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Item 9A. Controls and Procedures

2021-03-25 compared with 2020-03-24 · 45 added, 688 removed, 90 unchanged (89% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended, or the Exchange Act) as of the end of the period covered by this report.

Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report were not effective at a reasonable assurance level due to the material weaknesses in internal control over financial reporting described below.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) as of the end of the period covered by this report.

Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of December 31, 2020, our disclosure controls and procedures were effective at a reasonable assurance level.

The Company’s disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms;

1 unchanged sentence

We believe that a control system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the control system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

Internal Control Over Financial Reporting

In preparation of our financial statements to meet the requirements of our IPO, we determined that material weaknesses in our internal control over financial reporting existed during fiscal 2017 and remain unremediated as of December 31, 2019.

A material weakness is a deficiency or combination of deficiencies in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual and interim financial statements will not be detected or prevented on a timely basis.

The material weaknesses we identified are related to the design and maintenance of an effective control environment commensurate with our financial reporting requirements.

Remediation of Previously Reported Material Weaknesses

Our management previously determined that material weaknesses in our internal control over financial reporting existed related to the design and maintenance of internal controls commensurate with our financial reporting requirements.

Specifically, we lacked a sufficient complement of professionals with an appropriate level of accounting knowledge, training and experience to appropriately analyze, record and disclose accounting matters timely and accurately and we did not design and maintain controls to ensure adequate segregation of duties within our financial reporting function including the preparation and review of journal entries.

The material weaknesses contributed to the restatement of our previously issued 2017 annual financial statements.

Specifically, the material weaknesses resulted in errors in our accounting for and reporting of derivative liabilities, loss on extinguishment of convertible promissory notes and expense classification.

Remediation Activities

Management has been actively engaged in remediating the above described material weaknesses.

The following remedial actions have been taken during the quarter ended December 31, 2019:

• hired additional full-time accounting resources with appropriate levels of experience, including a new Chief Financial Officer, Senior Director of Finance, Senior Manager of SEC Reporting and Senior Manager of Accounting Operations, and reallocated responsibilities across the accounting organization to ensure that the appropriate level of knowledge and experience is applied based on risk and complexity of transactions and tasks under review;

• strengthened our internal policies, processes and reviews, including drafting of related documentation thereof.

The process of implementing an effective financial reporting system is a continuous effort that requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to maintain a financial reporting system that is adequate to satisfy our reporting obligations.

As we continue to evaluate and take actions to improve our internal control over financial reporting, we may take additional actions to address control deficiencies or modify certain of the remediation measures described above.

While progress has been made to enhance our internal control over financial reporting, we are still in the process of implementing these processes, procedures and controls.

Additional time is required to complete implementation and to assess and ensure the sustainability of these procedures.

We believe the above actions will be effective in remediating the material weaknesses described above and we will continue to devote significant time and attention to these remedial efforts.

However, the material weaknesses cannot be considered remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded that these controls are operating effectively.

During 2019 and 2020, management implemented remediation initiatives in response to the previously identified material weakness.

Specific remedial actions included:

• hiring additional personnel in our finance department with experience commensurate with our financial accounting and reporting requirements;

• strengthening our internal policies, processes and reviews, including creation of related documentation thereof;

• implementing an enterprise resource planning system to support key financial processes and controls, including the segregation of duties around the preparation and review of journal entries;

• completing the design and implementation of internal controls to address the relevant risks.

Management believes that these actions have been implemented and have operated effectively for a sufficient period of time.

As a result, we have concluded that our remediation efforts have been successful and that the previously identified material weaknesses were remediated as of December 31, 2020.

Management’s Report on Internal Control Over Financial Reporting

This Annual Report does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of our independent registered public accounting firm due to a transition period established by rules of the SEC for newly public companies.

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

Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2020 based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in its 2013 Internal Control — Integrated Framework.

Based on this assessment, our management has concluded that our internal control over financial reporting was effective as of December 31, 2020.

Changes in Internal Control Over Financial Reporting

The items described in “Remediation Activities” above are considered a change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the fourth quarter of 2019 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Other than the applicable remediation efforts described in “Remediation of Previously Reported Material Weaknesses” above, there have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the fiscal quarter ended December 31, 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Other Information

On March 20, 2020, we entered into Amendment No.

3 to that certain Service Agreement, (the “Amendment”) in order to transition from our previous service model to a more limited consulting arrangement with Ridgeline in 2020 and pursuant to which (i) Ridgeline will seek our consent prior to entering in to any agreements with third parties in connection with services provided pursuant to the Service Agreement, (ii) Ridgeline will transfer all existing company work product to us upon our request and (iii) Ridgeline will invoice us for services performed on an ongoing monthly basis.

Additionally, pursuant to the Amendment, Ridgeline agrees to provide research and development, consulting and other mutually agreed upon services to us in exchange for payment.

Pursuant to the Amendment, the term of the Service Agreement will now run until December 31, 2020 unless either we or Ridgeline elect to terminate the agreement prior to its expiration date.

The foregoing description of the Amendment does not purport to be complete and is subject to and qualified in its entirety by reference to the Amendment a copy of which is filed as Exhibit 10.13 hereto and is incorporated herein by reference.

Directors, Executive Officers and Corporate Governance

The following table sets forth information about our directors, executive officers and other senior management as of March 20, 2020.

Name Age Position(s)

Executive Officers and Senior Management

Epstein, Ph.D.

61 President, Chief Executive Officer and Director

Thomas Leggett 43 Chief Financial Officer

Brent Hatzis-Schoch, Esq.

55 Chief Operating Officer and General Counsel

Christopher D.

Roberts, Ph.D.

50 Chief Scientific Officer

Elizabeth Buck, Ph.D.

45 Executive Vice President, Discovery and Translational Services

Karsten Witt, M.D.

63 Senior Vice President, Clinical Development

Non-Employee Directors

Bradley Bolzon, Ph.D.

60 Director and Chairman of the Board of Directors

Ali Behbahani, M.D.

Samarth Kulkarni, Ph.D.

Alexander Mayweg, Ph.D.

Menzel, Ph.D.

Rajeev Shah (1)

(1) Member of our audit committee

(2) Member of our compensation, nomination and corporate governance committee

The following is a biographical summary of the experience of our executive officers, other senior management and directors.

There are no family relationships among any of our executive officers, other senior management or directors.

Executive officers and senior management

Epstein, Ph.D .

is our co-founder and has served as President, Chief Executive Officer and a member of our board of directors since September 2016.

Since January 2019, Dr.

Epstein has served as an Adjunct Associate Professor for the Cancer and Stem Cell Biology Program at Duke-NUS Medical School.

From April 2013 to December 2018, Dr.

Epstein held positions at Duke-NUS Medical School, Singapore, where he founded and built Duke-NUS’s Center for Technology & Development.

Epstein’s positions include Vice Dean, Innovation & Entrepreneurship, and Associate Professor in Cancer and Stem Biology.

From June 2010 to March 2013, Dr.

Epstein was Senior Vice President, Chief Scientific Officer and Site-Head for OSI Pharmaceuticals, Inc., a pharmaceutical company acquired by Astellas Pharma, Inc.

From 2006 to 2010, Dr.

Epstein served as Senior Vice President and Chief Scientific Officer, Oncology, at OSI Pharmaceuticals, Inc.

until it was acquired by Astellas.

Before joining OSI, from 2001 to 2006, Dr.

Epstein served as Vice President, Biology, and from 2000 to 2003, as co-founder and a member of the board of directors at Archemix Corporation, a biotechnology company.

From April 2013 to April 2015, Dr.

Epstein served as a member of the board of directors at MetaStat, Inc., a precision medicine biotechnology company.

Epstein earned a B.S.

in Chemistry from Lewis & Clark College and a Ph.D.

in Biochemistry at Brandeis University.

Epstein completed a joint post-doctoral fellowship, leading a collaboration in protein structure, function and NMR dynamics between the labs of Steven Benkovic (Penn State) and Peter Wright at The Scripps Research Institute in La Jolla, California.

We believe that Dr.

Epstein is qualified to serve on our board of directors because of his considerable qualifications, attributes and skills, including his distinguished scientific background and experience in leadership roles in the biopharmaceutical industry.

Thomas Leggett has served as our Chief Financial Officer since September 2019.

Prior to joining us, from January 2017 to August 2019, Mr.

Leggett served as Senior Vice President of Finance and Chief Financial Officer at Axcella Health Inc., a biotechnology company.

Prior to joining Axcella, Mr.

Leggett served as the Treasurer and Head of Business Development Finance at Purdue Pharma L.P., a pharmaceutical company, from May 2016 to December 2017.

From November 2009 to April 2016, Mr.

Leggett was an Executive Director at UBS Securities LLC, an investment bank, in the Global Healthcare Group with a primary focus in the biopharmaceutical sector.

Leggett holds an M.B.A.

in finance from The Wharton School at the University of Pennsylvania and a B.A.

in Economics from Columbia University.

Brent Hatzis-Schoch has served as our Chief Operating Officer and General Counsel since May 2019.

Prior to joining us, from April 2015 to May 2019, Mr.

Hatzis-Schoch was Senior Vice President, General Counsel and Corporate Secretary at Radius Health, Inc., a commercial-stage biopharmaceutical company.

Previously, Mr.

Hatzis-Schoch served as Senior Vice President and Chief Legal Counsel at Merz Pharma GmbH & Co.

KGaA, an international healthcare company, in Frankfurt, Germany from July 2013 to April 2015.

Hatzis-Schoch began his legal career in private practice and later held senior legal positions in the U.S.

and internationally, including as General Counsel to two publicly traded development-stage German biopharmaceutical companies, European legal counsel for Baxter International and Associate General Counsel of Pharmacia Corporation (which now operates under Pfizer Inc.).

Hatzis-Schoch received his B.A.

from the University of Delaware and his Juris Doctor from George Washington University.

Hatzis-Schoch was a Fulbright Scholar at the University of Cologne in Germany.

Christopher D.

Roberts, Ph.D.

has served as our Chief Scientific Officer since September 2019.

Prior to joining us, from April 2017 to August 2019, Dr.

Roberts was Entrepreneur in Residence at S.R.

One Limited, the corporate venture capital arm of GlaxoSmithKline plc.

Previously, from April 2015 to March 2017, Dr.

Roberts served as Vice President of Chemistry and Early Development at Syros Pharmaceuticals, Inc., a publicly-traded biotechnology company, where he built and led various discovery and development functions and helped guide two oncology assets into clinical development.

Prior to joining Syros, from January 2009 to March 2015, Dr.

Roberts held numerous positions of increasing responsibility at GSK, including Vice President and Head of the Host Defense Discovery Performance Unit.

Roberts graduated with a B.A.

in Chemistry from Whitworth University and earned his Ph.D.

in Organic Chemistry from the University of California, Riverside, followed by a post-doctoral fellowship at the University of Bern, Switzerland.

Elizabeth Buck, Ph.D.

is our co-founder and has served as our Executive Vice President, Discovery & Translational Services since March 2017.

From 2015 to 2017, she served as our Chief Scientific Officer.

Prior to joining us, from September 2013 to December 2014, Dr.

Buck served as Chief Scientific Officer for Therapeutics at MetaStat, Inc., a precision medicine biotechnology company.

Previously, from 2005 to 2013, Dr.

Buck was Assistant Director of Advanced Preclinical Pharmacology at OSI Pharmaceuticals, Inc., a pharmaceutical company acquired by Astellas Pharma Inc., where she led discovery and translational research to advance a series of oncology programs to clinical development.

In this role, Dr.

Buck managed multidisciplinary global teams and spearheaded major academic collaborations to progress programs to IND.

Her expertise and productivity are evidenced by more than 40 peer reviewed publications and patents.

Buck received her undergraduate degree in Physics from the University of New Hampshire, her Ph.D.

in Cellular and Molecular Biology from New York University/Mount Sinai School of Medicine, and completed postdoctoral work with Jim Wells at Sunesis Pharmaceuticals, Inc., a publicly traded biopharmaceutical company.

Karsten Witt, M.D.

has served as our Senior Vice President, Clinical Development since May 2019.

Since February 2013, Dr.

Witt has served as President of KW Biotech Consulting, LLC, a provider of strategic, scientific and medical consulting services in drug development.

From August 2011 to August 2014, Dr.

Witt served as Chair of Scientific Subcommittee for TopoTarget A/S, a Copenhagen-based biotechnology company, until its merger with BioAlliance resulting in the formation of Onxeo SA.

Previously, from August 2011 to January 2013, Dr.

Witt served as Vice President, Clinical Sciences & Drug Safety at Array BioPharma Inc., a biopharmaceutical company.

From 2002 until he joined Array, Dr.

Witt served as Senior Vice President, Pharmaceutical Operations at OSI Pharmaceuticals, Inc., a pharmaceutical company acquired by Astellas Pharma, Inc., where he was intimately involved in the development of small-molecule targeted oncology therapies.

Witt received his M.D.

from the University of Copenhagen in Denmark and practiced medicine at Hvidovre University Hospital in Copenhagen in the internal medicine subspecialties of gastroenterology, infectious disease, and cardiology, before transitioning to the biopharmaceutical industry.

Non-employee directors

Bradley Bolzon, Ph.D.

has been our chairman and a member of our board of directors since December 2017.

Bolzon is Chairman and Managing Director of Versant Venture Management, LLC, where he has been employed since May 2004.

Bolzon previously served as a member of the board of directors of Flexion Therapeutics, Inc., a pharmaceutical company, from its inception in 2007 to June 2014.

From February 2000 to May 2004, Dr.

Bolzon served as Executive Vice President, Global Head of Business Development, Licensing & Alliances of F.

Hoffman-La Roche AG., a multinational healthcare company.

Bolzon also held executive roles at Eli Lilly and Company, a global pharmaceutical company, in drug discovery, clinical research, regulatory affairs and business development.

Since April 2014, Dr.

Bolzon has served as a member of the board of directors of CRISPR Therapeutics AG, a biotech company.

Bolzon received a Ph.D.

in Pharmacology and an M.S.

in Pharmacology from the University of Toronto.

He conducted post-doctoral work at the University of Ottawa Heart Institute.

We believe that Dr.

Bolzon is qualified to serve on our board of directors because of his experience, qualifications, attributes and skills, including his global pharmaceutical industry experience and similar tenure as a venture capitalist.

Ali Behbahani, M.D.

has been a member of our board of directors since December 2018.

Behbahani joined New Enterprise Associates, Inc., or NEA, in 2007 and is a General Partner on the healthcare team.

Behbahani is currently on the board of directors of Adaptimmune Therapeutics, a biopharmaceutical company, Genocea Biosciences, Inc., a biopharmaceutical company, and CRISPR Therapeutics AG, a biotech company.

Prior to joining NEA, Dr.

Behbahani served as a consultant in business development at The Medicines Company, a pharmaceutical company.

In addition, Dr.

Behbahani formerly served as a Venture Associate at Morgan Stanley and as a Healthcare Investment Banking Analyst at Lehman Brothers.

Behbahani received an M.D.

from the University of Pennsylvania School of Medicine, an M.B.A.

from the Wharton School of the University of Pennsylvania and a B.S.

in Biomedical Engineering, Electrical Engineering and Chemistry from Duke University.

We believe that Dr.

Behbahani is qualified to serve on our board of directors because of his experience, qualifications, attributes and skills, including his extensive investment experience in the life sciences and his service as a director of other publicly traded companies.

Samarth Kulkarni, Ph.D.

has been a member of our board of directors since December 2019.

Kulkarni has served as the Chief Executive Officer of CRISPR Therapeutics AG, or CRISPR, a bipharmaceutical company, since December 2017.

Prior to that, Dr.

Kulkarni served as CRISPR’s President and Chief Business Officer from May 2017 to November 2017 and, before that, as Chief Business Officer from August 2015 when he joined the company.

Prior to joining CRISPR, Dr.

Kulkarni was at McKinsey & Company, a global consulting firm, from 2006 to July 2015, with various titles, his most recent being Partner within the Pharmaceuticals and Biotechnology practice.

Kulkarni received a Ph.D.

in Bioengineering and Nanotechnology from the University of Washington and a B.

from the Indian Institute of Technology.

We believe that Dr.

Kulkarni is qualified to serve on our board of directors based on his experience as an executive in the biopharmaceutical industry.

Alexander Mayweg, Ph.D.

has served as a member of our board of directors since March 2017 and, from March 2017 to September 2019, served as our interim Chief Scientific Officer.

Mayweg has served as a Partner at Versant Ventures, a healthcare investment firm, since January 2018, and previously served as a Venture Partner at Versant Ventures from January 2017 to December 2017.

Additionally, since April 2017, Dr.

Mayweg has served as Chief Scientific Officer at Ridgeline Therapeutics, a Versant Ventures Discovery Engine that creates and operates Versant-financed biotechnology companies in Basel, Switzerland.

Prior to joining Versant, from 2013 to 2016, Dr.

Mayweg served as Vice President and Global Head of Medicinal Chemistry at F.

Hoffmann-La Roche AG, a multinational healthcare company, and held various leadership positions at Roche in pharmaceutical drug discovery and medicinal chemistry across Europe, the U.S.

Mayweg graduated with a B.S.

in Chemistry from the Imperial College in London and earned a Ph.D.

in Organic Chemistry at Oxford University, followed by post-doctorate training at Stanford University.

We believe that Dr.

Mayweg is qualified to serve on our board of directors based on his knowledge of the healthcare sector across international markets and his extensive operational experience in the biopharmaceutical industry.

Menzel, Ph.D.

has been a member of our board of directors since March 2017.

Since October 2016, Dr.

Menzel has served as President and Chief Executive Officer at TCR 2 Therapeutics Inc., a publicly traded immunotherapy company, and is currently a member of the board of directors.

Previously, Dr.

Menzel was Chief Strategy Officer at Axcella Health Inc., a biotechnology company, from July 2015 to September 2016, the Chief Financial Officer at DaVita Inc., a healthcare services company, from 2013 to May 2015, and the Chief Operating Officer at Regulus Therapeutics Inc., a biopharmaceutical company, from 2008 to 2013.

Menzel also had global leadership roles in running the biotechnology practices at Goldman Sachs & Co.

LLC and Credit Suisse Group AG, both of which are multinational investment bank and financial services companies, from 1994 to 2004 and from 2004 to 2008, respectively.

In addition, he was a consultant with Bain & Company, a global management consulting firm, and was a research assistant at SmithKline Beecham PLC (now GlaxoSmithKline PLC).

Menzel received his B.S.

in Biochemistry from Imperial College of Science and Technology in London, his Ph.D.

from the University of Cambridge, where he studied the regulation of oncogenes in immune cells, and his M.B.A.

from the Stanford University Graduate School of Business.

We believe that Dr.

Menzel is qualified to serve as a member of our board of directors because of his scientific background and extensive corporate leadership experience in the life sciences industry.

Rajeev Shah has been a member of our board of directors since December 2018.

Since June 2004, Mr.

Shah has served as a Managing Director and Portfolio Manager at RA Capital Management, LLC, an investment advisory firm that invests in healthcare companies.

Previously, from 2000 to 2004, Mr.

Shah was a Senior Project Leader at Altus Pharmaceuticals Inc., a spin-off company of Vertex Pharmaceuticals, where he assessed business processes and implemented system solutions across all areas of science.

Shah served as a member of the board of directors of KalVista Pharmaceuticals, Inc., a biopharmaceutical company, from June 2015 to April 2018, and currently serves on the board of RA Pharmaceuticals, Inc., Solid Biosciences Inc., Eidos Therapeutics, Inc.

and Kala Pharmaceuticals, Inc.

He is also an active member of the Big Brothers of Massachusetts Bay program.

Shah holds a B.A.

in Chemistry from Cornell University.

We believe that Mr.

Shah is qualified to serve as a member of our board of directors because of his extensive experience in the biopharmaceutical industry and his experience with venture capital investments.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our directors, executive officers, and persons holding more than 10% of our common stock to report their initial ownership of the common stock and other equity securities and any changes in that ownership in reports that must be filed with the SEC.

The SEC has designated specific deadlines for these reports, and we must identify in our Annual Report on From 10-K those persons who did not file these reports when due.

Based solely on a review of reports furnished to us, or written representations from reporting persons, we believe all directors, executive officers, and 10% owners timely filed all reports regarding transactions in our securities required to be filed for 2019 by Section 16(a) under the Exchange Act.

Board composition

Our board of directors currently consists of seven members.

Our compensation, nomination and corporate governance committee and our board of directors may therefore consider a broad range of factors relating to the qualifications and background of nominees.

Our compensation, nomination and corporate governance committee’s and our board of directors’ priority in selecting board members is identification of persons who will further the interests of our stockholders through their established record of professional accomplishment, the ability to contribute positively to the collaborative culture among board members, knowledge of our business, understanding of the competitive landscape, professional and personal experiences and expertise relevant to our growth strategy.

Our directors hold office until their successors have been elected and qualified or until their earlier resignation or removal.

Our amended and restated certificate of incorporation and amended and restated bylaws provide that our directors may be removed only for cause by the affirmative vote of the holders of at least two thirds (2/3) of the votes that all our stockholders would be entitled to cast in an annual election of directors, and that any vacancy on our board of directors, including a vacancy resulting from an enlargement of our board of directors, may be filled only by vote of a majority of our directors then in office.

Staggered board

In accordance with the terms of our amended and restated certificate of incorporation and our amended and restated bylaws, our board of directors will be divided into three staggered classes of directors and each director will be assigned to one of the three classes.

At each annual meeting of the stockholders, one class of directors will be elected for a three-year term to succeed the directors of the same class whose terms are then expiring.

The terms of the directors will expire upon the election and qualification of successor directors at the annual meeting of stockholders to be held during the years 2020 for Class I directors, 2021 for Class II directors and 2022 for Class III directors.

• Our Class I directors will be Alexander Mayweg and Rajeev Shah;

• Our Class II directors will be Ali Behbahani, Garry E.

Menzel and Samarth Kulkarni;

• Our Class III directors will be David M.

Epstein and Bradley Bolzon.

The number of our directors shall be fixed from time to time by a resolution of the majority of our board of directors.

The division of our board of directors into three classes with staggered three-year terms may delay or prevent stockholder efforts to effect a change of our management or a change in control.

Code of business conduct and ethics

Our board of directors has adopted a Code of Business Conduct and Ethics.

The Code of Business Conduct and Ethics applies to all of our employees, officers (including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions), agents and representatives, including directors and consultants.

The full text of our Code of Business Conduct and Ethics is posted on our website at http://www.

blackdiamondtherapeutics.com.

We intend to disclose future amendments to certain provisions of our Code of Business Conduct and Ethics on our website.

The inclusion of our website address in this Annual Report does not include or incorporate by reference the information on our website into this Annual Report, and you should not consider that information a part of this Annual Report.

Audit committee

The members of our audit committee are Garry E.

Menzel, Ali Behbahani and Rajeev Shah, and Garry E.

Menzel is the chair of the audit committee.

Our board of directors has determined that all members of our audit committee meet the requirements for financial literacy under the applicable rules and regulations of the SEC and the Nasdaq listing rules.

Our board of directors has determined that Garry E.

Menzel qualifies as an “audit committee financial expert” within the meaning of applicable SEC regulations.

In making this determination, our board of directors considered the nature and scope of experience that Garry E.

Menzel has previously had with public reporting companies, including service as Chief Executive Officer of TCR 2 Therapeutics Inc.

Our board of directors has determined that all members of our audit committee satisfy the relevant independence requirements for service on the audit committee set forth in the rules of the SEC and the Nasdaq listing rules.

The information required under this item is incorporated by reference to the information in our Proxy Statement for our 2021 Annual Meeting of Stockholders, which we will file with the SEC within 120 days of the end of the fiscal year to which this Annual Report relates.

Executive Compensation

Executive Compensation Overview

As an “emerging growth company,” we have opted to comply with the executive compensation disclosure rules applicable to “smaller reporting companies,” as such term is defined in the rules promulgated under the Securities Act.

This section provides an overview of the compensation awarded to, earned by, or paid to each individual who served as our principal executive officer during our fiscal year 2019, and our next two most highly compensated executive officers in respect of their service to our company for fiscal year 2019.

We refer to these individuals as our named executive officers.

Our named executive officers for fiscal year 2019 are:

Epstein, Ph.D., our President and Chief Executive Officer;

• Thomas Leggett, our Chief Financial Officer;

• Christopher D.

Roberts, Ph.D., our Chief Scientific Officer.

Our executive compensation program is based on a pay for performance philosophy.

Compensation for Dr.

Leggett and Dr.

Roberts and our executive officers is composed primarily of the following main components:

base salary, bonus, and equity incentives in the form of stock options.

Like all full-time employees, our executive officers are eligible to participate in our health and welfare benefit plans.

We will evaluate our compensation philosophy and compensation plans and arrangements as circumstances require.

2019 Summary Compensation Table

The following table provides information regarding the total compensation, for services rendered in all capacities, that was earned by our named executive officers during fiscal year 2019 as well as, for Dr.

Epstein, during fiscal year 2018.

Name and Principal Position Year Salary

($)(1) Option

($)(2) Non-Equity

Incentive Plan

($)(3) All other

Epstein, Ph.D.

President, Chief Executive Officer (5)

2018 214,250 — — 93,267 8,400 315,917

2019 428,904 — 2,728,815 171,562 16,800 3,346,081

Thomas Leggett

Chief Financial Officer (6)

2019 112,292 62,500 1,806,226 35,000 10,603 2,026,621

Christopher D.

Roberts, Ph.D.

Chief Scientific Officer (6)

2019 110,271 — 1,559,875 33,500 6,735 1,710,381

(1) The amount reported represents the first installment of a $125,000 one-time sign-on bonus to be paid to Mr.

The second installment of $62,500 will be paid with the first paycheck after the first year anniversary of his employment, subject to his employment with the company through such date.

(2) The amount reported represents the aggregate grant date fair value of the stock options awarded to each executive during fiscal year 2019, calculated in accordance with Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC, Topic 718.

Such grant date fair value does not take into account any estimated forfeitures.

The assumptions used in calculating the grant date fair value of the stock option reported in this column are set forth in note 8 of our consolidated financial statements included elsewhere in this Annual Report.

The amount reported in this column reflects the accounting cost for the stock option and does not correspond to the actual economic value that may be received upon the exercise of the stock option or any sale of the underlying shares of common stock.

(3) The amounts reported for fiscal year 2019 reflect estimated discretionary bonuses that are anticipated to be paid to Dr.

Leggett and Dr.

Roberts based upon achievement of certain company and individual performance metrics.

The final amounts will be determined by our board of directors in early 2020 and may vary from what is currently set forth in the table above.

(4) The amount reported for fiscal year 2018 represents the amount of contributions made by us to the Simplified Employee Pension Plan of Dr.

The amounts reported for fiscal year 2019 represent the amount of contributions made by us to the Simplified Employee Pension Plans of Dr.

Leggett and Dr.

(5) The amount reported for Dr.

Epstein represents the total salary Dr.

Epstein received for his part-time service to us in fiscal year 2018.

Leggett and Dr.

Roberts joined our company on September 5, 2019 and September 3, 2019, respectively.

The amounts reported represent the compensation each received during their partial year of service for fiscal year 2019.

Narrative to 2019 Summary Compensation Table

Base Salaries

We use base salaries to recognize the experience, skills, knowledge and responsibilities required of all our employees, including our named executive officers employed by the Company.

Base salaries are generally reviewed annually, typically in connection with our annual performance review process, and adjusted from time to time to realign salaries with market levels after taking into account individual responsibilities, performance and experience.

For fiscal year 2019, the annual base salaries for Dr.

Leggett and Dr.

Roberts were $428,904, $350,000 and $335,000, respectively.

Annual Bonuses

During fiscal year 2019, Dr.

Leggett and Dr.

Roberts earned bonuses as set forth in the 2019 Summary Compensation Table above based on company and individual performance metrics.

Equity Compensation

Although we do not have a formal policy with respect to the grant of equity incentive awards to our executive officers, we believe that equity grants provide our executives with a strong link to our long-term performance, create an ownership culture and help to align the interests of our executives and our stockholders.

In addition, we believe that

equity grants with a time-based vesting feature promote executive retention because this feature incentivizes our executive officers to remain in our employment during the vesting period.

Accordingly, our board of directors periodically reviews the equity incentive compensation of our named executive officers and from time to time may grant equity incentive awards to them.

During fiscal year 2019, we granted an option to purchase shares of our common stock to Dr.

Leggett and Dr.

Roberts, as described in more detail in the “Outstanding Equity Awards at Fiscal 2019 Year End” table.

We generally do not provide perquisites to our executives, other than company-paid executive life insurance and executive long-term disability insurance premiums, reimbursement for relocation expenses and certain other de minimis perquisites to our executive officers, including our named executive officers.

Executive Employment Arrangements

We have entered into new employment agreements with each of the named executive officers, which replaced each named executive officer’s existing employment agreement or offer letter effective upon the closing of our initial public offering February 3, 2020.

The new employment agreements provide for Dr.

Epstein’s, Mr.

Leggett’s and Dr.

Roberts’ continued employment and set forth their new annual base salary of $515,000, $390,000 and $375,000, respectively, the terms of their discretionary annual bonus, the term of their employment, certain expense reimbursements, and their eligibility to participate in our benefit plans generally.

Pursuant to the new employment agreements, in the event that the named executive officer’s service relationship with the company is terminated without “cause” (as defined in their employment agreements) or upon the named executive officer’s resignation from the company for “good reason” (as defined in their employment agreements), in either case within 12 months after the occurrence of the first event constituting a “change in control” (as defined in their employment agreements), subject to the execution of an effective release of claims in favor of the company, the named executive officer may be entitled to the following severance benefits:

(i) a lump sum payment equal to twelve months (or in the case of Dr.

Epstein, eighteen months) of his then current base salary or the base salary in effect immediately prior to the change in control, if higher;

(ii) an amount equal to his annual target bonus for the then-current year (or in the case of Dr.

Epstein, equal to eighteen months of his target bonus for the then-current year);

(iii) immediate acceleration of all stock options and other stock-based awards held by the named executive officer;

and (iv) up to twelve months (or in the case of Dr.

Epstein, eighteen months) of COBRA premiums reimbursements.

Upon the termination of a named executive officer’s service relationship by the company without cause or upon the named executive officer’s resignation from the company for good reason, in either case other than in connection with a change in control, subject to the execution of an effective release of claims in favor of the company, the named executive officer may be entitled to the following severance benefits:

(i) continuation of salary payments at the base salary rate effective at the time of termination for a period of twelve months following the termination date;

(ii) an amount equal to his target bonus for the then-current year;

(iii) up to twelve months of COBRA premiums reimbursements;

and, in the case of Dr.

Epstein only, (iv) partial accelerated vesting of Dr.

Epstein’s outstanding stock options with respect to the same number of shares that would have vested if he had continued in employment with the Company through the next anniversary of the grant date for such option, in accordance with the vesting schedule applicable to such option, provided that if the termination date falls on an anniversary of the grant date of any stock option, no accelerated vesting will be provided for such option.

Furthermore, for Dr.

Epstein only, in the event of a termination of his employment by death or “disability” (as defined in Dr.

Epstein’s employment agreement), and subject to Dr.

Epstein’s (or his estate’s or heirs’, as applicable) execution of an effective release of claims in favor of the Company, Dr.

Epstein is eligible to receive the following severance benefits:

(i) continuation of salary payments at the base salary rate effective at the time of termination for a period of 75 days following the termination date;

and (ii) partial accelerated vesting of Dr.

In addition, each of our named executive officers have entered into an agreement with us, which contains protections of confidential information, requires the assignment of inventions and contains other restrictive covenants.

Outstanding Equity Awards at Fiscal 2019 Year-End

The following table sets forth information regarding outstanding equity awards held by our named executive officers as of fiscal year 2019:

Option Awards (1)

Date Number of

Exercisable Number of

Unexercisable(2)

Epstein, Ph.D.

8/14/2019 — 244,616 6.42 8/13/2029

12/5/2019 — 281,847 10.86 12/4/2029

Thomas Leggett 9/5/2019 — 233,171 10.86 9/8/2029

12/5/2019 — 55,540 10.86 12/4/2029

Christopher D.

Roberts, Ph.D.

9/3/2019 — 194,309 10.86 9/8/2029

12/5/2019 — 54,711 10.86 12/4/2029

(1) Each equity award is subject to the terms of our 2017 Plan.

(2) 25% of the shares subject to the stock option vest on the first anniversary of the vesting commencement date and the remaining 75% vest in 36 equal monthly installments thereafter, generally subject to the named executive officer’s continuous service relationship with the company through each applicable vesting date.

Equity Grants in Connection with our Initial Public Offering

Our board of directors approved stock option grants to certain employees, including our named executive officers, in December 2019 that were effective upon our IPO.

The stock options were granted under our 2020 Stock Option and Incentive Plan and have an exercise price of $19.00, which was the fair market value of a share of the Company’s common stock on the grant date of the options.

The options will vest and become exercisable as follows:

25% of the shares subject to each stock option shall vest on the first anniversary of the vesting commencement date and the remaining 75% of the shares subject to each stock option shall vest in 36 equal monthly installments thereafter, subject to the named executive officer’s continued service to us through each applicable vesting date.

We granted options to purchase an aggregate of 497,376 shares of common stock, with Dr.

Leggett and Dr.

Roberts being granted options to purchase 278,532, 55,540 and 54,711 shares of our common stock, respectively.

Director Compensation

The following table provides information regarding the total compensation that was earned by or paid to each of our non-employee directors during fiscal year 2019.

During fiscal year 2019, David M.

Epstein, Ph.D., our President and Chief Executive Officer, served as a member of our board of directors, as well as an employee, and received no additional compensation for his services as a member of our board of directors.

See the section titled “Executive Compensation” for more information about Dr.

Epstein’s compensation for our fiscal year 2019.

Additionally, Alexander Mayweg, Ph.D., a director who was an executive officer during fiscal year 2019, received no additional compensation for his service as a director during fiscal year 2019.

Directors may be reimbursed for travel and other expenses directly related to their activities as directors.

Non-Employee Director Compensation Table

Cash ($) Option

Samarth Kulkarni (2) — 342,903 342,903

Menzel (3) 20,000 142,513 162,513

Ali Behbahani, Brad Bolzon, Alexander Mayweg and Rajeev Shah (4) — — —

(1) The amounts reported represent the aggregate grant date fair value of the stock options awarded to the non-employee directors in the fiscal year 2019, calculated in accordance with FASB ASC Topic 718.

Such grant date fair values do not take into account any estimated forfeitures.

The assumptions used in calculating the grant date fair value of the stock options reported in this column are set forth in note 8 of our consolidated financial statements included elsewhere in this Annual Report.

The amounts reported in this column reflect the accounting cost for these stock options and do not correspond to the actual economic value that may be received by the non-employee directors upon the exercise of the stock options or any sale of the underlying shares of common stock.

Kulkarni joined our board of directors on December 5, 2019.

As of December 31, 2019, Mr.

Kulkarni held an option to purchase 53,053 shares of our common stock.

(3) As of December 31, 2019, Mr.

Menzel held an option to purchase 38,861 shares of our common stock.

Additionally, Mr.

Menzel received $20,000 as an annual fee for his services as chair of our Audit Committee in fiscal year 2019.

(4) As of December 31, 2019, Messrs.

Behbahani, Bolzon, Mayweg and Shah did not hold any outstanding equity awards.

Non-Employee Director Compensation Program

Our board of directors has adopted a non-employee director compensation policy pursuant to which our non-employee directors will be eligible to receive the following cash retainers and equity awards:

Annual Retainer for Board Membership

Annual service on the board of directors $ 35,000

Additional compensation for service as chair of the board of directors $ 30,000

Additional Annual Retainer for Committee Membership

Annual service as member of the audit committee (other than chair) $ 7,500

Annual service as chair of the audit committee $ 15,000

Annual service as member of the compensation, nomination and corporate governance committee (other than chair) $ 5,000

Annual service as chair of the compensation, nomination and corporate governance committee $ 10,000

Our policy will provide that, upon initial election to our board of directors, each non-employee director will be granted an option to purchase 29,842 shares of our common stock (“Initial Grant”).

Furthermore, on the date of each of our annual meeting of stockholders, each non-employee director who will continue as a non-employee director following such meeting will be granted an option to purchase 14,921 shares of our common stock (“Annual Grant”).

The Annual Grant will vest in full on the earlier of (i) the one-year anniversary of the grant date or (ii) the next annual meeting of stockholders, subject to continued service as a director through the applicable vesting date.

The Initial Grant will vest in 36 equal monthly installments, subject to continued service as a director through the applicable vesting date.

Such awards are subject to full accelerated vesting upon the sale of the Company.

Employee directors will receive no additional compensation for their service as a director.

We will reimburse all reasonable out-of-pocket expenses incurred by directors for their attendance at meetings of our board of directors or any committee thereof.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Securities authorized for issuance under equity compensation plans

The following table sets forth information as of December 31, 2019 regarding shares of common stock that may be issued under our equity compensation plans, consisting of the Black Diamond Therapeutics, Inc.

Amended and Restated 2017 Stock Incentive Plan.

Plan category Number of securities to be issued upon exercise of outstanding options, warrants and rights (#) Weighted-average exercise price of outstanding options, warrants and rights ($) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in first column)

Equity compensation plans approved by security holders 2,389,231 (1) $ 8.05 138,603 (2)

Equity compensation plans not approved by security holders — — —

Total 2,389,231 $ 8.05 138,603

(1) Includes 2,378,474 and 10,757 shares of common stock issuable upon exercise of outstanding stock options and warrants, respectively.

(2) As of December 31, 2019 there were 138,603 shares available for grant under the 2017 Employee Stock Option Plan.

Security ownership of certain beneficial owners

The following table sets forth, as of February 3, 2020, information regarding the beneficial ownership of our common stock by:

• each person, or group of affiliated persons, who is known by us to be the beneficial owner of five percent or more of our outstanding common stock;

• each of our directors;

• each of our named executive officers;

• all of our current directors and executive officers as a group.

The column entitled “Shares Beneficially Owned” is based on a total of 35,910,705 shares of common stock outstanding as of February 3, 2020.

Each individual or entity shown on the table has furnished information with respect to beneficial ownership.

Except as otherwise indicated below, the address of each officer, director and five percent stockholder listed below is c/o Black Diamond Therapeutics, Inc., 139 Main Street, Cambridge, MA 02142.

We have determined beneficial ownership in accordance with the rules of the SEC, and the information is not necessarily indicative of beneficial ownership for any other purpose.

These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities as well as any shares of common stock that the person has the right to acquire within 60 days of February 3, 2020 through the exercise of stock options or other rights.

These shares are deemed to be outstanding and beneficially owned by the person holding those options for the purpose of computing the percentage ownership of that person, but they are not treated as outstanding for the purpose of computing the percentage ownership of any other person.

Unless otherwise indicated, the persons or entities identified in this table have sole voting and investment power with respect to all shares shown as beneficially owned by them.

Shares Beneficially Owned

Number Percentage

5% or Greater Stockholders

Entities affiliated with Versant Venture Capital (1)

10,884,478 30.31 %

Entities affiliated New Enterprise Associates (2)

3,449,845 9.61 %

Entities affiliated RA Capital Management (3)

2,589,904 7.21 %

Entities affiliated with Boxer Capital, LLC (4)

2,050,767 5.71 %

Directors, Named Executive Officers and Other Executive Officers

971,979 2.71 %

Brent Hatzis-Schoch 3,000 *

Thomas Leggett — *

Christopher D.

Ali Behbahani — *

Bradley Bolzon — *

Alexander Mayweg (6)

Rajeev Shah — *

Samarth Kulkarni (8)

All executive officers and directors as a group (10 persons) 1,076,848 3.00 %

* Less than one percent.

(1) Consists of:

(a) 6,809,414 shares of common stock purchased by Versant Venture Capital VI, L.P, (b) 2,209,592 shares of common stock held by Versant Voyageurs I, L.P., (d) 658,869 shares of common stock held by Versant Voyageurs I Parallel, L.P, and (e) 1,206,603 shares of common stock held by Versant Vantage I, L.P.

(2) Consists of:

(a) 3,448,757 shares common stock held by New Enterprise Associates 16, L.P., and (b) 1,088 shares of common stock held by NEA Ventures 2018, Limited Partnership.

(3) Consists of:

(a) 1,924,164 shares of common stock held by RA Capital Healthcare Fund, LP, (b) 311,926 shares of common stock held by RA Capital Nexus Fund, L.P.

and (c) 353,814 shares of common stock held by Blackwell Partners LLC—Series A.

(4) Consists of:

(a) 1,989,858 shares of common stock held by Boxer Capital, LLC and (b) 60,909 shares of common stock held by MVA Investors, LLC.

(5) Consists of:

(a) 729,923 shares of common stock held by Mr.

Epstein, (b) 104,449 shares of common stock held by David M.

Epstein 2019 Trust For Elle, (c) 104,449 shares of common stock held by David M.

Epstein 2019 Trust For Zoe, (d) 16,579 shares of common stock held by David M.

Epstein Trust for Robert, (e) 16,579 shares of common stock held by David M.

Epstein Trust for Shelley.

(6) Consists of 16,247 shares of common stock held by Mr.

(7) Consists of:

(a) 24,819 shares of common stock held by Mr.

Menzel, (b) 51,825 shares of common stock held by the Garry E.

Menzel and Mary E.

Henshall Family Trust and (c) 5,663 shares of common stock underlying options exercisable within 60 days of February 3, 2020.

(8) 3,315 shares of common stock underlying options exercisable within 60 days of February 3, 2020.

Certain Relationships and Related Transactions, and Director Independence

Certain relationships and related person transactions

The following is a description of transactions or series of transactions since January 1, 2018, to which we were or will be a party, in which:

• the amount involved in the transaction exceeds, or will exceed, $120,000;

• in which any of our executive officers, directors or holder of five percent or more of any class of our capital stock, including their immediate family members or affiliated entities, had or will have a direct or indirect material interest.

Compensation arrangements for our named executive officers and our directors are described elsewhere in this Annual Report under “Director Compensation” and “Executive Compensation.”

Private placements of securities

Series A Preferred Stock Financing

In March 2017, with subsequent closings in December 2017, August 2018 and November 2018, we sold an aggregate of 22,501,503 shares of our Series A preferred stock at a purchase price of $1.00 per share for an aggregate amount of $20 million.

In connection with the issuance of our Series A preferred stock, all of our outstanding convertible promissory notes issued in 2014, 2015 and 2016 were automatically converted into 2,501,503 shares of our Series A preferred stock.

Certain investors holding convertible notes issued in 2014, 2015 and 2016 used such notes to purchase our Series A preferred stock.

All outstanding convertible notes were cancelled in connection with the purchase of such Series A preferred stock.

The following table summarizes purchases of our Series A preferred stock by related persons:

Stockholder Shares of

Entities affiliated with Versant Venture Capital (1)

20,000,000 $ 20,000,000.00

(1) Represents 15,000,000 shares of Series A preferred stock purchased by Versant Venture Capital VI, L.P., 3,728,392 shares of Series A preferred stock purchased by Versant Voyageurs I, L.P., and 1,271,608 shares of Series A preferred stock purchased by Versant Voyageurs I Parallel, L.P.

Each of Bradley Bolzon and Alexander Mayweg serves as a director of the Company and is an affiliate of Versant Venture Capital,, of which Versant Venture Capital VI, L.P., Versant Voyageurs I, L.P., and Versant Voyageurs I Parallel, L.P.

are affiliated funds.

Entities affiliated with Versant Venture Capital collectively hold more than 5% of our voting securities.

Series B Preferred Stock Financing

In December 2018, with subsequent closings in July 2019 and August 2019, we sold an aggregate of 22,917,726 shares of our Series B preferred stock at a purchase price of $3.806 per share for an aggregate amount of $87.2 million.

The following table summarizes purchases of our Series B preferred stock by related persons:

Stockholder Shares of

Entities affiliated with Versant Venture Capital (1)

3,941,142 $ 15,000,000.00

Entities affiliated with New Enterprise Associates 16, L.P.

6,568,574 $ 25,000,000.00

Entities affiliated with RA Capital Management (3)

3,941,142 $ 15,000,000.00

13,136 $ 50,000.00

(1) Represents 1,970,572 shares of Series B preferred stock purchased by Versant Venture Capital VI, L.P., 1,469,412 shares of Series B preferred stock purchased by Versant Voyageurs I, L.P.

and 501,158 shares of Series B preferred stock purchased by Versant Voyageurs I Parallel, L.P.

Each of Bradley Bolzon and Alexander Mayweg serves as a director of the Company and is an affiliate of Versant Venture Capital, of which Versant Venture Capital VI, L.P., Versant Voyageurs I, L.P.

and Versant Voyageurs I Parallel, L.P.

are affiliated funds.

Entities affiliated with Versant Venture Capital collectively hold more than 5% of our voting securities.

(2) Represents 6,565,290 shares of Series B preferred stock purchased by New Enterprise Associates 16, L.P.

and 3,284 shares of Series B preferred stock purchased by NEA Ventures 2018, Limited Partnership.

Ali Behbahani serves as a director of the Company and is an affiliate of New Enterprise Associates, of which New Enterprise Associates 16, L.P.

and NEA Ventures 2018, Limited Partnership are affiliated funds.

Entities affiliated with New Enterprise Associates collectively hold more than 5% of our voting securities.

(3) Represents 2,885,295 shares of Series B preferred stock purchased by RA Capital Healthcare Fund, LP, 492,643 shares of Series B preferred stock purchased by RA Capital Nexus Fund, L.P.

and 563,204 shares of Series B preferred stock purchased by Blackwell Partners LLC—Series A.

Rajeev Shah serves as a director of the Company and is an affiliate of RA Capital Management, of which RA Capital Healthcare Fund, LP, RA Capital Nexus Fund, L.P.

and Blackwell Partners LLC—Series A are affiliated funds.

Entities affiliated with RA Capital Management collectively hold more than 5% of our voting securities.

Epstein is a founder of the Company and currently serves as our Chief Executive Officer and President.

Epstein holds more than 5% of our voting securities.

Series C Preferred Stock Financing

In November 2019, we sold an aggregate of 19,420,124 shares of our Series C preferred stock at a purchase price of $4.3769 per share for an aggregate amount of $85.0 million.

The following table summarizes purchases of our Series C preferred stock by related persons:

Stockholder Shares of

Entities affiliated with Versant Venture Capital (1)

5,186,048 $ 22,698,813

New Enterprise Associates (2)

1,422,862 $ 6,227,725

Entities affiliated with RA Capital Management (3)

853,716 $ 3,736,630

Entities affiliated with Boxer Capital, LLC (4)

3,998,263 $ 17,499,997

(1) Represents 2,444,382 shares of Series C preferred stock purchased by Versant Vantage I, L.P., 1,370,833 shares of Series C preferred stock purchased by Versant Venture Capital VI, L.P., 1,055,960 shares of Series C preferred stock purchased by Versant Voyageurs I, L.P.

and 314,873 shares of Series C preferred stock purchased by Versant Voyageurs I Parallel, L.P.

Each of Bradley Bolzon and Alexander Mayweg serves as a director of the Company and is an affiliate of Versant Venture Capital, of which Versant Vantage I, L.P., Versant Venture Capital VI, L.P., Versant Voyageurs I, L.P.

and Versant Voyageurs I Parallel, L.P.

are affiliated funds.

Entities affiliated with Versant Venture Capital collectively hold more than 5% of our voting securities.

(2) Ali Behbahani serves as a director of the Company and is an affiliate of New Enterprise Associates, of which New Enterprise Associates 16, L.P.

is an affiliated fund.

Entities affiliated with New Enterprise Associates collectively hold more than 5% of our voting securities.

(3) Represents 548,224 shares of Series C preferred stock purchased by RA Capital Healthcare Fund, LP, 213,429 shares of Series C preferred stock purchased by RA Capital Nexus Fund, L.P.

and 92,063 shares of Series C preferred stock purchased by Blackwell Partners LLC—Series A.

Rajeev Shah serves as a director of the Company and is an affiliate of RA Capital Management, of which RA Capital Healthcare Fund, LP, RA Capital Nexus Fund, L.P.

and Blackwell Partners LLC—Series A are affiliated funds.

Entities affiliated with RA Capital Management collectively hold more than 5% of our voting securities.

(4) Represents 3,814,572 shares of Series C preferred stock purchased by Boxer Capital, LLC and 183,691 shares of Series C preferred stock purchased by MVA Investors, LLC.

Entities affiliated with Boxer Capital, LLC collectively hold more than 5% of our voting securities.

Initial Public Offering

On February 3, 2020, we completed the IPO of our common stock pursuant to which we issued and sold 12,174,263 shares of our common stock, including the exercise in full by the underwriters of their option to purchase up to 1,587,947 additional shares of common stock, at a public offering price of $19.00 per share.

The total underwriting discounts and commissions payable by us in connection with the offering were $16,191,770.

Agreement with Ridgeline Therapeutics

We entered into a services agreement with Ridgeline Therapeutics GmbH, or Ridgeline, in March 2017, amended in November 2017 and December 2018, or the Service Agreement.

Ridgeline is a discovery engine owned by Versant Ventures Capital.

Pursuant to the Service Agreement, Ridgeline provides us with certain services, including research and development and management and administration.

Ridgeline also provides us with the services of a team of scientists.

In 2019, in connection with the services provided, we paid Ridgeline $950,000 a month, which was reconciled on a quarterly basis with the actual expenses incurred by Ridgeline on our behalf and a corresponding reconciling payment was made by us to (or received by us from) Ridgeline each quarter.

We paid Ridgeline $10.4 million and $2.7 million in the years ended December 31, 2019 and 2018.

On March 20, 2020, we entered in to a third amendment to the Service Agreement.

For more information, see Item 9B of this Annual Report.

Each of Bradley Bolzon and Alexander Mayweg serves as a director of the Company and is an affiliate of Versant Venture Capital, of which Versant Venture Capital VI, L.P., Versant Voyageurs I, L.P., and Versant Voyageurs I Parallel, L.P.

are affiliated funds.

Entities affiliated with Versant Venture Capital collectively hold more than 5% of our voting securities.

See “Business—Our Collaboration with Ridgeline Therapeutics.”

Stock option grants to executive officers

We have granted stock options to our named executive officers as more fully described in the section entitled “Executive Compensation.”

Indemnification agreements

In connection with the IPO, we have entered into new agreements to indemnify our directors and executive officers.

These agreements will, among other things, require us to indemnify these individuals for certain expenses (including attorneys’ fees), judgments, fines and settlement amounts reasonably incurred by such person in any action or proceeding, including any action by or in our right, on account of any services undertaken by such person on behalf of our company or that person’s status as a member of our board of directors to the maximum extent allowed under Delaware law.

Director independence

Our common stock was approved for listing on The Nasdaq Global Select Market.

Under the Nasdaq listing rules, independent directors must comprise a majority of a listed company’s board of directors within twelve months from the date of listing.

In addition, the Nasdaq listing rules require that, subject to specified exceptions, each member of a listed company’s audit, compensation and nominating and governance committees be independent within twelve months from the date of listing.

Audit committee members must also satisfy additional independence criteria, including those set forth in Rule 10A-3 under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and compensation committee members must also satisfy the independence criteria set forth in Rule 10C-1 under the Exchange Act.

Under Nasdaq listing rules, a director will only qualify as an “independent director” if, in the opinion of that company’s board of directors, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.

In order to be considered independent for purposes of Rule 10A-3 under the Exchange Act, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the board of directors, or any other board committee:

(1) accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries, other than compensation for board service;

or (2) be an affiliated person of the listed company or any of its subsidiaries.

In order to be considered independent for purposes of Rule 10C-1, the board of directors must consider, for each member of a compensation committee of a listed company, all factors specifically relevant to determining whether a director has a relationship to such company which is material to that director’s ability to be independent from management in connection with the duties of a compensation committee member, including, but not limited to:

the source of compensation of the director, including any consulting advisory or other compensatory fee paid by such company to the director, and whether the director is affiliated with the company or any of its subsidiaries or affiliates.

In December 2019, our board of directors undertook a review of the composition of our board of directors and its committees and the independence of each director.

Based upon information requested from and provided by each director concerning his background, employment and affiliations, including family relationships, our board of directors has determined that all members of our board of directors, except David M.

Epstein, Alexander Mayweg and Bradley Bolzon, are independent directors, including for purposes of Nasdaq and the SEC rules.

In making that determination, our board of directors considered the relationships that each director has with us and all other facts and circumstances the board of directors deemed relevant in determining independence, including the potential deemed beneficial ownership of our capital stock by each director, including non-employee directors that are affiliated with certain of our major stockholders.

We expect that the composition and functioning of our board of directors and each of our committees complies with all applicable requirements of Nasdaq and the rules and regulations of the SEC.

There are no family relationships among any of our directors or executive officers.

Audit committee

Our audit committee consists of Garry E.

Menzel, Ali Behbahani and Rajeev Shah and is chaired by Garry E.

The functions of the audit committee include:

• appointing, approving the compensation of, and assessing the independence of our independent registered public accounting firm;

• pre-approving auditing and permissible non-audit services, and the terms of such services, to be provided by our independent registered public accounting firm;

• reviewing the overall audit plan with our independent registered public accounting firm and members of management responsible for preparing our financial statements;

• reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements and related disclosures as well as critical accounting policies and practices used by us;

• coordinating the oversight and reviewing the adequacy of our internal control over financial reporting;

• establishing policies and procedures for the receipt and retention of accounting-related complaints and concerns;

• recommending based upon the audit committee’s review and discussions with management and our independent registered public accounting firm whether our audited financial statements shall be included in our Annual Report;

• monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial statements and accounting matters;

• preparing the audit committee report required by SEC rules to be included in our annual proxy statement;

• reviewing all related person transactions for potential conflict of interest situations and approving all such transactions;

• reviewing quarterly earnings releases.

All members of our audit committee meet the requirements for financial literacy under the applicable rules and regulations of the SEC and the Nasdaq listing rules.

Our board of directors has determined that all of the directors that comprise our audit committee satisfy the relevant independence requirements for service on the audit committee set forth in the rules of the SEC and the Nasdaq listing rules.

Both our independent registered public accounting firm and management periodically meet privately with our audit committee.

Compensation, nomination and corporate governance committee

Our compensation, nomination and corporate governance committee consists of Ali Behbahani, Garry E.

Menzel and Samarth Kulkarni, and is chaired by Ali Behbahani.

The functions of the compensation, nomination and corporate governance committee include:

• annually reviewing and recommending to the board of directors the corporate goals and objectives relevant to the compensation of our Chief Executive Officer;

• evaluating the performance of our Chief Executive Officer in light of such corporate goals and objectives and based on such evaluation (i) reviewing and determining the cash compensation of our Chief Executive Officer and (ii) reviewing and approving grants and awards to our Chief Executive Officer under equity-based plans;

• reviewing and approving the compensation of our other executive officers;

• reviewing and establishing our overall management compensation, philosophy and policy;

• overseeing and administering our compensation and similar plans;

• evaluating and assessing potential and current compensation advisors in accordance with the independence standards identified in the applicable Nasdaq listing rules;

• reviewing and approving our policies and procedures for the grant of equity-based awards;

• reviewing and recommending to the board of directors the compensation of our directors;

• preparing our compensation committee report if and when required by SEC rules;

• reviewing and discussing annually with management our “Compensation Discussion and Analysis,” if and when required, to be included in our annual proxy statement;

• reviewing and approving the retention or termination of any consulting firm or outside advisor to assist in the evaluation of compensation matters;

• developing and recommending to the board of directors criteria for board and committee membership;

• establishing procedures for identifying and evaluating board of director candidates, including nominees recommended by stockholders;

• reviewing the composition of the board of directors to ensure that it is composed of members containing the appropriate skills and expertise to advise us;

• identifying individuals qualified to become members of the board of directors;

• recommending to the board of directors the persons to be nominated for election as directors and to each of the board’s committees;

• developing and recommending to the board of directors a code of business conduct and ethics and a set of corporate governance guidelines;

• overseeing the evaluation of our board of directors and management.

Each member of our compensation, nomination and corporate governance committee will be a non-employee director, as defined in Rule 16b-3 promulgated under the Exchange Act.

Our board of directors may from time to time establish other committees.

Principal Accounting Fees and Services

The firm of PricewaterhouseCoopers LLP, independent registered public accounting firm, has been selected by the audit committee as auditors for Black Diamond for the fiscal years ending December 31, 2019 and December 31, 2018.

PricewaterhouseCoopers LLP has served as the independent registered public accounting firm for Black Diamond since 2019.

The audit committee is solely responsible for selecting Black Diamond’s independent registered public accounting firm and has appointed PricewaterhouseCoopers LLP as auditors for Black Diamond for the fiscal year ending December 31, 2020.

Stockholder approval is not required to appoint PricewaterhouseCoopers LLP as Black Diamond’s independent registered public accounting firm.

Independent Registered Public Accounting Firm Fees

The following is a summary and description of fees incurred by PricewaterhouseCoopers LLP for the fiscal years ended December 31, 2019 and 2018.

Audit fees (1)

$ 1,500,000 $ 40,000

Tax fees — 32,000

All other fees (2)

Total fees $ 1,502,700 $ 72,000

(1) Audit fees consist of fees for the audit of our annual financial statements, the review of our interim financial statements, and services provided in connection with the registration statement for the initial public offering of our common stock, which was completed in February 2020.

(2) Consists of license fees for accounting research software.

Audit Committee Pre-approval Policy and Procedures

Our audit committee has adopted policies and procedures relating to the approval of all audit and non-audit services that are to be performed by our independent registered public accounting firm.

This policy provides that we will not engage our independent registered public accounting firm to render audit or non-audit services unless the service is specifically approved in advance by our audit committee or the engagement is entered into pursuant to the pre-approval procedure described below.

From time to time, our audit committee may pre-approve specified types of services that are expected to be provided to us by our independent registered public accounting firm during the next 12 months.

Any such pre-approval details the particular service or type of services to be provided and is also generally subject to a maximum dollar amount.

During our 2019 and 2018 fiscal years, no services were provided to us by PricewaterhouseCoopers LLP other than in accordance with the pre-approval policies and procedures described above.

Exhibits and Financial Statement Schedules

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Exhibit Index

Form of Fourth Amended and Restated Certificate of Incorporation of the Registrant, as currently in effect (incorporated by reference to Exhibit 3.3 of the Registrant’s Registration Statement on Form S-1 (File No.

333-235789) filed on January 3, 2020)

Form of Amended and Restated By-laws of the Registrant, as currently in effect (incorporated by reference to Exhibit 3.5 of the Registrant’s Registration Statement on Form S-1 (File No.

333-235789) filed on January 3, 2020)

Amended and Restated Investors’ Rights Agreement among the Registrant and certain of its stockholders, dated November 25, 2019 (incorporated by reference to Exhibit 4.1 of the Registrant’s Registration Statement on Form S-1 (File No.

333-235789) filed on January 3, 2020)

Form of Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.2 of the Registrant’s Registration Statement on Form S-1 (File No.

Fourth Amended and Restated Certificate of Incorporation of the Registrant, as currently in effect (incorporated by reference to Exhibit 3.1 of the Registrant’s Current Report on Form 8-K (File No.

001-39200) filed on February 3, 2020 )

Amended and Restated By-laws of the Registrant, as currently in effect (incorporated by reference to Exhibit 3.2 of the Registrant’s Current Report on Form 8-K (File No.

001-39200) filed on February 3, 2020)

Second Amended and Restated Investors’ Rights Agreement among the Registrant and certain of its stockholders, dated November 25, 2019 (incorporated by reference to Exhibit 4.1 of the Registrant’s Registration Statement on Form S-1 (File No.

333-235789) filed on January 3, 2020)

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333-235789) filed on January 3, 2020)

4.4* Description of Securities

4.3 Description of Securities (incorporated by reference to Exhibit 4.4 of the Registrant’s Annual Report on Form 10-K (File No.

001-39200) filed on March 24, 2020)

2017 Employee, Director and Consultant Equity Incentive Plan, as amended and restated, and forms of award agreements thereunder (incorporated by reference to Exhibit 10.1 of the Registrant’s Registration Statement on Form S-1 (File No.

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333-235789) filed on January 3, 2020)

10.11 Lease Agreement, dated as of March 27, 2019, by and between MIT 139 Main Street Leasehold LLC and the Registrant (incorporated by reference to Exhibit 10.11 of the Registrant’s Registration Statement on Form S-1 (File No.

333-235789) filed on January 3, 2020)

10.12† Services Agreement, dated as of March 15, 2017, by and between Ridgeline Therapeutics GmbH and the Registrant, as amended (incorporated by reference to Exhibit 10.12 of the Registrant’s Registration Statement on Form S-1 (File No.

333-235789) filed on January 3, 2020)

10.13† Amendment No.

3 to Services Agreement, dated as of March 20, 2020, by and between Ridgeline Therapeutics GmbH and the Registrant.

10.11#* Employment Agreement between the Registrant and Rachel Humphrey

10.12+ Lease Agreement, dated as of July 24, 2020, by and between RREEF America REIT II Corp.

PPP and the Registrant (incorporated by reference to Exhibit 10.1 of the Registrant’s Quarterly Report on Form 10-Q (File No.

001-39200) filed on August 11, 2020 )

21.1 Subsidiaries of the Registrant (incorporated by reference to Exhibit 21.1 of the Registrant’s Registration Statement on Form S-1 (File No.

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Indicates a management contract or any compensatory plan, contract or arrangement.

+ Non-material schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K.

The Company hereby undertakes to furnish supplementally copies of any of the omitted schedules and exhibits upon request by the Securities and Exchange Commission.

Filed herewith.

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Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent specifically incorporated by reference into such filing.

† Portions of this exhibit (indicated by asterisks) will be omitted in accordance with the rules of the Securities and Exchange Commission.

Form 10-K Summary

The company has elected not to include summary information.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Black Diamond Therapeutics, Inc.

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Epstein and Brent Hatzis-Schoch, and each of them, with full power of substitution and re-substitution and full power to act without the other, as his or her true and lawful attorney-in-fact and agent to act in his or her name, place and stead and to execute in the name and on behalf of each person, individually and in each capacity stated below, and to file any and all amendments to this Annual Report on Form 10-K and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing, ratifying and confirming all that said attorneys-in-fact and agents or any of them or their or his substitute or substitutes may lawfully do or cause to be done by virtue thereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on the 24th day of March, 2020.

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the registrant and in the capacities indicated on the 25th day of March, 2021.

Signature Title

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Thomas Leggett

/s/ Bradley Bolzon Chairman and Director

/s/ Robert A.

Ingram Chairman and Director

/s/ Bradley Bolzon Director

Bradley Bolzon

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/s/ Rajeev Shah Director

/s/ Kapil Dhingra Director

Kapil Dhingra

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 9A. Controls and Procedures