VERU INC.

Previous wording

Our future prospects are substantially dependent on our ability to successfully advance the development of enobosarm as a treatment to augment fat loss and to prevent muscle loss in sarcopenic obese or overweight elderly patients receiving a GLP-1 RA. We are currently conducting a Phase 2b multicenter, double-blind, placebo-controlled, randomized, dose-finding clinical trial designed to evaluate the safety and efficacy of enobosarm as a treatment to augment fat loss and to prevent muscle loss in sarcopenic obese or overweight elderly patients receiving a GLP-1 RA who are at-risk for developing muscle atrophy and muscle weakness. On January 27, 2025, we announced topline results from the Phase 2b clinical study, while complete unblinded safety data and topline data from a Phase 2b extension study are expected in the second quarter of calendar 2025. Any delays of or unanticipated changes to the planned Phase 2b extension study may increase our costs, slow down our product development and approval process and jeopardize our ability to develop enobosarm for and ultimately generate revenue from enobosarm as a treatment to augment fat loss and to prevent muscle loss in sarcopenic obese or overweight elderly patients receiving a GLP-1 RA who are at-risk for developing muscle atrophy and muscle weakness, which may cause a change in our development strategy. We will also need to raise additional capital to conduct a Phase 3 trial of enobosarm as a treatment to augment fat loss and to prevent muscle loss in sarcopenic obese or overweight elderly patients receiving a GLP-1 RA, which may not be available when needed or on terms acceptable to us, and if the FDA does not accept our planned Phase 3 trial design, the costs of the Phase 3 trial may exceed our expectations. As a result, we may be forced to abandon our development of enobosarm as a treatment to augment fat loss and to prevent muscle loss in sarcopenic obese or overweight elderly patients receiving a GLP-1 RA who are at-risk for developing muscle atrophy and muscle weakness. There can be no assurances that the FDA will accept our proposed Phase 3 trial design, that we will be able to cost-effectively continue development of enobosarm, or that enobosarm will receive FDA approval or be commercialized, for any application.

Current wording

Our future prospects are substantially dependent on our ability to successfully advance the development of enobosarm as a treatment to augment fat loss and to prevent muscle loss in sarcopenic obese or overweight elderly patients receiving a GLP-1 RA. We have conducted a Phase 2b multicenter, double-blind, placebo-controlled, randomized, dose-finding clinical trial designed to evaluate the safety and efficacy of enobosarm as a treatment to augment fat loss and to prevent muscle loss in sarcopenic obese or overweight elderly patients receiving a GLP-1 RA who are at-risk for developing muscle atrophy and muscle weakness, and have announced topline results from the Phase 2b clinical study as well as complete unblinded safety data and topline data from a Phase 2b extension study. We have been granted a meeting with the FDA to discuss our planned Phase 3 clinical program for enobosarm as a treatment to augment fat loss and to prevent muscle loss in sarcopenic obese or overweight elderly patients receiving a GLP-1 RA for chronic weight management. We will need to raise additional capital to conduct this Phase 3 clinical program, which may not be available when needed or on terms acceptable to us, and if the FDA does not accept our planned Phase 3 trial design, the costs of the Phase 3 trial may exceed our expectations. As a result, we may be forced to abandon our development of enobosarm as a treatment to augment fat loss and to prevent muscle loss in sarcopenic obese or overweight elderly patients receiving a GLP-1 RA who are at-risk for developing muscle atrophy and muscle weakness. There can be no assurances that the FDA will accept our proposed Phase 3 trial design, that we will be able to cost-effectively continue development of enobosarm, or that enobosarm will receive FDA approval or be commercialized, for any application.

Previous wording

There is uncertainty as to whether and when we will receive any future installment payments of purchase price under the ONCO Promissory Notes or sales milestone payments under the Asset Purchase Agreement, and there is a risk of a future default by ONCO in performing its payment obligations, and we do not have a security interest in any of ONCO's assets and accordingly would be an unsecured creditor in the event that ONCO defaulted. We received payment of $1.0 million on September 29, 2023 and total payments of $0.3 million during the year ended September 30, 2024 from ONCO pursuant to the ONCO Promissory Notes. We have entered into the Forbearance Agreement with ONCO, relating to certain defaults under the ONCO Promissory Notes, which includes a forbearance period as to the April 2024 Promissory Note that ends on the earlier of (a) June 30, 2025 and (b) the occurrence of an Event of Default (as defined in the Forbearance Agreement) and an extension of the due date of the September 2024 Promissory Note to June 30, 2025. ONCO is required to make certain Required Payments towards the outstanding balance of the ONCO Promissory Notes during such periods. There can be no assurance as to (1) whether and when we will receive any payments pursuant to the terms of the Forbearance Agreement or otherwise under the ONCO Promissory Notes or any sales milestone payments under the Asset Purchase Agreement, and (2) the extent of the risk of a future default by ONCO in performing its payment or other obligations under the Forbearance Agreement and the ONCO Promissory Notes. If ONCO fails to pay the outstanding ONCO Promissory Notes when due or an event of default under the ONCO Promissory Notes or the Forbearance Agreement otherwise occurs, we may, among other things, declare the full amount outstanding to be due and sue to collect the ONCO Promissory Notes, which actions may force ONCO into bankruptcy. There can be no assurance as to whether we would be able to collect any amounts due under the ONCO Promissory Notes if ONCO files for bankruptcy.

Current wording

There is uncertainty as to whether and when we will receive any future installment payments of purchase price under the ONCO Promissory Notes or sales milestone payments under the Asset Purchase Agreement, and there is a risk of a future default by ONCO in performing its payment obligations, and we do not have a security interest in any of ONCO's assets and accordingly would be an unsecured creditor in the event that ONCO defaulted. We received payment of $1.0 million on September 29, 2023 and total payments of $0.3 million during the year ended September 30, 2024 from ONCO pursuant to the ONCO Promissory Notes. We have entered into the Forbearance Agreement with ONCO, relating to certain defaults under the ONCO Promissory Notes, and have also agreed to extend the due dates for the ONCO Promissory Notes to August 14, 2025. ONCO is required to make the Required Payments towards the outstanding balance of the ONCO Promissory Notes during the period prior to the new due date. There can be no assurance as to (1) whether and when we will receive any payments pursuant to the terms of the Forbearance Agreement or otherwise under the ONCO Promissory Notes or any sales milestone payments under the Asset Purchase Agreement, and (2) the extent of the risk of a future default by ONCO in performing its payment or other obligations under the Forbearance Agreement and the ONCO Promissory Notes. If ONCO fails to pay the outstanding ONCO Promissory Notes when due or an event of default under the ONCO Promissory Notes or the Forbearance Agreement otherwise occurs, we may, among other things, declare the full amount outstanding to be due and sue to collect the ONCO Promissory Notes, which actions may force ONCO into bankruptcy. There can be no assurance as to whether we would be able to collect any amounts due under the ONCO Promissory Notes if ONCO files for bankruptcy.

Previous wording

There are risks and uncertainties associated with the sale of the FC2 Business.

Current wording

There are risks and uncertainties associated with the sale of the FC2 business, including those related to outstanding litigation or other claims by or disputes with the Purchaser of the FC2 business, which could result in substantial legal fees or damages and may divert management’s time and attention from our business.

Previous wording

The Purchase Agreement contains a provision for an adjustment to the purchase price based on the working capital of the FC2 Business as of the closing date. The Purchaser was required to deliver its working capital calculation within 90 days after the closing date. The Purchaser delivered its calculation in April 2025 and we have disputed its calculation. The Purchase Agreement specifies a resolution process for disputes regarding the purchase price adjustment provisions.

Current wording

The Purchase Agreement contains a provision for an adjustment to the purchase price, including an adjustment based on the working capital of the FC2 business as of the closing date. The Purchaser was required to deliver its purchase price adjustment calculation within 90 days after the closing date. The Purchaser delivered its calculation in April 2025 and we have disputed its calculation. This dispute has been submitted to an accounting firm for binding resolution pursuant to the terms of the Purchase Agreement.

Previous wording

We have also agreed to indemnify the Purchaser against certain losses suffered as a result of certain breaches of our representations, warranties, covenants and agreements in the Purchase Agreement and related documents. Any event that results in a right for the Purchaser to seek indemnity from us could result in substantial liability to us and could adversely affect our financial position and results of operations. In April 2024, the Purchaser notified us that it has submitted a claim under the R&W Policy based on alleged breaches by the Sellers of certain representations and warranties in the Purchase Agreement relating to a customer relationship. The Purchaser’s claim notice alleged a loss of approximately $5.1 million and the Purchaser reserved its rights with respect to us. Although our potential exposure to the Purchaser for any claims of breach of these representations and warranties is limited to $54,000 except in the case of fraud, we may incur substantial legal fees and costs if the Purchaser brings a claim against us. Because the Purchaser has not made any claim against us relating to this matter we are not currently able to estimate the possible cost, if any, to us from this matter.

Current wording

We have also agreed to indemnify the Purchaser against certain losses suffered as a result of certain breaches of our representations, warranties, covenants and agreements in the Purchase Agreement and related documents. Any event that results in a right for the Purchaser to seek indemnity from us could result in substantial liability to us and could adversely affect our financial position and results of operations. On August 5, 2025, the Purchaser filed a complaint in the Superior Court of the State of Delaware (the “Clear Future Lawsuit”) alleging that we breached certain representations and warranties in the Purchase Agreement and otherwise made false representations relating to a customer relationship. The complaint makes claims for fraud, breach of representations and warranties, indemnification and breach of contract. Although our potential exposure to the Purchaser for any claims of breach of these representations and warranties is limited to $54,000 except in the case of fraud, we may incur substantial legal fees and costs and such limit will not apply if the Purchaser prevails in its claims for fraud. In June 2025, the Purchaser delivered a demand for indemnification under the Purchase Agreement, which alleged that we are responsible to indemnify the Purchaser for a pre-closing tax liability of approximately $137,000.

Previous wording

As of May 5, 2025, our executive officers and directors collectively beneficially owned approximately 15.2% of the outstanding shares of our common stock, including approximately 6.8% beneficially owned by Mitchell Steiner, M.D., our Chairman, President and Chief Executive Officer, and 6.2% beneficially owned by Harry Fisch, M.D., our Vice Chairman and Chief Corporate Officer. These shareholders may have the ability to exert significant influence over the outcome of shareholder votes, including votes concerning director elections, amendments to our Amended and Restated Articles of Incorporation and other significant corporate transactions. In addition, this concentration of ownership may have the effect of delaying, deferring or preventing a change in control, impeding a merger, consolidation, takeover or other business combination involving us, or discouraging a potential acquiror from making a tender offer or otherwise attempting to obtain control of our business, even if such a transaction would benefit other stockholders. The interests of such stockholders may not always coincide with your interests or the interests of other stockholders and they may act in a manner that advances their best interests and not necessarily those of other stockholders.

Current wording

As of August 7, 2025, our executive officers and directors collectively beneficially owned approximately 15.3% of the outstanding shares of our common stock, including approximately 6.8% beneficially owned by Mitchell Steiner, M.D., our Chairman, President and Chief Executive Officer, and 6.2% beneficially owned by Harry Fisch, M.D., our Vice Chairman and Chief Corporate Officer. These shareholders may have the ability to exert significant influence over the outcome of shareholder votes, including votes concerning director elections, amendments to our Amended and Restated Articles of Incorporation and other significant corporate transactions. In addition, this concentration of ownership may have the effect of delaying, deferring or preventing a change in control, impeding a merger, consolidation, takeover or other business combination involving us, or discouraging a potential acquiror from making a tender offer or otherwise attempting to obtain control of our business, even if such a transaction would benefit other stockholders. The interests of such stockholders may not always coincide with your interests or the interests of other stockholders and they may act in a manner that advances their best interests and not necessarily those of other stockholders.

Previous wording

On August 29, 2024, we received a letter (the “Original Deficiency Letter”) from The Nasdaq Stock Market, LLC ("Nasdaq"), notifying us we had fallen below compliance with respect to the continued listing standard set forth in Rule 5550(a)(2) of the Nasdaq Listing Rules because the closing bid price of our common stock over the previous 30 consecutive trading-day period had fallen below $1.00 per share.

Current wording

Rule 5550(a)(2) of the Nasdaq Listing Rules requires the closing bid price of our common stock to be greater than $1.00 per share. On August 29, 2024, we received a letter (the “Original Deficiency Letter”) from The Nasdaq Stock Market, LLC ("Nasdaq") notifying us that we had fallen below compliance with this listing standard and providing us with a period of 180 calendar days from the date of notification to regain compliance with the minimum bid price requirement, which was subsequently extended to August 25, 2025. On August 8, 2025, we effected a 1-for-10 reverse stock split of all of our issued and outstanding shares of common stock (the “Reverse Stock Split”). In order to regain compliance with the minimum bid price requirement, the closing bid price of our common stock after the Reverse Stock Split must exceed $1.00 per share for a period of ten consecutive trading days.

Previous wording

Sales of a significant number of shares of our common stock, or the expectation that such sales may occur, could significantly reduce the market price of our common stock. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate. We have also registered the offer and sale of all shares of common stock that we may issue under our equity compensation plans, including upon the exercise of stock options, shares of common stock we may issue under our current common stock purchase agreement with Lincoln Park, including 3,025,000 shares of common stock that we have issued under our current common stock purchase agreement with Lincoln Park through the date of this report. These shares can be freely sold in the public market upon issuance.

Current wording

Sales of a significant number of shares of our common stock, or the expectation that such sales may occur, could significantly reduce the market price of our common stock. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate. We have also registered the offer and sale of all shares of common stock that we may issue under our equity compensation plans, including upon the exercise of stock options, shares of common stock we may issue under our current common stock purchase agreement with Lincoln Park, including 302,500 shares of common stock that we have issued under our current common stock purchase agreement with Lincoln Park through the date of this report. These shares can be freely sold in the public market upon issuance.