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Item 9A. Controls and Procedures

2025-03-26 compared with 2024-03-11 · 725 added, 5 removed, 195 unchanged (79% of the section changed)

20 unchanged sentences

OTHER INFORMATION

Rule 10b5-1 Trading Arrangements

During the three months ended December 31, 2024, none of the directors or executive officers of the Company adopted or terminated any contracts, instructions, or written plans for the purchase or sale of the Company’s securities that were intended to meet the affirmative defense conditions of Rule 10b5-1(c) or any other “ non-Rule 10b5-1 trading arrangement.”

Amendment to Employment Agreements

On March 24, 2025, the Company amended the employment agreements of our named executive officers Linda Marbán, Anthony Bergmann and Karen Krasney to increase the severance period upon termination of employment without cause or resignation for good reason to twelve months from six months.

DISCLOSURE RE GARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE .

The information required by this item will be set forth in the sections entitled “Information Regarding the Board of Directors and Corporate Governance,” “Information Regarding Executive Officers” and “Delinquent Section 16(a) Reports” in our Definitive Proxy Statement for our 2024 Annual Meeting of Stockholders (our “2024 Proxy Statement”), to be filed with the SEC within 120 days after the end of the fiscal year ended December 31, 2023, and is incorporated herein by reference.

INFORMATION REGARDING THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

The following table sets forth each member of our Board:

Director of Company Since

Linda Marbán, Ph.D.

President, Chief Executive Officer and Director

Frank Litvack, M.D.

Executive Chairman and Director

(Duke) Collier Jr., J.D.

Dunbar Jr., M.B.A.

Karimah Es Sabar

Paul Auwaerter, M.D., M.B.A.

Philip Gotwals, Ph.D.

Michael Kelliher

*Age as of February 28, 2025

Linda Marbán, Ph.D.

Marbán is our Chief Executive Officer, and has served in that capacity and on the Board since November 2013.

Marbán is a co-founder of Capricor, Inc.

(wholly-owned subsidiary of Capricor Therapeutics, Inc.) and has been with the Company since 2005 and became its Chief Executive Officer in 2010.

Marbán has been in the biotechnology field for more than 20 years and brings extensive experience across research, product development and business development to the Company.

From 2003-2009, Dr.

Marbán held various senior roles at Excigen, Inc., a gene therapy biotechnology company, where she was responsible for operations and business development and where she oversaw the development of a biologic pacemaker for the heart.

Prior to Excigen, Dr.

Marbán worked in academic science, first at the Cleveland Clinic Foundation working on the development of contractile dysfunction in heart failure due to myocarditis, followed by a postdoctoral fellowship at Johns Hopkins University.

While at Johns Hopkins, she advanced to the rank of Research Assistant Professor in the Department of Pediatrics, specializing in the mechanism of the biophysical properties of cardiac muscle.

Her tenure at Johns Hopkins ran from 2000 to 2003.

Marbán earned a Ph.D.

from Case Western Reserve University in cardiac physiology and her Bachelor of Science from the University of Maryland.

Linda Marbán was selected to serve as a member of the Board in part due to her wealth of knowledge in research and development, especially for the treatment of cardiovascular diseases, her experience in early-stage life sciences companies spanning over a decade, as well as her business development expertise.

Frank Litvack, M.D., FACC.

Litvack joined the Capricor, Inc.

Board in 2012 and since November 2013 has been serving as the Company’s Executive Chairman.

Litvack is a native of Canada.

He completed medical school and residency at McGill University in Montreal and a Cardiovascular Fellowship at Cedars-Sinai Medical Center in Los Angeles, where he subsequently became co-director of the Cardiovascular Intervention Center and Professor of Medicine at UCLA.

There he led a prominent clinical and research program known for its excellence in innovation, care, and leadership in Translational Medicine.

Litvack was board-certified in Internal Medicine, Cardiovascular Diseases, and Interventional Cardiology.

He has published more than one hundred research articles and chapters and is the recipient of several awards, including an American Heart Association Young Investigator Award, the Leon Goldman Medical Excellence Award for contributions to the field of biomedical optics, and the United States Space Technology and Space Foundation Hall of Fame for pioneering work with the excimer laser.

Litvack left full-time practice and academics in 2000 to concentrate on entrepreneurial activities.

Litvack has founded and operated several healthcare ventures, both as chairman and/or chief executive officer, including Progressive Angioplasty Systems Inc., a medical device company that was acquired by United States Surgical Corp.

Savacor, Inc., a medical device company that was acquired by St.

Jude Medical in 2005;

Conor Medsystems, Inc., a publicly-traded medical device company that was acquired by Johnson & Johnson in 2007 and V-Wave Ltd.

(sold to Johnson & Johnson in 2024).

He presently sits on the boards of Credence MedSystems, a drug delivery company and Levation Pharma, a specialty pharmaceutical company in the area of facial aesthetics which he co-founded.

Litvack was formerly a Member of the Management Company of Pura Vida Investments, LLC, a healthcare hedge fund that he exited in 2023.

Since 2023, he is the Managing Member of Wilhareka

Partners LLC.

He is serving as a director on the board of Cardiovascular Research Foundation, a non-profit research and education entity and on the Advisory Board of the Tannenbaum Open Science Institute at McGill University.

Frank Litvack, our Executive Chairman, was selected to serve as a member of the Board in part due to his wealth of business-building experience and medical expertise that anchors our activities in sound scientific research and solid business planning and practices.

Additionally, as an accomplished veteran of the healthcare industry who has orchestrated the founding, development, financing and sale of several medical technology companies, we believe that Dr.

Litvack provides invaluable knowledge and leadership to the Company.

(Duke) Collier Jr.

Collier has been a member of the Capricor, Inc.

Board since 2011 and became a member of the Company’s Board in November 2013.

He is a member of the Company’s Compensation Committee and Chairman of the Nominating and Corporate Governance Committee.

From 2010-2014, he served as the Chief Executive Officer of 480 Biomedical, a medical device company developing products used in the treatment of peripheral artery disease, and the executive chairman of Arsenal Medical, Inc., a medical device company.

Collier was formerly Executive Vice President at Genzyme Corporation, a biotechnology company acquired by Sanofi for $20.1 billion in 2011.

Collier also served as President of Vitas Healthcare, a hospice provider, as a partner at the Washington, DC-based law firm of Hogan and Hartson, and as Deputy Administrator of the Health Care Finance Administration (now CMS) in the U.S.

Department of Health & Human Services.

He is Chair Emeritus of the Innovation Advisory Board of Mass General Brigham.

Additionally, he is a member of the board of the Boston Athenaeum.

Previously, Mr.

Collier served as a director of publicly-traded Decode Genetics Inc.

(DGI Resolution, Inc.), a biopharmaceutical company;

GenSight, a gene therapy company in Paris that trades on the French Euronext exchange;

and Tesaro, Inc., a publicly-traded biopharmaceutical company.

Collier earned a Bachelor of Arts degree at Yale University and received a law degree from the University of Virginia Law School.

Collier was selected to serve as a member of the Board in part due to his significant experience with early stage private and public companies and depth of knowledge in building stockholder value, growing a company from inception and navigating significant corporate transactions and the public company process.

Additionally, Mr.

Collier has extensive experience in the pharmaceutical industry, allowing him to contribute significant operational experience.

Musket has been a member of the Capricor, Inc.

Board since 2012 and a member of the Company’s Board since November 2013.

He is Chairman of the Company’s Audit and Compensation Committees.

Musket has vast experience in strategic finance and has been following developments in the pharmaceutical and medical device industries for over 30 years.

Musket began his investment career as an equities research analyst at Goldman Sachs & Co.

following the pharmaceutical industry.

From 1991 through 2016 he served as President of Musket Research Associates, a registered broker/dealer focused exclusively on venture banking transactions for emerging healthcare companies.

From 1996 to 2022 he was a General Partner of ProMed Management, a healthcare-focused investment management company.

He has served on the boards of several private and public companies throughout his career.

From 1999 to 2007, Mr.

Musket served on the board of directors of publicly-traded Conor MedSystems, Inc.

a medical device company sold to Johnson & Johnson in 2007 for $1.4 billion.

Musket holds a Bachelor of Arts degree in Biology and Psychology from Boston College.

Musket was selected to serve as a member of the Board in part due to his venture capital and investment banking backgrounds and expertise in financing and growing early-stage biopharmaceutical companies.

Additionally, Mr.

Musket has significant experience with early stage private and public companies and brings a depth of knowledge in building stockholder value, growing a company from inception and navigating significant corporate transactions and the public company process.

Dunbar has been a member of the Capricor, Inc.

Board since 2012 and a member of the Company’s Board since November 2013.

He is a member of the Company’s Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee.

He has been a Managing Partner of The Dunbar Group, LLC since 2011, and provides advisory services to healthcare and life science investors and companies who recognize they need short-term or interim industry expertise as they grow in order to be capital efficient.

Dunbar has extensive healthcare and life sciences operating experience and has served as a director or chief executive officer with private and public life science companies specializing in diagnostics, specialty pharma, cell therapy and biologics, two as chief executive officer, where he led initial public offerings.

He served as chief executive officer of ISTO Technologies and ISTO Biologics, two private orthobiologics companies acquired by Thompson Street Capital Partners.

Prior to ISTO, Mr.

Dunbar served as a Venture Partner with Arboretum Ventures, a leading healthcare venture capital firm.

is currently a board member of Progenitor Life Sciences, a private next-generation immunotherapy development company, and Akadeum Life Sciences, a private next-generation sample prep/separations tools company with a focus on cell and gene therapy.

Dunbar attended Auburn University where he graduated with a Bachelor of Science degree in Electrical Engineering and later received his M.B.A.

He served on the Harbert College of Business M.B.A.

Advisory Board and is an advisor with Life Science Tennessee and to Vanderbilt University’s Center for Technology Transfer and Commercialization.

Dunbar was selected to serve as a member of the Board in part due to his significant experience with early stage private and public companies and depth of knowledge in building stockholder value, growing a company from inception and navigating significant corporate transactions and the public company process.

Additionally, Mr.

Dunbar has extensive experience in the pharmaceutical industry, allowing him to contribute significant operational experience.

Karimah Es Sabar.

Es Sabar joined the Company’s Board in July 2021 and is a member of the Audit Committee and Nominating and Corporate Governance Committees.

Since 2016 she has been the CEO and General Partner at Quark Venture LP, a venture capital investment firm, leading their global health sciences enterprise.

Prior to Quark Venture, Ms.

Es Sabar was President and CEO at the Centre for Drug Research and Development (CDRD), Canada’s national drug development and commercialization center, responsible for developing and executing on the overall strategic direction.

Es Sabar has held senior management positions with multinational pharmaceutical companies, most notably as Director International Division, and later Global Head Marketing and Business Development at Pasteur Merieux Connaught (Sanofi Pasteur) based in Toronto.

She holds degrees in Neurochemistry from the Institute of Psychiatry, University of London, in Biochemistry and Chemistry from the University of Salford Manchester, and an Executive Certificate in Management and Leadership from the MIT Sloan School of Management.

Es Sabar is also the Chair of the Health Biosciences Economic Strategy Table (Government of Canada) and she serves on the board of directors of several biosciences companies.

She is a Member of the Order of British Columbia, and recipient of Canada’s Most Powerful Women:

Top 100 Award and Canada’s Gold Award for Business Excellence amongst others.

Es Sabar was selected to serve as a member of the Board in part due to her significant experience with early stage private and public companies and brings a depth of knowledge in building stockholder value, growing a company from inception and navigating significant corporate transactions and the public company process.

Additionally, Ms.

Es Sabar has expertise in the innovation ecosystem and has extensive experience in the pharmaceutical industry, allowing her to contribute significant operational experience.

Auwaerter, M.D., M.B.A., FIDSA.

Paul Auwaerter joined the Company’s Board in July 2023.

Since 2013, Dr.

Auwaerter has been the Sherrilyn and Ken Fisher Professor of Medicine at the Johns Hopkins University School of Medicine, serving as the Clinical Director for the Division of Infectious Diseases and Director of the Sherrilyn and Ken Fisher Center for Environmental Infectious Diseases.

Auwaerter has served since 2003 as the Executive Director and Chief Medical Officer of the Johns Hopkins Point of Care-Information Technology (POC-IT) Center, producing the Johns Hopkins ABX (Antibiotic), JH HIV, JH Osler, JH Psychiatry and JH Diabetes Guides.

Auwaerter has also served as Editor-in-Chief of the ABX Guide since 2017.

Auwaerter’s research and clinical interests have led to over 115 publications including improving the diagnosis and care for patients with infectious diseases, specifically Lyme disease, respiratory infections, surgical infections, prosthetic joint infections, Epstein-Barr virus, and fever of unknown origin.

He has served as Chair of the Infectious Diseases Society of America Foundation and has been on the Board of Directors of the American Lyme Disease Foundation since 2018.

He is a Past President of the Infectious Diseases Society of America (IDSA), the largest professional society worldwide related to infectious diseases, serving from 2017 to 2018.

Auwaerter has been a member of the Board of Directors of the Baltimore Area Council of the Boy Scouts of America and has been awarded the National Distinguished Eagle Scout award.

Auwaerter holds undergraduate and medical degrees from Columbia University and subsequent training in medicine and infectious diseases at Johns Hopkins, where he has been employed since 1988;

he also trained in the virology and immunology laboratory of Dr.

Diane Griffin.

Paul Auwaerter was selected to serve as a member of the Board in part due to his extensive medical background, including expertise in infectious diseases.

Gotwals, Ph.D.

Philip Gotwals joined the Company’s Board in July 2023.

Gotwals has experience in drug development, research, corporate strategy and business development with a career spanning nearly 30 years in the biotechnology industry.

Gotwals has been a Partner at RedSky Partners, LLC, which provides advisory services to the biotechnology industry in the areas of corporate strategy and business development since 2023.

Previously, Dr.

Gotwals served as the Global Head, Vice President of Business Development and Licensing at Novartis Institutes for

Biomedical Research (NIBR) from 2019 to 2023, where he oversaw business development efforts for all disease areas and technology platforms.

Prior to that, Dr.

Gotwals was Global Head of Search and Evaluation of NIBR from 2017 to 2019.

Gotwals also served as Executive Director, Immuno-Oncology, at NIBR from 2009 to 2017.

Gotwals’ leadership, NIBR business development and licensing executed over 50 major strategic transactions which included licensing deals, collaborations, acquisitions and new company creations.

These transactions led to significant corporate evolution and growth.

During his 13 years at NIBR, Dr.

Gotwals was instrumental in building the company’s immuno-oncology strategic research area and spearheading the collaboration with the University of Pennsylvania to develop chimeric antigen receptor (CAR) T-cell therapies.

Prior to NIBR, he was Vice President of Program Management at Altus Pharmaceuticals from 2006 to 2009, where he was responsible for all product development project management activities.

Prior to Altus, he was Senior Director of Program and Alliance Management at Biogen, from 1994 to 2006, where he oversaw leadership of internal and allied early product development teams in the autoimmune, neurology and oncology therapeutic areas.

Gotwals has a B.A.

in Biology from Amherst College, holds a Ph.D.

in Genetics from the University of California at Berkeley, completed postdoctoral research at the Massachusetts Institute of Technology, business training at Harvard Business School and has published extensively in the area of integrin biology.

Gotwals was selected to serve as a member of the Board in part due to his significant experience with early stage private and public companies and brings a depth of knowledge in building stockholder value, growing a company from inception and navigating significant corporate transactions and the public company process.

Additionally, Dr.

Gotwals has extensive experience in the pharmaceutical industry, allowing him to contribute significant operational experience.

Michael Kelliher.

Michael Kelliher joined the Company’s Board in September 2023.

Kelliher is an experienced business development and finance professional with expertise in corporate strategy, mergers and acquisitions, strategic partnerships and licensing, with a career spanning more than 20 years with leading biotechnology and global pharmaceutical companies.

He joined Ardelyx (Nasdaq:

ARDX) in 2024, a company focused on discovering, developing and commercializing first-in-class targeted therapies that advance patient care, as Executive Vice President of Corporate Development and Strategy.

There, he has responsibility for strategy, business development, and M&A.

Prior to Ardelyx, Mr.

Kelliher served as Group Vice President, M&A and Business Development, at Horizon Therapeutics (now Amgen), a global biotechnology company focused on researching, developing and commercializing medicines for rare, autoimmune and severe inflammatory diseases.

Kelliher’s 9-year tenure at Horizon, he led an aggressive growth and expansion agenda through acquisitions, development collaborations and other transactions.

He was instrumental in transforming Horizon into a $28.0 billion innovation-driven biotech company.

Prior to his time at Horizon, from 2009 to 2014, Mr.

Kelliher held progressive financial roles at Elan Corporation (now Perrigo Company), a leading global pharmaceutical company where he oversaw strategic partnerships and collaborations and advised its board of directors and senior leadership on investments, business development, product commercialization and asset monetization.

Kelliher began his career in banking, public accounting and corporate finance and holds a Bachelor of Commerce degree from the University College Cork (Ireland).

He is also an Associated Chartered Accountant.

Kelliher was selected to serve as a member of the Board in part due to his significant experience with early stage private and public companies and brings a depth of knowledge in building stockholder value, growing a company from inception and navigating significant corporate transactions and the public company process.

Additionally, Mr.

Kelliher has extensive experience in the pharmaceutical industry, allowing him to contribute significant operational experience.

We believe that in order for our Board to effectively guide us through our continued growth as a development-stage biopharmaceutical company, it should be composed of individuals with sophistication and experience in the many disciplines that impact our business.

In order to best serve our stockholders, we seek to have a Board, as a whole, that is competent in key corporate disciplines, including accounting and financial acumen, business judgement, governance, leadership, risk management, social responsibility and reputational issues, strategy and strategic planning.

Additionally, we desire that the Board have specific knowledge related to our industry, such as expertise in healthcare, medical technology, and manufacturing.

While we do not have a formal policy on diversity, when considering the selection of director nominees, the Nominating and Governance Committee considers individuals with diverse backgrounds, viewpoints, accomplishments, cultural backgrounds and professional expertise, among other factors.

Further, our Board is committed to actively seeking highly qualified women and individuals from underrepresented minority groups to include in the pool from which new candidates are selected.

Of our seven directors, two directors self-identify as female and one director self-identifies as a racial or ethnic minority.

Audit Committee

The current members of our Audit Committee are Mr.

David Musket (Chair), Mr.

George Dunbar and Ms.

Karimah Es Sabar.

The Board has determined that Mr.

Musket qualifies as an “audit committee financial expert,” as defined by the applicable rules of the SEC.

Musket has been determined by the Board satisfy the independence requirements under the pertinent listing standards of the Nasdaq and Rule 10A-3(b)(1) of the Exchange Act.

The Audit Committee of the Board is a separately-designated standing audit committee established by the Board in accordance with Section 3(a)(58)(A) of the Exchange Act.

INFORMATION REGARDING EXECUTIVE OFFICERS

Below is a list of the names, ages, positions, and a description of the business experience of each of our executive officers as of February 28, 2025:

Linda Marbán, Ph.D.

President, Chief Executive Officer and Director

Anthony Bergmann, M.B.A.

Chief Financial Officer

Krasney, J.D.

Executive Vice President and General Counsel

A description of the business experience of Linda Marbán is provided above under the heading “Information Regarding the Board of Directors and Corporate Governance”.

Anthony Bergmann, M.B.A.

Bergmann has served as our Chief Financial Officer since 2018 and has been involved in the biotechnology industry for over a decade.

Bergmann joined Capricor in 2011 and has held various roles of increasing responsibility throughout his tenure.

Prior to joining Capricor., Mr.

Bergmann had experience in accounting, finance and operations management of companies ranging in size from start-ups to mid-size companies.

Prior to Capricor., he was with the business management firm, Gettleson, Witzer and O’Connor headquartered in Beverly Hills, California, where he managed accounting and finance for several production studios generating motion pictures with worldwide revenue exceeding $1.0 billion.

The firm’s clients included actors, musicians, producers, directors and international foundations across the entertainment and music industries.

During his time at Capricor, Mr.

Bergmann oversaw the Company’s reverse merger and uplisting to the Nasdaq Capital Market, completed equity financings yielding over $250 million and oversaw business development leading to multiple strategic partnerships for total deal value exceeding $1.5 billion.

Bergmann earned his Bachelor of Science from Providence College and his M.B.A.

from the University of Southern California’s Marshall School of Business.

He is actively involved in various venture capital and entrepreneurial associations throughout the Southern California area.

Krasney, J.D.

Krasney has served as our Executive Vice President, Secretary and General Counsel since 2012.

Krasney’s career spans over 40 years serving as general counsel for numerous corporations and private companies engaged in a wide variety of industries.

Her extensive background and vast experience has been focused on domestic and international corporate and business law, as well as litigation.

Krasney has been involved in the medical technology arena since the mid-1990s, representing several medical technology companies developing products for the treatment of cardiovascular disease.

Commencing in 2002, Ms.

Krasney served as legal counsel for Biosensors International Group Ltd., a multinational medical device company that developed, manufactured and sold medical devices for cardiology applications.

In 2006, she accepted the position of General Counsel and Executive Vice President of Biosensors and served in that capacity until 2010.

During her tenure at Biosensors Ms.

Krasney, among other things, headed the legal team that facilitated the company’s successful initial public offering in Singapore and was responsible for negotiating and documenting all agreements for the company worldwide, including licensing agreements with major medical device companies and agreements required for the company’s international clinical trials.

During her tenure at Capricor, Ms.

Krasney has been responsible for overseeing all legal matters involving the Company including, business transactions, corporate governance, and intellectual property and has played an integral role in all transactional matters involving the Company.

Krasney also serves as a director on the board of Cardiovascular Research Foundation, a non-profit research and education entity, and as a director for a private non-profit charitable foundation.

Krasney received her Bachelor of Arts degree from the University of California, Los Angeles and her Juris Doctorate from the University of Southern California.

INSIDER TRADING POLICY

The Company has adopted an insider trading policy which governs transactions in our securities by the Company and its directors, officers, employees, consultants, contractors and agents.

We believe this policy is reasonably designed to promote compliance with insider trading laws, rules and regulations, and applicable listing standards.

A copy of our insider trading policy is filed with this Annual Report on Form 10-K as Exhibit 19.1.

CODE OF BUSINESS CONDUCT AND ETHICS

The Board has adopted a Code of Business Conduct and Ethics (the “Code of Ethics”) that applies to all directors, officers, employees, consultants, contractors and agents, wherever they are located and whether they work for us on a full- or part-time basis.

The Code of Ethics was designed to help such directors, employees and other agents to resolve ethical issues encountered in the business environment.

The Code of Ethics covers topics such as conflicts of interest, compliance with laws, confidentiality of Company information, encouraging the reporting of any violations of the Code of Ethics, fair dealing and protection and use of Company assets.

A copy of the Code of Ethics, as adopted by the Board, and revised in April 2021, is available at the Corporate Governance page of our website at www.capricor.com.

We may post amendments to or waivers of the provisions of the Code of Ethics, if any, made with respect to any directors and employees on that website.

Please note that information contained on, or that can be accessed through, our website is not incorporated by reference and is not a part of this Annual Report on Form 10-K.

DELINQUENT SECTION 16(A) REPORTS

EXECUTIVE COMPENSATION.

The information required by this item will be set forth in the section entitled “2023 Executive Compensation” and “Compensation of Directors” in our 2024 Proxy Statement and is incorporated herein by reference.

The following is a discussion and analysis of compensation arrangements of our named executive officers.

As an “smaller reporting company” as defined in the JOBS Act, we are not required to include a Compensation Discussion and Analysis section and have elected to comply with the scaled disclosure requirements.

Our current executive compensation program is intended to align executive compensation with our business objectives and to enable us to attract, retain and reward executive officers who contribute to our long-term success.

The compensation paid or awarded to our executive officers is generally based on the assessment of each individual’s performance compared against the business objectives established for the fiscal year as well as our historical compensation practices.

For 2024, the material elements of our executive compensation program were base salary, annual cash bonuses and equity awards in the form of options.

This section provides a discussion of the compensation paid or awarded to our Chief Executive Officer and our two other most-highly compensated executive officers as of December 31, 2024.

We refer to these individuals as our “named executive officers.” For 2024, our named executive officers were:

● Linda Marbán, Ph.D., Chief Executive Officer and President

● Anthony Bergmann, M.B.A., Chief Financial Officer

● Karen Krasney, J.D., Executive Vice President and General Counsel

Competitive Market Review for 2024

In evaluating compensation decisions with respect to the 2024 base salaries, cash bonus opportunities and equity grants for our named executive officers, our compensation committee considered competitive market data based on the following peer group:

Abeona Therapeutics;

Arcturus Therapeutics;

Dyne Therapeutics;

Edgewise Therapeutics;

Editas Medicine;

Fate Therapeutics;

Lineage Cell Therapeutics;

Sana Biotechnology;

Solid Biosciences;

and Wave Life Sciences.

This peer group (the "2024 Peer Group") was oriented around the following primary criteria:

industry sector;

stage of development;

employee headcount;

and market capitalization.

In assessing the competitiveness of our executive

compensation program for 2024, the compensation committee compared certain aspects of our named executive officers’ compensation, including base salary, target bonus and equity incentives, to the compensation levels provided by our peer group.

Based on the results of the peer group compensation assessment, we determined that compensation levels for our named executive officers in 2024 generally reflected market competitive positioning.

The compensation committee also reviewed data from various life sciences surveys and analyses for compensation metrics used in the industry.

Compensation of Named Executive Officers

Base salaries are intended to provide a level of compensation sufficient to attract and retain an effective management team, when considered in combination with the other components of our executive compensation program.

The relative levels of base salary for our named executive officers are designed to reflect each executive officer’s scope of responsibility and accountability with us.

Marb á n’s annual base salary was $229,300 and Mr.

Bergmann and Ms.

Krasney’s annual base salaries were $376,700, which reflect a 4% cost of living adjustment to each of their base salary levels from the 2023 base salary levels.

Please see the “Salary” column in the 2024 Summary Compensation Table for the base salary amounts earned by each named executive officer in 2024.

Annual Cash Bonuses.

Historically, we have provided our senior leadership team with short-term incentive compensation through our annual cash bonus plan.

Annual bonus compensation holds executives accountable, rewards the executives based on actual business results and helps create a “pay for performance” culture.

The compensation committee considers each named executive officer’s individual contributions towards reaching our annual corporate goals.

There is no minimum bonus percentage or amount established for the named executive officers and, thus, the bonus amounts vary from year to year based on corporate and individual performance.

Our annual cash bonus plan provides cash incentive award opportunities for the achievement of performance goals established by our board of directors at the beginning of each fiscal year, with each named executive officer being assigned corporate and department goals.

Corporate goals were related to regulatory achievements for the deramiocel program as well as the completion of a successful financing.

For 2024, the target bonus for each of our named executive officers was 40% of their base salary.

After considering efforts with respect to regulatory and clinical achievements for our deramiocel program, closing of a successful financing, stock price appreciation and achievement of corporate/departmental goals, the compensation committee awarded bonuses ranging from 30% to 66% of the named executive officer’s base salary.

Equity Compensation.

To further align the interests of our executive officers with the interests of our stockholders and to further focus our executive officers on our long-term performance, we have historically granted equity compensation in the form of stock options.

As part of their annual equity awards, in 2024, Dr.

Marb á n received stock option grants with respect to 250,000 shares, Ms.

Krasney received stock option grants with respect to 80,000 shares, and Mr.

Bergmann received stock option grants with respect to 85,000 shares, each with a per share exercise price equal to the fair market value of an underlying share at the time of grant and vesting in 1/48 th monthly increments commencing February 1, 2024.

2024 Extraordinary Bonuses.

Our board of directors has the discretion to provide bonus awards to named executive officers for extraordinary efforts during the year by providing equity compensation in the form of stock options or restricted stock awards.

Following fiscal year 2024, our board of directors awarded Dr.

Marbán and Mr.

Bergmann one-time bonuses for their efforts during 2024 related to regulatory achievements for the deramiocel program, stock performance as well as the completion of a successful financing among other things.

In January 2025, Dr.

Marb á n received 20,566 stock options with a grant value of $250,000 and Mr.

Bergmann received 6,170 stock options and 3,342 restricted stock awards with an aggregate grant value of $125,000.

All Other Compensation.

Our named executive officers are eligible to participate, on the same basis as our other employees, in our employee benefit plans, including our medical, dental, vision, life and disability plans, and our 401(k) plan.

2024 Summary Compensation Table

The following summary compensation table reflects cash and non-cash compensation for the 2024 and 2023 fiscal years awarded to or earned by our named executive officers.

Name and Principal Position

Awards($) (1)

Compensation ($) (2)

Linda Marbán, Ph.D.

Chief Executive Officer

Karen Krasney, J.D.

Executive Vice President & General Counsel

Anthony Bergmann, M.B.A.

Chief Financial Officer

(1) Amounts reflect the grant date fair value of awards granted under the 2021 Equity Incentive Plan, computed pursuant to Financial Accounting Standards Board’s Accounting Standards Codification 718 “Compensation – Stock Compensation.” Assumptions used in the calculation of these amounts are included in Note 3 – “Stock Awards, Warrants and Options,” of the Notes to Consolidated Financial Statements.

See the “Outstanding Equity Awards at Fiscal Year-End” table below for information regarding all option awards outstanding as of December 31, 2024.

(2) Represents premiums contributed by the Company for the employee’s health reimbursement account and matching contributions contributed by the Company to each NEO’s account in the Company’s 401(k) Plan.

(3) This amount reflects the cash bonus that Dr.

Marbán was awarded with respect to 2024.

Marbán elected to convert $100,000 of her cash bonus into stock options.

Pursuant to this election, she received an option award for 14,396 shares of common stock that were deemed fully vested upon the grant date of January 2, 2025.

(4) This amount has been updated from the amount reported in the 2023 Summary Compensation Table to include the portion of the cash bonus that the NEO elected to receive in fully vested stock options.

For 2023, Dr.

Marbán elected to convert $26,985 of her cash bonus into stock options in lieu of receiving the cash.

Pursuant to this election, she received an option award for 9,633 shares of common stock that were deemed fully vested upon the grant date of January 2, 2024.

(5) This amount has been updated from the amount reported in the 2023 Summary Compensation Table to include the portion of the cash bonus that the NEO elected to receive in fully vested stock options.

For 2023, Ms.

Krasney elected to convert $20,000 of her cash bonus into stock options.

Pursuant to this election, she received an option award for 7,140 shares of common stock that were deemed fully vested upon the grant date of January 2, 2024.

(6) This amount has been updated from the amount reported in the 2023 Summary Compensation Table to include the grant date fair value of the stock option award received by the NEO pursuant the NEO’s election to receive a portion of the cash bonus in equity.

In accordance with SEC disclosure rules, this amount is reflected as Bonus for the period in which it was earned.

(7) This amount has been updated from the amount reported in the 2023 Summary Compensation Table to include the portion of the cash bonus that the NEO elected to receive in fully vested stock options.

For 2023, Mr.

Bergmann elected to convert $27,150 of his cash bonus into stock options in lieu of receiving the cash.

Pursuant to this election, he received an option award for 9,692 shares of common stock that were deemed fully vested upon the grant date of January 2, 2024.

Employment Agreements and Potential Payments Upon Termination or Change in Control

Linda Marbán, Ph.D.

— President and Chief Executive Officer

Linda Marbán’s employment as our Chief Executive Officer is subject to the terms of that certain restated and amended employment agreement dated June 5, 2019, by and between Capricor, Inc.

Effective January 1, 2024, Dr.

Marbán’s annual base salary was set at $229,300.

Marbán received a $150,680 bonus for 2024 services, of which $100,000 was converted into a fully vested option award on January 2, 2025 and $50,680 was paid on February 28, 2025.

Marbán’s employment is at will and she has also signed an employee invention assignment, non-disclosure, non-solicitation and non-competition agreement.

In the event Dr.

Marbán’s employment is terminated by the Company other than for cause, death or disability, or if Dr.

Marbán resigns for good reason, she would be entitled to receive a

severance payment equal to twelve months’ (increased from six months in March 2025) salary then in effect (ignoring any decrease that forms the basis of Dr.

Marbán’s resignation for good reason, if applicable).

Karen Krasney, J.D.

— Executive Vice President, General Counsel

Karen Krasney’s employment as our Executive Vice President and General Counsel is subject to the terms of that certain employment agreement dated May 14, 2019.

Effective January 1, 2024, Ms.

Krasney’s annual base salary was set at $376,700.

Krasney received a $113,010 bonus for 2024 services which was paid on February 28, 2025.

In addition, Ms.

Krasney has signed an at-will employment, confidential information, invention assignment and arbitration agreement.

In the event Ms.

Krasney’s employment is terminated by the Company other than for cause, death or disability, or if Ms.

Krasney resigns for good reason, she would be entitled to receive a severance payment equal to twelve months’ (increased from six months in March 2025) salary then in effect (ignoring any decrease that forms the basis of Ms.

Krasney’s resignation for good reason, if applicable).

Anthony Bergmann, M.B.A.

— Chief Financial Officer

Anthony Bergmann’s employment as our Chief Financial Officer is subject to the terms of that certain employment agreement dated May 14, 2019.

Effective January 1, 2024, Mr.

Bergmann’s annual base salary was set at $376,700.

Bergmann received a $150,680 bonus for 2024 services which was paid on February 28, 2025.

In addition, Mr.

Bergmann has signed an at-will employment, confidential information, invention assignment and arbitration agreement.

In the event Mr.

Bergmann’s employment is terminated by the Company other than for cause, death or disability, or if Mr.

Bergmann resigns for good reason, he would be entitled to receive a severance payment equal to twelve months’ (increased from six months in March 2025) salary then in effect (ignoring any decrease that forms the basis of Mr.

Bergmann’s resignation for good reason, if applicable).

2024 Outstanding Equity Awards at Fiscal Year-End

The following table sets forth information concerning unexercised stock options held by the named executive officers at December 31, 2024.

The options issued under the 2012 Restated Equity Incentive Plan, 2020 Equity Incentive Plan and 2021 Equity Incentive Plan are subject to early exercise.

If the option holder elects to take advantage of the early exercise feature and purchase shares prior to the vesting of such shares, the shares will be deemed restricted stock and will be subject to a repurchase option in favor of the Company if the option holder’s service to the Company terminates prior to vesting.

As of December 31, 2024, none of our named executive officers have early exercised their stock options or held any other outstanding equity awards with respect to the Company.

Equity Incentive

Unexercisable

Expiration Date

Linda Marbán, Ph.D.

Karen Krasney, J.D.

Anthony Bergmann, M.B.A.

(1) Vesting schedule is as follows:

The shares of common stock subject to this option vest 1/48 th per month commencing February 1, 2021.

(2) Vesting schedule is as follows:

The shares of common stock subject to this option vest 1/48 th per month commencing February 1, 2022.

(3) Vesting schedule is as follows:

The shares of common stock subject to this option vest 1/48 th per month commencing February 1, 2023.

(4) Vesting schedule is as follows:

Fully vested upon issuance on January 2, 2024.

(5) Vesting schedule is as follows:

The shares of common stock subject to this option vest 1/48th per month commencing February 1, 2024.

Policies and Practices Regarding the Grant of Equity Awards

We do not schedule the grant of any equity awards in anticipation of the disclosure of material, non-public information and we do not schedule the disclosure of material, non-public information based on the timing of granting equity awards.

We have not adopted a formal policy that dictates the timing of equity award grants .

We generally grant broad-based equity awards on the first business day of each year.

In addition, we may choose to grant equity awards outside of the annual broad-based awards (e.g., as part of a new hire package or as a retention or promotional incentive).

Stock options may be granted only with an exercise price at or above the closing market price of our common stock on the date of grant.

During 2024, no stock option grants were made to any of our NEOs during any period beginning four business days before the filing or furnishing of a periodic report or current report and ending one business day after the filing or furnishing of any such report with the SEC.

NON-EMPLOYEE DIRECTOR COMPENSATION

We have adopted the following non-employee director compensation program to help us attract and retain highly- qualified directors and to align the interests of our directors with the long-term interests of our stockholders.

Our compensation committee is responsible for reviewing the compensation of our non-employee directors periodically and recommends changes to the board of directors when it deems appropriate.

Our compensation committee conducts this review through the assistance of an external compensation consultant, when appropriate, although the compensation committee ultimately makes its own decision about these matters.

Non-Employee Directors

Under this director compensation program, we pay our non-employee directors (excluding our executive chairman) (i) an annual cash retainer of $70,000 of which the value is converted into stock options;

(ii) an annual cash retainer for service as a chair or member of a committee ranging from $7,500 to $20,000 depending on the committee of which the value is converted into stock options;

and (iii) an annual retention grant of stock options valued at $150,000 as of the grant date, which is scheduled to vest monthly over a period of one year, subject to the director’s continuous service on each applicable vesting date.

Our director compensation program for non-employee directors did not materially change from 2023.

Executive Chairman

At this time, other than Dr.

Litvack, none of the non-employee directors receive any cash compensation for their service.

In 2014, we entered into a consulting agreement with Dr.

Litvack for $10,000 per month, for an aggregate of $120,000 per year which remains in effect.

The consulting services are primarily related to strategic, finance and business development services provided to the Company.

For 2023 service, as executive chairman, Dr.

Litvack was granted a stock option in January 2024 to purchase 200,000 shares, which vest monthly over a four-year period from grant date.

For 2024 services, as executive chairman, Dr.

Litvack was granted a stock option in January 2025 to purchase 50,000 shares, which vest monthly over a one-year period from the grant date.

New Directors

From 2021 to 2024, each new non-employee director was entitled to receive a grant of 115,000 stock options, which were scheduled to vest 25% on the one-year anniversary of the grant date and the remainder vest monthly over the following three years, subject to such director’s continuous service on each applicable vesting date.

Expense Reimbursement

Our non-employee directors are also reimbursed for their reasonable out-of-pocket travel expenses to cover in-person attendance at and participation in board of directors and committee meetings.

2024 Director Compensation Table

The following table sets forth the compensation received by our directors in fiscal year 2024.

Marbán is not listed below because she is an employee of the Company and receives no additional compensation for serving on our Board or its committees.

Please see the 2024 Summary Compensation Table for the compensation received by Dr.

Marbán for her service as our Chief Executive Officer.

Fees Earned or

Option Awards (1)(2)

Frank Litvack, M.D.

(Duke) Collier Jr., J.D.

Dunbar Jr., M.B.A.

Karimah Es Sabar

Paul Auwaerter, M.D., M.B.A.

Philip Gotwals, Ph.D.

Michael Kelliher

(1) Amounts reflect the grant date fair value of awards granted under the 2021 Equity Incentive Plan computed pursuant to Financial Accounting Standards Board’s Accounting Standards Codification 718 “Compensation – Stock Compensation.” Assumptions used in the calculation of these amounts are included in Note 3 – “Stock Awards, Warrants and Options” of the Notes to the Consolidated Financial Statements.

(2) Options granted for the following number of shares were outstanding as of December 31, 2024:

Litvack – 1,190,532 shares;

Collier – 322,054 shares;

Musket – 387,296 shares;

Dunbar – 349,384 shares;

Es Sabar – 231,010 shares;

Auwaerter – 151,900 shares;

Gotwals – 151,950 shares;

Kelliher – 179,870 shares.

(3) Pursuant to the terms of a Consulting Agreement, dated March 24, 2014, Capricor, Inc.

Litvack $10,000 per month, for an aggregate of $120,000, during the year ended December 31, 2024, as consideration for consulting services.

Risk Assessment of Compensation Programs

We do not believe that our compensation programs create risks that are reasonably likely to have a material adverse effect on our Company.

We believe that the combination of different types of compensation as well as the overall amount of compensation, together with our internal controls and oversight by our Board, mitigates potential risks.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The information required by this item will be set forth in the sections entitled “Securities Authorized for Issuance Under Equity Compensation Plans” and “Security Ownership of Certain Beneficial Owners and Management” in our 2024 Proxy Statement and is incorporated herein by reference.

Securities Authorized for Issuance Under Equity Compensation Plans

We have three equity-incentive plans that have been approved by stockholders:

(i) the 2012 Restated Equity Incentive Plan;

(ii) the 2020 Equity Incentive Plan (the “2020 Plan”);

and (iii) the 2021 Equity Incentive Plan (the “2021 Plan”).

The Company also maintains the 2012 Non-Employee Director Stock Option Plan, which has not been approved by stockholders.

At this time, the Company only issues options under the 2020 Plan and 2021 Plan.

The following table sets forth additional information with respect to the shares of common stock that may be issued upon the exercise of options and other rights under our existing equity compensation plans and arrangements in effect as of December 31, 2024.

The information includes the number of shares covered by, and the weighted average exercise price of, outstanding options, warrants and rights, and the number of shares remaining available for future grant, excluding the shares to be issued upon exercise of outstanding options, warrants and rights.

Equity Compensation Plan Information

securities to

Number of securities

remaining available for

upon exercise

future issuance

of outstanding

compensation plans

(excluding securities

reflected in column

Plan Category

Equity compensation plans approved by security holders:

The 2012 Restated Equity Incentive Plan (1)

The 2020 Equity Incentive Plan

The 2021 Equity Incentive Plan

(1) The 2012 Restated Equity Incentive Plan expired in November 2022, therefore, no additional stock option awards may be granted from the 2012 Restated Equity Incentive Plan.

(2) The number of shares available for future issuance under the 2021 Plan shall automatically increase on January 1 of each year by an amount equal to 5% of the outstanding shares of our common stock as of the last day of the immediately preceding fiscal year (rounded down to the nearest whole share).

Security Ownership of Certain Beneficial Owners and Management

The following table sets forth certain information known to us regarding the beneficial ownership of our common stock as of February 28, 2025 by:

● each of our current directors;

● each named executive officer as defined and named in this Annual Report on Form 10-K, and included in the Summary Compensation Table;

● all of our current directors and executive officers as a group;

● each person known by us to beneficially own more than five percent of our common stock (based on information supplied in Schedules 13D and 13G filed with the SEC).

Except as indicated by footnote, and subject to applicable community property laws, each person identified in the table possesses sole voting and dispositive power with respect to all capital stock shown to be held by that person.

The address of each named executive officer and director, unless indicated otherwise, is c/o Capricor Therapeutics, Inc., 10865 Road to the Cure, Suite 150, San Diego, California 92121.

Shares of Common

Percentage of Common

Stock Beneficially

Name of Beneficial Owner

Named Executive Officers and Directors:

Frank Litvack, M.D.

(Duke) Collier Jr., J.D.

Dunbar Jr., M.B.A.

Karimah Es Sabar (6)

Paul Auwaerter, M.D., M.B.A.

Philip Gotwals, Ph.D.

Michael Kelliher (9)

Anthony Bergmann, M.B.A.

Linda Marbán, Ph.D.

Karen Krasney, J.D.

Directors and executive officers as a group (11 individuals)

5% Stockholders:

Highbridge Capital Management, LLC and affiliated entities (13)

BlackRock, Inc.

The Vanguard Group (15)

Nippon Shinyaku Co., Ltd.

*Represents less than 1%.

(1) We have based percentage ownership of our common stock on 45,622,046 shares of our common stock outstanding as of February 28, 2025.

Beneficial ownership is determined in accordance with Rule 13d-3 under the Exchange Act and includes any shares as to which the security holder has sole or shared voting power or dispositive power, and also any shares which the security holder has the right to acquire within sixty (60) days of February 28, 2025, whether through the exercise or conversion of any stock option, convertible security, warrant or other right.

The indication herein that shares are beneficially owned is not an admission on the part of the security holder that he, she or it is a direct or indirect beneficial owner of those shares.

(2) Includes (i) 107,382 shares held by Dr.

(ii) 46,278 shares held by the Litvack Curtis Family Trust;

and (iii) 912,297 shares issuable upon the exercise of stock options held directly by Dr.

Litvack that are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

The shares issuable upon the exercise of stock options issued to Dr.

Litvack are subject to early exercise under the 2021 Plan, the 2020 Plan, and the 2012 Plan.

As of February 28, 2025, Dr.

Litvack has not indicated his intent to exercise early.

(3) Includes (i) 57,606 shares held by Mr.

and (ii) 321,455 shares issuable upon the exercise of stock options which are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

The shares issuable upon the exercise of stock options issued to Mr.

Collier are subject to early exercise under the 2021 Plan and the 2020 Plan.

As of February 28, 2025, Mr.

Collier has not indicated his intent to exercise early.

(4) Includes (i) 7,096 shares held by SEP FBO David B.

Musket, Pershing LLC as Custodian;

(ii) 81,692 shares held by David B.

and (iii) 386,746 shares issuable upon the exercise of stock options held directly by David B.

Musket, which are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

The shares issuable upon the exercise of stock options issued to Mr.

Musket are subject to early exercise under the 2021 Plan, the 2020 Plan, and the 2012 Plan.

As of February 28, 2025, Mr.

Musket has not indicated his intent to exercise early.

(5) Includes (i) 10,556 shares held by Mr.

and (ii) 349,145 shares issuable upon the exercise of stock options that are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

The shares issuable upon the exercise of stock options issued to Mr.

Dunbar are subject to early exercise under the 2021 Plan, the 2020 Plan, and the 2012 Plan.

As of February 28, 2025, Mr.

Dunbar has not indicated his intent to exercise early.

(6) Includes 231,239 shares issuable upon the exercise of stock options which are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

The shares issuable upon the exercise of stock options issued to Ms.

Es Sabar are subject to early exercise under the 2021 Plan.

As of February 28, 2025, Ms.

Es Sabar has not indicated her intent to exercise early.

(7) Includes (i) 5,000 shares held by Dr.

Auwaerter, and (ii) 94,991 shares issuable upon the exercise of stock options which are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

The shares issuable upon the exercise of stock options issued to Dr.

Auwaerter are subject to early exercise under the 2021 Plan.

As of February 28, 2025, Dr.

Auwaerter has not indicated his intent to exercise early.

(8) Includes 95,761 shares issuable upon the exercise of stock options which are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

The shares issuable upon the exercise of stock options issued to Dr.

Gotwals are subject to early exercise under the 2021 Plan.

As of February 28, 2025, Dr.

Gotwals has not indicated his intent to exercise early.

(9) Includes 120,565 shares issuable upon the exercise of stock options which are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

The shares issuable upon the exercise of stock options issued to Mr.

Kelliher are subject to early exercise under the 2021 Plan.

As of February 28, 2025, Mr.

Kelliher has not indicated his intent to exercise early.

(10) Includes (i) 5,723 shares held by Mr.

Bergmann and (ii) 471,790 shares issuable upon the exercise of stock options held directly by Mr.

Bergmann that are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

The shares issuable upon the exercise of stock options issued to Mr.

Bergmann are subject to early exercise under the 2021 Plan, the 2020 Plan, and the 2012 Plan.

As of February 28, 2025, Mr.

Bergmann has not indicated his intent to exercise early.

(11) Includes (i) 198,604 shares held by Dr.

Linda Marbán;

(ii) 920 shares held by Linda and Eduardo Marbán as joint tenants with rights of survivorship;

and (iii) 1,400,906 shares issuable upon the exercise of stock options held directly by Dr.

Linda Marbán which are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

Certain shares issuable upon the exercise of stock options issued to Dr.

Linda Marbán are subject to early exercise under the 2021 Plan, the 2020 Plan, and the 2012 Plan.

As of February 28, 2025, Dr.

Linda Marbán has not indicated her intent to exercise early.

(12) Includes (i) 28,047 shares held by Ms.

Krasney and (ii) 381,684 shares issuable upon the exercise of stock options held directly by Ms.

Krasney that are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

The shares issuable upon the exercise of stock options issued to Ms.

Krasney are subject to early exercise under the 2021 Plan, the 2020 Plan, and the 2012 Plan.

As of February 28, 2025, Ms.

Krasney has not indicated her intent to exercise early.

(13) Includes (i) 2,789,699 shares held by Highbridge Capital Management, LLC and affiliated entities;

and (ii) 2,789,699 shares issuable upon the exercise of warrants held directly by Highbridge Capital Management, LLC and affiliated entities which are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

Capital Management, LLC reports that it holds shared voting power and shared dispositive power with respect to all shares held by it.

The address for Highbridge Capital Management, LLC is 277 Park Avenue, 23rd Floor, New York, New York 10172.

Based solely on information set forth in a Schedule 13G/A filed with the SEC on November 8, 2024.

(14) Includes 2,966,914 shares held by BlackRock, Inc.

(“BlackRock”).

BlackRock reports that it holds sole voting power and sole dispositive power with respect to all shares held by it.

The address for BlackRock is 50 Hudson Yards, New York, New York 10001.

Based solely on information set forth in a Schedule 13G/A filed with the SEC on February 5, 2025.

(15) Includes 2,276,784 shares held by The Vanguard Group.

The Vanguard Group reports that it holds shared voting power and sole and shared dispositive power with respect to all shares held by it.

The address for The Vanguard Group is 100 Vanguard Blvd., Malvern, Pennsylvania 19355.

Based solely on information set forth in a Schedule 13G filed with the SEC on January 30, 2025.

(16) Includes (i) 4,944,429 shares held by Nippon Shinyaku Co., Ltd.;

and (ii) 2,145,922 shares issuable upon the exercise of warrants held directly by Nippon Shinyaku Co., Ltd.

which are exercisable or will become exercisable within sixty (60) days of February 28, 2025.

Nippon Shinyaku Co., Ltd reports that it holds sole voting power and sole dispositive power with respect to all shares held by it.

The address for Nippon Shinyaku Co., Ltd.

is 14, Nishinosho-Monguchi-cho, Kisshoin, Minami-ku, Kyoto 601-8550, Japan.

Based solely on information set forth in a Schedule 13G/A filed with the SEC on September 24, 2024.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE .

The information required by this item will be set forth in the sections entitled “Certain Relationships and Related Party Transactions” and “Information Regarding the Board of Directors and Corporate Governance” in our 2024 Proxy Statement and is incorporated herein by reference.

Certain Relationships and Related Party Transactions

Except as reported below, there have not been transactions since January 1, 2024, in which we were a party, where the amount involved exceeded or will exceed $120,000 and in which any related party, as defined in Item 404 of Regulation S-K, had a direct or indirect material interest.

Nippon Shinyaku Co., Ltd.

Commercialization and Distribution Agreement with Nippon Shinyaku (Territory:

United States)

On January 24, 2022, Capricor entered into a Commercialization and Distribution Agreement (the “ U.S.

Distribution Agreement ”) with Nippon Shinyaku Co.

(“ Nippon Shinyaku ”), a Japanese corporation and a shareholder of the Company.

Under the terms of the U.S.

Distribution Agreement, Capricor will be responsible for the clinical development and manufacturing of deramiocel.

Nippon Shinyaku and NS Pharma, Inc.

(its wholly-owned U.S.

subsidiary) will be responsible for the distribution of deramiocel in the United States.

Pursuant to the U.S.

Distribution Agreement, Capricor received an upfront payment of $30.0 million in 2022.

The first milestone payment of $10.0 million was paid upon completion of the futility analysis of the HOPE-3 trial whereby the outcome was determined to be not futile.

The second milestone payment of $10.0 million was triggered in December 2024 upon submission of the BLA to the FDA seeking marketing approval of deramiocel in the United States.

Additionally, there is another potential milestone of $80.0 million due to Capricor upon receipt of marketing approval.

The foregoing milestones are considered development milestones under the terms of the U.S.

Distribution Agreement.

Further, there are various potential sales-based milestones, if commercialized, tied to the achievement of certain sales thresholds for annual net sales of deramiocel of up to $605.0 million.

Subject to regulatory approval, Capricor will have the right to receive a share of product revenue which falls between 30 and 50 percent.

Commercialization and Distribution Agreement with Nippon Shinyaku (Territory:

On February 10, 2023, Capricor entered into a Commercialization and Distribution Agreement (the “ Japan Distribution Agreement ”) with Nippon Shinyaku.

Under the terms of the Japan Distribution Agreement, Capricor appointed Nippon Shinyaku as its exclusive distributor in Japan of deramiocel for the treatment of DMD.

Under the terms of the Japan Distribution Agreement, Capricor received an upfront payment of $12.0 million in the first quarter of 2023 and in addition, Capricor may potentially receive additional development and sales-based

milestone payments of up to approximately $89.0 million, subject to foreign currency exchange rates, and a meaningful double-digit share of product revenue.

Nippon Shinyaku will be responsible for the distribution of deramiocel in Japan.

Capricor will be responsible for the conduct of clinical development and regulatory approval in Japan, as may be required, as well as the manufacturing of deramiocel.

In addition, Capricor or its designee will hold the Marketing Authorization in Japan if the product is approved in that territory.

Binding Term Sheet with Nippon Shinyaku (Territory:

On September 16, 2024, Capricor entered into a Binding Term Sheet (the “Term Sheet”) with Nippon Shinyaku for the commercialization and distribution of deramiocel for the treatment of DMD in the European region, as defined in the Term Sheet.

Subject to finalization of a definitive agreement, under the terms of the Term Sheet, Capricor would be responsible for the development and manufacturing of deramiocel for potential approval in the European region.

Nippon Shinyaku would be responsible for the sales and distribution of deramiocel in the European region.

Subject to regulatory approval, Capricor would receive a double-digit share of product revenue and additional development and sales-based milestone payments.

If a definitive agreement is entered into on the same economic terms as the term sheet, Capricor will receive an upfront payment of $20.0 million upon execution of the definitive agreement, with potential additional development and sales-based milestone payments of up to $715.0 million.

In the event of execution of a definitive agreement, the Company will evaluate the terms in accordance with ASU 606, Revenue for Contracts from Customers .

As of December 31, 2024, nothing has been recorded or received.

Capricor and Nippon Shinyaku have entered into various amendments to the Term Sheet, pursuant to which the parties agreed to extend the due date for execution of a definitive agreement to April 30, 2025.

September 2024 Private Placement

On September 16, 2024, the Company entered into a Subscription Agreement with Nippon Shinyaku pursuant to which the Company agreed to issue and sell to Nippon Shinyaku in a private placement (the “Private Placement”), an aggregate of 2,798,507 shares of the common stock of the Company at a price per Share of $5.36, which was issued at a 20% premium to the 60-day volume-weighted average price, for an aggregate purchase price of approximately $15.0 million.

The Subscription Agreement also includes lock-up provisions restricting Nippon Shinyaku from selling or otherwise disposing of shares of Common Stock until the six-month anniversary of the Closing Date.

In connection with the Private Placement, the Company also entered into a Registration Rights Agreement with Nippon Shinyaku on September 16, 2024 (the “Registration Rights Agreement”).

Pursuant to the terms of the Registration Rights Agreement, the Company has filed with the SEC a registration statement to register for resale the shares sold in the Private Placement, which registration statement was declared effective on November 8, 2024.

Employment Agreements

Information regarding our executive employment agreements for certain officers is located under the caption, “Employment Agreements and Potential Payments Upon Termination or Change in Control” above.

Director and Officer Indemnification Agreements

In addition to the indemnification provisions contained in our Certificate of Incorporation and Bylaws, we generally enter into separate indemnification agreements with our directors and executive officers.

These agreements require us, among other things, to indemnify the director or executive officer against specified expenses and liabilities, such as attorneys’ fees, judgments, fines and settlements, paid by the individual in connection with any action, suit or proceeding arising out of the individual’s status or service as our director or executive officer, other than liabilities arising from willful misconduct or conduct that is knowingly fraudulent or deliberately dishonest, and to advance expenses incurred by the individual in connection with any proceeding against the individual with respect to which the individual may be entitled to indemnification by us.

We also intend to enter into these agreements with our future directors and executive officers.

Policies and Procedures for Related Party Transactions

Although we have adopted a Code of Business Conduct and Ethics, we rely on the Board to review related party transactions on an ongoing basis to prevent conflicts of interest.

The Board reviews a transaction in light of the affiliations of the director, officer or employee and the affiliations of such person’s immediate family.

Transactions are presented to the Board for approval before they are entered into or, if this is not possible, for ratification after the transaction has occurred.

If the Board finds that a conflict of interest exists, then it will determine the appropriate remedial action, if any.

The Board approves or ratifies a transaction if it determines that the transaction is consistent with the best interests of the Company.

Independence of the Board of Directors

Pursuant to the independence rules of The Nasdaq Stock Market LLC (“Nasdaq”), a majority of the members of a listed company’s board of directors must qualify as “independent,” as affirmatively determined by the board of directors.

The Board consults with our counsel to ensure that the Board’s determinations are consistent with relevant securities and other laws and regulations regarding the definition of “independent,” including those set forth in pertinent listing standards of Nasdaq, as in effect from time to time.

Consistent with these considerations, after review of all relevant identified transactions or relationships between each director, or any of his or her family members, and us, our senior management and our independent auditors, the Board has affirmatively determined that the following eight directors are independent directors within the meaning of the applicable Nasdaq listing standards:

Frank Litvack, Mr.

Earl Collier, Mr.

David Musket, Mr.

George Dunbar, Ms.

Es Sabar, Dr.

Paul Auwaerter, Dr.

Philip Gotwals and Mr.

Michael Kelliher.

In making this determination, the Board found that none of these directors had a material or other disqualifying relationship with us.

In addition to transactions required to be disclosed under SEC rules, the Board considered certain other relationships in making its independence determinations, and determined in each case that such other relationships did not impair the director’s ability to exercise independent judgment on our behalf.

Each of our standing Board committees entirely consist of, and throughout fiscal year 2024 consisted of, independent directors.

Linda Marbán, our President and Chief Executive Officer, is not an independent director by virtue of her employment with the Company.

PRINCIPAL ACCOUNTING FEES AND SERVICES.

The information required by this item will be set forth in the section entitled “Principal Accountant Fees and Services” in our 2023 Proxy Statement and is incorporated herein by reference.

In connection with the audit of the 2024 financial statements, we entered into an engagement agreement with Rose, Snyder & Jacobs LLP which sets forth the terms by which Rose, Snyder & Jacobs LLP would perform audit services for us.

The following is a summary of the approximate fees billed to us by Rose, Snyder & Jacobs LLP, our independent registered public accounting firm, for professional services rendered for the fiscal years ended December 31, 2024 and 2023 which includes Capricor, Inc.

and Capricor Therapeutics, Inc.:

Fiscal Year Ended

Service Category

Audit-Related Fees

All Other Fees

In the above table, in accordance with the SEC’s definitions and rules, “audit fees” are fees for professional services for the audit and review of our annual financial statements, as well as the audit and review of our financial statements included in our registration statements filed under the Securities Act and issuance of consents and for services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements, except those not required by statute or regulation;

“audit-related fees” are fees for assurance and related services that were reasonably related to the performance of the audit or review of our financial statements, including attestation services that are not required by statute or regulation, due diligence and services related to acquisitions;

“tax fees” are fees for tax

compliance, tax advice and tax planning;

and “all other fees” are fees for any services not included in the first three categories which include foreign tax research and consents necessary for applicable filings with the SEC.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

8 unchanged sentences

Certificate of Amendment of Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the SEC on June 4, 2019).

Certificate of Amendment of Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the SEC on May 15, 2024).

Bylaws of the Company (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K, filed with the SEC on February 9, 2007).

74 unchanged sentences

and Cedars-Sinai Medical Center (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the Commission on August 13, 2018).

Sixth Amendment to Facilities Lease, dated as of July 31, 2022, by and between Capricor, Inc.

and Cedars-Sinai Medical Center.

Seventh Amendment to Facilities Lease, dated as of September 26, 2023, by and between Capricor, Inc.

and Cedars-Sinai Medical Center (incorporated by reference to Exhibit 10.6 to the Company’s Quarterly Report on Form 10-Q, filed with the Commission on November 14, 2024).

Restated and Amended Employment Agreement by and among Capricor Therapeutics, Inc., Capricor, Inc.

and Linda Marbán, dated June 5, 2019 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed with the Commission on August 8, 2019).†

First Amendment to Restated and Amended Employment Agreement by and among Capricor Therapeutics, Inc., Capricor, Inc.

and Linda Marbán, dated March 24, 2025.

Employment Agreement by and among Capricor Therapeutics, Inc., Capricor, Inc.

1 unchanged sentence

Bergmann, dated May 14, 2019 (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the Commission on August 8, 2019).†

First Amendment to Restated and Amended Employment Agreement by and among Capricor Therapeutics, Inc., Capricor, Inc.

and Anthony J.

Bergmann, dated March 24, 2025.

Employment Agreement by and among Capricor Therapeutics, Inc., Capricor, Inc.

Krasney, dated May 14, 2019 (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q, filed with the Commission on August 8, 2019).†

First Amendment to Restated and Amended Employment Agreement by and among Capricor Therapeutics, Inc., Capricor, Inc.

Krasney, dated March 24, 2025.

Common Stock Sales Agreement, dated July 22, 2019, between Capricor Therapeutics, Inc.

12 unchanged sentences

and Altman Investment Company, LLC (incorporated by reference to Exhibit 10.54 to the Company’s Annual Report on Form 10-K, filed with the Commission on March 11, 2022).

First Amendment to Lease, dated as of June 8, 2022, by and between Capricor, Inc.

and Altman Investment Company, LLC.

Second Amendment to Lease, dated as of September 8, 2022, by and between Capricor, Inc.

and Altman Investment Company, LLC.

Amendment to Lease, dated as of August 10, 2023, by and between Capricor, Inc.

and Altman Investment Company, LLC.

Fourth Amendment to Lease, dated as of February 26, 2025, by and between Capricor, Inc.

and Altman Investment Company, LLC.

Commercialization and Distribution Agreement, dated as of January 25, 2022, by and among Capricor Therapeutics, Inc., Capricor, Inc.

4 unchanged sentences

(incorporated by reference to Exhibit 10.55 to the Company’s Annual Report on Form 10-K, filed with the Commission on March 17, 2023).

Term Sheet for Distribution of Deramiocel (CAP-1002) in Europe, by and between the Company and Nippon Shinyaku Co., Ltd.

(incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed with the Commission on November 14, 2024).

Subscription Agreement, dated September 16, 2024, by and between the Company and Nippon Shinyaku Co., Ltd.

(incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on September 17, 2024).

Registration Rights Agreement, dated September 16, 2024, by and between the Company and Nippon Shinyaku Co., Ltd.

(incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the SEC on September 17, 2024).

Letter of Intent, dated September 16, 2024, by and between the Company and Nippon Shinyaku Co., Ltd.

(incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K, filed with the SEC on September 17, 2024).

Capricor Therapeutics, Inc.

Insider Trading Policy.

List of Subsidiaries.

55 unchanged sentences

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

What changed 10-K

Item 9A. Controls and Procedures