Aditxt, Inc. Material Event Summary

Aditxt, Inc. recently held a pivotal special meeting, where shareholders approved several key proposals that could reshape the company's future. This summary breaks down the critical decisions made, their timeline, and what they mean for investors.

---

1. Event Description

Aditxt, Inc. shareholders recently convened a special meeting, casting votes on several significant proposals. These approvals set the stage for major changes, including:

• Reverse Stock Split Authority: Shareholders authorized the company's board of directors to implement a reverse stock split of its common stock. This split could range from 1-for-5 to 1-for-250 shares. Companies typically pursue this action to increase their per-share stock price, often to meet exchange listing requirements like NASDAQ's minimum bid price rule.
• Issuance of Common Shares for Past Funding: Shareholders approved issuing common shares to fulfill past funding agreements. This includes shares for converting Series A-1 and Series C-1 convertible preferred stock, and for exercising various warrants issued in 2023 and 2024. This approval allows these investment instruments to convert into regular common stock.
• Advisory Vote for Name Change: Shareholders cast a non-binding advisory vote to change the company's name from "Aditxt, Inc." to "bitXbio, Inc." This vote signals a potential rebranding or a significant strategic shift for the company.
• New Employee Stock Plans: Shareholders approved a new 2025 Employee Stock Purchase Plan (ESPP) and increased the shares available for the company's 2021 Equity Incentive Plan. These plans aim to attract and retain employees by offering equity compensation.

2. Event Date/Timeline

Shareholders approved these proposals at a special meeting held on February 13, 2026.

• If the board decides to implement the reverse stock split, it will occur within one year from the special meeting date.
• The official name change to "bitXbio, Inc." will be implemented later, likely with more details on the company's new strategic direction.
• The company will issue common shares as investors convert preferred stock and warrants, following the terms of those agreements.

3. Impact Assessment

These approvals pave the way for significant changes at Aditxt, directly affecting various stakeholders:

• Existing Investors/Shareholders:
  • Reverse Split: If implemented, shareholders will own fewer shares, but each share should theoretically be worth proportionally more immediately after the split. The broad approved range (1:5 to 1:250) means the impact on individual share counts could be substantial.
  • Dilution: Converting preferred stock and warrants into common shares could significantly increase the total number of outstanding shares. This action may dilute existing shareholders' ownership percentage and share value.
  • Name Change: This will alter the company's identity and market perception.
• Aditxt Management & Company: These approvals equip management with essential tools to address NASDAQ listing compliance, fulfill past financing obligations, potentially rebrand the company, and incentivize employees. This flexibility is crucial for operational and strategic execution, particularly as the company navigates financial challenges and potential strategic shifts.
• Potential New Investors: New investors will evaluate a company with a potentially higher per-share price (post-split) and a new corporate identity. They must also consider the potential for significant dilution from newly approved share issuances and the inherent risks of a company undergoing such a transformation.
• Employees: Employees stand to benefit from the approved stock purchase and incentive plans. These plans can significantly boost their compensation and motivation, especially during company transitions or restructuring.

4. Financial Impact

The approved proposals have several significant financial implications for Aditxt, Inc.:

• NASDAQ Listing Compliance: The primary financial reason for authorizing a reverse stock split is to increase the per-share price, helping Aditxt meet NASDAQ's minimum bid price requirement (Rule 5550(a)(2)). Non-compliance could lead to delisting, severely impairing the stock's liquidity, market visibility, and investor confidence. This could significantly decrease market capitalization and hinder future capital-raising efforts.
• Potential Share Dilution: Approving the issuance of common shares for converting Series A-1 and C-1 convertible preferred stock and various warrants from 2023 and 2024 signals a substantial increase in total outstanding common shares. This will dilute existing shareholders' ownership percentage and could pressure the stock's earnings per share (if any) and market price. While the summary did not disclose the exact number, it indicates "millions of new shares" could be issued upon conversion.
• Capital Structure Management: These approvals are crucial for fulfilling contractual obligations to investors who provided funding, enabling the conversion of their investment instruments into common equity. This step is essential for maintaining investor trust and effectively managing the company's capital structure.
• Employee Compensation and Retention Costs: The new 2025 Employee Stock Purchase Plan and the increased shares for the 2021 Equity Incentive Plan represent a financial commitment to attract, retain, and incentivize employees through equity-based compensation. While these plans align employee interests with shareholder value, they also pose a potential source of future share dilution.
• Market Perception: While a reverse stock split offers a "cosmetic" fix for a low stock price, it often signals underlying financial distress to the market. Historically, many companies that undergo reverse splits see their stock price decline again long-term, as the split itself does not address fundamental business challenges.

5. Key Investor Takeaways

• Reverse Split Authority, Not Implementation: The board now has the authority to implement a reverse stock split within the next year, but it has not yet happened. Investors should prepare for an announcement about its execution and specific ratio.
• Potential for Extreme Reverse Split Ratio: The approved range of 1-for-5 to 1-for-250 is very wide. A higher ratio, such as 1-for-250, would drastically reduce your share count and significantly increase the per-share price, often indicating severe financial distress.
• Significant Dilution Risk: The approval to issue shares for past funding means potentially millions of new common shares could enter the market. This could lead to substantial dilution of existing shares and downward pressure on the stock price.
• Reverse Splits as a Red Flag: While necessary for NASDAQ listing compliance, reverse stock splits do not solve underlying business problems. Historically, many companies that undergo reverse splits see their stock price decline again shortly after, as market sentiment often remains negative.
• Name Change Signals Strategic Pivot: The potential name change to "bitXbio, Inc." suggests a significant strategic shift. Investors should closely monitor for concrete details on this new strategy, including new business initiatives, target markets, and how the company plans to differentiate itself.
• Focus on Fundamentals: These corporate actions primarily address financial structure and corporate identity. Investors should continue to focus on Aditxt's (or bitXbio's) core business performance, including revenue generation, profitability, cash position, and burn rate, as these are the true drivers of long-term investment value.
• Expect Volatility: Corporate actions like a potential reverse stock split and significant share issuances can lead to increased stock price volatility. Investors should exercise caution and conduct thorough due diligence.