Lightwave Logic(LWLG) - 2022 Q4 - Annual Report

Financial Performance - Lightwave Logic, Inc. had no revenues for the years ended December 31, 2022, 2021, and 2020, as it is in various stages of photonic device and materials development [297]. - Net loss for the year ended December 31, 2022, was $17,230,480, a decrease of 8% from $18,631,381 in 2021 [310]. - Research and development expenses for the year ended December 31, 2022, were $12,805,374, an increase of 3% from $12,476,040 in 2021 [298]. - Research and development expenses increased by $7,885,495 (172%) from $4,590,545 in 2020 to $12,476,040 in 2021 [298]. - General and administrative expenses decreased to $4,334,290 for the year ended December 31, 2022, down 4% from $4,520,403 in 2021 [298]. - Other income (expenses) improved significantly, decreasing to $(90,816) in 2022 from $(1,634,938) in 2021, a reduction of 94% [308]. Cash Flow and Financing - Net cash used in operating activities for 2022 was $10,465,880, primarily due to the net loss adjusted by various expenses [324]. - Cash and cash equivalents as of December 31, 2022, totaled $24,102,151, with total assets of $29,263,472 and stockholders' equity of $27,553,023 [326]. - The company received $12,775,268 in proceeds from the 2021 purchase agreement with an institutional investor during 2022 [315]. - Net cash provided by financing activities for 2022 was $13,345,141, consisting of proceeds from the exercise of options and warrants and resale of common stock [326]. - The 2021 Purchase Agreement allows the company to sell up to $33 million of common stock over a 36-month period, with $2,126,557 remaining as of the latest filing [314]. - The 2023 Purchase Agreement enables the company to sell up to $30 million of common stock over a 36-month period, with $30 remaining as of the latest filing [314]. - The company anticipates cash used in operations will continue to increase in 2023 due to planned activities and expansion efforts [319]. - The company had no debt to service as of the latest reporting period [318]. Investment and Assets - Net cash used by investing activities was $217,984 for the year ended December 31, 2020, primarily for intangibles and asset additions for the new Colorado headquarters and labs [333]. - Net cash provided by financing activities was $6,162,093 for the year ended December 31, 2020, including $1,658,442 from warrant exercises and $5,173,300 from common stock resale [334]. - As of December 31, 2020, cash and cash equivalents totaled $3,306,590, with total assets of $7,366,778 and stockholders' equity of $5,775,446 [334]. - As of December 31, 2022, cash and cash equivalents increased to $24,102,151, indicating strong liquidity [336]. Business Strategy and Market Focus - The company aims to partner with silicon-based foundries to scale volume quickly and efficiently for its polymer modulator devices [287]. - The patent portfolio is being optimized through traditional product development, patent licensing, and technology transfer to foundries [288]. - The company anticipates revenue streams from technology licensing agreements, joint ventures, and direct sales of electro-optic device components [290]. - Lightwave Logic is targeting applications in fiber optic data communications and telecommunications, with plans to explore automotive/LIDAR and sensing markets [289]. - The company expects initial modulator products to operate at symbol rates of at least 112 Gigabaud, equating to roughly 200Gbps with PAM4 encoding [293]. Risk Management - The company does not use market risk sensitive instruments for hedging or trading purposes, minimizing financial market risk exposure [338]. - A 10% change in interest rates as of December 31, 2022, would not have materially affected the fair value of the investment portfolio [337].