LENZ Therapeutics, Inc.

Previous wording

We are a pre-commercial biopharmaceutical company focused on the development and commercialization of innovative therapies to improve vision. Our initial focus is the treatment of presbyopia, the inevitable loss of near vision that impacts the daily lives of nearly all people over 45. In the United States, the estimated addressable population who suffer from this condition, known as presbyopes, is 128 million, almost four times the number of individuals suffering from dry eye disease and three times the number of individuals suffering from childhood myopia, macular degeneration, diabetic retinopathy and glaucoma combined. We believe that a once-daily pharmacological eye drop that can effectively and safely improve near vision throughout the full workday, without the need for reading glasses, could be a highly attractive commercial product with an estimated U.S. market opportunity in excess of $3 billion. It is our goal to develop and commercialize such a product, and we have assembled an executive team with extensive clinical and commercial experience to execute this goal and become the category leader.

Current wording

We are a commercial pharmaceutical company focused on the commercialization of VIZZ® (aceclidine ophthalmic solution) 1.44%, the first and only FDA-approved aceclidine-based eye drop for the treatment of presbyopia, a condition impacting an estimated 1.8 billion people globally and 128 million people in the United States (“U.S.”). We are commercializing VIZZ in the U.S. and continue to establish licensing partnerships internationally to provide access to VIZZ globally. We believe that a once-daily pharmacological eye drop that can effectively and safely improve near vision throughout the full workday, without the need for reading glasses, is a highly attractive commercial product with an estimated U.S. market opportunity in excess of $3 billion. It is our goal to successfully commercialize VIZZ, and we have assembled an executive team with extensive clinical and commercial experience to execute this goal and become the category leader.

Previous wording

As of December 31, 2024, we had $209.1 million of cash, cash equivalents, restricted cash, and marketable securities. We believe that our existing cash, cash equivalents and marketable securities as of December 31, 2024 will allow us to continue to build infrastructure and commercialize LNZ100, subject to FDA approval, and will be sufficient to fund the Company to positive operating cash flow subsequent to such commercial launch. We do not expect to generate any revenue from product sales unless and until we successfully obtain regulatory approval for LNZ100. We have incurred net losses in each year since inception, and as of December 31, 2024, we had an accumulated deficit of $145.0 million. These losses have resulted principally from costs incurred in connection with research and development activities and selling, general and administrative costs associated with our operations. We expect to continue to incur significant expenses and operating losses as we seek FDA approval and begin commercialization. These costs include expenses associated with the regulatory approval process and, subject to such approval, preparation for the potential commercial launch of LNZ100, subject to FDA approval. Additionally, we anticipate incurring expenses related to product sales, marketing, manufacturing, and distribution, and additional costs associated with being a public company, including audit, legal, regulatory and tax-related services associated with maintaining compliance with an exchange listing and SEC requirements. As a result of these and other factors, while we believe that our existing cash, cash equivalents and marketable securities as of December 31, 2024 will fund the Company to positive operating cash flow subsequent to commercial launch, if LNZ100 is approved, it is possible that we may require additional financing to fund our operations and planned growth.

Current wording

As of December 31, 2025, we had $292.3 million of cash, cash equivalents, restricted cash, and marketable securities. We believe that our existing cash, cash equivalents and marketable securities as of December 31, 2025 will allow us to continue to commercialize VIZZ, and will be sufficient to fund the Company to positive operating cash flow. We have incurred net losses in each year since inception, and as of December 31, 2025, we had an accumulated deficit of $227.1 million. These losses have resulted principally from costs incurred in connection with research and development activities and selling, general and administrative costs associated with our operations. We expect to continue to incur significant expenses related to product sales, marketing, manufacturing, and distribution of VIZZ as we are in the early stages of commercialization, and additional costs associated with being a public company, including audit, legal, regulatory and tax-related services associated with maintaining compliance with an exchange listing and SEC requirements. As a result of these and other factors, while we believe that our existing cash, cash equivalents and marketable securities as of December 31, 2025 will fund the Company to positive operating cash flow, it is possible that we may require additional financing to fund our operations and planned growth.

Previous wording

Through the completion of the Merger, LENZ OpCo financed its operations primarily through private placements of its common stock and convertible preferred stock. Concurrent with the closing of the Merger on March 21, 2024, we completed the March 2024 PIPE Financing of 3,559,565 shares of common stock for an aggregate gross purchase price of $53.5 million. Additionally, on July 17, 2024, we completed a private placement (the “July 2024 PIPE Financing”) with Ridgeback Capital Investments, L.P. of 1,578,947 shares of common stock for an aggregate gross purchase price of $30.0 million.

Current wording

Since our inception, we have financed our operations primarily through public offerings of our common stock, proceeds from the Merger, and private placements of our common stock and convertible preferred stock. Concurrent with the closing of the Merger on March 21, 2024, we completed a private placement (the “March 2024 PIPE Financing”) of 3,559,565 shares of common stock for an aggregate gross purchase price of $53.5 million. Additionally, on July 17, 2024, we completed a private placement (the “July 2024 PIPE Financing”) with Ridgeback Capital Investments, L.P. of 1,578,947 shares of common stock for an aggregate gross purchase price of $30.0 million. As of December 31, 2025, we have sold an aggregate of 3,618,634 shares of common stock under the sales agreement with TD Securities (USA) LLC (the “Sales Agreement”), resulting in net proceeds to the Company of $147.7 million. As of December 31, 2025, the Company had no remaining capacity under the Sales Agreement.

Previous wording

In April 2022, we entered into a License and Collaboration Agreement with CORXEL Pharmaceuticals (formerly known as Ji Xing Pharmaceuticals Hong Kong Limited) (“CORXEL”) granting CORXEL an exclusive license (the “CORXEL License” formerly referred to as the “Ji Xing License”) to certain of our intellectual property rights to develop, use, import, and sell products containing LNZ100 (“Products”) for use in the treatment of presbyopia in humans in mainland China, Hong Kong Special Administrative Region, Macau Special Administrative Region, and Taiwan (collectively, “Greater

Current wording

In April 2022, we entered into a License and Collaboration Agreement with CORXEL Pharmaceuticals (formerly known as Ji Xing Pharmaceuticals Hong Kong Limited) (“CORXEL”) granting CORXEL an exclusive license (the “CORXEL License” formerly referred to as the “Ji Xing License”) to certain of our intellectual property rights to develop, use, import, and sell products containing LNZ100 (commercially known as VIZZ in the U.S.) (“Products”) for use in the treatment of presbyopia in humans in mainland China, Hong Kong Special Administrative Region, Macau Special Administrative Region, and Taiwan (collectively, “Greater China”). We also granted CORXEL (i) the right to negotiate in good faith and enter into agreements to purchase Products from us for clinical and commercial uses at cost plus a negotiated percentage and (ii) the right of first negotiation to obtain a regional license from us on other products we might develop outside of the field of presbyopia for commercialization in Greater China.

Previous wording

We received nonrefundable, non-creditable upfront payments totaling $15.0 million as initial consideration under the CORXEL License during the year ended December 31, 2022. In addition, we are also eligible to receive (i) up to $95.0 million in regulatory and sales milestone payments, (ii) tiered, escalating royalties in the range of 5% to 15% on net sales of Products in Greater China by CORXEL, its affiliates and sublicensees, and (iii) tiered, deescalating royalties in the range of 15% to 5% of sublicensing income received by CORXEL prior to the regulatory approval of the first Product in Greater China.

Current wording

We received nonrefundable, non-creditable upfront payments totaling $15.0 million as initial consideration under the CORXEL License during the year ended December 31, 2022. In addition, we received $5.0 million upon submission of the New Drug Application (“NDA”) for VIZZ to the National Medical Products Administration (“NMPA”) in Greater China for the treatment of presbyopia and another $5.0 million upon FDA approval of VIZZ during the year ended December 31, 2025. We are also eligible to receive (i) up to an additional $85.0 million in regulatory and sales milestone payments, (ii) tiered, escalating royalties in the range of 5% to 15% on net sales of Products in Greater China by CORXEL, its affiliates and sublicensees, and (iii) tiered, deescalating royalties in the range of 15% to 5% of sublicensing income received by CORXEL prior to the regulatory approval of the first Product in Greater China.

Previous wording

The $15.0 million upfront payments allocated to that single performance obligation was recognized on execution of the CORXEL License during the year ended December 31, 2022. No contractual milestones were met under the CORXEL License during the years ended December 31, 2024 or 2023.

Current wording

The $15.0 million upfront payments allocated to that single performance obligation was recognized on execution of the CORXEL License during the year ended December 31, 2022. During the year ended December 31, 2025, the first regulatory milestone under the CORXEL License was achieved upon submission of the NDA for VIZZ to the NMPA. A second regulatory milestone under the CORXEL License was achieved upon FDA approval of VIZZ. We recognized revenue and received payment totaling $10.0 million for the achievement of both regulatory milestones during the year ended December 31, 2025. No other contractual milestones were met under the CORXEL License during the years ended December 31, 2025 or 2024.

Previous wording

On October 27, 2024, CORXEL and the Company announced positive topline data from the Phase 3 JX07001 clinical trial of LNZ100 in patients with presbyopia in China. In this China Phase 3 safety and efficacy trial, LNZ100 achieved the primary endpoint and key secondary endpoints, with statistically significant three-lines or greater improvement in Best Corrected Distance Visual Acuity (“BCDVA”) at near, without losing one-line or more in distance visual acuity.

Current wording

On October 27, 2024, CORXEL and the Company announced positive topline data from the Phase 3 JX07001 clinical trial of VIZZ in patients with presbyopia in China. In this China Phase 3 safety and efficacy trial, VIZZ achieved the primary endpoint and key secondary endpoints, with statistically significant three-lines or greater improvement in Best Corrected Distance Visual Acuity (“BCDVA”) at near, without losing one-line or more in distance visual acuity.

Previous wording

•We expect that selling, general and administrative expenses will continue to increase in 2025, relative to 2024, as we have built a cross-functional commercial team consisting of marketing and commercial operations and will continue to strategically build our sales and commercial infrastructure with capabilities designed to scale when necessary to support a potential commercial launch of LNZ100, subject to FDA approval. These expenses increased during the year ended December 31, 2024, as compared to the year ended December 31, 2023, and we expect such expenses to continue to increase for the foreseeable future.

Current wording

•Our selling, general and administrative expenses increased in 2025, relative to 2024, as we have built a cross-functional commercial team consisting of marketing, commercial operations and an 88-territory sales force, and will continue to strategically support our sales and commercial infrastructure with capabilities designed to scale when necessary to support the commercialization of VIZZ. We expect such expenses to continue to increase for the foreseeable future due to the recent launch of our direct-to-consumer (“DTC”) marketing campaign and the expansion of our sales force.

Previous wording

Selling, general and administrative expenses consist primarily of salaries and related benefits, including share-based compensation, related to our executive, finance, business development, sales and marketing, human resources, and other corporate functions. Other selling, general and administrative expenses include marketing and advertising costs, professional fees for legal, tax and business consulting services, public company related expenses such as audit fees and insurance costs, intellectual property and patent costs, facility costs and travel costs.

Current wording

Selling, general and administrative expenses consist primarily of salaries and related benefits, including stock-based compensation, related to our executive, finance, business development, sales and marketing, human resources and other corporate functions. Other selling, general and administrative expenses include marketing and advertising costs to support our 88-territory sales force, professional fees for legal, tax and business consulting services, public company related expenses such as audit fees and insurance costs, intellectual property and patent costs, facility costs and travel costs. Subsequent to the FDA approval of VIZZ, selling, general and administrative expenses also include salaries and related benefits and stock-based compensation costs related to our quality assurance, regulatory, supply chain and operations, and medical affairs functions.

Previous wording

Research and development expenses, which consist primarily of costs associated with our product research and development efforts, are expensed as incurred. Research and development expenses consist primarily of: (i) employee related costs, including salaries, benefits and share-based compensation expense for employees engaged in research and development activities; (ii) third-party contract costs relating to research, formulation, manufacturing, nonclinical studies and clinical trial activities; (iii) external costs of outside consultants who assist with technology development, regulatory affairs, clinical development and quality assurance; and (iv) allocated facility-related costs.

Current wording

Research and development expenses, which consisted primarily of costs associated with our product research and development efforts, were expensed as incurred. Research and development expenses consisted primarily of: (i) employee related costs, including salaries, benefits and share-based compensation expense for employees engaged in research and development activities; (ii) third-party contract costs relating to research, formulation, manufacturing, nonclinical studies and clinical trial activities; (iii) external costs of outside consultants who assist with technology development, regulatory affairs, clinical development and quality assurance prior to FDA approval; and (iv) allocated facility-related costs.

Previous wording

Costs for certain activities, such as manufacturing, nonclinical studies and clinical trials are generally recognized based on the evaluation of the progress of completion of specific tasks using information and data provided by our vendors and collaborators. Research and development activities are central to our business.

Current wording

Costs for certain activities, such as nonclinical studies and clinical trials were generally recognized based on the evaluation of the progress of completion of specific tasks using information and data provided by our vendors and collaborators.

Previous wording

Other income (expense), net consists of the change in fair value of preferred stock warrants liability, interest income earned on cash, cash equivalents, and short-term investments, and changes in the fair value of long-term investments due to observable price changes in orderly transactions for an identical or similar investment. Upon completion of the Merger, the preferred stock warrants became exercisable into shares of common stock and will no longer continue to be remeasured at each reporting date.

Current wording

Other income, net consists of interest income earned on cash, cash equivalents, and short-term investments, changes in the fair value of long-term investments due to observable price changes in orderly transactions for an identical or similar investment, and the change in fair value of preferred stock warrants liability. Upon completion of the Merger, the preferred stock warrants became exercisable into shares of common stock and will no longer continue to be remeasured at each reporting date.

Previous wording

Selling, general and administrative expenses increased $15.9 million, or 123%, to $28.8 million for the year ended December 31, 2024 compared to $12.9 million for the year ended December 31, 2023. Increases in the comparative period included $6.7 million in employee salaries and related expenses due to a rise in headcount, and $6.4 million in pre-commercial marketing, advertising and sales infrastructure expenses as we prepare for a potential commercial launch of LNZ100, subject to FDA approval.

Current wording

Selling, general and administrative expenses increased $62.3 million, or 216%, to $91.1 million for the year ended December 31, 2025 compared to $28.8 million for the year ended December 31, 2024. Increases in the comparative period included $31.3 million in employee salaries and related expenses due to a rise in headcount, including the hiring of our 88-territory sales force, $20.5 million in pre-commercial and commercial marketing, advertising and sales infrastructure as we prepared for and executed the commercial launch of VIZZ and initiated the associated DTC marketing campaign, $3.9 million in chemistry and control and regulatory related expenses which were classified as selling, general and administrative expenses subsequent to FDA approval, $2.9 million in travel expenses primarily related to our sales force and $2.8 million in other corporate overhead.

Previous wording

Research and development expenses incurred for the year ended December 31, 2024 were primarily incurred to further refine the manufacturing process for LNZ100, while research and development expenses incurred for the year ended December 31, 2023 were substantially all related to the development of LNZ100 in our INSIGHT and CLARITY trials.

Current wording

Research and development expenses incurred for the year ended December 31, 2025 were primarily incurred to further refine the manufacturing process for VIZZ, while research and development expenses incurred for the year ended December 31, 2024 were substantially all related to the development of VIZZ in our INSIGHT and CLARITY trials.

Previous wording

Research and development expenses decreased $29.7 million, or 50%, to $29.8 million for the year ended December 31, 2024 compared to $59.5 million for the year ended December 31, 2023. The change was driven by decreases of $33.3 million in contract research expense for our clinical trials, as our Phase 3 CLARITY trials were substantially completed in March 2024, and $2.2 million in contract manufacturing expenses as we incurred higher shipping and labeling costs during the year ended December 31, 2023 to support our Phase 3 CLARITY trials, partially offset by increases of $3.0 million in employee salaries and related expenses due to increased non-clinical regulatory and CMC headcount, $1.8 million in contract regulatory consulting expenses associated with the preparation and filing of our NDA for LNZ100, and $0.5 million in nonclinical research expense.

Current wording

Research and development expenses decreased $11.1 million, or 37%, to $18.7 million for the year ended December 31, 2025 compared to $29.8 million for the year ended December 31, 2024. The decrease was primarily driven by a $12.1 million decrease in clinical and nonclinical research expense for our clinical trials, and a $2.4 million decrease in contract regulatory consulting expenses associated with the prior period preparation and filing of our NDA for VIZZ, and a $1.0 million decrease in employee salaries and related expenses. The decrease was partially offset by a $4.0 million increase in contingent product manufacturing costs incurred prior to FDA approval.

Previous wording

Other income, net for the year ended December 31, 2024, was $8.8 million, compared to $2.3 million for the year ended December 31, 2023. The increase was primarily driven by additional interest income earned on our cash, cash equivalents, and marketable securities of $6.4 million as a result of an overall increase in cash on-hand in 2024 over the comparative period, and an increase of $1.3 million in the fair value of the Company's equity investment without a readily determinable fair value, partially offset by a $1.2 million increase in the fair value of the preferred stock warrants liability, resulting in a non-recurring, non-cash charge at the close of the Merger.

Current wording

Other income, net for the year ended December 31, 2025, was $9.5 million, compared to $8.8 million for the year ended December 31, 2024. The increase was primarily driven by additional interest income earned on our cash, cash equivalents, and marketable securities of $1.2 million as a result of an overall increase in cash on-hand in 2025 over the comparative period. During the year ended December 31, 2024, we recorded a $1.0 million charge due to an increase in the fair value of the preferred stock warrants liability, resulting in a non-recurring, non-cash charge at the close of the Merger, and $1.3 million in other income related to an increase in the fair value of the Company's equity investment without a readily determinable fair value.

Previous wording

As of December 31, 2024, we had $209.1 million of cash, cash equivalents, restricted cash, and marketable securities. We have incurred net losses in each year since inception and as of December 31, 2024, we had an accumulated deficit of $145.0 million. Our net losses were $49.8 million and $70.0 million for the years ended December 31, 2024 and 2023, respectively. These losses have resulted principally from costs incurred in connection with research and development activities and selling, general and administrative costs associated with our operations. We expect to continue to incur significant expenses and operating losses as we seek approval and pursue the potential commercialization of LNZ100, if approved. These costs include expenses associated with the regulatory approval process for LNZ100, and the preparation for the potential commercial launch of our product, subject to FDA approval.

Current wording

As of December 31, 2025, we had $292.3 million of cash, cash equivalents, restricted cash, and marketable securities. We have incurred net losses in each year since inception and as of December 31, 2025, we had an accumulated deficit of $227.1 million. Our net losses were $82.1 million and $49.8 million for the years ended December 31, 2025 and 2024, respectively. These losses have resulted principally from costs incurred in connection with research and development activities and selling, general and administrative costs associated with our operations. We expect to continue to incur significant expenses and operating losses in the early stages of the commercialization of VIZZ, including costs related to product sales, marketing, manufacturing, and distribution.

Previous wording

We believe that our cash, cash equivalents, and marketable securities as of December 31, 2024 will allow us to continue to build infrastructure and commercialize LNZ100, subject to FDA approval, and such funds are anticipated to fund the Company to positive operating cash flow subsequent to such commercial launch. This belief is based on assumptions that may prove to be wrong, and we could use our available capital resources sooner than expected. Changing circumstances, some of which may be beyond our control, could cause us to consume capital significantly faster than currently anticipated, and we may need to seek additional funds sooner than planned.

Current wording

We believe that our cash, cash equivalents, and marketable securities as of December 31, 2025 will allow us to continue to build infrastructure and commercialize VIZZ, and such funds are anticipated to fund the Company to positive operating cash flow. This belief is based on assumptions that may prove to be wrong, and we could use our available capital resources sooner than expected. Changing circumstances, some of which may be beyond our control, could cause us to consume capital significantly faster than currently anticipated, and we may need to seek additional funds sooner than planned.

Previous wording

•costs associated with establishing a sales, marketing, and distribution infrastructure to commercialize LNZ100 if we obtain marketing approval;

Current wording

•costs associated with maintaining and expanding a sales, marketing, and distribution infrastructure to commercialize VIZZ;

Previous wording

•our ability to generate positive operating cash flow from sales of LNZ100 subsequent to commercial launch of LNZ100, if LNZ100 is approved;

Current wording

•our ability to generate positive operating cash flow from sales of VIZZ;

Previous wording

•the costs, timing, and outcome of regulatory review of LNZ100;

Current wording

•the costs, timing, and outcome of any additional regulatory review of VIZZ;

Previous wording

•our ability to achieve sufficient market acceptance and adequate market share and revenue for LNZ100, if approved; and

Current wording

•our ability to achieve sufficient market acceptance and adequate market share and revenue for VIZZ; and

Previous wording

Net cash used in operating activities primarily results from net loss adjusted for non-cash expenses, changes in working capital components, amounts due to contract research organizations to conduct our clinical programs, manufacturing of drug product and employee-related expenditures for research and development and selling, general and administrative activities. Cash flows from operating activities will continue to be impacted by spending to develop and pursue regulatory approval for LNZ100 and commercialization activities, if approval is obtained, and will also be impacted by any potential future revenue from commercialization activities. Cash flows will also continue to be affected by other operating and general administrative activities, including operating as a public company.

Current wording

Net cash used in operating activities primarily results from net loss adjusted for non-cash expenses, changes in working capital components, costs to manufacture VIZZ and employee-related expenditures. Cash flows from operating activities will continue to be impacted by commercialization activities for VIZZ, and will also be impacted by any potential future revenue from commercialization activities and licensing or distribution arrangements. Cash flows will also continue to be affected by other operating and general administrative activities.

Previous wording

For the year ended December 31, 2023, cash used in operating activities was $60.4 million primarily resulting from a net loss of $70.0 million and partially offset by a $8.6 million increase in accounts payable and accrued liabilities.

Current wording

For the year ended December 31, 2025, cash used in operating activities was $69.2 million and resulted from a net loss of $82.1 million, in addition to cash outflows of $3.0 million in prepaid expenses and other current assets primarily due to an increase in deposits related to our DTC marketing campaign, and $4.3 million from inventory purchases. The decrease in operating cash flows was offset by a $10.9 million increase in accounts payable and accrued liabilities due to the launch of our DTC marketing campaign, and $9.5 million in non-cash adjustments primarily driven by share-based compensation expense.

Previous wording

Cash used in investing activities for the year ended December 31, 2023 was $29.6 million, primarily due to $52.1 million of purchases of marketable securities, and partially offset by $22.5 million in proceeds from maturities of marketable securities.

Current wording

Cash used in investing activities for the year ended December 31, 2025 was $75.7 million, primarily due to $280.8 million of purchases of marketable securities, and partially offset by $206.0 million in proceeds from maturities of marketable securities.

Previous wording

We also have contracts with various organizations to conduct research and development activities, including clinical trial organizations to manage regulatory and any remaining clinical trial activities, and manufacturing companies to manufacture the drug product used in the regulatory process and clinical trials. The scope of the services under these research and development contracts can be modified and the contracts cancelled by us upon written notice. In the event of a cancellation, the company would be liable for the cost and expenses incurred to date as well as any close out costs of the service arrangement.

Current wording

We also have contracts with various suppliers and manufacturing companies to supply the active pharmaceutical ingredient used in VIZZ, and manufacture the drug product used in the regulatory process and clinical trials. The scope of the services under these contracts can be modified and the contracts cancelled by us upon written notice. In the event of a cancellation, the company would be liable for the cost and expenses incurred to date as well as any close out costs of the service arrangement.

Previous wording

Stock-based compensation expense represents the cost of the grant date fair value of equity awards recognized over the requisite service period of the awards (usually the vesting period) on a straight-line basis. We estimate the fair value of equity awards using the Black-Scholes option pricing model and recognize forfeitures as they occur. Estimating the fair value of equity awards as of the grant date using valuation models, such as the Black-Scholes option pricing model, is affected by assumptions regarding a number of variables, including the risk-free interest rate, the expected stock price volatility, the expected term of stock options, the expected dividend yield and the fair value of the underlying common stock on the date of grant. Changes in the assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. We determine the inputs and assumptions to the Black-Scholes option pricing model in the following manner:

Current wording

Share-based compensation expense represents the cost of the grant date fair value of equity awards recognized over the requisite service period of the awards (usually the vesting period) on a straight-line basis. We estimate the fair value of equity awards using the Black-Scholes option pricing model and recognize forfeitures as they occur. Estimating the fair value of equity awards as of the grant date using valuation models, such as the Black-Scholes option pricing model, is affected by assumptions regarding a number of variables, including the risk-free interest rate, the expected stock price volatility, the expected term of stock options, the expected dividend yield and the fair value of the underlying common stock on the date of grant. Changes in the assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. We determine the inputs and assumptions to the Black-Scholes option pricing model in the following manner:

Previous wording

Fair Value of Common Stock—Prior to the Merger, since there was no public market for our common stock, our board of directors, with input from management, determined the fair value of our common stock on each grant date by considering a number of objective and subjective factors, including input from management and valuations of our common stock by a third-party valuation firm. Following the Merger, the fair market value of our common stock is based on its closing price as reported on the date of grant on the primary stock exchange on which our common stock is traded, adjusted for special dividends, if any.

Current wording

Fair Value of Common Stock—The fair market value of our common stock is based on its closing price as reported on the date of grant on the primary stock exchange on which our common stock is traded, adjusted for special dividends, if any.

Previous wording

Risk-Free Interest Rate—The risk-free interest rate is based on a United States Treasury instrument whose term is consistent with the expected term of the stock options.

Current wording

Risk-Free Interest Rate—The risk-free interest rate is based on a U.S. Treasury instrument whose term is consistent with the expected term of the stock options.