What changed in this filing

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Item 1. Financial Statements

2023-11-13 compared with 2023-08-11 · 227 added, 81 removed, 337 unchanged (48% of the section changed)

2 unchanged sentences

Condensed Balance Sheets

September 30,

Current Assets

7 unchanged sentences

Security deposits, non-current

Intangible assets

Operating lease right-of-use asset

6 unchanged sentences

Operating lease liabilities - current portion

Notes payable - current portion, net of debt discount of $ 91,621 and $ 33,885 as of June 30, 2023 and December 31, 2022, respectively

Convertible notes payable - current portion, net of dedt discount of $ 0 and $ 33,885 as of June 30, 2023 and December 31, 2022, respectively

Notes payable - current portion, net of debt discount of $ 327,217 and $ 33,885 as of September 30, 2023 and December 31, 2022, respectively

Convertible notes payable - current portion, net of debt discount of $ 0 and $ 33,885 as of September 30, 2023 and December 31, 2022, respectively

Total Current Liabilities

Operating lease liabilities - non-current portion

Notes payable - non-current portion, net of debt discount of $ 1,120,372 and $ 813,229 as of June 30, 2023 and December 31, 2022, respectively

Convertible notes payable - non-current portion, net of debt discount of $ 507,270 and $ 813,229 as of June 30, 2023 and December 31, 2022, respectively

Notes payable - non-current portion, net of debt discount of $ 754,919 and $ 813,229 as of September 30, 2023 and December 31, 2022, respectively

Convertible notes payable - non-current portion, net of debt discount of $ 452,920 and $ 813,229 as of September 30, 2023 and December 31, 2022, respectively

Total Liabilities

2 unchanged sentences

Preferred stock, $ 0.0001 par value, 6,000,000 shares authorized;

0 shares issued and outstanding as of June 30, 2023 and December 31, 2022

0 shares issued and outstanding as of September 30, 2023 and December 31, 2022

Common stock, $ 0.0001 par value, 90,000,000 shares authorized;

38,169,398 and 36,668,980 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively

42,898,246 and 36,668,980 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively

Additional paid-in capital

8 unchanged sentences

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

September 30,

Operating Income

Cost of revenue

Operating Expenses:

8 unchanged sentences

Other Income (Expense):

Other income, net

Other (expense) income, net

Interest expense

1 unchanged sentence

Interest income

Total Other Expense

( 1,354,067 )

2 unchanged sentences

( 19,293,959 )

( 21,887,761 )

Net Loss Per Share - Basic and Diluted

Weighted Average Number of Common Shares Outstanding - Basic and Diluted

Shares Outstanding - Basic and Diluted

The accompanying notes are an integral part of these condensed financial statements.

1 unchanged sentence

Condensed Statements of Changes in Stockholders’ Equity

For the Three and Six Months Ended June 30, 2023

For the Three and Nine Months Ended September 30, 2023

Stockholders’

18 unchanged sentences

( 130,185,689 )

Issuance of common stock and warrants in registered direct offering [3][7]

Issuance of common stock as consideration for licensing agreement [4]

Issuance of common stock in At the Market offering [5]

Warrant modification - incremental value (6)

Warrant modification - in issuance costs for registered direct offering (7)

( 1,738,700 )

Stock-based compensation

( 7,338,733 )

Balance - September 30, 2023

( 137,524,422 )

Includes gross proceeds of $ 3,607,827 less total issuance costs of $ 108,235 .

Includes gross proceeds of $ 415,588 less total issuance costs of $ 12,468 .

For the Three and Six Months Ended June 30, 2022

Includes gross proceeds of $ 11,977,468 less total cash issuance costs of $ 1,091,354 .

Shares issued as partial consideration for License Agreement with Formosa Pharmaceuticals Inc.

Includes gross proceeds of $ 100,449 less total issuance costs of $ 3,013 .

Registered direct offering included modification of warrant originally granted in the March 2022 offering.

[7] Non-cash warrant modification issuance costs related to the registered direct offering of $ 1,738,700 are shown on a separate line item.

The accompanying notes are an integral part of these condensed financial statements.

EYENOVIA, INC.

Condensed Statements of Changes in Stockholders’ Equity

For the Three and Nine Months Ended September 30, 2022

Stockholders’

16 unchanged sentences

( 104,798,071 )

Issuance of common stock in At the Market offering [3]

Stock-based compensation

Issuance of common stock related to vested restricted stock units

( 7,308,996 )

Balance - September 30, 2022

( 112,107,067 )

Includes gross proceeds of $ 14,981,299 less total issuance costs of $ 83,391 .

Includes gross proceeds of $ 886,974 , less total issuance costs of $ 26,609 .

Includes gross proceeds of $ 3,194,530 , less total issuance costs of $ 95,836 .

The accompanying notes are an integral part of these condensed financial statements.

1 unchanged sentence

Condensed Statements of Cash Flows

For the Six Months Ended

For the Nine Months Ended

September 30,

Cash Flows From Operating Activities

5 unchanged sentences

Amortization of debt discount

Write-off of property and equipment

Write-down of inventories to net realizable value

Provision for returned deferred clinical supplies

Non-cash rent expense

17 unchanged sentences

Vendor deposits for property and equipment

Investment in intangible asset

( 1,122,945 )

Net Cash Used In Investing Activities

3 unchanged sentences

Payment of offering issuance costs

( 1,091,354 )

Proceeds from sale of common stock in At the Market offering

5 unchanged sentences

Net Cash Provided By Financing Activities

Net (Decrease) Increase in Cash and Cash Equivalents

Net Decrease in Cash and Cash Equivalents

( 2,161,308 )

( 2,063,245 )

Cash, cash equivalents and restricted cash - Beginning of Period

Cash, cash equivalents and restricted cash - End of Period

The accompanying notes are an integral part of these condensed financial statements.

EYENOVIA, INC.

Condensed Statements of Cash Flows, continued

For the Nine Months Ended

September 30,

Cash, cash equivalents and restricted cash consisted of the following:

8 unchanged sentences

Original issue discount on notes payable

Warrant modification - incremental value

Issuance of common stock in consideration of licensing agreement

Cashless exercise of stock options

Issuance of common stock related to vested restricted stock units

[1] Includes gross proceeds of $ 14,981,299 , of which $ 5,741,299 is pre-funded warrants.

[1] For 2022, includes gross proceeds of $ 14,981,299 , of which $ 5,741,299 is pre-funded warrants.

[2] For 2023, includes gross proceeds of $ 11,977,468 , of which $ 4,168,011 is pre-funded warrants.

The accompanying notes are an integral part of these condensed financial statements.

4 unchanged sentences

(“Eyenovia” or the “Company”) is an ophthalmic technology company developing the Optejet® delivery system for use both in combination with its own drug-device therapeutic programs in mydriasis (pupil dilation), presbyopia and pediatric progressive myopia as well as out-licensing for additional indications.

The Company’s investigational products are classified by the Food and Drug Administration (“FDA”) as drug-device combination products with drug primary mode of action, meaning that the Center for Drug Evaluation and Research, or CDER, is designated as the lead center with primary jurisdictional oversight.

Accordingly, the product candidates are submitted to the FDA and CDER for premarket review and approval under new drug applications, or NDAs.

The Company’s investigational products are classified by the Food and Drug Administration (“FDA”) as drug-device combination products with drug primary mode of action, meaning that the Center for Drug Evaluation and Research (“CDER”), is designated as the lead center with primary jurisdictional oversight.

Accordingly, the product candidates are submitted to the FDA and CDER for premarket review and approval under new drug applications (“NDAs”).

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

2 unchanged sentences

GAAP for complete financial statements.

In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the condensed financial statements of the Company as of June 30, 2023 and for the three and six months ended June 30, 2023 and 2022.

The results of operations for the six months ended June 30, 2023 are not necessarily indicative of the operating results for the full year ending December 31, 2023 or any other period.

These unaudited condensed financial statements should be read in conjunction with the audited financial statements and related disclosures of the Company as of December 31, 2022 and for the year then ended, which were included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 31, 2023, as amended by Amendment No.

1, filed with the SEC on May 1, 2023.

In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the condensed financial statements of the Company as of September 30, 2023 and for the three and nine months ended September 30, 2023 and 2022.

The results of operations for the nine months ended September 30, 2023 are not necessarily indicative of the operating results for the full year ending December 31, 2023 or any other period.

These unaudited condensed financial statements should be read in conjunction with the audited financial statements and related disclosures of the Company as of December 31, 2022 and for the year then ended, which were included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the Securities and Exchange Commission (“SEC”) on March 31, 2023 (the “2022 Form 10-K”), as amended by Amendment No.

1, filed with the SEC on May 1, 2023 (the “2022 Form 10-K Amendment”).

Note 2 – Going Concern and Summary of Significant Accounting Policies

Since the date of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, there have been no material changes to the Company’s significant accounting policies, except as disclosed below.

Since the date of the 2022 Form 10-K, there have been no material changes to the Company’s significant accounting policies, except as disclosed below.

Going Concern

As of June 30, 2023, the Company had cash and cash equivalents in the aggregate amount of approximately $ 17.5 million.

For the six months ended June 30, 2023 and 2022, the Company incurred net losses of approximately $ 12.0 million and $ 14.6 million, respectively, and used cash in operations of approximately $ 11.7 million and $ 12.9 million, respectively.

The Company does not have recurring revenue, has not yet achieved profitability and may never become profitable.

As of September 30, 2023, the Company had cash and cash equivalents in the aggregate amount of approximately $ 20.7 million.

For the nine months ended September 30, 2023 and 2022, the Company incurred net losses of approximately $ 19.3 million and $ 21.9 million, respectively, and used cash in operations of approximately $ 17.5 million and $ 19.7 million, respectively.

The Company does not have material recurring revenue, has not yet achieved profitability and may never become profitable.

The Company expects to continue to incur cash outflows from operations.

Research and development and general and administrative expenses will continue to be incurred by the Company and, as a result, the Company will eventually need to generate significant product revenues to achieve profitability.

These circumstances raise substantial doubt about the Company’s ability to continue as a going concern for at least one year from the date that these financial statements are issued.

These circumstances raise substantial doubt about the Company’s ability to continue as a going concern for at least one year from the date that these financial statements were issued.

Implementation of the Company’s plans and its ability to continue as a going concern will depend upon the Company’s ability to raise further capital through licensing transactions, the sale of additional equity or debt securities, or otherwise, to support its future operations.

2 unchanged sentences

If the Company is unable to secure additional capital, it may be required to curtail its research and development initiatives and/or take additional measures to reduce general and administrative and sales and marketing costs in order to conserve its cash.

Reclassifications

Certain prior period amounts presented on the Company’s financial statements have been reclassified in order to conform to current period presentation.

These reclassifications have no effect on previously reported results of operations or loss per share.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents in the financial statements.As of September 30, 2023, the Company had Treasury bills with original maturity dates of three months or less in the amount of $ 5,221,319 .

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents in the financial statements.As of June 30, 2023, the Company had Treasury bills with original maturity dates of three months or less in the amount of $ 4,493,766 .

The Company has cash deposits in a financial institution that, at times, may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits.

The Company has cash deposits in financial institutions that, at times, may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits.

The Company has not experienced losses in such accounts and periodically evaluates the creditworthiness of its financial institutions.

As of June 30, 2023 and December 31, 2022, the Company had cash balances in excess of FDIC insurance limits of $ 12,474,323 and $ 22,613,520 , respectively.

As of September 30, 2023 and December 31, 2022, the Company had cash balances in excess of FDIC insurance limits of $ 15,056,184 and $ 22,613,520 , respectively.

Net Loss Per Common Share

3 unchanged sentences

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

September 30,

Net loss attributable to common stockholders

10 unchanged sentences

The following securities are excluded from the calculation of weighted average diluted common shares because their inclusion would have been anti-dilutive:

September 30,

Convertible notes

1 unchanged sentence

Total potentially dilutive shares

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

Clinical Supply Arrangements

1 unchanged sentence

(“B+L”) and Arctic Vision (Hong Kong) Limited (“Arctic Vision”) have contracted with the Company to manufacture and supply them with the appropriate drug-device combination products to conduct their clinical trials on a cost plus 10 % mark-up basis.

The Company’s licensing agreements with Bausch + Lomb and Arctic Vision represent collaborative arrangements and they are not a customer with respect to the clinical supply arrangements.

The Company’s licensing agreements with Bausch + Lomb and Arctic Vision represent collaborative arrangements and they are not customers with respect to the clinical supply arrangements.

The Company’s policy is to (a) defer the materials and manufacturing costs in order to properly match them up against the income from the clinical supply arrangements;

and (b) to report the net income from the clinical supply arrangements as other income.

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

Inventories are stated at the lower of cost or net realizable value.

Cost is determined using the first-in, first-out method.

The cost of inventory that is sold to third parties is included within cost of sales.

The Company will periodically review for slow-moving, excess or obsolete inventories.

Inventory is primarily comprised of drug-device combination products, which are available for commercial sale, as follows:

September 30,

Finished goods

Work-in-process

Raw materials

Total inventory

Intangible Assets

The application of the guidance in ASC 805 (“Business Combinations”) on accounting for business combinations can differ significantly depending on whether the acquired entity is considered a “business” or an “asset.” A determination of whether the transaction represented an asset acquisition or a business combination must be made.

Pursuant to ASC 350 (“Intangibles - Goodwill and Other”), the payment made for the intangible asset will be capitalized and amortized over the useful life of the intangible asset.

On August 15, 2023 (the “Effective Date”), the Company entered into a license agreement (the “License”) with Formosa Pharmaceuticals Inc.

(the “Licensor”), whereby the Company acquired the exclusive U.S.

rights to commercialize any product related to a novel formulation of clobetasol propionate ophthalmic nanosuspension, 0.05 % (the “Licensed Product”), which is currently under review by the FDA for ophthalmic use for inflammation and pain after ocular surgery and supplemental disease indications, if any, associated with the New Drug Application for the Licensed Product.

The License will remain in effect for ten years from the date of the first commercial sale of a Licensed Product, unless earlier terminated.

The Company paid the Licensor the aggregate amount of $ 2,000,000 (the “Upfront Payment”), consisting of (a) cash in the amount of $ 1,000,000 and (b) 487,805 shares of common stock valued at $ 1,000,000 , which is included in Intangible Assets on the accompanying condensed balance sheet.

In addition to the Upfront Payment, the Company also capitalized $ 122,945 of transaction costs, which were primarily legal expenses.

In addition, the Company must pay the Licensor up to $ 4 million upon the achievement of certain development milestones and up to $ 80 million upon the achievement of certain sales milestones.

The initial trigger for development milestone payments is FDA approval of the Licensed Product.

These contingent payments will be recorded when payment becomes probable and estimable.

It was determined that the transaction represented an asset acquisition, rather than a business combination, because substantially all of the fair value of the assets acquired is concentrated in a single identifiable asset.

Consequently, the accounting is pursuant to the cost accumulation model.

The Upfront Payment has been capitalized as an intangible asset by the Company, and will be amortized over the useful life of 10 years beginning on the date of the first commercial sale of the Licensed Product.

Recently Adopted Accounting Standards

7 unchanged sentences

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”, to clarify the accounting for certain financial instruments with characteristics of liabilities and equity.

The amendments in this update reduce the number of accounting models for convertible debt instruments and convertible preferred stock by removing the cash conversion model and the beneficial conversion feature model.

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

amendments in this update reduce the number of accounting models for convertible debt instruments and convertible preferred stock by removing the cash conversion model and the beneficial conversion feature model.

Limiting the accounting models will result in fewer embedded conversion features being separately recognized from the host contract.

7 unchanged sentences

Note 3 – Prepaid Expenses and Other Current Assets

As of June 30, 2023 and December 31, 2022, prepaid expenses and other current assets consisted of the following:

As of September 30, 2023 and December 31, 2022, prepaid expenses and other current assets consisted of the following:

September 30,

Payroll tax receivable

Prepaid insurance expenses

Prepaid general and administrative expenses

Prepaid conference expenses

Prepaid professional fees

Prepaid research and development expenses

Prepaid general and administrative expenses

Prepaid patent expenses

Prepaid conference expenses

Prepaid rent and security deposit

Prepaid security deposit

Total prepaid expenses and other current assets

1 unchanged sentence

NOTES TO CONDENSED FINANCIAL STATEMENTS

Note 4 - Property and Equipment, Net

As of September 30, 2023 and December 31, 2022, property and equipment consisted of the following:

September 30,

Equipment not yet placed in service

Leasehold improvements

accumulated depreciation and amortization

( 1,141,522 )

Property and equipment, net

Depreciation expense was $ 318,417 and $ 82,997 for the three months ended September 30, 2023 and 2022, respectively, of which $ 316,673 and $ 80,212 , respectively, was included within research and development expenses and $ 1,744 and $ 2,785 , respectively, was included in general and administrative expenses in the accompanying statements of operations.

Depreciation expense was $ 505,684 and $ 228,898 for the nine months ended September 30, 2023 and 2022, respectively, of which $ 499,535 and $ 221,031 , respectively, was included within research and development expenses and $ 6,149 and $ 7,867 , respectively, was included in general and administrative expenses in the accompanying statements of operations.

As of September 30, 2023 and December 31, 2022, the Company had $ 686,753 and $ 726,326 , respectively, of outstanding deposits for equipment purchases.

Note 5 – Accrued Compensation

As of June 30, 2023 and December 31, 2022, accrued compensation consisted of the following:

As of September 30, 2023 and December 31, 2022, accrued compensation consisted of the following:

September 30,

Accrued bonus expenses

2 unchanged sentences

Note 6 – Accrued Expenses and Other Current Liabilities

As of June 30, 2023 and December 31, 2022, accrued expenses and other current liabilities consisted of the following:

Accrued consulting and professional services

As of September 30, 2023 and December 31, 2022, accrued expenses and other current liabilities consisted of the following:

September 30,

Accrued rework of clinical supply returns

Accrued research and development expenses

Accrued leasehold improvements

Credit card payable

Accrued consulting and professional services

Accrued franchise tax

Accrued leasehold improvements

Accrued travel and entertainment expenses

Total accrued expenses and other current liabilities

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

Note 7 – Notes Payable

As of June 30, 2023 and December 31, 2022, notes payable consisted of the following:

June 30, 2023

As of September 30, 2023 and December 31, 2022, notes payable consisted of the following:

September 30, 2023

December 31, 2022

4 unchanged sentences

Current portion:

D&O insurance policy loan

Avenue - Note payable

3 unchanged sentences

Avenue - Note payable

( 1,120,372 )

Avenue - Convertible note payable

3 unchanged sentences

On February 24, 2023, the Company issued a note payable in the amount of $ 609,140 for the purchase of a directors and officers’ liability insurance policy (the “D&O Loan”).

The note accrues interest at a rate of 7.11 % per year and matures on August 24, 2023.

The D&O Loan is payable in six monthly payments of $ 103,639 consisting of principal and interest.

During the six months ended June 30, 2023, the Company repaid $ 403,689 of principal owed on the D&O Loan.

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

On May 22, 2023, pursuant to the Company’s Loan and Security Agreement (the “Loan and Security Agreement”) with Avenue Capital Management II, L.P., and related entities (“Avenue”), the Company received an additional tranche of non-convertible debt funding in the gross amount of $ 5,000,000 .

The note accrued interest at a rate of 7.11 % per year and matured on August 24, 2023.

The D&O Loan was payable in six monthly payments of $ 103,639 consisting of principal and interest.

During the nine months ended September 30, 2023, the Company fully repaid the $ 609,140 of principal owed on the D&O Loan.

The Company paid approximately $ 126,000 of origination and legal fees connected to this debt funding.

3 unchanged sentences

Following the interest-only period, the Company will make equal monthly payments of principal until the maturity date, plus interest.

During the three months ended June 30, 2023, the Company recorded interest expense of $ 558,003 , of which $ 550,746 was related to the Loan and Security Agreement with Avenue Capital Management II, L.P.

(“Avenue”) and related entities, (including amortization of debt discount of $ 163,956 ) and $ 7,257 was related to the D&O Loan.

During the six months ended June 30, 2023, the Company recorded interest expense of $ 1,012,006 , of which $ 1,001,140 was related to the Loan and Security Agreement (including amortization of debt discount of $ 313,446 ) and $ 10,866 was related to the D&O Loan.

During the three months ended September 30, 2023, the Company recorded interest expense of $ 679,222 , of which $ 677,394 (which includes amortization of debt discount of $ 184,208 ) was related to the Loan and Security Agreement with Avenue and $ 1,828 was related to the D&O Loan.

During the nine months ended September 30, 2023, the Company recorded interest expense of $ 1,691,228 , of which $ 1,678,534 was related to the Loan and Security Agreement (including amortization of debt discount of $ 497,654 ) and $ 12,694 was related to the D&O Loan.

Note 8 – Commitments and Contingencies

Clinical Supply Returns

A certain portion of clinical supply product sold to a licensee has been determined to be defective and will be returned to the Company to be replaced or reworked.

The defect occurred with the clinical trial Gen 1.0 device.

The Company is still working to determine the exact quantity of the defective clinical supply and the cost to replace or rework the product.

The current estimate of the range of the loss is between $ 400,000 and $ 600,000 , with no amount within that range being a more accurate estimate than the others at this time.

Accordingly, the Company has recorded a charge equal to the low end of the range or $ 400,000 , which is included within other income (expense), because the original sales to the licensee were recorded on that line item.

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

Operating Leases

6 unchanged sentences

A summary of the Company’s right-of-use assets and liabilities as follows:

For the Six Months Ended

June 30, 2023

For the Nine Months Ended

September 30, 2023

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows used in operating activities

Right-of-use assets obtained in exchange for lease obligations

Right-of-use assets and lease liabilities recognized upon lease renewal

Operating leases

3 unchanged sentences

Operating leases

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

Future minimum payments under all of the Company’s operating lease agreements are as follows:

11 unchanged sentences

Equity Incentive Plan

On June 27, 2023, the Company’s stockholders approved an amendment to the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan, reserving an additional 1,000,000 shares of common stock for further issuance under such plan.

On June 27, 2023, the Company’s stockholders approved an amendment to the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan, as amended, reserving an additional 1,000,000 shares of common stock for further issuance under such plan.

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

At-The-Market Offering

During the six months ended June 30, 2023, the Company received approximately $ 3.9 million in net proceeds from the sale of 1,421,936 shares of its common stock pursuant to its Sales Agreement with SVB Securities LLC (“SVB Securities”) in an ”at-the-market” offering (the “At-the-Market Offering Program”).

During the nine months ended September 30, 2023, the Company received approximately $ 4.0 million in net proceeds from the sale of 1,464,346 shares of its common stock pursuant to its Sales Agreement with Leerink Partners, formerly known as SVB Securities LLC (“Leerink Partners”) in an ”at-the-market” offering (the “At-the-Market Offering Program”).

Registered Direct Offering

On August 24, 2023, the Company entered into a securities purchase agreement with a certain institutional and accredited investor (the “Purchaser”), pursuant to which the Company agreed to sell, in a registered direct offering by the Company directly to the Purchaser (the “August 2023 Offering”), 4,198,633 shares of common stock, pre-funded warrants to purchase up to 2,252,979 shares of common stock (the “Pre-Funded Warrants”) and warrants to purchase up to 4,838,709 shares of common stock (the “Common Warrants” and, together with the Pre-Funded Warrants, the “Warrants”).

The combined offering price for each share of common stock and accompanying Common Warrant was $ 1.86 , and the combined offering price for each Pre-Funded Warrant and accompanying Common Warrant was $ 1.85 .

The Common Warrants will be exercisable beginning six months following the date of issuance and may be exercised for a period of five years from the initial exercisability date at an exercise price of $ 2.23 per share.

The Pre-Funded Warrants were immediately exercisable and may be exercised at any time until all of the Pre-Funded Warrants are exercised in full at an exercise price of $ 0.01 per share.

The exercise prices and numbers of shares of common stock issuable upon exercise of the Common Warrants and the Pre-Funded Warrants are subject to typical anti-dilution provisions.

A holder may not exercise any portion of such holder’s Common Warrants or Pre-Funded Warrants to the extent that the holder would own more than 4.99 % of the Company’s outstanding common stock immediately after exercise (unless the holder otherwise elects a limitation of 9.99 %).

The Company determined that the Warrants met the criteria to be classified as equity.

The net cash proceeds of the August 2023 Offering were approximately $ 10.9 million after deducting cash issuance costs in the aggregate amount of approximately $ 1.1 million.

See Warrant Modification below for details about an additional $ 1.7 million of non-cash issuance costs.

The August 2023 Offering closed on August 29, 2023.

Warrant Modification

Original Warrant Issuance - March 2022

On March 3, 2022, the Company entered into a securities purchase agreement (the “March 2022 Purchase Agreement”) with a holder (the “Holder”) relating to the issuance and sale of 3,000,000 shares of common stock, pre-funded warrants to purchase an aggregate of 1,870,130 shares of common stock and warrants to purchase an aggregate of 4,870,130 shares of common stock (the “March 2022 Investor Warrants”).

The March 2022 Investor Warrants became exercisable beginning six months from the date of issuance and initially were exercisable for a period of five years at an exercise price of $ 3.54 per share.

Warrant Amendment

In connection with the August 2023 Offering (see “Registered Direct Offering” above), the Company entered into a warrant amendment agreement (the “Amendment”) with the Holder, whereby the Company agreed to amend the March 2022 Investor Warrants to (i) reduce the exercise price from $ 3.54 per share of common stock to $ 2.23 per share of common stock, (ii) extend the term of the March 2022 Investor Warrants until March 1, 2029, (iii) include a stockholder approval requirement in connection with a modification of the beneficial ownership limitation and (iv) prohibit exercise of the March 2022 Investor Warrants for the six-month period following the effective date of the Amendment.

The Company accounted for the modification of the March 2022 Investor Warrants as an exchange of the old warrants for new warrants.

The incremental value of the new warrant (resulting from the decrease in exercise price from $ 3.54 to $ 2.23 per share and the extension of the warrant expiration date to March 1, 2029) was measured as the excess of the fair value of the modified warrants over the fair

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

value of the original warrants immediately before modification.

The increase in the incremental value of $ 1,738,700 was credited to additional paid-in-capital (“APIC”) and debited to APIC as an issuance cost of the August 2023 Offering.

A summary of the warrant activity for the nine months ended September 30, 2023 is presented below:

Outstanding January 1, 2023

Repriced - Old (1)

( 4,870,130 )

Repriced - New (1)

Outstanding September 30, 2023

Exercisable September 30, 2023

Warrants represent the reset of the exercise price of the March 2022 Investor Warrants to purchase 4,870,130 shares of common stock to a price of $ 2.23 per share.

The following table presents information related to warrants as of September 30, 2023:

Warrants Outstanding

Warants Exercisable

Remaining Life

(1) These are Pre-Funded Warrants that do not expire.

(2) These warrants are not yet exercisable.

Stock-Based Compensation Expense

The Company records stock-based compensation expense related to stock options and restricted stock units (“RSUs”).

For the three months ended June 30, 2023 and 2022, the Company recorded expense of $ 493,632 ($ 36,197 of which was included within research and development expenses and $ 457,435 was included within general and administrative expenses on the statements of operations) and $ 1,036,926 ($ 516,669 of which was included within research and development expenses and $ 520,257 was included within general and administrative expenses on the statements of operations), respectively.

For the six months ended June 30, 2023 and 2022, the Company recorded expense of $ 1,312,696 ($ 411,327 of which was included within research and development expenses and $ 901,369 was included within general and administrative expenses on the statements of operations) and $ 1,945,913 ($ 1,017,850 of which was included within research and development expenses and $ 928,063 was included within general and administrative expenses on the statements of operations), respectively.

For the three months ended September 30, 2023 and 2022, the Company recorded expense of $ 612,969 ($ 235,731 of which was included within research and development expenses and $ 377,238 was included within general and administrative expenses on the statements of operations) and $ 928,733 ($ 420,619 of which was included within research and development expenses and $ 508,114 was included within general and administrative expenses on the statements of operations), respectively.

For the nine months ended September 30, 2023 and 2022, the Company recorded expense of $ 1,925,665 ($ 647,058 of which was included within research and development expenses and $ 1,278,607 was included within general and administrative expenses on the statements of operations) and $ 2,874,646 ($ 1,438,469 of which was included within research and development expenses and $ 1,436,177 was included within general and administrative expenses on the statements of operations), respectively.

EYENOVIA, INC.

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Restricted Stock Units

A summary of RSU activity during the six months ended June 30, 2023 is presented below:

A summary of RSU activity during the nine months ended September 30, 2023 is presented below:

Grant Date Value

RSUs non-vested January 1, 2023

RSUs non-vested June 30, 2023

Vested RSUs undelivered June 30, 2023

RSUs non-vested September 30, 2023

Vested RSUs undelivered September 30, 2023

To date, RSUs have only been granted to directors in accordance with the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan.

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On June 16, 2023, the Company delivered 44,444 shares of common stock in respect of RSUs based on the prior resignation of two directors.

As of June 30, 2023, there was $ 200,000 of unrecognized stock-based compensation expense related to RSUs which will be recognized over a weighted average period of 1.0 years.

As of September 30, 2023, there was $ 203,055 of unrecognized stock-based compensation expense related to RSUs which will be recognized over a weighted average period of 1.0 years.

Stock Options

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For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

September 30,

Expected term (years)

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The Company has not declared dividends, is currently in the development stage and has no plan to declare future dividends at this time.

The weighted average estimated grant date fair value of the stock options granted for the three months ended June 30, 2023 and 2022 was approximately $ 2.04 and $ 1.37 per share, respectively.

The weighted average estimated grant date fair value of the stock options granted for the six months ended June 30, 2023 and 2022 was approximately $ 1.78 and $ 2.02 per share, respectively.

There were no options granted in the three months ended September 30, 2023.

The weighted average estimated grant date fair value of the stock options granted for the three months ended September 30, 2022 was approximately $ 1.22 per share.

The weighted average estimated grant date fair value of the stock options granted for the nine months ended September 30, 2023 and 2022 was approximately $ 1.70 and $ 1.61 per share respectively.

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

A summary of the option activity during the six months ended June 30, 2023 is presented below:

A summary of the option activity during the nine months ended September 30, 2023 is presented below:

Outstanding, January 1, 2023

Forfeited/ Expired

Outstanding June 30, 2023

Exercisable June 30, 2023

The following table presents information related to stock options as of June 30, 2023:

Outstanding September 30, 2023

Exercisable September 30, 2023

The following table presents information related to stock options as of September 30, 2023:

Options Outstanding

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$ 6.00 - $ 6.99

As of June 30, 2023, there was $ 2,868,023 of unrecognized stock-based compensation expense related to stock options, which will be recognized over a weighted average period of 1.7 years.

As of September 30, 2023, there was $ 2,841,102 of unrecognized stock-based compensation expense related to stock options, which will be recognized over a weighted average period of 1.8 years.

Note 10 – Employee Benefit Plans

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For 2023 and 2022, the Company’s Board of Directors approved a matching contribution equal to 100 % of elective deferrals up to 4 % of eligible earnings with the matching contribution subject to certain vesting requirements as outlined in the Plan documents.

During the three months ended June 30, 2023 and 2022, the Company recorded expense of $ 46,196 and $ 47,883 associated with its matching contributions, respectively.

During the six months ended June 30, 2023 and 2022, the Company recorded expense of $ 125,164 and $ 133,982 associated with its matching contributions, respectively.

During the three months ended September 30, 2023 and 2022, the Company recorded expense of $ 46,636 and $ 39,914 associated with its matching contributions, respectively.

During the nine months ended September 30, 2023 and 2022, the Company recorded expense of $ 171,800 and $ 173,896 associated with its matching contributions, respectively.

EYENOVIA, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

Note 11 - Subsequent Events

Exercise of Pre-Funded Warrants

On November 2, 2023, the Purchaser exercised a portion of its Pre-Funded Warrants in order to purchase 1,223,979 of the Company’s common stock at the exercise price of $ 0.01 per share.

The total proceeds of the transaction were $ 12,240 (see “Registered Direct Offering” in Note 9 – Stockholders’ Equity).

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-Q

Item 1. Financial Statements