AGENUS INC 10-Q

Item 1. Financial Statements AGENUS INC. AND SUBSIDIARIES CONDENSED CONSOLIDA TED BALANCE SHEETS (Amounts in thousands, except share and per share amounts) September 30, 2024 (unaudited) December 31, 2023 ASSETS Cash and cash equivalents $ 44,784 $ 76,110 Accounts receivable 207 25,836 Prepaid expenses 2,352 8,098 Other current assets 2,811 2,372 Total current assets 50,154 112,416 Property, plant and equipment, net of accumulated amortization and depreciation of $ 71,109 and $ 61,943 at September 30, 2024 and December 31, 2023, respectively 124,472 133,421 Operating lease right-of-use assets 28,612 29,606 Goodwill 24,694 24,723 Acquired intangible assets, net of accumulated amortization of $ 18,063 and $ 17,688 at September 30, 2024 and December 31, 2023, respectively 3,955 4,411 Other long-term assets 6,595 9,336 Total assets $ 238,482 $ 313,913 LIABILITIES AND STOCKHOLDERS’ DEFICIT Current portion, long-term debt $ 13,401 $ 146 Current portion, liability related to sale of future royalties and milestones 159,647 132,502 Current portion, deferred revenue 10 18 Current portion, operating lease liabilities 2,427 2,587 Accounts payable 45,899 61,446 Accrued liabilities 36,695 45,283 Other current liabilities 12,565 13,915 Total current liabilities 270,644 255,897 Long-term debt, net of current portion — 12,768 Liability related to sale of future royalties and milestones, net of current portion 182,558 124,556 Deferred revenue, net of current portion 1,143 1,143 Operating lease liabilities, net of current portion 55,164 62,511 Other long-term liabilities 777 5,420 Commitments and contingencies STOCKHOLDERS’ DEFICIT Series A-1 convertible preferred stock; 31,620 shares designated, issued, and outstanding at September 30, 2024 and December 31, 2023; liquidation value of $ 34,047 at September 30, 2024 0 0 Common stock, par value $ 0.01 per share; 800,000,000 shares authorized; 21,685,192 and 19,718,662 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively 217 197 Additional paid-in capital 1,845,815 1,796,095 Accumulated other comprehensive loss ( 1,347 ) ( 955 ) Accumulated deficit ( 2,137,021 ) ( 1,955,668 ) Total stockholders’ deficit attributable to Agenus Inc. ( 292,336 ) ( 160,331 ) Non-controlling interest 20,532 11,949 Total stockholders’ deficit ( 271,804 ) ( 148,382 ) Total liabilities and stockholders’ deficit $ 238,482 $ 313,913 See accompanying notes to unaudited condensed consolidated financial statements. 2 AGENUS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS O F OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) (Amounts in thousands, except per share amounts) Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 Revenue: Research and development $ — $ 3,414 $ 267 $ 8,515 Service revenue 454 540 1,353 2,464 Non-cash royalty revenue related to the sale of future royalties 24,658 20,360 75,006 61,534 Total revenues 25,112 24,314 76,626 72,513 Operating expenses: Cost of service revenue ( 146 ) ( 303 ) ( 368 ) ( 2,851 ) Research and development ( 41,058 ) ( 51,443 ) ( 121,753 ) ( 167,846 ) General and administrative ( 17,275 ) ( 18,909 ) ( 50,947 ) ( 57,562 ) Fair value adjustments 1,863 — 1,863 398 Operating loss ( 31,504 ) ( 46,341 ) ( 94,579 ) ( 155,348 ) Other income (expense): Non-operating income 19 442 6,054 238 Interest expense, net ( 35,729 ) ( 18,633 ) ( 96,940 ) ( 53,745 ) Net loss ( 67,214 ) ( 64,532 ) ( 185,465 ) ( 208,855 ) Dividends on Series A-1 convertible preferred stock ( 54 ) ( 53 ) ( 161 ) ( 160 ) Less: net loss attributable to non-controlling interest ( 828 ) ( 2,331 ) ( 4,112 ) ( 9,384 ) Net loss attributable to Agenus Inc. common stockholders $ ( 66,440 ) $ ( 62,254 ) $ ( 181,514 ) $ ( 199,631 ) Per common share data: Basic and diluted net loss attributable to Agenus Inc. common stockholders $ ( 3.08 ) $ ( 3.29 ) $ ( 8.65 ) $ ( 11.43 ) Weighted average number of Agenus Inc. common shares outstanding: Basic and diluted 21,550 18,908 20,995 17,458 Other comprehensive loss: Foreign currency translation loss $ ( 346 ) $ ( 311 ) $ ( 392 ) $ ( 1,943 ) Other comprehensive loss ( 346 ) ( 311 ) ( 392 ) ( 1,943 ) Comprehensive loss $ ( 66,786 ) $ ( 62,565 ) $ ( 181,906 ) $ ( 201,574 ) See accompanying notes to unaudited condensed consolidated financial statements. 3 AGENUS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT (Unaudited) (Amounts in thousands) Series A-1 Convertible Preferred Stock Common Stock Treasury Stock Number of Shares Par Value Number of Shares Par Value Additional Paid-In Capital Number of Shares Amount Accumulated Other Comprehensive Income (Loss) Non-controlling Interest Accumulated Deficit Total Balance at December 31, 2023 32 $ 0 19,718 $ 197 $ 1,796,095 — $ — $ ( 955 ) $ 11,949 $ ( 1,955,668 ) ( 148,382 ) Net loss — — — — — — — — ( 1,568 ) ( 61,886 ) ( 63,454 ) Other comprehensive loss — — — — — — — ( 116 ) — — ( 116 ) Share-based compensation — — — — 3,477 — — — 719 — 4,196 Shares sold at the market — — 1,249 13 17,158 — — — — — 17,171 Payment of CEO payroll in shares — — 7 — 89 — — — — — 89 Vesting of nonvested shares — — 8 — — — — — — — — Exercise of stock options and employee share purchases — — 12 — 166 — — — 7 — 173 Balance at March 31, 2024 32 $ 0 20,994 $ 210 $ 1,816,985 — $ — $ ( 1,071 ) $ 11,107 $ ( 2,017,554 ) $ ( 190,323 ) Net loss — — — — — — — — ( 1,716 ) ( 53,081 ) ( 54,797 ) Other comprehensive income — — — — — — — 70 — — 70 Share-based compensation — — — — 8,449 — — — 841 — 9,290 Shares sold at the market — — 117 1 1,989 — — — — — 1,990 Issuance of warrants, net of expenses — — — — 6,983 — — — — — 6,983 Vesting of nonvested shares — — 2 — — — — — — — — Payment of CEO payroll in shares — — 11 — 114 — — — — — 114 MiNK private placement stock sale — — — — ( 4,434 ) — — — 10,234 — 5,800 Exercise of stock options — — 2 — 28 — — — 6 — 34 Balance at June 30, 2024 32 $ 0 21,126 $ 211 $ 1,830,114 — $ — $ ( 1,001 ) $ 20,472 $ ( 2,070,635 ) $ ( 220,839 ) Net loss — — — — — — — — ( 828 ) ( 66,386 ) ( 67,214 ) Other comprehensive loss — — — — — — — ( 346 ) — — ( 346 ) Share-based compensation — — — — 8,399 — — — 881 — 9,280 Shares sold at the market — — 503 5 6,771 — — — — — 6,776 Payment of CEO payroll in shares — — 16 — 98 — — — — — 98 Vesting of nonvested shares — — 7 — — — — — — — — Exercise of stock options and employee share purchases — — 33 1 433 — — — 7 — 441 Balance at September 30, 2024 32 $ 0 21,685 $ 217 $ 1,845,815 — $ — $ ( 1,347 ) $ 20,532 $ ( 2,137,021 ) $ ( 271,804 ) See accompanying notes to unaudited condensed consolidated financial statements. 4 AGENUS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT (Unaudited) (Amounts in thousands) Series A-1 Convertible Preferred Stock Common Stock Treasury Stock Number of Shares Par Value Number of Shares Par Value Additional Paid-In Capital Number of Shares Amount Accumulated Other Comprehensive Income (Loss) Non-controlling Interest Accumulated Deficit Total Balance at December 31, 2022 32 $ 0 15,278 $ 153 $ 1,647,561 — $ — $ 915 $ 6,376 $ ( 1,709,907 ) $ ( 54,902 ) Net loss — — — — — — — — ( 2,639 ) ( 68,254 ) ( 70,893 ) Other comprehensive income — — — — — — — 2 — — 2 Share-based compensation — — — — 4,566 — — — 919 — 5,485 Shares sold at the market — — 1,689 17 60,566 — — — — — 60,583 Issuance of director deferred shares — — 13 1 982 — — — — — 983 Issuance of shares for services — — 7 — 318 — — — — — 318 Exercise of stock options and employee share purchases — — 10 — 329 — — — 45 — 374 Issuance of subsidiary shares for employee bonus — — — — — — — — 726 — 726 Issuance of shares for employee bonus — — 136 1 4,224 ( 1 ) ( 2,429 ) — — — 1,796 Retirement of treasury shares — — ( 50 ) ( 1 ) ( 9 ) 1 2,429 — — — 2,419 Balance at March 31, 2023 32 $ 0 17,083 $ 171 $ 1,718,537 — $ — $ 917 $ 5,427 $ ( 1,778,161 ) $ ( 53,109 ) Net loss — — — — — — — — ( 4,414 ) ( 69,016 ) ( 73,430 ) Other comprehensive loss — — — — — — — ( 1,634 ) — — ( 1,634 ) Share-based compensation — — — — 5,154 — — — 888 — 6,042 Shares sold at the market — — 1,227 12 42,235 — — — — — 42,247 MiNK stock dividend — — — — ( 14,888 ) — — — 14,888 — — MiNK stock purchases — — — — 405 — — — ( 640 ) — ( 235 ) Issuance of subsidiary shares for employee bonus — — — — — — — — 285 — 285 Issuance of shares for employee bonus — — 96 1 3,079 — ( 1,642 ) — — — 1,438 Retirement of treasury shares — — ( 33 ) — ( 7 ) — 1,642 — — — 1,635 Balance at June 30, 2023 32 $ 0 18,373 $ 184 $ 1,754,515 — $ — $ ( 717 ) $ 16,434 $ ( 1,847,177 ) $ ( 76,761 ) Net loss — — — — — — — — ( 2,331 ) ( 62,201 ) ( 64,532 ) Other comprehensive loss — — — — — — — ( 311 ) — — ( 311 ) Share-based compensation — — — — 4,601 — — — 935 — 5,536 Shares sold at the market — — 665 7 20,343 — — — — — 20,350 Payment of CEO payroll in shares — — 1 — 32 — — — — — 32 MiNK stock purchases — — — — 893 — — — ( 1,221 ) — ( 328 ) Issuance of shares for services — — 9 — 312 — — — — — 312 Vesting of nonvested shares — — 3 — — — — — — — — Employee share purchases — — 14 — 407 — — — 3 — 410 Balance at September 30, 2023 32 $ 0 19,065 $ 191 $ 1,781,103 — $ — $ ( 1,028 ) $ 13,820 $ ( 1,909,378 ) $ ( 115,292 ) See accompanying notes to unaudited condensed consolidated financial statements . 5 AGENUS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED S TATEMENTS OF CASH FLOWS (Unaudited) (Amounts in thousands, except per share amounts) Nine Months Ended September 30, 2024 2023 Cash flows from operating activities: Net loss $ ( 185,465 ) $ ( 208,855 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 10,083 8,387 Share-based compensation 12,716 17,408 Non-cash royalty revenue ( 75,006 ) ( 61,534 ) Non-cash interest expense 97,459 55,977 Loss on disposal of assets, net 18 49 Gain on lease terminations ( 5,334 ) — Other, net ( 2,638 ) 183 Changes in operating assets and liabilities: Accounts receivable 25,613 1,308 Prepaid expenses 5,751 ( 1,765 ) Accounts payable ( 13,682 ) 915 Deferred revenue ( 7 ) ( 7,269 ) Accrued liabilities and other current liabilities 1,722 12,518 Other operating assets and liabilities ( 893 ) ( 1,122 ) Net cash used in operating activities ( 129,663 ) ( 183,800 ) Cash flows from investing activities: Purchases of plant and equipment ( 503 ) ( 9,731 ) Proceeds from sale of plant and equipment 24 350 Purchase of long-term investment — ( 5,396 ) Proceeds from sale of long-term investment 527 — Purchases of available-for-sale securities — ( 14,647 ) Proceeds from sale of available-for-sale securities — 30,000 Net cash provided by investing activities 48 576 Cash flows from financing activities: Net proceeds from sale of equity 25,937 123,179 Net proceeds from sale of subsidiary shares in private placement 5,800 — Proceeds from Ligand Purchase Agreement, net of expenses 73,851 — Proceeds from employee stock purchases and option exercises 648 807 Purchase of treasury shares to satisfy tax withholdings — ( 4,566 ) Purchase of subsidiary shares — ( 564 ) Payment of finance lease obligation ( 7,766 ) ( 6,305 ) Net cash provided by financing activities 98,470 112,551 Effect of exchange rate changes on cash ( 216 ) ( 696 ) Net decrease in cash, cash equivalents and restricted cash ( 31,361 ) ( 71,369 ) Cash, cash equivalents and restricted cash, beginning of period 79,779 181,343 Cash, cash equivalents and restricted cash, end of period $ 48,418 $ 109,974 Supplemental cash flow information: Cash paid for interest $ 1,737 $ 2,532 Supplemental disclosures - non-cash activities: Issuance of common stock, $ 0.01 par value, in connection with payment for services $ — $ 630 Insurance financing agreement 771 707 Issuance of stock options for payment of certain employee bonuses 9,321 — Issuance of common stock, $ 0.01 par value, for payment of certain employee bonuses — 7,288 Issuance of subsidiary stock options for payment of certain employee bonuses 1,032 — Issuance of subsidiary shares for certain employee bonuses — 1,011 Lease right-of-use assets obtained in exchange for new operating lease liabilities 105 318 Lease right-of-use assets obtained in exchange for new finance lease liabilities 122 4,812 See accompanying notes to unaudited condensed consolidated financial statements. 6 AGENUS INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CO NSOLIDATED FINANCIAL STATEMENTS September 30, 2024 Note A – Business, Liquidity and Basis of Presentation Agenus Inc. (including its subsidiaries, collectively referred to as “Agenus,” the “Company,” “we,” “us,” and “our”) is a leading clinical-stage biotechnology company developing therapies targeting cancer with a robust pipeline of immunological agents. Our mission is to expand patient populations benefiting from cancer immunotherapy through combination approaches, using a broad repertoire of antibody therapeutics, adoptive cell therapies (through our subsidiary MiNK Therapeutics, Inc. (“MiNK”)), and vaccine adjuvants (through our subsidiary SaponiQx, Inc. (“SaponiQx”)). We believe that combination therapies and a deep understanding of each patient’s cancer will significantly expand the patient population benefiting from immuno-oncology (“I-O”) treatments. In addition to our diverse pipeline, we have established fully integrated capabilities encompassing novel target discovery, antibody generation, cell line development, and current good manufacturing practice ("cGMP") manufacturing. We believe these integrated capabilities enable us to develop and, if approved, commercialize novel candidates on accelerated timelines compared to industry standards. Through independent development and strategic partnerships, we leverage our scientific expertise and capabilities to drive innovation in the I-O field. Our I-O portfolio is driven by several platforms and programs, which we plan to utilize individually and in combination: • Multiple antibody discovery platforms, including proprietary display technologies, to identify future antibody candidates. • Antibody candidate programs, including our lead assets, botensilimab (a multifunctional immune cell activator and human Fc-enhanced cytotoxic T-lymphocyte antigen 4 (CTLA-4) blocking antibody, also known as AGEN1181) and balstilimab (a programmed death receptor-1 (PD-1) blocking antibody). • Our saponin-based vaccine adjuvant platform, primarily centered around our STIMULON™ cultured plant cell (“cpc”) QS-21 adjuvant (“STIMULON cpcQS-21”). • A pipeline of novel allogeneic invariant natural killer T cell therapies for treating cancer and other immune-mediated diseases, controlled by MiNK. Our business activities include product research, preclinical and clinical development, intellectual property prosecution, manufacturing, regulatory and clinical affairs, corporate finance and development activities, and support of our collaborations. Our product candidates require successful clinical trials and approvals from regulatory agencies, as well as acceptance in the marketplace. Part of our strategy is to develop and commercialize some of our product candidates by continuing our existing arrangements with academic and corporate collaborators and licensees and by entering into new collaborations. Our cash and cash equivalents at September 30, 2024 were $ 44.8 million, a decrease of $ 31.3 million from December 31, 2023 . Cash and cash equivalents of our subsidiary, MiNK, at June 30, 2024, were $ 9.3 million. MiNK cash can only be accessed by Agenus through a declaration of a dividend by the MiNK Board of Directors or through settlement of intercompany balances. As of September 30, 2024, we had an accumulated deficit of $ 2.1 billion and $ 13.0 million of subordinated notes maturing in February 2025 . Since our founding we have financed our operations principally through income and revenues generated from corporate partnerships, advance royalty sales and proceeds from equity issuances. Based on our current plans and projections, we believe that our cash resources of $ 44.8 million at September 30, 2024, will be sufficient to satisfy our critical liquidity requirements through the end of the year and into 2025. To support operations further, meet our subordinated notes obligation, and to execute on our business plans, we require additional funding. Currently we are in discussions with several entities including biotechnology and pharmaceutical partners, as well as dedicated healthcare funds to provide the funding necessary to support our operations through our planned biologics license application, or marketing authorization, submission for botensilimab/balstilimab. However, because the completion of such transactions is not entirely within our control, in accordance with accounting guidance we are required to disclose that substantial doubt exists about our ability to continue as a going concern for a period of one year after the date of filing of this Quarterly Report on Form 10-Q. The financial statements have been prepared on a basis that assumes Agenus will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business. Management continues to address the Company’s liquidity needs and has continued to adjust spending in order to preserve liquidity. In August 2023, we prioritized and focused our resources to accelerate the development, registration, and commercialization of our lead asset postponing all preclinical and other clinical programs and reducing our workforce by approximately 25 %. Our CEO, Dr. Garo Armen has elected to receive his base salary and any potential bonus payments in stock rather than cash. We continuously evaluate the likelihood of success of our programs. As such, our decisions to continue to fund or eliminate funding of each of our programs are predicated on these determinations, on an ongoing basis. We expect our sources of funding to include payments from 7 current collaborations which include out-licensing and/or partnering opportunities for our portfolio programs and product candidates with multiple parties; additional third-party agreements; asset sales; further royalty monetization; project financing, and/or sales of equity securities. The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete annual consolidated financial statements. In the opinion of our management, the condensed consolidated financial statements include all normal and recurring adjustments considered necessary for a fair presentation of our financial position and operating results. All significant intercompany transactions and accounts have been eliminated in consolidation. Operating results for the nine months ended September 30, 2024, are not necessarily indicative of the results that may be expected for the year ending December 31, 2024. For further information, refer to our consolidated financial statements and footnotes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (“SEC”). The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances. Actual results could differ materially from those estimates. For our foreign subsidiaries, the local currency is the functional currency. Assets and liabilities of our foreign subsidiaries are translated into U.S. dollars using rates in effect at the balance sheet date while revenues and expenses are translated into U.S. dollars using average exchange rates during the period. The cumulative translation adjustment resulting from changes in exchange rates are included in the consolidated balance sheets as a component of accumulated other comprehensive income (loss) in total stockholders’ deficit. On April 4, 2024, we executed a reverse stock split of our issued and outstanding common stock, par value $ 0.01 , at a ratio of 1-for-20 with a record date of April 12, 2024 (the “Reverse Stock Split”). All common share, per share and related information included in the accompanying financial statements and footnote disclosures have been adjusted retroactively, where applicable, to reflect the Reverse Stock Split. See Note L for further details. In the nine months ended September 30, 2024 and 2023, we deconsolidated certain foreign subsidiaries and recognized gains of approximately $ 185,000 and $ 132,000 , respectively, included in "Other income (expense)" on our condensed consolidated statements of operations and comprehensive loss. Note B – Net Loss Per Share Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding (including common shares issuable under our Amended and Restated Directors’ Deferred Compensation Plan, or “DDCP”). Diluted loss per common share is calculated by dividing loss attributable to common stockholders by the weighted average number of common shares outstanding (including common shares issuable under our DDCP) plus the dilutive effect of outstanding instruments such as warrants, stock options, non-vested shares and convertible preferred stock. Because we reported a net loss attributable to common stockholders for all periods presented, diluted loss per common share is the same as basic loss per common share, as the effect of utilizing the fully diluted share count would have reduced the net loss per common share. The following securities (listed on an as-if-converted-to-Common-Stock basis) have been excluded from the computation of diluted weighted average shares outstanding as of September 30, 2024 and 2023, as they would be anti-dilutive (in thousands): Three and Nine Months Ended September 30, 2024 2023 Warrants 965 99 Stock options 3,313 2,202 Non-vested shares 36 35 Series A-1 convertible preferred stock 17 17 8 Note C – Investments Cash equivalents consisted of the following as of September 30, 2024 and December 31, 2023 (in thousands): September 30, 2024 December 31, 2023 Cost Estimated Fair Value Cost Estimated Fair Value Institutional money market funds $ 42,886 $ 42,886 $ 70,485 $ 70,485 Total $ 42,886 $ 42,886 $ 70,485 $ 70,485 As a result of the short-term nature of these investments, there were minimal unrealized holding gains or losses for the three and nine months ended September 30, 2024 and 2023. As of both September 30, 2024 and December 31, 2023, all of the investments listed above were classified as cash equivalents on our condensed consolidated balance sheets. Note D – Goodwill and Acquired Intangible Assets The following table sets forth the changes in the carrying amount of goodwill for the nine months ended September 30, 2024 (in thousands): Balance, December 31, 2023 $ 24,723 Effect of foreign currency ( 29 ) Balance, September 30, 2024 $ 24,694 Acquired intangible assets consisted of the following as of September 30, 2024 and December 31, 2023 (in thousands): As of September 30, 2024 Amortization period (years) Gross carrying amount Accumulated amortization Net carrying amount Intellectual property 7 - 15 years $ 16,841 $ ( 15,438 ) $ 1,403 Trademarks 4 - 4.5 years 1,197 ( 1,197 ) — Other 2 - 7 years 1,923 ( 1,428 ) 495 In-process research and development Indefinite 2,057 — 2,057 Total $ 22,018 $ ( 18,063 ) $ 3,955 As of December 31, 2023 Amortization period (years) Gross carrying amount Accumulated amortization Net carrying amount Intellectual property 7 - 15 years $ 16,841 $ ( 15,184 ) $ 1,657 Trademarks 4 - 4.5 years 1,213 ( 1,185 ) 28 Other 2 - 7 years 1,988 ( 1,319 ) 669 In-process research and development Indefinite 2,057 — 2,057 Total $ 22,099 $ ( 17,688 ) $ 4,411 The weighted average amortization period of our finite-lived intangible assets is 9 years. Amortization expense related to acquired intangibles is estimated at $ 0.1 million for the remainder of 2024, $ 0.5 million for the years ending December 31, 2025 and 2026, $ 0.4 million for the year ending December 31, 2027 and $ 0.3 million for the year ending December 31, 2028. 9 Note E – Debt Debt obligations consisted of the following as of September 30, 2024 and December 31, 2023 (in thousands): Debt instrument Balance at September 30, 2024 Current Portion: Debentures $ 146 2015 Subordinated Notes 12,918 Other 337 Total $ 13,401 Debt instrument Balance at December 31, 2023 Current Portion: Debentures $ 146 Long-term Portion: 2015 Subordinated Notes 12,768 Total $ 12,914 As of September 30, 2024 and December 31, 2023, the principal amount of our outstanding debt balance was $ 13.5 million and $ 13.1 million, respectively. Note F – Liability Related to the Sale of Future Royalties and Milestones The following table shows the activity within the liability account in the nine months ended September 30, 2024 (in thousands): Period from December 31, 2023 to September 30, 2024 Liability related to sale of future royalties and milestones - beginning balance $ 257,296 Proceeds from sale of future royalties and milestones 63,879 Non-cash royalty revenue ( 75,006 ) Non-cash interest expense recognized 97,240 Liability related to sale of future royalties and milestones - ending balance 343,409 Less: unamortized transaction costs ( 1,204 ) Liability related to sale of future royalties and milestones, net $ 342,205 Healthcare Royalty Partners In January 2018, we, through our wholly-owned subsidiary Antigenics, LLC (“Antigenics”), entered into a Royalty Purchase Agreement (the “HCR Royalty Purchase Agreement”) with Healthcare Royalty Partners III, L.P. and certain of its affiliates (collectively, “HCR”). Pursuant to the terms of the HCR Royalty Purchase Agreement, we sold to HCR 100 % of Antigenics’ worldwide rights to receive royalties from GlaxoSmithKline (“GSK”) on sales of GSK’s vaccines containing our STIMULON QS-21 adjuvant. At closing, we received gross proceeds of $ 190.0 million from HCR. Although we sold all of our rights to receive royalties on sales of GSK’s vaccines containing QS-21, as a result of our obligation to HCR, we are required to account for the $ 190.0 million in proceeds from this transaction as a liability on our condensed consolidated balance sheet that will be recognized into revenue in proportion to the royalty payments from GSK to HCR over the estimated life of the HCR Royalty Purchase Agreement. The liability is classified between the current and non-current portion of liability related to sale of future royalties and milestones in the condensed consolidated balance sheets based on the estimated royalty payments to be received by HCR in the next 12 months from the financial statement reporting date. During the nine months ended September 30, 2024 , we recognized $ 75.0 million of non-cash royalty revenue, and we recorded $ 91.0 million of related non-cash interest expense related to the HCR Royalty Purchase Agreement. 10 As royalties are remitted to HCR from GSK, the balance of the recorded liability will be effectively repaid over the life of the HCR Royalty Purchase Agreement. To determine the amortization of the recorded liability, we are required to estimate the total amount of future royalty payments to be received by HCR. The sum of these amounts less the $ 190.0 million proceeds we received will be recorded as interest expense over the life of the HCR Royalty Purchase Agreement. Periodically, we assess the estimated royalty payments to be paid to HCR from GSK, and to the extent the amount or timing of the payments is materially different from our original estimates, we will prospectively adjust the amortization of the liability, and the related recognition of interest expense. During the nine months ended September 30, 2024 , our estimate of the effective annual interest rate over the life of the agreement decreased to 48.9 %, which results in a life of contract interest rate of 26.7 %. Ligand Pharmaceuticals In May 2024, we and certain wholly-owned subsidiaries, entered into a Purchase and Sale Agreement (the "Ligand Purchase Agreement") with Ligand Pharmaceuticals Incorporated ("Ligand"). Pursuant to the terms of the Ligand Purchase Agreement, Ligand will receive (i) 31.875 % of the development, regulatory and commercial milestone payments we were then eligible to receive under our agreements with Bristol-Myers Squibb Company ("BMS"), UroGen Pharma Ltd., Gilead Sciences, Inc. ("Gilead"), Merck Sharpe & Dohme and Incyte Corporation ("Incyte"), (the “Covered License Agreements”) (ii) 18.75 % of the royalties the Company receives under the Covered License Agreements; and (iii) a 2.625 % synthetic royalty on worldwide net sales of botensilimab and balstilimab (collectively the “Purchased Assets”). The total amounts payable to Ligand are subject to a 50 % reduction in the event total payments to Ligand exceed a specified return hurdle. The synthetic royalty is subject to a reduction if annual worldwide net sales exceed a specified level, and a cap on annual worldwide net sales if annual worldwide net sales exceed a higher specified level. The synthetic royalty can increase by 1 % based on the occurrence of certain future events. In consideration for the sale of the Purchased Assets, we received gross proceeds of $ 75.0 million, less $ 0.9 million in reimbursable expenses, on the closing date. In addition, Ligand has a time-based option to invest an additional $ 25.0 million on a pro rata basis ("Purchaser Upsize Option"). In connection with the sale of the Purchased Assets, we issued to Ligand a warrant (the "Ligand Warrant") to purchase 867,052 shares of our common stock, at an exercise price equal to $ 17.30 per share. See Note L - Equity for further detail. The $ 75.0 million in gross proceeds was allocated to the identified components as follows: Liability related to sale of future royalties and milestones $ 63,879 Ligand Warrant 7,098 Purchaser Upsize Option 4,023 Total Ligand Purchase Agreement gross proceeds $ 75,000 As a result of our significant continuing involvement in the generation of the cash flows of the Purchased Assets, we are required to account for $ 63.9 million of the proceeds from this transaction as a liability on our condensed consolidated balance sheet that will be recognized into revenue in proportion to the royalty and milestone payments paid to Ligand over the estimated life of the Ligand Purchase Agreement. The Purchaser Upsize Option is considered a freestanding financial instrument as it is separately exercisable and can be legally transferred from the Ligand Purchase Agreement. As such, it is accounted for as a written option which is accounted for as a liability at fair value and remeasured at each balance sheet date with changes in fair value recorded in earnings. The fair value of the Purchaser Upsize Option at September 30, 2024 was $ 2.2 million. The Ligand Warrant is considered a freestanding financial instrument that as it is separately exercisable and can be legally transferred from the Ligand Purchase Agreement, which was determined to be equity-classified under ASC 815. To allocate the proceeds, the Purchaser Upsize Option liability and equity-classified Ligand Warrants were recognized based on their fair values and the residual was allocated to a liability related to the sale of future royalties and milestones on our condensed consolidated balance sheets. During the nine months ended September 30, 2024, we recorded $ 6.2 million of non-cash interest expense related to the Ligand Purchase Agreement. As royalties are remitted to us and milestone and sales are earned from the Purchased Assets, the balance of the recorded liability will be effectively repaid over the life of the Ligand Purchase Agreement. To determine the amortization of the recorded liability, we are required to estimate the total amount of future payments that Ligand is entitled to under the Ligand Purchase Agreement. The sum of these amounts less the $ 63.9 million proceeds allocated to the liability related to sale of future royalties and milestones will be recorded as interest expense over the life of the Ligand Purchase Agreement. Periodically, we assess the estimated royalty and milestone payments to be received and sales to be earned under the Ligand Purchase Agreement, and to the extent the amount or timing of the payments is materially different from our original estimates, we will prospectively adjust the amortization of 11 the liability, and the related recognition of interest expense. As of September 30, 2024, our estimate of the effective annual interest rate over the life of the agreement was 27.9 %. Note G – Accrued and Other Current Liabilities Accrued liabilities consisted of the following as of September 30, 2024 and December 31, 2023 (in thousands): September 30, 2024 December 31, 2023 Payroll $ 10,501 $ 14,512 Professional fees 5,183 7,101 Contract manufacturing costs 5,558 7,613 Research services 8,162 10,807 Other 7,291 5,250 Total $ 36,695 $ 45,283 Other current liabilities consisted of the following as of September 30, 2024 and December 31, 2023 (in thousands): September 30, 2024 December 31, 2023 Finance lease liabilities $ 7,398 $ 10,457 Purchaser Upsize Option (Note F) 2,161 — Other 3,006 3,458 Total $ 12,565 $ 13,915 The terms of one of our finance lease agreements include a requirement to maintain a specified minimum cash balance. As of September 30, 2024, our cash balance was below this threshold. Despite this, we remain current on all lease payments under the agreement. While the financial institution has the contractual right to take remedial actions, including potentially reclaiming the leased assets, we are actively addressing the situation and expect to regain compliance. As of September 30, 2024, the remaining amounts owed under this lease totaled approximately $ 7.5 million, with payments scheduled through September 2025 . 12 Note H – Fair Value Measurements Assets and liabilities measured at fair value are summarized below (in thousands): Description September 30, 2024 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents (Note C) $ 42,886 $ 42,886 $ — $ — Long-term investments 1,499 1,499 — — Total $ 44,385 $ 44,385 $ — $ — Liabilities: Purchaser Upsize Option (Note F) $ 2,161 $ — $ — $ 2,161 Contingent purchase price considerations 318 — — 318 Total $ 2,479 $ — $ — $ 2,479 Description December 31, 2023 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents (Note C) $ 70,485 $ 70,485 $ — $ — Long-term investments 3,222 3,222 — — Total $ 73,707 $ 73,707 $ — $ — Liabilities: Contingent purchase price consideration $ 318 $ — $ — $ 318 Total $ 318 $ — $ — $ 318 Long-term investments are included in "Other long-term assets" in our condensed consolidated balance sheets. We are required to measure the Purchaser Upsize Option issued under the Ligand Purchase Agreement at fair value. The $ 2.2 million fair value of the Purchaser Upsize Option at September 30, 2024, included in "Other current liabilities" in our condensed consolidated balance sheets, is based on significant inputs not observable in the market, which require it to be reported as a Level 3 liability within the fair value hierarchy. The valuation of this liability is determined based on a scenario analysis and uses assumptions we believe would be made by a market participant. We measure our contingent purchase price considerations at fair value. The fair values of our contingent purchase price considerations at both September 30, 2024 and December 31, 2023, of $ 0.3 million, included in "Other long-term liabilities" in our condensed consolidated balance sheets, are based on significant inputs not observable in the market, which require them to be reported as Level 3 liabilities within the fair value hierarchy. The valuation of these liabilities use assumptions we believe would be made by a market participant and are mainly based on estimates from a Monte Carlo simulation of our share price, as well as other factors impacting the probability of triggering the milestone payments. Share price was evolved using a geometric Brownian motion, calculated daily for the life of the contingent purchase price considerations. The fair value of our outstanding debt balance at September 30, 2024 and December 31, 2023 was $ 13.4 million and $ 13.0 million, respectively, based on the Level 2 valuation hierarchy of the fair value measurements standard using a present value methodology that was derived by evaluating the nature and terms of each note and considering the prevailing economic and market conditions at the balance sheet date. The principal amount of our outstanding debt balance at September 30, 2024 and December 31, 2023 was $ 13.5 million and $ 13.1 million, respectively. Note I – Revenue from Contracts with Customers Gilead Collaboration Agreement On December 20, 2018, we entered into a series of agreements with Gilead Sciences, Inc. (“Gilead”) focused on the development and commercialization of up to five novel immuno-oncology therapies. Pursuant to the terms of the license agreement, the option and license agreements and the stock purchase agreement we entered into with Gilead (collectively, the “Gilead 13 Collaboration Agreements”), at the closing of the transaction on January 23, 2019, we received an upfront cash payment from Gilead of $ 120.0 million and Gilead made a $ 30.0 million equity investment in Agenus. On November 6, 2020, we received notice from Gilead that it was returning AGEN1423 to us and voluntarily terminating the applicable license agreement. The termination was effective as of February 4, 2021. In the third quarter of 2021 we ceased development of AGEN1223 and in October 2021 the AGEN1223 option and license agreement was formally terminated. In August 2024, Gilead elected not to exercise the option to license AGEN2373 and the option and license agreement was formally terminated. Collaboration Revenue No revenue was recognized for the three and nine months ended September 30, 2024. For the three and nine months ended September 30, 2023, we recognized approximately $ 2.9 million and $ 7.2 million, respectively, of research and development revenue based on the partial satisfaction of the over time performance obligations as of quarter end. Disaggregation of Revenue The following table presents revenue (in thousands) for the three and nine months ended September 30, 2024 and 2023, disaggregated by geographic region and revenue type. Revenue by geographic region is allocated based on the domicile of our respective business operations. Three months ended September 30, 2024 United States Rest of World Total Revenue Type Other services $ — $ 454 $ 454 Non-cash royalties 24,658 — 24,658 $ 24,658 $ 454 $ 25,112 Three months ended September 30, 2023 Revenue Type Research and development services $ 447 $ — $ 447 Other services — 540 540 Clinical product revenue 116 — 116 Recognition of deferred revenue 2,851 — 2,851 Non-cash royalties 20,360 — 20,360 $ 23,774 $ 540 $ 24,314 Nine months ended September 30, 2024 United States Rest of World Total Revenue Type Clinical product revenue $ 267 $ — $ 267 Other services — 1,353 1,353 Non-cash royalties 75,006 — 75,006 $ 75,273 $ 1,353 $ 76,626 Nine months ended September 30, 2023 Revenue Type Research and development services $ 1,158 $ — $ 1,158 Other services — 2,464 2,464 Clinical product revenue 116 — 116 Recognition of deferred revenue 7,241 — 7,241 Non-cash royalties 61,534 — 61,534 $ 70,049 $ 2,464 $ 72,513 Contract Balances Contract assets primarily relate to our rights to consideration for work completed in relation to our research and development services performed but not billed at the reporting date. The contract assets are transferred to receivables when the rights become unconditional. Currently, we do not have any contract assets which have not transferred to a receivable. We had no asset impairment charges related to contract assets in the period. Contract liabilities primarily relate to contracts where we received payments but have not yet satisfied the related performance obligations. The advance consideration received from customers for research and 14 development services or licenses bundled with other promises is a contract liability until the underlying performance obligations are transferred to the customer. The following table provides information about contract liabilities from contracts with customers (in thousands): Nine months ended September 30, 2024 Balance at beginning of period Additions Deductions Balance at end of period Contract liabilities: Deferred revenue $ 1,161 $ 6 $ ( 14 ) $ 1,153 During the nine months ended September 30, 2024 , we did not recognize any revenue from amounts included in the contract asset or the contract liability balances from performance obligations satisfied in previous periods. No ne of the costs to obtain or fulfill a contract were capitalized. Note J – Share-based Compensation Plans In June 2024, our stockholders approved an amendment to our Amended and Restated 2019 Equity Incentive Plan (the "2019 EIP") that increased the maximum number of shares of our common stock available for issuance under our 2019 EIP by 3.0 million shares. We primarily use the Black-Scholes option pricing model to value stock options granted to employees and non-employees, including stock options granted to members of our Board of Directors. However, the fair value of stock option market-based awards is calculated based on a Monte Carlo simulation as of the date of issuance. All stock options have 10-year terms and generally vest ratably over a 3 or 4 -year period. A summary of option activity for the nine months ended September 30, 2024 is presented below: Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2023 2,141,360 $ 65.00 Granted 1,370,416 12.81 Exercised ( 16,668 ) 12.26 Forfeited ( 67,929 ) 27.45 Expired ( 113,760 ) 63.61 Outstanding at September 30, 2024 3,313,419 $ 44.26 7.23 $ 111 Vested or expected to vest at September 30, 2024 3,313,419 $ 44.26 7.23 $ 111 Exercisable at September 30, 2024 2,465,909 $ 50.15 6.75 $ — The weighted average grant-date fair values of stock options granted during the nine months ended September 30, 2024 and 2023 were $ 11.45 and $ 28.80 , respectively. During the nine months ended September 30, 2024, all options were granted with exercise prices equal to the market value of the underlying shares of common stock on the grant date other than certain awards dated January 16, 2024 and January 17, 2024. In January 2024, our Board of Directors approved certain awards subject to forfeiture in the event stockholder approval was not obtained for an amendment to our 2019 EIP. This approval was obtained in June 2024. Accordingly, these awards have a grant date of June 2024, with an exercise price as of the date the Board of Director's approved the awards in January 2024. As of September 30, 2024 , there was approximately $ 15.2 million of total unrecognized share-based compensation expense related to these stock options and stock options granted under subsidiary plans which, if all milestones are achieved, will be recognized over a weighted average period of 1.7 years. Certain employees and consultants have been granted non-vested stock. The fair value of non-vested market-based awards is calculated based on a Monte Carlo simulation as of the date of issuance. The fair value of other non-vested stock is calculated based on the closing sale price of our common stock on the date of issuance. 15 A summary of non-vested stock activity for the nine months ended September 30, 2024 is presented below: Non-vested Shares Weighted Average Grant Date Fair Value Outstanding at December 31, 2023 27,163 $ 37.20 Granted 41,452 13.05 Vested ( 17,002 ) 28.15 Forfeited ( 15,500 ) 21.39 Outstanding at September 30, 2024 36,113 $ 20.52 As of September 30, 2024 , there was approximately $ 1.3 million of unrecognized share-based compensation expense related to these non-vested shares and non-vested shares granted under subsidiary plans which will be recognized over a period of 3.2 years. During the nine months ended September 30, 2024 , 30,637 shares were issued under the 2019 Employee Stock Purchase Plan, 17,002 shares were issued as a result of the vesting of non-vested stock and 16,668 shares were issued as a result of stock option exercises. The impact on our results of operations from share-based compensation for the three and nine months ended September 30, 2024 and 2023, was as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 Research and development $ 4,649 $ 1,464 $ 10,685 $ 4,853 General and administrative 4,631 4,072 12,081 12,210 Total share-based compensation expense $ 9,280 $ 5,536 $ 22,766 $ 17,063 Note K – Restricted Cash As of September 30, 2024, and December 31, 2023 , we maintained non-current restricted cash of $ 3.6 million and $ 3.7 million, respectively. This amount is included within “Other long-term assets” in our condensed consolidated balance sheets and is comprised of deposits under letters of credit required under our facility leases. The following table provides a reconciliation of cash, cash equivalents and restricted cash that sums to the total of the same such amounts shown in the condensed consolidated statements of cash flows (in thousands): Nine Months Ended September 30, 2024 Nine Months Ended September 30, 2023 Beginning of Period End of Period Beginning of Period End of Period Cash and cash equivalents $ 76,110 $ 44,784 $ 178,674 $ 106,305 Restricted cash 3,669 3,634 2,669 3,669 Cash, cash equivalents and restricted cash $ 79,779 $ 48,418 $ 181,343 $ 109,974 Note L – Equity On March 14, 2024, we filed a Post-effective Amendment to an Automatic Shelf Registration Statement on Form POSASR (file no. 333-272911) and a Post-Effective Amendments for Registration Statement on Form POS AM (file no. 333-272911) (together, the “Registration Statement”). The Registration Statement included both a base prospectus that covered the potential offering, issuance and sale from time to time of up to $ 300.0 million of common stock, preferred stock, warrants, debt securities and units of Agenus and a prospectus supplement for the potential offer and sale of up to 6,725,642 shares of common stock (the “Initial ATM Shares”) in “at the market” offerings pursuant to an At Market Issuance Sales Agreement by and between Agenus and B. Riley Securities, Inc. (the “Sales Agent”), dated as of July 22, 2020 (the “Sales Agreement”). On August 8, 2024, we filed an additional prospectus supplement for the potential offer and sale of up to an additional 13,834,015 shares of common stock (together with the Initial ATM Shares, the “Placement Shares”) in “at the market” offerings pursuant to the Sales Agreement. Sales pursuant to the Sales Agreement will be made only upon our instruction to the Sales Agent, and we cannot provide assurances that we will issue any additional Placement Shares pursuant to the Sales Agreement. 16 During the three and nine months ended September 30, 2024 , we received net proceeds of approximately $ 6.8 million and $ 25.9 million, from the sale of approximately 0.5 million and 1.9 million shares of our common stock, respectively, in at-the-market offerings under the Sales Agreement. On April 3, 2024, our stockholders approved a proposal to amend our Amended and Restated Certificate of Incorporation, as amended (the “Certificate of Incorporation”), to effect a reverse stock split of our issued and outstanding common stock at a ratio of 1-for-20 (the “Reverse Stock Split”). On April 4, 2024, we filed a Certificate of Eighth Amendment (the “Certificate of Amendment”) to our Certificate of Incorporation with the Secretary of State of the State of Delaware to effect the Reverse Stock Split. Pursuant to the Certificate of Amendment, the Reverse Stock Split became effective at 12:01 a.m., Eastern Time, on April 12, 2024. As of the opening of trading on April 12, 2024, our common stock began trading on a post-split basis under CUSIP number 00847G 804. All common share, per share and related information included in the accompanying financial statements and footnote disclosures have been adjusted retroactively, where applicable, to reflect the Reverse Stock Split. In connection with the Purchase Agreement described in Note F, on May 6, 2024, we issued to Ligand a warrant to purchase 867,052 shares of our common stock, at an exercise price equal to $ 17.30 per share. The exercise price of the Ligand Warrant and the number of shares issuable upon exercise of the Ligand Warrant are subject to adjustments for stock splits, combinations, stock dividends or similar events. The Ligand Warrant is exercisable until May 6, 2029 . Note M – Non-controlling Interest Non-controlling interest recorded in our condensed consolidated financial statements as of September 30, 2024 and December 31, 2023, relates to the following approximate interests in certain consolidated subsidiaries, which we do not own. September 30, 2024 December 31, 2023 MiNK Therapeutics, Inc. 45 % 37 % SaponiQx, Inc. 30 % 30 % Changes in non-controlling interest for the periods ended September 30, 2024 and December 31, 2023, were as follows (in thousands): September 30, 2024 December 31, 2023 Beginning balance $ 11,949 $ 6,376 Net loss attributable to non-controlling interest ( 4,112 ) ( 11,676 ) Other items: Sale of subsidiary shares in private placement 10,234 — Distribution of subsidiary shares to Agenus stockholders — 14,888 Purchase of subsidiary shares — ( 2,546 ) Issuance of subsidiary shares for employee bonus — 1,011 Issuance of subsidiary shares for employee stock purchase plan and exercise of options 20 71 Subsidiary share-based compensation 2,441 3,825 Total other items 12,695 17,249 Ending balance $ 20,532 $ 11,949 Sale of subsidiary shares in private placement On May 13, 2024, MiNK entered into a Stock Purchase Agreement with a certain investor (the “Purchaser”), pursuant to which MiNK issued and sold an aggregate of 4,640,000 shares of its Common Stock (the “MiNK Common Shares”), at a purchase price of $ 1.25 per share. The aggregate purchase price paid by the Purchaser for the MiNK Common Shares was approximately $ 5.8 million, net of offering expenses. The transaction closed on May 14, 2024. Distribution of subsidiary shares to Agenus stockholders 17 On March 29, 2023 , our Board of Directors declared a stock dividend (the "Dividend") consisting of an aggregate of 5.0 million shares (the "Dividend Stock") of common stock, par value $ 0.00001 per share, of MiNK held by Agenus to record holders of Agenus' common stock, par value $ 0.01 per share as of the close of business on April 17, 2023 (the "Record Date"). On May 1, 2023 , we paid the Dividend and distributed 0.292 of a share of the Dividend Stock for each share of Agenus common stock outstanding as of the close of business on the Record Date. No fractional shares were issued in connection with the Dividend and the shareholders of Agenus who were entitled to receive fractional shares of the Dividend Stock received cash (without interest) in lieu of such fractional shares. Subsequent to the distribution of the Dividend Stock, we maintained a controlling voting interest in MiNK. Purchase of subsidiary shares During the year ended December 31, 2023, we purchased 446,494 shares of MiNK common stock in multiple open market transactions. Note N – Related Party Transactions In 2023, our Audit and Finance Committee approved a contract between Avillion Life Sciences LTD ("Avillion") and Agenus for the performance of up to $ 450,000 of clinical consulting services. Allison Jeynes, a former member of our Board of Directors, is chief executive officer of Avillion. No expenses were incurred in the three and nine months ended September 30, 2024. For the nine months ended September 30, 2023, approximately $ 450,000 related to these services is included in “Research and development” expense in our condensed consolidated statements of operations. In June 2024, Dr. Jennifer Buell was appointed to our Board of Directors. Dr. Buell's spouse is a partner in the law firm of Wolf, Greenfield & Sachs, P.C. (“Wolf Greenfield”), which provides us legal services. For the three and nine months ended September 30, 2024, we expensed Wolf Greenfield fees totaling approximately $ 48,000 and $ 147,000 , respectively. Dr. Buell’s spouse does not receive direct compensation from the fees we pay Wolf Greenfield and the fees we paid to Wolf Greenfield in the period were an insignificant amount of Wolf Greenfield’s revenues. Our Audit and Finance Committee approved these services under its related-party transactions policy. Note O – Contingencies In September 2024, a putative securities class action lawsuit was commenced in the U.S. District Court for the District of Massachusetts naming as defendants Agenus and three current officers. The complaint alleges that the defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 thereunder, by making false and misleading statements and omissions of material fact related to the efficacy and commercial prospects of botensilimab and balstilimab. The plaintiff seeks to represent all persons who purchased or otherwise acquired Agenus securities between January 23, 2023, and July 17, 2024. The plaintiff seeks damages and interest, and an award of costs, including attorneys’ fees. We are unable to estimate a range of loss, if any, that could result were there to be an adverse final decision in this action. Note P – Recent Accounting Pronouncements Recently Issued, Not Yet Adopted In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 requires incremental annual and quarterly disclosures about segment measures of profit or loss as well as significant segment expenditures. It also requires public entities with a single reportable segment to provide all segment disclosures required by the amendments and all existing segment disclosures in Topic 280. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. As we have a single reportable segment, we expect the adoption of this standard to result in increased disclosures in the notes to our consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires incremental annual disclosures around income tax rate reconciliations, income taxes paid and other related disclosures. For public business entities, ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted for any annual periods for which financial statements have not been issued or made available for issuance. We are currently evaluating the impact that ASU 2023-09 will have on the notes to our consolidated financial statements. No other new accounting pronouncement issued or effective during the nine months ended September 30, 2024 had or is expected to have a material impact on our consolidated financial statements or disclosures. 18 Note Q – Subsequent Events At the Market Offerings During the period of October 1, 2024 through November 8, 2024, we sold 1,763,025 shares of our common stock under the Sales Agreement, totaling net proceeds of approximately $ 7.1 million. 19