Aldeyra Therapeutics, Inc. 10-K

ITEM 9A. CONTROLS AND PROCEDURES Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures As of the end of the period covered by this annual report on Form 10-K, we carried out an evaluation under the supervision and with the participation of our Disclosure Committee and our management, including our Chief Executive Officer and our Head of Finance, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rules 13a-15(e) and 15d-15(e). Disclosure controls are procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, or the Exchange Act, such as this annual report on Form 10-K, is recorded, processed, summarized, and reported within the time periods specified by the United States Securities and Exchange Commission. Disclosure controls are also designed to ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and our Head of Finance, as appropriate to allow timely decisions regarding required disclosure. Our quarterly evaluation of disclosure controls includes an evaluation of some components of our internal control over financial reporting. We also perform a separate annual evaluation of internal control over financial reporting for the purpose of providing the management report below. The evaluation of our disclosure controls included a review of objectives and design, our implementation of the controls and the effect of the controls on the information generated for use in this annual report on Form 10-K. In the course of the control evaluations, we reviewed data errors or control problems identified and sought to confirm that appropriate corrective actions, including process improvements, were being undertaken. Evaluation of controls is performed on a quarterly basis so that the conclusions of management, including our Chief Executive Officer and our Head of Finance, concerning the effectiveness of the disclosure controls can be reported in our periodic reports on Form 10-Q and Form 10-K. The overall goal of our evaluation activities is to monitor our disclosure controls and to modify controls as necessary. We intend to maintain our disclosure controls as dynamic processes and procedures that we adjust as circumstances merit. Based on our management’s evaluation (with the participation of our Chief Executive Officer and our Head of Finance), as of the end of the period covered by this report, our Chief Executive Officer and our Head of Finance have concluded that our disclosure controls and procedures were effective. Management’s Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of 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 or procedures may deteriorate. Our management utilized the criteria established in the Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) to conduct an assessment of 100 the effectiveness of our internal control over financial reporting as of December 31, 2025. Based on the assessment, our management has concluded that, as of December 31, 2025, our internal control over financial reporting was effective. Attestation Report on Internal Control over Financial Reporting This annual report on Form 10-K does not include an attestation report of our independent registered public accounting firm because we qualified as a “smaller reporting company and non-accelerated filer.” Changes in Internal Control over Financial Reporting There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the fourth quarter of 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION Trading Arrangements During the three months ended December 31, 2025, neither we nor any of our directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted , modified or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act or any non-Rule 10b5-1 trading arrangement (as defined in the Securities and Exchange Commission’s rules). ITEM 9C. DISCLOS URE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable. 101 PART III ITEM 10. Directors, Executive Off icers, and Corporate Governance Except as set forth below, the information required by this item will be contained in our definitive proxy statement to be filed with the SEC in connection with our 2026 Annual Meeting of Stockholders within 120 days after the conclusion of our fiscal year ended December 31, 2025 (Proxy Statement), and is incorporated in this annual report on Form 10-K by reference. Code of Ethics and Business Conduct Our board of directors adopted a code of ethics and business conduct that applies to each of our directors, officers and employees. The full text of our code of business conduct is posted on the Corporate Governance portion of our website at http://ir.aldeyra.com/corporate-governance. Any waiver of the code of ethics and business conduct for an executive officer or director may be granted only by our board of directors or a committee thereof and must be timely disclosed as required by applicable law. We have implemented whistleblower procedures that establish format protocols for receiving and handling complaints from employees. Any concerns regarding accounting or auditing matters reported under these procedures will be communicated promptly to the Audit Committee. ITEM 11. Executiv e Compensation Other than with respect to the Securities Authorized for Issuance under Equity Incentive Plans contained in Item 12 below, the information required by this item will be contained in the Proxy Statement and is incorporated in this annual report on Form 10-K by reference. ITEM 12. Security Ownership of Certain Beneficial Own ers and Management and Related Stockholder Matters Securities Authorized for Issuance under Equity Incentive Plans The following table provides information as of December 31, 2025, with respect to shares of our common stock that may be issued, subject to certain vesting requirements, under our existing equity compensation plans, including our 2023 Equity Incentive Plan (2023 Equity Plan), 2013 Equity Incentive Plan (Amended 2013 Plan), and our 2016 Employee Stock Purchase Plan (2016 ESPP). A B C Plan Category 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) Equity compensation plans approved by security holders 8,856,979 (1) $ 5.50 (2) 6,228,048 (3) Equity compensation plans not approved by security holders — — — Total 8,856,979 (1) $ 5.50 (2) 6,228,048 (3) (1) Of these shares, 274,496 were underlying then outstanding restricted stock unit awards, 4,787,406 were subject to options then outstanding under the Amended 2013 Plan, and 3,795,077 were subject to options then outstanding under the 2023 Equity Plan. 102 (2) Does not take into account restricted stock units, which have no exercise price. (3) Represents 2,717,502 shares of common stock available for issuance under our 2023 Equity Plan and 3,510,546 shares of common stock available for issuance under our 2016 ESPP. No shares are available for future issuance under the Amended 2013 Plan. Our 2016 ESPP provides for annual increases in the number of shares available for issuance thereunder on the first business day of each fiscal year equal to the lesser of: (1) 1% of the shares of common stock outstanding at that time; and (2) such other amount as our board of directors may determine. On January 2, 2026, an additional 601,628 shares became available for future issuance under the 2016 ESPP. The additional shares from the annual increase on January 2, 2026 are not included in the table above. ITEM 13. Certain Relationships and Related Pa rty Transactions, and Director Independence The information required by this item will be contained in the Proxy Statement and is incorporated in this annual report on Form 10-K by reference. ITEM 14. Principal Accoun ting Fees and Services The information required by this item will be contained in the Proxy Statement and is incorporated in this annual report on Form 10-K by reference. 103 PART IV ITEM 15. Exhibits and Finan cial Statements Schedules The financial statements filed as part of this annual report on Form 10-K are listed in the Index to Financial Statements. Certain schedules are omitted because they are not applicable, or not required, or because the required information is included in the financial statements or notes thereto. The Exhibits are listed in the Exhibit Index below. EXHIBIT INDEX Exhibit Number Exhibit Title 3.1 Restated Certificate of Incorporation of Registrant, (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8‑K as filed on May 7, 2014, and incorporated herein by reference) 3.2 Amended and Restated Bylaws of the Registrant (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8‑K as filed on May 1, 2020, and incorporated herein by reference) 4.1 Specimen stock certificate evidencing the shares of common stock (filed as Exhibit 4.1 to Amendment No. 2 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-193204), as filed on March 17, 2014, and incorporated herein by reference) 4.2 Description of Securities (filed as Exhibit 4.6 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 (as filed on March 12, 2020, and incorporated herein by reference)) 10.1 Form of Indemnity Agreement for Directors and Officers (filed as Exhibit 10.1 to Amendment No. 2 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-193204), as filed on March 17, 2014, and incorporated herein by reference) 10.2† Offer Letter, effective as of August 1, 2013, between the Registrant and Todd C. Brady, M.D., Ph.D. (filed as Exhibit 10.2 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-193204), as filed on January 6, 2014, and incorporated herein by reference) 10.3† Offer Letter, effective November 29, 2013 between the Registrant and Todd C. Brady, M.D., Ph.D. (filed as Exhibit 10.4 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-193204), as filed on January 6, 2014, and incorporated herein by reference) 10.3(a)† Offer Letter Amendment, effective February 19, 2014 between the Registrant and Todd C. Brady, M.D., Ph.D. (filed as Exhibit 10.4(a) to Amendment No. 2 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-193204), as filed on March 17, 2014, and incorporated herein by reference) 10.4† 2010 Employee, Director and Consultant Equity Incentive Plan, as amended, and form of option agreement thereunder (filed as Exhibit 10.7 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-193204), as filed on January 6, 2014, and incorporated herein by reference) 10.5† 2013 Equity Incentive Plan and form of option agreement thereunder (filed as Exhibit 10.8 to Amendment No. 2 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-193204), as filed on March 17, 2014, and incorporated herein by reference) 10.5(a)† Form Notice of Stock Option Grant under the 2013 Equity Incentive Plan (filed as Exhibit 10.8(a) to Amendment No. 2 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-193204), as filed on March 17, 2014, and incorporated herein by reference) 10.5(b)† Form Notice of Stock Unit Award under the 2013 Equity Incentive Plan (filed as Exhibit 10.8(b) to Amendment No. 2 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-193204), as filed on March 17, 2014, and incorporated herein by reference) 104 10.6 Sublease dated September 12, 2014 between the Registrant and MacLean Power L.L.C. (filed as Exhibit 10.15 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 (as filed on November 12, 2014, and incorporated herein by reference)) 10.7 Sublease dated as of March 7, 2016 between Planck, LLC and the Registrant and Master Lease dated June 3, 2014 between WLC Three VI, L.L.C. and Plank, LLC (filed as Exhibit 10.24 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 (as filed on March 30, 2016, and incorporated herein by reference)) 10.8† Aldeyra Management Cash Incentive Plan (filed as Exhibit 10.25 to the Registrant’s Current Report on Form 8‑K as filed on March 18, 2016, and incorporated herein by reference) 10.9† Aldeyra Therapeutics, Inc. Amended and Restated Change in Control Plan (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021 (as filed on August 5, 2021, and incorporated herein by reference)) 10.10 Lease Agreement by and between WLC Three VI, L.L.C. and the Registrant, dated as of September 11, 2017 (filed as Exhibit 10.27 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 (as filed on November 9, 2017, and incorporated herein by reference)) 10.11 First Amendment to Lease between WLC Three VI, L.L.C. and the Registrant, dated as of November 27, 2017 (filed as Exhibit 10.28 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 (as filed on March 29, 2018, and incorporated herein by reference)) 10.12 Second Amendment to Lease between WLC Three VI, L.L.C. and the Registrant, dated as of October 7, 2020 (filed as Exhibit 10.33 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020 (as filed on November 5, 2020 and incorporated herein by reference)) 10.13 Third Amendment to Lease between WLC Three VI, L.L.C. and the Registrant, dated as of August 12, 2021 (filed as Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 (as filed on October 26, 2021 and incorporated herein by reference)) 10.14 Fourth Amendment to Lease between WLC Three VI, L.L.C. and the Registrant, dated as of November 22, 2023 (filed as Exhibit 10.14 to the Registrant’s Annual Report on Form 10-K (as filed on March 7, 2024, and incorporated herein by reference)) 10.15 Fifth Amendment to Lease between WLC Three VI, L.L.C. and the Registrant, dated as of April 29, 2024 (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 (as filed on August 1, 2024 and incorporated herein by reference)) 10.16 Sixth Amendment to Lease between WLC Three VI, L.L.C. and the Registrant, dated as of April 1,2025 (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 (as filed on August 5, 2025 and incorporated herein by reference)) 10.17† Amendment No. 1 to the Aldeyra Therapeutics, Inc. 2013 Equity Incentive Plan (filed as Exhibit 10.26 to the Registrant’s Quarterly Report on Form 10-Q (as filed on August 10, 2016, and incorporated herein by reference)) 10.18† Amendment No. 2 to the Aldeyra Therapeutics, Inc. 2013 Equity Incentive Plan (filed as Exhibit 10.29 to the Registrant’s Quarterly Form 10-Q (as filed on August 9, 2018, and incorporated herein by reference)) 10.19† Aldeyra Therapeutics, Inc. 2016 Employee Stock Purchase Plan (filed as Exhibit 10.27 to the Registrant’s Quarterly Report on Form 10-Q (as filed on August 10, 2016, and incorporated herein by reference)) 105 10.20 Agreement and Plan of Merger, dated as of January 24, 2019, by and among Aldeyra Therapeutics, Inc., Helio Vision, Inc., Halo Merger Sub, Inc., Halo Merger Sub, LLC and Josef von Rickenbach, as the Securityholder Representative (filed as Exhibit 2.1 to the Registrant’s Current Report on Form 8‑K (as filed on January 29, 2019, and incorporated herein by reference)) 10.21† Offer Letter, effective as of October 21, 2015, between the Registrant and Stephen Machatha, Ph.D.(filed as Exhibit 10.19 to the Registrant’s Annual Report on Form 10-K (as filed on March 17, 2022, and incorporated herein by reference)) 10.21(a)† Offer Letter Amendment No. 1, effective as of January 1, 2018, between the Registrant and Stephen Machatha, Ph.D. (filed as Exhibit 10.19(a) to the Registrant’s Annual Report on Form 10-K (as filed on March 17, 2022, and incorporated herein by reference)) 10.21(b)† Offer Letter Amendment No. 2, effective as of March 23, 2021, between the Registrant and Stephen Machatha, Ph.D. (filed as Exhibit 10.19(b) to the Registrant’s Annual Report on Form 10-K (as filed on March 17, 2022, and incorporated herein by reference)) 10.22 Loan and Security Agreement, dated as of March 25, 2019, by and among the Registrant, certain subsidiaries of the Registrant from time to time party thereto, the several banks and other financial institutions or entities from time to time parties thereto and Hercules Capital, Inc. (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8‑K (as filed on March 26, 2019, and incorporated herein by reference)) 10.23 First Amendment to Loan and Security Agreement, dated April 20, 2021, by and among the Registrant, Helio Vision, LLC, the several banks and other financial institutions or entities from time to time parties thereto and Hercules Capital, Inc. (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8‑K as filed on April 21, 2021, and incorporated herein by reference) 10.24 Second Amendment to Loan and Security Agreement, dated December 22, 2022 and effective as of December 31, 2022, by and among the Registrant, Helio Vision, LLC, the several banks and other financial institutions or entities from time to time parties thereto and Hercules Capital, Inc. (filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8‑K as filed on December 27, 2022, and incorporated herein by reference). 10.25 Third Amendment to Loan and Security Agreement, dated April 29, 2024, by and among the Registrant, Helio Vision, LLC, the several banks and other financial institutions or entities from time to time parties thereto and Hercules Capital, Inc. (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8‑K as filed on December 27, 2022, and incorporated herein by reference). 10.26 Fourth Amendment to Loan and Security Agreement, dated September 30, 2024, by and among the Registrant, Helio Vision, LLC, the several banks and other financial institutions or entities from time to time parties thereto and Hercules Capital, Inc. (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 (as filed on August 1, 2024, and incorporated herein by reference)). 10.27 Fifth Amendment to Loan and Security Agreement, dated October 28, 2024, by and among the Registrant, Helio Vision, LLC, the several banks and other financial institutions or entities from time to time parties thereto and Hercules Capital, Inc. 10.28+ Exclusive Option Agreement, between the Registrant and AbbVie Inc., dated as of October 31, 2023 (filed as Exhibit 10.26 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (as filed on March 7, 2024, and incorporated herein by reference)) 10.29+ Expansion Side Letter Agreement: Aldeyra & AbbVie Collaboration Update 10.30† Aldeyra Therapeutics, Inc. 2023 Equity Incentive Plan, form of option agreement, and form of RSU agreement thereunder (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 (as filed on August 3, 2023, and incorporated herein by reference)) 106 10.31† Transition Agreement, effective December 23, 2025, between the Registrant and Stephen G. Machattha, Ph.D. (filed as item 5.02 as filed on December 23, 2025 on Form 8‑K, and incorporated herein by reference) 19.1* Aldeyra Therapeutics, Inc. Amended and Restated Insider Trading Policy 21.1* Subsidiaries of Aldeyra Therapeutics, Inc. 23.1* Consent of BDO USA, P.C. independent registered public accounting firm 31.1* Certification of the Chief Executive Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 31.2* Certification of the Chief Financial Officer as required by Section 302 of the Sarbanes-Oxley Act of 2002 32.1* Certifications of the Chief Executive Officer and Chief Financial Officer as required by 18 U.S.C. 1350 97 Aldeyra Therapeutics, Inc. Policy for the Recovery of Erroneously Awarded Compensation 101.INS* Inline XBRL Instance Document 101.SCH* Inline XBRL Taxonomy Extension Schema Document 101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) † Compensation Arrangement. ‡ Confidential treatment has been granted with respect to certain portions of this document. * Filed herewith. ** Certain information (indicated by “*****”) has been excluded from this exhibit because it is both not material and would likely cause competitive harm to the Company if publicly disclosed. + In accordance with Item 601(b)(10)(iv) certain information (indicated by “[****]”) has been excluded from this exhibit because it is both not material and is the type that the Company treats as private or confidential. The Exhibits listed in the Exhibit Index are filed as part of this annual report on Form 10-K. ITEM 16. Form 10-K Summary None. 107 Signat ures Pursuant to the requirements of Section 13 and 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this annual report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized, in the Commonwealth of Massachusetts, on February 27, 2026. ALDEYRA THERAPEUTICS, INC. By: /s/ Todd C. Brady, M.D., Ph.D. Todd C. Brady, M.D., Ph.D. President and Chief Executive Officer POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS , that each person whose signature appears below hereby constitutes and appoints Todd C. Brady and Michael Alfieri, and each of them, as his or her true and lawful attorneys-in-fact, proxies, and agents, each with full power of substitution, for him 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 other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact, proxies, and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact, proxies, and agents, or their or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1934, this annual report on Form 10-K 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/ Todd C. Brady, M.D., Ph.D. Chief Executive Officer and Director February 27, 2026 Todd C. Brady, M.D., Ph.D. (principal executive officer) /s/ Michael Alfieri Head of Finance February 27, 2026 Michael Alfieri (principal financial and accounting officer) /s/ Richard H. Douglas, Ph. D. Chairman of the Board of Directors February 27, 2026 Richard H. Douglas, Ph.D. /s/ Ben Bronstein, M.D. Director February 27, 2026 Ben Bronstein, M.D. /s/ William Clark Director February 27, 2026 William Clark /s/ Martin J. Joyce Director February 27, 2026 Martin J. Joyce /s/ Nancy Miller-Rich Director February 27, 2026 Nancy Miller-Rich /s/ Gary Phillips, M.D. Director February 27, 2026 Gary Phillips, M.D. /s/ Neal Walker, D.O. Director February 27, 2026 Neal Walker, D.O. 108 ALDEYRA THERAPEUTICS, INC. INDEX TO CONSOLIDATED FINANCI AL STATEMENTS Page ITEM 1. Reports of Independent Registered Public Accounting Firm (BDO USA, P.C. Boston, Massachusetts, PCAOB # 243 ) 110 Consolidated Balance Sheets at December 31, 2025 and 2024 112 Consolidated Statements of Operations for the years ended December 31, 2025 and 2024 113 Consolidated Statements of Comprehensive Loss for the years ended December 31, 2025 and 2024 114 Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2025 and 2024 115 Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024 116 Notes to Consolidated Financial Statements 117 109 REPORT OF INDEPENDENT RE GISTERED PUBLIC ACCOUNTING FIRM Stockholders and Board of Directors Aldeyra Therapeutics, Inc. Lexington, Massachusetts Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Aldeyra Therapeutics, Inc. (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive loss, stockholders’ equity, and cash flows for each of the years 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 at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. 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 audits 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 audits 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 audits 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 audits 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 audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Estimation of Accrued or Deferred Research & Development Clinical Trial Expenses As described in Notes 2, 7 and 8 to the consolidated financial statements, the Company’s deferred research and development expenses and accrued research and development expenses totaled approximately $1.0 million and $1.3 million, respectively, as of December 31, 2025. A portion of the accrued research and development expenses and the deferred research and development expenses relate to clinical trial activities. Clinical trial activities pertain 110 to third-party services, including subject-related fees at the sites where the Company’s clinical trials are being conducted and investigator fees, amongst other costs. Costs associated with these clinical trial expenses are generally payable on the passage of time or when certain milestones are achieved. Accrued liabilities are recorded related to those clinical trial expenses for which vendors have not yet billed the Company with respect to services provided that the Company has received. The accrual for these clinical trial expenses is based on such assumptions as total costs incurred to date, the number of subjects and clinical trial sites and length of the study. Payments made by the Company in advance for clinical trial services not yet provided and/or for materials not yet received are recorded as deferred research and development expenses. Actual results may differ from these estimates. We identified the determination of accrued clinical trial expenses for certain contracts and deferred clinical trial expenses for certain contracts as a critical audit matter. Estimating accrued and deferred clinical trial expenses for certain contracts requires significant judgment due to the use of subjective assumptions related to total costs incurred to date, the number of subjects and clinical trial sites and length of the study. Auditing these elements involved especially challenging and subjective auditor judgment due to the nature and extent of auditor effort required to address the matter. The primary procedures we performed to address this critical audit matter included: • Evaluating the reasonableness of certain assumptions related to total costs incurred to date, the number of subjects, and length of the study for certain contracts, by: i) confirming clinical total costs incurred to date, contracted fees and total amounts billed with the clinical vendors to evaluate the completeness of costs in the estimates, ii) interviewing respective clinical operations personnel to obtain information related to the progress of the projects, iii) assessing original clinical vendor contract terms and change orders for the certain contracts, including the expected timeline for the related study, iv) evaluating the consistency of those assumptions for certain contracts with the Company’s press releases and other public information and v) evaluating patient enrollment progress. • Testing the completeness and accuracy of the clinical costs and total amounts billed with the clinical vendors used in the estimate of accrued and deferred clinical trial expenses for certain contracts by inspecting on a sample basis invoices received from and payments made by the Company to clinical vendors throughout the year and comparing invoice and payment amounts to the related contract details. /s/ BDO USA, P.C. We have served as the Company’s auditor since 2013. Boston, Massachusetts February 27, 2026 111 ALDEYRA THERAPEUTICS, INC. CONSOLIDATED B ALANCE SHEETS December 31, December 31, 2025 2024 ASSETS Current assets: Cash and cash equivalents $ 70,041,254 $ 54,527,092 Marketable securities — 46,624,180 Prepaid expenses and other current assets 1,742,202 2,921,206 Total current assets 71,783,456 104,072,478 Deferred offering costs — 267,261 Right-of-use assets 275,861 266,955 Total assets $ 72,059,317 $ 104,606,694 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 158,461 $ 180,453 Accrued expenses 6,120,297 12,118,367 Current portion of debt 15,249,632 31,372 Operating lease liabilities 280,537 271,631 Deferred collaboration revenue 6,000,000 6,000,000 Total current liabilities 27,808,927 18,601,823 Long-term debt, net of current portion — 15,000,000 Total liabilities 27,808,927 33,601,823 Commitments and contingencies (Notes 3, 9, & 13) Stockholders' equity: Preferred stock, $ 0.001 par value, 15,000,000 shares authorized, none issued and outstanding — — Common stock, voting, $ 0.001 par value; 150,000,000 authorized and 60,162,773 and 59,648,278 shares issued and outstanding, respectively 60,163 59,648 Additional paid-in capital 528,147,480 521,018,373 Accumulated other comprehensive income — 37,442 Accumulated deficit ( 483,957,253 ) ( 450,110,592 ) Total stockholders’ equity 44,250,390 71,004,871 Total liabilities and stockholders’ equity $ 72,059,317 $ 104,606,694 The accompanying notes are an integral part of these consolidated financial statements. 112 ALDEYRA THERAPEUTICS, INC. CONSOLIDATED STATEM ENTS OF OPERATIONS Years ended December 31, 2025 2024 Operating expenses: Research and development $ 25,662,855 $ 48,224,793 General and administrative 9,602,351 11,892,239 Loss from operations ( 35,265,206 ) ( 60,117,032 ) Other income (expense): Interest income 3,323,855 6,191,829 Interest expense ( 1,905,310 ) ( 1,926,241 ) Total other income, net 1,418,545 4,265,588 Net loss $ ( 33,846,661 ) $ ( 55,851,444 ) Net loss per share - basic and diluted $ ( 0.56 ) $ ( 0.94 ) Weighted average common shares outstanding - basic and diluted 60,056,557 59,484,794 The accompanying notes are an integral part of these consolidated financial statements. 113 ALDEYRA THERAPEUTICS, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS Years ended December 31, 2025 2024 Net loss $ ( 33,846,661 ) $ ( 55,851,444 ) Other comprehensive income (loss): Net unrealized gain on marketable securities, net of tax — 37,442 Reclassification adjustment for gains included in net loss, net of tax ( 37,442 ) — Total other comprehensive income (loss) ( 37,442 ) 37,442 Comprehensive loss $ ( 33,884,103 ) $ ( 55,814,002 ) The accompanying notes are an integral part of these consolidated financial statements. 114 ALDEYRA THERAPEUTICS, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY Stockholders' Equity Common Voting Stock Accumulated Shares Amount Additional Paid-in Capital Other Comprehensive Income/(Loss), net of tax Accumulated Deficit Total Stockholders' Equity Balance, December 31, 2023 59,195,951 $ 59,196 $ 513,994,982 $ — $ ( 394,259,148 ) $ 119,795,030 Stock-based compensation — — 6,635,504 — — 6,635,504 Issuance of common stock, exercise of stock options 98,680 98 350,181 — — 350,279 Issuance of common stock, employee stock purchase plan 13,159 14 38,046 — — 38,060 Issuance of common stock, vested restricted stock unit awards 340,488 340 ( 340 ) — — — Other comprehensive income — — — 37,442 — 37,442 Net loss ( 55,851,444 ) ( 55,851,444 ) Balance, December 31, 2024 59,648,278 59,648 521,018,373 37,442 ( 450,110,592 ) 71,004,871 Stock-based compensation 6,006,066 6,006,066 Issuance of common stock, exercise of stock options 274,158 275 1,103,665 — — 1,103,940 Issuance of common stock, employee stock purchase plan 7,101 7 19,609 — — 19,616 Issuance of common stock, vested restricted stock unit awards 233,236 233 ( 233 ) — — — Other comprehensive income (loss) — — — ( 37,442 ) ( 37,442 ) Net loss ( 33,846,661 ) ( 33,846,661 ) Balance, December 31, 2025 60,162,773 $ 60,163 $ 528,147,480 $ — $ ( 483,957,253 ) $ 44,250,390 The accompanying notes are an integral part of these consolidated financial statements. 115 ALDEYRA THERAPEUTICS, INC. CONSOLIDATED STATEME NTS OF CASH FLOWS Years ended December 31, 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ ( 33,846,661 ) $ ( 55,851,444 ) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation 6,091,413 7,973,499 Non-cash interest expense 218,260 177,326 Net amortization of premium on marketable securities ( 1,149,550 ) ( 1,670,983 ) Depreciation and amortization expense 251,993 249,623 Write-off of deferred offering costs 267,261 — Change in operating assets and liabilities: Prepaid expenses and other current assets 1,179,004 2,066,111 Accounts payable ( 21,992 ) ( 1,157,604 ) Accrued expenses and other liabilities ( 6,335,410 ) 5,004,725 Net cash used in operating activities ( 33,345,682 ) ( 43,208,747 ) CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of marketable securities ( 40,263,712 ) ( 96,915,755 ) Maturities of marketable securities 88,000,000 52,000,000 Net cash provided by (used in) investing activities 47,736,288 ( 44,915,755 ) CASH FLOWS FROM FINANCING ACTIVITIES: Issuance costs — ( 267,261 ) Proceeds from exercise of stock options 1,103,940 350,279 Proceeds from employee stock purchase plan 19,616 38,060 Debt end of term charge paid in cash — ( 292,500 ) Net cash provided by (used in) financing activities 1,123,556 ( 171,422 ) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 15,514,162 ( 88,295,924 ) CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 54,527,092 142,823,016 CASH AND CASH EQUIVALENTS, END OF PERIOD $ 70,041,254 $ 54,527,092 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the period for interest $ 1,688,125 $ 1,753,792 The accompanying notes are an integral part of these consolidated financial statements. 116 ALDEYRA THERAP EUTICS, INC. NOTES TO THE CONSOLIDATE D FINANCIAL STATEMENTS 1. NATURE OF BUSINESS Aldeyra Therapeutics, Inc. (Aldeyra, Company, we, us and our) was incorporated in the state of Delaware on August 13, 2004 as Neuron Systems, Inc. On December 20, 2012, the Company changed its name to Aldexa Therapeutics, Inc. and, on March 17, 2014, the Company changed its name to Aldeyra Therapeutics, Inc. Aldeyra, together with its wholly-owned subsidiaries, is a clinical-stage biotechnology company devoted to discovering innovative therapies designed to treat immune-mediated diseases. The Company’s principal activities to date include research and development activities along with related general business planning, including raising capital. 2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Consolidation – The accompanying consolidated financial statements were prepared in conformity with accounting principles generally accepted in the United States of America (US GAAP) and pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). The Company’s consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated. Risks and Uncertainties –The ongoing research and development activities will be subject to extensive regulation by numerous governmental authorities in the United States. Prior to marketing in the United States, any drug developed by the Company must undergo rigorous preclinical and clinical testing and an extensive regulatory approval process implemented by the United States Food and Drug Administration (FDA) under the Food, Drug and Cosmetic Act. Because of the numerous risks and uncertainties associated with research, development and commercialization of our product candidates, there can be no assurance that the Company will not encounter problems in the clinical trials that will cause the Company or the FDA to delay or suspend clinical trials. The Company’s success will depend in part on its ability to obtain patents and product license rights, maintain trade secrets, and operate without infringing on the property rights of others, both in the United States and other countries. There can be no assurance that patents issued to or licensed by the Company will not be challenged, invalidated, circumvented, or that the rights granted thereunder will provide proprietary protection or competitive advantages to the Company. Based on the Company's current operating plan, the Company believes that its cash and cash equivalents will be sufficient to fund the Company’s currently projected operating expenses and debt obligations for at least the next 12 months from the date the financial statements are issued. The Company has based its projections of operating capital requirements on its current operating plan, which includes several assumptions that may prove to be incorrect, and the Company may use all of its available capital resources sooner than the Company expects. The Company will need to secure additional funding in the future, from one or more equity or debt financings, collaborations, or other sources, in order to carry out all of the Company’s planned research and development activities and regulatory activities; commence or continue ongoing commercialization activities, including manufacturing, sales, marketing and distribution, for any of its product candidates for which the Company may receive marketing approval; or conduct any substantial, additional development requirements requested by the FDA. Additional funding may not be available to the Company on acceptable terms, or at all. If the Company is unable to secure additional funding, it could be forced to delay, reduce or eliminate its research and development programs and its reproxalap commercialization efforts. Curtailment of operations would cause significant delays in the Company’s efforts to develop and introduce its products to market, which is critical to the realization of its business plan and the future operations of the Company. Use of Estimates – The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions, including fair value estimates for investments, that affect the reported amounts of assets, liabilities, and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. The Company evaluates its estimates and assumptions on an ongoing basis. The most significant estimates in the Company’s 117 consolidated financial statements include, but are not limited to deferred and accrued research and development costs, stock-based compensation, and accounting for income taxes and related valuation allowance. Although these estimates and assumptions are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may ultimately materially differ from these estimates and assumptions. Loss Contingencies – The outcome of loss contingencies, legal proceedings, indemnification matters, and claims brought against us is subject to uncertainty. An estimated loss contingency is accrued by a charge to earnings if it is probable that an asset has been impaired or a liability has been incurred and the amount can be reasonably estimated. Determination of whether to accrue a loss requires evaluation of the probability of an unfavorable outcome and the ability to make a reasonable estimate. Changes in these estimates could affect the timing and amount of accrual of loss contingencies and could be material to the financial statements. Legal costs associated with legal proceedings are expensed as incurred and are included in general and administrative expenses in the accompanying consolidated statements of operations. Segment Information – Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company views its operations and manages its business in one segment, which is the identification and development of next-generation medicines to improve the lives of patients with immune-mediated diseases. Cash and Cash Equivalents – The Company classifies all highly liquid investments with original maturities of three months or less as cash equivalents and all highly liquid investments with original maturities of greater than three months but less than 12 months as current marketable securities. The Company has a policy of making investments only with commercial institutions that have at least an investment grade credit rating. The Company invests its cash primarily in government securities and obligations and money market funds. Marketable Securities – Marketable securities consist of government securities and obligations with original maturities of more than 90 days . Debt investments are classified as available-for-sale and are recorded on the balance sheet at fair value with unrealized gains or losses reported as a separate component of other comprehensive income/(loss). Management determines the appropriate classification of its investments at the time of purchase and re-evaluates such determination at each balance sheet date. At each balance sheet date, the Company assesses available-for-sale securities in an unrealized loss position to determine whether the decline in fair value below amortized cost is a result of credit losses or other factors, whether the Company expects to recover the amortized cost of the security, the Company’s intent to sell and if it is more likely than not that the Company will be required to sell the securities before the recovery of amortized cost. The Company records changes in allowance for expected credit loss in other income (expense). There has been no allowance for expected credit losses recorded during any of the periods presented. Fair Value of Financial Instruments – Financial instruments including cash equivalents and accounts payable are carried in the financial statements at amounts that approximate their fair value based on the short maturities of those instruments. Marketable securities are carried at fair value and are more fully described in Note 6. The carrying amount of the Company’s credit facility with Hercules Capital, Inc. approximates fair value since the effective interest rate approximates market rates currently available to the Company. Concentration of Credit Risk – Financial instruments that potentially subject the Company to significant concentrations of credit risk principally consist of cash, cash equivalents and marketable securities, if any. The Company places its cash and cash equivalents and marketable securities with financial institutions which management believes have high credit ratings and may hold some amounts exceeding federally insured limits. As part of its cash and investment management processes, the Company performs periodic evaluations of the credit standing of the financial institutions with whom it maintains deposits. Intellectual Property – The legal and professional costs incurred by the Company to acquire its patent rights are expensed as incurred and included in general and administrative expenses. At December 31, 2025 and 2024, the Company has determined that these expenses have not met the criteria to be capitalized since the future benefits to be derived from the patents is uncertain. Intellectual property related expenses for the years ended December 31, 2025 and 2024 were $ 0.6 million and $ 1.0 million, respectively. Collaborative Arrangements – The Company analyzes its collaboration arrangements to assess whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities 118 and exposed to significant risks and rewards dependent on the commercial success of such activities and therefore within the scope of Accounting Standards Codification (ASC) 808, Collaborative Arrangements (ASC 808). The ASC 808 assessment is performed throughout the life of the arrangement based on changes in the responsibilities of all parties in the arrangement. For collaboration arrangements within the scope of ASC 808 that contain units of account, the Company first determines which units of account of the collaboration are more reflective of a vendor-customer relationship and therefore within the scope of ASC 606, Revenue from Contracts with Customers (ASC 606), if any, and which units of may be subject to other specific recognition guidance, if any. For units of account of collaboration arrangements that are accounted for pursuant to ASC 808, and not subject to other specific recognition guidance, an appropriate recognition method is determined and applied consistently, either by analogy to authoritative accounting literature or by applying a reasonable and rational policy election. For collaboration arrangements that are within the scope of ASC 808, the Company evaluates the income statement classification for presentation of amounts due from or owed to other participants associated with multiple activities in a collaboration arrangement based on the nature of each separate activity. Payments or reimbursements that are the result of a collaborative relationship instead of a customer relationship, such as co-development and co-commercialization activities, are recorded as research and development expense or selling, general and administrative expense, in the event of a payment to the collaborative partner in a period, or a reduction to these expense line items in the event of a reimbursement from the collaboration partner in a period, as appropriate. Income Taxes – The Company follows the provisions of Financial Accounting Standards Board (FASB) ASC 740, Income Taxes (ASC 740), in reporting deferred income taxes. ASC 740 requires a company to recognize deferred tax liabilities and assets for expected future income tax consequences of events that have been recognized in the Company’s consolidated financial statements. Under the ASC 740 method, deferred tax assets and liabilities are determined based on temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates in the years in which the temporary differences are expected to reverse. Valuation allowances are provided if based on the weight of available evidence, it is more likely than not that some or all the deferred tax assets will not be realized. The Company accounts for uncertain tax positions pursuant to ASC 740 which prescribes a recognition threshold and measurement process for financial statement recognition of uncertain tax positions taken or expected to be taken in a tax return. If the tax position meets the threshold, the benefit to be recognized is measured as the tax benefit having the highest likelihood of being realized upon ultimate settlement with the taxing authority. The Company recognizes interest accrued related to unrecognized tax benefits and penalties in the provision for income taxes. Management is not aware of any uncertain tax positions. Research and Development Costs – Research and development (R&D) costs are charged to expense as incurred and relate to salaries, employee benefits, stock-based compensation related to employees, consulting services, other operating costs and expenses associated with preclinical and clinical trial activities. Payments made by the Company in advance for research and development services not yet provided and/or for materials not yet received are recorded as prepaid research and development expenses. Accrued liabilities are recorded related to those expenses for which vendors have not yet billed us with respect to services provided and/or materials that we have received. Preclinical and clinical trial expenses relate to third-party services, subject-related fees at the sites where the Company’s clinical trials are being conducted, laboratory costs, analysis costs, toxicology studies and investigator fees. Costs associated with these expenses are generally payable on the passage of time or when certain milestones are achieved. Expense is recorded during the period incurred or in the period in which a milestone is achieved. In order to ensure that the Company has adequately provided for preclinical and clinical expenses during the proper period, the Company maintains an accrual for these expenses. These accruals are assessed on a quarterly basis and are based on such assumptions as total costs incurred to date, the number of subjects and clinical trial sites and length of the study. Actual results may differ from these estimates and could have a material impact on the Company’s reported results. The Company’s historical accrual estimates have not been materially different from actual costs. Stock-Based Compensation – Stock-based payments are accounted for in accordance with the provisions of ASC 718, Compensation – Stock Compensation . For options, the fair value of stock-based payments is estimated, on the date of grant, using the Black-Scholes option pricing model. For restricted stock units, fair value is based on the fair value of the underlying stock on the date of grant. The resulting fair value for restricted stock units and options expected to vest is recognized on a straight-line basis over the requisite service period, which is generally the vesting 119 period of the applicable restricted stock units or options. The Company records the effect of forfeitures and cancellations when they occur. For performance-based awards, at each reporting period we assess the probability that the performance condition(s) will be achieved. We use the accelerated attribution method to expense the awards over the continuous service period based on the probability of achieving the performance conditions. We estimate the continuous service period based on our best estimate of the period over which an award’s vesting condition(s) will be achieved. We review and evaluate these estimates on a quarterly basis. The Company has cash awards and performance cash settled bonus awards, which are awards that will be settled in cash on their vesting dates (Liability Awards), rather than in equity units. The fair value of Liability Awards is updated at each balance sheet date and changes in the fair value of the vested portions of the Liability Awards are recorded as increases or decreases to compensation expense. The Company recognizes forfeitures as they occur. Comprehensive Loss – Comprehensive loss is defined as the change in equity during a period from transactions and other events and/or circumstances from non-owner sources. For December 31, 2025, comprehensive loss is equal to the Company’s net loss of $ 33.8 million and reclassification of gains on marketable securities to net loss of less than $ 0.1 million. For December 31, 2024, comprehensive loss is equal to the Company's net loss of $ 55.9 million and unrealized gain on marketable securities of less than $ 0.1 million. Net Loss Per Share – Basic earnings per share is calculated by dividing net loss allocable to common stockholders by the weighted average number of common stock outstanding during the period, excluding the effects of any potentially dilutive instruments. Diluted net loss per share is computed using the more dilutive of (a) the two-class method, or (b) treasury stock method, as applicable, to the potentially dilutive instruments. The weighted-average number of common shares outstanding gives effect to all potentially dilutive common equivalent shares, including outstanding stock options and restricted stock units, warrants, if any, and nonvested shares. Recent Accounting Pronouncements – In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (ASU 2023-09). ASU 2023-09 requires more detailed income tax disclosures. The guidance requires entities to disclose disaggregated information about their effective tax rate reconciliation as well as expanded information on income taxes paid by jurisdiction. The disclosure requirements will be applied on a prospective basis, with the option to apply them retrospectively. The Company adopted ASU 2023-09 prospectively in 2025 and it did not have a material impact on the Company's consolidated financial statements. See Note 11 for more information on the effects of the adoption of ASU 2023-09. In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses (ASU 2024-03). ASU 2024-03 requires public business entities to disclose in the notes to the financial statements, among other things, specific information about certain costs and expenses including purchases of inventory; employee compensation; and depreciation, amortization and depletion expenses for each caption on the income statement where such expenses are included. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted, and the amendments may be applied prospectively to reporting periods after the effective date or retrospectively to all periods presented in the financial statements. The Company is evaluating the impact of ASU 2024-03 on the Company's consolidated financial statements. 3. HELIO VISION ACQUISITION On January 28, 2019 (Closing Date), the Company acquired Helio Vision, Inc. (Helio) and thereby obtained rights to develop ADX‑2191 for the treatment of proliferative vitreoretinopathy (the Helio Product Candidate) pursuant to an Agreement and Plan of Merger dated as of January 24, 2019 (the Merger Agreement). As a result of the acquisition, the Company issued an aggregate of 1,407,006 shares of common stock to the former securityholders and an advisor of Helio, including 246,562 shares issued in January 2021, pursuant to the terms of the acquisition agreement. In addition, the Company, subject to the conditions of the acquisition agreement, was contingently obligated to make additional payments to the former securityholders of Helio as follows: (a) $ 10.0 million of common stock following approval by the FDA of a new drug application (NDA) for the prevention and/or treatment of proliferative vitreoretinopathy or a substantially similar label prior to the 10th anniversary of the Closing Date; and (b) $ 2.5 million of common stock following FDA approval of an NDA for an indication (other 120 than proliferative vitreoretinopathy or a substantially similar label) prior to the 12th anniversary of the Closing Date (the shares of common stock issuable pursuant to the preceding clauses (a) and (b) are referred to herein as the Milestone Shares), provided that in no event shall the Company be obligated to issue more than an aggregate of 5,248,885 shares of common stock in connection with the Helio acquisition. During the year ended December 31, 2024, the Company ceased development of the Helio Product Candidate for the treatment of proliferative vitreoretinopathy. As a result, subject to the terms and conditions of the Merger Agreement, the Helio Product Candidate and related intellectual property rights may revert to an entity designated by the representative of the former Helio stockholders. Additionally, in the event of certain change of control or divestitures by the Company, certain former convertible noteholders of Helio will be entitled to a tax gross-up payment in an amount not to exceed $ 1.0 million in the aggregate. The Company determined that liability accounting is not required for the Milestone Shares under ASC Topic 480, Distinguishing Liabilities from Equity (ASC 480). The Company also determined that the Milestone Shares meet the scope exception as a derivative under ASC Topic 815, Derivatives and Hedging (ASC 815), from inception of the Milestone Shares through December 31, 2024. Accordingly, the Milestone Shares are evaluated under ASC Topic 450, Contingencies (ASC 450) and the Company will record a liability related to the Milestone Shares if the milestones are achieved, and the obligation to issue the Milestone Shares becomes probable. At such time, the Company will record the cost of the Milestone Shares issued to the Helio founders as a compensation expense and to the other former securityholders of Helio as an in-process research and development expense if there is no alternative future use. No milestones related to the remaining Milestone Shares are considered probable of being achieved as of December 31, 2025 . 4. NET LOSS PER SHARE For the years ended December 31, 2025 and 2024, diluted weighted-average common shares outstanding is equal to basic weighted-average common shares due to the Company’s net loss position. The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted-average shares outstanding, because such securities had an antidilutive impact: Years ended December 31, 2025 2024 Options to purchase common stock 8,582,483 7,621,580 Nonvested restricted stock units 274,496 540,965 Total of common stock equivalents 8,856,979 8,162,545 5. CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES At December 31, 2025, cash, cash equivalents, and marketable securities were comprised of: Carrying Amount Unrecognized Gain Unrecognized Loss Estimated Fair Value Cash and Cash Equivalents Cash $ 29,566,736 $ — $ — $ 29,566,736 $ 29,566,736 Money market funds 40,474,518 — — 40,474,518 40,474,518 Total cash and cash equivalents $ 70,041,254 $ — $ — $ 70,041,254 $ 70,041,254 Total cash, cash equivalents, and current marketable securities $ 70,041,254 There were no marketable securities held at December 31, 2025. 121 At December 31, 2024, cash, cash equivalents, and marketable securities were comprised of: Carrying Amount Unrecognized Gain Estimated Fair Value Cash and Cash Equivalents Current Marketable Securities Cash $ 23,734,013 $ — $ 23,734,013 $ 23,734,013 $ — Money market funds 30,793,079 — 30,793,079 30,793,079 — Total cash and cash equivalents $ 54,527,092 $ — $ 54,527,092 $ 54,527,092 $ — U.S. government agency securities $ 46,586,738 $ 37,442 $ 46,624,180 $ — $ 46,624,180 Available for sale marketable securities (1) 46,586,738 — — 46,624,180 Total cash, cash equivalents, and current marketable securities $ 54,527,092 $ 46,624,180 (1) Available for sale debt securities are reported at fair value with unrealized gains and losses reported net of taxes, if material, in other comprehensive loss. The contractual maturities of all cash equivalents and available for sale securities were less than one year at December 31, 2024 . 6. FAIR VALUE MEASUREMENTS Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value are performed in a manner to maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820, Fair Value Measurements , establishes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value, which are the following: Level 1 – Quoted prices in active markets that are accessible at the market date for identical unrestricted assets or liabilities. Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs for which all significant inputs are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The following table presents information about the Company’s assets measured at fair value at December 31, 2025 and December 31, 2024: December 31, 2025 Level 1 Level 2 Level 3 Total Assets: Money market funds (a) $ 40,474,518 $ — $ — $ 40,474,518 Total assets at fair value $ 40,474,518 $ — $ — $ 40,474,518 122 December 31, 2024 Level 1 Level 2 Level 3 Total Assets: Money market funds (a) $ 30,793,079 $ — $ — $ 30,793,079 U.S. government agency securities (b) 46,624,180 — — 46,624,180 Total assets at fair value $ 77,417,259 $ — $ — $ 77,417,259 (a) Money market funds included in cash and cash equivalents in the consolidated balance sheets, are valued at quoted market prices in active markets . (b) U.S. government agency securities are recorded at fair market value, which are determined based on the most recent observable inputs for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or are directly or indirectly observable. There were no liabilities measured at fair value at December 31, 2025 or December 31, 2024. Financial instruments including clinical trial prepayments to contract research organizations and accounts payable are carried in the consolidated financial statements at amounts that approximate their fair value based on the short maturities of those instruments. The carrying amount of the Company’s term loan under the Hercules Credit Facility (as defined in Note 9) approximates market rates currently available to the Company. 7. PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets at December 31, 2025 and 2024 were: December 31, December 31, 2025 2024 Deferred research and development expenses $ 1,043,086 $ 2,211,963 Prepaid insurance expenses 407,194 408,091 Miscellaneous prepaid expenses and other current assets 291,922 301,152 Total prepaid expenses and other current assets $ 1,742,202 $ 2,921,206 8. ACCRUED EXPENSES Accrued expenses at December 31, 2025 and 2024 were: December 31, December 31, 2025 2024 Accrued compensation $ 4,272,999 $ 4,333,216 Accrued research and development expenses 1,288,423 7,228,922 Accrued other expenses 558,875 556,229 Total accrued expenses $ 6,120,297 $ 12,118,367 9. CREDIT FACILITY The Company’s current and long-term debt obligation consists of amounts the Company is obligated to repay under the credit facility with Hercules Capital, Inc. (Hercules). In March 2019, the Company entered into a Loan and Security Agreement (Loan and Security Agreement or Hercules Credit Facility) with Hercules and several banks and other financial institutions or entities, from time-to-time parties thereto (collectively, referred to herein as Lender), providing for a term loan of up to $ 60.0 million, subject to the satisfaction of certain conditions contained therein, that is secured by a lien covering all of the Company’s assets, other than the Company’s intellectual property. The Loan and Security Agreement provided for (i) an initial term loan advance of up to $ 5.0 million at the Company’s option, which expired unutilized on April 15, 2019; (ii) three additional term loan advances of up to $ 15.0 million each, at the Company’s option, available to the Company upon the occurrence of certain pre-specified funding conditions prior to September 30, 2019 (2019 Tranche), March 31, 2020 (2020 Tranche), and March 31, 123 2021 (2021 Tranche); and (iii) a final additional term loan advance (Fourth Loan Tranche) of up to $ 10.0 million prior to December 31, 2021, at the Company’s option, subject to approval by the Lender’s investment committee. The 2019 Tranche was drawn down in full by the Company in September 2019 and the 2020 Tranche and 2021 Tranche expired unutilized prior to the Company satisfying the funding conditions for such tranche. On April 20, 2021, the Company entered into the First Amendment to the Loan and Security Agreement (First Amendment). The First Amendment, among other things, lowered the variable per annum rate of interest on borrowings under the Loan and Security Agreement from the greater of (a) 9.10 % and (b) the prime rate (as reported in the Wall Street Journal or any successor publication thereto) plus 3.10 % to the greater of (x) the Prime Rate (as defined therein) plus 3.10% or (y) 8.60%. Repayment of the aggregate outstanding principal balance of the term loan, in monthly installments, was to commence upon expiration of the interest-only period and continue through October 1, 2023 (Maturity Date). The First Amendment was determined to be a modification in accordance with ASC Topic 470, Debt (ASC 470), and did not result in an extinguishment. On December 22, 2022, the Company entered into the Second Amendment to the Loan and Security Agreement (Second Amendment), which became effective as of December 31, 2022 (Second Amendment Effective Date). The Second Amendment, among other things, amended the Prepayment Charge (as defined therein) to equal 0.75 % of the amount prepaid during the 12-month period following the Second Amendment Effective Date, and 0 % thereafter. In addition, a supplemental end of term charge of $ 292,500 (Supplemental End of Term Charge) shall be due on the earlier of (a) the Maturity Date, as amended, or (b) repayment of the aggregate amount of advances under the Loan and Security Agreement. On April 29, 2024, the Company entered into the Third Amendment to the Loan and Security Agreement (Third Amendment). The Third Amendment, among other things, extended the expiration of the period in which interest-only payments were to be made on borrowings under the Loan and Security Agreement to October 1, 2024. On May 1, 2024, the Fourth Loan Tranche commitment expired unutilized. The Second and Third Amendments were determined to be modifications in accordance with ASC 470 and did not result in an extinguishment. On September 30, 2024, the Company entered into the Fourth Amendment to the Loan and Security Agreement (Fourth Amendment). The Fourth Amendment, among other things, (i) extended the expiration of the period in which interest-only payments are made on borrowings under the Loan and Security Agreement to April 1, 2026; (ii) extended the Maturity Date from October 1, 2024 to April 1, 2026; and (iii) amended the term loan interest rate to be the greater of (a) the Prime Rate (as defined in the Loan and Security Agreement) plus 3.10%, or (b) 11.10 %. In addition, a supplemental end of term charge of $ 300,000 (Second Supplemental End of Term Charge) shall be due on the earlier of (a) the Maturity Date, as amended, or (b) repayment of the aggregate amount of advances under the Loan and Security Agreement. The Supplemental End of Term Charge of $ 292,500 was paid on October 1, 2024. The Fourth Amendment was determined to be a modification in accordance with ASC Topic 470 and did not result in an extinguishment. On October 28, 2024, the Company entered into the Fifth Amendment to the Loan and Security Agreement (Fifth Amendment). The Fifth Amendment introduces, among other things, new definitions to include holding investments in a wholly owned subsidiary structured as a Massachusetts Security Corporation. In connection with the Hercules Credit Facility, the Company has incurred: a commitment charge of $ 25,000 ; transaction costs of $ 273,186 ; a fee of $ 375,000 upon closing; the End of Term Charge, which was paid in October 2023; and the Supplemental End of Term Charge, which was paid in October 2024. In addition, the Company will be required to pay the Second Supplemental End of Term Charge. The fees and transaction costs are amortized to interest expense from 2019 through the Maturity Date using the effective interest method. Using the effective interest method, the End of Term Charge was amortized to interest expense from 2019 through October 2023, the Supplemental End of Term Charge was amortized to interest expense from December 2022 through October 2024, and the Second Supplemental End of Term Charge is amortized to interest expense from September 2024 through the Maturity Date. The effective interest rate was 12.4 % at December 31, 2025. At the Company’s option, the Company may elect to prepay all, but not less than all, of the outstanding term loan by paying the entire principal balance and all accrued and unpaid interest thereon plus all fees and other amounts due under the Loan and Security Agreement as of the date of such prepayment. As of December 31, 2025 , $ 15 million has been funded under the Loan and Security Agreement and no additional amounts were available to the Company for borrowing. Long-term debt consisted of the following: 124 December 31, December 31, 2025 2024 Term loan payable $ 15,000,000 $ 15,000,000 Supplemental end of term charge 250,000 33,333 Unamortized debt issuance costs ( 368 ) ( 1,961 ) Less: current portion ( 15,249,632 ) ( 31,372 ) Total long-term debt $ — $ 15,000,000 Future principal payments, including the Supplemental End of Term Charge, are as follows for the years ending December 31: Years Ending December 31, 2026 $ 15,300,000 Total $ 15,300,000 The Loan and Security Agreement also contains certain events of default, representations, warranties, and non-financial covenants of the Company. As of December 31, 2025 , the Company was in compliance with all covenants of the Hercules Credit Facility in all material respects. In addition, subject to the terms of the Loan and Security Agreement, the Company granted the Lender the right to purchase up to an aggregate of $ 2.0 million of the Company’s equity securities, or instruments exercisable for or convertible into equity securities, sold to investors in financings, upon the same terms and conditions afforded to such other investors. 10. STOCKHOLDERS’ EQUITY Common Stock Each share of common stock is entitled to one vote. The holders of common stock are also entitled to receive dividends whenever funds are legally available and when declared by the board of directors, subject to the prior rights of holders of all classes of stock outstanding. As of December 31, 2025, a total of 8,582,483 , 2,717,502 , and 3,510,546 , shares of common stock were reserved for issuance upon (i) the exercise of outstanding stock options, (ii) the issuance of stock awards under the Company’s 2023 Equity Plan, and (iii) the issuance of shares under the 2016 ESPP, respectively. 2024 Jefferies Sales Agreement In August 2024, the Company entered into an Open Market Sales Agreement SM with Jefferies LLC (Jefferies), as sales agent (the 2024 Jefferies Sales Agreement), under which the Company has the ability to offer and sell, from time to time through Jefferies, shares of common stock providing for aggregate sales proceeds of up to $ 75.0 million. As of December 31, 2025 , no shares of common stock were sold under the 2024 Jefferies Sales Agreement. 11. INCOME TAXES Income before provision for income taxes was as follows: Years ended December 31, 2025 2024 United States $ ( 33,846,661 ) $ ( 55,851,444 ) Foreign — — Income (loss) before taxes $ ( 33,846,661 ) $ ( 55,851,444 ) No current or deferre d tax provision expense has been recorded for federal income taxes as the Company has incurred losses since inception for tax purposes and maintains a full valuation allowance against net deferred tax assets. During 2025, the Company calculated a $ 30,000 state current tax provision for liability due from the Company's Massachusetts Security Corporation. However, due to immateriality, the tax expense was not recorded. There is no deferred tax provision expense recorded for state income taxes because the Company has a full valuation 125 allowance against net deferred tax assets. Deferred income taxes reflect the net tax 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 components of the income tax provision for the year ended December 31, 2025 and December 31, 2024 is as follows: Years ended December 31, 2025 2024 Deferred Taxes Federal $ — $ — State — 1,000 Total income tax provision $ — $ 1,000 A reconciliation of the provision for income taxes to the amount computed by applying the 21 % statutory U.S. federal income tax rate to income before income taxes after the adoption of ASU 2023-09 is as follows: Year end, December 31, 2025 Rate (%) U.S. Federal Statutory Tax Rate $ ( 7,108 ) ( 21.00 ) % State and Local Income Taxes, Net of Federal Income Tax Effect(a) — — % Tax Credits Research and development tax credits ( 837 ) ( 2.47 ) % Federal Orphan Drug Credits ( 367 ) ( 1.09 ) % Changes in Valuation Allowances 7,252 21.43 % Nontaxable or Nondeductible Items Section 162(m) Limitation 629 1.86 % Stock Compensation 380 1.12 % Other Adjustments 51 0.15 % Effective income tax rate $ — 0.00 % (a) State and local taxes in Massachusetts comprise the entirety of this category. A reconciliation of the provision for income taxes to the amount computed by applying the 21 % statutory U.S. federal income tax rate to income before income taxes for the year prior to the adoption of ASU 2023-09 is as follows: Year ended December 31, 2024 Statutory tax rate 21.00 % State taxes, net of federal benefits 6.65 % Federal research and development credits 4.32 % Change in valuation allowance ( 29.86 ) % Stock-based compensation ( 2.10 ) % Other ( 0.01 ) % Effective tax rate 0.00 % 126 Significant components of the Company’s deferred tax assets and liabilities at December 31, 2025 and 2024 are as follows: Years ended December 31, 2025 2024 Deferred Tax Assets Federal & state NOL carryforward $ 89,129,844 $ 73,738,480 Federal & state R&D credit carryforward 18,192,281 16,803,144 Deferred costs 2,513,728 1,139,165 Intangibles – net 78,378 78,378 Accounts payable and accrued expenses 2,885,142 4,203,111 Stock options 3,627,963 3,575,996 Capitalized R&D expenses 14,440,266 21,929,898 Other items 98,731 99,098 Gross deferred tax assets 130,966,333 121,567,270 Valuation allowance ( 130,890,968 ) ( 121,486,475 ) Deferred tax assets, net 75,365 80,795 Deferred Tax Liabilities Right-of-use asset ( 75,365 ) ( 72,932 ) Unrealized gain — ( 7,863 ) TOTAL $ — $ — The change in valuation allowance of $ 9.4 million from December 31, 2024 to December 31, 2025 was primarily the result of the pre-tax book loss and the current year generated tax credits partially offset by expensing of previously capitalized domestic research and development costs due to the OBBB Act. In assessing the realizability of net deferred taxes in accordance with ASC 740, Income Taxes , the Company considers whether some portion or all the deferred tax assets are more likely than not to be unrealized. Based on the weight of available evidence, primarily the incurrence of net losses since inception, anticipated net losses in the near future, reversals of existing temporary differences, and expiration of various federal and state attributes, the Company does not consider some or all net deferred taxes more likely than not to be realized. Accordingly, a 100 % valuation allowance has been applied against net deferred tax assets. As of December 31, 2025, the Company had federal and state income tax net operating loss (NOL) carryforwards of approximately $ 327.9 million and $ 320.8 million, respectively. Federal NOL carryforwards generated through December 31, 2017 and state NOL carryforwards generated through December 31, 2025 will expire at various dates through 2045 . The federal NOL carryforwards generated during the year ended December 31, 2018 and thereafter will carryforward indefinitely. As of December 31, 2025, the Company had federal and state research and development tax credit carryforwards of approximately $ 13.0 million and $ 3.1 million, respectively, which will expire at various dates through 2045 . Additionally, as of December 31, 2025, the Company had a federal orphan drug tax credit carryforward of approximately $ 2.8 million which expire at various dates through 2045 . Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, a corporation that undergoes an “ownership change” is subject to limitations on its ability to utilize its pre-change NOLs and certain other tax assets to offset future taxable income or tax due. In general, an ownership change occurs if the aggregate stock ownership of certain stockholders increases by more than 50 percentage points over such stockholders’ lowest percentage ownership during the testing period (generally three years). Transactions involving the Company’s common stock within the testing period, even those outside the Company’s control such as purchases or sales by investors, could result in an ownership change. A limitation on the Company’s ability to utilize some or all its NOLs or credits could have a material adverse effect on the Company’s results of operations and cash flows. The Company believes, prior to December 31, 2021 that four ownership changes occurred since inception. Management believes that its aggregate Section 382 and 383 limitation (including the additional limitation for recognized "built-in gains") is sufficient so that no current impairment of its pre-ownership change tax attributes is required. Management believes there were no ownership changes from December 31, 2021 through December 31, 2025, based on a review of the Company's equity history during that period. Any future ownership changes, including those resulting from any recent or future financing activities, may cause our existing tax attributes to have additional limitations. 127 Future changes in federal and state tax laws pertaining to net operating loss carryforwards may also impose limitations or restrictions on claiming such net operating losses. If the net operating loss carryforwards become unavailable to the Company or are fully utilized, the Company's future taxable income will not be shielded from federal and state income taxation, absent certain U.S. federal and state tax credits, and the funds otherwise available for general corporate purposes would be reduced. As of December 31, 2025, the Company is subject to tax in the U.S. (Federal and Massachusetts). The Company is open to examination for the tax years ended December 31, 2025, 2024, 2023, 2022, and 2021. In addition, any years remain open to the extent that losses or tax credits are available for carryover to future years. It is the Company’s policy to include penalties and interest expense related to income taxes as a component of the provision for income taxes. As of December 31, 2025 and 2024, the Company had no accrued interest or penalties related to uncertain tax positions and no amounts have been recognized in the Company’s statements of operations. For the year ended December 31, 2025, the Company generated research and development tax credits as well as an Orphan Drug Credit but has not conducted a study to document the qualified activities. This study may result in an adjustment to the Company’s research and development tax credit carryforwards; however, until a study is completed and any adjustment is known, no amounts are being presented as an uncertain tax position. A full valuation allowance has been provided against the Company’s research and development tax credit carryforwards and, if an adjustment is required, this adjustment would result in an adjustment to the deferred tax asset established for the research and development tax credit carryforwards and the valuation allowance. 12. STOCK INCENTIVE PLAN The Company approved the 2013 Equity Incentive Plan in October 2013, which was amended in June 2016 and June 2018 (the Amended 2013 Plan). The Amended 2013 Plan provided for the granting of stock options, restricted stock units (RSU), stock appreciation rights, and stock units to certain employees, members of the board of directors and consultants of the Company. In May 2023, the Company's board of directors approved the 2023 Equity Incentive Plan (the 2023 Equity Plan) to replace the Amended 2013 Plan. On June 30, 2023, the Company's stockholders approved the 2023 Equity Plan at the Company's 2023 annual meeting of stockholders. Pursuant to the 2023 Equity Plan, the Company will not make any further grants under the Amended 2013 Plan following June 30, 2023, though awards previously granted under the Amended 2013 Plan will remain outstanding. The 2023 Equity Plan is effective for a period of ten years after June 30, 2023, and a total of 5,450,000 shares of the Company’s common stock, in addition to shares of the Company’s common stock that are subject to awards granted under the Amended 2013 Plan that are outstanding as of such date and that are subsequently forfeited, cancelled, or expire before being exercised or settled in full, are authorized for issuance under the 2023 Equity Plan. As of December 31, 2025, options to purchase 3,795,077 shares of common stock at a weighted average exercise price of $ 4.45 per share remained outstanding under the 2023 Equity Plan and options to purchase 4,787,406 shares of common stock at a weighted average exercise price of $ 6.33 per share remained outstanding under the 2013 Equity Plan. As of December 31, 2025, there were 2,717,502 shares of common stock available for grant under the 2023 Equity Plan. In 2022, the Company granted cash awards under the Management Cash Incentive Plan, as amended (the Management Cash Incentive Plan). The Management Cash Incentive Plan, which was adopted in 2016, provides participants with the opportunity to earn cash incentive awards for the achievement of goals relating to the performance of the Company. The cash awards, which are equal in value to the amount by which the then value of the Company’s common stock on the Nasdaq Capital Market (Nasdaq) exceeds the base values, vest in four annual installments from the date of grant based on continued service and entitle employees to receive a cash payment on the earlier of (i) four years from the date of grant, or (ii) a change of control . As of December 31, 2025 , $ 0.3 million was accrued as compensation expense for vested cash awards. In 2022, the Company granted performance cash settled bonus awards (CSBUs) under the Management Cash Incentive Plan. As the performance criteria had been met, the awards, which are equal in value to the closing price per share of the Company's common stock on Nasdaq on the payment date, will vest in four annual installments from the date of grant based on continued service, and entitle employees to receive cash payments for each vested CSBU, on the earlier of (i) four years from the date of grant or (ii) a change of control. As of December 31, 2025 , $ 3.0 million was accrued as compensation expense for CSBUs as the Performance Criteria was met in February 2023. 128 The Company recognizes stock-based compensation expense over the requisite service period. The Company’s share-based awards are accounted for as equity instruments, except for cash awards and CSBUs, which are accounted for as liabilities. The amounts included in the consolidated statements of operations relating to stock-based compensation associated with the two equity incentive plans, cash awards , and CSBUs are as follows: Years ended December 31, 2025 2024 Research and development expenses $ 3,443,700 $ 4,470,890 General and administrative expenses 2,647,713 3,502,609 Total stock-based compensation expense $ 6,091,413 $ 7,973,499 Stock Options Terms of stock option agreements, including vesting requirements, are determined by the board of directors or its compensation committee, subject to the provisions of the respective plan from which they were granted. Options granted by the Company typically vest over a four-year period. The options are subject to acceleration of vesting in the event of certain change of control transactions. The options may be granted for a term of up to ten years from the date of grant. The exercise price for options granted under the Amended 2013 Plan and the 2023 Equity Plan must be at a price no less than 100 % of the fair market value of a common share on the date of grant. The table below summarizes activity relating to stock options under the incentive plans for the year ended December 31, 2025: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value(a) Outstanding at December 31, 2024 7,621,580 $ 5.64 6.34 $ 4,885,683 Granted 1,608,606 $ 5.06 $ — Forfeited ( 124,723 ) $ 4.96 $ 3,879 Exercised ( 274,158 ) $ 4.03 $ 443,734 Expired ( 248,822 ) $ 8.99 $ — Outstanding at December 31, 2025 8,582,483 $ 5.50 6.18 $ 6,607,251 Exercisable at December 31, 2025 6,125,955 $ 5.89 5.16 $ 3,875,855 (a) The aggregate intrinsic value in this table was calculated on the positive difference, if any, between the closing price per share of the Company’s common stock on December 31, 2025 of $ 5.18 and the per share exercise price of the underlying options. The total intrinsic value of stock options exercised was $ 0.4 million and $ 0.1 million for the years ended December 31, 2025 and 2024 , respectively. The Company records stock-based compensation related to stock options granted at fair value. During the years ended December 31, 2025 and 2024, the Company used the Black-Scholes option-pricing model to estimate the fair value of stock option grants and to determine the related compensation expense. The assumptions used in calculating the fair value of stock-based payment awards represent management’s best estimates. The weighted-average grant date fair value of options granted was $ 3.87 and $ 2.81 for the years ended December 31, 2025 and 2024 , respectively. The assumptions used in determining fair value of the employee stock options for the years ended December 31, 2025 and 2024, are as follows: December 31, 2025 December 31, 2024 Expected dividend yield 0 % 0 % Anticipated volatility 89.71 % - 98.47 % 90.56 % - 90.94 % Stock price $ 2.19 - $ 6.17 $ 3.62 - $ 4.09 Exercise price $ 2.19 - $ 6.17 $ 3.62 - $ 4.09 Expected life (years) 5.50 - 6.08 5.50 - 6.02 Risk free interest rate 3.81 % - 4.13 % 4.07 % - 4.35 % 129 The dividend yield of zero is based on the fact that the Company has never paid cash dividends and have no present intention to pay cash dividends. Expected volatility is estimated using the historical volatility of the Company. The Company has estimated the expected life of its employee stock options using the “simplified” method, whereby, the expected life equals the average of the vesting term and the original contractual term of the option for service-based awards since the Company does not have sufficient historical or implied data of its own. The risk-free interest rates for periods within the expected life of the option are based on the yields of zero-coupon United States Treasury securities. At December 31, 2025, there is approximately $ 7.6 million of unrecognized compensation cost relating to stock options outstanding, which the Company expects to recognize over a weighted average period of 2.35 years. Total unrecognized compensation cost will be adjusted for future forfeitures, if necessary. Restricted Stock Units Terms of RSUs agreements, including vesting requirements, are determined by the board of directors or its compensation committee, subject to the provisions of the Amended 2013 Plan and the 2023 Equity Plan. RSUs granted by the Company typically vest over a four year period and are based on the stock share price on the date of grant to estimated fair value. In the event that the employees’ employment with the Company terminates any unvested shares are forfeited and revert to the Company. RSUs are not included in issued and outstanding common stock until the shares are vested and released. The table below summarizes activity relating to RSUs for the year ended December 31, 2025: Number of Shares Weighted-Average Grant Date Fair Value Outstanding at December 31, 2024 540,965 $ 5.49 Forfeited ( 33,233 ) $ 4.72 Vested / Settled ( 233,236 ) $ 5.52 Outstanding at December 31, 2025 274,496 $ 5.55 There were no RSUs granted during the years ended December 31, 2025 and 2024. The total fair value of RSUs vested was $ 1.3 million and $ 1.7 million for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, the outstanding RSUs had unamortized stock-based compensation expense of $ 0.6 million with a weighted-average remaining recognition period of 0.85 years and an aggregate intrinsic value of $ 1.2 million. Employee Stock Purchase Plan In March 2016, the Company’s board of directors approved the 2016 Employee Stock Purchase Plan (2016 ESPP), which became effective in June 2016 following the approval of the Company’s stockholders. The 2016 ESPP initially authorized the issuance of up to a total of 414,639 shares of the Company’s common stock to participating employees. The number of shares reserved for issuance under the 2016 ESPP automatically increases on the first business day of each fiscal year, commencing in 2017, by a number equal to the lower of (i) 1 % of the shares of common stock outstanding on the last business day of the prior fiscal year; or (ii) the number of shares determined by the Company’s board of directors. Unless otherwise determined by the administrator of the 2016 ESPP, two offering periods of six months’ duration will begin each year on January 1 and July 1. Participating employees purchase stock under the 2016 ESPP at a price equal to the lower of 85 % of the closing price on the applicable offering commencement date or 85 % of the closing price on the applicable offering termination date. 130 The fair value of the purchase rights granted under the 2016 ESPP plan was estimated on the date of grant using the Black-Scholes option-pricing model using assumptions as shown below: December 31, 2025 December 31, 2024 Expected dividend yield 0 % 0 % Anticipated volatility 89.64 % - 97.56 % 90.36 - 90.37 % Stock price $ 3.93 - $ 5.22 $ 3.25 - $ 3.54 Exercise price $ 3.34 - $ 4.44 $ 2.76 - $ 3.01 Expected life (years) 5.50 - 6.02 0.50 Risk free interest rate 4.25 % - 4.29 % 5.24 % - 5.37 % At December 31, 2025, the Company has 3,510,546 shares available for issuance under the 2016 ESPP. The number of shares available for issuance under the 2016 ESPP was increased as of January 2, 2026 by 601,628 shares. A summary of the weighted-average grant-date fair value, shares issued and total stock-based compensation expense recognized related to the 2016 ESPP for the years ended December 31, 2025 and 2024 are as follows: December 31, 2025 December 31, 2024 Weighted-average grant-date fair value per share $ — $ 1.38 Total shares issued — $ 13,159 Total stock-based compensation expense $ — $ 18,894 13. COMMITMENTS AND CONTINGENCIES Guarantees and Indemnifications As permitted under Delaware law, the Company indemnifies its officers and directors for certain events or occurrences while the officer or director is, or was, serving at the Company’s request in such capacity. The term of the indemnification is for the officer’s or director’s lifetime. Through December 31, 2025 , the Company had not experienced any losses related to these indemnification obligations and no material claims were outstanding. The Company currently does not expect significant claims related to these indemnification obligations, consequently concluded that the fair value of these obligations is negligible, and no related reserves were established. In-License Agreements MEEI Agreement The Company was developing ADX‑2191 for the treatment of proliferative vitreoretinopathy pursuant to an Exclusive License Agreement with Massachusetts Eye and Ear Infirmary (MEEI), originally entered into in July 2016 between MEEI and Helio Vision, Inc., as amended, (the MEEI Agreement). The Company assumed the MEEI Agreement in connection with the 2019 acquisition of Helio Vision. Pursuant to the MEEI Agreement, the Company obtained an exclusive worldwide license from MEEI to develop and commercialize ADX‑2191 under certain patents and patent applications, in addition to other licenses to intellectual property (the MEEI Patent Rights). The Company has agreed to use commercially reasonable efforts to develop ADX‑2191, and to meet certain specified effort and achievement benchmarks by certain dates. 131 In consideration for the rights licensed under the MEEI Agreement, Helio Vision issued MEEI a number of shares of preferred stock and Helio Vision agreed, during the term of the agreement, to pay non-creditable non-refundable license maintenance fees to MEEI of $ 15,000 on each of the second and third anniversary of the agreement, $ 25,000 on each of the fourth and fifth anniversary of the agreement, and $ 35,000 on the sixth and each subsequent anniversary of the agreement. In addition, Helio Vision was obligated to make future sales-dependent milestone payments to MEEI of up to low seven figures in the aggregate, as well as royalty payments to MEEI at a rate which, as a percentage of net sales, is in the low single digits for products that incorporate or use the MEEI Patent Rights. Helio is also obligated under the MEEI Agreement to pay MEEI a percentage of certain sublicense revenue at a percentage rate that descends from low-double digits to mid-single digits based on the date of the sublicense. Following the Company’s acquisition of Helio Vision, the Company became obligated to make any future payments previously owed by Helio under the MEEI Agreement. There is no additional equity consideration issuable under the MEEI Agreement. The MEEI Agreement will remain in effect until the expiration date of the last to expire patent licensed under the MEEI Agreement. The Company may terminate the MEEI Agreement with timely written notice to MEEI. MEEI has the right to terminate the MEEI Agreement, subject to certain specified cure periods, in the event of the Company’s insolvency or bankruptcy or if the Company ceases all business operations with respect to licensed products; the Company fails to pay amounts due under the MEEI Agreement; the Company fails to comply with certain due diligence obligations; the Company does not maintain specific levels of insurance; one of the Company's officers is convicted of a felony relating to the manufacture, use, sale or importation of licensed products; or the Company materially breaches any provisions of the MEEI Agreement or in the event of insolvency or bankruptcy. In the event of an early termination of the MEEI Agreement, all rights licensed and developed by the Company under the MEEI Agreement will revert to MEEI. The Company has agreed to indemnify MEEI for certain claims that may arise under the MEEI Agreement. Other In-License Agreements Additionally, the Company has other in-license agreements with third parties that require the Company to make future development, regulatory and commercial milestone payments, as well as royalty payments on net sales of specified products, if and when such milestones are achieved or sales occur. As of December 31, 2025, none of the related milestones had been achieved and no royalties were due. The amount and timing of any future payments are uncertain and depend on the successful development and commercialization of the related products. Legal Proceedings From time to time, the Company may become subject to litigation and claims arising in the ordinary course of business. The Company is not currently a party to any material legal proceedings that we expect to have any material adverse effect on our business, financial con dition or results of operation. 14. LEASES The Company currently leases office space to conduct business operations. Lease renewal options are regularly evaluated, and when the exercise of an option is reasonably certain, the Company includes the renewal period in the lease term. The lease does not specify an implicit rate. Based on information available at the lease commencement date, the Company uses the incremental borrowing rate to determine the present value of lease payments. In November 2023, the Company entered into a lease amendment extending the lease by 12 months, through December 31, 2024. The amendment also included two additional 12-month extension options. Each option was exercised by providing written notice to the landlord at least nine months in advance. In April 2024, the Company exercised the first extension option, extending the lease through December 2025. The extension was reflected in the financial statements as of December 31, 2023. In April 2025, the Company exercised the second extension option, further extending the lease through December 2026. The extension is reflected on the balance sheet as of March 31, 2025, the date the exercise of the option was reasonably certain, through the remeasurement of the related lease liability and a corresponding adjustment to the right-of-use asset. For the years ended December 31, 2025 and 2024 , right-of-use assets obtained in exchange for lease obligations were $ 0.3 million and $ 0.3 million, respectively. 132 As of December 31, 2025 , the Company maintained an unamortized right-of-use asset with a corresponding operating lease liability of approximately $ 0.3 million based on the present value of the minimum rental payments in accordance with ASC 842, Leases . The weighted average discount rate used for leases as of December 31, 2025 is 9.1 %. The weighted average lease term as of December 31, 2025 is 1.0 year. The operating lease expense for the year ended December 31, 2025 was $ 0.3 million . Maturities and balance sheet presentation of our lease liabilities for all operating leases as of December 31, 2025 is as follows: Remaining total lease payments $ 294,557 Less: effect of discounting ( 14,020 ) Present value of lease liabilities $ 280,537 Current operating lease liabilities $ 280,537 Non-current operating lease liabilities — Total $ 280,537 The Company’s gross future minimum payments under all non-cancellable operating leases as of December 31, 2025 are: Total 2026 2027 2028 2029 Operating Lease Obligations $ 294,557 $ 294,557 $ — $ — $ — 15. OPTION AGREEMENT AbbVie Option Agreement On October 31, 2023 (the AbbVie Option Agreement Effective Date), the Company entered into an exclusive option agreement (the AbbVie Option Agreement) with AbbVie Inc. (AbbVie), pursuant to which the Company granted AbbVie an exclusive option (the AbbVie Option) to obtain (a) a co-exclusive license in the United States to facilitate a collaboration with the Company to develop, manufacture, and commercialize reproxalap in the United States, (b) an exclusive license to develop, manufacture, and commercialize reproxalap outside the United States, (c) a right of first negotiation for compounds that are owned or otherwise controlled by the Company in the field of ophthalmology relating to treating conditions of the ocular surface, and (d) a right to review data for any other compounds that are owned or otherwise controlled by the Company in the fields of ophthalmology and immunology before such data is shared with any other third party (the Collaboration Agreement). AbbVie paid the Company a non-refundable payment of $ 1.0 million in consideration of the AbbVie Option (the AbbVie Option Payment). On December 21, 2023, pursuant to the AbbVie Option Agreement, AbbVie extended the period during which it may exercise the AbbVie Option (the Exercise Period Extension) by paying the Company a non-refundable payment of $ 5.0 million (the AbbVie Option Extension Fee). If the Collaboration Agreement is entered into, the AbbVie Option Payment and the AbbVie Option Extension Fee will be credited against the upfront cash payment payable by AbbVie. On November 15, 2024, the Company entered into the Expansion Side Letter (the Expansion Letter) with AbbVie. The Expansion Letter makes certain changes to the AbbVie Option Agreement, among other things, providing that the Company will conduct certain launch activities, which costs shall not exceed mid-single-digit millions of dollars without AbbVie’s approval, and which costs will be considered allowable expenses pursuant to the Collaboration Agreement upon the delivery of AbbVie’s written notice of exercising the AbbVie Option and entry into the Collaboration Agreement, such that 60 % of the Company's allowable expenses will be reimbursed by AbbVie in the event of exercise. If AbbVie does not deliver a written notice of exercising the AbbVie Option and the Company and AbbVie do not execute the Collaboration Agreement, the Company will remain solely responsible for such costs. AbbVie has also independently initiated pre-commercialization planning activities. In addition, the Exercise Period (as defined in the AbbVie Option Agreement) was restricted to ten (10) business days following approval from the U.S. Food and Drug Administration of the NDA for reproxalap in dry eye disease (the FDA Decision), provided that AbbVie shall provide the Company notice in case AbbVie determines that it will not exercise the AbbVie Option. The Company did not conduct any launch activities or incur related expenses during fiscal years ended December 31, 2025 and December 31, 2024. 133 Upon AbbVie’s delivery of the agreement execution notice and the parties entering into the Collaboration Agreement, AbbVie would pay the Company a $ 100.0 million upfront cash payment, less the AbbVie Option Payment and the AbbVie Option Extension Fee. In addition, the Company would be eligible to receive up to approximately $ 300.0 million in regulatory and commercial milestone payments, inclusive of a $ 100.0 million milestone payment payable if the FDA Decision is received prior to or after the execution. In the United States, the Company would share profits and losses with AbbVie from the commercialization of reproxalap according to a split of 60 % for AbbVie and 40 % for the Company. Outside of the United States, the Company would be eligible to receive tiered royalties on net sales of reproxalap. As of February 27, 2026, AbbVie has not exercised the AbbVie Option. As of December 31, 2023, the Company recognized no collaboration revenue and recorded $ 6.0 million of deferred long-term collaboration revenue related to the AbbVie Option Agreement and Exercise Period Extension. During the years ended December 31, 2025 and December 31, 2024 , the deferred collaboration revenue was classified as a current liability due to the AbbVie Option expiring pursuant to the terms of the AbbVie Option Agreement in less than one year. Although the AbbVie Option Agreement was not considered to be a vendor-customer relationship, the Company used ASC 606 to conclude that the $ 6.0 million liability would be considered the transaction price (the Transaction Price) and all other amounts due to the Company under the Collaboration Agreement would be excluded from the Transaction Price, since such amounts relate to fees that can only be achieved subsequent to the exercise of the AbbVie Option. Because the AbbVie Option Extension Fee and the AbbVie Option Payment are creditable against the Collaboration Agreement payments due to the Company, the Transaction Price was allocated to a single unit of account and was considered the option to enter into a future collaboration agreement which is considered a material right. The Company concluded that all other performance obligations were immaterial promises in the context of the AbbVie Option Agreement and did not represent additional units of account. The Company will begin to recognize revenue if and when the AbbVie Option is exercised or when the AbbVie Option expires. 16. SEGMENT REPORTING The Company operates through a single operating and reportable segment focused on the discovery and development of innovative therapies designed to treat immune-mediated diseases. The segment's approach is to develop pharmaceuticals that modulate protein systems, instead of directly inhibiting or activating single protein targets, with the goal of optimizing multiple pathways at once while minimizing toxicity. The Company's product candidates include RASP (reactive aldehyde species) modulators, ADX‑248, ADX‑246, and chemically related molecules for the potential treatment of systemic and retinal immune-mediated diseases. The Company's late-stage product candidates are reproxalap, a RASP modulator for the potential treatment of dry eye disease and allergic conjunctivitis, and ADX‑2191, a novel formulation of intravitreal methotrexate for the potential treatment of primary vitreoretinal lymphoma and retinitis pigmentosa. The Company's tangible assets are held in the United States. The Company manages all business activities on a consolidated basis. The Company's Chief Operating Decision Maker (CODM) is the Chief Executive Officer. The accounting policies of the operating segment are the same as those described in Note 2, Summary of Significant Accounting Policies. The CODM evaluates the performance of the operating segment and allocates resources based on net income (loss) that also is reported on the consolidated income statement as net loss. The measure of the operating segment assets is reported on the consolidated balance sheet as total assets. The CODM uses net income (loss) to monitor budget versus actual results and to analyze cash flows in assessing performance of the segment and allocating resources. The significant expenses are presented on the Company’s Consolidated Statements of Operations. 134