{"url_path":"/sec/foxo/10-q/2026/item-1a","section_key":"item-1a","section_title":"Item 1A RISK FACTORS**","topic":"sec","document":{"doc_type":"10-Q","doc_date":"2026-05-15","source_url":"https://www.sec.gov/Archives/edgar/data/1812360/0001493152-26-023461-index.html","accession_number":"0001493152-26-023461","cik":"0001812360","ticker":"FOXO","issuer_name":"FOXO TECHNOLOGIES INC.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1812360/0001493152-26-023461-index.html","primary_entity_key":"0001812360","primary_entity_name":"FOXO TECHNOLOGIES INC."},"word_count":805,"has_tables":true,"body_markdown":"**ITEM 1A. RISK FACTORS**\n\n \n\nOur business is subject to numerous risks and uncertainties,\nincluding those described in Part I, Item 1A, “Risk Factors,” in our Annual Report on Form 10-K for the fiscal year ended December\n31, 2025, filed with the SEC on April 15, 2026 (the “2025 Annual Report”). You should carefully consider the risk factors set\nforth in the 2025 Annual Report, as well as the following material changes to our risk factors since the filing of the 2025 Annual Report:\n\n \n\n54\n\n \n\n \n\n**FINRA has denied our application to process\na proposed reverse stock split, and the exhaustion of our FINRA-level appeal has created a material impediment to our ability to raise\ncapital.**\n\n \n\nOn September 2, 2025, RHI, a shareholder representing\na majority of the voting control of the Company, approved a proposal to amend our Certificate of Incorporation to effect a reverse stock\nsplit of our issued and outstanding Common Stock any time before July 31, 2026, at a ratio ranging from one-for-ten (1:10) to one-for-five\nhundred (1:500) with the exact ratio within such range to be determined at the sole discretion of the Company’s Board of Directors,\nwithout further approval or authorization of our stockholders before the filing of an amendment to the Certificate of Incorporation effecting\nthe proposed reverse split. The Company has filed an Information Statement on Schedule 14C with the SEC with respect to the matters approved\nby the Majority Stockholder and has mailed the definitive Information Statement on Schedule 14C to its stockholders of record as of the\nrecord date.\n\n \n\nOn September 25, 2025, the Company submitted a Company-Related\nNotification to FINRA’s Department of Market Operations in connection with a proposed reverse stock split. On March 6, 2026, the\nDepartment issued a deficiency notice pursuant to FINRA Rule 6490(d)(3), determining that the Company’s corporate action submission\nwould not be processed.\n\n \n\nThe Department’s determination was based, in\npart, on a pending SEC civil action against the managing partner of an institutional investor that holds shares of the Company’s\nSeries A Preferred Stock, as well as the Department’s view that, upon conversion of such preferred stock, the investor could own\napproximately 95% of the Company’s outstanding common stock, without giving effect to the beneficial ownership limitations contained\nin the terms of such securities.\n\n \n\nThe Company disagreed with the Department’s determination\nand, on March 12, 2026, filed a Notice of Appeal. On April 30, 2026, a subcommittee of FINRA’s Uniform Practice Code Committee (the “UPCC\nSubcommittee”) issued its final determination affirming the Department’s denial.\n\n \n\nAs a result of the UPCC Subcommittee’s\nfinal determination, the Company is currently unable to complete the proposed reverse stock split unless it resolves the underlying\nbasis for the denial. The inability to complete the reverse stock split may limit the Company’s ability to access capital,\nincluding under its existing $5.0 million equity line of credit under the Strata Purchase Agreement, which could materially\nadversely affect the Company’s liquidity and its ability to execute its business plan. The Company is currently evaluating its\noptions with respect to the UPCC Subcommittee’s determination, but there can be no assurance that the Company will be able to\nresolve the underlying basis for the denial or otherwise complete a reverse stock split. On May 12, 2026, the Company entered into\nexchange agreements with the institutional investors whose Series A Preferred Stock holdings were referenced in the\nDepartment’s determination, pursuant to which such investors exchanged their shares of Series A Preferred Stock for senior\nunsecured non-convertible promissory notes, as more fully described in Note 16 to the accompanying unaudited condensed consolidated\nfinancial statements. The Company plans to submit a new Company-Related Notification to FINRA’s Department of Market\nOperations in connection with a new, proposed reverse stock split.\n\n \n\n**Our former Chief Financial Officer resigned\nduring the first quarter citing concerns about our internal control environment, which may increase investor and regulatory scrutiny of\nour financial reporting.**\n\n \n\nOn March 18, 2026, Sylwia Nowak Hauman resigned as\nour Chief Financial Officer. Ms. Hauman’s resignation letter cited concerns regarding the Company’s internal control environment, financial\nreporting processes, and the resourcing of the finance and accounting team. The Company respectfully disagrees with the characterizations\nin Ms. Hauman’s resignation letter and believes the Company’s internal controls, reporting processes and staffing are adequate and have\nbeen significantly improved under current management. On March 24, 2026, the Company appointed Celene Laurene Rattray Grant (age 44) as\nChief Financial Officer. Notwithstanding Ms. Grant’s appointment, the concerns cited by the prior CFO may subject us to increased scrutiny\nby investors, regulators, or our auditors and could affect confidence in our financial reporting. The continued existence of material\nweaknesses in our internal controls, as disclosed in our 2025 Annual Report and as of March 31, 2026, means that our financial statements\nmay contain material misstatements that are not detected on a timely basis."}