What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2024-03-26 compared with 2023-03-23 · 259 added, 340 removed, 718 unchanged (45% of the section changed)

Market for Registrant’s Common Equ ity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Shares of our common stock began trading on the Nasdaq Global Market on December 16, 2020 under the symbol “BCAB.”

Prior to that time, there was no public market for shares of our common stock.

Shares of our common stock began trading on the Nasdaq Global Market on December 16, 2020 under the symbol “BCAB.” Prior to that time, there was no public market for shares of our common stock.

Holders of Record

As of March 26, 2024, there were 28 stockholders of record of our common stock and 0 stockholders of record of our Class B common stock.

These numbers were derived from our stockholder records and do not include beneficial owners of our common stock whose shares are held in “street”

name with various dealers, clearing agencies, banks, brokers and other fiduciaries.

These numbers were derived from our stockholder records and do not include beneficial owners of our common stock whose shares are held in “street” name with various dealers, clearing agencies, banks, brokers and other fiduciaries.

We have never declared or paid any cash dividends on our capital stock.

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On December 15, 2020, the SEC declared effective our registration statement on Form S-1 (File No.

333-250093), as amended, filed in connection with our Initial Public Offering (or "IPO").

At the closing of the offering on December 18, 2020, we issued and sold 12,075,000 shares of our common stock at the initial public offering price to the public of $18.00 per share, which included the exercise in full of the underwriters’

option to purchase additional shares.

333-250093), as amended, filed in connection with our Initial Public Offering (“IPO”).

We received gross proceeds from the IPO of $217.4 million, before deducting underwriting discounts and commissions of approximately $15.2 million and estimated offering costs of approximately $3.8 million.

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No offering expenses were paid or are payable, directly or indirectly, to our directors or officers, to persons owning 10% or more of any class of our equity securities or to any of our affiliates.

As of December 31, 2022, we have used approximately $115.5 million of the proceeds from our IPO.

As of December 31, 2023, we have used all $198.3 million of the proceeds from our IPO.

There has been no material change in the planned use of such proceeds from that described in the final prospectus filed by us with the SEC on December 17, 2020.

Managemen t’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis together with our consolidated financial statements and related notes included in “Item 8.

Financial Statements and Supplementary Data”

in this Annual Report on Form 10-K.

Managemen t’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis together with our financial statements and related notes included in “Item 8.

Financial Statements and Supplementary Data” in this Annual Report on Form 10-K.

The following discussion contains forward-looking statements that involve risks and uncertainties.

For a complete discussion of forward-looking statements, see the section above entitled “Forward Looking Statements.”

Our actual results could differ materially from those expressed or implied in any forward-looking statements as a result of various factors, including those set forth under the caption “Item 1A.

Risk Factors.”

For a complete discussion of forward-looking statements, see the section above entitled “Forward-Looking Statements.” Our actual results could differ materially from those expressed or implied in any forward-looking statements as a result of various factors, including those set forth under the caption “Item 1A.

Risk Factors.”

We are a clinical-stage biopharmaceutical company developing our novel class of highly specific and selective antibody-based therapeutics for the treatment of solid tumor cancer.

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Unlike healthy tissue, the tumor microenvironment is acidic, and we have designed our antibodies to selectively bind to their targets on tumor cells under acidic pH conditions but not on targets in normal tissues.

Our approach is to identify the necessary targeting and potency required for cancer cell destruction, while aiming to eliminate or greatly reduce on-target, off-tumor toxicity—one of the fundamental challenges of existing cancer therapies.

We are a United States-based company with research facilities in San Diego, California and, through our contractual relationship with BioDuro-Sundia, a provider of preclinical development services, in Beijing, China.

Since the commencement of our operations, we have focused substantially all of our resources on conducting research and development activities, including drug discovery, preclinical studies and clinical trials of our product candidates, including the ongoing Phase 2 clinical trials of mecbotamab vedotin and ozuriftamab vedotin and our Phase 1 clinical trial of BA3071, establishing and maintaining our intellectual property portfolio, manufacturing clinical and research material through third parties, hiring personnel, establishing product development and commercialization collaborations with third parties, raising capital and providing general and administrative support for these operations.

Since the commencement of our operations, we have focused substantially all of our resources on conducting research and development activities, including drug discovery, preclinical studies and clinical trials of our product candidates, including the ongoing Phase 2 clinical trials of mecbotamab vedotin (BA3011), ozuriftamab vedotin (BA3021), and evalstotug (BA3071), and our Phase 1 clinical trial of BA3182 (CAB-EpCAM x CAB-CD3), establishing and maintaining our intellectual property portfolio, manufacturing clinical and research material through third parties, hiring personnel, establishing product development and commercialization collaborations with third parties, raising capital and providing general and administrative support for these operations.

Since 2014, such research and development activities have exclusively related to the research, development, manufacture and Phase 1 and Phase 2 clinical testing of our CAB antibody-based product candidates and the strengthening of our proprietary CAB technology platform and pipeline.

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We do not expect to generate meaningful revenue from product sales for the foreseeable future, and we expect to continue to incur significant operating expenses for the foreseeable future due to the cost of research and development, including identifying and designing product candidates and conducting preclinical studies and clinical trials, and the regulatory approval process for our product candidates.

We expect our expenses, and the potential for losses, to increase as we conduct clinical trials of our lead product candidates and seek to expand our pipeline.

We expect our expenses, and the potential for losses, to be variable as we focus development efforts on our prioritized programs.

Research and development expenses will vary as we continue to advance clinical trials of our lead product candidates, and will decrease once we complete enrollment and treatment of patients in those trials.

We expect our expenses and capital requirements will increase substantially in connection with our ongoing activities as we:

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• advance the clinical development of ozuriftamab vedotin;

• advance the clinical development of evalstotug;

• advance the clinical development of BA3182;

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As a result, we will require substantial additional capital to develop our product candidates and fund operations for the foreseeable future.

Until such time as we can generate significant revenue from product sales, if ever, we expect to finance our operations through a combination of public or private equity offerings, debt financings, collaborations and other similar arrangements.

The amount and timing of our future funding

requirements will depend on many factors, including the pace and results of our development efforts.

Until such time as we can generate significant revenue from product sales, if ever, we expect to finance our operations through a combination of

public or private equity offerings, debt financings, collaborations and other similar arrangements.

The amount and timing of our future funding requirements will depend on many factors, including the pace and results of our development efforts.

We cannot assure you that we will ever be profitable or generate positive cash flow from operating activities.

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As of December 31, 2023, our cash and cash equivalents totaled approximately $111.5 million.

Based on our current operating plan, our current cash and cash equivalents are expected to be sufficient to fund our ongoing operations for a period of at least twelve months from the date the financial statements included in this report are issued.

However, we have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect.

Based on our current operating plan, our current cash and cash equivalents are expected to be sufficient to fund our ongoing operations for a period of at least twelve months from the date of issuance of the financial statements included in this report.

Our current operating plan includes plans to complete enrollment in certain of our clinical trials, delaying development of certain pre-clinical programs, and prioritizing and focusing clinical development on selected assets and indications.

In addition, we have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect.

Impact of COVID-19 on our business

The worldwide COVID-19 pandemic may affect our ability to complete our current preclinical studies and clinical trials, initiate and complete our planned preclinical studies and clinical trials, disrupt regulatory activities or have other adverse effects on our business, results of operations, financial condition and prospects.

In addition, the pandemic has caused substantial disruption in the financial markets and may adversely impact economies worldwide, both of which could adversely affect our business, operations and ability to raise funds to support our operations.

To date, we have experienced modest business disruptions, including with respect to clinical trials we are conducting, and non-material impairments as a result of the pandemic.

Our mecbotamab vedotin Phase 2 sarcoma trial remains on schedule and the Phase 2 interim analysis for mecbotamab vedotin NSCLC and ozuriftamab vedotin studies have experienced some modest delays.

In April 2020, we borrowed $0.7 million under the Paycheck Protection Program under the CARES Act and we received full loan forgiveness from the U.S.

Small Business Association in July 2021, resulting in the recognition of $0.7 million to other income for the twelve months ended December 31, 2021.

We are continuing to monitor the potential impact of the pandemic, but we cannot be certain what the overall impact will be on our business, financial condition, results of operations and prospects.

The COVID-19 pandemic previously impacted our ongoing operations, including clinical trials.

The extent to which the COVID-19 pandemic may continue to impact our business, financial condition and results of operations cannot be reasonably estimated and will depend on future developments, which are highly uncertain and cannot be predicted, including the severity and duration of any resurgence of COVID-19 and its variants and the actions necessary to contain any resurgence or treat its impact, among others.

We will continue to monitor the COVID-19 situation closely and operate in accordance with all relevant health and safety guidelines as they evolve in response to changing public health conditions.

Financial operations overview

To date, we have not generated any revenue from the sale of products and do not expect to generate meaningful revenue in the near future.

In 2019 we entered into a collaboration agreement with BeiGene, Ltd.

The agreement was amended several times and was terminated in November 2021, which resulted in the Company assuming responsibility for development of BA3071.

We received a total of $25.0 million in non-refundable payments from BeiGene from this collaboration.

Pursuant to the terms of the November 2021 amendment, we agreed to pay single digit royalties to BeiGene and agreed to share on a limited basis in any upfront and milestone payments, if received, through a sublicense of BA3071.

In addition, we may in the future seek third-party collaborators or joint venture partners for development and commercialization of additional CAB product candidates.

The Company has entered into collaborations and licensing agreements with various third parties that, in some cases, may provide for potential future milestone and royalty payments to us (see Note 7 to our financial statements).

Prior to developing our own programs, we received revenue from services performed under fixed price service contracts that, in some cases, provided for potential milestone and royalty payments to us.

We recognized $0 and $0.3 million in revenues from our legacy service contracts for the years ended December 31, 2022 and 2021, respectively.

We did not recognize any revenues from collaborations, licenses, or our legacy service contracts during the years ended December 31, 2023 and 2022, respectively.

Operating expenses

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The capitalized amounts are then expensed as the related goods are delivered and services are performed.

We expect our research and development expenses to generally increase for the foreseeable future as we continue to invest in research and development activities to advance our product candidates and our clinical programs and expand our product candidate pipeline.

The process of conducting the necessary preclinical and clinical research to obtain regulatory approval is costly and time-consuming.

We expect our research and development expenses to remain variable from quarter to quarter as we continue to advance our clinical programs, then decreasing after we complete enrollment and treatment in certain of our clinical trials, and focus development on selected high potential indications.

The process of conducting the necessary preclinical and clinical research to obtain regulatory approval is costly and

time-consuming.

Successful product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials.

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Personnel-related expenses consist of salaries, benefits and equity-based compensation.

We also expect our general and administrative expenses to increase in the future as we increase our personnel headcount to support our research and development activities to advance our product candidates and clinical stage programs.

We expect our general and administrative expenses to remain flat to moderately increasing in the future to support development of our prioritized CAB programs.

Interest income

Interest income consists primarily of interest earned on our cash and cash equivalent balances.

Our interest income has not been significant to date and we do not expect any material changes.

Interest expense

Interest expense consists primarily of interest incurred on our previously outstanding debt.

We no longer have interest expense after the forgiveness of our PPP loan in July 2021.

Extinguishment of debt

In July 2021, our PPP loan was fully forgiven and we recorded a gain on extinguishment equal to the principal and interest outstanding at the time of forgiveness.

Other income (expense)

Other income (expense) primarily includes miscellaneous items of income and expense that were not significant for the periods presented.

Results of operations

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(in thousands)

Collaboration and other revenue

Operating expenses:

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Loss from operations

Other income (expense):

Other income:

Interest income

Interest expense

Gain (loss) on extinguishment of long-term debt

Other income (expense)

Total other income (expense)

Consolidated net loss and comprehensive loss

Collaboration and other revenue

We did not recognize any revenue for the year ended December 31, 2022.

Collaboration and other revenue for the year ended December 31, 2021 consisted of $0.3 million recognized under our legacy service contracts.

As part of the November 2021 amendment to the agreement with BeiGene, we reclassified the remaining $19.8 million of deferred revenue as a long-term liability which we expect to settle as licensing payments are made to BeiGene in accordance with the resulting amendment.

In the event the license is terminated, the liability will be extinguished with no further payment to BeiGene.

Total other income

Net loss and comprehensive loss

Research and development expense

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External expenses:

BA3011 (AXL-ADC)

BA3021 (ROR2-ADC)

BA3071 (CTLA-4)

Mecbotamab vedotin, BA3011 (CAB AXL-ADC)

Ozuriftamab vedotin, BA3021 (CAB ROR2-ADC)

Evalstotug, BA3071 (CAB CTLA-4)

BA3182 (CAB EpCAM x CAB CD3)

Other CAB Programs

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Research and development expenses were $103.7 million and $79.3 million for the years ended December 31, 2023 and 2022, respectively.

The increase of $21.0 million was primarily driven by a $17.2 million increase in clinical development for our clinical-stage programs, a $3.8 million increase in personnel related costs due to an increase in headcount to support ongoing development activities for our programs, a $0.7 million increase in stock-based compensation due to awards issued in connection with our 2020 Equity Incentive Plan, and a $0.4 million increase in facility and other allocated costs, offset by a $1.1 million decrease in pre-clinical and manufacturing costs for various programs.

The increase of approximately $24.4 million was primarily driven by an $11.2 million increase for our Phase 2 clinical-stage ADC programs which are being developed in multiple indications, a $7.4 million increase in our CTLA4 immuno-oncology program which progressed to Phase 2 development during 2023, a $4.8 million increase for various pre-clinical programs primarily our CAB B7-H3 x CD3 bispecific program and our next generation CAB Nectin-4 ADC program which we are advancing to IND, a $1.8 million increase in personnel related costs due to an increase in headcount to support ongoing development activities for our clinical programs, and a $1.2 million increase in facility and other

allocated costs, offset by a decrease of $2.1 million related to our EpCAM bispecific program which completed manufacturing in 2022 and received an IND in February 2023.

General and administrative expense

General and administrative expenses were $26.0 million and $28.8 million for the years ended December 31, 2023 and 2022, respectively.

The decrease of $9.6 million was primarily driven by an $11.3 million decrease in stock-based compensation related to awards issued under our 2020 Equity Incentive Plan, including new awards granted under the plan and the modification of awards issued to one of our co-founders in 2021, offset by an increase of $1.4 million in accounting and legal services, including a $1.0 million legal settlement, and a $0.3 million increase in travel related expenses.

The decrease of $2.8 million was primarily driven by a decrease of $1.1 million decrease in insurance due to a decrease in premiums for our D&O policy, a $1.1 million decrease in stock-based compensation related to awards issued under our 2020 Equity Incentive Plan, and a $0.7 million decrease in accounting, legal services and consulting primarily related to a $1.0 million legal settlement in 2022.

Interest income

Interest income was $1.6 million and $350,000 for the years ended December 31, 2022 and 2021, respectively.

Interest income was $6.3 million and $1.6 million for the years ended December 31, 2023 and 2022, respectively.

The increase of $4.7 million was due to higher yields earned as compared to the same period in 2022.

Extinguishment of Debt

Extinguishment of debt was $0 and $0.7 million for the twelve months ended December 31, 2022 and 2021, respectively.

The $0.7 million gain on extinguishment during the twelve months ended December 31, 2021 was related to the forgiveness of our PPP loan in July 2021.

Liquidity and capital resources

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Since July 2020, we have funded our operations primarily through the issuance of equity.

In November 2022, we received net proceeds of $61.7 million in an underwritten public offering of our common stock.

As of December 31, 2023, we had cash and cash equivalents of $111.5 million.

On April 22, 2020, we received proceeds from a loan pursuant to the Paycheck Protection Program of the CARES Act, "the PPP Loan", in the amount of $0.7 million from City National Bank, as lender.

In July 2021, we were notified by our lender that our PPP Loan had been fully forgiven by the U.S.

Small Business Administration and that there was no remaining balance on the PPP Loan.

We recorded the forgiveness as other income in July

In January 2023, the Company entered into an Open Market Sale Agreement (the “Sales Agreement”) with Jefferies LLC (“Jefferies”) acting as sales agent pursuant to which the Company may, from time to time at its sole discretion, sell shares of the Company’s common stock, with aggregate gross sales proceeds of up to $100.0 million.

The Company will pay Jefferies a commission of 3.0% of the aggregate gross proceeds the Company receives from all sales of the Company’s common stock under the Sales Agreement.

We have not sold any shares of our common stock under the Sales Agreement as of December 31, 2023.

Future funding requirements

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However, we have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect.

In addition, we will require additional funding in order to complete development of our product candidates and commercialize our products, if approved.

In addition, we have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect.

We will require additional funding in order to complete development of our product candidates and commercialize our products, if approved.

We may seek to raise any necessary additional capital through a combination of public or private equity offerings, debt financings, collaborations, strategic alliances, licensing arrangements and other marketing and distribution arrangements.

We cannot assure you that, in the event we require additional financing, such financing will be available at acceptable terms to us, if at all.

Failure to generate sufficient cash flows from operations, raise additional capital, and reduce discretionary spending should additional capital not become available could have a material adverse effect on our ability to achieve our intended business objectives.

Failure to generate sufficient cash flows from operations, raise additional capital, and reduce discretionary spending should additional capital not become available could have a material

adverse effect on our ability to achieve our intended business objectives.

Because of the numerous risks and uncertainties associated with the development and commercialization of our product candidates, we are unable to estimate the amounts of increased capital outlays and operating expenditures associated with our current and anticipated preclinical studies and clinical trials.

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Our ability to raise additional funds will depend on financial, economic and other factors, many of which are beyond our control.

For example, market volatility resulting from a variety of causes, including the COVID-19 pandemic, supply chain disruptions, and geopolitical disruptions, including the ongoing conflict between Russia and Ukraine, could adversely impact our ability to access capital as and when needed.

For example, market volatility resulting from a variety of causes, including supply chain disruptions, and geopolitical disruptions, including the recent conflict between Russia and Ukraine and the conflict between Israel and Hamas, could adversely impact our ability to access capital as and when needed.

We may choose to raise additional capital through the issuance of equity or convertible debt securities due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans.

To the extent we issue additional shares of common stock or other equity or convertible debt securities in the future, there will be further dilution to our investors and the terms of these securities may include liquidation or other preferences that adversely affect our stockholders’

If we raise additional capital through debt financing, we may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, acquiring other businesses, products or technology, or declaring dividends.

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Financing activities

Net increase (decrease) in cash and cash equivalents

Net decrease in cash and cash equivalents

Cash used in operating activities

Net cash used in operating activities for the year ended December 31, 2022 was $90.4 million, which consisted of a consolidated net loss of $106.5 million, a net increase of $0.3 million in our net operating assets and liabilities and $15.8 million of non-cash transactions.

Net cash used in operating activities for the year ended December 31, 2023 was $104.0 million, which consisted of a net loss of $123.5 million, a net change of $4.7 million in our net operating assets and liabilities and $14.8 million of non-cash transactions.

The net change in our operating assets and liabilities was primarily due to an increase in accounts payable and accrued expenses of $5.3 million, partially offset by a decrease in operating lease right-of-use assets and liabilities of $0.6 million.

The non-cash transactions primarily consisted of $13.5 million of stock-based compensation and non-cash charges of $1.2 million related to depreciation and amortization.

Net cash used in operating activities for the year ended December 31, 2022 was $90.4 million, which consisted of a net loss of $106.5 million, a net increase of $0.3 million in our net operating assets and liabilities and $15.8 million of non-cash transactions.

The net change in our operating assets and liabilities was primarily due to an increase in prepaid expenses and other assets of $2.6 million, partially offset by an increase in accounts payable and accrued expenses of $3.4 million and a net decrease in operating lease right-of-use assets and liabilities of $0.5 million.

The non-cash transactions primarily consisted of $14.6 million of stock-based compensation and non-cash charges of $1.2 million related to depreciation and amortization.

Net cash used in operating activities for the year ended December 31, 2021 was $62.2 million, which consisted of a consolidated net loss of $95.4 million, a net increase of $7.4 million in our net operating assets and liabilities and $25.8 million of non-cash transactions.

The net change in our operating assets and liabilities was primarily due to an increase in accounts payable and accrued expenses of $8.0 million, a decrease in prepaid expenses and other assets of $0.2 million, offset by a net increase in operating lease right-of-use assets and liabilities of $0.3 million in conjunction with the adoption of ASC 842.

The non-cash transactions primarily consisted of $25.1 million of stock-based compensation and non-cash charges of $1.3 million related to depreciation and amortization, offset by the $0.7 million gain on the extinguishment of our PPP loan.

Cash used in investing activities

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Cash provided by financing activities

Net cash provided by financing activities was $77,000 for the year ended December 31, 2023, which consisted primarily of the net proceeds from the issuance of common stock under our Employee Stock Purchase Plan of $336,000, partially offset by payment of taxes related to the net settlement of equity awards of $259,000.

Net cash provided by financing activities was $61.2 million for the year ended December 31, 2022, which consisted primarily of the $61.7 million net proceeds from the issuance of common stock through an underwritten offering in November 2022 and $0.3 million proceeds from the issuance of common stock under our Employee Stock Purchase Plan, partially offset by payment of taxes related to the net settlement of equity awards of $0.8 million.

Net cash provided by financing activities was $69.5 million for the year ended December 31, 2021, which consisted primarily of the net proceeds from the issuance of common stock through a private placement of $71.0 million, the proceeds from the issuance of common stock under our Employee Stock Purchase Plan of $0.3 million, and $0.1 million due to the exercise of stock options under our Equity Incentive Plan, partially offset by our payment of initial public offering costs of $1.9 million.

Critical accounting policies and estimates

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with U.S.

The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported revenue generated, and reported expenses incurred during the reporting periods.

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with U.S.

The preparation of these financial statements requires us to make estimates and assumptions

that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported revenue generated, and reported expenses incurred during the reporting periods.

Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions and conditions.

While our significant accounting policies are described in the Note 1 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K, we believe that the following critical accounting policies are most important to understanding and evaluating our reported financial results.

While our significant accounting policies are described in the Note 1 to our financial statements included elsewhere in this Annual Report on Form 10-K, we believe that the following critical accounting policies are most important to understanding and evaluating our reported financial results.

Accrued expenses

As part of the process of preparing our consolidated financial statements, we accrue expenses as of each balance sheet date.

As part of the process of preparing our financial statements, we accrue expenses as of each balance sheet date.

This process involves reviewing open contracts and purchase orders, communicating with our personnel to identify services that have been performed on our behalf and estimating the level of service performed and the associated cost incurred for the service when we have not yet been invoiced or otherwise notified of the actual cost.

We make estimates of our accrued expenses as of each balance sheet date based on facts and circumstances known to us at that time.

The estimates in our accrued research and development expenses include the costs incurred for services performed by

our vendors in connection with research and development activities for which we have not yet been invoiced.

The estimates in our accrued research and development expenses include the costs incurred for services performed by our vendors in connection with research and development activities for which we have not yet been invoiced.

We periodically confirm the accuracy of our estimates with the service providers and make adjustments if necessary.

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BioAtla, Inc.

Index to consolidated financial statements

Index to financial statements

Report of independent registered public accounting firm (PCAOB ID:

Consolidated balance sheets

Consolidated statements of operations and comprehensive loss

Consolidated statements of stockholders’

Consolidated statements of cash flows

Notes to consolidated financial statements

Balance sheets

Statements of operations and comprehensive loss

Statements of stockholders’ equity

Statements of cash flows

Notes to financial statements

Report of Indepe ndent Registered Public Accounting Firm

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Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of BioAtla, Inc.

(the Company) as of December 31, 2022 and 2021, the related consolidated statements of operations and comprehensive loss, and stockholders’

equity and cash flows for each of the two years in the period ended December 31, 2022, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2022, in conformity with U.S.

We have audited the accompanying balance sheets of BioAtla, Inc.

(the Company) as of December 31, 2023 and 2022, the related statements of operations and comprehensive loss, stockholders’ equity and cash flows for each of the two years in the period ended December 31, 2023, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2023, in conformity with U.S.

generally accepted accounting principles.

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These financial statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on the Company’s 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.

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(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

The communication of the critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Accrual of Clinical Trial Expenses

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During 2023, the Company incurred $103.7 million for research and development expenses and as of December 31, 2023 accrued $12.5 million for clinical trial costs.

A substantial portion of the Company’s ongoing research and development activities are conducted by third-party service providers, including clinical research organizations (“CROs”).

External costs to be paid to CROs are accrued and expensed based upon actual work completed in accordance with signed agreements.

Auditing management’s accounting for accrued clinical trial costs is especially challenging because the evaluation is dependent upon a high-volume of data and input exchanged between clinical personnel and third-party service providers, such as the total trial management costs, number of sites activated, the number of patients enrolled, and the number of patient visits, which is tracked in spreadsheets and other end user computing programs.

How We Addressed the Matter in Our Audit

To test the completeness of the Company’s accrued clinical trial expenses, we obtained from third-parties confirmation of the number of patients enrolled and costs billed but unpaid as of year-end for significant clinical trials.

We obtained an understanding of the status of significant clinical trial activities from accounting personnel and the clinical project managers.

To assess the appropriate measurement of accrued clinical trial expenses, we inspected key terms, timelines of completion, activities and costs for a sample of vendor contracts, including amendments, and compared these to management’s analyses used in tracking the progress of service agreements.

We also tested a sample of subsequent payments by agreeing the amount of the payment to the invoice and to the amount accrued.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2016.

San Diego, California

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BioAtla, Inc.

Consolidate d balance sheets

B alance Sheets

(in thousands, except share amounts)

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Operating lease right-of-use-asset, net

Liabilities and Stockholders’

Liabilities and Stockholders’ Equity

Current liabilities:

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Total stockholders' equity

Total liabilities and stockholders’

Total liabilities and stockholders’ equity

See accompanying notes.

BioAtla, Inc.

Consolidated st atements of operations and comprehensive loss

St atements of operations and comprehensive loss

(in thousands, except share and per share amounts)

Years ended December 31,

Collaboration and other revenue

Operating expenses:

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Loss from operations

Other income (expense):

Other income:

Interest income

Interest expense

Gain on extinguishment of long-term debt

Other income (expense)

Total other income (expense)

Consolidated net loss and comprehensive loss

Total other income

Net loss and comprehensive loss

Net loss per common share, basic and diluted

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BioAtla, Inc.

Consolidated statements of stockholders’

Statements of stockholders’ equity

(in thousands, except share amounts)

stockholders’

Balance at December 31, 2021

Issuance of common stock, net of $ 3,318 of issuance costs

Issuance of common stock under equity incentive plans

Issuance of common stock upon exercise of options, net

Issuance of common stock under equity incentive plans, net of shares withheld for taxes

Issuance of common stock for Employee Stock Purchase Plan

Taxes related to net share settlement of equity awards

Conversion of Class B Common Stock

Stock-based compensation expense

Balance at December 31, 2022

Issuance of common stock, net of $ 3,318 of issuance costs

Issuance of common stock under equity incentive plans

Issuance of common stock under equity incentive plans, net of shares withheld for taxes

Issuance of common stock for Employee Stock Purchase Plan

Issuance of common stock for director compensation

Taxes related to net share settlement of equity awards

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BioAtla, Inc.

Consolidated sta tements of cash flows

Sta tements of cash flows

(in thousands)

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Loss on disposal of property and equipment

Gain on extinguishment of debt

Stock-based compensation

Accrued interest

Changes in operating assets and liabilities:

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Cash flows from financing activities

Payment of initial public offering costs

Proceeds from issuance of common stock, net of issuance costs

Proceeds from exercise of stock options

Proceeds from issuance of common stock under Employee Stock Purchase Plan

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Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

Net decrease in cash and cash equivalents

Cash and cash equivalents, beginning of period

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BioAtla, Inc.

Notes to consol idated financial statements

Notes to financial statements

Organization and summary of significant accounting policies

BioAtla, LLC was formed in Delaware in March 2007 and was converted to a Delaware corporation in July 2020 and renamed BioAtla, Inc.

(the “Company”).

The Company has a proprietary platform for creating biologics, including its conditionally active biologics (“CAB”

or “CABs”).

(the “Company”).

The Company has a proprietary platform for creating biologics, including its conditionally active biologics (“CAB” or “CABs”).

CABs have been designed to be active only under certain conditions found in diseased tissue, while remaining inactive in normal tissue.

The Company is currently in clinical development of its two lead CAB antibody drug conjugates (“CAB ADC”) targeting AXL and ROR2 receptors, and its CAB immune-oncology antibody targeting CTLA-4.

The Company is currently in clinical development of its two lead CAB antibody drug conjugates (“CAB ADC”) targeting AXL and ROR2 receptors, its CAB immune-oncology antibody targeting CTLA-4, and its CAB bispecific antibody targeting EpCAM.

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

BioAtla, Inc.

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If the Company is not able to secure adequate additional funding, the Company may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, or suspend or curtail planned programs.

Any of these actions could materially harm the Company’s business, results of operations and future prospects.

Management is required to perform a two-step analysis of the Company’s ability to continue as a going concern.

Management must first evaluate whether there are conditions and events that raise substantial doubt about the Company’s ability to continue as a going concern (Step 1).

Any of these actions could materially harm the Company’s business, results of operations and future prospects.

In January 2023, the Company entered into an Open Market Sale Agreement (the “Sales Agreement”) with Jefferies LLC pursuant to which the Company may, from time to time at its sole discretion, sell shares of the Company’s common stock, with aggregate gross sales proceeds of up to $ 100.0 million.

The Company has not sold any shares of its common stock under the Sales Agreement as of December 31, 2023.

Management is required to perform a two-step analysis of the Company’s ability to continue as a going concern.

Management must first evaluate whether there are conditions and events that raise substantial doubt about the Company’s ability to continue as a going concern (Step 1).

If management concludes that substantial doubt is raised, management is also required to consider whether its plans alleviate that doubt (Step 2).

Management’s assessment included the preparation of cash flow forecasts resulting in management’s conclusion that there is not substantial doubt about the Company’s ability to continue as a going concern for 12 months after the date the consolidated financial statements for the year ended December 31, 2022 are issued.

Variable Interest Entities

Management’s assessment included the preparation of cash flow forecasts resulting in management’s conclusion that there is not substantial doubt about the Company’s ability to continue as a going concern as its current cash and cash equivalents will be sufficient to fund the Company’s operations for a period of at least one year from the issuance date of these financial statements.

Variable Interest Entities (“VIE”)

The Company consolidates entities in which it has a controlling financial interest.

The Company determines whether it has a controlling financial interest in an entity by first evaluating whether the entity is a voting interest entity or a variable interest entity (“VIE”).

The Company determines whether it has a controlling financial interest in an entity by first evaluating whether the entity is a voting interest entity or a VIE.

VIEs are entities in which (i) the total equity investment at risk is sufficient to enable the entity to finance its activities independently, (ii) the equity holders have the power to direct the activities of the entity that most significantly impact its economic performance, the obligation to absorb the losses of the entity and the right to receive the residual returns of the entity and (iii) the legal entity is structured with substantive voting rights.

A VIE is an entity that lacks one or more of the characteristics of a voting interest entity.

The Company has a controlling financial interest in a VIE when the Company has a variable interest or interests that provide it with (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE.

The Company evaluates its relationships with its VIEs on an ongoing basis to determine whether or not it has a controlling financial interest (see Note 8).

Use of Estimates

The Company’s consolidated financial statements are prepared in accordance with U.S.

generally accepted accounting principles (“GAAP”).

The preparation of the Company’s consolidated financial statements requires it to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes.

The most significant estimates in the Company’s consolidated financial statements relate to revenue recognition, accruals for research and development costs, equity-based compensation and fair value measurements.

The Company’s financial statements are prepared in accordance with U.S.

The preparation of the Company’s financial statements requires it to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in the Company’s financial statements and accompanying notes.

The most significant estimates in the Company’s financial statements relate to accruals for research and development costs, equity-based compensation and fair value measurements.

These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenue and expenses that are not readily apparent from other sources.

Actual results may differ materially and adversely from these estimates.

To the extent there are material differences between the estimates and actual results, the Company’s future results of operations will be affected.

Segment Reporting

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Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents.

The Company considers all highly liquid investments with original maturities of 90 days or less at the date of purchase to be cash equivalents.

Cash equivalents consist of highly rated securities including U.S.

Government and U.S.

Treasury money market funds, which are unrestricted as to withdrawal or use.

The cash and cash equivalents balance as of December 31, 2023 and 2022 includes $ 50.4 million and $ 0 , respectively, invested in U.S.

Government and U.S.

Treasury money market funds.

Concentrations of Risk

Financial instruments that potentially subject the Company to a significant concentration of credit risk consist primarily of cash and cash equivalents.

The Company maintains deposits in federally insured financial institutions in excess of federally insured limits.

The Company maintains deposits in federally insured financial institutions in excess of federally insured limits and may invest cash that is not required for immediate operating needs in highly liquid instruments that bear minimal risk.

The Company has not experienced any losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held.

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Operating lease liabilities are recognized at the present value of the future lease payments at the lease commencement date.

The Company’s leases do not provide an implicit interest rate and therefore the Company estimates its incremental borrowing rate to discount lease payments.

The incremental borrowing rate reflects the interest rate that the Company would have to pay to borrow on a collateralized basis an amount equal to the lease payments in a similar economic environment over a similar term.

Operating lease right-of-use (“ROU”) assets are based on the corresponding lease liability adjusted for any lease payments made at or before commencement, initial direct costs, and lease incentives.

Renewals or early terminations are not accounted for unless the Company is reasonably certain to exercise these options.

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The Company has a single lease agreement with lease and non-lease components, which are accounted for as a single lease component.

Lease payments for short-term leases, defined as leases with a term of twelve months or less, are expensed on a straight-line basis over the lease term.

Payments for short-term leases, defined as leases with a term of twelve months or less, are expensed on a straight-line basis over the lease term.

The Company does not currently have any short-term leases.

Operating leases are included in operating lease right-of-use assets, operating lease liabilities, and operating lease liabilities, non-current on the Company’s consolidated balance sheets.

Operating leases are included in operating lease right-of-use assets, operating lease liabilities, and operating lease liabilities, non-current on the Company’s balance sheets.

The Company does not have any finance leases.

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The Company considers the terms of a contract and all relevant facts and circumstances when applying the revenue recognition standard.

A customer is a party that has entered into a contract with the Company, where the purpose of the contract is to obtain a product or a service that is an output of the Company’s ordinary activities in exchange for consideration.

To be considered a contract, (i) the contract must be approved (in writing, orally, or in accordance with other customary business practices), (ii) each party’s rights regarding the product or the service to be transferred can be identified, (iii) the payment terms for the product or the service to be transferred can be identified, (iv) the contract must have commercial substance (that is, the risk, timing or amount of future cash flows is expected to change as a result of the contract), and (v) it is probable that the Company will collect substantially all of the consideration to which it is entitled to receive in exchange for the transfer of the product or the service.

A performance obligation is defined as a promise to transfer a product or a service to a customer.

The Company identifies each promise to transfer a product or a service (or a bundle of products or services, or a series of products and services that are substantially the same and have the

same pattern of transfer) that is distinct.

A product or a service is distinct if both (i) the customer can benefit from the product or the service either on its own or together with other resources that are readily available to the customer and (ii) the Company’s promise to transfer the product or the service to the customer is separately identifiable from other promises in the contract.

The Company identifies each promise to transfer a product or a service (or a bundle of products or services, or a series of products and services that are substantially the same and have the same pattern of transfer) that is distinct.

Each distinct promise to transfer a product or a service is a unit of accounting for revenue recognition.

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Research and Development Expenses

The Company’s activities have largely consisted of research and development efforts related to developing our CAB programs.

Research and development expenses consist of expenses incurred in performing research and development activities including salaries and benefits, facilities and other overhead expenses, clinical trials, contract services and other outside expenses.

Research and development expenses are charged to expense as incurred.

Payments for these activities are based on the terms of the individual agreements, which may differ from the pattern of costs incurred, and are reflected in the accompanying consolidated balance sheets as prepaid or accrued expenses.

Payments for these activities are based on the terms of the individual agreements, which may differ from the pattern of costs incurred, and are reflected in the accompanying balance sheets as prepaid or accrued expenses.

When evaluating the adequacy of the accrued expenses, the Company analyzes progress of the services, including the phase or completion of events, invoices received and contracted costs.

Significant judgments and estimates may be made in determining the accrued balances at the end of any reporting period.

Actual results could differ from the Company’s estimates.

As of December 31, 2023, the Company has accrued $ 12.5 million related to clinical trial costs.

The Company has entered into contracts related to its clinical trials with clinical research organizations.

The Company reviews and accrues clinical trial costs based on work performed, which relies on estimates of total trial management costs, sites activated, patients enrolled, and number of patient visits.

The Company reviews and accrues clinical trial costs based on work performed, which relies on estimates and assumptions of total trial management costs, sites activated, patients enrolled, and number of patient visits.

The Company follows this method since reasonably dependable estimates of the costs applicable to clinical trials can be made.

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Revisions are charged to expense in the period in which the facts that give rise to the revision become known.

Historically, revisions have not resulted in material changes to research and development expense;

however, a modification in the protocol of a clinical trial or cancellation of a trial could result in a change to the Company's results of operations.

A modification in the protocol of a clinical trial or cancellation of a trial could result in a material change to the Company's results of operations.

Costs related to filing and pursuing patent applications are recorded as general and administrative expenses and expensed as incurred since recoverability of such expenditures is uncertain.

Stock-Based Compensation

Stock-based compensation expense represents the grant date fair value of equity awards, consisting of stock options, restricted stock units (“RSUs”) and employee stock purchase plan rights, over the requisite service period of the awards (usually the vesting period) on a straight-line basis.

The Company estimates the fair value of stock option grants and employee stock purchase plan rights using the Black-Scholes option pricing model.

Prior to the Company’s IPO, the fair value of RSUs was based on the estimated fair value of the underlying common stock on the date of grant and, subsequent to the Company’s IPO, the fair value is based on the closing sales price of the Company’s common stock on the date of grant.

Equity award forfeitures are recognized as they occur.

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements.

Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

The effect of a change in tax rates on deferred tax

assets and liabilities is recognized as income in the period that includes the enactment date.

Under this method, deferred tax

assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

The effect of a change in tax rates on deferred tax assets and liabilities is recognized as income in the period that includes the enactment date.

The Company recognizes net deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized.

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Comprehensive loss is defined as a change in equity during a period from transactions and other events and circumstances from non-owner sources.

There have been no items qualifying as other comprehensive loss and, therefore, for all periods presented, the Company’s comprehensive loss was the same as its reported net loss.

Net Loss Per Share

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Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common shares and dilutive common stock equivalents outstanding for the period determined using the treasury-stock method.

Dilutive common stock equivalents are comprised of RSUs, common stock options outstanding under the Company’s stock option plan, and contingently issuable shares under the Company's ESPP plan.

Potentially dilutive securities not included in the calculation of diluted net loss per share because to do so would be anti-dilutive are as follows (in common stock equivalents):

Common stock warrants

Dilutive common stock equivalents are comprised of RSUs, common stock options outstanding under the Company’s stock option plan, and contingently issuable shares under the BioAtla, Inc.

Employee Stock Purchase Plan (the “ESPP”).

Potentially dilutive securities not included in the calculation of diluted net loss per common share because to do so would be anti-dilutive are as follows (in common stock equivalents):

Common stock options

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Recent Accounting Pronouncements

There were no recently issued or effective FASB Accounting Standards Updates (ASUs) that had, or are expected to have, a material effect on the Company's results of operations, financial condition, or liquidity.

In December 2023, the FASB issued ASU No.

2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures”.

ASU 2023-09 requires disaggregated information about a reporting entity's effective tax rate reconciliation as well as information on income taxes paid.

ASU 2023-09 is effective for public entities with annual periods beginning after December 15, 2024, with early adoption permitted.

The Company is currently evaluating the impact of this guidance on its financial statements.

Balance sheet details

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Fair value measurements

The carrying amounts of the Company’s current financial assets and current financial liabilities are considered to be representative of their respective fair values because of the short-term nature of those instruments.

As of December 31, 2023 and December 31, 2022 , the Company had no financial assets or liabilities measured at fair value on a recurring basis.

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Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

None of the Company’s non-financial assets and liabilities are recorded at fair value on a non-recurring basis.

As of December 31, 2023 and 2022, the Company had $ 50.4 million and $ 0 , respectively, invested in U.S.

Government and U.S.

Treasury money market funds which are recorded as cash equivalents and represent a Level 1 measurement within the fair value hierarchy.

None of the Company’s non-financial assets and liabilities are recorded at fair value on a non-recurring basis.

No transfers between levels have occurred during the periods presented.

The Company did no t have any outstanding debt as of December 31, 2022 or December 31, 2021 .

In April 2020, the Company borrowed $ 0.7 million under the Paycheck Protection Program (“PPP”) under the CARES Act.

The loan was subsequently forgiven in July 2021.

The $ 0.7 million balance of the forgiven loan was recognized as other income on the Company's Statement of Operations and Comprehensive Loss for the twelve months ended December 31, 2021 .

The Company has a single operating lease for its corporate headquarters and laboratory space in San Diego, California.

The lease expires in July 2025 and the Company has an option to extend the term of the lease for an additional five years .

However, it is not reasonably certain the Company will exercise the option to renew when the lease term ends and thus, the incremental term was excluded from the calculation of the lease liability.

Additionally, the lease includes certain rent abatement, rent escalations, tenant improvement allowances and additional charges for common area maintenance and other costs.

The components of lease expense included in the Company’s consolidated statements of operations include (in thousands):

The components of lease expense included in the Company’s statements of operations and loss include (in thousands):

Years ended December 31,

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The Company did not have any short-term leases or finance leases for the year ended December 31, 2023.

The weighted average remaining lease term and weighted average discount rate for operating leases as of December 31, 2022 were as follows:

Years ended December 31,

The weighted average remaining lease term and weighted average discount rate for operating leases were as follows:

Weighted average remaining lease term (in years)

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From time to time, the Company may be subject to various claims and suits arising in the ordinary course of business.

The Company is not currently a party to any legal proceedings the outcome of which the Company believes, if determined adversely to the Company, would individually or in the aggregate have a material adverse effect on the Company’s business, operating results or financial condition.

Stockholders’

Stockholders’ equity

Description of securities of Delaware corporation

The Company is authorized to issue 200,000,000 shares of preferred stock, par value $ 0.0001 per share, 350,000,000 shares of common stock, par value $ 0.0001 per share, and 15,368,569 shares of Class B common stock, par value $ 0.0001 per share.

Subject to preferences that may be applicable to any outstanding shares of preferred stock, holders of the Company’s common stock and Class B common stock are entitled to receive dividends only if declared from time to time by the Company’s board of directors out of assets which are legally available.

Liquidation preferences

Upon any liquidation, dissolution or winding-up of the Company, holders of the Company’s common stock and Class B common stock are entitled to share ratably in all assets remaining after payment of all liabilities and the liquidation preferences of any of our outstanding shares of preferred stock.

Holders of the Company’s common stock have no conversion rights, while holders of the Company’s Class B common stock shall have the right to convert each share of Class B common stock into one share of common stock at such holder’s election, provided that as a result of such conversion, such holder would not beneficially own in excess of 4.99% of any class of the Company’s securities registered under the Securities Exchange Act of 1934 , as amended, unless otherwise as expressly provided for in the Company’s amended and restated certificate of incorporation.

This ownership limitation may be increased or decreased to any other percentage designated by such holder of Class B common stock upon 61 days’

notice to the Company.

This ownership limitation may be increased or decreased to any other percentage designated by such holder of Class B common stock upon 61 days’ notice to the Company.

Voting rights

Except as otherwise expressly provided in the Company’s amended and restated certificate of incorporation or as required by applicable law, on any matter that is submitted to a vote by the Company’s stockholders, holders of the Company’s common stock are entitled to one vote per share of common stock, and holders of the Company’s Class B common stock are not entitled to any votes per share of Class B common stock, including for the election of directors.

September 2021 Private Placement of Common Stock

In September 2021, the Company entered into agreements to sell 2,678,600 shares of its common stock at a price of $ 28.00 per share through a private investment in public equity financing (or "Private Placement").

Proceeds from the Private Placement, net of underwriting discounts and commissions and other offering costs, were $ 71.0 million.

In connection with the Private Placement, the Company also issued registration rights to the investors.

The Company filed a registration statement on Form S-1 (File No.

333-260440) with the SEC registering for resale the shares of common stock issued in the Private Placement.

November 2022 Underwritten Offering

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The Company issued the warrants described below in 2016 in connection with certain advisory services.

The warrants became exercisable upon our IPO for a period of 365 and 450 days .

The warrants became exercisable upon the Company's IPO for a period of 365 and 450 days .

Upon adoption of ASU No.

2018-07 on October 1, 2020, the measurement date of the warrants became fixed in accordance with the guidance, and such fair value was nominal since the warrants were deeply out-of-the-money.

In December 2021, a total of 566,586 warrants with an exercise period of 365 days after our IPO expired unexercised.

In December 2021, a total of 566,586 warrants with an exercise period of 365 days after the Company's IPO expired unexercised.

The remaining 151,088 warrants with an exercise period of 450 days after the Company's IPO expired unexercised in March 2022.

Accordingly, there are no remaining common stock warrants outstanding and exercisable at December 31, 2022.

Accordingly, there are no remaining common stock warrants outstanding and exercisable at December 31, 2022 or December 31, 2023.

Open market sale agreement

In January 2023, BioAtla, Inc.

(the “Company”) entered into an open market sale agreement under which the Company may offer and sell, from time to time in its sole discretion, shares of the Company’s common stock, par value $ 0.0001 per share, with aggregate gross sales proceeds of up to $ 100,000,000 through an “at the market” equity offering program under which Jefferies LLC will act as sales agent.

No shares have been sold under the agreement to date.

2020 Equity Incentive Plan

On October 29, 2020, the Company’s board of directors approved the adoption of the BioAtla, Inc.

2020 Equity Incentive Plan (the “2020 Plan”) and approved certain amendments to the 2020 Plan in December 2020.

The Company’s stockholders approved the 2020 Plan, as amended, in December 2020.

Under the 2020 Plan, the Company may grant awards of common stock to the Company’s employees, consultants and non-employee directors pursuant to option awards, stock appreciation rights awards, restricted stock awards, restricted stock unit awards, performance stock awards, performance stock unit awards and other stock-based awards.

On October 29, 2020, the Company’s board of directors approved the adoption of the BioAtla, Inc.

2020 Equity Incentive Plan (the “2020 Plan”) and approved certain amendments to the 2020 Plan in December 2020.

The Company’s stockholders approved the 2020 Plan, as amended, in December 2020.

As of December 31, 2023 and 2022 , the total number of common shares authorized for issuance under the 2020 Plan was 9,196,970 and 7,658,509 , respectively.

On January 1st of each year, commencing with the first January 1st following the effective date of the 2020 Plan, the shares authorized for issuance under the 2020 Plan shall be increased by a number of shares equal to the lesser of 4 % of the total number of shares outstanding on the immediately preceding December 31st and such lesser number of shares determined by the Company’s board of directors.

The maximum term of the options granted under the 2020 Plan is no more than ten years .

Awards under the 2020 Plan generally vest at 25 % one year from the vesting commencement date and ratably each month thereafter for a period of 36 months, subject to continuous service.

Stock-based compensation expense recognized for all equity awards under the 2020 Plan has been reported in the consolidated statements of operations and comprehensive loss as follows (in thousands):

On February 26, 2023, the Compensation Committee of the Company’s board of directors approved a modification to the Company’s 2020 Plan to allow vesting of RSUs or stock options, as applicable, subject to the grantee’s continued service to the Company and/or one of its subsidiaries as an employee, non-employee director, or independent contractor.

Unvested RSUs totaling 139,730 shares and 574,244 unvested options which would have been forfeited under the original terms of the 2020 Plan will now continue to vest.

The Company applied modification accounting to these awards which resulted in a decrease in fair value to these awards.

The Company calculated compensation cost for the modified unvested awards of $ 416,000 related to the RSUs and $ 962,000 related to the options, and will recognize these amounts over the remaining requisite service periods.

The modification also resulted in an increase to the term of 130,699 fully vested options for which $ 123,000 of incremental compensation cost was immediately recognized on the date of the modification.

Stock-based compensation expense recognized for all equity awards under the 2020 Plan has been reported in the statements of operations and comprehensive loss as follows (in thousands):

Years ended December 31,

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Restricted stock units

In December 2022, the Company’s board of directors approved an amendment to the Director Compensation Policy, which allows each director to elect to receive their quarterly director fees in the form of restricted stock in lieu of cash.

Two board members elected to receive shares of restricted stock in lieu of cash.

For the twelve months ended December 31, 2023 , the Company issued 45,290 shares of fully vested restricted stock to the two board members.

Compensation expense was earned and recognized for these fully vested restricted stock grants in the amount of $ 0.1 million for the twelve months ended December 31, 2023.

The following table summarizes RSU activity under the 2020 Plan for the years ended December 31, 2023 and 2022:

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The weighted- average grant date fair value of stock options granted during the years ended December 31, 2023 and 2022 was $ 2.61 per share and $ 4.06 per share, respectively.

The total fair value of options vested during the years ended December 31, 2022 and 2021 was $ 6.9 million and $ 1.9 million, respectively.

The total fair

value of options vested during the years ended December 31, 2023 and 2022 was $ 6.7 million and $ 6.9 million, respectively.

Upon option exercise, the Company issues new shares of its common stock.

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Expected volatility.

As the Company’s common stock does not have a significant trading history, the expected volatility assumption is based on volatilities of a peer group of similar companies whose share prices are publicly available.

The peer group was developed based on companies in the biotechnology industry.

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The Company bases the risk-free interest rate assumption on the U.S.

Treasury’s rates for U.S.

Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued.

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Employee Stock Purchase Plan

In December 2020, the Company’s board of directors and stockholders approved the BioAtla, Inc.

Employee Stock Purchase Plan (the “ESPP”).

In December 2020, the Company’s board of directors and stockholders approved the BioAtla, Inc.

Employee Stock Purchase Plan (the “ESPP”).

The ESPP permits participants to purchase common stock through payroll deductions of up to 15 % of their eligible compensation.

As of December 31, 2023 and 2022 , a total of 1,737,098 and 1,229,148 shares, respectively, of common stock were authorized for issuance under the ESPP.

The number of shares of common stock authorized for issuance will automatically increase on January 1 of each calendar year, from January 1, 2021 through January 1, 2030 by the least of (i) 1.0 % of the total number of common shares of our common stock outstanding on December 31 of the preceding calendar year (calculated on a fully diluted basis), (ii) 929,658 common shares or (iii) a number determined by the Company’s board of directors that is less than (i) and (ii) .

The ESPP plan was amended in September 2021 to change the offering periods to end on May 15th and November 15th of each year beginning January 1, 2022.

In February 2021, employees began to enroll in the ESPP, and the Company’s first offering period commenced.

During the years ended December 31, 2023 and 2022 , the Company issued 165,550 and 147,564 shares of common stock under the ESPP, respectively.

As of December 31, 2023 , 1,412,802 shares of common stock remained available for issuance under the ESPP.

Stock-based compensation expense related to the ESPP for the twelve months ended December 31, 2022 and 2021 was $ 0.2 million and $ 0.1 million, respectively.

Stock-based compensation expense related to the ESPP for the twelve months ended December 31, 2023 and 2022 was $ 0.2 million, respectively.

Common stock reserved for future issuance

Common stock reserved for future issuance are as follows in common equivalent shares:

Warrants for the purchase of common stock

Common stock options and restricted stock units issued and outstanding

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Global Co-Development and Collaboration Agreement with BeiGene

In April 2019, the Company entered into a Global Co-Development and Collaboration agreement (the “BeiGene Collaboration”) with BeiGene, Ltd.

and BeiGene Switzerland GmbH (collectively “BeiGene”), for the development, manufacturing and commercialization of the Company’s investigational CAB CTLA-4 antibody (BA3071).

In April 2019, the Company entered into a Global Co-Development and Collaboration agreement (the “BeiGene Collaboration”) with BeiGene, Ltd.

and BeiGene Switzerland GmbH (collectively “BeiGene”), for the development, manufacturing and commercialization of the Company’s investigational CAB CTLA-4 antibody (evalstotug, BA3071).

The BeiGene Collaboration was amended several times between 2019 and 2021 and the Company received a total of $ 25.0 million in non-refundable payments from BeiGene during that time.

In November 2021, the BeiGene Collaboration was terminated, subject to survival of certain provisions, and BeiGene handed back rights to know-how and materials received under the amended BeiGene Collaboration.

As a result, the Company is responsible for the global development and commercialization of BA3071.

As consideration for this amendment, the Company agreed to pay BeiGene mid-single digit royalties on sales worldwide and on a limited basis will share in any upfront and milestone payments received through a sublicense of BA3071.

The Company reclassified its then remaining $ 19.8 million of deferred revenue as a long-term liability which is expected to settle as licensing payments are made to BeiGene in accordance with the resulting amendment.

As a result, the Company is responsible for the global development and commercialization of evalstotug.

Company reclassified its then remaining $ 19.8 million of deferred revenue as a long-term liability which is expected to settle as licensing payments are made to BeiGene in accordance with the resulting amendment.

In the event the license is terminated, the liability will be extinguished with no further payment to BeiGene.

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Collaboration and Supply Agreement with Bristol-Myers Squib

On January 5, 2022, BioAtla and Bristol-Myers Squibb Company (“BMS”) entered into a clinical trial collaboration and supply agreement (the “BMS Agreement”).

Under the terms of the BMS Agreement, BioAtla and BMS will collaborate on clinical trials of separate combination

therapies using two of BioAtla’s Conditionally Active Biologic Antibody Drug Conjugates, BA3011 and BA3021, each in combination with Opdivo® (nivolumab), BMS’

proprietary anti-PD-1 monoclonal antibody product.

In January 2022, the Company and Bristol-Myers Squibb Company (“BMS”) entered into a clinical trial collaboration and supply agreement (the “BMS Agreement”).

Under the terms of the BMS Agreement, BioAtla and BMS will collaborate on clinical trials of separate combination therapies using two of BioAtla’s Conditionally Active Biologic Antibody Drug Conjugates, mecbotamab vedotin (BA3011) and ozuriftamab vedotin (BA3021), each in combination with Opdivo® (nivolumab), BMS’ proprietary anti-PD-1 monoclonal antibody product.

The Company will serve as the study sponsor of the scheduled studies and will be responsible for costs associated with the trial execution.

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After the completion of the combination therapy trials, the Company is obligated to provide BMS with a final report of the data resulting from the trial.

The BMS Agreement was amended in October 2022 to include additional territories for our BA3011 and BA3021 combination study trials.

The BMS Agreement was amended in October 2022 to include additional territories for our mecbotamab vedotin and ozuriftamab vedotin combination study trials.

There was no impact to the Company's financial results for the years ended December 31, 2023 or 2022 as a result of this agreement.

Exclusive License Agreement with Exuma Biotech Corp

Under an Exclusive License Agreement entered into in May 2016, the Company granted EXUMA and its affiliates an exclusive, worldwide, sublicensable license under certain patents and know-how controlled by the Company to develop, manufacture and commercialize Adoptive Cellular Therapy (“ACT”) preparations and treatments for cancer.

EXUMA’s rights under the agreement exclude the right to grant sublicenses to third parties to discover, develop or manufacture any CAB ACT or any component of the Company’s CAB ACT technology, except as used in or incorporated into EXUMA’s ACTs for cancer.

The license to EXUMA is royalty bearing.

EXUMA granted the Company an exclusive, worldwide, royalty free, fully paid-up, sublicensable license under certain patents and know-how controlled by EXUMA and EXUMA’s interest in technology jointly developed under the agreement to develop, manufacture and commercialize non-ACT CAB products for any indication.

EXUMA is obligated to pay the Company during the royalty term, on a product-by-product basis and country-by-country basis, mid-single digit royalties based on annual net sales of certain EXUMA ACT products, subject to certain adjustments.

The term during which EXUMA is obligated to pay royalties under the agreement with respect to any particular product in any particular country, will begin on the first commercial sale of such product in such country and will end on the date of expiration of the last-to-expire of certain product-related patent rights in such country.

All royalties to be paid under the agreement are subject to certain adjustments.

Future royalties will be recognized when earned.

Unless earlier terminated, the agreement continues in effect so long as EXUMA or any of its affiliates, licensees or sublicensees are developing or commercializing any EXUMA products in the ACT field or the Company or any of its affiliates, licensees or sublicensees are developing or commercializing any CAB products for any indication outside the ACT field.

The agreement may be terminated only by the mutual written agreement of the parties.

In November 2019, the Company entered into an Amended and Restated Exclusive License Agreement with EXUMA (the “Amended and Restated EXUMA License”).

The Amended and Restated EXUMA License limits CAB ACT products to four specified targets.

EXUMA is a VIE, and the Company has a variable interest in EXUMA due to its right to receive royalties during the royalty term under the Amended and Restated EXUMA License.

The Company has no equity ownership in EXUMA, no representation on the EXUMA board of directors, and the Amended and Restated EXUMA License does not provide the Company with the ability to make decisions regarding the execution of business strategy that most significantly impact the economic performance of EXUMA.

The Company has not funded and has no commitment to fund EXUMA’s losses, and has no exposure to loss as a result of its Amended and Restated EXUMA License.

As of December 31, 2022 and 2021, the Company has determined it is not the primary beneficiary of EXUMA and, as such, the Company does not consolidate EXUMA.

The Company’s financial statements do not include any assets or liabilities related to the Amended and Restated EXUMA License at December 31, 2022 and 2021.

Service Contracts

Prior to developing its own programs, the Company entered into various fixed price research services contracts.

In connection with these service contracts, the Company may receive future milestone payments if certain clinical, regulatory and commercialization milestones are achieved.

The Company is also eligible to receive royalties based on certain product sales.

The Company recognized revenue of $ 0.3 million for the year ended December 31, 2021, related to the achievement of a clinical milestone on a fixed price service contract.

Related party transactions

Jay Short and Carolyn Anderson Short

On March 23, 2021, the Company entered into a transition agreement with Ms.

Anderson Short, our Co-founder and Executive Vice President and Chief of Intellectual Property and Strategy at that time.

Pursuant to this transition agreement, Ms.

Anderson Short continued in her role with the same base salary and employee benefits until her employment with the Company was terminated on May 31, 2021.

Upon her separation from the Company and subject to her execution of a release of claims, Ms.

Anderson Short received the following severance benefits as set forth in the transition agreement, which satisfied existing severance obligations owing to her under a legacy pre-IPO severance agreement she had entered into with the Company on July 1, 2018:

(i) a lump sum payment equal to 18 months of Ms.

Anderson Short’s then-current base salary, (ii) a payment at her targeted bonus rate for 2021, pro-rated to the date of her termination of employment, and (iii) full accelerated vesting of her equity awards including 7,747 stock options and 138,461 restricted stock units.

The modification of these equity awards resulted in an incremental fair value of $ 7.0 million which was recognized on a straight-line basis over the transition service period which ended on the separation date.

For the year ended December 31, 2021, the Company recognized $ 1.0 million related to the lump sum salary payment and target bonus.

The Company also recognized non-cash stock-based compensation charges of $ 9.4 million related to the modified equity awards for the year ended December 31, 2021.

No unrecognized stock-based compensation related to the transition agreement was recognized for the year ended December 31, 2022.

Inversagen, LLC

On March 15, 2019, the Company entered into an Exclusive License Agreement with Inversagen (the “Inversagen License”).

Under the terms of the agreement, Inversagen acquired the rights to CAB-antibodies for the field of diseases associated with aging, outside of cancer, and an immuno-oncology antibody.

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Commencing on the first commercial sale of the CAB-antibodies and immuno-oncology antibody subject to the Inversagen License, Inversagen will pay the Company milestone payments and royalties, which represent a variable interest held by the Company.

On July 7, 2020, the Company and Inversagen entered into the First Amendment to Exclusive License Agreement (“Amended Inversagen License”), which grants the Company an option for a period of 10 years to acquire the immuno-oncology antibody in return for royalty payments in the low-single digits during the applicable royalty term.

No payments have been made to date.

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The Company does not consolidate Inversagen as it is not the primary beneficiary;

Inversagen License and the Amended Inversagen License did not and do not provide the Company with any decision-making power over the activities that are most significant to the entity’s economic success, such as the direction of its development efforts or the search for or terms of any future financing arrangements.

the Inversagen License and the Amended Inversagen License did not and do not provide the Company with any decision-making power over the activities that are most significant to the entity’s economic success, such as the direction of its development efforts or the search for or terms of any future financing arrangements.

The Company has no equity interest in Inversagen, and no exposure to its losses.

The Company has not provided any services to Inversagen, has not provided any support to Inversagen and has no obligation to do so, and Inversagen’s creditors have no recourse to the general credit of the Company.

The Company does no t have any assets or liabilities associated with its variable interest in Inversagen at December 31, 2023 and 2022.

Inversagen is a related party of the Company.

Jay Short and his spouse, Carolyn Anderson Short, serve as managers of Inversagen.

Jay Short and his spouse serve as managers of Inversagen.

BioAtla Holdings, LLC

Effective January 1, 2020, the Company entered into an Exclusive License Agreement (the “BioAtla Holdings License”) with BioAtla Holdings, LLC.

Under the terms of the agreement, BioAtla Holdings acquired the rights to CAB antibodies for certain targets in the field of Adoptive Cell Therapy (CAR-T format) in exchange for potential royalty payments on future net sales.

On July 7, 2020, the Company and BioAtla Holdings entered into the First Amendment to Exclusive License Agreement (the “Amended BioAtla Holdings License”), which grants the Company an option for a period of 10 years to acquire the ACT Preparations and ACT Treatments in return for royalty payments in the low-single digits during the applicable royalty term.

The Company has not exercised its option and no payments have been made to date under these agreements.

In addition, effective January 1, 2020, the Company entered into a Royalty Sharing Agreement whereby the Company agreed to share with BioAtla Holdings 50 % of the royalties it receives under the Amended and Restated EXUMA License defined and described in Note 12 below.

In addition, effective January 1, 2020, the Company entered into a Royalty Sharing Agreement whereby the Company agreed to share with BioAtla Holdings 50 % of the royalties it receives from its Exclusive License Agreement with EXUMA Biotech Corp.

BioAtla Holdings is a variable interest entity as it does not have sufficient equity to finance its activities without additional subordinated financial support.

The royalty payments and option to acquire assets represent variable interests held by the Company in BioAtla Holdings.

The Company is not the primary beneficiary of BioAtla Holdings, however, as the BioAtla Holdings License and Amended BioAtla Holdings License did not and do not provide the Company with any decision-making power over the activities that are most significant to the entity’s economic success, such as the direction of its development efforts or the search for or terms of any future financing arrangements.

The Company has no equity interest in BioAtla Holdings, and no exposure to its losses.

BioAtla Holdings is currently inactive, and the Company has not provided any support to BioAtla Holdings and has no obligation to do so, and BioAtla Holdings’

creditors have no recourse to the general credit of the Company.

BioAtla Holdings is currently inactive, and the Company has not provided any support to BioAtla Holdings and has no obligation to do so, and BioAtla Holdings’ creditors have no recourse to the general credit of the

The Company does no t have any assets or liabilities associated with its variable interests in BioAtla Holdings at December 31, 2023 and 2022.

BioAtla Holdings is a related party of the Company.

Jay Short and his spouse, Carolyn Anderson Short, serve as managers of BioAtla Holdings.

Jay Short and his spouse serve as managers of BioAtla Holdings.

Himalaya Therapeutics SEZC

Exclusive Rights Agreement

On January 1, 2020, the Company entered into an Amended and Restated Exclusive Rights Agreement (the “Amended Rights Agreement”) with Himalaya Therapeutics SEZC.

Under the terms of the Amended Rights Agreement, Himalaya Therapeutics SEZC acquired the rights to 10 CAB-antibodies for the territory of China, Macao, Hong Kong and Taiwan, global rights to a CAB-HER2-bispecific-antibody and global co-development rights with the Company to an IL-22 non-CAB-antibody.

Payments to the Company may include upfront payments, milestone payments and double digit royalties, which represent a variable interest held by the Company, but no payments have been made to the Company to date.

Himalaya Therapeutics SEZC is a variable interest entity as it does not have sufficient equity to finance its activities without additional subordinated financial support.

Himalaya Therapeutics SEZC is a VIE as it does not have sufficient equity to finance its activities without additional subordinated financial support.

The Company is not obligated to provide financial support to Himalaya Therapeutics SEZC.

The Company is not the primary beneficiary of Himalaya Therapeutics SEZC, however, as the Amended Rights Agreement does not provide BioAtla, Inc.

with the power to direct activities of a VIE that most significantly impact the VIE’s economic performance, such as decision-making power over the direction of its development efforts or the search for or terms of any future financing arrangements.

The Company does no t have any assets or liabilities recorded at December 31, 2023 associated with its variable interest in Himalaya Therapeutics SEZC, and has no exposure to Himalaya Therapeutics SEZC losses.

Himalaya Therapeutics SEZC is a related party as Dr.

Jay Short and his spouse, Carolyn Anderson Short, serve as directors, and Carolyn Anderson Short also serves as an officer of such entity.

Jay Short and his spouse serve as directors, and Dr.

Short's spouse also serves as an officer of such entity.

Clinical Trial Services Agreement

In April 2022, the Company entered into a Clinical Trial Agreement with Himalaya Therapeutics SEZC.

Under the agreement, Himalaya Therapeutics SEZC agreed to provide services related to the initiation of clinical trials for BA3011 in the People’s Republic of China.

Under the agreement, Himalaya Therapeutics SEZC agreed to provide services related to the initiation of clinical trials for mecbotamab vedotin in the People’s Republic of China.

For the first year following effectiveness of the agreement, the Company has agreed to pay Himalaya Therapeutics SEZC for the full-time use of two of its personnel.

Payments are due and payable by BioAtla to Himalaya Therapeutics SEZC on a quarterly calendar basis and are non-refundable.

For the twelve months ended December 31, 2022, the Company recognized $ 0.4 million in research and development expense related to the Clinical Trial Agreement.

Payments were due and payable by BioAtla to Himalaya Therapeutics SEZC on a quarterly calendar basis and are non-refundable.

The Company made its final payment under the agreement in January 2023.

For the twelve months ended December 31, 2023 and 2022, the Company recognized $ 0.1 million and $ 0.4 million in research and development expense related to the Clinical Trial Agreement, respectively.

The Company did not have any amounts due from or due to Himalaya Therapeutics SEZC as of December 31, 2023 .

In January 2024, the Clinical Trial Agreement was amended to extend the agreement for 12 additional months.

Under the amended agreement, BioAtla will pay Himalaya Therapeutics SEZC for the full-time use of two of its personnel and provide services related to the initiation of clinical trials for evalstotug in China.

Himalaya Parent LLC

Jay Short and his spouse, Carolyn Anderson Short, serve as managers of Himalaya Parent LLC.

Jay Short and his spouse serve as managers of Himalaya Parent LLC.

The Company does not have a variable interest in Himalaya Parent LLC.

Private Placement of Common Stock

As part of the 2021 Private Placement, the Company issued 625,000 shares of common stock for total net proceeds of $ 17.5 million to certain stockholders considered to be related parties.

November 2022 Underwritten Offering

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A reconciliation of income tax expense computed at the U.S.

federal statutory income tax rate to the Company’s income tax expense is as follows (in thousands):

Years Ended December 31,

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State income taxes, net of federal tax benefit

Deferred impact of conversion to C Corporation

Nondeductible executive compensation

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Income tax expense

The Company’s net deferred tax assets (liabilities) are as follows (in thousands):

Years Ended December 31,

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The federal and state net operating losses can be carried forward indefinitely, subject to an 80% limitation against taxable income.

The state net operating losses will begin to expire in 2042, unless previously utilized.

At December 31, 2023 , the Company had federal and California research and development credit carryforwards of approximately $ 7.8 million and $ 2.7 million, respectively.

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The orphan drug credit carryforwards will begin to expire in 2041 , unless previously utilized.

Pursuant to Internal Revenue Code (“IRC”) Sections 382 and 383, annual use of the Company’s net operating loss carryforwards may be limited in the event a cumulative change in ownership of more than 50 % occurs within a three-year period.

The Company has not completed an ownership change analysis pursuant to IRC Section 382.

If ownership changes within the meaning of IRC Section 382 are identified as having occurred, the amount of remaining tax attribute carryforwards available to offset future taxable income and income tax expense in future years may be significantly restricted or eliminated.

Further, the Company’s deferred tax assets associated with such tax attributes could be significantly reduced upon realization of an ownership change within the meaning of IRC Section 382.

Pursuant to the Paycheck Protection Program (the “PPP”) of the CARES Act, the Company received a PPP loan in the amount of $ 0.7 million.

In 2021, the Company received forgiveness of the PPP loan.

The loan forgiveness income is not considered taxable for Federal or state income tax purposes.

In accordance with the Consolidated Appropriations Act, 2021 (CAA) enacted on December 27, 2020, certain qualified expenses used with the funds of the PPP Loan are fully deductible for Federal income tax purposes;

however, California does not conform to this aspect of the CAA.

Further, the Company’s deferred tax assets associated with such tax attributes could be significantly reduced upon realization of an ownership change within the meaning of IRC Section 382.

Under the FASB's accounting guidance related to income tax positions, among other things, the impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority.

An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained.

Additionally, the guidance provides guidance on derecognition, classification, interest and penalties, accounting in interim period, disclosure and transition.

Additionally, the guidance provides further clarification on derecognition, classification, interest and penalties, accounting in interim period, disclosure and transition.

The Company regularly evaluates the likelihood of recognizing the benefit for income tax positions taken in various federal and state filings by considering all relevant facts, circumstances, and information available.

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Gross increases - tax positions in prior period

Gross increase –

current-period tax positions

Gross increase – current-period tax positions

Unrecognized tax benefits - ending

As of December 31, 2022 , the Company had gross unrecognized tax benefits of approximately $ 2.0 million, none of which would affect the Company’s effective tax rate due to the existence of the valuation allowance.

The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense.

The Company had no accrual for interest or penalties on the Company’s consolidated balance sheet and has not recognized interest or penalties in the consolidated statements of net and comprehensive income for the year ended December 31, 2022.

As of December 31, 2023 , the Company had gross unrecognized tax benefits of approximately $ 3.6 million, none of which would affect the Company’s effective tax rate due to the existence of the valuation allowance.

The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense.

The Company had no accrual for interest or penalties on the Company’s balance sheet and has not recognized interest or penalties in the statements of operations and comprehensive income for the year ended December 31, 2023.

The Company does not anticipate a significant change to its liability for unrecognized tax benefits within the next twelve months.

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Subsequent events

The Company has completed an evaluation of all subsequent events through March 23, 2023 for the financial statements as of and for the year ended December 31, 2022 to ensure these consolidated financial statements include appropriate disclosure of events both recognized in the consolidated financial statements and events which occurred but were not recognized in the consolidated financial statements.

Except as described below or elsewhere in these consolidated financial statements, the Company has concluded that no subsequent event has occurred that requires disclosure.

In January 2023, BioAtla, Inc.

equity offering program under which Jefferies LLC will act as sales agent.

No shares have been sold under the agreement to date.

The Company has completed an evaluation of all subsequent events through March 26, 2024 for the financial statements as of and for the year ended December 31, 2023 to ensure these financial statements include appropriate disclosure of events both recognized in the financial statements and events which occurred but were not recognized in the financial statements.

Except as described below or elsewhere in these financial statements, the Company has concluded that no subsequent event has occurred that requires disclosure.

Changes in and Disa greements with Accountants on Accounting and Financial Disclosure

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As required by Rules 13a-15(b) and 15d-15(b) of the Exchange Act, our management with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2023.

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 officer, as appropriate to allow timely decisions regarding required disclosure.

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.

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.

Based on the evaluation of our disclosure controls and procedures as of December 31, 2023, our Chief Executive Officer and our Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

Management’s Report on Internal Control over Financial Reporting.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act).

Management conducted an assessment of the effectiveness of our internal control over financial reporting based on the criteria set forth in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework).

Based on the assessment, management has concluded that its internal control over financial reporting was effective as of December 31, 2023, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP.

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In addition, the design of disclosure controls and procedures and internal control over financial reporting must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

See Management’s Report on Internal Control over Financial Reporting above.

Other Information

During the fiscal quarter ended December 31, 2023, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

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Except to the extent provided below, the information required by this Item 10 will be included in our Proxy Statement to be filed with the SEC and is incorporated herein by reference.

We have adopted a Code of Business Conduct and Ethics that applies to all officers, directors and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or person performing similar functions.

We have adopted a Company Code of Business Conduct and Ethics that applies to all officers, directors and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or person performing similar functions.

A current copy of the Code of Business Conduct and Ethics is available on the Corporate Governance section of our website at www.bioatla.com.

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(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 consolidated financial statements or the notes thereto.

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.

The exhibits required by Item 601 of Regulation S-K and Item 15(b) of this Annual Report on Form 10-K are listed in the Exhibit Index immediately preceding the signature page of this Annual Report on Form 10-K.

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Specimen Common Stock Certificate evidencing the shares of common stock

Investors’

Rights Agreement, dated July 13, 2020

Investors’ Rights Agreement, dated July 13, 2020

Description of Securities

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1 to 2020 Equity Incentive Plan

Form of Restricted Stock Agreement

2020 Employee Stock Purchase Plan

Exclusive Rights Agreement with Himalaya SEZC, dated January 1, 2020

Exclusive License Agreement with Inversagen LLC, dated March 15, 2019, as amended by First Amendment to Exclusive License Agreement, dated July 7, 2020

Exclusive License Agreement with BioAtla Holdings LLC, dated January 1, 2020, as amended by First Amendment to Exclusive License agreement, dated July 7, 2020

Amended and Restated Exclusive License Agreement with EXUMA Biotech Corp.

(formerly F1 Oncology, Inc.), dated November 22, 2019

Global Co-Development and Collaboration Agreement with BeiGene, Ltd.

and BeiGene Switzerland GmbH, dated April 8, 2019, as amended by First Amendment, dated December 24, 2019 and as amended by Second Amendment, October 5, 2020

Cell Line License Agreement with Life Technologies Corporation, dated June 28, 2018

Royalty Sharing Agreement with BioAtla Holdings, LLC, dated January 1, 2020

Employment Letter Agreement between BioAtla, LLC and Jay Short, as amended by the Letter Amendment dated October 1, 2011

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Offer Letter between BioAtla, LLC and Richard Waldron, dated October 23, 2013

Severance Agreement between BioAtla, LLC and Richard Waldron, dated July 1, 2018

Exhibit Description

Filed/Furnished Herewith

Severance Agreement between BioAtla, LLC and Richard Waldron, dated July 1, 2018

Offer Letter between BioAtla, LLC and Eric Sievers, dated June 17, 2019

Offer Letter between BioAtla, LLC and Christian Vasquez, dated October 22, 2015

Form of Indemnification Agreement between the Registrant and each of its executive officers

Lease Agreement with HCP Torreyana, LLC, dated June 2, 2017, as amended by First Amendment to Lease, dated January 16, 2019

Form of Indemnification Agreement between the Registrant and each of its executive officers or directors

Lease Agreement with HCP Torreyana, LLC, dated June 2, 2017

First Amendment to Lease with HCP Torreyana, dated January 16, 2019

Master Clinical Trial Collaboration Agreement, dated January 5, 2022, by and between BioAtla, Inc.

and Bristol-Myers Squibb

and Bristol-Myers Squibb Company

First Amendment to Master Clinical Trial Agreement between BioAtla, Inc.

and Bristol-Myers Squibb

and Bristol-Myers Squibb Company

China Clinical Trial Services Agreement, dated April 8, 2022, by and between BioAtla, Inc.

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Amendment No.

1 to Employee Share Purchase Plan

1 to Employee Stock Purchase Plan

Amendment No.

3 to Global Co-Development and Collaboration Agreement between BioAtla, Inc.

and BeiGene, Ltd

3 to Global Co-Development and Collaboration Agreement among BeiGene, Ltd., BeiGene Switzerland GmbH and BioAtla, Inc.

Form of Non-Employee Director Stock Option Agreement

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Management Change of Control Severance Plan

Open Market Sale Agreement SM dated as of January 6, 2023, between BioAtla, Inc.

and Jefferies LLC

Consent of Independent Registered Public Accounting Firm

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Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002.

Compensation Recovery Policy of BioAtla, Inc.

Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

Inline XBRL Taxonomy Extension Schema Document

Inline XBRL Taxonomy Extension Calculation Linkbase Document

Inline XBRL Taxonomy Extension Definition Linkbase Document

Inline XBRL Taxonomy Extension Label Linkbase Document

Inline XBRL Taxonomy Extension Presentation Linkbase Document

Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents

Cover Page Interactive Data File (formatted in iXBRL and contained in Exhibit 101)

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March 26, 2024

/s/ Lawrence Steinman

Lawrence Steinman

/s/ Lawrence Steinman, M.D.

Lawrence Steinman, M.D.

March 26, 2024

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity