HYPERION DEFI, INC. 10-K

Item 9A. Controls and Procedures. Evaluation of Disclosure Controls and Procedures As of the end of the period covered by this Annual Report on Form 10-K, we carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial and accounting officer, of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended, or the Exchange Act. In designing and evaluating our disclosure controls and procedures, management recognizes that any disclosure controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. Based on their evaluation, our principal executive officer and principal financial and accounting officer concluded that, as of December 31, 2023, our disclosure controls and procedures were designed to, and were effective to, provide assurance at a reasonable level that the information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial and accounting officer, as appropriate, to allow timely decisions regarding required disclosures as of December 31, 2023. Management’s Report on Internal Control over Financial Reporting Our management, including our principal executive officer and principal financial and accounting officer, is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act). Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP. Our internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements. Under the supervision and with the participation of our management, including our principal executive officer and principal financial and accounting officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2023, based on the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) (2013 Framework). Based on this evaluation under the 2013 Framework, our principal executive officer and principal financial and accounting officer have concluded that our internal control over financial reporting was effective as of December 31, 2023. 95 Table of Contents Changes in Internal Control over Financial Reporting There has been no change in our internal control over financial reporting that occurred during the quarter ended December 31, 2023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Attestation Report of Registered Public Accounting Firm This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm due to an exemption for non-accelerated filers. Item 9B. Other Information. N o n e . Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. ​ 96 Table of Contents PART III Item 10. Directors, Executive Officers, and Corporate Governance. Information required by this Item concerning our directors is incorporated by reference from the sections captioned “Election of Directors” and “Corporate Governance Matters” contained in our proxy statement related to the 2024 Annual Meeting of Stockholders currently scheduled to be held on June 12, 2024, or 2024 Proxy Statement, which we intend to file with the SEC within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K. The information required by this Item concerning our Audit Committee is incorporated by reference from the section captioned “Corporate Governance Matters—Board Committees—Audit Committee” contained in our 2024 Proxy Statement. We have adopted a code of business conduct and ethics relating to the conduct of our business by all of our employees, executive officers, and directors. The policy is posted on our website, www.eyenovia.com. The information required by this Item concerning our executive officers is incorporated by reference from the section captioned “Executive Officers” contained in our 2024 Proxy Statement. The information required by this Item concerning compliance with Section 16(a) of the Exchange Act is incorporated by reference from the section of our 2024 Proxy Statement captioned “Delinquent Section 16(a) Reports.” Item 11. Executive Compensation. The information required by this Item is incorporated by reference to the information under the sections captioned “Executive Compensation,” and “Director Compensation” in our 2024 Proxy Statement. 97 Table of Contents Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. The following table provides information as of December 31, 2023 about our common stock that may be issued upon the exercise of options, warrants and rights under all of our existing equity compensation plans (including individual arrangements): Equity Compensation Plan Information ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ ​ ​ ​ ​ average ​ Number of securities ​ ​ Number of securities ​ exercise price ​ remaining available for ​ ​ to be issued upon ​ of outstanding ​ future issuance under ​ ​ exercise of ​ options, ​ equity compensation plans ​ ​ outstanding options, ​ warrants and ​ (excluding securities Plan Category ​ warrants, and rights ​ rights ​ reflected in column (a) Equity compensation plans approved by security holders ​ 2014 Equity Incentive Plan, as amended 851,610 ​ $ 3.13 182,625 Amended and Restated 2018 Omnibus Stock Incentive Plan 4,696,531 ​ 3.17 1,871,784 Equity compensation plans not approved by security holders — ​ — — Total 5,548,141 ​ $ 3.17 2,054,409 ​ The other information required by this Item is incorporated by reference to the information under the section captioned “Security Ownership of Certain Beneficial Owners and Management” contained in our 2024 Proxy Statement. Item 13. Certain Relationships and Related Transactions, and Director Independence. The information required by this Item is incorporated by reference to the information under the section captioned “Certain Relationships and Related-Party Transactions” and “Corporate Governance Matters” in our 2024 Proxy Statement. Item 14. Principal Accounting Fees and Services. The information required by this Item is incorporated by reference to the information under the section captioned “Audit Committee Report” in the proxy statement for the 2024 Annual Meeting of Stockholders. ​ 98 Table of Contents PART IV Item 15. Exhibits, Financial Statement Schedules. (a) List of documents filed as part of this report: 1. Financial Statements: The financial statements of the Company and the related reports of the Company’s independent registered public accounting firm thereon have been filed under Item 8 hereof. 2. Financial Statement Schedules: None. 3. Exhibits Index The following is a list of exhibits filed as part of this Annual Report on Form 10-K: ​ ​ ​ ​ Incorporated by Reference from Filings as Noted Below (Unless Otherwise Indicated) Exhibit Number Exhibit Description Form File No. Exhibit Filing Date 3.1 ​ Third Amended and Restated Certificate of Incorporation ​ 8-K ​ 001-38365 ​ 3.1 ​ January 29, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 3.1.1 ​ Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation 8-K ​ 001-38365 ​ 3.1.1 ​ June 14, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 3.2 ​ Second Amended and Restated Bylaws ​ 8-K ​ 001-38365 ​ 3.1 ​ February 7, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4.1 ​ Description of Securities ​ 10-K ​ 001-38365 ​ 4.1 ​ March 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4.2 ​ Form of Class A Warrant Issued on March 24, 2020 ​ 8-K ​ 001-38365 ​ 4.1 ​ March 25, 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4.3 ​ Form of Class B Warrant Issued on March 24, 2020 ​ 8-K ​ 001-38365 ​ 4.2 ​ March 25, 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4.4 ​ Form of Warrant Issued on May 7, 2021 ​ 8-K ​ 001-38365 ​ 4.1 ​ May 10, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4.5 ​ Form of Pre-Funded Warrant Issued on March 7, 2022 ​ 8-K/A ​ 001-38365 ​ 4.1 ​ March 9, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4.6 ​ Form of Warrant Issued on March 7, 2022 ​ 8-K/A ​ 001-38365 ​ 4.2 ​ March 9, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4 .7 ​ Form of Warrant Issued on August 29, 2023 ​ 8-K ​ 001-38365 ​ 4 .1 ​ August 29, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4.8 ​ Form of Warrant issued on August 29, 2023 ​ 8-K ​ 001-38365 ​ 4.2 ​ August 29, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 99 Table of Contents 10.1 ​ Exclusive License Agreement, dated March 18, 2015, between Eyenovia, Inc. and Senju Pharmaceutical Co., Ltd. ​ S-1 ​ 333-222162 ​ 10.1 ​ December 19, 2017 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.1.1# ​ Amendment to the Exclusive License Agreement by and between Eyenovia, Inc. and Senju Pharmaceutical Co., Ltd., dated April 8, 2020 ​ 10-Q ​ 001-38365 ​ 10.24 ​ August 14, 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.1.2# ​ Letter Agreement by and between Eyenovia, Inc. and Senju Pharmaceutical Co., Ltd., dated August 10, 2020 ​ 10-Q ​ 001-38365 ​ 10.27 ​ August 14, 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.2* ​ Master Consulting Services Agreement, dated November 4, 2014, between Eyenovia, Inc. and Private Medical Equity, Inc. ​ S-1 ​ 333-222162 ​ 10.10 ​ December 19, 2017 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.3* ​ Executive Employment Agreement, dated February 15, 2019, by and between the Company and Tsontcho Ianchulev ​ 8-K ​ 001-38365 ​ 10.16 ​ February 19, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.4* ​ Executive Employment Agreement, dated February 15, 2019, by and between the Company and John Gandolfo ​ 8-K ​ 001-38365 ​ 10.17 ​ February 19, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.5* ​ Executive Employment Agreement, dated February 15, 2019, by and between the Company and John Gandolfo ​ 8-K ​ 001-38365 ​ 10.19 ​ February 19, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.6 ​ Form of Nondisclosure, Assignment of Inventions and Noncompetition Agreement ​ 8-K ​ 001-38365 ​ 10.21 ​ February 19, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.7* ​ Eyenovia, Inc. 2014 Equity Incentive Plan, as amended ​ S-8 ​ 333-233278 ​ 10.14 ​ August 14, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.8* ​ Form of Nonqualified Stock Option Agreement ​ S-8 ​ 333-233278 ​ 10.15 ​ August 14, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.9 ​ Registration Rights Agreement, dated March 23, 2020, between Eyenovia, Inc. and the investors named therein ​ 8-K ​ 001-38365 ​ 10.23 ​ March 25, 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.10 ​ Promissory Note and Agreement dated May 3, 2020 ​ 8-K ​ 001-38365 ​ 10.24 ​ May 8, 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.11* ​ Eyenovia, Inc. Amended and Restated 2018 Omnibus Stock Incentive Plan ​ 8-K ​ 001-38365 ​ 10.1 ​ June 17, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.12* ​ Form of Notice of Stock Option Grant and Award Agreement ​ 8-K ​ 001-38365 ​ 10.14 ​ June 14, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.13* ​ Form of Restricted Stock Award Agreement ​ 8-K ​ 001-38365 ​ 10.15 ​ June 14, 2018 100 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.14# ​ License Agreement by and between Eyenovia, Inc. and Arctic Vision (Hong Kong) Limited, dated August 10, 2020 ​ 10-Q ​ 001-38365 ​ 10.28 ​ August 14, 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.15# ​ License Agreement by and between Eyenovia, Inc. and Bausch Health Ireland Limited, dated October 9, 2020 ​ 8-K ​ 001-38365 ​ 10.1 ​ October 13, 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.16* ​ First Amendment to Executive Employment Agreement, dated February 1, 2021, by and between the Company and Michael M. Rowe ​ 8-K ​ 001-38365 ​ 10.1 ​ February 3, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.17# ​ Loan and Security Agreement, by and between Eyenovia, Inc. and Silicon Valley Bank, dated May 7, 2021 ​ 8-K ​ 001-38365 ​ 10.1 ​ May 10, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.18# ​ First Amendment to Loan and Security Agreement, by and between Eyenovia, Inc. and Silicon Valley Bank, dated September 29, 2021 ​ 10-Q ​ 001-38365 ​ 10.3 ​ November 12, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.19 ​ Waiver Agreement, by and between Eyenovia, Inc. and Silicon Valley Bank, dated November 30, 2021 ​ 8-K ​ 001-38365 ​ 10.1 ​ December 3, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.20 ​ Sales Agreement, by and between Eyenovia, Inc. and SVB Leerink LLC, dated December 14, 2021 ​ S-3 ​ 333-261638 ​ 1.2 ​ December 14, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.21 ​ Securities Purchase Agreement by and between Eyenovia, Inc. and Armistice Capital Master Fund Ltd., dated March 3, 2022 ​ 8-K ​ 001-38365 ​ 10.1 ​ March 7, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.22 ​ Addendum to Executive Employment Agreement, dated March 10, 2022, by and between the Company and Tsontcho Ianchulev ​ 10-K ​ 001-38365 ​ 10.23 ​ March 30, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.23 ​ Addendum to Executive Employment Agreement, dated March 10, 2022, by and between the Company and John Gandolfo ​ 10-K ​ 001-38365 ​ 10.24 ​ March 30, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.24 ​ Addendum to Executive Employment Agreement, dated March 10, 2022, by and between the Company and Michael Rowe ​ 10-K ​ 001-38365 ​ 10.25 ​ March 30, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.25 ​ Third Amendment to Loan and Security Agreement, dated as of May 6, 2022, by and between Eyenovia, Inc. and Silicon Valley Bank. ​ 8-K ​ 001-38365 ​ 10.1 ​ May 15, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 101 Table of Contents 10.26*# ​ Employment Agreement, dated July 26, 2022, by and between Eyenovia, Inc, and Michael Rowe ​ 10-Q ​ 001-38365 ​ 10.2 ​ August 11, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.27* ​ Executive Chair Agreement, dated August 1, 2022, by and between, Eyenovia, Inc. and Tsontcho Ianchulev ​ 10-Q ​ 001-38365 ​ 10.3 ​ August 11, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.28 ​ Non-Employee Director Compensation Policy, as amended ​ 10-Q ​ 001-38365 ​ 10.1 ​ November 14, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.29 ​ Loan and Security Agreement, dated November 22, 2022, by among Eyenovia, Inc., Avenue Capital Management II, L.P., Avenue Venture Opportunities Fund, L.P. and Avenue Venture Opportunities Fund II, L.P. ​ 10-K ​ 001-38365 ​ 10.30 ​ March 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.30 ​ Supplement to the Loan and Security Agreement, dated November 22, 2022, by among Eyenovia, Inc., Avenue Capital Management II, L.P., Avenue Venture Opportunities Fund, L.P. and Avenue Venture Opportunities Fund II, L.P. ​ 10-K ​ 001-38365 ​ 10.31 ​ March 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.31 ​ Subscription Agreement, dated November 22, 2022, by and among Eyenovia, Inc., Avenue Venture Opportunities Fund, L.P. and Avenue Venture Opportunities Fund II, L.P. ​ 10-K ​ 001-38365 ​ 10.32 ​ March 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.32 ​ Employment Agreement, dated December 19, 2022, by and between Eyenovia, Inc. and Bren Kern ​ 10-K ​ 001-38365 ​ 10.33 ​ March 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 1 0.33 ​ Form of Restricted Stock Unit Agreement ​ 10 -K/A ​ 001-38365 ​ 10.34 ​ May 1,2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.34 ​ Eyenovia, Inc. Amended and Restated 2018 Omnibus Stock Incentive Plan, as Amended ​ 8-K ​ 001-38365 ​ 10.1 ​ June 27, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.35# ​ License Agreement, dated August 15, 2023, by and between Eyenovia, Inc. and Formosa Pharmaceuticals, Inc. ​ 10-Q ​ 001-38365 ​ 10.1 ​ November 13, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.36 ​ Securities Purchase Agreement, dated August 24, 2023 ​ 8-K ​ 001-38365 ​ 10.1 ​ August 29, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 10.37 ​ Warrant Amendment Agreement, dated August 24, 2023 ​ 8-K ​ 001-38365 ​ 10.2 ​ August 29, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 102 Table of Contents 10.38# ​ Mutual Termination and Reassignment, dated January 12, 2024, by and between Eyenovia, Inc and Bausch + Lomb Ireland Limited ​ -- ​ -- ​ -- ​ Filed herewith ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 23.1 ​ Consent of Marcum LLP ​ -- ​ -- ​ -- ​ Filed herewith ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 31.1 ​ Certification of the Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 ​ -- ​ -- ​ -- ​ Filed herewith ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 31.2 ​ Certification of the Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 ​ -- ​ -- ​ -- ​ Filed herewith ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 32.1 ​ Certification of the Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 ​ -- ​ -- ​ -- ​ Filed herewith ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 32.2 ​ Certification of the Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 ​ -- ​ -- ​ -- ​ Filed herewith ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 9 7.1 ​ Policy Relating to Recovery of Erroneously Awarded Compensation ​ -- ​ -- ​ -- ​ Filed herewith ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 101 ​ Inline interactive data files pursuant to Rule 405 of Regulation S-T: (i) Balance Sheets as of December 31, 2022 and 2021; (ii) Statements of Operations for the Years Ended December 31, 2022 and 2021; (iii) Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2022 and 2021; (iv) Statements of Cash Flows for the Years Ended December 31, 2022 and 2021; and (v) Notes to Financial Statements ​ -- ​ -- ​ -- ​ Filed herewith ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 104 ​ Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document contained in Exhibit 101 ​ -- ​ -- ​ -- ​ Filed herewith * Management contract or other compensatory plan. # Certain confidential portions of this Exhibit were omitted by means of marking such portions with brackets (“[***]”) because the identified confidential portions (i) are not material and (ii) are the type of information that the Company treats as private or confidential. Item 16. Form 10-K Summary. None. ​ 103 Table of Contents SIGNATURES Pursuant to the requirements of Sections 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. EYENOVIA, INC. Date: March 18, 2024 By: /s/ Michael Rowe Michael Rowe Chief Executive Officer (Principal Executive Officer) ​ Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Michael Rowe Chief Executive Officer March 18, 2024 Michael Rowe (Principal Executive Officer) and Director /s/ John Gandolfo Chief Financial Officer March 18, 2024 John Gandolfo (Principal Financial and Accounting Officer) /s/ Tsontcho Ianchulev Director March 18, 2024 Tsontcho Ianchulev /s/ Rachel Jacobson Director March 18, 2024 Rachel Jacobson /s/ Charles E. Mather IV Director March 18, 2024 Charles E. Mather IV /s/ Ram Palanki Director March 18, 2024 Ram Palanki ​ ​ ​ ​ ​ /s/ Ellen Strahlman Director March 18, 2024 Ellen Strahlman /s/ Michael Geltzeiler ​ Director ​ March 18, 2024 Michael Geltzeiler ​ ​ ​ ​ ​ ​ ​ ​ 104 Table of Contents EYENOVIA, INC. ​ INDEX TO FINANCIAL STATEMENTS ​ ​ Page Number Years Ended December 31, 2023 and 2022 ​ ​ ​ Report of Independent Registered Public Accounting Firm (PCAOB ID: 688) F-2 ​ ​ Balance Sheets as of December 31, 2023 and 2022 F-4 ​ ​ Statements of Operations for the Years Ended December 31, 2023 and 2022 F-5 ​ ​ Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2023 and 2022 F-6 ​ ​ Statements of Cash Flows for the Years Ended December 31, 2023 and 2022 F-7 ​ ​ Notes to Financial Statements F-9 ​ ​ F-1 Table of Contents ​ REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors of Eyenovia, Inc. Opinion on the Financial Statements We have audited the accompanying balance sheets of Eyenovia, Inc. (the “Company”) as of December 31, 2023 and 2022, the related statements of operations, changes stockholders’ equity and cash flows for each of the two years in the period ended December 31, 2023, and the related notes (collectively referred to as 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, 2023 and 2022, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America. Explanatory Paragraph – Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As more fully described in Note 2, the Company has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters. /s/ Marcum LLP ​ F-2 Table of Contents Marcum LLP ​ We have served as the Company’s auditor since 2017. ​ New York, NY March 18, 2024 F-3 Table of Contents EYENOVIA, INC. Balance Sheets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ 2023 2022 Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current Assets ​ ​ ​ ​ Cash and cash equivalents ​ $ 14,849,057 ​ $ 22,863,520 Inventories ​ ​ 109,798 ​ ​ — Deferred clinical supply costs ​ ​ 4,256,793 ​ ​ 2,284,931 License fee and expense reimbursements receivable ​ ​ 123,833 ​ ​ 1,183,786 Security deposits, current ​ ​ 1,506 ​ ​ 119,550 Prepaid expenses and other current assets ​ ​ 1,365,731 ​ 1,190,719 Total Current Assets ​ ​ 20,706,718 ​ 27,642,506 ​ ​ ​ ​ ​ ​ ​ Property and equipment, net ​ ​ 3,374,384 ​ 1,295,115 Security deposits, non-current ​ ​ 197,168 ​ 80,874 Intangible assets ​ ​ 2,122,945 ​ ​ — Operating lease right-of-use asset ​ ​ 1,666,718 ​ ​ 1,291,592 Equipment deposits ​ ​ 711,441 ​ ​ 726,326 Total Assets ​ $ 28,779,374 ​ $ 31,036,413 ​ ​ ​ ​ ​ ​ ​ Liabilities and Stockholders’ Equity ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current Liabilities: ​ ​ ​ ​ Accounts payable ​ $ 1,753,172 ​ $ 1,428,283 Accrued compensation ​ ​ 1,658,613 ​ 1,747,191 Accrued expenses and other current liabilities ​ ​ 287,928 ​ 503,076 Operating lease liabilities - current portion ​ ​ 501,250 ​ ​ 484,882 Notes payable - current portion, net of debt discount of $ 503,914 and $ 33,885 as of December 31, 2023 and 2022, respectively ​ ​ 5,329,419 ​ ​ 174,448 Convertible notes payable - current portion, net of debt discount of $ 0 and $ 33,885 as of December 31, 2023 and 2022, respectively ​ ​ — ​ ​ 174,448 ​ ​ ​ ​ ​ ​ ​ Total Current Liabilities ​ ​ 9,530,382 ​ 4,512,328 ​ ​ ​ ​ ​ ​ ​ Operating lease liabilities - non-current portion ​ ​ 1,292,667 ​ ​ 907,644 Notes payable - non-current portion, net of debt discount of $ 448,367 and $ 813,229 as of December 31, 2023 and 2022, respectively ​ ​ 4,355,800 ​ ​ 4,190,938 Convertible notes payable - non-current portion, net of debt discount of $ 398,569 and $ 813,229 as of December 31, 2023 and 2022, respectively ​ ​ 4,601,431 ​ ​ 4,190,938 ​ ​ ​ ​ ​ ​ ​ Total Liabilities ​ ​ 19,780,280 ​ 13,801,848 ​ ​ ​ ​ ​ ​ ​ Commitments and contingencies (Note 9) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stockholders' Equity: ​ ​ ​ ​ Preferred stock, $ 0.0001 par value, 6,000,000 shares authorized; ​ ​ ​ ​ 0 shares issued and outstanding as of December 31, 2023 and 2022 ​ ​ ​ ​ ​ Common stock, $ 0.0001 par value, 90,000,000 shares authorized; 45,553,026 and 36,668,980 shares issued and outstanding as of December 31, 2023 and 2022, respectively ​ ​ 4,555 ​ 3,667 Additional paid-in capital ​ ​ 154,486,098 ​ 135,461,361 Accumulated deficit ​ ​ ( 145,491,559 ) ​ ( 118,230,463 ) ​ ​ ​ ​ ​ ​ ​ Total Stockholders’ Equity ​ ​ 8,999,094 ​ 17,234,565 ​ ​ ​ ​ ​ ​ ​ Total Liabilities and Stockholders’ Equity ​ $ 28,779,374 ​ $ 31,036,413 ​ The accompanying notes are an integral part of these financial statements. ​ F-4 Table of Contents EYENOVIA, INC. Statements of Operations ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ December 31, ​ 2023 2022 Operating Income ​ ​ ​ ​ ​ ​ Revenue ​ $ 3,787 ​ $ — Cost of revenue ​ ​ ( 3,787 ) ​ ​ — Gross Profit ​ ​ — ​ ​ — ​ ​ ​ ​ ​ ​ ​ Operating Expenses: ​ ​ Research and development ​ ​ 12,975,832 ​ ​ 13,378,680 General and administrative ​ 12,430,614 ​ 13,532,835 Total Operating Expenses ​ 25,406,446 ​ 26,911,515 ​ ​ ​ ​ ​ ​ ​ Loss From Operations ​ ( 25,406,446 ) ​ ( 26,911,515 ) ​ ​ ​ ​ ​ ​ ​ Other (Expense) Income: ​ ​ ​ ​ Other (expense) income , net ​ ​ ( 176,411 ) ​ ​ 197,090 Interest expense ​ ​ ( 2,371,851 ) ​ ​ ( 1,380,058 ) Interest income ​ 693,612 ​ 83,326 Total Other Expense ​ ​ ( 1,854,650 ) ​ ​ ( 1,099,642 ) ​ ​ ​ ​ ​ ​ ​ Net Loss ​ $ ( 27,261,096 ) ​ $ ( 28,011,157 ) ​ ​ ​ ​ ​ ​ ​ Net Loss Per Share - Basic and Diluted ​ $ ( 0.66 ) ​ $ ( 0.83 ) ​ ​ ​ ​ ​ ​ ​ Shares Outstanding - Basic and Diluted ​ 41,032,970 ​ 33,649,747 ​ The accompanying notes are an integral part of these financial statements. ​ ​ F-5 Table of Contents EYENOVIA, INC. Statements of Changes in Stockholders’ Equity ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended December 31, 2023 and 2022 ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ Total ​ ​ Common Stock ​ Paid-In ​ Accumulated ​ Stockholders' ​ Shares Amount Capital Deficit Equity ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance - January 1, 2022 28,426,616 ​ $ 2,844 ​ $ 110,683,077 ​ $ ( 90,219,306 ) ​ $ 20,466,615 Issuance of common stock and warrants in direct offering [1] ​ 3,000,000 ​ ​ 300 ​ ​ 14,897,608 ​ ​ — ​ ​ 14,897,908 Issuance of common stock in debt financing [2] ​ 547,807 ​ ​ 54 ​ ​ 859,679 ​ ​ — ​ ​ 859,733 Origination costs related to equity in debt financing ​ — ​ ​ — ​ ​ ( 44,375 ) ​ ​ — ​ ​ ( 44,375 ) Issuance of common stock in At the Market offering [3] ​ 2,716,061 ​ ​ 271 ​ ​ 5,281,505 ​ ​ — ​ ​ 5,281,776 Exercise of pre-funded stock warrants ​ 1,870,130 ​ ​ 187 ​ ​ 18,514 ​ ​ — ​ ​ 18,701 Stock-based compensation — ​ — ​ 3,765,364 ​ — ​ 3,765,364 Issuance of common stock related to vested restricted stock units ​ 108,366 ​ ​ 11 ​ ​ ( 11 ) ​ ​ — ​ ​ — Net loss — ​ — ​ — ​ ( 28,011,157 ) ​ ( 28,011,157 ) Balance - December 31, 2022 36,668,980 ​ ​ 3,667 ​ ​ 135,461,361 ​ ​ ( 118,230,463 ) ​ ​ 17,234,565 Issuance of common stock and warrants in registered direct offering [4][8] ​ 4,198,633 ​ ​ 420 ​ ​ 10,885,694 ​ ​ — ​ ​ 10,886,114 Issuance of common stock as consideration for licensing agreement [5] ​ 487,805 ​ ​ 49 ​ ​ 999,951 ​ ​ — ​ ​ 1,000,000 Exercise of pre-funded stock warrants ​ 2,252,979 ​ ​ 225 ​ ​ 22,304 ​ ​ — ​ ​ 22,529 Issuance of common stock in At the Market offering [6] ​ 1,866,147 ​ ​ 187 ​ ​ 4,591,705 ​ ​ — ​ ​ 4,591,892 Cashless exercise of stock options ​ 20,749 ​ ​ 2 ​ ​ ( 2 ) ​ ​ — ​ ​ — Exercise of stock options ​ 10,000 ​ ​ 1 ​ ​ 27,199 ​ ​ — ​ ​ 27,200 Stock-based compensation ​ — ​ ​ — ​ ​ 2,497,890 ​ ​ — ​ ​ 2,497,890 Issuance of common stock related to vested restricted stock units ​ 47,733 ​ ​ 4 ​ ​ ( 4 ) ​ ​ — ​ ​ — Warrant modification - incremental value [7] ​ — ​ ​ — ​ ​ 1,738,700 ​ ​ — ​ ​ 1,738,700 Warrant modification - in issuance costs for registered direct offering [8] ​ — ​ ​ — ​ ​ ( 1,738,700 ) ​ ​ — ​ ​ ( 1,738,700 ) Net loss ​ — ​ ​ — ​ ​ — ​ ​ ( 27,261,096 ) ​ ​ ( 27,261,096 ) Balance - December 31, 2023 ​ 45,553,026 ​ $ 4,555 ​ $ 154,486,098 ​ $ ( 145,491,559 ) ​ $ 8,999,094 [1] Includes gross proceeds of $ 14,981,299 less total issuance costs of $ 83,391 . [2] Relative fair value of stock issued in connection with debt. [3] Includes gross proceeds of $ 5,445,130 less total issuance costs of $ 163,354 . [4] Includes gross proceeds of $ 11,977,468 less total cash issuance costs of $ 1,091,354 . [5] Shares issued as partial consideration for License Agreement with Formosa Pharmaceuticals Inc. [6] Includes gross proceeds of $ 4,733,909 less total issuance costs of $ 142,017 . [7] Warrant originally granted in the March 2022 offering was modified in connection with the registered direct offering. [8] Warrant modification in connection with registered direct offering accounted for as a non-cash issuance cost of the registered direct offering, but is presented on a separate line item for clarity. The accompanying notes are an integral part of these financial statements. ​ ​ F-6 Table of Contents EYENOVIA, INC. Statements of Cash Flows ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ December 31, ​ 2023 2022 Cash Flows From Operating Activities ​ ​ ​ ​ Net loss ​ $ ( 27,261,096 ) ​ $ ( 28,011,157 ) Adjustments to reconcile net loss to net cash ​ ​ ​ ​ used in operating activities: ​ ​ ​ ​ Stock-based compensation ​ 2,497,890 ​ 3,765,364 Depreciation of property and equipment ​ 783,208 ​ 307,430 Amortization of debt discount ​ ​ 681,860 ​ ​ 411,918 Write-off of property and equipment ​ ​ — ​ ​ 209,040 Write-down of inventories to net realizable value ​ ​ 12,218 ​ ​ — Provision for clinical supplies to be returned ​ ​ 400,000 ​ ​ — Non-cash rent expense ​ ​ 529,311 ​ ​ 474,778 Changes in operating assets and liabilities: ​ ​ ​ ​ Prepaid expenses and other current assets ​ 434,128 ​ 219,555 License fee and expense reimbursements receivables ​ ​ 1,059,953 ​ ​ 621,279 Deferred clinical supply costs ​ ​ ( 2,271,862 ) ​ ​ ( 2,284,931 ) Inventories ​ ​ ( 122,016 ) ​ ​ — Security and equipment deposits ​ ​ 1,750 ​ ​ ( 81,389 ) Accounts payable ​ 324,889 ​ ( 185,821 ) Accrued compensation ​ ( 88,578 ) ​ 203,573 Accrued expenses and other current liabilities ​ ( 315,148 ) ​ ( 342,643 ) Lease liabilities ​ ​ ( 503,046 ) ​ ​ ( 412,478 ) Net Cash Used In Operating Activities ​ ( 23,836,539 ) ​ ( 25,105,482 ) ​ ​ ​ ​ ​ ​ ​ Cash Flows From Investing Activities ​ ​ ​ ​ Purchases of property and equipment ​ ( 2,847,592 ) ​ ( 540,360 ) Vendor deposits for property and equipment ​ ​ — ​ ​ ( 334,385 ) Investment in intangible asset ​ ​ ( 1,122,945 ) ​ ​ — Net Cash Used In Investing Activities ​ ( 3,970,537 ) ​ ( 874,745 ) ​ ​ ​ ​ ​ ​ ​ Cash Flows From Financing Activities ​ ​ ​ ​ Proceeds from sale of common stock and warrants in direct offering [1][2] ​ 11,977,468 ​ 14,981,299 Payment of offering issuance costs ​ ​ ( 1,091,354 ) ​ ​ ( 83,391 ) Proceeds from sale of common stock in At the Market offering ​ 4,733,909 ​ 5,445,130 Payment of issuance costs for At the Market offering ​ ​ ( 142,017 ) ​ ​ ( 163,354 ) Proceeds from exercise of stock options ​ ​ 27,200 ​ ​ — Proceeds from exercise of stock warrants ​ ​ 22,529 ​ ​ 18,701 Proceeds from note payable and equity issued to Avenue ​ ​ 5,000,000 ​ ​ 10,000,000 Payment of issuance costs for equity issued to Avenue ​ ​ — ​ ​ ( 46,836 ) Payment of issuance costs for notes issued to Avenue ​ ​ ( 125,982 ) ​ ​ ( 469,320 ) Repayments of notes payable ​ ​ ( 609,140 ) ​ ​ ( 8,175,332 ) ​ ​ ​ ​ ​ ​ ​ Net Cash Provided By Financing Activities ​ 19,792,613 ​ 21,506,897 ​ ​ ​ ​ ​ ​ ​ Net Decrease in Cash and Cash Equivalents ​ ( 8,014,463 ) ​ ( 4,473,330 ) ​ ​ ​ ​ ​ ​ ​ Cash and Cash Equivalents - Beginning of Year ​ 22,863,520 ​ 27,336,850 ​ ​ ​ ​ ​ ​ ​ Cash and Cash Equivalents - End of Year ​ $ 14,849,057 ​ $ 22,863,520 ​ The accompanying notes are an integral part of these financial statements. ​ F-7 Table of Contents EYENOVIA, INC. Statements of Cash Flows, continued ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ December 31, ​ ​ 2023 ​ 2022 Supplemental Disclosure of Cash Flow Information: ​ ​ ​ ​ ​ ​ Cash paid during the year for: ​ ​ ​ ​ ​ ​ Interest ​ $ 1,690,548 ​ $ 315,550 ​ ​ ​ ​ ​ ​ ​ Supplemental Disclosure of Non-Cash Investing and Financing Activities ​ ​ ​ ​ Purchase of insurance policy financed by note payable ​ $ 609,140 ​ $ 675,332 Recognition of right-of-use asset for lease liability upon adoption of ASU 2016-02 ​ $ — ​ $ 618,906 Right-of-use assets obtained in exchange for lease liabilities ​ $ — ​ $ 1,186,098 Right-of-use assets and lease liabilities recognized upon lease renewal ​ $ 904,437 ​ $ — Vendor deposits applied to purchases of property and equipment ​ $ 14,885 ​ $ — Original issue discount on notes payable ​ $ 212,500 ​ $ — Warrant modification - incremental value ​ $ 1,738,700 ​ $ — Issuance of common stock as consideration for licensing agreement ​ $ 1,000,000 ​ $ — Cashless exercise of stock options ​ $ 2 ​ $ — Common shares issued recorded as debt discount for Avenue Loan ​ $ — ​ $ 859,733 Issuance of common stock related to vested restricted stock units ​ $ 4 ​ $ 11 [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 financial statements. ​ ​ F-8 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Note 1 – Business Organization and Nature of Operations Eyenovia, Inc., (“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 as well as out-licensing for additional indications. Eyenovia’s aim is to improve the delivery of topical ophthalmic medication through ergonomic design that facilitates ease-of-use and delivery of more physiologically appropriate medication volume, with the goal to reduce side effects and improve tolerability, and introduce digital health technology to improve therapy compliance and ultimately medical outcomes. The ergonomic and functional design of the Optejet® allows for horizontal drug delivery and eliminates the need to tilt the head back or the manual dexterity to squeeze a bottle to administer medications. Drug is delivered in a microscopic array of droplets faster than the blink reflex to help ensure instillation success. The precise delivery of a low-volume columnar spray by the Optejet® device minimizes contamination with a non-protruding nozzle and self-closing shutter. In clinical trials, the Optejet® has demonstrated that its targeted delivery achieves a high rate of successful administration, with 98 % of sprays being accurately delivered upon first attempt compared to the established rate reported with traditional eye drops of ~ 50 %. A more physiologically appropriate volume of medication in the range of seven to nine microliters is delivered by the Optejet, approximately one fifth of the 35 to 50 microliter dose typically delivered in a single eye drop. Lower volume of medication exposes the ocular surface to less active ingredient and preservatives, potentially reducing ocular stress and surface damage and improving tolerability. The lower volume also minimizes the potential for drug to enter systemic circulation, with the goal of avoiding some common side effects that are related to overdosing of the eye. Versions of the Optejet are being developed with on-board digital technology to provide reminders via Bluetooth to smart devices and date and time stamp device use. This information can then be used by practitioners and health care systems to measure treatment compliance and improve medical decision making. In this way, the Optejet could serve as an extension of the physician’s office by providing information that is not currently possible to collect except through the use of diaries. To address unmet medical needs, the Company is developing the next generation of smart ophthalmic therapeutics to target new indications or new combinations where there are currently no or few drug therapies approved by the U.S. Food and Drug Administration, or FDA. The Company’s investigational products are classified by the 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. ​ Note 2 – Summary of Significant Accounting Policies Liquidity and Going Concern As of December 31, 2023, the Company had unrestricted cash and cash equivalents of approximately $ 14.8 million and an accumulated deficit of approximately $ 145.5 million. For the years ended December 31, 2023 and 2022, the Company incurred net losses of approximately $ 27.3 million and $ 28.0 million, respectively, and used cash in operations of approximately $ 23.8 million and $ 25.1 million, respectively. The Company does not have recurring revenue and has not yet achieved profitability. The Company expects to continue to incur cash outflows from operations for the near future. The Company expects that its research and development and general and administrative expenses will continue to increase and, as a result, it 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. Implementation of the Company’s plans and its ability to continue as a going concern will depend upon the Company’s ability to generate sufficient recurring revenues or the Company’s ability to raise further capital, through the sale of additional equity or debt securities or otherwise, to support its future operations. The Company’s operating needs include the planned costs to operate its business, including amounts required to fund working capital and capital expenditures. The Company’s future capital requirements and the adequacy of its available funds will depend on many factors, including the Company’s ability to successfully commercialize its products and services, competing technological and market developments, and the need to enter into collaborations with other companies, or acquire other companies or technologies to enhance or complement its product and service offerings. If the Company is unable to generate sufficient recurring revenues or secure additional capital, it may be required to curtail its research and development initiatives and take additional measures to reduce costs in order to conserve its cash. Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Use of Estimates Preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or U.S. GAAP, requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and the amounts disclosed in the related notes to the financial statements. The Company bases its estimates and judgments on historical experience and on various other assumptions that it believes are reasonable under the circumstances. The amounts of assets and liabilities reported in the Company’s balance sheets and the amounts of expenses reported for each of the periods presented are affected by estimates and assumptions, which are used for, but not limited to, fair value calculations for equity securities, establishment of valuation allowances for deferred tax assets, revenue recognition, the recoverability and useful lives of long-lived assets, the realization of inventories and deferred clinical supply costs, the recovery of deferred costs and the deferral of revenues. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that actual results could differ from those estimates. See Note 2 - Summary of Significant Accounting Policies — Stock-Based Compensation for additional discussion of the use of estimates in estimating the fair value of the Company’s common stock. 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 December 31, 2023 and 2022, the Company had Treasury bills with original maturity dates of three months or less in the amount of $ 5,450,118 and $ 0 , respectively. 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 December 31, 2023 and 2022, the Company had cash and cash equivalent balances in excess of FDIC insurance limits of $ 14,243,870 and $ 22,613,520 , respectively. On March 10, 2023, Silicon Valley Bank (“SVB”), was closed by the California Department of Financial Protection and Innovation, and the FDIC was appointed as receiver. The Company has deposit accounts at SVB. The standard deposit insurance amount is up to $ 250,000 per depositor, per insured bank, for each account ownership category. As of December 31, 2023, the Company had approximately $ 106,000 in deposit accounts at SVB. Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation, which is recorded commencing at the in-service date using the straight-line method at rates sufficient to charge the cost of depreciable assets to operations over their estimated useful lives, which range from 1 to 10 years . Leasehold improvements are amortized over the lesser of (a) the useful life of the asset; or (b) the remaining lease term. Maintenance and repairs are charged to operations as incurred. The Company capitalizes costs attributable to the betterment of property and equipment when such betterment extends the useful life of the assets. Vendor deposits toward the purchase of property and equipment are reflected as equipment deposits on the accompanying balance sheets. The Company commences depreciation of assets when they are placed in service. Impairment of Long-lived Assets The Company reviews for the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. An impairment would be recognized when estimated future cash flows expected to result from the use of the asset and its eventual disposition are less than its carrying amount. The Company did not record any impairment losses during the years ended December 31, 2023 and 2022. F-10 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Fair Value of Financial Instruments The Company measures the fair value of financial assets and liabilities based on Accounting Standards Codification, or ASC Topic 820 “Fair Value Measurements and Disclosures”, or ASC 820, which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1 — quoted prices in active markets for identical assets or liabilities; Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable; and Level 3 — inputs that are unobservable (for example, cash flow modeling inputs based on assumptions). The carrying amounts of the Company’s financial instruments, such as cash and cash equivalents, restricted cash, accounts payable, and notes payable approximate fair values due to the short-term nature or effective interest rates of these instruments. Income Taxes The Company is subject to Federal, New York State and City, and State of California income taxes and files tax returns in those jurisdictions. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of items that have been included or excluded in the financial statements or tax returns. Deferred tax assets and liabilities are determined on the basis of the difference between the tax basis of assets and liabilities and their respective financial reporting amounts, or temporary differences, at enacted tax rates in effect for the years in which such temporary differences are expected to reverse. The Company utilizes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company’s policy is to classify assessments, if any, for tax-related interest as interest expense and penalties as general and administrative expenses in the statements of operations. Revenue Recognition The Company’s revenues are generated primarily through research, development and commercialization agreements. The terms of such agreements may contain multiple promised goods and services, which may include (i) licenses to its intellectual property, and (ii) in certain cases, payment in connection with the manufacturing and delivery of clinical supply materials. Payments to the Company under these arrangements typically include one or more of the following: non-refundable, upfront license fees; milestone payments; payments for clinical product supply, and royalties on future product sales. The Company analyzes its arrangements to assess whether such arrangements involve joint operating activities. For collaboration arrangements that are deemed to be within the scope of ASC Topic 808, “Collaborative Arrangements”, or ASC 808, the Company allocates the contract consideration between such joint operating activities and elements that are reflective of a vendor-customer relationship and, therefore, within the scope of ASC Topic 606, “Revenue from Contracts with Customers”, or ASC 606. The Company’s policy is to recognize amounts allocated to joint operating activities as a reduction in research and development expense. F-11 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Under ASC 606, the Company recognizes revenue when its customers obtain control of promised goods or services, in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: ● Step 1: Identify the contract with the customer; ● Step 2: Identify the performance obligations in the contract; ● Step 3: Determine the transaction price; ● Step 4: Allocate the transaction price to the performance obligations in the contract; and ● Step 5: Recognize revenue when the company satisfies a performance obligation. The Company recognizes revenue primarily from the following type of contract: Product sales – Revenue is recognized at the point in time the customer obtains control of the goods and the Company satisfies its performance obligation, which is generally at the time it ships the product to the customer. The Company must make significant judgments in its revenue recognition process, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each performance obligation. Milestone payments represent variable consideration that will be recognized when the performance obligation is achieved. Sales-based royalty payments derived from usage of intellectual property are recognized when those sales occur. Arrangements that include rights to additional goods or services that are exercisable at a customer’s discretion are generally considered discretionary purchase options. The Company assesses if these options provide a material right to the customer and if so, they are considered performance obligations. During 2020, the Company entered into a license agreement, or the Arctic Vision License Agreement, with Arctic Vision (Hong Kong) Limited, or Arctic Vision, and a license agreement, or the Bausch License Agreement, with Bausch Health Companies, Inc., or Bausch + Lomb. Each license has three revenue components: 1) an upfront license fee; 2) milestone payments and 3) royalty payments. Arctic Vision License Agreement On August 10, 2020, the Company entered into the Arctic Vision License Agreement pursuant to which Arctic Vision may develop and commercialize MicroPine for the treatment of progressive myopia and MicroLine for the treatment of presbyopia in Greater China (mainland China, Hong Kong, Macau and Taiwan) and South Korea. On September 14, 2021, the Company and Arctic Vision executed Amendment 1 to the Arctic Vision License Agreement pursuant to which Arctic Vision may develop and commercialize MicroStat for the treatment of mydriasis in Greater China and South Korea. Milestone Payments The Company may receive up to $ 37.7 million in milestone payments in connection with the Arctic Vision License Agreement, as amended, based on various development and regulatory milestones, including the initiation of clinical research and regulatory approvals in Greater China and South Korea, related to the filing of marketing authorization applications of approximately $ 13.2 million and the receipt of regulatory approvals of approximately $ 24.5 million. The Company currently anticipates the remaining milestone related performance obligations to be achieved between late 2024 and late 2025. F-12 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Royalty Payments Arctic Vision also will purchase its supply of MicroPine, MicroLine and MicroStat from the Company or, for such products not supplied by the Company, pay the Company a mid-single digit percentage royalty on net sales of such products, subject to certain adjustments. No royalty payments were earned through December 31, 2023. The Company will pay a percentage in the range from 30 % to 40 % of such payments, royalties, or net proceeds of such supply to Senju pursuant to the Senju License Agreement. See Note 10—Related Party Transactions—Senju License Agreement for additional details. Bausch License Agreements On October 9, 2020, the Company entered into the Bausch License Agreement pursuant to which Bausch + Lomb may develop and commercialize the Bausch Licensed Product in the Licensed Territory. Bausch + Lomb could terminate the Bausch License Agreement, with respect to the Bausch Licensed Product to either country in the Licensed Territory, at any time for convenience upon 90 days ’ written notice. On January 12, 2024, the Company and Bausch + Lomb entered into a Letter Agreement (the “Letter Agreement”), pursuant to which Eyenovia will reacquire the rights to the Bausch Licensed Product (see Note 13 – Subsequent Events). The terms of the agreement include the transfer of the rights and certain assets relating to the Bausch Licensed Product from Bausch + Lomb to the Company in exchange for cash and common stock consideration. In addition, under the terms of the Letter Agreement, the Company has also agreed to pay Bausch + Lomb a low single-digit royalty on its net sales of the Bausch Licensed Product in the United States and Canada for a period of ten years from the date of the first commercial sale by the Company (or its affiliates or licensees) of the Bausch Licensed Product in the United States. Under the Letter Agreement, (i) the Company will re-acquire any and all licenses and other rights granted by the Company to Bausch + Lomb under the original Bausch License Agreement, (ii) any and all licenses and other rights granted by Bausch + Lomb to the Company under the License Agreement are terminated, other than as set forth in the Letter Agreement, and (iii) other than as set forth in the Letter Agreement, Bausch + Lomb is released from all of their ongoing obligations under the License Agreement, including development and commercialization obligations. In connection with the entry into the Letter Agreement, the Company will issue Bausch + Lomb $ 3.0 million in shares of the Company’s common stock, within ten business days of the completion of the Regulatory Transfers. Under the Letter Agreement, the Company has also agreed to pay Bausch + Lomb an upfront payment of $ 2.0 million in cash. Clinical Supply Arrangements Bausch + Lomb and Arctic Vision had 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. Based on the Letter Agreement with Bausch + Lomb referenced above, the arrangement with Bausch + Lomb is terminated. The arrangement with Arctic Vision is still in place. The Company’s licensing agreement with Arctic Vision represent collaborative arrangements and they are not a customer 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) report the net income from the clinical supply arrangements as other income. Deferred clinical supply costs were $ 4.3 million and $ 2.3 million at December 31, 2023 and 2022, respectively. Net income from the sale of clinical supplies was included in other income and amounted to $ 0.2 million for each of the years ended December 31, 2023 and 2022, but a $ 0.4 million provision for possible product returns was also charged against the results for the year ended December 31, 2023. This provision was for the cost to replace or rework the defective clinical supply product. See Note 9 – Commitments and Contingencies – Clinical Supply Returns. Inventories 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. F-13 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Inventory is primarily comprised of drug-device combination products, which are available for commercial sale, as follows: ​ ​ ​ ​ ​ ​ December 31, ​ ​ 2023 Finished goods ​ $ 30,683 Work-in-process ​ — Raw materials ​ 79,115 Total inventory ​ $ 109,798 ​ 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. 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 suspension, 0.05 %, which was approved 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 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. Operating Leases The Company adopted the Accounting Standards Update, or ASU 2016-02,“Leases (Topic 842)” as of December 31, 2022, effective January 1, 2022. The Company leases its facilities under non-cancellable operating leases. The Company evaluates the nature of each lease at the inception of an arrangement to determine whether it is an operating or financing lease and recognizes the right-of-use asset and lease liabilities based on the present value of future minimum lease payments over the expected lease term. The Company recognizes a liability to make lease payments, the “lease liability”, and an asset representing the right to use the underlying asset during the lease term, the “right-of-use asset”. The lease liability is measured at the present value of the remaining lease payments, discounted at the Company’s incremental borrowing rate. The Company’s leases do not generally contain an implicit interest rate and therefore the Company uses the incremental borrowing rate it would expect to pay to borrow on a similar collateralized basis over a similar term in order to determine the present value of its lease payments. The right-of-use asset is measured at the amount of the lease liability adjusted for the remaining balance of any lease incentives received, any cumulative prepaid or accrued rent if the lease payments are uneven throughout the lease term, any unamortized initial direct costs, and any impairment of the right-of-use-asset. Operating lease expense consists of a single lease cost calculated so that the remaining cost of the lease is allocated over the remaining lease term on a straight-line basis, variable lease payments not included in the lease liability, and any impairment of the right-of-use asset. Research and Development Research and development expenses are charged to operations as incurred. The Company records prepaid expenses on its balance sheet for the payment of research and development expenses in advance of services being provided. F-14 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ The Company’s license agreements were determined to represent collaborative arrangements. Pursuant to these collaborative arrangements, the licensee is required to reimburse the Company for certain research and development expenses. Providing research and development activities in the context of a collaboration agreement is not an ordinary activity for the Company. Accordingly, the licensee is not a customer with respect to the reimbursements and such payments are not subject to ASC 606 – Revenue Recognition. The Company’s policy is to recognize the reimbursements as contra – research and development expense. The receivable for such payments, plus other license payments, is included in “license fee and expense reimbursements receivable” on the accompanying balance sheets. Stock-Based Compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. The fair value of the award is measured on the grant date and the fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. Upon the exercise of an option, the Company issues new shares of common stock out of the shares reserved for issuance under its equity plans. See Note 11 – Stockholders’ Equity – Stock Options for additional information related to estimating the fair value of stock options. Net Loss Per Share of Common Stock Basic net loss per share of common stock is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period, plus fully vested shares that are subject to issuance for little or no monetary consideration. Diluted loss per share reflects the potential dilution that could occur if securities or other instruments to issue common stock were exercised or converted into common stock. The following table presents the computation of basic and diluted net loss per common share: ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ December 31, ​ 2023 2022 Numerator: ​ ​ Net income (loss) ​ $ ( 27,261,096 ) ​ $ ( 28,011,157 ) Net loss attributable to common stockholders ​ $ ( 27,261,096 ) ​ $ ( 28,011,157 ) ​ ​ ​ ​ ​ ​ ​ Denominator (weighted average quantities): ​ ​ ​ ​ ​ ​ Common shares issued ​ 39,907,873 ​ 33,252,644 Add: Prefunded warrants ​ 1,042,033 ​ 333,037 Add: Undelivered vested restricted shares ​ 83,064 ​ 64,066 Denominator for basic and diluted net loss per share ​ 41,032,970 ​ 33,649,747 ​ ​ ​ ​ ​ ​ ​ Basic and diluted net loss per common share ​ $ ( 0.66 ) ​ $ ( 0.83 ) ​ The following securities are excluded from the calculation of weighted average dilutive shares of common stock because their inclusion would have been anti-dilutive: ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ 2023 2022 Warrants 10,926,554 6,087,845 Options 5,306,377 5,380,553 Convertible notes 2,327,747 — Restricted stock units 106,019 172,800 Total potentially dilutive shares 18,666,697 11,641,198 ​ F-15 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Subsequent Events The Company has evaluated subsequent events through the date which the financial statements were issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the financial statements, except as disclosed. Recently Issued Accounting Standards In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this update address investor requests for more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information. This update also includes certain other amendments to improve the effectiveness of income tax disclosures. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of this standard, but does not expect it to have a material impact on its financial statements. Recently Adopted Accounting Standards In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326)” and also issued subsequent amendments to the initial guidance under ASU 2018-19, ASU 2019-04 and ASU 2019-05 (collectively, “Topic 326”). Topic 326 requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. This replaces the existing incurred loss model with an expected loss model and requires the use of forward-looking information to calculate credit loss estimates. The Company adopted ASU 2016-13 on January 1, 2023. The adoption of ASU 2016-13 did not have a material impact on the Company’s financial position, results of operations or cash flows. In August 2020, the FASB issued ASU 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20)” and “Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40): 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. Limiting the accounting models will result in fewer embedded conversion features being separately recognized from the host contract. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in-capital. In addition, ASU 2020-06 improves disclosure requirements for convertible instruments and earnings-per-share guidance. ASU 2020-06 also revises the derivative scope exception guidance to reduce form-over-substance-based accounting conclusions driven by remote contingent events. The amendments in this update are effective for the Company in fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. Early adoption is permitted. The Company early adopted ASU 2020-06 effective January 1, 2023 which eliminates the need to assess whether a beneficial conversion feature needs to be recognized upon the issuance of new convertible instruments. The adoption of ASU 2020-06 did not have a material impact on the Company’s financial position, results of operations or cash flows. ​ F-16 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Note 3 – Prepaid Expenses and Other Current Assets As of December 31, 2023 and 2022, prepaid expenses and other current assets consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ 2023 2022 Payroll tax receivable ​ $ 500,684 ​ $ 660,891 Prepaid research and development expenses ​ ​ 421,056 ​ ​ 2,521 Prepaid insurance expenses ​ ​ 167,338 ​ ​ 201,082 Prepaid conference expenses ​ 123,556 ​ 97,743 Prepaid general and administrative expenses ​ ​ 85,938 ​ ​ 87,982 Prepaid patent expenses ​ ​ 48,409 ​ ​ 38,796 Prepaid rent and security deposit ​ ​ 18,750 ​ ​ 74,959 Other ​ ​ — ​ ​ 26,745 Total prepaid expenses and other current assets ​ $ 1,365,731 ​ $ 1,190,719 ​ ​ Note 4 - Property and Equipment, Net As of December 31, 2023 and 2022, property and equipment consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ 2023 2022 Equipment ​ $ 3,038,651 ​ $ 1,361,783 Leasehold improvements ​ ​ 1,754,779 ​ ​ 569,170 ​ ​ 4,793,430 ​ 1,930,953 Less: accumulated depreciation and amortization ​ ( 1,419,046 ) ​ ( 635,838 ) Property and equipment, net ​ $ 3,374,384 ​ $ 1,295,115 ​ ​ ​ ​ ​ Equipment not yet placed in service ​ $ 711,441 ​ $ 726,326 ​ Depreciation expense was $ 783,208 and $ 307,430 for the years ended December 31, 2023 and 2022, respectively, of which $ 776,479 and $ 301,205 , respectively, was included within research and development expenses and $ 6,729 and $ 6,225 , respectively, was included in general and administrative expenses in the accompanying statements of operations. ​ As of December 31, 2023 and 2022, the Company had $ 711,441 and $ 726,326 of outstanding deposits for equipment purchases, which are presented as non-current assets on the balance sheet. ​ Note 5 – Accrued Compensation As of December 31, 2023 and 2022, accrued compensation consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ 2023 2022 Accrued bonus expenses ​ $ 1,302,997 ​ $ 1,447,643 Accrued payroll expenses ​ 355,616 ​ 299,548 Total accrued compensation ​ $ 1,658,613 ​ $ 1,747,191 ​ ​ ​ F-17 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Note 6 – Accrued Expenses and Other Current Liabilities As of December 31, 2023 and 2022, accrued expenses and other current liabilities consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ 2023 2022 Accrued rework of clinical supply returns $ 100,000 $ — Accrued research and development expenses ​ ​ 89,872 ​ ​ 35,524 Accrued professional services ​ 63,028 ​ 320,000 Credit card payable ​ ​ 27,193 ​ ​ 50,639 Other ​ ​ 7,835 ​ ​ 4,385 Accrued leasehold improvements ​ ​ — ​ ​ 92,528 Total accrued expenses and other current liabilities ​ $ 287,928 ​ $ 503,076 ​ ​ Note 7 – Notes Payable and Convertible Notes Payable As of December 31, 2023 and 2022, notes payable and convertible notes payable consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ December 31, 2022 ​ Notes Payable Debt Discount Net Notes Payable Debt Discount Net Current portion: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Avenue - Note payable ​ $ 5,833,333 ​ $ ( 503,914 ) ​ $ 5,329,419 ​ $ 208,333 ​ $ ( 33,885 ) ​ $ 174,448 Avenue - Convertible note payable ​ ​ — ​ ​ — ​ ​ — ​ ​ 208,333 ​ ​ ( 33,885 ) ​ ​ 174,448 Total current portion ​ $ 5,833,333 ​ $ ( 503,914 ) ​ $ 5,329,419 ​ $ 416,666 ​ $ ( 67,770 ) ​ $ 348,896 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-Current portion: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Avenue - Note payable ​ $ 4,804,167 ​ $ ( 448,367 ) ​ $ 4,355,800 ​ $ 5,004,167 ​ $ ( 813,229 ) ​ $ 4,190,938 Avenue - Convertible note payable ​ ​ 5,000,000 ​ ​ ( 398,569 ) ​ ​ 4,601,431 ​ ​ 5,004,167 ​ ​ ( 813,229 ) ​ ​ 4,190,938 Total non-current portion ​ $ 9,804,167 ​ $ ( 846,936 ) ​ $ 8,957,231 ​ $ 10,008,334 ​ $ ( 1,626,458 ) ​ $ 8,381,876 ​ BankDirect Capital Finance Loan On February 24, 2022, the Company issued a note payable in the amount of $ 675,332 for the purchase of a directors and officers’ liability insurance policy. The note payable was payable in six monthly payments consisting of principal and interest amounting to $ 113,628 for an aggregate amount of $ 681,768 . The note accrued interest at a rate of 3.26 % per year and matured on August 24, 2022 . The note payable was repaid in full during the year ended December 31, 2022. Interest expense was $ 6,436 for the year ended December 31, 2022. 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 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. The note payable was repaid in full during the year ended December 31, 2023. Interest expense was $ 12,694 for the year ended December 31, 2023. Silicon Valley Bank Loan On May 7, 2021, or the Effective Date, the Company entered into a Loan and Security Agreement, (the “Loan”), with Silicon Valley Bank, or SVB, for an aggregate principal amount of up to $ 25.0 million. The initial tranche of the Loan, in the amount of $ 7.5 million was received by the Company on May 7, 2021. In connection with the Loan, the Company issued warrants to SVB to purchase 91,884 shares of common stock at an exercise price per share equal to $ 4.76 . The warrants are exercisable for a period of ten years from the date of issuance. The maturity date of the Loan was May 1, 2025 . The Loan indicated a prepayment fee of 2.0 % of the principal balance F-18 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ made on or prior to the second anniversary of the Effective Date. The Loan also provided for a final payment in an amount equal to the original aggregate principal amount of the Loan multiplied by 5.0 %. On September 29, 2021, the Company and SVB executed the First Amendment to the Loan and Security Agreement, (the “Amendment”). In accordance with the Amendment, the Company was required to maintain a collateralized money market account in the amount of $ 7,875,000 . On November 4, 2022, the Company repaid the Loan in full. The full amount of the payment was $ 8,025,000 , and included the principal amount of the loan ($ 7,500,000 ), the final payment ($ 375,000 )and a 2 % prepayment fee ($ 150,000 ). The final payment and prepayment fee were recorded as interest expense. The entire restricted cash account in the amount of $ 7,875,000 was used to make the substantial amount of the payment. During the year ended December 31, 2022, the Company recorded interest expense relating to the Loan of $ 1,174,736 , including the amortization of debt discount of $ 349,632 . Avenue Ventures Loan On November 22, 2022, the Company entered into a Loan and Security Agreement (the “Avenue Loan Agreement”) with Avenue Venture Opportunities Fund, L.P., (“Avenue 1”), and Avenue Venture Opportunities Fund, L.P. II, (“Avenue 2”), and together with Avenue, (the “Lender”), for an aggregate principal amount of up to $ 15,000,000 (the “Avenue Loan”). The initial tranche of the Avenue Loan was $ 10,000,000 , consisting of $ 4,000,000 from Avenue and $ 6,000,000 from Avenue 2. Up to $ 5,000,000 of the principal amount outstanding may be converted at the option of the Lender into shares of the Company’s common stock at a conversion price of $ 2.148 per share, subject to typical anti-dilution adjustments. The Avenue Loan bears interest at an annual rate equal to the greater of (A) 7.0 % and (B) the prime rate as reported in The Wall Street Journal plus 4.45 %. The Avenue Loan maturity date is November 1, 2025. The Company was able to request an additional $ 5,000,000 of gross funding between April 1, 2023 and July 31, 2023, subject to agreed-upon conditions. The Company must also make an incremental final payment equal to 4.25 % of the aggregate funding, amounting to a premium of $ 425,000 on the initial tranche. The Company will make monthly interest-only payments during the first twelve months of the Avenue Loan, which could be increased to up to eighteen months upon the achievement of specified performance milestones. Following the interest-only period, the Company will make equal monthly payments of principal and interest until the maturity date, plus interest. If the Company prepays the Avenue Loan, it will be required to pay a prepayment fee of 3 % if the Avenue Loan is prepaid during the first year, 2 % if the Avenue Loan is prepaid during the second year and 1 % if the Avenue Loan is repaid during the third year. ​ On May 22, 2023, pursuant to the Loan and Security Agreement, the Company received an additional tranche of non-convertible debt funding in the amount of $ 5,000,000 . The Company paid approximately $ 126,000 of origination and legal fees connected to this debt funding. The additional funding is subject to the same interest and maturity date as the initial tranche. The additional funding triggered the extension of the interest-only payment period from the original 12 months to 18 months (through May 2024) for the entire outstanding balance due under the Avenue Loan Agreement (initial and additional tranches). Following the interest-only period, the Company will make equal monthly payments of principal until the maturity date, plus interest. The Company must also make a final payment equal to 4.25 % of the additional tranche, amounting to a premium of $ 212,500 on the additional tranche. The total final payment on the aggregate borrowing is $ 637,500 . If the Company prepays the Avenue Loan, it will be required to pay a prepayment fee of 2 % if the Avenue Loan is prepaid during the second year and 1 % if the Avenue Loan is repaid during the third year. ​ The Avenue Loan requires the Company to make and maintain representations and warranties and other agreements that are customary in loan agreements of this type. The Avenue Loan is secured by all of the Company’s assets, including intellectual property. The Avenue Loan also contains customary events of default, including non-payment of principal or interest, violations of covenants, bankruptcy and material judgments. Upon the occurrence of an event of default, all interest and principal immediately become due and payable. In addition, Avenue will have the right to exercise any other right or remedy provided by applicable law. ​ The Company paid a portfolio management fee of 1 % of the total commitment of $ 15,000,000 , or $ 150,000 of cash on December 1, 2022. This has been accounted for as a component of debt discount. ​ F-19 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ In connection with the Avenue Loan, the Company granted an aggregate of 547,807 shares of its common stock to the Lender. Based on the Company’s stock price of $ 1.79 per share on the closing date, the shares have a gross value of $ 980,575 and a relative fair value of $ 859,733 . This is accounted for as a component of debt discount. The following is a breakdown of the allocation of debt discount and origination costs: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Allocation of Debt Discount ​ ​ ​ ​ ​ Withheld ​ Eyenovia ​ ​ ​ ​ ​ ​ ​ ​ ​ Equity ​ ​ ​ ​ From ​ Origination ​ Final ​ Equity ​ Total Debt ​ Issuance ​ ​ Allocation % ​ Proceeds ​ Costs ​ Payment ​ Issued ​ Discount ​ Costs Non-Convertible Note ​ 64.01 % $ 134,112 ​ $ 237,378 ​ $ 637,500 ​ $ 447,391 ​ $ 1,456,381 ​ $ — Convertible Note ​ 30.09 % 122,701 ​ 103,574 ​ — ​ 412,342 ​ 638,617 ​ — Private Placement Shares ​ 5.90 % 24,063 ​ 20,312 ​ — ​ — ​ — ​ 44,375 Total ​ 100.00 % $ 280,876 ​ $ 361,264 ​ $ 637,500 ​ $ 859,733 ​ $ 2,094,997 ​ $ 44,375 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Withheld From Proceeds: ​ ​ ​ ​ ​ ​ ​ ​ Broker Fee ​ $ 250,000 ​ ​ ​ ​ ​ ​ Legal Reimbursement ​ $ 30,876 ​ ​ ​ ​ ​ ​ Total ​ $ 280,876 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Eyenovia Origination Costs: ​ ​ ​ ​ ​ ​ ​ ​ Legal Fee ​ $ 86,264 ​ ​ ​ ​ ​ ​ Avenue Management Fee ​ $ 275,000 ​ ​ ​ ​ ​ ​ Total ​ $ 361,264 ​ ​ ​ ​ ​ ​ ​ The following is a summary of the Avenue loan at December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ Non-Convertible Convertible Total Aggregate loan funding ​ $ 10,000,000 ​ $ 5,000,000 ​ $ 15,000,000 Final payment ​ 637,500 ​ — ​ 637,500 ​ ​ 10,637,500 ​ 5,000,000 ​ 15,637,500 Less: Unamortized debt discount ​ ( 952,281 ) ​ ( 398,569 ) ​ ( 1,350,850 ) ​ ​ 9,685,219 ​ 4,601,431 ​ 14,286,650 Less: Current portion ​ ( 5,329,419 ) ​ — ​ ( 5,329,419 ) Notes Payable, Non-Current ​ $ 4,355,800 ​ $ 4,601,431 ​ $ 8,957,231 ​ During the years ended December 31, 2023 and 2022, the Company recorded interest expense relating to the Loan of $ 2,359,157 (which includes $ 681,860 of amortization of debt discount) and $ 189,510 (which includes $ 62,286 of amortization of debt discount), respectively. ​ F-20 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Note 8 – Income Taxes The provision for income taxes consists of the following (expenses) benefits: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For The Years Ended ​ ​ December 31, ​ ​ 2023 2022 Deferred tax (provision) benefit: ​ ​ ​ ​ ​ ​ Federal ​ $ 5,381,793 $ 5,879,362 State and local ​ ​ ( 849,201 ) ​ ( 208,806 ) ​ ​ ​ 4,532,592 ​ 5,670,556 Change in valuation allowance ​ ​ ( 4,532,592 ) ​ ( 5,670,556 ) Provision for income taxes ​ $ — $ — ​ The provision for income taxes differs from the United States Federal statutory rate as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ For The Years Ended ​ ​ December 31, ​ 2023 2022 Federal statutory rate ( 21.0 ) % ( 21.0 ) % State tax rate, net of federal benefit 0.0 % ( 2.5 ) % Permanent differences 1.2 % 1.6 % Research & development tax credits 0.0 % ( 1.0 ) % Prior period adjustments and other 1.3 % 1.3 % Rate and apportionment changes 1.9 % 1.3 % Change in valuation allowance 16.6 % 20.3 % Effective income tax rate 0.0 % 0.0 % ​ Deferred tax assets consist of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For The Years Ended ​ ​ December 31, ​ 2023 2022 Deferred tax assets: ​ ​ ​ ​ Net operating loss carryforwards ​ $ 23,804,461 ​ $ 20,165,693 Research and development tax credits ​ ​ 528,894 ​ ​ 799,182 Capitalized research and development costs ​ ​ 3,581,962 ​ ​ 2,304,110 Stock-based compensation ​ ​ 2,080,864 ​ ​ 2,089,014 Intangible assets ​ ​ 688,746 ​ ​ 633,151 Lease liability ​ 376,883 ​ 327,276 Total gross deferred tax assets ​ 31,061,809 ​ 26,318,426 Deferred tax liabilities: ​ ​ ​ ​ Property and equipment ​ ( 348,323 ) ​ ( 184,138 ) Right of use asset ​ ( 350,160 ) ​ ( 303,554 ) Deferred tax assets, net before allowance ​ ​ 30,363,326 ​ ​ 25,830,734 Valuation allowance ​ ( 30,363,326 ) ​ ( 25,830,734 ) Deferred tax assets, net ​ $ — ​ $ — ​ ​ ​ ​ ​ ​ ​ Changes in valuation allowance ​ $ ( 4,532,592 ) ​ $ ( 5,670,556 ) ​ F-21 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ As of December 31, 2023, the Company had approximately $ 104,300,000 of domestic federal net operating loss carryforwards, or NOLs, that may be available to offset future federal taxable income. Approximately $ 10,800,000 of those NOLs will expire during the years ranging from 2034 to 2037 . The remaining NOLs of approximately $ 93,500,000 have no expiration dates. Internal Revenue Code Section 382 limits the utilization of approximately $ 35,000,000 of those NOLs to approximately $ 918,000 on an annual basis as a result of ownership changes that occurred through July 15, 2019. As of December 31, 2023, the Company had approximately $ 20,600,000 of state NOLs, of which approximately $ 20,400,000 will expire during the years ranging from 2040 to 2041 , and approximately $ 200,000 will not expire, and had approximately $ 6,400,000 of local NOLs which do not expire. The Company has assessed the likelihood that deferred tax assets will be realized in accordance with the provisions of ASC 740 “Income Taxes Accounting”, or ASC 740. ASC 740 requires that a valuation allowance be established when it is “more likely than not” that all, or a portion of, deferred tax assets will not be realized. The assessment considers all available positive or negative evidence, including the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies. After the performance of such reviews as of December 31, 2023 and 2022, management believes that uncertainty exists with respect to future realization of its deferred tax assets and has, therefore, established a full valuation allowance as of those dates. Management has evaluated and concluded that there were no material uncertain tax positions requiring recognition in the Company’s financial statements as of December 31, 2023 and 2022. The Company does not expect any significant changes in its unrecognized tax benefits within twelve months of the reporting date. No tax audits were commenced or were in process during the years ended December 31, 2023 and 2022. No tax related interest or penalties were incurred during the years ended December 31, 2023 and 2022. The Company’s federal, state and local income tax returns beginning with the year ended December 31, 2020 remain subject to examination. ​ Note 9 – Commitments and Contingencies Employment Agreements On February 14, 2022, the Compensation Committee of the Board approved amendments to the Executive Employment Agreements, (the “Employment Agreement Addendums”), for three executive officers. Each of the Employment Agreement Addendums provides that if the executive’s employment is terminated by the Company without “Cause” or the executive suffers an “Involuntarily Termination” (each as defined in the employment agreements), provided that the executive has signed a full release of all claims, the executive will be entitled to receive: (i) severance pay equal to twelve months of his or her then-current base salary, and (ii) a reimbursement for health insurance benefits under COBRA for the executive and his or her spouse and dependents for a period of twelve months or until the executive becomes eligible for comparable insurance benefits from another employer, whichever is earlier. Transition of Chief Executive Officer On July 27, 2022, the Company announced the appointment of Michael Rowe as its new Chief Executive Officer, or CEO, effective August 1, 2022, with Dr. Tsontcho Ianchulev (the former CEO) becoming Executive Chairman of the Board. Mr. Rowe is also serving as a member of the Board. On July 26, 2022, the Company entered into an Employment Agreement, (the “Employment Agreement”), with Mr. Rowe under which he will serve as Chief Executive Officer of the Company. Under the terms of the Employment Agreement, Mr. Rowe will receive an annual salary of $ 575,000 . He is eligible to receive a cash bonus of up to 60 % of his base salary. Additionally, Mr. Rowe received an option to purchase 440,000 shares of the Company’s common stock, exercisable at $ 1.66 per share, pursuant to the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan, as amended. Mr. Rowe will also continue to participate in any and all benefit plans, from time to time, in effect for senior management, along with vacation, sick and holiday pay in accordance with the Company’s policies established and in effect from time to time. As a result of the change of salary, the aggregate potential severance pay for the executive officers of the Company is approximately $ 1,004,000 . F-22 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ The Company also entered into an agreement with Dr. Ianchulev, or the Executive Chairman Agreement, pursuant to which Dr. Ianchulev will provide medical expertise and consultation related to the Company’s research and development programs, and such other matters as reasonably requested by the Company for an initial period of one year . In consideration for Dr. Ianchulev’s services, the Company has agreed to provide Dr. Ianchulev with a $ 5,000 monthly retainer throughout the term of the agreement, in addition to the compensation payable to all non-employee members of the Board. 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 Company is still working to determine the exact quantity of the defective clinical supply and the cost to replace or rework the product. As of December 31, 2023, the 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, as of December 31, 2023, 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. See Note 13 – Subsequent Events. Operating Leases In April 2022, the Company entered into a new lease agreement for 3,916 square feet in Laguna Hills, California. The new lease term is five years and two months , commencing on June 1, 2022 and expiring on July 31, 2027 . The monthly base rent ranges from $ 9,203 to $ 10,358 per month over the term of the lease. The security deposit is $ 11,400 . The Company’s rent expense for all Laguna Hills space is recorded in general and administrative expense and amounted to $ 118,746 and $ 66,196 for the years ended December 31, 2023 and 2022, respectively. In May 2022, the Company entered into a lease agreement to lease 10,880 square feet of office space in Reno, Nevada. The lease term is five years and four months , commencing on May 23, 2022 and expiring on September 23, 2027 . The monthly base rent ranges from $ 13,056 to $ 16,663 per month over the term of the lease. The security deposit is $ 53,000 . The Company’s rent expense for this space is recorded in research and development expense and amounted to $ 164,950 and $ 169,521 for the years ended December 31, 2023 and 2022, respectively. In February 2023, the Company exercised its options to renew its three leases in Redwood City, California, for a total of approximately 6,700 square feet. The leases were due to expire on August 31, 2023 . The leases were extended from September 1, 2023 to August 31, 2025. The aggregate monthly base rent ranges from $ 15,742 to $ 16,700 per month over the term of the lease. The security deposit is $ 15,000 . The Company’s rent expense for this space is recorded in research and development expense and amounted to $ 192,710 and $ 180,240 for the years ended December 31, 2023 and 2022, respectively. In June 2023, the Company entered into an extension agreement to renew its lease for approximately 3,800 square feet of office space in New York, NY. The lease was due to expire on September 30, 2023 . The lease was extended from November 1, 2023 to December 31, 2026. The monthly base rent ranges from $ 19,633 to $ 21,298 per month over the term of the lease. The security deposit is $ 118,000 . The Company’s rent expense for this space is recorded in general and administrative expense and amounted to $ 233,534 and $ 242,067 for the years ended December 31, 2023 and 2022, respectively. F-23 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ A summary of the Company’s right-of-use assets and liabilities is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ December 31, ​ ​ 2023 ​ 2022 ​ Cash paid for amounts included in the measurement of lease liabilities: ​ ​ ​ ​ ​ ​ Operating cash flows used in operating activities ​ $ 503,046 ​ $ 412,478 ​ ​ ​ ​ ​ ​ ​ ​ ​ Right-of-use assets obtained in exchange for lease obligations ​ ​ ​ ​ ​ ​ Operating leases ​ $ 904,437 ​ $ 1,186,098 ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted Average Remaining Lease Term (Years) ​ ​ ​ ​ ​ ​ Operating leases ​ 3.04 years ​ ​ 3.71 years ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted Average Discount Rate ​ ​ ​ ​ ​ ​ Operating leases ​ 10.0 % ​ 10.0 % ​ Future minimum payments under the Company’s operating lease agreements are as follows: ​ ​ ​ ​ ​ For the Years Ending ​ ​ December 31, Minimum Lease Payments 2024 ​ $ 660,923 2025 ​ 675,400 2026 ​ ​ 560,996 2027 ​ ​ 214,619 Total future minimum lease payments ​ ​ 2,111,938 Less: Imputed interest ​ ​ ( 318,021 ) Present value of lease liabilities ​ ​ 1,793,917 Less: current portion ​ ​ ( 501,250 ) Lease liabilities, non-current portion ​ $ 1,292,667 ​ Litigations, Claims and Assessments In the normal course of business, the Company may be involved in legal proceedings, claims and assessments arising in the ordinary course of business. The Company records legal costs associated with loss contingencies as incurred and accrues for all probable and estimable settlements. ​ Note 10 – Related Party Transactions See Note 9 - Commitments and Contingencies for certain commitments and contingencies entered into with certain related parties. Senju License Agreement During 2015, the Company entered into an exclusive license agreement with Senju, or the Senju License Agreement, whereby the Company agreed to grant to Senju an exclusive, royalty-bearing license for its microdose product candidates for Asia to sublicense, develop, make, have made, manufacture, use, import, market, sell, and otherwise distribute the microdose product candidates. In consideration for the license, Senju agreed to pay to Eyenovia five percent ( 5 %) royalties on sales (net of certain manufacturing costs) for the term of the Senju License Agreement, subject to certain adjustments upon the loss of patent coverage for the term of the license agreement. The agreement will continue in full force and effect, on a country-by-country basis, until the latest to occur of: (i) the tenth (10th) anniversary of the first commercial sale of such a product candidate in a country; or (ii) the expiration of the licensed patents in a country. As of the date of this filing, there have been no commercial sales of such a product in Asia; therefore, no royalties have been earned. Senju is owned by the family of a former member of the Company’s Board of Directors. F-24 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ On April 8, 2020, Eyenovia entered into an amendment, (the “Senju License Amendment”), to the Senju License Agreement. Pursuant to the Senju License Amendment, the Company can license to any third party the right to research, develop, commercialize, manufacture or use certain products, or the Senju Licensed Products previously licensed to Senju in China (including the People’s Republic of China, Hong Kong, Macao, and Taiwan) and South Korea, or the Territory. Pursuant to the Senju License Amendment, the Company must pay Senju (a) a percentage in the range of 30 % to 40 % of revenue on (i) any lump-sum payments the Company receives from the third party, (ii) revenue (net of costs) obtained by the Company from contract research and/or development of the Senju Licensed Product in the Territory, and (iii) revenue (net of costs) obtained by the Company from contract manufacture for the device of the Senju Licensed Product in the Territory, the aggregate of which must be at least a $ 9 million minimum payment to Senju; and (b) a percentage in the range of 30 % to 40 % of any sales royalty revenue the Company receives from the third party. Since the Company executed a third-party license prior to the April 8, 2021 expiration of the Senju License, the Senju License Amendment will remain in effect for the duration of the license, subject to early termination. The Senju License Agreement was further amended in a Letter Agreement by and between the Company and Senju on August 10, 2020, or the Letter Agreement. Pursuant to the Letter Agreement, the Company will pay to Senju a percentage in the range of 30 % to 40 % of certain payments, royalties, or net proceeds received from Arctic Vision in connection with the Arctic Vision License Agreement. The Senju License Agreement was amended further by the License Amendment 2, effective September 14, 2021, (“Amendment 2”). The Amendment 2 excludes Greater China and South Korea from the territory in which Senju was granted an exclusive royalty-bearing license from the Company. In consideration for this exclusion, and upon and after the execution of Amendment 1 with Arctic Vision, the Company must make payments to Senju based on non-royalty license revenue and sales revenue, including the following: 1. a one-time upfront payment of $ 250,000 , paid on September 17, 2021, which represented an inducement to Senju to approve Amendment 1 of the Arctic Vision License Agreement related to the MicroStat product. 2. a percentage in the range from 30 % to 40 % of any upfront or milestone lump sum payments, or net revenues received by the Company in connection with any licensed product using piezo-print technology in a microdose dispenser containing: (a) the chemical substance atropine sulfate as its sole active ingredient and that is used for the treatment of myopia in humans; (b) the chemical substance pilocarpine as its sole active ingredient and that is used for the treatment of presbyopia in humans; or (c) the chemical substances phenylephrine and tropicamide in combination as active ingredients that are used for pharmaceutical mydriasis in humans (the “LA2 Licensed Product”) from certain third parties, and 3. a percentage in the range from thirty to forty percent of the amounts received by the Company in connection with sales of the LA2 Licensed Product in China and South Korea by certain third parties. See Note 2 – Summary of Significant Accounting Policies – Revenue Recognition - Arctic Vision License Agreement for additional details regarding the Arctic Vision License Agreement. Note 11 – Stockholders’ Equity Authorized Capital The Company is authorized to issue 90,000,000 shares of common stock, par value of $ 0.0001 per share, and 6,000,000 shares of preferred stock, par value of $ 0.0001 per share. The holders of the Company’s common stock are entitled to one vote per share. The Board of Directors is empowered, without stockholder approval, to issue preferred stock with dividend, liquidation, redemption, voting or other rights. Equity Incentive Plans On April 7, 2020, the Company’s Board of Directors approved the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan (the “Restated Plan”), which stockholders approved on June 30, 2020. Under the Restated Plan, as amended on June 16, 2022 and June 27, 2023, 6,700,000 shares of the Company’s common stock are reserved for issuance. The Restated Plan requires that all equity awards issued under the Restated Plan vest at least twelve months from the applicable grant date, subject to accelerated vesting, and provides that no dividend or dividend equivalent will be paid on any unvested equity award, although dividends with respect to unvested portions of equity may accrue and be paid when, and if, the awards later vest and the shares are actually issued to the grantee. In addition, the Restated Plan sets an annual limit on the grant date fair value of awards to any non-employee director, together with any cash fees F-25 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ paid during the year, of $ 150,000 , subject to certain exceptions for a non-executive chair of the Board. As of December 31, 2023, the number of securities remaining available for future issuance under equity compensation plans was 2,054,409 . At-The-Market Offering December 2021 Sales Agreement On December 14, 2021, the Company entered into a Sales Agreement, (the “December 2021 Sales Agreement”), with SVB Securities under which the Company may offer and sell, from time to time at its sole discretion, shares of common stock for gross proceeds of up to $ 50.0 million through SVB Securities as its sales agent, or the Offering. The issuance and sale of shares, if any, of common stock by the Company under the December 2021 Sales Agreement will be pursuant to the Company’s Registration Statement on Form S-3 (File No. 333-261638) filed with the SEC on December 14, 2021, or the Registration Statement, and the prospectus relating to the Offering filed therewith that forms a part of the Registration Statement. Subject to the terms and conditions of the December 2021 Sales Agreement, SVB Securities may sell the common stock by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) of the Securities Act of 1933, as amended. SVB Securities will use commercially reasonable efforts to sell the common stock from time to time, based upon instructions from the Company (including any price, time or size limits or other customary parameters or conditions the Company may impose). The Company will pay SVB Securities a commission equal to three percent ( 3.0 )% of the gross sales proceeds of any common stock sold through SVB Securities under the December 2021 Sales Agreement, and also has provided SVB Securities with certain indemnification rights. During the year ended December 31, 2022, the Company received approximately $ 5.4 million in gross proceeds and $ 5.3 million in net proceeds from the sale of 2,716,061 shares of its common stock under the December 2021 Sales Agreement. During the year ended December 31, 2023, the Company received approximately $ 4.7 million in gross proceeds and $ 4.6 million in net proceeds from the sale of 1,866,147 shares of its common stock. Securities Purchase Agreement On March 3, 2022, the Company entered into a securities purchase agreement, (the “Purchase Agreement”) with a certain institutional and accredited investor, or the Purchaser, pursuant to which the Company issued (i) 3,000,000 shares of common stock, (ii) pre-funded warrants, (the “Pre-Funded Warrants”), to purchase an aggregate of 1,870,130 shares of common stock and (iii) warrants to purchase an aggregate of 4,870,130 shares of common stock, (the “Investor Warrants”), (together, the “the March 2022 Offering”). The Company determined that the warrants qualified for equity classification. The offering price for the shares was $ 3.08 per share and the offering price for the Pre-Funded Warrants was $ 3.07 per Pre-Funded Warrant, which represents the per share public offering price less $ 0.01 per share exercise price for each Pre-Funded Warrant. The Investor Warrants will have an exercise price of $ 3.54 per share and each Investor Warrant became exercisable for one share of Common Stock. The Investor Warrants became exercisable six months from the date of issuance and the Pre-Funded Warrants were exercisable immediately upon issuance. The Pre-Funded Warrants shall terminate when fully exercised and the Investor Warrants will terminate five years from the initial exercisability date. The aggregate gross proceeds to the Company from the March 2022 Offering were approximately $ 15 million, excluding the proceeds, if any, from the exercise of the Pre-Funded Warrants and the Investor Warrants. No underwriter or placement agent participated in the March 2022 Offering. The Company incurred issuance costs in the amount of $ 83,391 in connection with the March 2022 offering. The March 2022 Offering was made pursuant to an effective registration statement on Form S-3 (Registration Statement No. 333-261638), as previously filed with and declared effective by the Securities and Exchange Commission and a related prospectus. 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 and warrants to purchase up to 4,838,709 shares of common stock (the “Common Warrants” and, together with the Pre-Funded F-26 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ 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 In connection with the August 2023 Offering (see “Registered Direct Offering” below), the Company entered into a warrant amendment agreement (the “Amendment”) with the Purchaser, 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 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. Warrants A summary of the warrant activity during the year ended December 31, 2023 is presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ Average ​ ​ ​ ​ Average ​ Remaining ​ ​ Number of ​ Exercise ​ Life ​ Warrants Price In Years Outstanding January 1, 2023 6,087,845 ​ $ 3.37 Granted 7,091,688 ​ 1.52 Repriced - (Old) ( 4,870,130 ) ​ 3.54 Repriced - (New) 4,870,130 ​ 2.23 Exercised ( 2,252,979 ) ​ ​ 0.01 ​ Outstanding December 31, 2023 ​ 10,926,554 ​ $ 2.28 ​ 4.8 ​ ​ ​ ​ ​ ​ ​ ​ Exercisable December 31, 2023 1,217,715 ​ $ 2.69 1.7 ​ F-27 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ The following table presents information related to warrants as of December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Warrants Outstanding ​ Warants Exercisable ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ ​ ​ ​ ​ Outstanding ​ Average ​ Exercisable ​ Shares x ​ Warrants x Exercise ​ Number of ​ Remaining Life ​ Number of ​ Remaining ​ Exercise Price Warrants In Years Warrants ​ Years Price $ 2.2300 (1) 9,708,839 — — ​ — ​ — $ 2.4696 909,451 1.2 909,451 ​ 1,093,209 ​ 2,245,980 $ 2.7240 216,380 1.2 216,380 ​ 260,100 ​ 589,419 $ 4.7600 91,884 7.3 91,884 ​ 670,376 ​ 437,368 ​ 10,926,554 1.7 1,217,715 ​ 2,023,685 ​ 3,272,767 (1) - These warrants become exercisable on or about February 24, 2024. ​ During the year ended December 31, 2023, warrants for the purchase of 2,252,979 shares of the Company’s common stock with an exercise price of $ 0.01 per share were exercised for aggregate proceeds of $ 22,529 . ​ During the year ended December 31, 2022, warrants for the purchase of 1,870,130 shares of the Company’s common stock with an exercise price $ 0.01 per share were exercised for aggregate proceeds of $ 18,701 . Stock-Based Compensation Expense The Company records stock-based compensation expense related to stock options and restricted stock units, or RSUs. For the years ended December 31, 2023 and 2022, the Company recorded stock-based compensation expense of $ 2,497,890 ($ 839,038 of which was included within research and development expenses and $ 1,658,852 was included within general and administrative expenses on the statements of operations) and $ 3,765,364 ($ 1,809,305 of which was included within research and development expenses and $ 1,956,062 was included within general and administrative expenses on the statements of operations), respectively. Restricted Stock Units A summary of the restricted stock units activity during the year ended December 31, 2023 is presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ Average ​ ​ Number of ​ Exercise ​ RSUs Price RSUs non-vested January 1, 2023 172,800 ​ $ 1.80 Granted 106,019 ​ 2.12 Vested ( 150,578 ) ​ 1.80 Forfeited ( 22,222 ) ​ 1.80 RSUs non-vested December 31, 2023 106,019 ​ $ 2.12 ​ ​ ​ ​ ​ ​ Vested RSUs undelivered December 31, 2023 135,745 ​ $ 2.22 ​ To date, the RSUs have only been granted to directors in accordance with the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan. The Company’s policy is not to deliver shares underlying the RSUs until the termination of service. Between February 14, 2022 and August 18, 2022, the Company granted members of its Board of Directors an aggregate of 193,304 RSUs under the Restated Plan. Each RSU is subject to settlement into one share of the Company’s common stock. The RSUs vest on the earlier of (i) the one-year anniversary of the date of grant and (ii) the date of the 2023 annual stockholders meeting, subject to the grantee remaining on the Board until then. The RSUs had a grant date fair value of $ 373,000 , which will be recognized over the vesting period. In 2022, there was 108,366 of common shares issued related to vested RSUs. F-28 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ Between June 27, 2023 and November 14, 2023, the Company granted members of its Board of Directors an aggregate of 106,019 RSUs under the Restated Plan. Each RSU is subject to settlement into one share of the Company’s common stock. The RSUs vest on the earlier of (i) the one-year anniversary of the date of grant and (ii) the date of the 2024 annual stockholders meeting, subject to the grantee remaining on the Board until then. The RSUs had a grant date fair value of $ 224,800 , which will be recognized over the vesting period. In 2023, there was 47,733 of common shares issued related to vested RSUs. As of December 31, 2023, there was $ 119,141 of unrecognized stock-based compensation expense related to RSUs which will be recognized over a weighted average period of 0.6 years. Stock Options A summary of the option activity during the year ended December 31, 2023 is presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ ​ ​ Weighted ​ Average ​ ​ ​ ​ ​ ​ ​ Average ​ Remaining ​ Aggregate ​ ​ Number of ​ Exercise ​ Life ​ Intrinsic ​ Options Price In Years Value Outstanding, January 1, 2023 5,380,553 ​ $ 3.55 ​ Granted 848,989 ​ 2.24 ​ Exercised ( 88,999 ) ​ 1.83 ​ Forfeited ( 834,166 ) ​ 3.92 ​ Outstanding, December 31, 2023 5,306,377 ​ $ 3.31 6.7 ​ $ 541,252 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Exercisable, December 31, 2023 3,980,102 ​ $ 3.63 6.0 ​ $ 341,137 ​ The 2023 option exercises resulted in common stock issuances of (a) 10,000 shares; and (b) 20,749 shares after withholding 58,250 shares pursuant to a cashless exercise. ​ The following table presents information related to stock options as of December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Outstanding ​ Average ​ Exercisable Exercise ​ Number of ​ Remaining Life ​ Number of Price Options In Years Options $ 1.00 - $ 1.99 ​ 1,578,982 ​ 5.2 ​ 1,115,074 $ 2.00 - $ 2.99 ​ 1,450,663 ​ 6.4 ​ 831,695 $ 3.00 - $ 3.99 ​ 898,528 ​ 6.5 ​ 750,743 $ 4.00 - $ 4.99 ​ 333,000 ​ 7.6 ​ 252,123 $ 5.00 - $ 5.99 ​ 50,805 ​ 3.8 ​ 50,638 $ 6.00 - $ 6.99 ​ 843,759 ​ 6.1 ​ 829,189 $ 7.00 + ​ 150,640 ​ 4.3 ​ 150,640 ​ ​ 5,306,377 ​ 6.0 ​ 3,980,102 ​ F-29 Table of Contents EYENOVIA, INC. NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 ​ In applying the Black-Scholes option pricing model to stock options granted, the Company used the following approximate assumptions: ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended ​ ​ December 31, ​ 2023 2022 Expected term (years) 5.50 - 10.00 0.58 - 10.00 ​ Risk free interest rate 3.44 % - 4.72 % ​ 0.76 % - 3.80 % ​ Expected volatility 80 % - 95 % ​ 82 % - 90 % ​ Expected dividends 0.00 % ​ 0.00 % ​ ​ The Company has computed the fair value of stock options granted using the Black-Scholes option pricing model. Option forfeitures are accounted for at the time of occurrence. The expected term used for options issued is the estimated period of time that options granted are expected to be outstanding. The Company utilizes the “simplified” method to develop an estimate of the expected term of “plain vanilla” option grants. The Company uses its historical volatility for the period from its initial public offering through the valuation date in computing the expected volatility. Accordingly, the Company is utilizing an expected volatility figure based on a review of its historical volatility over a period of time equivalent to the expected life of the instrument being valued. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued. 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 years ended December 31, 2023 and 2022 was approximately $ 1.65 and $ 1.60 per share, respectively. As of December 31, 2023, there was $ 1,812,323 of unrecognized stock-based compensation expense related to stock options which will be recognized over a weighted average period of 1.5 years. ​ Note 12 – Employee Benefit Plans 401(k) Plan In April 2019, the Company adopted the Eyenovia 401(k) Plan, or the Plan, which went into effect in May 2019. All Company employees are able to participate in the Plan, subject to eligibility requirements as outlined in the Plan documents. Under the terms of the Plan, eligible employees are able to defer a percentage of their pay every pay period up to annual limitations set by Congress and the Internal Revenue Service under Section 401(k) of the Internal Revenue Code. 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. For the years ended December 31, 2023 and 2022, the Company recorded expense of $ 218,170 and $ 208,006 associated with its matching contributions, respectively. ​ Note 13 – Subsequent Events Bausch + Lomb/ Eyenovia Reversion of Licensed Rights Under Mutual Termination Agreement On January 12, 2024, the Company and Bausch + Lomb entered into a Letter Agreement (the “Letter Agreement”), pursuant to which Eyenovia will reacquire the rights to the Bausch Licensed Product. See Note 2 – Summary of Significant Accounting Policies – Revenue Recognition – Bausch + Lomb License Agreement for details of the Letter Agreement. As presented in Note 9 – Commitments and Contingencies – Clinical Supply Returns, the Company had recorded a charge equal to $ 400,000 for the cost to replace or to rework the clinical supply product. The Letter Agreement will result in a reversal of the clinical supply return reserve, because Bausch + Lomb will no longer be returning the defective product. ​ F-30