CorMedix Inc. 10-K

Item 9A. 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 management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in the Exchange Act Rules 13a-15(e) and 15d-15(e)) (the “Exchange Act”). Based on the foregoing evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures. 38 Changes in Internal Control Over Financial Reporting There were no changes in our internal control over financial reporting during our year ended December 31, 2024, or in other factors that could significantly affect these controls, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Management’s Annual Report on Internal Controls Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting and for the assessment of the effectiveness of internal control over financial reporting. As defined by the Securities and Exchange Commission, internal control over financial reporting is a process designed by, or under the supervision of, our principal executive and principal financial officers and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the consolidated financial statements in accordance with U.S. generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect our transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of the consolidated financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements. 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. In connection with the preparation of our annual consolidated financial statements, management, including, our Principal Executive and Financial Officer, has undertaken an assessment of the effectiveness of our internal control over financial reporting as of December 31, 2024, based on the criterial established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Management’s assessment included an evaluation of the design of our internal control over financial reporting and testing of the operational effectiveness of those controls. Based on this evaluation, management has concluded that our internal control over financial reporting was effective as of December 31, 2024. 39 Item 9B. Other Information Rule 10b5-1 Plans During the three months ended December 31, 2024, no director or officer of the Company (as defined in Rule 16a-1(f) under the Exchange Act) informed us of the adoption or termination of a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408 of SEC Regulation S-K. 2025 Annual Meeting of Shareholders We currently plan to hold our 2025 Annual Meeting of Shareholders (the “2025 Annual Meeting”) on June 24, 2025. The time and location of the 2025 Annual Meeting, and the matters to be considered, will be as set forth in our definitive proxy statement for the 2025 Annual Meeting to be filed with the SEC. Because the scheduled date of the 2025 Annual Meeting is more than 30 days from the anniversary of the Company’s 2024 Annual Meeting of Stockholders, prior disclosed deadlines regarding the submission of stockholder proposals pursuant to Rule 14a-8 (“Rule 14a-8”) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), for the 2025 Annual Meeting are no longer applicable. The Company is hereby providing notice of certain revised deadlines for the submission of stockholder proposals in connection with the 2025 Annual Meeting. In order for a stockholder proposal, submitted pursuant to Rule 14a-8, to be considered timely for inclusion in the Company’s proxy statement and form of proxy for the 2025 Annual Meeting, such proposal must be received by the Company by April 8, 2025, which the Company determined to be a reasonable time before the Company plans to begin printing and mailing its proxy materials. Therefore, in order for a stockholder to submit a proposal for inclusion in the Company’s proxy materials for the 2025 Annual Meeting, the stockholder must comply with the requirements set forth in Rule 14a-8, including with respect to the subject matter of the proposal, and must deliver the proposal and all required documentation to the Company no later than April 8, 2025. The public announcement of an adjournment or postponement of the date of the 2025 Annual Meeting will not commence a new time period (or extend any time period) for submitting a proposal pursuant to Rule 14a-8. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 40 PART III Item 10. Directors, Executive Officers, and Corporate Governance The information required by this Item will be included in our Proxy Statement, which will be filed within 120 days after the close of the 2024 fiscal year, or an amendment to this Annual Report, and is hereby incorporated by reference. Code of Ethics We have adopted a written Code of Conduct and Ethics that applies to our directors, executive officers and all employees. We intend to disclose any amendments to, or waivers from, our code of ethics and business conduct that are required to be publicly disclosed pursuant to rules of the SEC by filing such amendment or waiver with the SEC. This code of ethics and business conduct can be found in the “Investors - Corporate Governance” section of our website, www.cormedix.com . Insider Trading Policy We have adopted insider trading and 10b5-1 trading plan policies and procedures applicable to our directors, officers, employees, and other covered persons, and have implemented processes for the company, that we believe are reasonably designed to promote compliance with insider trading laws, rules and regulations, and the Nasdaq Stock Market LLC listing standards. Our insider trading policy and our 10b5-1 trading plan policy are filed as Exhibit 19.1 to this Annual Report on Form 10-K. Item 11. Executive Compensation The information required by this Item will be included in our Proxy Statement, which will be filed within 120 days after the close of the 2024 fiscal year, or an amendment to this Annual Report, and is hereby incorporated by reference. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholders Matters The information required by this Item will be included in our Proxy Statement, which will be filed within 120 days after the close of the 2024 fiscal year, or an amendment to this Annual Report, and is hereby incorporated by reference. Item 13. Certain Relationships and Related Transactions and Director Independence The information required by this Item will be included in our Proxy Statement, which will be filed within 120 days after the close of the 2024 fiscal year, or an amendment to this Annual Report, and is hereby incorporated by reference. Item 14. Principal Accountant Fees and Services The information required by this Item will be included in our Proxy Statement, which will be filed within 120 days after the close of the 2024 fiscal year, or an amendment to this Annual Report, and is hereby incorporated by reference. 41 PART IV Item 15. Exhibits, Financial Statement Schedules 1. Financial Statements . The following consolidated financial statements of CorMedix Inc. are filed as part of this Annual Report on Form 10-K: Report of Independent Registered Public Accounting Firm (PCAOB ID # 688) F-2 Consolidated Balance Sheets as of December 31, 2024 and 2023 F-3 Consolidated Statements of Operations and Comprehensive Income (Loss) Years Ended December 31, 2024 and 2023 F-4 Consolidated Statements of Changes in Stockholders’ Equity Years Ended December 31, 2024 and 2023 F-5 Consolidated Statements of Cash Flows Years Ended December 31, 2024 and 2023 F-6 Notes to Consolidated Financial Statements F-7 2. Financial Statement Schedules. The Financial Statement Schedules have been omitted because of the absence of conditions under which they are required or because the required information, where material, is shown in the financial statements or notes thereto. 3. Exhibit Index . The following is a list of exhibits filed as part of this Annual Report on Form 10-K: Exhibit Number Description of Document Registrant’s Form Dated Exhibit Number Filed or Furnished Herewith 1.1 At-the-Market Issuance Sales Agreement, dated August 12, 2021, by and among CorMedix Inc., Truist Securities, Inc. and JMP Securities LLC 8-K 08/12/2021 1.1 3.1 Form of Amended and Restated Certificate of Incorporation S-1/A 3/01/2010 3.3 3.2 Certificate of Amendment to Amended and Restated Certificate of Incorporation, dated February 24, 2010 S-1/A 3/19/2010 3.5 3.3 Second Amended and Restated Bylaws as amended October 8, 2020 8-K 10/14/2020 3.1 3.4 Certificate of Amendment to Amended and Restated Certificate of Incorporation, dated December 3, 2012 10-K 3/27/2013 3.3 3.5 Certificate of Amendment to Amended and Restated Certificate of Incorporation, dated August 9, 2017 8-K 8/10/2017 3.1 3.6 Certificate of Amendment to Amended and Restated Certificate of Incorporation, dated March 25, 2019 8-K 3/25/2019 3.1 3.7 Amended and Restated Certificate of Designation of Series C-3 Non-Voting Convertible Preferred Stock of CorMedix Inc., filed with the Delaware Secretary of State on September 15, 2014 8-K 9/16/2014 3.16 42 Exhibit Number Description of Document Registrant’s Form Dated Exhibit Number Filed or Furnished Herewith 3.8 Second Amended and Restated Certificate of Designation of Series E Convertible Preferred Stock of CorMedix Inc., filed with the Delaware Secretary of State on September 5, 2019 8-K 9/11/2019 3.2 3.9 Certificate of Designation of Series G Convertible Preferred Stock of CorMedix Inc., filed with the Delaware Secretary of State on September 5, 2019 8-K 9/11/2019 3.1 4.1 Specimen of Common Stock Certificate S-1/A 3/19/2010 4.1 4.2 Form of Warrant issued on January 8, 2014. 8-K 1/09/2014 4.23 4.3 Form of Series B Warrant to Purchase Common Stock of CorMedix Inc. issued on May 3, 2017 8-K 5/03/2017 4.2 4.4 Form of Underwriter’s Warrant to Purchase Common Stock of CorMedix Inc., issued May 3, 2017 8-K 5/03/2017 4.3 4.5 Description of Capital Stock of CorMedix Inc. 10-K 03/16/2020 4.5 4.6 Form of Pre-Funded Warrant issued June 28, 2023 8-K 06/30/2023 4.1 10.1* License and Assignment Agreement, dated as of January 30, 2008, between CorMedix Inc. and ND Partners LLC S-1/A 12/31/2009 10.5 10.2+ Form of Indemnification Agreement between CorMedix Inc. and each of its directors and executive officers 10-Q 5/15/2023 10.1 10.3**+ Executive Employment Agreement, dated and effective May 11, 2020, between CorMedix Inc. and Matthew David 10-K 3/30/2021 10.10 10.4+ Letter Agreement, dated and effective October 26, 2021, between CorMedix Inc. and Matthew David, M.D. 8-K 10/29/2021 10.1 10.5 Form of Securities Purchase Agreement, dated November 17, 2017, between CorMedix Inc. and the investors signatory thereto 8-K 11/13/2017 10.1 10.6 Backstop Agreement, dated November 9, 2017, between CorMedix Inc. and the investor named therein 8-K 11/13/2017 10.2 10.7 Form of Registration Rights Agreement, dated November 9, 2017, by and between CorMedix Inc. and the investor named therein 8-K 11/13/2017 10.3 10.8 Amendment No. 1, dated as of December 11, 2017, to Registration Rights Agreement, dated November 9, 2017, by and between CorMedix Inc. and the investor named therein 8-K 12/11/2017 10.1 10.9**+ Executive Employment Agreement, dated and effective March 10, 2021, between CorMedix Inc. and Elizabeth Hurlburt 8-K 3/12/2021 10.1 10.10 Securities Purchase Agreement, dated December 31, 2018, between CorMedix Inc. and the investor named therein 8-K 1/03/2019 10.1 10.11 Securities Exchange Agreement, dated August 14, 2019, by and among CorMedix Inc. and the Existing Security holders listed on the Schedule of Holders thereto 8-K 8/15/2019 10.1 43 Exhibit Number Description of Document Registrant’s Form Dated Exhibit Number Filed or Furnished Herewith 10.12 Amended and Restated Registration Rights Agreement, dated as of September 6, 2019, by and among CorMedix Inc. and Manchester Securities Corp., and Elliot International, L.P. and Elliot Associates, L.P. 8-K 9/11/2019 10.1 10.13 Amended and Restated 2019 Omnibus Stock Incentive Plan S-8 10/26/2022 99.1 10.14+ 2021 Executive Bonus Plan 8-K 12/23/2021 10.1 10.15+ Executive Employment Agreement, dated March 16, 2022, between CorMedix Inc. and Joseph Todisco. 8-K 03/21/2022 10.2 10.16+ Executive Employment Agreement, dated December 12, 2023, between CorMedix Inc. and Beth Zelnick Kaufman. X 10.17 Amendment No. 1 to the Amended and Restated CorMedix Inc. 2019 Omnibus Stock Incentive Plan 8-K 11/21/2024 10.1 19.1 Insider Trading Policies and Procedures X 21.1 List of Subsidiaries 10-K 3/27/2013 21.1 23.1 Consent of Independent Registered Public Accounting Firm X 31.1 Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. X 31.2 Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 32.1*** Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 32.2*** Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 97.1 Board Policy on Recouping Incentive Compensation 10-K 3/12/2024 97.1 101.INS Inline XBRL Instance Document X 101.SCH Inline XBRL Taxonomy Extension Schema Document. X 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document. X 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document. X 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document. X 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document. X 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). X * Confidential treatment has been granted for portions of this document. The omitted portions of this document have been filed separately with the SEC. ** Portions of the exhibit have been omitted in reliance on Item 601(b)(10)(iv) of Regulation S-K. *** These certifications are furnished. + Indicates management contract or compensation plan. Item 16. Form 10-K Summary Not applicable. 44 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CORMEDIX INC. March 25, 2025 By: /s/ Joseph Todisco Joseph Todisco Chief Executive Officer (Principal Executive Officer) March 25, 2025 By: /s/ Matthew David Matthew David Chief Financial Officer (Principal Financial and Accounting Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report 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/ Joseph Todisco Chief Executive Officer and Director March 25, 2025 Joseph Todisco (Principal Executive Officer) /s/ Matthew David Executive Vice President and Chief Financial Officer March 25, 2025 Matthew David (Principal Financial and Accounting Officer) /s/ Myron Kaplan Director and Chairman of the Board March 25, 2025 Myron Kaplan /s/ Janet Dillione Director March 25, 2025 Janet Dillione /s/ Gregory Duncan Director March 25, 2025 Gregory Duncan /s/ Alan Dunton Director March 25, 2025 Alan Dunton /s/ Steven Lefkowitz Director March 25, 2025 Steven Lefkowitz /s/ Robert Stewart Director March 25, 2025 Robert Stewart 45 CORMEDIX INC. AND SUBSIDIARIES FINANCIAL STATEMENTS Financial Statements Index Report of Independent Registered Public Accounting Firm (PCAOB ID # 688 ) F-2 Consolidated Balance Sheets as of December 31, 2024 and 2023 F-3 Consolidated Statements of Operations and Comprehensive Income (Loss) Years Ended December 31, 2024 and 2023 F-4 Consolidated Statements of Changes in Stockholders’ Equity Years Ended December 31, 2024 and 2023 F-5 Consolidated Statements of Cash Flows Years Ended December 31, 2024 and 2023 F-6 Notes to Consolidated Financial Statements F-7 F- 1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors of CorMedix Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of CorMedix Inc. (the “Company”) and Subsidiaries as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive income (loss), stockholders’ equity and cash flows for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the “financial statements”). In our opinion, based on our audits, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s 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 audits to obtain reasonable assurance about whether the 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 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 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 financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the 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 financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the 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. Variable Consideration: Product Returns Description of the Matter As discussed in Note 3 of the consolidated financial statements, the Company includes estimates of variable consideration in its transaction price at the time control of the product transfers to the customer. The variable consideration includes an estimate for future product returns. The Company permits returns for product that is within six months prior to or past the labeled expiration date. The Company’s product return accrual takes into consideration estimates of product held by its customers, the distribution channel, the shelf life of the product held by customers, as well as when the product is eligible for return based on the contractual terms. At December 31, 2024, the Company had $0.7 million in accrued returns allowance. Auditing the allowance for sales returns was complex due to the significant estimation required in determining product held by customers and in the distribution channel, as well as product that may not be sold to, or consumed by, the end user prior to the dates eligible for return under the contractual terms. The allowance for sales returns is sensitive to the level of product and turnover at the customer and in the distribution channel, which could exceed future end user demand and be subject to return. How We Addressed the Matter in Our Audit We obtained an understanding and evaluated the design of the Company's controls over the estimation for sales returns. In order to test the estimated sales return reserve, we performed audit procedures that included, among others, reviewing sell-through information of the Company’s major customers. We analyzed the estimated remaining inventory with selected customers and their distribution channel as compared to product sold to that customer and forecasted sales to, or usage by, the end users giving consideration to the remaining shelf life of the product. Further, for direct sales to outpatient dialysis centers, we reviewed the Company’s sales made to certain customers individual dialysis center locations by month during both the reporting period and through the financial statement issuance date to evidence follow on orders and utilization by those individual dialysis centers. We also performed direct management inquiries with Company sales and supply chain department personnel, and reviewed key customer contract terms and their alignment with such reserve assumptions. /s/ Marcum llp Marcum llp We have served as the Company’s auditor since 2014. Morristown, New Jersey March 25, 2025 F- 2 CorMedix Inc. And Subsidiaries CONSOLIDATED BALANCE SHEETS December 31, 2024 and 2023 December 31, 2024 2023 ASSETS Current assets Cash and cash equivalents $ 40,650,770 $ 43,642,684 Restricted cash - 77,453 Short-term investments 11,036,857 32,388,130 Trade receivables, net 51,653,583 - Inventories 7,599,535 2,106,345 Prepaid research and development expenses 152,823 353,574 Other prepaid expenses and current assets 3,481,868 882,214 Total current assets 114,575,436 79,450,400 Property and equipment, net 1,828,016 1,866,224 License intangible asset, net 1,844,156 - Restricted cash, long term 105,368 103,055 Operating lease right-of-use assets 492,697 640,278 TOTAL ASSETS $ 118,845,673 $ 82,059,957 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Accounts payable $ 1,720,177 $ 4,279,679 Accrued expenses 31,951,533 6,970,217 Operating lease liabilities, short-term 167,922 150,619 Total current liabilities 33,839,632 11,400,515 Operating lease liabilities, net of current portion 349,091 517,013 TOTAL LIABILITIES 34,188,723 11,917,528 COMMITMENTS AND CONTINGENCIES (Note 7) STOCKHOLDERS’ EQUITY Preferred stock - $ 0.001 par value: 2,000,000 shares authorized; 136,623 and 181,622 shares issued and outstanding at December 31, 2024 and 2023, respectively 137 182 Common stock - $ 0.001 par value: 160,000,000 shares authorized at December 31, 2024 and 2023; 64,411,295 and 54,938,258 shares issued and outstanding at December 31, 2024 and 2023, respectively 64,411 54,938 Accumulated other comprehensive gain 90,646 94,108 Additional paid-in capital 424,131,789 391,693,214 Accumulated deficit ( 339,630,033 ) ( 321,700,013 ) TOTAL STOCKHOLDERS’ EQUITY 84,656,950 70,142,429 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 118,845,673 $ 82,059,957 The accompanying notes are integral part of these consolidated financial statements. F- 3 CorMedix Inc. and Subsidiaries CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) Years Ended December 31, 2024 and 2023 December 31, 2024 2023 Revenue: Net sales $ 43,472,170 $ - Cost of sales ( 3,190,534 ) - Gross profit 40,281,636 - Operating Expenses: Research and development ( 3,942,270 ) ( 13,155,125 ) Selling and marketing ( 28,736,605 ) ( 18,115,313 ) General and administrative ( 29,959,150 ) ( 17,687,350 ) Total operating expenses ( 62,638,025 ) ( 48,957,788 ) Loss From Operations ( 22,356,389 ) ( 48,957,788 ) Other Income (Expense): Interest income 2,578,792 2,681,851 Foreign exchange transaction loss ( 30,788 ) ( 28,994 ) Other income 520,000 - Interest expense ( 36,405 ) ( 34,296 ) Total other income 3,031,599 2,618,561 Net Loss Before Income Taxes ( 19,324,790 ) ( 46,339,227 ) Tax benefit 1,394,770 - Net Loss ( 17,930,020 ) ( 46,339,227 ) Other Comprehensive Income (Loss): Unrealized (loss) gain from investments ( 4,830 ) 9,683 Foreign currency translation gain 1,368 1,682 Total other comprehensive gain (loss) ( 3,462 ) 11,365 Comprehensive Loss $ ( 17,933,482 ) $ ( 46,327,862 ) Net Loss Per Common Share – Basic and Diluted $ ( 0.30 ) $ ( 0.91 ) Weighted Average Common Shares Outstanding – Basic and Diluted 58,871,582 50,902,931 The accompanying notes are integral part of these consolidated financial statements. F- 4 CORMEDIX INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY Years Ended December 31, 2024 and 2023 Common Stock Preferred Stock – Series C-3, Series E, Series F and Series G Accumulated Other Comprehen-sive Additional Paid-in Accumulated Total Stockholders’ Shares Amount Shares Amount Gain (Loss) Capital Deficit Equity Balance at December 31, 2022 42,815,196 $ 42,815 181,622 $ 182 $ 82,743 $ 330,294,782 $ ( 275,360,786 ) $ 55,059,736 Stock issued in connection with ATM sale of common stock, net 2,977,637 2,978 - - - 12,946,132 - 12,949,110 Stock and pre-funded warrants issued in connection with public offering, net 9,000,093 9,000 - - - 42,869,399 - 42,878,399 Stock issued in connection with options exercised 79,041 79 - - - 287,659 - 287,738 Issuance of vested restricted stock, net of shares withheld for employee withholding taxes 66,291 66 - - - ( 198,509 ) - ( 198,443 ) Stock-based compensation - - - - - 5,493,751 - 5,493,751 Other comprehensive gain - - - - 11,365 - - 11,365 Net loss - - - - - - ( 46,339,227 ) ( 46,339,227 ) Balance at December 31, 2023 54,938,258 $ 54,938 181,622 $ 182 $ 94,108 $ 391,693,214 $ ( 321,700,013 ) $ 70,142,429 Stock issued in connection with ATM sale of common stock, net 3,049,878 3,050 - - - 18,878,537 - 18,881,587 Stock issued in connection with the exercise of pre-funded warrants 2,500,625 2,501 - - - - - 2,501 Stock issued in connection with options exercised 1,357,802 1,358 - - - 7,722,771 - 7,724,129 Conversion of Series G preferred stock to common stock 2,502,005 2,502 ( 44,999 ) ( 45 ) ( 2,457 ) - - Issuance of vested restricted stock, net of shares withheld for employee withholding taxes 84,559 84 - - - ( 289,706 ) - ( 289,622 ) Cancelation of shares held in escrow ( 21,832 ) ( 22 ) - - - 22 - - Stock-based compensation - - - - - 6,129,408 - 6,129,408 Other comprehensive loss - - - - ( 3,462 ) - - ( 3,462 ) Net loss - - - - - - ( 17,930,020 ) ( 17,930,020 ) Balance at December 31, 2024 64,411,295 $ 64,411 136,623 $ 137 $ 90,646 $ 424,131,789 $ ( 339,630,033 ) $ 84,656,950 The accompanying notes are integral part of these consolidated financial statements. F- 5 CORMEDIX INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended December 31, 2024 and 2023 December 31, 2024 2023 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ ( 17,930,020 ) $ ( 46,339,227 ) Adjustments to reconcile net loss to net cash used in operating activities: Provision for current expected credit losses 137,000 - Stock-based compensation 6,129,408 5,493,751 Change in right-of-use assets 147,581 134,807 Depreciation 153,937 70,755 Amortization of intangible 155,844 - Changes in operating assets and liabilities: Increase in trade receivables ( 51,790,583 ) - Increase in inventory ( 5,493,190 ) ( 2,106,345 ) Increase in prepaid expenses and other current assets ( 2,399,221 ) ( 600,983 ) (Decrease) Increase in accounts payable ( 2,559,491 ) 2,077,479 Increase in accrued expenses 22,984,701 2,995,084 Decrease in operating lease liabilities ( 150,619 ) ( 134,801 ) Net cash used in operating activities ( 50,614,653 ) ( 38,409,480 ) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of short-term investments ( 26,769,749 ) ( 77,084,385 ) Maturity of short-term investments 48,116,192 60,350,000 Purchase of equipment ( 115,730 ) ( 327,300 ) Net cash provided by (used in) investing activities 21,230,713 ( 17,061,685 ) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from sale of common stock from at-the-market program, net 18,881,587 12,949,110 Proceeds from public offering of common stock and pre-funded warrants, net - 42,878,399 Payment of employee withholding taxes on vested restricted stock units ( 289,622 ) ( 198,443 ) Proceeds from exercise of pre-funded warrants 2,501 - Proceeds from exercise of stock options 7,724,129 287,738 Net cash provided by financing activities 26,318,595 55,916,804 Foreign exchange effects on cash ( 1,709 ) 2,808 NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS ( 3,067,054 ) 448,447 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH – BEGINNING OF YEAR 43,823,192 43,374,745 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH – END OF YEAR $ 40,756,138 $ 43,823,192 Cash paid for interest $ 36,405 $ 34,296 Supplemental Disclosure of Non-Cash and Investing Activities: Liability related to license agreement $ 2,000,000 - Unrealized (loss) gain from investments $ ( 4,830 ) $ 9,683 The accompanying notes are integral part of these consolidated financial statements. F- 6 CORMEDIX INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1 — Organization and Description of Business: Organization and Business: CorMedix Inc. (collectively, with our wholly owned subsidiaries, referred to herein as “we,” “us,” “our” or the “Company”) is a biopharmaceutical company focused on developing and commercializing therapeutic products for life-threatening diseases and conditions. Our primary focus is commercializing our lead product, DefenCath® (taurolidine and heparin), in the U.S. The name DefenCath is the U.S. proprietary name approved by the U.S. Food and Drug Administration (“FDA”). CorMedix launched the product commercially in April 2024 in the inpatient setting and July 2024 in the outpatient hemodialysis setting. DefenCath is an FDA approved antimicrobial catheter lock solution (“CLS”) (a formulation of taurolidine 13.5 mg/mL, and heparin 1000 USP Units/mL) indicated to reduce the incidence of catheter-related bloodstream infections (“CRBSI”) in adult patients with kidney failure receiving chronic hemodialysis through a central venous catheter (“CVC”). It is indicated for use in a limited and specific population of patients. CRBSIs can lead to treatment delays and increased costs to the healthcare system when they occur due to hospitalizations, need for IV antibiotic treatment, long-term anticoagulation therapy, removal/replacement of the CVC, related treatment costs, as well as increased mortality. We believe DefenCath can address a significant unmet medical need. On November 15, 2023, we announced that the FDA approved the new drug application (“NDA”) for DefenCath to reduce the incidence of CRBSI in adult patients with kidney failure receiving chronic hemodialysis through a CVC. DefenCath is the first and only FDA-approved antimicrobial CLS in the U.S. and was shown to reduce the risk of CRBSI by up to 71 % in a Phase 3 clinical study. As a result of the November 2023 FDA approval, CorMedix launched the product commercially in April 2024 in the inpatient setting and July 2024 in the outpatient hemodialysis setting. Note 2 — Liquidity and Uncertainties: The consolidated financial statements have been prepared in conformity with generally accepted accounting principles which contemplate continuation of the Company as a going concern. To date, the Company’s commercial operations have not generated sufficient revenues to enable profitability. The Company’s current commercial and development expenses for DefenCath and its other operating requirements are expected to be funded for at least twelve months from the issuance of these financial statements by the Company’s existing cash, cash equivalents and short-term investments at December 31, 2024 as well as the additional expected liquidity from commercial operations. The Company’s operations are subject to a number of other factors that can affect its operating results and cash flow projections over the next twelve months from the issuance of these financial statements. Such factors include, but are not limited to: the ability to market DefenCath and generate necessary revenue in the time periods required; ability to manufacture successfully; competition from products manufactured and sold or being developed by other companies; the price of, and demand for, Company products; and the Company’s ability to negotiate favorable licensing or other manufacturing and marketing agreements for its products. As such, the Company may be required to raise additional capital through various potential sources, such as equity and/or debt financing, strategic relationships, potential strategic transactions and/or out-licensing. Management can provide no assurances that such financing or strategic relationships will be available on acceptable terms, or at all. As of December 31, 2024, approximately $ 30,216,000 of the Company’s common stock remains available for sale under the 2024 ATM program, with $ 100,000,000 of remaining capacity under the 2024 Shelf Registration Statement for the issuance of Company securities (see Note 8). F- 7 Note 3 — Summary of Significant Accounting Policies: Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The Company bases its estimates and judgments on historical experience and various other assumptions that it believes are reasonable under the circumstances. The amounts of assets and liabilities and disclosure of contingent assets and liabilities in the Company’s consolidated balance sheets and the reported amounts of revenue and expenses reported for each of the periods presented are affected by estimates and assumptions. The more significant areas in which estimates and the exercise of judgment relate include; variable consideration for product returns, realization of receivables, valuation of inventory, share-based payment grant date valuation, deferred tax asset valuation changes and contingent liability recognition and disclosures. Estimates are based on historical experience and other assumptions that are considered appropriate in the circumstances. They are continuously reviewed but may vary from the actual values. Reclassifications Certain reclassifications were made to the prior year’s amounts to conform to the 2024 presentation. Basis of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Trade Accounts Receivable and Allowances The Company recognizes an allowance that reflects a current estimate of credit losses expected to be incurred over the life of a financial asset, including trade receivables. The allowance for credit losses reflects the best estimate of expected credit losses of the accounts receivable portfolio determined on the basis of current information, forecasts of future economic conditions, industry knowledge and to some extent our historical experience. The Company determines its allowance methodology by pooling receivable balances at the customer level. The Company considers various factors, including individual credit risk associated with each customer, the current and future condition of the general economy and industry knowledge. These credit risk factors are monitored on a quarterly basis and updated as necessary. To the extent any individual debtor is identified whose credit quality has deteriorated, the Company establishes allowances based on the individual risk characteristics of such customer. The Company makes concerted efforts to collect all outstanding balances due, however account balances are charged off against the allowance when management believes it is probable the receivable will not be recovered. The Company does not have any off-balance sheet credit exposure related to its customers. Allowances recorded for credit losses as of December 31, 2024 were approximately $ 0.1 million, there were no write-offs or recoveries during the year ended December, 31, 2024. Concentrations The major customers of the Company are defined as those constituting greater than 10% of its total revenue. For the year ended December 31, 2024, the Company had sales to one customer that accounted for 86 % of its total revenue of $ 43,472,000 . For the year ended December 31, 2024, the Company had two customers that accounted for 87 % and 12 % of the accounts receivable, respectively. The Company currently has one FDA approved source for each of our two key active pharmaceutical ingredients (“APIs”) for DefenCath, taurolidine and heparin sodium, respectively. With regards to taurolidine, the Company has a drug master file (“DMF”) filed with the FDA. There is a master commercial supply agreement between a third-party manufacturer which has been in place since August 2018. In addition, the Company is working with its existing manufacture to source sufficient quantities of taurolidine API to cover at least 24 months of potential future demand. With respect to heparin sodium API, the Company has identified an alternate third-party supplier and may qualify such supplier under the DefenCath NDA over the next twelve months. The Company received FDA approval of DefenCath with finished dosage production from its European based contract manufacturing organization (“CMO”) Rovi Pharma Industrial Services. The Company believes this CMO has adequate capacity to produce the volumes needed to meet near-term projected demand for the commercial launch of DefenCath. The Company also qualified Siegfried Hameln as an alternate finished dosage manufacturing site. F- 8 Financial Instruments Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents, short-term investments and accounts receivable. The Company maintains its cash and cash equivalents in bank deposit and other interest-bearing accounts, the balances of which, , may exceed federally insured limits. The following table is the reconciliation of the accounting standard that modifies certain aspects of the recognition, measurement, presentation and disclosure of financial instruments as shown on the Company’s consolidated statement of cash flows: December 31, 2024 2023 Cash and cash equivalents $ 40,650,770 $ 43,642,684 Restricted cash, short-term and long-term 105,368 180,508 Total cash, cash equivalents and restricted cash $ 40,756,138 $ 43,823,192 The appropriate classification of marketable securities is determined at the time of purchase and reevaluated as of each balance sheet date. Investments in marketable debt, classified as available-for-sale, are reported at fair value. Fair value is determined using quoted market prices in active markets for identical assets or liabilities or quoted prices for similar assets or liabilities or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Changes in fair value that are considered temporary are reported in other comprehensive income. Realized gains and losses, amortization of premiums and discounts and interest and dividends earned are included in other income (expense). The Company considers available evidence in evaluating potential impairments of its investments, including the duration and extent to which fair value is less than cost. There were no deemed permanent impairments at December 31, 2024 or December 31, 2023. The Company’s marketable securities are highly liquid and consist of U.S. government agency securities, high-grade corporate obligations and commercial paper with original maturities of more than 90 days. As of December 31, 2024 and 2023, all of the Company’s investments had contractual maturities which were less than one year. The following table summarizes the amortized cost, unrealized gains and losses and the fair value at December 31, 2024 and 2023: Amortized Cost Gross Unrealized Losses Gross Unrealized Gains Fair Value December 31, 2024: Money Market Funds and Cash Equivalents $ 23,121,752 $ - $ - $ 23,121,752 U.S. Government Agency Securities 11,032,606 - 4,251 11,036,857 Total December 31, 2024 $ 34,154,358 $ - $ 4,251 $ 34,158,609 December 31, 2023: Money Market Funds and Cash Equivalents $ 32,541,862 $ - $ - $ 32,541,862 U.S. Government Agency Securities 29,701,677 - 10,506 29,712,183 Commercial Paper 2,676,740 ( 1,425 ) - 2,675,315 Subtotal 32,378,417 ( 1,425 ) 10,506 32,387,498 Total December 31, 2023 $ 64,920,279 $ ( 1,425 ) $ 10,506 $ 64,929,360 F- 9 Fair Value Measurements In accordance with Accounting Standards Codification (“ASC”) 825, Financial Instruments, disclosures of fair value information about financial instruments is required, whether or not recognized in the consolidated balance sheet, for which it is practicable to estimate that value. The Company’s financial instruments recorded in the consolidated balance sheets include cash and cash equivalents, accounts receivable, investment securities and accounts payable. The carrying value of certain financial instruments, primarily cash and cash equivalents, accounts receivable and accounts payable approximate their estimated fair values based upon the short-term nature of their maturity dates. The Company categorizes its financial instruments into a three-level fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument. Financial assets recorded at fair value on the Company’s consolidated balance sheets are categorized as follows: Level 1 inputs—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 inputs— Significant other observable inputs (e.g., quoted prices for similar items in active markets, quoted prices for identical or similar items in markets that are not active, inputs other than quoted prices that are observable such as interest rate and yield curves, and market-corroborated inputs). Level 3 inputs—Unobservable inputs for the asset or liability, which are supported by little or no market activity and are valued based on management’s estimates of assumptions that market participants would use in pricing the asset or liability. The following table provides the carrying value and fair value of the Company’s financial assets measured at fair value as of December 31, 2024 and 2023: Carrying Value Level 1 Level 2 Level 3 December 31, 2024: Money Market Funds and Cash Equivalents $ 23,121,752 $ 23,151,752 $ - $ - U.S. Government Agency Securities 11,036,857 11,036,857 - - Total December 31, 2024 $ 34,158,609 $ 34,158,609 $ - $ - December 31, 2023: Money Market Funds and Cash Equivalents $ 32,541,862 $ 32,541,862 $ - $ - U.S. Government Agency Securities 29,712,183 29,712,183 - - Commercial Paper 2,675,315 - 2,675,315 - Subtotal 32,387,498 29,712,183 2,675,315 - Total December 31, 2023 $ 64,929,360 $ 62,254,045 $ 2,675,315 $ - Foreign Currency Translation and Transactions The consolidated financial statements are presented in U.S. Dollars (USD), the reporting currency of the Company. For the financial statements of the Company’s foreign subsidiaries, whose functional currency is the EURO, foreign currency asset and liability amounts, if any, are translated into USD at end-of-period exchange rates. Foreign currency income and expenses are translated at average exchange rates in effect during the year. Translation gains and losses are included in other comprehensive income (loss). The Company had a foreign currency translation gain of $ 1,368 and $ 1,682 for the years ended December 31, 2024 and 2023, respectively. Foreign currency exchange transaction gain (loss) is the result of re-measuring transactions denominated in a currency other than the functional currency of the entity recording the transaction. F- 10 Restricted Cash The Company was required by the District Courts of Mannheim to provide security deposit to cover legal fees in the event TauroPharm is entitled to reimbursement of these costs. The Company furthermore had to provide a deposit for the first and second instances, respectively, in connection with the unfair competition proceedings in Cologne. As of December 31, 2023, the Company had restricted cash in connection with the patent and utility model infringement proceedings against TauroPharm in the amount of approximately $ 77,000 , which was refunded to the Company during the year ended December 31, 2024. As of December 31, 2024 and 2023, the Company had $ 105,000 and $ 103,000 , respectively in long-term restricted cash for a lease security deposit. Prepaid Research and Development and Other Prepaid Expenses Prepaid expenses consist of payments made in advance to vendors relating to service contracts for clinical trial development, manufacturing, pre-clinical development and insurance policies. These advanced payments are amortized to expense either as services are performed or over the relevant service period using the straight-line method. Inventories The Company engages third parties to manufacture and package inventory held for sale and warehouse such goods until packaged for final distribution and sale. Costs related to the manufacturing of DefenCath incurred prior to FDA approval to support the preparation for commercial launch of its product were expensed as research and development expenses (R&D) as incurred. Upon FDA approval, costs related to the manufacturing of inventory are stated at the lower of cost or net realizable value with cost determined on a first-in, first-out basis. Inventory is valued utilizing the standard cost method, which approximates costs determined on the first-in first-out basis. The Company regularly reviews inventory quantities on hand and writes down to its net realizable value any inventory that it believes to be impaired. Management considers forecast demand in relation to the inventory on hand, competitiveness of product offering and sales volume assumptions, market conditions and product life cycle and expiration dating when determining net realizable value adjustments. Once inventory is written down and a new cost basis is established, it is not written back up if demand increases. The Company has not experienced any write-downs for any items listed above during 2023 or 2024. Inventories consist of raw materials (including labeling and packaging), work-in-process, and finished goods, if any, for the DefenCath product. Inventories consist of the following: December 31, 2024 2023 Raw materials $ 1,111,409 $ 1,525,420 Work in progress 3,528,401 580,925 Finished goods 2,959,725 - Total $ 7,599,535 $ 2,106,345 The pre-commercial inventory previously expensed as R&D prior to FDA approval, consists of certain raw materials and inventory at various stages of completion with a value approximating $ 5,318,000 as of December 31, 2024. F- 11 Property and Equipment Property and equipment consist primarily of furnishings, fixtures, leasehold improvements, office equipment and computer equipment, all of which are recorded at cost. Depreciation is provided for by the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized using the straight-line method over the remaining lease term or the life of the asset, whichever is shorter. Property and equipment, as of December 31, 2024 and 2023 were approximately $ 1,828,000 and $ 1,866,000 , respectively, net of accumulated depreciation of approximately $ 674,000 and $ 521,000 , respectively. Depreciation and amortization of property and equipment is included in cost of goods sold and general and administrative expenses. Description Estimated Useful Life Income Statement Classification Office equipment and furniture 5 years G&A Leasehold improvements 7 years or remaining term of the lease G&A Computer equipment 3 years G&A Computer software 3 years G&A Packaging equipment 5 years COGS Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current portion of operating lease liabilities and operating lease liabilities, net of current portion, on the consolidated balance sheet (see Note 9). Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company has elected, as an accounting policy, not to apply the recognition requirements in ASC 842, Accounting for Leases , to short-term leases. Short-term leases are leases that have a term of 12 months or less and do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise. The Company recognizes the lease payments for short-term leases on a straight-line basis over the lease term. The Company has also elected, as a practical expedient, by underlying class of asset, not to separate lease components from non-lease components and, instead, account for them as a single component. Revenue Recognition The Company recognizes revenue from the sale of its product, DefenCath, in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”). The provisions of ASC 606 require the following steps to determine revenue recognition: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes revenue when it believes that it is probable that it will collect the consideration to which it is entitled in exchange for the goods or services that will be transferred to the customer. The Company’s product revenue is recognized at a point in time when the performance obligation is satisfied by transferring control of the promised goods or services to a customer. In accordance with the Company’s contracts with customers, control of the product is transferred upon the conveyance of title, which occurs when the product is received by a customer. The Company’s customers are located in the United States and consist primarily of outpatient service providers and wholesale distributors. F- 12 Variable Consideration The Company includes an estimate of variable consideration in its transaction price at the time of sale when control of the product transfers to the customer. Variable consideration includes: ● Distribution service fees; ● Prompt pay and other discounts; ● Product returns; ● Chargebacks; ● Rebates; ● Volume incentive rebates; The Company assesses whether or not an estimate of variable consideration is constrained based on the probability that a significant reversal in the amount of cumulative revenue may occur in the future when the uncertainty associated with the variable consideration is subsequently resolved. Actual amounts of consideration ultimately received may vary from our estimates. If actual results in the future vary from estimates, the Company adjusts these estimates, which would affect product sales and earnings in the period such variances become known. The specific considerations that the Company uses in estimating these amounts related to variable considerations are as follows: Distribution services fees – The Company pays distribution service fees primarily to its wholesale distributors. The Company reserves these fees based on actual net sales and the contractual fee rates negotiated with the customers in the distribution channel. The Company records these fees as contra accounts receivable on the balance sheet. Prompt pay and other discounts – The Company provides customers with prompt pay discounts. The specific prompt pay terms vary by customer and are contractually fixed. Prompt pay discounts are expected to be taken by the Company’s customers, so an estimate of the discount is recorded at the time of sale based on the invoice price. Prompt pay discount estimates are recorded as contra accounts receivable on the balance sheet. Product returns – Customers have the right to return product that is within six months or less of the labeled expiration date or that is past the expiration date by no more than six months. The Company determines its estimate for product returns based on: (i) data provided to the Company by its distributors (including weekly reporting of distributors’ sales and inventory held by distributors that provided the Company with visibility into the distribution channel in order to determine what quantities were sold to both inpatient and outpatient facilities), and (ii) the estimated remaining shelf life of DefenCath held by the wholesale distributors and outpatient service providers. Since the returns primarily consist of expired and short dated products that will not be resold, the Company does not record a return asset for the right to recover the goods returned by the customer at the time of the initial sale (when recognition of revenue is deferred due to the anticipated return). Estimated product returns are recorded as accrued expenses on the balance sheet. Chargebacks – Certain covered entities, group purchasing organizations (“GPO”) and government entities will be able to purchase the product at a price discounted below wholesaler acquisition cost (“WAC”). The difference between the GPO, government or covered entity purchase price and the wholesale distributor purchase price of WAC will be charged back to the Company. The Company estimates the amount in chargebacks based on the expected number of claims and related cost that is associated with the revenue being recognized for product that remains in the distribution channel at the end of each reporting period. Estimated chargebacks are recorded as contra accounts receivable on the balance sheet. F- 13 Rebates – The Company is or may become subject to negotiated discount obligations to different GPO, direct purchasers, other commercial organizations or government programs. The rebate amounts for these programs are determined by statutory requirements or contractual arrangements. Rebates are owed after the product has been dispensed to an end user and the Company has been invoiced. Rebates are typically invoiced in arrears. The Company’s liability for these rebates consists of invoices received for claims from prior quarters that have not been paid or for which an invoice has not yet been received, estimates of claims for the current quarter based on expected product utilization, and estimated future claims that will be made for product that has been recognized as revenue, but remains in the distribution channel at the end of each reporting period. Rebate estimates are recorded as accrued expenses on the balance sheet. Volume Incentive Rebates – The Company is subject to negotiated volume incentive rebates with certain direct and indirect customers (primarily outpatient service providers). Rebates are owed based on predetermined volume levels and payable per the terms in the customer contracts. The Company estimates and records volume incentive rebates based on anticipated purchase volume with specific customers based on communications with the customer. Volume incentive rebates are recorded as accrued expenses on the balance sheet. Provisions for the revenue reserves described above totaled $ 24,128,000 for the year ended December 31, 2024. As of December 31, 2024, total accrued reserves and allowances to accounts receivable on the balance sheet associated with variable consideration were $ 23,161,000 . A roll forward of the major categories of variable consideration deductions for the years ended December 31, 2024 and 2023 is as follows: Volume Incentive Rebates Prompt Pay and Other Discounts Accrued Returns Allowance Balance at December 31, 2023 $ - $ - $ - Provisions related to sales recorded in the period 21,582,371 1,202,526 746,310 Credits/payments issued during the period ( 664,380 ) ( 267,240 ) - Balance at December 31, 2024 $ 20,917,991 $ 935,286 $ 746,310 License Agreement The Company’s rights under the License and Assignment Agreement with ND Partners, LLP are capitalized and stated at cost. The Company amortizes the intangible asset utilizing the straight-line method over the estimated economic life of the intangible asset based on the Company’s assessment of various factors impacting estimated useful lives and cash flows of the acquired rights. Such factors include the launch date of DefenCath, the strength of the intellectual property protection of DefenCath and associated technology and various other competitive, developmental and regulatory considerations, and contractual terms. See Note 7 – Commitments and Contingencies for further discussion. Loss Per Common Share Basic loss per common share excludes dilution and is computed by dividing net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company. The Company’s outstanding shares of Series E preferred stock entitle the holders to receive dividends on a basis equivalent to the dividends paid to holders of common stock. As a result, the Series E preferred stock meet the definition of participating securities requiring the application of the two-class method. Under the two-class method, earnings available to common shareholders, including both distributed and undistributed earnings, are allocated to each class of common stock and participating securities according to dividends declared and participating rights in undistributed earnings, which may cause diluted earnings per share to be more dilutive than the calculation using the treasury stock method. No loss has been allocated to these participating securities since they do not have contractual obligations that require participation in the Company’s losses. F- 14 Since the Company has only incurred losses, potentially dilutive securities are excluded from the calculation of diluted net loss per share because their effect would be anti-dilutive, and therefore basic and diluted loss per share are the same for all periods presented. The shares outstanding at the end of the respective periods presented below were excluded from the calculation of diluted net loss per share due to their anti-dilutive effect: Number of Shares of Common Stock Issuable At December 31, 2024 2023 Series C non-voting preferred stock 4,000 4,000 Series E voting preferred stock 391,953 391,953 Series G voting preferred stock 2,502,064 5,004,069 Shares issuable for payment of deferred board compensation 48,909 48,909 Shares underlying outstanding stock options 6,282,393 6,211,508 Restricted stock units 291,494 153,735 Total potentially dilutive shares 9,520,813 11,814,174 Stock-Based Compensation Stock-based compensation cost is measured at grant date, based on the estimated fair value of the award using the Black-Scholes option pricing model for options with service or performance-based conditions. Stock-based compensation is recognized as expense over the requisite service period on a straight-line basis or when the achievement of the performance condition is probable. Research and Development Research and development costs are charged to expense as incurred. Research and development include fees associated with operational consultants, contract clinical research organizations, contract manufacturing organizations, clinical site fees, contract laboratory research organizations, contract central testing laboratories, licensing activities, and allocated executive, human resources and facilities expenses. The Company accrues for costs incurred as the services are being provided by monitoring the status of the trial and the invoices received from its external service providers. As actual costs become known, the Company adjusts its accruals in the period when actual costs become known. Costs related to the acquisition of technology rights and patents for which development work is still in process are charged to operations as incurred and considered a component of research and development expense. Other Income Other income relates to a settlement with a previously utilized vendor, occurring during the year ended December 31, 2024. Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. 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. 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. Valuation allowances are established when it is more likely than not that some or all of the deferred tax assets will not be realized. F- 15 Recent Authoritative Pronouncements, not yet adopted From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that the Company adopts as of the specified effective date. Unless otherwise discussed below, the Company does not believe the adoption of recently issued standards have or may have a material impact on its consolidated financial statements or disclosures. ASU No. 2023-09 In December 2023, the FASB issued Accounting Standards Update (ASU) No. 2023-09, Income Taxes - Improvements to Income Tax Disclosures (Topic 740). The standard requires disaggregation of the effective rate reconciliation into standard categories, enhances disclosure of income taxes paid, and modifies other income tax-related disclosures. The standard will be effective for CorMedix beginning in annual reporting period ending December 31, 2025, with early adoption permitted. CorMedix is currently assessing the impact of adopting this guidance on its consolidated financial statements. ASU 2024-03 In November 2024, the FASB issued ASU 2024-03, ASC 220- Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures , which requires entities, in the notes to financial statements, with specified information about certain costs and expenses. The guidance is effective for CorMedix’s annual reporting period ending December 31, 2027, with interim periods beginning with CorMedix’s interim period ended March 31, 2027. Early adoption is permitted. CorMedix is assessing the impact of adopting this guidance on its consolidated financial statements. Recently Adopted Authoritative Pronouncements: ASU No. 2023-07 In November 2023, the FASB issued ASU No. 2023-07 Segment Reporting - Improving Reportable Segment Disclosures (Topic 280). The standard requires disclosures to include significant segment expenses that are regularly provided to the chief operating decision maker (CODM), a description of other segment items by reportable segment, and any additional measures of a segment’s profit or loss used by the CODM when deciding how to allocate resources. The ASU also requires all annual disclosures currently required by Topic 280 to be included in interim periods. CorMedix adopted this guidance as of December 31, 2024. See Note 10 for the disclosure related to the adoption of ASU No. 2023-07. Note 4 – Other Prepaid Expenses and Current Assets: Other Prepaid Expenses and Current Assets Other prepaid expenses and current assets consist of the following: December 31, 2024 December 31, 2023 Prepaid API $ 1,039,494 $ - Commercial 666,288 171,393 FDA filing fee 449,558 - Medical affairs 412,118 - Subscriptions 409,774 466,114 Insurance 342,172 126,616 Clinical 70,564 - Other 91,900 118,091 Total $ 3,481,868 $ 882,214 F- 16 Note 5 — Accrued Expenses: Accrued Expenses Accrued expenses consist of the following: December 31, 2024 2023 Accrued gross-to-net-deductions $ 21,860,335 $ - Accrued payroll and payroll taxes 6,530,469 2,718,770 License agreement payable 2,000,000 - Professional and consulting fees 865,413 2,270,022 Manufacturing related 572,959 1,835,101 Other 122,357 146,324 Total $ 31,951,533 $ 6,970,217 Note 6 — Income Taxes: The Company’s U.S. and foreign loss before income taxes are set forth below: December 31, 2024 2023 United States $ ( 19,065,449 ) $ ( 45,946,020 ) Foreign ( 259,341 ) ( 393,207 ) Total $ ( 19,324,790 ) $ ( 46,339,227 ) There were no current or deferred income tax provision for the years ended December 31, 2024 and 2023 because the Company has incurred operating losses since inception. The Company’s deferred tax assets consist of the following: December 31, 2024 2023 Net operating loss carryforwards – Federal $ 55,778,000 $ 53,614,000 Net operating loss carryforwards – State 2,820,000 4,603,000 Net operating loss carryforwards – Foreign 10,000 6,000 Capitalized licensing fees 86,000 165,000 Stock-based compensation 2,976,000 6,151,000 Accrued compensation 1,601,000 720,000 Section 174 capitalization 5,159,000 5,522,000 Other 738,000 ( 4,000 ) Totals 69,168,000 70,777,000 Less valuation allowance ( 69,168,000 ) ( 70,777,000 ) Deferred tax assets $ - $ - A valuation allowance is provided when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The net change in the total valuation allowance for the year ended December 31, 2024 was $ 1,609,000 . F- 17 The Company had the following potentially utilizable net operating loss tax carryforwards: December 31, 2024 2023 Federal $ 265,610,000 $ 255,306,000 State $ 41,090,000 $ 64,738,000 Foreign $ 38,000 $ 25,000 Approximately $ 113,600,000 of net operating losses generated will expire in 2026 through 2037 for Federal purposes whereas the operating losses for state purposes will expire between 2043 and 2044. The Tax Cuts and Jobs Act of 2017 (the “Act”) limits the net operating loss deduction to 80 % of taxable income for losses arising in tax years beginning after December 31, 2017. However, the net operating losses now have an indefinite carryforward as opposed to the former 20-year carryforward. The foreign net operating loss tax carryforwards do not expire. Our federal and state operating loss carryforwards include windfall tax deductions from stock option exercises. The Company’s foreign earnings, if any, are derived from its German and Spanish subsidiaries. The Company does not expect any foreign earnings to be repatriated in the U.S. in the near future. The winding down of its operations in the EU is ongoing and there was no income during the year ended December 31, 2024. The Company’s effective tax rate varied from the statutory rate as follows: December 31, 2024 2023 Statutory federal tax rate 21.0 % 21.0 % State income tax rate (net of federal) ( 11.3 )% 8.7 % Change in foreign NOL ( 0.3 )% ( 0.2 )% Stock compensation prior year true-up ( 6.8 )% - Stock compensation ( 7.6 )% - Sale of NJ NOL 7.2 % 0.0 % Deferred only adjustment ( 0.1 )% 0.0 % Other permanent differences ( 2.7 )% ( 1.4 )% Effect of valuation allowance 7.8 % ( 28.1 )% Effective tax rate 7.2 % 0.0 % In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income of the appropriate character during the periods in which those temporary differences become deductible and the loss carryforwards are available to reduce taxable income. In making its assessment, the Company considered all sources of taxable income including carryback potential, future reversals of existing deferred tax liabilities, prudent and feasible tax planning strategies, and lastly, objectively verifiable projections of future taxable income exclusive of reversing temporary differences and carryforwards. At December 31, 2024 and 2023, the Company maintained a full valuation allowance against its net deferred tax assets. The Company will continue to assess all available evidence during future periods to evaluate the realization of its deferred tax assets. The following table presents the changes in the deferred tax asset valuation allowance for the periods indicated: Year Ended Balance at Beginning of Year Increase (Decrease) Charged (Credited) to Income Taxes (Benefit) Increase (Decrease) Charged (Credited) to OCI Balance at End of Year December 31, 2024 $ 70,777,000 $ ( 1,574,000 ) $ ( 35,000 ) $ 69,168,000 December 31, 2023 $ 57,761,000 $ 13,050,000 $ ( 34,000 ) $ 70,777,000 Accounting for uncertainty in income taxes requires uncertain tax positions to be classified as non-current income tax liabilities unless they are expected to be paid within one year. The Company has concluded that there are no uncertain tax positions requiring recognition in its consolidated financial statements as of December 31, 2024 and 2023. The Company recognizes interest and penalties related to uncertain tax positions if any as a component of income tax expense. F- 18 The Company files U.S. federal and state returns. The Company’s foreign subsidiary also files a local tax return in their local jurisdiction. From a U.S. federal, state and local perspective the years that remain open to examination are consistent with each jurisdiction’s statute of limitations. During the year ended December 31, 2024, the Company received approximately $ 1,395,000 , net of expenses, from the sale of its unused New Jersey net operating losses (NOL), that was eligible for sale under the State of New Jersey’s Economic Development Authority’s New Jersey Technology Business Tax Certificate Transfer program (NJEDA Program). The NJEDA Program allowed the Company to sell its available NOL tax benefits for the state fiscal year 2023 in the amount of approximately $ 1,500,000 . During the year ended December 31, 2023 the Company did not sell any of its unused NOL. Note 7 — Commitments and Contingencies: Contingency Matters In re CorMedix Inc. Securities Litigation, Case No. 2:21-cv-14020 (D.N.J.) On October 13, 2021, the United States District Court for the District of New Jersey consolidated into In re CorMedix Inc. Securities Litigation, Case No. 2:21-cv 14020-JXN-CLW, two putative class action lawsuits filed on or about July 22, 2021 and September 13, 2021, respectively, and appointed lead counsel and lead plaintiff, a purported stockholder of the Company. The lead plaintiff filed a consolidated amended class action complaint on December 14, 2021, alleging violations of Sections 10(b) and 20(a) of the Exchange Act, along with Rule 10b-5 promulgated thereunder, and Sections 11 and 15 of the Securities Act of 1933. On October 10, 2022, the lead plaintiff filed a second amended consolidated complaint that superseded the original complaints in In re CorMedix Securities Litigation. On March 21, 2024, the court denied Defendant’s motion to dismiss without prejudice and granted lead plaintiff leave to amend the complaint. On April 22, 2024, lead plaintiff filed a third amended consolidated complaint that superseded the second amended consolidated complaint. In the third amended complaint, the lead plaintiff seeks to represent a class of shareholders who purchased or otherwise acquired CorMedix securities between October 16, 2019 and August 8, 2022, inclusive. The third amended complaint names as defendants the Company and six (6) current and former officers of CorMedix, namely Khoso Baluch, Robert Cook, Matthew David, Phoebe Mounts, John L. Armstrong, and Joseph Todisco (the “Officer Defendants” and collectively with CorMedix, the “CorMedix Defendants”). The third amended complaint alleges that the CorMedix Defendants violated Section 10(b) of the Exchange Act (and Rule 10b-5) and that the Officer Defendants violated Section 20(a). In general, the purported bases for these claims are allegedly false and misleading statements and omissions related to the NDA submissions to the FDA for DefenCath, subsequent complete response letters, as well as communications from the FDA related and directed to the Company’s contract manufacturing organization and heparin supplier. The Company intends to vigorously contest such claims. The Company filed its motion to dismiss the third amended complaint on June 6, 2024, and received from Plaintiffs their opposition to the Company’s motion to dismiss on July 22, 2024. The Company filed its response on August 21, 2024. In re CorMedix Inc. Derivative Litigation, Case No. 2:21-cv-18493-JXN-LDW (D.N.J.) On or about October 13, 2021, a purported shareholder, derivatively and on behalf of the Company, filed a shareholder derivative complaint in the United States District Court for the District of New Jersey, in a case entitled Voter v. Baluch, et al., Case No. 2:21-cv-18493-JXN-LDW (the “Derivative Litigation”). The complaint names as defendants Khoso Baluch, Janet Dillione, Alan W. Dunton, Myron Kaplan, Steven Lefkowitz, Paulo F. Costa, Greg Duncan, Matthew David, Phoebe Mounts and Joseph Todisco along with the Company as Nominal Defendant. The complaint alleges breaches of fiduciary duties, abuse of control, and waste of corporate assets against the defendants and a claim for contribution for purported violations of Sections 10(b) and 21D of the Exchange Act against certain defendants. The individual defendants intend to vigorously contest such claims. On January 21, 2022, pursuant to a stipulation between the parties, the Court entered an order staying the case while the motion to dismiss the class action lawsuit described in the foregoing paragraph is pending. The stay may be terminated before the motion to dismiss is resolved according to certain circumstances described in the stipulation available on the Court’s public docket. F- 19 On or about January 13, 2023, another purported shareholder, derivatively and on behalf of the Company, filed a shareholder derivative complaint in the United States District Court for the District of New Jersey, in a case entitled DeSalvo v. Costa, et al. , Case No. 2:23-cv-00150-JXN-CLW. Defendants Paulo F. Costa, Janet D. Dillione, Greg Duncan, Alan Dunton, Myron Kaplan, Steven Lefkowitz, Joseph Todisco, Khoso Baluch, Robert Cook, Matthew David, Phoebe Mounts, and John L. Armstrong along with the Company as Nominal Defendant. The complaint alleges breaches of fiduciary duty and unjust enrichment against the individual defendants. On or about January 25, 2023, another purported shareholder, derivatively and on behalf of the Company, filed a shareholder derivative complaint in the United States District Court for the District of New Jersey, in a case entitled Scullion v. Baluch, et al. , Case No. 2:23-cv-00406-ES-ESK. Defendants Khoso Baluch, Janet Dillione, Alan W. Dunton, Myron Kaplan, Steven Lefkowitz, Paulo F. Costa, Gregory Duncan, Matthew David, and Phoebe Mounts, along with the Company as Nominal Defendant. The complaint alleges breaches of fiduciary duties. On or about April 18, 2023, the Court entered an order consolidating the above-mentioned shareholder derivative complaints for all purposes, including pretrial proceedings, trial and appeal. The consolidated derivative action is entitled, In re CorMedix Inc. Derivative Litigation , C.A. No. 2:21-cv-18493-JXN-LDW. The individual defendants intend to vigorously contest the claims set forth in the consolidated derivative action. The provisions of the Order to Stay entered in the Voter Action on January 21, 2022, apply to the consolidated derivative action. On April 20, 2023, the consolidated derivative action was administratively terminated and removed from the Court’s docket until the motion to dismiss the class action is resolved and the Private Securities Litigation Reform Act, or PSLRA, stay is lifted. On April 22, 2024, the lead plaintiff in the class action filed a third amended complaint. The class action remains stayed under the PSLRA. Demand Letter On or about June 23, 2022, the Company’s Board received a letter demanding it investigate and pursue causes of action, purportedly on behalf of the Company, against certain current and former directors, officers, and/or other employees of the Company (the “Letter”), which the Board believes are duplicative of the claims already asserted in the Derivative Litigation. As set forth in the Board’s response to the Letter, the Board will consider the Letter at an appropriate time, as circumstances warrant, as it continues to monitor the progress of the Derivative Litigation. Commitments License and Assignment Agreement In 2008, the Company entered into a License and Assignment Agreement (the ND License Agreement) with ND Partners, LLP (NDP). Pursuant to the ND License Agreement, NDP granted the Company exclusive, worldwide licenses for certain antimicrobial catheter lock solutions, processes for treating and inhibiting infections, a biocidal lock system and a taurolidine delivery apparatus, and the corresponding United States and foreign patents and applications (the NDP Technology). As consideration in part for the rights to the NDP Technology, upon execution of the ND License Agreement, the Company paid NDP an initial licensing fee of $ 325,000 and granted NDP a 5 % equity interest in the Company, consisting of 7,996 shares of the Company’s common stock. Under the ND License Agreement, the Company is required to make cash and equity payments to NDP upon the achievement of certain milestones. In 2014, a certain milestone was achieved resulting in the release of 7,277 shares held in escrow. As of December 31, 2022, the shares remaining in escrow were cancelled in accordance with the terms of the escrow agreement. Under the ND License Agreement, the maximum aggregate amount of cash payments due upon achievement of applicable milestones was $ 2,500,000 , with the balance being $ 2,000,000 as of December 31, 2024 and 2023. The initial licensing fee of $ 325,000 , the fair value of the 5 % equity interest ( 7,996 shares of the Company’s common stock) and an additional $ 500,000 , as a result of the achievement of one milestone, were recognized on the Company’s statement of operations in R&D in prior periods, as the related milestones were achieved by the Company prior to the FDA approval. During the year ended December 31, 2024, the Company determined it was probable that the net sales milestones would be achieved in future periods and, as a result, the Company recorded a license intangible asset of $ 2,000,000 and a license agreement liability of $ 2,000,000 , which is included within accrued expenses in the Company’s consolidated balance sheet as of December 31, 2024. These sales milestones were met during the year ended December 31, 2024. The Company anticipates payment will be due in accordance with the agreement terms at the end of the twelve month period post attainment. F- 20 Beginning in the second quarter of 2024, the license intangible asset is amortized as cost of goods sold over its estimated economic life of approximately 10 years. The amortization start period correlates with the product launch of DefenCath and the first period in which revenue will be recognized. Amortization expense of approximately $ 156,000 was recorded during the year ended December 31, 2024. The ND License Agreement will expire on a country-by-country basis upon the earlier of (i) the expiration of the last patent claim under the ND License Agreement in a given country, or (ii) the payment of all milestone payments. Upon the expiration of the ND License Agreement in each country, we will have an irrevocable, perpetual, fully paid-up, royalty-free exclusive license to the NDP Technology in such country. The ND License Agreement also may be terminated by NDP if the Company materially breaches or defaults under the ND License Agreement and that breach is not cured within 60 days following the delivery of written notice to the Company, or by the Company on a country-by-country basis upon 60 days prior written notice in the event the Company’s Board determines not to proceed with the development of the NDP Technology. If the ND License Agreement is terminated by either party, the Company’s rights to the NDP Technology will revert back to NDP. Other In December 2024, the Company entered into a project agreement with Syneos Health Commercial Services, LLC (“Syneos”) where Syneos will provide a field force of sales representatives to provide certain sales operations services, compliance services and training services with respect to DefenCath to us in exchange for an up-front implementation fee and a fixed monthly fee. The term of the agreement is 3 years and is cancelable provided 60 days written notice, upon the twelve-month anniversary of the deployment date, which has yet to be determined as of the filing of this Form 10-K. As of December 31, 2024, the minimum amount committed totals $ 9.6 million. The Company entered into a seven-year operating lease agreement in March 2020 for an office space at 300 Connell Drive, Berkeley Heights, New Jersey 07922. The lease agreement, with a monthly average cost of approximately $ 17,000 , commenced on September 16, 2020. Note 8 — Stockholders’ Equity: Common Stock: On June 28, 2023, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with RBC Capital Markets, LLC and Truist Securities, Inc., as representatives of the several underwriters named therein, relating to the issuance and sale of an aggregate of 7,500,000 shares of the Company’s common stock, and in lieu of common stock to certain investors, pre-funded warrants to purchase 2,500,625 shares of common stock to the underwriters. Pursuant to the Underwriting Agreement, the Company also granted the underwriters a 30-day option to purchase up to 1,500,093 additional shares of common stock. The offering pursuant to the 2021 Shelf Registration Statement closed on July 3, 2023. Upon closing, the Company issued and sold an aggregate of 7,500,000 shares of its common stock at a public offering price of $ 4.00 per share and, in lieu of common stock to certain investors, pre-funded warrants to purchase up to an aggregate of 2,500,625 shares of its commons stock at a price of $ 3.999 per pre-funded warrants. The Company realized net proceeds of approximately $ 37,300,000 from the sale of its common stock and the pre-funded warrants. On July 26, 2023, the underwriters’ representatives fully exercised the option to purchase additional shares of the Company’s common stock, and on July 28, 2023, the Company issued and sold an aggregate of 1,500,093 shares of its common stock at the public offering price of $ 4.00 per share, less underwriting discounts and commissions, and the Company realized net proceeds of approximately $ 5,600,000 . In October 2024, the pre-funded warrants were exercised resulting in the issuance of 2,500,625 shares of common stock by the Company. Due to the pricing of the pre-funded warrants, net proceeds related to this transaction are de minimis. F- 21 On May 9, 2024, the Company filed a shelf registration statement (the “2024 Shelf Registration Statement”) for the issuance of up to $ 150,000,000 of Company securities. Also on May 9, 2024, the Company entered into an At-The-Market Issuance Sales Agreement with Leerink Partners LLC, as sales agent, pursuant to which the Company may sell, from time to time, an aggregate of up to $ 50,000,000 of its common stock through the sales agents under the 2024 Shelf Registration Statement, subject to limitations imposed by the Company and subject to the sales agent’s acceptance (the “2024 ATM program”). The sales agent is entitled to a commission of up to 3 % of the gross proceeds from the sale of common stock sold under the 2024 ATM program. As of December 31, 2024, the Company sold an aggregate of 3,049,878 shares of its common stock under the 2024 ATM program and realized an aggregate net proceeds of approximately $ 18,900,000 . Approximately $ 30,216,000 of the Company’s common stock remains available for sale under its 2024 ATM program, with $ 100,000,000 of capacity remaining under its 2024 Shelf Registration Statement for the issuance of Company securities. During the year ended December 31, 2023, the Company sold an aggregate 2,977,637 shares of its common stock under the Company’s previous at-the-market program, realizing net proceeds of approximately $ 12,900,000 . During the year ended December 31, 2024 and 2023, the Company issued an aggregate of 1,357,802 and 79,041 shares of its common stock upon exercise of stock options, resulting in net proceeds to the Company of approximately $ 7,724,000 and $ 288,000 , respectively. In December 2024, 44,999 shares of Series G preferred stock were converted to 2,502,005 shares of common stock. Restricted Stock Units During the year ended December 31, 2024 and 2023, the Company granted 283,333 and 50,000 restricted stock units (RSUs), respectively, to its executive officers under its Amended and Restated 2019 Omnibus Stock Incentive Plan with a weighted average grant date fair value of $ 3.47 and $ 3.30 per share, respectively. The fair market value of the RSUs was estimated to be the closing price of the Company’s common stock on the date of grant. The RSUs issued during the year ended December 31, 2024 vest 25 % on the grant date and 25 % each on the first, second and third anniversaries of the grant date, subject to continued service as an employee or consultant through the applicable vesting date. During the year ended December 31, 2024, the Company issued 42,844 shares upon the vesting of 25 % of these RSUs on the grant date and 27,989 shares were withheld in lieu of withholding taxes. The RSUs issued during the year ended December 31, 2023 vest over four years in four equal installments on the first four anniversaries of the applicable grant date, subject to continued service as an employee or consultant through the applicable vesting date. In December 2024, 12,500 of these RSUs vested which resulted in the issuance of 6,456 shares of common stock and 6,044 shares were withheld in lieu of withholding taxes. During the year ended December 31, 2024 and 2023, 62,241 and 103,734 RSUs vested, respectively, pursuant to a grant made to the Company’s chief executive officer in May 2022, of which 35,259 and 66,291 shares of common stock were issued by the Company, respectively, and 26,982 and 37,443 shares, respectively, were withheld in lieu of withholding taxes. The Company recorded $ 690,000 and $ 262,000 compensation expense for the year ended December 31, 2024 and 2023, respectively. As of December 31, 2024, unrecognized compensation expense for RSUs amounted to $ 671,000 and the expected weighted average period for the expense to be recognized is 1.5 years. As of December 31, 2024, the Company had 291,494 outstanding RSUs. F- 22 Preferred Stock The Company is authorized to issue up to 2,000,000 shares of preferred stock in one or more series without stockholder approval. The Company’s board of directors has the discretion to determine the rights, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, of each series of preferred stock. Of the 2,000,000 shares of preferred stock authorized, the Company’s board of directors has designated (all with par value of $ 0.001 per share) the following: As of December 31, 2024 As of December 31, 2023 Preferred Shares Outstanding Liquidation Preference (Per Share) Total Liquidation Preference Preferred Shares Outstanding Liquidation Preference (Per Share) Total Liquidation Preference Series C-3 2,000 $ 10.00 20,000 2,000 $ 10.00 $ 20,000 Series E 89,623 $ 49.20 4,409,452 89,623 $ 49.20 $ 4,409,452 Series G 45,000 $ 187.36 8,431,200 89,999 $ 187.36 $ 16,862,213 Total 136,623 12,860,652 181,622 $ 21,291,665 The following rights, privileges, terms and conditions apply to the outstanding preferred stock at December 31, 2024: Series C-3 Non-Voting Preferred Stock Rank. The Series C-3 non-voting preferred stock will rank senior to our common stock; senior to any class or series of capital stock created after the issuance of the Series C-3 non-voting preferred stock; and junior to the Series E voting convertible preferred stock in each case, as to dividends or distributions of assets upon our liquidation, dissolution or winding up whether voluntarily or involuntarily. Conversion. Each share of Series C-3 preferred stock is convertible into 2 shares of our common stock (subject to adjustment in the event of stock dividends and distributions, stock splits, stock combinations, or reclassifications affecting our common stock) at a per share price of $ 5.00 at any time at the option of the holder, except that a holder will be prohibited from converting shares of Series C-3 preferred stock into shares of common stock if, as a result of such conversion, such holder, together with its affiliates, would beneficially own more than 9.99 % of the total number of shares of our common stock then issued and outstanding. Liquidation Preference. In the event of our liquidation, dissolution or winding up, holders of Series C-3 preferred stock will receive a payment equal to $ 10.00 per share of Series C-3 preferred stock before any proceeds are distributed to the holders of our common stock. After the payment of this preferential amount, and subject to the rights of holders of any class or series of our capital stock hereafter created specifically ranking by its terms senior to the Series C-3 preferred stock and holders of Series C-3 preferred stock will participate ratably in the distribution of any remaining assets with the common stock and any other class or series of our capital stock hereafter created that participates with the common stock in such distributions. Voting Rights. Shares of Series C-3 preferred stock will generally have no voting rights, except as required by law and except that the consent of holders of two thirds of the outstanding Series C-3 preferred Stock will be required to amend the terms of the Series C-3 preferred stock or the certificate of designation for the Series C-3 preferred stock. Dividends. Holders of Series C-3 preferred stock are entitled to receive, and we are required to pay, dividends on shares of the Series C-3 preferred stock equal (on an as-if-converted-to-common-stock basis) to and in the same form as dividends (other than dividends in the form of common stock) actually paid on shares of the common stock when, as and if such dividends (other than dividends in the form of common stock) are paid on shares of the common stock. Redemption. We are not obligated to redeem or repurchase any shares of Series C-3 preferred stock. Shares of Series C-3 preferred stock are not otherwise entitled to any redemption rights, or mandatory sinking fund or analogous fund provisions. Listing. There is no established public trading market for the Series C-3 preferred stock, and we do not expect a market to develop. In addition, we do not intend to apply for listing of the Series C-3 preferred stock on any national securities exchange or trading system. F- 23 Fundamental Transactions. If, at any time that shares of Series C-3 preferred stock are outstanding, we effect a merger or other change of control transaction, as described in the certificate of designation and referred to as a fundamental transaction, then a holder will have the right to receive, upon any subsequent conversion of a share of Series C-3 preferred stock (in lieu of conversion shares) for each issuable conversion share, the same kind and amount of securities, cash or property as such holder would have been entitled to receive upon the occurrence of such fundamental transaction if such holder had been, immediately prior to such fundamental transaction, the holder of a share of common stock. Series E Voting Convertible Preferred Stock Rank. The Series E voting preferred stock will rank senior to our common stock; senior to any class or series of capital stock created after the issuance of the Series E voting convertible preferred stock; senior to the Series C-3 non-voting convertible preferred stock; and on parity with the Series G voting convertible preferred stock in each case, as to dividends or distributions of assets upon our liquidation, dissolution or winding up whether voluntarily or involuntarily. Conversion. Each share of Series E preferred stock is convertible into 4.3733 shares of our common stock (subject to adjustment as provided in the certificates of designation for the Series E preferred stock) at a per share price of $ 3.75 at any time at the option of the holder, except that a holder will be prohibited from converting shares of Series E preferred stock into shares of common stock if, as a result of such conversion, such holder, together with its affiliates, would beneficially own more than 4.99 % of the total number of shares of our common stock then issued and outstanding. Liquidation Preference. In the event of our liquidation, dissolution or winding up, holders of Series E preferred stock will receive a payment equal to $ 49.20 per share of Series E preferred stock on parity with the payment of the liquidation preference due the Series G preferred stock, but before any proceeds are distributed to the holders of common stock, and the Series C-3 non-voting convertible preferred stock. After the payment of this preferential amount, holders of Series E preferred stock will participate ratably in the distribution of any remaining assets with the common stock and any other class or series of our capital stock that participates with the common stock in such distributions. Voting Rights. Shares of Series E preferred stock are entitled to vote on an as-converted basis, based upon an assumed conversion price of $ 7.93 . Dividends. Holders of Series E preferred stock are entitled to receive, and we are required to pay, dividends on shares of the Series E preferred stock equal (on an as-if-converted-to-common-stock basis) to and in the same form as dividends (other than dividends in the form of common stock) actually paid on shares of the common stock when, as and if such dividends (other than dividends in the form of common stock) are paid on shares of the common stock. Redemption. We are not obligated to redeem or repurchase any shares of Series E preferred stock. Shares of Series E preferred stock are not otherwise entitled to any redemption rights, or mandatory sinking fund or analogous fund provisions. Listing. There is no established public trading market for the Series E preferred stock, and we do not expect a market to develop. In addition, we do not intend to apply for listing of the Series E preferred stock on any national securities exchange or trading system. F- 24 Fundamental Transactions. If, at any time that shares of Series E preferred stock are outstanding, we effect a merger or other change of control transaction, as described in the certificate of designation and referred to as a fundamental transaction, then a holder will have the right to receive, upon any subsequent conversion of a share of Series E preferred stock (in lieu of conversion shares) for each issuable conversion share, the same kind and amount of securities, cash or property as such holder would have been entitled to receive upon the occurrence of such fundamental transaction if such holder had been, immediately prior to such fundamental transaction, the holder of a share of common stock. Debt Restriction. As long as any of the Series E preferred stock is outstanding, we cannot create, incur, guarantee, assume or suffer to exist any indebtedness, other than (i) trade payables incurred in the ordinary course of business consistent with past practice, and (ii) up to $ 10 million aggregate principal amount of indebtedness with a maturity less than twelve months outstanding at any time, which amount may include up to $ 5 million of letters of credit outstanding at any time. Other Covenants. In addition to the debt restrictions above, as long as any of the Series E preferred stock is outstanding, we cannot, among others things: create, incur, assume or suffer to exist any encumbrances on any of our assets or property; redeem, repurchase or pay any cash dividend or distribution on any of our capital stock (other than as permitted, which includes the dividends on the Series E preferred stock and Series G preferred stock); redeem, repurchase or prepay any indebtedness (other than as permitted); or engage in any material line of business substantially different from our current lines of business. Purchase Rights. In the event we issue any options, convertible securities or rights to purchase stock or other securities pro rata to the holders of common stock, then a holder of Series E preferred stock will be entitled to acquire, upon the same terms a pro rata amount of such stock or securities as if the Series E preferred stock had been converted to common stock. Series G Voting Convertible Preferred Stock Rank . The Series G voting convertible preferred stock will rank senior to our common stock; senior to any class or series of capital stock created after the issuance of the Series G voting convertible preferred stock; junior to the Series C-3 non-voting convertible preferred stock, pending the consent of the holders of such series to the subordination thereof; and on parity with the Series E voting convertible preferred stock in each case, as to dividends or distributions of assets upon our liquidation, dissolution or winding up whether voluntarily or involuntarily. Conversion . Each share of Series G preferred stock is convertible into approximately 55.5978 shares of our common stock (subject to adjustment as provided in the certificate of designation for the Series G preferred stock) at a per share price of $ 3.37 at any time at the option of the holder, except that a holder will be prohibited from converting shares of Series G preferred stock into shares of common stock if, as a result of such conversion, such holder, together with its affiliates, would beneficially own more than 4.99 % of the total number of shares of our common stock then issued and outstanding. Liquidation Preference . In the event of our liquidation, dissolution or winding up, holders of Series E preferred stock will receive a payment equal to $187.36452 per share of Series G preferred stock on parity with the payment of the liquidation preference due the Series E preferred stock, but before any proceeds are distributed to the holders of Series C-3 preferred stock (pending the consent of the holders of such series to the subordination thereof) and any proceeds are distributed to the holders of common stock. After the payment of this preferential amount, holders of Series G preferred stock will participate ratably in the distribution of any remaining assets with the common stock and any other class or series of our capital stock that participates with the common stock in such distributions. Voting Rights . Shares of Series G preferred stock are entitled to vote on an as-converted basis, based upon an assumed conversion price of $ 7.93 . Dividends . Holders of Series G Preferred stock are entitled to receive, and we are required to pay, dividends on shares of the Series G preferred stock equal (on an as-if-converted-to-common-stock basis) to and in the same form as dividends (other than dividends in the form of common stock) actually paid on shares of the common stock when, as and if such dividends (other than dividends in the form of common stock) are paid on shares of the common stock. Redemption . We are not obligated to redeem or repurchase any shares of Series G preferred stock. Shares of Series G preferred stock are not otherwise entitled to any redemption rights, or mandatory sinking fund or analogous fund provisions. Listing . There is no established public trading market for the Series G preferred stock, and we do not expect a market to develop. In addition, we do not intend to apply for listing of the Series G preferred stock on any national securities exchange or trading system. F- 25 Fundamental Transactions . If, at any time that shares of Series G preferred stock are outstanding, we effect a merger or other change of control transaction, as described in the certificate of designation and referred to as a fundamental transaction, then a holder will have the right to receive, upon any subsequent conversion of a share of Series G preferred stock (in lieu of conversion shares) for each issuable conversion share, the same kind and amount of securities, cash or property as such holder would have been entitled to receive upon the occurrence of such fundamental transaction if such holder had been, immediately prior to such fundamental transaction, the holder of a share of common stock. Debt Restriction . As long as any of the Series G preferred stock is outstanding, we cannot create, incur, guarantee, assume or suffer to exist any indebtedness, other than (i) trade payables incurred in the ordinary course of business consistent with past practice, and (ii) up to $ 10 million aggregate principal amount of indebtedness with a maturity less than twelve months outstanding at any time, which amount may include up to $ 5 million of letters of credit outstanding at any time. Other Covenants . In addition to the debt restrictions above, as long as any of the Series G preferred stock is outstanding, we cannot, among others things: create, incur, assume or suffer to exist any encumbrances on any of our assets or property; redeem, repurchase or pay any cash dividend or distribution on any of our capital stock (other than as permitted, which includes the dividends on the Series E preferred stock and the Series G preferred stock); redeem, repurchase or prepay any indebtedness (other than as permitted); or engage in any material line of business substantially different from our current lines of business. Purchase Rights . In the event we issue any options, convertible securities or rights to purchase stock or other securities pro rata to the holders of common stock, then a holder of Series G preferred stock will be entitled to acquire, upon the same terms a pro rata amount of such stock or securities as if the Series G preferred stock had been converted to common stock. Stock Options: On October 13, 2022, the Company’s shareholders approved the CorMedix Inc. Amended and Restated 2019 Omnibus Stock Incentive Plan (the “2022 Plan”), pursuant to which the Company may issue as additional 4,800,000 shares of its common stock, respectively, plus any shares that remain available for grant under its existing plan as of the effective date, as long-term equity incentives to the Company’s employees, consultants, and directors. On November 21, 2024, the Company’s shareholders approved Amendment No. 1 to the 2022 Plan, which increased the number of shares authorized for issuance by an additional 3,360,000 shares. The long-term incentives may be in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights, or other rights or benefits (collectively, “stock rights”) to employees, consultants, and directors of the Company or a related entity (collectively, “participants”). The Company believes that the effective use of long- term equity incentives is essential to attract, motivate, and retain employees, consultants and directors, to further align participants’ interests with those of the Company’s stockholders, and to provide participants incentive compensation opportunities that are competitive with those offered by other companies in the same industry and locations as the Company. The 2022 Plan amends and restates the 2019 Stock Incentive Plan. The 2013 Stock Incentive Plan and the Amended and Restated 2006 Stock Incentive Plan are referred to collectively as the “Prior Plans.” No further awards will be granted under the Prior Plans. Awards outstanding under the Prior Plans will remain outstanding in accordance with their terms and the Prior Plans. During the years ended December 31, 2024 and 2023, the Company granted ten-year qualified and non-qualified stock options to its officers, directors, employees and consultants covering an aggregate of 2,196,167 and 2,536,200 shares of the Company’s common stock under the 2019 Plan, respectively. The weighted average exercise price of these options is $ 3.80 and $ 4.18 per share, respectively. F- 26 During the years ended December 31, 2024 and 2023, the Company issued 1,357,802 and 79,041 shares of common stock, respectively, as a result of the exercise of stock options. The Company realized net proceeds of $ 7,724,000 and $ 288,000 , respectively, from the exercise of stock options with a weighted average exercise price of $ 5.69 and $ 3.64 per share, respectively. During the years ended December 31, 2024 and 2023, total compensation expense for stock options issued to employees, directors, officers and consultants was $ 5,439,000 and $ 5,232,000 , respectively. As of December 31, 2024, there was $ 6,363,000 total unrecognized compensation expense related to unvested stock options granted which expense is expected to be recognized over an expected remaining weighted average period of 1.4 years. All share-based awards are recognized on a straight-line method, assuming all awards granted will vest. Forfeitures of share-based awards are recognized in the period in which they occur. The fair value at grants dates of the grants issued subject to service and performance-based vesting conditions were determined using the Black-Scholes option pricing model with the following assumptions: Year Ended December 31, 2024 2023 Risk-free interest rate 3.60 % - 4.65 % 3.45 % - 4.81 % Expected volatility 93.2 % - 100.5 % 92.2 % - 105.7 % Average Expected term (years) 6 years 5 years Expected dividend yield 0.0 % 0.0 % Weighted-average grant date fair value of options granted during the period $ 3.04 $ 3.24 The Company estimated the expected term of the stock options granted based on anticipated exercises in future periods. The expected term of the stock options granted to consultants, if any, is based upon the full term of the respective option agreements. The expected stock price volatility for the Company’s stock options is calculated based on the historical volatility of the Company’s common stock. The expected dividend yield of 0.0 % reflects the Company’s current and expected future policy for dividends on the Company’s common stock. To determine the risk-free interest rate, the Company utilized the U.S. Treasury yield curve in effect at the time of grant with a term consistent with the expected term of the Company’s awards. The following table summarizes the Company’s stock options activity and related information for the year ended December 31, 2024: Shares Underlying Stock Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding at December 31, 2023 6,211,508 $ 5.44 6.4 $ 700,241 Granted 2,196,167 $ 3.80 - $ - Exercised ( 1,357,802 ) $ 5.69 - $ 3,750,304 Expired/Canceled ( 418,932 ) $ 12.27 - $ - Forfeited ( 348,548 ) $ 3.68 - $ - Outstanding at December 31, 2024 6,282,393 $ 4.46 7.8 $ 23,567,676 Vested at December 31, 2024 3,377,378 $ 4.91 7.1 $ 11,415,702 Expected to vest in the future 2,905,015 $ 3.93 8.6 $ 12,151,975 The aggregate intrinsic value is calculated as the difference between the exercise prices of the underlying options and the quoted closing price of the common stock of the Company at the end of the reporting period for those options that have an exercise price below the quoted closing price. F- 27 Stock-based Deferred Compensation Plan for Non-Employee Directors In 2014, the Company established an unfunded stock-based deferred compensation plan, providing non-employee directors the opportunity to defer up to one hundred percent of fees and compensation, including restricted stock units. The amount of fees and compensation deferred by a non-employee director is converted into stock units, the number of which is determined based on the closing price of the Company’s common stock on the date such compensation would have otherwise been payable. At all times, the plan participants are one hundred percent vested in their respective deferred compensation accounts. On the tenth business day of January in the year following a director’s termination of service, the director will receive a number of common shares equal to the number of stock units accumulated in the director’s deferred compensation account. The Company accounts for this plan as stock-based compensation under ASC 718. During the years ended December 31, 2024 and 2023 no compensation was deferred under this plan. Note 9 — Leases: The Company entered into a seven-year operating lease agreement in March 2020 for an office space at 300 Connell Drive, Berkeley Heights, New Jersey 07922. The lease agreement, with a monthly average cost of approximately $ 17,000 commenced on September 16, 2020. The Company entered into an operating lease for office space in Germany that began in July 2017. The rental agreement has a three-month term which automatically renews and includes a monthly cost of 400 Euros. The operating lease was terminated in June 2024. Operating lease expense in the Company’s consolidated statements of operations and comprehensive loss for the years ended December 31, 2024 and 2023 was approximately $ 204,000 and $ 207,000 , respectively, which includes costs associated with leases for which ROU assets have been recognized as well as short-term leases. At December 31, 2024, the Company has a total operating lease liability of $ 517,000 , of which approximately $ 168 ,000 and $ 349 ,000 were classified as operating lease liabilities, short-term and operating lease liabilities, net of current portion, respectively, on the consolidated balance sheet. At December 31, 2023, the Company’s total operating lease liability was $ 668 ,000, of which $ 151 ,000 was classified as operating lease liabilities, short-term and $ 517 ,000 was classified as operating lease liabilities, net of current portion, on the consolidated balance sheet. Operating ROU assets as of December 31, 2024 and 2023 are $ 493 ,000 and $ 640 ,000, respectively. For the years ended December 31, 2024 and 2023, cash paid for amounts included in the measurement of lease liabilities in operating cash flows from operating leases was $ 205,000 and $ 201,000 , respectively. As of December 31, 2024 and 2023, the weighted average remaining lease term were 2.8 years and 3.8 years, respectively, and the weighted average discount rate of 9 % at December 31, 2024 and 2023. As of December 31, 2024, maturities of lease liabilities were as follows: 2025 208,000 2026 211,000 2027 169,000 Total future minimum lease payments 588,000 Less imputed interest ( 71,000 ) Total $ 517,000 F- 28 Note 10 — Segment Reporting As noted above, the Company’s primary focus is the commercialization of our lead product, DefenCath indicated to reduce the incidence of catheter-related bloodstream infections in adult patients with kidney failure receiving chronic hemodialysis through a CVC. The Company has determined that it currently operates in a single segment - Drug Product, located in a single geographic location – the United States. The accounting policies of the segment are the same as those described in the summary of significant accounting policies. Since the Company operates in a single segment, the measure of segment total assets and loss from operations is the same as that reported on the accompanying balance sheets as total assets, and the accompanying statement of operations as loss from operations, respectively. The Company’s Chief Executive Officer is the Chief Operating Decision Maker (“CODM”). The CODM manages the Company’s business activities as a single operating and reportable segment. The CODM uses consolidated profit and loss to evaluate and measure performance against progress in its commercialization efforts and clinical trials. The following table sets forth significant segment expenses. December 31, 2024 2023 Research and development: Employee expense $ 2,454,650 $ 7,210,785 Other research and development 1,487,620 5,944,341 Total research and development 3,942,270 13,155,125 Selling and marketing Employee expense $ 13,493,663 $ 2,552,846 Other selling and marketing 15,242,942 15,562,467 Total selling and marketing expense 28,736,605 18,115,313 General and administrative Employee expense $ 18,321,459 $ 10,961,034 Other general and administrative 11,637,691 6,726,316 Total general and administrative expense 29,959,150 17,687,350 Total operating expenses $ 62,638,025 $ 48,957,788 F- 29