4 unchanged sentences
Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities and Exchange Act of 1934, as amended).
−Removed: We maintain “disclosure controls and procedures,”
−Removed: as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act) that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is (1) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and (2) accumulated and communicated to our management, including our principal executive and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
+Added: We maintain “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act) that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is (1) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and (2) accumulated and communicated to our management, including our principal executive and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and our management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
4 unchanged sentences
Our management is responsible for establishing and maintaining adequate internal control over financial reporting.
−Removed: Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, a company’s principal executive officer and principal financial officer, or persons performing similar functions, and effected by a company’s board of directors, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
−Removed: pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of a company’s assets;
−Removed: provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that a company’s receipts and expenditures are being made only in accordance with authorizations of the company’s management and directors;
+Added: Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, a company’s principal executive officer and principal financial officer, or persons performing similar functions, and effected by a company’s board of directors, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
+Added: • pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of a company’s assets;
+Added: • provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that a company’s receipts and expenditures are being made only in accordance with authorizations of the company’s management and directors;
• provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
2 unchanged sentences
Under the supervision of and with the participation of our principal executive officer and principal financial
−Removed: officer, our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2022 based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated Framework (2013).
+Added: officer, our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2023 based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated Framework (2013).
Based on this assessment, management concluded that our internal control over financial reporting was effective as of December 31, 2023.
−Removed: This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm on internal control over financial reporting due to an exemption established by the JOBS Act for “emerging growth companies.”
−Removed: Remediation of Previously Reported Material Weaknesses
−Removed: The material weaknesses related to our finance and accounting staff and segregation of duties that were previously reported in Item 9A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and 2020 and are described in "Risk factors" section of the Annual Report on Form 10-K were remediated during our fiscal year ended December 31, 2022, and we determined that we maintained effective internal controls over our financial reporting as of December 31, 2022.
−Removed: Management took significant steps to remediate the control deficiencies that led to the material weaknesses and has been actively engaged in remediating the previously identified material weaknesses.
−Removed: The following remedial actions have been taken during the year ended December 31, 2022:
−Removed: In September 2022, we hired a new Chief Financial Officer with prior experience serving as a chief financial and accounting officer of several public companies who also served ten years in a major public accounting firm.
−Removed: We hired a Controller in November 2021 with experience working at a public company and as a manager at a major public accounting firm.
−Removed: Each of the above personnel have technical accounting expertise and experience with the internal control, compliance and financial reporting requirements of companies subject to PCAOB standards.
−Removed: We strengthened supervisory reviews by our financial management.
−Removed: We expanded our accounting and finance team to add additional qualified accounting and finance resources, including augmenting our finance team with third-party consultants that possess the required expertise to assist management with their review, as necessary.
−Removed: We implemented Oracle NetSuite as our Enterprise Resource Planning (ERP) solution in the third quarter of 2022, which among other features, has automated segregation of duties functionality relating to the ability to create and post journal entries to our general ledger.
−Removed: We implemented a Software-as-a-Service (SAAS) solution to assist with the review and approval of account reconciliations and other financial close workflows.
−Removed: We enhanced business process narratives and identification of key controls in our SOX framework.
−Removed: We performed internal interim and year-end SOX assessments that did not result in the identification of any material weaknesses related to the design or operating effectiveness of identified key controls.
−Removed: We believe the above actions were effective and concluded that the material weaknesses described above were remediated as of December 31, 2022.
−Removed: The process of implementing an effective financial reporting system is a continuous effort that requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to maintain a financial reporting system that is adequate to satisfy our reporting obligations.
+Added: This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm on internal control over financial reporting due to an exemption established by the JOBS Act for “emerging growth companies.”
Changes in Internal Control Over Financial Reporting
−Removed: Except for the remedial actions described above, there was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15(d)-15(f) under the Exchange Act) that occurred during the three months ended December 31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting
+Added: There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15(d)-15(f) under the Exchange Act) that occurred during the three months ended December 31, 2023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Other Information.
−Removed: Disclosure Regarding Foreign Jurisdictions that Prevent Inspection.
+Added: During the three month period ended December 31, 2023 , none of our directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended) adopted , terminated or modified a Rule 10b5-1 trading arrangement or any “non-Rule 10b5-1 trading agreement” (as defined in Item 408(c) of Regulation S-K).
+Added: Disclosure Regarding Foreign Jurisdictions that Prevent Inspections .
Not applicable.
Directors, Executive Officers and Corporate Governance.
−Removed: The information required by this Item 10 will be included in our Definitive Proxy Statement to be filed with the Securities and Exchange Commission, or SEC, with respect to our 2023 Annual Meeting of Stockholders and is incorporated herein by reference.
+Added: The information required by this Item 10 will be included in our Definitive Proxy Statement to be filed with the Securities and Exchange Commission (SEC) with respect to our 2024 Annual Meeting of Stockholders and is incorporated herein by reference.
Executive Compensation.
4 unchanged sentences
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 2024 Annual Meeting of Stockholders and is incorporated herein by reference.
−Removed: Principal Accounting Fees and Services.
+Added: Principal Accountant Fees and Services .
Our independent public accounting firm is KPMG LLP, Boston, Massachusetts, PCAOB Auditor ID 185 .
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 2024 Annual Meeting of Stockholders and is incorporated herein by reference.
−Removed: Exhibits, Financial Statement Schedules.
+Added: Exhibits and Financial Statement Schedules.
For a list of the financial statements included herein, see Index to the Consolidated Financial Statements on page F-1 of this Annual Report on Form 10-K, incorporated into this Item by reference.
1 unchanged sentence
Amended and Restated Certificate of Incorporation of Candel Therapeutics, Inc.
−Removed: (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 30, 2021)
+Added: (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 30, 2021)
Amended and Restated Bylaws of Candel Therapeutics, Inc.
−Removed: (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 30, 2021)
−Removed: Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 30, 2021)
+Added: Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
Description of Securities (incorporated by reference to Exhibit 4.2 to the Registrant's Annual Report on Form 10-K filed with the SEC on March 29, 2022)
−Removed: Investors’
−Removed: Rights Agreement (incorporated by reference to Exhibit 4.2 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: Investors’ Rights Agreement (incorporated by reference to Exhibit 4.2 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on June 25, 2021)
−Removed: Form of November 2018 Unconditional Warrant to Purchase Common Stock (incorporated by reference to Exhibit 4.3 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: Form of November 2018 Unconditional Warrant to Purchase Common Stock (incorporated by reference to Exhibit 4.3 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
−Removed: Form of November 2018 Conditional Warrant to Purchase Common Stock (incorporated by reference to Exhibit 4.4 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: Form of November 2018 Conditional Warrant to Purchase Common Stock (incorporated by reference to Exhibit 4.4 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
−Removed: Form of Warrant to Purchase Series A Convertible Preferred Stock (incorporated by reference to Exhibit 4.5 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: Form of Warrant to Purchase Series A Convertible Preferred Stock (incorporated by reference to Exhibit 4.5 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on June 25, 2021)
−Removed: 2015 Stock Plan, as amended, and forms of award agreements thereunder (incorporated by reference to Exhibit 10.1 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: 2015 Stock Plan, as amended, and forms of award agreements thereunder (incorporated by reference to Exhibit 10.1 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
−Removed: 2021 Stock Option and Incentive Plan and forms of award agreements thereunder (incorporated by reference to Exhibit 10.2 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: 2021 Stock Option and Incentive Plan and forms of award agreements thereunder (incorporated by reference to Exhibit 10.2 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
−Removed: Senior Executive Cash Incentive Bonus Plan (incorporated by reference to Exhibit 10.3 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: Senior Executive Cash Incentive Bonus Plan (incorporated by reference to Exhibit 10.3 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
−Removed: Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.4 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.4 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
1 unchanged sentence
d/b/a Candel Therapeutics and Paul Peter Tak, M.D., Ph.D.
−Removed: dated September 12, 2020 (incorporated by reference to Exhibit 10.5.1 to the Registrant’s Registration Statement on Form S-1/A (File No.
−Removed: 333- 257444) filed with the SEC on July 16, 2021)
−Removed: Amended and Restated Employment Agreement by and between Advantagene, Inc.
−Removed: and Estuardo Aguilar-Cordova dated November 13, 2018 (incorporated by reference to Exhibit 10.5.2 to the Registrant’s Registration Statement on Form S-1/A (File No.
−Removed: 333- 257444) filed with the SEC on July 16, 2021)
−Removed: Amended and Restated Employment Agreement by and between Advantagene, Inc.
−Removed: and Laura Aguilar, M.D., Ph.D.
−Removed: dated November 13, 2018 (incorporated by reference to Exhibit 10.5.3 to the Registrant’s Registration Statement on Form S-1/A (File No.
−Removed: 333- 257444) filed with the SEC on July 16, 2021)
−Removed: Employment Agreement by and between Advantagene, Inc.
−Removed: d/b/a Candel Therapeutics and John Canepa dated December 1, 2020 (incorporated by reference to Exhibit 10.5.4 to the Registrant’s Registration Statement on Form S-1/A (File No.
−Removed: 333- 257444) filed with the SEC on July 16, 2021)
−Removed: Employment Agreement by and between Advantagene, Inc.
−Removed: d/b/a Candel Therapeutics and Nathan Caffo dated September 24, 2020 (incorporated by reference to Exhibit 10.5.5 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: dated September 12, 2020 (incorporated by reference to Exhibit 10.5.1 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
−Removed: Form of Indemnification Agreement (incorporated by reference to Exhibit 10.6 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: Form of Indemnification Agreement (incorporated by reference to Exhibit 10.6 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
Exclusive License Agreement by and between Advantagene, Inc.
−Removed: and Ventagen, LLC dated March 1, 2014 (incorporated by reference to Exhibit 10.7 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: and Ventagen, LLC dated March 1, 2014 (incorporated by reference to Exhibit 10.7 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
Exclusive License Agreement by and between Advantagene, Inc., d/b/a Candel Therapeutics and Periphagen, Inc.
−Removed: dated December 9, 2019 (incorporated by reference to Exhibit 10.8 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: dated December 9, 2019 (incorporated by reference to Exhibit 10.8 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
Exclusive Patent License Agreement by and between Advantagene, Inc.
−Removed: and Mass General Brigham (formerly known as The Brigham and Women’s Hospital, Inc.) dated September 15, 2020 (incorporated by reference to Exhibit 10.7 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: and Mass General Brigham (formerly known as The Brigham and Women’s Hospital, Inc.) dated September 15, 2020 (incorporated
+Added: by reference to Exhibit 10.9 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
−Removed: Lease of Premises at 117 Kendrick Street, Needham, Massachusetts by and between 117 Kendrick DE, LLC and the Registrant dated as of February 4, 2019 (incorporated by reference to Exhibit 10.7 to the Registrant’s Registration Statement on Form S-1/A (File No.
+Added: Lease of Premises at 117 Kendrick Street, Needham, Massachusetts by and between 117 Kendrick DE, LLC and the Registrant dated as of February 4, 2019 (incorporated by reference to Exhibit 10.10 to the Registrant’s Registration Statement on Form S-1/A (File No.
333- 257444) filed with the SEC on July 16, 2021)
3 unchanged sentences
and Susan Stewart dated October 19, 2021 (incorporated by reference to Exhibit 10.13 to the Registrant's Annual Report on Form 10-K filed with the SEC on March 29, 2022)
−Removed: Employment Agreement by and between Candel Therapeutics and Seshu Tyagarajan dated April 14, 2022 (incorporated by reference to Exhibit 10.8 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on May 12, 2022)
+Added: Employment Agreement by and between Candel Therapeutics and Seshu Tyagarajan dated April 14, 2022 (incorporated by reference to Exhibit 10.8 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on May 12, 2022)
Employment Agreement by and between Candel Therapeutics and Jason A.
−Removed: Amello dated September 21, 2022 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 10, 2022)
−Removed: Master Production Services Agreement by and between Candel Therapeutics and SAFC Carlsbad, Inc., effective November 3, 2022
+Added: Amello dated September 21, 2022 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 10, 2022)
+Added: Master Production Services Agreement by and between Candel Therapeutics and SAFC Carlsbad, Inc., effective November 3, 2022 (incorporated by reference to Exhibit 10.16 to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 30, 2023)
+Added: Amendment to Exclusive License Agreement by and between Candel Therapeutics, Inc.
+Added: and Periphagen, Inc.
+Added: dated June 7, 2023 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 10, 2023)
+Added: First Amendment to Loan and Security Agreement by and between Candel Therapeutics, Inc.
+Added: and Silicon Valley Bank, dated June 14, 2023 (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 10, 2023)
+Added: Consulting by and between Candel Therapeutics, Inc.
+Added: Amello, dated as of January 12, 2024
List of Subsidiary (incorporated by reference to Exhibit 21.1 to the Registrant's Annual Report on Form 10-K filed with the SEC on March 29, 2022)
Consent of KPMG LLP, Independent Registered Public Accounting Firm
+Added: Power of Attorney (included on signature page)
Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
2 unchanged sentences
Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
−Removed: Inline XBRL Instance Document –
−Removed: the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.
+Added: Compensation Recovery Policy
+Added: Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.
Inline XBRL Taxonomy Extension Schema Document
7 unchanged sentences
# Indicates a management contract or any compensatory plan, contract or arrangement
+Added: ** Portions of this exhibit have been omitted by means of redacting a portion of the text and replacing it with “[***]” because they are both (i) not material and (ii) the type of information that the Registrant treats as private or confidential.
Form 10-K Summary
+Added: Not applicable.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
2 unchanged sentences
Consolidated Statements of Operations
−Removed: Consolidated Statements of Convertible Preferred Stock and Stockholders’
−Removed: Equity (Deficit)
+Added: Consolidated Statements of Stockholders’ Equity
Consolidated Statements of Cash Flows
5 unchanged sentences
We have audited the accompanying consolidated balance sheets of Candel Therapeutics, Inc.
−Removed: and subsidiary (the Company) as of December 31, 2022 and 2021, the related consolidated statements of operations, convertible preferred stock and stockholders’
−Removed: equity (deficit), and cash flows for each of the years in the two-year period ended December 31, 2022, and the related notes (collectively, the consolidated financial statements).
−Removed: In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2022, in conformity with U.S.
+Added: and subsidiary (the Company) as of December 31, 2023 and 2022, the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years ended December 31, 2023, and the related notes (collectively, the consolidated financial statements).
+Added: In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the years then ended, in conformity with U.S.
generally accepted accounting principles.
−Removed: Change in Accounting Principle
−Removed: As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting for leases as of January 1, 2022 due to the adoption of Accounting Standards Update No.
−Removed: 2016-02, Leases (Topic 842) and Accounting Standards Update No.
−Removed: 2018-11, Leases (Topic 842):
−Removed: Targeted Improvements.
+Added: Going Concern
+Added: The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.
+Added: As discussed in Note 1 to the consolidated financial statements, the Company has an accumulated deficit, has incurred operating losses and negative cash flows from operations since inception and expects to continue to incur such losses and negative cash flows into the foreseeable future which raises substantial doubt about its ability to continue as a going concern.
+Added: Management’s plans in regard to these matters are also described in Note 1.
+Added: The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
−Removed: These consolidated financial statements are the responsibility of the Company’s management.
+Added: These consolidated financial statements are the responsibility of the Company’s management.
Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
4 unchanged sentences
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.
−Removed: 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.
+Added: 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.
3 unchanged sentences
We believe that our audits provide a reasonable basis for our opinion.
−Removed: We have served as the Company’s auditor since 2019
+Added: We have served as the Company’s auditor since 2019
Boston, Massachusetts
10 unchanged sentences
Restricted cash
−Removed: Liabilities and Stockholders’
+Added: Liabilities and Stockholders’ Equity
Current liabilities:
1 unchanged sentence
Accrued expenses
+Added: Current portion of term loan payable to a bank
Current portion of lease liability
2 unchanged sentences
Deferred revenue
−Removed: Deferred rent
Term loan payable to a bank
4 unchanged sentences
Commitments and contingencies (Note 15)
−Removed: Stockholders’
+Added: Stockholders’ equity:
Preferred stock, $ 0.01 par value;
8 unchanged sentences
Accumulated deficit
−Removed: Total stockholders’
−Removed: Total liabilities and stockholders’
+Added: Total stockholders’ equity
+Added: Total liabilities and stockholders’ equity
The accompanying notes are an integral part of these consolidated financial statements.
10 unchanged sentences
Other income (expense):
−Removed: Interest and dividend income (expense), net
+Added: Interest income
+Added: Interest expense
Change in fair value of warrant liability
Total other income (expense), net
+Added: Net loss and comprehensive loss
Net loss per share, basic and diluted
1 unchanged sentence
The accompanying notes are an integral part of these consolidated financial statements.
−Removed: Candel Thrapeutics, Inc.
−Removed: Consolidated Statements of Convertible Preferred Stock and Stockholders’
−Removed: Equity (Deficit)
+Added: Candel ThErapeutics, Inc.
+Added: Consolidated Statements of Stockholders’ Equity
(In thousands, except share and per share amounts)
−Removed: PREFERRED STOCK
−Removed: PREFERRED STOCK
TREASURY STOCK
PAID-IN CAPITAL
−Removed: STOCKHOLDERS’
−Removed: EQUITY (DEFICIT)
−Removed: Balance as of
−Removed: December 31, 2020
+Added: STOCKHOLDERS’
+Added: Balance as of December 31, 2021
Options exercised
−Removed: Warrants exercised
+Added: Treasury stock acquired
Stock-based compensation
1 unchanged sentence
NC Ohio Trust Warrants
−Removed: Conversion of Series B
−Removed: Preferred Stock to
−Removed: Conversion of Series C
−Removed: Preferred Stock to
−Removed: Proceeds from IPO, net
−Removed: Balance as of
−Removed: December 31, 2021
−Removed: Options exercised
−Removed: Treasury stock acquired
+Added: Balance as of December 31, 2022
Stock-based compensation
+Added: Restricted stock unit vesting, net
+Added: of shares withheld for taxes
Change in fair value of
NC Ohio Trust Warrants
−Removed: Balance as of
−Removed: December 31, 2022
+Added: Balance as of December 31, 2023
The accompanying notes are an integral part of these consolidated financial statements.
4 unchanged sentences
Adjustments to reconcile net loss to net cash used in operating activities:
−Removed: Depreciation and amortization
−Removed: Impairment on manufacturing equipment
+Added: Depreciation expense
+Added: Impairment of fixed assets
+Added: Loss on the sale of fixed assets
Non-cash stock compensation expense
3 unchanged sentences
Accretion of debt discount
−Removed: Paycheck protection program loan forgiveness
Changes in operating assets and liabilities:
Prepaid expenses and other current assets
−Removed: Other long term assets
Accounts payable
1 unchanged sentence
Deferred revenue
−Removed: Deferred rent
Lease liability
2 unchanged sentences
Purchase of fixed assets
+Added: Proceeds from the sale of fixed assets
Net cash used in investing activities
Cash Flows from Financing Activities:
−Removed: Net proceeds from initial public offering
Net proceeds from bank term loan
+Added: Payments related to tax withholding for vested restricted stock units
Proceeds from option exercises
−Removed: Proceeds from warrant exercises
−Removed: Net cash provided by financing activities
−Removed: Net increase (decrease) in cash
+Added: Net cash (used in) provided by financing activities
+Added: Net decrease in cash
Cash, cash equivalents and restricted cash at beginning of period
12 unchanged sentences
Candel Therapeutics, Inc., formerly known as Advantagene, Inc.
−Removed: (the Company) is a late clinical stage biotechnology company that was incorporated in Delaware in June 2003.
+Added: (the Company), is a clinical stage biopharmaceutical company that was incorporated in Delaware in June 2003.
On November 30, 2020, the Company changed its name to Candel Therapeutics, Inc.
−Removed: The Company is focused on developing and commercializing viral immunotherapies to help patients fight cancer.
−Removed: The Company’s engineered viruses are designed to induce immunogenic cell death through direct viral –
−Removed: mediated cytotoxicity in cancer cells, thus releasing tumor neo-antigens and creating a pro-inflammatory microenvironment at the site of injection.
−Removed: The Company has established two clinical stage viral immunotherapy platforms and its two product candidates, CAN-2409 and CAN-3110, are in clinical trials for a number of tumor types.
−Removed: In addition, the Company recently announced a collaboration with the University of Pennsylvania (Penn) to study the impact of novel viral immunotherapies based on Candel's propriety enLIGHTEN Discovery Platform to strengthen the effects of Penn's investigational CAR-T cell therapies in solid tumor models.
+Added: The Company is focused on developing off-the-shelf viral immunotherapies that elicit an individualized, systemic anti-tumor immune response to help patients fight cancer.
+Added: The Company’s engineered viruses are designed to induce immunogenic cell death through direct viral-mediated cytotoxicity in cancer cells, thus releasing tumor neo-antigens and creating a pro-inflammatory microenvironment at the site of injection.
+Added: This is intended to lead to in-situ vaccination against the injected tumor and uninjected distant metastases.
+Added: The Company has established two off-the-shelf viral immunotherapy platforms and its two product candidates, CAN-2409 and CAN-3110, are in clinical trials for a number of tumor types.
+Added: Additionally, the Company and the University of Pennsylvania (UPenn) are collaborating to study the impact of novel viral immunotherapies based on Candel's propriety enLIGHTEN Discovery Platform, a systematic, iterative herpes simplex virus based platform leveraging human biology and advanced analytics, to strengthen the effects of UPenn's investigational CAR-T cell therapies in solid tumors.
The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations and the ability to secure additional capital to fund operations.
1 unchanged sentence
These efforts require significant amounts of additional capital, adequate personnel and infrastructure and extensive compliance-reporting capabilities.
−Removed: Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will realize revenue from product sales.
−Removed: The Company has funded its operations primarily with proceeds from the sale of its convertible notes and capital stock and from debt borrowings.
+Added: Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will realize revenue from product sales.
+Added: Since inception, the Company has funded its operations primarily with proceeds from the sale of its convertible notes and capital stock and from debt borrowings.
The Company has incurred recurring losses since its inception, including a net loss of $ 37.9 million and $ 18.8 million for the years ended December 31, 2023, and 2022, respectively.
In addition, as of December 31, 2023, the Company had an accumulated deficit of $ 137.0 million .
−Removed: The Company expects to continue to generate operating losses for the foreseeable future.
−Removed: On July 29, 2021, the Company completed its initial public offering of common stock (the IPO) at which time the Company issued 9,000,000 shares of its common stock at a price to the public of $ 8.00 per share, and on August 13, 2021, the Company issued an additional 887,994 shares of common stock at $ 8.00 per share as a partial exercise of the underwriters’
−Removed: option to purchase additional shares, resulting in net proceeds to the Company of $ 71.3 million , after deducting underwriting discounts and commissions and offering expenses.
−Removed: Upon closing of the IPO, all outstanding shares of the Company’s convertible preferred stock automatically converted into 7,066,398 shares of common stock.
−Removed: On August 5, 2022, the Company filed a shelf registration statement on Form S-3 (the Shelf) with the SEC, which covers the offering, issuance, and sale by us of up to an aggregate of $ 200.0 million of our common stock, preferred stock, debt securities, warrants and/or units of any combination thereof.
−Removed: We simultaneously entered into a sales agreement with Jefferies LLC, as sales agent, to provide for the issuance and sale by us of up to $ 75.0 million of our common stock from time to time in “at-the-market”
−Removed: offerings under the Shelf (the ATM Program).
+Added: The Company expects to continue to generate operating losses and negative cash flows from operations for the foreseeable future.
+Added: On August 5, 2022, the Company filed a shelf registration statement on Form S-3 (as amended to date, the Shelf) with the SEC, which covers the offering, issuance, and sale by us of up to an aggregate of $ 200.0 million of our common stock, preferred stock, debt securities, warrants and/or units of any combination thereof.
+Added: We simultaneously entered into a sales agreement with Jefferies LLC, as sales agent, to provide for the issuance and sale by us of up to $ 75.0 million of our common stock from time to time in “at-the-market” offerings under the Shelf (the ATM Program).
The Shelf was declared effective by the SEC on August 12, 2022.
−Removed: As of the date hereof, no sales have been made pursuant to the ATM Program.
−Removed: The future viability of the Company is dependent on its ability to raise additional capital to finance its operations.
−Removed: The Company’s inability to raise capital as and when needed could have a negative impact on its financial condition and ability to pursue its business strategies.
−Removed: There can be no assurances that additional funding will be available on terms acceptable to the Company, or at all.
−Removed: The Company believes that existing resources will fund planned operations for at least 12 months from the date that these consolidated financial statements were available to be issued.
−Removed: Accordingly, the consolidated financial statements have been prepared on a basis that assumes the Company continues as a going concern and contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.
+Added: Subsequent to December 31, 2023 and through March 21, 2024, we have sold and issued 109,485 shares of common stock under the ATM Program, with total net proceeds of $ 0.2 million .
+Added: The Company’s cash and cash equivalents were $ 35.4 million as of December 31, 2023.
+Added: In accordance with the Financial Accounting Standards Board (FASB) Accounting Standards Codification, 205-40, Presentation of Financial Statements - Going Concern, management is required to assess the Company’s ability to continue as a going concern for the one-year look forward period following the date that the consolidated financial statements are issued.
+Added: The Company's expects to continue to generate operating losses and negative cash flows from operations.
+Added: Based on these conditions, the Company has determined that substantial doubt exists regarding its ability to continue as a going concern for the one-year period following the date these consolidated financial statements are issued.
+Added: To sustain its future operations beyond such one-year period, the Company will require additional funding.
+Added: The Company expects to finance its cash needs through a combination of public or private equity or debt financings, government grants, and other sources, which may include collaborations, strategic alliances and licensing arrangements with third parties.
+Added: There is no assurance that the Company will be successful in obtaining sufficient funding on acceptable terms, if at all, and the Company could be forced to delay, reduce, or eliminate some or all of its research, clinical trials, product development or future commercialization efforts, which could materially adversely affect its business prospects or its ability to continue as a going concern.
+Added: The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
+Added: Accordingly, the consolidated financial statements have been prepared on a basis that assumes the Company will continue as a going concern and that contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.
Summary of Significant Accounting Policies
1 unchanged sentence
The accompanying consolidated financial statements have been prepared in accordance with accounting standards set by the Financial Accounting Standards Board (FASB).
−Removed: The FASB sets generally accepted accounting principles (GAAP) that the Company follows to ensure its financial condition, results of operations, and cash flows are consistently
+Added: The FASB sets generally accepted accounting principles (GAAP) that the Company follows to ensure its financial condition, results of operations, and cash flows are consistently reported.
References to GAAP issued by the FASB in these notes to the financial statements are to the FASB Accounting Standards Codification (ASC).
+Added: The Company has reclassified certain amounts relating to its prior period results to conform to its current period presentation.
Principles of Consolidation
12 unchanged sentences
Use of Estimates
−Removed: The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and related disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenue and expenses during the reporting period.
−Removed: On an ongoing basis, the Company’s management evaluates its estimates, which include but are not limited to management’s judgments of accrued expenses, valuation of stock-based option awards, valuations of warrants, and income taxes.
+Added: The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and related disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenue and expenses during the reporting period.
+Added: On an ongoing basis, the Company’s management evaluates its estimates, which include but are not limited to management’s judgments of accrued expenses, valuation of stock-based option awards, valuations of warrants, and income taxes.
Actual results could differ from those estimates.
−Removed: Prior to the IPO, the Company utilized significant estimates and assumptions in determining the fair value of its common stock.
−Removed: The Company has utilized various valuation methodologies in accordance with the framework of the American Institute of Certified Public Accountants Technical Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation (the Practice Aid), to estimate the fair value of its common stock and warrants.
−Removed: Each valuation methodology includes estimates and assumptions that require the Company’s judgment.
−Removed: These estimates and assumptions include a number of objective and subjective factors, including external market conditions, the prices at which the Company sold shares of preferred stock, the superior rights and preferences of securities senior to the Company’s common stock at the time of, and the likelihood of, achieving a liquidity event, such as an initial public offering or sale.
−Removed: Significant changes to the key assumptions used in the valuations could result in different fair values of common stock at each valuation date.
Cash and Cash Equivalents
−Removed: The Company considers all highly liquid investments purchased with original final maturities of 90 days or less from the date of purchase to be cash equivalents.
−Removed: Cash and cash equivalents comprise marketable securities with maturities of less than 90 days when purchased.
+Added: The Company considers all highly liquid investments purchased with original final maturities of three months or less from the date of purchase to be cash equivalents.
+Added: Cash and cash equivalents comprise marketable securities with maturities of less than three months when purchased.
Cash equivalents are reported at fair value.
Restricted Cash
−Removed: The Company has $ 0.3 million and $ 0.4 million of restricted cash as of December 31, 2022 and 2021 , respectively, which represents cash held as a security deposit under the terms of the Company’s Needham, Massachusetts facility lease and at December 31, 2021, as security for the Company credit card.
+Added: The Company had $ 0.3 million of restricted cash as of both December 31, 2023 and 2022 , which represents cash held as a security deposit under the terms of the Company’s Needham, Massachusetts facility lease.
Fair Value Measurements
1 unchanged sentence
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.
−Removed: Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the
−Removed: use of unobservable inputs.
+Added: Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs.
Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:
−Removed: Level 1—Quoted prices in active markets for identical assets or liabilities.
−Removed: Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.
−Removed: Level 3—Unobservable inputs that are supported by little or no market activity that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.
−Removed: The carrying values of cash and cash equivalents (considered as Level 1 measurement), accounts payable, and accrued expenses approximate their fair values due to the short-term nature of these assets and liabilities.
−Removed: The Company’s warrant liability is carried at fair value and is classified as Level 3 measurement.
+Added: • Level 1—Quoted prices in active markets for identical assets or liabilities.
+Added: • Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.
+Added: • Level 3—Unobservable inputs that are supported by little or no market activity that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.
+Added: The carrying values of cash and cash equivalents (considered as Level 1 measurements), accounts payable, and accrued expenses approximate their fair values due to the short-term nature of these assets and liabilities.
+Added: The carrying value of the Company's term loan approximates fair value due to the variable interest rate.
+Added: The Company’s warrant liability is carried at fair value and is classified as Level 3 measurement.
Property and Equipment
12 unchanged sentences
The Company determines if an arrangement is, or contains, a lease at inception.
−Removed: Lease right of use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease.
+Added: Lease right of use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease.
Lease right of use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments to be made over the lease term.
The lease right of use asset is equal to the lease liability and adjusted for prepaid rent, initial direct costs, and incentives.
−Removed: As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments.
+Added: As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments.
The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.
3 unchanged sentences
Concentrations of Credit Risk
−Removed: Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents and marketable securities.
−Removed: Periodically, the Company maintains deposits and investments in accredited financial institutions in-excess of the federally insured limits.
+Added: Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents.
+Added: Periodically, the Company maintains deposits in accredited financial institutions in-excess of the federally insured limits.
The Company deposits its cash in financial institutions with a high credit quality and has not experienced any losses on such accounts and does not believe it is exposed to any unusual credit risk beyond the normal risk associated with commercial banking relationships.
2 unchanged sentences
Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets.
−Removed: If an impairment review is performed to evaluate a long-lived asset group for recoverability, the Company compares forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long-lived asset group to its carrying value.
+Added: If an impairment review is performed to evaluate a long-lived asset group for recoverability, the
+Added: Company compares forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long-lived asset group to its carrying value.
An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of an asset group are less than its carrying amount.
1 unchanged sentence
Long-lived assets consist of fixed assets and operating lease assets.
−Removed: In the fourth quarter of 2021, the Company recorded an impairment charge of approximately $ 0.6 million related to manufacturing equipment that the Company does not plan to use for its intended use and recorded a reserve to reduce the carrying value to its estimated realizable value.
−Removed: The Company has not recorded any additional impairment losses on such long-lived assets.
+Added: In the third and fourth quarters of 2023, the Company recorded impairment charges totaling approximately $ 0.4 million related to manufacturing equipment that the Company has determined it does not plan to use for its intended use, and the Company recorded an impairment to reduce the carrying value to its estimated fair value.
+Added: The Company has not recorded any other impairment losses on such long-lived assets.
Revenue Recognition
23 unchanged sentences
Stock-Based Compensation
−Removed: The Company accounts for its stock-based compensation in accordance with ASC Topic 718, Compensation—Stock Compensation (ASC 718).
+Added: The Company accounts for its stock-based compensation in accordance with ASC Topic 718, Compensation—Stock Compensation (ASC 718).
ASC 718 requires all share-based payments to employees and directors to be recognized as expense in the consolidated statements of operations based on their grant date fair values.
In addition, in accordance with FASB Accounting Standards Update (ASU) 2016-09 which identifies areas for simplification of several areas of share-based payment transactions, the Company treats non-employee grants the same as employee grants.
−Removed: Company estimates the fair value of options granted using the Black-Scholes option pricing model for stock option grants to both employees and non-employees.
+Added: The Company estimates the fair value of options granted using the Black-Scholes option pricing model for stock option grants to both employees and non-employees.
The Company believes the fair value of the stock options granted to non-employees is more reliably determinable than the fair value of the services provided.
The Black-Scholes option pricing model requires inputs based on certain subjective assumptions, including (a) the expected stock price volatility, (b) the expected term of the award, (c) the risk-free interest rate and (d) expected dividends.
−Removed: Due to a lack of company-specific historical and implied volatility data, the Company has based its computation of expected volatility on the historical volatility of a representative group of public companies with similar characteristics to the Company, including stage of product development and life science industry focus.
+Added: Due to a lack of company-specific historical and implied volatility data, the Company has based its computation of expected volatility on a combination of the historical volatility of the Company and of a representative group of public companies with similar characteristics to the Company, including stage of product development and life science industry focus.
The historical volatility is calculated based on a period of time commensurate with the expected term assumption.
5 unchanged sentences
The expected dividend yield is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock.
−Removed: Prior to the IPO, there were significant judgments and estimates inherent in the determination of the fair value of the Company’s common stock.
−Removed: These estimates and assumptions included a number of objective and subjective factors, including external market conditions, the prices at which the Company sold shares of preferred stock, the superior rights and preferences of securities senior to its common stock at the time of, and the likelihood of, achieving a liquidity event, such as an initial public offering or sale.
The Company generally expenses the fair value of its share-based compensation awards to employees and non-employees on a straight-line basis over the requisite service period, which is generally the vesting period.
Government Grants
−Removed: The Company has applied for grants for the reimbursement of expenditures with the National Institutes of Health (NIH) and the Massachusetts Life Sciences Center for certain qualified operating expenditures, including employee-related costs.
+Added: The Company has applied for grants for the reimbursement of expenditures with the Massachusetts Life Sciences Center for certain qualified operating expenditures, including employee related costs.
The Company recognizes government grants when there is reasonable assurance that the Company will comply with the conditions attached to the grant arrangement and the grant will be received.
−Removed: Government grants for research and development efforts are recorded as grant income and classified in other income in the consolidated statements of operations.
−Removed: The Company recognized government grants of $ 48,000 and $ 1.1 million for the years ended December 31, 2022 and 2021 , respectively.
+Added: Government grants are recorded as grant income and classified in other income in the consolidated statements of operations.
+Added: The Company recognized government grants of zero and $ 48,000 for the years ended December 31, 2023 and 2022 , respectively.
Grant income is recognized as a component of other income/(expense), net in the consolidated statements of operations.
−Removed: The Company's grant with the NIH was completed at the end of 2021.
−Removed: The Company's grant with the Massachusetts Life Sciences Center began in 2022.
−Removed: The Company accounts for income taxes using the asset and liability method in accordance with ASC Topic 740, Income Taxes (ASC 740) which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the financial statements or in the Company’s tax returns.
+Added: The Company accounts for income taxes using the asset and liability method in accordance with ASC Topic 740, Income Taxes (ASC 740) which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the financial statements or in the Company’s tax returns.
Deferred tax assets and liabilities are determined on the basis of the differences between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.
7 unchanged sentences
The amount of benefits that may be used are the largest amounts that have a greater than 50 % likelihood of being realized upon ultimate settlement.
−Removed: The provision for income taxes includes the effects of
−Removed: any resulting tax reserves or unrecognized tax benefits that are considered appropriate as well as the related net interest received.
+Added: The provision for income taxes includes the effects of any resulting tax reserves or unrecognized tax benefits that are considered appropriate as well as the related net interest received.
Net Loss Per Share
2 unchanged sentences
In periods where the Company reports a net loss attributable to common stockholders, diluted net loss per share is the same as basic net loss per share, since dilutive shares of common stock are not assumed to have been issued if their effect is anti-dilutive.
−Removed: Diluted net loss per share is the same as basic net loss per share for the years ended December 31, 2022 and 2021 since all potential shares of common stock instruments are anti-dilutive as a result of the loss for such periods.
−Removed: Recently Adopted Accounting Standards
−Removed: In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (ASU 2016-02), as amended by various subsequently issued ASUs.
−Removed: The standard requires lessees to recognize an operating lease with a term greater than one year on their balance sheets as a right-of-use asset and corresponding lease liability, measured at the present value of the lease payments.
−Removed: Lessees are required to classify leases as either finance or operating leases.
−Removed: If the lease is effectively a financed purchase by the lessee, it is classified as a financing lease, otherwise it is classified as an operating lease.
−Removed: This classification will determine the pattern of recognition of lease cost on our consolidated statement of operations over the term of the lease.
−Removed: In July 2018, the FASB also issued ASU 2018-11, Leases (Topic 842):
−Removed: Targeted Improvements (ASU 2018-11), which permits entities to continue applying legacy guidance in ASC 840, Leases, including its disclosure requirements, in the comparative periods presented in the year that the entity adopts the new leasing standard.
−Removed: The Company elected the package of practical expedients permitted under the transition guidance within the standard.
−Removed: Accordingly, the Company did not reassess the conclusion of whether the existing arrangements contain a lease, lease classification and initial direct costs under ASC 842.
−Removed: In June 2020, the FASB also issued ASU 2020-05, Revenue from contracts with customers (Topic 606) and Leases (Topic 842):
−Removed: effective dates for certain entities, which deferred the effective date certain entities were required to adopt ASC 842.
−Removed: The update extended the effective date for adoption of ASC 842 until fiscal years beginning after December 15, 2021.
−Removed: As an emerging growth company we were not required to adopt ASC 842 until January 1, 2022.
−Removed: The Company adopted the standard on January 1, 2022 using the effective date method.
−Removed: As such, the consolidated balance sheets and statements of operations for prior periods will not be comparable in the year of adoption of ASC 842.
−Removed: As a result of the adoption of ASC 842, the Company recorded a lease right of use asset of $ 1.3 million and a lease liability of $ 2.4 million on the consolidated balance sheets as of January 1, 2022 related to an operating lease.
−Removed: The Company derecognized deferred rent liabilities, which makes up the difference between the lease right of use asset and lease liability.
−Removed: The adoption of the standard did not have a material impact on the Company’s consolidated statement of operations or consolidated statement of cash flows.
−Removed: In August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40).
−Removed: The guidance simplifies the complexity associated with applying U.S.
−Removed: GAAP for certain financial instruments with characteristics of liabilities and equity.
−Removed: This ASU (1) simplifies the accounting for convertible debt instruments and convertible preferred stock by removing guidance in ASC 470-20, Debt:
−Removed: Debt with Conversion and Other Options, that requires entities to account for beneficial conversion features and cash conversion features in equity, separately from the host convertible debt or preferred stock;
−Removed: (2) revises the scope exception from derivative accounting in ASC 815-40 for freestanding financial instruments and embedded features that are both indexed to the issuers own stock and classified in stockholders' equity, by removing certain criteria required for equity classification;
−Removed: and (3) revises the guidance in ASC 260, Earnings Per Share, to require entities to calculate diluted earnings per share for convertible instruments by using the if-converted method.
−Removed: As an emerging growth company, we are not required to adopt ASU 2020-06 until January 1, 2024, however early adoption is permitted.
−Removed: The Company elected to early adopt the standard on January 1, 2022 and upon adoption, there was no impact to our consolidated statement of operations and cash flows and our basic and diluted net loss per share amounts.
−Removed: In November 2021, the FASB issued ASU 2021-10, which created Topic 832, Government Assistance, which requires business entities to disclose information about certain government assistance they receive.
−Removed: The ASU requires qualitative and quantitative disclosures around the nature of transactions and related accounting policy used, the line items on the balance sheet and income statement that are affected, and the significant terms and conditions of the transactions.
−Removed: The ASU is effective for fiscal years beginning after December 15, 2021 .
−Removed: The Company believes its
−Removed: historical disclosure already met the requirements of the new standard.
−Removed: As such, no changes or additional disclosure was determined to be necessary .
+Added: Diluted net loss per share is the same
+Added: as basic net loss per share for the years ended December 31, 2023 and 2022 since all potential shares of common stock instruments are anti-dilutive as a result of the loss for such periods.
+Added: Recently Issued Accounting Standards
+Added: In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements:
+Added: Codification Amendments in Response to the SEC's Disclosure Update and Simplification Initiative, which modifies the disclosure or presentation requirements related to a variety of FASB Accounting Standard Codification topics.
+Added: The effective date for each amendment will be the date on which the SEC's removal of that related disclosure from Regulation S-X or Regulation S-K is effective, with early adoption prohibited.
+Added: If by June 30, 2027, the SEC has not removed the applicable requirement from Regulation S-X or Regulation S-K, the pending content of the associated amendment will be removed from the Codification and will not become effective for any entities.
+Added: The Company is currently evaluating the potential impact that ASU 2023-06 may have on its consolidated financial statements and related disclosures.
+Added: In November 2023, the FASB issued ASU 2023-07, Segment Reporting:
+Added: Improvements to Reportable Segment Disclosures, which amends guidance in ASC 280, Segment Reporting The amendments in this ASU expand segment disclosure requirements, including new segment disclosure requirements for entities with a single reportable segment, among other disclosure requirements.
+Added: The ASU’s amendments are effective for public business entities for annual periods beginning after December 15, 2023.
+Added: Early adoption is permitted.
+Added: The Company is currently evaluating the potential impact that the adoption of ASU 2023-07 may have have on its consolidated financial statements and related disclosures.
+Added: In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, which amends the guidance in ASC 740, Income Taxes.
+Added: The ASU is intended to improve the transparency of income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction.
+Added: It also includes certain other amendments to improve the effectiveness of income tax disclosures.
+Added: The ASU’s amendments are effective for public business entities for annual periods beginning after December 15, 2024.
+Added: Early adoption is permitted.
+Added: Adoption can be either prospectively or retrospectively applied, and the Company will adopt this ASU on a prospective basis.
+Added: The Company is currently evaluating the potential impact that ASU 2023-09 may have on its consolidated financial statements and related disclosures.
Fair Value of Financial Assets and Liabilities
−Removed: The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values (in thousands):
+Added: The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values (in thousands):
FAIR VALUE MEASUREMENTS AS OF
9 unchanged sentences
The hybrid method is often used when a company is expecting a liquidity event in the near future and is a combination of the option-pricing and probability-weighted expected return methods.
−Removed: Estimates and assumptions impacting the fair value measurement include the fair value per share of the underlying shares of common stock, risk-free interest rate, expected dividend yield, expected volatility of the price of the underlying common stock, and the remaining contractual term of the warrants.
−Removed: The most significant assumption in the model impacting the fair value of the common stock warrants is the fair value of the Company’s common stock as of each remeasurement date.
−Removed: Prior to the IPO, the Company determined the fair value per share of the underlying common stock by taking into consideration the most recent sales of preferred stock, results obtained from third-party valuations and additional factors that are deemed relevant.
−Removed: The following table provides a roll forward of the aggregate fair values of the Company’s warrant liability, for which fair value is determined by Level 3 inputs (in thousands):
+Added: Estimates and assumptions impacting the fair value measurement include the fair value per share of the underlying shares of common stock, risk-free interest rate, expected dividend yield, expected volatility of the price of the underlying common stock, and the
+Added: remaining contractual term of the warrants.
+Added: The most significant assumption in the model impacting the fair value of the common stock warrants is the fair value of the Company’s common stock as of each remeasurement date.
+Added: The following table provides a roll forward of the aggregate fair values of the Company’s warrant liability, for which fair value is determined by Level 3 inputs (in thousands):
Balance at December 31, 2021
11 unchanged sentences
Total fixed assets
−Removed: Less accumulated depreciation
+Added: accumulated depreciation
Fixed assets, net
−Removed: Depreciation and amortization expense was $ 0.8 million and $ 0.2 million for the years ended December 31, 2022 and 2021 , respectively.
+Added: Depreciation expense was $ 1.0 million and $ 0.8 million for the years ended December 31, 2023 and 2022 , respectively.
Accrued Expenses
5 unchanged sentences
The Company borrowed $ 20.0 million upon entering into the Loan Agreement.
−Removed: The Company could have borrowed up to an additional aggregate principal amount not to exceed $ 5.0 million, at any time on or prior to December 31, 2022, upon the achievement of all of the following milestones, inclusively:
−Removed: (a) positive Phase 2 clinical activity data from the Company’s CAN-2409 NSCLC clinical trial, (b) dosing of its first patient in its Phase 3 CAN-2409 high-grade glioma clinical trial;
−Removed: and (c) receipt on or prior to December 31, 2022, of net cash proceeds in an amount equal to at least $ 75.0 million from the issuance and sale of equity securities to investors acceptable to SVB.
+Added: The Company could have borrowed up to an additional aggregate principal amount not to exceed $ 5.0 million, at any time on or prior to December 31, 2022, upon achievement of all of the following milestones, inclusively:
+Added: (a) positive phase 2 clinical activity data from the Company’s CAN-2409 NSCLC clinical trial, (b) dosing of its first patient in its phase 3 CAN-2409 high-grade glioma clinical trial, and (c) receipt on or prior to December 31, 2022, of net cash proceeds in an amount equal to at least $ 75.0 million from the issuance and sale of equity securities to investors acceptable to SVB.
The Company did not borrow any of the additional aggregate principal amount on or prior to December 31, 2022.
−Removed: The term loan is secured by substantially all of the Company’s properties, rights and assets, except for its intellectual property, which is subject to a negative pledge under the Loan Agreement.
+Added: The term loan is secured by substantially all of the Company’s properties, rights and assets, except for its intellectual property, which is subject to a negative pledge under the Loan Agreement.
The term loans bear interest at a floating rate per annum equal to the greater of (A) 5.75 % and (B) the prime rate (as published in the money rates section of The Wall Street Journal) plus 2.50 %.
1 unchanged sentence
The term loans mature on January 1, 2026 .
−Removed: Upon repayment in full of the term loans, the Company will be required to pay a final payment fee equal to 4.50 % of the original principal amount of any funded term loan being repaid.
+Added: Upon repayment in full of the term loans, the Company will be required to pay a final payment fee equal to 4.50 % of the original principal amount of any funded term
+Added: loan being repaid.
The Loan Agreement permits voluntary prepayment of all, but not less than all, of the SVB term loans, subject to a prepayment premium of 1 % to 3 % based upon the timing of the repayment.
−Removed: During the year ended December 31, 2022 , the Company recorded interest expense relating to the Loan Agreement of $ 1.6 million .
+Added: During the years ended December 31, 2023 and 2022, the Company recorded interest expense relating to the Loan Agreement of $ 2.5 million and $ 1.6 million , respectively.
The weighted average effective interest rate as of December 31, 2023 was 11.19 %.
7 unchanged sentences
Net carrying amount
−Removed: The carrying amount of the Company's term loan approximates fair value.
+Added: Less current portion
+Added: Long-term portion
+Added: The carrying value of the Company's term loan approximates fair value.
Other Long-Term Debt
Periphagen Note
−Removed: On December 9, 2019, the Company entered into a series of asset purchase agreements with Periphagen, Inc., a biopharmaceutical company focused on the development of gene therapy vectors.
+Added: On December 9, 2019, the Company entered into a series of asset purchase agreements with Periphagen, Inc.
+Added: (Periphagen), a biopharmaceutical company focused on the development of gene therapy vectors.
Under the terms of the asset purchase agreements, the Company assumed a $ 1.0 million promissory note bearing a contractual interest rate of 2 % compounded annually, with the outstanding balance and accrued interest due upon maturity in November 2027 , with no interim installments due.
−Removed: The estimated market rate for the Company for an unsecured loan with a maturity in November 2027 was determined to be 15.83 %.
−Removed: Although the Company does not have a public credit rating, management estimates a CCC credit rating based on the Company’s financial position and stage of development.
+Added: The estimated market rate for the Company for an unsecured loan with a maturity in November 2027 was determined to be 15.83 % as of December 9, 2019.
+Added: Although the Company does not have a public credit rating, management estimates a CCC credit rating based on the Company’s financial position and stage of development.
Using the commensurate rate for a CCC rated company and based on the amount due at maturity, the present value of the future cash outflow was determined to be $ 0.4 million at the transaction date.
As of December 31, 2023, the carrying value of the note is $ 0.8 million .
−Removed: On February 4, 2019, the Company signed a lease agreement for its new corporate headquarters at 117 Kendrick Street in Needham, Massachusetts.
+Added: The carrying value of the note approximates fair value.
+Added: Upon maturity, the Company will pay Periphagen $ 1.4 million for the outstanding balance and accrued interest due.
+Added: On February 4, 2019, the Company signed a lease agreement for its corporate headquarters at 117 Kendrick Street in Needham, Massachusetts.
The facility consists of a 15,197 square foot property which houses the corporate, clinical, laboratory and manufacturing operations for the Company.
The lease term ends on August 31, 2026 .
−Removed: Prior to occupying the new space, the Company had construction performed to modify the space to meet its needs.
−Removed: The Company received $ 0.8 million as a reimbursement by our landlord for a tenant improvement.
−Removed: The $ 0.8 million lease incentive was recorded as reduction to the lease right of use asset recorded to the Company's consolidated balance sheet upon adoption of ASC 842 on January 1, 2022.
−Removed: Disclosures under ASC 842
−Removed: For the year ended December 31, 2022, the Company has recorded $ 0.4 million of operating lease cost and $ 0.1 million of variable lease cost.
−Removed: The total lease expense for the year ended December 31, 2022 was $ 0.5 million .
−Removed: Cash paid for amounts included in the lease liability for the year ended December 31, 2022 was $ 0.6 million .
+Added: For each of the years ended December 31, 2023 and 2022, the Company recorded $ 0.4 million of operating lease cost and $ 0.1 million of variable lease cost.
+Added: The total lease expense for each of the years ended December 31, 2023 and 2022 was $ 0.5 million .
+Added: Cash paid for amounts included in the lease liability for each of the years ended December 31, 2023 and 2022 was $ 0.6 million .
+Added: YEAR ENDED DECEMBER 31,
Other Information
6 unchanged sentences
Total lease liability
−Removed: Disclosures under ASC 842
−Removed: For the year ended December 31, 2021, the Company recorded rent expense of $ 0.5 million.
−Removed: The following table summarizes the future minimum lease payments due under the Company's facility lease as of December 31, 2021, presented in accordance with ASC 840, the relevant accounting standard at that time (in thousands):
−Removed: Total minimum lease payments
Common Stock and Preferred Stock
9 unchanged sentences
Shares available for future grant under stock option plan
−Removed: Reverse Stock Split
−Removed: In connection with the Company's IPO, on July 14, 2021, the Company’s board of directors and stockholders approved a one-for-2.4579 reverse stock split of the Company’s issued and outstanding common stock and a proportional adjustment to the existing conversion ratios for the outstanding shares of convertible preferred stock which became effective on July 15, 2021.
−Removed: Accordingly, all share and per share amounts for all periods presented in the accompanying consolidated financial statements and notes thereto have been retroactively adjusted, where applicable, to reflect the reverse stock split.
−Removed: Initial Public Offering
−Removed: The Company completed its IPO on July 29, 2021 and issued 9,000,000 shares of its common stock at a price to the public of $ 8.00 per share.
−Removed: On August 13, 2021, the Company issued an additional 887,994 shares of its common stock
−Removed: at $ 8.00 per share pursuant to a partial exercise of the underwriters' purchase option.
−Removed: Total net proceeds to the Company from the issuance of the 9,877,994 shares of common stock were $ 71.3 million , after deducting underwriting discounts and commissions and offering expenses.
−Removed: Upon closing of the IPO, all outstanding shares of the Company’s Preferred Stock automatically converted into 7,066,398 shares of common stock.
Shelf Registration and At-the-Market Offerings
−Removed: On August 5, 2022, the Company filed a shelf registration statement on Form S-3 (the Shelf) with the SEC, which covers the offering, issuance, and sale by us of up to an aggregate of $ 200.0 million of our common stock, preferred stock, debt securities, warrants and/or units of any combination thereof.
−Removed: We simultaneously entered into a sales agreement with Jefferies LLC, as sales agent, to provide for the issuance and sale by us of up to $ 75.0 million of our common stock from time to time in “at-the-market”
−Removed: offerings under the Shelf (the ATM Program).
+Added: On August 5, 2022, the Company filed the Shelf with the SEC, which covers the offering, issuance, and sale by us of up to an aggregate of $ 200.0 million of our common stock, preferred stock, debt securities, warrants and/or units of any combination thereof.
+Added: We simultaneously entered into a sales agreement with Jefferies LLC, as sales agent, to provide for the issuance and sale by us of up to $ 75.0 million of our common stock from time to time in “at-the-market” offerings under the Shelf.
The Shelf was declared effective by the SEC on August 12, 202 2.
−Removed: As of the date hereof, no sales have been made pursuant to the ATM Program.
+Added: Due to the SEC’s “baby shelf rules,” which prohibit companies with a public float of less than $ 75.0 million from issuing securities under a shelf registration statement in excess of one third of such company’s public float in a 12-month period, the Company is currently only able to issue a limited number of shares which aggregate to no more than one-third of its public float using the Shelf.
+Added: As of December 31, 2023, no sales had been made pursuant to the ATM Program.
+Added: Subsequent to December 31, 2023 and through March 21, 2024, we have sold and issued 109,485 shares of common stock under the ATM Program, with total net proceeds of $ 0.2 million .
The Company has the following warrants outstanding for the purchase of common stock as of December 31, 2023 and 2022:
6 unchanged sentences
NC Ohio Trust
−Removed: Series A Warrants
−Removed: Series A Warrants were issued in connection with the Series A Preferred Stock in 2016.
−Removed: In 2018, upon the conversion of the Series A Preferred Stock into common stock, the Series A Warrants became exercisable for common stock at an exercise price of $ 5.67 per share.
−Removed: Subsequent to the IPO, 75,946 Series A Warrants were exercised and the remaining 48,850 Series A Warrants expired in August 2021 .
Series B Warrants
6 unchanged sentences
• an additional 918,121 shares vest upon (1) a financing event with a per share price of $ 14.68 , or (2) an average market price (determined over a consecutive 10 -day period) of, $ 14.68 per share.
−Removed: On June 24, 2021, the Company’s board of directors approved and on July 14, 2021 the stockholders approved, effective upon the closing of the IPO, an amendment to the terms of the Series B Warrants and the Conditional Series B Warrants to extend the expiration date from November 2023 to November 2025 .
−Removed: In addition, the exercise period for the Conditional Series B Warrants was amended such that in the event the future financing milestones or certain share price targets described above are achieved, the Conditional Series B Warrants can only be exercised in conjunction
−Removed: with the sale of the Company, on a cash or cashless exercise basis, or otherwise in November 2025 through a cashless exercise.
−Removed: The Company recorded the Series B Warrants as a component of stockholder’s equity at the time of issuance at their estimated fair value of $ 2.1 million and recorded the Conditional Series B Warrants as a liability on the consolidated balance sheet as the number of shares used to calculate the settlement is not a fixed number of shares.
+Added: On June 24, 2021, the Company’s board of directors approved and on July 14, 2021 the stockholders approved, effective upon the closing of the IPO, an amendment to the terms of the Series B Warrants and the Conditional Series B Warrants to extend the expiration date from November 2023 to November 2025 .
+Added: In addition, the exercise period for the Conditional Series B Warrants was amended such that in the event the future financing milestones or certain share price targets described above are achieved, the Conditional Series B Warrants can only be exercised in conjunction with the sale of the Company, on a cash or cashless exercise basis, or otherwise in November 2025 through a cashless exercise.
+Added: The Company recorded the Series B Warrants as a component of stockholder’s equity at the time of issuance at their estimated fair value of $ 2.1 million and recorded the Conditional Series B Warrants as a liability on the consolidated balance sheet as the number of shares used to calculate the settlement is not a fixed number of shares.
The Conditional Series B Warrants are remeasured to their fair value at each reporting date with changes in the fair value recognized as a component of other income (expense), net in the consolidated statements of operations.
4 unchanged sentences
The beneficiary in the trust agreement has provided past services to the Company for more than 15 years and is a non-employee.
−Removed: The warrant provides the beneficiary the right to purchase 162,740 shares of the Company’s common stock, $ 0.01 par value at an exercise price of $ 1.46 per share, subject to adjustments as specified in the warrant agreement.
+Added: The warrant provides the beneficiary the right to purchase 162,740 shares of the Company’s common stock, $ 0.01 par value at an exercise price of $ 1.46 per share, subject to adjustments as specified in the warrant agreement.
The Company recognizes the warrants as compensation expense within the consolidated statement of operations when the warrants are granted or at the service inception date if the service inception date precedes the grant date.
2 unchanged sentences
The Company remeasures the fair value of the award at each reporting date, as the service date preceded the grant date.
−Removed: The value of the warrants for 162,740 shares of common stock was $ 0.2 million and $ 1.1 million as of December 31, 2022 and 2021 , respectively, and changes in the fair values were recorded as stock compensation expense within research and development expense and a credit to stockholders’
−Removed: equity in the consolidated financial statements.
+Added: The value of the warrants for 162,740 shares of common stock was $ 0.2 million as of both December 31, 2023 and 2022 , and was recorded as stock compensation expense within research and development expense and a credit to stockholders’ equity in the consolidated financial statements.
Stock Options, Restricted Stock and Stock-Based Compensation
Equity Incentive Plans
−Removed: The Company’s 2015 Stock Plan, as amended, (the 2015 Plan) provides for the Company to sell or issue common shares or restricted common stock, or to grant incentive stock options or nonqualified stock options for the purchase of common stock, to employees, members of the board of directors and consultants of the Company.
−Removed: The 2015 Plan is administered by the board of directors and exercise prices, vesting and other restrictions are determined at its discretion.
+Added: The Company’s 2015 Stock Plan, as amended, (the 2015 Plan) provides for the Company to sell or issue common shares or restricted common stock, or to grant incentive stock options or nonqualified stock options for the purchase of common stock, to employees, members of the board of directors and consultants of the Company.
+Added: The 2015 Plan is administered by the board of directors and exercise prices, vesting and other restrictions are determined at its
All stock option grants are non-statutory stock options except option grants to employees intended to qualify as incentive stock options under the Internal Revenue Code of 1986, as amended.
−Removed: Incentive stock options may not be granted at less than the fair market value of the Company’s common stock on the date of grant, as determined in good faith by the board of directors at its sole discretion.
+Added: Incentive stock options may not be granted at less than the fair market value of the Company’s common stock on the date of grant, as determined in good faith by the board of directors at its sole discretion.
Nonqualified stock options may be granted at an exercise price established by the board of directors at its sole discretion and the vesting periods may vary.
3 unchanged sentences
As of December 31, 2023 , there are no shares available for grants under the 2015 Plan and the 2015 Plan continues to govern the terms and conditions of the outstanding awards under the 2015 Plan.
−Removed: On July 14, 2021, the Company’s 2021 Equity Incentive Plan (the 2021 Plan) was approved by the Company’s stockholders, and became effective upon completion of the IPO and serves as the successor to the 2015 Plan.
+Added: On July 14, 2021, the Company’s 2021 Equity Incentive Plan (the 2021 Plan) was approved by the Company’s stockholders, and became effective upon completion of the IPO and serves as the successor to the 2015 Plan.
5,321,447 shares of common stock are reserved under the 2021 Plan, of which 252,053 shares remain available for future grants as of December 31, 2023.
2 unchanged sentences
TERM (IN YEARS)
+Added: (IN THOUSANDS)
Outstanding as of December 31, 2022
−Removed: Cancelled or forfeited
+Added: Cancelled, forfeited or expired
Outstanding as of December 31, 2023
4 unchanged sentences
The shares tendered are recorded as treasury stock within the Company's consolidated financial statements at December 31, 2023.
−Removed: The fair value of stock options granted was estimated on the grant date using the Black-Scholes option pricing model based on the following weighted-average assumptions:
+Added: The fair value of stock options granted was estimated on the grant date using the Black-Scholes option pricing model based on the following assumptions:
YEAR ENDED DECEMBER 31,
7 unchanged sentences
Expected dividend yield
−Removed: Exercise price
−Removed: $ 1.75 - $ 5.19
−Removed: $ 4.97 - $ 11.23
−Removed: Fair value of common stock
−Removed: $ 1.75 - $ 5.19
−Removed: $ 4.97 - $ 11.23
−Removed: The total intrinsic value of stock options vested during the years ended December 31, 2022 and 2021 was zero and $ 6.6 million, respectively.
−Removed: Restricted Stock
−Removed: Under the terms of the restricted stock unit agreements covering the common stock, shares of common stock related to restricted stock units are subject to time-based and performance-based vesting.
+Added: The total intrinsic value of stock options vested during each of the years ended December 31, 2023 and 2022 was zero .
+Added: Restricted Stock Units
+Added: Under the terms of the restricted stock unit agreements covering the common stock, shares of common stock related to restricted stock units are subject to time-based vesting.
The restricted stock units will immediately be forfeited to the Company if the relationship between the recipient and the Company ceases.
4 unchanged sentences
Unvested at December 31, 2023
−Removed: The aggregate fair value of restricted stock units that vested during each of the years ended December 31, 2022 and 2021 was zero .
+Added: The aggregate fair value of restricted stock units that vested during each of the years ended December 31, 2023 and 2022 was $ 0.5 million and zero , respectively .
Stock-Based Compensation
7 unchanged sentences
Due to the Company's net losses for 2023 and 2022 , as well as the full valuation allowance on its net deferred tax assets as discussed below, the Company did no t record any income tax expense or benefit for the years ended December 31, 2023 and 2022 .
−Removed: A reconciliation of income tax expense at the federal statutory income tax rate to the income tax expense at the Company’s effective income tax rate is as follows:
+Added: A reconciliation of the Company's statutory income tax rate to the Company’s effective income tax rate is as follows:
Income at US statutory rate
3 unchanged sentences
Valuation allowance
+Added: On October 4, 2023, the Governor of Massachusetts signed into law a bill that included the adoption of a single sales apportionment factor effective on January 1, 2025.
+Added: As required under ASC 740, the Company has accounted for the deferred tax impacts of this tax law change in the period the tax law was enacted, which has the impact of reducing its state deferred tax assets.
+Added: The impact of the tax law change is offset by a change in valuation allowance.
Net deferred tax assets as of December 31, 2023 and 2022 consist of the following (in thousands):
8 unchanged sentences
Valuation allowance
−Removed: Deferred tax assets
+Added: Net deferred tax assets
Deferred tax liabilities:
6 unchanged sentences
Management of the Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets, which are comprised principally of net operating loss carryforwards and certain tax credits.
−Removed: Management has considered the Company’s history of cumulative net losses incurred since inception, as well as its lack of product revenue since inception, and has determined that it is more likely than not that the Company will not realize the benefits of its deferred tax assets.
+Added: Management has considered the Company’s history of cumulative net losses incurred since inception, as well as its lack of product revenue since inception, and has determined that it is more likely than not that the Company will not realize the benefits of its deferred tax assets.
As a result, a full valuation allowance has been established at December 31, 2023 and 2022.
−Removed: Section 382 of the Internal Revenue Code of 1986, as amended (“Section 382”), contains rules that limit the ability of a company that undergoes in ownership change to utilize its net operating losses (“NOLs”) and tax credits existing as of the date of such ownership change.
−Removed: Under the rules, such an ownership change is generally any change in ownership of more than 50% of a company’s stock within a rolling three-year period.
+Added: Section 382 of the Internal Revenue Code of 1986, as amended (Section 382), contains rules that limit the ability of a company that undergoes in ownership change to utilize its net operating losses (NOLs) and tax credits existing as of the date of such ownership change.
+Added: Under the rules, such an ownership change is generally any change in ownership of more than 50% of a company’s stock within a rolling three-year period.
The rules generally operate by focusing on changes in ownership of all stock considered by the rules as owning, directly or indirectly, 5% or more of the stock of a company and any change in ownership arising from new issuances of stock by the company.
1 unchanged sentence
The Company will make such a determination prior to the utilization of any future net operating losses.
−Removed: A summary of changes in the valuation allowance for deferred tax assets during the year ended December 31, 2022 and 2021 were as follows (in thousands):
+Added: A summary of changes in the valuation allowance for deferred tax assets during the years ended December 31, 2023 and 2022 were as follows (in thousands):
Valuation allowance
9 unchanged sentences
Ventagen paid the Company $ 1.0 million upon the signing of the agreement and agreed to a fixed future payment to the Company of $ 2.5 million.
−Removed: The future payment will be made upon the achievement of $ 5.0 million of sales of an approved product by Ventagen and is subject to reduction if Ventagen’s costs to develop an approved product exceeds $ 4.0 million.
+Added: The future payment will be made upon the achievement of $ 5.0 million of sales of an approved product by Ventagen and is subject to reduction if Ventagen’s costs to develop an approved product exceeds $ 4.0 million.
In addition to the upfront payment and the future payment, Ventagen agreed to purchase from the Company all manufactured product that is required for clinical or commercial purposes at a price of cost plus 25 % of the wholesale price of the approved product, subject to a minimum or maximum price.
In the event the Company is unable or unwilling to manufacture supply under the terms of the agreement, Ventagen has the right to manufacture its own supply and will be required to pay a fixed fee per dose sold.
−Removed: The Company also agreed to provide certain services to Ventagen related to Ventagen’s development plan.
−Removed: Stockholders of the Company own 49.5 % of the voting stock of Ventagen, including 47 % by the Company’s founders who are currently significant stockholders of the Company, and trusts for the benefit of their children.
−Removed: The Company is recognizing the $ 1.0 million upfront license fee as research and development service revenue, related party, as the Company’s license agreement with Ventagen is within the scope of ASC 606.
−Removed: The license agreement met the contract existence criteria and contained distinct, identifiable performance obligations for which the stand-alone selling prices were readily determinable and allocable.
−Removed: The terms of the agreement contained multiple, distinct performance obligations, including transfer of a license for the Territory, research and development oversight for the trials run by Ventagen, and clinical data sharing.
−Removed: The Company estimated the transaction prices, including any variable consideration, at contract inception and determined the fair value of such obligations.
−Removed: The performance obligation associated with the license transfer was satisfied at a point in time, or at contract inception;
−Removed: however, the Company assigned no value to the license transfer.
−Removed: The remaining $ 1.0 million transaction price was allocated between the research and development oversight and clinical data sharing.
−Removed: The Company is recognizing revenue for these obligations over an 8-year period, beginning in 2015, by measuring the progress towards satisfaction of the performance obligations.
−Removed: As clinical oversight and clinical
−Removed: data sharing occurs over the 8 —year clinical trial period, the revenue is recognized over the same period in which the cost for these services is incurred.
−Removed: The Company defers recognition of the portion of the $ 1.0 million non-refundable upfront license fee for the portion of the performance obligations that are not satisfied.
−Removed: The Company recognized revenue of $ 0.1 million in the years ended December 31, 2022 and 2021 .
−Removed: The license agreement includes a $ 2.5 million potential future milestone payment due to the Company upon successful completion of certain separate, distinct events.
−Removed: At this time, the Company cannot estimate when the milestone-related performance obligations are expected to be achieved and will recognize revenue once satisfaction is probable.
−Removed: There was no additional variable consideration, significant financing components, non-cash consideration, or consideration payable to the customer in this agreement.
+Added: The Company also agreed to provide certain services to Ventagen related to Ventagen’s development plan.
+Added: Stockholders of the Company own 49.5 % of the voting stock of Ventagen, including 47 % by the Company’s founders who are currently significant stockholders of the Company, and trusts for the benefit of their children.
+Added: The Company had completely recognized the $ 1.0 million upfront license fee as research and development service revenue as of December 31, 2022.
Technology License Agreement
2 unchanged sentences
Pursuant to the Option Agreement, the Company will support a clinical trial to be conducted at MGB pursuant to the terms of a clinical trial agreement to be negotiated and the Company has committed to remitting $ 0.8 million in support of such clinical trial over the course of approximately three years .
−Removed: Upon execution of the Option Agreement, the Company remitted a non-refundable fee of $ 40,000 to MGB to be applied toward the Company’s on-going obligations to reimburse patent expenses.
−Removed: In the years ended December 31, 2022 and 2021 , respectively, the Company expensed zero and $ 28,000 , respectively, for startup and patient fees for clinical trials performed by MGB.
+Added: Upon execution of the Option Agreement, the Company remitted a non-refundable fee of $ 40,000 to MGB to be applied toward the Company’s on-going obligations to reimburse patent expenses.
+Added: During the years ended December 31, 2023 and 2022 , the Company did no t expense any startup and patient fees for clinical trials performed by MGB.
On September 15, 2020, the Company exercised the Option Agreement with MGB and entered into an exclusive worldwide patent license agreement with MGB (the MGB License).
7 unchanged sentences
The Company has identified the guarantees described below as disclosable, in accordance with ASC 460, Guarantees.
−Removed: As permitted under Delaware law, the Company indemnifies its officers and directors for certain events or occurrences while the officer or director is, or was, serving at the Company’s request in such capacity.
+Added: As permitted under Delaware law, the Company indemnifies its officers and directors for certain events or occurrences while the officer or director is, or was, serving at the Company’s request in such capacity.
The maximum potential amount of future payments the Company could be required to make is unlimited;
−Removed: however, the Company has directors’
−Removed: and officers’
−Removed: insurance coverage that should limit its exposure and enable it to recover a portion of any future amounts paid.
+Added: however, the Company has directors’ and officers’ insurance coverage that should limit its exposure and enable it to recover a portion of any future amounts paid.
The Company is a party to a number of agreements entered into in the ordinary course of business that contain typical provisions that obligate the Company to indemnify the other parties to such agreements upon the occurrence of certain events.
2 unchanged sentences
The Company leases office space under a noncancelable operating lease expiring in 2026 .
−Removed: The Company has standard indemnification arrangements under this lease that require it to indemnify the landlord against all costs, expenses, fines, suits, claims, demands, liabilities, and actions directly resulting from any breach, violation, or nonperformance of any covenant or condition of the lease.
+Added: The Company has standard indemnification arrangements under this lease that require it to indemnify the landlord against all costs, expenses, fines,
+Added: suits, claims, demands, liabilities, and actions directly resulting from any breach, violation, or nonperformance of any covenant or condition of the lease.
As of December 31, 2023 , the Company had no t experienced any losses related to these indemnification obligations, and no material claims with respect thereto were outstanding.
2 unchanged sentences
From time to time, we may become involved in litigation or other legal proceedings.
−Removed: On December 15, 2022, Periphagen notified us by letter of its claim that we have failed to use commercially reasonable efforts to complete a human proof of concept clinical trial of an NT-3 Asset under an Exclusive License Agreement dated December 9, 2019 between us and Periphagen (the “Periphagen License Agreement”).
−Removed: We have denied Periphagen’s claims.
−Removed: On January 13, 2023, we filed a demand for arbitration against Periphagen with the American Arbitration Association, seeking a declaration that Periphagen’s December 15 letter failed to comply with the dispute and escalation provisions in the Periphagen License Agreement.
−Removed: After filing the demand, the parties began engaging in the dispute and escalation process under the Periphagen License Agreement.
+Added: On December 15, 2022, Periphagen notified us by letter of its claim that we have failed to use commercially reasonable efforts to complete a human proof of concept clinical trial of an NT-3 Asset under an Exclusive License Agreement dated December 9, 2019 between us and Periphagen (the Periphagen License Agreement).
+Added: On January 13, 2023, we filed a demand for arbitration against Periphagen with the American Arbitration Association, seeking a declaration that Periphagen’s December 15 letter failed to comply with the dispute and escalation provisions in the Periphagen License Agreement.
On March 10, 2023, Periphagen filed its answer and counterclaims to our demand for arbitration.
−Removed: In its counterclaims, Periphagen seeks a declaration that we have not used commercially reasonable efforts to complete a human proof of concept clinical trial of the NT-3 Asset and a declaration that any further extension of time would not be scientifically or commercially reasonable.
−Removed: Periphagen also seeks a declaration that Candel must use commercially reasonable efforts to develop the NT-3 Asset during any remaining time under the agreement.
−Removed: We have denied Periphagen’s counterclaims.
−Removed: In the event the parties are unable to resolve the dispute as part of the escalation process, an arbitrator will decide whether we have used commercially reasonable efforts.
−Removed: In the event that the arbitrator determines that we have not used commercially reasonable efforts, then we may submit a specified payment in lieu of satisfying such obligations.
+Added: In its counterclaims, Periphagen sought a declaration that we have not used commercially reasonable efforts to complete a human proof of concept clinical trial of the NT-3 Asset and a declaration that any further extension of time would not be scientifically or commercially reasonable.
+Added: We denied Periphagen’s counterclaims.
+Added: On June 7, 2023, the parties entered into an amendment to the Exclusive License Agreement that resolved the dispute and resulted in termination of the arbitration without any financial impact.
Aside from the proceeding with Periphagen, we are not currently a party to any litigation or legal proceedings that, in the opinion of our management, are probable to have a material adverse effect on our business.
6 unchanged sentences
Net loss per share -basic and diluted
−Removed: The Company’s potentially dilutive securities have been excluded from the computation of dilutive net loss per share as the effect would be to reduce the net loss per share.
+Added: The Company’s potentially dilutive securities have been excluded from the computation of dilutive net loss per share as the effect would be to reduce the net loss per share.
Therefore, the weighted-average number of shares of common stock outstanding used to calculate both basic and diluted net loss per share is the same.
4 unchanged sentences
Unvested restricted stock
−Removed: Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized .
+Added: Corporate Restructuring
+Added: In November 2023, the Company's Board of Directors authorized a restructuring plan to focus on continuation and expansion of development of CAN-3110 as well as the enLIGHTEN TM Discovery Platform, which resulted in a reduction of the Company’s workforce by approximately 45 % .
+Added: Each affected employee's separation from the Company occurred in December 2023.
+Added: As a result, the Company incurred costs of $ 0.7 million related to severance benefits for the affected employees, including severance payments and limited reimbursement of medical insurance premiums.
+Added: The restructuring plan is expected to be completed in the first quarter of 2024 once the remaining unpaid severance payments of $ 46,000 are made.
+Added: Of the $ 0.7 million in costs recognized related to the restructuring plan, $ 0.5 million and $ 0.2 million have been charged to research and development and general and administrative expenses, respectively, in the accompanying consolidated statement of operations for the year ended December 31, 2023.
+Added: During the year ended December 31, 2023, the Company paid $ 0.7 million in severance benefits to separating employees related to the restructuring plan.
+Added: At December 31, 2023, unpaid severance costs of $ 46,000 are included in accrued expenses in the accompanying consolidated balance sheet and are expected to be paid during the first quarter of 2024.
+Added: Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized .
Candel Therapeutics, Inc.
3 unchanged sentences
President and Chief Executive Officer
−Removed: Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated.
+Added: POWER OF ATTORNEY
+Added: Each person whose individual signature appears below hereby constitutes and appoints Paul Peter Tak and Charles Schoch, and each of them, with full power of substitution and resubstitution and full power to act without the other, as his or her true and lawful attorney-in-fact and agent to act in his or her name, place and stead and to execute in the name and on behalf of each person, individually and in each capacity stated below, and to file any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing, ratifying and confirming all that said attorneys-in-fact and agents or any of them or their or his substitute or substitutes may lawfully do or cause to be done by virtue thereof.
+Added: Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated.
/s/ Paul Peter Tak
3 unchanged sentences
Paul Peter Tak, M.D., Ph.D.
−Removed: Chief Financial Officer (Principal Financial and Accounting Officer)
+Added: /s/ Charles Schoch
+Added: Interim Chief Financial Officer (Principal Financial and Accounting Officer)
March 28, 2024
−Removed: /s/ Paul B Manning
+Added: Charles Schoch
March 28, 2024
−Removed: Paul B Manning
/s/ Edward J.
17 unchanged sentences
Diem Nguyen, Ph.D., MBA
+Added: /s/ Nicoletta Loggia
+Added: March 28, 2024
+Added: Nicoletta Loggia, Ph.D., R.Ph
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.