9. Stockholders’ Equity

The Company’s current Amended and Restated Certificate of Incorporation dated February 18, 2014 authorizes the issuance of 130,000,000 shares of common stock and 20,000,000 shares of preferred stock, both with a par value of $0.001 per share. Of the preferred stock, 4,500,000 shares are designated Series A Preferred Stock and 491,222 shares are designated Series B Preferred Stock.

At-the-Market Offering Program

On May 4, 2023, the Company entered into an Equity Distribution Agreement to establish an at-the-market offering program, under which the Company may sell from time to time, at its option, shares of its common stock having an aggregate gross sales price of $5.5 million. The Company is required to pay the Sales Agents a commission of 3% of the gross proceeds from the sale of shares and has also agreed to provide the Sales Agents with customary indemnification rights. During the three and six months ended June 30, 2026 and 2025, no shares of the Company’s common stock were sold under the program. Per the terms of the Equity Distribution Agreement, no shares are available to be issued under the program as of June 30, 2026.

2025 Warrant Inducement

On March 11, 2025, the Company entered into a warrant exercise inducement offer letter agreement (the “Inducement Letter”) with the holder of the Series A New Warrants and Series B New Warrants (the “Existing Warrants”), pursuant to which, the holder agreed to exercise the Existing Warrants at a reduced exercise price of $43.75 per share in consideration for the Company’s agreement to issue (i) new unregistered five-year warrants (the “Series C-1 Warrants”) to purchase up to an aggregate of 69,878 shares of common stock at an exercise price of $43.75 per share and (ii) new unregistered three-year warrants (the “Series C-2 Warrants,” and together with the Series C-1 Warrants, the “New Warrants”) to purchase up to an aggregate of 34,939 shares of common stock at an exercise price of $43.75 per share (the “2025 Warrant Inducement”). The New Warrants were not exercisable without approval by the Company’s stockholders (the “Approval Date”), which was obtained on September 18, 2025. The Series C-1 Warrants are exercisable five years from the Approval Date, and the Series C-2 Warrants are exercisable three years from the Approval Date. Pursuant to the 2025 Warrant Inducement, the Company received proceeds, net of financial advisor fees and other transaction expenses, of $2,735. The incremental value of the consideration to the holders of the Existing Warrants was $5,113.

The Company filed a registration statement on Form S-1 on April 4, 2025 providing for the resale of the shares of common stock issuable upon the exercise of the New Warrants.

2025 Securities Purchase Agreements

On March 25, 2025, the Company entered into a securities purchase agreement for the issuance of 20,958 shares of its common stock (or common stock equivalents in lieu thereof) in a registered direct offering at a purchase price of $70.00 per share. In a concurrent private placement, the Company also agreed to issue to the same investor warrants to purchase up to 20,958 shares of its common stock at an exercise price of $70.00 per share, which will be exercisable immediately, and will expire five years following the date of issuance. Pursuant to the agreements, the Company received proceeds, net of financial advisor fees and other transaction expenses, of $1,234.

Also on March 25, 2025, the Company entered into a securities purchase agreement for the issuance of 36,329 shares of its common stock (or common stock equivalents in lieu thereof) in a registered direct offering at a purchase price of $70.00 per share. In a concurrent private placement, the Company also agreed to issue to the same investor warrants to purchase up to 36,329 shares of its common stock at an exercise price of $70.00 per share, which will be exercisable immediately, and will expire five years following the date of issuance. Pursuant to the agreements, the Company received proceeds, net of financial advisor fees and other transaction expenses, of $2,290.

Equity Awards

In 2012, the Board of Directors of the Company (the “Board”) approved the Tenon Medical, Inc. 2012 Equity Incentive Plan (the “2012 Plan”), which provided for the issuance of common stock options, appreciation rights, and other awards to employees, directors, and consultants. On January 10, 2022 and February 2, 2022, the Board and stockholders, respectively, of the Company approved the Tenon Medical, Inc. 2022 Equity Incentive Plan (the “2022 Plan”), which was effective on April 25, 2022. The 2022 Plan provided for the issuance of common stock options, stock appreciation rights, restricted stock, restricted stock units, and performance awards. Upon the effective date of the 2022 Plan, the Board terminated the 2012 Plan such that no new equity awards will be issued by the 2012 Plan.

A summary of the Company’s stock option and restricted stock unit activity under its plans is as follows:

The following table sets forth stock-based compensation expense recognized for the three and six months ended June 30, 2026 and 2025:

At June 30, 2026, there were 1,306 shares available for issuance under the 2022 Plan.

Warrants

IPO Warrants

In April 2022, in association with the Company’s initial public offering, the Company granted to The Benchmark Company, LLC and Valuable Capital Limited warrants to purchase a total of 35 shares of common stock. The warrants were immediately exercisable at an exercise price of $14,000.00 per share and expire on the fifth anniversary of the commencement of sales under the IPO. The fair value of the warrants on the grant date was $7,700.00 per warrant, which was calculated using a Black-Scholes option valuation model with an expected term of 5.00 years, expected volatility of 62.55%, dividend yield of 0%, and risk-free interest rate of 2.92%. The Company recorded the fair value of these warrants of $264 as an issuance cost to additional paid-in capital in 2022. All of the IPO warrants remain outstanding as of June 30, 2026.

Registered Offering Warrants

In June 2023, in connection with a registered offering of stock, the Company issued warrants to purchase a total of 7,143 shares of common stock (the “Registered Offering Warrants”). The Registered Offering Warrants were exercisable upon issuance and will expire five years from the date of issuance. Per the terms of the Registered Offering Warrants, the exercise price reset on July 16, 2023, to $880.88 per share. The fair value of the Registered Offering Warrants on the grant date of $3,164, or $442.40 per warrant, was calculated using a Monte-Carlo simulation to estimate the final exercise price, which is considered a Level 3 fair value measurement, using as inputs; the starting value of $840.00 per share, the Company’s VWAP on June 16; an assumed daily distribution of returns; a mean daily return of 5.18%; a short-term annual volatility of 100% and a standard deviation of 6.3%. The model used Black-Scholes to then calculate the estimated fair value of the Registered Offering Warrants, using an estimated time to maturity of 4.9 years, a risk-free interest rate of 3.99% and a long-term volatility of 60%. As of June 30, 2026, Registered Offering Warrants to purchase 5,929 shares of common stock remain outstanding.

Convertible Note Warrants

In November 2023, in connection with the issuance of the Convertible Notes, the Company issued warrants to purchase a total of 161 shares of common stock at an exercise price equal to $543.20 per share. The warrants expire five years from the issuance date. The fair value of the warrants on the grant date was $361.20 per warrant, which was calculated using a Black-Scholes option valuation model with an expected term of 5.00 years, expected volatility of 68.89%, dividend yield of 0%, and risk-free interest rate of 4.41%. The Company recorded the fair value of these warrants of approximately $58 as an issuance cost to additional paid-in capital in 2023. All of these warrants remain outstanding as of June 30, 2026.

Series A Preferred Stock Warrants

On February 20, 2024, in connection with the issuance of Series A Preferred Stock, the Company issued the Series A Warrants to purchase a total of 1,484 shares of common stock at an exercise price equal to $149.80 per share. The Series A Warrants are immediately exercisable and expire five years from the date of issuance. The fair value of the Series A Warrants on the grant date was $170.80 per warrant, which was calculated using a Black-Scholes option valuation model with an expected term of 5.00 years, expected volatility of 68.24%, dividend yield of 0%, and risk-free interest rate of 4.3%. The Company recorded the fair value of these warrants of $254 to additional paid-in capital in 2024. All of the Series A Preferred Stock warrants remain outstanding as of June 30, 2026.

Series B Preferred Stock Warrants

On September 5, 2024, in connection with the issuance of Series B Preferred Stock, the Company issued the Series B Warrants to purchase a total of 464 shares of common stock at an exercise price equal to $149.65 per share. The Series B Warrants are immediately exercisable and expire five years from the date of issuance. The fair value of the Series B Warrants on the grant date was $78.75 per warrant, which was calculated using a Black-Scholes option valuation model with an expected term of 5.00 years, expected volatility of 68.40%, dividend yield of 0%, and risk-free interest rate of 3.5%. The Company recorded the fair value of these warrants of $37 to additional paid-in capital in 2024. All of the Series B Preferred Stock warrants remain outstanding as of June 30, 2026.

Series C Warrants

On March 11, 2025, in connection with 2025 Warrant Inducement, the Company issued new unregistered five-year warrants (the “Series C-1 Warrants”) to purchase up to an aggregate of 69,878 shares of common stock at an exercise price of $43.75 per share and new unregistered three-year warrants (the “Series C-2 Warrants,” and together with the Series C-1 Warrants, the “Series C Warrants”) to purchase up to an aggregate of 34,939 shares of common stock at an exercise price of $43.75 per share. The Series C Warrants were exercisable upon approval by the Company’s stockholders, which was obtained on September 18, 2025 (the “Approval Date”). The Series C-1 Warrants are exercisable five years from the Approval Date, and the Series C-2 Warrants are exercisable three years from the Approval Date. Pursuant to the 2025 Warrant Inducement, the Company received proceeds, net of financial advisor fees and other transaction expenses, of $2,735.

The fair value of the Series C-1 Warrants on the grant date was $33.95 per warrant, which was calculated using a Black-Scholes option valuation model with an expected term of 5.00 years, expected volatility of 68.40%, dividend yield of 0%, and risk-free interest rate of 4.0%. The fair value of the Series C-2 Warrants on the grant date was $28.00 per warrant, which was calculated using a Black-Scholes option valuation model with an expected term of 3.00 years, expected volatility of 68.40%, dividend yield of 0%, and risk-free interest rate of 4.0%. The Company recorded the fair value of these warrants to additional paid-in capital in the first quarter of 2025. The Company recorded the excess of the incremental value of the modified Series A New Warrants and Series B New Warrants and the fair value of the Series C Warrants over the cash proceeds from the exercise of the modified Series A New Warrants and Series B New Warrants as equity offering costs. All of the Series C Warrants remain outstanding as of June 30, 2026.

Series D Warrants

On March 25, 2025, in connection with a securities purchase agreement, the Company issued warrants to purchase up to 20,958 shares of its common stock at an exercise price of $70.00 per share (the “Series D Warrants”), which were exercisable upon issuance, and will expire five years following the date of issuance. The fair value of the Series D Warrants on the grant date was $95.20 per warrant, which was calculated using a Black-Scholes option valuation model with an expected term of 5.00 years, expected volatility of 68.40%, dividend yield of 0%, and risk-free interest rate of 4.1%. The Company recorded the fair value of these warrants to additional paid-in capital in the first quarter of 2025. All of the Series D Warrants remain outstanding as of June 30, 2026.

Series E Warrants

Also on March 25, 2025, in connection with a securities purchase agreement, the Company issued warrants to purchase up to 36,329 shares of its common stock at an exercise price of $70.00 per share (the “Series E Warrants”), which were exercisable upon issuance, and will expire five years following the date of issuance. The fair value of the Series E Warrants on the grant date was $95.20 per warrant, which was calculated using a Black-Scholes option valuation model with an expected term of 5.00 years, expected volatility of 68.40%, dividend yield of 0%, and risk-free interest rate of 4.1%. The Company recorded the fair value of these warrants to additional paid-in capital in the first quarter of 2025. All of the Series E Warrants remain outstanding as of June 30, 2026.

PIPE Warrants

On November 11, 2025, in connection with entering into securities purchase agreements with certain accredited investors in an at-the-market private investment in public equity financing, the Company issued warrants to purchase 63,369 shares of its common stock at an exercise price of $40.60 per share, with an expiration date of 3 years from the date of issuance (the “PIPE Warrants”). The fair value of the PIPE Warrants on the grant date was $15.40 per warrant, which was calculated using a Black-Scholes option valuation model with an expected term of 3.00 years, expected volatility of 48.80%, dividend yield of 0%, and risk-free interest rate of 3.6%. The Company recorded the fair value of these warrants to additional paid-in capital. All of the PIPE Warrants remain outstanding as of June 30, 2026.