What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-03-26 compared with 2025-03-20 · 196 added, 141 removed, 448 unchanged (43% of the section changed)

12 unchanged sentences

We have audited the accompanying consolidated balance sheets of Cognition Therapeutics, Inc.

and subsidiary (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive loss, stockholders’ equity and cash flows for each of two years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”).

(the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, stockholders’ equity and cash flows for each of two years in the period ended December 31, 2025, 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 two years in the period ended December 31, 2025, in conformity with U.S.

generally accepted accounting principles.

The Company's Ability to Continue as a Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.

As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and has stated that substantial doubt exists about the Company’s ability to continue as a going concern.

Management's evaluation of the events and conditions and management’s plans regarding these matters are also described in Note 1.

The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

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Prepaid expenses and other current assets

Restricted cash equivalents

Total current assets

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Accumulated deficit

Accumulated other comprehensive loss

Total stockholders’ equity

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Balances as of December 31, 2023

Issuance of common stock under the at-the-market (ATM) sales agreement, net of commissions and allocated fees

Issuance of common stock as commitment shares for equity line financing (Note 8)

Issuance of common stock related to the equity line financing

Issuance of common stock in follow on public offering, net of discounts and issuance costs of $ 1,329

Issuance of common stock under the 2022 ATM, net of commissions and allocated fees

Issuance of common stock upon vesting of RSUs, net of shares withheld for employee taxes

Exercise of common stock options

Equity-based compensation

Other comprehensive gain

Reclassification adjustment of foreign currency translation included in net loss for liquidation of subsidiary

Balances as of December 31, 2024

Issuance of common stock in follow on public offering, net of discounts and issuance costs of $ 1,329

Issuance of common stock and warrants in registered direct offering, net of discounts and issuance costs of $ 2,245

Issuance of common stock under the at-the-market sales agreement, net of commissions and allocated fees

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Equity-based compensation

Reclassification adjustment of foreign currency translation included in net loss for liquidation of subsidiary

Balances as of December 31, 2025

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Loss on currency translation from liquidation of subsidiary

Issuance of common stock as commitment shares for equity line financing

Realized loss on sale of property and equipment

Changes in operating assets and liabilities:

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Payments for property and equipment

Net cash used in investing activities

Proceeds from sale of property and equipment

Net cash provided by (used in) investing activities

Cash flows from financing activities:

Proceeds from issuance of common stock in follow-on public offering, net

Proceeds from issuance of common stock under the ATM sales agreement, net

Proceeds from issuance of common stock in registered offering, net

Proceeds from issuance of common stock under the 2022 ATM, net of commissions and allocated fees

Proceeds from the exercise of common stock options

Proceeds from sale of common stock related to the equity line financing

Payment of employee withholding taxes on vested restricted stock units

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Net cash provided by financing activities

Effect of exchange rate changes on cash and cash equivalents

Net decrease in cash and cash equivalents

Cash and cash equivalents

Cash and cash equivalents – beginning of period

Cash and cash equivalents – end of period

Net increase (decrease) in cash, cash equivalents, and restricted cash equivalents

Cash, cash equivalents, and restricted cash equivalents

Cash, cash equivalents, and restricted cash equivalents – beginning of period

Cash, cash equivalents, and restricted cash equivalents – end of period

Supplemental disclosures of non-cash financing activities:

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The Company was founded on the unique combination of biological expertise around these targets, including proprietary assays that emphasize functional responses, and proprietary medicinal chemistry intended to produce novel, high-quality small-molecule drug candidates.

In January 2024, the Company ceased operations at Cognition Therapeutics PTY LTD, a wholly owned subsidiary (the “Subsidiary”) and completed its liquidation of the Subsidiary (the “Liquidation”).

In accordance with the Liquidation, the Company removed the Accumulated Other Comprehensive Income (AOCI) balance associated with the currency translation adjustments and recorded a loss on liquidation of the Subsidiary in accumulated deficit.

On December 23, 2022, the Company filed a Registration Statement on Form S-3 (File No.

1 unchanged sentence

The Shelf was declared effective on January 3, 2023 by the SEC.

The Company also simultaneously entered into a sales agreement with Cantor Fitzgerald & Co.

The Company also simultaneously entered into a sales agreement (the “Previous Sales Agreement”) with Cantor Fitzgerald & Co.

Riley Securities, Inc.

(the “Sales Agents”) providing for the offering, issuance and sale by the Company of up to $ 40,000 of its common stock from time to time in “at-the-market” offerings under the Shelf (the “ATM”).

During the year ended December 31, 2024, the Company sold 19,913,189 shares of its common stock pursuant to the ATM for net proceeds of approximately $ 12,454 .

Please refer to Note 8 for further details.

Riley”) providing for the offering, issuance and sale by the Company of up to $ 40,000 of its common stock from time to time in “at-the-market” offerings under the Shelf (the “2022 ATM”).

On December 16, 2025, the Company delivered written notice to B.

Riley to terminate the Previous Sales Agreement, effective December 18, 2025.

The Company is not subject to any termination penalties related to the termination of the Previous Sales Agreement.

Prior to termination, approximately $ 12,465 remained in gross proceeds available for future issuances of common stock under the 2022 ATM.

Refer to Note 8 – Stockholders’ Equity for further details.

On March 10, 2023, the Company entered into a purchase agreement with Lincoln Park Capital Fund, LLC (“Lincoln Park”) for an equity line financing (the “Purchase Agreement”).

The Purchase Agreement provides that, subject to the terms and conditions set forth therein, the Company has the right, but not the obligation, to direct Lincoln Park to purchase up to $ 35,000 of shares of common stock in the Company’s sole discretion, over a 36-month period commencing on March 10, 2023.

The Company filed a prospectus supplement to its Registration Statement on Form S-3 (File No.

333-268992) covering the resale of shares of common stock that may be issued under the Purchase Agreement.

As part of the Purchase Agreement, the Company issued 189,856 shares of its common stock as consideration for Lincoln Park’s commitment to purchase shares of common stock under the Purchase Agreement.

During the year ended December 31, 2025, the Company did not sell any shares of common stock to Lincoln Park.

As of December 31, 2025, $ 34,795 was available to draw pursuant to the Purchase Agreement.

Please refer to Note 8 for further details.

On March 14, 2024, the Company closed a follow-on public offering of 6,571,428 shares of the Company’s common stock at a public offering price of $ 1.75 per share (“March 2024 Offering”).

As part of the March 2024 Offering, the underwriters exercised their option to purchase 985,714 shares of the Company’s common stock on March 28, 2024, at a public offering price of $ 1.75 per share.

The gross proceeds from the March 2024 Offering were $ 13,225 and the net proceeds were approximately $ 11,896 , after deducting underwriting discounts and commissions and other offering related expenses payable by the Company.

Liquidity and Going Concern

The Company’s Consolidated Financial Statements have been prepared on a going concern basis, which contemplates the continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business.

Refer to Note 8 – Stockholders’ Equity for further details.

In August 2025, the Company entered into Securities Purchase Agreements with two institutional investors relating to the issuance of an aggregate of 14,700,000 shares of the Company’s common stock to such investors at a purchase price of $ 2.05 per share in a registered direct offering (the “Registered Direct Offering”).

The Company also entered into a Placement Agency Agreement on such date (the “Purchase Agency Agreement”) with Titan Partners Group LLC, a division of American Capital Partners, LLC, (“Titan”) acting as the sole placement agent for the Registered Direct Offering.

The Company closed this offering on August 29, 2025.

The Company received net proceeds of approximately $ 27,890 , after deducting $ 2,245 of unwriting discounts, commissions, placement agent fees, and other offering related expenses payable by the Company.

Refer to Note 8 – Stockholders’ Equity.

On December 18, 2025, the Company filed a shelf registration statement with the SEC and a prospectus supplement, which registered the offering, issuance and sale of up to $ 300,000 of various equity and debt securities and up to $ 75,000 of common stock pursuant to an at-the-market equity offering program with Jefferies LLC (“Jefferies”) (the “2025 ATM”).

For the period ended December 31, 2025, the Company did no t sell any shares of common stock pursuant to the 2025 ATM.

As of December 31, 2025, $ 75,000 remain in gross proceeds available for future issuances of common stock under the 2025 ATM.

Refer to Note 8 – Stockholders’ Equity.

The Company has incurred recurring losses since inception, including net losses of $ 23,487 for the year ended December 31, 2025 and $ 33,971 for the year ended December 31, 2024.

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The Company expects to continue to incur losses for the foreseeable future.

As of March 20, 2025, the date of issuance of these Consolidated Financial Statements, the Company believes that its cash and cash equivalents as of December 31, 2024, is not sufficient to fund operations for the period through one year after the date of this filing and therefore substantial doubt exists about the Company’s ability to continue as a going concern.

To execute its business plans, the Company will need substantial funding to support its continuing operations and pursue its growth strategy.

Until such time that the Company can generate significant revenue from product sales, if ever, the Company expects to finance its operations through the sale of common stock in public offerings and/or private placements, debt financings or other capital sources, including collaborations with other companies or other strategic transactions.

The terms of any financing may adversely affect the holdings or the rights of the Company’s stockholders.

As of March 26, 2026, the date of issuance of these consolidated financial statements, the Company believes that its cash and cash equivalents as of December 31, 2025, is sufficient to fund operations for the period through one year after the date of this filing as a result of net proceeds from equity transactions.

To execute its business plans, the Company will need substantial additional funding to support its continuing operations and pursue its growth strategy.

Until such time that the Company can generate significant revenue from product sales, if ever, the Company expects to finance its operations through the sale of common stock in public offerings and/or private placements, debt financing or other capital sources, including collaborations with other companies or other strategic transactions.

The terms of any financing may adversely affect the holdings or the rights of the Company’s stakeholders.

If the Company is unable to obtain funding, the Company could be forced to delay, reduce or abandon its product development programs, which could have a material adverse effect on its business prospects.

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Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S.

(“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of the expenses during the reporting periods.

Significant estimates and assumptions reflected in these consolidated financial statements include but are not limited to the valuation of stock-based awards and the valuation allowance of deferred tax assets.

In addition, management’s assessment of the Company’s ability to continue as a going concern involves the estimation of the amount and timing of future cash inflows and outflows.

Changes in estimates are recorded in the period in which they become known.

The preparation of consolidated financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents consist primarily of interest-bearing deposits at various financial institutions and money markets.

Cash, Cash Equivalents, and Restricted Cash Equivalents

Cash, cash equivalents, and restricted cash equivalents consist primarily of interest-bearing deposits at various financial institutions and money markets.

The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash equivalents reported on the consolidated balance sheet which, in aggregate, represents the amount reported in the consolidated cash flows for the years ended December 31, 2025 and 2024:

As of December 31,

Cash and cash equivalents

Restricted cash equivalents

Grant Receivables

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The Company expects all receivables to be collectible, and accordingly, there is no allowance for doubtful accounts required on these grant receivables.

The Company generates grant income through grants from government and other (non-government) organizations.

The Company generates grant income through grants and donations from government and other (non-government) parties.

Grant income is recognized in other income (expense) in the period in which the reimbursable research and development services are incurred and the right to payment is realized.

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Research and Development Costs

The Company is involved in research and development of treatments for a variety of diseases related to the central nervous system, with a focus on Alzheimer’s disease, dementia with Lewy bodies, and geographic atrophy (GA) secondary to dry age-related macular degeneration.

The Company is involved in research and development of treatments for a variety of diseases related to the central nervous system, with a focus on Alzheimer’s disease, dementia with Lewy bodies (“DLB”), and geographic atrophy (“GA”) secondary to dry age-related macular degeneration.

Research and development costs are expensed as incurred.

Research and development expenses consist principally of personnel costs, including salaries, stock-based compensation, and benefits for employees, third-party license fees and other operational costs related to our research and development activities, including allocated facility-related expenses and external costs of outside vendors, and other direct and indirect costs.

Research and development expenses consist principally of personnel costs, including salaries, stock-based compensation, and benefits for employees, third-party license fees and other operational costs related to its research and development activities, including allocated facility-related expenses and external costs of outside vendors, including CROs, and other direct and indirect costs.

Non-refundable research and development costs are deferred and expensed as the related goods are delivered or services are performed.

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Costs for certain research and development activities are recognized based on the pattern of performance of the individual arrangements, which may differ from the pattern of billings incurred, and are reflected in the consolidated financial statements as prepaid expenses or as accrued research and development expenses.

Under ASC 842, Leases (“ASC 842”), the Company determines if an arrangement is a lease at its inception.

Leases are classified as either operating or finance, based on the Company’s evaluation of certain criteria.

If a lease has a term greater than one year, the lease is recognized in the balance sheet as a right-of-use asset and a lease liability at lease commencement.

The Company elected the short-term lease practical expedient, therefore, if a lease has a term less than one year, the Company will not recognize the lease on its balance sheet.

The right-of-use asset represents the Company’s right of use to an underlying asset for the term of the lease and the lease liability represents the Company’s obligation to make lease payments arising from the lease.

If the Company’s leases do not provide an implicit rate within the lease, the Company uses its incremental borrowing rate, based on information available at the commencement date of the lease to determine the present value of the lease payments.

Operating lease right-of-use assets and operating lease liabilities are determined and recognized on the commencement date of the lease based on the present value of lease payments over the term of the lease.

For operating leases, rent expense is recognized on a straight-line basis over the term of the lease, and right-of-use assets are subsequently re-measured to reflect the effect of uneven lease payments.

For finance leases, right-of-use assets are amortized on a straight-line basis over the shorter of the lease term or the useful life of the underlying asset.

Expenses for finance leases include the amortization of right-of-use assets, which is recorded as depreciation and amortization expense, and interest expense, which reflects interest accrued on the lease liability.

The Company accounts for income taxes under the asset and liability method pursuant to authoritative guidance.

Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carryforwards.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

Under this authoritative guidance, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

If it is more likely than not that some portion or all of a deferred tax asset will not be recognized, a valuation allowance is recognized.

If it is more likely than not that some portion or all of a deferred tax asset will not be realized, a valuation allowance is recognized.

The Company accounts for uncertainty in income taxes using a recognition threshold of more-likely-than-not to be sustained upon examination by the appropriate taxing authority.

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The Company has determined that there were no uncertainties as of December 31, 2025 and 2024 that met the recognition threshold.

On July 4, 2025, President Trump signed H.R.1, the One Big Beautiful Bill Act (OB3) into law.

OB3 introduced significant changes to the U.S.

federal corporate tax system, including retroactive relief for certain small business taxpayers, such as reinstatement of immediate expensing for domestic research and development expenditures and modifications to the business interest expense limitation.

GAAP, the effects of changes in tax laws are recognized in the period in which the new law is enacted.

Accordingly, the provisions impacting the Company have been reflected in the financial statements for the year ended December 31, 2025, and did not have a material impact as the Company has a valuation allowance against its net deferred tax assets.

Equity-based Compensation

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The Company also has granted awards subject to performance-based vesting.

The Company would recognize compensation expense for these awards commencing in the period in which the vesting condition becomes probable of achievement.

Grant date fair value is estimated on the date of grant using the Black-Scholes option pricing model.

The Company recognizes compensation expense for these awards commencing in the period in which the vesting condition becomes probable of achievement.

The grant date fair value of stock options are estimated on the date of grant using the Black-Scholes option pricing model.

Forfeitures are recognized in the period in which they occur.

Black-Scholes requires inputs based on certain subjective assumptions, including (i) the expected stock price volatility, (ii) the expected term of the award, (iii) the risk-free interest rate and (iv) expected dividends.

Due to a lack of sufficient public market data for the Company’s common stock and lack of company-specific historical and implied volatility data, the Company has based its computation of expected volatility on the historical volatility of a representative group of public companies with similar characteristics to the Company, including stage of product development and life science industry focus.

science industry focus.

The historical volatility is calculated based on a period of time commensurate with expected term assumption.

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The expected dividend yield is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock.

Refer to note 9 for additional information.

Refer to Note 9 – Equity-based Compensation for additional information.

Concentration of Credit Risk

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● Level 3 — Inputs to the fair value measurement are unobservable inputs, such as estimates, assumptions, and valuation techniques when little or no market data exists for the assets or liabilities.

Other Comprehensive Gain

The Company recorded $ 0 and $ 4 in other comprehensive gain related to foreign currency translation for the years ended December 31, 2024 and 2023, respectively.

The Company presents comprehensive gain and loss in a single statement within its consolidated financial statements.

Warrant Accounting

Warrants are accounted for either as equity or liabilities based upon the characteristics and provisions of each instrument in accordance with ASC 815, Derivatives and Hedging , and ASC 480, Distinguishing Liabilities from Equity .

Warrants classified as equity are recorded at fair value as of the date of issuance on the consolidated balance sheets and no further adjustments to their valuation are made.

Warrants classified as liabilities and other financing instruments that require accounting as liabilities are recorded on the consolidated balance sheets at their fair value on the date of issuance and are revalued on each subsequent balance sheet date until such instruments are exercised or expire, with any changes

in the fair value between reporting periods recorded as other income or expense.

Management estimates the fair value of these liabilities using the Black-Scholes model and assumptions that are based on the individual characteristics of the warrants or instruments on the valuation date, as well as assumptions, expected volatility, expected life, yield, and risk-free interest rate.

Net Loss Per Share

Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during each period.

Diluted net loss per share includes the effect, if any, from the potential exercise or vesting of securities, such stock options and restricted stock units, which would result in the issuance of incremental shares of common stock.

Basic net loss per share is computed by dividing the net loss per share by the weighted-average number of shares of common stock outstanding during each period.

Diluted net loss per share includes the effect, if any, from the potential exercise or conversion of securities, such as convertible preferred stock and stock options, which would result in the issuance of incremental shares of common stock.

For diluted net loss per share, the weighted-average number of shares of common stock is the same for basic net loss per share due to the fact that when a net loss exists, dilutive securities are not included in the calculation as the impact is anti-dilutive.

The Company has determined that it operates and manages one operating segment, which is the business of development of clinical and preclinical product candidates for neurodegenerative disorders, such as AD and DLB.

The Company’s chief operating decision maker, its chief executive officer, reviews financial information on an aggregate basis for the purpose of allocating resources.

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Recent Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which enhances segment disclosures and requires additional disclosures of segment expenses.

This ASU is effective for annual periods in fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024.

We adopted this ASU for the annual period ended December 31, 2024 and the amendments have been applied retrospectively to all prior periods presented in the financial statements by expanding the disclosure of expenses included in our segment measures of profitability.

Refer to Note 13 - Segment Reporting for more information.

Not Yet Adopted

Recently Adopted

In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements (“ASU 2023-06”), to clarify or improve disclosure and presentation requirements of a variety of topics and align the requirements in the FASB ASC with the SEC's regulations.

The amendments apply to all reporting entities within the scope of the affected topics unless otherwise indicated.

The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited.

The Company adopted ASU 2023-06 for the annual period ended December 31, 2025 which did not have a material impact on the consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”), which improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction.

It also includes certain other amendments to improve the effectiveness of income tax disclosures.

The Company adopted the new standard during the year ended December 31, 2025 and the amendment has been applied retrospectively to all prior periods presented in the consolidated financial statements.

Refer to Note 12 – Income Taxes for more information..

Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses (“ASU 2024-03”), which requires public business entities to provide more detailed information in the notes to the financial statements about specified categories of expenses (purchases of inventory, employee compensation, depreciation and amortization) included

in certain expense captions presented on the consolidated statement of operations and comprehensive loss.

The guidance is effective for annual periods beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027.

Early adoption is permitted.

The amendments may be applied either (1) prospectively to financial statements issued for periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the consolidated financial statements.

The Company is currently evaluating the impact that this guidance will have on its consolidated financial statements and disclosures.

In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606) (“ASU 2025-07”), to clarify the application of derivative accounting to contracts with features based on the operations or activities of one of the parties to the contract and the diversity in accounting for share-based noncash consideration from a customer that is consideration for the transfer of goods or services.

ASU 2025-07 is effective for the fiscal year beginning after December 15, 2026, and interim periods within those annual reporting periods.

The Company is currently evaluating ASU 2025-07 to determine its impact on the Company’s consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”).

The standard enhances transparency in income tax disclosures by requiring, on an annual basis, certain disaggregated information about a reporting entity’s effective tax rate reconciliation and income taxes paid.

The ASU also requires disaggregated disclosure related to pre-tax income (or loss) and income tax expense (or benefit) and eliminates certain disclosures related to the balance of an entity’s unrecognized tax benefit and the cumulative amount of certain temporary differences.

The ASU is effective for the Company beginning on January 1, 2025.

The Company is currently evaluating ASU 2023-09 to determine its impact on the Company's disclosures.

In December 2025, the FASB issued ASU 2025-10, Government Grants under ASC 832 (“ASU 2025-10”), which establishes authoritative guidance on the recognition, measurement, presentation, and disclosure of government grants.

Under ASU 2025-10, government grants are recognized when it is probable that the entity will both comply with the conditions of the grant and the grant will be received.

The ASU provides specific accounting models for grants related to assets and grants related to income, including options to recognize government grants as deferred income or as a reduction of the asset’s cost basis.

The ASU also requires enhanced disclosures regarding the nature of government grants, significant terms and conditions, accounting policies applied, and amounts recognized in the financial statements.

ASU 2025-10 is effective for fiscal years beginning after December 15, 2028, including interim periods within those fiscal years, with early adoption permitted.

The Company is currently evaluating the impact of adopting ASU 2025-10 on its consolidated financial statements and related disclosures.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270):

Narrow-Scope Improvements (“ASU 2025-11”), which clarifies the guidance in Topic 270 to improve the consistency of interim financial reporting.

The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity.

ASU 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted.

The Company is currently evaluating the impact of adopting ASU 2025-11 on its consolidated financial statements and related disclosures.

Financial Instruments and Fair Value Measurements

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Observable Inputs

Cash equivalents:

Money market funds

Restricted cash equivalents:

Money market funds

As of December 31, 2024

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Observable Inputs

Cash equivalents:

Money market funds

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Total payments of approximately $ 62 , including interest and principal, are due monthly from November 2023 through October 2024.

As of December 31, 2023, the outstanding principal of the loan was $ 544 and the amount was paid off in 2024 .

The outstanding principal of the loan was paid off in October 2024.

In October 2024, the Company entered into an insurance premium financing agreement with a lender.

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Total payments of approximately $ 41 , including interest and principal, are due monthly from November 2024 through July 2025.

The outstanding principal of the loan was paid off in July 2025.

In October 2025, the Company entered into an insurance premium financing agreement with a lender.

Under the agreement, the Company financed $ 381 of certain premiums at a 7.95 % annual interest rate.

Total payments of approximately $ 40 , including interest and principal, are due monthly from November 2025 through August 2026.

As of December 31, 2025, the outstanding principal of the loan was $ 307 .

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Operating Leases

The Company’s principal executive offices are located in Purchase, New York where we currently occupy 2,864 square feet of office space under a lease that expires in May of 2029.

The Company’s principal executive offices are located in Purchase, New York where the Company currently occupies 2,864 square feet of office space under a lease that expires in May of 2029.

The Company also leases approximately 6,068 square feet of laboratory and office space located in Pittsburgh, Pennsylvania under leases that expire in June of 2026.

On August 31, 2022, the Company entered into a lease agreement for approximately 2,980 square feet of office space located in Pittsburgh, Pennsylvania.

The lease has a term of 45 months and commenced on October 1, 2022.

Additionally, on August 31, 2022, the Company and Landlord modified one of its existing lease agreements for approximately 3,706 square feet of lab space at the same location to extend the lease term termination date from June 30, 2023 until June 30, 2026.

Amounts reported in the consolidated balance sheets for leases where the Company is the lessee as of December 31, 2025 and 2024 were as follows, in thousands:

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The Shelf was declared effective on January 3, 2023 by the SEC.

The Company also simultaneously entered into a sales agreement with the Sales Agents providing for the offering, issuance and sale by the Company of up to $ 40,000 of its common stock from time to time in ATM offerings under the Shelf.

The Company also simultaneously entered into the Previous Sales Agreement with B.

Riley providing for the offering, issuance and sale by the Company of up to $ 40,000 of its common stock from time to time in ATM offerings under the Shelf.

The Company sold 13,624,062 shares of common stock pursuant to the 2022 ATM during the year ended December 31, 2025, for gross proceeds of approximately $ 9,409 .

As of December 31, 2024, there was $ 21,874 remaining of common stock available for sale under the ATM, subject to the limitations of General Instruction I.B.6 of Form S-3.

On December 16, 2025, the Company delivered written notice to B.

Riley to terminate the Previous Sales Agreement, effective December 18, 2025.

The Company is not subject to any termination penalties related to the termination of the Previous Sales Agreement.

Prior to termination, approximately $ 12,465 remained in gross proceeds available for future issuances of common stock under the 2022 ATM.

On December 18, 2025, we filed a shelf registration statement with the SEC and a prospectus supplement, which registered the offering, issuance and sale of up to $ 300.0 million of various equity and debt securities and up to $ 75,000 of common stock pursuant to an at-the-market equity offering program with Jefferies.

For the period ended December 31, 2025, the Company did no t sell any shares of common stock pursuant to the 2025 ATM.

As of December 31, 2025, $ 75,000 remain in gross proceeds available for future issuances of common stock under the 2025 ATM.

Lincoln Park Purchase Agreement

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The Company recorded $ 318 to other expense, net during the year ended December 31, 2023 in connection with the issuance of the Commitment Shares.

During the year ended December 31, 2023, the Company sold 125,000 shares of common stock to Lincoln Park for proceeds of $ 205 , as part of the equity line financing arrangement.

During the year ended December 31, 2025, the Company did not sell any shares of common stock to Lincoln Park.

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March 2024 Offering

In March 2024, the Company entered into an underwriting agreement with Titan Partners Group LLC, a division of American Capital Partners, LLC, relating to the issuance and sale by the Company of 7,557,142 shares of its common stock, which included the exercise of the underwriters’ option to purchase 985,714 additional shares of common stock, at a public offering price of $ 1.75 per share.

In March 2024, the Company entered into an underwriting agreement with Titan relating to the issuance and sale by the Company of 7,557,142 shares of its common stock, which included the exercise of the underwriters’ option to purchase 985,714 additional shares of common stock, at a public offering price of $ 1.75 per share.

The Company closed this offering on March 14, 2024 and the full exercise of the underwriters’ option to purchase 985,714 additional shares of common stock was closed on March 28, 2024.

The Company received net proceeds of approximately $ 11,896 , after deducting $ 1,329 of underwriting discounts and commissions and other offering related expenses payable by the Company.

August 2025 Registered Direct Offering and Warrant Issuance

The Company also entered into a Placement Agency Agreement on such date (the “Purchase Agency Agreement”) with Titan acting as the sole placement agent for the Registered Direct Offering.

The Company closed this offering on August 29, 2025.

The Company received net proceeds of approximately $ 27,890 , after deducting $ 2,245 of underwriting discounts, commissions, placement agent fees, and other offering related expenses payable by the Company.

In connection with the Placement Agency Agreement, the Company agreed to pay Titan an aggregate cash fee of 7.0 % of the gross proceeds raised from the sale and issuance of the shares of common stock minus certain expenses.

Additionally, the Company agreed to issue warrants to Titan to purchase up to 514,500 shares of common stock (the “Placement Agent Warrants”).

The Placement Agent Warrants have an exercise price equal to $ 2.78 and will be exercisable commencing six months from the close of the Registered Direct Offering with a term of five (5) years from the date of the Placement Agency Agreement.

The Placement Agent Warrants are equity classified as the warrants do not contain a required cash settlement adjustment feature with respect to a transaction outside of the Company’s control or not deemed to be indexed to the Company’s stock.

The Placement Agent Warrants were issued for services performed by the placement agent and were treated as offering costs.

The aggregate fair value was determined to be approximately $ 853 using the Black-Scholes pricing model with the following assumptions:

79.97 % volatility, risk free interest rate of 3.59 %, an expected life of 2.8 years and no dividend.

The aggregate fair market value was recorded as an offset to gross proceeds of the Registered Direct Offering and an increase to additional paid-in capital.

As of December 31, 2025, the Company had the following equity-classified common stock warrants outstanding:

Weighted-Average

Contractual Life

Exercise Price

Balance, December 31, 2024

Balance, December 31, 2025

Exercisable as of December 31, 2025

Equity-based Compensation

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The 2021 Plan authorizes the award of both equity-based and cash-based incentive awards, including:

(i) stock options (both incentive stock options and nonqualified stock options), (ii) stock appreciation rights, (iii) restricted stock awards, (iv) restricted stock units, or RSUs, and (v) cash or other stock-based awards.

(i) stock options (both incentive stock options and nonqualified stock options), (ii) stock appreciation rights, (iii) restricted stock awards, (iv) restricted stock units (“RSUs”), and (v) cash or other stock-based awards.

Incentive stock options may be granted only to employees.

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On September 15, 2017, the Company’s board of directors approved the 2017 Plan, which provides for the granting of incentive stock options, non-qualified stock options and stock awards to employees, certain consultants and directors.

The Board, or its designated committee, has the sole authority to select the individuals to whom awards are granted and determine the terms of each award, including the number of shares and the schedule upon which the award becomes exercisable.

The board of directors, or its designated committee, has the sole authority to select the individuals to whom awards are granted and determine the terms of each award, including the number of shares and the schedule upon which the award becomes exercisable.

Upon the effectiveness of the 2021 Plan, no further awards will be granted under the 2017 Plan.

The aggregate number of shares of common stock of the Company that may be issued under the 2017 Plan is 4,334,131 (taking into account shares of common stock that may become issuable pursuant to Section 3(b) of the 2017 Plan in respect of shares of common stock reserved under the Company’s Amended and Restated 2007 Equity Incentive Plan).

The 2021 Plan allows for a provision for shares granted under the Prior Plans which are cancelled, forfeited, exchanged or surrendered without having been exercised to subsequently be available for reissuance under the 2021 Plan.

The 2021 Plan provides for shares granted under the Prior Plans which are cancelled, forfeited, exchanged or surrendered without having been exercised shall subsequently be available for reissuance under the 2021 Plan.

Employee Stock Purchase Plan

The Company’s board of directors approved the Employee Stock Purchase Plan, or ESPP, prior to the closing of the IPO.

The Company’s board of directors approved the Employee Stock Purchase Plan (the “ESPP”) prior to the closing of the IPO.

Under the ESPP, the Company may provide employees and employees of the Subsidiary with an opportunity to purchase shares of the Company’s common stock at a discounted purchase price.

As of December 31, 2024, a total of 209,532 shares of common stock was authorized and reserved for issuance under the ESPP.

Subject to prior approval by the board of directors in each instance, on or about January 1, 2022 and each anniversary of such date thereafter prior to the termination of the ESPP, the number of shares of common stock authorized and reserved for issuance under the ESPP will be increased by a number of shares of common stock equal to the least of (i) 1,000,000 shares of our common stock, (ii) 1 % of the shares of common stock outstanding on the final day of the immediately preceding calendar year, and (iii) such smaller number of shares of common stock as determined by the board of directors.

As of December 31, 2025, a total of 209,532 shares of common stock are authorized and reserved for issuance under the ESPP.

Subject to prior approval by the board of directors in each instance, on or about January 1, 2022 and each anniversary of such date thereafter prior to the termination of the ESPP, the number of shares of common stock authorized and reserved for issuance under the ESPP will be increased by a number of shares of common stock equal to the least of (i) 1,000,000 shares of common stock, (ii) 1 % of the shares of common stock outstanding on the final day of the immediately preceding calendar year, and (iii) such smaller number of shares of common stock as determined by the board of directors.

Such shares of common stock may be newly issued shares, treasury shares or shares acquired on the open market.

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91.78 % – 92.29 %

91.47 % – 92.68 %

Risk-free interest rate

4.23 % – 4.45 %

3.46 % – 4.71 %

Dividend yield

Expected term (years)

Expected Term — The expected term represents the period that the stock-based awards are expected to be outstanding.

As the Company does not have sufficient historical experience for determining the expected term of the stock option awards granted, expected term has been calculated using the simplified method.

Risk-Free Interest Rate — The risk-free interest rate is based on the U.S.

Treasury yield curve in effect at the date of grant for zero-coupon U.S.

Treasury constant maturity notes with terms approximately equal to the stock-based awards’ expected term.

During the year ended December 31, 2025, there were no stock options granted.

Expected Volatility — Up until October 13, 2021, the Company was privately held and did not have a trading history of common stock.

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The Company will continue to derive expected volatility from average historical stock volatilities of industry peers until the Company has compiled a trading history of its own for a sufficient period of time.

Risk-Free Interest Rate — The risk-free interest rate is based on the U.S.

Treasury yield curve in effect at the date of grant for zero-coupon U.S.

Treasury constant maturity notes with terms approximately equal to the stock-based awards’ expected term.

Dividend Yield — The expected dividend yield is zero as the Company has not paid and does not anticipate paying any dividends in the foreseeable future.

Expected Term — The expected term represents the period that the stock-based awards are expected to be outstanding.

As the Company does not have sufficient historical experience for determining the expected term of the stock option awards granted, expected term has been calculated using the simplified method.

Activity for options was as follows:

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Exercisable as of December 31, 2025

There were no grants of stock options for the year ended December 31, 2025.

The weighted-average grant date fair value of stock options granted was $ 0 and $ 1.56 during the years ended December 31, 2025 and 2024, respectively.

There were 247,500 stock options granted at an aggregate fair value of $ 385 for the year ended December 31, 2024 and 628,769 stock options granted at an aggregate fair value of $ 983 for the year ended December 31, 2023.

During the year ended December 31, 2024 and 2023, there were 93,350 and 0 stock options

exercised, respectively, with an aggregate grant date fair value of $ 58 and $ 0 , respectively.

There were no stock options granted during the year ended December 31, 2025 and 247,500 stock options granted at an aggregate fair value of $ 385 for the year ended December 31, 2024.

During the year ended December 31, 2025 and 2024, there were 50,375 and 93,250 stock options exercised, respectively, with an aggregate grant date fair value of $ 39 and $ 58 , respectively.

The intrinsic value of stock options exercised during the year ended December 31, 2025 and 2024 was $ 54 and $ 121 , respectively.

Restricted Stock Units

The fair values of RSUs are based on the fair market value of the Company’s common stock on the date of grant.

The fair values of restricted stock units (“RSUs”) are based on the fair market value of the Company’s common stock on the date of grant.

Each RSU represents a contingent right to receive one share of the Company’s common stock upon vesting.

RSUs with time base vesting conditions for employees vest annually over three or four years on each anniversary of the Grant Date and RSUs for non-employee directors vest on the one-year anniversary of the Grant Date.

RSUs with performance conditions for employee’s vest on the one-year anniversary of the performance achievement date, assuming continued service from the employee during that period of time.

For the year ended December 31, 2024 and 2023, the Company granted 358,200 and 542,419 RSUs awards, respectively, containing time based vesting conditions to employees and non-employee directors.

For the year ended December 31, 2024 and 2023, the Company granted 515,600 and 0 RSUs awards, respectively, containing performance based vesting conditions to employees.

During the year ended December 31, 2024, the performance conditions were achieved and RSUs will vest on the one-year anniversary of the achievement of the performance condition.

As of December 31, 2024, the Company had no outstanding performance condition.

RSUs with performance conditions for employees vest on the one-year anniversary of the performance achievement date, assuming continued service from the employee during that period of time.

For the year ended December 31, 2025 and 2024, the Company granted 2,867,409 and 358,200 RSUs awards, respectively, containing time-based vesting conditions to employees, non-employees, and non-employee directors.

For the year ended December 31, 2025 and 2024, the Company granted 0 and 515,600 RSU awards, respectively, containing performance and time-based vesting conditions to employees.

The performance conditions for the RSU awards granted in 2024 were achieved in 2024 and the RSUs vest on the one-year anniversary of the achievement of the performance condition.

As of December 31, 2025, the RSU awards containing performance conditions granted in 2024 had no remaining performance conditions.

The following table summarizes the Company’s RSU activity for the year ended December 31, 2025:

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As of December 31, 2025, total future compensation expense related to unvested time-based awards yet to be recognized by the Company was $ 1,728 , which is expected to be recognized over a weighted-average remaining vesting period of approximately 2.6 years.

As of December 31, 2024, total future compensation expense related to unvested performance-based awards yet to be recognized by the Company was $ 462 , which is expected to be recognized over a weighted-average remaining vesting period of approximately 0.8 years.

As of December 31, 2025, there was no future compensation expense related to unvested performance-based awards yet to be recognized by the Company.

Net Loss per Share

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Restricted stock units issued and outstanding

Warrants issued and outstanding

Retirement Plan

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Company matching contributions to the 401(k) retirement plan totaled $ 251 and $ 265 for the year ended December 31, 2025 and 2024, respectively.

The net loss consists of the following components:

Year Ended December 31,

During the years ended December 31, 2025 and 2024 the Company incurred pre-tax losses from its domestic operations of $ 23,487 and $ 33,971 , respectively.

During the years ended December 31, 2025 and 2024, the Company recorded no current or deferred income tax expenses or benefits as the Company has incurred losses since inception and has provided a full valuation allowance against its deferred tax assets.

Effective January 1, 2022, the Tax Cuts and Jobs Act of 2017 requires the Company to capitalize, and subsequently amortize R&D expense over five years for research activities conducted in the United States and over fifteen years for research activities conducted outside of the United States.

A reconciliation of the expected income tax (benefit) computed using the federal statutory income tax rate to the Company’s effective income tax rate is as follows:

The Tax Cuts and Jobs Act of 2017 required the Company to capitalize and subsequently amortize research and development expenditures over five years for research activities conducted in the United States and over fifteen years for research activities conducted outside of the United States, effective January 1, 2022.

On July 4, 2025, the One Big Beautiful Bill Act was enacted in the U.S.

and introduced significant changes, including retroactive relief for certain small business taxpayers, such as reinstatement of immediate expensing for domestic research and development expenditures and modifications to the business interest expense limitation.

As a result, the Company amended its federal and state income

tax returns for tax years 2022 through 2024 to reflect the immediate expensing of domestic research and development expenditures.

The Company adopted ASU 2023-09 "Income Taxes (Topic 740):

Improvements To Income Tax Disclosures" on a retrospective basis beginning with the year ended December 31, 2025.

A reconciliation of the U.S.

federal statutory amount and rate to the Company’s effective income tax amount and rate for the year ended December 31, 2025 and December 31, 2024 is as follows:

Year Ended December 31, 2025

Income tax computed at federal statutory rate

State taxes, net of federal benefit

Year Ended December 31, 2024

Tax benefit at the U.S.

statutory rate

Foreign Tax Effects

Change in valuation allowance

Entity dissolution

Federal research and development

Nontaxable or Nondeductible Items

Equity based compensation

Effective income tax rate

Change in valuation allowance

Tax on Income

The Company’s deferred tax assets and liabilities consist of the following:

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The Company has evaluated the positive and negative evidence bearing upon its ability to realize the deferred tax assets as of December 31, 2025 and 2024.

Management has considered the Company’s history of cumulative net losses and has concluded as of December 31, 2024 and 2023, that it was more likely than not that the Company will not realize all of the benefits of the deferred tax assets.

Management has considered the Company’s history of cumulative net losses and has concluded that as of December 31, 2025 and 2024, that it was more likely than not that the Company will not realize all of the benefits of the deferred tax assets.

Accordingly, a full valuation allowance has been established against the deferred tax assets as of December 31, 2025 and 2024.

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The increase in valuation allowance in 2025 was primarily a result of operating losses and tax credits generated.

The Company incurred net operating losses (“NOL”) since inception through December 31, 2021 and year ended December 31, 2024.

Due to tax law changes, effective January 1, 2022, requiring the Company to capitalize and amortize R&D expenses, the Company was in a taxable position as of December 31, 2023 and 2022, and has utilized NOL generated in prior years to fully offset their income tax expense.

As of December 31, 2024, the Company had federal net operating loss carryforwards of $ 38,063 , net of Section 382 limited amounts.

The Company incurred net operating losses (“NOL”) since inception through December 31, 2025.

As of December 31, 2025, the Company had federal net operating loss carryforwards of $ 136,687 net of amounts limited under Section 382.

Included in federal net operating loss carryforwards of $ 136,687 is $ 25,639 that begin to expire in 2029 and $ 111,048 that can be carried forward indefinitely.

As of December 31, 2025, the Company had state net operating loss carryforwards of $ 54,849 , available to reduce future state taxable income, which will begin to expire in 2027.

As of December 31, 2025, the Company also had $ 4,463 of federal research and development tax credit carryforwards available to reduce future income taxes, which will begin to expire in 2029, if not utilized.

During the year ended December 31, 2024, the Company ceased operations of its wholly owned foreign subsidiary.

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Utilization of the Company’s net operating loss carryforwards and research and development tax credit carryforwards may be subject to a substantial annual limitation under Section 382 of the Internal Revenue Code of 1986 due to ownership changes that have occurred previously or that could occur in the future.

In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50% over a three-year period.

These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income.

These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income or tax.

The amount of the limitation is determined based on the value of the Company immediately prior to the ownership change and could be subject to additional adjustments as required.

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This analysis showed an ownership change occurred in January 2009 and the Section 382 limitation would result in $ 589 of federal net operating loss carryforwards expiring unutilized.

The Company updated the analysis through December 31, 2024 and determined that it is more-likely-than-not that the Company’s existing net operating loss and research and

development tax credit carryforwards could be utilized to offset current and future taxable income or tax, respectively, due to the conclusion that an ownership change did not occur in 2024.

The Company updated the analysis through December 31, 2024 and determined that it is more-likely-than-not that an ownership change did not occur in 2023 and 2024.

An assessment to determine whether there may have been a Section 382 ownership change occurred during 2025 has not be completed.

If a change in ownership were to have occurred during the period, and resulted in the restriction of net operating loss and tax credit carryforwards, the reduction in the related deferred tax asset would be offset with a corresponding reduction in the valuation allowance.

The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates.

In the normal course of business, the Company is subject to examination by federal and state jurisdictions, where applicable.

There are currently no pending tax examinations.

The Company is open to further tax examination under statue for tax years beginning on or after January 1, 2021;

Several tax returns are under examination.

The Company is open to further tax examination under statute for tax years beginning on or after January 1, 2022;

however, carryforward attributes that were generated prior to January 1, 2022 may still be adjusted upon examination by federal, state or local tax authorities if they either have been or will be used in a future period.

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Operating segments are defined as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker (CODM), or decision-making group, in making decisions on how to allocate resources and assess performance.

The Company views its operations and manages its business in one operating segment related to the development of clinical and preclinical product candidates for neurodegenerative disorders, such as AD and DLB.

The Company’s Chief Executive Officer (“CEO”) serves as the CODM.

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The measure of segment assets is reported on the consolidated balance sheets as total assets.

The table below is a summary of the segment loss, including significant segment expenses (in thousands):

The table below is a summary of the segment loss, including significant segment expenses:

Year Ended December 31,

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(3) Other segment items include, Other income, net, Interest expense and Loss on currency translation from liquidation of subsidiary .

Subsequent Events

On March 10, 2026, the Company’s Lincoln Park Purchase Agreement expired.

There was no activity with the Lincoln Park Purchase Agreement between January 1, 2026 and March 10, 2026.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data