Adicet Bio, Inc. 10-K

Item 9A. Controls and Procedures. Evaluation of disclosure controls and procedures Our management, with the participation of our Chief Executive Officer (CEO) and our Chief Financial Officer (CFO) (our principal executive officer and principal financial officer, respectively), evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2024. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures. These limitations include the possibility of human error, the circumvention or overriding of the controls and procedures and reasonable resource constraints. In addition, because we have designed our system of controls based on certain assumptions, which we believe are reasonable, about the likelihood of future events, our system of controls may not achieve its desired purpose under all possible future conditions. Accordingly, our disclosure controls and procedures provide reasonable assurance, but not absolute assurance, of achieving their objectives. Management's Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over our financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act). Our internal control over financial reporting is designed to provide reasonable assurances regarding the reliability of financial reporting and the preparation of our consolidated financial statements in accordance with U.S. GAAP, and includes those policies and procedures that: • Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; • Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorization of management and directors of the Company; and • Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree or compliance with the policies or procedures may deteriorate. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, assessed our internal control over financial reporting as of December 31, 2024. Management based its assessment on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and concluded that our internal control over financial reporting was not effective at the reasonable assurance level as of December 31, 2024 due to the material weakness in our internal control over financial reporting which relates to cash disbursements 106 described below. However, after giving full consideration to this material weakness, and the additional analyses and other procedures that we performed to ensure that our consolidated financial statements included in this Annual Report on Form 10-K were prepared in accordance with U.S. GAAP, our management has concluded that our consolidated financial statements present fairly, in all material respects, our financial position, results of operations and cash flows for the periods disclosed in conformity with U.S. GAAP. This Annual Report on Form 10-K does not include an attestation report from our registered public accounting firm regarding internal control over financial reporting. As we are a non-accelerated filer, management’s report is not subject to attestation by our registered public accounting firm. We cannot assure you that material weaknesses or significant deficiencies will not occur in the future or that we will be able to remediate such weaknesses or deficiencies in a timely manner, which could impair our ability to accurately and timely report our financial position, results of operations or cash flows. For additional information, see the related risks in the section entitled " Risk Factors " of this Annual Report on Form 10-K. In connection with the audit of our financial statements as of and for the years ended December 31, 2024 and 2023, we identified a material weakness in our internal control over financial reporting. The material weakness we identified was as follows: • In September and October 2024, certain employee business email accounts were compromised by an unauthorized third party, and as a result, payments intended for certain vendors were fraudulently re-directed into bank accounts presumably controlled by the unauthorized third party. As a result of the foregoing, we identified a material weakness due to our internal controls having not been adequately designed to prevent or timely detect unauthorized cash disbursements. Remediation of Material Weakness in Internal Control over Financial Reporting During the preparation of this Annual Report on Form 10-K, our management has implemented certain additional substantive and analytical review procedures to ensure that information required to be disclosed by us in this report is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms. Our management, under the supervision of our CEO and CFO, has undertaken a plan to remediate the material weakness identified above. We have fully implemented certain remediation efforts that are intended to address the identified material weakness. Specifically, we have added controls within the cash disbursements process that are designed to properly authenticate changes to vendor banking information as well as provide additional layers of review and approval of these changes prior to cash disbursement. As of the date of this Annual Report on Form 10-K, we believe that the remediation steps taken have been sufficient to remediate the material weakness. Changes in Internal Control over Financial Reporting Other than as stated above, no change in our internal control over our financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the year ended December 31, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Item 9B. Other Information. ( a) None . (b) On December 13, 2024 , Francesco Galimi , our former Chief Medical Officer , terminated a trading plan pursuant to Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. Dr. Galimi’s Rule 10b5-1 trading plan, adopted on November 1, 2024 , provided for the sale from time to time of a maximum of 400,000 shares of our common stock pursuant to the terms of the plan. If Dr. Galimi’s Rule 10b5-1 trading plan had not been terminated, it would have expired on November 3, 2025 , or earlier if all transactions under the trading arrangement were completed. The trading arrangement is intended to satisfy the affirmative defense in Rule 10b5-1(c). Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections. Not applicable. 107 PART III Item 10. Directors, Executive Of ficers and Corporate Governance. The following table sets forth information about our directors and executive officers as of March 6, 2025. Name Position Held with Adicet Officer Since Age Executive Officers Chen Schor, MBA President, Chief Executive Officer and Director 2020 52 Blake Aftab, Ph.D. Chief Scientific Officer 2021 43 Nick Harvey, MBA Chief Financial Officer 2020 64 Donald Healey, Ph.D. Chief Technology Officer 2020 63 Julia Maltzman, M.D. Chief Medical Officer 2025 57 Non-Employee Directors Jeffrey Chodakewitz, M.D. (2) Director 2020 69 Steve Dubin, J.D. (1)(3) Director 2020 71 Carl L. Gordon, Ph.D. (2) Director 2015 60 Aya Jakobovits, Ph.D. (2) Director 2014 72 Lloyd Klickstein, M.D., Ph.D. (3) Director 2024 61 Katie Peng, MBA (1) Director 2023 54 Andrew Sinclair, Ph.D. (1)(3) Director 2021 53 (1) Member of the Audit Committee. (2) Member of the Compensation Committee. (3) Member of the Nominating and Corporate Governance Committee. Executive Officers Chen Schor, MBA has served as our President and Chief Executive Officer and as a member of our board of directors since the completion of the Merger. Previously, he held the role of director, President and Chief Executive Officer at resTORbio since co-founding the company in 2016. Mr. Schor previously served as President, Chief Executive Officer and director of Synta Pharmaceuticals Corp. from May 2015 until its merger with Madrigal Pharmaceuticals, Inc. in July 2017, and prior to that, from 2014 until 2016, Mr. Schor served as the company’s Executive Vice President and Chief Operation Officer. From September 2012 to December 2014, Mr. Schor served as President and Chief Executive Officer of Novalere FP, Inc. From September 2011 to October 2012, Mr. Schor served as Chief Business Officer of Eleven Biotherapeutics, Inc. From March 2009 until September 2011, Mr. Schor served as Vice President of Business Development, global branded products at Teva Pharmaceutical Industries Limited (NYSE: TEVA). Mr. Schor currently serves on the board of the Alliance for Cancer Gene Therapy, a non-for-profit organization committed to advancing new cancer cell and gene therapies. He is also chair of the board of directors of Carbon Biosciences, Inc., a member of the board of directors of Karyopharm Therapeutics Inc. (Nasdaq: KPTI) since December 2020, and previously served on the board of Brainstorm Cell Therapeutics Inc. (Nasdaq: BCLI) from September 2011 to April 2020. Mr. Schor received his MBA. from Tel Aviv University, a B.A. in Economics and Accounting from Haifa University and a B.A. in Biology from Tel Aviv University. We believe that Mr. Schor is qualified to serve on our board of directors due to his service as our President and Chief Executive Officer and his extensive knowledge of our company and industry. Blake Aftab, Ph.D. has served as our Chief Scientific Officer since October 2021 and previously served as Vice President of Research and Development since April 2021. Prior to Adicet, Dr. Aftab worked at Atara Biotherapeutics, Inc. (Atara) (Nasdaq: ATRA), where he served as Vice President and Head of Preclinical and Translational Sciences and other various leadership roles from April 2015 to March 2021. During his tenure at Atara, Dr. Aftab was responsible for research strategy and execution of Atara’s preclinical science and translational medicine activities. Prior to that, Dr. Aftab held various roles of increasing responsibility at the University of California, San Francisco School of Medicine from October 2012 to August 2015. Dr. Aftab received his Ph.D. from the John Hopkins University School of Medicine and holds a B.S. in Pharmacology from the University of California. Nick Harvey, MBA has served as our Chief Financial Officer since the completion of the Merger. Previously, he served as the Chief Financial Officer since July 2018 and the Executive Vice President and Treasurer since October 2018 of Centrexion Therapeutics Corporation until December 2019, then as Senior Advisor through January 2020. From June 2017 108 through June 2018, he served as an independent consultant to private and public life science companies. Prior to that, Mr. Harvey served as the Chief Financial Officer of Radius Health Inc. (acquired by Gurnet Point Capital and Patient Square Capital) from December 2006 to May 2017. Mr. Harvey received a Bachelor of Economics degree and a Bachelor of Laws degree with first-class honors from the Australian National University and an MBA from the Harvard Business School. Donald Healey, Ph.D. has served as our Chief Technology Officer since October 2020. From February 2017 to October 2020, Dr. Healey served as the Senior Vice President, Operations and Site Head for KBI Biopharma, Inc., a biopharmaceutical contract services organization. From April 2010 to February 2017, Dr. Healey held multiple roles including Chief Scientific Officer at Opexa Therapeutics, Inc., where he was responsible for all pre-clinical scientific development, closed-system process design and the scaling of Opexa’s autologous T-cell immunotherapy. From March 2001 to April 2010, Dr. Healey held various positions at Argos Therapeutics, Inc. and ML Laboratories, UK, (formerly Cobra Therapeutics Ltd.). Dr. Healey received his Ph.D. in Cellular Immunology from University of London, and holds a B.Sc. in Cellular Pathology from Bristol University. Julia Maltzman, M.D. has served as our Chief Medical Officer since January 2025. Previously, she served as Chief Medical Officer since September 2022 of IconOVir Bio, Inc from September 2022 to January 2025 where she was leading, designing and executing a clinical development program focused on refractory solid tumors. Prior to that, she held leadership roles at Roche/Genentech, Inc., as VP, Global Head of GI Cancers and Cancer Immunotherapy at Roche/Genentech, Inc. from 2020 to November 2022, and as Group Medical Director, Cancer Immunotherapy, from 2018 to 2020. Dr. Maltzman received her M.D. from the University of Colorado, completed her Internship and Residency in the Department of Internal Medicine at the University of Chicago, and completed a Fellowship in the Division of Hematology/Oncology at the University of Pennsylvania. Dr. Maltzman holds a B.A. in Political Science from the University of Colorado. Non-Employee Directors Jeffrey Chodakewitz, M.D. has served as a member of our board of directors since the completion of the Merger and previously served as a member of the board of directors of resTORbio since August 2018. Since October 2022, Dr. Chodakewitz has served as Entrepreneur-in-Residence at Yale University Ventures and since December 2022, he has served as Advisory Partner of Ascenta Capital Management LLC. From March 2019 to January 2022, Dr. Chodakewitz served as a senior/executive advisor at Blackstone Life Sciences. From April 2018 through March 2019, Dr. Chodakewitz served as Executive Vice President, Clinical Medicine and External Innovation, at Vertex Pharmaceuticals Incorporated (Vertex) (Nasdaq: VRTX). Prior to that role, Dr. Chodakewitz held the roles of Chief Medical Officer and Executive Vice President, Global Medicines Development and Medical Affairs at Vertex from January 2014 to April 2018 and was a member of the Vertex Executive Committee. From December 1990 to December 2013, he worked at Merck & Co., Inc. (NYSE: MRK), where he served in a number of positions including Head of Infectious Diseases and Vaccines Global Development from August 2013 to December 2013, Senior Vice President of Global Scientific Strategy (Infectious Disease, Respiratory & Immunology) from January 2013 to August 2013 and Senior Vice President of Late Stage Development from March 2011 to January 2013. Dr. Chodakewitz is a Diplomate of the National Board of Medical Examiners and the American Board of Internal Medicine (both Internal Medicine and Infectious Disease). Dr. Chodakewitz has served as a member of the board of directors of Praxis Precision Medicines, Inc. (Nasdaq: PRAX) since April 2021, Schrodinger, Inc. (Nasdaq: SDGR) since April 2020. Dr. Chodakewitz previously served on the board of Freeline Therapeutics Holdings plc. (formerly Nasdaq: FRLN) from September 2019 to February 2024, and of public company Tetraphase Pharmaceuticals Inc. (formerly Nasdaq: TTPH) from June 2014 to July 2020, which was acquired by La Jolla Pharmaceutical Company in July 2020. He holds a B.S in Biochemistry cum laude from Yale University and an M.D. from the Yale University School of Medicine. We believe Dr. Chodakewitz is qualified to serve on our board of directors because of his extensive experience working for various pharmaceutical and biotechnology companies. Steve Dubin, J.D. has served as a member of our board of directors since the completion of the Merger. Since November 2011, Mr. Dubin has been a Principal in SDA Ventures LLC, a firm focused on assisting emerging growth and middle-market companies, primarily in the health & wellness and nutritional products markets, on matters including corporate development, business acquisition, customer relations, growth strategies and corporate finance. From 2006 until its acquisition by Koninklijke DSM N.V. (DSM) in February 2011, Mr. Dubin served as Chief Executive Officer and a member of the board of directors of Martek Biosciences Corporation (Martek). He later served as President of DSM’s Nutritional Lipids Division from February 2011 through October 2011 and as a Senior Advisor to DSM Nutritional Products from November 2011 through October 2012. After joining Martek in 1992 and serving in various management positions, including Chief Financial Officer, Treasurer, Secretary, General Counsel and Senior Vice President, Business Development, he served as President of Martek from 2003 to 2006. Mr. Dubin currently serves as a member of the board of directors of privately held companies Triton Algae Innovations, Ltd., Phytolon LTD and Exosomm LTD. From May 2013 to March 2024, Mr. Dubin served on the board of directors of Alcresta Therapeutics, Inc. Mr. Dubin is a certified public accountant and a member of the Maryland Bar. He holds a bachelor’s degree in accounting from the University of Maryland and a J.D. from the National Law Center at George 109 Washington University. We believe Mr. Dubin is qualified to serve on our board of directors because of his accounting experience and extensive experience working with emerging growth and middle-market companies. Carl L. Gordon, Ph.D., CFA has served as a member of our board of directors since the completion of the Merger and previously served as a member of the board of directors of Former Adicet since August 2015. Dr. Gordon is a Managing Partner at OrbiMed Advisors LLC, an investment firm. Dr. Gordon has served on the boards of directors of ArriVent Biopharma, Inc. (Nasdaq: AVBP) since December 2022, Compass Therapeutics, Inc. (Nasdaq: CMPX) since September 2015, Keros Therapeutics, Inc. (Nasdaq: KROS) since March 2020, Lomond Therapeutics Holdings, Inc. (trading on OTC) since August 2024, and MBX Biosciences, Inc. (Nasdaq: MBX) since July 2020, as well as several private companies. Dr. Gordon previously served on the boards of directors of Gemini Therapeutics, Inc. (which merged with Disc Medicine, Inc.) from April 2016 to December 2022, Kinnate Biopharma, Inc. (Nasdaq: KNTE) from December 2019 to April 2024, ORIC Pharmaceuticals, Inc. (Nasdaq: ORIC) from November 2015 to November 2021, Prevail Therapeutics Inc. (acquired by Eli Lilly and Company) from October 2017 to January 2021, Terns Pharmaceuticals, Inc. (Nasdaq: TERN) from October 2018 to February 2025, Theseus Pharmaceuticals, Inc. (Nasdaq: THRX) from June 2018 to February 2024, and Turning Point Therapeutics, Inc. (acquired by Bristol-Myers Squibb Company) from May 2017 to November 2020. Dr. Gordon received a B.A. in Chemistry from Harvard College, a Ph.D. in Molecular Biology from the Massachusetts Institute of Technology, and was a Fellow at The Rockefeller University. We believe Dr. Gordon is qualified to serve as the Chairperson of our board of directors because of his venture capital experience, expertise in the scientific field of molecular biology and financial credentials. Aya Jakobovits, Ph.D. has served as a member of our board of directors since the completion of the merger of resTORbio, Inc. (resTORbio) and Adicet Bio, Inc. (when referred to prior to the Merger, Former Adicet) in September 2020 (the Merger) and previously served as a member of the board of directors of Former Adicet since November 2014. Dr. Jakobovits founded Former Adicet and served as President and Chief Executive Officer from its incorporation until February 2018. From February 2018 until February 2019, Dr. Jakobovits served as a senior strategic advisor to Former Adicet. Prior to starting Former Adicet, Dr. Jakobovits served as a Venture Partner with OrbiMed Advisors LLC from 2011 to 2016. From September 2010 to December 2013, she served as President and Founding Chief Executive Officer of Kite Pharma Inc. From December 2007 to June 2010, she served as Executive Vice President, Head of Research and Development at Agensys Inc. (Agensys), an affiliate of Astellas Pharma, Inc. (Astellas). Before Agensys’ acquisition by Astellas, she served as Agensys’ Senior Vice President, Technology and Corporate Development and Chief Scientific Officer and led its research, development, clinical and corporate development operations from January 1999 to December 2007. Before Agensys, from 1996 to 1999, Dr. Jakobovits served as Director, Discovery Research and Principal Scientist at Abgenix Inc. (acquired by Amgen Inc.) which was spun out of Cell Genesys, Inc. (Cell Genesys) in 1996 based on the XenoMouse® technology developed under her leadership. She joined Cell Genesys in 1989 and served ultimately as Director, Molecular Immunology. Dr. Jakobovits currently serves on the boards of directors of Dorian Therapeutics Inc. She served on the board of UCLA Technology Development Corporation from 2017 to 2022 and on the board of Yeda Research and Development Co. Ltd. From 2019 to 2023. Dr. Jakobovits received her B.Sc. from the Hebrew University of Jerusalem, her M.Sc. in Chemistry and Ph.D. in Life Sciences from the Weizmann Institute of Sciences, Israel, and was a postdoctoral fellow at University of California, San Francisco and at Genentech, Inc. (Genentech). We believe Dr. Jakobovits is qualified to serve on our board of directors because of her expertise, experience, and track record in forming and growing successful companies and in developing immunotherapy platform technologies and oncology products. Lloyd Klickstein, M.D., Ph.D. has served as a member of our board of directors since August 2024. Dr. Klickstein has served as president and chief executive officer of Koslapp Therapeutics, Inc. since April 2024. From February 2021 to March 2024, Dr. Klickstein served as the founding chief executive officer and subsequently as president and chief executive officer of Versanis Bio, Inc., a biopharmaceutical company that addressed medical conditions prevalent in older adults. Previously, Dr. Klickstein served as chief innovation officer of Adicet Bio from September 2020 to February 2021 and as chief scientific officer of resTORbio from May 2018 to September 2020. Prior to joining resTORbio, Dr. Klickstein was Head of Translational Medicine for the New Indication Discovery Unit (NIDU) and the Exploratory Disease Area (DAx) at Novartis Institutes for Biomedical Research. Dr. Klickstein received his B.S. degree from Tufts University, his M.D. and Ph.D. degrees from Harvard University, completed post-graduate clinical training in Internal Medicine, Rheumatology & Immunology at BWH and a post-doctoral research fellowship at the Center for Blood Research in Boston. We believe Dr. Klickstein is qualified to serve on our board of directors because of his expertise and experience working for various pharmaceutical and biotechnology companies. Katie Peng, MBA has served as a member of our board of directors since July 2023. Since September 2021, Ms. Peng has served as Chief Commercial Officer at Denali Therapeutics Inc. (Nasdaq: DNLI). From April 2017 to September 2021, Ms. Peng served as the Senior Vice President, Head of the Ophthalmology, Metabolism, Neurosciences, Immunology Business Unit at Genentech, where she was responsible for the oncology, neurology, and rare diseases portfolio, and served as part of Genentech’s commercial leadership team. From February 2012 to April 2017, Ms. Peng held a number of senior leadership 110 positions at Roche Holding AG (Roche), managing the Roche portfolio in the Asia Pacific region as the General Manager of two countries. Ms. Peng has also served as a member of the board of directors of Scholar Rock Holding Corporation (Nasdaq: SRRK) since February 2024, and serves as a board member for the nonprofit organization California Life Sciences. She holds a B.A. from the University of California, Berkeley and an MBA from the Kelley School of Business, Indiana University. We believe Ms. Peng is qualified to serve on our board of directors because of her expertise and experience working for various pharmaceutical and biotechnology companies. Andrew Sinclair, Ph.D. has served as a member of our board of directors since March 2021. Dr. Sinclair is currently a partner at Abingworth LLP (Abingworth), a life sciences investment group. He has been at Abingworth since November 2008 where he has served in various positions focusing on investments in public and private biotech and pharmaceutical companies. Prior to joining Abingworth, he was senior equity analyst, director at HSBC Global Markets, where he was responsible for investment research in the mid-cap pharmaceutical sector. Previously, Dr. Sinclair held biotechnology analyst positions at Credit Suisse and SG Cowen. Dr. Sinclair has served on the board of directors of Soleno Therapeutics, Inc. (Nasdaq: SLNO) since December 2018 and previously served on the boards of directors of Sierra Oncology, Inc. (acquired by GSK plc) from November 2019 to July 2022, and Verona Pharma plc (Nasdaq: VRNA) from July 2016 to April 2022. Dr. Sinclair received his B.Sc. in Microbiology from King's College London and his Ph.D. in Chemistry and Genetic Engineering at the BBSRC Institute of Plant Science, Norwich, United Kingdom. Dr. Sinclair qualified as a chartered accountant, formerly with KPMG LLP. We believe Dr. Sinclair is qualified to serve on our board of directors due to his extensive background in strategic development within the biotechnology and pharmaceutical industries. Family Relationships and Legal Proceedings There are no family relationships between or among any of our directors or executive officers. Our executive officers are appointed by, and serve at the discretion of, our board of directors. The principal occupation and employment during the past five years of each of our directors was carried on, in each case except as specifically identified above, with a corporation or organization that is not a parent, subsidiary or other affiliate of us. There is no arrangement or understanding between any of our directors and any other person or persons pursuant to which he or she is to be selected as a director. There are no material legal proceedings to which any of our directors, officers or affiliate, any owner of record or beneficially of more than five percent of any class of our voting securities, or any associate of any such director, officer, affiliate, or security holder is a party adverse to us or any of our subsidiaries or in which any such person has a material interest adverse to us or our subsidiary. Code of Business Conduct and Ethics We have adopted a code of business conduct and ethics for directors, officers, and employees, known as the Code of Business Conduct and Ethics. The Code of Business Conduct and Ethics is available on our website at https://investor.adicetbio.com/corporate-governance/governance-highlights . We will promptly disclose on our website (i) the nature of any amendment to the policy that applies to our principal executive officer, principal financial officer, or controller, or persons performing similar functions and (ii) the nature of any waiver, including an implicit waiver, from a provision of the policy that is granted to one of these specified individuals, the name of such person who is granted the waiver and the date of the waiver. Shareholders may request a free copy of the Code of Business Conduct and Ethics from our Compliance Officer, c/o Adicet Bio, Inc., 131 Dartmouth Street, 3rd Floor, Boston, Massachusetts 02116. Recommendation of Director Nominees by Stockholders There have been no material changes to the procedures by which our stockholders may recommend nominees to the Board. Board Committees Our board of directors has established an Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee. Each of the Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee operates under a charter that satisfies the applicable standards of the SEC and Nasdaq. Each such committee reviews its respective charter at least annually. A current copy of the charter for each of the Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee is posted on the corporate governance section of our website, investor.adicetbio.com/corporate-governance/governance-highlights . 111 Audit Committee Our Audit Committee is composed of Steve Dubin, Katie Peng, and Andrew Sinclair, Ph.D. Currently, the Audit Committee is chaired by Mr. Dubin. Our board of directors has determined that each member of the Audit Committee is “independent” for Audit Committee purposes as that term is defined in the rules of the SEC and the applicable Nasdaq rules, and each has sufficient knowledge in financial and auditing matters to serve on the Audit Committee. Our board of directors has designated Steve Dubin as an “audit committee financial expert,” as defined under the applicable rules of the SEC. During the fiscal year ended December 31, 2024, the Audit Committee met five times. The Audit Committee’s responsibilities include: o appointing, approving the compensation of, and assessing the independence of our independent registered public accounting firm; o pre‑approving auditing and permissible non‑audit services, and the terms of such services, to be provided by our independent registered public accounting firm; o reviewing the overall audit plan with our independent registered public accounting firm and members of management responsible for preparing our financial statements; o reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements and related disclosures as well as critical accounting policies and practices used by us; o coordinating the oversight and reviewing the adequacy of our internal control over financial reporting; o establishing policies and procedures for the receipt and retention of accounting‑related complaints and concerns; o recommending based upon the Audit Committee’s review and discussions with management and our independent registered public accounting firm whether our audited financial statements shall be included in our Annual Report on Form 10‑K; o monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial statements and accounting matters; o preparing the Audit Committee report required by SEC rules to be included in our annual proxy statement; o reviewing all related person transactions for potential conflict of interest situations and approving all such transactions; o reviewing quarterly earnings releases; and o overseeing our cybersecurity risk management program. All audit and non-audit services, other than de minimis non-audit services, to be provided to us by our independent registered public accounting firm must be approved in advance by our Audit Committee. Compensation Committee Carl L. Gordon, Ph.D., Jeffrey Chodakewitz, M.D., and Aya Jakobovits, Ph.D. serve on the Compensation Committee, which is chaired by Dr. Gordon. Our board of directors has determined that each member of the Compensation Committee is “independent” as defined in the applicable Nasdaq rules. During the fiscal year ended December 31, 2024, the Compensation Committee met seven times and acted by written consent twice. The Compensation Committee’s responsibilities include: o annually reviewing and recommending to the board of directors corporate goals and objectives relevant to the compensation of our chief executive officer; o evaluating the performance of our chief executive officer in light of such corporate goals and objectives and determine the compensation of our chief executive officer; 112 o reviewing and approving the compensation of our other executive officers; o reviewing and establishing our overall management compensation, philosophy, and policy; o reviewing and making recommendations to the board regarding our compensation and similar plans; o evaluating and assessing potential and current compensation advisors in accordance with the independence standards identified in the applicable Nasdaq rules; o retaining and approving the compensation of any compensation advisors; o reviewing and making recommendations to our board of directors about our policies and procedures for the grant of equity‑based awards; o evaluating and making recommendations to the board of directors about director compensation; o preparing the Compensation Committee report required by SEC rules, if and when required, to be included in our annual proxy statement; o reviewing and approving the retention or termination of any consulting firm or outside advisor to assist in the evaluation of compensation matters; and o reviewing and discussing with the board of directors corporate succession plans for our chief executive officers and our other key officers. Nominating and Corporate Governance Committee Since August 19, 2024, Dr. Sinclair, Lloyd Klickstein, M.D., Ph.D., and Mr. Dubin have served on the Nominating and Corporate Governance Committee, which is chaired by Dr. Sinclair. Our board of directors has determined that each member of the Nominating and Corporate Governance Committee is “independent” as defined in the applicable Nasdaq rules. During the fiscal year ended December 31, 2024, the Nominating and Corporate Governance Committee met twice times and acted by written consent once. The Nominating and Corporate Governance Committee’s responsibilities include: o developing and recommending to the board of directors criteria for board and committee membership; o establishing procedures for identifying and evaluating board of director candidates, including nominees recommended by stockholders; o reviewing the size and composition of the board of directors to ensure that it is composed of members containing the appropriate skills and expertise to advise us; o identifying individuals qualified to become members of the board of directors; o recommending to the board of directors the persons to be nominated for election as directors and to each of the board of directors’ committees; o developing and recommending to the board of directors a code of business conduct and ethics and a set of corporate governance guidelines; and o overseeing the annual evaluation of our board of directors and management. The Nominating and Corporate Governance Committee considers candidates for Board of Director membership suggested by its members and the Chief Executive Officer. Additionally, in selecting nominees for directors, the Nominating and Corporate Governance Committee will review candidates recommended by stockholders in the same manner and using the same general criteria as candidates recruited by the committee and/or recommended by our board of directors. Any stockholder who wishes to recommend a candidate for consideration by the committee as a nominee for director should follow the procedures which will be described in our 2025 Proxy Statement, which we intend to file with the SEC within 120 days of the 113 end of our fiscal year pursuant to General Instruction G(3) of Form 10-K. The Nominating and Corporate Governance Committee will also consider whether to nominate any person proposed by a stockholder in accordance with the provisions of our bylaws relating to stockholder nominations which will be described in our 2025 Proxy Statement, which we intend to file with the SEC within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K. Identifying and Evaluating Director Nominees. Our board of directors is responsible for filling vacancies on our board of directors and for nominating candidates for election by our stockholders each year in the class of directors whose term expires at the relevant annual meeting. The board of directors delegates the selection and nomination process to the Nominating and Corporate Governance Committee, with the expectation that other members of the board of directors, and of management, will be requested to take part in the process as appropriate. Our Nominating and Corporate Governance Committee Policies and Procedures for Director Candidates provide that the value of diversity should be considered in determining director candidates as well as other factors such as a candidate’s character, judgment, skills, education, expertise, and absence of conflicts of interest. Our priority in selection of board members is identification of members who will further the interests of our stockholders through their established records of professional accomplishment, their ability to contribute positively to the collaborative culture among board members, and their knowledge of our business and understanding of the competitive landscape in which we operate and adherence to high ethical standards. Our Nominating and Corporate Governance Committee does not have a formal diversity policy and does not follow any ratio or formula with respect to diversity in order to determine the appropriate composition of our board of directors, although our Nominating and Corporate Governance Committee and our full board of directors are committed to creating a board of directors with diversity, including diversity of expertise, experience, background and gender, and are committed to identifying, recruiting and advancing candidates offering such diversity in future searches. Generally, the Nominating and Corporate Governance Committee identifies candidates for director nominees in consultation with management, through the use of search firms or other advisors, through the recommendations submitted by stockholders or through such other methods as the Nominating and Corporate Governance Committee deems to be helpful to identify candidates. Once candidates have been identified, the Nominating and Corporate Governance Committee confirms that the candidates meet all of the minimum qualifications for director nominees established by the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee may gather information about the candidates through interviews, detailed questionnaires, comprehensive background checks or any other means that the Nominating and Corporate Governance Committee deems to be appropriate in the evaluation process. The Nominating and Corporate Governance Committee then meets as a group to discuss and evaluate the qualities and skills of each candidate, both on an individual basis and taking into account the overall composition and needs of our board of directors. based on the results of the evaluation process, the Nominating and Corporate Governance Committee recommends candidates for the board of directors’ approval to fill a vacancy or as director nominees for election to the board of directors by our stockholders each year in the class of directors whose term expires at the relevant annual meeting. Policy on Trading, Pledging and Hedging of Company Stock Certain transactions in our securities (such as purchases and sales of publicly traded put and call options, and short sales) create a heightened compliance risk or could create the appearance of misalignment between management and stockholders. In addition, securities held in a margin account or pledged as collateral may be sold without consent if the owner fails to meet a margin call or defaults on the loan, thus creating the risk that a sale may occur at a time when an officer or director is aware of material, non-public information or otherwise is not permitted to trade in Company securities. Insider Trading Policies and Procedures We have an insider trading policy governing the purchase, sale and other dispositions of our securities that applies to all of our directors, officers, employees and other covered persons. Our insider trading policy expressly prohibits derivative transactions of our stock by our executive officers, directors and employees. Our insider trading policy expressly prohibits purchases of any derivative securities that provide the economic equivalent of ownership. We believe that our insider trading policy is reasonably designed to promote compliance with insider trading laws, rules and regulations, and listing standards applicable to us. A copy of our insider trading policy is filed as Exhibit 19.1 to this Form 10-K. In addition, with regard to the Company’s trading in its own securities, it is the Company’s policy to comply with the federal securities laws and the applicable exchange listing requirements. Item 11. Executiv e Compensation. 114 Our named executive officers for the year ended December 31, 2024 are: • Chen Schor, MBA, our President and Chief Executive Officer; • Brian Nicholas Harvey (Nick Harvey), MBA, our Chief Financial Officer; • Blake Aftab, Ph.D., our Chief Scientific Officer and Senior Vice President; and • Francesco Galimi, M.D., Ph.D., our former Chief Medical Officer. 2024 Summary Compensation Table The following table sets forth information regarding compensation award to, earned by, or paid to each of our named executive officers for services rendered to us in all capacities during the fiscal year ended December 31, 2024. The following table also presents information regarding compensation awarded to, earned by, and paid to each such individual during the fiscal years ended December 31, 2024 and December 31, 2023, to the extent such individual was a named executive officer for such year. Name and Principal Position Year Salary ($) (1) Stock Awards ($) (2) Option Awards ($) (2) Non-Equity Incentive Plan Compensation ($) (3) All Other Compensation ($) (4) Total ($) Chen Schor, MBA 2024 627,594 168,720 3,587,633 241,780 18,638 (5 ) 4,644,365 President and Chief Executive Officer 2023 606,052 773,775 4,328,064 250,346 15,570 5,973,807 Nick Harvey, MBA 2024 461,694 63,120 849,165 129,360 20,087 (6 ) 1,523,426 Chief Financial Officer 2023 445,538 236,205 1,301,545 133,830 15,570 2,132,688 Blake Aftab, Ph.D. 2024 470,692 47,280 732,479 131,880 91,245 (8 ) 1,473,576 Chief Scientific Officer and Senior Vice President (7) Francesco Galimi, M.D., Ph.D. 2024 485,150 63,120 849,591 - 449,911 (9 ) 1,847,772 Former Chief Medical Officer (7) (1) The amounts reported in the “Salary” column set forth the base salary earned during each fiscal year. (2) In accordance with SEC rules, these columns set forth the aggregate grant date fair value of the stock awards and option awards, as applicable, granted during the applicable fiscal year. For 2023, the amounts also reflect the incremental fair value with respect to the option repricing that took place in August 2023, calculated as of August 14, 2023. The amounts are computed in accordance with the provisions of FASB ASC Topic 718 disregarding the effect of estimated forfeitures related to service-based vesting. These amounts reflect the accounting cost for the equity awards and do not correspond to the actual economic value that may be received by the named executive officer upon exercise of the stock options or vesting or settlement of stock awards. See Note 12 to this Annual Report on Form 10-K regarding certain assumptions underlying the valuation of equity awards. (3) The amounts reported in the “Non-Equity Incentive Plan Compensation” column set forth the amount of compensation earned by the executive officers under the Company’s annual performance-based bonus program during each fiscal year. (4) The amounts reported in the “All Other Compensation” column set forth all of the compensation for each fiscal year that we could not properly report in any other column of the table, including, but not limited to, severance pay as well as the incremental cost to the Company of perquisites and other personal benefits, such as parking reimbursement, relocation assistance, 401(k) match contributions and mobile phone allowances. (5) Amount includes parking reimbursement of $2,393, 401(k) matching contributions of $15,525 and mobile phone allowance of $720. (6) Amount includes parking reimbursement of $3,842, 401(k) matching contributions of $15,525 and mobile phone allowance of $720. (7) Drs. Galimi and Aftab were not named executive officers in fiscal year 2023 and, therefore, their 2023 compensation is not disclosed in this summary compensation table. Additionally, Dr. Galimi resigned from his position as chief medical officer, effective December 13, 2024. (8) Amount includes relocation assistance of $75,000, 401(k) matching contributions of $15,525 and mobile phone allowance of $720. (9) Amount includes severance pay of $433,666 as per the terms of Dr. Galimi's employment agreement and separation agreement and release. See section titled “Employment Arrangements with Our Named Executive Officers” below for additional 115 information on Dr. Galimi's employment agreement and separation agreement and release. Amount also includes 401(k) matching contributions of $15,525 and mobile phone allowance of $720. Narrative to 2024 Summary Compensation Table Our board of directors and Compensation Committee review compensation annually for all employees, including our executives. In setting executive base salaries and bonuses and granting equity incentive awards, we consider compensation for comparable positions in the market, the historical compensation levels of our executives, individual performance as compared to our expectations and objectives, our desire to motivate our employees to achieve short- and long-term results that are in the best interests of our stockholders, and a long-term commitment to our Company. We target a general competitive position, based on independent third-party benchmark analytics to inform the mix of compensation of base salary, bonus or long-term incentives. Our Compensation Committee has historically reviewed and made recommendations to our board of directors regarding the compensation to be paid to our chief executive officer and determined the compensation of our other executive officers. Our Compensation Committee typically reviews and discusses management’s proposed compensation with the chief executive officer for all executives other than the chief executive officer. Based on those discussions and its discretion, taking into account the factors noted above, the Compensation Committee then approves the compensation of our executive officers other than the chief executive officer without members of management present. Our board of directors discusses the Compensation Committee’s recommendations and ultimately approves the compensation of our chief executive officer without members of management present. Aon Consulting, Inc. (Aon Consulting) advised the board of directors and the Compensation Committee on certain compensation matters and decisions during fiscal year 2024. Aon Consulting served at the discretion of the Compensation Committee and did not provide any other services to the Company during fiscal year 2024 other than those for which they were engaged by the Compensation Committee. Our Compensation Committee requires that its compensation consultants be independent of Company management and performs an annual assessment of the compensation consultants’ independence to determine whether the consultants are independent. Our Compensation Committee has determined that Aon Consulting is independent and that its respective work has not raised any conflicts of interest. Annual base salary We use base salaries to recognize the experience, skills, knowledge and responsibilities required of all our employees, including our 2024 named executive officers. Base salaries for our named executive officers are reviewed annually by our Compensation Committee, typically in connection with our annual performance review process, and adjusted from time to time, based on the recommendation of the Compensation Committee, to realign salaries with market levels after taking into account individual responsibilities, performance and experience. None of our 2024 named executive officers are currently party to an employment agreement or other agreement or arrangement that provides for automatic or scheduled increases in base salary. During 2024, the annual base salaries for each of Messrs. Schor, Harvey, Aftab and Galimi, were $628,000, $462,000, $471,000 and $495,000, respectively, which was an increase of approximately 3.5%, 3.6%, 3.5% and 3.6%, respectively, as compared to their 2023 annual base salaries. Dr. Galimi resigned from his position as chief medical officer, effective December 13, 2024, and, therefore, his annual salary reflected his partial year of employment for fiscal year 2024, as reflected in the section titled “2024 Summary Compensation Table” above. Annual bonus Our named executive officers, as well as other executive officers, are eligible to participate in our Cash Incentive Bonus Plan (Bonus Plan) which is an annual bonus program intended to reward our named executive officers for meeting objective or subjective performance goals for a fiscal year. The Bonus Plan provides for cash payments based upon the attainment of performance targets established by the Compensation Committee, which may relate to financial and operational measures or objectives with respect to the Company. Each executive officer who is selected to participate in the Bonus Plan will have a target bonus opportunity set for each performance period. 116 With respect to performance in fiscal year 2024, the target bonus opportunity as a percentage of base salary for each of Messrs. Schor, Harvey, Aftab and Galimi were 55%, 40%, 40%, and 40%, respectively. The 2024 corporate goals used in our 2024 Cash Incentive Bonus Plan were proposed by management, and reviewed and approved by our Compensation Committee and our board of directors in January 2024. Our board of directors considered and assigned a relative weight to each corporate goal to appropriately focus efforts on achievements that were intended to enhance stockholder value. Based on the Company’s achievement of certain performance goals and metrics related to our 2024 corporate objectives, the Compensation Committee determined that the bonuses for executives, including our named executive officers, would be paid at 70% of target and paid in the amounts as set forth above in the Summary Compensation Table. Dr. Galimi resigned from his position as chief medical officer, effective December 13, 2024, and, therefore, he did not receive a cash incentive bonus with respect to fiscal year 2024, as reflected in the section titled “2024 Summary Compensation Table” above. See section titled “Employment Arrangements with Our Named Executive Officers” below for additional information on Dr. Galimi's employment agreement and separation agreement and release. Long-term equity incentives Our equity grant program is intended to align the interests of our named executive officers with those of our stockholders and to motivate them to make important contributions to our performance. In addition, the vesting requirements of our equity awards contribute to executive retention by providing an incentive to our executive officers to remain employed by us during the vesting period. Significant equity awards are granted at the time an executive officer commences employment. Thereafter, equity awards may be granted at varying times and in varying amounts in the discretion of our Compensation Committee or, if awards are being granted to the Chief Executive Officer, in the discretion of our board of directors. None of our executive officers is currently party to an employment agreement that provides for an automatic grant of long-term equity incentives. During the fiscal year ended December 31, 2024, we granted stock options and restricted stock units to each of our named executive officers, as shown in more detail in the “Outstanding Equity Awards at 2024 Fiscal Year End” table below. 401(k) Savings Plan We maintain a 401(k) retirement savings plan for the benefit of our employees, including our named executive officers, who satisfy certain eligibility requirements. Under the 401(k) plan, eligible employees may elect to defer a portion of their compensation, within the limits prescribed by the Code, on a pre-tax or after-tax (Roth) basis, through contributions to the 401(k) plan. The 401(k) plan is intended to qualify under Sections 401(a) and 501(a) of the Code. As a tax-qualified retirement plan, pre-tax contributions to the 401(k) plan and earnings on those pre-tax contributions are not taxable to the employees until distributed from the 401(k) plan, and earnings on Roth contributions are not taxable when distributed from the 401(k) plan. The 401(k) plan authorizes employer discretionary match contributions. We match 100% of the first 3% and 50% of the next 3% of the contributions that eligible participants make to the 401(k) plan up to 6.00% of the participant’s eligible compensation. Health and Welfare Benefits All of our full-time employees, including our executive officers, are eligible to participate in our health and welfare benefits, including medical, dental and vision insurance, medical and dependent care flexible spending accounts, group life and disability insurance, and 401(k) plan. Named executive officers are eligible to participate in all our employee benefit plans, in each case on the same basis as other employees. We do not offer any defined benefit pension plans or nonqualified defined compensation arrangements for our employees, including our named executive officers. Perquisites and Personal Benefits Our policy in 2024 was generally not to provide significant perquisites and personal benefits to our executive officers, including our named executive officers, other than reimbursements for relocation and commuting expenses and certain other de minimis perquisites to our executive officers, including our named executive officers. In 2024, we provided Dr. Aftab relocation assistance of $75,000. 117 Compensation Recovery Policy On November 16, 2023, our board adopted a compensation recovery policy, which became effective on October 2, 2023. The compensation recovery policy provides that in the event we are required to prepare a restatement of financial statements due to material noncompliance with any financial reporting requirement under securities laws, we will seek to recover any incentive-based compensation that was based upon the attainment of a financial reporting measure and that was received by any current or former executive officer during the three-year period preceding the date that the restatement was required if such compensation exceeds the amount that the executive officers would have received based on the restated financial statements. The full text of the compensation recovery policy is included as Exhibit 97.1 to this Annual Report on Form 10-K for the fiscal year ended December 31, 2024. Policy on the Timing of Awards of Options and Other Option-Like Instruments We generally grant annual equity awards, including stock option grants to our named executive officers, in the first quarter of each fiscal year. This grant date timing coincides with our calendar-year-based employee review cycle, allowing managers to deliver the equity awards close in time to performance reviews and feedback. In addition, new hires receive equity grants at the time of their hiring. During 2024, the Compensation Committee did not take into account any material nonpublic information when determining the timing and terms of equity incentive awards, and we did not time the disclosure of material nonpublic information for the purpose of affecting the value of executive compensation. The Compensation Committee met to discuss the size and nature of the equity awards for our named executive officers on December 12, 2023, January 4, 2024 and January 24, 2024. The Compensation Committee discussed the Company’s projected equity usage for fiscal year 2024 and potential dilutive impact of equity awards to our named executive officers, and determined to grant a number of the annual equity awards for the named executive officers effective immediately as of January 24, 2024 with the remaining number of their respective annual awards to be granted contingent upon the approval of the Shareholder Proposal (as defined below). During 2024, consistent with our ordinary course practice of granting equity awards in the first quarter of the fiscal year, we granted stock options to our Named Executive Officers on January 24, 2024 (the “January 24th Awards”), which was the same business day that we filed the Current Report on Form 8-K announcing the closing of our underwritten public offering of 27,054,667 shares of our common stock, and, in lieu of common stock to an investor, pre-funded warrants to purchase 8,445,333 shares of common stock (collectively, the “January 2024 Offering”). The Company originally publicly announced the launch and pricing of the January 2024 Offering on January 22, 2024 via launch and pricing press releases as well as the filing of the preliminary prospectus supplement with the SEC. On January 26, 2024, following finalization of the terms of the Shareholder Proposal, the Compensation Committee approved the grant of the remainder of the annual equity awards, contingent upon the approval of the shareholders of an amendment to the Amended and Restated 2018 Stock Option and Grant Plan (the “Shareholder Proposal”) and with an exercise price equal to the closing price of the Common Stock on the date of the Compensation Committee approval (the “Contingent Awards”). To the extent the Shareholder Proposal was not approved by the shareholders, the Contingent Awards would have been forfeited in their entirety. On June 5, 2024, the Company held its annual meeting of shareholders, where, among other things, the shareholders approved the Shareholder Proposal. Also on June 5, 2024, we furnished a Form 8-K announcing that we had received FDA Fast Track Designation for ADI-001 in Lupus Nephritis and on June 7, 2024, we filed a Current Report on Form 8-K announcing the results of the annual meeting. 118 Name Grant Date (1) Number of securities underlying the award Exercise price of the award ($/Share) (2) Grant Date fair value of the award ($) Percentage change in the closing market price of the securities underlying the award between the trading day ending immediately prior to the disclosure of material nonpublic information and the trading day beginning immediately following the disclosure of material nonpublic information Chen Schor 1/24/2024 1,116,903 2.40 1,941,200 2.9 % (3 ) Nick Harvey 1/24/2024 288,022 2.40 500,588 2.9 % (3 ) Blake Aftab 1/24/2024 241,173 2.40 419,163 2.9 % (3 ) Francesco Galimi 1/24/2024 288,134 2.40 500,783 2.9 % (3 ) Chen Schor 1/24/2024 70,300 — 168,720 2.9 % (3 ) Nick Harvey 1/24/2024 26,300 — 63,120 2.9 % (3 ) Blake Aftab 1/24/2024 19,700 — 47,280 2.9 % (3 ) Francesco Galimi 1/24/2024 26,300 — 63,120 2.9 % (3 ) Chen Schor 1/26/2024 1,770,427 2.53 1,646,434 -2.8 % (4 ) Nick Harvey 1/26/2024 374,829 2.53 348,578 -2.8 % (4 ) Blake Aftab 1/26/2024 336,911 2.53 313,315 -2.8 % (4 ) Francesco Galimi 1/26/2024 375,077 2.53 348,808 -2.8 % (4 ) (1) The awards with a grant date of June 5, 2024 were approved by the compensation committee on January 26, 2024, contingent upon shareholder approval of an amendment to our equity plan, which approval was obtained at the annual meeting on June 5, 2024. Accordingly, such grants have an exercise price equal to the closing price on January 26, 2024, and were not made in contemplation of or in connection with the disclosures made on June 5, 2024 or June 7, 2024 in separate Current Report on Form 8-Ks. (2) Each of the option awards has a ten-year term and vests over four years. The amounts are computed in accordance with the provisions of FASB ASC Topic 718 disregarding the effect of estimated forfeitures related to service-based vesting. These amounts reflect the accounting cost for the equity awards and do not correspond to the actual economic value that may be received by the named executive officer upon exercise of the stock options or vesting or settlement of stock awards. See Note 12 to this Annual Report on Form 10-K regarding certain assumptions underlying the valuation of equity awards. (3) Calculated using the closing price of our common stock on the Nasdaq Global Select Market on January 24, 2024, and January 25, 2024, of $2.40 and $2.47 per share, respectively, given the filing of the Current Report on Form 8-K announcing the closing of the January 2024 Offering on January 24, 2024. As disclosed above, the January 2024 Offering was disclosed to the public on January 22, 2024. Accordingly, on January 22, 2024 and January 23, 2024, the trading days ending immediately prior and beginning immediately following the actual disclosure of the material non-public information to the public via launch and pricing press releases and the filing of a preliminary prospectus, the closing price of our common stock on the Nasdaq Global Select Market was $2.48 and $2.51. (4) Calculated using the closing price of our common stock on the Nasdaq Global Select Market on June 4, 2024, and June 6, 2024, of $1.44 and $1.40 per share, respectively. As disclosed above, the June 5, 2024 awards were approved on January 26, 2024. Accordingly, the percentage change in market value of the closing price on January 26, 2024 (which reflects the exercise price of such grants) compared to the closing price of our common stock on June 6, 2024, represents a change of -44.7%. Employment Arrangements with Our Named Executive Officers Chen Schor In March 2017, we entered into an offer letter with Mr. Schor, as amended in January 2018 and September 2020. Under his amended offer letter, Mr. Schor is entitled to receive an annual base salary, an annual target bonus expressed as a percentage of his annual base salary, reimbursements for reasonable expenses, and is eligible to participate in our employee benefit plans, subject to the terms of such plans. In the event Mr. Schor’s employment is terminated by us without cause or by him for good reason, and such termination occurs outside of a change in control period, Mr. Schor shall be entitled to receive, subject to his execution and non-revocation of a release in favor of the Company (i) an amount equal to twelve (12) months of Mr. Schor’s base salary; (ii) any unpaid bonus earned for the year preceding the date of Mr. Schor’s employment termination, payable at the time it otherwise would have been paid had Mr. Schor’s employment with the Company not terminated; and (iii) a monthly cash payment (including a gross up payment to account for applicable taxes and withholdings) equal to the monthly employer contribution that the 119 Company would have made to provide health insurance to Mr. Schor and covered dependents if the executive had remained employed by the Company until the earliest of (A) the twelve (12) month anniversary of the date of termination; (B) the date that Mr. Schor becomes eligible for group medical plan benefits under any other employer’s group medical plan; or (C) the cessation of the Mr. Schor health continuation rights under COBRA. The amounts payable under (i) and (iii), to the extent taxable, shall be paid out in substantially equal installments in accordance with the Company’s payroll practice over twelve (12) months commencing within 60 days after the date of termination. Mr. Schor’s amended offer letter further provides that, in the event that his employment is terminated by us without cause or by him for good reason, and such termination occurs 3 months prior to or within the 12-month period following a change of control, then in lieu of the payments and benefits described above, Mr. Schor shall be entitled to receive, subject to his execution and non-revocation of a release in favor of the Company, (i) a lump sum cash payment equal to 1.5 times the sum of his then current base salary and target annual incentive compensation for the then-current year (or the target annual incentive compensation in effect immediately prior to the change in control, if higher), (ii) a lump sum cash payment of any unpaid bonus earned for the year preceding the date of Mr. Schor’s employment termination, payable at the time it otherwise would have been paid had Mr. Schor’s employment with the Company not terminated, (iii) a monthly cash payment (including a gross up payment to account for applicable taxes and withholdings) equal to the monthly employer contribution that the Company would have made to provide health insurance to Mr. Schor and covered dependents if Mr. Schor had remained employed by the Company until the earliest of (A) the eighteen (18) month anniversary of the date of termination; (B) the date that Mr. Schor becomes eligible for group medical plan benefits under any other employer’s group medical plan; or (C) the cessation of Mr. Schor’s health continuation rights under COBRA, and (iv) full acceleration of all time-based stock options and other time-based stock-based awards held by Mr. Schor. All references to “cause,” “good reason,” “change in control period” and “change in control” are as defined in his amended offer letter. The payments and benefits provided to Mr. Schor in connection with a change in control may not be eligible for a federal income tax deduction for the company pursuant to Section 280G of the Internal Revenue Code of 1986, as amended, or the Code, and may subject Mr. Schor to an excise tax under Section 4999 of the Code. If the payments or benefits payable to Mr. Schor in connection with a change in control would be subject to the excise tax on golden parachutes imposed under Section 4999 of the Code, then those payments or benefits will be reduced if such reduction would result in a higher net after-tax benefit to Mr. Schor. Nick Harvey In September 2020, we entered into an employment agreement with Mr. Harvey. Under his agreement, Mr. Harvey is entitled to receive an annual base salary, an annual target bonus expressed as a percentage of his base salary, reimbursements for reasonable expenses, and is eligible to participate in our employee benefit plans, subject to the terms of such plans. The company granted Mr. Harvey an inducement grant equal to one percent of the issued and outstanding shares of the company, which fully vests over a period of four years. In the event Mr. Harvey’s employment is terminated by us without cause or by him for good reason, and such termination occurs outside of a change in control period, Mr. Harvey will be eligible to receive, subject to his execution and non-revocation of a release in favor of the Company, (i) an amount equal to nine (9) months of the Mr. Harvey’s base salary; (ii) any unpaid bonus earned for the year preceding the date of Mr. Harvey’s employment termination, payable at the time it otherwise would have been paid had the Mr. Harvey’s employment with the Company not terminated; and (iii) a monthly cash payment (including a gross up payment to account for applicable taxes and withholdings) equal to the monthly employer contribution that the Company would have made to provide health insurance to Mr. Harvey and covered dependents if Mr. Harvey had remained employed by the Company until the earliest of (A) the nine (9) month anniversary of the date of termination; (B) the date that Mr. Harvey becomes eligible for group medical plan benefits under any other employer’s group medical plan; or (C) the cessation of Mr. Harvey’s health continuation rights under COBRA. The amounts payable under (i) and (iii), to the extent taxable, shall be paid out in substantially equal installments in accordance with the Company’s payroll practice over nine (9) months commencing within 60 days after the date of termination. Mr. Harvey’s employment agreement further provides that, in the event that his employment is terminated by us without cause or by him for good reason, and such termination occurs within the 12-month period following a change of control, then in lieu of the payments and benefits described above, Mr. Harvey shall be entitled to receive, subject to his execution and non-revocation of a release in favor of the Company, (i) a lump sum in cash in an amount equal to one (1) times the sum of (A) Mr. Harvey’s then-current base salary (or Mr. Harvey’s base salary in effect immediately prior to the change in control, if higher) plus (B) Mr. Harvey’s target bonus for the then-current year (or Mr. Harvey’s target bonus in effect immediately prior to the change in control, if higher), (ii) any unpaid bonus earned for the year preceding the date of Mr. Harvey’s employment termination, payable at the time it otherwise would have been paid had Mr. Harvey’s employment with the Company not 120 terminated, (iii) 100% acceleration of all time-based equity awards held as of the date of termination and (iv) subject to his election of COBRA health continuation coverage, for up to twelve (12) months or his COBRA health continuation period, whichever ends earlier, a monthly cash payment equal to the monthly employer contribution that the Company would have made to provide health insurance to him if he has remained employed by the Company. All references to “cause”, “good reason”, “change in control period” and “change in control” are as defined in his employment agreement. The payments and benefits provided to Mr. Harvey in connection with a change in control may not be eligible for a federal income tax deduction for the company pursuant to Section 280G of the Internal Revenue Code of 1986, as amended, or the Code, and may subject Mr. Harvey to an excise tax under Section 4999 of the Code. If the payments or benefits payable to Mr. Harvey in connection with a change in control would be subject to the excise tax on golden parachutes imposed under Section 4999 of the Code, then those payments or benefits will be reduced if such reduction would result in a higher net after-tax benefit to Mr. Harvey. Blake Aftab, Ph.D. In April 2021, we entered into an employment agreement with Dr. Aftab, as amended in October 2021. Under his amended agreement, Dr. Aftab is entitled to receive an annual base salary, an annual target bonus expressed as a percentage of his base salary and reimbursements for reasonable expenses, and is eligible to participate in our employee benefit plans, subject to the terms of such plans. Under the amended agreement, the company provided Dr. Aftab with a fully taxable relocation allowance of up to $6,250 per month (for up to four years from his permanent relocation date), less all required deductions and withholdings. In the event Dr. Aftab’s employment is terminated by us without cause or by him for good reason, and such termination occurs outside of a change in control period, Dr. Aftab will be eligible to receive, subject to his execution and non-revocation of a release in favor of the Company, (i) an amount equal to nine (9) months of Dr. Aftab’s base salary; (ii) any unpaid bonus earned for the year preceding the date of Dr. Aftab’s employment termination, payable at the time it otherwise would have been paid had Dr. Aftab’s employment with the Company not terminated; (iii) an amount equal to the lesser of (A) nine (9) months of the monthly relocation allowance or (ii) the number of months of the monthly relocation allowance remaining in the four-year period following his permanent relocation; and (iv) a monthly cash payment (including a gross up payment to account for applicable taxes and withholdings) equal to the monthly employer contribution that the Company would have made to provide health insurance to Dr. Aftab and covered dependents if Dr. Aftab had remained employed by the Company until the earliest of (A) the nine (9) month anniversary of the date of termination; (B) the date that Dr. Aftab becomes eligible for group medical plan benefits under any other employer’s group medical plan; or (C) the cessation of Dr. Aftab’s health continuation rights under COBRA. The amounts payable under (i) and (iv), to the extent taxable, shall be paid out in substantially equal installments in accordance with the Company’s payroll practice over nine (9) months commencing within 60 days after the date of termination. Dr. Aftab’s employment agreement further provides that, in the event that his employment is terminated by us without cause or by him for good reason, and such termination occurs within the 12-month period following a change of control, then in lieu of the payments and benefits described above, Dr. Aftab shall be entitled to receive, subject to his execution and non-revocation of a release in favor of the Company, (i) a lump sum in cash in an amount equal to one (1) times the sum of (A) Dr. Aftab’s then-current base salary (or Dr. Aftab’s base salary in effect immediately prior to the change in control, if higher) plus (B) Dr. Aftab’s target bonus for the then-current year (or Dr. Aftab’s target bonus in effect immediately prior to the change in control, if higher), (ii) any unpaid bonus earned for the year preceding the date of Dr. Aftab’s employment termination, payable at the time it otherwise would have been paid had Dr. Aftab’s employment with the Company not terminated, (iii) an amount equal to the lesser of (A) nine (9) months of the monthly relocation allowance or (ii) the number of months of the monthly relocation allowance remaining in the four-year period following his permanent relocation; (iv) 100% acceleration of all time-based equity awards held as of the date of termination and (v) subject to his election of COBRA health continuation coverage, for up to twelve (12) months or his COBRA health continuation period, whichever ends earlier, a monthly cash payment equal to the monthly employer contribution that the Company would have made to provide health insurance to him if he has remained employed by the Company. All references to “cause,” “good reason,” “change in control period” and “change in control” are as defined in his employment agreement. Francesco Galimi In October 2021, we entered into an employment agreement with Dr. Galimi. Under his employment agreement, Dr. Galimi was entitled to receive an annual base salary, an annual target bonus expressed as a percentage, reimbursements for reasonable expenses, and was eligible to participate in our employee benefit plans, subject to the terms of such plans. The 121 company also provides Dr. Galimi with a fully taxable commuter reimbursement for reasonable travel, less all required deductions and withholdings. In the event Dr. Galimi’s employment was terminated by us without cause or by him for good reason, and such termination occurs outside of a change in control period, Dr. Galimi was eligible to receive, subject to his execution and non-revocation of a separation agreement and release in favor of the Company, (i) an amount equal to nine (9) months of Dr. Galimi’s base salary; (ii) any unpaid bonus earned for the year preceding the date of Dr. Galimi’s employment termination, payable at the time it otherwise would have been paid had Dr. Galimi’s employment with the Company not terminated; and (iii) a monthly cash payment (including a gross up payment to account for applicable taxes and withholdings) equal to the monthly employer contribution that the Company would have made to provide health insurance to Dr. Galini and covered dependents if Dr. Galimi had remained employed by the Company until the earliest of (A) the nine (9) month anniversary of the date of termination; (B) the date that Dr. Galimi becomes eligible for group medical plan benefits under any other employer’s group medical plan; or (C) the cessation of Dr. Galimi’s health continuation rights under COBRA. The amounts payable under (i) and (iii), to the extent taxable, are paid out in substantially equal installments in accordance with the Company’s payroll practice over nine (9) months commencing within 60 days after the date of termination. Dr. Galimi’s employment agreement further provided that, in the event that his employment was terminated by us without cause or by him for good reason, and such termination occurred within the 12-month period following a change in control, then in lieu of the payments and benefits described above, Dr. Galimi would be entitled to receive, subject to his execution and non-revocation of a release in favor of the Company, (i) a lump sum in cash in an amount equal to one (1) times the sum of (A) Dr. Galimi’s then-current base salary (or Dr. Galimi’s base salary in effect immediately prior to the change in control, if higher) plus (B) Dr. Galimi’s target bonus for the then-current year (or Dr. Galimi’s target bonus in effect immediately prior to the change in control, if higher), (ii) any unpaid bonus earned for the year preceding the date of Dr. Galimi’s employment termination, payable at the time it otherwise would have been paid had Dr. Galimi’s employment with the Company not terminated, (iii) 100% acceleration of all time-based equity awards held as of the date of termination and (iv) subject to his election of COBRA health continuation coverage, for up to twelve (12) months or his COBRA health continuation period, whichever ends earlier, a monthly cash payment equal to the monthly employer contribution that the Company would have made to provide health insurance to him if he has remained employed by the Company. All references to “cause,” “good reason,” “change in control period” and “change in control” are as defined in his employment agreement. In December 2024, we entered into a separation agreement and release with Dr. Galimi. Under his separation agreement and release, Mr. Galimi was entitled to receive (i) an amount equal to nine (9) months of Dr. Galimi’s base salary; and (ii) a monthly cash payment (including a gross up payment to account for applicable taxes and withholdings) equal to the monthly employer contribution that the Company would have made to provide health insurance to Dr. Galini and covered dependents if Dr. Galimi had remained employed by the Company until the earliest of (A) the nine (9) month anniversary of the date of termination; (B) the date that Dr. Galimi becomes eligible for group medical plan benefits under any other employer’s group medical plan; or (C) the cessation of Dr. Galimi’s health continuation rights under COBRA. Compensation Risk Assessment We believe that although a portion of the compensation provided to our executive officers and other employees is performance-based, our executive compensation program does not encourage excessive or unnecessary risk taking. Our compensation programs are designed to encourage our executive officers and other employees to remain focused on both short-term and long-term strategic goals, in particular in connection with our pay-for-performance compensation philosophy. As a result, we do not believe that our compensation programs are reasonably likely to have a material adverse effect on us. 122 Outstanding Equity Awards at 2024 Fiscal Year End Table Option Awards (1) Stock Awards Grant Date and Vesting Commencement Date Number of Securities Underlaying Unexercised Options(#) Option Exercise Price($) (2) Expiration Date Number of Shares or Units of Stock that Have Not Vested (#) Market Value of Shares or Units that Have Not Vested ($) (3) Name Exercisable Unexercisable Chen Schor (4) 9/15/2020 36,857 — 2.14 12/5/2029 — — Chen Schor (4) 9/17/2020 872,111 — 2.14 9/17/2030 — — Chen Schor (5) 1/13/2021 235,000 5,000 2.14 1/12/2031 — — Chen Schor (5) 2/12/2021 404,033 17,567 2.14 2/11/2031 — — Chen Schor (5) 1/7/2022 215,104 79,896 2.14 1/6/2032 — — Chen Schor (6) 1/24/2023 — — — — 57,000 54,720 Chen Schor (5) 1/24/2023 184,431 200,469 2.14 1/23/2033 — — Chen Schor (7) 1/24/2024 — — — — 70,300 67,488 Chen Schor (5) 1/24/2024 255,956 860,947 2.40 1/23/2034 — — Chen Schor (5) 1/26/2024 405,722 1,364,705 2.53 1/25/2034 — — Nick Harvey (8) 1/13/2021 88,125 1,875 2.14 1/12/2031 — — Nick Harvey (8) 2/12/2021 27,025 1,175 2.14 2/11/2031 — — Nick Harvey (5) 1/7/2022 91,145 33,855 2.14 1/6/2032 — — Nick Harvey (6) 1/24/2023 — — — — 17,400 16,704 Nick Harvey (5) 1/24/2023 56,158 61,042 2.14 1/23/2033 — — Nick Harvey (4) 8/14/2023 176,308 — 2.14 8/13/2033 — — Nick Harvey (7) 1/24/2024 — — — — 26,300 25,248 Nick Harvey (5) 1/24/2024 66,005 222,017 2.40 1/23/2034 — — Nick Harvey (5) 1/26/2024 85,898 288,931 2.53 1/25/2034 — — Blake Aftab (8) (9) 4/30/2021 45,833 4,167 2.14 4/29/2031 — Blake Aftab (8) 10/12/2021 44,112 12,500 2.14 10/11/2031 — — Blake Aftab (8) 1/7/2022 91,145 33,855 2.14 1/6/2032 — — Blake Aftab (8) (10) 5/10/2022 40,000 20,000 2.14 5/9/2022 — — Blake Aftab (6) 1/24/2023 — — — — 17,400 16,704 Blake Aftab (5) 1/24/2023 56,158 61,042 2.14 1/23/2033 — — Blake Aftab (7) 1/24/2024 — — — — 19,700 18,912 Blake Aftab (5) 1/24/2024 55,268 185,905 2.40 1/23/2034 — — Blake Aftab (5) 1/26/2024 77,208 259,703 2.53 1/25/2034 — — Francesco Galimi (8) 10/15/2019 113,652 — 2.14 3/13/2025 — — Francesco Galimi (5) 9/17/2020 77,269 — 2.14 3/13/2025 — — Francesco Galimi (5) 1/13/2021 72,297 — 2.14 3/13/2025 — — Francesco Galimi (5) 2/12/2021 25,441 — 2.14 3/13/2025 — — Francesco Galimi (5) 1/7/2022 91,145 — 2.14 3/13/2025 — — Francesco Galimi (5) 1/24/2023 53,716 — 2.14 3/13/2025 — — Francesco Galimi (5) 1/24/2024 60,027 — 2.40 3/13/2025 — — Francesco Galimi (5) 1/26/2024 78,141 — 2.53 3/13/2025 — — (1) All equity awards listed in this table were granted pursuant to our 2015 Plan and 2018 Plan. (2) For options granted prior to August 13, 2023, the option exercise prices reflects the effect of the option repricing which took effect on August 14, 2024 and reduced the exercise price of outstanding options under the 2018 and 2015 Plans to $2.14. Options granted after August 14, 2023 have an exercise price equal to the closing stock price on the date of grant. (3) The market value is based on the closing price of our common stock on December 31, 2024, the last trading day of our fiscal year 2024, in the amount of $0.96 per share. (4) Represents fully vested shares of common stock subject to this option. 123 (5) 1/48th of the shares subject to the option vest on each of the next forty-eight (48) monthly anniversaries of the vesting commencement date, provided that the optionee remains in continuous service as of the applicable vesting date. (6) Restricted Stock Units (RSUs) vest in three (3) annual installments, with 1/3 vesting on each of January 24, 2024, January 24, 2025 and January 24, 2026. (7) Restricted Stock Units (RSUs) vest in three (3) annual installments, with 1/3 vesting on each of January 24, 2025, January 24, 2026 and January 24, 2027. (8) 25% of the shares subject to the option vest twelve (12) months after the vesting commencement date, and 1/36th of the remaining unvested shares subject to the option vest on each of the next thirty-six (36) monthly anniversaries of the vesting commencement date thereafter, provided that the optionee remains in continuous service as of the applicable vesting date. (9) The vesting commencement date for this grant is April 5, 2021. (10) The vesting commencement date for this grant is April 29, 2022. Director Compensation The table below shows all compensation earned by or paid to our non-employee directors during 2024. Mr. Schor, our chief executive officer, did not receive any compensation for his services as director in 2024 and, consequently, is not included in this table. The compensation received by Mr. Schor during 2024 is set forth in the section of this Annual Report on Form 10-K captioned “2024 Summary Compensation Table”. Name Fees Earned ($) (1) Stock Awards ($) (2)(3) Option Awards ($) (2)(3) Total ($) Jeffrey Chodakewitz, M.D. 45,000 8,496 27,298 80,794 Steve Dubin 59,000 8,496 27,298 94,794 Carl L. Gordon, Ph.D. 80,000 8,496 27,298 115,794 Aya Jakobovits, Ph.D. 45,000 8,496 27,298 80,794 Michael Kauffman, M.D. Ph.D. (4) 27,978 8,496 27,298 63,772 Lloyd Klickstein, M.D. Ph.D. (5) 16,141 — 79,636 95,777 Katie Peng 47,500 8,496 27,298 83,294 Andrew Sinclair, Ph.D. 55,500 8,496 27,298 91,294 (1) Amounts represent cash compensation for services rendered by each member of the board of directors. (2) Amounts shown reflect the grant date fair value of stock option and restricted stock unit awards granted during 2024. The grant date fair value was computed in accordance with FASB ASC Topic 718 disregarding the effect of estimated forfeitures related to service-based vesting. These amounts reflect the accounting cost for the stock options and RSU awards and do not correspond to the actual economic value that may be received by the director upon exercise of the stock options. See Note 12 to this Annual Report on Form 10-K regarding certain assumptions underlying the valuation of equity awards. (3) The following table shows the number of outstanding stock options and restricted stock units held by our directors as of December 31, 2024: Name Number of Shares Underlying Outstanding Stock Options Number of Shares Underlying Unvested Restricted Stock Units Jeffrey Chodakewitz, M.D. 119,800 5,900 Steve Dubin 119,800 5,900 Carl L. Gordon, Ph.D. 119,800 5,900 Aya Jakobovits, Ph.D. 119,800 5,900 Michael Kauffman, M.D. Ph.D. — — Lloyd Klickstein, M.D. Ph.D. 150,200 — Katie Peng 96,600 5,900 Andrew Sinclair, Ph.D. 126,800 5,900 (4) Dr. Kauffman resigned from our board of directors, effective August 19, 2024. His cash fees earned represent a pro-rated amount from January 1, 2024 through August 19, 2024, the date he ceased being a member of our board of directors. 124 (5) Dr. Klickstein was appointed to the board, effective August 19, 2024. Dr. Klickstein received an initial stock option grant to purchase 70,200 shares of the Company’s common stock. In addition, Dr. Klickstein replaced Dr. Kauffman as a member of the nominating and corporate governance committee, effective August 19, 2024. His cash fees earned represent a pro-rated amount from August 19, 2024 through December 31, 2024. Under our director compensation program, we pay our non-employee directors a cash retainer for service on the board of directors and for service on each committee on which the director is a member. The chairman of each committee receives a higher retainer for such service. These fees are payable in arrears in four equal quarterly installments on the last day of each quarter, provided that the amount of such payment is prorated for any portion of such quarter that the director is not serving on our board of directors. The fees paid to non-employee directors for service on the board of directors and for service on each committee of the board of directors on which the director is a member are as follows: Member Annual Fee Chairperson Additional Annual Fee Board of Directors $ 40,000 $ 30,000 Audit Committee 7,500 15,000 Compensation Committee 5,000 10,000 Nominating and Corporate Governance Committee 4,000 8,000 We also reimburse our non-employee directors for reasonable travel and out-of-pocket expenses incurred by our non-employee directors in connection with attending our meetings of the board of directors and committees thereof. In addition, effective as of January 24, 2023, each new non-employee director elected to our board of directors will be granted an initial, one-time award of a stock option to purchase 70,200 shares, which shall vest in thirty-six (36) equal monthly installments over a three-year period from the date of grant, subject to continued service as a director through each such vesting date. Additionally, on the date of each annual meeting of stockholders of our company, each continuing non-employee director will receive an annual equity award of 26,400 options and 5,900 restricted stock units which shall vest in full upon the earlier to occur of the first anniversary of the date of grant or the date of the next annual meeting of stockholders; provided, however, that all vesting shall cease if the director resigns from the board of directors or otherwise ceases to serve as a director, unless the board of directors determines that the circumstances warrant continuation of vesting. This non-employee director compensation program is intended to provide a total compensation package that enables us to attract and retain qualified and experienced individuals to serve as directors and to align our directors’ interests with those of our stockholders. Item 12. Security Ownership of Certain Beneficial Ow ners and Management and Related Stockholder Matters. Equity Compensation Plan Information The following table provides information as of December 31, 2024 with respect to the shares of our common stock that may be issued under our existing equity compensation plans. Plan Category Number of Securities To Be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted Average Exercise Price of Outstanding Options, Warrants and Rights Number of Securities Remaining Available for Future Issuance under Equity Compensation Plans (Excluding Securities in First Column) Equity compensation plans approved by security holders (1)(2)(3)(4) 14,126,176 (5) $ 2.68 3,796,336 Equity compensation plans not approved by security holders 1,558,750 (6) $ 6.63 441,250 Total 15,684,926 $ 3.09 4,237,586 (1) Includes the following plans: our 2014 Share Option Plan (2014 Plan), 2015 Plan, the 2017 Plan, the 2018 Plan, and 2018 Employee Stock Purchase Plan (2018 ESPP). (2) As of December 31, 2024, a total of 15,857,403 shares of our common stock are authorized for issuance pursuant to the Amended 2018 Plan, which number excludes the 4,542,314 shares that were added to the Amended 2018 Plan as a result of the automatic annual increase of 5% on January 1, 2025. 125 (3) As of December 31, 2024, a total of 1,155,556 shares of our common stock are authorized for issuance pursuant to the 2018 ESPP, which number excludes the 824,009 shares that were added to the 2018 ESPP as a result of the automatic annual increase of 1% on January 1, 2025. (4) As of December 31, 2024, an aggregate of 870,302 shares of common stock were issuable upon the exercise of outstanding stock options under the 2015 Plan at a weighted average exercise price of $2.14 per share and an aggregate of 18,987 shares of common stock were issuable upon the exercise of outstanding stock options under the 2014 Plan at a weighted average exercise price of $1.61 per share. Pursuant to the Amended 2018 Plan, any shares of Common Stock subject to outstanding grants under the 2015 Plan that terminate, expire or are canceled, forfeited, exchanged or surrendered without having been exercised, vested or paid under the 2015 Plan after the Effective Date of the Amended 2018 Plan shall be available for issuance under the Amended 2018 Plan (such shares, the “Rollover Shares”). As of December 31, 2024, a total of 20,264 shares of our common stock were available for issuance under the 2018 Plan as Rollover Shares from the 2015 Plan. Since the date of effectiveness of the Merger, the Company has not and will not grant any further awards under the 2014 Plan. Additionally, since the date of the 2023 Shareholder meeting, the Company has not and will not grant any further awards under the 2015 Plan. (5) Includes: (i) an aggregate of 12,517,231 shares of common stock issuable upon the exercise of outstanding stock options under the Amended 2018 Plan; (ii) 719,656 shares of common stock issuable upon the vesting of RSUs under the Amended 2018 Plan; (iii) 870,302 shares of common stock issuable upon the exercise of outstanding stock options under the 2015 Plan; and (iv) 18,987 shares of common stock issuable upon the exercise of outstanding stock options under the 2014 Plan. (6) Represents option awards granted to individuals as an inducement material to the individual’s entry into employment with us. Each such grant was approved by our Compensation Committee. Under applicable Nasdaq listing rules, inducement grants are not subject to stockholder approval. In January 2022, our board of directors approved the 2022 Inducement Plan (Inducement Plan) and authorized 1,000,000 shares for issuance under the Inducement Plan. In January 2023, our board of directors amended the Inducement Plan to increase the authorized shares to 2,000,000. In January 2025, our board of directors amended the Inducement Plan to increase the authorized shares to 2,750,000. 126 Security Ownership of Certain Beneficial Owners and Management The following table sets forth information, to the extent known by us or ascertainable from public filings, with respect to the beneficial ownership of our common stock as of March 3, 2025 by: 1. each of our directors; 2. each of our named executive officers; 3. all of our directors and executive officers as a group; and 4. each person, or group of affiliated persons, who is known by us to beneficially own greater-than-5.0% of our common stock. The column entitled “Shares of Common Stock Beneficially Owned” is based on a total of 82,661,803 shares of our common stock outstanding as of March 3, 2025. Beneficial ownership is determined in accordance with the rules and regulations of the SEC and includes voting or investment power with respect to our common stock. Shares of our common stock subject to stock options that are currently exercisable or exercisable within 60 days of March 3, 2025, and any RSUs that vest within 60 days of March 3, 2025, are considered outstanding and beneficially owned by the person holding the stock options and RSUs for the purpose of calculating the percentage ownership of that person but not for the purpose of calculating the percentage ownership of any other person. Except as otherwise noted, the persons and entities in this table have sole voting and investing power with respect to all of the shares of our common stock beneficially owned by them, subject to community property laws, where applicable. Unless otherwise indicated, the address for each beneficial owner is c/o Adicet Bio, Inc., 131 Dartmouth Street, 3rd Floor, Boston, Massachusetts 02116. Name of Beneficial Owner Shares of Common Stock Beneficially Owned Percentage of Shares Greater than 5% Stockholders Entities affiliated with OrbiMed (1) 11,546,440 14.0 % RA Capital Healthcare Fund, L.P. (2) 8,308,532 10.0 % Tang Capital Partners, LP (3) 8,145,988 9.9 % Named Executive Officers and Directors Chen Schor (4) 3,135,518 3.7 % Nick Harvey (5) 754,202 * Blake Aftab Ph.D. (6) 543,844 * Jeffrey Chodakewitz, M.D. (7) 99,300 * Steve Dubin (8) 104,300 * Carl L. Gordon, Ph.D. (1) 11,546,440 14.0 % Aya Jakobovits, Ph.D. (9) 950,062 1.1 % Lloyd Klickstein, M.D., Ph.D. (10) 198,266 * Katie Peng (11) 46,850 * Andrew Sinclair, Ph.D. (12) 106,300 * All Current Executive Officers and Directors as a Group (12 persons) (13) 18,113,044 20.6 % * Represents beneficial ownership of less than one percent. (1) Based solely on a Schedule 13D/A filed with the SEC on March 21, 2024 by OrbiMed Advisors LLC, OrbiMed Advisors Israel II Limited, OrbiMed Israel GP II, L.P., OrbiMed Israel GP Ltd., OrbiMed Israel BioFund GP Limited Partnership, OrbiMed Capital GP V LLC, OrbiMed Capital GP VI LLC, OrbiMed Genesis GP LLC, Carl L. Gordon and Erez Chimovits. Consists of (i) 99,300 shares of common stock issuable upon exercise of options held by Dr. Gordon exercisable within 60 days of March 3, 2025, (ii) 5,900 shares of common stock held by Dr. Gordon, (iii) 1,255,985 shares of common stock held by OrbiMed Genesis Master Fund, L.P. (Genesis), (iv) 1,027,885 shares of common stock held by OrbiMed Israel Partners Limited Partnership (OIP), (v) 646,657 shares of common stock held by OrbiMed Israel Partners II, L.P. (OIP II), (vi) 7,526,359 shares of common stock held by OrbiMed Private Investments V, LP (OPI V), and (vii) 990,254 shares of common stock held by OrbiMed Private 127 Investments VI, LP (OPI VI). OrbiMed Genesis GP LLC (Genesis GP) is the general partner of Genesis and OrbiMed Advisors LLC (OrbiMed Advisors) is the managing member of Genesis GP. By virtue of such relationships, Genesis GP and OrbiMed Advisors may be deemed to have voting power and investment power over the securities held by Genesis and as a result, may be deemed to have beneficial ownership over such securities. OrbiMed Israel BioFund GP Limited Partnership (BioFund GP) is the general partner of OIP and OrbiMed Israel GP Ltd. (Israel GP) is the general partner of BioFund GP. By virtue of such relationships, BioFund GP and Israel GP may be deemed to have voting power and investment power over the securities held by OIP and as a result, may be deemed to have beneficial ownership over such securities. Israel GP exercises its investment and voting power through a management committee comprised of Dr. Gordon and Mr. Chimovits, each of whom disclaims beneficial ownership of the shares of common stock held by OIP. OrbiMed Israel GP II, L.P. (Israel GP II) is the general partner of OIP II and OrbiMed Advisors Israel II Limited (Advisors Israel) is the general partner of Israel GP II. By virtue of such relationships, Israel GP II and Advisors Israel may be deemed to have voting power and investment power over the securities held by OIP II and as a result, may be deemed to have beneficial ownership over such securities. Advisors Israel exercises its investment and voting power through a management committee comprised of Dr. Gordon, David P. Bonita, and Mr. Chimovits, each of whom disclaims beneficial ownership of the shares held by OIP II. OrbiMed Capital GP V LLC (GP V) is the general partner of OPI V and OrbiMed Advisors is the managing member of GP V. By virtue of such relationships, GP V and OrbiMed Advisors may be deemed to have voting power and investment power over the securities held by OPI V and as a result, may be deemed to have beneficial ownership over such securities. OrbiMed Capital GP VI LLC (GP VI) is the general partner of OPI VI and OrbiMed Advisors is the managing member of GP VI. By virtue of such relationships, GP VI and OrbiMed Advisors may be deemed to have voting power and investment power over the securities held by OPI VI and as a result, may be deemed to have beneficial ownership over such securities. OrbiMed Advisors exercises its investment and voting power through a management committee comprised of Dr. Gordon, Sven H. Borho, and W. Carter Neild, each of whom disclaims beneficial ownership of the shares of common stock held by Genesis, OPI V, and OPI VI. Dr. Gordon, a member of OrbiMed Advisors, is a member of our board of directors. OrbiMed Advisors has its principal offices at 601 Lexington Avenue, 54 th Floor, New York, New York 10022. Israel GP and Advisors Israel II have their principal offices at 5 Hahoshlim Street, Building B, 1 st Floor, Herzliya Pituach, Israel. (2) Based solely on a Schedule 13G/A filed with the SEC on November 14, 2024 by RA Capital Management, L.P. (RA Capital). Consists of (i) 7,541,000 shares of common stock held by RA Capital Healthcare Fund, L.P. (the Fund), (ii) 767,532 shares of common stock that the Fund beneficially owns based on the right to acquire upon exercise of pre-funded warrants, subject to the beneficial ownership blocker of the pre-funded warrants. The beneficial ownership blocker of the pre-funded warrants precludes the exercise of the pre-funded warrants to the extent that, following exercise, the Fund, together with its affiliates, would beneficially own more than 9.99% of the shares of common stock outstanding immediately after giving effect to the exercise. Does not include pre-funded warrants to purchase an additional 7,677,801 shares of common stock held by the Fund, which are not deemed beneficially owned by the Fund due to the beneficial ownership blocker. RA Capital Healthcare Fund GP, LLC is the general partner of the Fund. The general partner of RA Capital is RA Capital Management GP, LLC, of which Dr. Peter Kolchinsky and Mr. Rajeev Shah are the controlling persons. RA Capital serves as investment adviser for the Fund and may be deemed a beneficial owner of any securities of the Company held by the Fund. The Fund has delegated to RA Capital the sole power to vote and the sole power to dispose of all securities held in the Fund’s portfolio, including the ordinary shares held by the Fund. Because the Fund has divested itself of voting and investment power over the reported securities it holds and may not revoke that delegation on less than 61 days’ notice, the Fund disclaims beneficial ownership of the securities it holds for purposes of Section 13(d) of the Exchange Act. As managers of RA Capital, Dr. Kolchinsky and Mr. Shah may be deemed beneficial owners, for purposes of Section 13(d) of the Exchange Act, of any securities of the Company beneficially owned by RA Capital. RA Capital, Dr. Kolchinsky, and Mr. Shah disclaim beneficial ownership of securities reported herein. The address for RA Capital is 200 Berkeley Street, 18th Floor, Boston, MA 02116. (3) Based solely on Schedule 13F filed with the SEC on February 14, 2025 by Tang Capital Partners, LP (Tang Capital), Tang Capital Management, LLC (Tang Capital Management), and Kevin Tang. Tang Capital Management is the general partner of Tang Capital and Kevin Tang is the manager of Tang Capital Management. All parties share voting and dispositive power over the shares of common stock reported. The principal address of Tang Capital, Tang Capital Management and Kevin Tang is 4747 Executive Drive, Suite 210, San Diego, CA 92121. (4) Consists of (i) 61,835 shares of common stock held directly by Mr. Schor, (ii) 53,424 shares of common stock held directly by The C. Schor IRRV Trust, an irrevocable family trust having an independent trustee, (iii) 43,469 shares of common stock held directly by The I. Schor IRRV Trust, an irrevocable family trust having an independent 128 trustee and (iv) 2,976,790 shares of common stock issuable upon the exercise of options held by Mr. Schor exercisable within 60 days of March 3, 2025. (5) Consists of (i) 64,815 shares of common stock held by Mr. Harvey, and (ii) 689,387 shares of common stock issuable upon the exercise of options held by Mr. Harvey exercisable within 60 days of March 3, 2025. (6) Consists of (i) 34,408 shares of common stock held by Dr. Aftab, and (ii) 509,436 shares of common stock issuable upon the exercise of options held by Dr. Aftab exercisable within 60 days of March 3, 2025. (7) Consists of (i) 5,900 shares of common stock held by Dr. Chodakewitz and (ii) 93,400 shares of common stock issuable upon the exercise of options held by Dr. Chodakewitz exercisable within 60 days of March 3, 2025. (8) Consists of (i) 5,000 shares of common stock held by a revocable trust of which Mr. Dubin and his spouse are co-trustees, (ii) 5,900 shares of common stock held by Mr. Dubin and (iii) 93,400 shares of common stock issuable upon the exercise of options held by Mr. Dubin exercisable within 60 days of March 3, 2025. (9) Consists of (i) 356,343 shares of common stock held directly by an irrevocable family trust of which Dr. Jakobovits' spouse is the trustee and Dr. Jakobovits' daughter is the beneficiary, (ii) 356,343 shares of common stock held directly by an irrevocable family trust of which Dr. Jakobovits' spouse is the trustee and Dr. Jakobovits' son is the beneficiary, (iii) 138,076 shares of common stock held by a revocable trust of which Dr. Jakobovits and her spouse are co-trustees, (iv) 5,900 shares of common stock held by Dr. Jakobovits and (v) 93,400 shares of common stock issuable upon the exercise of options held by Dr. Jakobovits exercisable within 60 days of March 3, 2025. (10) Consists of (i) 102,666 shares of common stock held by Dr. Klickstein and (ii) 95,600 shares of common stock issuable upon the exercise of options held by Dr. Klickstein exercisable within 60 days of March 3, 2025. (11) Consists of (i) 5,900 shares of common stock held by Dr. Peng and (ii) 40,950 shares of common stock issuable upon the exercise of options held by Ms. Peng exercisable within 60 days of March 3, 2025. (12) Consists of (i) 5,900 shares of common stock held by Dr. Sinclair and (ii) 100,400 shares of common stock issuable upon the exercise of options held by Dr. Sinclair exercisable within 60 days of March 3, 2025. (13) Includes (i) the shares of common stock described in note (1), (4), (5) and (6) through (13) above, (ii) 41,936 shares of common stock held by other executive officers Donald Healey, Ph.D., our Chief Technology Officer and Julia Maltzman, M.D., our Chief Medical Officer, (iii) 568,026 shares of common stock issuable upon exercise of options held by Dr. Healey and Dr. Maltzman exercisable within 60 days of March 3, 2025. Item 13. Certain Relationships and Related Transactions, and Director Independence. Certain Relationships and Transactions Other than the compensation agreements and other arrangements described under “Executive Compensation” and “Director Compensation” above, since January 1, 2023, there has not been and there is not currently proposed, any transaction or series of similar transactions to which we were, or will be, a party in which the amount involved exceeded, or will exceed, $120,000 (or, if less, 1% of the average of our total assets amounts at December 31, 2024 and 2023) and in which any director, executive officer, holder of five percent or more of any class of our capital stock or any member of the immediate family of, or entities affiliated with, any of the foregoing persons, had, or will have, a direct or indirect material interest. Underwritten Public Offering In January 2024, we entered into an underwriting agreement (the Underwriting Agreement) with Jefferies LLC and Guggenheim Securities, LLC, as representatives of the underwriters (the Underwriters), related to an underwritten public offering (the Offering) of 32,379,667 shares of our common stock, which included 5,325,000 shares sold and issued upon the exercise in full by the Underwriters of their option to purchase additional shares of common stock, and, in lieu of common stock to certain investors, pre-funded warrants to purchase 8,445,333 shares of common stock. The shares of common stock were sold at a public offering price of $2.40 per share and the pre-funded warrants were sold at a public offering price of $2.3999 per pre-funded warrant, which represents the per share public offering price of each share of common stock minus the $0.0001 per share exercise price for each pre-funded warrant. We received net proceeds from the Offering, after deducting the underwriting discount and commissions and other estimated offering expenses, of approximately $91.8 million. We may receive nominal proceeds, if any, from the exercise of the pre-funded warrants. Certain of our investors, including entities affiliated with OrbiMed purchased shares from the Underwriters in connection with the Offering. 129 The following table summarizes the purchases on January 24, 2024 of our common stock by our directors and 5% stockholders at such date: Name of Purchaser Shares Purchased Aggregate Purchase Price OrbiMed Private Investments V, LP (1) 1,841,100 $4,418,640 OrbiMed Private Investments VI, LP (1) 242,200 $581,280 OrbiMed Genesis Master Fund, L.P. (1) 1,041,700 $2,500,080 Abingworth Bioventures VI LP (2) 833,333 $1,999,999 (1) As detailed in the section above titled “Principal Stockholders,” entities affiliated with OrbiMed Advisors LLC (OrbiMed Advisors), including OrbiMed Private Investments V, LP, OrbiMed Private Investments VI, LP and OrbiMed Genesis Master Fund, L.P., hold greater than 5% of our outstanding common stock. Dr. Gordon, a member of our Board of Directors, is a founding member, Managing Partner, and Co-Head of Global Private Equity at OrbiMed Advisors. (2) Abingworth Bioventures VI LP has delegated to Abingworth LLP all investment and dispositive power over the securities held of record by Abingworth Bioventures VI LP. Immediately prior to the Offering, entities affiliated with Abingworth LLP held greater than 5% of our outstanding common stock. Dr. Sinclair, a member of our Board of Directors, is a partner at Abingworth LLP. Limitation of Liability and Indemnification of Officers and Directors Our certificate of incorporation contains provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as directors, except liability for the following: • any breach of their duty of loyalty to our company or our stockholders; • any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; • unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law (DGCL); or • any transaction from which they derived an improper personal benefit. Any amendment to, or repeal of, these provisions will not eliminate or reduce the effect of these provisions in respect of any act, omission or claim that occurred or arose prior to that amendment or repeal. If the Delaware General Corporation Law is amended to provide for further limitations on the personal liability of directors of corporations, then the personal liability of our directors will be further limited to the greatest extent permitted by the Delaware General Corporation Law. As further detailed in Proposal No. 4 above, we are also asking our shareholders to amend our Third Amended and Restated Certificate of Incorporation to limit liability for certain of our officers. Specifically, amended DGCL Section 102(b)(7) only permits exculpation for direct claims brought by stockholders for breach of an officer’s fiduciary duty of care, including class actions, but does not eliminate officers’ monetary liability for breach of fiduciary duty claims brought by the corporation itself or for derivative claims brought by stockholders in the name of the corporation. Furthermore, the limitation on liability does not apply to breaches of the duty of loyalty, acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, or any transaction in which the officer derived an improper personal benefit. In addition, we adopted bylaws which provide that we will indemnify, to the fullest extent permitted by law, any person who is or was a party or is threatened to be made a party to any action, suit or proceeding by reason of the fact that he or she is or was one of our directors or officers or is or was serving at our request as a director or officer of another corporation, partnership, joint venture, trust, or other enterprise. Our bylaws provide that we may indemnify to the fullest extent permitted by law any person who is or was a party or is threatened to be made a party to any action, suit, or proceeding by reason of the fact that he or she is or was one of our employees or agents or is or was serving at our request as an employee or agent of another corporation, partnership, joint venture, trust or other enterprise. Our bylaws also provide that we must advance expenses incurred by or on behalf of a director or officer in advance of the final disposition of any action or proceeding, subject to very limited exceptions. 130 We have entered into and, in the future, plan to enter into agreements to indemnify our directors and executive officers. These agreements, among other things, require us to indemnify these individuals for certain expenses (including attorneys’ fees), judgments, fines and settlement amounts reasonably incurred by such person in any action or proceeding, including any action by or in our right, on account of any services undertaken by such person on behalf of our company or that person’s status as a member of our board of directors to the maximum extent allowed under Delaware law. Related Person Transaction Policy Our board of directors adopted a written related person transactions policy providing that transactions with our directors, officers and holders of five percent or more of our voting securities and their affiliates, each a related person, must be approved by our Audit Committee. This policy became effective on January 25, 2018, the date our registration statement for our initial public offering became effective, and was amended on December 19, 2022. Pursuant to this policy, the Audit Committee has the primary responsibility for reviewing and approving or disapproving “related person transactions,” which are transactions between us and related persons in which a related person has or will have a direct or indirect material interest. For purposes of this policy, a related person is defined as a director, executive officer, nominee for director, or greater than 5% beneficial owner of our common stock, in each case since the beginning of the most recently completed year, and their immediate family members. As appropriate for the circumstances, the Audit Committee will review and consider: 1. the related person’s interest in the related person transaction; 2. whether the transaction was undertaken in the ordinary course of our business; and 3. whether the terms of the transaction are no less favorable to us than terms that could have been reached with an unrelated third party. Director Independence Applicable Nasdaq Stock Market LLC (Nasdaq) rules require a majority of a listed company’s board of directors to be comprised of independent directors within one year of listing. In addition, the Nasdaq rules require that, subject to specified exceptions, each member of a listed company’s audit, compensation and nominating and corporate governance committees be independent and that audit committee members also satisfy independence criteria set forth in Rule 10A-3 under the Exchange Act and that compensation committee members satisfy independence criteria set forth in Rule 10C-1 under the Exchange Act. Under applicable Nasdaq rules, a director will only qualify as an “independent director” if, in the opinion of the listed company’s board of directors, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In order to be considered independent for purposes of Rule 10A-3, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the board of directors, or any other board committee, accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries or otherwise be an affiliated person of the listed company or any of its subsidiaries. In addition, in affirmatively determining the independence of any director who will serve on a company’s compensation committee, Rule 10C-1 under the Exchange Act requires that a company’s board of directors must consider all factors specifically relevant to determining whether a director has a relationship to such company which is material to that director’s ability to be independent from management in connection with the duties of a compensation committee member, including: the source of compensation to the director, including any consulting, advisory or other compensatory fee paid by such company to the director, and whether the director is affiliated with the company or any of its subsidiaries or affiliates. Our board of directors has determined that all members of the board of directors, except Mr. Schor, are independent directors, including for purposes of the rules of Nasdaq and the SEC. In making such independence determination, our board of directors considered the relationships that each non-employee director has with us and all other facts and circumstances that our board of directors deemed relevant in determining their independence, including the beneficial ownership of our capital stock by each non-employee director. In considering the independence of the directors listed above, our board of directors considered the association of our directors with the holders of more than 5% of our common stock. There are no family relationships among any of our directors or executive officers. Mr. Schor is not an independent director under these rules because he is an executive officer of the Company. Item 14. Principal Accoun tant Fees and Services. 131 Our independent public accounting firm is KPMG LLP, Boston, Massachusetts (PCAOB Auditor ID: 185 ). The following table sets forth all fees paid or accrued by us for professional audit services and other services rendered by KPMG LLP during the years ended December 31, 2024 and December 31, 2023. Fee Category Fiscal Year 2024 Fiscal Year 2023 Audit Fees (1) $ 592,800 $ 796,500 Audit-Related Fees — — Tax Fees (2) — — All Other Fees (3) — — Total Fees $ 592,800 $ 796,500 (1) Audit fees consist of fees for professional services provided by KPMG LLP for the audit of our annual financial statements, the review of interim consolidated financial statements included in our quarterly reports on Form 10-Q and consultations on accounting matters directly related to the audit. Audit fees also consist of fees related to registration statements, comfort letters and consents and fees related to statutory audits of our subsidiary. (2) There were no tax fees in fiscal years 2024 and 2023. (3) There were no other fees for fiscal years 2024 and 2023. Audit Committee Pre-approval Policy and Procedures Our Audit Committee has adopted policies and procedures relating to the approval of all audit and non-audit services that are to be performed by our independent registered public accounting firm. This policy provides that we will not engage our independent registered public accounting firm to render audit or non-audit services unless the service is specifically approved in advance by our Audit Committee or the engagement is entered into pursuant to the pre-approval procedure described below. From time to time, our Audit Committee may pre-approve specified types of services that are expected to be provided to us by our independent registered public accounting firm during the next 12 months. Any such pre-approval details the particular service or type of services to be provided and is also generally subject to a maximum dollar amount. During our 2024 and 2023 fiscal years, no services were provided to us by KPMG, as applicable, other than in accordance with the pre-approval policies and procedures described above. 132 PART IV Item 15. Exhibits and Finan cial Statement Schedules. (a) The following documents are included in this Annual Report on Form 10-K: (1) The following Report and Consolidated Financial Statements of the Company are included in this Annual Report: • Report of Independent Registered Public Accounting Firm • Consolidated Balance Sheets • Consolidated Statements of Operations and Comprehensive Loss • Consolidated Statements of Stockholders’ Equity • Consolidated Statements of Cash Flows • Notes to Consolidated Financial Statements (2) Financial Statement Schedules: • All financial statement schedules have been omitted because they are not applicable, not required or the information required is shown in the financial statements or the notes thereto. (3) Exhibits. The exhibits filed as part of this Annual Report on Form 10-K are set forth on the Exhibit Index immediately preceding the signature page of this Annual Report on Form 10-K. The Exhibit Index is incorporated herein by reference. 133 ADICET BIO, INC. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm (KPMG LLP, Boston, MA, Auditor Firm ID: 185) F- 2 Consolidated Financial Statements Consolidated Balance Sheets as of December 31, 2024 and 2023 F- 3 Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2024 and 2023 F- 4 Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2024 and 2023 F- 5 Consolidated Statements of Cash Flows for the years ended December 31, 2024 and 2023 F- 6 Notes to Consolidated Financial Statements F- 7 F- 1 Report of Independent Registered Public Accounting Firm To the Stockholders and Board of Directors Adicet Bio, Inc.: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Adicet Bio, Inc. and subsidiaries (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for the years then ended, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended, in conformity with U.S. generally accepted accounting principles. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters Critical audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters. /s/ KPMG LLP We have served as the Company’s auditor since 2020. Boston, Massachusetts March 6, 2025 F- 2 Adicet Bio, Inc. Consolidated B alance Sheets (in thousands, except share and per share amounts) December 31, 2024 December 31, 2023 Assets Current assets: Cash and cash equivalents $ 56,495 $ 159,711 Short-term investments in treasury securities 119,808 — Prepaid expenses and other current assets 3,833 2,561 Total current assets 180,136 162,272 Restricted cash 2,903 — Property and equipment, net 22,524 26,777 Operating lease right-of-use asset 14,228 17,424 Other non-current assets 428 822 Total assets $ 220,219 $ 207,295 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable $ 4,830 $ 2,625 Accrued and other current liabilities 11,430 13,441 Operating lease liability 3,132 3,221 Total current liabilities 19,392 19,287 Operating lease liability, net of current portion 14,102 17,703 Other non-current liabilities 116 130 Total liabilities 33,610 37,120 Commitments and contingencies (Note 10) Stockholders’ equity: Preferred stock, $ 0.0001 par value, 10,000,000 shares authorized as of December 31, 2024 and December 31, 2023, respectively; none issued and outstanding as of December 31, 2024 and December 31, 2023, respectively — — Common stock, $ 0.0001 par value, 300,000,000 and 150,000,000 shares authorized as of December 31, 2024 and December 31, 2023, respectively; 82,569,168 and 43,270,386 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively 8 4 Additional paid-in capital 684,479 550,943 Accumulated deficit ( 497,894 ) ( 380,772 ) Accumulated other comprehensive income 16 — Total stockholders’ equity 186,609 170,175 Total liabilities and stockholders’ equity $ 220,219 $ 207,295 The accompanying notes are an integral part of these consolidated financial statements. F- 3 Adicet Bio, Inc. Consolidated Statements of Ope rations and Comprehensive Loss (in thousands, except share and per share amounts) Years Ended December 31, 2024 2023 Operating expenses: Research and development $ 99,323 $ 106,043 General and administrative 28,292 26,533 Goodwill impairment — 19,462 Total operating expenses 127,615 152,038 Loss from operations ( 127,615 ) ( 152,038 ) Interest income 10,714 9,978 Interest expense ( 4 ) ( 25 ) Other expense, net ( 217 ) ( 573 ) Loss before income tax provision ( 117,122 ) ( 142,658 ) Income tax provision — — Net loss $ ( 117,122 ) $ ( 142,658 ) Net loss per share, basic and diluted $ ( 1.33 ) $ ( 3.31 ) Weighted-average common shares used in computing net loss per share, basic and diluted 87,866,435 43,042,405 Other comprehensive income Unrealized gain on treasury securities, net of tax 16 — Total other comprehensive income 16 — Comprehensive loss $ ( 117,106 ) $ ( 142,658 ) The accompanying notes are an integral part of these consolidated financial statements. F- 4 Adicet Bio, Inc. Consolidated Statements of Stockholders’ Equity (in thousands, except share amounts) Common Stock Additional Paid In Accumulated Accumulated Other Comprehensive Total Stockholders' Shares Amount Capital Deficit Income Equity Balance at December 31, 2022 42,954,820 $ 4 $ 530,448 $ ( 238,114 ) $ — $ 292,338 Issuance of common stock upon exercise of stock options 946 — 4 — — 4 Issuance of common stock upon vesting of restricted stock 194,455 — — — — — Shares withheld for taxes ( 86,145 ) — ( 150 ) — — ( 150 ) Purchase of common stock under Employee Stock Purchase Plan 206,310 — 382 — — 382 Stock-based compensation expense — — 20,259 — — 20,259 Net loss — — — ( 142,658 ) — ( 142,658 ) Balance at December 31, 2023 43,270,386 $ 4 $ 550,943 $ ( 380,772 ) $ — $ 170,175 Issuance of common stock upon exercise of stock options 92,283 — 195 — — 195 Issuance of common stock upon vesting of restricted stock 184,380 — — — — — Shares withheld for taxes ( 67,813 ) — ( 141 ) — — ( 141 ) Issuance of common stock pursuant to at-the-market offering, net of issuance costs of $ 0.6 million 6,350,000 1 19,265 — — 19,266 Issuance of common stock and pre-funded warrants pursuant to underwritten public offering, net of issuance costs of $ 6.3 million 32,379,667 3 91,649 — — 91,652 Purchase of common stock under Employee Stock Purchase Plan 360,265 — 335 — — 335 Stock-based compensation expense — — 22,233 — — 22,233 Net income — — — ( 117,122 ) — ( 117,122 ) Other comprehensive income — — — — 16 16 Balance at December 31, 2024 82,569,168 $ 8 $ 684,479 $ ( 497,894 ) $ 16 $ 186,609 The accompanying notes are an integral part of these consolidated financial statements. F- 5 Adicet Bio, Inc. Consolidated Statem ents of Cash Flows (in thousands) Twelve Months Ended December 31, 2024 2023 Cash flows from operating activities Net loss $ ( 117,122 ) $ ( 142,658 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization expense 6,468 6,098 Noncash lease expense 3,197 2,844 Stock-based compensation expense 22,233 20,259 Loss on disposal of lease assets — ( 4 ) Net amortization of premiums and accretion discounts on investments ( 1,668 ) — Goodwill impairment — 19,462 Amortization of deferred debt issuance costs 39 30 Changes in operating assets and liabilities: Prepaid expenses and other current assets ( 1,271 ) 926 Other non-current assets 353 358 Accounts payable 1,106 ( 1,683 ) Operating lease liability ( 3,691 ) ( 99 ) Accrued and other current and non-current liabilities ( 2,022 ) 750 Net cash used in operating activities ( 92,378 ) ( 93,717 ) Cash flows from investing activities Purchases of short-term treasury securities ( 129,124 ) — Maturities of short term treasury securities 11,000 — Purchases of property and equipment ( 1,118 ) ( 4,464 ) Net cash used in investing activities ( 119,242 ) ( 4,464 ) Cash flows from financing activities Proceeds from issuance of common stock pursuant to at-the-market offering, net of issuance costs 19,266 — Proceeds from issuance of common stock and pre-funded warrants pursuant to underwritten public offering, net of issuance costs 91,652 — Proceeds from exercise of stock options 195 4 Proceeds from Employee Stock Purchase Plan 335 382 Taxes withheld and paid related to net share settlement of equity awards ( 141 ) ( 150 ) Net cash provided by financing activities 111,307 236 Net change in cash, cash equivalents and restricted cash ( 100,313 ) ( 97,945 ) Cash, cash equivalents and restricted cash at the beginning of period 159,711 257,656 Cash, cash equivalents and restricted cash at the end of period $ 59,398 $ 159,711 Reconciliation of cash, cash equivalents and restricted cash to consolidated balance sheets: Cash and cash equivalents $ 56,495 $ 159,711 Restricted cash 2,903 — Cash, cash equivalents and restricted cash in consolidated balance sheets $ 59,398 $ 159,711 Supplemental cash flow information Supplemental disclosures of noncash investing and financing activities Purchases of property and equipment included in accounts payable and accrued expenses $ 1,454 $ 279 The accompanying notes are an integral part of these financial statements. F- 6 Adicet Bio, Inc. Adicet Bio, Inc. Notes to Consolidated Financial Statements 1. Organization and Nature of the Business Adicet Bio, Inc. (formerly resTORbio, Inc. (resTORbio), together with its subsidiaries, the Company) is a clinical stage biotechnology company discovering and developing allogeneic gamma delta T cell therapies for autoimmune diseases and cancer. The Company is advancing a pipeline of “off-the-shelf” gamma delta T cells, engineered with chimeric antigen receptors (CARs), to facilitate durable activity in patients. Adicet Bio, Inc. (when referred to prior to the merger, Former Adicet) was incorporated in November 2014 in Delaware. On September 15, 2020, Former Adicet completed a merger (Merger) with resTORbio, pursuant to which Former Adicet merged with a wholly owned subsidiary of resTORbio in an all-stock transaction with Former Adicet surviving as a wholly owned subsidiary of resTORbio and changing its name to “Adicet Therapeutics, Inc.” (Adicet Therapeutics). In connection with the Merger, the Company changed its name from “resTORbio, Inc.” to “Adicet Bio, Inc.” The Company’s principal executive offices are located in Boston, Massachusetts. The Company also has offices in Redwood City, California. Adicet Bio Israel Ltd. (formerly Applied Immune Technologies Ltd.) (Adicet Israel) is a wholly owned subsidiary of the Company and is located in Haifa, Israel. Adicet Israel was founded in 2006. During 2019, the Company consolidated its operations, including research and development activities, in the United States and as a result, substantially reduced its operations in Israel. Adicet (Shanghai) Biotechnology Co., Ltd. (Adicet Shanghai) is a wholly owned subsidiary of Adicet Therapeutics and is located in Shanghai, China. Adicet Shanghai was founded in May 2024. In May 2024, the Company initiated research and development activities in China through a series of contractual agreements entered into and among Shanghai Adicet Biotechnology Co., Ltd., a variable interest entity (the Adicet VIE), Adicet Shanghai, and the shareholders of the Adicet VIE. The Company is the primary beneficiary of the Adicet VIE which is considered a consolidated entity under accounting principles generally accepted in the United States of America (U.S. GAAP). The Company consolidates the financial results of this entity into its consolidated financial statements in accordance with U.S. GAAP. Liquidity The Company has incurred significant net operating losses and negative cash flows from operations and has an accumulated deficit of $ 497.9 million as of December 31, 2024. The Company has historically financed its operations primarily through a collaboration and licensing arrangement, public and private placements of equity securities and debt, and cash received in the Merger with resTORbio. To date, none of the Company’s product candidates have been approved for sale and therefore the Company has not generated any revenue from product sales. Management expects operating losses and negative cash flows to continue for the foreseeable future, until such time, if ever, that it can generate significant sales of its product candidates currently in development. On March 12, 2021, the Company entered into a Capital On Demand™ Sales Agreement (the JonesTrading Sales Agreement) with JonesTrading Institutional Services LLC, as sales agent, to provide for the offering, issuance and sale of up to an aggregate amount of $ 75.0 million of shares of common stock from time to time in “at-the-market” (ATM) offerings. In August 2022, pursuant to the JonesTrading Sales Agreement and subject to the limitations thereof, the Company sold an aggregate of 2,611,723 shares of common stock at $ 17.23 per share resulting in net proceeds to the Company of $ 43.4 million after deducting sales agent commissions and expenses. In November 2022, the Company filed a new prospectus supplement to the 2021 Shelf Registration Statement for the offer and sale of up to $ 100.0 million of shares of common stock from time to time through the sales agent, which includes the $ 30.0 million of shares of common stock not sold under the original prospectus and up to an additional $ 70.0 million of shares of common stock (the JonesTrading ATM Program). In January 2024, the Company raised aggregate net proceeds of approximately $ 19.3 million through the JonesTrading ATM Program. In March 2024, the Company terminated the JonesTrading ATM Program. On January 22, 2024, Adicet entered into an Underwriting Agreement (the Underwriting Agreement) with Jefferies LLC (Jefferies) and Guggenheim Securities, LLC (the Underwriters) related to an underwritten public offering (the Offering) of 27,054,667 shares (the Shares) of common stock of the Company, par value $ 0.0001 per share (the Common Stock), and, in lieu of Common Stock to an investor, pre-funded warrants (the Pre-Funded Warrants) to purchase 8,445,333 shares of Common Stock (the Warrant Shares). The Shares were sold at a public offering price of $ 2.40 per share and the Pre-Funded Warrants were sold at a public offering price of $ 2.3999 per underlying share, which represents the per share public offering price of each share of common stock minus the $ 0.0001 per share exercise price for each pre-funded warrant. The purchase price paid by the Underwriters to the Company was $ 2.256 per Share and $ 2.2559 per Pre-Funded Warrant, representing a discount to the Underwriters of 6.0 %. In addition, the Company granted the Underwriters an option exercisable for 30 days F- 7 Adicet Bio, Inc. Notes to Consolidated Financial Statements from the date of the Underwriting Agreement to purchase, at the public offering price less underwriting discounts and commissions, up to an additional 5,325,000 shares of Common Stock. On January 23, 2024, the Underwriters exercised this option in full. The Company received net proceeds from the Offering, after deducting the underwriting discount and commissions and other estimated offering expenses, of approximately $ 91.7 million. The Company may receive nominal proceeds, if any, from the exercise of the Pre-Funded Warrants. In March 2024, the Company entered into an Open Market Sales Agreement SM (the Jefferies Sales Agreement) with Jefferies to sell shares of its Common Stock from time to time, through an ATM equity offering program under which Jefferies will act as sales agent or principal. As of December 31, 2024, no shares of common stock have been sold under the Jefferies Sales Agreement. The Company expects that its cash, cash equivalents and short-term investments, including the proceeds raised through the JonesTrading ATM Program and the Offering, will be sufficient to fund its forecasted operating expenses, capital expenditure requirements and debt service payments for at least the next twelve months from the issuance of these consolidated financial statements. All of the Company’s revenue to date has been generated from a collaboration and license agreement (the Regeneron Agreement) with Regeneron Pharmaceuticals, Inc, (Regeneron). The Company does not expect to generate any significant product revenue until it obtains regulatory approval of and commercializes any of the Company’s product candidates or enters into additional collaborative agreements with third parties, and it does not know when, or if, either will occur. The Company expects to continue to incur significant losses for the foreseeable future, and it expects the losses to increase as the Company continues the development of, and seeks regulatory approvals for, its product candidates and begins to commercialize any approved products. The Company is subject to all of the risks typically related to the development of new product candidates, including, but not limited to, raising additional capital, development by its competitors of new technological innovations, risk of failure in preclinical and clinical studies, safety and efficacy of its product candidates in clinical trials, the risk of relying on external parties such as contract research organizations (CROs) and contract development and manufacturing organizations (CDMOs), the regulatory approval process, market acceptance of the Company’s products once approved, lack of marketing and sales history, dependence on key personnel and protection of proprietary technology and it may encounter unforeseen expenses, difficulties, complications, delays, and other unknown factors that may adversely affect its business. Until such time as the Company can generate significant revenue from product sales, if ever, the Company expects to finance its operations through the sale of equity, debt financings, collaborative or other arrangements with corporate or other sources of financing. Adequate funding may not be available to the Company on acceptable terms or at all. The Company’s failure to raise capital as and when needed could have a negative impact on its financial condition and the Company’s ability to pursue its business strategies. Although the Company continues to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company to fund continuing operations, if at all. 2. Summary of Significant Accounting Policies Basis of Presentation The consolidated financial statements and related disclosures have been prepared in conformity with accounting principles generally accepted in the United States of America (United States GAAP or GAAP). Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The United States dollar is the functional and reporting currency of the Company and its subsidiaries. The Company assesses entities for consolidation based on the specific facts and circumstances surrounding that entity. The Company first considers whether an entity is considered a variable interest entity (VIE) and therefore whether to apply the consolidation guidance under the VIE model. Entities that do not qualify as VIEs are assessed for consolidation as voting interest entities under the voting interest model. An entity is considered to be a VIE if any of the following conditions exist: (i) the equity investment at risk is not sufficient to finance the activities of the entity without additional subordinated financial support, (ii) as a group, the holders of the equity investment at risk lack the power to direct the activities that most significantly impact the entity’s economic performance or the obligation to absorb the expected losses or right to receive the expected residual returns, and (iii) the voting rights of some holders of the equity investment at risk are disproportionate to their obligation to absorb losses or right to F- 8 Adicet Bio, Inc. Notes to Consolidated Financial Statements receive returns, and substantially all of the activities are conducted on behalf of the holder of equity investment at risk with disproportionately few voting rights. The Company consolidates all VIEs in which it is the primary beneficiary. An entity is determined to be the primary beneficiary if it holds a controlling financial interest in a VIE. The consolidation guidance requires an analysis to determine (i) whether an entity in which the Company holds a variable interest is a VIE and (ii) whether the Company’s involvement, through holding interest directly or indirectly in the entity or contractually through other variable interests, would give it a controlling financial interest. Performance of that analysis requires judgment. As described in Note 1, Shanghai Adicet Biotechnology Co., Ltd., has been identified as a VIE and the Company is the primary beneficiary. Refer to Note 18 for additional information and operating activities for the VIE as of December 31, 2024 . Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities at the date of the consolidated financial statements as well as the reported amounts of revenues and expenses during the reporting period. Such estimates include deferred tax assets, useful lives of property and equipment, accruals for research and development activities, revenue recognition and stock-based compensation and the Company’s incremental borrowing rate. Actual results could differ from those estimates. Goodwill Goodwill represents the excess of the purchase price over the fair value of net tangible and identified intangible assets acquired in a business combination. Goodwill is not amortized but is evaluated at least annually for impairment or when a change in facts and circumstances indicate that the fair value of the goodwill may be below the carrying value. Goodwill is tested for impairment at the reporting unit level annually in the fourth quarter, or more frequently when events or changes in circumstances indicate that the asset might be impaired. Examples of such events or circumstances include, but are not limited to, a significant adverse change in legal or business climate, an adverse regulatory action or unanticipated competition. The Company has determined that it operates in a single operating segment and has a single reporting unit. Prior to performing the impairment test, the Company assesses qualitative factors to determine whether the existence of events or circumstances would indicate that it is more likely than not that the fair value of the reporting unit was less than the carrying amount. If after assessing the totality of events or circumstances, the Company were to determine that it is more likely than not that the fair value of the reporting unit is less than the carrying amount, then the Company would perform a quantitative impairment test. The quantitative impairment test involves comparing the fair value of the reporting unit to the carrying value. If the fair value of the reporting unit exceeds the carrying value of the net assets, goodwill is not impaired, and no further testing is required. If the fair value of the reporting unit is less than the carrying value, the Company measures the amount of impairment loss, if any, as the excess of the carrying value over the fair value of the reporting unit. The Company performed an interim test for goodwill impairment in the third quarter of the fiscal year ended December 31, 2023 and determined that goodwill was impaired. For additional information regarding this assessment, refer to Note 17. Goodwill to our consolidated financial statements. Segments The Company operates and manages its business as one reportable and operating segment, which is the business of research and development of allogeneic gamma delta T cell therapies for autoimmune diseases and cancer. The Company’s Chief Executive Officer, who is the chief operating decision maker, reviews financial information on an aggregate basis for purposes of allocating resources and evaluating financial performance. The Chief Operating Decision Maker (CODM) uses consolidated net loss to monitor budget versus actual results, assess cash runway, and benchmark against the Company’s competitors. The Company adopted ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures in the fourth quarter of 2024. Refer to Note 19. Segment Reporting for the Company's significant segment items. Concentration of Credit Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of cash, cash equivalents, restricted cash and short-term investments in treasury securities. The Company’s cash and cash equivalents, as well as its short-term investments in treasury securities, are held at two financial institutions in the U.S., one financial F- 9 Adicet Bio, Inc. Notes to Consolidated Financial Statements institution in China and one financial institution in Israel and such amounts may, at times, exceed insured limits. The Company invests its cash equivalents in treasury securities and money market funds. The Company limits its credit risk associated with cash equivalents and short-term investments in treasury securities by placing them with banks and institutions it believes are highly creditworthy and in highly rated investments. The Company has not experienced any losses on its deposits of cash and cash equivalents or its short-term investments in treasury securities to date. Risks and Uncertainties The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, protection of proprietary technology, dependence on key personnel, compliance with government regulations and the need to obtain additional financing to fund operations. Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical studies, clinical trials, and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel infrastructure and extensive compliance and reporting. The Company’s product candidates are still in development and, to date, none of the Company’s product candidates have been approved for sale and, therefore, the Company has not generated any revenue from product sales. There can be no assurance that the Company’s research and development will be successfully completed, that adequate protection for the Company’s intellectual property will be obtained or maintained, that any products developed will obtain necessary government regulatory approval or that any approved products will be commercially viable. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will generate revenue from product sales. The Company operates in an environment of rapid change in technology and substantial competition from other pharmaceutical and biotechnology companies. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with maturities of three months or less from the purchase date to be cash equivalents. As of December 31, 2024 , and 2023, cash and cash equivalents consist of cash deposited with banks, investments in money market funds and investments in treasury securities with maturities of three months or less from the date of purchase. Restricted Cash Restricted cash is comprised of cash that is restricted as to withdrawal or use under the terms of certain contractual agreements. Restricted cash for year ended December 31, 2024 consists of collateral for letters of credit issued in connection with real estate leases and a letter of credit issued in connection with corporate credit card services. There was no restricted cash for the year ended December 31, 2023. Refer to Note 20 for additional information regarding restricted cash. Short-Term Investments The Company classifies investments with original maturities of greater than three months and less than twelve months from the date of purchase as short-term investments on its consolidated balance sheets. The Company’s short-term investments are maintained by investment managers and consist of treasury securities. Treasury securities are carried at fair value with the unrealized gains and losses included in other comprehensive income (loss) as a component of stockholders’ equity until realized. Amortization and accretion of premiums and discounts are recorded in interest income, net on the Company's consolidated statements of operations and comprehensive loss. Fair Value of Financial Instruments The carrying amounts of certain financial instruments of the Company, including cash equivalents, restricted cash, accounts payable and accrued and other current liabilities approximate fair value due to their relatively short maturities. Financial instruments, such as money market funds and treasury securities are measured at fair value at each reporting date. Refer to Note 3. Fair Value Measurements. F- 10 Adicet Bio, Inc. Notes to Consolidated Financial Statements Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed on a straight-line basis over the estimated useful lives of the related assets, generally three years. Leasehold improvements are amortized using the straight-line method over the lesser of the assets’ estimated useful lives or the remaining term of the lease. Maintenance and repairs are charged to operations as incurred. When assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the consolidated balance sheet and any resulting gain or loss is reflected in the consolidated statements of operations in the period realized. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Recoverability is measured by comparison of the carrying amount of the asset or asset group to the future net cash flows which the asset or asset group is expected to generate. If such asset or asset group is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset or asset group exceeds the fair value of the asset or asset group. No such impairments were recognized for the years ended December 31, 2023 and 2024. Revenue Recognition Under ASC 606, Revenue from Contracts with Customers (ASC 606), the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps as prescribed by ASC 606: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. A contract with a customer exists when (i) the Company enters into a legally enforceable contract with a customer that defines each party’s rights regarding the products or services to be transferred and identifies the payment terms related to these products or services, (ii) the contract has commercial substance and (iii) the Company determines that collection of substantially all consideration for products or services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company identifies the goods or services promised and determines the performance obligations by assessing whether each promised good or service is distinct. Goods or services that are not distinct are bundled with other goods or services in the contract until a bundle of goods or services that is distinct is created. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. For revenue recognition purposes, the Company determines the term of its license or collaboration agreements by evaluating the period during which present and enforceable rights and obligations exist. This determination is impacted by the existence of substantive termination penalties, among other factors. The Company recognizes revenue under the Company’s license or collaboration agreements that are within the scope of ASC 606. These agreements include promises related to licenses to intellectual property and research and development services. If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenue from non-refundable, up-front fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgement to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. Accordingly, the transaction price is generally comprised of a fixed fee due at contract inception and at specified future dates, variable consideration in the form of milestone F- 11 Adicet Bio, Inc. Notes to Consolidated Financial Statements payments due upon the achievement of specified events and tiered royalties earned when customers recognize net sales of licensed products. The Company measures the transaction price based on the amount of consideration to which it expects to be entitled in exchange for transferring the promised goods and/or services to the customer. The Company utilizes the “most likely amount” method to estimate the amount of variable consideration to which it will be entitled for the contract. Amounts of variable consideration are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. At the inception of each arrangement that includes development and regulatory milestone payments, the Company evaluates whether the associated event is considered most likely to be achieved and estimates the amount to be included in the transaction price. Payments or reimbursements for the Company’s research and development efforts where such efforts are considered part of or a single performance obligation are recognized over time using a measure of progress that best reflects the Company’s performance in satisfying the obligation. Upfront payments are recorded as contract liabilities upon receipt or when due and may require deferral of revenue recognition to a future period until the Company performs its obligation under these arrangements. Amounts payable to the Company 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 at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less. For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized any royalty revenue resulting from its collaboration arrangement. Research and Development Expenses Research and development expenses include costs directly attributable to the conduct of research and development programs, including payroll and related expenses, costs for CDMOs, costs for CROs, materials, supplies, depreciation on and maintenance of research equipment, consulting costs, and the allocated portions of facility costs, such as rent, utilities, insurance, repairs and maintenance, depreciation, information technology costs and general support services. All costs associated with research and development are expensed within the consolidated statements of operations as incurred. Costs incurred in obtaining technology licenses are charged to research and development expense as acquired in-process research and development if the technology licensed has not reached technological feasibility and has no alternative future use. Accrued CRO, CDMO, and Research and Development Expenses The Company has entered into various agreements with CDMOs and CROs. The Company’s research and development accruals are estimated based on the level of services performed, progress of the studies, including the phase or completion of events, and contracted costs. The estimated costs of research and development provided, but not yet invoiced are included in accrued and other current liabilities on the consolidated balance sheets. If the actual timing of the performance of services or the level of effort varies from the original estimates, the Company will adjust the accrual accordingly. Payments made to CDMOs and CROs under these arrangements in advance of the performance of the related services are recorded as prepaid expenses and other current assets on the consolidated balance sheets until the services are rendered. Through December 31, 2024 , there had been no material adjustments to the Company’s prior period estimates of accrued research and development expenses. Leases Consistent with ASU No. 2016-02, Leases (Topic 842) (ASU 2016-02), the Company determines if an arrangement is a lease, or contains a lease, at inception. Leases with a term greater than 12 months are recognized on the balance sheet as Right-of-Use (ROU) assets and current and long-term operating lease liabilities, as applicable. The Company has elected not to recognize on the balance sheet leases with terms of 12 months or less. The Company typically only includes an initial lease term in its assessment of a lease arrangement. Options to renew a lease are not included in the Company’s assessment unless there is reasonable certainty that the Company will renew. The Company monitors its plan to renew its leases no less than on a quarterly basis. In addition, the Company’s lease agreements generally do not contain any residual value guarantees or restrictive covenants. In accordance with ASU 2016-02, the ROU assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company F- 12 Adicet Bio, Inc. Notes to Consolidated Financial Statements uses its incremental borrowing rate (IBR), which is the estimated rate the Company would be required to pay for a fully collateralized borrowing equal to the total lease payments over the term of the lease, to determine the present value of future minimum lease payments. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. For lease agreements entered into or reassessed after the adoption of ASU 2016-02, the Company does not combine lease and non-lease components. Variable lease payments are expenses as incurred. Assumptions made by the Company at the commencement date are re-evaluated upon occurrence of certain events, including a lease modification. A lease modification results in a separate contract when the modification grants the lessee an additional right of use not included in the original lease and when lease payments increase commensurate with the standalone price for the additional right of use. When a lease modification results in a separate contract, it is accounted for in the same manner as a new lease. Stock-Based Compensation The Company accounts for stock-based compensation arrangements with employees and non-employees using a fair value method which requires the recognition of compensation expense for costs related to all stock-based payments including stock options. The fair value method requires the Company to estimate the fair value of stock-based payment awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option-pricing model to estimate the fair value of options granted that are expensed on a straight-line basis over the requisite service period, which is generally the vesting period. The Company accounts for forfeitures as they occur. Option valuation models, including the Black-Scholes option-pricing model, require the input of several assumptions. Changes in the assumptions used can materially affect the grant-date fair value of an award. These assumptions include the risk-free rate of interest, expected dividend yield, expected volatility and the expected life of the award. For awards that have a performance condition, the Company recognizes compensation expense based on its assessment of the probability that the performance condition will be achieved, using an accelerated attribution model, over the explicit or implicit service period. Income Taxes The Company accounts for income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences attributable to differences between carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting purposes and for operating loss and tax credit carryforwards. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. The Company’s deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which these temporary differences are expected to be recovered or settled. A valuation allowance is recorded to reduce deferred tax assets if it is determined that it is more likely than not that all or a portion of the deferred tax asset will not be realized. The Company considers many factors when assessing the likelihood of future realization of deferred tax assets, including recent earnings results, expectations of future taxable income, carryforward periods available and other relevant factors. The Company records changes in the required valuation allowance in the period that the determination is made. The Company assesses its income tax positions and records tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances and information available as of the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, the Company records the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority having full knowledge of all relevant information. For those income tax positions where it is not more likely than not that a tax benefit will be sustained, the Company does not recognize a tax benefit in the consolidated financial statements. The Company records interest and penalties related to uncertain tax positions, if applicable, as a component of income tax expense (benefit). Net Loss per Share Basic net loss per common share is calculated by dividing the net loss by the weighted-average number of common stock outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common stock and potentially dilutive securities outstanding for the period. The Company’s potentially dilutive shares, which include outstanding stock options, Employee Stock Purchase Plan (ESPP) awards and unvested restricted stock units (RSUs), are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. Basic and diluted net loss per share is presented in conformity with the two-class method required for participating securities. The two-class method determines net income (loss) per share for each class of common and participating securities according to dividends declared or accumulated and participation rights in undistributed earnings. The two-class method requires income (loss) available to common stockholders for the period to be allocated between common and participating securities based upon their respective rights to share in undistributed earnings as if all income (loss) for the period had been distributed. The Company’s participating securities do not have a contractual F- 13 Adicet Bio, Inc. Notes to Consolidated Financial Statements obligation to share in the Company’s losses. As such, the net loss is attributed entirely to common stockholders. Since the Company has reported a net loss for all periods presented, diluted net loss per common share is the same as basic net loss per common share for those periods. Subsequent Events Considerations The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the consolidated financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. The Company has evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure, other than as disclosed in these notes to the consolidated financial statements. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB under its ASC or other standard setting bodies and adopted by the Company as of the specified effective date, unless otherwise discussed below. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. This ASU replaces the existing incurred loss impairment model with an expected loss model. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. For SEC filers that are eligible to be smaller reporting companies, this ASU is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. Early adoption is permitted. The Company adopted ASU 2016-13 in the first quarter of 2023. The impact on its consolidated financial statements and related disclosures was not material. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (ASU 2017-04). The new guidance simplifies the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment requires an entity to perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. SEC filers that are eligible to be smaller reporting companies should adopt the amendments in this update for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2022. The amendment should be applied on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company adopted ASU 2017-04 in the first quarter of 2023. The impact on its consolidated financial statements and related disclosures was not material. In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , which enables investors to better understand an entity's overall performance and assists with assessing potential future cash flows. This amendment improves financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more decision-useful financial analyses. It is applicable to all public entities that are required to report segment information in accordance with Topic 280, Segment Reporting. For SEC filers, this ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company adopted ASU 2023-07 in the fourth quarter of 2024. Refer to Note 19. Segment Reporting. Accounting Pronouncements Not Yet Adopted In September 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which enhances the transparency and usefulness of income tax disclosures. This amendment requires public issuers to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than 5 percent of the amount computed by multiplying pretax income, or loss, by the applicable statutory income tax rate. Additionally, this amendment requires issuers to disclose the amount of income taxes paid (net of refunds received) disaggregated by federal (national), state, and foreign taxes as well as the amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions in which income taxes paid (net of refunds received) is equal to or greater than 5 percent of total income taxes paid (net of refunds received). For SEC filers, this ASU is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company F- 14 Adicet Bio, Inc. Notes to Consolidated Financial Statements is currently evaluating the impact the adoption that this ASU will have on its consolidated financial statements and related disclosures. 3. Fair Value Measurements The Company determines the fair value of financial and non-financial assets and liabilities using the fair value hierarchy which establishes three level of inputs that may be used to measure fair value, as follows: Level 1 — Observable inputs, such as quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Unobservable inputs which reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values (in thousands): December 31, 2024 Level 1 Level 2 Level 3 Total Assets: Treasury securities (1) (3) $ 119,808 $ — $ — $ 119,808 Money market funds (2) (3) 27,084 — — 27,084 Total fair value of assets $ 146,892 $ — $ — $ 146,892 December 31, 2023 Level 1 Level 2 Level 3 Total Assets: Treasury securities (2) (3) $ 115,143 $ — $ — $ 115,143 Total fair value of assets $ 115,143 $ — $ — $ 115,143 F- 15 Adicet Bio, Inc. Notes to Consolidated Financial Statements (1) Included in short-term investments in treasury securities in the consolidated balance sheets. These securities have maturity dates of greater than three months, but less than twelve months from the date of purchase. (2) Included in cash and cash equivalents in the consolidated balance sheets. These securities have maturity dates of less than three months from the date of purchase. (3) Treasury securities and money market funds are included within Level 1 of the fair value hierarchy because they are actively traded and valued using quoted market prices. 4. Marketable Securities The following table shows the Company's available-for-sale securities adjusted cost, net unrealized gains and losses and fair value by significant investment category as of December 31, 2024. There were no marketable securities during the year ended December 31, 2023. December 31, 2024 Adjusted Cost Unrealized Gains Unrealized Losses Fair Value Marketable Securities: Treasury securities $ 119,792 $ 16 $ — $ 119,808 Total $ 119,792 $ 16 $ — $ 119,808 5 . Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): December 31, 2024 December 31, 2023 Prepayments to CROs and CDMOs $ 1,138 $ 53 Prepaid insurance 916 1,014 Prepaid software subscription and licensing fees 518 582 Prepaid maintenance 427 373 Prepaid employee benefits 310 — Prepaid professional services 50 82 Other prepaid expenses and current assets 474 457 Total prepaid expenses and other current assets $ 3,833 $ 2,561 6 . Property and Equipment, net Property and equipment, net consisted of the following (in thousands): Useful life (in years) December 31, 2024 December 31, 2023 Leasehold improvements Lesser of useful life or lease term $ 28,228 $ 26,643 Laboratory equipment 3 13,859 13,165 Furniture and fixtures 3 951 951 Construction in progress — 198 265 Computer equipment 3 192 189 Software 3 411 411 43,839 41,624 Less: Accumulated depreciation and amortization ( 21,315 ) ( 14,847 ) Property and equipment, net $ 22,524 $ 26,777 All of the Company’s property and equipment as of December 31, 2024 and 2023 is located in the U.S. Depreciation and amortization expense for the years ended December 31, 2024 and 2023 was $ 6.5 million and $ 6.1 million. F- 16 Adicet Bio, Inc. Notes to Consolidated Financial Statements Construction in progress has decreased by less than $ 0.1 million during the year ended December 31, 2024 , compared to the balance at December 31, 2023. The remaining $ 0.2 million in construction in progress as of December 31, 2024 is primarily related to lab and computer equipment not yet placed into service. 7 . Accrued and Other Current Liabilities Accrued and other current liabilities consisted of the following (in thousands): December 31, 2024 December 31, 2023 Accrued compensation $ 7,112 $ 6,514 Accrued CDMO costs 1,685 5,679 Accrued professional services 722 625 Accrued other research and development expenses 398 354 Accrued CRO costs 1,490 257 Accrued other liabilities 23 12 Total accrued and other liabilities $ 11,430 $ 13,441 8 . Term Loan On April 28, 2020, the Company entered into a Loan and Security Agreement (the Loan Agreement) as amended on July 8, 2020, September 14, 2020, September 15, 2020, October 21, 2021 (the 2021 Loan Amendment), December 2, 2022 (the 2022 Loan Amendment) and May 30, 2023 with Banc of California (formerly known as Pacific Western Bank) to finance leasehold improvements for the facilities in Redwood City, CA and other purposes permitted under the Loan Agreement. Under the 2021 Loan Amendment, Banc of California will provide one or more Term Loans (as defined in the 2021 Loan Amendment), as well as Non-Formula Ancillary Services which shall not exceed $ 5.5 million in the aggregate. Non-Formula Ancillary Services are defined as automated clearinghouse transactions, corporate credit card services, letters of credit, or other treasury management services. Per the terms of the Loan Agreement, the aggregate sum of the outstanding Term Loans and Non-Formula Ancillary Services shall at no time exceed $ 15.0 million, which each Term Loan to be in an amount of not less than $ 1.0 million. On March 13, 2023, the Company and Banc of California executed a letter agreeing that, notwithstanding the covenants included in the 2022 Loan Amendment, until June 30, 2023 (i) the Company and its subsidiaries will not be required to maintain the lesser of $ 200 million or seventy percent (70%) of its combined balances in demand deposit accounts, money market funds and/or insured cash sweep (ICS) accounts with Banc of California and (ii) the Company must maintain its combined balances at Banc of California or its affiliates, including Pacific Western Asset Management (the Letter). On May 30, 2023, the Company further amended its Loan Agreement with Banc of California (the 2023 Loan Amendment). Pursuant to the 2023 Loan Amendment, the Company must maintain the lesser of (i) $ 35.0 million or (ii) all of the Company’s combined balances in demand deposit accounts, money market accounts, and/or insured cash sweep accounts with Banc of California. If the Company’s total cash and investments drop to less than $ 35.0 million, the 2023 Loan Amendment permits the Company to maintain cash and/or investments in one or more accounts outside of Banc of California up to a total of $ 2.5 million. In April 2024, the Term Loan availability under the Loan Agreement expired. The Non-Formula Ancillary Services, which shall not exceed $ 5.5 million in the aggregate, remained available. On November 27, 2024, the Company executed a payoff letter (the Payoff Letter) with Banc of California to repay in full all outstanding indebtedness and terminate all commitments and obligations, subject to certain exceptions, under the Loan Agreement. Under the Payoff Letter, the Company agreed to pay Banc of California approximately $ 10,000 in administrative fees and establish cash collateral accounts and execute pledge and security agreements to secure ancillary services provided by Banc of California. The Company paid the $ 10,000 administrative fees in December 2024. As of December 31, 2024, we have $ 2.9 million of restricted cash held in cash collateral accounts. No termination penalty was paid in connection with the Payoff Letter. F- 17 Adicet Bio, Inc. Notes to Consolidated Financial Statements 9 . Third Party Agreements Regeneron On July 29, 2016, the Company entered into a license and collaboration agreement with Regeneron, which was amended in April 2019, with such amendment becoming effective in connection with Regeneron’s investment in the Company’s Series B redeemable convertible preferred stock private placement transaction in July 2019 (as amended, the Regeneron Agreement). Financial Terms. The Company received a non-refundable upfront payment of $ 25.0 million from Regeneron upon execution of the Regeneron Agreement and an aggregate of $ 20.0 million of additional payments for research funding from Regeneron as of December 31, 2024 . In addition, Regeneron may have to pay the Company additional amounts in the future consisting of up to an aggregate of $ 80.0 million of option exercise fees, as specified in the Regeneron Agreement. Per the terms of the agreement, Regeneron must pay the Company high single digit royalties as a percentage of net sales for immune cell products (ICPs) to targets for which it has exclusive rights, and low single digit royalties as a percentage of net sales on any non-ICP product comprising a targeting moiety generated by the Company through the use of Regeneron’s proprietary mice. The Company must pay Regeneron mid-single to low double digit, but less than teens, of royalties as a percentage of net sales of ICPs to targets for which the Company has exercised exclusive rights, and low to mid-single digit of royalties as a percentage of net sales of targeting moieties generated from the Company’s license to use Regeneron’s proprietary mice. Royalties are payable until the longer of the expiration or invalidity of the licensed patent rights or twelve (12) years from first commercial sale. No royalties have been earned or paid under the Regeneron Agreement through December 31, 2024. On January 28, 2022, Regeneron exercised its option to license the exclusive, worldwide rights to ADI-002, an allogeneic gamma delta CAR T cell therapy directed against Glypican-3, pursuant to the Regeneron Agreement. In conjunction with the exercise of the option, Regeneron paid an exercise fee of $ 20.0 million to the Company on January 28, 2022, and the Company completed the transfer of the associated license rights to Regeneron during the first quarter of 2022. The $ 20.0 million option exercise fee, plus $ 5.0 million of revenue recognized relating to the combined performance obligation, resulted in an aggregate of $ 25.0 million recorded as revenue for the year ended December 31, 2022. The Company's obligations under the combined performance obligation were completed during the year ended December 31, 2022. Regeneron is responsible, at its sole cost, for all development, manufacturing and commercialization of ADI-002 and must pay the Company high single digit royalties as a percentage of any net sales of ADI-002 for a period commencing on the first commercial sale until the longer of (i) the expiration or invalidity of the licensed patent rights or (ii) a low double digit amount of years from first commercial sale. Twist Bioscience In March 2021, the Company entered into an Antibody Discovery Agreement (the Twist Agreement) with Twist Bioscience Corporation (Twist). Under the terms of the Twist Agreement, Twist will utilize its proprietary platform technology to assist the Company with the discovery of novel antibodies related to target antigens selected by the Company. The Company maintains the sole and exclusive rights to any program antibodies discovered under the Twist Agreement and has the right to patent, assign, license or transfer any work product under the agreement. Furthermore, the Company has the right to sublicense its rights to program antibodies to third parties. The Company may terminate the Twist Agreement at any time, with or without cause, upon a specified period advance written notice. Per the terms of the agreement, the Company will pay Twist an upfront, non-refundable project initiation fee, a technology access fee, as well as a project fee for each project entered into under the agreement. Additionally, the Company will pay fees for development and regulatory milestones in the tens of millions of dollars and low single digit royalties on net sales to Twist for programs initiated under the agreement. In November 2022, the Company entered into an amendment to the Twist Agreement (the Twist Amendment). The Twist Amendment updates the language associated with Twist's audit rights as well as the amounts associated with technology access fees. On a cumulative basis as of December 31, 2024 , the Company has incurred and expensed $ 1.0 million related to project initiation fees, technology access fees and projects fees as research and development expense related to this agreement. F- 18 Adicet Bio, Inc. Notes to Consolidated Financial Statements 10 . Commitments and Contingencies Operating Leases The Company leases office and laboratory space in Redwood City, California, and Boston, Massachusetts. Redwood City In 2018, Adicet Therapeutics executed a non-cancelable lease agreement, as amended in 2022, pursuant to which the Company leases office and laboratory facility at 1000 Bridge Parkway and a portion of 1200 Bridge Parkway in Redwood City, California (the Redwood City Lease). On January 9, 2023, Adicet Therapeutics entered into a third lease amendment with Westport Office Park, LLC (the Third Amendment). The Third Amendment further amends the Redwood City Lease and increases the tenant improvement allowance as of January 1, 2023 by an additional $ 3.0 million. The Company fully utilized the allowance for the continued buildout of office and laboratory space at 1000 Bridge Parkway in 2023. Per the terms of this amendment, this additional allowance will be repaid through equal monthly payments of principal amortization and interest on a monthly basis over the term of the lease at an interest rate of eight percent ( 8 %) per annum. The Company received the allowance on February 21, 2023 and increased the operating lease liability accordingly. On August 7, 2023, Adicet Therapeutics entered into a fourth lease amendment with Westport Office Park, LLC (the Fourth Amendment). The Fourth Amendment amends the period over which the tenant improvement allowance received in the Third Amendment will be amortized and identifies the monthly amortization payable by the Company. Boston In 2018, the Company entered into a lease agreement, as amended in 2019, for office space at 500 Boylston St, Boston, Massachusetts (500 Boylston Lease). Under the terms of the 500 Boylston Lease, the Company was permitted to assign, sublease or transfer this lease, with the consent of the landlord. On July 19, 2021, the Company entered into a sublease agreement with RFS OPCO LLC (Sublessee), whereby the Company agreed to sublease to Sublessee all of the 9,501 rentable square feet of 500 Boylston St. The expected undiscounted cash flows to be received from the sublease as of December 31, 2024 is as follows (in thousands): December 31, 2024 2025 736 2026 438 2027 and thereafter — Total $ 1,174 The Company recognized rent expense, net of sublease income, of $ 4.0 million for both the years ended December 31, 2024 and 2023. F- 19 Adicet Bio, Inc. Notes to Consolidated Financial Statements Further, the Company remains liable for the remaining lease payments under the 500 Boylston Lease, totaling $ 1.0 million, which is included in the future minimum lease payments table below. The future minimum lease payments under all non-cancelable operating lease obligations as of December 31, 2024 were as follows (in thousands): December 31, 2024 2025 $ 4,662 2026 4,009 2027 3,714 2028 3,808 2029 3,906 2030 and thereafter 662 Total undiscounted lease payments 20,761 Less: imputed interest ( 3,527 ) Total operating lease liability 17,234 Less: current portion ( 3,132 ) Operating lease liability, net of current maturities $ 14,102 The IBR and the remaining lease terms of our facilities and their weighted average IBR and remaining terms are as follows as of December 31, 2024: Lease Locations IBR Remaining Terms (in years) Redwood City, CA (1000 Bridge Parkway) 6.90 % 5.20 Redwood City, CA (1200 Bridge Parkway) 6.80 % 0.50 Boston, MA 9.30 % 1.60 Weighted Average 7.00 % 4.90 The following table presents the operating lease cost and information related to the operating lease right-of-use assets, net and operating lease liabilities for the year ended December 31, 2024 (in thousands): Twelve Months Ended December 31, 2024 2023 Lease Cost Operating lease cost $ 4,557 $ 4,510 Short-term lease cost 121 195 Sublease income ( 727 ) ( 714 ) Total lease cost $ 3,951 $ 3,991 Other Information Operating cash flows used for lease liabilities $ ( 3,691 ) $ ( 99 ) Weighted-average remaining lease term - operating leases 4.9 5.7 Weighted-average discount rate - operating leases 7.0 % 7.1 % As of December 31, 2024 , operating right-of-use assets were $ 14.2 million and operating lease liabilities were $ 17.2 million. The Company has no material finance leases. The Company maintains letters of credit in connection with the Company’s office leases in Redwood City, CA and Boston, MA. Refer to Note 20. Restricted Cash for additional information about these letters of credit. Indemnification Agreements In the ordinary course of business, the Company enters into agreements that may include indemnification provisions. Pursuant to such agreements, the Company may indemnify, hold harmless and defend an indemnified party for losses suffered or incurred by the indemnified party. Some of the provisions will limit losses to those arising from third-party actions. In some cases, the indemnification will continue after the termination of the agreement. The maximum potential amount of future F- 20 Adicet Bio, Inc. Notes to Consolidated Financial Statements payments the Company could be required to make under these provisions is not determinable. The Company has never incurred material costs to defend lawsuits or settle claims related to these indemnification provisions. The Company has also entered into indemnification agreements with its directors and officers that require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers to the fullest extent permitted by Delaware corporate law. The Company currently has directors’ and officers’ liability insurance. 11. Stockholders' Equity Common Stock The Company’s Restated Certificate of Incorporation, which became effective as of June 6, 2024, authorized the Company to issue 300,000,000 shares of common stock, par value $ 0.0001 per share, as of December 31, 2024. Common stockholders are entitled to dividends if and when declared by the Board of Directors of the Company subject to the prior rights of the preferred stockholders. As of December 31, 2024 , no dividends on common stock had been declared by the Board of Directors. The Company has the following shares of common stock reserved for future issuance: December 31, 2024 December 31, 2023 Stock options and restricted stock units available for future grant 3,082,030 2,473,485 Stock options issued and outstanding 14,965,270 9,383,105 Unvested restricted stock units 719,656 454,200 Common stock warrants issued and outstanding 8,445,333 — Total common stock reserved 27,212,289 12,310,790 On January 22, 2024, the Company entered into the Underwriting Agreement with Jefferies and Guggenheim Securities, LLC, as representatives of the Underwriters, related to the Offering of 32,379,667 shares of our common stock, which included 5,325,000 shares sold and issued upon the exercise in full by the Underwriters of their option to purchase additional shares of common stock, and, in lieu of common stock to certain investors, pre-funded warrants to purchase 8,445,333 shares of common stock. The pre-funded warrants were sold at a public offering price of $ 2.3999 per pre-funded warrant, which represents the per share public offering price of each share of common stock minus the $ 0.0001 per share exercise price for each pre-funded warrant. The pre-funded warrants do not have an expiration date and are exercisable at any time. The pre-funded warrants are classified as equity within the Company's consolidated balance sheet. The Company received net proceeds from the Offering, after deducting the underwriting discount and commissions and other estimated offering expenses, of approximately $ 91.7 million. The Company may receive nominal proceeds, if any, from the exercise of the pre-funded warrants. The following provides a roll forward of outstanding pre-funded warrants to purchase common stock as of December 31, 2024: Issuance Date Number of Shares of Common Stock Issuable Weighted Average Exercise Price Outstanding, December 31, 2023 — — Warrants issued 8,445,333 $ 0.0001 Warrants exercised — — Warrants forfeited — — Outstanding, December 31, 2024 8,445,333 $ 0.0001 F- 21 Adicet Bio, Inc. Notes to Consolidated Financial Statements 12. Stock-Based Compensation Stock-based Compensation Expense The following table presents stock-based compensation expense as reflected in the Company's consolidated statements of operations (in thousands): Twelve Months Ended December 31, 2024 2023 Research and development $ 10,714 $ 9,143 General and administrative 11,519 11,116 Total stock-based compensation $ 22,233 $ 20,259 The following table presents stock-based compensation expense by type of award (in thousands): Year Ended December 31, 2024 2023 Stock options $ 20,608 $ 18,060 Restricted stock units 1,470 2,023 Employee Stock Purchase Plan 155 176 Total $ 22,233 $ 20,259 Stock Options A summary of stock option activity for the year ended December 31, 2024 is set forth below (in thousands, except share and per share data): Number of Shares Underlying Outstanding Options Weighted Average Exercise Price Weighted- Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) Outstanding, December 31, 2023 9,383,105 $ 10.64 8.2 $ 45 Options granted 7,549,053 $ 2.47 Options exercised ( 92,283 ) $ 2.12 Options forfeited or cancelled ( 1,874,605 ) $ 7.60 Outstanding, December 31, 2024 14,965,270 $ 3.09 8.1 $ — Options exercisable, December 31, 2024 7,327,757 $ 3.41 7.4 $ — Vested and expected to vest, December 31, 2024 14,965,270 $ 3.09 8.1 $ — The assumptions used in the Black Scholes Model to calculate stock-based compensation are as follows: Twelve Months Ended December 31, 2024 2023 Fair value of common stock $ 0.96 - $ 3.12 $ 1.32 - $ 9.15 Expected term (years) 5.5 - 6.08 5.5 - 6.1 Volatility 82.15 % - 88.46 % 83.25 % - 92.87 % Risk free rates 3.63 % - 4.52 % 3.5 % - 4.86 % Dividend rate 0.0 % 0.0 % The fair value of each stock option was estimated at the date of grant using a Black-Scholes option-pricing model using the following assumptions: F- 22 Adicet Bio, Inc. Notes to Consolidated Financial Statements The assumptions are as follows: • Expected volatility. The Company has limited trading history. As such, the expected volatility was determined by examining the historical volatilities for comparable publicly traded companies within the biotechnology and pharmaceutical industry using an average of historical volatilities of the Company’s industry peers. • Risk-free interest rate. The risk-free interest rate is based on the United States Treasury yield with a maturity equal to the expected term of the option in effect at the time of grant. • Dividend yield. The expected dividend is assumed to be zero as dividends have never been paid and there are no current plans to pay dividends on common stock. • Expected term. The expected term represents the period that the stock-based awards are expected to be outstanding. The expected term is calculated using the simplified method which is used when there is insufficient historical data about exercise patterns and post-vesting employment termination behavior. The simplified method is based on the vesting period and the contractual term for each grant, or for each vesting-tranche for awards with graded vesting. The mid-point between the vesting date and the maximum contractual expiration date is used as the expected term under this method. For awards with multiple vesting-tranches, the times from grant until the mid-points for each of the tranches may be averaged to provide an overall expected term. The Company will continue to use judgment in evaluating the expected volatility, risk-free interest rates, dividend yield and expected term, utilized for stock-based compensation on a prospective basis. The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying stock options and the fair value of the Company’s common stock for stock options that were in-the-money at December 31, 2024 and 2023. The aggregate intrinsic value of stock options exercised was less than $ 0.1 million during the years ended December 31, 2024 and 2023. The total fair value of options that vested during the years ended December 31, 2024 and 2023 was $ 18.0 million and $ 17.9 million, respectively. The options granted during the years ended December 31, 2024 and 2023 had a weighted-average per share grant-date fair value of $ 1.40 per share and $ 3.94 per share, respectively. As of December 31, 2024 , the total unrecognized stock-based compensation expense related to unvested stock options was $ 18.6 million, which is expected to be recognized over the remaining weighted-average vesting period of 2.3 years. In August 2024, certain of our executive officers entered into an option cancellation agreement to surrender certain underwater stock options. This voluntary surrender of stock options was determined to be a settlement for no consideration and the remaining unrecognized compensation cost was recognized immediately upon cancellation. This resulted in $ 1.6 million of stock-based compensation recognized in the third quarter of 2024 for these options. Restricted Stock Units The summary of RSU activity and related information for the year ended December 31, 2024 is set forth below: Number of Units Outstanding Weighted Average Grant Date Fair Value Outstanding, December 31, 2023 454,200 $ 7.69 RSUs granted 537,400 $ 2.60 RSUs vested ( 184,380 ) $ 7.15 RSUs forfeited ( 87,564 ) $ 4.21 Outstanding, December 31, 2024 719,656 $ 4.40 F- 23 Adicet Bio, Inc. Notes to Consolidated Financial Statements The Company granted 537,400 and 513,700 RSU's in the years ended December 31, 2024 and 2023, respectively. The weighted-average grant date fair value of RSUs granted during the years ended December 31, 2024 and 2023 was $ 2.60 and $ 7.47 , respectively. As of December 31, 2024, there was approximately $ 1.9 million of unrecognized compensation cost related to unvested RSUs that the Company expects to recognize over a remaining weighted-average period of approximately 1.6 years. Option repricing On August 8, 2023, the board of directors approved a stock option repricing (the Option Repricing) effective on August 14, 2023 (the Effective Date) in accordance with the terms of the Company’s 2015 Stock Incentive Plan (the 2015 Plan) and Second Amended and Restated 2018 Stock Option and Incentive Plan (the 2018 Plan, and together with the 2015 Plan, the Plans). Pursuant to the Option Repricing, the exercise price of each stock option previously granted under the Plans, totaling 6,431,910 options, was amended to reduce the exercise price of such options to $ 2.14 per share, the closing price of the Company’s common stock on the Nasdaq Global Market on the Effective Date. The repriced options otherwise retained their existing terms and conditions as set forth in the Plans and applicable award agreements. The stock option modification resulted in $ 4.6 million of incremental compensation cost, which was calculated using the Black-Scholes option-pricing model. Of the incremental compensation cost, $ 2.3 million and $ 1.3 million was recognized in the twelve months ended December 31, 2024 and 2023, respectively. The remaining incremental compensation cost of $ 0.6 million, net of the reversal of expense related to employee terminations prior to August 14, 2024, will be recognized on the straight-line basis over the remaining vesting period of the repriced options. The incremental cost is included in general and administrative expense and research and development expense on the consolidated statements of operations. Effective August 21, 2024, the board of directors approved a rescission of the Option Repricing for certain non-employee directors of the Company. All of the affected stock options have been reverted to their original exercise price as established at the time of the grant. The Company will continue to recognize the incremental fair value from the Option Repricing for the impacted options. The compensation expense associated with the Option Repricing for these options was not material. 13. Net Loss Per Share The following table sets forth the computation of basic and diluted net loss per share (in thousands, except share and per share data): Twelve Months Ended December 31, 2024 2023 Net loss - basic and diluted $ ( 117,122 ) $ ( 142,658 ) Weighted-average shares used in computing net loss per share, basic and diluted 87,866,435 43,042,405 Net loss per share, basic and diluted $ ( 1.33 ) $ ( 3.31 ) The Company's potentially dilutive shares as of December 31, 2024 and 2023, which include outstanding stock options and unvested RSUs, are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net loss per share for the period presented because including them would have been antidilutive: As of December 31, 2024 2023 Options to purchase common stock 14,965,270 9,383,105 Unvested restricted stock units 719,656 454,200 Total 15,684,926 9,837,305 F- 24 Adicet Bio, Inc. Notes to Consolidated Financial Statements 14. Income Taxes The components of the provision for (benefit from) income taxes are as follows (in thousands): December 31, 2024 2023 Current: Federal $ — $ — State — — Foreign — — Total current — — Deferred: Federal — — State — — Foreign — — Total deferred — — Provision for (benefit from) income taxes $ — $ — There was no income tax expense nor benefit for the years ended December 31, 2024 and 2023. For the rate table below the (provision for) benefit from income taxes differ from the amount expected by applying the federal statutory rate to the loss before taxes as follows: Year Ended December 31, 2024 2023 Federal statutory income tax rate 21.0 % 21.0 % State income taxes 0.1 % ( 8.3 )% Change in valuation allowance ( 17.5 )% ( 7.0 )% Stock-based compensation ( 3.3 )% ( 2.7 )% Goodwill Impairment — ( 2.9 )% Foreign Rate Differential ( 0.2 )% — Other permanent differences ( 0.1 )% ( 0.1 )% Provision for income taxes ( 0.0 )% ( 0.0 )% The tax effects of temporary differences and carryforwards of the deferred tax assets are presented below (in thousands): December 31, 2024 2023 Deferred Tax Assets: Net operating loss carryforwards $ 74,848 $ 65,601 Operating lease right-of-use asset liability 3,638 4,414 Stock-based compensation 3,009 2,285 Intangible assets 621 704 Fixed assets 1,032 768 Accruals and reserves 1,234 1,074 Sec 174 Capitalized R&D 37,888 27,871 Tax credits 26 28 Gross deferred tax assets 122,296 102,745 Less: Valuation allowance ( 119,293 ) ( 99,069 ) Deferred tax assets, net of valuation allowance 3,003 3,676 Deferred tax liabilities: Operating lease right-of-use asset ( 3,003 ) ( 3,676 ) Net deferred tax assets $ — $ — ASC 740 requires that the tax benefit of net operating losses, temporary differences and credit carryforwards be recorded as an asset to the extent that management assesses that realization is “more likely than not.” Realization of the future tax F- 25 Adicet Bio, Inc. Notes to Consolidated Financial Statements benefits is dependent on the Company’s ability to generate sufficient taxable income within the carryforward period. Because of the Company’s recent history of operating losses, management believes that recognition of the deferred tax assets arising from the above-mentioned future tax benefits is currently not likely to be realized and, accordingly, has provided a valuation allowance. The valuation allowance increased by $ 20.2 million and by $ 9.6 million during the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024 , the Company had net operating loss carryforwards of $ 339.7 million, $ 12.6 million, and $ 15.2 million to reduce future taxable income, if any, for federal, state and foreign income tax purposes, respectively. Of the federal net operating loss carryforwards, $ 7.5 million will begin to expire in 2036 if not utilized, and $ 332.4 million can be carried forward indefinitely. The state carryforwards will begin to expire in 2035. The Company also had approximately $ 16.3 million of federal and $ 9.3 million of California research and development tax credit carryforwards available to offset future taxable income as of December 31, 2024. The federal credits begin to expire in 2041 and the California research credits can be carried forward indefinitely. Utilization of the net operating loss carryforwards and research and development tax credit carryforwards may be subject to an annual limitation under Section 382 of the Internal Revenue Code of 1986, and corresponding provisions of state law, due to ownership changes that have occurred previously or that could occur in the future. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50% over a three-year period. If the Company has experienced an ownership change, as defined by Section 382, at any time since inception, utilization of the net operating loss carryforwards or research and development tax credit carryforwards would be subject to an annual limitation. As of December 31, 2024, the ownership change analysis has not been completed. Any previous ownership changes may result in a limitation that will reduce the total amount of net operating loss and tax credit carryforwards disclosed that can be utilized. Subsequent ownership changes may affect the limitation in future years. The Company files income tax returns in the United States federal jurisdiction, California, Massachusetts and Israel. The tax years 2016 to 2024 remains open to United States federal and state examination to the extent of the utilization of net operating loss and credit carryovers. Additionally, the Company is currently undergoing an audit with California’s Franchise Tax Board (FTB) regarding the apportionment of revenue for the tax year 2017 and may be obligated to make future payments to the state related to this tax year, depending on the outcome of the examination. The Company is evaluating the FTB's proposal and assessing its course of action. As of December 31, 2024 , the Company had unrecognized tax benefits of $ 0.8 million related to the transfer of certain intellectual property from its Israeli subsidiary. In addition, as of December 31, 2024 , the Company had unrecognized tax benefits of $ 25.6 million related to the federal and state research and development credits as a result of no formal research credit study performed. A reconciliation of the beginning and ending unrecognized tax benefit amount is as follows (in thousands): Year Ended December 31, 2024 2023 Balance at the beginning of the year $ 18,462 $ 9,759 Adjustment based on tax positions related to prior year — 5 Adjustment based on tax positions related to current year 7,908 8,698 Balance at the end of the year $ 26,370 $ 18,462 The Company recognizes interest expense and penalties related to the above unrecognized tax benefits within income tax expense (benefit). Management determined that no accrual for interest and penalties was required as of December 31, 2024 . 15. Related Party Transactions As of December 31, 2024 , Regeneron owned 883,568 shares of the Company’s common stock. Regeneron became a related party in July 2019 as a result of Series B redeemable convertible preferred stock financing which was subsequently converted into common stock. For the year ended December 31, 2024 , the Company recorded no revenue from the Regeneron Agreement. See Note 9 for a discussion of the Regeneron Agreement. F- 26 Adicet Bio, Inc. Notes to Consolidated Financial Statements 16. Defined Contribution Plan The Company maintains a defined contribution plan under Section 401(k) of the Internal Revenue Code covering substantially all full-time United States employees. Employee contributions are voluntary and are determined on an individual basis subject to the maximum allowable under federal tax regulations. During the years ended December 31, 2024 and 2023, the Company made aggregate matching contributions of $ 1.1 million and $ 1.2 million, respectively. 17. Goodwill During the third quarter of 2023, the Company experienced a significant decline in its stock price. As of September 30, 2023, the Company’s stock price declined 44 % from its closing stock price on June 30, 2023, and the decline in stock price was sustained. The Company determined that this decline in stock price and market capitalization of the Company constituted a substantive change in circumstances that would more likely than not reduce the fair value of the Company’s single reporting unit below its carrying amount. Accordingly, the Company tested its goodwill for impairment as of September 30, 2023 (the Interim Testing Date). In determining the fair value of the Company’s sole reporting unit for the interim impairment analysis as of the Interim Testing Date, the Company used a market-based approach, and the primary input in this approach was a quoted market price in an active market. To determine the estimated fair value of the Company’s single reporting unit, the Company calculated its market capitalization based on its stock price. Based on the Company’s interim impairment analysis as of the Interim Testing Date, the carrying value of the Company’s single reporting unit exceeded its fair value. Accordingly, step two of the goodwill impairment test was performed. In performing step two of the goodwill impairment test, the Company utilized observable inputs and concluded that an impairment charge was necessary for the full amount of goodwill. As a result of the step two evaluation, the Company recorded a goodwill impairment charge of $ 19.5 million during the twelve months ended December 31, 2023. This impairment charge reduced the balance of goodwill to $ 0 on it's consolidated balance sheets as of December 31, 2023 and 2024. 18. Shanghai Adicet Biotechnology Co., Ltd. (the Adicet VIE) In May 2024, the Company initiated research and development activities in China through a series of contractual agreements entered into by and among the Adicet VIE, Adicet Shanghai, and the shareholders of the Adicet VIE. Since the Company determined it was the primary beneficiary of the Adicet VIE, the Adicet VIE was consolidated in the Company’s consolidated financial statements as of December 31, 2024. For the year ended December 31, 2024 , $ 1.2 million of expenses have been incurred by the Adicet VIE, of which $ 1.1 million was recorded as research and development expense and $ 0.1 million as general and administrative expense in the Company’s consolidated statements of operations. The following table summarizes the carrying amount of assets and liabilities of the Adicet VIE as of December 31, 2024, excluding intercompany balances (in thousands): December 31, 2024 Assets Cash and cash equivalents $ 46 Prepaid expenses and other current assets 28 Total current assets 74 Property and equipment, net 4 Total assets $ 78 Liabilities Accrued and other current liabilities 9 Total liabilities $ 9 19. Segment Reporting The Company’s operations are organized and reported as a single reportable segment, which includes all activities related to the discovery, development, and commercialization of allogeneic gamma delta T cell therapies for autoimmune F- 27 Adicet Bio, Inc. Notes to Consolidated Financial Statements diseases and cancer. The Company’s Chief Executive Officer, who is the chief operating decision maker, reviews financial information on an aggregate basis for purposes of allocating resources and evaluating financial performance. This presentation is consistent with how the Company’s CODM, its Chief Executive Officer, assesses the performance of the Company and makes operating decisions on a consolidated basis. The accounting policies of the consolidated segment are the same as those described in the summary of significant accounting policies (refer to Note 2). The CODM assesses performance and decides how to allocate resources based on consolidated net loss that also is reported on the consolidated statements of operations and comprehensive loss as net loss. The CODM uses consolidated net loss to monitor budget versus actual results, assess cash runway, and benchmark against the Company’s competitors. The measure of segment assets is reported on the consolidated balance sheets as total assets. The Company’s assets are primarily held in the United States. The following table sets forth the Company’s segment information (in thousands): Twelve months ended December 31, 2024 2023 External program expenses for product candidates ADI-001 $ 17,756 $ 26,305 ADI-270 4,474 1,010 Other programs (1) 1,191 2,979 Total external program expenses for product candidates 23,421 30,294 Non-program specific expenses (2) 12,085 13,412 Personnel-related expenses (including non-cash stock-based compensation) (3) 62,163 61,169 Depreciation 6,468 6,098 Professional services and consulting fees 7,339 6,042 Facilities and infrastructure expenses 8,560 9,890 Other segment expense (4) 7,579 5,671 Goodwill impairment — 19,462 Interest income ( 10,714 ) ( 9,978 ) Other expense, net 221 598 Income tax provision — — Segment net loss $ ( 117,122 ) $ ( 142,658 ) (1) Relates to programs that have been discontinued or are currently in the research stage. (2) Relates to platform research and development expenses which are not attributed to specific programs. (3) Relates to personnel-related expenses including non-cash stock-based compensation for the years ended December 31, 2024 and 2023 of $ 22.2 million and $ 20.3 million. (4) Relates to other expenses primarily for software subscriptions and licenses, office expenses, travel and entertainment, director compensation and recruiting fees. 20 . Restricted Cash As of December 31, 2024 and December 31, 2023, the Company maintained letters of credit of $ 2.9 million and $ 0.0 million, respectively, which are collateralized with bank accounts at financial institutions in accordance with the agreements. The letters of credit are included within restricted cash on the Company's consolidated balance sheets. Total restricted cash as of December 31, 2024 and 2023 consisted of the following (in thousands): Year Ended December 31, 2024 2023 Redwood City, CA lease (1) $ 2,337 $ — Boston, MA lease 266 — Corporate credit card services 300 — Total $ 2,903 $ — (1) Includes the Company's lease at 1000 Bridge Parkway and 1200 Bridge Parkway. F- 28 Adicet Bio, Inc. EXHIBIT INDEX Exhibit Number Description of Exhibit 3.1 Restated Certificate of Incorporation (as currently in effect) (incorporated by reference to Exhibit 3.3 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on June 7, 2024). 3.2 Amended and Restated Bylaws of the Registrant (as currently in effect) (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on January 30, 2018) . 4.1* Description of Securities. 4.2 Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.3 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 15, 2022). 4.3 Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on January 24, 2024). 10.1 Second Amendment to Lease, dated as of June 16, 2022, between Adicet Therapeutics, Inc. as Tenant, and Westport Office Park, LLC, as Landlord (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on June 21, 2022). 10.2+ Antibody Discovery Agreement, dated as of March 23, 2021, by and between the Registrant and Twist Bioscience Corporation (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-38359) filed with the SEC on November 8, 2022). 10.3+ First Amendment to Antibody Discovery Agreement, dated as of November 8, 2022, by and between the Registrant and Twist Bioscience Corporation (incorporated by reference to Exhibit 10.11 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 15, 2023). 10.4# Second Amended and Restated 2018 Stock Option and Incentive Plan (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on June 5, 2023). 10.5# 2017 Stock Incentive Plan and forms of award agreements thereunder (incorporated by reference to Exhibit 10.1 to the Registrant’s Registration Statement on Form S-1, as amended, (File No. 333-222373) filed with the SEC on January 16, 2018) . 10.6# 2015 Stock Incentive Plan and forms of award agreements thereunder (incorporated by reference to Exhibit 10.13 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on September 16, 2020). 10.7# Amended and Restated 2018 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.14 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 15, 2022). 10.8# Second Amended and Restated 2018 Stock Option and Incentive Plan, as amended (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on June 7, 2024). 10.9# 2022 Inducement Plan and forms of award agreements thereunder (incorporated by reference to Exhibit 10.15 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 15, 2022). 10.10# First Amendment to the 2022 Inducement Plan (incorporated by reference to Exhibit 10.23 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 15, 2023). 10.11#* Second Amendment to the 2022 Inducement Plan. 10.12# Form of Employment Agreement (incorporated by reference to Exhibit 10.16 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 15, 2022). 10.13 Form of Indemnification Agreement between the Registrant and each of its directors and executive officers (incorporated by reference to Exhibit 10.17 to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 15, 2022). 10.14# Amended and Restated Non-Employee Director Compensation Policy (incorporated by reference to Exhibit 10.18 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-38359) filed with the SEC on May 9, 2023). 10.15# Amended and Restated Senior Executive Cash Incentive Bonus Plan (incorporated by reference to Exhibit 10.19 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 15, 2022). F- 29 Adicet Bio, Inc. 10.16 Lease Agreement, dated as of October 31, 2018, by and between Adicet Bio, Inc. as Tenant, and Westport Office Park, LLC as Landlord (incorporated by reference to Exhibit 10.23 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on September 16, 2020). 10.17 First Amendment to Lease, dated as of December 30, 2020, by and between Adicet Therapeutics, Inc. as Tenant, and Westport Office Park, LLC as Landlord (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on January 5, 2021). 10.18 Third Amendment to Lease, dated as of January 9, 2023, by and between Adicet Therapeutics, Inc. as Tenant, and Westport Office Park, LLC as Landlord (incorporated by reference to Exhibit 10.30 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 15, 2023). 10.19 Office Lease Agreement, dated as of January 8, 2018, by and between resTORbio, Inc. and 500 Boylston and 222 Berkeley Owner (DE) LLC (incorporated by reference to Exhibit 10.15 to the Registrant’s Registration Statement on Form S-1, as amended, (File No. 333-222373) filed with the SEC on January 16, 2018). 10.20 First Amendment to Office Lease, dated as of April 1, 2019, by and between resTORbio, Inc. and 500 Boylston and 222 Berkeley Owner (DE) LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-38359) filed with the SEC on May 15, 2019). 10.21 Sublease Agreement, dated as of July 19, 2021, by and between Adicet Bio, Inc. and RFS Opco LLC (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on July 23, 2021). 10.22+ Amended and Restated License Agreement, dated as of May 21, 2014, by and between Technion Research and Development Foundation Ltd., acting on behalf of itself and the Technion-Israel Institute of Technology, and Adicet Therapeutics, Inc. as successor in interest to Applied Immune Technology, Ltd. (incorporated by reference to Exhibit 10.27 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on September 16, 2020). 10.23+ Amendment No. 1 to Amended and Restated License Agreement, dated as of June 30, 2015, by and between Technion Research and Development Foundation Ltd., acting on behalf of itself and the Technion-Israel Institute of Technology, and Applied Immune Technology, Ltd. (incorporated by reference to Exhibit 10.28 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on September 16, 2020). 10.24+ Amendment No. 2 to Amended and Restated License Agreement, dated as of January 13, 2016, by and between Technion Research and Development Foundation Ltd., Applied Immune Technology, Ltd., and Adicet Therapeutics, Inc. (incorporated by reference to Exhibit 10.29 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on September 16, 2020). 10.25+ License and Collaboration Agreement, dated as of July 29, 2016, by and between Adicet Bio, Inc. and Regeneron Pharmaceuticals, Inc. (incorporated by reference to Exhibit 10.30 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on September 16, 2020). 10.26+ Amendment No. 1 to License and Collaboration Agreement, dated as of April 4, 2019, by and between Adicet Bio, Inc. and Regeneron Pharmaceuticals, Inc. (incorporated by reference to Exhibit 10.31 to the Registrant’s Current Report on Form 8-K (File No. 001-38359) filed with the SEC on September 16, 2020). 10.27 Fourth Amendment to Lease, dated as of August 7, 2023, by and between Adicet Therapeutics, Inc. as Tenant, and Westport Office Park, LLC as Landlord (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-38359) filed with the SEC on August 9, 2023). 10.28+ Membership Agreements, dated January 19, 2024 and March 12, 2024, by and between the Registrant and Industrious Bos 131 Dartmouth Street LLC (incorporated by reference to Exhibit 10.39 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 19, 2024). 10.29# Form of Stock Option Cancellation Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-38359) filed with the SEC on November 6, 2024). 19.1 Adicet Bio, Inc. Insider Trading Policy (incorporated by reference to Exhibit 19.1 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 19, 2024). F- 30 Adicet Bio, Inc. 21.1 Subsidiaries of the Registrant (incorporated by reference to Exhibit 21.1 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 12, 2021). 23.1* Consent of KPMG LLP, independent registered public accounting firm. 24.1* Power of Attorney (included on signature page). 31.1* Certification of Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2* Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1** Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 97.1# Adicet Bio, Inc. Compensation Recovery Policy (incorporated by reference to Exhibit 97.1 to the Registrant’s Annual Report on Form 10-K (File No. 001-38359) filed with the SEC on March 19, 2024). 101.INS* Inline XBRL Instance Document 101.SCH* Inline XBRL Taxonomy Extension Schema Document 101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document 104* Cover Page Interactive Data File * Filed herewith. + Portions of this exhibit (indicated by asterisks) have been omitted pursuant to Item 601(b)(10) of Regulation S-K. # Indicates a management contract or any compensatory plan, contract or arrangement. ** The certifications furnished in Exhibit 32.1 hereto are deemed to accompany this Annual Report on Form 10-K and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. Such certifications will not be deemed to be incorporated by reference into any filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Registrant specifically incorporates it by reference. I tem 16. 10-K Summary Not applicable. F- 31 Adicet Bio, Inc. SIGNA TURES Pursuant to the requirements of Section 13 or 15(d) 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. Adicet Bio, Inc. Date: March 6, 2025 By: /s/ Chen Schor Chen Schor President, Chief Executive Officer and Director (Principal Executive Officer) POWER OF ATTORNEY Each person whose individual signature appears below hereby authorizes and appoints Chen Schor and Nick Harvey, and each of them, with full power of substitution and resubstitution and full power to act without the other, as his or her true and lawful attorney-in-fact and agent to act in his or her name, place and stead and to execute in the name and on behalf of each person, individually and in each capacity stated below, and to file any and all amendments to this annual report on Form 10-K and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing, ratifying and confirming all that said attorneys-in-fact and agents or any of them or their or his substitute or substitutes may lawfully do or cause to be done by virtue thereof. Pursuant to the requirements of the Securities Act of 1934, this Annual Report on Form 10-K has been signed by the following persons in the capacities and on the dates indicated. Signature Title Date /s/ Chen Schor Chen Schor President, Chief Executive Officer and Director (principal executive officer) March 6, 2025 /s/ Nick Harvey Nick Harvey Chief Financial Officer (principal financial officer and principal accounting officer) March 6, 2025 /s/ Jeffrey Chodakewitz Jeffrey Chodakewitz, M.D. Director March 6, 2025 /s/ Steve Dubin Steve Dubin Director March 6, 2025 /s/ Carl L. Gordon Carl L. Gordon, Ph.D. Director March 6, 2025 /s/ Aya Jakobovits Aya Jakobovits, Ph.D. Director March 6, 2025 /s/Lloyd Klickstein, M.D., Ph.D. Lloyd Klickstein, M.D., Ph.D. Director March 6, 2025 /s/ Katie Peng Katie Peng Director March 6, 2025 /s/ Andrew Sinclair Andrew Sinclair, Ph.D. Director March 6, 2025 F- 32