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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)



x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2020



o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-34703

Alimera Sciences, Inc.

(Exact name of registrant as specified in its charter)



Delaware		20-0028718
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)



6120 Windward Parkway, Suite 290 Alpharetta, GA		30005
(Address of principal executive offices)		(Zip Code)

(678) 990-5740

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value per share	ALIM	The Nasdaq Stock Market LLC (Nasdaq Global Market)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.



Large accelerated filer	o	Accelerated filer	x

Non-accelerated filer	o	Smaller reporting company	x

		Emerging growth company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

As of May 4, 2020, there were 5,031,745 shares of the registrant’s Common Stock issued and outstanding.

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ALIMERA SCIENCES, INC.

QUARTERLY REPORT ON FORM 10-Q

INDEX



PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)	5
Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019	5
Condensed Consolidated Statements of Operations for the three months ended March 31, 2020 and 2019	6
Condensed Consolidated Statements of Comprehensive Loss for the three months ended March 31, 2020 and 2019	7
Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2020 and 2019	8
Condensed Consolidated Statements of Changes in Stockholders’ (Deficit) Equity	9
Notes to Condensed Consolidated Financial Statements	10
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3. Quantitative and Qualitative Disclosures about Market Risk	31
Item 4. Controls and Procedures	32
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	33
Item 1A. Risk Factors	33
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3. Defaults Upon Senior Securities	34
Item 4. Mine Safety Disclosures	34
Item 5. Other Information	34
Item 6. Exhibits	35
Signatures	36

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS AND PROJECTIONS

Various statements in this report of Alimera Sciences, Inc. (we, our, Alimera or the Company) are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve substantial risks and uncertainties. All statements, other than statements of historical facts, included in this report regarding our strategy, future operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management are forward-looking statements. These statements are subject to risks and uncertainties and are based on information currently available to our management. Words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “contemplates,” “predict,” “project,” “target,” “likely,” “potential,” “continue,” “ongoing,” “will,” “would,” “should,” “could,” or the negative of these terms and similar expressions or words, identify forward-looking statements. The events and circumstances reflected in our forward-looking statements may not occur and actual results could differ materially from those projected in our forward-looking statements. Meaningful factors that could cause actual results to differ include:


•	the adverse effects of COVID-19, and its unpredictable duration, in the regions where we have customers, employees and distributors;

•

the adverse effects of COVID-19 on sales of ILUVIEN^® resulting from (a) limitations on in-person access to physicians for treatment imposed by governments or healthcare facilities and (b) the unwillingness of patients, many of whom suffer from diabetic macular edema and, in Europe and the Middle East, non-infectious uveitis, to visit their physicians in person due to their fear of contracting COVID-19;


•	the possibility that we may fail to plan appropriately to meet the demand of our customers for ILUVIEN, which could lead either to (a) ILUVIEN being out of stock or (b) our investment of a greater amount of cash in inventory than we need;


•	the possibility that the economic impact of COVID-19 will lead to changes in reimbursement policies and reduce market access for ILUVIEN in countries where we sell ILUVIEN;


•	the possibility that we may fail to maintain or modify as necessary our internal controls over financial reporting in the new environment in which (a) almost all of our employees are working remotely and (b) we or our distributors are required to modify our standard business processes to take into account the current environment in light of COVID-19;


•	the possibility of reduced efficiency and potential distractions of our employees working remotely, and the resulting loss of productivity;


•	the possibility that we may fail to comply with minimum required revenue and liquidity covenants in our $45.0 million loan and security agreement with Solar Capital Ltd.;


•	uncertainty associated with our need to replace our key third-party manufacturer of certain component parts of the ILUVIEN injector before our manufacturing contract with the manufacturer expires on September 30, 2020;


•	dependence on third-party manufacturers to manufacture ILUVIEN or any future products or product candidates in sufficient quantities and quality, in a timely manner, and at an acceptable price;

•

financial uncertainty associated with the adverse effects of COVID-19 and the duration of those effects, which has had a material adverse effect on our revenue and may in the future have a material adverse effect on our financial condition and cash flows as well as an impact in future periods on certain estimates used in the preparation of our quarterly financial results, including impairment of intangible assets, the income tax provision and recoverability of certain receivables;


•	a slowdown or reduction in our sales in due, in addition to the other factors cited above, to a reduction in end user demand, unanticipated competition, regulatory issues, or other unexpected circumstances;


•	uncertainty regarding our ability to achieve profitability and positive cash flow through the commercialization of ILUVIEN in the U.S., the European Economic Area and other regions of the world where we sell ILUVIEN;

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•	uncertainty regarding the pricing and reimbursement guidelines for ILUVIEN or any future products or product candidates, including ILUVIEN in new markets;


•	uncertainty associated with our pursuit of reimbursement approval from local health authorities in certain countries for the recently obtained additional indication for ILUVIEN for prevention of relapse in recurrent non-infectious uveitis affecting the posterior segment of the eye (NIU-PS);


•	uncertainty associated with our ability to meet any post-market requirements for NIU-PS in the European Economic Area;


•	our ability to retain and recruit appropriate employees, in particular a productive sales force;


•	the possibility that we may fail to comply with the Nasdaq listing standards in the future;


•	our ability to successfully commercialize ILUVIEN following regulatory approval in additional markets;


•	delay in or failure to obtain regulatory and reimbursement approval of ILUVIEN or any future products or product candidates in additional countries;


•	our possible need to raise additional financing; and


•	current and future laws and regulations.

All written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We caution investors not to rely too heavily on the forward-looking statements we make or that are made on our behalf. We undertake no obligation and specifically decline any obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Please see, however, any further disclosures we make on related subjects in any annual, quarterly or current reports that we may file with the Securities and Exchange Commission (SEC).

We encourage you to read the discussion and analysis of our financial condition and our condensed consolidated financial statements contained in this report. We also encourage you to read Item 1A of Part II of this Quarterly Report on Form 10-Q, entitled “Risk Factors,” and Item 1A of Part I of our Annual Report on Form 10-K for the fiscal year ended December 31, 2019, which contains a more detailed discussion of some of the risks and uncertainties associated with our business. In addition to the risks described above, other unknown or unpredictable factors also could affect our results. There can be no assurance that we will in fact achieve the actual results or developments we anticipate or, even if we do substantially realize them, that they will have the expected consequences to, or effects on, us. Therefore, we can give no assurances that we will achieve the outcomes stated in those forward-looking statements and estimates.

Unless the context otherwise requires, throughout this Quarterly Report on Form 10-Q, the words “Alimera” “we,” “us,” the “registrant” or the “Company” refer to Alimera Sciences, Inc. and its subsidiaries (as applicable).

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PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements (unaudited)

ALIMERA SCIENCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS



	March 31, 2020			December 31, 2019
	(In thousands, except share and per share data)
CURRENT ASSETS:
Cash and cash equivalents	$	12,242		$	9,426
Restricted cash	31			33
Accounts receivable, net	16,179			19,331
Prepaid expenses and other current assets	2,497			2,565
Inventory (Note 7)	1,196			1,390
Total current assets	32,145			32,745
NON-CURRENT ASSETS:
Property and equipment, net	867			940
Right of use assets, net	967			1,107
Intangible asset, net (Note 8)	14,299			14,783
Deferred tax asset	720			734
TOTAL ASSETS	$	48,998		$	50,309
CURRENT LIABILITIES:
Accounts payable	$	5,833		$	7,077
Accrued expenses	3,045			4,716
Finance lease obligations	243			255
Total current liabilities	9,121			12,048
NON-CURRENT LIABILITIES:
Note payable, net of discount (Note 10)	41,395			38,658
Finance lease obligations — less current portion	97			94
Other non-current liabilities	3,789			3,954
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ (DEFICIT) EQUITY:
Preferred stock, $.01 par value — 10,000,000 shares authorized at March 31, 2020 and December 31, 2019:
Series A Convertible Preferred Stock, 1,300,000 authorized and 600,000 issued and outstanding at March 31, 2020 and December 31, 2019; liquidation preference of $24,000 at March 31, 2020 and December 31, 2019	19,227			19,227
Series C Convertible Preferred Stock, 10,150 authorized issued and outstanding at March 31, 2020 and December 31, 2019; liquidation preference of $10,150 at March 31, 2020 and December 31, 2019	11,117			11,117
Common stock, $.01 par value — 150,000,000 shares authorized, 5,028,882 shares issued and outstanding at March 31, 2020 and 4,965,949 shares issued and outstanding at December 31, 2019	50			50
Additional paid-in capital	350,442			350,117
Common stock warrants	3,707			3,707
Accumulated deficit	(388,768		)	(387,570		)
Accumulated other comprehensive loss	(1,179		)	(1,093		)
TOTAL STOCKHOLDERS’ (DEFICIT) EQUITY	(5,404		)	(4,445		)
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY	$	48,998		$	50,309

See Notes to Condensed Consolidated Financial Statements.

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ALIMERA SCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS



	Three Months Ended March 31,
	2020			2019
	(In thousands, except share and per share data)
NET REVENUE	$	14,535		$	12,890
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION	(1,927		)	(1,600		)
GROSS PROFIT	12,608			11,290

RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES	2,883			2,727
GENERAL AND ADMINISTRATIVE EXPENSES	3,181			3,393
SALES AND MARKETING EXPENSES	5,672			5,913
DEPRECIATION AND AMORTIZATION	654			652
OPERATING EXPENSES	12,390			12,685
NET INCOME (LOSS) FROM OPERATIONS	218			(1,395		)

INTEREST EXPENSE AND OTHER	(1,292		)	(1,228		)
UNREALIZED FOREIGN CURRENCY LOSS, NET	(81		)	(69		)
NET LOSS BEFORE TAXES	(1,155		)	(2,692		)
PROVISION FOR TAXES	(43		)	(71		)
NET LOSS	(1,198		)	(2,763		)
NET LOSS PER COMMON SHARE — Basic and diluted	$	(0.24	)	$	(0.59	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING — Basic and diluted	4,980,722			4,716,054

See Notes to Condensed Consolidated Financial Statements.

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ALIMERA SCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS



	Three Months Ended March 31,
	2020			2019
	(In thousands)
NET LOSS	$	(1,198	)	$	(2,763	)

OTHER COMPREHENSIVE LOSS
Foreign currency translation adjustments	(86		)	(83		)
TOTAL OTHER COMPREHENSIVE LOSS	(86		)	(83		)
COMPREHENSIVE LOSS	$	(1,284	)	$	(2,846	)

See Notes to Condensed Consolidated Financial Statements.

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ALIMERA SCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS



	Three Months Ended March 31,
	2020			2019
	(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(1,198	)	$	(2,763	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	654			652
Unrealized foreign currency transaction loss	81			69
Amortization of debt discount	239			206
Stock-based compensation expense	440			770
Changes in assets and liabilities:
Accounts receivable	3,036			1,755
Prepaid expenses and other current assets	54			(381		)
Inventory	177			532
Accounts payable	(1,154		)	301
Accrued expenses and other current liabilities	(1,627		)	(857		)
Other long-term liabilities	(154		)	—
Net cash provided by operating activities	548			284
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(25		)	(15		)
Net cash used in investing activities	(25		)	(15		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of debt	2,500			—
Payment of debt costs	(3		)	—
Payment of finance lease obligations	(82		)	(110		)
Net cash provided by (used in) financing activities	2,415			(110		)
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS AND RESTRICTED CASH	(124		)	(107		)
NET CHANGE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH	2,814			52
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH — Beginning of period	9,459			13,075
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH — End of period	$	12,273		$	13,127
SUPPLEMENTAL DISCLOSURES:
Cash paid for interest	$	1,007		$	1,012
Cash paid for income taxes	$	30		$	4
Supplemental schedule of non-cash investing and financing activities:
Property and equipment acquired under finance leases	$	74		$	64

See Notes to Condensed Consolidated Financial Statements.

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ALIMERA SCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ (DEFICIT) EQUITY



	Common Stock			Series A Convertible Preferred Stock			Series C Convertible Preferred Stock			Additional Paid-In Capital			Common Stock Warrants		Accumulated Deficit			Accumulated Other Comprehensive Loss			Total
	Shares	Amount		Shares	Amount		Shares	Amount		Additional Paid-In Capital			Common Stock Warrants		Accumulated Deficit			Accumulated Other Comprehensive Loss			Total
2020	(In thousands, except share data)
Balance, December 31, 2019	4,965,949	$	50	600,000	$	19,227	10,150	$	11,117	$	350,117		$	3,707	$	(387,570	)	$	(1,093	)	$	(4,445	)
Issuance of common stock, net of issuance costs	62,933	—		—	—		—	—		—			—		—			—			—
Stock-based compensation	—	—		—	—		—	—		440			—		—			—			440
Other	—	—		—	—		—	—		(115		)	—		—			—			(115		)
Net loss	—	—		—	—		—	—		—			—		(1,198		)	—			(1,198		)
Foreign currency translation adjustments	—	—		—	—		—	—		—			—		—			(86		)	(86		)
Balance, March 31, 2020	5,028,882	$	50	600,000	$	19,227	10,150	$	11,117	$	350,442		$	3,707	$	(388,768	)	$	(1,179	)	$	(5,404	)

2019
Balance, December 31, 2018	4,671,921	$	47	600,000	$	19,227	10,150	$	11,117	$	346,762		$	3,707	$	(377,127	)	$	(1,011	)	2,722
Issuance of common stock, net of issuance costs	59,319	—		—	—		—	—		—			—		—			—			—
Stock-based compensation	—	—		—	—		—	—		770			—		—			—			770
Net loss	—	—		—	—		—	—		—			—		(2,763		)	—			(2,763		)
Foreign currency translation adjustments	—	—		—	—		—	—		—			—		—			(83		)	(83		)
Balance, March 31, 2019	4,731,240	$	47	600,000	$	19,227	10,150	$	11,117	$	347,532		$	3,707	$	(379,890	)	$	(1,094	)	$	646

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ALIMERA SCIENCES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


1.	NATURE OF OPERATIONS

Alimera Sciences, Inc., together with its wholly owned subsidiaries (the Company), is a pharmaceutical company that specializes in the commercialization and development of ophthalmic pharmaceuticals. The Company’s only product is ILUVIEN^®, which has received marketing authorization and reimbursement approval in numerous countries for the treatment of diabetic macular edema (DME). In the U.S. and certain other countries outside Europe, ILUVIEN is indicated for the treatment of DME in patients who have been previously treated with a course of corticosteroids and did not have a clinically significant rise in intraocular pressure. In 17 countries in Europe, ILUVIEN is indicated for the treatment of vision impairment associated with chronic DME considered insufficiently responsive to available therapies. ILUVIEN is also indicated in 16 countries in Europe for prevention of relapse in recurrent non-infectious uveitis affecting the posterior segment of the eye (NIU-PS).

The Company markets ILUVIEN directly in the U.S., Germany, the U.K., Portugal, Austria and Ireland. In addition, the Company has entered into various agreements under which distributors are providing or will provide regulatory, reimbursement and sales and marketing support for ILUVIEN in Belgium, France, Italy, Luxembourg, the Netherlands, Spain, Australia, New Zealand, Canada and several countries in the Middle East. As of March 31, 2020, the Company has recognized sales of ILUVIEN to the Company’s international distributors in the Middle East, France, Italy and Spain.

2. BASIS OF PRESENTATION

The Company has prepared the accompanying unaudited interim condensed consolidated financial statements and notes thereto (Interim Financial Statements) in accordance with accounting principles generally accepted in the U.S. (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Article 8-03 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, these Interim Financial Statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of the Company’s management, the accompanying Interim Financial Statements reflect all adjustments, which include normal recurring adjustments, necessary to present fairly the Company’s interim financial information.

The accompanying Interim Financial Statements and related notes should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2019 and related notes included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on March 2, 2020. The financial results for any interim period are not necessarily indicative of the expected financial results for the full year.

Effects of the COVID-19 Pandemic

The public health crisis caused by the COVID-19 pandemic and the measures being taken by governments, businesses, and the public at large to limit COVID-19’s spread have had, and the Company expects will continue to have, certain negative effects on, and present certain risks to, the Company’s business. The Company is currently unable to fully determine its future impact on the Company’s business. These limitations and other effects of COVID-19 had a material adverse impact on the Company’s revenues late in the first quarter of 2020 and in the month of April 2020. The Company expects these factors to continue to adversely impact the Company’s revenue, but the extent and duration of that impact is uncertain at this time. The Company is monitoring the pandemic and its potential effect on the Company’s financial position, results of operations and cash flows. This uncertainty could have an impact in future periods on certain estimates used in the preparation of the Company’s quarterly financial results, including impairment of intangible assets, the income tax provision and realizability of certain receivables. Should the pandemic continue for an extended period of time, the impact on the Company’s operations could have a material adverse effect on the Company’s revenue, financial condition and cash flows.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company’s accounting policies followed for quarterly financial reporting are the same as those disclosed in the Notes to Financial Statements included in the Company’s Annual Report on Form 10-K filed with the SEC for the year ended December 31, 2019.

Reverse Stock Split

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ALIMERA SCIENCES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

common stock issued and outstanding were converted into one share of common stock. The Company paid cash in lieu of fractional shares, and accordingly, no fractional shares were issued in connection with the reverse split.

The reverse split did not change the par value of the common stock or the authorized number of shares of common stock. All outstanding options, preferred stock, restricted stock units, warrants and other securities entitling their holders to purchase or otherwise receive shares of Alimera’s common stock have been adjusted as a result of the reverse split, as required by the terms of each security. The number of shares available to be awarded under the 2019 Omnibus Incentive Plan and the number of shares that are purchasable under the 2010 Employee Stock Purchase Plan have also been appropriately adjusted.

Accounting Standards Issued but Not Yet Effective

In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-13, Financial Instruments - Credit Losses (Accounting Standards Codification (ASC 326)): Measurement of Credit Losses on Financial Instruments. This ASU replaces the current incurred loss impairment methodology for financial assets measured at amortized cost with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information, including forecasted information, to develop credit loss estimates. The standard becomes effective for the Company on January 1, 2023. The Company does not anticipate the adoption of this ASU will have a material impact on its financial statements.

4. REVENUE RECOGNITION

Net Revenue

The Company sells its products to major pharmaceutical distributors, pharmacies, hospitals and wholesalers (collectively, its Customers). In addition to distribution agreements with Customers, the Company enters into arrangements with healthcare providers and payors that provide for government-mandated and/or privately-negotiated rebates, chargebacks, and discounts with respect to the purchase of the Company’s products. All of the Company’s current contracts have a single performance obligation, as the promise to transfer the individual goods is not separately identifiable from other promises in the contracts and is, therefore, not distinct.

All of the Company’s revenue is derived from product sales. The Company recognizes revenues from product sales at a point in time when the Customer obtains control, typically upon delivery. The Company accrues for fulfillment costs when the related revenue is recognized. Taxes collected from Customers relating to product sales and remitted to governmental authorities are excluded from revenues.

As of March 31, 2020, the Company had received a total of $1,000,000 of milestone payments in connection with the Company’s Canadian distributor that it has not recognized as revenue based on the Company’s analysis in connection with ASU 2014-09, Revenue from Contracts with Customers (ASC 606). These deferred revenues are included as a component of other non-current liabilities on the Company’s balance sheets.

Estimates of Variable Consideration

Revenues from product sales are recorded at the net sales price (transaction price), which includes estimates of variable consideration for reserves related to statutory rebates to State Medicaid and other government agencies; commercial rebates and fees to Managed Care Organizations (MCOs), Group Purchasing Organizations (GPOs), distributors, and specialty pharmacies; product returns; sales discounts (including trade discounts); distributor costs; wholesaler chargebacks; and allowances for patient assistance programs relating to the Company’s sales of its products.

These reserves are based on estimates of the amounts earned or to be claimed on the related sales. Management’s estimates take into consideration historical experience, current contractual and statutory requirements, specific known market events and trends, industry data, and Customer buying and payment patterns. Overall, these reserves reflect the Company’s best estimates of the amount of consideration to which it is entitled based on the terms of the contract. The amount of variable consideration included in the net sales price is limited to the amount that is probable not to result in a significant reversal in the amount of the cumulative revenue recognized in a future period. If actual results vary, the Company may adjust these estimates, which could have an effect on earnings in the period of adjustment.

With respect to the Company’s international contracts with third party distributors, certain contracts have elements of variable consideration, and management reviews those contracts on a regular basis and makes estimates of revenue based on historical ordering patterns and known market events and data. The amount of variable consideration included in net sales in each period could vary depending on the terms of these contracts and the probability of reversal in future periods.

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ALIMERA SCIENCES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Consideration Payable to Customers

Distribution service fees are payments issued to distributors for compliance with various contractually-defined inventory management practices or services provided to support patient access to a product. Distribution service fees reserves are based on the terms of each individual contract and are classified within accrued expenses and are recorded as a reduction of revenue.

Product Returns

The Company’s policies provide for product returns in the following circumstances: (a) expiration of shelf life on certain products; (b) product damaged while in the Customer’s possession; and (c) following product recalls. Generally, returns for expired product are accepted three months before and up to one year after the expiration date of the related product, and the related product is destroyed after it is returned. The Company may either refund the sales price paid by the Customer by issuing a credit or exchanging the returned product for replacement inventory. The Company typically does not provide cash refunds. The Company estimates the proportion of recorded revenue that will result in a return by considering relevant factors, including historical returns experience, the estimated level of inventory in the distribution channel, the shelf life of products and product recalls, if any.

The estimation process for product returns involves, in each case, several interrelating assumptions, which vary for each Customer. The Company estimates the amount of its product sales that may be returned by its Customers and records this estimate as a reduction of revenue from product sales in the period the related revenue is recognized, and because this returned product cannot be resold, there is no corresponding asset for product returns. To date, product returns have been minimal.

Other Revenue

The Company enters into agreements in which it licenses certain rights to its products to partner companies that act as distributors. The terms of these arrangements may include payment to the Company of one or more of the following: non-refundable, up-front license fees; development, regulatory and commercial milestone payments; payments for manufacturing supply services the Company provides; and a revenue share on net sales of licensed products. Each of these payments is recognized as other revenues.

As part of the accounting for these arrangements, the Company must develop estimates that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. Performance obligations are promises in a contract to transfer a distinct good or service to the Customer, and the Company recognizes revenue when, or as, performance obligations are satisfied. The Company uses key assumptions to determine the stand-alone selling price; these assumptions may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical, regulatory and commercial success.

Certain of these agreements include consideration in the form of milestone payments. At the inception of each arrangement that includes milestone payments, the Company evaluates the recognition of milestone payments. Typically, milestone payments are associated with events that are not entirely within the control of the Company or the licensee, such as regulatory approvals; are included in the transaction price; and are subject to a constraint until it is probable that there will not be a significant revenue reversal, typically upon achievement of the milestone. At the end of each reporting period, the Company re-evaluates the probability of achievement of such milestones and any related constraint, and if necessary, adjusts its estimate of the overall transaction price.

Customer Payment Obligations

The Company receives payments from its Customers based on billing schedules established in each contract, which vary across the Company’s locations, but generally range between 30 to 120 days. Occasionally, the timing of receipt of payment for the Company’s international Customers can be extended. Amounts are recorded as accounts receivable when the Company’s right to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation is that the Customer will pay for the product or services in one year or less of receiving those products or services.

5. LEASES

The Company evaluates all of its contracts to determine whether it is or contains a lease at inception. The Company reviews its contracts for options to extend, terminate or purchase any right of use assets and accounts for these, as applicable, at inception of the contract. Lease renewal options are not recognized as part of the lease liability until the Company determines it is reasonably certain it will exercise any applicable renewal options. The Company has not recorded any liability for renewal

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options in these Interim Financial Statements. The useful lives of leased assets as well as leasehold improvements, if any, are limited by the expected lease term.

Operating Leases

The Company’s operating lease activities primarily consist of leases for office space in the U.S., the United Kingdom and Germany. Most of these leases include options to renew, with renewal terms generally ranging from one to seven years. The exercise of lease renewal options is at the Company’s sole discretion. Certain of the Company’s operating lease agreements include variable lease costs that are based on common area maintenance and property taxes. The Company expenses these payments as incurred. The Company’s operating lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Supplemental balance sheet information as of March 31, 2020 for the Company’s operating leases is as follows:



	(in thousands)
NON-CURRENT ASSETS:
Right of use assets, net	$	967
Total lease assets	$	967

CURRENT LIABILITIES:
Accrued expenses	$	473
NON-CURRENT LIABILITIES:
Other non-current liabilities	665
Total lease liabilities	$	1,138

The Company’s operating lease cost for the three months ended March 31, 2020 was $127,000 and is included in general and administrative expenses in its condensed consolidated statement of operations.

As of March 31, 2020, a schedule of maturity of lease liabilities under all of the Company’s operating leases is as follows:



Years Ending December 31	(In thousands)
2020	$	499
2021	451
2022	152
2023	152
2024	155
Thereafter	—
Total	1,409
Less amount representing interest	(271		)
Present value of minimum lease payments	1,138
Less current portion	(473		)
Non-current portion	$	665

Cash paid for operating leases was $102,000 during the three months ended March 31, 2020. No right of use assets were obtained in exchange for operating leases for the three months ended March 31, 2020.

As of March 31, 2020, the weighted average remaining lease terms of the Company’s operating leases was 3.3 years. The weighted average discount rate used to determine the lease liabilities was 10.1%.

Finance Leases

The Company’s finance lease activities primarily consist of leases for office equipment and automobiles. Property and equipment leases are capitalized at the lesser of fair market value or the present value of the minimum lease payments at the inception of the leases using the Company’s incremental borrowing rate. The Company’s finance lease agreements do not

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contain any material residual value guarantees or material restrictive covenants.

Supplemental balance sheet information as of March 31, 2020 and December 31, 2019 for the Company’s finance leases is as follows:



	March 31, 2020		December 31, 2019
	(In thousands)
NON-CURRENT ASSETS:
Property and equipment, net	$	406	$	414
Total lease assets	$	406	$	414

CURRENT LIABILITIES:
Finance lease obligations	$	243	$	255
NON-CURRENT LIABILITIES:
Finance lease obligations — less current portion	97		94
Total lease liabilities	$	340	$	349

Depreciation expense associated with property and equipment under finance leases was approximately $81,000 and $76,000 for the three months ended March 31, 2020 and 2019, respectively. Interest expense associated with finance leases was $7,000 and $9,000 for the three months ended March 31, 2020 and 2019, respectively.

As of March 31, 2020, a schedule of maturity of lease liabilities under finance leases, together with the present value of minimum lease payments, is as follows:



Years Ending December 31	(In thousands)
2020	238
2021	105
2022	20
2023	1
Total	364
Less amount representing interest	(24		)
Present value of minimum lease payments	340
Less current portion	(243		)
Non-current portion	$	97

Cash paid for finance leases was $82,000 during the three months ended March 31, 2020. The Company acquired $74,000 of property and equipment in exchange for finance leases during the three months ended March 31, 2020.

As of March 31, 2020, the weighted average remaining lease terms of the Company’s financing leases was 1.1 years. The weighted average discount rate used to determine the financing lease liabilities was 7.5%.

6. GOING CONCERN

The accompanying Interim Financial Statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Interim Financial Statements do not include any adjustments that might result from the outcome of this uncertainty.

To date, the Company has incurred recurring losses and negative cash flow from operations and has accumulated a deficit of $388,768,000 from inception through March 31, 2020. As of March 31, 2020, the Company had approximately $12,242,000 in cash and cash equivalents. The Company’s ability to avoid depleting its cash depends upon its ability to maintain revenue and contain its expenses. Should the impact of COVID-19 be extended, the Company has plans in place to reduce its expenses further in the future.

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Further, the Company must maintain compliance with the debt covenants of its $45,000,000 Loan and Security Agreement and First Amendment dated May 1, 2020 with Solar Capital Ltd. (see Note 10). In management’s opinion, the uncertainty regarding future revenues raises substantial doubt about the Company’s ability to continue as a going concern without access to additional debt and/or equity financing over the course of the next twelve months.

To meet the Company’s future working capital needs, the Company may need to raise additional debt or equity financing. While the Company has historically been able to raise additional capital through issuance of equity and/or debt financing, and while the Company has implemented a plan to control its expenses to satisfy its obligations due within one year from the date of issuance of these Interim Financial Statements, the Company cannot guarantee that it will be able to maintain debt compliance, raise additional equity, contain expenses, or increase revenue. Accordingly, there is substantial doubt about the Company’s ability to continue as a going concern within one year after these Interim Financial Statements are issued.

7. INVENTORY

Inventory consisted of the following:



	March 31, 2020		December 31, 2019
	(In thousands)
Component parts (1)	$	380	$	389
Work-in-process (2)	220		399
Finished goods	596		602
Total Inventory	$	1,196	$	1,390

(1) Component parts inventory consists of manufactured components of the ILUVIEN applicator.

(2) Work-in-process consists of completed units of ILUVIEN that are undergoing, but have not completed, quality assurance testing or stability testing as required by U.S. or EEA regulatory authorities.

8. INTANGIBLE ASSET

As a result of the approval of ILUVIEN by the U.S. Food and Drug Administration (FDA) in 2014, the Company was required to pay EyePoint a milestone payment of $25,000,000 (see Note 9).

The gross carrying amount of the intangible asset is $25,000,000, which is being amortized over approximately 13 years from the acquisition date. The amortization expense related to the intangible asset was approximately $484,000 and $478,000 for the three months ended March 31, 2020 and 2019, respectively. The net book value of the intangible asset was $14,299,000 and $14,783,000 as of March 31, 2020 and December 31, 2019, respectively.

The estimated future amortization expense as of March 31, 2020 for the remaining periods in the next five years and thereafter is as follows:



Years Ending December 31	(In thousands)
2020	$	1,462
2021	1,940
2022	1,940
2023	1,940
2024	1,946
Thereafter	5,071
Total	$	14,299

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to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. The assessment of the recoverability of assets will be impacted if estimated future operating cash flows are not achieved.

In April of 2020, as a result of the potential impact of COVID-19 on the Company’s statements of operations, the Company performed an asset impairment analysis by comparing future undiscounted cash flows of the identified asset group to the carrying value of that asset group. The Company concluded no impairment was necessary for the three months ended March 31, 2020.

9. LICENSE AGREEMENTS

EyePoint Agreement

In February 2005, the Company entered into an agreement with EyePoint (formerly known as pSivida US, Inc.) for the use of fluocinolone acetonide (FAc) in EyePoint’s proprietary insert technology. This agreement was subsequently amended a number of times (as amended, the EyePoint Agreement). The EyePoint Agreement provides the Company with a worldwide exclusive license to utilize certain underlying technology used in the development and commercialization of ILUVIEN.

In July 2017, the Company amended and restated its license agreement with EyePoint, which was made effective July 1, 2017 (the New Collaboration Agreement). Under the New Collaboration Agreement, the Company has the right to the technology underlying ILUVIEN for the treatment of uveitis, including NIU-PS, in Europe, the Middle East and Africa. The New Collaboration Agreement converted the Company’s previous profit share obligation to a royalty payable on global net revenues of ILUVIEN. The Company began paying a 2% royalty on net revenues and other related consideration to EyePoint on July 1, 2017. The royalty amount increased to 6% effective December 12, 2018. The Company is required to pay an additional 2% royalty on global net revenues and other related consideration in excess of $75,000,000 in any year. During the three months ended March 31, 2020 and 2019, the Company recognized approximately $581,000 and $516,000 of royalty expense, respectively, which is included in cost of goods sold, excluding depreciation and amortization. As of March 31, 2020, approximately $581,000 of this royalty expense was included in the Company’s accounts payable.

Following the signing of the New Collaboration Agreement, the Company retained a right to recover up to $15,000,000 of commercialization costs that were incurred prior to profitability of ILUVIEN and to offset a portion of future payments owed to EyePoint with these accumulated commercialization costs, referred to as the Future Offset. Due to the uncertainty of future net profits, the Company has fully reserved the Future Offset in the accompanying Interim Financial Statements. In March 2019, pursuant to the New Collaboration Agreement, the Company forgave $5,000,000 of the Future Offset in connection with the approval of ILUVIEN for NIU-PS in the U.K. As of March 31, 2020, the balance of the Future Offset was approximately $8,567,000.

10. LOAN AGREEMENTS

Hercules Loan Agreement

In April 2014, Alimera Sciences Limited (Alimera UK), a subsidiary of the Company, entered into a loan and security agreement (Hercules Loan Agreement) with Hercules Capital, Inc. (Hercules) providing for a term loan of up to $35,000,000 (Hercules Loan). The Company amended the Hercules Loan Agreement several times. On January 5, 2018, the Company paid off the Hercules Loan on behalf of Alimera UK, using the proceeds of the 2018 Solar Loan Agreement described below.

2014 Warrant

In connection with Alimera UK entering into the Hercules Loan Agreement, the Company issued a warrant that granted Hercules the right to purchase up to 19,002 shares of the Company’s common stock at an exercise price of $92.10 per share (the 2014 Warrant). The Company amended the 2014 Warrant a number of times to increase the number of shares issuable upon exercise to 83,933 and decrease the exercise price to $20.85 per share. The right to exercise this warrant expires on November 2, 2020.

2016 Warrant

In connection with Alimera UK entering into an amendment to the Hercules Loan Agreement on October 20, 2016, the Company agreed to issue a new warrant to Hercules (the 2016 Warrant) that granted Hercules the right to purchase up to 30,582 shares of the Company’s common stock at an exercise price of $16.35 per share. The right to exercise this warrant expires on October 20, 2021.

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Solar Capital Loan Agreement

On January 5, 2018, the Company entered into a $40,000,000 Loan and Security Agreement (the 2018 Solar Loan Agreement) with Solar Capital Ltd. (Solar Capital), as Collateral Agent (Agent), and the parties signing the 2018 Solar Loan Agreement from time to time as Lenders, including Solar Capital in its capacity as a Lender (collectively, the Lenders). Under the 2018 Solar Loan Agreement, the Company borrowed the entire $40,000,000 as a term loan (the 2018 Solar Loan) that was scheduled to mature on July 1, 2022. The Company paid Solar Capital a $400,000 fee at the closing of the 2018 Solar Loan Agreement. The Company repaid the 2018 Solar Loan on December 31, 2019 with a new loan agreement with Solar Capital as described below.

The Company used the proceeds of the 2018 Solar Loan to extinguish (prepay) the Hercules Loan Agreement and pay related expenses. The Company used the remaining loan proceeds to provide additional working capital for general corporate purposes.

Interest on the 2018 Solar Loan was payable at one-month LIBOR plus 7.65% per annum. The 2018 Solar Loan Agreement provided for interest only payments through the date of repayment. As of the final interest payment on the 2018 Solar Loan, the interest rate was approximately 9.3%.

The Company agreed, for itself and its subsidiaries, to customary affirmative and negative covenants and events of default in connection with the 2018 Solar Loan Agreement.

2018 Exit Fee Agreement

Notwithstanding the repayment of the 2018 Solar Loan, the Company remains obligated to pay additional fees under the Exit Fee Agreement (2018 Exit Fee Agreement) dated as of January 5, 2018 by and among the Company, Solar Capital as Agent, and the Lenders. The 2018 Exit Fee Agreement survived the termination of the 2018 Solar Loan Agreement upon the repayment of the 2018 Solar Loan and has a term of 10 years. The Company is obligated to pay up to, but no more than, $2,000,000 in fees under the 2018 Exit Fee Agreement.

2019 Solar Capital Loan Agreement

On December 31, 2019, the Company entered into a $45,000,000 Loan and Security Agreement (the 2019 Solar Loan Agreement) with Solar Capital, as Agent, and the parties signing the 2019 Solar Loan Agreement from time to time as Lenders, including Solar Capital in its capacity as a Lender (collectively, the Lenders). Under the 2019 Solar Loan Agreement, the Company borrowed $42,500,000 on December 31, 2019 and subsequent to December 31, 2019, the Company borrowed the remaining $2,500,000 on February 21, 2020 (the two borrowings totaling $45,000,000 are referred to as the 2019 Solar Loan). The 2019 Solar Loan matures on July 1, 2024.

As noted above, the Company used the initial proceeds of the 2019 Solar Loan to pay off the 2018 Solar Loan, along with related prepayment, legal and other fees and expenses of approximately $2,278,000, which included a $1.8 million fee to Solar Capital upon repayment of the 2018 Solar Loan that was previously accrued and a $400,000 prepayment fee to Solar Capital that was capitalized as deferred financing costs. The Company expects to use the remaining loan proceeds to provide additional working capital for general corporate purposes.

Interest on the 2019 Solar Loan is payable at the greater of (i) one-month LIBOR or (ii) 1.78%, plus 7.65% per annum. As of December 31, 2019, the 2019 Solar Loan’s interest rate is 9.43%. The 2019 Solar Loan provides for interest only payments until January 1, 2023. If the Company meets certain revenue thresholds and no event of default shall have occurred and is continuing, the Company can extend the interest only period an additional six months, ending on June 30, 2023, followed by one year of monthly payments of principal and interest.

The Company paid the Lenders a non-refundable facility fee in the amount of $25,000 on February 21, 2020. In addition, the Company is obligated to pay a $2,250,000 fee upon repayment of the 2019 Solar Loan.

First Amendment to 2019 Solar Capital Loan Agreement

On May 1, 2020, the Company entered into a First Amendment (the Amendment) to its 2019 Solar Loan Agreement with Solar Capital. The Amendment, among other things:

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course of business to third party customers, on a trailing six-month basis, to be less than a specified minimum revenue amount for each such date;

(b)requires that the Revenue Covenant be measured at November 30, 2020 and specifies a new minimum revenue amount in that regard;

(c)requires that the Revenue Covenant be measured at December 31, 2020 and specifies a new minimum revenue amount in that regard; and

(d)requires that the Revenue Covenant be measured at March 31, 2021 and at the last day of each quarter thereafter, with the minimum revenue amount equal to a percentage of the Company’s projected revenues in accordance with an annual plan submitted by the Company to Agent by January 15th of such year, such plan to be approved by the Company’s board of directors and Agent in its sole discretion.

The Amendment also adds the following new minimum liquidity requirement that is in effect from May 1, 2020 until the Company notifies Agent that it has met the Revenue Covenant at November 30, 2020: the Company shall not permit the aggregate amount of unrestricted cash and cash equivalents to be less than the sum of (i) $8,500,000 plus (ii) the amount of the Company’s accounts payable that have not been paid within 90 days from the invoice date of the relevant account payable. We paid no fees to Solar Capital; however, we agreed to reimburse Agent for its legal fees.

Modification of Debt

In accordance with the guidance in ASC 470-50, Debt, the Company entered into and accounted for the 2019 Solar Loan Agreement as a modification and capitalized approximately $427,000 of costs as additional deferred financing costs and expensed approximately $76,000 of costs incurred with third parties within the consolidated statements of operations for the year ended December 31, 2019.

Fair Value of Debt

The weighted average interest rates of the Company’s notes payable approximate the rate at which the Company could obtain alternative financing. Therefore, the carrying amount of the notes approximated their fair value at March 31, 2020 and December 31, 2019.

11. EARNINGS (LOSS) PER SHARE (EPS)

The Company follows ASC 260, Earnings Per Share (ASC 260), which requires the reporting of both basic and diluted earnings per share. Because the Company’s preferred stockholders participate in dividends equally with common stockholders (if the Company were to declare and pay dividends), the Company uses the two-class method to calculate EPS. However, the Company’s preferred stockholders are not contractually obligated to share in losses.

Basic EPS is computed by dividing net income (loss) available to stockholders by the weighted average number of shares outstanding for the period. Diluted EPS is calculated in accordance with ASC 260 by adjusting weighted average shares outstanding for the dilutive effect of common stock options, restricted stock units and warrants. In periods where a net loss is recorded, no effect is given to potentially dilutive securities, since the effect would be anti-dilutive.



	Three Months Ended March 31,
	2020	2019
Series A convertible preferred stock	601,504	601,504
Series C convertible preferred stock	676,667	676,667
Common stock warrants	119,712	119,712
Stock options	1,036,484	894,097
Restricted stock units	30,086	32,029
Total	2,464,453	2,324,009

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

12. STOCK INCENTIVE PLANS

Stock Option Plans

During the three months ended March 31, 2020 and 2019, the Company recorded compensation expense related to stock options of approximately $292,000 and $545,000, respectively. As of March 31, 2020, the total unrecognized compensation cost related to non-vested stock options granted was $2,200,000 and is expected to be recognized over a weighted average period of 2.63 years. The following table presents a summary of stock option activity for the three months ended March 31, 2020 and 2019:



	Three Months Ended March 31,
	2020			2019
	Options		Weighted Average Exercise Price ($)	Options		Weighted Average Exercise Price ($)
Options outstanding at beginning of period	871,472		35.46	830,100		39.41
Grants	168,850		6.75	78,324		13.10
Forfeitures	(3,838	)	20.99	(14,318	)	29.92
Exercises	—		—	—		—
Options outstanding at period end	1,036,484		30.84	894,106		37.25
Options exercisable at period end	707,763		40.00	636,028		45.22
Weighted average per share fair value of options granted during the period	$4.18			$8.21

The following table provides additional information related to outstanding stock options, exercisable stock options and stock options that were expected to vest as of March 31, 2020:



	Shares	Weighted Average Exercise Price ($)	Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value ($)
				(In thousands)
Outstanding	1,036,484	30.84	4.97 years	9
Exercisable	707,763	40.00	4.97 years	9
Outstanding, vested and expected to vest	989,943	31.83	6.12 years	99

The following table provides additional information related to outstanding stock options, exercisable stock options and stock options that were expected to vest as of December 31, 2019:



	Shares	Weighted Average Exercise Price ($)	Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value ($)
				(In thousands)
Outstanding	871,472	35.46	5.83 years	4,043
Exercisable	674,952	41.25	5.04 years	13
Outstanding, vested and expected to vest	849,285	36.00	5.75 years	3,324

As of March 31, 2020, 265,625 shares remain available for grant under the 2019 Omnibus Incentive Plan.

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Employee Stock Purchase Plan

During the three months ended March 31, 2020 and 2019, the Company recorded compensation expense related to its employee stock purchase plan of approximately $21,000 and $6,000, respectively.

Restricted Stock and Restricted Stock Units

A summary of restricted stock and restricted stock units (RSU) transactions under the plans are as follows:



	Three Months Ended March 31,
	2020			2019
	Restricted Stock & RSUs		Weighted Average Grant Date Fair Value ($)	Restricted Stock & RSUs		Weighted Average Grant Date Fair Value ($)
Restricted stock & RSUs outstanding at beginning of period	36,763		13.15	60,041		17.30
Grants	30,086		3.12	32,029		12.90
Vested units	(36,763	)	13.15	(59,341	)	17.30
Forfeitures	—		—	(700	)	17.40
Restricted stock & RSUs outstanding at period end	30,086		3.12	32,029		12.90

As of December 31, 2019, there was approximately $123,000 of total unrecognized compensation cost related to outstanding RSUs that was recognized during the first quarter of 2020. Employee stock-based compensation expense related to restricted stock and RSUs recognized in accordance with ASC 718, Compensation - Stock Compensation (ASC 718) was $127,000 and $219,000 for the three months ended March 31, 2020 and 2019, respectively.

13. INCOME TAXES

In accordance with ASC 740, Income Taxes, the Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of its assets and liabilities at the enacted tax rates in effect for the year in which the differences are expected to reverse. The Company records a valuation allowance against its net deferred tax asset to reduce the net carrying value to an amount that is more likely than not to be realized. At the end of each interim period, the Company makes its best estimate of the effective tax rate expected to be applicable for the full fiscal year. This estimate reflects, among other items, the Company’s best estimate of operating results and foreign currency exchange rates.

The Company also applies the provisions for income taxes related to, among other things, accounting for uncertain tax positions and disclosure requirements. The Company’s recorded liability for uncertain tax positions as of March 31, 2020 has increased by approximately $8,000 as compared to December 31, 2019. There has been no change to the Company’s policy that recognizes potential interest and penalties related to uncertain tax positions. The Company conducts business globally and, as a result, files income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. In the normal course of business, the Company is subject to examination by taxing authorities throughout the world.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (“CARES”) Act was enacted and signed into law. In addition to other provisions, the CARES Act contains modifications to Net Operating Loss (NOL) carryback rules. For the three months ended March 31, 2020, there was no impact to the tax provision related to the CARES Act. We are currently evaluating the provisions of the CARES Act and how other elections may impact our financial position, results of operations, and disclosures, if needed.

At December 31, 2019, the Company had U.S. federal NOL carry-forwards of approximately $125,756,000 and state NOL carry-forwards of approximately $172,993,000 available to reduce future taxable income. The Company’s U.S. federal NOL carry-forwards remain fully reserved as of March 31, 2020. Except for the NOLs generated after 2017, the U.S. federal NOLs not fully utilized will expire at various dates between 2029 and 2037; most state NOL carry-forwards will expire at various dates between 2020 and 2039. Under the Tax Cuts and Jobs Act of 2017, U.S. federal NOLs and some state NOLs generated after 2017 will carryforward indefinitely.

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Company anticipates that its foreign subsidiaries will be profitable and have earnings in the future. Once the foreign subsidiaries do have earnings, the Company intends to indefinitely reinvest in its foreign subsidiaries all undistributed earnings of and original investments in such subsidiaries. As a result, the Company has not recorded a deferred tax liability related to excess of book over tax basis in the stock of its foreign subsidiaries in accordance with ASC 740-30-25.

14. SEGMENT INFORMATION

During the three months ended March 31, 2020 and 2019, two customers within the U.S. segment that are large pharmaceutical distributors accounted for 49% and 52%, respectively, of the Company’s consolidated revenues. These same two customers within the U.S. segment accounted for approximately 65% and 68% of the Company’s consolidated accounts receivable at March 31, 2020 and at December 31, 2019, respectively.

The Company’s chief operating decision maker is the Chief Executive Officer (CEO). While the CEO is apprised of a variety of financial metrics and information, the business is principally managed and organized based upon geographic and regulatory environment. Each segment is separately managed and is evaluated primarily upon segment loss from operations. Non-cash items including stock-based compensation expense and depreciation and amortization are categorized as Other within the table below. The Company does not report balance sheet information by segment because the Company’s chief operating decision maker does not review that information.

The following table presents a summary of the Company’s reporting segments for the three months ended March 31, 2020 and 2019:



	Three Months Ended March 31, 2020												Three Months Ended March 31, 2019
	U.S.			International			Other			Consolidated			U.S.			International			Other			Consolidated
	(In thousands)
NET REVENUE	$	7,068		$	7,467		$	—		$	14,535		$	6,766		$	6,124		$	—		$	12,890
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION	(759		)	(1,168		)	—			(1,927		)	(685		)	(915		)	—			(1,600		)
GROSS PROFIT	6,309			6,299			—			12,608			6,081			5,209			—			11,290

RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES	1,922			893			68			2,883			1,427			1,170			130			2,727
GENERAL AND ADMINISTRATIVE EXPENSES	1,973			936			272			3,181			1,933			988			472			3,393
SALES AND MARKETING EXPENSES	4,280			1,292			100			5,672			4,041			1,705			167			5,913
DEPRECIATION AND AMORTIZATION	—			—			654			654			—			—			652			652
OPERATING EXPENSES	8,175			3,121			1,094			12,390			7,401			3,863			1,421			12,685
SEGMENT (LOSS) INCOME FROM OPERATIONS	(1,866		)	3,178			(1,094		)	218			(1,320		)	1,346			(1,421		)	(1,395		)
OTHER INCOME AND EXPENSES, NET	—			—			(1,373		)	(1,373		)	—			—			(1,297		)	(1,297		)
NET LOSS BEFORE TAXES										$	(1,155	)										$	(2,692	)

15. SUBSEQUENT EVENTS

$1.8 Million Loan under the Paycheck Protection Program

As we announced on April 23, 2020, the Company received on April 22, 2020 approximately $1.8 million in support in the form of a loan (the “PPP Loan”) from the U.S. federal government under the Paycheck Protection Program established as part of the Coronavirus Aid, Relief and Economic Security Act, or the CARES Act. The PPP Loan is unsecured and is evidenced by a note (the “Note”) in favor of HSBC Bank USA, National Association (“HSBC”) as the lender and is governed by a Loan Agreement with HSBC.

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as the Company uses the loan proceeds during the eight-week period after the loan origination for eligible purposes as described in the CARES Act and related guidance.

In connection with the PPP Loan, the Company entered into a Consent to Loan and Security Agreement (the “Consent”) under the 2019 Solar Loan Agreement. In the Consent, Solar Capital consented as Collateral Agent and a Lender, and the other Lenders consented as Lenders, to the indebtedness incurred under the PPP Loan, subject to certain conditions, including the Company’s covenant to comply with specified provisions of the CARES Act, the Company’s confirmation of the accuracy of its representations and warranties in the 2019 Solar Loan Agreement and related documents and a release in favor of the Collateral Agent and the Lenders.

German Withholding Tax

In April 2020, recent interpretations of a German law relating to withholding taxes on intellectual property rights have emerged. The Company is currently evaluating this law and any related impact to its financial position or results of operations.

First Amendment to 2019 Solar Capital Loan Agreement

On May 1, 2020, the Company entered into a First Amendment to its 2019 Solar Loan Agreement. (See Note 10 above for expanded disclosures.)

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ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

The following discussion and analysis should be read in conjunction with our unaudited interim condensed consolidated financial statements and the related notes that appear elsewhere in this quarterly report on Form 10-Q. This discussion contains forward-looking statements reflecting our current expectations that involve risks and uncertainties. Actual results may differ materially from those discussed in these forward-looking statements due to a number of factors, including those provided in the sections entitled “Risk Factors” in our most recent annual report on Form 10-K and in Part II, Item 1A of this report below. For further information regarding forward-looking statements, please refer to the “Special Note Regarding Forward-Looking Statements and Projections” immediately after the index to this report above.

Alimera Sciences, Inc., and its subsidiaries (we, our or us), is a pharmaceutical company that specializes in the commercialization and development of prescription ophthalmic pharmaceuticals. We presently focus on diseases affecting the back of the eye, or retina, because these diseases are not well treated with current therapies and affect millions of people globally. Our only product is ILUVIEN^®, which has received marketing authorization and reimbursement approval in numerous countries for the treatment of diabetic macular edema (DME). In addition, ILUVIEN has received marketing authorization and reimbursement approval in Germany and the U.K. for the prevention of relapse in recurrent non-infectious uveitis affecting the posterior segment (NIU-PS).

We market ILUVIEN directly in the U.S., Germany, the U.K., Portugal, Austria and Ireland. In addition, we have entered into various agreements under which distributors are providing or will provide regulatory, reimbursement and sales and marketing support for ILUVIEN in Belgium, France, Italy, Luxembourg, the Netherlands, Spain, Australia, New Zealand, Canada and several countries in the Middle East. As of March 31, 2020, we have recognized sales of ILUVIEN to our international distributors in the Middle East, France, Italy and Spain.

Effects of the COVID-19 Pandemic

The unprecedented and adverse effects of COVID-19, and its unpredictable duration, in the regions where we have customers, employees and distributors have had a material adverse effect on our sales of ILUVIEN and thus on our net revenues and may in the future have a material adverse effect on our liquidity and financial condition. These adverse effects of COVID-19 on us have resulted from the following, among other factors. Governments and private parties imposed limitations on in-person access to physicians, which adversely affects us in at least two ways. First, these limitations can affect patient access to treatment. Because ILUVIEN is administered only by an injection into the eye, telemedicine is not a viable substitute when administration of treatment is required. Second, limitations on in-person access to physicians also makes it difficult or impossible for our sales representatives (including those employed by our distributors) to meet with retina specialists and their staff to educate them about the benefits of ILUVIEN and to provide support for insurance pre-certifications.

Our business is also negatively affected by patients’ concerns in the current environment. Prior to the pandemic, most of our ILUVIEN sales were driven by the use of ILUVIEN to treat diabetic macular edema, or DME. Given that governmental authorities have cited diabetes as a factor that places a person at higher risk for severe illness from COVID-19, many of those patients were unwilling to visit their physicians in person (even if otherwise permitted) due to their fear of contracting COVID-19.

In addition to the effects of limitations on in-person access to physicians, limitations on travel within and between the countries in which we market and sell ILUVIEN, as well as various types of “shelter in place” orders, has curtailed our in-person marketing activities.

These limitations and other effects of COVID-19 had a material adverse impact on our revenues late in the first quarter and in the month of April. We expect these factors to continue to adversely impact our revenue, but the extent and duration of that impact is uncertain at this time. Depending on the duration of these limitations and other effects of COVID-19, our liquidity and financial condition may be adversely affected in the future as well.

In response to these developments, we have implemented measures to focus on the safety of our customers and employees, while at the same time seeking to mitigate the impact on our financial position and operations. These measures include the following:

•We are managing our cost structure in the second quarter, minimizing all non-payroll spending where possible to mitigate our anticipated loss of revenue in this quarter and conserve our cash.

•We are significantly decreasing our external spending on commercial and medical activities related to the promotion of ILUVIEN.

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•Because we believe that our employees are critical to both (a) serving our customers and patients as the pandemic-related restrictions are lifted in the coming weeks and months, and (b) realizing the long-term value of ILUVIEN, we have determined to maintain our staffing levels at this time and do not currently have any plans to reduce them.

License Agreement with EyePoint Pharmaceuticals US, Inc.

In July 2017, we amended and restated our license agreement with EyePoint Pharmaceuticals US, Inc. (EyePoint), formerly known as pSivida US, Inc., which was made effective July 1, 2017 (the New Collaboration Agreement). Under the New Collaboration Agreement, we have rights to the technology underlying ILUVIEN for the treatment of uveitis, including NIU-PS, in Europe, the Middle East and Africa. The New Collaboration Agreement converted our previous profit share obligation to a royalty payable on global net revenues of ILUVIEN. We began paying a 2% royalty on net revenues and other related consideration to EyePoint effective July 1, 2017. The royalty amount increased to 6% as of December 12, 2018. We will pay an additional 2% royalty on global net revenues and other related consideration in excess of $75.0 million in any year. During the three months ended March 31, 2020 and 2019, we recognized approximately $581,000 and $516,000 of royalty expense, respectively. As of March 31, 2020, approximately $581,000 of this royalty expense was included in our accounts payable.

Following the signing of the New Collaboration Agreement, we retained a right to offset $15.0 million of future royalty payments. In March 2019, pursuant to the New Collaboration Agreement, we forgave $5,000,000 of the Future Offset in connection with the approval of ILUVIEN for NIU-PS in the U.K. As of March 31, 2020, the balance of the Future Offset was approximately $8,567,000. (See Note 9 of our notes to the accompanying Interim Financial Statements.)

Sources of Revenues

Our revenues for the three months ended March 31, 2020 and 2019 were generated from product sales primarily in the U.S., Germany and the U.K. In the U.S., two large pharmaceutical distributors accounted for 49% and 52% of our consolidated revenues for the three months ended March 31, 2020 and 2019, respectively. These U.S.-based distributors purchase ILUVIEN from us, maintain inventories of ILUVIEN and sell downstream to physician offices, pharmacies and hospitals. Internationally, in countries where we sell direct, our customers are hospitals, clinics and pharmacies. We sometimes refer to physician offices, pharmacies, hospitals and clinics as end users. In international countries where we sell to distributors, these distributors maintain inventory levels of ILUVIEN and sell to their customers.

Reverse Stock Split Effective November 14, 2019

On November 14, 2019, we filed a certificate of amendment to our restated certificate of incorporation with the Secretary of State of the State of Delaware, which effected a one-for-15 reverse stock split (the “reverse split”) of our issued and outstanding shares of common stock at 5:01 PM Eastern Time on that date. As a result of the reverse split, every 15 shares of common stock issued and outstanding were converted into one share of common stock.

First Amendment to 2019 Solar Capital Loan Agreement

On May 1, 2020, we entered into a First Amendment (the Amendment) to our $45,000,000 Loan and Security Agreement (the 2019 Solar Loan Agreement) with Solar Capital, as Agent, and the parties signing the Loan Agreement from time to time as Lenders, including Solar Capital in its capacity as a Lender (collectively, the Lenders). For a summary of the terms of the Amendment, see “Liquidity and Capital Resources - Indebtedness - Loans from Solar Capital.”

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Results of Operations



	Three Months Ended March 31,
	2020			2019
	(In thousands, except share and per share data)
NET REVENUE	$	14,535		$	12,890
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION	(1,927		)	(1,600		)
GROSS PROFIT	12,608			11,290

RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES	2,883			2,727
GENERAL AND ADMINISTRATIVE EXPENSES	3,181			3,393
SALES AND MARKETING EXPENSES	5,672			5,913
DEPRECIATION AND AMORTIZATION	654			652
OPERATING EXPENSES	12,390			12,685
NET INCOME (LOSS) FROM OPERATIONS	218			(1,395		)

INTEREST EXPENSE AND OTHER	(1,292		)	(1,228		)
UNREALIZED FOREIGN CURRENCY LOSS, NET	(81		)	(69		)
NET LOSS BEFORE TAXES	(1,155		)	(2,692		)
PROVISION FOR TAXES	(43		)	(71		)
NET LOSS	(1,198		)	(2,763		)
NET LOSS PER COMMON SHARE — Basic and diluted	$	(0.24	)	$	(0.59	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING — Basic and diluted	4,980,722			4,716,054

Net Revenue

We began generating revenue from ILUVIEN in 2013. Revenue from our U.S. distributors and revenue from our partners in the markets in our international segment where we do not sell direct fluctuates depending on the timing of the shipment of ILUVIEN to the distributors and the distributors’ sales of ILUVIEN to their customers.

Net revenue increased by approximately $1.6 million, or 12%, to approximately $14.5 million for the three months ended March 31, 2020, compared to approximately $12.9 million for the three months ended March 31, 2019. The increase was primarily attributable to revenue increases in our international segment, including increases of approximately $1.0 million in the international markets where we sell direct and $340,000 in the international markets where we sell to distributors. The increase was also attributable to a revenue increase of approximately $300,000 in the U.S. Importantly, we achieved this growth despite the temporary shortage of inventory in our U.S. business, as well as the end of quarter negative impact of the COVID-19 pandemic.

The increase in our net revenue in the first quarter of 2020 over the same period in 2019 is not indicative of our future operating results or of future financial condition.

Cost of Goods Sold, Excluding Depreciation and Amortization, and Gross Profit

Gross profit is affected by costs of goods sold, which includes costs of manufactured goods sold and royalty payments to EyePoint under the New Collaboration Agreement. Additionally, cost of goods sold from our international distributors fluctuates depending on the timing of the shipment of ILUVIEN to our international distributors.

Cost of goods sold, excluding depreciation and amortization, increased by approximately $300,000, or 19%, to approximately $1.9 million for the three months ended March 31, 2020, compared to approximately $1.6 million for the three months ended March 31, 2019. The increase was primarily attributable to increased sales.

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Gross profit increased by approximately $1.3 million, or 12%, to approximately $12.6 million for the three months ended March 31, 2020, compared to approximately $11.3 million for the three months ended March 31, 2019. Gross margin was 87% and 88% for the three months ended March 31, 2020 and 2019, respectively.

Research, Development and Medical Affairs Expenses

Currently, our research, development and medical affairs expenses are primarily focused on activities that support ILUVIEN and include salaries and related expenses for research and development and medical affairs personnel, including medical sales liaisons, as well as costs related to the provision of medical affairs support, including scientific advisory boards, symposia development for physician education, and costs related to compliance with FDA, European Medicines Agency or other regulatory requirements. We expense both internal and external development costs as they are incurred.

Research, development and medical affairs expenses increased by approximately $200,000, or 7%, to approximately $2.9 million for the three months ended March 31, 2020, compared to approximately $2.7 million for the three months ended March 31, 2019. The increase was primarily attributable to clinical research.

General and Administrative Expenses

General and administrative expenses consist primarily of compensation for employees in executive and administrative functions, including finance, accounting, legal, information technology and human resources. Other significant costs include facilities costs and professional fees for accounting and legal services. We expect to continue to incur significant costs to comply with the corporate governance, internal control and similar requirements applicable to public companies.

General and administrative expenses decreased by approximately $200,000, or 6%, to approximately $3.2 million for the three months ended March 31, 2020, compared to approximately $3.4 million for the three months ended March 31, 2019. The decrease was primarily attributable to lower stock-based compensation expenses.

Sales and Marketing Expenses

Sales and marketing expenses consist primarily of third-party service fees and compensation for employees for the commercial promotion, the assessment of the commercial opportunity of, the development of market awareness for, the pursuit of market reimbursement for and the execution of launch plans for ILUVIEN in countries where we have not previously sold ILUVIEN or are marketing it for a different indication. Other costs include professional fees associated with developing plans for ILUVIEN or any future products or product candidates and maintaining public relations.

Sales and marketing expenses decreased by approximately $200,000, or 3%, to approximately $5.7 million for the three months ended March 31, 2020, compared to approximately $5.9 million for the three months ended March 31, 2019. The decrease was primarily attributable to an approximately $460,000 decrease in marketing costs, the largest component of which was associated with the first quarter 2019 launch of our direct-to-patient advertising pilot program in the U.S., partially offset by an increase of approximately $190,000 in personnel costs.

Operating Expenses

As a result of the increases and decreases in various expenses described above, total operating expenses decreased by approximately $300,000, or 2%, to approximately $12.4 million for the three months ended March 31, 2020, compared to approximately $12.7 million for the three months ended March 31, 2019. The decrease was primarily attributable to an approximately $200,000 decrease in general and administrative expenses and an approximately $200,000 decrease in sales and marketing expenses, partially offset by a $200,000 increase in research, development and medical affairs expenses as described above.

Interest Expense and Other

Interest expense and Other increased by approximately $100,000, or 8%, to approximately $1.3 million for the three months ended March 31, 2020, compared to approximately $1.2 million for the three months ended March 31, 2019. For these periods, interest expense consisted primarily of interest and amortization of deferred financing costs and debt discounts associated with our outstanding debt under the 2018 and 2019 Solar Loan Agreements with Solar Capital. As discussed in Note 10 of our notes to Interim Financial Statements, we entered into the 2018 Solar Loan Agreement on January 5, 2018, which we refinanced with the 2019 Solar Loan Agreement on December 31, 2019.

Basic and Diluted Net Income (Loss) Applicable to Common Stockholders per Share of Common Stock

We follow FASB Accounting Standards Codification, Earnings Per Share (ASC 260), which requires the reporting of both basic and diluted earnings per share. Because our preferred stockholders participate in dividends equally with common

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stockholders (if we were to declare and pay dividends), we use the two-class method to calculate EPS. However, our preferred stockholders are not contractually obligated to share in losses.

Common stock equivalent securities that would potentially dilute basic EPS in the future, but were not included in the computation of diluted EPS because they were either classified as participating and do not share in losses or would have been anti-dilutive, were approximately 2,464,453 for the three months ended March 31, 2020 and 2,324,009 for the three months ended March 31, 2019.

Results of Operations - Segment Review

The following selected unaudited financial and operating data are derived from our Interim Financial Statements. The results and discussions that follow reflect how executive management monitors the performance of our reporting segments.

We have three segments: U.S., International and Other. Each segment is separately managed and is evaluated primarily upon segment loss from operations. Non-cash items including stock-based compensation expense, depreciation and amortization are categorized as Other. We allocate certain operating expenses between our reporting segments based on activity-based costing methods. These activity-based costing methods require us to make estimates that affect the amount of each expense category that is attributed to each segment. Changes in these estimates will directly affect the amount of expense allocated to each segment and therefore the operating profit of each reporting segment. There were no significant changes in our expense allocation methodology during 2020 or 2019.

U.S. Segment



	Three Months Ended March 31,
	2020			2019
	(In thousands)
NET REVENUE	$	7,068		$	6,766
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION	(759		)	(685		)
GROSS PROFIT	6,309			6,081

RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES	1,922			1,427
GENERAL AND ADMINISTRATIVE EXPENSES	1,973			1,933
SALES AND MARKETING EXPENSES	4,280			4,041
OPERATING EXPENSES	8,175			7,401
SEGMENT LOSS FROM OPERATIONS	$	(1,866	)	$	(1,320	)

U.S. Segment - three months ended March 31, 2020 compared to the three months ended March 31, 2019

Net revenue. Net revenue increased by approximately $300,000, or 4%, to approximately $7.1 million for the three months ended March 31, 2020, compared to approximately $6.8 million for the three months ended March 31, 2019. Net revenue during the three months ended March 31, 2020 was negatively affected due to the impact from the COVID-19 virus pandemic late in the first quarter, as well as a temporary shortage in stock in the first quarter. There was no material increase in the stock levels held by our U.S. distributors during the quarter.

Cost of goods sold, excluding depreciation and amortization. Cost of goods sold, excluding depreciation and amortization, increased by approximately $70,000, or 10%, to approximately $760,000 for the three months ended March 31, 2020, compared to approximately $690,000 for the three months ended March 31, 2019.

Research, development and medical affairs expenses. Research, development and medical affairs expenses increased by approximately $500,000, or 36%, to approximately $1.9 million for the three months ended March 31, 2020, compared to approximately $1.4 million for the three months ended March 31, 2019. The increase was primarily attributable to clinical research.

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General and administrative expenses. General and administrative expenses increased by approximately $100,000, or 5%, to approximately $2.0 million for the three months ended March 31, 2020, compared to approximately $1.9 million for the three months ended March 31, 2019.

Sales and marketing expenses. Sales and marketing expenses increased by approximately $300,000, or 8%, to approximately $4.3 million for the three months ended March 31, 2020, compared to approximately $4.0 million for the three months ended March 31, 2019. The increase was primarily attributable to an increase of approximately $250,000 in personnel costs, as we maintained full staffing levels during the three months ended March 31, 2020, compared to the three months ended March 31, 2019.

International Segment



	Three Months Ended March 31,
	2020			2019
	(In thousands)
NET REVENUE	$	7,467		$	6,124
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION	(1,168		)	(915		)
GROSS PROFIT	6,299			5,209

RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES	893			1,170
GENERAL AND ADMINISTRATIVE EXPENSES	936			988
SALES AND MARKETING EXPENSES	1,292			1,705
OPERATING EXPENSES	3,121			3,863
SEGMENT LOSS FROM OPERATIONS	$	3,178		$	1,346

International Segment - three months ended March 31, 2020 compared to the three months ended March 31, 2019

Net revenue. Net revenue increased by approximately $1.4 million, or 23%, to approximately $7.5 million for the three months ended March 31, 2020, compared to approximately $6.1 million for the three months ended March 31, 2019. The increase was primarily attributable to increases of approximately $1.0 million in the international markets where we sell direct and $340,000 in the international markets where we sell to distributors. A significant amount of the growth was due to our increasing success in the marketing and sale of ILUVIEN for a new indication for the prevention of relapse in recurrent NIU-PS of the eye in the United Kingdom and Germany. We began selling ILUVIEN for this indication in the second half of 2019.

Cost of goods sold, excluding depreciation and amortization. Cost of goods sold, excluding depreciation and amortization, increased by approximately $280,000, or 30%, to approximately $1.2 million for the three months ended March 31, 2020, compared to approximately $920,000 for the three months ended March 31, 2019. The increase was primarily attributable to our increased international sales.

Research, development and medical affairs expenses. Research, development and medical affairs expenses decreased by approximately $310,000, or 26%, to approximately $890,000 for the three months ended March 31, 2020, compared to approximately $1.2 million for the three months ended March 31, 2019. The decrease was primarily related to a decrease in costs associated with our 5-year open label registry study as it nears completion.

General and administrative expenses. General and administrative expenses decreased by approximately $50,000, or 5%, to approximately $940,000 for the three months ended March 31, 2020, compared to approximately $990,000 for the three months ended March 31, 2019.

Sales and marketing expenses. Sales and marketing expenses decreased by approximately $400,000, or 24%, to approximately $1.3 million for the three months ended March 31, 2020, compared to approximately $1.7 million for the three months ended March 31, 2019. The decrease was primarily attributable to decreases of approximately $190,000 in marketing costs and $110,000 in market access costs.

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Other Segment



	Three Months Ended March 31,
	2020			2019
	(In thousands)
RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES	$	68		$	130
GENERAL AND ADMINISTRATIVE EXPENSES	272			472
SALES AND MARKETING EXPENSES	100			167
DEPRECIATION AND AMORTIZATION	654			652
OPERATING EXPENSES	1,094			1,421
SEGMENT LOSS FROM OPERATIONS	$	(1,094	)	$	(1,421	)

Our chief operating decision maker manages and evaluates our U.S. and International segments based on net loss from operations adjusted for certain non-cash items, such as stock-based compensation expense and depreciation and amortization. Therefore, these non-cash expenses included in research, development and medical affairs expenses, general and administrative expenses, and sales and marketing expenses are classified within the Other segment within our Interim Financial Statements.

Within the respective financial statement line items included in the Other segment, stock-based compensation expense, collectively, decreased by approximately $330,000, or 43%, to $440,000 for the three months ended March 31, 2020, compared to approximately $770,000 for the three months ended March 31, 2019.

Depreciation and amortization was approximately $650,000 for the three months ended March 31, 2020 and 2019.

Liquidity and Capital Resources

Overview

Since inception, we have incurred recurring losses, negative cash flow from operations and have accumulated a deficit in stockholders’ equity of $388.8 million through March 31, 2020.

As explained above in “Effects of the COVID-19 Pandemic,” the unprecedented and adverse effects of COVID-19 pandemic, and its unpredictable duration, in the regions where we have customers, employees and distributors have had a material adverse effect on our sales of ILUVIEN and thus on our net revenues. Depending on the duration of the pandemic and the success of our strategy to conserve our cash and otherwise mitigate the impact of the pandemic, it may have a material adverse effect on our liquidity and financial condition in the future as well. We expect that the pandemic may adversely affect our ability to operate as we did before. As a result, it is difficult to project the extent of that impact now and as this situation continues to evolve.

Since January 2018, we have funded our operations through the 2018 and 2019 Solar Loan Agreements described below and a small offering of common stock. In April 2020, we obtained a loan under the Paycheck Protection Program established as part of the Coronavirus Aid, Relief and Economic Security Act, or the CARES Act. Our loans do not include a revolving loan feature and have been fully advanced by the respective lenders. We currently have no additional borrowing capacity, and the 2019 Solar Loan Agreement generally prohibits any additional debt unless we obtain the prior consent of Solar Capital. Currently, we cannot access the equity markets without severe dilution to our current stockholders.

Indebtedness

Loans from Solar Capital. On January 5, 2018, we entered into a $40.0 million Loan and Security Agreement (the 2018 Solar Loan Agreement) with Solar Capital Ltd. (Solar Capital) and other lenders. Under the 2018 Solar Loan Agreement, we borrowed the entire $40.0 million as a term loan that was scheduled to mature on July 1, 2022 (the 2018 Solar Loan). We used the proceeds of the 2018 Solar Loan to refinance the then outstanding loan under our previous loan agreement with Hercules Capital, Inc. and to pay closing expenses associated with the 2018 Solar Loan Agreement.

On December 31, 2019, we refinanced the 2018 Solar Loan Agreement by entering into a $45.0 million Loan and Security Agreement (the 2019 Solar Loan Agreement) with Solar Capital as Collateral Agent (Agent), and the parties signing the 2018 Solar Loan Agreement from time to time as Lenders, including Solar Capital in its capacity as a Lender (collectively, the Lenders). Under the 2019 Solar Loan Agreement, we borrowed $42.5 million on December 31, 2019 and $2.5 million on February 21, 2020 (the 2019 Solar Loan). The 2019 Solar Loan matures on July 1, 2024. We used the initial proceeds of the

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2019 Solar Loan to pay off the 2018 Solar Loan, along with related prepayment, legal and other fees and expenses totaling approximately $2.3 million, which included $2.2 million in fees to Solar Capital. We expect to use the remaining proceeds of the 2019 Solar Loan to provide additional working capital for general corporate purposes, and those proceeds are part of the cash and cash equivalents described below.

On May 1, 2020, we entered into a First Amendment (the Amendment) to the 2019 Solar Loan Agreement. The Amendment, among other things:

(a)eliminates the previous requirement that the following covenant (the Revenue Covenant) be measured at June 30, 2020 and September 30, 2020: we shall not permit revenues (under U.S. GAAP) from the sale of ILUVIEN in the ordinary course of business to third party customers, on a trailing six-month basis, to be less than a specified minimum revenue amount for each such date;

(b)requires that the Revenue Covenant be measured at November 30, 2020 and specifies a new minimum revenue amount in that regard;

(c)requires that the Revenue Covenant be measured at December 31, 2020 and specifies a new minimum revenue amount in that regard; and

(d)requires that the Revenue Covenant be measured at March 31, 2021 and at the last day of each quarter thereafter, with the minimum revenue amount equal to a percentage of our projected revenues in accordance with an annual plan we submit to Agent by January 15th of such year, such plan to be approved by our board of directors and Agent in its sole discretion.

The Amendment also adds the following new minimum liquidity requirement that is in effect from May 1, 2020 until we notify Agent that we have met the Revenue Covenant at November 30, 2020: we shall not permit the aggregate amount of unrestricted cash and cash equivalents to be less than the sum of (i) $8,500,000 plus (ii) the amount of our accounts payable that have not been paid within 90 days from the invoice date of the relevant account payable.

Paycheck Protection Program Loan. On April 22, 2020, we received approximately $1.8 million in support (the PPP Loan) from the U.S. federal government under the Paycheck Protection Program established as part of the Coronavirus Aid, Relief and Economic Security Act, or the CARES Act. The PPP Loan is unsecured and is evidenced by a note (the HSBC Note) in favor of HSBC Bank USA, National Association (HSBC) as the lender and is governed by a Loan Agreement with HSBC.

The interest rate on the HSBC Note is 1.0% per annum. Payments of principal and interest are deferred for 180 days from the date of the HSBC Note. The Paycheck Protection Program provides a mechanism for forgiveness of up to the full amount borrowed as long as we use the loan proceeds during the eight-week period after the loan origination for eligible purposes as described in the CARES Act and related guidance. We have placed the PPP Loan proceeds in the bank account we use for payroll and will use the proceeds for the sole purpose of meeting payroll obligations and other eligible uses under the Paycheck Protection Program when due. Solar Capital and the other Lenders consented to the indebtedness incurred under the PPP Loan.

Current Cash Position

As of March 31, 2020, we had approximately $12.2 million in cash and cash equivalents, an increase of $2.8 million from the $9.4 million in cash and cash equivalents that we reported on December 31, 2019. Contributing to the increase, in February 2020, we borrowed the remaining $2.5 million under the $45.0 million loan agreement from Solar Capital. In April 2020, we received approximately $1.8 million in support from the U.S. federal government under the Paycheck Protection Program established as part of the Coronavirus Aid, Relief and Economic Security Act, or the CARES Act. Especially in light of the adverse effects of COVID-19, we may need to raise additional capital to fund our business strategy, including the continued commercialization of ILUVIEN and the retention of our current employees and staff. In any event, we have adjusted and we expect to continue to adjust our commercial spending so that we can continue to operate with our existing cash resources. The actual amount of funds that we will need will depend on many factors, some of which are beyond our control. We may need funds sooner than currently anticipated. See “Effects of the COVID-19 Pandemic” above for an explanation of our strategy to conserve our cash and otherwise mitigate the impact of the pandemic on our financial position and operations.

We cannot ensure that our mitigation strategies will be effective or will continue to be effective if the duration of the pandemic is longer than we expect. We cannot be sure that additional financing will be available when needed or that, if available, the additional financing could be obtained on terms that are not significantly detrimental to us or our stockholders. If we were to raise additional funds by issuing equity securities, substantial dilution to existing stockholders would likely result, and the terms of any new equity securities may have a preference over our common stock. If we were to attempt to raise additional funds through strategic collaboration agreements, we may not be successful in obtaining those agreements, or in receiving milestone or royalty payments under them. If we were to attempt to raise additional funds through debt financing, (a) the terms of the debt may involve significant cash payment obligations as well as covenants and specific financial ratios that

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may restrict our ability to achieve our business strategy; and (b) we would be required to obtain the permission or participation of Solar Capital, which we might not be able to obtain. Our recurring losses and any potential needs to raise capital create substantial doubt about our ability to continue as a going concern for the next 12 months following the issuance of the financial statements for the filing of this Form 10-Q.

Sources and Uses of Cash for the three months ended March 31, 2020 compared to the three months ended March 31, 2019

For the three months ended March 31, 2020, cash provided by our operations was approximately $550,000. The cash provided by our operations was primarily due to our net loss of $1.2 million, offset by $650,000 of non-cash depreciation and amortization, $440,000 of non-cash stock-based compensation expense and $240,000 of non-cash interest expense associated with the amortization of our debt discount. Further reducing cash from operations was a $2.8 million net decrease in accounts payable, accrued expenses and other current liabilities and a $150,000 decrease in long-term liabilities. These were offset by a $3.0 million decrease in accounts receivable, a $180,000 decrease in inventory and a $50,000 decrease in prepaid expenses and other current assets.

For the three months ended March 31, 2019, cash provided by our operations was approximately $280,000. The cash provided by our operations was primarily due to our net increase in our working capital. Accounts receivable decreased by $1.8 million and inventory decreased by $530,000. These net cash increases were offset by a net increase of $560,000 in accounts payable, accrued expenses and other current liabilities and an increase of $380,000 in prepaid expenses and other current assets. Further impacting our cash provided by operations was our net loss of $2.8 million, which was offset by $770,000 of non-cash stock-based compensation expense, $650,000 for non-cash depreciation and amortization and $210,000 for non-cash interest expense associated with the amortization of our debt discount.

For the three months ended March 31, 2020, net cash used in our investing activities was approximately $25,000, which was due to the purchase of property and equipment.

For the three months ended March 31, 2019, net cash used in our investing activities was approximately $15,000.

For the three months ended March 31, 2020, net cash used in our financing activities was approximately $2.4 million which is primarily due to borrowing the remaining $2.5 million under the 2019 Solar Loan Agreement.

For the three months ended March 31, 2019, net cash provided by our financing activities was approximately $110,000, which is due to payments of finance lease obligations.

Contractual Obligations and Commitments

There have been no other material changes to our contractual obligations and commitments outside the ordinary course of business from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on March 2, 2020.

Off-Balance Sheet Arrangements

We do not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, that would have been established to facilitate off-balance sheet arrangements (as that term is defined in Item 303(a)(4)(ii) of Regulation S-K) or other contractually narrow or limited purposes. As such, we are not exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in those types of relationships. We enter into guarantees in the ordinary course of business related to the guarantee of our own performance and the performance of our subsidiaries.

Impact of Recent Accounting Pronouncements

See Note 3 of our notes to Interim Financial Statements for a description of recent accounting pronouncements, including the expected dates of adoption and expected effects on results of operations and financial condition, if known.

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

Not required for smaller reporting companies.

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ITEM 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including the Chief Executive Officer and the Chief Financial Officer, we evaluated the effectiveness of the design and operation of our “disclosure controls and procedures” (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that our disclosure controls and procedures were effective as of March 31, 2020.

Changes in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the three months ended March 31, 2020 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

Control systems, no matter how well conceived and operated, are designed to provide a reasonable, but not an absolute, level of assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Because of the inherent limitations in any control system, misstatements due to error or fraud may occur and not be detected.

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PART II. OTHER INFORMATION

ITEM 1. Legal Proceedings

We are not a party to any material pending legal proceedings, and management is not aware of any contemplated proceedings by any governmental authority against us.

ITEM 1A. Risk Factors

In our Annual Report on Form 10-K for the fiscal year ended December 31, 2019, filed with the SEC on March 2, 2020, we identify under Item 1A of Part I important factors that could affect our business, financial condition, results of operations and future operations and could cause our actual results for future periods to differ materially from our anticipated results or other expectations, including those expressed in any forward-looking statements made in this Quarterly Report on Form 10-Q. Except as described below, there have been no material changes in our risk factors after the filing of our Annual Report on Form 10-K for the fiscal year ended December 31, 2019. However, the risks described in our Form 10-K are not the only risks we face. Additional risks and uncertainties that we currently deem to be immaterial or not currently known to us, as well as other risks reported from time to time in our reports to the SEC, also could cause our actual results to differ materially from our anticipated results or other expectations.

You should read the following information in conjunction with the Interim Financial Statements and related notes in Part I, Item 1, Financial Information and the discussion and analysis of our financial condition in Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

The COVID-19 pandemic has had, and we expect will continue to have, certain negative impacts on our business, and such impacts may have a material adverse effect on our results of operations, financial condition and cash flows.


•	We have experienced a decrease in sales of ILUVIEN in the U.S. and in our international markets that have been affected by the COVID-19 pandemic resulting from, among other things:


▪	Governments and private parties have imposed limitations on in-person access to physicians, which can:


◦	affect patient access to treatment, given that ILUVIEN is administered only by an injection into the eye, which means telemedicine is not a viable substitute; and


◦	make it difficult or impossible for our sales representatives (including those employed by our distributors) to meet with retina specialists and their staff to educate them about the benefits of ILUVIEN and to provide support for insurance pre-certifications.

▪

Our business is also negatively affected by patient behavior in the current environment. Most of our ILUVIEN sales are driven by the use of ILUVIEN to treat diabetic macular edema, or DME. Given that governmental authorities have cited diabetes as a factor that places a person at higher risk for severe illness from COVID-19, many of those patients may be unwilling to visit their physicians in person (even if otherwise permitted) due to their fear of contracting COVID-19.

These limitations and other effects of COVID-19 had a material adverse impact on our revenues late in the first quarter of 2020 and in April 2020. We expect these factors to continue to adversely impact our revenue, but the extent and duration of that impact is uncertain at this time. If the COVID-19 pandemic intensifies, its duration is longer than we expect or if a second pandemic follows after initial resolution, its negative impact on our sales and thus our liquidity and financial condition could be more prolonged and may be severe. Financial uncertainty associated with the adverse effects of COVID-19, and the duration of those effects, could have an impact in future periods on certain estimates used in the preparation of our quarterly financial results, including impairment of intangible assets, the income tax provision and realizability of certain receivables.


•	Limitations on travel within and between the countries in which we market and sell ILUVIEN, as well as various types of “shelter in place” orders, have curtailed our in-person marketing activities, which have in turn contributed to lower sales of ILUVIEN.

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•	As a result of the COVID-19 pandemic, including related governmental guidance or directives, we have required almost all office-based employees, including almost all employees based at our headquarters in Georgia, to work remotely. We may experience reductions in productivity and disruptions to our business routines while our remote work policy remains in place.

•

We may fail to maintain or modify as necessary our internal controls over financial reporting in the new environment in which (a) almost all of our employees are working remotely and (b) we or our distributors have been and may be required to modify our standard business processes to take into account the current environment in light of COVID-19. If we fail to maintain proper and effective internal control over financial reporting, our operating results and our ability to operate our business could be harmed.


•	We may fail to plan appropriately to meet the demand of our customers for ILUVIEN, which could lead either to (a) ILUVIEN being out of stock or (b) our investment of a greater amount of cash in inventory than we need. Either event could have a material adverse effect on our results of operations, financial condition and cash flows.

•

As the result of lower sales of ILUVIEN, we may fail to comply with financial covenants in our $45.0 million 2019 Solar Loan Agreement, as amended, that are based on (a) minimum trailing six months’ revenues as of November 30, 2020 and the end of each calendar quarter thereafter and (b) a minimum liquidity requirement that is in effect from May 1, 2020 until we notify Solar Capital that we have met the minimum revenue amount at November 30, 2020. If an event of default under the 2019 Solar Loan Agreement occurs, Solar Capital may accelerate all of our repayment obligations and take control of our pledged assets, potentially requiring us to raise additional financing, renegotiate the 2019 Solar Loan Agreement on terms less favorable to us or immediately cease operations. Any declaration by Solar Capital of an event of default could significantly harm our business and prospects and could cause the price of our common stock to decline significantly after we publicly disclose that event in an SEC filing. Further, if we are liquidated, Solar Capital’s right to repayment would be senior to the rights of our stockholders.

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

ITEM 3. Defaults Upon Senior Securities

None.

ITEM 4. Mine Safety Disclosures

Not applicable.

ITEM 5. Other Information

On March 18, 2020, the compensation committee of our board of directors granted shares of restricted stock to our executive officers as follows:



Name	Total Number of Shares of Restricted Stock Granted	Vesting Dates and Number of Shares of Restricted Stock Vested on Those Dates
Richard S. Eiswirth, Jr.	10,884	5,442 on March 11, 2021
		5,442 on March 12, 2021
Philip Ashman, Ph.D.	5,389	5,389 on March 4, 2021
Samer Kaba	4,683	4,683 on March 5, 2021
David Holland	5,172	5,172 on March 8, 2021
J. Philip Jones	3,958	3,958 on March 9, 2021

On the date of grant, the closing price of our common stock on the Nasdaq Global Market was $3.12 per share. The form of restricted stock agreement is attached as Exhibit 10.5.C to this Form 10-Q, along with a form of restricted stock unit agreement that is attached as Exhibit 10.5.D to this Form 10-Q.

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ITEM 6. Exhibits



Exhibit Number		Description

3.1		Restated Certificate of Incorporation of Registrant, as amended on various dates (filed as Exhibit 3.1 to the Registrant’s Annual Report on Form 10-K, as filed on March 2, 2020, and incorporated herein by reference).

3.2		Amended and Restated Bylaws of the Registrant, as amended (filed as Exhibit 3.2 to the Registrant’s Current Report on Form 10-K, as filed on March 2, 2020 and incorporated herein by reference).

10.3.I†*		First Amendment to Restricted Stock Unit Award Agreement under 2010 Equity Incentive Plan of Richard S. Eiswirth, Jr.

10.5.C†*		Form of Restricted Stock Agreement under the Alimera Sciences, Inc. 2019 Omnibus Incentive Plan.

10.5.D†*		Form of Restricted Stock Unit Agreement under the Alimera Sciences, Inc. 2019 Omnibus Incentive Plan.

31.1*		Certification of the Principal Executive Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of the Principal Financial Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*		Certification of the Chief Executive Officer and Chief Financial Officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS+		XBRL Instance Document.

101.SCH+		XBRL Taxonomy Extension Schema Document.

101.CAL+		XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF+		XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB+		XBRL Taxonomy Extension Label Link Document.

101.PRE+		XBRL Taxonomy Extension Presentation Linkbase Document.

*	Filed herewith.

†	Management contracts and compensatory plans and arrangements.

+	Users of this data are advised pursuant to Rule 406T of Regulation S-T that this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended and otherwise is not subject to liability under these sections.

The certification attached as Exhibit 32.1 that accompanies this Quarterly Report on Form 10-Q is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Alimera Sciences, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Quarterly Report on Form 10-Q, irrespective of any general incorporation language contained in such filing.

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Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



	ALIMERA SCIENCES, INC.

May 6, 2020	By:	/s/ Richard S. Eiswirth, Jr.
		Richard S. Eiswirth, Jr.
		President and Chief Executive Officer
		(Principal Executive Officer)


May 6, 2020	By:	/s/ J. Philip Jones
		J. Philip Jones
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

Exhibit 10.3.I

FIRST AMENDMENT

Dated March 4, 2020

TO RESTRICTED STOCK UNIT AWARD AGREEMENT

RICHARD S. EISWIRTH, JR.

The Restricted Stock Unit Award Agreement (the “RSU Agreement”) of Richard S. Eiswirth, Jr. dated January 23, 2019 related to restricted stock units granted to him on that date by the Compensation Committee of the Board of Directors of Alimera Sciences, Inc. (the “Company”) shall be and hereby is amended as follows:


1.	The following section of the RSU Agreement is deleted in its entirety:

Withholding Taxes

Unless you elect prior to March 31, 2017, which election must be made on a Permissible Trading Day, to satisfy Withholding Taxes through any of the following means or by a combination of such means: (i) withholding from any compensation otherwise payable to you by the Company or an Affiliate; or (ii) tendering a cash payment to the Company (which may be in the form of a check, electronic wire transfer or other method permitted by the Company), then to the greatest extent permitted under the Plan and applicable law, applicable Withholding Taxes will be satisfied through the mandatory sale of a number of the shares subject to the Award and the remittance of the cash proceeds of such sale to the Company, pursuant to a “same day sale.” You authorize the Company to make payment from the cash proceeds of this sale directly to the appropriate taxing authorities in an amount equal to the Withholding Taxes. It is the Company’s intent that the mandatory sale to cover Withholding Taxes imposed by the Company on the Participant in connection with the receipt of this Award comply with the requirements of Rule 10b5-1(c)(1)(i)(B) under the Exchange Act and be interpreted to comply with the requirements of Rule 10b5-1(c).

If, for any reason, such “same day sale” commitment does not result in sufficient proceeds to satisfy the Withholding Taxes, the Company or an Affiliate may, in its sole discretion, satisfy all or any portion of the Withholding Taxes relating to your Award by any of the following means or by a combination of such means: (i) withholding from any compensation otherwise payable to you by

the Company or an Affiliate; or (ii) causing you to tender a cash payment (which may be in the form of a check, electronic wire transfer or other method permitted by the Company). Unless the tax withholding obligations of the Company and/or any Affiliate are satisfied, the Company shall have no obligation to deliver to you any Common Stock. Withholding Taxes shall be equal to the Company’s required tax withholding obligations using the minimum statutory withholding rates for federal, state, local and foreign tax purposes, including payroll taxes, that are applicable to supplemental taxable income.


2.	The above section of the RSU Agreement is replaced in its entirety by the following section:

Withholding Taxes

The Company shall deduct and withhold, from the number of shares of the Company’s Common Stock (“Shares”) to which you are entitled upon vesting of your units, the number of Shares, valued at the closing price of the Shares on the Nasdaq Global Market on the date of delivery of the Shares, that is equal in value to the withholding tax obligations that arise in connection with the vesting of your units and the related delivery of Shares to you. The number of Shares so withheld shall be determined in good faith by the Company in compliance with the Plan and applicable law. If and to the extent that the value of the withheld Shares as so determined is insufficient to satisfy the withholding tax obligations in full, you agree to take all such other action as the Committee deems necessary to satisfy all obligations for the payment of such withholding taxes. If you fail to make such tax payments as required, the Company shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to you all federal, state and local taxes of any kind required by law to be withheld with respect to the Shares delivered to you. Notwithstanding any action the Company takes with respect to any or all income tax, social insurance, payroll tax or other tax-related withholding (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and remains your responsibility, and the Company makes no representation or undertakings regarding the treatment of any Tax-Related Items in connection with the award, vesting or settlement of the units.


3.	Except as amended hereby, the RSU Agreement remains in effect.

* * * * * * * *

IN WITNESS WHEREOF, the parties hereto have executed this First Amendment to Restricted Stock Unit Award Agreement as of the date first set forth above. The officer signing on behalf of the Company below was duly authorized by the Compensation Committee of the Board of Directors.

ALIMERA SCIENCES, INC.

By:

Name:

Title:

Richard S. Eiswirth, Jr.

Exhibit 10.5.C

ALIMERA SCIENCES, INC.

RESTRICTED STOCK AGREEMENT

(time-based)

GRANTEE: ___________________________

NO. OF RESTRICTED SHARES: _________

GRANT DATE: _______________

This Agreement (the “Agreement”) evidences the award of the number of restricted shares specified above (each, an “Award Share,” and collectively, the “Award Shares”) of the Common Stock of Alimera Sciences, Inc., a Delaware corporation (the “Company”), granted to the grantee specified above (the “Grantee”), effective as of the grant date specified above (the “Grant Date”), pursuant to the Company’s 2019 Omnibus Incentive Plan (the “Plan”) and conditioned upon the Grantee’s agreement to the terms described below. All of the provisions of the Plan are expressly incorporated into this Agreement.

1. Terminology. Unless otherwise provided in this Agreement, capitalized words used herein shall have the same meaning as set forth in the Plan.

2. Restrictions on Transfer.

(a) No Award Share may be sold, assigned, transferred, pledged, hypothecated or disposed of in any way (whether by operation of law or otherwise), and shall not be subject to execution, attachment or similar process, until all restrictions on such Award Share shall have lapsed in the manner provided in Section 3.

(b) Any attempt to dispose of any such Award Share in contravention of the restrictions set forth in Section 2(a) shall be null and void and without effect. The Company shall not be required to (i) transfer on its books any Award Shares that have been sold or transferred in contravention of this Agreement or (ii) treat as the owner of Award Shares, or otherwise accord voting, dividend or liquidation rights to, any transferee to whom Award Shares have been transferred in contravention of this Agreement.

3. Lapse of Restrictions. So long as the Grantee’s service as an employee of the Company is continuous from the Grant Date through the first (1^st) anniversary thereof, 100% of the Award Shares will become vested and the restrictions on such Award Shares set forth in Section 2(a) shall lapse on the first (1^st) anniversary of the Grant Date.

4. Accelerated Vesting.

(a)Acceleration Upon Change in Control. If a Change in Control occurs after the Grant Date and prior to the Grantee’s termination of

employment with the Company, 100% of the outstanding Award Shares shall be vested and the restrictions on such Award Shares set forth in Section 2(a) shall lapse; provided that notwithstanding anything else contained in this Section 4 to the contrary, except as set forth in the final sentence of Section 4(b), in no event shall the vesting of any Award Shares be accelerated to an extent or in a manner which would not be fully deductible by the Company for federal income tax purposes because of Section 280G of the Code.

(b)Change in Control Adjustment. If a Change in Control occurs after the Grant Date and if the Grantee is entitled under any agreement or arrangement to receive compensation that would constitute a parachute payment (including the acceleration of rights to settlement and delivery (vesting) of Award Shares under this Agreement and any other equity award agreement with the Company) within the meaning of Section 280G of the Code, the acceleration of any vesting under Section 3(a) shall be cancelled or other CIC Payments (as defined below) shall be reduced to the extent necessary to cause the aggregate present value of all payments in the nature of compensation to the Grantee that are contingent on a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company (the “CIC Payments”) not to exceed 2.99 times the “base amount,” all within the meaning of Section 280G of the Code. Such cancellation of vesting or other reductions in CIC Payments shall be made, in all cases: (i) if and to the extent not already provided, accelerated, granted or paid, as applicable, on account of other CIC Payments prior to the date of such cancellation, (ii) only to the least extent necessary so that no portion of the CIC Payments after such cancellation or reduction thereof shall be subject to the excise tax imposed by Section 4999 of the Code, and (iii) in a manner that results in the best economic benefit to the Grantee (in applying these principles, any cancellation of vesting or other reduction in CIC Payments shall be made in a manner consistent with the requirements of Section 409A of the Code, and where Tax Counsel (as defined below) determines that two economically equivalent amounts are subject to reduction but payable at different times, such amounts shall be reduced on a pro rata basis but not below zero). All determinations required to be made under this Section 4(b), and the assumptions to be utilized in arriving at such determinations, shall be made by “Tax Counsel” (which shall be a law firm, compensation consultant or accounting firm appointed by the Company), which shall provide its determinations and any supporting calculations to the Company within 10 business days of having made such determination. Tax Counsel shall consult with any compensation consultant, accounting firm and/or other legal counsel selected by the Company in determining which payments to, or for the benefit of, the Grantee are to be deemed to be CIC Payments. In connection with making determinations under this Section 4(b), Tax Counsel shall take into account, to the extent applicable, the value of any

reasonable compensation for services to be rendered (or for refraining from performing services) by the Grantee before or after the Change in Control.

Notwithstanding the foregoing, if the Grantee is a party to an employment or other agreement with the Company, or is a Grantee in a severance program sponsored by the Company, that contains express provisions regarding Section 280G and/or Section 4999 of the Code (or any similar successor provision) that apply to this Agreement, the Section 280G and/or Section 4999 provisions of such employment or other agreement or plan, as applicable, shall control as to this Agreement (for example, and without limitation, the Grantee may be a party to an employment agreement with the Company that provides for a “gross-up” as opposed to a “cut-back” in the event that the Section 280G thresholds are reached or exceeded in connection with a Change in Control and, in such event, the Section 280G and/or Section 4999 provisions of such employment agreement shall control as to this Agreement).

(c)Pro-Rata Vesting Upon Termination of Employment Due to Disability, Death or Retirement on or Prior to the Applicable Vesting Date. If the Grantee ceases to be employed by the Company or a Subsidiary as a result of the Grantee’s Disability, death or Retirement on or prior to becoming vested in accordance with Section 3, the following rules shall apply and shall be an exception to the vesting rules set forth in Section 3. The number of Award Shares, if any, that shall become vested, and with respect to which all restrictions under Section 2(a) shall lapse, on the first (1^st) anniversary of the Grant Date (or, if earlier, the date of such earlier Change in Control pursuant to Sections 4(a) and (b)) shall be (A) the same number, if any, to which the Grantee would have been entitled under Section 3, or with respect to a Change in Control, Sections 4(a) and 4(b), if the Grantee’s employment had not terminated, multiplied by (B) a fraction, the numerator of which shall be the number of whole months since the Grant Date that the Grantee was employed by the Company or a Subsidiary, and the denominator of which shall be the total number of months from the Grant Date until the first (1^st) anniversary of the Grant Date. Award Shares subject to this Section 4(c) that do not become vested as of the first (1^st) anniversary of the Grant Date shall be cancelled and forfeited.

(d)Definitions. For purposes of this Agreement, “Disability” means either (a) that the Grantee has met the definition of “Disability” under the Company’s Group Long Term Disability Insurance and has qualified to commence a disability benefit under such insurance, or (b) if the Grantee is not covered by such insurance, a permanent and total disability (within the meaning of Section 22(e)(3) of the Code or as otherwise determined by the Committee). For purposes of this Agreement, “Retirement” means a termination of employment by the Grantee that occurs upon or after both (a) the Grantee’s attainment of age 55 and (b) when Grantee’s years of service to the Company and its Subsidiaries (such years of service determined in accordance with the rules for determining years of service under the

Company’s 401(k) Plan) is at least ten (10). For purposes of this Agreement, “Change in Control” means a Change in Control as defined in the Plan that occurs after the Grant Date and that constitutes a “change in control event” with respect to the Grantee as defined in the United States Treasury Regulations Section 1.409A-3(i)(5).

5. Forfeiture. Except to the extent otherwise expressly provided in Section 4, if the Grantee’s employment with the Company and its Subsidiaries terminates before the first (1^st) anniversary of the Grant Date, all the Award Shares under this Agreement shall be cancelled and forfeited and shall revert to the Company as of the date of such termination. Notwithstanding the foregoing, all Award Shares are subject to recoupment, clawback, forfeiture, ineligibility, reduction and/or elimination as set forth in Section 10(p) below.

6. Restrictive Legend.

(a)Award Shares shall be evidenced in such manner as the Committee may deem appropriate, including book-entry registration or issuance of one or more stock certificates. Any certificate issued to evidence Award Shares shall be registered in the name of such Grantee and shall bear an appropriate legend referring to the terms, conditions and restrictions applicable to such Award, substantially in the following form:

“The transferability of this certificate and the shares of stock represented hereby are subject to the terms and conditions (including forfeiture) of the Alimera Sciences, Inc. 2019 Omnibus Incentive Plan and the applicable award agreement, dated as of [insert date]. Copies of such plan and award agreement are on file at the offices of Alimera Sciences, Inc., 6120 Windward Parkway, Suite 290, Alpharetta, GA 30005.”

If the Award Shares are held in book-entry form, then the book-entry account reflecting the issuance of the Award Shares in the Grantee’s name shall bear a legend or other notation substantially in the form above.

(b)The Committee may require that the certificates evidencing such Award Shares be held in custody by the Company until the restrictions thereon have lapsed and that, as a condition of the granting of the Award Shares, the applicable Grantee shall have delivered a stock power, endorsed in blank, relating to the Award Shares.

7. Delivery of Stock.

(a)If the Award Shares are evidenced by a stock certificate, as soon as practicable after the Award Shares have become vested and all restrictions with respect thereto have lapsed, the Company shall cause a stock certificate evidencing the vested Award Shares to be delivered to the Grantee, free of all restrictions hereunder.

(b)If the Award Shares are held in book-entry form, as soon as practicable after the Award Shares have become vested and all restrictions with respect thereto have lapsed, the Company shall cause the legend or other notation on the book-entry account to be removed.

(c)In the event of the death of the Grantee, a stock certificate with respect to the vested Award Shares as determined under Section 4(c) shall be delivered to the executors or administrators of the Grantee’s estate as soon as practicable following the later of (i) the Company’s receipt of notification of the Grantee’s death, or (ii) the first (1^st) anniversary of the Grant Date, free of all restrictions hereunder.

8. Tax Election and Tax Withholding.

(a)The Grantee hereby agrees to make adequate provision for federal, state, local and any other applicable taxes required by law to be withheld, if any, which arise in connection with the grant of the Award Shares or the release thereof from restrictions hereunder. The Company shall have the right to deduct from any compensation or any other payment of any kind due the Grantee (including withholding the issuance or delivery of shares of Common Stock or redeeming Award Shares) the amount of any federal, state, local or other taxes required by law to be withheld as a result of the grant of the Award Shares or the release thereof from the restrictions hereunder, in whole or in part. In lieu of such deduction, the Company may require the Grantee to make a cash payment to the Company equal to the amount required to be withheld. If the Grantee does not make such payment when requested, the Company may refuse to cause the legend or other notation on the stock certificate or book entry account, as applicable, to be removed until arrangements satisfactory to the Committee for such payment have been made. Consistent with the terms of Section 13.3 of the Plan, if the Grantee fails to make such tax payments as required, the Company shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to the Grantee all federal, state and local taxes of any kind required by law to be withheld with respect to the Award Shares.

(b)Unless the Committee directs the Company to sell a portion of the Award Shares to satisfy the withholding taxes as provided in Section 8(c), the Company shall deduct and withhold the number of Award Shares, valued at the Fair Market Value of the Award Shares on the date of delivery of the Award Shares to the Grantee, that is equal in value to the withholding tax obligations (as described in Section 8(a)) that arise in connection with the vesting of the Grantee’s Award Shares and the related delivery of Award Shares to the Grantee.

(c)The Grantee agrees that if the Committee so directs and approves, and if the Grantee does not make adequate provision in cash for any

sums required to satisfy the federal, state, local and any other tax withholding, to a “same day sale” commitment with a broker-dealer of the Company’s choice that is a member of the Financial Industry Regulatory Authority (a “FINRA Dealer”) whereby the Grantee irrevocably agrees to sell a portion of the Award Shares to satisfy the withholding taxes and whereby the FINRA Dealer commits to forward the proceeds necessary to satisfy the withholding taxes directly to the Company. If, for any reason, such “same day sale” does not result in sufficient proceeds to satisfy the withholding taxes or would be prohibited by applicable laws at the applicable time, the Grantee hereby authorizes the Company and/or the relevant Subsidiary, or their respective agents, at their discretion, to satisfy the obligations with regard to all withholding taxes by one or a combination of the following: (i) withholding from any compensation otherwise payable to the Grantee by the Company or any Subsidiary; or (ii) causing the Grantee to tender a cash payment (which may be in the form of a check, electronic wire transfer or other method permitted by the Company). It is the Company’s intent that the mandatory sale to cover withholding taxes imposed by the Company on the Grantee in connection with the receipt of the Award Shares comply with the requirements of Rule 10b5-1(c)(1)(i)(B) under the Exchange Act and be interpreted to comply with the requirements of Rule 10b5-1(c).

In connection with a “same day sale,” the Grantee hereby acknowledges and agrees to the following:

(i)The Grantee hereby appoints such FINRA Dealer appointed by the Company for purposes of this Section 8(c) as the Grantee’s agent (the “Agent”), and authorize the Agent:

(A)To sell on the open market at the then prevailing market price(s), on the Grantee’s behalf, as soon as practicable on or after the date on which the Award Shares vest, the number (rounded to the nearest whole number (and 0.5 shall round to 1)) of the Award Shares sufficient to generate proceeds to cover (1) the withholding taxes that the Grantee is required to pay pursuant to the Plan and this Agreement and (2) all applicable fees and commissions due to, or required to be collected by, the Agent with respect thereto; and

(B)To remit any remaining funds to the Grantee.

(ii)The Grantee hereby authorizes the Company and the Agent to cooperate and communicate with one another to determine the number of Shares that must be sold pursuant to this Section 8(c).

(iii)The Grantee understands that the Agent may effect sales as provided in this Section 8(c) in one or more sales and that the average price for executions resulting from bunched orders will be

assigned to the Grantee’s account. In addition, the Grantee acknowledges that it may not be possible to sell Award Shares as provided in this Section 8(c) due to (A) a legal or contractual restriction applicable to the Grantee or the Agent, (B) a market disruption, or (C) rules governing order execution priority on the national exchange where the Common Stock may be traded. If the Agent is unable to sell a sufficient number of Award Shares to satisfy the withholding taxes, the Grantee will continue to be responsible for the timely payment to the Company of all withholding taxes and any other federal, state, local and other taxes that are required by applicable laws and regulations to be withheld, including but not limited to those amounts specified in this Section 8(c).

(iv)The Grantee acknowledges that regardless of any other term or condition of this Section 8(c), the Agent will not be liable to the Grantee for (A) special, indirect, punitive, exemplary or consequential damages, or incidental losses or damages of any kind, or (B) any failure to perform or for any delay in performance that results from a cause or circumstance that is beyond its reasonable control.

(v)The Grantee hereby agrees to execute and deliver to the Agent any other agreements or documents as the Agent reasonably deems necessary or appropriate to carry out the purposes and intent of this Section 8(c). The Agent is a third-party beneficiary of this Section 8(c).

(vi)The Grantee hereby agrees that if the Grantee has signed the Agreement when the Grantee is in possession of material non-public information, unless the Grantee informs the Company in writing within five business days following the date the Grantee ceases to be in possession of material non-public information that the Grantee is not in agreement with the provisions of this Section 8(c), the Grantee not providing such written determination shall be a determination and agreement that the Grantee has agreed to the provisions set forth in this Section 8(c) on such date as the Grantee has ceased to be in possession of material non-public information.

(vii)This Section 8(c) shall terminate not later than the date on which all withholding taxes arising in connection with the vesting of the Grantee’s Award Shares have been satisfied.

(d)Notwithstanding any action the Company takes with respect to any or all income tax, social insurance, payroll tax or other tax-related withholding (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and remains the Grantee’s responsibility, and the Company (i) makes no representation or undertakings regarding the treatment of any Tax-Related Items in connection with the award, vesting or delivery of the Award Shares or

the subsequent sale of any of the Award Shares; and (ii) does not commit to structure the Award Shares to reduce or eliminate the Grantee’s liability for Tax-Related Items.

(e)To the extent necessary to qualify for an exemption from application of Section 16(b) of the Exchange Act, if applicable, any share withholding or share sale procedure shall be subject to the prior approval of the Committee.

(f) The Grantee hereby acknowledges that the Company has advised the Grantee to seek independent tax advice from the Grantee’s own advisors regarding the availability and advisability of making an election under Section 83(b) of the Code, and that any such election, if made, must be made within 30 days of the Grant Date. The Grantee expressly acknowledges that the Grantee is solely responsible for filing any such Section 83(b) election with the appropriate governmental authorities, irrespective of the fact that such election is also delivered to the Company. The Grantee may not rely on the Company or any of its officers, directors or employees for tax or legal advice regarding this award. The Grantee acknowledges that the Grantee has sought tax and legal advice from the Grantee’s own advisors regarding this award or has voluntarily and knowingly foregone such consultation.

9. Rights as Stockholder. The Grantee will possess all incidents of ownership of the Award Shares, including the right to vote the Award Shares and to receive dividends; provided, however, that dividends payable with respect to Award Shares (if any) shall be subject to the same vesting conditions and restrictions applicable to such Award Shares and shall, if vested, be delivered or paid at the same time as such Award Shares.

10. Miscellaneous.

(a) This Agreement shall be construed, administered and governed in all respects under and by the applicable internal laws of the State of Georgia, without giving effect to the principles of conflicts of laws thereof. The Company and the Grantee further consent to the non-exclusive jurisdiction of the state and federal courts of the State of Georgia for purposes of any action arising out of or related to this Agreement.

(b) This Agreement and the Plan contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto. Except as provided below, this Agreement may not be modified, amended, supplemented or waived except by a writing signed by the parties hereto, and such writing must refer specifically to this Agreement.

(c) If any event described in Article X of the Plan occurs after the Grant Date, the adjustment provisions as provided for under Article X of the Plan shall apply to this Award.

(d)By signing this Agreement, the Grantee acknowledges that he or she has received a copy of the Plan and has had an opportunity to review the Plan and agrees to be bound by all the terms and provisions of the Plan.

(e)This Agreement, as amended from time to time, shall be binding upon, inure to the benefit of, and be enforceable by the heirs, successors and assigns of the parties hereto; provided, however, that this provision shall not permit any assignment in contravention of the terms contained elsewhere herein.

(f)Neither this Agreement nor the Plan shall be construed to constitute an agreement or understanding, expressed or implied, on the part of the Company or any Subsidiary to employ the Grantee for any specified period and shall not confer upon the Grantee the right to continue in the employment of the Company or any Subsidiary, nor affect any right which the Company or any Subsidiary may have to terminate the employment of the Grantee.

(g)This Agreement is subject to the Plan. The terms and provisions of the Plan as it may be amended from time to time are hereby incorporated herein by reference. In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail.

(h)Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the Chief Financial Officer of the Company at the Company’s principal corporate offices. Any notice required to be delivered to the Grantee under this Agreement shall be in writing and addressed to the Grantee at the Grantee’s address as shown in the records of the Company. Either party may designate another address in writing (or by such other method approved by the Company) from time to time.

(i)Any dispute regarding the interpretation of this Agreement shall be submitted by the Grantee or the Company to the Committee for review. The resolution of such dispute by the Committee shall be final and binding on the Grantee and the Company.

(j)The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Grantee and the Grantee’s beneficiaries, executors, administrators and the person(s) to whom the Award Shares may be transferred by will or the laws of descent or distribution.

(k)The invalidity or unenforceability of any provision (including any sentence, clause, phrase, or word) of the Plan or this Agreement (or of any applicable clawback policy or recoupment provisions referenced in Section 10(p) below) shall not render invalid, void or unenforceable any other part or provision of the Plan or this Agreement (or of any applicable clawback policy or recoupment provisions referenced in Section 10(p) below) (including, as an example and without limitation, the remainder of the provision that contains the invalid, void or unenforceable sentence, clause, phrase or word), but rather each provision of the Plan and this Agreement (and of any applicable clawback policy or recoupment provisions referenced in Section 10(p) below) shall be severable and enforceable to the extent permitted by law.

(l)This Agreement is intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and interpreted in a manner that is consistent with the requirements for avoiding additional taxes or penalties under Section 409A of the Code. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Agreement comply with Section 409A of the Code and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Grantee on account of non-compliance with Section 409A of the Code or any similar state statute, law or regulation.

(m)The value of the Grantee’s Award Shares is not part of the Grantee’s normal or expected compensation for purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit plan (“EB Plan”) unless otherwise provided by such EB Plan.

(n)This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.

(o)The Company reserves the right to amend the terms of this Agreement as may be necessary or appropriate to avoid adverse tax consequences under Section 409A of the Code or to comply with any requirements under (i) any Company clawback or recoupment policy regarding incentive compensation (any such policy, including such a policy that may be adopted to address a specific situation before or after the situation occurs and any policy that provides for forfeiture, ineligibility, reduction or

elimination, as a result of misconduct, with respect to the amount of incentive compensation that would otherwise be paid or delivered, is referred to as a “clawback policy”) that is in effect as of the date of this Agreement or that may hereafter be adopted by the Company or the Committee or (ii) any “clawback” requirements under the Sarbanes–Oxley Act of 2002 or the Dodd-Frank Wall Street Reform and Consumer Protection Act to which the Company may be subject.

(p)The Grantee agrees that the Award Shares (and any proceeds from the sale or disposition thereof), shall, to the fullest extent permitted by applicable law, be subject to any clawback or recoupment provisions (and to any provisions that provide for a forfeiture, ineligibility, reduction or elimination, as a result of misconduct, with respect to incentive compensation that would otherwise be paid or delivered) contained in: (x) the Plan; or (y) any clawback policy or recoupment provision that is in effect as of the date of this Agreement or that is hereafter adopted by the Company or the Committee, in each case as and to the extent set forth in any such clawback policy or recoupment provision (or any such provisions that provide for forfeiture, ineligibility, reduction or elimination, as a result of misconduct, with respect to incentive compensation that would otherwise be paid or delivered). By accepting this Agreement, the Grantee agrees to return to the Company the full amount required by any such clawback policy or any such clawback or recoupment provisions (and agrees to any such provisions that provide for forfeiture, ineligibility, reduction or elimination, as a result of misconduct, with respect to the amount of incentive compensation that would otherwise be paid or delivered) that are or hereafter become applicable to the Grantee.

(q)The Grantee hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Grantee’s personal data as described in this Agreement and any other Award materials by and among the Company and its affiliates for the purpose of implementing, administering and managing the Grantee’s participation in the Plan. The Grantee understands that the Company may hold certain personal information about the Grantee, including, but not limited to, the Grantee’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or directorships held in the Company, details of all Awards, or any other entitlement to Shares awarded, canceled, exercised, vested, unvested or outstanding in the Grantee’s favor (“Data”), for the purpose of implementing, administering and managing the Plan. The Grantee understands that Data will be transferred to such stock plan service provider as may be selected by the Company, presently or in the future, which may be assisting the Company with the implementation, administration and management of the Plan. The Grantee understands that the recipients of the Data may be located in the United States or elsewhere, and that the recipient’s country (e.g., the United States) may have different data

privacy laws and protections than the Grantee’s country. The Grantee authorizes the Company, the stock plan service provider as may be selected by the Company, and any other possible recipients which may assist the Company, presently or in the future, with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Grantee’s participation in the Plan. Further, the Grantee understands that he or she is providing the consents herein on a purely voluntary basis. If the Grantee does not consent, or if the Grantee later seeks to revoke his or her consent, or instructs the Company to cease the processing of the Data, his or her employment status will not be adversely affected; the only adverse consequence of refusing or withdrawing the Grantee’s consent or instructing the Company to cease processing, is that the Company would not be able to grant Award Shares or any other Awards to the Grantee or administer or maintain such Awards. Therefore, the Grantee understands that refusing or withdrawing his or her consent may affect the Grantee’s ability to participate in the Plan. For more information on the consequences of the Grantee’s refusal to consent or withdrawal of consent, the Grantee understands that he or she may contact the Company’s human resources representative.

(r)The Company reserves the right to impose other requirements on the Grantee’s participation in the Plan and on the Award Shares to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Grantee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing. The Grantee also acknowledges that the applicable laws of the country in which the Grantee is residing or working at the time of grant, vesting and delivery of the Award Shares (including any rules or regulations governing securities, foreign exchange, tax, labor, or other matters) may subject the Grantee to additional procedural or regulatory requirements that the Grantee is and will be solely responsible for and must fulfill.

[Signatures appear on following page]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set forth above.

ALIMERA SCIENCES, INC.

By:

Name:

Title:

The Grantee

{This Stock Power should be signed in blank and deposited with the Company if share certificates are issued and/or delivered to the Grantee for Award Shares not yet released from restrictions.}

STOCK POWER

FOR VALUE RECEIVED, the undersigned, _____________________, hereby sells, assigns and transfers unto Alimera Sciences, Inc., a Delaware corporation (the “Company”), or its successor, ________ shares of common stock, par value $.01 per share, of the Company standing in my name on the books of the Company, represented by Certificate No. ____________, or an appropriate book entry notation, and hereby irrevocably constitutes and appoints the Corporate Secretary of the Company as my attorney-in-fact to transfer the said stock on the books of the Company with full power of substitution in the premises. This Stock Power may only be used in connection with the forfeiture or withholding of Award Shares pursuant to that certain Restricted Stock Agreement between the undersigned and the Company dated [date].



WITNESS:


		Signature of Grantee



		Please print name


		Dated:

IMPORTANT FEDERAL TAX INFORMATION

INSTRUCTIONS REGARDING SECTION 83(b) ELECTIONS


1.	The 83(b) Election is irrevocable. The 83(b) Election is a voluntary election that is available to you. It is your decision whether to file an 83(b) Election.

If you choose to make an 83(b) Election, the 83(b) Election Form must be filed with the Internal Revenue Service within 30 days of the Grant Date; no exceptions to this deadline are made. You should send the election to the Internal Revenue Service center located at the address to which you send your federal income tax return (IRS Form 1040) based on your place of residence. The election should be sent via certified mail with return receipt requested or a delivery service that provides proof of delivery.

You must deliver a copy of the 83(b) Election Form to the Corporate Secretary or other designated officer of the Company as soon as practicable after you receive proof that the original was received by the Internal Revenue Service. Irrespective of the fact that a copy of your 83(b) Election Form is to be delivered to the Company, you remain solely responsible for properly filing the original with the Internal Revenue Service.


4.	In addition to making the filing under Item 2 above, you must attach a copy of your 83(b) Election Form to your federal tax return for the taxable year that includes the Grant Date. Applicable state law also may require you to attach a copy of the 83(b) Election Form to any state income tax returns that you file for that taxable year.


5.	If you make an 83(b) Election and later forfeit the Award Shares, you will not be entitled to a refund of the taxes paid with respect to the gross income you recognized under the 83(b) Election.

You must consult your personal tax advisor before making an 83(b) Election. You may not rely on this information, the Company, or any of the Company’s officers, directors, or employees for tax or legal advice regarding the Award Shares or the 83(b) Election. The election form attached to these instructions is intended as a sample only. It must be tailored to your circumstances and may not be relied upon without consultation with a personal tax advisor.

SECTION 83(b) ELECTION FORM

Election Pursuant to Section 83(b) of the Internal Revenue Code to
Include Property in Gross Income in Year of Transfer

The undersigned hereby makes an election pursuant to Section 83(b) of the Internal Revenue Code with respect to the property described below and supplies the following information in accordance with the regulations promulgated thereunder:

1. The name, address, and taxpayer identification number of the undersigned are:

______________________________

Social Security Number: ___-__-____

2. The property with respect to which the election is made is ________ shares of Stock, par value $0.01 per share, of Alimera Sciences, Inc., a Delaware corporation (the “Company”).

3. The date on which the property was transferred was ___________, the date on which the taxpayer received the property pursuant to a grant of restricted stock (the “Grant Date”).

4. The taxable year to which this election relates is calendar year _____.

5. The property is subject to restrictions in that the property is not transferable and is subject to a substantial risk of forfeiture until the taxpayer is vested. The restrictions will lapse, in whole or in part, on the first anniversary of the Grant Date, provided that the taxpayer is continuously providing services to the Company through that date, or incurs a death, disability or retirement prior to such date. The restrictions will also lapse upon an earlier change in control of the Company.

6. The fair market value at the time of transfer (determined without regard to any restrictions other than restrictions which by their terms will never lapse) of the property with respect to which this election is being made is $ per share; with a cumulative fair market value of $ .

7. The taxpayer did not pay any amount for the property transferred.

8. A copy of this statement was furnished to the Corporate Secretary or other designated officer of the Company. The taxpayer rendered the services to the Company in connection with the transfer of the property with respect to which this election is being made.

9. This election is made to the same effect, and with the same limitations, for purposes of any applicable state statute corresponding to Section 83(b) of the Internal Revenue Code.

The undersigned understands that the foregoing election may not be revoked except with the consent of the Commissioner of Internal Revenue.

Signed:

Date:

Letter for filing §83(b) Election Form

Date:________________

CERTIFIED MAIL

RETURN RECEIPT REQUESTED

***Please insert the IRS Service Center where you file your federal income tax return below.***

Internal Revenue Service Center

Re: 83(b) Election of

Social Security Number:

Dear Sir/Madam:

Enclosed is an election under §83(b) of the Internal Revenue Code of 1986, as amended, with respect to certain shares of stock of Alimera Sciences, Inc. that were transferred to me on .

Please file this election.

Sincerely,

_________________________________

cc: Corporate Secretary of Alimera Sciences, Inc.

Exhibit 10.5.D

ALIMERA SCIENCES, INC.

RESTRICTED STOCK UNIT AGREEMENT

(time-based)

THIS RESTRICTED STOCK UNIT AGREEMENT (the “Agreement”) is made and entered into as of the date set forth in Section 2 below (the “Grant Date”) by and between Alimera Sciences, Inc., a Delaware corporation (the “Company”), and the grantee named in Section 2 below (the “Participant”). Capitalized terms in this Agreement that are not otherwise defined shall have the same meaning as set forth in the Company’s 2019 Omnibus Incentive Plan (as amended from time to time, the “Plan”).

1.Purpose. The purpose of this Agreement is to reflect the terms and conditions of the award to the Participant of restricted stock units (the “Restricted Stock Units” or “RSUs”) in consideration of the services to be rendered by the Participant to the Company or any Subsidiaries.

2.Award of Restricted Stock Units. Pursuant to Article VIII of the Plan, Participant is awarded an Award of RSUs, subject to the following and the terms and conditions of this Agreement and the Plan:

Name of Participant:___________________________________________

Total RSUs awarded:___________________________________________

Grant Date:___________________________________________________

Each Restricted Stock Unit represents the right to receive one share of Common Stock pursuant to the terms of the Plan and this Agreement.

3.Vesting Conditions.

(a)Vesting Schedule. The RSUs shall vest as follows (each such date being a “Vesting Date”):

______________________________________________________________________________

(b)Employment Condition. Subject to any exceptions set forth in Section 4 and Section 5 below, no RSUs may be settled and delivered to a Participant (i) before the applicable Vesting Date, and (y) if the Participant is not an active employee of the Company or any Subsidiary of the Company on the applicable Vesting Date (the “Employment Condition”).

(c)Vesting of Whole RSUs. All RSUs that are entitled to settlement and delivery will be rounded to the nearest whole number (and 0.5 shall round to 1).

(d)Separate Payment. Each tranche of Restricted Stock Units that vests, or is scheduled to vest, pursuant to this Agreement is hereby designated as a “separate payment” for purposes of Treasury Regulation Section 1.409A-2(b)(2).

4.Accelerated Vesting.

(a)Acceleration Upon Change in Control. If a Change in Control occurs after the Grant Date and prior to the Participant’s termination of employment with the Company, 100% of the outstanding RSUs shall be vested; provided that notwithstanding anything else contained in this Section 4(a) to the contrary, except as set forth in the final sentence of Section 4(b), in no event shall the RSUs be accelerated to an extent or in a manner which would not be fully deductible by the Company for federal income tax purposes because of Section 280G of the Code.

(b)Change in Control Adjustment. If a Change in Control occurs after the Grant Date and if the Participant is entitled under any agreement or arrangement to receive compensation that would constitute a parachute payment (including the acceleration of rights to settlement and delivery (vesting) of RSUs under this Agreement and any other equity award agreement with the Company) within the meaning of Section 280G of the Code, the acceleration of any vesting under Section 4(a) shall be cancelled or other CIC Payments (as defined below) shall be reduced to the extent necessary to cause the aggregate present value of all payments in the nature of compensation to the Participant that are contingent on a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company (the “CIC Payments”) not to exceed 2.99 times the “base amount,” all within the meaning of Section 280G of the Code. Such cancellation of vesting or other reductions in CIC Payments shall be made, in all cases: (i) if and to the extent not already provided, accelerated, granted or paid, as applicable, on account of other CIC Payments prior to the date of such cancellation, (ii) only to the least extent necessary so that no portion of the CIC Payments after such cancellation or reduction thereof shall be subject to the excise tax imposed by Section 4999 of the Code, and (iii) in a manner that results in the best economic benefit to the Participant (in applying these principles, any cancellation of vesting or other reduction in CIC Payments shall be made in a manner consistent with the requirements of Section 409A of the Code, and where Tax Counsel (as defined below) determines that two economically equivalent amounts are subject to reduction but payable at different times, such amounts shall be reduced on a pro rata basis but not below zero). All determinations required to be made under this Section 4(b), and the assumptions to be utilized in arriving at such determinations, shall be made by “Tax Counsel” (which shall be a law firm, compensation consultant or accounting firm appointed by the Company), which shall provide its determinations and any supporting calculations to the Company within 10 business days of having made such determination. Tax Counsel shall consult with any compensation consultant, accounting firm and/or other legal counsel selected by the Company in determining which payments to, or for the benefit of, the Participant are to be deemed to be CIC Payments. In connection with

making determinations under this Section 4(b), Tax Counsel shall take into account, to the extent applicable, the value of any reasonable compensation for services to be rendered (or for refraining from performing services) by the Participant before or after the Change in Control.

Notwithstanding the foregoing, if the Participant is a party to an employment or other agreement with the Company, or is a participant in a severance program sponsored by the Company, that contains express provisions regarding Section 280G and/or Section 4999 of the Code (or any similar successor provision) that apply to this Agreement, the Section 280G and/or Section 4999 provisions of such employment or other agreement or plan, as applicable, shall control as to this Agreement (for example, and without limitation, the Participant may be a party to an employment agreement with the Company that provides for a “gross-up” as opposed to a “cut-back” in the event that the Section 280G thresholds are reached or exceeded in connection with a Change in Control and, in such event, the Section 280G and/or Section 4999 provisions of such employment agreement shall control as to this Agreement).

(c)Pro-Rata Vesting Upon Termination of Employment Due to Disability, Death or Retirement on or Prior to the Applicable Vesting Date. If the Participant ceases to be employed by the Company or a Subsidiary as a result of the Participant’s Disability, death or Retirement on or prior to the applicable Vesting Date, the following rules shall apply and shall be an exception to the Employment Condition. The number of RSUs, if any, that shall become entitled to settlement and delivery on the applicable Vesting Date (or, if earlier, the date of such earlier Change in Control pursuant to Sections 4(a) and (b)) shall be (A) the same number, if any, to which the Participant would have been entitled under Section 3(a), or with respect to a Change in Control, Sections 4(a) and 4(b), if the Participant’s employment had not terminated, multiplied by (B) a fraction, the numerator of which shall be the number of whole months since the Grant Date that the Participant was employed by the Company or a Subsidiary, and the denominator of which shall be the total number of months from the Grant Date until the date that all RSUs granted hereunder are scheduled to have vested. RSUs subject to this Section 4(c) that do not become vested as of the applicable Vesting Date shall be cancelled and forfeited.

(d)Definitions. For purposes of this Agreement, “Disability” means either (a) that the Participant has met the definition of “Disability” under the Company’s Group Long Term Disability Insurance and has qualified to commence a disability benefit under such insurance, or (b) if the Participant is not covered by such insurance, a permanent and total disability (within the meaning of Section 22(e)(3) of the Code or as otherwise determined by the Committee). For purposes of this Agreement, “Retirement” means a termination of employment by the Participant that occurs upon or after both (a) the Participant’s attainment of age 55 and (b) when Participant’s years of service to the Company and its Subsidiaries (such years of service determined in accordance with the rules for determining years of service under the Company’s 401(k) Plan) is at least 10. For purposes of this Agreement, “Change in Control” means a Change in Control as defined in the Plan that occurs after the Grant

Date and that constitutes a “change in control event” with respect to the Participant as defined in the United States Treasury Regulations Section 1.409A-3(i)(5).

5.Forfeiture. Except to the extent otherwise expressly provided in Section 4, if the Participant’s employment with the Company and its Subsidiaries terminates before the applicable Vesting Date, all the unvested RSUs under this Agreement shall be cancelled and forfeited. All RSUs, and any shares of Common Stock issued hereunder (and any proceeds from the sale or disposition thereof), are subject to repayment, recoupment, clawback, forfeiture, ineligibility, reduction and/or elimination as set forth in Section 10(p) below.

6.Nonassignability. Subject to any exceptions set forth in this Agreement or the Plan, during the period from the Grant Date and until the RSUs are settled in accordance with Section 8 of this Agreement, the RSUs or the rights relating thereto may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Participant. Any attempt to assign, alienate, pledge, attach, sell or otherwise transfer or encumber the RSUs or the rights relating thereto shall be wholly ineffective and, if any such attempt is made, the RSUs will be forfeited by the Participant and all of the Participant’s rights to such units shall immediately terminate without any payment or consideration by the Company.

7.Rights as Stockholder.

(a)The Participant shall not have any rights of a stockholder with respect to the RSUs or the shares of Common Stock underlying the RSUs (including, without limitation, any voting rights or any right to dividends paid with respect to the shares of Common Stock underlying the RSUs) unless and until the RSUs are settled in a specified number of shares in accordance with Section 8 below.

(b)Upon and following the settlement of the RSUs, the Participant shall be the record owner of the shares of Common Stock underlying the RSUs unless and until such shares are sold or otherwise disposed of, and as record owner shall be entitled to all rights of a stockholder of the Company (including voting rights).

8.Settlement of RSUs. Outstanding RSUs that become entitled to settlement and delivery will be paid in an equivalent number of shares of Common Stock (either by delivering one or more certificates for such shares or by entering such shares in book entry form, as determined by the Company in its discretion) no later than five (5) days after the applicable date upon which they become entitled to settlement and delivery (as set forth in Sections 3 and 4 above) with respect to such RSUs, and such payment shall be in complete satisfaction of such RSUs. Delivery of any certificates will be made to the Participant’s last address reflected on the books of the Company or its Subsidiaries unless the Company is otherwise instructed in writing. Notwithstanding the foregoing, the Company shall have the discretion to settle the RSUs prior to the time set forth herein to the extent permitted by Treasury Regulation Section 1.409A-3(j)(4). Notwithstanding anything to the contrary in the

Plan or this Agreement, it will not be a violation of the Plan or this Agreement (and the Participant will have no right to damages) if the Company delivers the appropriate number of shares of Common Stock (either by delivering one or more certificates for such shares or by entering such shares in book entry form, as determined by the Company in its discretion) during the “short-term deferral” period as described in Treasury Regulation Section 1.409A-1(b)(4)(i).

9.Tax Liability and Withholding.

(a)The Participant shall be required to pay to the Company, and the Company shall have the right to deduct from any compensation paid to the Participant pursuant to the Plan (including, for the avoidance of doubt, by withholding vested shares of Common Stock deliverable upon vesting of the RSUs (“Shares”)), the amount required to satisfy the federal, state, local and any other tax withholding obligations of the Company or any Subsidiary that arise in connection with the Participant’s RSUs. Consistent with the terms of Section 13.3 of the Plan, if the Participant fails to make such tax payments as required, the Company shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to the Participant all federal, state and local taxes of any kind required by law to be withheld with respect to the Shares.

(b)Unless the Committee directs the Company to sell a portion of the Shares to satisfy the withholding taxes as provided in Section 9(c), the Company shall deduct and withhold the number of Shares, valued at the Fair Market Value of the Shares on the date of delivery of the Shares to the Participant, that is equal in value to the withholding tax obligations (as described in Section 9(a)) that arise in connection with the vesting of the Participant’s RSUs and the related delivery of Shares to the Participant.

(c)The Participant agrees that if the Committee so directs and approves, and if the Participant does not make adequate provision in cash for any sums required to satisfy the federal, state, local and any other tax withholding, to a “same day sale” commitment with a broker-dealer of the Company’s choice that is a member of the Financial Industry Regulatory Authority (a “FINRA Dealer”) whereby the Participant irrevocably agrees to sell a portion of the Shares to satisfy the withholding taxes and whereby the FINRA Dealer commits to forward the proceeds necessary to satisfy the withholding taxes directly to the Company. If, for any reason, such “same day sale” does not result in sufficient proceeds to satisfy the withholding taxes or would be prohibited by applicable laws at the applicable time, the Participant hereby authorizes the Company and/or the relevant Subsidiary, or their respective agents, at their discretion, to satisfy the obligations with regard to all withholding taxes by one or a combination of the following: (i) withholding from any compensation otherwise payable to the Participant by the Company or any Subsidiary; or (ii) causing the Participant to tender a cash payment (which may be in the form of a check, electronic wire transfer or other method permitted by the Company). It is the Company’s intent

that the mandatory sale to cover withholding taxes imposed by the Company on the Participant in connection with the receipt of this Award comply with the requirements of Rule 10b5-1(c)(1)(i)(B) under the Exchange Act and be interpreted to comply with the requirements of Rule 10b5-1(c).

In connection with a “same day sale,” the Participant hereby acknowledges and agrees to the following:

(i)The Participant hereby appoints such FINRA Dealer appointed by the Company for purposes of this Section 9(c) as the Participant’s agent (the “Agent”), and authorize the Agent:

(A)To sell on the open market at the then prevailing market price(s), on the Participant’s behalf, as soon as practicable on or after each date on which the Shares vest, the number (rounded to the nearest whole number (and 0.5 shall round to 1)) of the Shares sufficient to generate proceeds to cover (A) the withholding taxes that the Participant is required to pay pursuant to the Plan and this Agreement and (B) all applicable fees and commissions due to, or required to be collected by, the Agent with respect thereto; and

(B)To remit any remaining funds to the Participant.

(ii)The Participant hereby authorizes the Company and the Agent to cooperate and communicate with one another to determine the number of Shares that must be sold pursuant to this Section 9(c).

(iii)The Participant understands that the Agent may effect sales as provided in this Section 9(c) in one or more sales and that the average price for executions resulting from bunched orders will be assigned to the Participant’s account. In addition, the Participant acknowledges that it may not be possible to sell Shares as provided by in this Section (9(c) due to (A) a legal or contractual restriction applicable to the Participant or the Agent, (B) a market disruption, or (C) rules governing order execution priority on the national exchange where the Shares may be traded. If the Agent is unable to sell a sufficient number of Shares to satisfy the withholding taxes, the Participant will continue to be responsible for the timely payment to the Company of all withholding taxes and any other federal, state and local taxes that are required by applicable laws and regulations to be withheld, including but not limited to those amounts specified in this Section (9(c).

(iv)The Participant acknowledges that regardless of any other term or condition of this Section (9(c), the Agent will not be liable to the Participant for (A) special, indirect, punitive, exemplary or consequential damages, or incidental losses or damages of any kind, or (B) any failure to perform or for any delay in performance that results from a cause or circumstance that is beyond its reasonable control.

(v)The Participant hereby agrees to execute and deliver to the Agent any other agreements or documents as the Agent reasonably deems necessary or appropriate to carry out the purposes and intent of this Section (9(c). The Agent is a third-party beneficiary of this Section (9(c).

(vi)The Participant hereby agrees that if the Participant has signed the Agreement when the Participant is in possession of material non-public information, unless the Participant informs the Company in writing within five business days following the date the Participant ceases to be in possession of material non-public information that the Participant is not in agreement with the provisions of this Section (9(c), the Participant not providing such written determination shall be a determination and agreement that the Participant has agreed to the provisions set forth in this Section (9(c) on such date as the Participant has ceased to be in possession of material non-public information.

(vii)This Section (9(c) shall terminate not later than the date on which all withholding taxes arising in connection with the vesting of the Participant’s RSUs have been satisfied.

(d)Notwithstanding any action the Company takes with respect to any or all income tax, social insurance, payroll tax or other tax-related withholding (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and remains the Participant’s responsibility, and the Company (i) makes no representation or undertakings regarding the treatment of any Tax-Related Items in connection with the award, vesting or settlement of the RSUs or the subsequent sale of any Shares; and (ii) does not commit to structure the RSUs to reduce or eliminate the Participant’s liability for Tax-Related Items.

10.Miscellaneous.

(a)This Agreement shall be construed, administered and governed in all respects under and by the applicable internal laws of the State of Georgia, without giving effect to the principles of conflicts of laws thereof. The Company and the Participant further consent to the non-exclusive jurisdiction of the state and federal courts of the State of Georgia for purposes of any action arising out of or related to this Agreement.

thereto. Except as provided below, this Agreement may not be modified, amended, supplemented or waived except by a writing signed by the parties hereto, and such writing must refer specifically to this Agreement.

(c)If any event described in Article X of the Plan occurs after the Grant Date, the adjustment provisions as provided for under Article X of the Plan shall apply to this Award.

(d)By signing this Agreement, the Participant acknowledges that he or she has received a copy of the Plan and has had an opportunity to review the Plan and agrees to be bound by all the terms and provisions of the Plan.

(f)Neither this Agreement nor the Plan shall be construed to constitute an agreement or understanding, expressed or implied, on the part of the Company or any subsidiary to employ the Participant for any specified period and shall not confer upon the Participant the right to continue in the employment of the Company or any subsidiary, nor affect any right which the Company or any subsidiary may have to terminate the employment of the Participant.

(h)Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the Chief Financial Officer of the Company at the Company’s principal corporate offices. Any notice required to be delivered to the Participant under this Agreement shall be in writing and addressed to the Participant at the Participant’s address as shown in the records of the Company. Either party may designate another address in writing (or by such other method approved by the Company) from time to time.

(i)Any dispute regarding the interpretation of this Agreement shall be submitted by the Participant or the Company to the Committee for review. The resolution of such dispute by the Committee shall be final and binding on the Participant and the Company.

(j)The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns

of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant’s beneficiaries, executors, administrators and the person(s) to whom the RSUs may be transferred by will or the laws of descent or distribution.

(l)This Agreement is intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and interpreted in a manner that is consistent with the requirements for avoiding additional taxes or penalties under Section 409A of the Code. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Agreement comply with Section 409A of the Code and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A of the Code or any similar state statute, law or regulation.

(m)The value of the Participant’s RSUs is not part of the Participant’s normal or expected compensation for purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit plan (“EB Plan”) unless otherwise provided by such EB Plan.

after the situation occurs and any policy that provides for forfeiture, ineligibility, reduction or elimination, as a result of misconduct, with respect to the amount of incentive compensation that would otherwise be paid or delivered, is referred to as a “clawback policy”) that is in effect as of the date of this Agreement or that may hereafter be adopted by the Company or the Committee or (ii) any “clawback” requirements under the Sarbanes-Oxley Act of 2002 or the Dodd-Frank Wall Street Reform and Consumer Protection Act to which the Company may be subject.

(p)The Participant agrees that (i) these RSUs and (ii) any shares of Common Stock issued hereunder (and any proceeds from the sale or disposition thereof), shall, to the fullest extent permitted by applicable law, be subject to any clawback or recoupment provisions (and to any provisions that provide for a forfeiture, ineligibility, reduction or elimination, as a result of misconduct, with respect to incentive compensation that would otherwise be paid or delivered) contained in: (x) the Plan; (y) any written incentive plan applicable these RSUs or shares of Common Stock issued hereunder (or proceeds from the sale or disposition thereof); or (z) any clawback policy or recoupment provision that is in effect as of the date of this Agreement or that is hereafter adopted by the Company or the Committee, in each case as and to the extent set forth in any such clawback policy or recoupment provision (or any such provisions that provide for forfeiture, ineligibility, reduction or elimination, as a result of misconduct, with respect to incentive compensation that would otherwise be paid or delivered). By accepting this Agreement, the Participant agrees to return to the Company the full amount required by any such clawback policy or any such clawback or recoupment provisions (and agrees to any such provisions that provide for forfeiture, ineligibility, reduction or elimination, as a result of misconduct, with respect to the amount of incentive compensation that would otherwise be paid or delivered) that are or hereafter become applicable to the Participant.

(q)The Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Participant’s personal data as described in this Agreement and any other Award materials by and among the Company and its affiliates for the purpose of implementing, administering and managing the Participant’s participation in the Plan. The Participant understands that the Company may hold certain personal information about the Participant, including, but not limited to, the Participant’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or directorships held in the Company, details of all Awards, or any other entitlement to Shares awarded, canceled, exercised, vested, unvested or outstanding in the Participant’s favor (“Data”), for the purpose of implementing, administering and managing the Plan. The Participant understands that Data will be transferred to such stock plan service provider as may be selected by the Company, presently or in the future, which may be assisting the Company with the implementation, administration and management of the Plan. The Participant understands that the recipients of the Data may be located in the United States or

elsewhere, and that the recipient’s country (e.g., the United States) may have different data privacy laws and protections than the Participant’s country. The Participant authorizes the Company, the stock plan service provider as may be selected by the Company, and any other possible recipients which may assist the Company, presently or in the future, with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Participant’s participation in the Plan. Further, the Participant understands that he or she is providing the consents herein on a purely voluntary basis. If the Participant does not consent, or if the Participant later seeks to revoke his or her consent, or instructs the Company to cease the processing of the Data, his or her employment status will not be adversely affected; the only adverse consequence of refusing or withdrawing the Participant’s consent or instructing the Company to cease processing, is that the Company would not be able to grant the Participant Restricted Stock Units or any other equity awards or administer or maintain such awards. Therefore, the Participant understands that refusing or withdrawing his or her consent may affect the Participant’s ability to participate in the Plan. For more information on the consequences of the Participant’s refusal to consent or withdrawal of consent, the Participant understands that he or she may contact the Company’s human resources representative.

(r)The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on the Restricted Stock Units and on any Shares allocated to the RSUs, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Participant to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing. The Participant also acknowledges that the applicable laws of the country in which the Participant is residing or working at the time of grant, vesting and settlement of the Restricted Stock Units or the sale of Shares received pursuant to the Restricted Stock Units (including any rules or regulations governing securities, foreign exchange, tax, labor, or other matters) may subject the Participant to additional procedural or regulatory requirements that the Participant is and will be solely responsible for and must fulfill.

[Signatures appear on following page.]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set forth above.

ALIMERA SCIENCES, INC.

By:

Name:

Title:

The Participant

EXHIBIT 31.1

CERTIFICATION

I, Richard S. Eiswirth, Jr., certify that:



1.		I have reviewed this Quarterly Report on Form 10-Q of Alimera Sciences, Inc.;

2.		Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.		Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.		The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:



	a.		designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	b.		designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	c.		evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	d.		disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and



5.		The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):



	a.	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

	b.	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 6, 2020			/s/ Richard S. Eiswirth, Jr.
			Richard S. Eiswirth, Jr.
			President and Chief Executive Officer (Principal Executive Officer)

EXHIBIT 31.2

CERTIFICATION

I, J. Philip Jones, certify that:



1.		I have reviewed this Quarterly Report on Form 10-Q of Alimera Sciences, Inc.;

2.		Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.		Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.		The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:



	a.		designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	b.		designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	c.		evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	d.		disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and



5.		The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):



	a.	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

	b.	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 6, 2020			/s/ J. Philip Jones
			J. Philip Jones
			Chief Financial Officer (Principal Financial and Accounting Officer)

EXHIBIT 32.1

Certification

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code)

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code), each of the undersigned officers of Alimera Sciences, Inc. (the Company), does hereby certify, to the best of such officer’s knowledge, that:

The Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 (the Form 10-Q) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.



Date: May 6, 2020	/s/ Richard S. Eiswirth, Jr.
	Richard S. Eiswirth, Jr.
	President and Chief Executive Officer (Principal Executive Officer)

Date: May 6, 2020	/s/ J. Philip Jones
	J. Philip Jones
	Chief Financial Officer (Principal Financial and Accounting Officer)

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. This certification “accompanies” the Form 10-Q to which it relates, is not deemed filed with the SEC and is not to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.

LEASES - Finance Lease Supplemental Balance Sheet Information (Details) - USD ($)
$ in Thousands

REVENUE RECOGNITION - Narrative (Details)
$ in Millions

STOCK INCENTIVE PLANS

STOCK INCENTIVE PLANS

Stock Option Plans



	Three Months Ended March 31,
	2020			2019
	Options		Weighted Average Exercise Price ($)	Options		Weighted Average Exercise Price ($)
Options outstanding at beginning of period	871,472		35.46	830,100		39.41
Grants	168,850		6.75	78,324		13.10
Forfeitures	(3,838	)	20.99	(14,318	)	29.92
Exercises	—		—	—		—
Options outstanding at period end	1,036,484		30.84	894,106		37.25
Options exercisable at period end	707,763		40.00	636,028		45.22
Weighted average per share fair value of options granted during the period	$4.18			$8.21

The following table provides additional information related to outstanding stock options, exercisable stock options and stock options that were expected to vest as of March 31, 2020:



	Shares	Weighted Average Exercise Price ($)	Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value ($)
				(In thousands)
Outstanding	1,036,484	30.84	4.97 years	9
Exercisable	707,763	40.00	4.97 years	9
Outstanding, vested and expected to vest	989,943	31.83	6.12 years	99

The following table provides additional information related to outstanding stock options, exercisable stock options and stock options that were expected to vest as of December 31, 2019:



	Shares	Weighted Average Exercise Price ($)	Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value ($)
				(In thousands)
Outstanding	871,472	35.46	5.83 years	4,043
Exercisable	674,952	41.25	5.04 years	13
Outstanding, vested and expected to vest	849,285	36.00	5.75 years	3,324

As of March 31, 2020, 265,625 shares remain available for grant under the 2019 Omnibus Incentive Plan.

Employee Stock Purchase Plan

During the three months ended March 31, 2020 and 2019, the Company recorded compensation expense related to its employee stock purchase plan of approximately $21,000 and $6,000, respectively.

Restricted Stock and Restricted Stock Units

A summary of restricted stock and restricted stock units (RSU) transactions under the plans are as follows:



	Three Months Ended March 31,
	2020			2019
	Restricted Stock & RSUs		Weighted Average Grant Date Fair Value ($)	Restricted Stock & RSUs		Weighted Average Grant Date Fair Value ($)
Restricted stock & RSUs outstanding at beginning of period	36,763		13.15	60,041		17.30
Grants	30,086		3.12	32,029		12.90
Vested units	(36,763	)	13.15	(59,341	)	17.30
Forfeitures	—		—	(700	)	17.40
Restricted stock & RSUs outstanding at period end	30,086		3.12	32,029		12.90

REVENUE RECOGNITION

REVENUE RECOGNITION

Net Revenue

Estimates of Variable Consideration

Consideration Payable to Customers

Product Returns

Other Revenue

Customer Payment Obligations

INTANGIBLE ASSET

INTANGIBLE ASSET

As a result of the approval of ILUVIEN by the U.S. Food and Drug Administration (FDA) in 2014, the Company was required to pay EyePoint a milestone payment of $25,000,000 (see Note 9).

The estimated future amortization expense as of March 31, 2020 for the remaining periods in the next five years and thereafter is as follows:



Years Ending December 31	(In thousands)
2020	$	1,462
2021	1,940
2022	1,940
2023	1,940
2024	1,946
Thereafter	5,071
Total	$	14,299

Property and equipment and definite lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When indicators of impairment are present, the Company evaluates the carrying amount of such assets in relation to the operating performance and future estimated undiscounted net cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. The assessment of the recoverability of assets will be impacted if estimated future operating cash flows are not achieved.

INCOME TAXES - Narrative (Detail) - USD ($)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands

LOAN AGREEMENTS - Solar Capital Loan Agreement Narrative (Details) - Solar Capital Ltd. - USD ($)

LICENSE AGREEMENTS - Narrative (Details) - USD ($)

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)
$ in Thousands

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Policies)

BASIS OF PRESENTATION

Accounting Standards Issued but Not Yet Effective

Net Revenue

Estimates of Variable Consideration

Consideration Payable to Customers

Product Returns

Other Revenue

Customer Payment Obligations

EARNINGS (LOSS) PER SHARE (EPS) - (Tables)



	Three Months Ended March 31,
	2020	2019
Series A convertible preferred stock	601,504	601,504
Series C convertible preferred stock	676,667	676,667
Common stock warrants	119,712	119,712
Stock options	1,036,484	894,097
Restricted stock units	30,086	32,029
Total	2,464,453	2,324,009

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIT) EQUITY - USD ($)
$ in Thousands

Series A Convertible Preferred Stock

Series C Convertible Preferred Stock

Additional Paid-In Capital

Common Stock Warrants

Accumulated Other Comprehensive Loss

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

EARNINGS (LOSS) PER SHARE (EPS) - Narrative (Details)

LOAN AGREEMENTS - Hercules Loan Agreement Narrative (Details)

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

$1.8 Million Loan under the Paycheck Protection Program

The interest rate on the Note is 1.0% per annum. Payments of principal and interest are deferred for 180 days from the date of the Note. The Paycheck Protection Program provides a mechanism for forgiveness of up to the full amount borrowed as long as the Company uses the loan proceeds during the eight-week period after the loan origination for eligible purposes as described in the CARES Act and related guidance.

German Withholding Tax

First Amendment to 2019 Solar Capital Loan Agreement

On May 1, 2020, the Company entered into a First Amendment to its 2019 Solar Loan Agreement. (See Note 10 above for expanded disclosures.)

INTANGIBLE ASSET - (Tables)

The estimated future amortization expense as of March 31, 2020 for the remaining periods in the next five years and thereafter is as follows:



Years Ending December 31	(In thousands)
2020	$	1,462
2021	1,940
2022	1,940
2023	1,940
2024	1,946
Thereafter	5,071
Total	$	14,299

LEASES - Future Minimum Finance Lease Payments (Details) - USD ($)
$ in Thousands

LEASES - Narrative (Details) - USD ($)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Reverse Stock Split

On November 14, 2019, the Company filed a certificate of amendment to its restated certificate of incorporation with the Secretary of State of the State of Delaware, which effected a one-for-15 reverse stock split (the “reverse split”) of its issued and outstanding shares of common stock at 5:01 PM Eastern Time on that date. As a result of the reverse split, every 15 shares of common stock issued and outstanding were converted into one share of common stock. The Company paid cash in lieu of fractional shares, and accordingly, no fractional shares were issued in connection with the reverse split.

Accounting Standards Issued but Not Yet Effective

INVENTORY

Inventory consisted of the following:



	March 31, 2020		December 31, 2019
	(In thousands)
Component parts (1)	$	380	$	389
Work-in-process (2)	220		399
Finished goods	596		602
Total Inventory	$	1,196	$	1,390

(1) Component parts inventory consists of manufactured components of the ILUVIEN applicator.

EARNINGS (LOSS) PER SHARE (EPS)

EARNINGS (LOSS) PER SHARE (EPS)



	Three Months Ended March 31,
	2020	2019
Series A convertible preferred stock	601,504	601,504
Series C convertible preferred stock	676,667	676,667
Common stock warrants	119,712	119,712
Stock options	1,036,484	894,097
Restricted stock units	30,086	32,029
Total	2,464,453	2,324,009

STOCK INCENTIVE PLANS - Summary of RSU Transactions (Details) - Restricted Stock and Restricted Stock Units - $ / shares

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($)
$ in Thousands

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

LOAN AGREEMENTS - 2016 Warrant Narrative (Details) - Alimera Sciences Limited (Limited) - Hercules Technology Growth Capital, Inc. - Fourth Loan Amendment

INTANGIBLE ASSET - Future Amortization (Details) - USD ($)
$ in Thousands

Document and Entity Information - shares

STOCK INCENTIVE PLANS - Narrative (Detail) - USD ($)
$ in Thousands

BASIS OF PRESENTATION

BASIS OF PRESENTATION

Effects of the COVID-19 Pandemic

STOCK INCENTIVE PLANS - (Tables)

The following table presents a summary of stock option activity for the three months ended March 31, 2020 and 2019:



	Three Months Ended March 31,
	2020			2019
	Options		Weighted Average Exercise Price ($)	Options		Weighted Average Exercise Price ($)
Options outstanding at beginning of period	871,472		35.46	830,100		39.41
Grants	168,850		6.75	78,324		13.10
Forfeitures	(3,838	)	20.99	(14,318	)	29.92
Exercises	—		—	—		—
Options outstanding at period end	1,036,484		30.84	894,106		37.25
Options exercisable at period end	707,763		40.00	636,028		45.22
Weighted average per share fair value of options granted during the period	$4.18			$8.21

The following table provides additional information related to outstanding stock options, exercisable stock options and stock options that were expected to vest as of March 31, 2020:



	Shares	Weighted Average Exercise Price ($)	Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value ($)
				(In thousands)
Outstanding	1,036,484	30.84	4.97 years	9
Exercisable	707,763	40.00	4.97 years	9
Outstanding, vested and expected to vest	989,943	31.83	6.12 years	99

The following table provides additional information related to outstanding stock options, exercisable stock options and stock options that were expected to vest as of December 31, 2019:



	Shares	Weighted Average Exercise Price ($)	Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value ($)
				(In thousands)
Outstanding	871,472	35.46	5.83 years	4,043
Exercisable	674,952	41.25	5.04 years	13
Outstanding, vested and expected to vest	849,285	36.00	5.75 years	3,324

A summary of restricted stock and restricted stock units (RSU) transactions under the plans are as follows:



	Three Months Ended March 31,
	2020			2019
	Restricted Stock & RSUs		Weighted Average Grant Date Fair Value ($)	Restricted Stock & RSUs		Weighted Average Grant Date Fair Value ($)
Restricted stock & RSUs outstanding at beginning of period	36,763		13.15	60,041		17.30
Grants	30,086		3.12	32,029		12.90
Vested units	(36,763	)	13.15	(59,341	)	17.30
Forfeitures	—		—	(700	)	17.40
Restricted stock & RSUs outstanding at period end	30,086		3.12	32,029		12.90

INCOME TAXES

As of December 31, 2019, the Company had cumulative book losses in foreign subsidiaries of $134,379,000. The Company has not recorded a deferred tax asset for the excess of tax over book basis in the stock of its foreign subsidiaries. The Company anticipates that its foreign subsidiaries will be profitable and have earnings in the future. Once the foreign subsidiaries do have earnings, the Company intends to indefinitely reinvest in its foreign subsidiaries all undistributed earnings of and original investments in such subsidiaries. As a result, the Company has not recorded a deferred tax liability related to excess of book over tax basis in the stock of its foreign subsidiaries in accordance with ASC 740-30-25.

LEASES - (Tables)

Supplemental balance sheet information as of March 31, 2020 and December 31, 2019 for the Company’s finance leases is as follows:



	March 31, 2020		December 31, 2019
	(In thousands)
NON-CURRENT ASSETS:
Property and equipment, net	$	406	$	414
Total lease assets	$	406	$	414

CURRENT LIABILITIES:
Finance lease obligations	$	243	$	255
NON-CURRENT LIABILITIES:
Finance lease obligations — less current portion	97		94
Total lease liabilities	$	340	$	349

Supplemental balance sheet information as of March 31, 2020 for the Company’s operating leases is as follows:



	(in thousands)
NON-CURRENT ASSETS:
Right of use assets, net	$	967
Total lease assets	$	967

CURRENT LIABILITIES:
Accrued expenses	$	473
NON-CURRENT LIABILITIES:
Other non-current liabilities	665
Total lease liabilities	$	1,138

As of March 31, 2020, a schedule of maturity of lease liabilities under all of the Company’s operating leases is as follows:



Years Ending December 31	(In thousands)
2020	$	499
2021	451
2022	152
2023	152
2024	155
Thereafter	—
Total	1,409
Less amount representing interest	(271		)
Present value of minimum lease payments	1,138
Less current portion	(473		)
Non-current portion	$	665

As of March 31, 2020, a schedule of maturity of lease liabilities under finance leases, together with the present value of minimum lease payments, is as follows:



Years Ending December 31	(In thousands)
2020	238
2021	105
2022	20
2023	1
Total	364
Less amount representing interest	(24		)
Present value of minimum lease payments	340
Less current portion	(243		)
Non-current portion	$	97

LEASES

Operating Leases

Supplemental balance sheet information as of March 31, 2020 for the Company’s operating leases is as follows:



	(in thousands)
NON-CURRENT ASSETS:
Right of use assets, net	$	967
Total lease assets	$	967

CURRENT LIABILITIES:
Accrued expenses	$	473
NON-CURRENT LIABILITIES:
Other non-current liabilities	665
Total lease liabilities	$	1,138

As of March 31, 2020, a schedule of maturity of lease liabilities under all of the Company’s operating leases is as follows:



Years Ending December 31	(In thousands)
2020	$	499
2021	451
2022	152
2023	152
2024	155
Thereafter	—
Total	1,409
Less amount representing interest	(271		)
Present value of minimum lease payments	1,138
Less current portion	(473		)
Non-current portion	$	665

Finance Leases

Supplemental balance sheet information as of March 31, 2020 and December 31, 2019 for the Company’s finance leases is as follows:



	March 31, 2020		December 31, 2019
	(In thousands)
NON-CURRENT ASSETS:
Property and equipment, net	$	406	$	414
Total lease assets	$	406	$	414

CURRENT LIABILITIES:
Finance lease obligations	$	243	$	255
NON-CURRENT LIABILITIES:
Finance lease obligations — less current portion	97		94
Total lease liabilities	$	340	$	349

As of March 31, 2020, a schedule of maturity of lease liabilities under finance leases, together with the present value of minimum lease payments, is as follows:



Years Ending December 31	(In thousands)
2020	238
2021	105
2022	20
2023	1
Total	364
Less amount representing interest	(24		)
Present value of minimum lease payments	340
Less current portion	(243		)
Non-current portion	$	97

LEASES

Operating Leases

Supplemental balance sheet information as of March 31, 2020 for the Company’s operating leases is as follows:



	(in thousands)
NON-CURRENT ASSETS:
Right of use assets, net	$	967
Total lease assets	$	967

CURRENT LIABILITIES:
Accrued expenses	$	473
NON-CURRENT LIABILITIES:
Other non-current liabilities	665
Total lease liabilities	$	1,138

As of March 31, 2020, a schedule of maturity of lease liabilities under all of the Company’s operating leases is as follows:



Years Ending December 31	(In thousands)
2020	$	499
2021	451
2022	152
2023	152
2024	155
Thereafter	—
Total	1,409
Less amount representing interest	(271		)
Present value of minimum lease payments	1,138
Less current portion	(473		)
Non-current portion	$	665

Finance Leases

Supplemental balance sheet information as of March 31, 2020 and December 31, 2019 for the Company’s finance leases is as follows:



	March 31, 2020		December 31, 2019
	(In thousands)
NON-CURRENT ASSETS:
Property and equipment, net	$	406	$	414
Total lease assets	$	406	$	414

CURRENT LIABILITIES:
Finance lease obligations	$	243	$	255
NON-CURRENT LIABILITIES:
Finance lease obligations — less current portion	97		94
Total lease liabilities	$	340	$	349

As of March 31, 2020, a schedule of maturity of lease liabilities under finance leases, together with the present value of minimum lease payments, is as follows:



Years Ending December 31	(In thousands)
2020	238
2021	105
2022	20
2023	1
Total	364
Less amount representing interest	(24		)
Present value of minimum lease payments	340
Less current portion	(243		)
Non-current portion	$	97

LICENSE AGREEMENTS

LICENSE AGREEMENTS

EyePoint Agreement

LEASES - Future Minimum Operating Lease Payments (Details)
$ in Thousands

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details)

INVENTORY - Narrative (Detail) - USD ($)
$ in Thousands

STOCK INCENTIVE PLANS - Summary of Stock Option Transactions (Detail) - $ / shares

SEGMENT INFORMATION - Summary of Operations by Segment (Details) - USD ($)
$ in Thousands

GOING CONCERN

LOAN AGREEMENTS

Hercules Loan Agreement

2014 Warrant

2016 Warrant

Solar Capital Loan Agreement

The Company agreed, for itself and its subsidiaries, to customary affirmative and negative covenants and events of default in connection with the 2018 Solar Loan Agreement.

2018 Exit Fee Agreement

2019 Solar Capital Loan Agreement

First Amendment to 2019 Solar Capital Loan Agreement

On May 1, 2020, the Company entered into a First Amendment (the Amendment) to its 2019 Solar Loan Agreement with Solar Capital. The Amendment, among other things:

(a)eliminates the previous requirement that the following covenant (the Revenue Covenant) be measured at June 30, 2020 and September 30, 2020: the Company shall not permit revenues (under U.S. GAAP) from the sale of ILUVIEN in the ordinary course of business to third party customers, on a trailing six-month basis, to be less than a specified minimum revenue amount for each such date;

(b)requires that the Revenue Covenant be measured at November 30, 2020 and specifies a new minimum revenue amount in that regard;

(c)requires that the Revenue Covenant be measured at December 31, 2020 and specifies a new minimum revenue amount in that regard; and

Modification of Debt

Fair Value of Debt

GOING CONCERN - Narrative (Detail) - USD ($)

LEASES - Operating Lease Supplemental Balance Sheet Information (Details) - USD ($)
$ in Thousands

NATURE OF OPERATIONS - Narrative (Detail) - ILUVIEN

STOCK INCENTIVE PLANS - Additional Stock Option Transactions (Detail) - USD ($)
$ / shares in Units, $ in Thousands

SUBSEQUENT EVENTS - Narrative (Details) - Paycheck Protection Plan - Notes Payable to Banks - Subsequent Event

EARNINGS (LOSS) PER SHARE (EPS) - Antidilutive Securities Excluded from the Computation of Diluted Earnings Per Share (Details) - shares

NATURE OF OPERATIONS

NATURE OF OPERATIONS

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
$ in Thousands

LOAN AGREEMENTS - 2014 Warrant Narrative (Details) - Alimera Sciences, Inc.(Company) - Hercules Technology Growth Capital, Inc. - $ / shares

INTANGIBLE ASSET - Narrative (Details) - USD ($)
$ in Thousands

SEGMENT INFORMATION

SEGMENT INFORMATION

The following table presents a summary of the Company’s reporting segments for the three months ended March 31, 2020 and 2019:



	Three Months Ended March 31, 2020												Three Months Ended March 31, 2019
	U.S.			International			Other			Consolidated			U.S.			International			Other			Consolidated
	(In thousands)
NET REVENUE	$	7,068		$	7,467		$	—		$	14,535		$	6,766		$	6,124		$	—		$	12,890
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION	(759		)	(1,168		)	—			(1,927		)	(685		)	(915		)	—			(1,600		)
GROSS PROFIT	6,309			6,299			—			12,608			6,081			5,209			—			11,290

RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES	1,922			893			68			2,883			1,427			1,170			130			2,727
GENERAL AND ADMINISTRATIVE EXPENSES	1,973			936			272			3,181			1,933			988			472			3,393
SALES AND MARKETING EXPENSES	4,280			1,292			100			5,672			4,041			1,705			167			5,913
DEPRECIATION AND AMORTIZATION	—			—			654			654			—			—			652			652
OPERATING EXPENSES	8,175			3,121			1,094			12,390			7,401			3,863			1,421			12,685
SEGMENT (LOSS) INCOME FROM OPERATIONS	(1,866		)	3,178			(1,094		)	218			(1,320		)	1,346			(1,421		)	(1,395		)
OTHER INCOME AND EXPENSES, NET	—			—			(1,373		)	(1,373		)	—			—			(1,297		)	(1,297		)
NET LOSS BEFORE TAXES										$	(1,155	)										$	(2,692	)

INVENTORY - (Tables)

Inventory consisted of the following:



	March 31, 2020		December 31, 2019
	(In thousands)
Component parts (1)	$	380	$	389
Work-in-process (2)	220		399
Finished goods	596		602
Total Inventory	$	1,196	$	1,390

(1) Component parts inventory consists of manufactured components of the ILUVIEN applicator.

SEGMENT INFORMATION - (Tables)

The following table presents a summary of the Company’s reporting segments for the three months ended March 31, 2020 and 2019:



	Three Months Ended March 31, 2020												Three Months Ended March 31, 2019
	U.S.			International			Other			Consolidated			U.S.			International			Other			Consolidated
	(In thousands)
NET REVENUE	$	7,068		$	7,467		$	—		$	14,535		$	6,766		$	6,124		$	—		$	12,890
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION	(759		)	(1,168		)	—			(1,927		)	(685		)	(915		)	—			(1,600		)
GROSS PROFIT	6,309			6,299			—			12,608			6,081			5,209			—			11,290

RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES	1,922			893			68			2,883			1,427			1,170			130			2,727
GENERAL AND ADMINISTRATIVE EXPENSES	1,973			936			272			3,181			1,933			988			472			3,393
SALES AND MARKETING EXPENSES	4,280			1,292			100			5,672			4,041			1,705			167			5,913
DEPRECIATION AND AMORTIZATION	—			—			654			654			—			—			652			652
OPERATING EXPENSES	8,175			3,121			1,094			12,390			7,401			3,863			1,421			12,685
SEGMENT (LOSS) INCOME FROM OPERATIONS	(1,866		)	3,178			(1,094		)	218			(1,320		)	1,346			(1,421		)	(1,395		)
OTHER INCOME AND EXPENSES, NET	—			—			(1,373		)	(1,373		)	—			—			(1,297		)	(1,297		)
NET LOSS BEFORE TAXES										$	(1,155	)										$	(2,692	)

REVENUE RECOGNITION - Narrative (Details) $ in Millions	3 Months Ended
REVENUE RECOGNITION - Narrative (Details) $ in Millions	Mar. 31, 2020 USD ($)
Revenue from Contract with Customer [Abstract]
Milestone payments not recognized as revenue, noncurrent	$ 1
Period before expiration date returns are accepted	3 months
Period after expiration date returns are accepted	1 year
Performance obligation, description of satisfaction timing	The Company receives payments from its Customers based on billing schedules established in each contract, which vary across the Company’s locations, but generally range between 30 to 120 days.

REVENUE RECOGNITION	3 Months Ended
REVENUE RECOGNITION	Mar. 31, 2020
Revenue from Contract with Customer [Abstract]
REVENUE RECOGNITION	REVENUE RECOGNITION Net Revenue The Company sells its products to major pharmaceutical distributors, pharmacies, hospitals and wholesalers (collectively, its Customers). In addition to distribution agreements with Customers, the Company enters into arrangements with healthcare providers and payors that provide for government-mandated and/or privately-negotiated rebates, chargebacks, and discounts with respect to the purchase of the Company’s products. All of the Company’s current contracts have a single performance obligation, as the promise to transfer the individual goods is not separately identifiable from other promises in the contracts and is, therefore, not distinct. All of the Company’s revenue is derived from product sales. The Company recognizes revenues from product sales at a point in time when the Customer obtains control, typically upon delivery. The Company accrues for fulfillment costs when the related revenue is recognized. Taxes collected from Customers relating to product sales and remitted to governmental authorities are excluded from revenues. As of March 31, 2020, the Company had received a total of $1,000,000 of milestone payments in connection with the Company’s Canadian distributor that it has not recognized as revenue based on the Company’s analysis in connection with ASU 2014-09, Revenue from Contracts with Customers (ASC 606). These deferred revenues are included as a component of other non-current liabilities on the Company’s balance sheets. Estimates of Variable Consideration Revenues from product sales are recorded at the net sales price (transaction price), which includes estimates of variable consideration for reserves related to statutory rebates to State Medicaid and other government agencies; commercial rebates and fees to Managed Care Organizations (MCOs), Group Purchasing Organizations (GPOs), distributors, and specialty pharmacies; product returns; sales discounts (including trade discounts); distributor costs; wholesaler chargebacks; and allowances for patient assistance programs relating to the Company’s sales of its products. These reserves are based on estimates of the amounts earned or to be claimed on the related sales. Management’s estimates take into consideration historical experience, current contractual and statutory requirements, specific known market events and trends, industry data, and Customer buying and payment patterns. Overall, these reserves reflect the Company’s best estimates of the amount of consideration to which it is entitled based on the terms of the contract. The amount of variable consideration included in the net sales price is limited to the amount that is probable not to result in a significant reversal in the amount of the cumulative revenue recognized in a future period. If actual results vary, the Company may adjust these estimates, which could have an effect on earnings in the period of adjustment. With respect to the Company’s international contracts with third party distributors, certain contracts have elements of variable consideration, and management reviews those contracts on a regular basis and makes estimates of revenue based on historical ordering patterns and known market events and data. The amount of variable consideration included in net sales in each period could vary depending on the terms of these contracts and the probability of reversal in future periods. Consideration Payable to Customers Distribution service fees are payments issued to distributors for compliance with various contractually-defined inventory management practices or services provided to support patient access to a product. Distribution service fees reserves are based on the terms of each individual contract and are classified within accrued expenses and are recorded as a reduction of revenue. Product Returns The Company’s policies provide for product returns in the following circumstances: (a) expiration of shelf life on certain products; (b) product damaged while in the Customer’s possession; and (c) following product recalls. Generally, returns for expired product are accepted three months before and up to one year after the expiration date of the related product, and the related product is destroyed after it is returned. The Company may either refund the sales price paid by the Customer by issuing a credit or exchanging the returned product for replacement inventory. The Company typically does not provide cash refunds. The Company estimates the proportion of recorded revenue that will result in a return by considering relevant factors, including historical returns experience, the estimated level of inventory in the distribution channel, the shelf life of products and product recalls, if any. The estimation process for product returns involves, in each case, several interrelating assumptions, which vary for each Customer. The Company estimates the amount of its product sales that may be returned by its Customers and records this estimate as a reduction of revenue from product sales in the period the related revenue is recognized, and because this returned product cannot be resold, there is no corresponding asset for product returns. To date, product returns have been minimal. Other Revenue The Company enters into agreements in which it licenses certain rights to its products to partner companies that act as distributors. The terms of these arrangements may include payment to the Company of one or more of the following: non-refundable, up-front license fees; development, regulatory and commercial milestone payments; payments for manufacturing supply services the Company provides; and a revenue share on net sales of licensed products. Each of these payments is recognized as other revenues. As part of the accounting for these arrangements, the Company must develop estimates that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. Performance obligations are promises in a contract to transfer a distinct good or service to the Customer, and the Company recognizes revenue when, or as, performance obligations are satisfied. The Company uses key assumptions to determine the stand-alone selling price; these assumptions may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical, regulatory and commercial success. Certain of these agreements include consideration in the form of milestone payments. At the inception of each arrangement that includes milestone payments, the Company evaluates the recognition of milestone payments. Typically, milestone payments are associated with events that are not entirely within the control of the Company or the licensee, such as regulatory approvals; are included in the transaction price; and are subject to a constraint until it is probable that there will not be a significant revenue reversal, typically upon achievement of the milestone. At the end of each reporting period, the Company re-evaluates the probability of achievement of such milestones and any related constraint, and if necessary, adjusts its estimate of the overall transaction price. Customer Payment Obligations The Company receives payments from its Customers based on billing schedules established in each contract, which vary across the Company’s locations, but generally range between 30 to 120 days. Occasionally, the timing of receipt of payment for the Company’s international Customers can be extended. Amounts are recorded as accounts receivable when the Company’s right to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation is that the Customer will pay for the product or services in one year or less of receiving those products or services.

INCOME TAXES - Narrative (Detail) - USD ($)	3 Months Ended
INCOME TAXES - Narrative (Detail) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Operating Loss Carryforwards [Line Items]
Uncertain tax positions liability increase	$ 8,000
Cumulative book losses in foreign subsidiaries		$ 134,379,000
Federal
Operating Loss Carryforwards [Line Items]
Net operating loss carry-forwards	$ 125,756,000	125,756,000
State
Operating Loss Carryforwards [Line Items]
Net operating loss carry-forwards		$ 172,993,000

LOAN AGREEMENTS - Solar Capital Loan Agreement Narrative (Details) - Solar Capital Ltd. - USD ($)				2 Months Ended	12 Months Ended
	Feb. 21, 2020	Dec. 31, 2019	Jan. 05, 2018	Feb. 21, 2020	Dec. 31, 2019	Nov. 30, 2020	Mar. 31, 2020	Dec. 31, 2018
2018 Term Loan
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity			$ 40,000,000
Payments for brokerage fees			$ 400,000
Fees paid on modification		$ 2,278,000
Debt instrument repayment fee amount, paid		1,800,000
Debit instrument prepayment fee paid		400,000
Debt issuance costs, net		427,000			$ 427,000
Amortization of debt issuance costs					76,000
2018 Term Loan \| London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate			7.65%
2019 Solar Loan Agreement
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity		$ 45,000,000			$ 45,000,000
Debt instrument, basis spread on variable rate		7.65%
Debt instrument, interest rate, stated percentage		1.78%			1.78%
Proceeds from lines of credit				$ 45,000,000
Interest rate effective percentage		9.43%			9.43%
Interest only payments, term		6 months
Principal and interest payments, term		1 year
Nonrefundable facility fee amount	$ 25,000
Debt instrument, fee amount							$ 2,250,000
2019 Solar Loan Agreement \| Tranche One
Debt Instrument [Line Items]
Proceeds from lines of credit		$ 42,500,000
2019 Solar Loan Agreement \| Tranche Two
Debt Instrument [Line Items]
Proceeds from lines of credit	$ 2,500,000
Alimera Sciences Limited (Limited) \| 2018 Term Loan
Debt Instrument [Line Items]
Debt instrument, interest rate, stated percentage								9.30%
Exit Fee Agreement \| 2018 Term Loan
Debt Instrument [Line Items]
Debt instrument, term			10 years
Debt instrument, exit fee			$ 2,000,000
Subsequent Event \| 2019 Solar Loan Agreement
Debt Instrument [Line Items]
Debt covenant, amount of unrestricted cash and cash equivalents						$ 9,000,000

LICENSE AGREEMENTS - Narrative (Details) - USD ($)				1 Months Ended	3 Months Ended
LICENSE AGREEMENTS - Narrative (Details) - USD ($)	Dec. 12, 2018	Jul. 10, 2017	Jul. 01, 2017	Mar. 31, 2019	Mar. 31, 2020	Mar. 31, 2019
Collaborative Arrangement, Co-promotion
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Collaborative arrangement, royalty payable on net revenue, percentage	6.00%		2.00%
Collaborative arrangement, royalty payable on net revenue over threshold, percentage		2.00%
Collaborative arrangement, royalty payable on net revenue, revenue threshold		$ 75,000,000
Collaborative arrangement, forgiveness of future offset, additional amount				$ 5,000,000
New Collaboration Agreement, 2017 Second Amended
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Royalty expense					$ 581,000	$ 516,000
Accrued royalty expense					581,000
Maximum \| Collaborative Arrangement, Co-promotion
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Recoverable amount to offset future royalty payments		$ 15,000,000			$ 8,567,000

LEASES - Finance Lease Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
NON-CURRENT ASSETS:
Finance lease, right-of-use asset	$ 406	$ 414
CURRENT LIABILITIES:
Finance lease obligations	243	255
NON-CURRENT LIABILITIES:
Finance lease obligations — less current portion	97	94
Total finance lease liabilities	$ 340	$ 349

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (1,198)	$ (2,763)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	654	652
Unrealized foreign currency transaction loss	81	69
Amortization of debt discount	239	206
Stock-based compensation expense	440	770
Changes in assets and liabilities:
Accounts receivable	3,036	1,755
Prepaid expenses and other current assets	54	(381)
Inventory	177	532
Accounts payable	(1,154)	301
Accrued expenses and other current liabilities	(1,627)	(857)
Other long-term liabilities	(154)	0
Net cash provided by operating activities	548	284
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(25)	(15)
Net cash used in investing activities	(25)	(15)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of debt	2,500	0
Payment of debt costs	(3)	0
Payment of finance lease obligations	(82)	(110)
Net cash provided by (used in) financing activities	2,415	(110)
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS AND RESTRICTED CASH	(124)	(107)
NET CHANGE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH	2,814	52
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH — Beginning of period	9,459	13,075
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH — End of period	12,273	13,127
SUPPLEMENTAL DISCLOSURES:
Cash paid for interest	1,007	1,012
Cash paid for income taxes	30	4
Supplemental schedule of non-cash investing and financing activities:
Property and equipment acquired under finance leases	$ 74	$ 64

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
CURRENT ASSETS:
Cash and cash equivalents	$ 12,242	$ 9,426
Restricted cash	31	33
Accounts receivable, net	16,179	19,331
Prepaid expenses and other current assets	2,497	2,565
Inventory (Note 7)	1,196	1,390
Total current assets	32,145	32,745
NON-CURRENT ASSETS:
Property and equipment, net	867	940
Right of use assets, net	967	1,107
Intangible asset, net (Note 8)	14,299	14,783
Deferred tax asset	720	734
TOTAL ASSETS	48,998	50,309
CURRENT LIABILITIES:
Accounts payable	5,833	7,077
Accrued expenses	3,045	4,716
Finance lease obligations	243	255
Total current liabilities	9,121	12,048
NON-CURRENT LIABILITIES:
Note payable, net of discount (Note 10)	41,395	38,658
Finance lease obligations — less current portion	97	94
Other non-current liabilities	3,789	3,954
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ (DEFICIT) EQUITY:
Common stock, $.01 par value — 150,000,000 shares authorized, 5,028,882 shares issued and outstanding at March 31, 2020 and 4,965,949 shares issued and outstanding at December 31, 2019	50	50
Additional paid-in capital	350,442	350,117
Common stock warrants	3,707	3,707
Accumulated deficit	(388,768)	(387,570)
Accumulated other comprehensive loss	(1,179)	(1,093)
TOTAL STOCKHOLDERS’ (DEFICIT) EQUITY	(5,404)	(4,445)
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY	48,998	50,309
Series A convertible preferred stock
STOCKHOLDERS’ (DEFICIT) EQUITY:
Preferred stock	19,227	19,227
Series C convertible preferred stock
STOCKHOLDERS’ (DEFICIT) EQUITY:
Preferred stock	$ 11,117	$ 11,117

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Policies)	3 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Policies)	Mar. 31, 2020
Accounting Policies [Abstract]
Basis of Presentation	BASIS OF PRESENTATION The Company has prepared the accompanying unaudited interim condensed consolidated financial statements and notes thereto (Interim Financial Statements) in accordance with accounting principles generally accepted in the U.S. (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Article 8-03 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, these Interim Financial Statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of the Company’s management, the accompanying Interim Financial Statements reflect all adjustments, which include normal recurring adjustments, necessary to present fairly the Company’s interim financial information. The accompanying Interim Financial Statements and related notes should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2019 and related notes included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on March 2, 2020. The financial results for any interim period are not necessarily indicative of the expected financial results for the full year.
Recent Accounting Pronouncements and Adoption of New Accounting Standards	Accounting Standards Issued but Not Yet Effective In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-13, Financial Instruments - Credit Losses (Accounting Standards Codification (ASC 326)): Measurement of Credit Losses on Financial Instruments. This ASU replaces the current incurred loss impairment methodology for financial assets measured at amortized cost with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information, including forecasted information, to develop credit loss estimates. The standard becomes effective for the Company on January 1, 2023. The Company does not anticipate the adoption of this ASU will have a material impact on its financial statements.
Revenue Recognition	Net Revenue The Company sells its products to major pharmaceutical distributors, pharmacies, hospitals and wholesalers (collectively, its Customers). In addition to distribution agreements with Customers, the Company enters into arrangements with healthcare providers and payors that provide for government-mandated and/or privately-negotiated rebates, chargebacks, and discounts with respect to the purchase of the Company’s products. All of the Company’s current contracts have a single performance obligation, as the promise to transfer the individual goods is not separately identifiable from other promises in the contracts and is, therefore, not distinct. All of the Company’s revenue is derived from product sales. The Company recognizes revenues from product sales at a point in time when the Customer obtains control, typically upon delivery. The Company accrues for fulfillment costs when the related revenue is recognized. Taxes collected from Customers relating to product sales and remitted to governmental authorities are excluded from revenues. As of March 31, 2020, the Company had received a total of $1,000,000 of milestone payments in connection with the Company’s Canadian distributor that it has not recognized as revenue based on the Company’s analysis in connection with ASU 2014-09, Revenue from Contracts with Customers (ASC 606). These deferred revenues are included as a component of other non-current liabilities on the Company’s balance sheets. Estimates of Variable Consideration Revenues from product sales are recorded at the net sales price (transaction price), which includes estimates of variable consideration for reserves related to statutory rebates to State Medicaid and other government agencies; commercial rebates and fees to Managed Care Organizations (MCOs), Group Purchasing Organizations (GPOs), distributors, and specialty pharmacies; product returns; sales discounts (including trade discounts); distributor costs; wholesaler chargebacks; and allowances for patient assistance programs relating to the Company’s sales of its products. These reserves are based on estimates of the amounts earned or to be claimed on the related sales. Management’s estimates take into consideration historical experience, current contractual and statutory requirements, specific known market events and trends, industry data, and Customer buying and payment patterns. Overall, these reserves reflect the Company’s best estimates of the amount of consideration to which it is entitled based on the terms of the contract. The amount of variable consideration included in the net sales price is limited to the amount that is probable not to result in a significant reversal in the amount of the cumulative revenue recognized in a future period. If actual results vary, the Company may adjust these estimates, which could have an effect on earnings in the period of adjustment. With respect to the Company’s international contracts with third party distributors, certain contracts have elements of variable consideration, and management reviews those contracts on a regular basis and makes estimates of revenue based on historical ordering patterns and known market events and data. The amount of variable consideration included in net sales in each period could vary depending on the terms of these contracts and the probability of reversal in future periods. Consideration Payable to Customers Distribution service fees are payments issued to distributors for compliance with various contractually-defined inventory management practices or services provided to support patient access to a product. Distribution service fees reserves are based on the terms of each individual contract and are classified within accrued expenses and are recorded as a reduction of revenue. Product Returns The Company’s policies provide for product returns in the following circumstances: (a) expiration of shelf life on certain products; (b) product damaged while in the Customer’s possession; and (c) following product recalls. Generally, returns for expired product are accepted three months before and up to one year after the expiration date of the related product, and the related product is destroyed after it is returned. The Company may either refund the sales price paid by the Customer by issuing a credit or exchanging the returned product for replacement inventory. The Company typically does not provide cash refunds. The Company estimates the proportion of recorded revenue that will result in a return by considering relevant factors, including historical returns experience, the estimated level of inventory in the distribution channel, the shelf life of products and product recalls, if any. The estimation process for product returns involves, in each case, several interrelating assumptions, which vary for each Customer. The Company estimates the amount of its product sales that may be returned by its Customers and records this estimate as a reduction of revenue from product sales in the period the related revenue is recognized, and because this returned product cannot be resold, there is no corresponding asset for product returns. To date, product returns have been minimal. Other Revenue The Company enters into agreements in which it licenses certain rights to its products to partner companies that act as distributors. The terms of these arrangements may include payment to the Company of one or more of the following: non-refundable, up-front license fees; development, regulatory and commercial milestone payments; payments for manufacturing supply services the Company provides; and a revenue share on net sales of licensed products. Each of these payments is recognized as other revenues. As part of the accounting for these arrangements, the Company must develop estimates that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. Performance obligations are promises in a contract to transfer a distinct good or service to the Customer, and the Company recognizes revenue when, or as, performance obligations are satisfied. The Company uses key assumptions to determine the stand-alone selling price; these assumptions may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical, regulatory and commercial success. Certain of these agreements include consideration in the form of milestone payments. At the inception of each arrangement that includes milestone payments, the Company evaluates the recognition of milestone payments. Typically, milestone payments are associated with events that are not entirely within the control of the Company or the licensee, such as regulatory approvals; are included in the transaction price; and are subject to a constraint until it is probable that there will not be a significant revenue reversal, typically upon achievement of the milestone. At the end of each reporting period, the Company re-evaluates the probability of achievement of such milestones and any related constraint, and if necessary, adjusts its estimate of the overall transaction price. Customer Payment Obligations The Company receives payments from its Customers based on billing schedules established in each contract, which vary across the Company’s locations, but generally range between 30 to 120 days. Occasionally, the timing of receipt of payment for the Company’s international Customers can be extended. Amounts are recorded as accounts receivable when the Company’s right to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation is that the Customer will pay for the product or services in one year or less of receiving those products or services.
Leases	The Company evaluates all of its contracts to determine whether it is or contains a lease at inception. The Company reviews its contracts for options to extend, terminate or purchase any right of use assets and accounts for these, as applicable, at inception of the contract. Lease renewal options are not recognized as part of the lease liability until the Company determines it is reasonably certain it will exercise any applicable renewal options. The Company has not recorded any liability for renewal options in these Interim Financial Statements. The useful lives of leased assets as well as leasehold improvements, if any, are limited by the expected lease term.
Intangible Assets	Property and equipment and definite lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When indicators of impairment are present, the Company evaluates the carrying amount of such assets in relation to the operating performance and future estimated undiscounted net cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. The assessment of the recoverability of assets will be impacted if estimated future operating cash flows are not achieved.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIT) EQUITY - USD ($) $ in Thousands	Total	Common Stock	Preferred Stock Series A Convertible Preferred Stock	Preferred Stock Series C Convertible Preferred Stock	Additional Paid-In Capital	Common Stock Warrants	Accumulated Deficit	Accumulated Other Comprehensive Loss
Beginning balance (in shares) at Dec. 31, 2018		4,671,921	600,000	10,150
Beginning balance at Dec. 31, 2018	$ 2,722	$ 47	$ 19,227	$ 11,117	$ 346,762	$ 3,707	$ (377,127)	$ (1,011)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock, net of issuance costs (in shares)		59,319
Issuance of common stock, net of issuance costs	0	$ 0			0
Stock-based compensation	770				770
Net loss	(2,763)						(2,763)
Foreign currency translation adjustments	(83)							(83)
Ending balance (in shares) at Mar. 31, 2019		4,731,240	600,000	10,150
Ending balance at Mar. 31, 2019	646	$ 47	$ 19,227	$ 11,117	347,532	3,707	(379,890)	(1,094)
Beginning balance (in shares) at Dec. 31, 2019		4,965,949	600,000	10,150
Beginning balance at Dec. 31, 2019	(4,445)	$ 50	$ 19,227	$ 11,117	350,117	3,707	(387,570)	(1,093)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock, net of issuance costs (in shares)		62,933
Issuance of common stock, net of issuance costs	0	$ 0			0
Stock-based compensation	440				440
Other	(115)				(115)
Net loss	(1,198)
Foreign currency translation adjustments	(86)
Ending balance (in shares) at Mar. 31, 2020		5,028,882	600,000	10,150
Ending balance at Mar. 31, 2020	$ (5,404)	$ 50	$ 19,227	$ 11,117	$ 350,442	$ 3,707	$ (388,768)	$ (1,179)

EARNINGS (LOSS) PER SHARE (EPS) - Narrative (Details)	Nov. 14, 2019
Earnings Per Share [Abstract]
Reverse stock split conversion ratio	0.0667

LOAN AGREEMENTS - Hercules Loan Agreement Narrative (Details)	Apr. 30, 2014 USD ($)
Alimera Sciences Limited (Limited) \| Hercules Technology Growth Capital, Inc. \| 2014 Term Loan
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	$ 35,000,000

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Preferred stock, par value (usd per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000
Common stock, par value (usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	150,000,000	150,000,000
Common stock, shares issued (in shares)	5,028,882	4,965,949
Common stock, shares outstanding (in shares)	5,028,882	4,965,949
Series A convertible preferred stock
Preferred stock, shares authorized (in shares)	1,300,000	1,300,000
Preferred stock, shares issued (in shares)	600,000	600,000
Preferred stock, shares outstanding (in shares)	600,000	600,000
Preferred stock, liquidation preference	$ 24,000,000	$ 24,000,000
Series C convertible preferred stock
Preferred stock, shares authorized (in shares)	10,150,000	10,150,000
Preferred stock, shares issued (in shares)	10,150,000	10,150,000
Preferred stock, shares outstanding (in shares)	10,150,000	10,150,000
Preferred stock, liquidation preference	$ 10,150,000	$ 10,150,000

SUBSEQUENT EVENTS	3 Months Ended
SUBSEQUENT EVENTS	Mar. 31, 2020
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	SUBSEQUENT EVENTS $1.8 Million Loan under the Paycheck Protection Program As we announced on April 23, 2020, the Company received on April 22, 2020 approximately $1.8 million in support in the form of a loan (the “PPP Loan”) from the U.S. federal government under the Paycheck Protection Program established as part of the Coronavirus Aid, Relief and Economic Security Act, or the CARES Act. The PPP Loan is unsecured and is evidenced by a note (the “Note”) in favor of HSBC Bank USA, National Association (“HSBC”) as the lender and is governed by a Loan Agreement with HSBC. The interest rate on the Note is 1.0% per annum. Payments of principal and interest are deferred for 180 days from the date of the Note. The Paycheck Protection Program provides a mechanism for forgiveness of up to the full amount borrowed as long as the Company uses the loan proceeds during the eight-week period after the loan origination for eligible purposes as described in the CARES Act and related guidance. In connection with the PPP Loan, the Company entered into a Consent to Loan and Security Agreement (the “Consent”) under the 2019 Solar Loan Agreement. In the Consent, Solar Capital consented as Collateral Agent and a Lender, and the other Lenders consented as Lenders, to the indebtedness incurred under the PPP Loan, subject to certain conditions, including the Company’s covenant to comply with specified provisions of the CARES Act, the Company’s confirmation of the accuracy of its representations and warranties in the 2019 Solar Loan Agreement and related documents and a release in favor of the Collateral Agent and the Lenders. German Withholding Tax In April 2020, recent interpretations of a German law relating to withholding taxes on intellectual property rights have emerged. The Company is currently evaluating this law and any related impact to its financial position or results of operations. First Amendment to 2019 Solar Capital Loan Agreement On May 1, 2020, the Company entered into a First Amendment to its 2019 Solar Loan Agreement. (See Note 10 above for expanded disclosures.)

LEASES - Future Minimum Finance Lease Payments (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Leases [Abstract]
2019 (remaining)	$ 238
2021	105
2022	20
2023	1
Total	364
Less amount representing interest	(24)
Total finance lease liabilities	340	$ 349
Less current portion	(243)	(255)
Non-current portion	$ 97	$ 94

STOCK INCENTIVE PLANS - Summary of RSU Transactions (Details) - Restricted Stock and Restricted Stock Units - $ / shares	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Restricted Stock & RSUs
Restricted stock units outstanding at beginning of period (in shares)	36,763	60,041
Grants (in shares)	30,086	32,029
Vested units (in shares)	(36,763)	(59,341)
Forfeitures (in shares)	0	(700)
Restricted stock units outstanding at year end (in shares)	30,086	32,029
Weighted Average Grant Date Fair Value ($)
Restricted stock units outstanding at beginning of period (usd per share)	$ 13.15	$ 17.30
Grants (usd per share)	3.12	12.90
Vested units (usd per share)	13.15	17.30
Forfeitures (usd per share)	0.00	17.40
Restricted stock units outstanding at year end (usd per share)	$ 3.12	$ 12.90

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Statement of Comprehensive Income [Abstract]
NET LOSS	$ (1,198)	$ (2,763)
OTHER COMPREHENSIVE LOSS
Foreign currency translation adjustments	(86)	(83)
TOTAL OTHER COMPREHENSIVE LOSS	(86)	(83)
COMPREHENSIVE LOSS	$ (1,284)	$ (2,846)

LOAN AGREEMENTS - 2016 Warrant Narrative (Details) - Alimera Sciences Limited (Limited) - Hercules Technology Growth Capital, Inc. - Fourth Loan Amendment	Oct. 20, 2016 $ / shares shares
Debt Instrument [Line Items]
Class of warrant or right, number of securities called by warrants or rights (in shares) \| shares	30,582
Class of warrant or right, exercise price of warrants or rights (usd per share) \| $ / shares	$ 16.35

INTANGIBLE ASSET - Future Amortization (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract]
Total	$ 14,299	$ 14,783
License
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract]
2020	1,462
2021	1,940
2022	1,940
2023	1,940
2024	1,946
Thereafter	5,071
Total	$ 14,299

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2020	May 04, 2020
Document and Entity Information [Abstract]
Entity Registrant Name	ALIMERA SCIENCES INC
Entity Central Index Key	0001267602
Document Type	10-Q
Document Period End Date	Mar. 31, 2020
Amendment Flag	false
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Smaller Reporting Company	true
Emerging Growth Company	false
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity common stock, shares outstanding (in shares)		5,031,745

BASIS OF PRESENTATION	3 Months Ended
BASIS OF PRESENTATION	Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BASIS OF PRESENTATION	BASIS OF PRESENTATION The Company has prepared the accompanying unaudited interim condensed consolidated financial statements and notes thereto (Interim Financial Statements) in accordance with accounting principles generally accepted in the U.S. (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Article 8-03 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, these Interim Financial Statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of the Company’s management, the accompanying Interim Financial Statements reflect all adjustments, which include normal recurring adjustments, necessary to present fairly the Company’s interim financial information. The accompanying Interim Financial Statements and related notes should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2019 and related notes included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on March 2, 2020. The financial results for any interim period are not necessarily indicative of the expected financial results for the full year. Effects of the COVID-19 Pandemic The public health crisis caused by the COVID-19 pandemic and the measures being taken by governments, businesses, and the public at large to limit COVID-19’s spread have had, and the Company expects will continue to have, certain negative effects on, and present certain risks to, the Company’s business. The Company is currently unable to fully determine its future impact on the Company’s business. These limitations and other effects of COVID-19 had a material adverse impact on the Company’s revenues late in the first quarter of 2020 and in the month of April 2020. The Company expects these factors to continue to adversely impact the Company’s revenue, but the extent and duration of that impact is uncertain at this time. The Company is monitoring the pandemic and its potential effect on the Company’s financial position, results of operations and cash flows. This uncertainty could have an impact in future periods on certain estimates used in the preparation of the Company’s quarterly financial results, including impairment of intangible assets, the income tax provision and realizability of certain receivables. Should the pandemic continue for an extended period of time, the impact on the Company’s operations could have a material adverse effect on the Company’s revenue, financial condition and cash flows.

INCOME TAXES	3 Months Ended
INCOME TAXES	Mar. 31, 2020
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXES In accordance with ASC 740, Income Taxes, the Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of its assets and liabilities at the enacted tax rates in effect for the year in which the differences are expected to reverse. The Company records a valuation allowance against its net deferred tax asset to reduce the net carrying value to an amount that is more likely than not to be realized. At the end of each interim period, the Company makes its best estimate of the effective tax rate expected to be applicable for the full fiscal year. This estimate reflects, among other items, the Company’s best estimate of operating results and foreign currency exchange rates. The Company also applies the provisions for income taxes related to, among other things, accounting for uncertain tax positions and disclosure requirements. The Company’s recorded liability for uncertain tax positions as of March 31, 2020 has increased by approximately $8,000 as compared to December 31, 2019. There has been no change to the Company’s policy that recognizes potential interest and penalties related to uncertain tax positions. The Company conducts business globally and, as a result, files income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. In the normal course of business, the Company is subject to examination by taxing authorities throughout the world. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (“CARES”) Act was enacted and signed into law. In addition to other provisions, the CARES Act contains modifications to Net Operating Loss (NOL) carryback rules. For the three months ended March 31, 2020, there was no impact to the tax provision related to the CARES Act. We are currently evaluating the provisions of the CARES Act and how other elections may impact our financial position, results of operations, and disclosures, if needed. At December 31, 2019, the Company had U.S. federal NOL carry-forwards of approximately $125,756,000 and state NOL carry-forwards of approximately $172,993,000 available to reduce future taxable income. The Company’s U.S. federal NOL carry-forwards remain fully reserved as of March 31, 2020. Except for the NOLs generated after 2017, the U.S. federal NOLs not fully utilized will expire at various dates between 2029 and 2037; most state NOL carry-forwards will expire at various dates between 2020 and 2039. Under the Tax Cuts and Jobs Act of 2017, U.S. federal NOLs and some state NOLs generated after 2017 will carryforward indefinitely. As of December 31, 2019, the Company had cumulative book losses in foreign subsidiaries of $134,379,000. The Company has not recorded a deferred tax asset for the excess of tax over book basis in the stock of its foreign subsidiaries. The Company anticipates that its foreign subsidiaries will be profitable and have earnings in the future. Once the foreign subsidiaries do have earnings, the Company intends to indefinitely reinvest in its foreign subsidiaries all undistributed earnings of and original investments in such subsidiaries. As a result, the Company has not recorded a deferred tax liability related to excess of book over tax basis in the stock of its foreign subsidiaries in accordance with ASC 740-30-25.

LEASES - Future Minimum Operating Lease Payments (Details) $ in Thousands	Mar. 31, 2020 USD ($)
Leases [Abstract]
2020	$ 499
2021	451
2022	152
2023	152
2024	155
Thereafter	0
Total	1,409
Less amount representing interest	(271)
Total operating lease liabilities	1,138
Operating lease liability, current	(473)
Non-current portion	$ 665

INVENTORY - Narrative (Detail) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Inventory
Component parts	$ 380	$ 389
Work-in-process	220	399
Finished goods	596	602
Total Inventory	$ 1,196	$ 1,390

GOING CONCERN	3 Months Ended
GOING CONCERN	Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
GOING CONCERN	GOING CONCERN The accompanying Interim Financial Statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Interim Financial Statements do not include any adjustments that might result from the outcome of this uncertainty. To date, the Company has incurred recurring losses and negative cash flow from operations and has accumulated a deficit of $388,768,000 from inception through March 31, 2020. As of March 31, 2020, the Company had approximately $12,242,000 in cash and cash equivalents. The Company’s ability to avoid depleting its cash depends upon its ability to maintain revenue and contain its expenses. Should the impact of COVID-19 be extended, the Company has plans in place to reduce its expenses further in the future. Further, the Company must maintain compliance with the debt covenants of its $45,000,000 Loan and Security Agreement and First Amendment dated May 1, 2020 with Solar Capital Ltd. (see Note 10). In management’s opinion, the uncertainty regarding future revenues raises substantial doubt about the Company’s ability to continue as a going concern without access to additional debt and/or equity financing over the course of the next twelve months. To meet the Company’s future working capital needs, the Company may need to raise additional debt or equity financing. While the Company has historically been able to raise additional capital through issuance of equity and/or debt financing, and while the Company has implemented a plan to control its expenses to satisfy its obligations due within one year from the date of issuance of these Interim Financial Statements, the Company cannot guarantee that it will be able to maintain debt compliance, raise additional equity, contain expenses, or increase revenue. Accordingly, there is substantial doubt about the Company’s ability to continue as a going concern within one year after these Interim Financial Statements are issued.

LOAN AGREEMENTS	3 Months Ended
LOAN AGREEMENTS	Mar. 31, 2020
Debt Disclosure [Abstract]
LOAN AGREEMENTS	LOAN AGREEMENTS Hercules Loan Agreement In April 2014, Alimera Sciences Limited (Alimera UK), a subsidiary of the Company, entered into a loan and security agreement (Hercules Loan Agreement) with Hercules Capital, Inc. (Hercules) providing for a term loan of up to $35,000,000 (Hercules Loan). The Company amended the Hercules Loan Agreement several times. On January 5, 2018, the Company paid off the Hercules Loan on behalf of Alimera UK, using the proceeds of the 2018 Solar Loan Agreement described below. 2014 Warrant In connection with Alimera UK entering into the Hercules Loan Agreement, the Company issued a warrant that granted Hercules the right to purchase up to 19,002 shares of the Company’s common stock at an exercise price of $92.10 per share (the 2014 Warrant). The Company amended the 2014 Warrant a number of times to increase the number of shares issuable upon exercise to 83,933 and decrease the exercise price to $20.85 per share. The right to exercise this warrant expires on November 2, 2020. 2016 Warrant In connection with Alimera UK entering into an amendment to the Hercules Loan Agreement on October 20, 2016, the Company agreed to issue a new warrant to Hercules (the 2016 Warrant) that granted Hercules the right to purchase up to 30,582 shares of the Company’s common stock at an exercise price of $16.35 per share. The right to exercise this warrant expires on October 20, 2021. Solar Capital Loan Agreement On January 5, 2018, the Company entered into a $40,000,000 Loan and Security Agreement (the 2018 Solar Loan Agreement) with Solar Capital Ltd. (Solar Capital), as Collateral Agent (Agent), and the parties signing the 2018 Solar Loan Agreement from time to time as Lenders, including Solar Capital in its capacity as a Lender (collectively, the Lenders). Under the 2018 Solar Loan Agreement, the Company borrowed the entire $40,000,000 as a term loan (the 2018 Solar Loan) that was scheduled to mature on July 1, 2022. The Company paid Solar Capital a $400,000 fee at the closing of the 2018 Solar Loan Agreement. The Company repaid the 2018 Solar Loan on December 31, 2019 with a new loan agreement with Solar Capital as described below. The Company used the proceeds of the 2018 Solar Loan to extinguish (prepay) the Hercules Loan Agreement and pay related expenses. The Company used the remaining loan proceeds to provide additional working capital for general corporate purposes. Interest on the 2018 Solar Loan was payable at one-month LIBOR plus 7.65% per annum. The 2018 Solar Loan Agreement provided for interest only payments through the date of repayment. As of the final interest payment on the 2018 Solar Loan, the interest rate was approximately 9.3%. The Company agreed, for itself and its subsidiaries, to customary affirmative and negative covenants and events of default in connection with the 2018 Solar Loan Agreement. 2018 Exit Fee Agreement Notwithstanding the repayment of the 2018 Solar Loan, the Company remains obligated to pay additional fees under the Exit Fee Agreement (2018 Exit Fee Agreement) dated as of January 5, 2018 by and among the Company, Solar Capital as Agent, and the Lenders. The 2018 Exit Fee Agreement survived the termination of the 2018 Solar Loan Agreement upon the repayment of the 2018 Solar Loan and has a term of 10 years. The Company is obligated to pay up to, but no more than, $2,000,000 in fees under the 2018 Exit Fee Agreement. 2019 Solar Capital Loan Agreement On December 31, 2019, the Company entered into a $45,000,000 Loan and Security Agreement (the 2019 Solar Loan Agreement) with Solar Capital, as Agent, and the parties signing the 2019 Solar Loan Agreement from time to time as Lenders, including Solar Capital in its capacity as a Lender (collectively, the Lenders). Under the 2019 Solar Loan Agreement, the Company borrowed $42,500,000 on December 31, 2019 and subsequent to December 31, 2019, the Company borrowed the remaining $2,500,000 on February 21, 2020 (the two borrowings totaling $45,000,000 are referred to as the 2019 Solar Loan). The 2019 Solar Loan matures on July 1, 2024. As noted above, the Company used the initial proceeds of the 2019 Solar Loan to pay off the 2018 Solar Loan, along with related prepayment, legal and other fees and expenses of approximately $2,278,000, which included a $1.8 million fee to Solar Capital upon repayment of the 2018 Solar Loan that was previously accrued and a $400,000 prepayment fee to Solar Capital that was capitalized as deferred financing costs. The Company expects to use the remaining loan proceeds to provide additional working capital for general corporate purposes. Interest on the 2019 Solar Loan is payable at the greater of (i) one-month LIBOR or (ii) 1.78%, plus 7.65% per annum. As of December 31, 2019, the 2019 Solar Loan’s interest rate is 9.43%. The 2019 Solar Loan provides for interest only payments until January 1, 2023. If the Company meets certain revenue thresholds and no event of default shall have occurred and is continuing, the Company can extend the interest only period an additional six months, ending on June 30, 2023, followed by one year of monthly payments of principal and interest. The Company paid the Lenders a non-refundable facility fee in the amount of $25,000 on February 21, 2020. In addition, the Company is obligated to pay a $2,250,000 fee upon repayment of the 2019 Solar Loan. First Amendment to 2019 Solar Capital Loan Agreement On May 1, 2020, the Company entered into a First Amendment (the Amendment) to its 2019 Solar Loan Agreement with Solar Capital. The Amendment, among other things: (a)eliminates the previous requirement that the following covenant (the Revenue Covenant) be measured at June 30, 2020 and September 30, 2020: the Company shall not permit revenues (under U.S. GAAP) from the sale of ILUVIEN in the ordinary course of business to third party customers, on a trailing six-month basis, to be less than a specified minimum revenue amount for each such date; (b)requires that the Revenue Covenant be measured at November 30, 2020 and specifies a new minimum revenue amount in that regard; (c)requires that the Revenue Covenant be measured at December 31, 2020 and specifies a new minimum revenue amount in that regard; and (d)requires that the Revenue Covenant be measured at March 31, 2021 and at the last day of each quarter thereafter, with the minimum revenue amount equal to a percentage of the Company’s projected revenues in accordance with an annual plan submitted by the Company to Agent by January 15th of such year, such plan to be approved by the Company’s board of directors and Agent in its sole discretion. The Amendment also adds the following new minimum liquidity requirement that is in effect from May 1, 2020 until the Company notifies Agent that it has met the Revenue Covenant at November 30, 2020: the Company shall not permit the aggregate amount of unrestricted cash and cash equivalents to be less than the sum of (i) $8,500,000 plus (ii) the amount of the Company’s accounts payable that have not been paid within 90 days from the invoice date of the relevant account payable. We paid no fees to Solar Capital; however, we agreed to reimburse Agent for its legal fees. Modification of Debt In accordance with the guidance in ASC 470-50, Debt, the Company entered into and accounted for the 2019 Solar Loan Agreement as a modification and capitalized approximately $427,000 of costs as additional deferred financing costs and expensed approximately $76,000 of costs incurred with third parties within the consolidated statements of operations for the year ended December 31, 2019. Fair Value of Debt The weighted average interest rates of the Company’s notes payable approximate the rate at which the Company could obtain alternative financing. Therefore, the carrying amount of the notes approximated their fair value at March 31, 2020 and December 31, 2019.

GOING CONCERN - Narrative (Detail) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Accumulated deficit	$ 388,768,000	$ 387,570,000
Cash and cash equivalents	$ 12,242,000	9,426,000
2019 Solar Loan Agreement \| Solar Capital
Debt Instrument [Line Items]
Debt instrument, face amount		$ 45,000,000

LEASES - Operating Lease Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
NON-CURRENT ASSETS:
Operating lease, right-of-use asset	$ 967	$ 1,107
CURRENT LIABILITIES:
Operating lease liability, current	473
NON-CURRENT LIABILITIES:
Operating lease liability, noncurrent	665
Total operating lease liabilities	$ 1,138

NATURE OF OPERATIONS - Narrative (Detail) - ILUVIEN	Mar. 31, 2020 country
Nature Of Operations [Line Items]
Number of countries in which product is indicated for the treatment of vision impairment associated with chronic DME considered insufficiently responsive to available therapies	17
Number of countries in which product is indicated for prevention of relapse in recurrent non-infectious uveitis affecting the posterior segment of the eye	16

SUBSEQUENT EVENTS - Narrative (Details) - Paycheck Protection Plan - Notes Payable to Banks - Subsequent Event	Apr. 22, 2020 USD ($)
Subsequent Event [Line Items]
Debt instrument, face amount	$ 1,800,000.0
Debt instrument, interest rate, stated percentage	1.00%

EARNINGS (LOSS) PER SHARE (EPS) - Antidilutive Securities Excluded from the Computation of Diluted Earnings Per Share (Details) - shares	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	2,464,453	2,324,009
Series A convertible preferred stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	601,504	601,504
Series C convertible preferred stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	676,667	676,667
Common stock warrants \| Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	119,712	119,712
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	1,036,484	894,097
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	30,086	32,029

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Income Statement [Abstract]
NET REVENUE	$ 14,535	$ 12,890
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION	(1,927)	(1,600)
GROSS PROFIT	12,608	11,290
RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES	2,883	2,727
GENERAL AND ADMINISTRATIVE EXPENSES	3,181	3,393
SALES AND MARKETING EXPENSES	5,672	5,913
DEPRECIATION AND AMORTIZATION	654	652
OPERATING EXPENSES	12,390	12,685
NET INCOME (LOSS) FROM OPERATIONS	218	(1,395)
INTEREST EXPENSE AND OTHER	(1,292)	(1,228)
UNREALIZED FOREIGN CURRENCY LOSS, NET	(81)	(69)
NET LOSS BEFORE TAXES	(1,155)	(2,692)
PROVISION FOR TAXES	(43)	(71)
NET LOSS	$ (1,198)	$ (2,763)
NET (LOSS) INCOME PER COMMON SHARE — Basic and diluted (in dollars per share)	$ (0.24)	$ (0.59)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING — Basic and diluted (in shares)	4,980,722	4,716,054

LOAN AGREEMENTS - 2014 Warrant Narrative (Details) - Alimera Sciences, Inc.(Company) - Hercules Technology Growth Capital, Inc. - $ / shares	Mar. 31, 2020	Apr. 30, 2014
2014 Term Loan
Debt Instrument [Line Items]
Class of warrant or right, number of securities called by warrants or rights (in shares)		19,002
Class of warrant or right, exercise price of warrants or rights (usd per share)		$ 92.10
July 2016 Waiver
Debt Instrument [Line Items]
Class of warrant or right, number of securities called by warrants or rights (in shares)	83,933
Class of warrant or right, exercise price of warrants or rights (usd per share)	$ 20.85

INTANGIBLE ASSET - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2014	Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]
Net intangible assets	$ 14,299			$ 14,783
License
Finite-Lived Intangible Assets [Line Items]
Gross intangible assets	$ 25,000
Useful life (in years)	13 years
Amortization of intangible assets	$ 484	$ 478
Net intangible assets	$ 14,299
pSivida
Finite-Lived Intangible Assets [Line Items]
Milestone payment after the first product approved by the FDA			$ 25,000