are received in advance of events, the cash received is recorded to deferred revenue until the event is held, at which time the Company has performed its obligations under the contract and the revenue is recognized.

Deferred revenue is included in accrued expenses in the consolidated balance sheets. The balance of deferred revenue related to contract liabilities, each less than twelve months, was $0.7 million and $0.9 million as of June 30, 2025 and 2024, respectively. The contract liabilities impact to revenue for the years ended June 30, 2025 and 2024 was an increase of $0.2 million and a decrease of $26,000, respectively.

Sales Returns and Allowances

Estimated returns are recorded when product is shipped. Subject to some exceptions based on local regulations, the Company’s return policy is to provide a full refund for product returned within 30 days. After 30 days of purchase, only unopened product that is in a resalable and restockable condition may be returned within twelve months of purchase and shall receive a 100% refund, less a 10% handling and restocking fee and any shipping and handling costs. The Company establishes a refund liability reserve, and an asset reserve for its right to recover products, based on historical experience. The returns asset reserve and returns liability reserve are evaluated on a quarterly basis. As of June 30, 2025 and 2024, the Company’s return liability reserve, net was$0.2 millionand $0.1 million, respectively.

Reserves for sales returns consist of the following (in thousands):

Note 4 —Property and Equipment, Net

Property and equipment, net consist of (in thousands):

Depreciation expense totaled$3.1 million and $3.4 million for the fiscal years ended June 30, 2025 and 2024, respectively.

Note 5 —Intangible Assets, Net

Intangible assets, net consist of (in thousands):

During the fiscal year ended June 30, 2025, the patents included in intangible assets related to Protandim® Nrf2 Synergizer® reached expiration and entered the public domain. Amortization expense totaled$0.1 million and $0.1 million for the fiscal years ended June 30, 2025 and 2024, respectively. As of June 30, 2025, the remaining weighted-average amortization period for finite-lived intangible assets iszero years. There isno annual estimated amortization expense expected in the succeeding fiscal year.

Note 6 —Other Accrued Expenses

Other accrued expenses consist of (in thousands):

Note 7 —Long-Term Debt

On March 30, 2016, the Company entered into a loan agreement (the “2016 Loan Agreement”) and a security agreement (the “2016 Security Agreement”). The 2016 Loan Agreement provides for a term loan in an aggregate principal amount of $10.0 million(the “2016 Term Loan”) and a revolving loan facility in an aggregate principal amount not to exceed $2.0 million (the “2016 Revolving Loan,” and collectively with the 2016 Term Loan, the 2016 Loan Agreement, and the 2016 Security Agreement, and together with the amendments described below, the “2016 Credit Facility”). The 2016 Credit Facility was subsequently amended, among other things, to increase the available borrowing under the revolving loan facility to $5.0 million. On March 31, 2024, the 2016 Credit Facility reached the maturity date and was terminated. As of March 31, 2024, there wasno balance outstanding under the 2016 Credit Facility.

On April 12, 2024, the Company entered into a Loan Agreement (the “Loan Agreement”) with Bank of America, N.A., as Lender (the “Lender”). In connection with the Loan Agreement and on the same date, the Company, Lifeline Nutraceuticals Corporation, as Guarantor (the “Guarantor”), and the Lender also entered into a Continuing and Unconditional Guaranty (the “Continuing and Unconditional Guaranty”) and a Security and Pledge Agreement (the “Security and Pledge Agreement”). The Loan Agreement provides for a revolving line of credit in an aggregate principal amount not to exceed $5.0 million (the “Line of Credit” and collectively with the Loan Agreement, Continuing and Unconditional Guaranty, and the Security and Pledge Agreement, the “2024 Credit Facility”).

In the event the Company borrows under the Line of Credit, interest will be payable commencing May 31, 2024, and then on the last day of each month thereafter until payment in full of all principal outstanding under the Line of Credit, with all unpaid principal and interest due on April 12, 2027 (the “Expiration Date”). The Line of Credit will bear interest at a rate per year equal to the sum of (i) the greater of the Term SOFR Daily Floating Rate (as defined in the Loan Agreement) or 0.00%, plus (ii)2.00%. Amounts under the Line of Credit may be repaid and re-borrowed from time to time until the Expiration Date. As of June 30, 2025, the effective interest rate is 6.45%.

The Company’s obligations under the Loan Agreement are secured by a security interest in substantially all of the assets of the Company and the Guarantor, and by a pledge of the membership interests of the Company’s subsidiaries, as further provided for in the Security and Pledge Agreement. Pursuant to the Continuing and Unconditional Guaranty, the Guarantor guarantees and promises to pay promptly to the Lender all indebtedness of the Company when due.

The Loan Agreement contains customary covenants, both affirmative and negative, that, among other things, restrict the Company’s ability to deal with the Company’s assets outside of the ordinary course, incur additional indebtedness, grant liens on the Company's assets, make certain investments, purchase or otherwise acquire all or substantially all the assets or equity interests of other companies, and enter into consolidations, mergers or other combinations. The Loan Agreement requires that the Company maintain specified financial ratios and satisfy certain financial condition tests.

The Loan Agreement contains certain customary events of default, including, among other things, failure of the Company to make required payments under the Loan Agreement, certain breaches of representations made by the Company or the Guarantor, insolvency or bankruptcy of the Company or the Guarantor, failure to have an enforceable first lien or security interest in any property given as security for the Loan Agreement, or failure of the Company to comply with covenants set forth in the Loan Agreement. If an event of default occurs under the Loan Agreement, the obligation of the Lender to make any additional credit available to the Company may be terminated and the amounts outstanding may become immediately due and payable in the discretion of the Lender, provided that in the event of insolvency or bankruptcy of the Company or the Guarantor, all debts outstanding under the Loan Agreement will automatically become due and payable. Upon the occurrence of any default or after maturity, all amounts outstanding under the Loan Agreement will, at the option of the Lender, bear interest at a rate which is 2.00% higher than the rate of interest otherwise provided under the Loan Agreement.

As of June 30, 2025, the Company was in compliance with its financial covenants under the 2024 Credit Facility. As of June 30, 2025, there was no balance outstanding on the 2024 Credit Facility.

Note 8 —Stockholders’ Equity

During the fiscal years ended June 30, 2025 and 2024, the Company issued zero shares of common stock as a result of the exercise of options. During the fiscal years ended June 30, 2025 and 2024, the Company issued 0.4 million and 1.0 million shares, respectively, under the Company’s equity incentive plans. During the fiscal years ended June 30, 2025 and 2024,0.2 million and 0.2 million shares, respectively, of restricted stock were canceled or surrendered as payment of tax withholding upon vesting. During the fiscal years ended June 30, 2025 and 2024, the Company sold 44,000 and 0.1 million shares under its 2019 Employee Stock Purchase Plan, respectively.

On November 27, 2017, the Company’s board approved a stock repurchase program, which was subsequently amended on February 1, 2019. Under the currently approved stock repurchase program, the Company is authorized to purchase up to $60 million through December 31, 2026. The stock repurchase program permits the Company to purchase shares from time to time through a variety of methods, including in the open market, through privately negotiated transactions or other means as determined by the Company’s management, in accordance with applicable securities laws. As part of the stock repurchase program, the Company may enter into a pre-arranged stock repurchase plan which operates in accordance with guidelines specified under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. Accordingly, any transactions under such stock repurchase plan would be completed in accordance with the terms of the plan, including specified price, volume, and timing conditions. The stock repurchase program may be suspended or discontinued at any time. During the year ended June 30, 2025, the Company purchased 0.3 million shares of its common stock at an aggregate purchase price of $3.1 million under this repurchase program. During the fiscal year ended June 30, 2024, the Company purchased 1.0 million shares of its common stock at an aggregate purchase price of $6.4 million under this repurchase program. At June 30, 2025, there is $17.3 million remaining under this stock repurchase program.

On August 30, 2023, the board approved a stockholder rights agreement (the “Rights Plan”) and declared a dividend ofone right for each outstanding share of common stock to stockholders of record on September 11, 2023. Each right entitled holders to purchaseone newly issued share of preferred stock at an exercise price of $20 per right, subject to adjustment. Initially, the rights were not exercisable and traded with shares of the Company’s common stock.

In general, the rights became exercisable following a public announcement that a person had acquired 12% (or, in the case of passive investors,20%) or more of the outstanding shares of the Company’s common stock. If a person became an acquiring person, each holder of rights (except the acquiring person) would have the right to purchase, for the purchase price, a number of shares of the Company’s common stock at a 50% discount to the then-current trading price. Rather than allowing the rights to be exercised in those circumstances, the board had the right to exchange each right, other than the rights owned by the acquiring person, for a share of the Company’s common stock. The agreement provided for exceptions and additional terms for other certain situations and circumstances.

The Rights Plan was intended to protect the interests of the Company and its stockholders by reducing the likelihood that any entity, person or group gains control of the Company through open-market accumulation or other means without payment of an adequate control premium and expired on August 28, 2024. There was no impact to the Company’s Consolidated Financial Statements.

The Company’s Certificate of Incorporation authorizes the designation and issuance of shares of preferred stock. However, as of June 30, 2025, no shares of preferred stock have been designated by the Board nor are any shares of preferred stock outstanding.

Dividends

The Company paid quarterly cash dividends of $0.04 per share of common stock to stockholders of record in September 2024, December 2024 and March 2025, and$0.045 per share of common stock to stockholders of record in June 2025 which were in the aggregate amount of$2.1 million, or $0.165 per share of common stock for the fiscal year ended June 30, 2025. The Company paid a one-time cash dividend of $0.40 per share of common stock to stockholders of record in September 2023, quarterly cash dividends of $0.035 per share of common stock to stockholders of record in September 2023, December 2023 and March 2024, and $0.04 per share of common stock to stockholders of record in June 2024 which were in the aggregate amount of$6.9 million, or$0.545 per share of common stock for the fiscal year ended June 30, 2024.

The declaration of dividends is subject to the discretion of the board and will depend upon various factors, including the Company’s earnings, financial condition, restrictions imposed by any indebtedness that may be outstanding, cash requirements, future prospects, and other factors deemed relevant by the board.

Note 9 —Stock-Based Compensation

Long-Term Incentive Plans

Equity-Settled Plans

The Company adopted, and the stockholders approved, the 2017 Long-Term Incentive Plan (the “2017 Plan”), effective February 16, 2017, to provide incentives to eligible employees, directors, and consultants. The initial share pool approved was 650,000 shares. On November 9, 2023, the stockholders approved amendments to the 2017 Plan to increase the number of shares of the Company’s common stock that are available for issuance under the 2017 plan by 1,138,000 shares. As of June 30, 2025, a maximum of 5,105,000 shares of the Company’s common stock can be issued under the 2017 Plan in connection with the grant of awards which is calculated as the sum of (i)4,630,000 shares and (ii) up to 475,000 shares previously reserved for issuance under the Company’s prior 2010 Long Term Incentive Plan, including shares returned upon cancellation, termination or forfeiture of awards that were previously granted under that plan. Outstanding stock options awarded under the 2017 Plan have exercise prices of $4.44 per share, vest over athree year vesting period, and have a contractual term often years. Awards expire in accordance with the terms of each award and, upon expiration of the award, the shares subject to the award are added back to the 2017 Plan. As of June 30, 2025, under the 2017 Plan, there were stock option awards outstanding, net of awards expired, for an aggregate of 0.1 million shares of the Company’s common stock.

Employee Stock Purchase Plan

General. The Company’s 2019 Employee Stock Purchase Plan (“ESPP”) was adopted by the board in September 2018 and the Company’s stockholders approved it in November 2018. In August 2024, the board approved an amendment to the ESPP to increase the share reserve thereunder by 0.4 million shares, which amendment and increase was approved by the Company’s stockholders in November 2024. The ESPP is intended to qualify under Section 423 of the Internal Revenue Code.

Share Reserve. The Company has reserved 0.8 million shares of its common stock for issuance under the ESPP. As of June 30, 2025,0.4 million shares were available for issuance. The number of shares reserved under the ESPP will automatically be adjusted in the event of a stock split, stock dividend or a reverse stock split (including an adjustment to the per-purchase period share limit).

Purchase Price. Employees may purchase each share of common stock under the ESPP at a price equal to 85% of the lower of the fair market values of the stock as of the beginning or the end of the six-month offering periods. An employee’s contributions to the ESPP are limited to 15% of the compensation, and up to a maximum of 3,000 shares may be purchased by an employee during any offering period. A participant shall not be granted an option under the ESPP if such option would permit the participant’s rights to purchase stock to accrue at a rate exceeding $25,000 fair market value of stock for each calendar year in which such option is outstanding at any time.

Offering Periods. Unless otherwise determined by the compensation committee, the ESPP will be operated through a series of successivesix-month offering periods, which will begin each year on March 1 and September 1.

During the fiscal years ended June 30, 2025 and 2024,44,000 and 0.1 million shares of common stock were purchased under the ESPP, respectively.

In accordance with accounting guidance for stock-based compensation, payments in equity instruments for goods or services are accounted for by the fair value method. For the fiscal year ended June 30, 2025 and 2024, stock-based compensation of $5.7 million and $3.3 million, respectively, was reflected as an increase to additional paid in capital.

At June 30, 2025, there was $3.5 million of unrecognized compensation cost related to non-vested stock-based compensation arrangements under the 2017 Plan, based on management’s estimate of the shares that will ultimately vest. The Company expects to recognize such costs over a weighted-average period of 1.43 years.

Stock Options

There wereno stock option grants during the fiscal years ended June 30, 2025 and 2024.

The following is a summary of stock option activity for the fiscal years ended June 30, 2025 and 2024:

Restricted Stock Awards

The following is a summary of restricted stock award activity during the fiscal years ended June 30, 2025 and 2024:

The total vesting date fair value of restricted shares that vested during the fiscal years ended June 30, 2025 and 2024 was $4.4 million and $0.7 million, respectively.

Restricted Stock Units

The following is a summary of restricted stock units activity during the fiscal years ended June 30, 2025 and 2024:

The total vesting date fair value of restricted stock units that vested during the fiscal years ended June 30, 2025 and 2024 was $2.6 million and $1.9 million, respectively.

Performance Restricted Stock Units

During the fiscal years ended June 30, 2025 and 2024 , the Company awarded performance restricted stock units (the “FY 2025 PRSUs” and “FY 2024 PRSUs,” respectively) to certain employees (the “Recipients”). Each performance restricted stock unit represents a contingent right for the Recipients to receive a distribution of shares of common stock of the Company equal to 0% to 200% of the target number of performance restricted stock units subject to the award. The actual number of shares distributed will be based on the Company’s achievement of specified financial performance metrics. For FY 2025 PRSUs, the performance period for 50% of the FY 2025 PRSUs ended on June 30, 2025, the performance period for 30% of the FY 2025 PRSUs ends on June 30, 2026, and the performance period for the remaining 20% of the FY 2025 PRSUs ends on June 30, 2027. For FY 2024 PRSUs, the performance period for 50% of the FY 2024 PRSUs ended on June 30, 2024, the performance period for 30% of the FY 2024 PRSUs ended on June 30, 2025, and the performance period for the remaining 20% of the FY

2024 PRSUs ends on June 30, 2026. The financial performance metrics for the fiscal year ended June 30, 2025, were deemed achieved at the 200.00% achievement level. The financial performance metrics for the fiscal year ended June 30, 2024, were deemed achieved at the 0% achievement level. The FY 2025 PRSUs and FY 2024 PRSUs will vest only to the extent the specified financial performance criteria are achieved and subject to the Recipient’s continued service with the Company, as follows: (i) a portion of the earned award will vest on the first anniversary of the grant date and (ii) an additional portion of the earned award will vest thereafter in a series of quarterly installments. The fair values of the performance restricted stock units are based on the grant date fair value which is the closing price of the Company's common stock on the date of grant.

The following is a summary of performance restricted stock units activity during the fiscal years ended June 30, 2025 and 2024:

The total vesting date fair value of performance restricted stock units that vested during the fiscal years ended June 30, 2025 and 2024 was approximately $1.1 million and $1.6 million, respectively.

Note 10 —Other Expense, Net

Other expense, net consists of the following (in thousands):

Note 11 —Income Taxes

The income tax expense for the fiscal years ended June 30, 2025 and 2024 consists of the following (in thousands):

The effective income tax rate for the fiscal years ended June 30, 2025 and 2024 differs from the U.S. Federal statutory income tax rate due to the following:

The components of the deferred tax assets and liabilities as of June 30, 2025 and 2024 are as follows (in thousands):

The Company has adopted accounting guidance for uncertain tax positions (“UTPs”) which provides that in order to recognize an uncertain tax benefit, the taxpayer must be more likely than not of sustaining the position. The measurement of the benefit is calculated as the largest amount that is more than 50% likely to be realized upon recognition of the benefit.

In the fiscal year ended June 30, 2024, the Company began recording a withholding tax obligation on certain rebalanced commission payments to the U.S. parent company it had not obtained treaty rates for. The withholding tax recorded in the fiscal year ended June 30, 2024 has been reversed during the fiscal year ended June 30, 2025 as the Company no longer expects to pay that liability.

The Company has been undergoing income tax audits in foreign jurisdictions. For the fiscal year ended June 30, 2025, the Company accrued a total $0.4 million related to foreign income tax audits. In fiscal year 2025, the Company made payments or deemed payments totaling $0.4 million related to these foreign income tax audits. The UTP related to foreign tax audits is now zero. The Company does not have any other foreign tax audits as of June 30, 2025.

The change in the liability for uncertain tax positions were as follows (in thousands):

In fiscal year 2022, the Company removed its permanent reinvestment assertion in Japan. In fiscal year 2024, the Company removed its permanent reinvestment assertions in Taiwan and Australia and recorded the tax effects of that change. In fiscal year 2025, the Company removed its permanent reinvestment assertion on all other entities.

The tax years open for examination by the Internal Revenue Service (“IRS”) include returns for fiscal years June 30, 2021 through present and the open tax years by state tax authorities include returns for fiscal years June 30, 2020 through present. In addition, the IRS and state tax authorities may examine net operating losses (“NOLs”) for any previous years if utilized by the Company.

The change in the valuation allowance were as follows (in thousands):

The change in valuation allowance during the fiscal year ended June 30, 2025 related to current year income in entities with a full valuation allowance along with a change to the United States valuation allowance based on the Company converting from a blended rate to a state-by-state provision. During the fiscal year ended June 30, 2024, the change in valuation allowance related to current year income in entities with a full valuation allowance along with a change to the United States valuation allowance based on updated projections and changes to the blended rate.

As of June 30, 2025, the Company had utilized all of its Federal NOL carry-forwards. As of June 30, 2025, state NOLs were $4.8 million and foreign NOLs were $0.4 million.

The total recognized tax benefit from settlement of stock-based awards for the fiscal years ended June 30, 2025 and 2024, was $0.8 million and $0.2 million, respectively.

The Company has reflected all changes in tax laws including the changes resulting from expiring Tax Cuts and Jobs Act provisions. The Company will reflect the changes from the One Big Beautiful Bill Act in fiscal year 2026, when the law was enacted.

The Company conducts its business globally. As a result, the Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions, and are subject to examination for the open tax years of June 30, 2021 through June 30, 2025.

Note 12 —Leases

The Company has operating leases for current corporate offices and certain equipment. These leases have remaining terms of approximatelyone to 6.5 years. As of June 30, 2025, the weighted average remaining lease term and weighted average discount rate for operating leases was 5.91 years and 3.17%, respectively. As of June 30, 2024, the weighted average remaining lease term and weighted average discount rate for operating leases was 6.90 years and 3.46%, respectively.

The components of lease expense for the fiscal years ended June 30, 2025 and 2024, were as follows (in thousands):

Supplemental cash flow information related to operating leases was as follows (in thousands):

Maturity of lease liabilities at June 30, 2025 are as follows (in thousands):

Note 13 —Segment Information

The Company operates in a single operating segment by selling products directly to customers through an international network of independent consultants that operates in an integrated manner from market to market. The Company manages its business primarily by managing its international network of independent consultants through similar commission plans. Most products available to customers in the United States are available to customers across all markets. These products are purchased through third-party manufacturers by the US Corporate office and sold to each international market. Pricing for all products is determined at the US Corporate office. Accordingly, for disclosure purposes, the Company has a single reporting segment, which is reported on the Company’s consolidated financial statements.

The Chief Operating Decision Maker (“CODM”) is the Company’s Chief Executive Officer. The CODM regularly reviews consolidated financial information and performance used to make decisions about the Company as a whole and without distinguishing or grouping of operations based on asset type, revenue, geographic location, tenant or other factors.

The CODM evaluates performance through consolidated financial budget-to-actual variances on a monthly and quarterly basis and allocates resources based on net income as reported in the consolidated statements of operations. The measure of segment assets is reported on the balance sheet as total consolidated assets. Total expenditures for long-lived assets are reported on the consolidated statements of cash flows.

The following table presents the Company’s segment revenue and expenses and segment net income for the fiscal years ended June 30, 2025 and 2024 (in thousands):

(1) Other general and administrative expenses include legal, professional services, rent, utilities, and other miscellaneous expenses.

The following table presents the Company’s long-lived assets for its most significant geographic markets (in thousands):

The Company has identifiedtwo major markets with revenues exceeding 10% of consolidated total revenue: United States and Japan. There are 16 other markets, each of which individually is less than 10% of consolidated total revenue. Sales are recorded in the market in which the transaction occurred. The following table presents the Company’s revenue disaggregated by these markets (in thousands):

Major Products

The Company’s revenue for the fiscal year ended June 30, 2025 is largely attributed tothree product lines, Protandim®, LifeVantage®, and TrueScience®. On a combined basis, these three product lines represent approximately 87.6% of the Company’s total net revenue for the fiscal year ended June 30, 2025. Total revenue for the fiscal year ended June 30, 2024 was largely attributed totwo product lines, Protandim® and TrueScience®, which on a combined basis represented approximately 80.1% of total net revenue for that fiscal year. The following table shows revenue by product line for the fiscal years ended June 30, 2025 and 2024 (in thousands):

(1) Other revenue includes shipping and handling revenue, event related revenue, and other revenues impracticable to allocate to a specific product line.

Note 14 —Commitments and Contingencies

Contingencies

The Company accounts for contingent liabilities in accordance with ASC 450, Contingencies. This guidance requires management to assess potential contingent liabilities that may exist as of the date of the financial statements to determine the probability and amount of loss that may have occurred, which inherently involves an exercise of judgment. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. For loss contingencies considered remote, no accrual or disclosures are generally made. Management has assessed potential contingent liabilities as of June 30, 2025, and based on the assessment there are no probable loss contingencies requiring accrual or disclosures within its financial statements.

Legal Accruals

In addition to commitments and obligations in the ordinary course of business, from time to time, the Company is subject to various claims, pending and potential legal actions, investigations relating to governmental laws and regulations and other matters arising out of the normal conduct of its business. Management assesses contingencies to determine the degree of probability and range of possible loss for potential accrual in the consolidated financial statements. An estimated loss contingency is accrued in the consolidated financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because evaluating legal claims and litigation results are inherently unpredictable and unfavorable results could occur, assessing contingencies is highly subjective and requires judgments about future events. When evaluating contingencies, management may be unable to provide a meaningful estimate due to a number of factors, including the procedural status of the matter in question, the presence of complex or novel legal theories, and/or the ongoing discovery and development of information important to the matters. In addition, damage amounts claimed or asserted against the Company may be unsupported, exaggerated, or unrelated to possible outcomes, and as such are not meaningful indicators of a potential liability. Management regularly reviews contingencies to determine the adequacy of financial statement accruals and related disclosures. The amount of ultimate loss may differ from these estimates. It is possible that cash flows or results of operations could be materially affected in any particular period by the unfavorable publicity or resolution of one or more of these contingencies. Whether any losses finally determined in any claim, action, investigation or proceeding or publicity related to such could reasonably have a material effect on the Company's business, financial condition, results of operations or cash flows will depend on a number of variables, including: the timing and amount of such losses; the structure and type of any remedies; the significance of the impact of any such losses, damages or remedies may have on the consolidated financial statements; and the unique facts and circumstances of the particular matter that may give rise to additional factors.

Other Matters. The Company may become involved in other litigation and regulatory matters incidental to its business and the matters disclosed in this annual report on Form 10-K, including, but not limited to, product liability claims, regulatory actions, employment matters and commercial disputes. The Company intends to defend itself in any such matters and does not currently believe that the outcome of any such matters will have a material adverse effect on the Company's business, financial condition, results of operations and cash flows.

Note 15 — Subsequent Events

On September 3, 2025, the Company entered into an Asset Purchase Agreement to acquire critical assets of a Global Organics Merchants, LLC, dba LoveBiome. The transaction is expected to close by mid-October 2025, subject to satisfaction of customary closing conditions and regulatory requirements. The Company has not yet determined the accounting purchase price allocation of the purchase consideration described above, which includes evaluating the fair value of the acquired assets and the valuation of contingent consideration to be transferred.