TEN Holdings, Inc. 10-K

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Common Stock Our common stock trades under the symbol “XHLD” on the Nasdaq Capital Market. Holders of Record As of March 28, 2025, we had 28,693,442 shares of common stock issued and outstanding held by three stockholders of record, not including beneficial holders whose shares are held in names other than their own. Dividend Policy As of the date of this annual report, we have not paid any cash dividends on our common stock, and our board of directors intends to continue a policy of retaining earnings, if any, for use in our operations, though we may change this policy in the future. Any determination by our board of directors to pay dividends in the future to stockholders will be dependent upon our operational results, financial condition, capital requirements, business projections, general business conditions, statutory and regulatory restrictions, and any other factors deemed appropriate by our board of directors. Equity Compensation Plans For information on securities authorized for issuance under our existing equity compensation plan as of December 31, 2024, see Item 12 under the heading “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.” Recent Sales of Unregistered Securities During the fiscal year ended December 31, 2024, we issued the following securities which were not registered under the Securities Act. We believe that each of the following issuance was exempt from registration under the Securities Act in reliance on Regulation D under the Securities Act or pursuant to Section 4(2) of the Securities Act regarding transactions not involving a public offering or in reliance on Regulation S under the Securities Act regarding sales by an issuer in offshore transactions. No underwriters were involved in these issuances of securities. V-Cube, Inc. subscribed for 10 shares of common stock of TEN Holdings, Inc. in consideration of $10.00 in the corporate formation of TEN Holdings, Inc. on February 12, 2024, and obtained another 90 shares of common stock of TEN Holdings, Inc. on July 2, 2024 in exchange for the 100% equity interest in TEN Events, Inc. valued at approximately $32.5 million. Accordingly, the consideration paid by V-Cube, Inc. for its equity interest in TEN Holdings, Inc. (amounting to 25 million shares of common stock post reverse split and corporate restructuring) was approximately $32.5 million. 27 Spirit Advisors, LLC (“Spirit Advisors”) received a warrant to purchase the Company’s common stock as of February 12, 2024, in partial consideration for consulting services rendered in connection with the IPO. On February 19, 2025, Spirit Advisors acquired 1,337,312 shares of the Company’s common stock through the cashless exercise of the warrant. On March 25, 2024, Xyvid, Inc. (now known as TEN Events, Inc., our operating entity) entered into a certain Agreement for Loan Conditions with Naoaki Mashita, our Director and the chief executive officer of V-Cube, Inc., the Company’s controlling stockholder, pursuant to which loan agreement, Mr. Mashita agreed to provide a loan to Xyvid, Inc. in the principal amount of $317,000, bearing interest at an annual interest rate of 6.0%, with an original repayment date of December 31, 2024, and which loan agreement was assigned to and assumed by the Company on September 5, 2024, and the indebtedness thereunder was memorialized in a convertible promissory note delivered on such date with the same terms, which convertible promissory note is convertible, in whole or in part, into shares of common stock of the Company prior to the maturity thereof. The conversion price of such convertible promissory note is at $0.46 per share of common stock. On December 23, 2024, the Company and Mr. Mashita agreed to extend the repayment date relative to the outstanding interest component of such indebtedness as of such date of December 31, 2024 to March 31, 2025, pursuant to amendments to each of the Agreement for Loan Conditions and the convertible promissory note, entered into by the parties thereto, On December 23, 2024, we issued 689,130 shares of common stock to Mr. Naoaki Mashita pursuant to the partial conversion of the convertible promissory note, as amended, in the outstanding principal amount of $317,000 held by Mr. Naoaki Mashita. The repayment date of the outstanding interest due on the convertible promissory note was further extended on March 19, 2025, to December 31, 2025, pursuant to amendments to each of the Agreement for Loan Conditions and the convertible promissory note. On September 5, 2024, the Company’s board of directors adopted an equity incentive plan (the “Plan”) under which an aggregate of 10% of the Company’s authorized shares of common stock, which equals 12,500,000 shares of common stock, were reserved for issuance. On September 27, 2024, the Company’s board of directors and then sole stockholder approved the resolution to change the maximum number of shares of common stock of the Company reserved and available for granting awards under the Plan from 12,500,000 to 4,000,000. The Plan allows for the issuance of options, stock appreciation rights, restricted stock, restricted stock unit, performance award, dividend equivalent, and other stock-based award to selected employees, officers, directors and consultants, for them to acquire a proprietary interest in the growth and performance of the Company. On October 10, 2024, the Company granted stock options to certain individuals who were the Company’s directors and employees to purchase an aggregate of 2,640,250 shares of common stock at an exercise price of $0.46 per share. The options have a contractual term of ten years and vest upon the satisfaction of service conditions for Company employees and performance conditions for Company directors. Pursuant to the stock award agreements, an aggregate of 1,122,925 shares of common stock vested upon the completion of our IPO. Since incorporation, there have been changes in the ownership of our common stock. See “Item 1. Business—Corporate History and Structure.” On October 9, 2024, our Company’s then sole Director and majority stockholder approved a 2-for-1 reverse stock split, as a result of which the aggregated number of outstanding shares of common stock changed from 50,000,000 to 25,000,000. The number of shares of common stock referenced above reflects the effect of such reverse stock split. Use of Proceeds The following “Use of Proceeds” information relates to the registration statement on Form S-1, as amended (File Number 333-282621), for our IPO, which was declared effective by the SEC on February 7, 2025. On February 18, 2025, we completed our IPO, in which we registered, issued and sold an aggregate of 1,667,000 shares of common stock, at a public offering price of $6.00 per share for $10,002,000. Bancroft Capital, LLC was the representative of the underwriters of our IPO. We incurred approximately $1,101,770 in expenses in connection with our IPO, which included approximately $550,110 in underwriting discounts, approximately $100,020 in expenses paid to or for underwriters, approximately $440,060 in legal and financial service fees, and approximately $11,580 in other expenses. None of the transaction expenses included payments to directors or officers of our Company or their associates, persons owning more than 10% or more of our equity securities or our affiliates. None of the net proceeds we received from the IPO were paid, directly or indirectly, to any of our directors or officers or their associates, persons owning 10% or more of our equity securities or our affiliates. The net proceeds raised from the IPO were $8,900,230, after deducting underwriting discounts and the offering expenses payable by us. As of the date of this annual report, we have used approximately $2.5 million, $2.0 million, $2.0 million, and $1.7 million from the net proceeds for (i) advisory services for future financing related to acquisitions, business development and growth initiatives, (ii) repayment of short-term loans, (iii) marketing efforts to boost brand awareness, and (iv) working capital and general corporate purposes to support day-to-day operations, respectively. We intend to use the remaining proceeds from our IPO largely in the manner disclosed in our registration statement on Form S-1, as amended (File Number 333-282621). 28 Recent Purchases of Equity Securities None. Item 6. [Reserved].