What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2025-04-15 compared with 2024-03-18 · 520 added, 392 removed, 787 unchanged (54% of the section changed)

4 unchanged sentences

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.

Based on his evaluation, our principal executive officer and principal financial and accounting officer concluded that, as of December 31, 2024, 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, 2024.

Management’s Report on Internal Control over Financial Reporting

4 unchanged sentences

(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;

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, 2024, 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.

Based on this evaluation under the 2013 Framework, our principal executive officer and principal financial and accounting officer has concluded that our internal control over financial reporting was ineffective as of December 31, 2024.

Specifically, management’s conclusion was based on the following material weaknesses which existed as of December 31, 2024:

● We failed to properly design and implement effective controls over the accounting for certain significant and complex, non-routine transactions and events.

Specifically, the Company failed to properly account for the fair value of common equity shares issued in relation to the consideration for licensing agreements and debt modification.

● We failed to properly design and implement effective controls over identifying and recording impairments of Right-of-Use (ROU) assets.

Specifically, we determined that the controls designed to review and approve the impairment analysis for ROU assets were not adequately designed or operating effectively.

This deficiency resulted from a lack of sufficient precision in our control activities to properly account for the impairment of ROU assets and to appropriately measure the impairment loss.

A material weakness is a control deficiency or combination of control deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

Notwithstanding the existence of the material weaknesses as described above, we believe that the financial statements in this Annual Report fairly present, in all material respects, our financial position, results of operations and cash flows as of the dates, and for the periods presented, in conformity with GAAP.

Remediation Plan

Our management is committed to taking further action and implementing necessary enhancements or improvements, including those necessary to address the material weaknesses cited above.

However, the material weaknesses will not be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

Changes in Internal Control over Financial Reporting

6 unchanged sentences

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.

Information required by this Item concerning our directors is incorporated by reference from the sections captioned “Election of Directors” and “Corporate Governance Matters” contained either in our proxy statement related to the 2025 Annual Meeting of Stockholders (the “2025 Proxy Statement”) or an amendment to this Form 10-K, 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 2025 Proxy Statement or an amendment to this Form 10-K.

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.”

The information required by this Item concerning our executive officers is incorporated by reference from the section captioned “Executive Officers” contained in our 2025 Proxy Statement or an amendment to this Form 10-K.

The information required by this Item concerning compliance with Section 16(a) of the Exchange Act is incorporated by reference from the section captioned “Delinquent Section 16(a) Reports” contained in our 2025 Proxy Statement or an amendment to this Form 10-K.

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.

The information required by this Item is incorporated by reference to the information under the sections captioned “Executive Compensation,” and “Director Compensation” contained in our 2025 Proxy Statement or an amendment to this Form 10-K.

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

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(excluding securities

Plan Category

warrants, and rights

reflected in column (a))

Plan Category

Equity compensation plans approved by security holders

2 unchanged sentences

Equity compensation plans not approved by security holders

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.

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.

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.

The information required by this Item is incorporated by reference to the information under the section captioned “Audit Committee Report” contained in our 2025 Proxy Statement or an amendment to this Form 10-K.

Exhibits, Financial Statement Schedules.

12 unchanged sentences

June 14, 2018

Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation

June 14, 2024

Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation

January 31, 2025

Second Amended and Restated Bylaws

1 unchanged sentence

Description of Securities

March 31, 2023

Form of Class A Warrant Issued on March 24, 2020

March 25, 2020

Filed herewith

Form of Class B Warrant Issued on March 24, 2020

March 25, 2020

Warrant Amendment Agreement, dated June 28, 2024

Form of Warrant Issued on May 7, 2021

Form of Pre-Funded Warrant Issued on March 7, 2022

March 9, 2022

Form of Warrant Issued on March 7, 2022

March 9, 2022

Form of Warrant Issued on August 29, 2023

August 29, 2023

Form of Warrant issued on August 29, 2023

August 29, 2023

Form of Warrant Issued on July 1, 2024

Form of Warrant Issued on September 30, 2024

September 30, 2024

Amendment No.

1 to Warrant Issued on September 30, 2024, dated December 9, 202 4

Filed herewith

Form of Warrant Issued on November 26, 2024

November 26, 2024

Amendment No.

1 to Warrant Issued on November 26, 2024, dated December 9, 2024

Filed herewith

Form of Warrant Issued on December 9, 2024

December 9, 2024

Form of Series A Warrant Issued on January 17, 2025

January 16, 2025

Form of Series B Warrant Issued on January 17, 2025

January 16, 2025

Exclusive License Agreement, dated March 18, 2015, between Eyenovia, Inc.

7 unchanged sentences

August 14, 2020

Master Consulting Services Agreement, dated November 4, 2014, between Eyenovia, Inc.

and Private Medical Equity, Inc.

December 19, 2017

Executive Employment Agreement, dated February 15, 2019, by and between the Company and Tsontcho Ianchulev

February 19, 2019

Executive Employment Agreement, dated February 15, 2019, by and between the Company and John Gandolfo

February 19, 2019

Executive Employment Agreement, dated February 15, 2019, by and between the Company and John Gandolfo

February 19, 2019

Form of Nondisclosure, Assignment of Inventions and Noncompetition Agreement

February 19, 2019

Eyenovia, Inc.

2014 Equity Incentive Plan, as amended

August 14, 2019

Form of Nonqualified Stock Option Agreement

August 14, 2019

Registration Rights Agreement, dated March 23, 2020, between Eyenovia, Inc.

and the investors named therein

March 25, 2020

Promissory Note and Agreement dated May 3, 2020

Eyenovia, Inc.

Amended and Restated 2018 Omnibus Stock Incentive Plan

June 17, 2022

Form of Notice of Stock Option Grant and Award Agreement

June 14, 2018

Form of Restricted Stock Award Agreement

June 14, 2018

Amendment No.

2 to the Exclusive License Agreement by and between Eyenovia, Inc.

and Senju Pharmaceutical Co., Ltd., dated September 14, 2021

November 12, 2021

License Agreement by and between Eyenovia, Inc.

1 unchanged sentence

August 14, 2020

License Agreement by and between Eyenovia, Inc.

and Bausch Health Ireland Limited, dated October 9, 2020

October 13, 2020

First Amendment to Executive Employment Agreement, dated February 1, 2021, by and between the Company and Michael M.

February 3, 2021

Loan and Security Agreement, by and between Eyenovia, Inc.

and Silicon Valley Bank, dated May 7, 2021

First Amendment to Loan and Security Agreement, by and between Eyenovia, Inc.

and Silicon Valley Bank, dated September 29, 2021

Amendment No.

1 to License Agreement by and between Eyenovia, Inc.

and Arctic Vision (Hong Kong) Limited, dated September 14, 2021

November 12, 2021

Waiver Agreement, by and between Eyenovia, Inc.

and Silicon Valley Bank, dated November 30, 2021

December 3, 2021

Sales Agreement, by and between Eyenovia, Inc.

and SVB Leerink LLC, dated December 14, 2021

December 14, 2021

Securities Purchase Agreement by and between Eyenovia, Inc.

and Armistice Capital Master Fund Ltd., dated March 3, 2022

March 7, 2022

Addendum to Executive Employment Agreement, dated March 10, 2022, by and between the Company and Tsontcho Ianchulev

March 30, 2022

Addendum to Executive Employment Agreement, dated March 10, 2022, by and between the Company and John Gandolfo

March 30, 2022

Addendum to Executive Employment Agreement, dated March 10, 2022, by and between the Company and Michael Rowe

Mutual Termination and Reassignment, dated January 12, 2024, by and between Eyenovia, Inc and Bausch + Lomb Ireland Limited

March 18, 2024

Third Amendment to Loan and Security Agreement, dated as of May 6, 2022, by and between Eyenovia, Inc.

and Silicon Valley Bank.

Employment Agreement, dated July 26, 2022, by and between Eyenovia, Inc, and Michael Rowe

August 11, 2022

Executive Chair Agreement, dated August 1, 2022, by and between, Eyenovia, Inc.

and Tsontcho Ianchulev

August 11, 2022

Non-Employee Director Compensation Policy, as amended

License Agreement, dated August 15, 2023, by and between Eyenovia, Inc.

and Formosa Pharmaceuticals, Inc.

November 13, 2023

8 unchanged sentences

March 31, 2023

Employment Agreement, dated July 26, 2022, by and between Eyenovia, Inc, and Michael Rowe

August 11, 2022

Employment Agreement, dated December 19, 2022, by and between Eyenovia, Inc.

1 unchanged sentence

March 31, 2023

Form of Restricted Stock Unit Agreement

Non-Employee Director Compensation Policy, as amended

November 14, 2022

Eyenovia, Inc.

2014 Equity Incentive Plan, as amended

August 14, 2019

Form of Nonqualified Stock Option Agreement

August 14, 2019

Eyenovia, Inc.

Amended and Restated 2018 Omnibus Stock Incentive Plan, as Amended

June 27, 2023

License Agreement, dated August 15, 2023, by and between Eyenovia, Inc.

and Formosa Pharmaceuticals, Inc.

Form of Restricted Stock Unit Agreement

Form of Notice of Inducement Stock Option Grant

November 12, 2024

Securities Purchase Agreement, dated August 24, 2023

August 29, 2023

Warrant Amendment Agreement, dated August 24, 2023

August 29, 2023

Mutual Termination and Reassignment, dated January 12, 2024, by and between Eyenovia, Inc and Bausch + Lomb Ireland Limited

Form of Indemnification and Advancement Agreement

November 12, 2024

Amended and Restated Sales Agreement, dated December 30, 2024, by and between Eyenovia, Inc.

and Chardan Capital Markets, LLC

December 30, 2024

Inducement Letter, dated January 16, 2025

January 16, 2025

Insider Trading Policy

Filed herewith

1 unchanged sentence

Filed herewith

Certification of the Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Filed herewith

Certification of the Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of the Principal Executive Officer and Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Filed herewith

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Policy Relating to Recovery of Erroneously Awarded Compensation

Filed herewith

March 18, 2024

Inline interactive data files pursuant to Rule 405 of Regulation S-T:

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EYENOVIA, INC.

March 18, 2024

April 15, 2025

/s/ Michael Rowe

4 unchanged sentences

Chief Executive Officer

March 18, 2024

(Principal Executive Officer) and Director

/s/ John Gandolfo

Chief Financial Officer

March 18, 2024

John Gandolfo

(Principal Financial and Accounting Officer)

April 15, 2025

(Principal Executive and Financial and Accounting Officer) and Director

/s/ Tsontcho Ianchulev

March 18, 2024

April 15, 2025

Tsontcho Ianchulev

/s/ Rachel Jacobson

March 18, 2024

April 15, 2025

Rachel Jacobson

/s/ Charles E.

March 18, 2024

April 15, 2025

/s/ Ram Palanki

March 18, 2024

April 15, 2025

/s/ Ellen Strahlman

March 18, 2024

April 15, 2025

Ellen Strahlman

/s/ Michael Geltzeiler

March 18, 2024

April 15, 2025

Michael Geltzeiler

5 unchanged sentences

Statements of Operations for the Years Ended December 31, 2024 and 2023

Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2023 and 2022

Statements of Changes in Stockholders’ (Deficiency) Equity for the Years Ended December 31, 2024 and 2023

Statements of Cash Flows for the Years Ended December 31, 2024 and 2023

1 unchanged sentence

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of Eyenovia, Inc.

To the Stockholders 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”).

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

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

1 unchanged sentence

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.

As more fully described in Note 2, the Company has a significant working capital deficiency, 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.

3 unchanged sentences

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.

Our responsibility is to express an opinion on the Company’s financial statements based on our audit s .

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.

15 unchanged sentences

We have served as the Company’s auditor since 2017.

March 18, 2024

April 15, 2025

EYENOVIA, INC.

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

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

none issued and outstanding as of December 31, 2024 and 2023

Common stock, $ 0.0001 par value, 300,000,000 shares authorized;

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Total Stockholders’ Equity

( 13,095,952 )

Total Liabilities and Stockholders’ Equity

5 unchanged sentences

Cost of revenue

( 3,927,228 )

( 3,869,892 )

Operating Expenses:

Research and development

General and administrative

Selling, general and administrative

Reacquisition of license rights

Asset impairments

Total Operating Expenses

3 unchanged sentences

Other (Expense) Income:

Other (expense) income , net

Other expense

Change in fair value of equity consideration payable

Interest expense

11 unchanged sentences

EYENOVIA, INC.

Statements of Changes in Stockholders’ Equity

Statements of Changes in Stockholders’ (Deficiency) Equity

For the Years Ended December 31, 2024 and 2023

Stockholders’

(Deficiency) Equity

Balance - January 1, 2023

( 118,230,463 )

Issuance of common stock and warrants in direct offering [1]

Issuance of common stock in debt financing [2]

Origination costs related to equity in debt financing

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

Exercise of pre-funded stock warrants

Stock-based compensation

Issuance of common stock related to vested restricted stock units

( 28,011,157 )

Balance - December 31, 2022

( 118,230,463 )

Issuance of common stock and warrants in registered direct offering [1][5]

1 unchanged sentence

Exercise of pre-funded stock warrants

Issuance of common stock in At the Market offering [6]

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

Cashless exercise of stock options

10 unchanged sentences

( 145,491,559 )

[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 .

Issuance of common stock in At the Market Program [6]

Issuance of common stock as consideration for licensing agreement [7]

Issuance of common stock as consideration for reacquisition of licensing agreement [8]

Issuance of common stock and warrants in offerings [9]

Exercise of pre-funded stock warrants

Warrant modification and additional warrants - incremental value [10]

Warrant modification and additional warrants - in issuance costs for offering [11]

( 2,868,000 )

Issuance of common stock as consideration for modification of loan agreement

Stock-based compensation

( 49,818,433 )

Balance - December 31, 2024

( 195,309,992 )

( 13,095,952 )

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

3 unchanged sentences

[5] 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.

[6] Includes gross proceeds of $ 6,234,402 less total issuance costs of $ 187,033 .

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

[8] Shares issued as partial consideration for reversion of License Agreement with Bausch & Lomb Ireland Limited.

[9] Includes gross proceeds of $ 19,385,015 , less total cash issuance costs of $ 2,373,693 .

[10] Offering includes modification of warrants and additional warrants in the July 2024 offering.

[11] Non-cash warrant modification and additional warrants issuance costs related to one of the offerings are shown on a separate line item for clarity.

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

8 unchanged sentences

Stock-based compensation

Change in fair value of equity consideration payable

( 1,240,800 )

Depreciation of property and equipment

Amortization of debt discount

Write-off of property and equipment

Asset impairments

Write-down of inventories to net realizable value

Provision for clinical supplies to be returned

Provision for returned clinical supplies

Reacquisition of license rights

Non-cash rent expense

1 unchanged sentence

Prepaid expenses and other current assets

License fee and expense reimbursements receivables

License fee and expense reimbursement receivables

Deferred clinical supply costs

( 2,271,862 )

( 2,284,931 )

Security and equipment deposits

1 unchanged sentence

Accrued compensation

( 1,514,452 )

Accrued expenses and other current liabilities

6 unchanged sentences

( 2,847,592 )

Vendor deposits for property and equipment

Investment in intangible asset

3 unchanged sentences

Cash Flows From Financing Activities

Proceeds from sale of common stock and warrants in direct offering [1][2]

Payment of offering issuance costs

Proceeds from sale of common stock and warrants in offerings [1] [2]

Payment of offerings issuance costs

( 2,373,693 )

Proceeds from sale of common stock in At the Market offering

Payment of issuance costs for At the Market offering

( 1,091,354 )

Proceeds from sale of common stock in At the Market Program

Payment of issuance costs for At the Market Program

Proceeds from exercise of stock options

1 unchanged sentence

Proceeds from note payable and equity issued to Avenue

Payment of issuance costs for equity issued to Avenue

Payment of issuance costs for notes issued to Avenue

5 unchanged sentences

( 8,014,463 )

Cash and Cash Equivalents - Beginning of Year

Cash and Cash Equivalents - End of Year

Cash and Cash Equivalents - Beginning of Period

Cash and Cash Equivalents - End of Period

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

3 unchanged sentences

Supplemental Disclosure of Cash Flow Information:

Cash paid during the year for:

Cash paid during the period for:

Supplemental Disclosure of Non-Cash Investing and Financing Activities

Purchase of insurance policy financed by note payable

Recognition of right-of-use asset for lease liability upon adoption of ASU 2016-02

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

Accrual for intangible asset milestone obligation

Reclassification of deferred clinical supply costs to inventories

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

1 unchanged sentence

Original issue discount on notes payable

Warrant modification - incremental value

Warrant modification and additional warrants - incremental value

Issuance of common stock as consideration for licensing agreement

Cashless exercise of stock options

Common shares issued recorded as debt discount for Avenue Loan

Common stock issued as consideration for licensing agreement

Common stock issued as consideration for reacquisition of licensing agreement

Common stock issued in consideration for equipment received in conjunction with licensing agreement

Common stock issued as consideration for modification of loan agreement

Interest expense added to note principal

Issuance of common stock related to vested restricted stock units

5 unchanged sentences

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

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

Note 1 – Business Organization, Nature of Operations and Basis of Presentation

Organization and Operations

Eyenovia, Inc., (“Eyenovia” or the “Company”) is an ophthalmic technology company developing a proprietary Optejet® topical ophthalmic medication dispensing platform.

In November 2024, the Company received a negative clinical trial result in their development-stage drug-device combination product, MicroPine.

As a result, the Company restructured, minimized expenses and engaged with an investment bank to explore strategic options in order to maximize shareholder value.

The Company has paused the national sales roll-out of its products clobetasol propionate and Mydcombi® until additional funding can be obtained.

At the same time, the Company accelerated development efforts relating to the Optejet.

Basis of Presentation

On January 31, 2025, the Company effected a reverse stock split of its common stock at a ratio of 1–for-80 (the “Reverse Split”).

Accordingly, all share and per share amounts for all periods presented in these financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the Reverse Split and adjustment of the conversion price or exercise price of each outstanding equity award, convertible security and warrant as if the transaction had occurred as of the beginning of the earliest period presented (see Note 15 – Subsequent Events - Reverse Stock Split)

Note 2 – Summary of Significant Accounting Policies And Going Concern

Going Concern

As of December 31, 2024, the Company had unrestricted cash and cash equivalents of approximately $ 2.1 million and an accumulated deficit of approximately $ 195.3 million.

2 unchanged sentences

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.

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, the Company’s ability to raise further capital, through the sale of additional equity or debt securities or the completion of a transaction consistent with the strategic alternatives that we are exploring 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.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

The Company’s future capital requirements and adequacy of its available funds will depend on many factors, including the Company’s ability to execute a strategic partnership or merger, 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, take additional measures to reduce costs in order to conserve its cash or file for bankruptcy.

Use of Estimates

5 unchanged sentences

It is reasonably possible that actual results could differ from those estimates.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

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.

5 unchanged sentences

As of December 31, 2024 and 2023, the Company had cash and cash equivalent balances in excess of FDIC insurance limits of $ 1,658,188 and $ 14,243,870 , 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 .

Property and equipment are stated at cost, net of accumulated depreciation, amortization and impairments, 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;

7 unchanged sentences

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.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

The Company recorded $ 11,207,897 in impairment losses during the year ended December 31, 2024 , of which $ 9,797,198 was for the Company’s long-lived assets consisting of $ 6,122,945 of intangible assets, $ 3,254,254 of property and equipment, which includes $ 711,441 of equipment deposits, and $ 420,000 of operating lease right-of-use assets.

The Company did not record any impairment losses during the year ended December 31, 2023.

Fair Value of Financial Instruments

7 unchanged sentences

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.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

The Company is subject to Federal, New York State and City, and State of California income taxes and files tax returns in those jurisdictions.

2 unchanged sentences

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.

The Company’s policy is to classify assessments, if any, for tax-related interest as interest expense and penalties as selling, 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 Company’s revenues are generated primarily through product sales or 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.

6 unchanged sentences

The Company’s policy is to recognize amounts allocated to joint operating activities as a reduction in research and development expense.

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.

5 unchanged sentences

Recognize revenue when the company satisfies a performance obligation.

The Company recognizes revenue primarily from the following type of contract:

During the years ended December 31, 2024 and 2023, the Company recognized 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.

2 unchanged sentences

Sales-based royalty payments derived from usage of intellectual property are recognized when those sales occur.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Arrangements that include rights to additional goods or services that are exercisable at a customer’s discretion are generally considered discretionary purchase options.

10 unchanged sentences

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.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

It is currently unknown when the remaining milestones related to the performance obligations will be achieved.

Royalty Payments

4 unchanged sentences

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.

On October 9, 2020, the Company entered into a license agreement (the Bausch License Agreement”), pursuant to which Bausch + Lomb was permitted to develop and commercialize the Bausch Licensed Product (as defined in the Bausch License Agreement) in the United States and Canada (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.

On January 12, 2024, the Company and Bausch + Lomb entered into a mutual termination and reassignment agreement (the “Letter Agreement”), pursuant to which Eyenovia reacquired the rights to the Bausch Licensed Product.

The terms of the agreement include the immediate transfer of the rights and the subsequent transfer of 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 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.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Pursuant to the Letter Agreement, the Company paid Bausch + Lomb an upfront payment of $ 2.0 million in cash on January 22, 2024.

The Company recorded this amount as an operating expense.

In connection with the entry into the Letter Agreement, the Company also agreed to issue Bausch + Lomb $ 3.0 million in shares of the Company’s common stock, following the Regulatory Transfer Date (the “Transfer Date”).

On April 11, 2024, the Transfer Date, the transfer of the rights and certain assets relating to the CHAPERONE trial from Bausch + Lomb to the Company, was completed.

On May 3, 2024, the Company issued Bausch + Lomb 28,742 shares of the Company’s common stock (calculated pursuant to the Letter Agreement at $ 3.0 million using a thirty-day volume-weighted average price on April 11, 2024, but valued at $ 2.3 million on the May 3, 2024 settlement date, resulting in a $ 0.7 million change in fair value of the equity consideration payable), in satisfaction of its obligations pursuant to the Letter Agreement.

Pursuant to the Side Letter (see Note 10 – Commitments and Contingencies - Defective Clinical Supply), the Company agreed to pay approximately $ 0.5 million to Bausch + Lomb related to the defective clinical supply.

It was also agreed that the Company will receive approximately $ 0.25 million from Bausch + Lomb to fund the vendor hold back liability that will be due upon completion of the CHAPERONE study.

In addition, the Company purchased $ 0.5 million of clinical supplies from Bausch + Lomb in April 2024.

Clinical Supply Arrangements

6 unchanged sentences

Deferred clinical supply costs were $ 0.0 million and $ 4.3 million at December 31, 2024 and 2023, 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.

Net income from the sale of clinical supplies was included in other income and amounted to $ 0.0 million and $ 0.2 million for the years ended December 31, 2024 and 2023, 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.

See Note 10 – Commitments and Contingencies – Defective Clinical Supply.

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

2 unchanged sentences

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

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:

3 unchanged sentences

Total inventory

During the year ended December 31, 2024, the Company recorded a charge of approximately $ 3.1 million of inventories to cost of revenue in order to write down inventories to their net realizable value.

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.

Intangible assets are stated at fair value as of the date acquired, less accumulated amortization.

Amortization is calculated based on the estimated useful lives of the assets, using the straight-line method or another method that more fairly represents the utilization of the assets.

The Company periodically evaluates the remaining useful lives of our intangible assets to determine whether events or circumstances warrant a revision to the remaining periods of amortization.

In the event that the estimate of an intangible asset’s remaining useful life

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

has changed, the remaining carrying amount of the intangible asset is amortized prospectively over that revised remaining useful life.

If it is determined that an intangible asset has an indefinite useful life, that intangible asset would be subject to impairment testing annually or whenever events or circumstances indicate that its carrying value may not, based on future undiscounted cash flows or market factors, be recoverable.

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.

8 unchanged sentences

The Company records prepaid expenses on its balance sheet for the payment of research and development expenses in advance of services being provided.

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.

9 unchanged sentences

See Note 12 – Stockholders’ Equity – Stock Options for additional information related to estimating the fair value of stock options.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Net Loss Per Share of Common Stock

3 unchanged sentences

For the Years Ended

Net income (loss)

( 27,261,096 )

( 28,011,157 )

Net loss attributable to common stockholders

11 unchanged sentences

Total potentially dilutive shares

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

Subsequent Events

8 unchanged sentences

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.

In November 2024, The FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220 – 04).

This update requires an entity to disclose more detailed information regarding expenses for the entity.

The amendments require that at each interim and the annual reporting period, the entity must disclose amounts related to purchases of inventory, employee compensation, depreciation, intangible asset amortization and depreciation, depletion, and amortization recognized as part of oil and gas- producing activities.

Including the amounts, the entity is required to disclose and qualitative description of the amounts remaining in relevant expense captions, and to disclose the total amount of selling expenses and the definition of selling

EYENOVIA, INC.

1 unchanged sentence

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

The amendments in this update should be applied prospectively to financial statements issued for reporting periods, and retrospectively to any prior periods presented in the financials.

Although early adoption is permitted, the new guidance becomes effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.

Since this new ASU addresses only disclosures, the Company does not expect the adoption of this ASU to have any material effects on its financial condition, results of operations or cash flows.

Recently Adopted Accounting Standards

In November 2023, the FASB issued ASU 2023-07 “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.” These amendments require a public entity to disclose significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually.

Public entities with a single reporting segment are required to provide both the new disclosures and all of the existing disclosures required under ASC 280.

The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company adopted this ASU for the year ended December 31, 2024.

Since this new ASU addresses only disclosures, the adoption of this ASU did not have a material effect on the Company’s financial condition, results of operations or cash flows.

Note 3 – Prepaid Expenses and Other Current Assets

1 unchanged sentence

Payroll tax receivable

Prepaid research and development expenses

Prepaid insurance expenses

Prepaid conference expenses

Prepaid general and administrative expenses

Prepaid patent expenses

Prepaid research and development expenses

Prepaid rent and security deposit

Prepaid conference expenses

Total prepaid expenses and other current assets

As of December 31, 2024, the Company wrote off $ 710,820 of prepaid regulatory expenses, due to the uncertainty associated with the Company’s clobetasol propionate and Mydcombi products and its exploration of strategic alternatives.

Note 4 - Property and Equipment, Net

1 unchanged sentence

Leasehold improvements

accumulated depreciation and amortization

( 3,254,254 )

accumulated depreciation

( 2,547,494 )

( 1,419,046 )

Property and equipment, net

Equipment not yet placed in service

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.

Depreciation expense was $ 1,128,449 and $ 783,208 for the years ended December 31, 2024 and 2023, respectively, of which $ 1,112,464 and $ 776,479 , respectively, was included within research and development expenses and $ 15,985 and $ 6,729 , respectively, was included in selling, general and administrative expenses in the accompanying statements of operations.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

As of December 31, 2023, the Company had $ 711,441 of outstanding deposits for equipment purchases, which are presented as non-current assets on the balance sheet.

As of December 31, 2024, the Company impaired the $ 711,441 outstanding deposits due to the uncertainty associated with idling its manufacturing operations for Mydcombi.

Additionally, the Company impaired $ 3,254,254 of its remaining fixed assets due to the uncertainty associated with its operations and its exploration of strategic alternatives.

Note 5 – Intangible Assets

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

(“Formosa”), 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 % (the “Formosa Licensed Product”), 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 Formosa Licensed Product.

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

The Company paid Formosa the aggregate amount of $ 2.0 million (the “Upfront Payment”), consisting of (a) cash in the amount of $ 1.0 million and (b) 6,097 shares of common stock, which is included in Intangible Assets on the accompanying balance sheet.

The Company also capitalized $ 122,945 of transaction costs, which were primarily legal expenses.

In addition to the Upfront Payment, the Company must pay Formosa up to $ 4.0 million upon the achievement of certain development milestones and up to $ 80.0 million upon the achievement of certain sales milestones.

The trigger for the initial $ 2.0 million development milestone payments was FDA approval of the Formosa Licensed Product and the effective date of the acceptance by the Company of the transfer and assignment of the FDA approval.

This occurred on March 14, 2024.

Under the provisions of the Formosa License, the Company had 45 days from the effective date of acceptance of the transfer and assignment of FDA approval to make the payment half in cash and half in common stock, otherwise the payment due would revert to be fully in cash.

The Company paid Formosa the aggregate amount of $ 2.0 million, consisting of (a) cash in the amount of $ 1.0 million on April 26, 2024 and (b) 7,668 shares of common stock on April 29, 2024 (calculated pursuant to the Formosa License using a five-day volume-weighted average price on March 14, 2024, but valued at $ 0.4 million on the April 29, 2024 settlement date, resulting in a $ 0.6 million change in fair value of the equity consideration payable), which was included in our impairment of Intangible Assets at December 31, 2024.

The second $ 2.0 million development milestone (to be fully paid in cash) was earned upon FDA approval of the Formosa Licensed Product and payment was triggered on the earlier of twelve months after FDA approval or six months following the first commercial sale of the Formosa Licensed Product.

As of the Form 10-K filing date, this payment remains unpaid and under negotiation.

Because the payment became probable and estimable, the Company recorded an additional $ 2.0 million increase in the intangible asset which was included in accrued expenses at December 31, 2024.

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

The Upfront Payment has been capitalized as an intangible asset by the Company.

In October 2024, the Company had its first commercial sale of the Licensed Product, however, due to the uncertainty associated with its clobetasol propionate product, the Company impaired the full $ 6,122,945 carrying value of the Formosa License at December 31, 2024.

Note 6 – Accrued Compensation

8 unchanged sentences

As of December 31, 2024 and 2023, accrued expenses and other current liabilities consisted of the following:

Accrued intangible milestone obligation

Accrued licensee reimbursement

Accrued rework of clinical supply returns

Accrued research and development expenses

Accrued fixed asset disposal costs

Accrued professional services

Accrued clinical studies costs

Credit card payable

Accrued leasehold improvements

Accrued research and development expenses

Total accrued expenses and other current liabilities

15 unchanged sentences

Total non-current portion

( 1,626,458 )

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 .

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 “2023 D&O Loan”).

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

The 2023 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.

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.

On February 24, 2024, the Company issued a note payable in the amount of $ 505,050 for the purchase of a directors and officers’ liability insurance policy (the “2024 D&O Loan”).

The note accrued interest at a rate of 8.15 % per year and matured on October 24, 2024 .

The 2024 D&O Loan was payable in eight monthly payments of $ 65,076 consisting of principal and interest.

The note payable was repaid in full during the year ended December 31, 2024.

Interest expense was $ 15,558 for the year ended December 31, 2024.

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

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

2 unchanged sentences

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.

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 $ 171.84

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

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 %.

13 unchanged sentences

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.

In June 2024, the Company began making principal payments related to that certain loan and security agreement (the “Loan and Security Agreement”) with Avenue Capital Management II, L.P.

and related entities (together, “Avenue”) in the amount of $ 833,333 per month plus interest.

On November 22, 2024, the Company entered into an amendment of the Avenue Loan (the “First Amendment”), whereby the Lender agreed to defer principal and interest payments on the amounts outstanding until March 2025.

In connection with the First Amendment, the Company granted an aggregate of 23,771 shares of its common stock to the Lender.

The price per share was based on the Company’s five trading-day volume-weighted average price (VWAP) preceding the date of the First Amendment of approximately $ 8.42 per share.

The shares have a gross value of approximately $ 200,000 .

This is accounted for as a component of debt discount.

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.

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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.

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

Non-Convertible Note

Convertible Note

Private Placement Shares

Withheld From Proceeds:

Legal Reimbursement

Eyenovia Origination Costs:

Avenue Management Fee

The following is a summary of the Avenue loan at December 31, 2024:

2 unchanged sentences

Aggregate Loan Funding

Capitalized Interest Added To Loan Balance

Final Payment

Unamortized debt discount

( 5,000,000 )

Unamortized Debt Discount

Current Portion

1 unchanged sentence

( 4,736,070 )

( 9,948,602 )

Notes Payable, Non-Current

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.

During the years ended December 31, 2024 and 2023, the Company recorded interest expense relating to the Avenue Loan of $ 2,468,863 (which includes $ 759,049 of amortization of debt discount) and $ 2,359,157 (which includes $ 681,860 of amortization of debt discount), respectively.

EYENOVIA, INC.

1 unchanged sentence

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

See Note 15 – Subsequent Events - Avenue Ventures Loan Second Amendment.

Note 9 – Income Taxes

17 unchanged sentences

Effective income tax rate

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Deferred tax assets consist of the following:

7 unchanged sentences

Lease liability

Total gross deferred tax assets

Deferred tax liabilities:

Property and equipment

Right of use asset

Deferred tax assets, net before allowance

Total gross deferred tax assets

Valuation allowance

1 unchanged sentence

( 30,363,326 )

Deferred tax assets, net

Deferred tax assets, net of valuation allowance

Deferred tax liabilities

Property and equipment

Right of use asset

Deferred tax liabilities, net

Changes in valuation allowance

1 unchanged sentence

( 4,532,592 )

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

As of December 31, 2024, the Company had approximately $ 133,700,000 of domestic federal net operating loss carryforwards, or NOLs, that may be available to offset future federal taxable income.

12 unchanged sentences

The Company’s federal, state and local income tax returns beginning with the year ended December 31, 2021 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.

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.

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 .

EYENOVIA, INC.

1 unchanged sentence

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

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.

Note 10 – Commitments and Contingencies

Employment Agreements

As of December 31, 2024, the aggregate potential severance pay for the executive officers of the Company is approximately $ 1,029,000 .

Defective Clinical Supply

During the third quarter of 2023, a certain portion of clinical supply product sold by the Company to Bausch + Lomb was determined to be defective.

On April 23, 2024, the Company and Bausch + Lomb executed a letter agreement (the “Side Letter”) pursuant to which the Company and Bausch + Lomb agreed that the Company would pay approximately $ 0.4 million to Bausch + Lomb related to the defective clinical supply which charge was included within other income (expense) during the year ended December 31, 2023, because the original sales to the licensee were recorded on that line item.

See Note 2 – Summary of Significant Accounting Policies - Bausch License Agreements.

Operating Leases

3 unchanged sentences

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.

The Company’s rent expense for all Laguna Hills space is recorded in selling, general and administrative expense and amounted to $ 117,890 and $ 118,746 for the years ended December 31, 2024 and 2023, respectively.

As of December 31, 2024, the Company recorded an impairment of the right-of-use asset of $ 116,000 associated with this lease in the Company’s financial statements due to the uncertainty associated with its operations and its exploration of strategic alternatives.

In May 2022, the Company entered into a lease agreement to lease 10,880 square feet of office space in Reno, Nevada.

3 unchanged sentences

The Company’s rent expense for this space is recorded in research and development expense and amounted to $ 169,303 and $ 164,950 for the years ended December 31, 2024 and 2023, respectively.

As of December 31, 2024, the Company recorded an impairment of the right-of-use asset of $ 80,000 associated with this lease in the Company’s financial statements due to the uncertainty associated with its operations and its exploration of strategic alternatives.

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.

4 unchanged sentences

The Company’s rent expense for this space is recorded in research and development expense and amounted to $ 193,591 and $ 192,710 for the years ended December 31, 2024 and 2023, respectively.

As of December 31, 2024, the Company recorded an impairment of the right-of-use asset of $ 125,000 associated with this lease in the Company’s financial statements due to the uncertainty associated with its operations and its exploration of strategic alternatives.

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.

3 unchanged sentences

The security deposit is $ 117,800 .

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.

The Company’s rent expense for this space is recorded in selling, general and administrative expense and amounted to $ 220,394 and $ 233,534 for the years ended December 31, 2024 and 2023, respectively.

As of December 31, 2024, the Company recorded an impairment of the right-of-use asset of $ 99,000 associated with this lease in the Company’s financial statements due to the uncertainty associated with its operations and its exploration of strategic alternatives.

EYENOVIA, INC.

22 unchanged sentences

The Company records legal costs associated with loss contingencies as incurred and accrues for all probable and estimable settlements.

Senju License Agreement

See Note 11 – Related Party Transactions - Senju License Agreement for a related party agreement entered into with Senju.

Note 11 – Related Party Transactions

See Note 9 - Commitments and Contingencies for certain commitments and contingencies entered into with certain related parties.

Senju License Agreement

26 unchanged sentences

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

Advisory Agreement

In August 2022, the Company entered into an agreement with Dr.

Ianchulev, or the Executive Chairman Agreement, pursuant to which Dr.

Ianchulev agreed to 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 .

The terms allowed for the agreement to be extended by mutual agreement of the parties.

In consideration for Dr.

Ianchulev’s services, the Company 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.

As of December 31, 2024, the agreement was still in effect.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Note 12 – Stockholders’ (Deficiency) Equity

Authorized Capital

2 unchanged sentences

The Board of Directors is empowered, without stockholder approval, to issue preferred stock with dividend, liquidation, redemption, voting or other rights.

On June 12, 2024, at the Annual Shareholders’ Meeting, the Company proposed and the shareholders approved an increase in the authorized number of shares of the Company’s common stock from 90,000,000 to 300,000,000 at the same par value of $ 0.0001 per share.

Equity Incentive Plans

2 unchanged sentences

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

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.

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 paid during the year, of $ 150,000 , subject to certain exceptions for a non-executive chair of the Board.

As of December 31, 2024, the number of securities remaining available for future issuance under equity compensation plans was 14,227 .

At-The-Market Offering

On January 21, 2025, the stockholders approved an amendment to the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan to reserve an additional 350,000 shares of the Company’s common stock for issuance (see Note 15 – Subsequent Events, Increase of 2018 Omnibus Stock Incentive Plan Shares).

Common Stock Issuances

Pursuant to the License and certain milestone achievements, the Company issued 7,668 shares of common stock valued at $ 0.4 million on April 29, 2024 to Formosa (see Note 5 – Intangible Assets).

On May 3, 2024, the Company issued Bausch + Lomb 28,742 shares of the Company’s common stock, valued at $ 2.3 million, in satisfaction of its obligations pursuant to the Letter Agreement (see Note 2 – Summary of Significant Accounting Policies - Bausch License Agreements).

At-The-Market Program

December 2021 Sales Agreement

5 unchanged sentences

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

EYENOVIA, INC.

1 unchanged sentence

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Warrants, the “Warrants”).

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 23,327 shares of its common stock under the December 2021 Sales Agreement with Leerink Partners, LLC, formerly known as SVB Securities (“Leerink Partners”).

During the year ended December 31, 2024, the Company received approximately $ 6.2 million in gross proceeds and $ 6.0 million in net proceeds from the sale of 70,382 shares of its common stock under the December 2021 Sales Agreement with Leerink Partners.

On December 30, 2024, the Company entered into an Amended and Restated Sales Agreement (the “A&R Sales Agreement”) with Chardan Capital Markets, LLC (“Chardan”) with respect to the Company’s existing at-the-market offering program.

The A&R Sales Agreement amends and restates the December 2021 Sales Agreement by and between the Company and Leerink Partners to, among other things, replace Leerink Partners with Chardan as sales agent.

The Company will pay Chardan a commission equal to three percent (3.0)% of the gross sales proceeds of any common stock sold through Chardan under the December 2021 Sales Agreement, and also has provided Chardan with certain indemnification rights.

At December 31, 2024, no shares had settled under the A&R Sales Agreement with Chardan.

August 2023 Offering and Warrant Modification

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”), 52,483 shares of common stock, pre-funded warrants to purchase up to 28,162 shares of common stock and warrants to purchase up to 60,484 shares of common stock (the “Common Warrants” and, together with the Pre-Funded Warrants, the “Warrants”).

The combined offering price for each share of common stock and accompanying Common Warrant was $ 148.80 , and the combined offering price for each Pre-Funded Warrant and accompanying Common Warrant was $ 148.00 .

5 unchanged sentences

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.

In connection with the August 2023 Offering, 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 $ 283.20 per share of common stock to $ 178.40 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.

1 unchanged sentence

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.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

2024 Offerings and Warrant Modification

A summary of the 2024 offerings is presented below:

Stockholders’

April Offering

July Offering

August Offering

September Offering

November Offering

December Offering

April Offering

On April 8, 2024, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with a single fundamentals-based healthcare investor (the “Purchaser”), pursuant to which the Company agreed to sell, in a registered direct offering by the Company directly to the Purchaser (the “April 2024 Offering”), 40,297 shares of common stock.

The price per share in the April 2024 Offering was $ 49.63 .

The aggregate gross proceeds to the Company from the 2024 April Offering were $ 2.0 million, and net proceeds after offering costs were approximately $ 1.9 million.

July Offering and Warrant Amendment

On July 1, 2024, the Company closed on a registered direct offering (the “July 2024 Offering”) with certain institutional and accredited investors (the “July 2024 Investors”), pursuant to which the Company sold 94,697 shares of common stock and warrants to purchase up to 94,697 shares of common stock.

The combined offering price for each share of common stock and accompanying warrant was $ 52.80 .

The Company also agreed to issue warrants to purchase an additional 21,872 shares of common stock (the “Additional Warrants”) to one of the July 2024 Investors.

All of the new warrants become exercisable six months following their issuance, at an exercise price of $ 55.20 per share, and may be exercised until January 2, 2030.

In connection with the July 2024 Offering, the Company entered into warrant amendment agreements (the “Amendments”) with the holders of previously issued warrants (the “Prior Warrants”) to purchase up to an aggregate of 129,828 shares of common stock, whereby the Company agreed to amend the Prior Warrants to reduce the exercise price of the Prior Warrants from $ 178.40 and $ 197.60 per share of common stock to $ 55.20 per share of common stock, extend the term of the Prior Warrants until January 2, 2030 and prohibit exercise of the Prior Warrants for the six-month period following the effective date of the Amendments.

The aggregate gross proceeds to the Company from the July 2024 Offering were approximately $ 5.0 million, and net proceeds after cash offering costs were approximately $ 4.3 million.

Offering costs include placement agent fees of $ 0.4 million and Company legal fees of $ 0.3 million.

In addition, there were $ 2.9 million of non-cash issuance costs which represents the value of the Additional Warrants, plus the modification date incremental value of the modified Prior Warrants as compared to the original Prior Warrants, as an issuance cost of the warrant exercise.

August Offering

On August 21, 2024, the Company agreed to sell 160,624 shares of common stock to certain institutional and accredited investors (the “August Investors”), in some cases pursuant to a securities purchase agreement (the “August 2024 Offering”).

The price per share in the August 2024 Offering was $ 32.00 .

The aggregate gross proceeds to the Company from the August 2024 Offering were approximately $ 5.1 million, and net proceeds after offering costs were approximately $ 4.5 million.

September Offering and Warrant Amendment

On September 30, 2024, the Company closed on a registered direct offering (the “September 2024 Offering”) with a certain purchaser, pursuant to which the Company sold to the purchaser 107,875 shares of common stock;

pre-funded warrants to purchase up to 821

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

shares of common stock;

and warrants to purchase up to 108,696 shares of common stock at an exercise price of $ 40.00 per share.

The combined offering price for each share and accompanying warrant was $ 36.80 .

The combined offering price for each pre-funded warrant and accompanying Warrant was $ 36.79 , which is equal to the purchase price per share in the September 2024 Offering, minus $ 0.008 , the exercise price per share of the pre-funded warrants.

The warrants will be exercisable beginning six months following the date of issuance and may be exercised until March 31, 2030.

The aggregate gross proceeds to the Company from the September 2024 Offering were approximately $ 4.0 million, and net proceeds after offering costs were approximately $ 3.6 million.

On October 1, 2024, the holder of the 821 pre-funded warrants issued in the September Offering, exercised the pre-funded warrants at a price of $ 0.008 per share of common stock.

In connection with the December Offering, the Company entered into an amendment of the September Offering warrants to require stockholder approval to be exercisable and the termination date to be five years after stockholder approval.

Subsequently, on January 21, 2025, the stockholders voted to approve the exercise of the September Offering warrants (see Note 15 – Subsequent Events - Stockholder Approval of Warrants).

November Offering and Warrant Amendment

On November 24, 2024, the Company closed on a registered direct offering (the “November 2024 Offering”) with an institutional investor, pursuant to which the Company sold to the purchaser 112,500 shares of common stock;

pre-funded warrants to purchase up to 38,522 shares of common stock;

and warrants to purchase up to 302,045 shares of common stock at an exercise price of $ 8.608 per share.

The combined offering price for each share and accompanying warrant was $ 8.608 The combined offering price for each pre-funded warrant and accompanying Warrant was $ 8.60 , which is equal to the purchase price per share in the November 2024 Offering, minus $ 0.008 , the exercise price per share of the pre-funded warrants.

The warrants will be exercisable beginning six months following the date of issuance and may be exercised until November 24, 2029.

The aggregate gross proceeds to the Company from the November 2024 Offering were approximately $ 1.3 million, and net proceeds after offering costs were approximately $ 1.1 million.

On November 25, 2024, the holder of the 38,522 pre-funded warrants issued in the November Offering, exercised the pre-funded warrants at a price of $ 0.008 per share of common stock.

In connection with the December Offering, the Company entered into an amendment of the November Offering warrants to require stockholder approval to be exercisable and the termination date to be five years after stockholder approval.

Subsequently, on January 21, 2025, the stockholders voted to approve the exercise of the November Offering warrants (see Note 15 – Subsequent Events - Stockholder Approval of Warrants).

December Offering

On December 5, 2024, the Company closed on a registered direct offering (the “December 2024 Offering”) with an institutional investor, pursuant to which the Company sold to the purchaser 137,500 shares of common stock;

pre-funded warrants to purchase up to 113,563 shares of common stock;

and warrants to purchase up to 502,126 shares of common stock at an exercise price of $ 7.752 per share.

The combined offering price for each share and accompanying warrant was $ 7.752 .

The combined offering price for each pre-funded warrant and accompanying Warrant was $ 7.744 , which is equal to the purchase price per share in the December 2024 Offering, minus $ 0.008 , the exercise price per share of the pre-funded warrants.

The warrants required stockholder approval to be exercisable and the termination date to be five years after stockholder approval.

The aggregate gross proceeds to the Company from the December 2024 Offering were approximately $ 1.9 million, and net proceeds after offering costs were approximately $ 1.7 million.

On December 11, 2024, the holder of the 113,563 pre-funded warrants issued in the December Offering, exercised the pre-funded warrants at a price of $ 0.008 per share of common stock.

Subsequently, on January 21, 2025, the stockholders voted to approve the exercise of the December Offering warrants (see Note 15 – Subsequent Events - Stockholder Approval of Warrants).

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

The issuance date or modification date fair value of stock warrants issued or modified during the years ended December 31, 2024 and 2023 was determined using the Black Scholes method, with the following assumptions used:

For the Years Ended

Risk free interest rate

4.39 % - 5.22 %

Expected term

0.7 - 5.5 years

4.0 - 5.5 years

Expected volatility

Expected dividends

A summary of the warrant activity during the year ended December 31, 2024 is presented below:

1 unchanged sentence

Repriced - (Old) (2)

( 4,870,130 )

Repriced - (New) (2)

( 2,252,979 )

Exercised (1)

Outstanding December 31, 2024

Exercisable December 31, 2024

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

(1) Warrants granted and exercised exclude 152,916 Pre-Funded Warrants with an exercise price of $ 0.0001 .

(2) Repriced warrants represent the reset of the exercise price of certain warrants to purchase 129,828 shares of common stock to a price of $ 55.20 per share.

The following table presents information related to warrants as of December 31, 2024:

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Remaining Life

(1) - These warrants become exercisable on or about February 24, 2024.

(1) These warrants become exercisable on January 21, 2025.

(2) These warrants become exercisable on January 1, 2025.

During the year ended December 31, 2024, Pre-Funded Warrants for the purchase of 152,905 shares of the Company’s common stock with an exercise price of $ 0.008 per share were exercised for aggregate proceeds of $ 1,223 .

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

During the year ended December 31, 2023, warrants for the purchase of 28,162 shares of the Company’s common stock with an exercise price of $ 0.80 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.

For the years ended December 31, 2024 and 2023, the Company recorded stock-based compensation expense of $ 1,704,273 ($ 623,049 of which was included within research and development expenses and $ 1,081,224 was included within selling, general and administrative expenses on the statements of operations) and $ 2,497,890 ($ 839,038 of which was included within research and development expenses and $ 1,658,852 was included within selling, general and administrative expenses on the statements of operations), respectively.

Restricted Stock Units

5 unchanged sentences

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.

On June 12, 2024, the Company granted members of its Board of Directors an aggregate of 4,608 RSUs under the Restated Plan.

Each RSU is subject to settlement into one share of the Company’s common stock.

1 unchanged sentence

The RSUs had a grant date fair value of $ 239,772 , which will be recognized over the vesting period.

In 2022, there was 108,366 of common shares issued related to vested RSUs.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

In 2024, there were no shares of common stock issued related to vested RSUs.

Between June 27, 2023 and November 14, 2023, the Company granted members of its Board of Directors an aggregate of 1,322 RSUs under the Restated Plan.

2 unchanged sentences

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.

In 2023, there were 597 of common shares issued related to vested RSUs.

As of December 31, 2024, there was $ 109,897 of unrecognized stock-based compensation expense related to RSUs which will be recognized over a weighted average period of 0.45 years.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Stock Options

3 unchanged sentences

Exercisable, December 31, 2024

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, 2024:

Options Outstanding

Options Exercisable

Remaining Life

5 unchanged sentences

$ 400 - $ 479.99

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

$ 480 - $ 559.9

In applying the Black-Scholes option pricing model to stock options granted, the Company used the following approximate assumptions:

13 unchanged sentences

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.

Treasury zero-coupon bonds with a remaining term consistent with the expected term of

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

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.

7 unchanged sentences

For the years ended December 31, 2024 and 2023, the Company recorded expense of $ 264,104 and $ 218,170 associated with its matching contributions, respectively.

Note 14 – Segment Reporting

The Company has one operating and reporting segment (ophthalmic technology), namely, the development and commercialization of ophthalmic solutions.

The accounting policies of the segment are the same as those described in the summary of significant accounting policies.

The chief operating decision maker (“CODM”), who is the Company’s chief executive officer, utilizes the Company’s financial information on an aggregate basis for purposes of making operating decisions, allocating resources and assessing financial performance, as well as for making strategic operations decisions and managing the organization.

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

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

The Company’s significant expenses reviewed by the CODM for the years ended December 31, 2024 and 2023 are as follows:

For the Years Ended

Cost of revenue

( 3,927,228 )

( 3,869,892 )

Research and Development:

Salaries and benefits

Direct clinical and non-clinical expenses

Supplies and materials

Depreciation expense

Facilities expenses

Non-cash stock based compensation expenses

Other Expenses (1)

Selling General and Administrative:

Salaries and benefits

Professional fees

Non-cash stock based compensation

FDA PDUFA fees

Insurance expense

Sales and marketing

Investor relations

Travel, lodging and meals

Other Expenses (2)

Facilities expense

Director fees and expense

Reacquisition of license rights

Asset impairments

Total Expense:

Loss from Operations

( 48,738,225 )

( 25,406,445 )

Other (expense) income, net (3)

( 1,080,208 )

( 1,854,650 )

( 49,818,433 )

( 27,261,095 )

(1) Other research and development expenses include outsourced engineering and IT systems used for research and development.

(2) Other selling, general, and administrative expenses include, distribution for specialty pharmacy networks, Nasdaq / SEC fees, software services, corporate tax, and depreication expense.

(3) All other items include gains and losses in the change in fair value of equity consideration payable, interest expense, net of interest income, and other non operating expenses.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Note 15 – 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.

January 2025 Offering

On January 16, 2025, the Company entered into an Inducement Offer (the “Inducement Offer”) with an Investor (the “Investor”), by which the Company agreed to reduce the exercise price of 197,118 existing warrants (“the Existing Warrants”) from $ 55.20 per share, to $ 5.272 per share.

The Inducement Offer had a limited exercise period, until January 17, 2025, to exercise the Existing Warrants (the “Exercise Period”).

In connection with the Inducement Offer, if the Investor exercised the Existing Warrants within the Exercise Period, the Company agreed to issue 197,118 Series A Common Stock Purchase Warrants and 197,118 Series B Common Stock Purchase Warrants to purchase an additional 394,236 shares of common stock at an exercise price of $ 5.272 per share which may be exercised for five years from the initial exercise date.

The warrants become exercisable upon stockholder approval.

On January 17, 2025, the Investor exercised the Existing Warrants within the Exercise Period.

The aggregate gross cash proceeds to the Company from the inducement offer were approximately $ 1.0 million, and net cash proceeds after offering costs were approximately $ 0.9 million.

Stockholder Approval of 2024 Warrants

On January 21, 2025, in connection with the December Offering, the stockholders approved the exercise of the September Offering warrants, the November Offering warrants and the December Offering warrants (see Note 12 – Stockholders’ Equity - Offerings).

Reverse Stock Split

On January 31, 2025, the Company effected the Reverse Split of its common stock at a ratio of 1-for-80 .

Upon the effectiveness of the Reverse Split, every 80 issued shares of common stock were reclassified and combined into one share of common stock.

In addition, the number of shares of common stock issuable upon the exercise of the Company’s equity awards, convertible securities and warrants was proportionally decreased, and the corresponding conversion price or exercise price was proportionally increased.

No fractional shares were issued as a result of the Reverse Split, stockholders who would otherwise be entitled to receive a fractional share will be entitled to receive a cash payment in lieu of such fractional share.

Avenue Ventures Loan Second Amendment

On February 21, 2025, the Company entered into a second amendment of the Avenue Loan Agreement (the “Second Amendment”) whereby the Lender agreed to defer principal and interest payments on amounts outstanding until the end of September 2025.

Deferred interest will accrue on the outstanding principal amount at the interest rate stated in the original Avenue Loan.

Under the Second Amendment, the Company has agreed to use a portion of the proceeds (net of fees and commissions payable to Chardan) received from sales under the A&R Sales Agreement (the “A&R Proceeds”) to pay down the outstanding principal amount under the Avenue Loan Agreement as follows:

a) until the Company raises $ 3.0 million of aggregate A&R Proceeds, 65 % of the A&R Proceeds shall be remitted to the Lenders as a payment in respect of the outstanding principal amount, and b) after the Company raises $ 3.0 million of aggregate A&R Proceeds, 75 % of the A&R Proceeds shall be remitted to the Lenders as a payment in respect of the outstanding principal amount.

Pursuant to the Second Amendment, at any time on or after April 1, 2025, the Lenders will also have the right, in their discretion, but not the obligation, to convert an aggregate amount of up to $ 10.0 million of the aggregate principal amount under the Avenue Loan Agreement into shares of the Company’s common stock, at a price equal to $ 1.68 per share.

EYENOVIA, INC.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Increase and Issuance of 2018 Omnibus Stock Incentive Plan Shares

On January 21, 2025, the stockholders approved an amendment to the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan to reserve an additional 350,000 shares of the Company’s common stock for issuance thereunder, which number will not be adjusted as a result of the Reverse Split.

On February 5, 2025, the Company granted 240,000 shares of restricted stock units in the aggregate to consultants and employees.

The shares vest on the earliest of (i) one year from the date of issuance, (ii) a change in control of the Company, and (iii) with respect to employees, the date on which their employment with the Company is terminated, other than by such employee’s voluntary resignation.

At-The-Market Program

Subsequent to December 31, 2024, the Company received approximately $ 5.9 million in gross proceeds from the sale of 1,127,100 shares of its common stock pursuant to its Sales Agreement with Chardan in its “at-the-market” offering.

In connection with the Second Amendment mentioned above, the Company paid Avenue $ 777,369 in gross proceeds received from the at-the-market offering, which was equivalent to 65 % of the proceeds raised from February 21, 2025 to March 31, 2025.

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

What changed 10-K

Item 9A. Controls and Procedures