What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2023-03-30 compared with 2022-03-24 · 374 added, 549 removed, 608 unchanged (60% of the section changed)

Financial Statements and Supplementary Data.

Financial Statements.

Financial Statements

Report of Independent Registered Public Accounting Firm ( KPMG LLP , PCAOB 185 )

1 unchanged sentence

Statements of Comprehensive Loss for the Years Ended December 31, 2022 and 2021

Statements of Stockholders’ Equity (Deficit) for the Years Ended December 31, 2021 and

Statements of Stockholders’ Equity for the Years Ended December 31, 2022 and 2021

Statements of Cash Flows for the Years Ended December 31, 2022 and 2021

8 unchanged sentences

(the Company) as of December 31, 2022 and

2020, the related statements of comprehensive loss, stockholders’ equity (deficit), and cash flows for the years then ended, and the related notes (collectively, the financial statements).

In our opinion, the financial

statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the years in the two-year period ended

December 31, 2021, in conformity with U.S.

2021, the related statements of comprehensive loss, stockholders’ equity, and cash flows for the years then ended, and the related notes (collectively, the financial statements).

In our opinion, the financial statements present

fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2022, in conformity

generally accepted accounting principles.

Going Concern

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

As discussed in Note 1 to the financial statements, the Company has suffered recurring losses

and negative cash flows from operations and has a net accumulated deficit that raise substantial doubt about its ability to continue as a going concern.

Management’s plans in regard to these matters are also described in Note 1.

The financial

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

Basis for Opinion

6 unchanged sentences

Those standards require that we plan and perform the audit to obtain

reasonable assurance about whether the financial statements are

free of material misstatement, whether due to error or fraud.

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

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.

reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

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.

We have served as the Company’s auditor since 2016.

2 unchanged sentences

Balance Sheets

December 31, 2021

December 31, 2020

Current assets:

19 unchanged sentences

Balance Sheets

Liabilities, Redeemable Preferred Stock and Stockholders’ Equity (Deficit)

December 31, 2021

December 31, 2020

Liabilities and Stockholders’ Equity

Current liabilities:

8 unchanged sentences

Clinical holdback - long-term portion

Note payable – long-term portion

Lease liabilities – long-term portion

Other – long-term

Total long-term liabilities

1 unchanged sentence

Commitments and contingencies

Redeemable convertible preferred stock:

Preferred stock, Series B, $ 0.001 par, none authorized, issued and outstanding as of December 31, 2021 ;

13,344,349 shares authorized, issued and outstanding as of

December 31, 2020

Preferred stock, Series C, $ 0.001 par, none authorized, issued and outstanding as of December 31, 2021 ;

42,491,484 shares authorized, issued and outstanding as of

December 31, 2020

Stockholders’ equity (deficit):

Stockholders’ equity:

Common stock, $ 0.001 par, 200,000,000 authorized, 11,986,927

shares issued and 11,869,704 outstanding as of December 31, 2022 ;

and 95,583,558 authorized, 1,110,347 shares issued and 993,124

outstanding as of December 31, 2020

and 11,921,388 shares issued and 11,804,165 outstanding as of December 31, 2021

Treasury stock, 117,223 shares

Preferred stock, Series A, $ 0.001 par, none authorized, issued and outstanding as of December 31, 2021 ;

17,310,609 shares authorized, and 17,210,609 shares issued and outstanding as of December 31, 2020

Additional paid-in-capital

Accumulated other comprehensive loss, net of tax

Accumulated deficit

Total stockholders’ equity (deficit)

Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit)

Total stockholders’ equity

Total liabilities and stockholders’ equity

See accompanying notes to financial statements.

1 unchanged sentence

Years ended December 31, 2022 and 2021

December 31, 2021

December 31, 2020

Cost of sales

13 unchanged sentences

Income tax expense

Comprehensive loss:

Change in fair value of available for sale investments

Total comprehensive loss

Net loss attributable to common stockholders, basic and diluted

8 unchanged sentences

Preferred stock

comprehensive

stockholders’

paid-in capital

comprehensive

loss, net of tax

2 unchanged sentences

Issuance of common stock for cash upon exercise of options

Issuance of common stock in connection with IPO

Automatic conversion of preferred stock in connection with IPO

Share-based compensation expense

Other comprehensive income

Balance at December 31, 2021

Issuance of common stock for cash upon exercise of options

Issuance of common stock for in connection with IPO

Automatic conversion of preferred stock in connection with IPO

Issuance of common stock in connection with Employee Stock Purchase Plan

Issuance of common stock in connection with At-The-Market offering, net of issuance costs of $ 95

Share-based compensation expense

Expiration of warrant

Balance at December 31, 2022

5 unchanged sentences

Adjustments to reconcile net loss to net cash used in operating activities:

Amortization of discount on investments

Amortization of right-of-use assets

6 unchanged sentences

Accounts payable

Accrued expenses and other

Lease liabilites

Accrued expenses

Lease liabilities

Other liabilities

1 unchanged sentence

Cash flows from investing activities:

Maturities of short-term investments

Purchases of furniture and equipment

Payments for patents and other intangible assets

Net cash (used in) provided by investing activities

Net cash used in investing activities

Cash flows from financing activities:

1 unchanged sentence

Proceeds from issuance of common stock

Proceeds from note payable

Repayment of note payable

Repayment of notes payable

Payments under lease obligations

Net cash provided by financing activities

Net cash (used in) provided by financing activities

Net change in cash and cash equivalents

5 unchanged sentences

Conversion of convertible preferred stock to common stock

Deferred offering costs included in accounts payable and accrued expenses

Commission costs relating to certain proceeds from issuance of common stock

Prepaid insurance financed with promissory notes

1 Deferred offering costs includes $ 95 of offering costs charged against certain proceeds from

the issuance of common stock.

See accompanying notes to financial statements.

3 unchanged sentences

Organization and Nature of Business

(the Company or Femasys) was incorporated in Delaware on February 19, 2004 and is

headquartered in Suwanee, Georgia.

The Company is a biomedical company focused on transforming women’s healthcare by developing novel solutions and next-generation advancements providing significant clinical impact to address severely underserved

Our mission is to provide women worldwide with superior minimally-invasive, non-surgical product technologies, accessible in the office, improving patient care and overall health economics.

The Company currently operates as one segment and is focused on servicing the reproductive health needs for those seeking permanent birth control or solutions for infertility issues.

Femasys has an expansive intellectual property portfolio which covers both design and utility patents in the

and significant ex-U.S.

(the Company or

Femasys) was incorporated in Delaware on February 19, 2004 and is headquartered in Suwanee, Georgia.

The Company is a biomedical company focused on transforming women’s healthcare by developing novel solutions and next-generation advancements

providing significant clinical impact to address severely underserved areas.

The Company’s mission is to provide women with superior minimally-invasive, non-surgical product technologies, accessible in the office, improving patient care and

overall health economics.

The Company currently operates as one segment with an initial focus on servicing the reproductive health

needs for those seeking permanent birth control or solutions for infertility issues.

Femasys has an expansive intellectual property portfolio which covers both design and utility patents in the U.S.

significant ex-U.S.

markets for each product initiative.

Femasys has taken concepts internally conceived and protected through development, including domestic and foreign regulatory approvals, and production, through in-house

manufacturing.

FemBloc® (FemBloc), the Company’s solution for permanent birth control, is based on the Company’s non-surgical platform technology and is presently completing a validation study under an approved Investigational Device Exemption

(IDE) from the U.S.

Food and Drug Administration (FDA).

FemaSeed® (FemaSeed), a solution which enables directed intrauterine insemination to improve on traditional IUI and provide a lower cost option to in vitro fertilization methods, received

approval in April 2021 from the FDA on its IDE and the clinical study was initiated in July 2021.

FemVue® Saline-Air Device (FemVue) is a product approved for sale in the U.S., Europe, Japan, and Canada for the diagnosis of infertility.

Pressure Management Device (FemChec) evaluates the women’s fallopian tubes after a FemBloc procedure and is part of the FemBloc validation study.

FemCerv® Endocervical Sampler (FemCerv) is designed to collect a complete, non-contaminated cervical

tissue sample.

Femasys has taken concepts internally conceived and protected through development, including domestic and foreign regulatory approvals, and production, through in-house manufacturing.

FemBloc® (FemBloc), the Company’s solution for permanent birth control, is based on the Company’s non-surgical platform technology and we recently completed a validation study under an approved Investigational Device Exemption (IDE) from the

Food and Drug Administration (FDA) and plan to use the study data to support which of the two confirmation tests (ultrasound or radiology) should be studied in a new pivotal trial to support a potential future application for PMA for

Results of the small study along with the trial design for the pivotal clinical trial is planned for submission to the FDA in the first quarter of 2023.- FemaSeed® (FemaSeed), a solution which enables directed intrauterine insemination

to improve on traditional intrauterine insemination (IUI) and provides a lower cost option to in vitro fertilization methods, received approval in April 2021 from the FDA on its IDE and the clinical study was initiated in July 2021.

study design received approval in October 2022 from the FDA.

FemVue® (FemVue), a solution that enables fallopian tube assessment with ultrasound as an alternative to the radiologic approach (hysterosalpingogram) for the diagnosis of infertility,

is approved for sale in the U.S., Japan, and Canada.

FemChec® (FemChec), allows for fallopian tube evaluation after a FemBloc procedure to confirm occlusion (or procedure success).

FemCerv® (FemCerv) is a solution for complete tissue sampling

with minimal contamination of the endocervical canal as an alternative to the single biopsy method, and is approved for sale in the U.S.

FemCath™ (FemCath), allows for selective evaluation of an individual fallopian tube as an alternative to the

traditional intrauterine catheter that is undirected, is approved for sale in the U.S.

Basis of Presentation

4 unchanged sentences

The Company plans to finance its operations and development needs with its existing cash and cash equivalents, in the future with additional

equity and/or debt financing arrangements, and revenue from the sale of FemVue to support the Company’s research and development activities, largely in connection with FemBloc and FemaSeed.

There can be no assurance that the Company will be able to

obtain additional financing on terms acceptable to the Company, on a timely basis, or at all.

If the Company is not able to obtain sufficient funds on acceptable terms when needed, the Company’s business, results of operations, and financial

condition could be materially adversely impacted.

equity and/or debt financing arrangements, and revenue primarily from the sale of FemVue to support the Company’s research and development activities, largely in connection with FemBloc and FemaSeed.

There can be no assurance that the Company will

be able to obtain additional financing on terms acceptable to the Company, on a timely basis, or at all.

If the Company is not able to obtain sufficient funds on acceptable terms when needed, the Company’s business, results of operations, and

financial condition could be materially adversely impacted.

For the year ended December 31, 2022, the Company generated a net loss of $ 11,394,170 .

The Company expects such losses to increase over the next few years as the Company advances FemBloc and FemaSeed through clinical development

until FDA approval is received and the products are available to be marketed.

The Company believes that its cash and cash equivalents as of December 31, 2021 will be sufficient to

fund its operating expenses and research & development expenditure requirements through at least 12 months from the date of filing these financial statements for the year ended December 31, 2021.

The financial statements have been prepared on a going-concern basis, which contemplates the

realization of assets and the satisfaction of liabilities in the normal course of business.

The Company expects such losses to increase over the next few years as the Company advances FemBloc and FemaSeed through clinical

development until FDA approval is received and the products are available to be marketed.

The financial statements have been

prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

The Company has incurred net operating losses in every year since inception and has an

accumulated deficit as of December 31, 2022 of $ 94,134,505 and expects to incur additional losses and negative operating cash flows for

at least the next twelve months.

The Company’s ability to meet its obligations is dependent upon its ability to generate sufficient cash flows from operations and future

financing transactions.

Although management expects the Company will continue as a going concern, there is no assurance that management’s plans will be successful since the availability and amount of such funding is not certain.

substantial doubt exists about the Company’s ability to continue as a going concern for at least one year from the issuance of these financial statements.

The accompanying financial statements do not include any adjustments to reflect the

possible future effects on the recoverability of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.

Notes to Financial Statements

December 31, 2022 and 2021

The Company is evaluating strategies to obtain the required additional funding for future operations.

These strategies may include, but are not limited to, obtaining

equity financing, issuing debt or entering into other financing arrangements, and restructuring of operations to grow revenues and decrease expenses.

However, given the impact of the economic downturn on the U.S.

and global financial markets, the

Company may be unable to access further equity or debt financing when needed.

As such, there can be no assurance that the Company will be able to obtain additional liquidity when needed or under acceptable terms, if at all.

Summary of Significant Accounting Policies

5 unchanged sentences

The most significant estimates used in these financial statements include the pre-IPO valuation of common stock,

preferred stock, stock options, warrants, and the valuation of useful lives of property and equipment and intangible assets.

stock options, warrants, the valuation of useful lives of property and equipment, and clinical trial cost accruals .

Actual results could differ from those estimates.

Notes to Financial Statements

December 31, 2021 and 2020

Certain Risk and Uncertainties

M ost of the products

developed by the Company, such as its FemBloc and FemaSeed, will require approval from the FDA or corresponding foreign regulatory agencies prior to commercial sales.

The FemVue Catheter System, FemVue® Saline‑Air Device, FemChec® Pressure

Management Device, and FemCerv® Endocervical Sampler have achieved FDA clearance.

The Company maintains a current CE mark for FemVue® Saline‑Air Device and FemCerv® Endocervical Sampler.

The FemVue® Saline‑Air Device has also received approval

to sell in Canada, Europe, Hong Kong and Japan.

Most of the products developed by the Company, such as its FemBloc and FemaSeed, will require approval from the FDA or corresponding foreign regulatory agencies prior to commercial sales.

FemCath (formally FemVue) Cornual Balloon Catheter, FemVue® Saline‑Air Device, FemChec® Pressure Management Device, and FemCerv® Endocervical Sampler have achieved FDA clearance.

The FemVue® Saline‑Air Device has also received approval to sell

in Canada, Hong Kong and Japan.

There can be no assurance the Company’s other products in development will receive the necessary clearances.

If the Company is denied clearance or clearance is delayed, it might have a material

adverse impact on the Company.

If the Company is denied clearance or clearance is delayed, it might have a material adverse impact on

The medical device industry is characterized by frequent and extensive litigation

16 unchanged sentences

accounts receivable, inventory, accounts payable, accrued expenses, notes payable and other liabilities approximate their fair value because of the short‑term maturity of these financial instruments.

The fair value of our cash equivalents are

based on Level 1 inputs (notes 3 and 4), and the fair value of stock options and warrants is based on Level 3 inputs (note 3).

The fair value of the Company’s cash

equivalents are based on Level 1 inputs (notes 3 and 4), and the fair value of stock options and warrants is based on Level 3 inputs (note 3).

Cash and Cash Equivalents

The Company considers all highly liquid investments with an initial maturity of

three months or less when purchased to be cash equivalents.

Cash equivalents, which may consist of amounts invested in money market funds, corporate bonds and commercial paper, are stated at fair value.

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

Cash equivalents consist of amounts invested in money market mutual funds and are stated at fair valu e.

See note 2(q) for information on concentration of credit risk.

Notes to Financial Statements

December 31, 2022 and 2021

Accounts Receivable

4 unchanged sentences

expense when it is determined that the likelihood a customer account is uncollectible is probable.

For the years ending December 31, 2021 and 2020, no

charges written off against the reserve.

As of December 31, 2021 and 2020, the Company’s reserves for uncollectible accounts were $ 2,026 .

For the year ending December 31, 2022, the company had written off $ 977 against the reserve, compared to $ 0 in 2021.

As of December 31, 2022 and 2021, the Company’s

reserves for uncollectible accounts were $ 2,048 and $ 2,026 , respectively.

Inventories are stated at the lower of cost or net realizable

4 unchanged sentences

obsolescence and accounts for such items once identified.

In 2021 and 2020, the Company disposed of inventory in the amount of $ 586 and $ 7,388 , respectively.

In 2022 and 2021, the Company disposed of inventory in the amount of $ 2,847 and

$ 586 , respectively.

As of December 31, 2022 and 2021, the FemVue reserve for slow moving, obsolete, or unusable inventories was $ 2,103 and $ 850 , respectively.

Inventory stated at cost, net of reserve, consisted of the

following as of December 31:

Inventory stated at cost,

net of reserve, consisted of the following as of December 31:

Work in progress

1 unchanged sentence

Inventory, net

Notes to Financial Statements

December 31, 2021 and 2020

The Company has research tax credits that are available to the

18 unchanged sentences

Machinery and equipment

Notes to Financial Statements

December 31, 2022 and 2021

Depreciation expense for the years ended 2022 and

2 unchanged sentences

In 2022, the Company disposed of property and equipment at a cost of $ 28,234 with a net book value of $ 2,285 , which is recorded in other expense on the statements of comprehensive loss.

In 2020, the Company disposed of property and equipment at a cost

of $ 21,500 with no net

In 2021, the Company disposed

of property and equipment at a cost of $ 11,401 with a net book value of $ 3,098 , which is recorded in other expense on the statements of comprehensive loss.

Impairment of Long-Lived Assets

17 unchanged sentences

The Company records finance leases as right-to-use assets and finance lease liabilities in its balance sheets for all finance leases with terms exceeding one year , similar to operating leases, and records interest expense and depreciation expense on the right-of-use asset in the statement of comprehensive

Notes to Financial Statements

December 31, 2021 and 2020

Intangible Assets

8 unchanged sentences

respectively.

Amortization expense related to intangible assets is expected to be $ 21,799 and $ 3,294 for the years ended December 31, 2022 and 2023.

Amortization expense related to intangible assets is expected to be $ 3,294 for the year ended December 31, 2023.

Deferred Offering Costs

1 unchanged sentence

fees directly attributable to a strategic financing transaction, were capitalized in accordance with Staff Accounting Bulletin (SAB) Topic 5.A, codified in Accounting Standards Codification (ASC) 340-10-S99-1.

During 2022, the Company incurred $ 232,845 in deferred offering costs in connection with the Equity Distribution Agreement entered in July 2022 with Piper Sandler which included an At-The-Market (ATM) facility.

These deferred offering costs will be offset against the total proceeds from the issuance of common stock available under the Equity Distribution Agreement, and the Company will expense any remaining balance of deferred offering costs if the Equity

Distribution agreement is terminated or aborted.

In December 2022, the Company offset $ 95 of deferred offering costs in connection with

the gross proceeds issued under the ATM facility.

Notes to Financial Statements

December 31, 2022 and 2021

In May 2021, the Company expensed $ 188,544 of deferred offering costs in connection with another financing transaction to focus on the IPO transaction.

In June 2021, upon the closing of

the IPO, total deferred offering costs of $ 1,591,143 were offset against the proceeds of the IPO offering.

In June 2021, upon the closing of the IPO, total deferred

offering costs of $ 1,591,143 were offset against the proceeds of the IPO offering.

As of December 31, 2022, deferred offering costs capitalized were $ 232,750 and are included in other long-term assets in the accompanying balance sheet.

As of December 31, 2021, no amounts of deferred offering costs were capitalized.

As of December 31, 2020, deferred offering costs capitalized were $ 202,479 and are included in other long-term assets in the accompanying balance sheets.

Accrued Expenses

Accrued clinical trial expenses include research and development costs for

third-party services, largely related to our clinical trials, that are estimated based upon the services provided but not yet invoiced.

These costs, at times, may be a significant component of the research and development expenses and the Company

makes estimates in determining the accrued expense each period.

third-party services, largely related to the Company’s clinical trials, that are estimated based upon the services provided but not yet invoiced.

These costs, at times, may be a significant component of the research and development expenses and the

Company makes estimates in determining the accrued expense each period.

As actual costs become known, the Company adjusts its accrual.

Accrued compensation expenses as of December 31, 2020 include compensation expense in connection with a retention plan

that was put in place in November 2019 for certain employees, which were paid in 2021.

Accrued other expenses include director fees, sales taxes and other accrued expenses.

Accrued other expenses include director fees, sales

taxes and other accrued expenses.

Accrued expenses consisted of the following as of December 31:

13 unchanged sentences

invoiced costs, generally ranging between 5 % - 15 %, that is withheld from payment until the end of the study.

These retained amounts are recorded as clinical holdback, a liability, on the accompanying balance sheets, and all expenses

incurred in connection with these CTA activities are expensed as services are provided, which are included as research and development expenses on the accompanying statements of comprehensive loss.

These retained amounts are recorded as clinical holdback, a liability, on the accompanying balance sheets, and all expenses incurred in connection with

these CTA activities are expensed as services are provided, which are included as research and development expenses on the accompanying statements of comprehensive loss.

The following table shows the activity within the clinical holdback liability

14 unchanged sentences

Clinical holdback - long-term portion

Notes to Financial Statements

December 31, 2022 and 2021

Revenue Recognition

3 unchanged sentences

exclude amounts collected from customers for all sales (and other similar) taxes from the transaction price.

The Company does not have multiple performance obligations in its customer orders, so revenue is recognized upon shipment of our goods

based upon contractually stated pricing at standard payment terms ranging from 30 to 60 days.

The Company does not have multiple performance obligations in its customer orders, so revenue is recognized upon shipment of the Company’s

goods based upon contractually stated pricing at standard payment terms ranging from 30 to 60 days.

All revenue is recognized point in time and no revenue is recognized over time.

There was no revenue recognized during the years ended December 31, 2022 and 2021 from performance obligations satisfied or partially satisfied in prior periods.

Additionally, there were no unsatisfied performance obligations as of December 31, 2021 and 2020.

Additionally, there

were no unsatisfied performance obligations as of December 31, 2022 and 2021.

The majority of products sold directly to U.S customers are shipped via common

carrier, and the customer pays for shipping and handling and assumes control Free on Board (FOB) shipping point.

Products shipped to our international distributors are in accordance with their respective agreements;

however, the shipping terms are

generally EX-Works, reflecting that control is assumed by the distributor at the shipping point.

Products shipped to the Company’s international distributors are in accordance with their respective agreements;

however, the shipping

terms are generally EX-Works, reflecting that control is assumed by the distributor at the shipping point.

Returns are only accepted with prior authorization from the Company.

Items to be returned must be in original unopened cartons and are subject to a 30 % restocking fee.

Items to be returned must be in original unopened cartons and are

subject to a 30 % restocking fee.

As of December 31, 2022, the Company has not had a history of significant returns.

The following table summarizes our FemVue sales by geographic

region for the years ending December 31:

The following table summarizes the Company’s sales, primarily

from FemVue, by geographic region for the years ending December 31:

Primary geographical markets

6 unchanged sentences

and Femasys records revenue at that time.

Notes to Financial Statements

December 31, 2021 and 2020

Concentration of Credit Risk

Financial instruments that

potentially subject the Company to concentration of credit risk consist primarily of cash, money market funds, and accounts receivable.

The Company maintains its cash and money market funds primarily in one bank in amounts which, at times, exceed

federally insured limits.

Management believes that the financial institution that holds the Company’s cash and money market funds is financially sound and minimal credit risk exists with respect to these holdings.

Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of cash, cash equivalents, and accounts receivable.

As of December 31, 2022, the Company maintained substantially all its cash and cash equivalents primarily in one bank, Silicon Valley Bank (SVB), in amounts which, at times, exceed federally insured limits, which Management believed, at that

time, SVB was financially sound and minimal credit risk existed with respect to these holdings.

As of March 15, 2023, the Company transferred substantially all of its cash and cash equivalents to another financial institution, Wells Fargo Bank.

The Company generates revenue from sales directly to U.S.

customers and to our

international distributors with all prices in U.S.

customers and to the

Company’s international distributors with all prices in U.S.

For the years ended December 31, 2022 and 2021, Bayer Yakuhin, Ltd.

3 unchanged sentences

As of December 31, 2022, the

Company had no customer with an accounts receivable balance greater than 10% of total receivables.

As of December 31, 2020, the Company

had two customers with an accounts receivable balance greater than 10% of total receivables or representing 18 % and 11 % of total receivables.

Company had one customer with an accounts receivable balance greater than 10% of total receivables or 16 % of total receivables.

As of December 31, 2021, the company had no customer with an accounts receivable balance greater than 10% of total receivables.

Notes to Financial Statements

December 31, 2022 and 2021

Research and Development

40 unchanged sentences

The use of net operating losses generated in tax years prior to 2018 may also subject returns for those years to examination.

In June 2021, the Company was notified by Georgia Primary Bank that the Paycheck

Protection Program (PPP) loan in the amount of $ 812,500 and accrued interest of $ 9,015 was fully forgiven.

For the year ended December 31, 2021, the Company recorded $ 821,515

in other income in connection with the Small Business Administration (SBA) PPP loan forgiveness program (see note 6).

In April 2020, the Company received the SBA Economic Injury Disaster Loan advance

(EIDL advance) of $ 10,000 .

This EIDL advance was originally included in notes payable (see note 6) since the SBA was required to deduct

the amount of any EIDL advance received by a Paycheck Protection Program (PPP) borrower from the PPP forgiveness payment remitted by SBA to the lender.

In December 2020, the Economic Aid to Hard-Hit Small Business, Nonprofits and Venues Act

(Economic Aid Act) was signed into law, which repealed the SBA requirement to deduct the amount of any EIDL advance received by a PPP borrower from the PPP forgiveness payment.

As a result of the Economic Aid Act, the Company recognized the EIDL

advance as grant income in December 2020, which is recorded as other income on the statements of comprehensive loss.

For the year ended December 31, 2022, the Company recorded no other income.

For the year ended December 31, 2021, the Company recorded $ 821,515 in other income in connection with the Small Business Administration (SBA) Paycheck Protection Program (PPP) loan forgiveness program (see note 6).

Notes to Financial Statements

26 unchanged sentences

We do not expect the adoption of

the standard to have a significant impact on our results of operations, financial position or cash flows as credit losses are not expected to be significant based on historical collection trends, the financial condition of payment partners, and

external market factors.

the standard to have a significant impact on the Company’s results of operations, financial position or cash flows as credit losses are not expected to be significant based on historical collection trends, the financial condition of payment

partners, and external market factors.

No other new accounting pronouncement issued or effective has had, or is expected to

8 unchanged sentences

model‑based techniques that use significant assumptions not observable in the market.

These unobservable assumptions reflect our own estimates of assumptions market participants would use in pricing the asset or liability.

These unobservable assumptions reflect the Company’s own estimates of assumptions market participants would use in pricing the asset or liability.

The Company’s options on common stock and warrants are classified as equity

3 unchanged sentences

Company’s volatility and price of the underlying stock (notes 8 and 9).

Notes to Financial Statements

December 31, 2021 and 2020

Cash and Cash Equivalents

1 unchanged sentence

money market funds included in cash and cash equivalents on the balance sheets were $ 12,553,557 and $ 24,388,443 , respectively, which represent Level 1 within the fair value hierarchy (see note 3).

Notes to Financial Statements

December 31, 2022 and 2021

Commitments and Contingencies

3 unchanged sentences

agreed by both parties, and upon certain terms and conditions and the Company must provide written notice of its intent to exercise this extension option at least twelve months prior to the expiration date of January 2024.

Under the terms of the

lease agreement, the Company’s monthly rent is subject to increases on an annual basis.

In September 2022, the Company provided written notice to the lessor of its intent to exercise this extension option and is currently working with the lessor on the terms.

Under the terms of the lease agreement, the Company’s monthly rent is subject to increases

on an annual basis.

As of December 31, 2022, the Company’s monthly rent payment was $ 45,659 .

6 unchanged sentences

As of December 31, 2022 and 2021, the weighted average discount rate for all operating leases with initial terms of more than one year was approximately 10 % and the weighted average remaining term for operating leases was 1.1 years and 2.1 years, respectively.

The operating lease agreement for our facility

includes non-lease costs, such as common area maintenance, which are recorded as variable lease costs.

The operating lease agreement for the Company’s

facility includes non-lease costs, such as common area maintenance, which are recorded as variable lease costs.

Operating lease expenses for the year ended are summarized as follows for the years ending December 31:

2 unchanged sentences

Variable lease cost

Notes to Financial Statements

December 31, 2021 and 2020

Financing Leases

2 unchanged sentences

Lease expense will be recognized as payment of financing lease, depreciation expense and interest expense.

Notes to Financial Statements

December 31, 2022 and 2021

Financing right-of-use assets and lease liabilities consist of

29 unchanged sentences

according to the CTA for the duration of the trial.

Expenses incurred in connection with these CTA activities are expensed as services are provided and are included in research and development expenses on the accompany statements of

Expenses incurred in connection with these CTA activities are expensed as services are provided and are included in research and development expenses on the accompanying statements of

comprehensive loss.

16 unchanged sentences

Notes Payable

Notes payable as of December 31, 2021 and December 31, 2020 are

Notes payable - current portion

Notes payable - long-term portion

Total notes payable

Paycheck Protection Program Loan

In April 2020, the Company executed a promissory note (Note)

with Georgia Primary Bank (the Lender) evidencing an unsecured loan in the amount of $ 812,500 , which was made pursuant to the PPP.

PPP was established under the Coronavirus Aid, Relief and Economic Security Act (CARES Act), which was enacted on March 27, 2020, and is administered by the SBA.

All the funds under the PPP loan were disbursed to the Company in April 2020 and was

recognized as debt on the Company’s financial statements.

The Note provided for a fixed interest rate of one percent per year, and the Company was not imputing any additional interest at a market rate because this was a government-guaranteed obligation.

Monthly principal and interest payments of $ 45,717

on the PPP loan were due beginning November 2020 and the final payment was due in April 2022 (Maturity Date).

The Note contained customary event of default provisions.

Under the terms of the CARES Act, PPP loan recipients could

apply for and be granted forgiveness for all or a portion of the loans granted under the PPP.

Such forgiveness is subject to approval by the SBA and the Lender and determined, subject to limitations, based on factors set forth in the CARES Act,

including verification of the use of loan proceeds for payment of payroll costs and payment of mortgage interest, rent, and utilities.

In the event the PPP loan, or any portion thereof, is forgiven, it is applied to outstanding principal.

September 30, 2020, the Company had used all the proceeds from the PPP loan to retain employees, maintain payroll, and make lease and utility payments.

In October 2020, the Company submitted the loan forgiveness

application to the Lender requesting forgiveness for the full amount of the loan.

The Lender had 60 days from receipt of the loan forgiveness application to issue a decision to the SBA, and the SBA, subject to its review, would remit funds within

90 days after the Lender issues its decision to the SBA.

In June 2021, the Company was notified by the

Lender that the PPP Loan in the amount of $ 812,500 and accrued interest of $ 9,015 was fully forgiven;

and, as a result, the entire amount was derecognized on the Company’s financial statements, which was included as other income for the twelve months ended

December 31, 2021 on the accompanying statements of comprehensive loss.

The Company is required to maintain all necessary records for at least six years following the date of forgiveness, and the SBA

reserves the right to audit our fully forgiven PPP loan.

As of December 31, 2021, no amounts were outstanding under the PPP loan.

As of December 31, 2020, the PPP loan outstanding was $ 812,500 , and interest expense accrued in connection with this PPP loan was $ 5,654

and was included in accrued expenses on the accompanying balance sheets.

For the years ended December 31, 2021 and 2020, interest expense on the PPP loan was $ 0 and $ 5,654 , respectively.

Economic Injury Disaster Loan advance

In April 2020, the Company received the SBA Economic Injury

Disaster Loan advance (EIDL advance) of $ 10,000 .

This EIDL advance was originally included in notes payable since the SBA was required to

deduct the amount of any EIDL advance received by a PPP borrower from the PPP forgiveness payment remitted by SBA to the lender.

In December 2020, the Economic Aid to Hard-Hit Small Business, Nonprofits and Venues Act (Economic Aid Act) was signed

into law, which repealed the SBA requirement to deduct the amount of any EIDL advance received by a PPP borrower from the PPP forgiveness payment.

As a result of the Economic Aid Act, the Company recognized the EIDL advance as other income in

December 2020.

As of December 31, 2021 and December 31, 2020 no amounts were outstanding under the EIDL advance.

For the year ended December 31, 2021 and 2020, EIDL other income recognized was $ 0 and $ 10,000 , respectively.

Notes to Financial Statements

December 31, 2021 and 2020

Georgia Primary Bank (the Lender) that the unsecured loan in the amount of $ 812,500 , which was made pursuant to the PPP, and accrued

interest of $ 9,015 was fully forgiven;

and, as a result, the entire amount was derecognized on the Company’s financial statements,

which was included as other income for the twelve months ended December 31, 2021 on the accompanying statements of comprehensive loss.

The Company is required to maintain all necessary records for at least six years following the date of forgiveness, and the SBA reserves the right to audit the Company’s fully forgiven PPP loan.

As of December 31, 2022 and 2021, no amounts were outstanding under the PPP loan.

For the years ended December 31, 2022 and 2021, no interest expense on the PPP loan was recognized.

AFCO Credit Corporation (AFCO)

In the first quarter of 2021, the Company executed two Promissory Notes with AFCO (AFCO notes) to finance certain insurance premiums totaling $ 64,842 , requiring the Company to pay $ 16,210 in down payments and make monthly

installment payments.

The annual interest rate was 10.5 % and the monthly installment payments were $ 6,094 , which represented principal and

The final installment payments were paid in October 2021 .

In the second quarter of 2021, the Company executed another

Promissory Note with AFCO (AFCO note) to finance certain insurance premiums totaling $ 558,367 , requiring the Company to pay $ 111,673 in a down payment and make monthly installment payments.

The annual interest rate is 5.25 % and the monthly installment payment is $ 45,751 , which represents principal and interest.

The final installment payment is due April 2022 .

In June 2021, the Company executed a Promissory Note with AFCO

to finance certain insurance premiums totaling $ 558,367 , requiring the Company to pay $ 111,673 in a down payment and make monthly installment payments.

The annual interest rate was 5.25 % and the monthly installment payments were $ 45,751 , which represented principal and interest.

The final installment payment was paid April 2022 .

In June 2022, the Company executed another Promissory Note with

AFCO to finance certain insurance premiums totaling $ 465,380 , requiring the Company to pay $ 47,539 in a down payment and make monthly installment payments.

The annual interest rate is 5.7 % and the monthly installment payment is $ 47,539 , which represent principal and interest.

The final installment payment is due March of 2023 .

As of December 31, 2022 and December 31, 2021, the principal

1 unchanged sentence

respectively and is included in Notes payable – current portion in the accompanying balance sheets.

Interest expense in connection with the three

AFCO promissory notes was $ 10,775 and $ 0

the years ended December 31, 2021 and 2020, respectively.

A reconciliation of income tax expense at

the statutory federal income tax rate and income taxes as reflected in the financial statements is as follows as of December 31:

Interest expense in connection with the AFCO promissory notes was $ 10,572 and $ 10,775 the years ended December 31, 2022 and 2021, respectively.

The current tax provisions and deferred tax provisions as

reflected in the financial statements is as follows as of December 31:

Current federal taxes

Current state taxes

Current tax provision

Deferred federal taxes

Deferred state taxes

Deferred tax provision

Valuation allowance change

Total income tax expense provision

Notes to Financial Statements

December 31, 2022 and 2021

A reconciliation of income tax

expense at the statutory federal income tax rate and income taxes as reflected in the financial statements is as follows as of December 31:

Federal income tax at statutory federal rate

5 unchanged sentences

Effective tax rate

Deferred tax assets (liabilities)

consisted of the following as of December 31:

Deferred tax assets

(liabilities) consisted of the following as of December 31:

Deferred tax asset arising from:

1 unchanged sentence

Accrued expenses (vacation)

Property and equipment

Research and development expense capitalization

Research and development tax credits

8 unchanged sentences

Net deferred tax asset

income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, and the Company is required to reduce its

deferred tax assets by a valuation allowance if it is more likely than not that some or all of its deferred tax assets will not be realized.

Management must use judgment in assessing the potential need for a valuation allowance, which requires an

evaluation of both negative and positive evidence.

Deferred income taxes reflect the net

tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, and the Company is required to reduce its deferred tax assets by a valuation

allowance if it is more likely than not that some or all of its deferred tax assets will not be realized.

Management must use judgment in assessing the potential need for a valuation allowance, which requires an evaluation of both negative and

positive evidence.

The weight given to the potential effect of negative and positive evidence should be commensurate with the extent to which it can be objectively verified.

In determining the need for and amount

of the valuation allowance, if any, the Company assesses the likelihood that it will be able to recover its deferred tax assets using historical levels of income, estimates of future income and tax planning strategies.

As a result of historical

cumulative losses, the Company determined that, based on all available evidence, there was substantial uncertainty as to whether it will recover recorded net deferred taxes in future periods.

Accordingly, the Company recorded a valuation

allowance against all of its net deferred tax assets as of December 31, 2021 and 2020.

The change in valuation allowance was $ 2,012,112

and $ 1,337,524 for the years ended December 31, 2021 and 2020, respectively.

Notes to Financial Statements

December 31, 2021 and 2020

As of December 31, 2021

and 2020, respectively, the Company has $ 78,264,967 and $ 69,762,635 of federal net operating loss carry forwards and $ 2,407,689 and $ 2,169,132 of federal research and experimentation tax credits, respectively, and state net operating loss carry forwards of $ 7,774,956 and $ 5,962,200 , respectively.

In determining the need for and amount of the valuation allowance, if

any, the Company assesses the likelihood that it will be able to recover its deferred tax assets using historical levels of income, estimates of future income and tax planning strategies.

As a result of historical cumulative losses, the Company

determined that, based on all available evidence, there was substantial uncertainty as to whether it will recover recorded net deferred taxes in future periods.

Accordingly, the Company recorded a valuation allowance against all of its net

deferred tax assets as of December 31, 2022 and 2021.

The change in valuation allowance was $ 2,425,019 and $ 2,012,112 for the years ended December 31, 2022 and 2021, respectively.

Beginning on January 1, 2022, the Tax Cuts and Jobs Act, enacted in December 2017, eliminated the option to deduct research and

development expenditures in the current period and requires taxpayers to capitalize and amortize U.S.-based and non-U.S.

based research and development expenditures over five and fifteen years, respectively.

This legislation does not impact the

Company’s current tax obligations.

As of December 31, 2022 and 2021,

respectively, the Company has $ 82,500,567 and $ 78,264,967 of federal net operating loss carry forwards and $ 2,838,559 and $ 2,407,689 of federal research and experimentation tax credits, respectively, and state net operating loss carry forwards of $ 9,522,312 and $ 7,774,956 , respectively.

The utilization of such net operating loss carryforwards and the realization of tax benefits in future years depend predominately upon having taxable income.

1 unchanged sentence

Company’s ownership may result in a limitation on the amount of net operating loss carry forwards and tax credit carry forwards that may be used in future years.

The Company’s net

operating losses may be subject to Section 382 of the Internal Revenue Code which provide for a limitation on the annual use of net operating losses following certain ownership changes that could limit the Company’s ability to utilize these

carryforwards.

The Company has completed an analysis covering the period February 19, 2004 through December 31, 2018, to determine if such ownership changes have occurred and concluded it was more likely than not that there were changes in

ownership during the period, with the most recent change of ownership occurring on December 16, 2016.

Further analyses will be performed prior to recognizing the benefits of any losses or credits in the financial statements, and the Company is in

the process of determining the limitations that Section 382 will have on the Company’s net operating loss carryforwards and research credits.

In general, the annual use limitation equals the aggregate value of the Company’s stock at the time of

the ownership change multiplied by a specified tax-exempt interest rate.

The following schedule

indicates the expiration year, as of December 31, for the Company’s federal net operating loss carryforwards available to future years without taking into account any Section 382 limitations as of December 31, 2021:

The FASB issued authoritative guidance on accounting for

uncertainty in income taxes, which clarifies the accounting for income taxes, by prescribing a minimum recognition threshold that a tax position is required to meet before recognition in the financial statements.

The guidance also provides

direction on recognition, measurement, classification, interest, and penalties, accounting in interim periods, disclosure, and transition.

Notes to Financial Statements

December 31, 2022 and 2021

The Company’s net operating losses may be

subject to Section 382 of the Internal Revenue Code which provide for a limitation on the annual use of net operating losses following certain ownership changes that could limit the Company’s ability to utilize these carryforwards.

The Company has

completed an analysis covering the period February 19, 2004 through December 31, 2018, to determine if such ownership changes have occurred and concluded it was more likely than not that there were changes in ownership during the period, with the

most recent change of ownership occurring on December 16, 2016.

Further analyses will be performed prior to recognizing the benefits of any losses or credits in the financial statements, and the Company is in the process of determining the

limitations that Section 382 will have on the Company’s net operating loss carryforwards and research credits.

In general, the annual use limitation equals the aggregate value of the Company’s stock at the time of the ownership change multiplied

by a specified tax-exempt interest rate.

The following schedule indicates the expiration year, as of December 31, for the Company’s federal net

operating loss carryforwards available to future years without taking into account any Section 382 limitations as of December 31, 2022:

The FASB issued authoritative guidance on accounting for uncertainty in income

taxes, which clarifies the accounting for income taxes, by prescribing a minimum recognition threshold that a tax position is required to meet before recognition in the financial statements.

The guidance also provides direction on recognition,

measurement, classification, interest, and penalties, accounting in interim periods, disclosure, and transition.

Management has determined there are no uncertain tax positions.

Accordingly, these financial statements do

not include any adjustments or disclosures related to uncertain tax positions.

Redeemable Convertible Preferred Stock and Stockholders’ Equity

Accordingly, these financial statements do not include any adjustments

or disclosures related to uncertain tax positions.

Stockholders’ Equity

The Company’s Board of Directors approved in January 2017 the

Tenth Amended and Restated Certificate of Incorporation authorizing the Company to issue for all classes of stock 169,000,000 shares at

$ 0.001 par value per share, of which 95,853,558

Tenth Amended and Restated Certificate of Incorporation authorizing the Company to issue for all classes of stock 169,000,000 shares at $ 0.001 par value per share, of which 95,853,558

shares were designated Common Stock and 73,146,442 shares were designated Preferred Stock.

2 unchanged sentences

were automatically converted into one share of common stock (reverse stock split);

thus, the Company effected a 1-for- 9 reverse stock

split of its common stock.

thus, the Company effected a 1-for- 9 reverse stock split

of its common stock.

The par value and the authorized shares of the common stock were not adjusted as a result of the reverse stock split.

The reverse stock split resulted in an adjustment to the convertible preferred stock conversion price

to reflect a proportional decrease in the number of shares of common stock to be issued upon conversion.

The reverse stock split resulted in an adjustment to the convertible preferred stock conversion price to

reflect a proportional decrease in the number of shares of common stock to be issued upon conversion.

The accompanying financial statements and notes to the financial statements give retroactive effect to the reverse stock split for all periods

4 unchanged sentences

Offering costs incurred by the company were $ 2,016,143 ,

which include legal expenses incurred and paid by our underwriters of $ 425,000 .

Immediately prior to the closing of the IPO, all our

shares of our convertible Series A preferred stock and our redeemable convertible Series B and Series C preferred stock automatically converted into 8,116,343

which include legal expenses incurred and paid by the underwriters of $ 425,000 .

Immediately prior to the closing of the IPO, all of the

convertible Series A preferred stock and redeemable convertible Series B and Series C preferred stock automatically converted into 8,116,343

shares of common stock.

The Company filed an Eleventh Amended and Restated Certificate

of Incorporation (the “Amended and Restated Certificate”) with the Secretary of State of the State of Delaware in connection with the completion of the IPO on June 22, 2021.

The Amended and Restated Certificate amends and restates the Company’s

existing certificate of incorporation in its entirety to, among other things:

The Company filed an Eleventh Amended and Restated Certificate of

Incorporation (the “Amended and Restated Certificate”) with the Secretary of State of the State of Delaware in connection with the completion of the IPO on June 22, 2021.

The Amended and Restated Certificate amends and restates the Company’s existing

certificate of incorporation in its entirety to, among other things:

(i) authorize 200,000,000 shares of common stock;

eliminate all references to the previously-existing series of preferred stock (Series A, B and C);

and (iii) authorize 10,000,000 shares

of undesignated preferred stock that may be issued from time to time by the Board in one or more series.

The holders of the common stock shall have the exclusive right

to vote for the election of directors and on all other matters requiring stockholder action, each outstanding share entitling the holder thereof to one

(ii) eliminate all

references to the previously-existing series of preferred stock (Series A, B and C);

and (iii) authorize 10,000,000 shares of undesignated

preferred stock that may be issued from time to time by the Board in one or more series.

In July 2022, the Company entered into an Equity Distribution Agreement (the “Equity Distribution

Agreement”) with Piper Sandler & Co.

(“Piper Sandler” or the “Sales Agent”) and filed a related Prospectus establishing an “at-the-market” facility, pursuant to which the Company may offer and sell shares of common stock having an aggregate

offering price of up to $ 8,800,000 from time to time through the Sales Agent pursuant to the Prospectus.

As of December 31, 2022, 51,251 shares of common stock had been sold under the Equity Distribution Agreement.

The holders of the common stock shall have the exclusive right to

vote for the election of directors and on all other matters requiring stockholder action, each outstanding share entitling the holder thereof to one

vote on each matter properly submitted to the stockholders of the Company for their vote;

provided, however, that, except as otherwise required by law, holders of common stock, as such, shall not be entitled to vote on any amendment to the Amended

and Restated Certificate (or on any amendment to a certificate of designations of any series of preferred stock) that alters or changes the powers, preferences, rights or other terms of one or more outstanding series of preferred stock if the

holders of such affected series of preferred stock are entitled to vote, either separately or together with the holders of one or more other such series, on such amendment pursuant to this Amended and Restated Certificate (or pursuant to a

certificate of designations of any series of preferred stock).

Dividends may be declared and paid or set apart for payment

upon the common stock out of any assets or funds of the Company legally available for the payment of dividends, but only when and as declared by the Board of Directors or any authorized committee thereof.

of such affected series of preferred stock are entitled to vote, either separately or together with the holders of one or more other such series, on such amendment pursuant to this Amended and Restated Certificate (or pursuant to a certificate of

designations of any series of preferred stock).

Dividends may be declared and paid or set apart for payment upon

the common stock out of any assets or funds of the Company legally available for the payment of dividends, but only when and as declared by the Board of Directors or any authorized committee thereof.

In the event of our liquidation or dissolution, the holders of

common stock are entitled to receive proportionately our net assets available for distribution to stockholders after the payment of all debts and other liabilities and subject to the prior rights of any outstanding preferred stock.

common stock have no preemptive, subscription, redemption, or conversion rights.

common stock are entitled to receive proportionately the Company’s net assets available for distribution to stockholders after the payment of all debts and other liabilities and subject to the prior rights of any outstanding preferred stock.

of common stock have no preemptive, subscription, redemption, or conversion rights.

Convertible Preferred Stock

As of December 31, 2020, the Convertible Preferred Stock

consisted of the following:

Series A Preferred:

Series A-1 Convertible Preferred

Series A-2 Preferred

Series A-3 Preferred

Series A-4 Preferred

Series A-5 Preferred (formerly, Preferred Stock B-1)

Series A-6 Preferred (formerly, Preferred Stock C-1)

Series A-7 Preferred (formerly, Preferred Stock D-1)

In June 2021, the 17,210,609 shares of convertible preferred stock outstanding were automatically converted into 1,912,332 shares of common stock after taking into account the 1-for- 9

In June 2021, 17,210,609 shares of convertible preferred stock outstanding were automatically converted into 1,912,332 shares of common stock after taking into account the 1-for- 9

reverse stock split.

As of December 31, 2022, no shares of convertible preferred stock have been issued and/or outstanding, and no dividends have been declared or paid since inception.

Notes to Financial Statements

December 31, 2021 and 2020

Redeemable Convertible Preferred Stock

As of December 31, 2020, the Redeemable Convertible Preferred

Stock consisted of the following:

Series B Preferred

Series C Preferred

In June 2021, the 55,835,833 shares of redeemable convertible preferred stock outstanding were automatically converted into 6,204,011 shares of common stock after taking into account the 1-for- 9

In June 2021, 55,835,833 shares of redeemable convertible preferred stock outstanding were automatically converted into 6,204,011 shares of common stock after taking into account the 1-for- 9

reverse stock split.

As of December 31, 2022, no shares of redeemable convertible preferred stock have been issued and/or outstanding, and no dividends have been declared or paid since inception.

Notes to Financial Statements

December 31, 2022 and 2021

Preferred Stock

Under the terms of our Amended and Restated Certificate, the

Under the terms of the Amended and Restated Certificate, the

Company’s Board of Directors is authorized to direct the Company to issue shares of preferred stock in one or more series without stockholder approval.

Our Board of Directors has the discretion to determine the rights, preferences, privileges and

The 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.

The purpose of authorizing our Board of Directors to issue

The purpose of authorizing the Board of Directors to issue

preferred stock and determine its rights and preferences is to eliminate delays associated with a stockholder vote on specific issuances.

The issuance of preferred stock, while providing flexibility in connection with possible acquisitions, future

financings, and other corporate purposes, could have the effect of making it more difficult for a third-party to acquire, or could discourage a third-party from seeking to acquire, a majority of our outstanding voting stock.

As of December 31, 2022

2021, no shares of preferred stock are outstanding.

and 2021, no shares of preferred stock are outstanding.

As of December 31, 2022, the Company has warrants outstanding to purchase

shares of common stock, which are all exercisable in whole or in part, with expiration dates as follows:

Expiration date

December 2026

In May 2022, a warrant to purchase 11,112 shares of common stock expired.

As of December 31, 2022, no dividends have been declared or paid since inception.

1 unchanged sentence

Equity Incentive Plans

Stock Option Plans – Prior to our IPO

Prior to our IPO in June 2021, the Company maintained two equity incentive plans, the 2004 Stock Incentive Plan, as amended, or 2004 Plan, and the 2015 Stock-Based Incentive Compensation Plan, or 2015 Plan,

which provided our employees, non-employee directors, consultants and independent contractors the opportunity to participate in the equity appreciation of our business through the receipt of stock options to purchase shares of our common stock.

grants ceased being made under the 2004 Plan upon the adoption of the 2015 Plan;

Stock Option Plans – Prior to the IPO

Prior to the IPO in June 2021, the Company maintained two equity incentive plans, the 2004 Stock Incentive Plan, as amended, or 2004 Plan, and the 2015 Stock-Based Incentive Compensation Plan, or 2015 Plan,

which provided the Company’s employees, non-employee directors, consultants and independent contractors the opportunity to participate in the equity appreciation of the business through the receipt of stock options to purchase shares of common

New grants ceased being made under the 2004 Plan upon the adoption of the 2015 Plan;

however, outstanding stock options under the 2004 Plan may continue to be exercised in accordance with their terms.

We adopted the 2015 Plan in April 2015, which

contains substantially similar terms and conditions as the 2004 Plan.

The 2015 Plan initially had 1,176,681 shares of our common stock

We adopted the 2015 Plan in April 2015,

which contains substantially similar terms and conditions as the 2004 Plan.

The 2015 Plan initially had 1,176,681 shares of common stock

reserved for issuance under the 2015 Plan and was administered by the compensation committee of the Board of Directors.

Upon the closing of our IPO, no further awards will be made under the 2015 Plan;

Upon the closing of the IPO, no further awards will be made under the 2015 Plan;

however, outstanding stock options under the

2 unchanged sentences

December 31, 2022 and 2021.

Stock Option Plans – Post our IPO

In June 2021, in connection with the IPO, our 2021 Equity

Incentive Plan (“2021 Plan”) became effective, which was adopted by our Board of Directors in February 2021 and our stockholders approved the 2021 Plan in March 2021.

Stock Option Plans – Post the IPO

In June 2021, in connection with the IPO, the 2021 Equity Incentive Plan (2021 Plan) became effective, which was adopted by the Board

of Directors in February 2021 and the stockholders approved the 2021 Plan in March 2021.

The 2021 Plan is administered by our compensation committee.

effectiveness of the 2021 Plan, no new grants will be awarded under our 2015 Stock-Based Incentive Compensation Plan.

Under the 2021 Plan, the Company may grant awards in respect of

our shares of common stock to our employees, consultants, and our non-employee directors pursuant to option awards, stock appreciation right, or SAR, awards, restricted stock awards, restricted stock unit, or RSU, awards, performance stock awards,

performance stock unit, or PSU, awards, and other stock-based awards.

Upon the effectiveness of the 2021 Plan, no new grants will be awarded under our 2015 Stock-Based Incentive Compensation Plan.

Notes to Financial Statements

December 31, 2022 and 2021

Under the 2021 Plan, the Company may grant awards in respect of

shares of common stock to employees, consultants, and non-employee directors pursuant to option awards, stock appreciation right, or SAR, awards, restricted stock awards, restricted stock unit, or RSU, awards, performance stock awards, performance

stock unit, or PSU, awards, and other stock-based awards.

The total number of shares of common stock available for awards

under the 2021 Plan is 1,111,111 , provided that such number shall be automatically increased on each January 1, beginning on January 1,

2022, by 4 % of the outstanding number of shares of our common stock on the immediately preceding December 31 or such lesser number of

shares as determined by our Board of Directors.

The aggregate number of shares of our common stock that will be available for issuance under awards granted pursuant to the 2021 Plan shall also be increased by the number of shares underlying the

portion of an award granted under our 2015 Plan that is cancelled, terminated or forfeited or lapses after the effective date of the 2021 Plan.

No more than 1,111,111 shares of common stock issued under the 2021 Plan may be issued pursuant to the exercise of incentive stock options (ISO), provided that such number shall be automatically increased on each January 1,

beginning on January 1, 2022, by the lesser of 4 % of the outstanding number of shares of our common stock on the immediately preceding

December 31 or 555,555 shares of common stock.

Shares of common stock issued by us in connection with the assumption or substitution of

outstanding grants or under certain stockholder approved plans from an acquired company shall not reduce the number of shares of common stock available for awards under the 2021 Plan.

Shares of common stock underlying the portion of an award that

is forfeited or otherwise terminated for any reason whatsoever, in any case, without the issuance of shares of common stock, will be added back to the number of shares of common stock available for grant under the 2021 Plan.

No non-employee

director may be granted awards under the 2021 Plan in any one calendar year covering a number of shares of common stock that have a fair market value on the grant date in excess of $ 350,000 in the first calendar year of such non-employee director’s initial service as a non-employee director and $ 200,000 in any other calendar year of such non-employee director’s service as a non-employee director.

2022, by 4 % of the outstanding number of shares of common stock on the immediately preceding December 31 or such lesser number of shares

as determined by the Board of Directors.

The aggregate number of shares of our common stock that will be available for issuance under awards granted pursuant to the 2021 Plan shall also be increased by the number of shares underlying the portion

of an award granted under the 2015 Plan that is cancelled, terminated or forfeited or lapses after the effective date of the 2021 Plan.

No more than 1,111,111

shares of common stock issued under the 2021 Plan may be issued pursuant to the exercise of incentive stock options (ISO), provided that such number shall be automatically increased on each January 1, beginning on January 1, 2022, by the lesser of

4 % of the outstanding number of shares of common stock on the immediately preceding December 31 or 555,555 shares of common stock.

Shares of common stock issued by us in connection with the assumption or substitution of outstanding grants or under

certain stockholder approved plans from an acquired company shall not reduce the number of shares of common stock available for awards under the 2021 Plan.

Shares of common stock underlying the portion of an award that is forfeited or otherwise

terminated for any reason whatsoever, in any case, without the issuance of shares of common stock, will be added back to the number of shares of common stock available for grant under the 2021 Plan.

No non-employee director may be granted awards

under the 2021 Plan in any one calendar year covering a number of shares of common stock that have a fair market value on the grant date in excess of $ 350,000

in the first calendar year of such non-employee director’s initial service as a non-employee director and $ 200,000 in any other calendar

year of such non-employee director’s service as a non-employee director.

Options granted under the 2021 Plan may be either ISOs or

12 unchanged sentences

Balances at December 31, 2022

Notes to Financial Statements

December 31, 2022 and 2021

options granted under the stock option plans for the years ended December 31 2022 and 2021 were as follows:

The intrinsic value of options exercised during the years ended

2 unchanged sentences

The intrinsic values represent the dollar value of the exercised stock options whereby the fair market value of the underlying common stock exceeded the exercise price of the stock option as of the exercise date.

Notes to Financial Statements

December 31, 2021 and 2020

The options outstanding and vested and currently

2 unchanged sentences

Options vested and exercisable

Stock‑Based Compensation for Nonemployees

Stock‑based compensation expense related to stock options

granted to nonemployees is recognized on a straight-line basis as the options vest.

The Company believes that the value of the stock options is more reliably measurable than the fair value of the services received.

For the years ended December 31,

2021 and 2020, no options were granted to nonemployees.

Stock‑based compensation expense recorded for options granted

to nonemployees for the years ended December 31, 2021 and 2020 was $ 2,296 and $ 4,714 , respectively.

Stock‑Based Compensation Associated with Awards to Employees

Stock‑based compensation expense recognized is based on the

value of the portion of stock‑based awards that is ultimately expected to vest on a straight-line basis.

Stock‑based compensation expense recognized in the Company’s statements of comprehensive loss during the years ended December 31, 2021 and 2020

includes compensation expense for stock‑based awards based on the fair value estimated in accordance with the provisions of ASC 718, Compensation – Stock Compensation.

For the years ended December 31, 2021 and 2020, no options were granted to employees.

Stock‑based compensation expense recorded for options granted to employees for the years ended December 31,

2021 and 2020 was $ 191,070 and $ 313,926 ,

respectively.

December 31, 2022, the total number of shares of common stock reserved for future awards under the 2021 Plan is 1,325,247 .

Inducement Grants

For the year ended December 31, 2022, the Company awarded,

outside the 2021 Plan, two stock option grants for the right to purchase a total of 150,000 shares of common stock (inducement grants), which were approved by the Compensation Committee.

The weighted average exercise price was $ 2.42 .

The inducement grants will vest in equal installments over four years provided the employee remains employed by the Company on the vesting date.

As of December 31, 2022, awards to purchase 150,000 options are outstanding, none are exercisable, and the weighted

average remaining life is 9.4 years.

The Company uses the Black‑Scholes option pricing model to

determine the fair value of stock awards granted to employee and nonemployees.

The determination of the fair value of share‑based payment awards granted using a pricing model is affected by our stock price as well as the assumptions regarding a

number of complex and subjective variables as follows:

determine the fair value of stock awards granted to employees and nonemployees.

The determination of the fair value of share‑based payment awards granted using a pricing model is affected by the Company’s stock price as well as the assumptions

regarding a number of complex and subjective variables as follows:

Expected Term

19 unchanged sentences

The Company accounts for forfeitures as they occur.

The following table shows stock-based compensation expense related to vested stock option grants to

employees, directors and nonemployees by financial statement line item on the accompanying statement of comprehensive loss for the year ended December 31:

The Black-Scholes weighted average assumptions for all stock

option awards granted during 2022 were as follows:

2021 Equity Plan

Inducement Grants

Fair Value of Awards

Expected term (in years)

Risk‑free interest rate

Dividend yield

Expected volatility

Employee Stock Purchase Plan (ESPP)

In June 2021, in connection with the IPO, the ESPP became

effective which was adopted by the Board of Directors in February 2021 and the stockholders approved the 2021 ESPP Plan in March 2021.

The ESPP is administered by the compensation committee.

The total number of shares of common stock available for

purchase under the ESPP is 166,666 , provided that such number is automatically increased on January 1 of each calendar year, from

January 1, 2022 through January 1, 2031 by the least of (i) 1.0 % of the total number of shares of common stock outstanding on December

31 of the immediately preceding calendar year, (ii) 222,222 shares of common stock or (iii) a number determined by the board of

directors that is less than the foregoing clauses (i) and (ii).

Under the ESPP, the Company may specify offerings with

durations of not more than 27 months and may specify shorter purchase periods within each offering.

Each offering will have one or more purchase dates on which shares of common stock will be purchased for employees participating in the offering.

An offering may be terminated

under certain circumstances.

No employee may purchase more than 12,254 shares of common stock under the ESPP during any offering period.

Unless otherwise determined by the board of directors, shares of common stock will be purchased for accounts of employees participating in the ESPP at a price per share equal to the lower of (i) 85 % of the fair market value of a share of common stock on the last date of an offering period or (ii) 85 % of the fair market value of a share of common stock on the first day of such offering period.

As December 31, 2022, 4,843 shares of common stock have been purchased under the ESPP, and the total number of shares of common stock reserved for future awards under the

ESPP is 279,864 .

Stock‑Based Compensation Expense

Stock‑based compensation expense

recognized is based on the value of the portion of stock option awards that is ultimately expected to vest on a straight-line basis.

Stock‑based compensation expense recognized in the Company’s statements of comprehensive loss during the years

ended December 31, 2022 and 2021 includes compensation expense for stock‑based awards based on the fair value estimated in accordance with the provisions of ASC 718, Compensation – Stock Compensation.

Notes to Financial Statements

December 31, 2022 and 2021

The following table shows the stock-based compensation expense related to vested stock option grants to employees and nonemployees awarded

under the stock plans and inducement grants by financial statement line item on the accompanying statement of comprehensive loss:

Research and development

5 unchanged sentences

The $ 594,907 of unrecognized expense is expected to be recognized over a weighted average period of 2.9 years.

Employee Stock Purchase Plan (“ESPP”)

In June 2021, in connection with the IPO, our ESPP became

effective which was adopted by our Board of Directors in February 2021 and our stockholders approved the 2021 ESPP Plan in March 2021.

The ESPP is administered by our compensation committee.

The total number of shares of our common stock available for

purchase under the ESPP is 166,666 , provided that such number is automatically increased on January 1 of each calendar year, from

January 1, 2022 through January 1, 2031 by the least of (i) 1.0 % of the total number of shares of our common stock outstanding on

December 31 of the immediately preceding calendar year, (ii) 222,222 shares of our common stock or (iii) a number determined by our

board of directors that is less than the foregoing clauses (i) and (ii).

Under the ESPP, the Company may specify offerings with

durations of not more than 27 months and may specify shorter purchase periods within each offering.

Each offering will have one or more purchase dates on which shares of our common stock will be purchased for employees participating in the offering.

An offering may be

terminated under certain circumstances.

No employee may purchase more than 12,254 shares of our common stock under the ESPP during any

offering period.

Unless otherwise determined by our board of directors, shares of common stock will be purchased for accounts of employees participating in the ESPP at a price per share equal to the lower of (i) 85 % of the fair market value of a share of our common stock on the last date of an offering period or (ii) 85 % of the fair market value of a share of our common stock on the first day of such offering period.

As December 31, 2021, no shares of our common stock have been purchased under the ESPP.

Retirement Plan

The Company has a 401(k) defined contribution plan

covering substantially all full‑time employees, meeting certain eligibility requirements.

The Company has a 401(k) defined contribution

plan covering substantially all full‑time employees, meeting certain eligibility requirements.

The Company has no required matching or other contribution requirements.

2 unchanged sentences

Related‑Party Transactions

During the years ended December 31, 2021 and 2020, there

were no related-party transactions.

Notes to Financial Statements

December 31, 2021 and 2020

During the years ended December 31, 2022 and

2021, there were no related-party transactions.

Net Loss per Share Attributable to Common Stockholders

The following table sets forth the

computation of the basic and diluted net loss per share for the years ended December 31:

The following table sets forth

the computation of the basic and diluted net loss per share for the years ended December 31:

Net loss attributable to common stockholders, basic & diluted

1 unchanged sentence

Net loss per share attributable to common stockholders, basic and diluted

The following potentially dilutive

securities have been excluded from the computations of diluted weighted average shares outstanding because they would be anti-dilutive for the years ended December 31:

Convertible preferred stock outstanding

The following potentially

dilutive securities have been excluded from the computations of diluted weighted average shares outstanding because they would be anti-dilutive for the years ended December 31:

Options to purchase common stock

Warrants to purchase to common stock

Warrants to purchase common stock

Total potential shares

1 unchanged sentence

Not applicable.

Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management has evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K.

Based on this

evaluation, and the information described above in this Item 9A, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective at December 31, 2021 due to the material

weakness described below.

Management’s Report on Internal Control Over Financial Reporting

As required by Rule 13a-15(c) promulgated under the Exchange Act, our management, with the participation of our Principal Executive Officer and

Principal Financial Officer, evaluated the effectiveness of our internal control over financial reporting as of December 31, 2021.

Management’s assessment was based on criteria set forth by the Committee of Sponsoring Organizations of the

Treadway Commission in Internal Control - Integrated Framework (2013 Framework) (“COSO”).

Based on management’s assessment, management has concluded that our internal control over financial reporting was not effective as of December 31,

2021 due to the material weakness in our internal control over financial reporting.

The material weakness identified that we did not have formalized financial reporting processes and policies in place to ensure that risks are properly

assessed, controls are properly designed, and internal controls are properly monitored.

We have concluded that this material weakness arose because we did not have the necessary business processes, personnel, and related internal controls

necessary to satisfy the accounting and financial reporting requirements of a public company.

Planned Remediation of Material Weakness

To address our material weakness, we added accounting personnel, including a Chief Financial Officer hired on February 28, 2022, which will allow us to implement and enhance our formalized

policies and procedures regarding internal control over financial processes.

We intend to continue to take steps to remediate the material weakness described above through hiring additional qualified accounting and financial reporting

personnel, further evolving our accounting processes, and monitoring of our controls.

We will not be able to fully remediate this material weakness until these steps have been completed and have been operating effectively for a sufficient

period of time.

Changes in Internal Control over Financial Reporting

Other than the remediation efforts described above in this Item 9A, there has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under

the Exchange Act) during the quarter ended December 31, 2021, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f).

management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or internal control over financial reporting will prevent all errors and all fraud.

system, no matter how well designed and implemented, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met.

Further, the design of a control system must reflect the fact that there are

resource constraints, and the benefits of controls must be considered relative to their costs.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues

within a company are detected.

The inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple errors or mistakes.

Controls can also be circumvented by the

individual acts of some persons, by collusion of two or more people, or by management override of the controls.

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.

Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may

occur and may not be detected.

Other Information.

Not applicable.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Not applicable.

Directors, Executive Officers and Corporate Governance.

The information required by this item is incorporated herein by reference to our definitive proxy statement for our 2022 Annual Meeting of Stockholders under the captions

“Election of Directors,” “Officers and Directors” and “Corporate Governance.”

Code of Ethics

The board of directors has adopted a Code of Ethics applicable to all of our directors, officers and employees, including our principal executive officer, principal financial

officer and principal accounting officer.

A copy of the Code of Ethics is available at our website www.femasys.com.

Executive Compensation.

Compensation of Directors and Executive Officers

The information required by this item is incorporated herein by reference to our definitive proxy statement for our 2022 Annual Meeting of Stockholders under the caption

“Compensation of Executive Officers and Directors - Executive Compensation.”

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The information required by this item with respect to the security ownership of certain beneficial owners and the security ownership of management is incorporated herein by

reference to our definitive proxy statement for our 2022 Annual Meeting of Stockholders under the caption “Security Ownership of Certain Beneficial Owners and Management.”

Equity compensation plans

The information required by this item with respect to the equity compensation plans is incorporated herein by reference to this annual report on Form 10-K, Item 5, under the

caption “Equity compensation plans.”

Certain Relationships and Related Transactions and Director Independence.

The information required by this item with respect to certain relationships and related transactions is incorporated herein by reference to our definitive proxy statement for

our 2022 Annual Meeting of Stockholders under the caption “Certain Relationships and Related-Person Transactions.” The information required by this item with respect to director independence is incorporated herein by reference to our

definitive proxy statement for our 2022 Annual Meeting of Stockholders under the caption “Corporate Governance — Director Independence.”

Principal Accounting Fees and Services.

The information required by this item is incorporated herein by reference to our definitive proxy statement for our 2022 Annual Meeting of Stockholders under the captions

“Ratification of Appointment of our Independent Registered Public Accounting Firm” and “Audit Committee Matters — Audit and Other Fees.”

Incorporated by Reference

Description of Document

Schedule/Form

Eleventh Amended and Restated Certificate of Incorporation of Femasys Inc.

June 22, 2021

Amended and Restated Bylaws of Femasys Inc.

June 22, 2021

Description of the Registrant’s Securities

Form of Certificate of Common Stock

2021 Equity Incentive Plan, and forms of agreements thereunder

2021 Employee Stock Purchase Plan

Amended and Restated Employment Agreement, by and between Femasys Inc.

and Kathy Lee-Sepsick

June 14, 2021

Amended and Restated Employment Agreement, by and between Femasys Inc.

and Daniel Currie

June 14, 2021

Employment Agreement, dated February 15, 2010, by and between Femasys Inc.

and Gary Thompson

June 14, 2021

Non-Employee Director Compensation Policy

June 14, 2021

Form of Indemnification Agreement between Femasys Inc.

and its directors and officers

June 14, 2021

Master Services Agreement and Statement of Work for consulting services, effective August 12, 2021, by and between Femasys Inc.

and Bespoke Medical Affairs Solutions, LLC

November 12, 2021

Employment Agreement, dated as of February 28, 2022, between Femasys Inc.

and Dov Elefant

February 24, 2022

Form of Inducement Stock Option Agreement

February 24, 2022

Consent of KPMG LLP

Power of Attorney (included on signature page)

Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Principal Executive Officer Pursuant to 18 U.S.C.

Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Certification of Principal Financial Officer Pursuant to 18 U.S.C.

Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)

Inline XBRL Taxonomy Extension Schema Document

Inline XBRL Taxonomy Extension Calculation Linkbase Document

Inline XBRL Taxonomy Extension Definition Linkbase Document

Inline XBRL Taxonomy Extension Label Linkbase Document

Inline XBRL Taxonomy Extension Presentation Linkbase Document

Cover Page Interactive Data File (formatted as inline XRBL and contained in Exhibit 101)

Form 10-K Summary.

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City

of Suwanee, State of Georgia, on this 24 day of March 2022.

March 24, 2022

/s/ Kathy Lee-Sepsick

Kathy Lee-Sepsick

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Kathy Lee-Sepsick and Daniel

Currie, and each of them as his or her true and lawful attorneys-in- fact and agents, each with the full power of substitution, for him or her and in his or her name, place or stead, in any and all capacities, to sign any and all amendments

to this report, and to file the same, with exhibits thereto and other documents in connection therewith with the Securities and Exchange Commission, hereby ratifying and confirming all that said attorneys-in-fact, and each of them, or his

or her substitute or substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities 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.

/s/ Kathy Lee-Sepsick

March 24, 2022

Kathy Lee-Sepsick

Chair of the Board of Directors, President and

Chief Executive Officer (principal executive officer)

/s/ Dov Elefant

March 24, 2022

Chief Financial Officer (principal financial and accounting officer)

/s/ John Adams, Jr.

March 24, 2022

John Adams, Jr.

/s/ John Dyett

March 24, 2022

/s/ Charles Larsen

March 24, 2022

Charles Larsen

/s/ Anne Morrissey

March 24, 2022

Anne Morrissey

/s/ Wendy Perrow

March 24, 2022

/s/ Edward Uzialko, Jr.

March 24, 2022

Edward Uzialko, Jr.

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data