Longevity Health Holdings, Inc.

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the accompanying audited consolidated financial statements and the related notes contained in Part II, Item 8 of this Annual Report. Certain information in this discussion and analysis or as set forth elsewhere in this Annual Report contains forward-looking statements that involve numerous risks and uncertainties, including, but not limited to, those described under the section entitled “Forward-Looking Statements” in Part I, Item 1. “Business” in this Annual Report and under Part I, Item 1A. “Risk Factors” in this Annual Report. We assume no obligation to update any of these forward-looking statements. Actual results may differ materially from those contained in any forward-looking statements.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the accompanying consolidated financial statements and the related notes contained in Part II, Item 8 of this Annual Report. Certain information in this discussion and analysis or as set forth elsewhere in this Annual Report contains forward-looking statements that involve numerous risks and uncertainties, including, but not limited to, those described under the section entitled “Forward-Looking Statements” in Part I, Item 1. “Business” in this Annual Report and under Part I, Item 1A. “Risk Factors” in this Annual Report. We assume no obligation to update any of these forward-looking statements. Actual results may differ materially from those contained in any forward-looking statements.

Previous wording

Carmell is a bio-aesthetics company that utilizes the Carmell Secretome TM to support skin and hair health. The Carmell Secretome TM consists of a potent cocktail of growth factors and proteins extracted from allogeneic human platelets sourced from U.S. Food and Drug Administration-approved tissue banks. Over the past 7 years, Carmell has extensively tested the technology underpinning the Carmell Secretome TM. In addition, we have developed a novel microemulsion formulation that enables delivery of lipophilic and hydrophilic ingredients without relying on the Foul Fourteen TM, which are 14 potentially harmful excipients that are commonly used by other companies to impart texture, stability, and other desirable physicochemical attributes to cosmetic products. Additionally, Carmell’s microemulsion formulations do not utilize mineral or vegetable oils across its entire product line and are designed to be non-comedogenic. We are also developing a line ofmen’s products and a line of topical haircare products. All of our cosmetic skincare and haircare products are tailored to meet the demanding technical requirements of professional care providers and discerning retail consumers. Our product pipeline also includes innovative regenerative bone and tissue healing products that are under development.

Current wording

We are focused on longevity and healthy aging, encompassing the latest scientific advances in regenerative bio-aesthetics. Our products are aimed to help people look and feel their best at any age. We currently have two cosmetic product lines, Carmell Secretome TM and Elevai Exosomes TM, that support skin and hair health. All of our cosmetic skincare and haircare products are tailored to meet the demanding technical requirements of professional care providers and discerning retail consumers. Our product pipeline also includes innovative regenerative bone and tissue healing products on which further research and development has been paused.

Previous wording

On August 1, 2023, the Company filed an amendment to its Third Amended and Restated Certificate of Incorporation with the Delaware Secretary of State to change its name to “Carmell Corporation.”

Current wording

On March 6, 2025, we filed an amendment to our Third Amended and Restated Certificate of Incorporation, as amended, with the Delaware Secretary of State to change our name from “Carmell Corporation” to “Longevity Health Holdings, Inc.”

Previous wording

Economic uncertainty in various global markets caused by political instability and conflicts, such as the ongoing conflicts in Ukraine and Israel, and economic challenges have led to market disruptions, including significant volatility in commodity prices, credit and capital market instability, and supply chain interruptions, which have caused record inflation globally. Our business, financial condition, and results of operations could be materially and adversely affected by further negative impacts on the global economy and capital markets resulting from these global economic conditions, particularly if such conditions are prolonged or worsen. Although, to date, our results of operations have not been materially impacted by these global economic and geopolitical conditions, it is impossible to predict the extent to which our operations may be impacted in the short and long term. The extent and duration of these market disruptions, whether as a result of the military conflict between Russia and Ukraine, the effects of the Russian sanctions, the conflict between Israel and Hamas, geopolitical tensions, inflation, or otherwise, are impossible to predict. Any such disruptions may also magnify the impact of other risks described or incorporated by reference in this Annual Report.

Current wording

Economic uncertainty in various global markets caused by political instability and conflicts, such as the Russia-Ukraine war, the regional conflict in the Middle East (including the Israel-Hamas war), geopolitical tensions between the United States and China, and proposed tariffs and other trade restrictions by the U.S. government and foreign governments have led to market disruptions, including significant volatility in commodity prices, credit and capital market instability, supply chain interruptions, high levels of inflation and fluctuating interest rates. Our business, financial condition, and results of operations could be materially and adversely affected by further negative impacts on the global economy and capital markets resulting from these global economic conditions, particularly if such conditions are prolonged or worsen. Although, to date, our results of operations have not been materially impacted by these global economic and geopolitical conditions, it is impossible to predict the extent to which our operations may be impacted in the short and long term. The extent and duration of these market disruptions are impossible to predict. Any such disruptions may also magnify the impact of other risks described or incorporated by reference in Part I, Item 1A. "Risk Factors" in this Annual Report.

Previous wording

The audited consolidated financial statements included elsewhere herein for the year ended December 31, 2023, were prepared under the assumption that we would continue our operations as a going concern, which contemplates the realization of assets and the satisfaction of liabilities during the normal course of business. However, as of December 31, 2023, we had cash and cash equivalents of $2,912,461, an accumulated deficit of $58,503,401 and liabilities of $39,199,793. We have incurred substantial recurring losses from continuing operations, have used, rather than provided, cash from our continuing operations and are dependent on additional financing to fund future operations. These conditions raise substantial doubt about our ability to continue as a going concern within one year after the date the financial statements are issued. The audited consolidated financial statements included elsewhere herein do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.

Current wording

The audited consolidated financial statements included elsewhere herein for the year ended December 31, 2024, were prepared under the assumption that we would continue our operations as a going concern, which contemplates the realization of assets and the satisfaction of liabilities during the normal course of business. As of December 31, 2024, we had negative net working capital of $4,921,151, a net loss from continuing operations of $10,650,464, and negative net cash flow from operations of $4,388,948. We have incurred substantial recurring losses from continuing operations, have used, rather than provided, cash from our continuing operations, and are dependent on additional financing to fund future operations. These conditions raise substantial doubt about our ability to continue as a going concern within one year after the date the financial statements are issued. The audited consolidated financial statements included elsewhere herein do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.

Previous wording

In the third quarter of 2023, we significantly reduced our future operating expenses by terminating certain executives serving as part-time consultants and full-time employees in non-core areas or overlapping business functions. This workforce reduction is expected to result in $2,000,000 to $3,000,000 in annual savings. In addition, we have refocused our research and development efforts on aesthetic products that have near-term commercial potential and have reprioritized further development and ceased clinical studies of product candidates that will take more than a year to commercialize. We are also exploring out-licensing certain research and development programs to generate non-dilutive liquidity. Furthermore, we expect the sale of AxoBio will further reduce our operating expenses, which is anticipated to assist us in extending our cash runway.

Current wording

We are also exploring out-licensing certain research and development programs to enhance our liquidity.

Previous wording

General and administrative expenses were $2,622,495 and $3,217,280 for the years ended December 31, 2023 and 2022, respectively. This decrease was primarily driven by the $1,278,062 write-off of costs associated with the Company's aborted initial public offering in October 2022, prior to pursuing the Business Combination. The decrease in general and administrative expenses was partially offset by an increase in salaries and benefits for personnel.

Current wording

General and administrative expenses were $3,715,340 and $2,622,945 for the years ended December 31, 2024 and 2023, respectively. This increase was primarily driven by an increase in insurance costs and salaries and benefits for personnel. In addition, we began to realize savings from the cost reductions discussed above which partially offset the increase in expenses.

Previous wording

In addition to the anticipated cost savings from the restructuring detailed below and the completed sale of AxoBio, we plan to launch a line of cosmetic skincare products in the first half of 2024 based on the technologies we developed through our research and development activities. Management anticipates that revenue from the commercialization of its cosmetic skincare products and the anticipated cost savings from the restructuring will assist us in extending our cash runway. In addition, we are exploring out-licensing of certain research and development programs to generate non-dilutive liquidity.

Current wording

Late in the second quarter of 2024, we began the launch of our cosmetic skincare products based on the Carmell Secretome™. In addition, we completed the Elevai Acquisition on January 16, 2025. The acquired business had revenue of approximately $2,500,000 in 2024. Management anticipates that revenue from the continued commercialization of its cosmetic products and the anticipated cost savings from the restructuring activities detailed above will assist us in extending our cash runway. In addition, we are exploring raising additional capital and the out-licensing of certain research and development programs to enhance our liquidity.

Previous wording

However, the cash available to us may not be sufficient to allow us to operate for the next 12 months due to our current and potential liabilities. We may need to raise additional capital through equity or debt issuances. If we are unable to raise additional capital, we may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations and reducing overhead expenses. We cannot provide any assurance that new financing will be available on commercially acceptable terms, if at all, or will be completed on a timely basis. These conditions raise substantial doubt about our ability to continue as a going concern.

Current wording

However, the cash available to us may not be sufficient to allow us to operate for the next 12 months due to our current and potential liabilities. We may need to raise additional capital through equity or debt issuances. If we are unable to raise additional capital, we may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations and reducing overhead expenses. We cannot provide any assurance that any new financing will be available on commercially acceptable terms, if at all, or will be completed on a timely basis. These conditions raise substantial doubt about our ability to continue as a going concern.

Previous wording

The accompanying audited consolidated financial statements have been prepared in conformity with GAAP, which contemplates the continuation of the Company as a going concern, the realization of assets, and the satisfaction of liabilities in the ordinary course of business. The audited consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty, or that may be necessary should we be unable to continue as a going concern.

Current wording

The accompanying consolidated financial statements have been prepared in conformity with GAAP, which contemplates the continuation of the Company as a going concern, the realization of assets, and the satisfaction of liabilities in the normal course of business. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty, or that may be necessary should we be unable to continue as a going concern.

Previous wording

As of December 31, 2023, we had outstanding indebtedness with principal totaling $1,308,147 as of December 31, 2023 (Note 8 to the accompanying consolidated financial statements). In addition, the Holders of the Convertible Notes have demanded additional payment of principal and interest on the Convertible Notes and certain payments with respect to the Convertible Note Warrants, as more fully described under the section Contingencies below.

Current wording

As of December 31, 2024, we had outstanding debt totaling $241,158 related to the financing of premiums on our insurance programs. In the first quarter of 2024, the Board elected to repay all of the 2023 Promissory Notes (as defined in Note 9 to the accompanying consolidated financial statements) maturing in 2024 in shares of Common Stock in accordance with the terms of the 2023 Promissory Notes. During the year ended December 31, 2024, all of the 2023 Promissory Notes with an aggregate principal amount of $848,500 were repaid through the issuance of an aggregate of 328,707 shares of Common Stock (see Note 9 to the accompanying consolidated financial statements for additional information). In addition, the Holders (as defined in Note 9 to the accompanying consolidated financial statements) of the Convertible Notes have demanded additional payment of principal and interest on the Convertible Notes and certain payments with respect to the Convertible Note Warrants (as defined in Note 9 to the accompanying consolidated financial statements), as more fully described in Note 11 to the accompanying consolidated financial statements.

Previous wording

Net cash provided by financing activities was $11,162,990 for the year ended December 31, 2023, as compared to $3,551,658 for the year ended December 31, 2022. This increase was primarily due to the proceeds of $30,951,174 from the Business Combination and $1,859,980 in proceeds from the issuance of debt in 2023, partially offset by the cash transferred in connection with the Forward Purchase Agreement of $17,535,632 and $2,649,874 of payments on the Company's Convertible Notes.

Current wording

Net cash provided by financing activities was $2,382,422 for the year ended December 31, 2024, as compared to $11,162,990 for the year ended December 31, 2023. During the year ended December 31, 2024, we closed the 2024 Private Placement (as defined in Note 13 to the accompanying consolidated financial statements), which provided net proceeds of $2,687,225. Financing activities in 2023 were driven by the proceeds of $30,951,174 from the Business Combination (as defined in Note 1 to the accompanying consolidated financial statements) and $1,859,980 in proceeds from the issuance of debt and warrants, partially offset by the cash transferred in connection with the FPA of $17,535,632. During the year ended December 31, 2023, we repaid $2,649,874 to the Holders of the Convertible Notes upon the closing of the Business Combination.

Previous wording

On November 8, 2023, Puritan filed a complaint captioned Puritan Partners LLC v. Carmell Regen Med Corporation et al., No. 655566/2023 (New York Supreme Court, New York County) naming the Company as defendant. In the complaint, Puritan asserts that the Company breached its obligations under the Convertible Notes and the Convertible Note Warrants. Puritan also asserts the Company did not comply with its obligations to provide Puritan with 25,000 freely tradeable shares on a timely basis. Puritan asserts claims for declaratory judgment, breach of contract, conversion, foreclosure of its security interest, replevin, unjust enrichment, and indemnification, and seeks remedies including damages totaling $2,725,000 through November 1, 2023, additional fees and interest thereafter, costs and attorney’s fees, an order of foreclosure on its security interest, and other declaratory relief. The Company has moved to dismiss the complaint and intends to defend itself vigorously against this litigation.

Current wording

On November 8, 2023, Puritan filed a complaint captioned Puritan Partners LLC v. Carmell Regen Med Corporation et al., No. 655566/2023 (New York Supreme Court, New York County) naming the Company as defendant. In the complaint, Puritan asserts that we breached our obligations under the Convertible Notes and the Convertible Note Warrants. Puritan also asserts we did not comply with our obligation to provide Puritan with 25,000 freely tradeable shares of Common Stock on a timely basis. Puritan asserts claims for declaratory judgment, breach of contract, conversion, foreclosure of its security interest, replevin, unjust enrichment, and indemnification, and seeks remedies including damages totaling $2,725,000 through November 1, 2023, additional fees and interest thereafter, costs and attorney’s fees, an order of foreclosure on its security interest, and other declaratory relief. The Company carried an accrual for interest payable of $1,175,845 as of December 31, 2024 and 2023, related to the Convertible Notes. In July 2024, the Court dismissed four of the eight claims in the complaint without prejudice. The case is currently in the discovery phase with respect to the remaining claims, which is expected to last through June 2025. We intend to defend ourselves vigorously against this litigation. However, there can be no assurance that this matter will be resolved in our favor, and an adverse outcome could have a material adverse effect on our financial condition.

Previous wording

In addition to financing obligations under our debt agreements, our contractual and commercial commitments include expenditures for operating leases and royalty payments. For further information on our license agreement (see Note 10 to the accompanying consolidated financial statements included herein).

Current wording

In addition to financing obligations under our debt agreements, our contractual and commercial commitments include expenditures for operating leases and royalty payments. In accordance with the terms of the Yuva License, the Company is obligated to pay minimum royalties (as specified in the agreement) to Yuva based on the completion of a joint clinical trial and earned royalties based on net sales of Elevai products. Also, see Note 11 to the accompanying consolidated financial statements for information on our Amended License Agreement with CMU related to our bone and tissue healing products on which further research and development has been paused.

Previous wording

We are also a “smaller reporting company,” meaning that the market value of our stock held by non-affiliates is less than $700 million, and our annual revenue was less than $100 million during the most recently completed fiscal year. We may continue to be a smaller reporting company if either (i) the market value of our stock held by non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year, and the market value of our stock held by non-affiliates is less than $700 million. If we are a smaller reporting company at the time that we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our

Current wording

We are also a “smaller reporting company,” meaning that the market value of our stock held by non-affiliates is less than $700 million, and our annual revenue was less than $100 million during the most recently completed fiscal year. We may continue to be a smaller reporting company if either (i) the market value of our stock held by non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year, and the market value of our stock held by non-affiliates is less than $700 million. If we are a smaller reporting company at the time that we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation.