Cabaletta Bio, Inc. 10-K

Item 9A. Controls and Procedures. Evaluation of Disclosure Controls and Procedures The Company has established disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) designed to ensure that information required to be disclosed in the reports that the Company files or submits under the Securities Exchange Act of 1934, as amended, or Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and is accumulated and communicated to management, including the principal executive officer (our Chief Executive Officer) and principal financial officer (our Chief Financial Officer), to allow timely decisions regarding required disclosure. In addition, the design of disclosure controls and procedures 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. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated, as of December 31, 2025, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Our disclosure controls and procedures have been designed to provide reasonable assurance of achieving their objectives. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective at the reasonable assurance level as of December 31, 2025. Management’s Annual Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance of the reliability of financial reporting and of the preparation of consolidated financial statements for external reporting purposes, in accordance with U.S. generally accepted accounting principles. Internal control over financial reporting includes policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and disposition of assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with the authorization of its management and directors; and (3) provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on its consolidated financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of the 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 and procedures included in such controls may deteriorate. Our management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2025. In making this assessment, management used the criteria established by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control - Integrated Framework (2013). These criteria are in the areas of control environment, risk assessment, control activities, information and communication, and monitoring. Management’s assessment included extensive documentation, evaluating and testing the design and operating effectiveness of its internal controls over financial reporting. Based on management’s processes and assessment, as described above, management has concluded that, as of December 31, 2025, our internal control over financial reporting was effective. Attestation Report of the Registered Public Accounting Firm 134 As a non-accelerated filer, we are not required to provide an attestation report of our independent registered public accounting firm on the effectiveness of our internal control over financial reporting. 135 Changes in Internal Control over Financial Reporting There was no change in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) that occurred during the fiscal quarter ended December 31, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Item 9B. Other Information. Rule 10b5-1 Trading Plans During the fiscal quarter ended on December 31, 2025, none of our directors and officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted , modified or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408(a) of Regulation S-K. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. Not applicable. 136 PART III Item 10. Directors, Executive Officers and Corporate Governance. Except as set forth below, the information required by this item is incorporated by reference from our definitive Proxy Statement to be filed with the SEC in connection with our 2026 Annual Meeting of Stockholders within 120 days after the end of the fiscal year ended December 31, 2025. We have adopted a Code of Business Conduct and Ethics that applies to all of our directors, officers and employees, including our principal executive officer and principal financial officer. The Code of Business Conduct and Ethics is posted on our website at http://investors.cabalettabio.com/corporate-governance/governance-highlights . We intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding an amendment to, or waiver from, a provision of this Code of Business Conduct and Ethics by posting such information on our website, at the address and location specified above and, to the extent required by the listing standards of The Nasdaq Global Select Market, by filing a Current Report on Form 8-K with the SEC, disclosing such information. Item 11. Executive Compensation. The information required by this Item 11 will be included in our definitive proxy statement to be filed with the SEC with respect to our 2026 Annual Meeting of Stockholders within 120 days after the end of the fiscal year ended December 31, 2025 and is incorporated herein by reference. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. The information required by this Item 12 will be included in our definitive proxy statement to be filed with the SEC with respect to our 2026 Annual Meeting of Stockholders within 120 days after the end of the fiscal year ended December 31, 2025 and is incorporated herein by reference. Item 13. Certain Relationships and Related Transactions, and Director Independence. The information required by this Item 13 will be included in our definitive proxy statement to be filed with the SEC with respect to our 2026 Annual Meeting of Stockholders within 120 days after the end of the fiscal year ended December 31, 2025 and is incorporated herein by reference. Item 14. Principal Accounting Fees and Services. The information required by this Item 14 will be included in our definitive proxy statement to be filed with the SEC with respect to our 2026 Annual Meeting of Stockholders within 120 days after the end of the fiscal year ended December 31, 2025 and is incorporated herein by reference. Our independent public accounting firm is Ernst & Young, Philadelphia, PA, PCAOB Auditor ID 42 . 137 PART IV Item 15. Exhibits, Consolidated Financ ial Statement Schedules. (a) The following documents are filed as part of this Annual Report on Form 10-K: (1) Consolidated Financial Statements: Page Report of Independent Registered Public Accounting Firm F- 2 Consolidated Balance Sheets as of December 31, 2025 and 2024 F- 5 Consolidated Statements of Operations and Comprehensive Loss for the Years Ended December 31, 2025 and 2024 F- 6 Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2025 and 2024 F- 7 Consolidated Statements of Cash Flows for the Years Ended December 31, 2025 and 2024 F- 8 Notes to Consolidated Financial Statements F- 9 (2) Consolidated Financial Statement Schedules: All consolidated 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. (3) Exhibits. 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. The exhibits listed in the Exhibit Index are incorporated by reference herein. Item 16. Form 10-K Summary None. 138 INDEX TO FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm F- 2 Consolidated Balance Sheets as of December 31, 2025 and 2024 F- 5 Consolidated Statements of Operations and Comprehensive Loss for the Years Ended December 31, 2025 and 2024 F- 6 Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2025 and 2024 F- 7 Consolidated Statements of Cash Flows for the Years Ended December 31, 2025 and 2024 F- 8 Notes to Consolidated Financial Statements F- 9 F- 1 Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of Cabaletta Bio, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Cabaletta Bio, Inc. (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, stockholders’ equity and cash flows for each of the two years in the period ended December 31, 2025, 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, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles. The Company's Ability to Continue as a Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has suffered recurring losses from operations and has stated that substantial doubt exists about the Company’s ability to continue as a going concern. Management's evaluation of the events and conditions and management’s plans regarding these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion 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. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. F- 2 Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of critical audit matters 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 matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Accounting for Accrued Clinical Trial Expenses Description of the Matter As disclosed in Note 2 to the consolidated financial statements, the Company expenses research and development costs as incurred, which include costs relating to clinical trial activities. The Company’s accrued clinical trial expenses are based on factors such as estimates of the work completed in accordance with agreements established with a contract research organization. As disclosed in Note 5 to the consolidated financial statements, the Company’s total accrued expenses and other current liabilities related to clinical trial research and development services were $5.3 million at December 31, 2025. Auditing the Company’s accrued clinical trial expenses required subjective auditor judgement due to the estimation required by management in determining the services provided but not yet invoiced. Specifically, the amount of accrued clinical trial expenses recognized is sensitive to the availability of information to make the estimate, including the estimate of the period over which services will be performed, the associated cost of such services, and the level of services performed and progress in the period for which the Company has not yet received an invoice How We Addressed the Matter in Our Audit To test the accrued clinical trial expenses our audit procedures included, among others, reviewing a sample of agreements with the service providers to corroborate key financial and contractual terms, and testing the accuracy and completeness of the underlying data used in the accrual expense computations. We also evaluated management’s estimates of the progress of a sample of clinical trial activities by making inquiries of the Company’s operations personnel that oversee the clinical trials and confirming information directly with the contract research organization. To evaluate the completeness of the accruals, we also examined subsequent invoices from the service providers and cash disbursements to the service providers, to the extent such invoices were received, or payments were made prior to the date that the consolidated financial statements were issued. Accounting for Common Stock Warrants Description of the Matter As discussed in Note 10 to the consolidated financial statements, in June 2025, concurrent with the issuance of common stock and pre-funded warrants, the Company issued a total of 53,090,190 common stock warrants. The common stock warrants were classified as a component of permanent stockholders’ equity within additional paid-in capital. Auditing management’s evaluation of whether the common stock warrants required classification as a liability or equity is especially challenging and required significant audit effort and judgment due to the complex assessment of provisions within the warrants under authoritative guidance. How We Addressed the Matter in Our Audit To test the classification of the common stock warrants, our audit procedures included, among others, reviewing terms and conditions of the common stock warrant agreements, evaluating management's application of authoritative accounting guidance and related judgments, and testing the accuracy of underlying data supporting management’s assertions. We involved our F- 3 internal accounting subject matter resources to assist in evaluating the Company’s assessment and judgments applied in its evaluation of the classification for the warrants. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2018. Philadelphia, Pennsylvania March 23, 2026 F- 4 CABALETTA BIO, INC. Consolidated Balance Sheets (in thousands, except share and per share amounts) Year Ended December 31, 2025 2024 Assets Current assets: Cash and cash equivalents $ 82,982 $ 163,962 Short-term investments 50,617 — Prepaid expenses and other current assets 5,272 2,713 Total current assets 138,871 166,675 Property and equipment, net 1,922 2,743 Finance lease right-of-use assets 15,700 7,020 Operating lease right-of-use assets 3,431 6,315 Other assets 5,159 2,293 Total assets $ 165,083 $ 185,046 Liabilities and stockholders’ equity Current liabilities: Accounts payable $ 6,636 $ 4,923 Accrued and other current liabilities 19,298 12,188 Finance lease liabilities, current portion 20,758 5,989 Operating lease liabilities, current portion 3,461 3,986 Total current liabilities 50,153 27,086 Finance lease liabilities, net of current portion 2,879 3,241 Operating lease liabilities, net of current portion — 2,384 Total liabilities 53,032 32,711 Commitments and contingencies (see Notes 6 and 7) Stockholders’ equity: Preferred stock, $ 0.00001 par value: 10,000,000 shares authorized as of December 31, 2025 and December 31, 2024; no shares issued or outstanding at December 31, 2025 and December 31, 2024 — — Voting and non-voting common stock, $ 0.00001 par value: 300,000,000 ( 293,590,481 voting and 6,409,519 non-voting) shares authorized as of December 31, 2025 and 150,000,000 ( 143,590,481 voting and 6,409,519 non-voting) shares authorized as of December 31, 2024; 100,479,323 voting shares issued and outstanding as of December 31, 2025 and 50,743,101 voting shares issued and outstanding as of December 31, 2024 1 1 Additional paid-in capital 628,982 501,435 Accumulated other comprehensive income 25 — Accumulated deficit ( 516,957 ) ( 349,101 ) Total stockholders’ equity 112,051 152,335 Total liabilities and stockholders’ equity $ 165,083 $ 185,046 The accompanying notes are an integral part of these consolidated financial statements. F- 5 CABALETTA BIO, INC. Consolidated Statements of Operations and Comprehensive Loss (in thousands, except share and per share amounts) Year Ended December 31, 2025 2024 Operating expenses: Research and development $ 142,674 $ 97,203 General and administrative 29,567 27,938 Total operating expenses 172,241 125,141 Loss from operations ( 172,241 ) ( 125,141 ) Other income (expense): Interest income 6,031 10,025 Interest expense ( 2,004 ) ( 748 ) Other income, net 358 — Net loss $ ( 167,856 ) $ ( 115,864 ) Other comprehensive income: Net unrealized gain (loss) on available-for-sale investments, net of tax 25 ( 39 ) Net comprehensive loss $ ( 167,831 ) $ ( 115,903 ) Net loss per share of voting and non-voting common stock, basic and diluted $ ( 2.10 ) $ ( 2.34 ) The accompanying notes are an integral part of these consolidated financial statements. F- 6 CABALETTA BIO, INC. Consolidated Statements of Stockholders’ Equity (in thousands, except share amounts) Common Stock Shares Amount Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Stockholders’ Equity Balance—December 31, 2023 47,823,232 $ — $ 469,396 $ 39 $ ( 233,237 ) $ 236,198 Issuance of common stock, net of issuance costs of $ 252 1,483,070 1 10,875 — — 10,876 Issuance of common stock in connection with exercise of stock options 210,695 — 1,430 — — 1,430 Issuance of common stock under employee stock purchase plan 58,056 — 269 — — 269 Issuance of common stock upon exercise of pre-funded warrants 1,168,048 — — — — — Stock-based compensation — — 19,465 — — 19,465 Net unrealized losses on available-for-sale securities — — — ( 39 ) — ( 39 ) Net loss — — — — ( 115,864 ) ( 115,864 ) Balance—December 31, 2024 50,743,101 $ 1 $ 501,435 $ — $ ( 349,101 ) $ 152,335 Issuance of common stock, warrants and pre-funded warrants, net of issuance costs of $ 6,442 39,200,000 — 93,558 — — 93,558 Issuance of common stock from ATM offering, net of sales agent commission and fees 5,545,041 — 12,745 — — 12,745 Issuance of common stock upon exercise of pre-funded warrants 4,799,971 — — — — — Issuance of common stock under employee stock purchase plan 177,876 — 291 — — 291 Issuance of common stock in connection with exercise of stock options 13,334 — 14 — — 14 Stock-based compensation — — 20,939 — — 20,939 Net unrealized gains on available-for-sale securities — — — 25 — 25 Net loss — — — — ( 167,856 ) ( 167,856 ) Balance—December 31, 2025 100,479,323 $ 1 $ 628,982 $ 25 $ ( 516,957 ) $ 112,051 The accompanying notes are an integral part of these consolidated financial statements. F- 7 CABALETTA BIO, INC. Consolidated Statements of Cash Flows (in thousands) Year Ended December 31, 2025 2024 Cash flows from operating activities: Net loss $ ( 167,856 ) $ ( 115,864 ) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation 20,939 19,465 Depreciation 1,646 1,711 Non-cash finance lease expense 11,697 3,102 Non-cash operating lease expense 3,671 2,838 Accretion of operating lease liabilities 532 405 Amortization of discount on investments ( 1,555 ) ( 1,528 ) Loss on foreign currency exchange rates 225 38 Changes in operating assets and liabilities: Prepaid expenses and other current assets ( 2,559 ) 528 Other assets ( 2,866 ) ( 584 ) Accounts payable 1,550 1,011 Accrued and other current liabilities 7,432 3,947 Lease liabilities ( 4,227 ) ( 3,291 ) Accrued interest payable under finance lease 291 — Net cash used in operating activities ( 131,080 ) ( 88,222 ) Cash flows from investing activities: Purchases of property and equipment ( 1,229 ) ( 2,211 ) Purchases of investments ( 99,037 ) — Proceeds from maturities of investments 50,000 49,500 Net cash (used in) provided by investing activities ( 50,266 ) 47,289 Cash flows from financing activities: Proceeds from the issuance of common stock, warrants and pre-funded warrants, net of issuance costs 93,558 — Issuance of common stock from ATM offering, net of sales agent commission and fees 12,745 10,875 Proceeds from issuance of common stock under employee stock purchase plan 291 269 Proceeds from issuance of common stock in connection with the exercise of stock options 14 1,430 Principal payments on finance leases ( 6,261 ) ( 897 ) Net cash provided by financing activities 100,347 11,677 Effect of exchange rate changes on cash and cash equivalents 19 ( 20 ) Net decrease in cash and cash equivalents ( 80,980 ) ( 29,276 ) Cash and cash equivalents—beginning of period 163,962 193,238 Cash and cash equivalents—end of period $ 82,982 $ 163,962 Supplemental disclosures Cash paid for interest $ 1,713 $ 748 Property and equipment purchases included in accounts payable and accrued expenses $ — $ 404 Right-of-use assets obtained in exchange for finance lease obligations $ 21,071 $ 10,963 Right-of-use assets obtained in exchange for operating lease obligations $ 787 $ 4,242 The accompanying notes are an integral part of these consolidated financial statements. F- 8 CABALETTA BIO, INC. Notes to the Consolidated Financial Statements (in thousands, except share and per share amounts) 1. Basis of Presentation Cabaletta Bio, Inc. (the Company or Cabaletta) was incorporated in April 2017 in the State of Delaware as Tycho Therapeutics, Inc. and, in August 2018, changed its name to Cabaletta Bio, Inc. The consolidated financial statements include the accounts of Cabaletta and its wholly owned subsidiaries: Cabaletta Bio GmbH and Cabaletta Bio (Germany) GmbH. The Company is headquartered in Philadelphia, Pennsylvania. Cabaletta is a clinical-stage biotechnology company focused on the discovery and development of engineered T cell therapies for autoimmune diseases. Principal operations commenced in April 2018. Risks and Uncertainties The Company does not expect to generate revenue from sales of engineered T cell therapies for autoimmune diseases or any other revenue unless and until the Company completes preclinical and clinical development and obtains regulatory approval for one or more product candidates. If the Company seeks to obtain regulatory approval for any of its product candidates, the Company expects to incur significant commercialization expenses. The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, new technological innovations, protection of proprietary technology, dependence on key personnel, compliance with government regulations and the need to obtain additional financing. As a result, the Company is unable to predict the timing or amount of increased expenses or when or if the Company will be able to achieve or maintain profitability. Further, the Company is dependent on third parties for certain research and development activities, including manufacturing services (Note 6 and Note 7). Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval, prior to commercialization. Even if the Company is able to generate revenues from the sale of its product candidates, if approved, it may not become profitable. If the Company fails to become profitable or is unable to sustain profitability on a continuing basis, then it may be unable to continue its operations at planned levels and be forced to reduce its operations. Liquidity and Going Concern In accordance with Accounting Standards Codification (“ASC”) 205-40, Going Concern, ("ASC 205-40") the Company evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern. The Company has sustained annual operating losses since inception and expects to continue to generate operating losses for the foreseeable future. As of December 31, 2025, the Company has incurred an accumulated deficit of $ 516,957 and has cash, cash equivalents and investments of $ 133,599 . The Company’s ultimate success depends on the outcome of its research and development activities. Management expects to incur additional losses in the future as it continues its research and development and will need to raise additional capital to fully implement its business plan and to fund its operations. The Company intends to raise such additional capital through a combination of equity offerings, debt financings, government funding arrangements, strategic alliances or other sources. However, if such financing is not available at adequate levels and on a timely basis, or such agreements are not available on favorable terms, or at all, as and when needed, the Company will need to reevaluate its operating plan and may be required to delay or discontinue the development of one or more of its product candidates or operational initiatives. Based on the Company’s current operating plan, there is substantial doubt about the Company’s ability to continue as a going concern for at least twelve months from the issuance date of this Annual Report on Form 10-K, and the Company will need to obtain additional funding. The Company's cash forecast contains estimates and assumptions based on success of ongoing clinical trials, and management cannot predict the amount or timing of all expenditures with certainty. Accordingly, the Company has concluded that substantial doubt exists about the Company’s ability to continue as a going concern. The accompanying financial statements have been F- 9 prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. 2. Summary of Significant Accounting Policies Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States (GAAP) and under the rules and regulations of the U.S. Securities and Exchange Commission (SEC). All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. Significant estimates and assumptions made in the accompanying consolidated financial statements include but are not limited to advance payments and accruals related to the Company’s research and development expenses . The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could differ from those estimates. Off-Balance Sheet Risk and Concentrations of Credit Risk Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist of cash and cash equivalents, which are invested in U.S. treasury-based money market funds, and available-for-sale debt securities, which are invested in U.S. treasury securities. A portion of the Company’s cash is maintained at federally insured financial institutions, and account balances may at times exceed federally insured limits. The Company has not experienced any losses in such accounts and management believes that the Company is not exposed to significant credit risk. The Company has no off‑balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. The Company considers all highly liquid investments purchased with original maturities of three months or less from the purchase date to be cash equivalents. Cash equivalents consist primarily of amounts invested in money market accounts and U.S. treasury securities. Investments Investments are available-for-sale and carried at estimated fair value. The Company’s valuations of available-for-sale debt securities are generally derived from independent pricing services based upon quoted prices in active markets for similar securities, with prices adjusted for yield and number of days to maturity, or based on industry models using data inputs, such as interest rates and prices that can be directly observed or corroborated in active markets. Management determines the appropriate classification of its investments in debt securities at the time of purchase and at the end of each reporting period. Investments with original maturities beyond three months at the date of purchase and which mature at, or less than, twelve months from the balance sheet date are classified as current. Unrealized gains and losses are excluded from earnings and are reported as a component of comprehensive income. The Company periodically evaluates whether declines in fair values of its available-for-sale securities below their book value are other-than-temporary. This evaluation consists of several qualitative and quantitative factors including the severity and duration of the unrealized loss as well as the Company’s ability and intent to hold the available-for-sale security until a forecasted recovery occurs. Additionally, the Company assesses whether it has plans to sell the security or if more likely than not it will be required to sell any available-for-sale securities before recovery of its amortized cost basis. Realized gains and losses and declines in fair value judged to be other-than-temporary, if any, on available-for-sale securities are included in interest and other income, net. The cost of investments sold is based on the specific-identification method. Interest income on investments as well as amortization of discount or premium is included in interest income. F- 10 Property, Plant and Equipment Property, plant and equipment are recorded at cost less accumulated depreciation. Cost includes the acquisition costs and all costs necessary to bring the asset to the location and working condition necessary for its intended use. Depreciation expense is recognized using the straight-line method over the estimated useful life of each asset. Upon retirement or sale, the cost of assets disposed of and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the accompanying statements of operations. Expenditures for normal, recurring or periodic repairs and maintenance related to property and equipment are charged to expense as incurred. The cost for planned major maintenance activities, including the related acquisition or construction of assets, is capitalized if it will result in future economic benefits. Estimated useful lives for property and equipment are as follows: Property and equipment Estimated useful life Laboratory equipment Three years Furniture and fixtures Three years Computer equipment Three years Leasehold improvements Lesser of estimated useful life or remaining lease term Fair Value Measurement Assets and liabilities recorded at fair value on a recurring basis in the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair values. Fair value is defined as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The authoritative guidance on fair value measurements establishes a three-tier fair value hierarchy for disclosure of fair value measurements as follows: Level 1—Observable inputs such as unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2—Inputs (other than quoted prices included in Level 1) that are either directly or indirectly observable for the asset or liability. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Leases The Company has leases related to its facilities used for offices and laboratory space, which are classified as operating leases as well as leases related to its manufacturing arrangements, which are classified as finance leases. At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease and its classification based on the unique facts and circumstances present in the arrangement. Leases with a term greater than one year are recognized on the balance sheet as right-of-use assets and current and non-current lease liabilities, as applicable. Lease liabilities and their corresponding right-of-use assets are initially recorded based on the present value of lease payments over the expected remaining lease term. Certain adjustments to the right-of-use asset may be required for items such as incentives received. The interest rate implicit in lease contracts is typically not readily determinable. As a result, the Company utilizes its incremental borrowing rate to discount lease payments. Subsequent to the initial measurement, the Company will continue to account for: • the lease liability at the net present value using the incremental borrowing rate that was in effect as of the lease commencement, lease modification, or transition date, and; • the finance lease and operating lease expense on a straight line basis. F- 11 Leases with terms of 12 months or less are considered short-term leases and right-of-use assets and lease obligations are not recognized. Payments associated with short-term leases are expensed on a straight-line basis over the lease term. In accordance with ASC 842, components of a lease should be split into three categories: lease components, non-lease components and non-components. The fixed and in-substance fixed contract consideration (including any consideration related to non-components) must be allocated based on the respective relative fair values to the lease components and non-lease components. Entities may elect not to separate lease and non-lease components. Rather, entities would account for each lease component and related non-lease component together as a single lease component. The Company has elected to aggregate all lease and non-lease components for each class of underlying assets into a single lease component for real-estate leases and embedded manufacturing arrangements. ASC 842 allows for the use of judgment in determining whether the assumed lease term is for a major part of the remaining economic life of the underlying asset and whether the present value of lease payments represents substantially all of the fair value of the underlying asset. The Company applies the guidance in ASC 842-10-55-2 to assist in determining lease classification across its leases. Research and Development Expenses Research and development costs include costs incurred for internal and external research and development activities and are expensed as incurred in the accompanying statements of operations. Research and development costs consist of salaries and benefits, including associated stock-based compensation, and laboratory supplies and facility costs, as well as fees paid to entities that conduct certain research and development and clinical trial activities on the Company’s behalf. The Company records accrued liabilities for estimated costs of research and development activities conducted by service providers, which include preclinical studies, contract manufacturing activities and clinical trial activities. The Company records the estimated costs of research and development activities based upon the estimated amount of services provided and in accordance with agreements established with service providers and includes these costs in accrued and other current liabilities in the accompanying balance sheets and within research and development expense in the accompanying statements of operations. Non-refundable advance payments made for goods or services that will be used or rendered for future research and development activities are deferred and capitalized and recognized as expense as the goods are received or the related services are rendered. The Company makes significant judgments and estimates in determining the accrued liabilities and prepaid expenses in each reporting period. As actual costs become known, the Company adjusts its accrued liabilities and prepaid expenses. The Company has not experienced any material differences between accrued costs and actual costs incurred since its inception. Stock-based Compensation The Company measures its stock-based awards granted to employees and non-employees based on the estimated fair values of the awards on the respective grant dates. The Company uses the Black-Scholes option-pricing model (Black-Scholes) to estimate the fair value of its stock-based awards. The Company recognizes compensation expense for time-based awards on a straight-line basis over the requisite service period, which is generally the vesting period of the award. The Company accounts for forfeitures of stock option awards as they occur. Income Taxes The Company uses the asset and liability method of accounting for income taxes. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to temporary differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax base, as well as for net operating loss carryforwards and research and development credits, and are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets where, based upon the available evidence, the Company concludes that it is more-likely-than-not that the deferred tax assets will not be realized. In evaluating its ability to recover deferred tax assets, the Company considers all available positive and negative evidence, including its operating results, ongoing tax planning and forecasts of future taxable income on a F- 12 jurisdiction-by-jurisdiction basis. Because of the uncertainty of the realization of deferred tax assets, the Company has recorded a full valuation allowance against its deferred tax assets. Reserves are provided for tax benefits for which realization is uncertain. Such benefits are only recognized when the underlying tax position is considered more-likely-than-not to be sustained on examination by a taxing authority, assuming they possess full knowledge of the position and facts. Interest and penalties related to uncertain tax positions are recognized in the provision of income taxes; however, the Company currently has no interest or penalties related to uncertain income tax benefits. Net Loss Per Share The Company calculates basic and diluted net loss per share in conformity with the two-class method required for participating securities because the Company had both voting and non-voting common stock outstanding for a portion of 2024. The rights, including the liquidation and dividend rights, of the holders of the voting and non-voting common stock are identical, except with respect to voting. Each share of non-voting common stock may be converted at any time into one share of voting common stock at the option of its holder by providing written notice to the Company, subject to the limitations provided for in the amended and restated certificate of incorporation. As of December 31, 2024, no shares of non-voting common stock remain outstanding. Basic net loss per share attributable to common stockholders is computed by dividing the net loss by the weighted average number of shares of common stock, including any pre-funded warrants to purchase shares of common stock that may be outstanding. The undistributed loss for each year is allocated to common stockholders based on the contractual participation rights of the voting and non-voting common stock as if the losses for the year had been distributed. As the liquidation and dividend rights are identical, the undistributed losses are allocated on a proportionate basis. Diluted net loss per share attributable to common stockholders is computed under the if-converted method and assumes that all non-voting common stock has been converted to common stock. Since the Company was in a loss position for all periods presented, the effects of the other potentially dilutive securities are antidilutive. Segments Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (CODM) in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s CODM is its Chief Executive Officer (CEO). The Company has determined it operates in a single operating segment and has one reportable segment. Refer to Note 8 – Segment Reporting for further information related to our segment. Deferred Offering Costs The Company capitalizes certain legal, professional accounting and other third-party fees that are directly associated with in-process equity financings as deferred offering costs until such financings are consummated. After consummation of the equity financing, these costs are recorded as a reduction to the carrying value of stockholders’ equity as a reduction of additional paid-in capital or equity generated as a result of such offering. Should an in-process equity financing be abandoned, the deferred offering costs will be expensed immediately as a charge to operating expenses in the statements of operations and comprehensive loss. F- 13 Recently Adopted Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures . ASU 2023-09 enhances the transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information. The Company adopted this ASU for the annual period ended December 31, 2025 and the amendments have been applied retrospectively to all prior periods presented in the financial statements. Refer to Note 11 – Income Taxes for further information. Recently Issued Accounting Pronouncements In November 2024, the FASB issued ASU 2024-03, Income Statement (Subtopic 220-40): Reporting Comprehensive Income-Expense Disaggregation Disclosures. ASU 2024-03 requires enhanced disclosures about components of expense captions on the face of the income statement. This standard will be effective for fiscal years beginning after December 15, 2026. Early adoption is permitted. ASU 2024-03 applies on a prospective basis for periods beginning after the effective date. However, retrospective application to any or all prior periods presented is permitted. The Company is currently planning to adopt this guidance when effective and is assessing the impact of the adoption on the Company’s consolidated financial statements and accompanying footnotes. There have been no other new accounting pronouncements or changes to accounting pronouncements that, if adopted, would have or may have a material impact on the Company’s consolidated statements or disclosures. F- 14 3. Fair Value Measurements As of December 31, 2025 and 2024, the Company’s financial instruments included cash and cash equivalents, available-for-sale debt securities, accounts payable and accrued expenses. The carrying amounts for cash and cash equivalents, accounts payable and accrued expenses reported in the Company’s consolidated financial statements for these instruments approximate their respective fair values because of the short-term nature of these instruments. The following tables present information about the Company’s financial assets measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values: December 31, 2025 Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets Cash equivalents: Money market funds $ 81,470 $ 81,470 $ — $ — Short-term investments: U.S. Treasury securities 50,617 — 50,617 — Total $ 132,087 $ 81,470 $ 50,617 $ — December 31, 2024 Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets Cash equivalents: Money market funds $ 162,634 $ 162,634 $ — $ — Total $ 162,634 $ 162,634 $ — $ — Money market funds are measured at fair value on a recurring basis using quoted prices and are classified as Level 1 inputs. Investments are measured at fair value based on inputs other than quoted prices that are derived from observable market data and are classified as Level 2 inputs. For debt securities classified as available-for-sale investments, the Company records unrealized gains or losses resulting from changes in fair value between measurement dates as a component of other comprehensive income. The Company did not hold any available-for-sale securities as of December 31, 2024. December 31, 2025 Amortized Cost Gross Unrealized Gains Fair value Financial assets Cash $ 1,512 $ — $ 1,512 Money market funds 81,470 — 81,470 Included in cash and cash equivalents 82,982 — 82,982 U.S. Treasury securities - due in one year or less Included in short-term investments 50,592 25 50,617 Total $ 133,574 $ 25 $ 133,599 F- 15 4. Property, Plant and Equipment Property, plant and equipment consists of the following: December 31, 2025 2024 Laboratory equipment $ 8,488 $ 7,663 Furniture and fixtures 277 277 Computer equipment 196 196 Leasehold improvements 113 113 Total property, plant and equipment 9,074 8,249 Less: accumulated depreciation ( 7,152 ) ( 5,506 ) Property, plant and equipment, net $ 1,922 $ 2,743 Depreciation expense was $ 1,646 and $ 1,711 for the years ended December 31, 2025 and 2024 , respectively. 5. Accrued and Other Current Liabilities Accrued and other current liabilities consist of the following: December 31, 2025 2024 Compensation expense $ 9,716 $ 8,315 Clinical trial research and development services 5,335 1,236 Manufacturing and other research and development services 3,774 2,255 General and administrative services 393 342 Other 80 40 $ 19,298 $ 12,188 6. Collaborations, Licensing Agreements and Other Agreements Amended and Restated License Agreement with the Trustees of the University of Pennsylvania and Children’s Hospital of Philadelphia In August 2018, the Company entered into a license agreement with the University of Pennsylvania (Penn), as amended and restated in July 2019 to include the Children’s Hospital of Philadelphia (CHOP) as a party, and as amended in May 2020 and October 2021 (the License Agreement) pursuant to which the Company obtained (a) a non-exclusive, non-sublicensable worldwide license to certain of Penn’s intellectual property to conduct research, product development, clinical trials, cell manufacturing and other activities, and (b) an exclusive, worldwide, royalty-bearing right and license, with a right to sublicense, on a target-by-target basis, under certain of Penn’s intellectual property to make, use, sell, offer for sale, import, and otherwise commercialize products for the treatment of autoimmune and alloimmune diseases. Unless earlier terminated, the License Agreement expires on the expiration or abandonment or other termination of the last valid claim in Penn’s intellectual property licensed by the Company. The Company may terminate the License Agreement at any time for convenience upon 60 days' written notice. In the event of an uncured, material breach, Penn may terminate the License Agreement upon 60 days' written notice. Under the terms of the License Agreement, the Company was obligated to pay $ 2,000 annually for three years beginning August 2018 for funding to the laboratories of each of Drs. Milone and Payne. This was satisfied through completed sponsored research agreements with a total cost of $ 12,560 . During the term of the License Agreement until the first commercial sale of the first product, the Company is obligated to pay Penn a non-refundable, non-creditable annual license maintenance fee of $ 10 . In May 2020, the Company paid Penn an additional, non-refundable, non-creditable license fee of $ 33 under the amended License Agreement. F- 16 The Company is required to pay certain milestone payments upon the achievement of specified clinical and commercial milestones. Milestone payments are reduced by a certain percentage for the second product that achieves a milestone, by an additional percentage for the third product that achieves a milestone, and so on, for each subsequent product that achieves a milestone. In the event that the Company is able to successfully develop and launch multiple products under the License Agreement, total milestone payments could be approximately $ 21,000 . Penn is also eligible to receive tiered royalties at percentage rates in the low single-digits, subject to an annual minimum royalty, on annual worldwide net sales of any products that are commercialized by the Company or its sublicensees that contain or incorporate, or are covered by, the intellectual property licensed by the Company. To the extent the Company sublicenses its license rights under the License Agreement, Penn would be eligible to receive tiered sublicense income at percentage rates in the mid-single to low double-digits. There were no amounts due under the License Agreement as of December 31, 2025. Master Translational Research Services Agreements In October 2018 and February 2023, the Company entered into services agreements (the CAART and CARTA Services Agreements) with Penn for research, development and manufacturing services from various laboratories within Penn. The activities are detailed in separately executed Penn organization-specific addenda. In May 2020, the Company amended its Addendum with the Center for Advanced Retinal and Ocular Therapeutics (CAROT) to expand access to vector manufacturing. Research and development expense recognized under executed addenda to the master translational research services agreements with Penn was $ 5,062 and $ 3,250 for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025 , the Company had no remaining commitments under the CARTA Services Agreement. Exclusive License Agreement with IASO Biotherapeutics On October 7, 2022, the Company entered into an Exclusive License Agreement (the IASO Agreement) with Nanjing IASO Biotherapeutics Co., Ltd. (IASO). Pursuant to the IASO Agreement, the Company received an exclusive, worldwide license under certain IASO intellectual property to use a novel clinical-stage anti-CD19 binder to develop, manufacture, commercialize and otherwise exploit T cell products directed to CD19 for the purpose of diagnosis, prevention or treatment of any autoimmune or alloimmune indications in humans. As partial consideration for the exclusive license, IASO received an upfront payment of $ 2,500 . IASO is also eligible to receive up to mid double digit millions in milestone payments based upon the achievement of specified pre-clinical, development and regulatory milestones, and up to an additional low triple digit millions in milestone payments based upon achievement of specified sales milestones, for a total consideration, inclusive of the upfront payment, of up to $ 162,000 , along with tiered mid-single digit royalties on future net sales for licensed products that may result from the IASO Agreement. Upon the U.S. Food and Drug Association’s clearance of the rese-cel Investigational New Drug application for the treatment of systemic lupus erythematosus in March 2023, a milestone payment of $ 1,000 was recognized in the accompanying statements of operations. A milestone payment of $ 1,500 was paid to IASO in the first quarter of 2024 after the first patient in a rese-cel trial was dosed. IASO has the right of first negotiation if the Company desires to grant a third party an exclusive license to develop, manufacture, commercialize or otherwise exploit the licensed products in the Greater China region. Pursuant to the IASO Agreement, each of IASO and the Company have agreed, subject to certain exceptions, to refrain from engaging in certain competitive activities with respect to certain programs. The Company also may sublicense through multiple tiers the rights granted to it by IASO under the IASO Agreement at any time, however, it must pay IASO a low double-digit percentage of any revenue obtained from sublicenses or options to third parties, subject to certain customary exclusions. The IASO Agreement will continue on a country-by-country, licensed product-by-licensed product basis until the expiration of the royalty term as identified in the IASO Agreement, unless earlier terminated. Each of the Company and IASO may terminate the Agreement for a material, uncured breach or insolvency of the other party. The Company may also terminate the Agreement at will upon advance written notice and in the event IASO rejects the Agreement due to bankruptcy-related matters. IASO may also terminate the Agreement if the Company fails to achieve certain specified diligence milestones in a timely manner and/or if the Company commences any patent challenges with respect to the patents and patent applications relating to the licensed sequence, in each case upon advance written notice. Licence and Supply Agreement with Oxford Biomedica F- 17 In December 2021, the Company entered into a Licence and Supply agreement (LSA) with Oxford Biomedica (UK) Limited (Oxford), wherein the LSA grants the Company a non-exclusive license to Oxford’s LentiVector® platform for its application in the Company’s DSG3-CAART program and put in place a multi-year vector supply agreement. Oxford is eligible to receive regulatory and sales milestones in the low tens of millions and royalties in the low single digits on net sales of products that incorporate the Oxford technology. In May 2023, the Company amended the LSA with Oxford to expand the license to include the Company's rese-cel program for an upfront fee of $ 500 . In August 2023, the Company and Oxford entered into a vector supply agreement for rese-cel, and a related second amendment to the LSA, with a total cost under the vector supply agreement of up to approximately $ 5,000 , which has been fully expensed as of December 31, 2024. In February 2024, the Company and Oxford entered into a third amendment to the LSA to update the patent schedule. In June 2024, the Company and Oxford entered into a fourth amendment to the LSA eliminating royalties on net sales of products that incorporate the Oxford technology if Oxford manufactures the vector. Starting in December 2024, the Company and Oxford entered into work orders with a cost of approximately $ 23,000 for certain process characterization and process performance qualification activities as part of commercial readiness activities. As of December 31, 2025 , the Company has recognized project to date expense of $ 8,673 related to these activities. The Company can terminate the LSA or any work order under the LSA at will upon advance written notice and subject to certain cancellation fees. Option and License Agreement with Autolus In January 2023, the Company entered into an Option and License Agreement (Autolus Agreement) with Autolus Holdings (UK) Limited (Autolus), wherein the Autolus Agreement granted the Company a non-exclusive license to access Autolus' RQR8 technology in its CD19-CAR T cell therapy program, and subject to additional nominal option exercise fees, up to four additional t argets. In January 2025, the Company and Autolus agreed to novate the Autolus Agreement with both Autolus and Autolus Limited jointly assuming the rights, obligations and liabilities of Autolus, under the Autolus Agreement. Under the terms of the Autolus Agreement, the Company was required to pay Autolus an upfront license fee of $ 1,200 that was recognized as expense in the first quarter of 2023 in the accompanying statements of operations, of which $ 1,100 was paid in 2023 and $ 100 was paid in January 2024. Autolus is also eligible to receive regulatory milestones of up to $ 12,000 for each licensed target, sales milestones of up to a total of $ 15,000 and royalties in the low single digits on net sales of all products that incorporate the RQR8 technology. The Autolus Agreement will continue on a country-by-country, licensed product-by-licensed product basis until the expiration of the royalty term as identified in the Autolus Agreement, unless earlier terminated. The Company can terminate the Autolus Agreement at will upon advance written notice. Each of the Company and Autolus may terminate the Agreement for a material, uncured breach or insolvency of the other party. 7. Commitments and Contingencies Manufacturing Agreements In January 2021, the Company entered into a Development and Manufacturing Services Agreement (Minaris Agreement) with Minaris Advanced Therapies, LLC, or Minaris (f/k/a WuXi Advanced Therapies, Inc.) to serve as an additional cell processing manufacturing partner for the MuSK-CAART Phase 1 clinical trial, or MusCAARTes TM trial. The Minaris Agreement is scheduled to expire upon completion of Minaris' services related to MuSK-CAART and rese-cel. In August 2023, and as extended in August 2024, the Company entered into an agreement with Minaris to serve as one of the Company's manufacturing partners for the global clinical development of rese-cel in multiple indications, including potential late-stage clinical trials and commercial readiness activities for rese-cel. Under the August 2023 work orders, Minaris converted the Company’s non-dedicated suite to a dedicated suite for GMP manufacturing for the Company’s rese-cel and MuSK-CAART programs, or the Dedicated Suite, for an initial term of 18 months with two 18-month extensions at the Company’s sole option on six months' notice prior to the end of the term. In August 2024, the Company sent a notice to Minaris to extend the initial term of the Minaris Agreement by 18 months through August 2026. In addition, the Company agreed to certain monthly minimum runs. In August 2024, the 2023 work order related to GMP manufacturing was amended to reduce the minimum monthly runs through the end of 2024. In lieu of the original $ 1,500 termination fee under the terms of the Minaris Agreement, the Company would incur up to a $ 1,080 termination fee if it terminates both the rese-cel and MuSK-CAART work orders for any reason. The Company may terminate for convenience the Minaris Agreement or any work order with six months' prior written notice. However, the Company may not terminate the Dedicated Suite without terminating F- 18 both the MuSK-CAART and rese-cel GMP run work orders. Minaris may terminate for convenience the Minaris Agreement or any work order on 18 months' prior written notice, but such notice may not be effective prior to February 202 8. In February 2026, the Company notified Minaris that it intended to permit the term to expire in August 2026. In December 2024, the Company entered into a Development and Manufacturing Services Agreement (the Lonza Agreement) with Lonza Houston Inc. (Lonza) to serve as one of the Company's manufacturing partners for the global clinical development of rese-cel in multiple indications, including potential late-stage clinical trials and preparations for commercial readiness. The Lonza Agreement has a term of five years and can be extended for an additional three year term upon notice to Lonza at least 18 months prior to the expiration of the Lonza Agreement. The Company can terminate the Lonza Agreement at will upon nine months advance written notice to Lonza subject to the terms of the Lonza Agreement. Lonza can terminate the Lonza Agreement at will upon 24 months advance written notice to Cabaletta subject to the terms of the Lonza Agreement. Under the initial work order, Lonza will perform cell therapy manufacturing activities for Cabaletta’s CAR-T cell therapy product, rese-cel, for an initial term of 12 months with the ability to extend the manufacturing period on a rolling basis subject to the terms of the Lonza Agreement. Other Purchase Commitments In the normal course of business, the Company enters into various purchase commitments with third-party contract manufacturers for the manufacture and processing of its product candidates and related raw materials, contracts with contract research organizations for clinical trials and agreements with vendors for other services and products for operating purposes. These agreements generally provide for termination or cancellation, other than for costs already incurred. Indemnification The Company enters into certain types of contracts that contingently require the Company to indemnify various parties against claims from third parties. These contracts primarily relate to (i) the Company’s Amended and Restated Bylaws, as amended, (bylaws) under which the Company must indemnify directors and executive officers, and may indemnify other officers and employees, for liabilities arising out of their relationship, (ii) contracts under which the Company must indemnify directors and certain officers and consultants for liabilities arising out of their relationship, (iii) contracts under which the Company may be required to indemnify partners against certain claims, including claims from third parties asserting, among other things, infringement of their intellectual property rights, and (iv) procurement, consulting, or license agreements under which the Company may be required to indemnify vendors, consultants or licensors for certain claims, including claims that may be brought against them arising from the Company’s acts or omissions with respect to the supplied products, technology or services. From time to time, the Company may receive indemnification claims under these contracts in the normal course of business. In addition, under these contracts, the Company may have to modify the accused infringing intellectual property and/or refund amounts received. In the event that one or more of these matters were to result in a claim against the Company, an adverse outcome, including a judgment or settlement, may have a material adverse effect on the Company’s future business, operating results or financial condition. It is not possible to determine the maximum potential amount under these contracts due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. Litigation From time to time, the Company may become involved in litigation or legal proceedings. While the outcome of any such proceedings cannot be predicted with certainty, as of December 31, 2025, the Company is not involved in any material litigation or legal proceedings that it would expect to have a material adverse impact on its financial position, results of operations, or cash flows. F- 19 8. Segment Information Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the CODM in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s CODM is the CEO. The Company has determined it operates in a single operating segment and has one reportable segment. The segment consists of the development of clinical and preclinical product candidates for the discovery and development of innovative engineered T cell therapies and related administrative activities. The CODM assesses performance and allocates resources based on the Company’s consolidated statement of operations, which is reported on the income statement as consolidated net loss and considers forecast-to-actuals variances on a quarterly basis for expenses that are deemed significant. Further, the CODM reviews the segment’s assets based on the consolidated balance sheet to assess liquidity and funding capacity. The majority of the Company's assets are located in the United States. The Company’s CODM views specific categories within expenses as significant given the direct correlation between cash burn and profitability as a pre-revenue company. Significant segment expenses, as provided to the CODM, are presented below. For additional information on the year over year change of segment expenses refer to Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. Year Ended December 31, 2025 2024 (in thousands) Research and development expenses: Personnel $ 46,934 $ 39,239 Clinical trials 39,581 22,286 Manufacturing of preclinical and clinical supplies 38,240 15,523 Development services 15,350 16,417 License of intellectual property — 1,523 Other research and development costs (1) 2,569 2,215 General and administration expenses 29,567 27,938 Interest income ( 6,031 ) ( 10,025 ) Interest expense 2,004 748 Other income, net ( 358 ) — Net loss $ 167,856 $ 115,864 (1) Other research and development costs includes costs associated with information technology, travel, medical and scientific symposiums and conferences. 9. Leases The Company leases office and laboratory space and has two manufacturing agreements that have been determined to include embedded leases. Operating lease commitments The Company leases office and laboratory space which include rent escalations and are subject to additional variable charges, including common area maintenance, property taxes and property insurance. Given the variable nature of such costs, they are recognized as expense as incurred. Additionally, some of the Company’s leases are subject to certain fixed fees which the Company has determined to be non-lease components. The Company has elected the practical expedient to account for lease and non-lease components as a single-lease component and has included fixed payments related to non-lease components in calculating the operating lease liability. The lease term F- 20 for our laboratory space was extended in October 2025 through November 2026 resulting in an increase of the right-of-use asset and lease liability of $ 787 . Finance lease commitments - Embedded leases As described further in Note 7, in August 2023, the Company entered into new work orders under the Minaris Agreement for Minaris to serve as one of the Company’s cell processing manufacturing partners for the global clinical development of rese-cel. Minaris converted the Company’s non-dedicated suite to a Dedicated Suite for GMP manufacturing for the Company’s rese-cel and MuSK-CAART programs, for an initial term of 18 months. The terms of the August 2023 work orders included both fixed costs and contingent variable costs. The lease commenced October 1, 2023. In 2024, the Company remeasured the lease following the resolution of the contingency related to variable costs and an amendment to the 2023 work order, which extended the term of the agreement by an additional 18 months through August 2026. The Company may terminate the Dedicated Suite lease for convenience with six months’ prior written notice and up to a $ 1,080 termination fee if both the rese-cel and MuSK-CAART work orders are terminated . In February 2026, the Company notified Minaris that it intended to permit the term to expire in August 2026. As described further in Note 7, in December 2024, the Company entered into the Lonza Agreement with Lonza to serve as one of the Company's cell processing manufacturing partners. Under the initial work order, Lonza will perform cell therapy manufacturing activities for the CAR-T cell therapy product rese-cel for a term of 12 months with the ability to extend the manufacturing period subject to the terms of the Lonza Agreement. The Lonza Agreement was evaluated under ASC 842 and determined to contain an embedded finance lease commencing in March 2025, resulting in the recognition of a right-of-use asset and lease liability of $ 14,934 . As of December 31, 2025, the Company extended the lease term in accordance with the Lonza Agreement resulting in an increase of the right-of-use asset and lease liability of $ 6,137 . Summary of leases under ASC 842 The following table contains information pertaining to the Company’s operating and finance leases for the years ended December 31, 2025 and 2024. Year Ended December 31, 2025 2024 Finance leases Interest expense $ 2,004 $ 748 Amortization expense 12,391 3,102 Total fixed finance lease cost $ 14,395 $ 3,850 Variable lease cost 5,508 930 Total finance lease cost $ 19,903 $ 4,780 Operating leases Fixed lease cost $ 4,211 $ 3,247 Total fixed operating lease cost $ 4,211 $ 3,247 Variable lease cost 171 296 Short-term lease cost 34 750 Total operating lease cost $ 4,416 $ 4,293 Cash paid in the measurement of lease liabilities Operating cash flows used for operating leases $ 4,227 $ 3,291 Operating cash flows used for finance leases 1,713 748 Financing cash flows for finance leases 6,261 897 Other information Weighted average remaining lease term - finance leases (in years) 1.1 1.7 Weighted average discount rate - finance leases 10.7 % 11.5 % Weighted average remaining lease term - operating leases (in years) 0.9 1.7 Weighted average discount rate - operating leases 10.3 % 11.0 % F- 21 For finance leases embedded in CDMO arrangements, interest expense is recognized using the effective interest method, applying the Company's incremental borrowing rate as required by ASC 842, and amortization expense is recognized on a straight-line basis over the shorter of the life of the asset or the term of the lease. Future lease payments under the non-cancelable leases as of December 31, 2025 are as follows : Finance Leases Operating Leases 2026 $ 21,914 $ 3,633 2027 3,280 — Total undiscounted lease payments 25,194 3,633 Less imputed interest ( 1,557 ) ( 172 ) Total lease liability $ 23,637 $ 3,461 10. Common Stock Common Stock Pursuant to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, the Company is authorized to issue 293,590,481 shares of voting common stock and 6,409,519 shares of non-voting common stock. In May 2024, the remaining 1,444,295 shares of non-voting common stock were converted to voting common stock and no shares of non-voting common stock are outstanding as of December 31, 2025. June 2025 Financing In June 2025, the Company issued (i) 39,200,000 shares of its common stock and accompanying warrants to purchase an aggregate of 39,200,000 shares of common stock (or pre-funded warrants in lieu thereof) and (ii) in lieu of common stock, to certain investors, pre-funded warrants to purchase an aggregate of up to 10,800,000 shares of its common stock and accompanying warrants to purchase an aggregate of 10,800,000 shares of common stock (or pre-funded warrants in lieu thereof), at an exercise price of $ 0.00001 per pre-funded warrant. An additional 3,090,190 common stock warrants were issued in the financing for shares purchased by the underwriters in the market to cover overallotment demand. The combined offering price of each share of common stock and accompanying common stock warrant was $ 2.00 . The combined offering price of each pre-funded warrant and accompanying common stock warrant was $ 1.99999 . The pre-funded warrants are exercisable immediately. The common stock and pre-funded warrants were sold in combination with an accompanying common stock warrant to purchase one share of common stock (or a pre-funded warrant in lieu thereof) for each share of common stock or pre-funded warrant sold. Each common stock warrant has an exercise price per share of $ 2.50 . The common stock warrants are immediately exercisable from the date of issuance and will expire on September 12, 2026, fifteen months from the date of issuance. Aggregate net proceeds were $ 93,558 after deducting underwriting discounts and commissions and offering expenses. As of December 31, 2025 , 4,800,000 pre-funded warrants had been exercised and 6,000,000 remain outstanding. As of December 31, 2025 , no common stock warrants had been exercised and 53,090,190 remain outstanding. Subsequent to December 31, 2025 , 2,775,100 common stock warrants were exercised for proceeds of $ 6,938 . The pre-funded warrants and common stock warrants were classified as a component of permanent stockholders’ equity within additional paid-in capital and were recorded at the issuance date using a relative fair value allocation method. The pre-funded warrants and common stock warrants are equity classified because they (i) are freestanding financial instruments that are legally detachable and separately exercisable from the equity instruments, (ii) are immediately exercisable, (iii) do not embody an obligation for the Company to repurchase its shares, (iv) permit the holders to receive a fixed number of shares of common stock upon exercise, (v) are indexed to the Company’s common stock and (vi) meet the equity classification criteria. In addition, such pre-funded warrants and common stock warrants do not provide any guarantee of value or return. At-the-Market Offering F- 22 On March 31, 2025, the Company converted the Form S-3ASR to a Form S-3 (File No. 333-278126) by post-effective amendments. This Form S-3 was declared effective on March 31, 2025. The Company had a Sales Agreement with TD Securities (USA) LLC (as successor to Cowen and Company, LLC) (TD Cowen) to provide for the offering, issuance and sale of up to an aggregate amount of $ 200.0 million of common stock from time to time in “at-the-market” offerings (2024 ATM Program) pursuant to its S-3, and subject to the limitations thereof. On June 11, 2025, the 2024 ATM Program with TD Cowen was terminated. Prior to termination, the Company sold an aggregate of 2,609,865 shares pursuant to the 2024 ATM Program for total net proceeds of $ 7,724 , consisting of $ 5,129 in 202 4 and $ 2,595 in 2025. On August 7, 2025, the Company filed a Registration Statement (File No. 333-289339) with the Securities and Exchange Commission (SEC), which was declared effective on August 15, 2025 (2025 Shelf Registration Statement), in relation to the registration of common stock, preferred stock, debt securities, warrants and/or units of any combination thereof for the purposes of selling, from time to time, the Company’s common stock, debt securities or other equity securities in one or more offerings. The Company also simultaneously entered into a Sales Agreement with TD Cowen to provide for the offering, issuance and sale of up to an aggregate amount of $ 150.0 million of the Company's common stock from time to time in “at-the-market” offerings (the 2025 ATM Program) under the 2025 Shelf Registration Statement and subject to the limitations thereof (the 2025 Sales Agreement). During the year ended December 31, 2025 , the Company sold 4,160,176 shares pursuant to the 2025 ATM Program for net proceeds of $ 10,151 . Subsequent to December 31, 2025 , the Company sold 8,055,260 additional shares, for net proceeds of $ 22,568 . 2018 Stock Option and Grant Plan In September 2018, the Company adopted the 2018 Stock Option and Grant Plan (the 2018 Plan), which provided for the Company to sell or issue common stock, or other stock-based awards, to employees, members of the board of directors and consultants of the Company. The Company generally granted stock-based awards with service conditions only (service-based awards), although there was one grant with performance conditions. As of December 31, 2020, there were no unvested options with performance conditions. Stock options granted under the 2018 Plan generally vest over three to four years . A total of 1,959,411 options were granted under the 2018 Plan prior to the Company’s IPO in October 2019. No further grants may be made under the 2018 Plan subsequent to the IPO. 2019 Stock Option and Incentive Plan The 2019 Stock Option and Incentive Plan (2019 Plan) was approved by the Company’s board of directors on October 14, 2019, and became effective on October 23, 2019. The 2019 Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock units, restricted stock awards, unrestricted stock awards, cash-based awards and dividend equivalent rights to the Company’s officers, employees, directors and consultants. The number of shares initially reserved for issuance under the 2019 Plan was 2,342,288 , which will be increased each January 1 thereafter by 4 % of the number of shares of the Company’s common stock outstanding on the immediately preceding December 31 or such lesser number of shares determined by the Company’s board of directors or compensation committee of the board of directors. On June 1, 2023, at the 2023 Annual Meeting of Stockholders of the Company, the stockholders of the Company approved Amendment No. 1 to the 2019 Plan, increasing the number of shares of common stock reserved for issuance under the 2019 Plan by 3,000,000 shares. On January 1, 2026, the total number of shares under the 2019 Plan was increased by 4,019,172 shares pursuant to the 2019 Plan Evergreen Provision. As of December 31, 2025 , there were 1,066,471 shares remaining available for issuance under the 2019 Plan. 2025 Inducement Plan In October 2025, the Company adopted the 2025 Inducement Plan (Inducement Plan). The Inducement Plan was adopted by the Compensation Committee of the Company’s board of directors without stockholder approval pursuant to Nasdaq Listing Rule 5635(c)(4). In accordance with Rule 5635(c)(4), awards made under the Inducement Plan, including stock options and restricted stock units, may only be granted to newly hired employees as a material inducement to accept employment with the Company. Stock options granted under the Inducement Plan expire no F- 23 later than ten years from the date of grant. The number of shares reserved for issuance under the Inducement Plan was 275,000 shares. As of December 31, 2025, there were no shares available for issuance under the Inducement Plan. Stock Option Repricing On May 19, 2025, the Company’s Board of Directors approved the repricing of certain outstanding vested and unvested stock options. Pursuant to the repricing, all options granted under the 2018 Plan and 2019 Plan held by current employees, non-employee directors and certain consultants were repriced to $ 1.92 , the closing price of the Company’s common stock on May 19, 2025, to the extent such options had an exercise price in excess of 1.5x the $ 1.92 closing price per share. To exercise the repriced options at the reduced exercise price, eligible participants must remain employed with the Company through a retention period of 12 months that begins on May 19, 2025. As a result of the repricing, 9,900,096 vested and unvested stock options outstanding as of May 19, 2025, with original exercise prices ranging from $ 2.88 to $ 23.97 , were repriced. The repricing resulted in incremental stock-based compensation expense of $ 3,021 , of which $ 1,813 related to vested stock option awards and is being amortized over the retention period, and $ 1,208 related to unvested stock option awards and is being amortized on a straight-line basis over the remaining vesting period of those awards. Stock Option Activity A summary of stock option activity is presented below: Number of Shares Weighted Average Exercise Price (1) Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (1) Outstanding as of January 1, 2025 11,231,148 $ 10.63 7.4 $ 989 Granted 3,469,050 1.78 Exercised ( 13,334 ) 1.01 9 Forfeited/Cancelled ( 851,492 ) 8.29 Outstanding as of December 31, 2025 13,835,372 $ 8.57 7.1 $ 2,371 Options Exercisable at December 31, 2025 7,860,610 $ 9.45 5.8 $ 899 (1) The weighted average exercise prices and aggregate intrinsic values in this table will not reflect the impact of the May 2025 repricing until the retention period is complete in May 2026. The aggregate intrinsic value of options is calculated as the difference between the exercise price of the options and the fair value of the Company’s common stock. The weighted average grant-date fair value of stock options granted during the years ended December 31, 2025 and 2024 was $ 1.52 and $ 13.44 , respectively. The fair value of each award is estimated using Black-Scholes based on the following assumptions: Year Ended December 31, 2025 2024 Risk-free interest rate 3.72 %— 4.46 % 3.43 %— 4.60 % Expected term 5.5 years— 6.1 years 5.5 years— 6.2 years Expected volatility 112 %— 118 % 106 %— 111 % Expected dividend yield 0 % 0 % Black-Scholes requires the use of subjective assumptions which determine the fair value of stock-based awards. These assumptions include: Expected term —The expected term represents the period that stock-based awards are expected to be outstanding. The expected term for option grants is determined using the simplified method, which is the midpoint between the vesting period and the contractual term of the option. F- 24 Expected volatility —Expected volatility is estimated using the Company's stock price since its IPO in October 2019. Risk-free interest rate —The risk-free interest rate is based on the U.S. Treasury zero coupon issues in effect at the time of grant for periods corresponding with the expected term of a stock-based award. Expected dividend —The Company has never paid dividends on its common stock and has no plans to pay dividends on its common stock. Therefore, the Company used an expected dividend yield of zero. Stock-based Compensation The Company has recorded stock-based compensation in the accompanying statements of operations as follows: Year Ended December 31, 2025 2024 Research and development $ 11,470 $ 10,163 General and administrative 9,469 9,302 Total $ 20,939 $ 19,465 As of December 31, 2025 , there was $ 35,159 of unrecognized compensation cost related to unvested option awards and vested option awards subject to the twelve month retention period, which is expected to be recognized over a weighted-average period of 2.1 years. 2019 Employee Stock Purchase Plan The 2019 Employee Stock Purchase Plan (2019 ESPP) was approved by the Company’s board of directors on October 14, 2019, and became effective on October 23, 2019. A total of 234,229 shares of common stock were initially reserved for issuance under the 2019 ESPP, and such number of shares will be increased each January 1 thereafter through January 1, 2029 by the least of (i) 234,229 shares of common stock, (ii) 1 % of the number of shares of the Company’s common stock outstanding on the immediately preceding December 31 or (iii) such lesser number of shares determined by the 2019 ESPP’s administrator. On January 1, 2026, the total number of shares available under the 2019 ESPP was increased by 234,229 shares pursuant to the 2019 Plan Evergreen Provision. As of December 31, 2025 , there were 136,383 shares remaining available for issuance under the 2019 ESPP. Employee contributions are made through payroll deductions of up to 15 % of eligible compensation over the offering period. A participant may not accrue rights to purchase more than $ 25 worth of the Company’s common stock for each calendar year in which such right is outstanding. At the end of each offering period, shares of the Company’s common stock may be purchased at 85 % of the lesser of the Company’s common stock on (i) the first trading day of the relevant offering period and (ii) the last trading day of the relevant offering period. Each offering period will be six months in duration and will commence on each December 1 and June 1. F- 25 11. Income Taxes The reconciliation of federal statutory income tax rate to the Company’s effective income tax rate is as follows : Year Ended December 31, 2025 2024 U.S. Statutory Tax Rate $ ( 35,304 ) 21.0 % $ ( 24,331 ) 21.0 % State and Local Income Taxes, Net of Federal Income Tax Effect (1) — 0.0 % — 0.0 % Foreign Tax Effects 24 0.0 % ( 4 ) 0.0 % Effect of Cross-Border Tax Laws 94 - 0.1 % 6 0.0 % Tax Credits ( 9,489 ) 5.6 % ( 5,769 ) 5.0 % Change in Valuation Allowances (Domestic) 43,489 - 25.9 % 29,176 - 25.2 % Nontaxable or Nondeductible Items 983 - 0.6 % 951 - 0.8 % Other Adjustments 203 0.0 % ( 29 ) 0.0 % Actual income tax benefit effective tax rate $ — 0.0 % $ — 0.0 % (1) Within the State Income Tax category, Pennsylvania and Philadelphia accounted for the majority, representing over 50% of the total reconciling impact. Consistent with the Company’s cumulative loss position and absence of taxable income in federal, state, and local jurisdictions, the Company made no income tax payments and received no income tax refunds in the current fiscal year. Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The principal components of the Company’s deferred tax assets and liabilities consisted of the following: Year Ended December 31, 2025 2024 Deferred tax assets: Federal, state and local net operating loss carryforwards $ 83,014 $ 44,369 Capitalized research and development costs 31,333 36,646 Research and development tax credits 25,050 16,296 Stock-based compensation deductions 13,299 9,919 License fee deductions 186 221 Operating lease liabilities 7,357 4,607 Accrued expenses 2,805 2,603 Gross deferred tax assets 163,044 114,661 Less: valuation allowance ( 157,850 ) ( 110,723 ) Total deferred tax assets 5,194 3,938 Deferred tax liabilities: Operating lease right-of-use assets ( 5,194 ) ( 3,938 ) Net deferred tax assets $ — $ — The Company increased its valuation allowance by $ 47,127 for the year ended December 31, 2025 in order to maintain a full valuation allowance against its deferred tax assets. Based on the Company’s history of losses, the Company recorded a full valuation allowance against its deferred tax assets as of December 31, 2025. The Company intends to maintain a valuation allowance until sufficient positive evidence exists to support a reversal of the allowance. As of December 31, 2025 , the Company had federal, state and local net operating loss carryforwards of $ 319,886 , $ 255,101 and $ 257,607 , respectively; $ 319,636 of the federal net operating losses do not expire, and the remaining $ 250 expire in 2037 . The state net operating losses begin to expire in 2037 . The local net operating losses begin to expire in 2042 . As of December 31, 2025 , the Company had federal and state research and development tax credit carryforwards of $ 25,044 and $ 6 , respectively. The research and development credits begin to expire in 2038 . The Company’s federal F- 26 research credits consist of approximately $ 13,821 of Research and Development credits and $ 11,223 of Orphan Drug credits. Under the provisions of Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, or the Code, these net operating losses, credit carryforwards and other tax attributes may be subject to limitation based on previous significant changes in ownership and upon future significant changes in ownership of the Company, as defined by the Code. The Company files income tax returns in the U.S. federal jurisdiction and in multiple state and local jurisdictions; however, Pennsylvania and Philadelphia constitute the Company’s most significant tax jurisdictions due to the concentration of its operational footprint and the resulting apportionment profile. The tax years 2024, 2023 and 2022 remain open to examination by the jurisdictions where the Company is subject to tax. The Company evaluates tax positions for recognition using a more-likely-than-not recognition threshold, and those tax positions eligible for recognition are measured as the largest amount of tax benefit that is greater than 50 % likely of being realized upon the effective settlement with a taxing authority that has full knowledge of all relevant information. As of December 31, 2025 , the Company had no unrecognized income tax benefits that would affect the Company’s effective tax rate if recognized. F- 27 12. Net Loss Per Share T he Company calculates basic and diluted net loss per share in conformity with the two-class method required for participating securities. In May 2024, the remaining 1,444,295 shares of non-voting common stock were converted to voting common stock and no shares of non-voting common stock remain outstanding. Since the rights of the voting and non-voting common stock are identical, except with respect to voting, the undistributed losses of the Company have been allocated on a proportionate basis to the two classes. Basic net loss per share of common stock is computed by dividing the net loss per share of common stock by the weighted average number of shares of common stock outstanding for the period. The weighted-average shares of common stock outstanding as of December 31, 2025 included outstanding pre-funded warrants to purchase up to an aggregate of 6,000,000 shares of common stock. No pre-funded warrants were outstanding as of December 31, 2024. Diluted net loss per share is calculated using the if-converted method as of December 31, 2024, which assumes conversion of all non-voting common stock to voting common stock. Year ended December 31, 2025 Voting common stock Basic and diluted net loss per share: Net loss $ ( 167,856 ) Weighted average number of shares outstanding 79,903,224 Net loss per share, basic and diluted $ ( 2.10 ) F- 28 Year ended December 31, 2024 Voting common stock Non-voting common stock Basic net loss per share: Numerator Allocation of undistributed losses $ ( 114,728 ) $ ( 1,136 ) Denominator Weighted average number of shares used in basic per share computation 49,038,726 485,378 Net loss per share, basic $ ( 2.34 ) $ ( 2.34 ) Diluted net loss per share: Numerator Allocation of undistributed losses for basic computation $ ( 114,728 ) $ ( 1,136 ) Reallocation of undistributed losses as a result of conversion of non-voting to voting common shares ( 1,136 ) — Allocation of undistributed losses $ ( 115,864 ) $ ( 1,136 ) Denominator Weighted average number of shares used in basic per share computation 49,038,726 485,378 Add: conversion of non-voting to voting common shares outstanding 485,378 — Weighted average number of shares used in diluted per share computation 49,524,104 485,378 Net loss per share, diluted $ ( 2.34 ) $ ( 2.34 ) The following outstanding potentially dilutive shares have been excluded from the calculation of diluted net loss per share, as their effect is anti-dilutive: Year Ended December 31, 2025 2024 Stock options to purchase common stock 13,835,372 11,231,148 Warrants to purchase common stock 53,090,190 — Total 66,925,562 11,231,148 F- 29 13. 401(k) Savings Plan The Company maintains a defined-contribution savings plan under Section 401(k) of the IRC, or the 401(k) Plan. The 401(k) Plan covers all employees who meet defined minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pretax basis. Effective January 1, 2020, the Plan provided for matching contributions on a portion of participant contributions pursuant to the 401(k) Savings Plan’s matching formula, up to 4 % of eligible compensation. All matching contributions and participant contributions vest immediately. Contributions totaled $ 1,063 and $ 894 for the years ended December 31, 2025 and 2024 , respectively, and have been recorded in the statements of operations. F- 30 EXHIBIT INDEX Exhibit Number Description 3.1 Third 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. 001-39103) filed on October 30, 2019) 3.2 Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s current report on Form 8-K (File No. 001-39103) filed with the SEC on June 10, 2025) 3.3 Amended and Restated Bylaws 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. 001-39103) filed on October 30, 2019) 3.4 Amendment No. 1 to the Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.3 to the Registrant's Quarterly Report on Form 10-Q (File No. 001-39103) filed with the SEC on May 12, 2022) 4.1 Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 of the Registrant’s Registration Statement on Form S-1 (File No. 333-234017) filed on October 16, 2019 ) 4.2* Description of Securities 4.3 Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 of the Registrant's Current Report on Form 8-K (File No. 001-39103) filed with the SEC on December 12, 2022 4.4 Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 to the Registrant’s current report on Form 8-K (File No. 001-39103) filed with the SEC on June 12, 2025) 4.5 Form of Common Stock Warrant (incorporated by reference to Exhibit 4.2 to the Registrant’s current report on Form 8-K (File No. 001-39103) filed with the SEC on June 12, 2025) 10.1# 2018 Stock Option and Grant Plan, as amended, and form of award agreements thereunder (incorporated by reference to Exhibit 10.1 of the Registrant’s Registration Statement on Form S-1 (File No. 333-234017) filed on September 30, 2019) 10.2# 2019 Stock Option and Incentive Plan, and form of award agreements thereunder. (incorporated by reference to Exhibit 10.2 of the Registrant’s Registration Statement on Form S-1/A (File No. 333-234017) filed on October 16, 2019) 10.3# Amendment No. 1 to the Cabaletta Bio, Inc. 2019 Stock Option and Incentive Plan (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on June 1, 2023) 10.4# 2019 Employee Stock Purchase Plan. (incorporated by reference to Exhibit 10.3 of the Registrant’s Registration Statement on Form S-1/A (File No. 333-234017) filed on October 16, 2019) 10.5# Senior Executive Cash Incentive Bonus Plan (incorporated by reference to Exhibit 10.4 of the Registrant’s Quarterly Report on Form 10-Q filed on December 5, 2019) 10.6# Form of Indemnification Agreement between the Registrant and each of its directors (incorporated by reference to Exhibit 10.5 of the Registrant’s Registration Statement on Form S-1, filed with the SEC on September 30, 2019) 135 10.7# Form of Indemnification Agreement between the Registrant and each of its executive officers (incorporated by reference to Exhibit 10.4 of the Registrant’s Registration Statement on Form S-1, filed with the SEC on September 30, 2019) 10.8#* Cabaletta Bio, Inc. 2025 Inducement Plan 10.9+ Amended and Restated License Agreement, dated as of July 23, 2019, among the Registrant, the Trustees of the University of Pennsylvania and the Children’s Hospital of Philadelphia (incorporated by reference to Exhibit 10.6 to the Registrant’s Registration Statement on Form S-1, filed with the SEC on September 30, 2019) 10.10+ Master Translational Research Services Agreement, dated as of October 2018, between the Registrant and the Trustees of the University of Pennsylvania (incorporated by reference to Exhibit 10.9 to the Registrant’s Registration Statement on Form S-1, filed with the SEC on September 30, 2019) 10.11+ CVPF Master Services Addendum to Master Translational Research Services Agreement, dated as of October 22, 2018, between the Registrant and the Trustees of the University of Pennsylvania (incorporated by reference to Exhibit 10.11 to the Registrant’s Registration Statement on Form S-1, filed with the SEC on September 30, 2019) 10.12 Lease, dated as of February 11, 2019, between the Registrant and Brandywine Cira, L.P. (incorporated by reference to Exhibit 10.13 to the Registrant’s Registration Statement on Form S-1, filed with the SEC on September 30, 2019) 10.13# Employment Agreement between the Registrant and Steven Nichtberger (incorporated by reference to Exhibit 10.16 to the Registrant’s Registration Statement on Form S-1, filed with the SEC on September 30, 2019) 10.14# Employment Agreement between the Registrant and Anup Marda (incorporated by reference to Exhibit 10.17 to the Registrant’s Registration Statement on Form S-1, filed with the SEC on September 30, 2019) 10.15# Employment Agreement between the Registrant and Gwendolyn Binder (incorporated by reference to Exhibit 10.18 to the Registrant’s Registration Statement on Form S-1, filed with the SEC on September 30, 2019) 10.16# Employment Agreement between the Registrant and David Chang (incorporated by reference to Exhibit 10.19 to the Registrant’s Registration Statement on Form S-1, filed with the SEC on September 30, 2019) 10.17# Fourth Amended and Restated Non-Employee Director Compensation Policy (incorporated by reference to Exhibit 10.17 to the Registrant’s Annual Report on Form 10-K (File No. 001-39103) filed on March 31, 2025) 10.18+ First Amendment, dated May 27, 2020, to the Amended and Restated License Agreement, dated July 23, 2019, among the Registrant, the Trustees of the University of Pennsylvania and the Children’s Hospital of Philadelphia (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K (File No. 001-39103) filed on May 28, 2020) 10.19+ Second Amendment, dated October 19, 2021, to the First Amended and Restated License Agreement, dated May 27, 2020, among the Registrant, the Trustees of the University of Pennsylvania and the Children’s Hospital of Philadelphia (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-39103) filed on November 1, 2021) 10.20 First Amendment, dated February 15, 2022, to the Lease, dated as of February 11, 2019, between the Registrant and Brandywine Cira, L.P. (incorporated by reference to Exhibit 10.26 to the Registrant’s Annual Report on Form 10-K (File No. 001-39103) filed on March 17, 2022) 136 10.21# Form of Employment Agreement (incorporated by reference to Exhibit 10.28 to the Registrant’s Annual Report on Form 10-K (File No. 001-39103) filed on March 17, 2022) 10.22+ Option Agreement, dated December 23, 2021, by and between the Registrant and the Trustees of the University of Pennsylvania (incorporated by reference to Exhibit 10.30 to the Registrant’s Annual Report on Form 10-K (File No. 001-39103) filed on March 17, 2022) 10.23+ Licence and Supply Agreement, dated December 30, 2021, by and between the Registrant and Oxford Biomedica (UK) Limited (incorporated by reference to Exhibit 10.31 to the Registrant’s Annual Report on Form 10-K (File No. 001-39103) filed on March 17, 2022) 10.24+ First Amendment to the Licence and Supply Agreement, dated as of May 2, 2023, between the Registrant and Oxford Biomedica (UK) Limited (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-39103) filed on August 10, 2023) 10.25+ Second Amendment to the Licence and Supply Agreement, dated as of August 18, 2023, between the Registrant and Oxford Biomedica (UK) Limited (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-39103) filed on November 9, 2023) 10.26+ Exclusive License Agreement, dated October 7, 2022, by and between the Registrant and Nanjing IASO Biotherapeutics Co., LTD.(incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-39103) filed on November 10, 2022 ) 10.27+ Development, Manufacturing, and Testing Services Agreement, dated January 11, 2021, between the Registrant and WuXi Advanced Therapies Inc. (incorporated by reference to Exhibit 10.34 to the Registrant’s Annual Report on Form 10-K (File No. 001-39103) filed on March 16, 2023) 10.28+ Master Translational Research Services Agreement, dated as of February 9, 2023, between the Registrant and the Trustees of the University of Pennsylvania (incorporated by reference to Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q (File No. 001-39103) filed on May 11, 2023) 10.29+ Third Amendment to the Licence and Supply Agreement, dated as of February 21, 2024, between the Registrant and Oxford Biomedica (UK) Limited (incorporated by reference to Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q (File No. 001-39103) filed on May 15, 2024) 10.30+ Fourth Amendment to the Licence and Supply Agreement, dated as of June 24, 2024, between the Registrant and Oxford Biomedica (UK) Limited (incorporated by reference to Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q (File No. 001-39103) filed on August 8, 2024) 10.31+ Services Agreement, dated as of February 1, 2019, between the Registrant and CIC Innovation Communities, LLC (incorporated by reference to Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q (File No. 001-39103) filed on November 14, 2024) 10.32+ Amendment to the Services Agreement, dated as of December 1, 2021, between the Registrant and CIC Innovation Communities, LLC (incorporated by reference to Exhibit 10.2 to the Registrant's Quarterly Report on Form 10-Q (File No. 001-39103) filed on November 14, 2024) 10.33+ Amendment to the Services Agreement, dated as of September 30, 2024, between the Registrant and CIC Innovation Communities, LLC (incorporated by reference to Exhibit 10.3 to the Registrant's Quarterly Report on Form 10-Q (File No. 001-39103) filed on November 14, 2024) 10.34+ Second Amendment, dated September 24, 2024, to the Lease, dated as of February 11, 2019, between the Registrant and Brandywine Cira, L.P., as amended. (incorporated by reference to Exhibit 10.4 to the Registrant's Quarterly Report on Form 10-Q (File No. 001-39103) filed on November 14, 2024) 137 10.35+ Development and Manufacturing Services Agreement, dated as of December 19, 2024, between the Registrant and Lonza Houston Inc. (incorporated by reference to Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q (File No. 001-39103) filed on August 7, 2025) 10.38+* Development and Manufacturing Services Agreement, dated as of January 11, 2026, between the Registrant and Cellares Corporation 19.1 Insider Trading Policy (incorporated by reference to Exhibit 19.1 to the Registrant’s Annual Report on Form 10-K (File No. 001-39103) filed on March 31, 2025) 21.1* List of Subsidiaries of the Registrant 23.1* Consent of Ernst & Young, independent registered public accounting firm 31.1* Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended 31.2* Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended 32.1** Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 32.2** Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 99.7 Cabaletta Bio, Inc.'s Compensation Recovery Policy (incorporated by reference to Exhibit 99.7 to the Registrant's Annual Report on Form 10-K (File No. 001-39103) filed on March 21, 2024) 101.INS* 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 101.SCH* Inline XBRL Taxonomy Extension Schema Document 101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document 104* Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101*) # Management Contract or compensatory plan or arrangement. + Portions of this exhibit (indicated by asterisks) have been omitted pursuant to Item 601(b)(10) of Regulation S-K. * Filed herewith. ** The certifications furnished in Exhibit 32.1 and 32.2 hereto are deemed to accompany this Annual Report on Form 10-K and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. Such certifications will not be deemed to be incorporated by reference into any filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Registrant specifically incorporates it by reference. 138 SIGNATURES 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 Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized . Cabaletta Bio, Inc. Date: March 23, 2026 By: /s/ Steven Nichtberger Steven Nichtberger, M.D. Chief Executive Officer and President 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 in the capacities and on the dates indicated. Name Title Date /s/ Steven Nichtberger Director, Chief Executive Officer and President March 23, 2026 Steven Nichtberger, M.D. (Principal Executive Officer) /s/ Anup Marda Chief Financial Officer March 23, 2026 Anup Marda (Principal Financial and Accounting Officer) /s/ Catherine Bollard Director March 23, 2026 Catherine Bollard, M.D. /s/ Scott Brun Director March 23, 2026 Scott Brun, M.D. /s/ Richard Henriques Director March 23, 2026 Richard Henriques /s/ Mark Simon Director March 23, 2026 Mark Simon /s/ Shawn Tomasello Director March 23, 2026 Shawn Tomasello 139