Lightwave Logic, Inc. Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>Lightwave Logic, Inc. has filed its quarterly report (10-Q) for the period ending March 31, 2024, detailing its financial activities and operational status.</b>

AI Summary

Lightwave Logic, Inc. (LWLG) filed a Quarterly Report (10-Q) with the SEC on May 10, 2024. Lightwave Logic, Inc. filed its 10-Q report for the quarterly period ended March 31, 2024. The filing covers the period from January 1, 2024, to March 31, 2024. The company's fiscal year ends on December 31. Previous filings indicate a Purchase Agreement with an Institutional Investor dated February 28, 2023. A Sales Agreement with an Institutional Investor was dated December 8, 2022.

Why It Matters

For investors and stakeholders tracking Lightwave Logic, Inc., this filing contains several important signals. This 10-Q filing provides investors with the latest financial performance and operational updates for Lightwave Logic, Inc. for the first quarter of 2024. Understanding the details within this report is crucial for assessing the company's current financial health, strategic direction, and potential future performance.

Risk Assessment

Risk Level: medium — Lightwave Logic, Inc. shows moderate risk based on this filing. The company's financial performance and operational status are detailed in this 10-Q, but specific financial results like revenue, net income, or debt levels are not provided in the header information, requiring a deeper dive into the full document for a comprehensive risk assessment.

Analyst Insight

Review the full 10-Q filing to analyze Lightwave Logic's financial statements, management discussion, and risk factors for a complete understanding of its current standing.

Key Numbers

• 2024-03-31 — Reporting Period End Date (Quarterly period ended March 31, 2024)
• 2024-05-10 — Filing Date (Date the 10-Q was filed)
• 2024-01-01 — Quarter Start Date (Beginning of the reporting period)
• 2023-02-28 — Purchase Agreement Date (Date of a Purchase Agreement with an Institutional Investor)
• 2022-12-08 — Sales Agreement Date (Date of a Sales Agreement with an Institutional Investor)

Key Players & Entities

• Lightwave Logic, Inc. (company) — Filer and subject of the report
• 2024-03-31 (date) — End of the reporting period
• 2024-05-10 (date) — Filing date
• 0001325964 (company) — Central Index Key for Lightwave Logic, Inc.
• 2023-02-28 (date) — Date of a Purchase Agreement
• 2022-12-08 (date) — Date of a Sales Agreement

FAQ

Industry Context

Lightwave Logic operates in the technology sector, likely focusing on advanced materials or components, as indicated by its SIC code for Miscellaneous Plastic Products and historical company names suggesting nanotechnology.

Regulatory Implications

This filing is made under the Securities Exchange Act of 1934, requiring public companies to submit regular financial disclosures to the SEC.

What Investors Should Do

1. Analyze the detailed financial statements within the 10-Q for revenue, expenses, and cash flow.
2. Review the Management's Discussion and Analysis (MD&A) section for insights into operational performance and future outlook.
3. Examine the Risk Factors section for any new or updated risks identified by the company.

Key Dates

• 2024-03-31: Quarterly Period End — Marks the end of the reporting period for the 10-Q filing.
• 2024-05-10: Filing Date — The date Lightwave Logic, Inc. submitted its 10-Q to the SEC.

Year-Over-Year Comparison

This is the first 10-Q filing for the fiscal year 2024, providing an update from the previous year-end report (10-K).

Key Financial Figures

• $0.001 — nge on which registered Common Stock, $0.001 par value per share LWLG The NASDAQ S

Filing Documents

• lwlg_10q-033124.htm (10-Q) — 791KB
• ex31x1.htm (EX-31.1) — 7KB
• ex31x2.htm (EX-31.2) — 8KB
• ex32x1.htm (EX-32.1) — 3KB
• ex32x2.htm (EX-32.2) — 3KB
• image_033.jpg (GRAPHIC) — 142KB
• image_034.jpg (GRAPHIC) — 36KB
• image_035.jpg (GRAPHIC) — 38KB
• image_036.jpg (GRAPHIC) — 39KB
• 0001553350-24-000021.txt (&nbsp;) — 4937KB
• lwlg-20240331.xsd (EX-101.SCH) — 46KB
• lwlg-20240331_cal.xml (EX-101.CAL) — 49KB
• lwlg-20240331_def.xml (EX-101.DEF) — 146KB
• lwlg-20240331_lab.xml (EX-101.LAB) — 306KB
• lwlg-20240331_pre.xml (EX-101.PRE) — 250KB
• lwlg_10q-033124_htm.xml (XML) — 497KB

Financial Statements

Financial Statements 2 Item 2

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 19 Item 3

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 41 Item 4

Controls and Procedures

Controls and Procedures 41 Part II Other Information Item 1

Legal Proceedings

Legal Proceedings 42 Item 1A

Risk Factors

Risk Factors 42 Item 2 Unregistered Sales of Equity Securities and Use of Proceeds 43 Item 3 Defaults Upon Senior Securities 43 Item 4 Mine Safety Disclosures 43 Item 5 Other Information 43 Item 6 Exhibits 43

Signatures

Signatures 44

Forward-Looking Statements

Forward-Looking Statements This report on Form 10-Q contains, and our officers and representatives may from time to time make, "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "continuing," "ongoing," "strategy," "future," "likely," "may," "should," "could," "will" and similar references to future periods. Examples of forward-looking statements include, among others, statements we make regarding expected operating results, such as anticipated revenue; anticipated levels of capital expenditures for our current fiscal year; our belief that we have, or will have, sufficient liquidity to fund our business operations during the next 12 months; strategy for gaining customers, growth, product development, market position, financial results and reserves.

Forward-looking statements are

Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations, and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: inability to generate significant revenue or to manage growth; lack of available funding; lack of a market for or market acceptance of our products; competition from third parties; general economic and business conditions;intellectual property rights of third parties; changes in the price of our stock and dilution; regulatory constraints and potential legal liability; ability to maintain effective internal controls; security breaches, cybersecurity attacks and other significant disruptions in our information technology systems; changes in technology and methods of marketing; delays in completing various engineering and manufacturing programs; changes in customer order patterns and qualification of new customers; changes in product mix; success in technological advances and delivering technological innovations; shortages in components; production delays due to performance quality issues with outsourced components; other risks to which our Company is subject; andother factors beyond the Company's control. The ultimate correctness of these forward-looking s

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS 6 - 18 1 LIGHTWAVE LOGIC, INC. BALANCE SHEETS March 31, 2024 December 31, 2023 (Unaudited) ASSETS CURRENT ASSETS Cash and cash equivalents $ 31,509,058 $ 31,432,087 Accounts Receivable 56,760 30,376 Prepaid expenses and other current assets 696,689 1,237,621 TOTAL CURRENT ASSETS 32,262,507 32,700,084 PROPERTY AND EQUIPMENT - NET 5,397,438 4,990,790 OTHER ASSETS Intangible assets - net 1,286,663 1,254,501 Operating Lease - Right of Use - Building 2,791,199 2,838,210 TOTAL OTHER ASSETS 4,077,862 4,092,711 TOTAL ASSETS $ 41,737,807 $ 41,783,585 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 1,000,494 $ 1,447,596 Accrued bonuses and accrued expenses 500,049 599,430 Accounts payable and accrued expenses - related parties 97,597 313,483 Deferred revenue 35,708 39,875 Deferred lease liability 27,852 38,297 Operating lease liability 149,962 144,120 TOTAL CURRENT LIABILITIES 1,811,662 2,582,801 LONG TERM LIABILITIES Operating lease liability 2,726,901 2,766,970 TOTAL LONG TERM LIABILITIES 2,726,901 2,766,970 TOTAL LIABILITIES 4,538,563 5,349,771 STOCKHOLDERS' EQUITY Preferred stock, $ 0.001 par value, 1,000,000 authorized, no shares issued or outstanding — — Common stock $ 0.001 par value, 250,000,000 authorized, 119,795,941 and 118,137,309 issued and outstanding at March 31, 2024 and December 31, 2023 119,796 118,137 Additional paid-in-capital 170,998,846 164,619,363 Deferred compensation ( 368,094 ) ( 432,293 ) Accumulated deficit ( 133,551,304 ) ( 127,871,393 ) TOTAL STOCKHOLDERS' EQUITY 37,199,244 36,433,814 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 41,737,807 $ 41,783,585 See accompanying notes to these financial statements. 2 LIGHTWAVE LOGIC, INC. STATEMENTS OF COMPREHENSIVE LOSS FOR THE THREE MONTHS ENDING MARCH 31, 2024 AND 2023 (UNAUDITED) For the Three For the

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS MARCH 31, 2024 AND 2023 NOTE 1 – NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Financial Statements

Financial Statements The accompanying unaudited financial statements have been prepared by Lightwave Logic, Inc. (the "Company"). These statements include all adjustments (consisting only of its normal recurring adjustments) which management believes necessary for a fair presentation of the statements and have been prepared on a consistent basis using the accounting polices described in the Summary of Significant Accounting Policies included in the financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the Securities and Exchange Commission on February 29, 2024 (the "2023 Annual Report"). Certain financial information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission, although the Company firmly believes that the accompanying disclosures are adequate to make the information presented not misleading. The financial statements should be read in conjunction with the financial statements and notes thereto included in the 2023 Annual Report. The interim operating results for the three months ending March 31, 2024 may not be indicative of operating results expected for the full year. Nature of Business Lightwave Logic, Inc. (the "Company") is a technology company focused on development of next generation electro-optic photonic devices made on its P 2 IC technology platform which we have detailed as: 1) Polymer Stack, 2) Polymer Plus, and 3) Polymer Slot. Our unique polymer technology platform uses in-house proprietary high-activity and high-stability organic polymers. Electro-optical devices called modulators convert data from electric signals into optical signals for multiple applications. The Company's first revenue stream is from a technology material supply and l

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS MARCH 31, 2024 AND 2023 NOTE 1 – NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Revenue associated with the sale of the Company's patented electro-optic polymer materials for incorporation into the customers' commercial photonic devices or for their device development and evaluation activities will be recognized at the time title passes, which is typically at the time of shipment or at the time of delivery, depending upon the contractual agreement between the parties. Cost of Sales Cost of sales consists of labor costs, material costs and manufacturing overhead costs associated with the production of materials transferred to the customer under the technology license and material supply agreement at the Company's facility. Stock-based Payments The Company accounts for stock-based compensation under the provisions of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 718, "Compensation - Stock Compensation", which requires the measurement and recognition of compensation expense for all stock-based awards made to employees and directors based on estimated fair values on the grant date. The fair value of restricted stock awards is estimated by the market price of the Company's common stock at the date of grant. Restricted stock awards are being amortized to expense over the vesting period. The Company estimates the fair value of option and warrant awards on the date of grant using the Black-Scholes model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods using the straight-line method. In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718), Improvements to Nonemployee Share-Based Payment Accounting (the "2018 Update). The amendments in the 2018 Update expand the scope of Topic 718 to include share-based payment transactions for acquiring goods and

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS MARCH 31, 2024 AND 2023 NOTE 1 – NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Recently Issued Accounting Pronouncements Not Yet Adopted As of March 31, 2024, there are no recently issued accounting standards not yet adopted which would have a material effect on the Company's financial statements. Recently Adopted Accounting Pronouncements As of March 31, 2024 and for the period then ended, there are no recently adopted accounting standards that have a material effect on the Company's financial statements. Reclassifications Certain reclassifications have been made to the 2023 financial statement in order to conform to the 2024 financial statement presentation. NOTE 2 – MANAGEMENT'S PLANS Our future expenditures and capital requirements will depend on numerous factors, including: the progress of our research and development efforts; the rate at which we can, directly or through arrangements with original equipment manufacturers, introduce and sell products incorporating our polymer materials technology; the costs of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights; market acceptance of our products and competing technological developments; and our ability to establish cooperative development, joint venture and licensing arrangements. We expect that we will incur approximately $ 1,840,000 of expenditures per month over the next 12 months. Our current cash position enables us to finance our operations through August 2025. On February 28, 2023, the Company entered into a purchase agreement with an institutional investor to sell up to $ 30,000,000 of common stock over a 36-month period (described in Note 10). Pursuant to the purchase agreement, the Company received $ 973,950 in April and May 2024 and the remaining available amount of $ 7,727,648 is available to the Company per the agreement. On December 9, 2022, the Company entered into a

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS MARCH 31, 2024 AND 2023 NOTE 3 – REVENUE (CONTINUED) The Company's first commercial agreement occurred in May 2023, in the form of a four-year material supply and license agreement (the "License Agreement") that incorporates the Company's patented electro-optic polymer materials for use in manufacturing of photonic devices (the "Licensed Product"). The licensee shall pay the Company a running royalty with a minimum royalty paid on an annual basis over the term of the License Agreement. Additional future revenue will be generated from royalties from the licensee's sale of Licensed Product that exceed the minimum royalty payments and milestone license fees. The License Agreement is a non-exclusive material supply and license agreement. During 2024, the Company performed device poling work for a customer. Timing of Revenue Recognition and Contract Balances Revenues related to the initial license fee and a minimum annual royalty are recognized over time commencing with the License Agreement in May 2023. An up-front license fee in the amount of $ 50,000 was paid during the period ending December 31, 2023. $ 35,708 of this amount is recorded in short term liability deferred revenue in the Company's balance sheet as of March 31, 2024. For the three months ended March 31, 2024, the Company recognized $ 16,667 in revenue related to this agreement. In March 2024, the Company completed coating and poling work on the devices supplied by a customer. Revenue for this contract was recognized at the time of shipment of the devices back to the customer and amounted to $ 13,750 for the three months ended March 31, 2024. Contract balances are as follows: Schedule of contract balances March 31, 2024 December 31, 2023 Accounts receivable, net $ 56,760 $ 30,376 Short-term contract assets $ — $ — Long-term contract assets $ — $ — Short-term liability deferred revenue $ 35,708 $ 39,875 Long-term liability deferred revenue $ —

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS MARCH 31, 2024 AND 2023 NOTE 4 – PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of the following: Schedule of prepaid expenses and other current assets March 31, 2024 December 31, 2023 License $ 263,101 $ 241,936 Insurance 133,336 237,791 Materials fabrication 89,880 475,936 Investor relations 80,069 6,313 Prototype devices 48,318 161,267 Other 45,460 53,373 Rent 36,525 36,525 Deposit for equipment — 20,000 Lease incentive receivable — 4,480 Prepaid expenses and other current $ 696,689 $ 1,237,621 NOTE 5 – LOAN RECEIVABLE On September 7, 2022, the Company entered into a convertible loan agreement (the "Loan") with an entity and issued a loan on September 12, 2022 in the amount of EUR 600,000 bearing interest at 7 % per annum with a maturity date of March 31, 2023 . The loan and interest were repaid in February and March 2023. The Company recorded $ 11,125 of interest income for the three months ended March 31, 2023 and used the average exchange rate for the conversion of the EUR denominated interest income for the period. NOTE 6 – PROPERTY AND EQUIPMENT Property and equipment consist of the following: Schedule of property and equipment March 31, 2024 December 31, 2023 Office equipment $ 152,439 $ 146,196 Lab equipment 9,534,549 8,937,847 Furniture 74,119 74,119 Leasehold improvements 396,111 396,111 Softwa