Item 9A. Controls and Procedures
Item 9A. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, refers to controls and procedures that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that such information is accumulated and communicated to a company's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.
In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Additionally, in designing disclosure controls and procedures, our management was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a control system, misstatements due to error or fraud may occur and not be detected.
Our Chief Executive Officer (our principal executive officer) and our Chief Financial Officer (our principal financial officer) evaluated the effectiveness of our disclosure controls and procedures, as defined in Rules 13a 15(e) and 15d 15(e) under the Exchange Act, as of the end of the period covered by this Annual Report. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of December 31, 2025 due to the material weakness described below.
Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting to provide reasonable assurance of the reliability of financial reporting and of the preparation of financial statements for external reporting purposes, in accordance with GAAP.
The term “internal control over financial reporting” as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act is defined as a process designed by, or under the supervision of, a company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP and includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and disposition of assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures are being made only in accordance with the authorization of its management and directors; and (3) provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on its financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of the effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures included in such controls may deteriorate.
Our Chief Executive Officer (our principal executive officer) and our Chief Financial Officer (our principal financial officer) have assessed the effectiveness of our internal control over financial reporting as of December 31, 2025. In making this assessment, management used the criteria established by the COSO in Internal Control-Integrated Framework (2013). These criteria are in the areas of control environment, risk assessment, control activities, information and communication, and monitoring. Management’s assessment included documentation, evaluating and testing the design and operating effectiveness of its internal controls over financial reporting. Based upon management’s processes and assessments, as described above, management has concluded that, as of December 31, 2025, our internal controls over financial reporting were not effective as the result of a material weakness. A material weakness in an internal control is defined as a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
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This material weakness is related to the inherent limitations of the accounting software used to prepare our financial statements and the limited number of accounting personnel we employ. As a result of these software limitations and the limited number of accounting personnel, we determined that we have insufficient segregation of duties over the initiation, approval and recording of certain financial transactions. While we have implemented multiple compensating controls to mitigate these limitations, management has concluded that these compensating controls are not sufficient to preclude a material weakness as a result of this insufficiency of segregation of duties. Thus, management determined that our internal controls over financial reporting were not effective as of December 31, 2025.
Management has evaluated, and continues to evaluate, avenues for mitigating this material weakness, such as the retention of additional accounting personnel and/or the procurement of alternative accounting software, but these avenues have been deemed to be impractical and prohibitively costly, due to the size of our organization and resources available at the current time. Management expects to continue to utilize the compensating controls in place to mitigate the segregation of duty weakness and will seek to improve on such controls as reasonably possible, until such time as our resources allow for further remediation.
Management does not believe that this control weaknesses has resulted in deficient financial reporting because each of our Chief Executive Officer and Chief Financial Officer is aware of his or her responsibilities under the SEC's reporting requirements and personally certifies our financial reports. Further, we have implemented a series of manual checks and balances to verify that the initiation, approval and recording of certain financial transactions in the current and prior reporting periods has been properly authorized and recorded. So, while management has identified certain material weaknesses in our system of internal control over financial reporting, management believes that it has taken reasonable and sufficient steps to ascertain that the financial information contained in this Annual Report is presented in accordance with GAAP.
Thus, notwithstanding this material weakness, we believe that our financial statements contained in this Annual Report on Form 10-K fairly present our financial position, results of operations and cash flows for the periods covered by this report in all material respects.
Remediation of Prior Material Weakness in Internal Control Over Financial Reporting
As previously disclosed in Item 9A of Part II of our Annual Report on Form 10-K for the year ended December 31, 2024, our management identified a material weakness in our internal control over financial reporting related to the inaccurate computation of the non-cash deemed dividend associated with the repricing of the Series B Common Warrants in accordance with applicable GAAP guidance . This inaccurate computation, if it had remained undetected, would have resulted in a single-digit percentage error in the amount of the net loss attributable to holders of our Common Stock used to compute basic and diluted net loss per share of Common Stock. The amounts presented in our balance sheets, statements of changes in stockholders’ equity (deficit) and statements of cash flows were not affected. This adjustment was corrected prior to the finalization of our prior Annual Report on Form 10-K for the year ended December 31, 2024 and no restatements of any prior periods were required.
As of December 31, 2025, our management determined that this material weakness had been fully remediated. To remediate this material weakness, we implemented a plan which included the (i) continued engagement of third-party professionals with appropriate expertise in accounting and reporting under GAAP and SEC regulations who have adequate experience related to non-recurring debt and equity transactions and (ii) enhancement our documentation procedures related to the accounting treatment for such transactions. These third-party professionals now assist in reviewing the attendant calculations/ additional controls regarding the evaluation of non-recurring debt and equity transactions and assist in reviewing the documentation and related documentation procedures for such transactions. Our management also refined our processes for communicating with our auditor as to when our financial statements and related materials have passed through the Company’s internal control processes. As a result, our management has now determined that this material weakness has been remediated.
Attestation Report of the Registered Public Accounting Firm
This Annual Report does not include an attestation report of our registered public accounting firm due to an exemption provided by the JOBS Act for “emerging growth companies.”
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Changes in Internal Control Over Financial Reporting
Except as disclosed above with respect to the remediation of the material weakness described above, there have been no changes in our internal control over financial reporting during the quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Limitations of Effectiveness of Control
It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system are met. The design of any control system is based, in part, upon the benefits of the control system relative to its costs. Control systems can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. In addition, over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.
Item 9B. OTHER INFORMATION.
Rule 10b5-1 Trading Arrangements
During the three months ended December 31, 2025, none of our directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.
Item 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.
Not applicable.
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PART III
Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
The following table sets forth certain information about our directors and our executive officers as of January 26, 2026.
Name Age Position
Executive Officers
W. Marc Hertz, Ph.D. 56 President, Chief Executive Officer and Director
(Principal Executive Officer)
Leanne Kelly 49 Chief Financial Officer
(Principal Financial and Accounting Officer)
Vipin Kumar, Ph.D.
66 Chief Scientific Officer
Albert Agro, Ph.D. 61 Chief Medical Officer
Non-Employee Directors
David Szekeres (1)(2)
52 Director, Chair of the Board
David Baker 62 Director
Camilla V. Simpson, M.Sc. (1)(2)(3)
54 Director
Roelof Rongen (1)(3)
60 Director
(1) Member of the audit committee.
(2) Member of the compensation committee.
(3) Member of the nominating and corporate governance committee.
Executive Officers
W. Marc Hertz, Ph.D. , has served as our President and Chief Executive Officer and as a member of our Board since April 2023. He co-founded GRI Operations in 2009 and served as Chief Executive Officer and chairperson of its board of directors since its inception. In addition to his management positions, Dr. Hertz previously served on the boards of directors of GemVax AS from 2005 to 2009, Evozym Biologics Inc., from 2014 to 2018, and currently serves on the board of directors of Multimeric Biotherapeutics, a privately-held research and development biotechnology company, a position he has held since 2008. Dr. Hertz has also held several senior positions at companies in the biotechnology industry since 1998, including Pharmexa, Inc., Pharmexa A/S and Multimeric Biotherapeutics, Inc. Dr. Hertz received his undergraduate degree in biology from Bowdoin College and his Ph.D. in immunology and microbiology from the University of Colorado Medical School. We believe Dr. Hertz’s service as GRI Operations’ co-founder and Chief Executive Officer and his extensive experience in the biotechnology industry qualifies him to serve as a member of our Board.
Leanne Kelly has served as our Chief Financial Officer since the closing of the Merger in April 2023. She brings over 20 years of experience leading private and publicly-traded companies across life sciences, technology and e-commerce sectors with a foundation in public accounting. From May 2021 until the closing of the Merger, she served as the Chief Financial Officer of Vallon. From 2016 to 2021, she served as the Controller and Executive Director of Global Financial Reporting at OptiNose, Inc., a multi-million dollar revenue specialty pharmaceutical company. Over the course of her career, she has held Senior Vice President of Finance, Controller and Chief Financial Officer positions in private and public companies such as Flower Orthopedics, Iroko Pharmaceuticals, LLC, and Genaera Corporation. Ms. Kelly began her career as an auditor with KPMG LLP. While serving in those roles, Ms. Kelly's work included multi-million dollar financings, M&A diligence and support. She also has experience in financial oversight, internal and external financial reporting, forecasting, and financial analysis, as well as investor and public relations. Ms. Kelly received her Bachelor of Science degree in Business Economics with a concentration in Accounting from Lehigh University and is a licensed CPA (inactive status) in the state of Pennsylvania.
Vipin Kumar (Chaturvedi), Ph.D. , has served as our Chief Scientific Officer since April 2023. He co-founded GRI Operations in 2009 and, since its inception and until the date of the Merger, served as a member of its board of directors and as chairperson of its scientific advisory board. Dr. Kumar served as GRI Operations’ Chief Scientific Officer from 2009 to 2017 and from 2022 to April 2023. Dr. Kumar has served as a Professor of Medicine, Laboratory of Immune Regulation at the University of California, San Diego since April 2015. In 2015, Dr. Kumar co-founded Simomics, UK, a simulation software company and served as a non-executive director from 2015 to July 2022. Additionally, Dr. Kumar has served on the board of directors of Vidur Discoveries, LLC, a consulting company, since 2009. Dr. Kumar obtained his undergraduate degree in biology from the Kanpur University, India, his master’s in biochemistry, molecular biology and immunology from the Institute of Medical Education & Research, India, and his Ph.D. in biochemistry from the Indian Institute of Science, India.
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Albert Agro, Ph.D. , has served as our Chief Medical Officer since April 2023. He co-founded GRI Operations in 2009 and served as a consultant to GRI Operations with the title Chief Medical Officer from August 2017 until April 2023. Dr. Agro has been serving as the Chief Executive Officer of Jocasta Neuroscience Inc. since June of 2024. He has also served as President and Chief Executive Officer of Columbia Therapeutics Inc. since April 2021 and has over 20 years of experience in the biotechnology and pharmaceutical industries having held several senior clinical and development positions, including Chief Executive Officer of Sublimity Therapeutics Inc. from March 2018 to April 2021 and Chief Medical Officer at Cynapsus from June 2012 to September 2016. Dr. Agro received his Ph.D. in immunology from the Department of Medicine at McMaster University.
Non-Employee Directors
David Szekeres has served as a member of our Board since April 2023. Mr. Szekeres currently serves as the President of Connect Biopharma Holdings Limited, a publicly-traded, U.S.-headquartered global clinical-stage biopharmaceutical company. He has more than two decades of experience in the global life sciences industry as a finance and business development executive, deal maker, legal counsel and board member. Mr. Szekeres joined Heron Therapeutics, Inc. in March 2016 and served as Chief Operating Officer and Head of Finance until August 2023. Prior to this, he served as Chief Business Officer, Principal Financial & Accounting Officer and General Counsel at Regulus Therapeutics Inc. from 2014 to 2016. Mr. Szekeres also served as head of Mergers and Acquisitions at Life Technologies Corporation from 2008 through its acquisition by Thermo Fisher Scientific in February 2014. Mr. Szekeres currently serves on the board of directors at Sanford Burnham Prebys, CureMatch, and Animantis, and as an executive advisory board member at Colossal Biosciences. He served on the board of directors of Edico Genome Inc. from March 2014 until its acquisition by Illumina in 2018 and Patara Pharma from October 2014 until its acquisition by Roivant Sciences in 2018. Mr. Szekeres received his undergraduate degree in criminology, law and society from the University of California, Irvine and his J.D. from Duke University School of Law. We believe that Mr. Szekeres’s extensive experience as an executive and serving on other boards of directors in the biotechnology and biotherapeutics industry qualifies him to serve on our Board.
David Baker has served as a member of our Board from January 15, 2019 until August 23, 2019, and upon the consummation of the initial public offering of our Common Stock on February 12, 2021, he was again appointed as a director. He previously served as Vallon’s President and Chief Executive Officer from January 15, 2019 until April 12, 2023. Mr. Baker has also been serving as the President and Consultant of DB Biopharma Consulting LLC, a life science consulting company, since April 2023. He previously served as the Interim Chief Executive Officer and Chief Commercial Officer of Alcobra Ltd. (now known as Arcturus), where he oversaw the development of ADAIR. Prior to joining Alcobra Ltd., he worked at Shire Pharmaceuticals for 10 years, including as Vice President of Commercial Strategy and New Business in the Neuroscience Business Unit. In that role, Mr. Baker led the commercial assessment of neuroscience licensing opportunities, managed commercial efforts on pipeline central nervous system (CNS) products, and led the long-term strategic planning process. Previously, he served as Global General Manager for Shire’s Vyvanse® where he led the launch of Vyvanse and led global expansion efforts including successful establishment of a partnership in Japan and launches in Canada and Brazil. Prior to that, Mr. Baker served as Vice President of Marketing for all of Shire’s ADHD products. From 1990 through 2004, Mr. Baker worked at Merck & Co., where he held positions of increasing responsibility in marketing, sales, market research, and business development. In addition to his knowledge and experience with CNS medications, Mr. Baker’s expertise includes therapeutics for osteoporosis, migraine, and hyperlipidemia. He has been directly involved with the marketing of five medications with annual sales in excess of $1.0 billion each. Mr. Baker graduated Magna Cum Laude with a bachelor’s degree in Economics and Computer Science from Duke University. He earned a Master of Business Administration in Marketing from Duke’s Fuqua School of Business. Mr. Baker also serves on the board of directors of Benchworks, Inc., a private healthcare advertising agency. We believe that Mr. Baker’ service as Vallon’s President and Chief Executive Officer and his extensive expertise in the biotechnology industry qualifies him to serve as a member of our Board.
Roelof Rongen has served as a member of our Board since April 2023. He is a serial entrepreneur, company builder and Research and Development/Commercial Development leader with extensive experience across many therapeutic areas and functions. Mr. Rongen has served as Chief Executive Officer of Adolore BioTherapeutics, a gene-therapy company, since July 2022, Founder/Chief Executive Officer of Innovative Molecules since June 2019, and Managing Member of AsteRx Pharma Consulting since September 2018. In 2012, he founded and progressed Matinas BioPharma (omega-3 and lipid-crystal nano-particle drug delivery) into a public company (NYSE:MTNB) until his departure in March 2018. Mr. Rongen was integral to the development and commercialization of products such as Humira® and Lovaza®. Prior to founding Matinas BioPharma, Mr. Rongen served as Executive Vice President at Trygg Pharma from 2010 to 2012 where he facilitated Norway’s Aker Group’s entry into the prescription omega-3 business, and ultimate sale to FMC. Before Aker, Mr. Rongen was VP for IP and Portfolio Management at Reliant Pharmaceuticals (acquired by GlaxoSmithKline) where he in-licensed Lovaza® and led development and pre-launch activities. Earlier in his career, Mr. Rongen was Global Product Director for Humira® and other Immunology Programs at BASF Pharma (acquired by Abbott/Abbvie). Mr. Rongen started his professional career as a management
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consultant at Arthur D. Little’s Technology Innovation Management practice and as a biotechnology/pharmaceutical consultant at The Wilkerson Group (acquired by IBM). Mr. Rongen received a Master of Science in Engineering in Molecular Sciences (with Biotechnology/Bio-Process Technology focus) from Wageningen University in the Netherlands and a Master of Business Administration from the Kellogg Business School at Northwestern University. We believe that Mr. Rongen’s experience in the biopharmaceutical industry qualifies him to serve on our Board.
Camilla V. Simpson, M.Sc. , has served as a member of our Board since April 2023. She has served as a member of Spruce Biosciences board of directors since October 2017. Since April 2021, Ms. Simpson has been Chief Executive Officer of Zehna Therapeutics, an early stage biotechnology company and a spin-out from the Cleveland Clinic. Since April 2019, Ms. Simpson has been the Managing Member and President of Rare Strategic, LLC where she provides strategic advice and consulting services to biotechnology companies. Ms. Simpson joined the board of directors of Dyve Biosciences in December 2020. From April 2017 to April 2019, Ms. Simpson was SVP, Head of Product Portfolio Development at BioMarin where she was responsible for corporate and Research and Development governance, program leadership, project management, competitive intelligence, portfolio strategy, and business analytics. From October 2014 to April 2017, Ms. Simpson was Group Vice President Global Regulatory Affairs at BioMarin, and from March 2014 to October 2014, Ms. Simpson was Vice President Regulatory Affairs EU at BioMarin. She also spent 12 years at Shire, where after multiple roles of increasing responsibility, ultimately held the position of Vice President of Regulatory Affairs Early Development and Business Development. Ms. Simpson holds a Bachelor of Science from University College Galway, Ireland, a Bachelors of Science (Honors) from Kingston University, United Kingdom, and an Master of Science with distinction from University of London, UK. We believe that Ms. Simpson’s extensive experience serving as an executive, director and consultant in the biotechnology industry qualifies her to serve as a member of our Board.
Family Relationships
There is no family relationship between any director, executive officer or person nominated to become a director or executive officer.
Board Composition
Our amended and restated certificate of incorporation and amended and restated bylaws provide that the number of directors on our Board shall be determined from time to time by resolution of the Board or our stockholders, and the current size of our Board is five members.
Our amended and restated bylaws also provide that our directors may be removed from office with or without cause by vote of the holders of a majority of the shares of stock entitled to vote in the election of directors.
Our current and future executive officers and significant employees serve at the discretion of our Board.
Our Board is divided into three classes with staggered three-year terms. At each annual meeting of stockholders, the directors whose terms then expire will be subject to re-election to serve until the third annual meeting following re-election. As a result, only one class of directors will be elected at each annual meeting of our stockholders, with the other classes continuing for the remainder of their respective three-year terms. Our directors are divided among the three classes as follows:
• the Class I director is David Baker, and his term expires at the annual meeting of stockholders to be held in 2027;
• the Class II directors are Roelof Rongen and Camilla V. Simpson, M.Sc., and their term expires at the annual meeting of stockholders to be held in 2028; and
• the Class III directors are W. Marc Hertz, Ph.D., and David Szekeres, and their term expires at the annual meeting of stockholders to be held in 2026.
Our amended and restated certificate of incorporation and amended and restated bylaws provide that only our Board can fill vacancies on the Board, including due to increases in the size of the Board. Any additional directorships resulting from an increase in the authorized number of directors would be placed among the three classes so that, as nearly as possible, each class consists of one-third of the authorized number of directors.
Director Independence
Under the listing requirements of The Nasdaq Capital Market, independent directors must comprise a majority of a listed company’s board of directors within 12 months from the date of listing. In addition, subject to specified exceptions, each member of a listed company’s audit, compensation and nominating and corporate governance committees must be independent within 12 months from the date of listing. Audit committee members must also satisfy additional independence criteria,
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including those set forth in Rule 10A-3 under the Exchange Act and compensation committee members must also satisfy the independence criteria set forth in Rule 10C-1 under the Exchange Act. A director will only qualify as an “independent director” if, in the opinion of that company’s board of directors, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In order to be considered independent for purposes of Rule 10A-3 under the Exchange Act, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the board of directors or any other board committee: (1) accept, directly or indirectly, any consulting, advisory or other compensatory fee from the listed company or any of its subsidiaries, other than compensation for board service; or (2) be an affiliated person of the listed company or any of its subsidiaries. In order to be considered independent for purposes of Rule 10C-1, the board of directors must consider, for each member of a compensation committee of a listed company, all factors specifically relevant to determining whether a director has a relationship to such company which is material to that director’s ability to be independent from management in connection with the duties of a compensation committee member, including, but not limited to: the source of compensation of the director, including any consulting advisory or other compensatory fee paid by such company to the director, and whether the director is affiliated with the company or any of its subsidiaries or affiliates.
Our Board has determined that all members of the Board, except W. Marc Hertz, Ph.D. and David Baker, are independent directors, including for purposes of the rules of The Nasdaq Capital Market and the SEC. In making such independence determination, our Board considered the relationships that each non-employee director has with us and all other facts and circumstances that our Board deemed relevant in determining their independence, including the beneficial ownership of our capital stock by each non-employee director. The composition and functioning of our Board and each of our committees comply with all applicable requirements of The Nasdaq Capital Market and the rules and regulations of the SEC.
Committees of the Board of Directors
Our Board has the ability to establish committees and has established an audit committee, a compensation committee and a nominating and corporate governance committee and may establish other committees to facilitate the management of our business. Members serve on these committees until their resignation or until otherwise determined by our Board. Our Board and its committees set meeting schedules throughout the year and can also hold special meetings and act by written consent from time to time, as appropriate.
The committees regularly report on their activities and actions to the full Board. Each member of each committee of our Board qualifies as an independent director in accordance with the listing standards of The Nasdaq Capital Market. Each committee of our Board has a written charter that was approved by our Board.
Copies of each charter are posted on our website at www.gribio.com under the “ Investors ” section. Information contained on our website is not incorporated by reference into this Annual Report. We have included our website address in this Annual Report on Form 10-K solely as an inactive textual reference.
Audit Committee
The members of our audit committee are Roelof Rongen, Camilla V. Simpson, M.Sc., and David Szekeres, who is the chairperson of the audit committee.
Our audit committee assists our Board with its oversight of the integrity of our financial statements; our compliance with legal and regulatory requirements; the qualifications, independence and performance of the independent registered public accounting firm; the design and implementation of our financial risk assessment and risk management, including cybersecurity risk management. Among other things, our audit committee is responsible for reviewing and discussing with our management the adequacy and effectiveness of our disclosure controls and procedures. Our audit committee also discusses with our management and independent registered public accounting firm the annual audit plan and scope of audit activities, scope and timing of the annual audit of our financial statements, and the results of the audit, quarterly reviews of our financial statements and, as appropriate, initiates inquiries into certain aspects of our financial affairs.
Our audit committee is responsible for establishing and overseeing procedures for the receipt, retention and treatment of any complaints regarding accounting, internal accounting controls or auditing matters, as well as for the confidential and anonymous submissions by our employees of concerns regarding questionable accounting or auditing matters. In addition, our audit committee has direct responsibility for the appointment, compensation, retention and oversight of the work of our independent registered public accounting firm. Our audit committee has sole authority to approve the hiring and discharging of our independent registered public accounting firm, all audit engagement terms and fees and all permissible non-audit engagements with the independent auditor. Our audit committee reviews and oversees all related person transactions in accordance with our policies and procedures.
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Each member of our audit committee is independent under the rules and regulations of the SEC and the listing standards of The Nasdaq Capital Market applicable to audit committee members. Our Board has determined that David Szekeres qualifies as an audit committee financial expert within the meaning of SEC regulations and meets the financial sophistication requirements of The Nasdaq Capital Market listing standards. In making this determination, our Board has considered Mr. Szekeres’ prior experience, business acumen and independence. Both our independent registered public accounting firm and management periodically meets privately with our audit committee.
We believe that the composition and functioning of our audit committee complies with all applicable requirements of Section 404 of SOX, and all applicable SEC and The Nasdaq Capital Market rules and regulations. We intend to comply with future requirements to the extent they become applicable to us.
Compensation Committee
The members of our compensation committee are David Szekeres and Camilla V. Simpson, M.Sc., who is the chairperson of the compensation committee.
Each member of our compensation committee is independent under the rules and regulations of the SEC and the listing standards of The Nasdaq Capital Market applicable to compensation committee members. Our compensation committee assists our Board with its oversight of the forms and amount of compensation for our executive officers (including officers reporting under Section 16 of the Exchange Act), the administration of our equity and non-equity incentive plans for employees and other service providers and certain other matters related to our compensation programs. Our compensation committee, among other responsibilities, evaluates the performance of our Chief Executive Officer and, in consultation with him, evaluates the performance of our other executive officers (including officers reporting under Section 16 of the Exchange Act). Our compensation committee also administers our A&R 2018 Plan. The compensation committee is responsible for the determination of the compensation of our Chief Executive Officer, and will conduct its decision making process with respect to that issue without the Chief Executive Officer present.
The compensation committee has adopted the following processes and procedures for the consideration and determination of executive and director compensation:
• Evaluating, recommending, approving, and reviewing executive officer and director compensation arrangements, plans, policies, and programs;
• Administering our cash-based and equity-based compensation plans; and
• Making recommendations to our Board regarding any other Board responsibilities relating to executive compensation.
Nominating and Corporate Governance Committee
The members of our nominating and corporate governance committee are Camilla V. Simpson, M.Sc. and Roelof Rongen, who is the chairperson of the nominating and corporate governance committee.
Each member of our nominating and corporate governance committee is independent under the rules and regulations of the SEC and the listing standards of The Nasdaq Capital Market, applicable to nominating and corporate governance committee members. Our nominating and corporate governance committee’s responsibilities include:
• evaluating and making recommendations to the full Board as to the composition, organization and governance of our Board and its committees;
• evaluating and making recommendations as to director candidates;
• evaluating current Board members’ performance;
• developing continuing education programs for directors, as needed;
• overseeing the process for the dissemination of information to the Board and its committees;
• reviewing its own performance and the nominating and corporate governance committee charter annually;
• overseeing the process for chief executive officer and other executive officer succession planning; and
• developing and recommending governance guidelines for the Company.
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Certain Corporate Governance Matters
Director Nominations
No material changes have been made to the procedures by which stockholders may recommend nominees to our Board.
Board Leadership Structure and Role of the Board in Risk Oversight
The Board is responsible for the control and direction of the Company. At present, the Board has elected to separate the positions of chairperson and Chief Executive Officer. Dr. Hertz will serve as Chief Executive Officer of the Company and as a member of the Board. Mr. Szekeres will serve as the chairperson of the Board. The Board believes that this structure will serve the Company well by maintaining a link between management, through Dr. Hertz’s membership on the Board, and the non-executive directors led by Mr. Szekeres in his role as a non-executive chairperson.
One of the key functions of our Board is informed oversight of our risk management process. The Board does not have a standing risk management committee, but rather administers this oversight function directly through the Board as a whole, as well as through the various standing committees of our Board that address risks inherent in their respective areas of oversight. In particular, our Board is responsible for monitoring and assessing strategic risk exposure and our audit committee has the responsibility to consider and discuss our major financial risk exposures facing the Company and the steps management has taken to monitor and control these exposures, including guidelines and policies to govern the process by which risk assessment and management is undertaken. The audit committee also monitors compliance with legal and regulatory requirements. Our nominating and corporate governance committee monitors the effectiveness of our corporate governance practices, including whether such practices are successful in preventing illegal or improper liability-creating conduct. Our compensation committee assesses and monitors whether any of our compensation policies and programs has the potential to encourage excessive risk-taking.
Compensation Committee Interlocks and Insider Participation
No member of our compensation committee has ever been an executive officer or employee of the Company. None of our officers currently serves, or has served during the last completed fiscal year, on any other entity’s board of directors, compensation committee or other committee that serves an equivalent function as our compensation committee and that has one or more officers who serves as a member of our Board or compensation committee.
Code of Business Conduct and Ethics
We have adopted a written Code of Business Conduct and Ethics (the Code of Conduct) applicable to all of our employees, executive officers and directors. The Code of Conduct covers fundamental ethical and compliance-related principles and practices such as accurate accounting records and financial reporting, avoiding conflicts of interest, the protection and use of our property and information and compliance with legal and regulatory requirements. Our Code of Conduct is available on the “ Investors — Corporate Governance” section of our website at www.gribio.com and will be made available to stockholders without charge, upon request, by writing to the Corporate Secretary at 2223 Avenida de la Playa, Suite 208, La Jolla, CA 92037.
Our nominating and corporate governance committee is responsible for overseeing our Code of Conduct and must approve any waivers of the Code of Conduct for employees, executive officers or directors. We intend to disclose any future amendments to, or waivers from, our Code of Conduct in a Current Report on Form 8-K within four business days of the waiver or amendment, unless website posting or the issuance of a press release of such amendments or waivers is then permitted by Nasdaq rules.
Insider Trading Policy
We maintain an Insider Trading Policy that, among other things, generally prohibits all persons who are aware of material information about the Company that is not generally known or available to the public, including our officers, directors and employees, from engaging in transactions involving our shares (including transactions of our shares by or on behalf of the Company) without first obtaining pre-clearance of the transaction by following the procedures described in the Insider Trading Policy. This includes short sales, hedging of share ownership positions, and transactions involving derivative securities relating to our shares. This policy is included as Exhibit 19 to this Annual Report.
Item 11. EXECUTIVE COMPENSATION.
Summary Compensation Table
Our named executive officers for the year ended December 31, 2025 were W. Marc Hertz, Ph.D., our President and Chief Executive Officer; Leanne Kelly, our Chief Financial Officer; and Vipin Kumar, Ph.D., our Chief Scientific Officer. The
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following table summarizes information concerning the compensation awarded to, earned by, or paid for services rendered in all capacities by our named executive officers during the years ended December 31, 2025 and 2024.
Name and Principal Position Year Salary ($)
Bonus ($) Option
Awards ($) (1)
Non-Equity
Incentive
Compensation ($) (2)
All Other
Compensation
($)
Total ($)
W. Marc Hertz, Ph.D.
2025 575,900 — 274,738 158,373 18,209 (3)
1,027,219
President and Chief Executive Officer 2024 458,708 — — 158,373 143 617,224
Leanne M. Kelly 2025 384,300 — 109,985 76,860 13,577 (4)
584,722
Chief Financial Officer
2024 342,417 50,000 (5)
— 76,860 143 469,420
Vipin Kumar, Ph.D.
2025 384,300 — 109,985 76,860 7,942 (6)
579,088
Chief Scientific Officer
2024 342,417 — — 76,860 143 419,420
(1) Reflects the aggregate grant date fair value of stock options granted during the fiscal year calculated in accordance with FASB ASC Topic 718. These amounts do not necessarily correspond to the actual value that may be realized by the executive in connection with the option awards. The assumptions made in valuing the option awards reported in this column are described in the Company’s audited consolidated financial statements (Note 3. Summary of Significant Accounting Policies and Note 8. Stock Based Compensation ) included in this Annual Report.
(2) The amounts in this column represent performance bonuses earned by the named executive officers in the year shown based upon the achievement of pre-established performance objectives. See “Executive Compensation — Elements of Compensation — Bonuses and Non-Equity Incentive Plan Compensation” below.
(3) Consists of $18,083 in matching contributions to Dr. Hertz’s account under the GRI Bio, Inc. 401K plan, and $126 in group term life insurance premiums paid on behalf of Dr. Hertz.
(4) Consists of $13,451 in matching contributions to Ms. Kelly’s account under the GRI Bio, Inc. 401k plan, and $126 in group term life insurance premiums paid of behalf of Ms. Kelly.
(5) Pursuant to her employment agreement, Ms. Kelly was paid a retention bonus of $50,000 on April 21, 2024.
(6) Consists of $7,846 in matching contributions to Dr. Kumar’s account under the GRI Bio, Inc. 401k plan and $96 group term life insurance premiums paid on behalf of Dr. Kumar.
Elements of Compensation
2025 Base Salaries
Effective August 1, 2024, the base salaries of Dr. Hertz, Ms. Kelly and Dr. Kumar were increased to $575,900, $384,300 and $384,300, respectively.
Bonuses and Non-Equity Incentive Plan Compensation
Dr. Hertz, Ms. Kelly and Dr. Kumar are each eligible to receive a discretionary annual performance bonus with a target bonus equal to 55%, 40% and 40% of their then current base salary, respectively. For the fiscal year ended December 31, 2025, based on the achievement level of performance objectives, the Board awarded an annual performance bonus of $158,373 to Dr. Hertz and $76,860 to each of Ms. Kelly and Dr. Kumar.
Option Awards Granted During 2025
On January 23, 2025, the Board granted 272 incentive stock options to purchase our Common Stock to Dr. Hertz and 91 incentive stock options to purchase our Common Stock to each of Ms. Kelly and Dr. Kumar with an exercise price of $326.48 per share which was equal to the closing price of our Common Stock on the date of grant. The shares underlying these options vested at the time of grant.
On August 26, 2025, the Board granted 953 incentive stock options to purchase our Common Stock to Dr. Hertz and 423 incentive stock options to purchase our Common Stock to each of Ms. Kelly and Dr. Kumar with an exercise price of $39.48 per share which was equal to the closing price of our Common Stock on the date of grant. An aggregate of 1,166 options vested at the time of grant. The unvested options will vest on a quarterly vesting schedule over three years from the date of grant, subject to the holder’s continued service to the Company.
On September 18, 2025, the Board granted 3,680 incentive stock options to purchase our Common Stock to Dr. Hertz and 1,543 incentive stock options to purchase our Common Stock to each of Ms. Kelly and Dr. Kumar with an exercise price of $54.04 per share which was equal to the closing price of our Common Stock on the date of grant. An aggregate of 4,867 options vested at the time of grant. The unvested options will vest on a quarterly vesting schedule over three years from the date of grant, subject to the holder’s continued service to the Company.
Pension Benefits
We do not have any qualified or non-qualified defined benefit plans or profit-sharing plans.
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Non-qualified Deferred Compensation
We do not maintain any non-qualified defined contribution plans or other deferred compensation plans.
Employee Benefits
Our named executive officers participate in employee benefit programs available to our employees generally, including medical, vision and dental insurance and a tax-qualified 401(k) plan.
Employment Agreements
We have entered into an employment agreement with each of our named executive officers. The employment agreements provide that the executive will receive a base salary and be eligible to receive an annual cash bonus contingent upon the attainment of certain company milestones and/or individual objectives. Pursuant to the employment agreements, each executive's base salary and target bonus will be reviewed periodically by our compensation committee or Board. The employment agreements also provide for certain termination benefits, which are described below in the section entitled “ Potential Payments Upon a Termination or Change in Control .”
Our named executive officers are also entitled to participate in all of our retirement and group welfare plans, subject to the terms and conditions applicable to such plans. Further, each named executive officer's employment agreement contains restrictive covenants relating to non-disclosure of confidential information, mutual non-disparagement and assignment of inventions provisions. The employment agreement with Ms. Kelly also includes non-competition and non-solicitation provisions.
Potential Payments Upon a Termination or Change in Control
In addition to those potential payments described below, regardless of the manner in which a named executive officer’s service terminates, that named executive officer is entitled to receive compensation amounts earned during his or her term of service, including unpaid salary and other accrued benefits, as applicable. In addition, each named executive officer is entitled to receive certain benefits upon the Company’s termination of his or her employment without cause or his or her resignation for good reason.
W. Marc Hertz, Ph.D.
Pursuant to his employment agreement with us, if Dr. Hertz’s employment were terminated by us without cause or terminated by Dr. Hertz for good reason, in either case not in connection with a change in control, then Dr. Hertz would be entitled to the following severance benefits:
• continued base salary for a period of 12 months, plus a pro-rated bonus for the year of termination, based on actual performance results for the entire year, and provided he was employed for at least six months during that year; and
• subsidized premiums for COBRA continuation coverage for a period of 12 months (or such earlier date that he obtains alternative coverage).
Pursuant to his employment agreement with us, if Dr. Hertz’s employment were terminated by us without cause or terminated by Dr. Hertz for good reason, in either case within the one-year period following a change in control transaction, then Dr. Hertz would be entitled to the following severance benefits:
• a lump sum payment equal to 18 months of his annual base salary, plus a lump sum payment equal to 150% of his target bonus, without proration, for the fiscal year of termination;
• subsidized premiums for COBRA continuation coverage for a period of 18 months (or such earlier date that he obtains alternative coverage); and
• accelerated vesting of all outstanding stock-based awards held by the executive as of the date of termination, with any performance awards deemed satisfied at the “target” performance level, and any stock options remaining outstanding for their full term.
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Leanne Kelly
Pursuant to her employment agreement with us, if Ms. Kelly’s employment were terminated by us without cause or terminated by Ms. Kelly for good reason, in either case not in connection with a change in control, then Ms. Kelly would be entitled to the following severance benefits:
• continued base salary for a period of nine months, plus a pro-rated bonus for the year of termination, based on actual performance results for the entire year, and provided she was employed for at least six months during that year; and
• subsidized premiums for COBRA continuation coverage for a period of nine months (or such earlier date that she obtains alternative coverage).
Pursuant to her employment agreement with us, if Ms. Kelly’s employment were terminated by us without cause or terminated by Ms. Kelly for good reason, in either case within the one-year period following a change in control transaction, then Ms. Kelly would be entitled to the following severance benefits:
• a lump sum payment equal to 12 months of her annual base salary, plus a lump sum payment equal to 100% of her target bonus, without proration, for the fiscal year of termination;
• subsidized premiums for COBRA continuation coverage for a period of 12 months (or such earlier date that she obtains alternative coverage); and
• accelerated vesting of all outstanding stock-based awards held by the executive as of the date of termination, with any performance awards deemed satisfied at the “target” performance level, and any stock options remaining outstanding for their full term.
Vipin Kumar, Ph.D.
Pursuant to his employment agreement with us, if Dr. Kumar’s employment were terminated by us without cause or terminated by Dr. Kumar for good reason, in either case not in connection with a change in control, then Dr. Kumar would be entitled to the following severance benefits:
• continued base salary for a period of nine months, plus a pro-rated bonus for the year of termination, based on actual performance results for the entire year, and provided he was employed for at least six months during that year; and
• subsidized premiums for COBRA continuation coverage for a period of nine months (or such earlier date that he obtains alternative coverage).
Pursuant to his employment agreement with us, if Dr. Kumar’s employment were terminated by us without cause or terminated by Dr. Kumar for good reason, in either case within the one-year period following a change in control transaction, then Dr. Kumar would be entitled to the following severance benefits:
• a lump sum payment equal to 12 months of his annual base salary, plus a lump sum payment equal to 100% of his target bonus, without proration, for the fiscal year of termination;
• subsidized premiums for COBRA continuation coverage for a period of 12 months (or such earlier date that he obtains alternative coverage); and
• accelerated vesting of all outstanding stock-based awards held by the executive as of the date of termination, with any performance awards deemed satisfied at the “target” performance level, and any stock options remaining outstanding for their full term.
Outstanding Equity Awards at Fiscal Year-End
Stock Option Awards
The following table sets forth the outstanding stock option awards as of December 31, 2025, held by our named executive officers, on an award-by-award basis, setting forth the total number of shares underlying each stock option award that are (i)
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exercisable, but not yet exercised, (ii) unexercisable and not yet exercised, and (iii) total aggregate amount underlying each award.
Option Awards
Name Number of Securities Underlying Unexercised, Options (#) Exercisable Number of Securities Underlying Unexercised, Options (#) Unexercisable Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) Option Exercise Price ($) Option Expiration Date
W. Marc Hertz, Ph.D.
272 — — 326.48 1/23/2035
President and Chief Executive Officer 662 291 (1)
— 39.48 8/26/2035
2,810 870 (2)
— 54.04 9/18/2035
Leanne M. Kelly
— 1 (3)
— 65,840.32 9/22/2033
Chief Financial Officer
91 — — 326.48 1/23/2035
278 145 (4)
— 39.48 8/26/2035
1,107 436 (5)
— 54.04 9/18/2035
Vipin Kumar, Ph.D.
91 — — 326.48 1/23/2035
Chief Scientific Officer
278 145 (4)
— 39.48 8/26/2035
1,107 436 (5)
— 54.04 9/18/2035
__________________
(1) Represents option to purchase shares of our Common Stock granted on August 26, 2025, 662 shares underlying this option vested in full on the date of grant and the remaining 291 options, subject to continued service, vest in 12 substantially equal quarterly installments thereafter such that the stock option is fully vested on the third anniversary of the date of grant.
(2) Represents option to purchase shares of our Common Stock granted on September 18, 2025, 2,810 shares underlying this option vested in full on the date of grant (September 18, 2025) and the remaining 870 options, subject to continued service, vest in 12 substantially equal quarterly installments thereafter such that the stock option is fully vested on the third anniversary of the date of grant.
(3) Represents an option to purchase shares of our Common Stock granted on September 22, 2023.The shares underlying this stock option award vested 25% on the first anniversary of the date of grant and vests, subject to continued service, 2.083% (1/48th of such shares) on each subsequent month thereafter.
(4) Represents option to purchase shares of our Common Stock granted on August 26, 2025, 278 shares underlying this option vested in full on the date of grant and the remaining 145 options vest, subject to continued service, in 12 substantially equal quarterly installments thereafter such that the stock option is fully vested on the third anniversary of the date of grant.
(5) Represents option to purchase shares of our Common Stock granted on September 18, 2025, 1,107 shares underlying this option vested in full on the date of grant and the remaining 436 options vest, subject to continued service, in 12 substantially equal quarterly installments thereafter such that the stock option is fully vested on the third anniversary of the date of grant.
Director Compensation and Compensation Table
Our director compensation program is designed to enhance our ability to attract and retain highly qualified directors and to align their interests with the long-term interests of our stockholders. The program generally includes a cash component, which is designed to compensate non-employee directors for their service on our Board and an equity component, which is designed to align the interests of non-employee directors and stockholders. Directors who are employees of the Company receive no additional compensation for their service on our Board.
The compensation committee annually reviews compensation paid to our non-employee directors and makes recommendations for adjustments, as appropriate, to the full Board. As part of this annual review, the compensation committee considers the significant time commitment and skill level required by each non-employee director in serving on our Board and its various committees. The compensation committee seeks to maintain a market competitive director compensation program and benchmarks our director compensation program against those maintained by our peer group.
Our amended and restated non-employee director compensation program provides that each non-employee Board member will receive the following compensation:
• An annual cash retainer of $40,000 for service on the Board, an annual cash retainer of $7,500 for service on the audit committee, an annual cash retainer of $6,000 for service on the compensation committee and an annual cash retainer of
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$5,000 for service on the nominating and corporate governance committee, which the non-employee director may instead elect to receive any of the annual retainers in an award of a stock option in lieu of cash, provided that the compensation committee determines in its discretion that a sufficient number of shares remain available for issuance pursuant to the A&R 2018 Plan or pursuant to any then-effective equity incentive plan.
• Non-employee directors who are first appointed or elected to the Board will receive an initial stock option grant to purchase a number of shares of our Common Stock equal to the quotient obtained by dividing $100,000 by the closing price of our Common Stock on the date of such director’s initial election or appointment, provided, however, in no event will the number of shares underlying such grant exceed 0.36% of our issued and outstanding shares of Common Stock on such grant date, which generally will vest in quarterly installments over three years.
• A non-employee director who (i) is serving on the Board as of the date of any annual meeting of our stockholders after August 11, 2025 and has been serving as a non-employee director for at least six months as of the date of such meeting, and (ii) will continue to serve as a non-employee director immediately following such meeting, shall be automatically granted an option grant to purchase a number of shares of Common Stock equal to the quotient obtained by dividing $50,000 (or for the Chairperson or the Board, $83,333) by the closing price of the Common Stock on the date of such annual meeting rounded down to the nearest whole share; provided, however, in no event will the number of shares underlying such grant exceed 0.18% (or, for the Chairperson of the Board, 0.3%) of the issued and outstanding shares of Common Stock on such grant date. Such options generally will vest in quarterly installments over one year. Notwithstanding the foregoing, the directors did not receive stock options on the date of the 2024 annual meeting of our stockholders, and in lieu thereof, in January 2025, the directors, other than the chairman of the Board, received options to purchase an aggregate of 189 shares of Common Stock and the chairman of the Board received options to purchase 109 shares of Common Stock, all of which vested at the time of grant.
In addition to any other consideration received, our amended and restated non-employee director compensation program provides that non-employee Board members serving as a chairperson will receive the following additional consideration:
• The audit committee chairperson will receive an additional annual retainer of $15,000.
• The compensation committee chairperson will receive an additional annual retainer of $12,000.
• The nominating and corporate governance committee chairperson will receive an additional annual retainer of $10,000.
• The Board chairperson will receive an additional annual retainer of $30,000.
A non-employee director may instead elect to receive annual retainer for serving as a chairperson in an award of a stock option in lieu of cash.
Director Compensation
The following table provides information on compensation paid to our non-employee directors in 2025:
Fees Earned or Paid in Cash ($)
Option Awards ($) (1)(2)
Total ($)
David Baker
40,000 66,690 106,690
Roelof Rongen
57,500 66,690 124,190
Camilla V. Simpson, M.Sc.
64,500 66,690 131,190
David Szekeres
91,000 113,173 204,173
(1) Reflects the aggregate grant date fair value of stock options granted during the fiscal year calculated in accordance with FASB ASC Topic 718. These amounts do not necessarily correspond to the actual value that may be realized by the executive in connection with the option awards. The assumption made in valuing the option awards reported in this column are described in the Company’s audited consolidated financial statements (Note 3. Summary of Significant Accounting Policies and Note 9. Stock Based Compensation ) included in this Annual Report. Following the 2025 annual meeting of stockholders, Messrs. Baker and Rongen and Ms. Simpson were granted a stock option to purchase 161 shares, and Mr. Szekeres was granted a stock option to purchase 269 shares,
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each with an exercise price equal to $36.40 The shares underlying the stock options vest subject to the director’s continued service through the applicable vesting dates.
(2) The following table shows the aggregate number of outstanding shares of Common Stock underlying outstanding option awards held by our non-employee directors as of December 31, 2025.
Name Outstanding Option Awards
David Baker
1,281
Roelof Rongen
1,281
Camilla V. Simpson, M. Sc.
1,281
David Szekeres
2,169
Policies and Procedures Related to the Grant of Certain Equity Awards
We do not purposefully time our grants to coincide or be near in time to the release of material non-public information (MNPI), and we do not time the release of material nonpublic information based on equity award grant dates. However, from time to time, we may grant options close in time to the release of MNPI to the extent those options are being granted upon the hiring of new executive officers and in connection with annual grants being made as part of our director compensation policy, upon appointment of a new director and on an annual basis at each annual meeting.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
The following table sets forth certain information known to us regarding beneficial ownership of our capital stock as of January 17, 2026 for:
• each person or group of affiliated persons known by us to be the beneficial owner of more than five percent of our capital stock;
• each of our named executive officers;
• each of our directors; and
• all of our executive officers, and directors as a group.
We have determined beneficial ownership in accordance with the rules and regulations of the SEC, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under those rules, beneficial ownership includes any shares as to which the individual or entity has sole or shared voting power or investment power, and includes securities that the individual or entity has the right to acquire, such as through the exercise of stock options, within 60 days of January 17, 2026. Except as noted by footnote, and subject to community property laws where applicable, we believe, based on the information provided to us, that the persons and entities named in the table below have sole voting and investment power with respect to all Common Stock shown as beneficially owned by them.
The percentage of beneficial ownership in the table below is based on 536,747 shares of Common Stock deemed to be outstanding as of January 17, 2026.
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Common Stock Beneficially Owned
Name and Address of Beneficial Owner Number of Shares of Beneficial Ownership
Percentage of Total Common Stock
Greater Than 5% Stockholders
Intracoastal Capital LLC (1)
58,344 9.99 %
Lincoln Alternative Strategies LLC (2)
42,776 7.97 %
Directors and Named Executive Officers (3)
W. Marc Hertz, Ph.D. (4)
3,778 *
Leanne Kelly (5)
1,489 *
Vipin Kumar, Ph.D. (6)
1,492 *
David Baker (7)
1,004 *
Roelof Rongen (8)
1,004 *
Camilla V. Simpson, M.Sc. (8)
1,004 *
David Szekeres (9)
1,690 *
All directors and executive officers as a group (8 persons) (10)
11,464 2.09 %
* Represents beneficial ownership of less than one percent of our outstanding Common Stock.
(1) Pursuant to a Schedule 13G filed on December 17, 2025 by Intracoastal Capital LLC (“Intracoastal”), Mitchell P. Kopin and Daniel B. Asher, consists of (i) 11,356 shares of Common Stock held by Intracoastal and (ii) 46,988 shares of Common Stock issuable upon exercise of Series F Common Warrants held by Intracoastal. The shares of Common Stock issuable upon exercise of the Series F Common Warrants are subject to limitations on exercise if such exercise would result in the holder beneficially owning more than 9.99% of our issued and outstanding Common Stock. The address of Mr. Kopin and Intracoastal is 245 Palm Trail, Delray Beach, Florida 33483. The address of Mr. Asher is 1011 Lake Street, Suite 311, Oak Park, Illinois 60301.
(2) Pursuant to a Schedule 13G filed on December 29, 2025, consists of 42,776 shares of Common Stock held by Lincoln Alternative Strategies LLC (“Lincoln”). The address of Lincoln is 404 Washington Ave., Suite 650, Miami Beach, FL 33139.
(3) Except as otherwise noted below, the address of the beneficial owner is c/o GRI Bio, Inc. 2223 Avenida de la Playa, Suite 208, La Jolla, CA 92037.
(4) Consists of (i) 8 shares of Common Stock and (ii) 3,770 shares of Common Stock issuable pursuant to stock options exercisable within 60 days of January 17, 2026.
(5) Consists of 1,489 shares of Common Stock issuable pursuant to stock options exercisable within 60 days of January 17, 2026.
(6) Consists of (i) 3 shares of Common Stock and (ii) 1,489 shares of Common Stock issuable pursuant to stock options exercisable within 60 days of January 17, 2026.
(7) Consists of 1,004 shares of Common Stock issuable pursuant to stock options exercisable within 60 days of January 17, 2026.
(8) Consists of 1,004 shares of Common Stock issuable pursuant to stock options exercisable within 60 days of January 17, 2026.
(9) Consists of 1,690 shares of Common Stock issuable pursuant to stock options exercisable within 60 days of January 17, 2026.
(10) Consists of (i) the shares of Common Stock described in footnotes (2) through (6) above and (ii) 3 shares of Common Stock held by Albert Agro, Ph.D.
Equity Compensation Plan Information
The following table sets forth information regarding our equity compensation plans as of December 31, 2025:
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))
Plan category (a) (b) (c)
Equity compensation plans approved by security holders (1)
15,032 $ 68.44 19,919 (2)
Equity compensation plans not approved by security holders — — —
Total
15,032 19,919
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(1) The number of shares of our Common Stock authorized under the A&R 2018 Plan automatically increases on January 1st of each year until the expiration of the A&R 2018 Plan, in an amount equal to four percent of the total number of shares of our Common Stock outstanding on December 31st of the preceding calendar year, subject to the discretion of our Board or compensation committee to determine a lesser number of shares shall be added for such year. This total does not reflect the automatic increase in the number of shares available for issuance under the A&R 2018 Plan that was effective on January 1, 2026 pursuant to the evergreen provisions.
(2) Includes shares of our Common Stock under the A&R 2018 Plan. For a description of this plan, refer below and to Note 8. “ Stock Based Compensation” to the financial statements included in this Annual Report.
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Description of Amended and Restated GRI Bio, Inc. 2018 Equity Incentive Plan, as Amended
On April 21, 2023, the stockholders of the Company approved the A&R 2018 Plan. On July 7, 2025, the Board approved an amendment to the A&R 2018 Plan to increase the amount of shares authorized for issuance thereunder by 14,285 shares, which was subsequently approved by the stockholders of the Company on August 13, 2025. The A&R 2018 Plan provides for the grant of incentive stock options, nonstatutory stock options, restricted stock, performance units, performance shares, restricted stock units and other stock-based awards to our employees, directors and consultants. The purpose of the A&R 2018 Plan is to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentive to our employees, directors and consultants and to promote the success of our business. The A&R 2018 Plan provides for an annual increase on the first day of each calendar year beginning January 1, 2025 and ending on and including January 1, 2033, equal to the less of (x) 4% of the aggregate number of shares outstanding on the final day of the immediately preceding calendar year and (y) such smaller number of shares as is determined by the Board. The A&R 2018 Plan further authorizes the administrator to amend the exercise price and terms of certain awards thereunder.
As currently in effect, 34,951 shares of our Common Stock are reserved for issuance pursuant to the A&R 2018 Plan, of which 15,032 are subject to issued and outstanding awards.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
The following is a summary of each transaction or series of similar transactions since January 1, 2024, to which we have been a party that:
• The amount involved exceeded or exceeds $120,000 or is greater than 1% of the average of our total assets as of December 31, 2025 and 2024; and
• any of our directors or executive officers, any holder of 5% of our capital stock or any member of their immediate family had or will have a direct or indirect material interest.
Employment Agreements
We have entered into employment agreements with each of our executive officers. See Item 11. “ Executive Compensation. ”
Equity Grants
We have granted stock options to each of our executive officers and members of our Board. See Item 11. “ Executive Compensation. ”
Indemnification and Limitation on Liability
Section 145 of the DGCL (Section 145) authorizes a corporation to indemnify its directors and officers against liabilities arising out of actions, suits and proceedings to which they are made or threatened to be made a party by reason of the fact that they have served or are currently serving as a director or officer to a corporation. The indemnity may cover expenses (including attorneys’ fees) judgments, fines and amounts paid in settlement actually and reasonably incurred by the director or officer in connection with any such action, suit or proceeding. In addition, Section 145 provides that a corporation has the power to purchase and maintain insurance on behalf of its directors and officers against any liability asserted against them and incurred by them in their capacity as a director or officer, or arising out of their status as such, whether or not the corporation would have the power to indemnify the director or officer against such liability under Section 145.
We have adopted provisions in our amended and restated certificate of incorporation and our amended and restated bylaws that limit or eliminate the personal liability of our directors to the fullest extent permitted by the DGCL, as it now exists or may in the future be amended. Consequently, a director will not be personally liable to us or our stockholders for monetary damages or breach of fiduciary duty as a director, except for liability for:
• any breach of the director’s duty of loyalty to us or our stockholders;
• any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;
• any unlawful payments related to dividends or unlawful stock purchases, redemptions or other distributions; or
• any transaction from which the director derived an improper personal benefit.
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These limitations of liability do not alter director liability under the federal securities laws and do not affect the availability of equitable remedies such as an injunction or rescission.
In addition, our amended and restated bylaws provide that:
• we will indemnify our directors, officers and, in the discretion of our Board, certain employees to the fullest extent permitted by the DGCL, as it now exists or may in the future be amended; and
• we will advance reasonable expenses, including attorneys’ fees, to our directors and, in the discretion of our Board, to our officers and certain employees, in connection with legal proceedings relating to their service for or on behalf of us, subject to limited exceptions.
We have entered into indemnification agreements with each of our directors and officers. These agreements provide that we will indemnify each of our directors, our executive officers and, at times, their affiliates to the fullest extent permitted by Delaware law. We will advance expenses, including attorneys’ fees (but excluding judgments, fines and settlement amounts), to each indemnified director, executive officer or affiliate in connection with any proceeding in which indemnification is available and we will indemnify our directors and officers for any action or proceeding arising out of that person’s services as a director or officer brought on behalf of us or in furtherance of our rights. Additionally, certain of our directors or officers may have certain rights to indemnification, advancement of expenses or insurance provided by their affiliates or other third parties, which indemnification relates to and might apply to the same proceedings arising out of such director’s or officer’s services as a director referenced herein. Nonetheless, we have agreed in the indemnification agreements that our obligations to those same directors or officers are primary and any obligation of such affiliates or other third parties to advance expenses or to provide indemnification for the expenses or liabilities incurred by those directors are secondary.
Policies and Procedures for Related Party Transactions
We have adopted a written policy that requires all future transactions between us and any director, executive officer, holder of 5% or more of any class of our capital stock or any member of the immediate family of, or entities affiliated with, any of them, or any other related persons, as defined in Item 404 of Regulation S-K, or their affiliates, in which the amount involved is equal to or greater than the threshold amount proscribed by Item 404 of Regulation S-K, be approved in advance by our Audit Committee. Any request for such a transaction must first be presented to our Audit Committee for review, consideration and approval. In approving or rejecting any such proposal, our Audit Committee is to consider the relevant facts and circumstances available and deemed relevant to the Audit Committee, including, but not limited to, the extent of the related party’s interest in the transaction, and whether the transaction is on terms no less favorable to us than terms we could have generally obtained from an unaffiliated third party under the same or similar circumstances.
Director Independence
See Item 10. “ Directors, Executive Officers and Corporate Governance Management — Director Independence .”
Committees of our Board of Directors
Our Board has established an audit committee, a compensation committee and a nominating and corporate governance committee, each of which operates pursuant to a written charter adopted by our Board. See Item 10. “ Directors, Executive Officers and Corporate Governance Management — Committees of the Board of Directors .”
Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Our independent registered public accounting firm is WithumSmith+Brown, PC , San Francisco, California , Auditor Firm ID: 100 .
On April 11, 2025, the audit committee of the Board dismissed Sadler as our independent registered public accounting firm and appointed Withum as our independent registered public accounting firm for the fiscal year ending December 31, 2025. The
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dismissal was not related to any disagreement with Sadler on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure.
The following table represents aggregate fees incurred for Withum services during the year ended December 31, 2025 by us.
December 31,
2025
Audit Fees (1)
$ 397,858
Audit Related Fees (2)
—
Tax Fees (3)
—
All Other Fees (4)
—
Total $ 397,858
(1) Audit Fees represent the aggregate fees billed for professional services rendered by our independent registered public accounting firm for the audit of our annual financial statements, review of financial statements included in our quarterly reports or services that are normally provided in connection with statutory and regulatory filings or engagements for those fiscal years as well as the issuance of consents in connection with registration statement filings with the SEC and comfort letters in connection with securities offerings.
(2) Audit Related Fees represent the aggregate fees billed for assurance and related professional services rendered by our independent registered public accounting firm that are reasonably related to the performance of the audit or review of our financial statements and are not reported under "Audit Fees."
(3) Tax Fees represent the aggregate fees billed for professional services rendered by our independent registered public accounting firm for tax compliance, tax advice and tax planning services.
(4) All Other Fees represent the aggregate fees billed for all other products and services rendered by our independent registered public accounting firm other than the services reported in the other categories.
The following table represents aggregate fees incurred for Sadler services during the years ended December 31, 2025 and 2024 by us.
December 31,
2025 2024
Audit Fees (1)
$ 82,500 $ 194,325
Audit Related Fees (2)
— —
Tax Fees (3)
— —
All Other Fees (4)
— —
Total $ 82,500 $ 194,325
(1) Audit Fees represent the aggregate fees billed for professional services rendered by our independent registered public accounting firm for the audit of our annual financial statements, review of financial statements included in our quarterly reports or services that are normally provided in connection with statutory and regulatory filings or engagements for those fiscal years as well as the issuance of consents in connection with registration statement filings with the SEC and comfort letters in connection with securities offerings.
(2) Audit Related Fees represent the aggregate fees billed for assurance and related professional services rendered by our independent registered public accounting firm that are reasonably related to the performance of the audit or review of our financial statements and are not reported under "Audit Fees."
(3) Tax Fees represent the aggregate fees billed for professional services rendered by our independent registered public accounting firm for tax compliance, tax advice and tax planning services.
(4) All Other Fees represent the aggregate fees billed for all other products and services rendered by our independent registered public accounting firm other than the services reported in the other categories.
The audit committee will approve in advance the engagement and fees of the independent registered public accounting firm for all audit services and non-audit services, based upon independence, qualifications and, if applicable, performance. The audit committee may form and delegate to subcommittees of one or more members of the audit committee the authority to grant pre-approvals for audit and permitted non-audit services, up to specific amounts. All audit services provided by Withum and Sadler for the periods presented were approved by our audit committee and ratified by our Board.
Pre-Approval of Audit and Non-Audit Services
Our audit committee has adopted policies and procedures relating to the approval of all audit and non-audit services that are to be performed by our independent registered public accounting firm. These policies and procedures generally provide that we will not engage our registered public accounting firm to render audit or non-audit services unless the service is specifically approved in advance by our audit committee or the engagement is entered into pursuant to one of the pre-approval procedures described below.
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From time to time, our audit committee may pre-approve specified types of services that are expected to be provided to us by our independent registered public accounting firm during the next twelve months. Any such pre-approval is detailed as to the particular service or type of services to be provided and is also generally subject to a maximum dollar amount.
Consistent with requirements of the SEC and the Public Company Accounting Oversight Board regarding auditor independence, our audit committee is responsible for the appointment, compensation and oversight of the work of our independent registered public accounting firm. In recognition of this responsibility, our audit committee, or the chairperson if such approval is needed between meetings of the audit committee, pre-approves all audit and permissible non-audit services provided by the independent registered public accounting firm. These services may include audit services, audit-related services, tax services and other services.
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PART IV
Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
(a) The following documents are filed as part of this report:
(1) Financial Statements . The financial statements of the Company, together with the reports thereon of WithumSmith+Brown, PC and Sadler, Gibb & Associates LLC, independent registered public accounting firms, are included in this Annual Report beginning on page F-1.
(2) Financial Statement Schedules . All schedules have been omitted because the information required to be set forth therein is not applicable or is shown in the financial statements or notes thereto.
(3) Exhibits. See (b) below.
(b) Exhibits
The exhibits listed in the Exhibit Index below are filed or incorporated by reference as part of this Annual Report.
Incorporated by Reference
Exhibit No. Description Filed Herewith Form Date File Number
2.1△ Agreement and Plan of Merger, by and among the Company, Vallon, and Vallon Merger Sub, Inc. , dated as of December 13, 2022 .
8-K 12/13/22 001-40034
2.2 Amendment to Agreement and Plan of Merger, by and among the Company, Vallon, and Vallon Merger Sub, Inc., dated as of February 17, 2023.
S-4/A 02/24/23 333-268977
3.1
Amended and Restated Certificate of Incorporation, as amended.
X
3.2
Amended and Restated Bylaws .
8-K/A 05/26/23 001-40034
4.1
Specimen Common Stock Certificate.
S-1 10/23/20 333-249636
4.2△
Registration Rights Agreement, by and between Vallon and the investor party thereto, dated December 13, 2022.
8-K 12/13/22
001-40034
4.3
Form of Common Stock Purchase Warrant.
8-K
5/13/22
001-40034
4.4
Form of Amendment No. 1 to Common Stock Purchase Warrant.
8-K 07/26/22 001-40034
4.5
Form of Equity Warrant.
8-K 12/13/22 001-40034
4.6
Form of Exchange Warrant.
8-K 12/13/22 001-40034
4.7
Form of Senior Secured Note of GRI Bio Operations, Inc.
S-4
12/23/22
333-268977
4.8
Warrant to Purchase Stock issued to TEP Biotech, LLC, dated as of November 2, 2018.
S-4 12/23/22 333-268977
4.9
Warrant to Purchase Stock issued to TEP Biotech, LLC, dated as of December 3, 2019.
S-4 12/23/22 333-268977
4.10
Warrant to Purchase Stock issued to TEP Biotech, LLC, dated as of July 7, 2022.
S-4 12/23/22 333-268977
4.11
Warrant to Purchase Stock issued to Oppel Greeff, dated as of July 7, 2022.
S-4 12/23/22 333-268977
4.12
Form of Amendment to 2022 Warrant to Purchase Stock.
S-4/A 01/30/23
333-268977
4.13
Form of Series B-1 Common Warrant.
S-1/A 01/31/24 333-276025
4.14
Form of Series B-2 Common Warrant.
S-1/A 01/31/24 333-276025
4.15
Form of Placement Agent Warrant .
S-1/A
06/26/24
333-280323
4.16
Form of Series C-1 Common Warrant.
S-1/A
06/26/24
333-280323
4.17
Form of Series C-2 Common Warrant.
S-1/A
06/26/24
333-280323
4.18
Form of Placement Agent Warrant.
8-K
10/22/24
001-40034
4.19
Form of Series D-1 Common Warrant.
8-K
10/22/24
001-40034
4.20
Form of Series D-2 Common Warrant.
8-K
10/22/24
001-40034
4.21
Form of Placement Agent Warrant.
S-1
03/24/25
333-286072
4.22
Form of Pre-Funded Warrant.
S-1
03/24/25
333-286072
4.23
Form of Series E Warrant.
S-1
03/24/25
333-286072
4.24
Form of Placement Agent Warrant.
S-1
12/08/25
333-291999
4.25
Form of Pre-Funded Warrant.
S-1
12/08/25
333-291999
4.26
Form of Series F Warrant.
S-1
12/08/25
333-291999
4.27
Description of Securities.
10-K
03/15/25 001-40034
10.1#
Company's A&R 2018 Equity Incentive Plan, as Amended.
8-K
08/13/25 001-40034
10.2#
Form of Nonqualified Stock Option Agreement under the Company’s A&R 2018 Equity Incentive Plan.
S-1 10/23/20 333-249636
10.3#
Form of Incentive Stock Option Agreement under the Company ’s A &R 2018 Equity Incentive Plan.
S-1 10/23/20 333-249636
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10.4#
Form of Restricted Stock Unit Agreement under the Registrant’s Amended and Restated 2018 Equity Incentive Plan.
S-8
08/13/25 333-289593
10.5#
Amended and Restated Non-Employee Director Compensation Policy .
10-Q
08/14/25 8/14/2025
10.6
License Agreement, by and between the Company and MEDICE Arzneimittel Putter GmbH & Co. KG, dated as of January 6, 2020.
S-1 10/23/20 333-249636
10.7△
Form of Securities Purchase Agreement.
8-K 05/13/22 001-40034
10.8△
Amendment No. 1 to Securities Purchase Agreement, by and between Vallon and each purchaser identified on the signature pages thereto, dated as of July 25, 2022.
8-K 07/26/22 001-40034
10.9#
Consulting and Clinical Advisory Board Agreement, by and between the Company and Rohit Loomba, M.D., dated as of June 3, 2016.
S-4 12/23/22 333-268977
10.10#
Consulting and Scientific Advisory Board Agreement, by and between the Company and Vipin Kumar Chaturvedi, personally or through Vidur Discoveries LLC, dated as of October 31, 2018.
S-4 12/23/22 333-268977
10.11
Securities Purchase Agreement, by and between the Company and Altium Growth Fund, LP, dated as of December 13, 2022.
8-K 12/13/22 001-40034
10.12
Securities Purchase Agreement, by and among the Company, Vallon and Altium Growth Fund, LP, dated as of December 13, 2022.
8-K 12/13/22 001-40034
10.13
Omnibus Amendment to Securities Purchase Agreements, by and among the Company, GRI Bio Operations, Inc., and Altium Growth Fund, LP, dated as of February 17, 2023.
S-4 03/06/23 333-268977
10.14△
Lease Agreement, by and between La Jolla Shores Plaza, LLC and GRI Bio Operations, Inc., dated as of March 2, 2018, for that property located at 2223 Avenida de la Playa, Suite 208, La Jolla, California, 92037, as amended on February 16, 2021 and February 20, 2024.
10-K
03/28/24 001-40034
10.15#
Form of Indemnification Agreement.
8-K 04/21/23 001-40034
10.16#
Employment Agreement, by and between GRI Bio Operations, Inc. and Marc Hertz, Ph.D., dated as of February 20, 2023.
S-4/A 02/24/23 333-268977
10.17#
Employment Agreement, by and between GRI Bio Operations, Inc. and Leanne M. Kelly, dated as of February 20, 2023.
S-4/A 02/24/23 333-268977
10.18#
Employment Agreement, by and between GRI Bio Operations, Inc. and Vipin Kumar Chaturvedi, dated as of February 20, 2023.
S-4/A 02/24/23 333-268977
10.19#
Separation Agreement, by and between the Company and David Baker, dated as of April 21, 2023.
8-K 04/21/23 001-40034
10.20#
Employment Agreement, by and between the Company and Albert Agro, Ph.D., dated as of July 1, 2023.
10-Q 08/14/23 001-40034
10.21△
Asset Purchase Agreement, by and between the Company and Aardvark Therapeutics, Inc., dated as of August 22, 2023.
8-K 08/23/23 001-40034
10.22△
Form of Securities Purchase Agreement.
S-1/A 01/31/24 333-276025
10.23
Form of Placement Agent Agreement.
S-1/A 01/31/24 333-276025
10.24△
Form of Securities Purchase Agreement.
S-1/A
06/26/24
333-280323
10.25
Form of Repricing Letter Agreement.
8-K
10/22/24
001-40034
10.26
At The Market Offering Agreement, dated May 20, 2024, by and between GRI Bio, Inc. and H.C. Wainwright & Co., LLC
8-K
5/20/24
001-40034
10.27△
Form of Securities Purchase Agreement.
S-1
03/24/25
333-286072
10.28△
Form of Securities Purchase Agreement .
S-1
12/08/25
333-291999
10.29
Engagement Letter, dated October 21, 2024, by and between GRI Bio, Inc. and H.C. Wainwright & Co., LLC, as amended on December 5, 2025.
S-1/A 12/9/25
333-291999
16.1
Letter from Sadler Gibb & Associates LLC, dated April 15, 2025.
8-K
04/15/25 001-40034
19.1
I nsider Trading Policy.
10-K
03/15/25 001-40034
21.1
Subsidiaries .
S-1/A 12/04/23 333-274972
23.1 Consent of WithumSmith+ Brown , PC .
X
23.2
Consent of Sadler Gibb and Associates, LLC.
X
24.1
Powers of Attorney for directors and certain executive officers (contained on the signature page).
31.1
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15a-14(a) under the Exchange Act.
X
31.2
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15a-14(a) under the Exchange Act .
X
32.1+ Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 .
X
32.2+ Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 .
X
97.1
Clawback Policy.
10-Q 11/14/23 001-40034
101.INS
XBRL Instance Document
101.SCH
XBRL Taxonomy Extension Schema Linkbase Document
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101.CAL
XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF
XBRL Taxonomy Extension Definition Linkbase Document
101.LAB
XBRL Taxonomy Extension Label Linkbase Document
101.PRE
XBRL Taxonomy Extension Presentation Linkbase Document
104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
__________________
Unless otherwise indicated, exhibits are filed herewith.
△ Schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company undertakes to furnish supplemental copies of any of the omitted schedules upon request by the U.S. Securities and Exchange Commission.
# Indicates a management contract or any compensatory plan, contract or arrangement.
+ The certification attached as Exhibit 32.1 that accompany this Annual Report on Form 10-K is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of the Registrant under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Annual Report on Form 10-K, irrespective of any general incorporation language contained in such filing.
Item 16. Form 10-K Summary
None.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized.
GRI BIO, INC.
Date: January 30, 2026 By: /s/ W. Marc Hertz, Ph.D.
Name: W. Marc Hertz, Ph.D.
Title: President and Chief Executive Officer
SIGNATURES AND POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints W. Marc Hertz, Ph.D. and Leanne Kelly as his or her true and lawful attorneys-in-fact and agents, each with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K and to file the same, with all exhibits thereto and all documents in connection therewith, with the U.S. Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that such attorneys-in-fact and agents or any of them, or his or her or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Signature Title Date
/s/ W. Marc Hertz, Ph.D. President, Chief Executive Officer and Director
(Principal Executive Officer)
January 30, 2026
W. Marc Hertz, Ph.D.
/s/ Leanne Kelly Chief Financial Officer
(Principal Financial and Accounting Officer)
January 30, 2026
Leanne Kelly
/s/ David Szekeres Director, Chair of the Board January 30, 2026
David Szekeres
/s/ David Baker Director January 30, 2026
David Baker
/s/ Roelof Rongen Director January 30, 2026
Roelof Rongen
/s/ Camilla V. Simpson, M.Sc. Director January 30, 2026
Camilla V. Simpson, M.Sc.
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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Report of Independent Registered Public Accounting Firm, WithumSmith+Brown, PC PCAOB ID NO: 100
F- 2
Report of Independent Registered Public Accounting Firm, Sadler Gibb PCAOB ID NO: 3627
F- 3
Consolidated Balance Sheets as of December 31, 2025 and December 31, 2024
F- 4
Consolidated Statements of Operations for the years ended December 31, 2025 and 2024
F- 5
Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 31, 2025 and 2024
F- 6
Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024
F- 7
Notes to Consolidated Financial Statements
F- 8
F-1
Table of Contents
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of
GRI Bio, Inc.
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheet of GRI Bio, Inc. (the "Company") as of December 31, 2025, the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
Going Concern
The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company has an accumulated deficit at December 31, 2025 and, since inception, has incurred operating losses and negative cash flows from operations. The Company’s cash and cash equivalents as of December 31, 2025 are not sufficient to fund the Company’s planned operations for a period of twelve months from the date the consolidated financial statements are issued. Accordingly, the Company has determined that its planned operations raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion.
/s/ WithumSmith+Brown, PC
We have served as the Company's auditor since 2025.
San Francisco, California
January 29, 2026
PCAOB ID Number 100
F-2
Table of Contents
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders of GRI Bio, Inc.:
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheet of GRI Bio, Inc. (“the Company”) as of December 31, 2024, the related consolidated statement of operations, changes in stockholders’ equity (deficit), and cash flows for the year ended December 31, 2024 and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024, and the results of its operations and its cash flows for the year ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
/s/ Sadler, Gibb & Associates, LLC
We served as the Company’s auditor from 2022 to 2024.
Draper, UT
March 14, 2025, except for the effect of the reverse stock split effected January 15, 2026, described in Note 1, as to which the date is January 29, 2026
F-3
Table of Contents
GRI Bio, Inc.
Consolidated Balance Sheets
(in thousands, except share and per share amounts)
December 31,
2025 2024
Assets
Current assets:
Cash and cash equivalents $ 8,229 $ 5,028
Prepaid expenses and other current assets 363 587
Total current assets 8,592 5,615
Property and equipment, net 3 4
Operating lease right-of-use assets 71 120
Total assets $ 8,666 $ 5,739
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 1,837 $ 897
Accrued expenses 750 691
Operating lease liabilities, current 56 48
Total current liabilities 2,643 1,636
Operating lease liabilities, non-current 15 71
Total liabilities 2,658 1,707
Commitments and contingencies (Note 10)
Stockholders' equity:
Common stock, $ 0.0001 par value; 250,000,000 shares authorized; 497,693 and 18,768 shares issued and outstanding as of December 31, 2025 and 2024, respectively
— —
Additional paid-in-capital 57,704 43,772
Accumulated deficit ( 51,696 ) ( 39,740 )
Total stockholders' equity
6,008 4,032
Total liabilities and stockholders' equity
$ 8,666 $ 5,739
See accompanying notes to consolidated financial statements.
F-4
Table of Contents
GRI Bio, Inc.
Consolidated Statements of Operations
(in thousands, except share and per share amounts)
Year Ended December 31,
2025 2024
Operating expenses:
Research and development $ 6,819 $ 3,768
General and administrative 5,158 4,467
Total operating expenses 11,977 8,235
Loss from operations ( 11,977 ) ( 8,235 )
Change in fair value of warrant liability — 3
Interest income 21 25
Net loss $ ( 11,956 ) $ ( 8,207 )
Deemed dividend on Series B Warrants — ( 1,911 )
Net loss available to common stockholders $ ( 11,956 ) $ ( 10,118 )
Net loss per share attributable to common stockholders, basic and diluted $ ( 121.80 ) $ ( 1,545.55 )
Weighted-average common shares outstanding, basic and diluted 98,162 6,547
See accompanying notes to consolidated financial statements.
F-5
Table of Contents
GRI Bio, Inc.
Consolidated Statements of Changes in Stockholders’ Equity
(in thousands, except shares)
Common Stock Additional
Paid-in Capital Accumulated
Deficit Stockholders’
Equity
Shares Amount
Balance, December 31, 2023 104 $ — $ 31,792 $ ( 31,533 ) $ 259
Stock-based compensation expense — — 148 — 148
Warrant exercise
6,855 — 666 — 666
Issuance of common stock
11,809 — 11,166 — 11,166
Net loss
— — — ( 8,207 ) ( 8,207 )
Balance, December 31, 2024
18,768 $ — $ 43,772 $ ( 39,740 ) $ 4,032
Stock-based compensation expense — — 793 — 793
Fractional share adjustment ( 5 ) — ( 1 ) — ( 1 )
Issuance of common stock and prefunded warrants, net of issuance costs 430,555 — 10,750 — 10,750
Issuance of common stock 48,375 — 2,390 — 2,390
Net loss — — — ( 11,956 ) ( 11,956 )
Balance, December 31, 2025 497,693 $ — $ 57,704 $ ( 51,696 ) $ 6,008
See accompanying notes to consolidated financial statements.
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GRI Bio, Inc.
Consolidated Statements of Cash Flows
(in thousands)
Year Ended December 31,
2025 2024
Cash flows from operating activities:
Net loss $ ( 11,956 ) $ ( 8,207 )
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation expense 4 4
Stock-based compensation expense 793 148
Change in fair value of warrant liability — ( 3 )
Change in operating lease right of use assets 48 ( 105 )
Change in operating assets and liabilities:
Prepaid expenses and other current assets 251 313
Accounts payable 663 ( 387 )
Accrued expenses 59 ( 479 )
Operating lease liabilities ( 48 ) 105
Cash used in operating activities ( 10,186 ) ( 8,611 )
Investing activities:
Purchase of property and equipment ( 3 ) —
Cash used in investing activities ( 3 ) —
Financing activities:
Proceeds from issuance of common stock in financing transactions 13,000 9,499
Proceeds from issuance of common stock under ATM facility 2,560 3,604
Proceeds from warrant exercise — 762
Payment for fractional shares in connection with reverse stock split ( 1 ) ( 1 )
Payment of deferred stock issuance costs ( 2,169 ) ( 2,033 )
Cash provided by financing activities 13,390 11,831
Net increase in cash and cash equivalents 3,201 3,220
Cash and cash equivalents at beginning of year
5,028 1,808
Cash and cash equivalents at end of year
$ 8,229 $ 5,028
Supplemental disclosure or noncash activities:
Stock issuance costs included in accounts payable $ 278 $ —
Issuance of warrants for payment of stock issuance costs $ 440 $ 287
See accompanying notes to consolidated financial statements
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
1. ORGANIZATION AND DESCRIPTION OF BUSINESS
GRI Bio, Inc. (GRI or the Company), based in La Jolla, CA, was incorporated in Delaware in May 2009, which is the date of inception.
GRI is a clinical-stage biopharmaceutical company focused on discovering, developing, and commercializing innovative therapies that target serious diseases associated with dysregulated immune responses leading to inflammatory, fibrotic and autoimmune disorders. The Company’s goal is to be an industry leader in developing therapies to treat these diseases and to improve the lives of patients suffering from such diseases. The Company’s product candidate, GRI-0621, is an oral inhibitor of type 1 invariant Natural Killer T cells and is being developed for the treatment of severe fibrotic lung diseases such as idiopathic pulmonary fibrosis (IPF). The Company’s product candidate portfolio also includes GRI-0803 and a proprietary library of 500+ compounds. GRI-0803, the lead molecule selected from the library, is a novel oral agonist of type 2 diverse Natural Killer T cells and is being developed for the treatment of autoimmune disorders, with much of its preclinical work in Systemic Lupus Erythematosus Disease or lupus and multiple sclerosis (MS).
Reverse Stock Splits
On January 29, 2024, the Company effected a reverse stock split of its common stock at a ratio of one-for-seven (the January 2024 Reverse Stock Split). On June 17, 2024, the Company effected a reverse stock split of its Common Stock at a ratio of one-for-thirteen (the June 2024 Reverse Stock Split). On February 21, 2025, the Company effected a reverse stock split of its Common Stock at a ratio of one-for-seventeen (the February 2025 Reverse Stock Split). On January 23, 2026, the Company effected a reverse stock split of its common stock at a ratio of one-for-twenty-eight (the January 2026 Reverse Stock Split, and together with the February 2025 Reverse Stock Split, the January 2024 Reverse Stock Split and the June 2024 Reverse Stock Split, the Reverse Stock Splits). Unless otherwise noted, all references to share and per share amounts in these consolidated financial statements reflect the Reverse Stock Splits.
2. LIQUIDITY
These consolidated financial statements have been prepared on the basis that the Company is a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not generated any significant revenues from operations since inception and does not expect to do so in the foreseeable future. The Company has incurred operating losses since its inception in 2009 and as a result has incurred $ 51,696 in accumulated deficit through December 31, 2025. The Company has financed its working capital requirements to date through the issuance of equity and debt securities. As of December 31, 2025, the Company had cash of approximately $ 8,229 .
On February 1, 2024, the Company entered into a securities purchase agreement (the February 2024 Purchase Agreement), pursuant to which the Company issued and sold Common Stock, pre-funded warrants and common warrants in a public offering (the February 2024 Offering) for net proceeds of $ 4,389 , after deducting offering expenses of $ 1,110 .
On May 20, 2024, the Company entered into an At The Market Offering Agreement (the Sales Agreement) with H.C. Wainwright & Co., LLC (Wainwright), pursuant to which the Company may sell and issue, subject to the limitations in the Sales Agreement, up to $ 10.0 million shares of Common Stock from time to time through Wainwright as its sales agent (the ATM Offering). Under the Sales Agreement, Wainwright is entitled to compensation of 3.0 % of the gross offering proceeds of all shares of Common Stock sold through it pursuant to the Sales Agreement. As of December 31, 2025, the Company has sold 60,003 shares of Common Stock in the ATM Offering at a weighted-average price of $ 102.75 per share, raising $ 6,165 of gross proceeds and net proceeds of $ 5,858 , after deducting commissions to the sales agent and other ATM Offering related expenses.
On January 9, 2026, the Company filed a prospectus supplement to its registration statement on Form S-3 (File No. 333-279348) to increase the amount of shares of Common Stock that the Company may offer and sell under the Sales Agreement and applicable registration statement to an aggregate offering price of up to $ 7,380 , which amount does not include the shares of Common Stock having an aggregate gross sales price of approximately $ 6,165 that were sold under the ATM Offering through January 8, 2026, in accordance with the limitations set forth in Instruction I.B.6 of Form S-3. Since December 31, 2025, the Company has sold 947,342 shares of Common Stock with an aggregate gross sales price of $ 6,474 .
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
On June 26, 2024, the Company entered into a securities purchase agreement (the June 2024 Purchase Agreement), pursuant to which the Company issued and sold Common Stock, pre-funded warrants and common warrants, in a public offering (the June 2024 Offering), for net proceeds of $ 3,172 , after deducting offering expenses of $ 1,057 .
On October 21, 2024, the Company entered into letter agreements (the Repricing Letter Agreements) with certain holders (the Holders) of its issued and outstanding common warrants to purchase shares of its Common Stock, pursuant to which these Holders exercised their common warrants for cash at a reduced exercise price. In addition, these Holders received new unregistered common warrants. The net proceeds to the Company from the exercise of the common warrants were $ 608 after deducting placement agent fees and offering expenses of $ 154 .
On April 1, 2025, the Company entered into a securities purchase agreement (the April 2025 Purchase Agreement), pursuant to which the Company issued and sold Common Stock, pre-funded warrants and common warrants, in a public offering (the April 2025 Offering), for net proceeds of $ 4,020 , after deducting offering expenses of $ 979 .
On December 12, 2025, the Company entered into a securities purchase agreement (the December 2025 Purchase Agreement), pursuant to which the Company issued and sold Common Stock, pre-funded warrants and common warrants, in a public offering (the December 2025 Offering), for net proceeds of $ 6,288 after deducting offering expenses of $ 1,711 .
Based on the Company’s current operating plan, the Company believes that its existing cash and cash equivalents will be sufficient to fund its currently planned operating expenses and capital expenditure requirements into the first quarter of 2027. However, this estimate assumes that the Company only commences preliminary work towards the initiation of a Phase 2b trial of GRI-0621; the Company would not be able to complete a clinical trial of GRI-0621, which will require substantial additional capital or resources.
The Company’s ability to continue as a going concern is dependent on its ability to raise additional capital to fund its business activities, including its research and development program. The Company intends to raise capital through additional issuances of equity securities and/or short-term or long-term debt arrangements and potentially through strategic partner and collaboration agreements, but there can be no assurances any such financing will be available when needed, even if the Company’s research and development efforts are successful. If the Company is not able to obtain additional financing on acceptable terms and in the amounts necessary to fully fund its future operating requirements, it may be forced to reduce or discontinue its operations entirely. Therefore, there is substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
References in this Annual Report to “authoritative guidance” is meant to refer to accounting principles generally accepted in the United States of America (GAAP) as found in the Accounting Standards Codification (ASC) and Accounting Standards Updates (ASU) of the Financial Accounting Standards Board (FASB).
Principles of Consolidation
The consolidated financial statements include the accounts of GRI Bio, Inc. and its wholly-owned subsidiary, GRI Bio Operations, Inc. All intercompany balances and transactions have been eliminated.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Estimates and assumptions are primarily made in relation to the valuation of share options, warrant issuance and subsequent revaluations, valuation allowances relating to deferred tax assets, accrued expenses and estimation of the incremental borrowing rate for the operating lease. If actual results differ from the Company’s estimates, or to the extent these estimates are adjusted in future periods, the Company’s consolidated results of operations could either benefit from, or be adversely affected by, any such change in estimate.
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
Cash and Cash Equivalents
Cash equivalents are highly-liquid investments that are readily convertible into cash with original maturities of three months or less when purchased and as of December 31, 2025 and 2024 included investment in money market funds. The Company maintains its cash and cash equivalent balances at domestic financial institutions. Bank deposits with US banks are insured up to $ 250 by the Federal Deposits Insurance Corporation. The Company had an uninsured cash balances of $ 7,443 and $ 4,257 at December 31, 2025 and 2024, respectively.
Fair Value Measurements
Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820, Fair Value Measurement (ASC 820), establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The three levels of fair value hierarchy defined by ASC 820 are described below:
Level 1 : Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
Level 2 : Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
Level 3 : Pricing inputs that are generally unobservable inputs and not corroborated by market data.
As of December 31, 2025, the Company’s financial instruments included cash, cash equivalents, prepaid expenses and other current assets, accounts payable, accrued expenses and certain liability classified warrants. The carrying amounts reported in the consolidated balance sheets for cash, cash equivalents, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their fair value based on the short-term maturity of these instruments. The Company recognizes transfers between levels of the fair value hierarchy on the date of the event or change in circumstances that caused the transfer. At December 31, 2025, there were no financial assets or liabilities measured at fair value on a recurring basis other than the liability classified warrants.
In May 2022, Vallon Pharmaceuticals, Inc. (Vallon) issued warrants (the May 2022 Warrants) in connection with a securities purchase agreement. Vallon evaluated the May 2022 Warrants in accordance with ASC 815-40, Derivatives and Hedging — Contracts in Entity’s Own Equity (ASC 815-40), and concluded that a provision in the May 2022 Warrants related to the reduction of the exercise price in certain circumstances precluded the May 2022 Warrants from being accounted for as components of equity. As a result, the May 2022 Warrants were recorded as a liability on the consolidated balance sheet. Vallon recorded the fair value of the May 2022 Warrants upon issuance using a Black-Scholes valuation model.
The Company is required to revalue the May 2022 Warrants at each reporting date with any changes in fair value recorded in its statement of operations. The valuation of the May 2022 Warrants is considered under Level 3 of the fair value hierarchy due to the need to use assumptions in the valuation that are both significant to the fair value measurement and unobservable. The change in the fair value of the Level 3 warrant liability is reflected in the statement of operations for the year ended December 31, 2024. As of December 31, 2025 and 2024, the fair value of the warrant liability was immaterial.
Deferred Stock Issuance Costs
Deferred stock issuance costs represent incremental costs incurred that are directly attributable to proposed offerings of securities. The costs are charged against the gross proceeds of the respective offering upon closing.
Property and Equipment
Property and equipment are stated at cost. The Company commences depreciation when the asset is placed in service. Computers and peripheral equipment are depreciated on a straight-line method over useful lives of three years .
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
Leases
The Company determines whether an arrangement is a lease at contract inception by establishing if the contract conveys the right to use, or control the use of, identified property, plant, or equipment for a period of time in exchange for consideration. Lease right-of-use (ROU) assets and lease liabilities recognized in the accompanying balance sheet represent the right to use an underlying asset for the lease term and an obligation to make lease payments arising from the lease respectively.
At the lease commencement date, the Company recognizes an ROU asset and a lease liability for its operating leases, except its short-term operating leases with original lease terms of twelve months or less. The ROU asset is initially measured at cost, which primarily comprises the initial amount of the lease liability plus any lease prepayments. The lease liability is initially measured at the present value of the lease payments not yet paid, discounted using an estimate of the Company’s incremental borrowing rate for a collateralized loan with a similar amount and terms as the underlying lease in a similar economic environment. That discount rate is used because the interest rate implicit in the Company’s lease contracts is typically not readily determinable.
Lease modifications that grant the right to use an existing leased asset for an additional period of time are not accounted for as separate contracts; however, the lease term, classification, discount rate, and measurement of the remaining consideration due under the contract are reassessed upon execution of such modifications.
Lease expense for operating leases is recognized on a straight-line basis over the term of the lease and is included in operating expenses.
Research and Development
Research and development costs are expensed as incurred. Research and development expenses include personnel costs associated with research and development activities, including third-party contractors to perform research, conduct clinical trials and manufacture drug supplies and materials. The Company accrues for costs incurred by external service providers, including contract research organizations and clinical investigators, based on its estimates of service performed and costs incurred.
Stock-Based Compensation
The Company recognizes expense for employee and non-employee stock-based compensation in accordance with ASC Topic 718, Stock-Based Compensation (ASC 718). ASC 718 requires that such transactions be accounted for using a fair value-based method. The estimated fair value of the options is amortized over the vesting period, based on the fair value of the options on the date granted, and is calculated using the Black-Scholes option-pricing model. The Company accounts for forfeitures as incurred.
Estimating the fair value of options and shares issued under the employee stock purchase plan requires the input of subjective assumptions, including the estimated fair value of the Company's Common Stock, the expected life of the options, stock price volatility, the risk-free interest rate and expected dividends. The assumptions used in the Company's Black-Scholes option-pricing model represent management's best estimates and involve a number of variables, uncertainties and assumptions and the application of management's judgment, as they are inherently subjective.
Income Taxes
Income taxes are accounted for under the asset and liability method. The Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of the Company's assets and liabilities and the expected benefits of net operating loss carryforwards. The impact of changes in tax rates and laws on deferred taxes, if any, applied during the period in which temporary differences are expected to be settled, is reflected in the Company's financial statements in the period of enactment. The measurement of deferred tax assets is reduced, if necessary, if, based on the weight of the evidence, it is more likely than not that some, or all, of the deferred tax assets will not be realized. As of December 31, 2025 and 2024, the Company concluded
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
that a full valuation allowance was necessary for all of its net deferred tax assets. The Company had no amounts recorded for uncertain tax positions, interest or penalties in the accompanying consolidated financial statements.
Net Loss Per Common Share
Basic net loss per common share is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during each period. Diluted net loss per common share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during each period, plus the dilutive effect of common stock equivalents outstanding during each period, in accordance with ASC 260, Earnings Per Share . As the Company had a net loss in each of the years ended December 31, 2025 and 2024, diluted net loss per common share is the same as basic net loss per common share for the period because the effects of potentially dilutive securities are antidilutive.
Common stock equivalents excluded from the diluted net loss per common share calculations are as follows:
December 31,
2025 2024
Stock options 15,032 1
Warrants 572,781 12,882
587,813 12,883
Recently Adopted Accounting Pronouncements
In December 2023, FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09). The amendments in ASU 2023-09 are intended to enhance the transparency and decision usefulness of income tax disclosures through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 for public entities, with early adoption permitted. Management is currently evaluating the impact of this update on the Company’s financial statements. The Company has adopted the provisions of ASU 2023-09 and has included the required disclosures in this Annual Report. See Note 11 for additional disclosures.
In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07). This amended guidance applies to all public entities and aims to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. This guidance is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. The Company has adopted the provisions of ASU 2023-07 and has included the required disclosures in this Annual Report. See Note 9 for additional disclosures.
Recently Issued Accounting Pronouncements
The Company considers the applicability and impact of all ASUs. ASUs not discussed below were assessed and determined to be either not applicable or are expected to have minimal impact on the financial statements.
In November 2024, FASB issued ASU 2024-03, Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40) (ASU 2024-03). The amendments in ASU 2024-03 require disclosure, in the notes to financial statements, of specified information about certain costs and expenses. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, for all public entities. Early adoption is permitted. Management is currently evaluating the impact of this update on the Company’s financial statements.
In October 2023, FASB issued ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative ( ASU 2023-06) . The amendments in ASU 2023-06 represent changes to clarify or improve disclosure and presentation requirements of a variety of topics in the Codification and align those requirements with the SEC’s regulation. For entities subject to the Security and Exchange Commission’s (SEC) existing disclosure requirements, the effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. For all entities, if by June 30, 2027, the SEC has not removed the applicable requirement from Regulation S-X or Regulation S-K, the pending content of the related amendment will be removed from the Codification and will not become effective for any entity. Management is currently evaluating the impact of this update and its effective dates but does not expect the update to have a material effect on the Company’s financial statements.
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
4. PROPERTY AND EQUIPMENT.
December 31,
2025 2024
Computer equipment $ 24 $ 21
Furniture and fixtures 13 13
37 34
Accumulated depreciation ( 34 ) ( 30 )
$ 3 $ 4
Depreciation expense related to property and equipment was $ 4 in each of the years ended December 31, 2025 and 2024.
5. LEASES.
The Company leases office facilities under an operating lease agreement. The lease agreement requires fixed monthly rental payments as well as payments for variable monthly utilities and operating costs throughout the lease term. The Company evaluates renewal options at lease inception on an ongoing basis and includes renewal options that it is reasonably certain to exercise in its expected lease terms when classifying leases and measuring lease liabilities. Lease agreements generally do not require material variable lease payments, residual value guarantees or restrictive covenants.
The table below presents the operating lease assets and liabilities recognized on the Company's consolidated balance sheets:
December 31,
Balance Sheet Line Item 2025 2024
Non-current operating lease assets Operating lease right-of-use asset
$ 71 $ 120
Operating lease liabilities:
Current operating lease liabilities Operating lease liabilities, current
56 48
Non-current operating lease liabilities Operating lease liabilities, non-current
15 71
Total operating lease liabilities $ 71 $ 119
The Company’s lease generally does not provide an implicit rate, and therefore, the Company uses its incremental borrowing rate as the discount rate when measuring operating leases liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease. The Company used a discount rate of 12 % for its operating lease. The operating lease has a remaining term of 1.25 years.
Future minimum lease payments are due as follows:
Year Ended
December 31,
2026 $ 62
2027 15
Total $ 77
Less: Imputed interest 6
Present value of operating lease liabilities $ 71
Operating lease costs were $ 62 for each of the years ended December 31, 2025 and 2024, respectively. Operating lease costs are included within selling, general and administrative expenses on the consolidated statements of operations.
Cash paid for amounts included in the measurement of operating lease liabilities were $ 60 and $ 59 for the years ended December 31, 2025 and 2024, respectively. This amount is included in operating activities in the consolidated statements of cash flows.
The Company’s principal office is in La Jolla, CA, where it leases approximately 1,100 square feet of office space pursuant to a lease that expires in March 2027.
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
6. ACCRUED EXPENSES.
Accrued expenses consisted of:
December 31,
2025 2024
Accrued expenses:
Research and development $ 383 $ 342
General and administrative 31 12
Payroll and related 336 337
Total accrued expenses $ 750 $ 691
7. STOCKHOLDERS EQUITY.
February 2024 Securities Purchase Agreement
On February 1, 2024, the Company entered into the February 2024 Purchase Agreement, pursuant to which the Company sold, in the February 2024 Offering, (i) 53 shares (the February 2024 Shares) of Common Stock, (ii) 755 pre-funded warrants (the February 2024 Pre-Funded Warrants) exercisable for an aggregate of 755 shares of Common Stock, (iii) 809 Series B-1 common warrants (the Series B-1 Common Warrants) exercisable for an aggregate of 809 shares of Common Stock and (iv) 809 Series B-2 common warrants (the Series B-2 Common Warrants, and together with the Series B-1 Common Warrants, the Series B Common Warrants) exercisable for an aggregate of 809 shares of Common Stock for net proceeds of $ 4,389 , after deducting offering expenses of $ 1,110 . The Series B Common Warrants together with the February 2024 Pre-Funded Warrants are referred to in this Annual Report as the “February 2024 Warrants.” The securities were offered in combinations of (a) one February 2024 Share or one February 2024 Pre-Funded Warrant, together with (b) one Series B-1 Common Warrant and one Series B-2 Common Warrant, for a combined purchase price of $ 6,806.80 (less $ 0.6188 for each February 2024 Pre-Funded Warrant).
Subject to certain ownership limitations, the February 2024 Warrants were exercisable upon issuance. Each February 2024 Pre-Funded Warrant was exercisable for one share of Common Stock at a price per share of $ 0.6188 and expired when exercised in full. Each Series B-1 Common Warrant is exercisable into one share of Common Stock at a price per share of $ 6,806.80 for a five-year period after February 6, 2024, the date of issuance. Each Series B-2 Common Warrant is exercisable into one share of Common Stock at a price per share of $ 6,806.80 for an 18 -month period after February 6, 2024, the date of issuance. The February 2024 Warrants were classified as equity and the allocated fair value of $ 4,279 is included in additional paid-in capital. As of December 31, 2025, all of the February 2024 Pre-Funded Warrants have been exercised.
The Company determined that the amount paid for the February 2024 Pre-Funded Warrants approximates their fair value. The Black-Scholes option-pricing model was used to estimate the fair value of the Series B-1 Common and Series B-2 Common Warrants with the following weighted-average assumptions:
Volatility 156.3 %
Expected term in years 1.63
Dividend rate 0.0 %
Risk-free interest rate 4.65 %
In connection with the issuance of the securities pursuant to the February 2024 Purchase Agreement, the exercise price of the Company’s previously outstanding Series A-1 common warrants (the Series A-1 Warrants) was reduced to par, or $ 0.0001 , per share pursuant to the terms of the Series A-1 Warrants. As of December 31, 2025, all of the Series A-1 Warrants have been exercised.
May 2024 At The Market Offering
On May 20, 2024, the Company entered into the Sales Agreement with Wainwright, pursuant to which the Company may sell and issue, subject to the limitations in the Sales Agreement, shares up to $ 10.0 million of Common Stock from time to time in the ATM Offering. Under the Sales Agreement, Wainwright is entitled to compensation of 3.0 % of the gross offering proceeds of all shares of Common Stock sold through it pursuant to the Sales Agreement.
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
As of December 31, 2025, the Company has sold 60,003 shares of Common Stock in the ATM Offering at a weighted-average price of $ 102.75 per share, for gross proceeds of $ 6,165 and net proceeds of $ 5,858 . During the year ended December 31, 2025, the Company sold 48,374 shares of Common Stock in the ATM Offering with a weighted average price of $ 52.93 per share, for gross proceeds of $ 2,560 and net proceeds of $ 2,391 . During the year ended December 31, 2024, the Company sold 11,629 shares of Common Stock in the ATM Offering with a weighted average price of $ 309.97 per share, for gross proceeds of $ 3,604 and net proceeds of $ 3,467 .
On January 9, 2026, the Company filed a prospectus supplement to its registration statement on Form S-3 (File No. 333-279348) to increase the amount of shares of Common Stock that the Company may offer and sell under the Sales Agreement and applicable registration statement to an aggregate offering price of up to $ 7,380 , which amount does not include the shares of Common Stock having an aggregate gross sales price of approximately $ 6,165 that were sold under the ATM Offering through January 8, 2026, in accordance with the limitations set forth in Instruction I.B.6 of Form S-3.
June 2024 Securities Purchase Agreement
On June 26, 2024, the Company entered into the June 2024 Purchase Agreement, pursuant to which the Company issued and sold, in the June 2024 Offering, (i) 126 shares (the June 2024 Shares) of Common Stock, (ii) 4,466 pre-funded warrants (the June 2024 Pre-Funded Warrants) exercisable for an aggregate of 4,466 shares of Common Stock, (iii) 4,593 Series C-1 common warrants (the Series C-1 Common Warrants) exercisable for an aggregate of 4,593 shares of Common Stock, and (iv) 4,593 Series C-2 common warrants (the Series C-2 Common Warrants, and together with the Series C-1 Common Warrants, the Series C Common Warrants), exercisable for an aggregate of 4,593 shares of Common Stock for net proceeds of $ 3,172 , after deducting offering expenses of $ 1,057 . The Series C Common Warrants together with the June 2024 Pre-Funded Warrants are referred to in this Annual Report as the “June 2024 Warrants.” The securities were offered in combinations of (a) one June 2024 Share or one June 2024 Pre-Funded Warrant, together with (b) one Series C-1 Common Warrant and one Series C-2 Common Warrant, for a combined purchase price of $ 871.08 (less $ 0.0476 for each June 2024 Pre-Funded Warrant).
The June 2024 Pre-Funded Warrants were exercisable for one share of Common Stock at a price per share of $ 0.0476 , were exercisable immediately and have been exercised in full as of December 31, 2025. Each Series C-1 Common Warrant is exercisable into one share of Common Stock at a price per share of $ 871.08 or a five-year period beginning after September 6, 2024. Each Series C-2 Common Warrant is exercisable into one share of Common Stock at a price per share of $ 871.08 for an 18 -month period beginning after September 6, 2024. The June 2024 Pre-Funded Warrants and the Series C Common Warrants were classified as equity and the allocated fair value of $ 2,908 is included in additional paid in capital.
Pursuant to an engagement agreement with Wainwright, the Company, in connection with the June 2024 Offering, issued to Wainwright, or its designees, warrants to purchase up to an aggregate of 324 shares of Common Stock (the June 2024 PA Warrants). The June 2024 PA Warrants have an exercise price of $ 1,088.92 per share and will expire on June 26, 2029. The June 2024 PA Warrants were classified as equity and the fair value of $ 229 is included in additional paid-in capital.
The Company determined that the amount paid for the June 2024 Pre-Funded Warrants approximates their fair value. The Black-Scholes option-pricing model was used to estimate the fair value of the Series C-1 Common Warrants, the Series C-2 Common Warrants, and the Placement Agent Warrants with the following weighted-average assumptions:
Volatility 159.1 %
Expected term in years 1.65
Dividend rate 0.0 %
Risk-free interest rate 4.92 %
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
October 2024 Repricing Letter Agreement
On October 21, 2024, the Company entered into the Repricing Letter Agreements with certain Holders of its issued and outstanding Series B Common Warrants to purchase an aggregate of 1,602 shares of its Common Stock, pursuant to which these Holders exercised Series B Common Warrants for cash at a reduced exercise price equal to $ 476.00 per share. In addition, these Holders received new unregistered Series D-1 common warrants (the Series D-1 Common Warrants) exercisable for up to an aggregate of 1,604 shares of Common Stock and new unregistered Series D-2 common warrants (the Series D-2 Common Warrants, and together with the Series D-1 Common Warrants, the Series D Common Warrants) exercisable for up to an aggregate of 1,604 shares of Common Stock. The Series D Common Warrants are immediately exercisable and have an exercise price of $ 476.00 per share. The Series D-1 Common Warrants expire on October 22, 2029, and the Series D-2 Common Warrants expire on April 22, 2026. This transaction is referred to as the “Warrant Repricing Transaction.”
Wainwright acted as the exclusive placement agent for the Warrant Repricing Transaction pu rsuant to an engagement agreement between the Company and Wainwright dated as of October 21, 2024. As compensation for such placement agent services, the Company agreed to pay Wainwright an aggregate cash fee equal to 7.0 % of the gross proceeds received by the Company from the Warrant Repricing Transaction, plus a management fee equal to 1.0 % of the gross proceeds received by the Company from the Warrant Repricing Transaction, and reimbursement for accountable expenses of $ 25,000 and non-accountable expenses of $ 10,000 . The Company has also issued to Wainwright or its designees the October 2024 PA Warrants to purchase up to an aggregate of 114 shares of Common Stock (the October 2024 PA Warrants). The October 2024 PA Warrants are immediately exercisable, expire on October 22, 2029, and have an exercise price of $ 595.00 per share.
The net proceeds to the Company from the exercise of the Series B Common Warrants were $ 608 after deducting placement agent fees and offering expenses of $ 154 . The issuance under the Repricing Letter Agreements represented $ 1,911 in additional value provided to the investors, which was recorded as a deemed dividend to common stockholders.
The Black-Scholes option-pricing model was used to estimate the fair value of the Series D-1 Common Warrants, the Series D-2 Common Warrants, and the October 2024 PA Warrants with the following weighted-average assumptions:
Volatility 174.4 %
Expected term in years 1.65
Dividend rate 0.0 %
Risk-free interest rate 4.16 %
April 2025 Securities Purchase Agreement
On April 1, 2025, the Company entered into the April 2025 Purchase Agreement, pursuant to which the Company issued and sold, in the April 2025 Offering, (i) 7,214 shares (the April 2025 Shares) of Common Stock, (ii) 42,389 pre-funded warrants (the April 2025 Pre-Funded Warrants) exercisable for an aggregate of 42,389 shares of Common Stock, (iii) 49,605 Series E-1 common stock warrants (the Series E-1 Common Warrants) to purchase up to 49,605 shares of Common Stock, (iv) 49,605 Series E-2 common stock warrants (the Series E-2 Common Warrants) to purchase up to 49,605 shares of Common Stock, and (v) 49,605 Series E-3 common stock warrants (the Series E-3 Common Warrants, and collectively with the Series E-1 Common Warrants and the Series E-2 Common Warrants, the Series E Common Warrants) to purchase up to 49,605 shares of Common Stock, for net proceeds of $ 4,020 , after deducting offering expenses of $ 979 .
The securities were offered in combinations of (a) one April 2025 Share or one April 2025 Pre-Funded Warrant, together with (b) one Series E-1 Common Warrant, one Series E-2 Common Warrant and one Series E-3 Common Warrant, for a combined purchase price of $ 100.80 (less $ 0.0028 for each April 2025 Pre-Funded Warrant). The April 2025 Pre-Funded Warrants had an exercise price of $ 0.0028 per share, became exercisable immediately upon issuance and expired when exercised in full. Each Series E Common Warrant has an exercise price of $ 89.60 per share and became exercisable immediately upon issuance. The Series E-1 Common Warrants expire on April 2, 2030. The Series E-2 Common Warrants expire on October 2, 2026. The Series E-3 Common Warrants expired on January 2, 2026. As of December 31, 2025, the April 2025 Pre-Funded Warrants have been exercised in full.
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
Wainwright acted as the exclusive placement agent for the April 2025 Offering pursuant to an engagement agreement between the Company and Wainwright dated as of March 7, 2025. As compensation for such placement agent services, the Company agreed to pay Wainwright an aggregate cash fee equal to 7.0 % of the gross proceeds received by the Company from the offering, plus a management fee equal to 1.0 % of the gross proceeds received by the Company from the offering, reimbursement for accountable expenses of $ 25,000 , reimbursement of up to $ 100,000 for legal fees and expenses and other out-of-pocket expenses and up to $ 15,950 for the clearing expenses. The Company also issued to Wainwright, or its designees, warrants to purchase up to an aggregate of 3,474 shares of Common Stock (the April 2025 PA Warrants). The April 2025 PA Warrants became exercisable immediately upon issuance, expire on April 1, 2030, and have an exercise price of $ 126.00 per share. The April 2025 PA Warrants were classified as equity and the fair value of $ 123 is included in additional paid-in capital.
The Company determined that the amount paid for the April 2025 Pre-Funded Warrants approximates their fair value. The Black-Scholes option-pricing model was used to estimate the fair value of the Series E Common Warrants and the April 2025 PA Warrants with the following weighted-average assumptions:
Volatility
156.44 %
Expected term in years
2.48
Dividend rate
— %
Risk-free interest rate
4.02 %
December 2025 Securities Purchase Agreement
On December 12, 2025, the Company entered into the December 2025 Purchase Agreement, pursuant to which the Company issued and sold, in the December 2025 Offering, (i) 92,976 shares (the December 2025 Shares) of Common Stock (ii) 287,977 pre-funded warrants (the December 2025 Pre-Funded Warrants) exercisable for an aggregate of 287,977 shares of Common Stock and (iii) 380,962 Series F common stock warrants (the Series F Common Warrants) to purchase up to 380,962 shares of Common Stock for net proceeds of $ 6,288 after deducting offering expenses of $ 1,711 .
The securities were offered in combinations of (a) one December 2025 Share or one December 2025 Pre-Funded Warrant, together with (b) one Series F Common Warrant for a combined purchase price of $ 21.00 (less $ 0.0028 for each December 2025 Pre-Funded Warrant). The December 2025 Pre-Funded Warrants had an exercise price of $ 0.0028 per share, became exercisable immediately upon issuance and expired when exercised in full. Each Series F Common Warrant has an exercise price of $ 21.00 per share, became exercisable immediately upon issuance and expire on December 12, 2030. As of December 31, 2025, the December 2025 Pre-Funded Warrants have been exercised in full.
Wainwright acted as the exclusive placement agent for the December 2025 Offering pursuant to an engagement agreement between the Company and Wainwright dated as of December 5, 2025. As compensation for such placement agent services, the Company agreed to pay Wainwright an aggregate cash fee equal to 7.0 % of the gross proceeds received by the Company from the offering, plus a management fee equal to 1.0 % of the gross proceeds received by the Company from the offering, reimbursement for accountable expenses of $ 25,000 , reimbursement of up to $ 100,000 for legal fees and expenses and other out-of-pocket expenses and up to $ 15,950 for the clearing expenses. The Company also issued to Wainwright, or its designees, warrants to purchase up to an aggregate of 26,667 shares of Common Stock (the December 2025 PA Warrants). The December 2025 PA Warrants became exercisable immediately upon issuance, expire on December 12, 2030, and have an exercise price of $ 26.25 per share. The December 2025 PA Warrants were classified as equity and the fair value of $ 317 is included in additional paid-in capital.
The Company determined that the amount paid for the December 2025 Pre-Funded Warrants approximates their fair value. The Black-Scholes option-pricing model was used to estimate the fair value of the Series F Common Warrants and the December 2025 PA Warrants with the following weighted-average assumptions:
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
Volatility
124.87 %
Expected term in years
5.0
Dividend rate
— %
Risk-free interest rate
3.75 %
Warrants
As of December 31, 2025, the Company had the following warrants outstanding to purchase common stock.
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
Number of Shares Exercise Price per Share Expiration Date
49,605 $ 89.60 January 2026
9 $ 12,994,800.00 February 2026
4,593 $ 871.08 March 2026
1,604 $ 476.00 April 2026
49,605 $ 89.60 October 2026
1 $ 1,219,345.40 May 2027
1 $ 0.01 July 2027
3 $ 2,659,169.24 April 2028
19 $ 6,806.80 February 2029
324 $ 1,088.85 June 2029
4,593 $ 871.08 September 2029
1,604 $ 476.00 October 2029
114 $ 595.00 October 2029
49,605 $ 89.60 April 2030
3,474 $ 126.00 April 2030
380,962 $ 21.00 December 2030
26,667 $ 26.25 December 2030
8. STOCK BASED COMPENSATION.
Amended and Restated 2018 Equity Incentive Plan
On April 21, 2023, the stockholders of the Company approved the Amended and Restated GRI Bio, Inc. 2018 Equity Incentive Plan (the A&R 2018 Plan) and on August 13, 2025, the stockholders of the Company approved an amendment to the A&R 2018 Plan to increase the aggregate number of shares of the Company’s Common Stock thereunder by 14,285 . The A&R 2018 Plan provides the Company with the ability to grant stock options, restricted stock and other equity-based awards to employees, directors and consultants. Stock options granted by the Company under the A&R 2018 Plan generally have a contractual life of up to 10 years. As of December 31, 2025, awards granted under the A&R 2018 Plan representing the right to purchase or contingent right to receive up to an aggregate of 15,032 shares of the Company's Common Stock were outstanding and 15,044 shares of the Company’s Common Stock were reserved for issuance under the A&R 2018 Plan. The number of shares reserved for issuance under the A&R 2018 Plan may be increased pursuant to the A&R 2018 Plan’s “evergreen” provision on the first day of each calendar year beginning January 1, 2025 and ending on and including January 1, 2033, by a number of shares not to exceed 4 % of the aggregate number of shares of the Company’s Common Stock outstanding on the final day of the immediately preceding calendar year.
The Company recorded stock-based compensation related to equity-based awards issued under the A&R 2018 Plan in the following expense categories of its accompanying consolidated statements of operations for the years ended December 31, 2025 and 2024:
For the Year Ended December 31,
2025 2024
Research and development $ 86 $ —
General and administrative 707 148
Total $ 793 $ 148
The Company measures equity-based awards granted to employees and non-employees based on their fair value on the date of the grant and recognizes compensation expense for those awards over the requisite service period or performance-based period, which is generally the vesting period of the respective award. The measurement date for service-based equity awards is the date of grant, and
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Table of Contents
GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
equity-based compensation costs are recognized as expense over the requisite service period. The Company records expense for performance-based awards if the Company concludes that it is probable that the performance condition will be achieved.
The table below represents the activity of stock options granted to employees and non-employees for the year ended December 31, 2025:
Number of options Weighted average exercise price Weighted average remaining contractual term (years)
Outstanding at December 31, 2024 1 $ 65,840.32 7.75
Granted 15,031 $ 64.07
Exercised —
Forfeited —
Outstanding at December 31, 2025 15,032 $ 68.44 9.67
Exercisable at December 31, 2025 11,127 $ 69.57 9.66
Vested and expected to vest at December 31, 2025 15,032 $ 68.44 9.67
As of December 31, 2025, all of the outstanding and exercisable stock options were out of the money and therefore had no intrinsic value. At December 31, 2025, the unrecognized compensation cost related to unvested stock options expected to vest was $ 249 . This unrecognized compensation is expected to be recognized over a weighted-average amortization period of 0.92 years.
The Company granted 15,031 stock options to employees and non-employees during the year ended December 31, 2025. The Black-Scholes option-pricing model was used to estimate the grant date fair value of each stock option grant at the time of grant using the following weighted-average assumptions:
For the Year Ended December 31, 2025
Volatility 120.89 %
Expected term in years 5.18
Dividend rate 0.00 %
Risk-free interest rate 3.75 %
Fair value of common stock on grant date $ 64.07
No equity-based awards were granted during the year ended December 31, 2024.
Option valuation methods, including Black-Scholes, require the input of subjective assumptions, which are discussed below.
• The expected term of options is determined using the "simplified" method, as prescribed in SEC's SAB No. 107, Share Based Payment (SAB No. 107), whereby the expected life equals the arithmetic average of the vesting term and the original contractual term of the option due to the Company's lack of sufficient historical data.
• The expected volatility is based on a weighted average of the Company's historical volatility and the volatilities of similar entities within the Company's industry which were commensurate with the expected term assumption as described in SAB No. 107.
• The risk-free interest rate is based on the interest rate payable on US Treasury securities in effect at the time of grant for a period that is commensurate with the assumed expected term.
• The expected dividend yield is 0 % because the Company has not historically paid, and does not expect for the foreseeable future to pay, a dividend on its common stock.
9. SEGMENT REPORTING.
Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker (CODM), or decision-making group, in deciding how to allocate resources in assessing performance. The Company has one reportable segment: biotechnology research. The biotechnology research segment consists of the
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Table of Contents
GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
research and development of products for the treatment of inflammatory disease. The Company’s CODM is W. Marc Hertz, Ph.D., Chief Executive Officer and Director.
The accounting policies of the biotechnology research segment are the same as those described in the summary of significant accounting policies. The CODM assesses performance for the biotechnology research segment based on research and development expenses and general and administrative expenses as part of the overall review of the Company’s consolidated net loss and consolidated cash flows as compared to prior quarters and the Company’s operating budget.
The Company has incurred significant losses since its inception and anticipates incurring continued losses in the future. As such, the CODM uses cash forecast models in deciding how to allocate resources based on the Company’s available cash resources, as well as its forecasted expenditures. This information, in conjunction with the assessment of the probability of the success of the Company’s research and development activities, is used to plan the timing and size of future capital raises.
10. COMMITMENTS AND CONTINGENCIES.
Legal Proceedings
The Company is not currently a party to any material legal proceedings, and is not aware of any pending or threatened legal proceeding against the Company that it believes could have a material adverse effect on its business, operating results or financial condition. From time to time, the Company may become involved in legal proceedings arising in the ordinary course of its business. Regardless of outcome, litigation can have a material adverse impact on the Company due to defense and settlement costs, diversion of management resources, negative publicity, reputational harm and other factors.
Employment Agreements
The Company has entered into employment contracts with each of its officers that provide for severance and continuation of benefits in the event of termination of employment by the Company without cause or by the employee for good reason. In addition, in the event of termination of employment following a change in control, the vesting of certain equity awards may be accelerated.
Separation and Release Agreement
In connection with the resignation of David Baker, the Company’s former Chief Executive Officer, pursuant to the Merger, the Company and Mr. Baker entered into a Separation and Release Agreement on April 21, 2023 (the Separation Agreement). Pursuant to the terms of the Separation Agreement and his employment agreement, Mr. Baker will receive continuation of his current salary and certain COBRA benefits for 18 months payable in accordance with the Company’s payroll practices. Mr. Baker also received a lump sum payment equal to 150 % of his target bonus and agreed to reduce amounts payable with respect to certain future milestone payments.
11. INCOME TAX.
A reconciliation of income tax expense (benefit) at the US federal statutory income tax rate and the income tax provision in the financial statements is as follows:
December 31,
2025 2024
$ % $ %
Expected income tax benefit at the U.S. federal statutory tax rate ( 2,511 ) 21.0 ( 1,723 ) 21.0
State and local taxes, net of federal benefit (1)
2 — 1 —
Tax credits
Research and development credits
— — 136 ( 1.7 )
Change in valuation allowance 2,195 ( 18.4 ) 1,842 ( 22.4 )
Nontaxable or nondeductible items
Equity compensation
316 ( 2.6 ) 6 ( 0.1 )
Other nontaxable or nondeductible items
1 — 54 ( 0.6 )
Deferred tax adjustment
— — ( 314 ) 3.8
Total 3 — 2 —
_________________
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
(1) During the years ended December 31, 2025 and 2024, state taxes in California made up the majority (greater than 50%) of the tax effect in this category.
Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.
The principal components of the Company’s deferred tax assets and liabilities are as follows:
December 31,
2025 2024
Deferred tax assets:
Federal and state net operating loss carryforwards $ 16,784 $ 14,537
Share based compensation — 200
Accruals and other — 94
Lease liabilities 20 34
Capitalized research and development costs 3,161 1,846
Depreciation - Federal and state
2 2
Amortization - Federal and state
4 5
Gross deferred tax assets $ 19,971 $ 16,718
Less: deferred tax liabilities ( 20 ) ( 34 )
Less: valuation allowance ( 19,951 ) ( 16,684 )
Net deferred tax assets $ — $ —
Based on the Company’s history of losses, the Company recorded a full valuation allowance against its deferred tax assets as of December 31, 2025 and 2024. The Company increased its valuation allowance by approximately $ 3,267 for the year ended December 31, 2025. The Company intends to maintain a valuation allowance until sufficient positive evidence exists to support a reversal of the allowance.
As of December 31, 2025, the Company had federal, state and local net operating loss carryforwards of $ 59,173 , $ 69,754 , and $ 5,563 , respectively; $ 53,048 of the federal net operating loss carryforwards do not expire and the remaining $ 6,124 begin to expire in 2029. The state losses also begin to expire in 2029. The local net operating losses began to expire in 2024. Under the provisions of Sections 382 and 383 of the Internal Revenue Code of 1986, as amended (IRC), these net operating losses, credit carryforwards and other tax attributes may be subject to limitation based on previous significant changes in ownership and upon future significant changes in ownership of the Company, as defined by the IRC.
Under the provisions of Sections 382 and 383 of the IRC, certain substantial changes in the Company’s ownership may have limited, or may limit in the future, the amount of net operating loss and credit carryforwards that can be used to reduce future income taxes if there has been a significant change in ownership of the Company, as defined by the IRC. Future owner or equity shifts could result in limitations on net operating loss and credit carryforwards. The Company has not conducted a Section 382 analysis to determine the potential limitations on the utilization of its net operating loss carryforwards and other tax attributes. Management does not believe that any such limitations, if applicable, would have a material impact on the Company’s consolidated financial statements.
The Company files income tax returns in the US federal jurisdiction as well as California, Pennsylvania and Philadelphia. The tax years 2021 to 2024 remain open to examination by the major jurisdictions in which the Company is subject to tax. Fiscal years outside the normal statute of limitation remain open to audit by tax authorities due to tax attributes generated in those early years, which have been carried forward and may be audited in subsequent years when utilized.
The Company evaluates tax positions for recognition using a more-likely-than-not recognition threshold, and those tax positions eligible for recognition are measured as the largest amount of tax benefit that is greater than 50% likely of being realized upon the effective settlement with a taxing authority that has full knowledge of all relevant information. As of December 31, 2025 and 2024, the Company had no unrecognized income tax benefits that would affect the Company’s effective tax rate if recognized. The Company would recognize both accrued interest and penalties related to unrecognized benefits in income tax expense. The Company’s uncertain tax positions yet to be determined would be related to years that remain subject to examination by relevant tax authorities. Since the Company is in a loss carryforward position, the Company is generally subject to examination by the U.S. federal, state and local income tax authorities for all tax years in which a loss carryforward is available.
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GRI Bio, Inc.
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
12. SUBSEQUENT EVENTS.
Recapitalization
On January 23, 2026, the Company effected the January 2026 Reverse Stock Split. Stockholders’ equity and all references to share and per share amounts in the accompanying financial statements have been retroactively adjusted to reflect the one-for-twenty-eight reverse stock split for all periods presented.
May 2024 At The Market Offering
As discussed in Note 7, “Stockholders’ Equity” to these audited consolidated financial statements, on January 9, 2026, the Company filed a prospectus supplement to its registration statement on Form S-3 (File No. 333-279348) to increase the amount of shares of Common Stock that the Company may offer and sell under the Sales Agreement and applicable registration statement to an aggregate offering price of up to $ 7,380 , which amount does not include the shares of Common Stock having an aggregate gross sales price of approximately $ 6,165 that were sold under the ATM Offering through January 8, 2026, in accordance with the limitations set forth in Instruction I.B.6 of Form S-3. Since December 31, 2025, the Company has sold 947,342 shares of Common Stock with an aggregate gross sales price of $ 6,474 .
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