What changed in this filing

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Item 1. Financial Statements

2024-08-08 compared with 2024-05-02 · 231 added, 92 removed, 474 unchanged (41% of the section changed)

7 unchanged sentences

Marketable securities

Accounts receivable, net

Interest and other receivables

Prepaid and other current assets

Prepaid expenses and other current assets

Total current assets

23 unchanged sentences

THREE MONTHS ENDED

SIX MONTHS ENDED

Product revenue, net

Total revenues

Operating expenses:

Cost of goods sold

Research and development

General and administrative

Selling, general and administrative

Total operating expenses

11 unchanged sentences

THREE MONTHS ENDED

SIX MONTHS ENDED

Net unrealized loss on marketable securities

10 unchanged sentences

Foreign currency translation

Issuance of common stock and

Issuances of common stock and

pre-funded warrant to purchase

2 unchanged sentences

costs of $ 9,000

Issuance of common stock in

Issuances of common stock in

connection with exercise of

Issuances of common stock

under equity plans

Stock-based compensation related to

issuances of common stock and

options for services

Stock-based compensation for

equity-based awards to

employees and directors

Balance at March 31, 2024

Other comprehensive loss

Foreign currency translation

Offering expenses

Issuances of common stock in

connection with exercise of

Stock-based compensation related

to issuance of common stock

to issuances of common stock

and options in exchange

Issuance of common stock

Issuances of common stock

under equity plans

2 unchanged sentences

employees and directors

Balance at March 31, 2024

Employee stock purchases

Balance at June 30, 2024

GERON CORPORATION

22 unchanged sentences

Balance at March 31, 2023

Other comprehensive loss

Foreign currency translation

Issuance of common stock in

connection with exercise of

Stock-based compensation related

to issuances of common stock

and options in exchange

Issuance of common stock

under equity plans

Stock-based compensation for

equity-based awards to

employees and directors

Balance at June 30, 2023

See accompanying notes.

2 unchanged sentences

(IN THOUSANDS)

THREE MONTHS ENDED

SIX MONTHS ENDED

Cash flows from operating activities:

7 unchanged sentences

Changes in assets and liabilities:

Current and noncurrent assets

Accounts receivable, net

Prepaid expenses, interest receivable and other assets

Current and noncurrent liabilities

4 unchanged sentences

Proceeds from maturities of marketable securities

Net cash provided by (used in) investing activities

Net cash used in investing activities

Cash flows from financing activities:

3 unchanged sentences

Proceeds from exercise of warrants

Proceeds from employee stock purchase plan

Net cash provided by financing activities

6 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

JUNE 30, 2024

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 unchanged sentences

In the opinion of management, all adjustments (consisting only of normal recurring accruals) considered necessary for a fair presentation have been included.

Operating results for the three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023 or any other period.

Operating results for the three and six months ended June 30, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024 or any other period.

These unaudited condensed consolidated financial statements and notes should be read in conjunction with the audited financial statements for each of the three years ended December 31, 2023, included in our Annual Report on Form 10-K for the year ended December 31, 2023, or the 2023 Form 10-K.

9 unchanged sentences

In connection with previous public offerings, we issued pre-funded warrants to purchase shares of our common stock.

These pre-funded warrants are exercisable immediately at an exercise price of $ 0.001 per share each, and as of March 31, 2024, none of these pre-funded warrants have been exercised.

These pre-funded warrants are exercisable immediately at an exercise price of $ 0.001 per share each, and as of June 30, 2024, none of these pre-funded warrants have been exercised.

These pre-funded warrants, which represent an aggregate of 59,433,145 shares of common stock, have been included in the computation of basic net loss per share, since their exercise price is negligible and they may be exercised at any time.

3 unchanged sentences

Accordingly, basic and diluted net loss per share is the same for all periods presented in the accompanying condensed consolidated statements of operations.

Since we incurred a net loss for the three months ended March 31, 2024 and 2023, the diluted net loss per share calculation excludes potential dilutive securities o f 84,430,455 and 107,971,822 respectively, related to outstanding stock options and warrants as their effect would have been anti-dilutive.

Since we incurred a net loss for the three and six months ended June 30, 2024 and 2023, the diluted net loss per share calculation excludes potential dilutive securities of 78,759,286 and 97,584,078 respectively, related to outstanding stock options and warrants as their effect would have been anti-dilutive.

Use of Estimates

7 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

JUNE 30, 2024

Accounts Receivable

In general, accounts receivable consists of amounts due from customers, net of customer allowances for cash discounts, product returns, and chargebacks.

Accounts receivable are stated net of an allowance that reflects our current estimate of credit losses expected to occur over the life of the receivable.

In developing our allowance for expected credit losses, we use assumptions to capture the risk of loss, even if remote, based on a number of factors including existing contractual payment terms, individual customer circumstances, historical payment patterns of our customers, a review of the local economic environment and its potential impact on expected future customer payment patterns .

The payment terms on our trade receivables are relatively short.

As a result, our collection risk is mitigated to a certain extent by the fact that sales are collected in a relatively short period of time, allowing for the ability to reduce exposure on defaults if collection issues are identified .

We update our allowance as necessary to reflect expected credit losses over the remaining lives of the accounts receivable for outstanding trade receivables that are past due, have known disputes or have experienced any negative credit events that may result in future collectability issues.

We do not currently expect our current or future exposures to credit losses to have a significant impact on us.

The estimated allowance for expected credit losses was not material as of June 30, 2024, nor were the changes to the allowance during any of the periods presented.

Inventory is recorded at the lower of cost or net realized value, with cost determined under the weighted average method.

Inventory costs include third-party contract manufacturing, third-party packaging services, freight, salaries, wages and stock-based compensation for personnel involved in the manufacturing process, and indirect overhead costs.

We periodically review our inventories to identify obsolete, slow moving, excess or otherwise unsaleable items.

If obsolete, slow moving, excess or unsaleable items are observed and there are no alternate uses for the inventory, we record a write-down to net realizable value.

The determination of net realizable value requires judgment including consideration of many factors, such as estimates of future product demand, product net selling prices, current and future market conditions and potential product obsolescence, among others.

Prior to regulatory approval, we expense costs associated with the manufacture a product candidate to research and development expense unless we are reasonably certain such costs have future commercial use and net realizable value.

Since we consider attaining regulatory approval of a product candidate to be highly uncertain and difficult to predict, we expect only in rare instances that pre-launch inventory will be capitalized, if at all.

We began capitalizing inventory related to RYTELO in the quarter ended June 30, 2024, as we received approval of RYTELO on June 6, 2024, and the related costs were expected to be recoverable through the commercialization of RYTELO.

Cost of Goods Sold

Cost of goods sold includes the cost of producing and distributing inventories that are related to product revenue during the respective period, including salary related and stock-based compensation expense for employees involved with production and distribution, freight, and indirect overhead costs.

Cost of goods sold may also include costs related to excess or obsolete inventory adjustment charges, abnormal costs, unabsorbed manufacturing and overhead costs, and manufacturing variances.

For the three and six months ended June 30, 2024, other than packaging costs, substantially all of our RYTELO inventory sold had a zero-cost basis as it was recorded as research and development expenses prior to the FDA’s approval.

Fair Value of Financial Instruments

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Operating leases are included in operating leases, right-of-use assets and lease liabilities on our condensed consolidated balance sheets.

Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.

Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

represent our obligation to make lease payments arising from the lease.

Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of remaining lease payments over the expected lease term.

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(i) identify the contract(s) with our customer;

(ii) identify the promised goods or services in the agreement and determine whether they are performance obligations, including whether they are distinct in the context of the agreement;

(iii) measure the transaction price, including the constraint on variable consideration;

(ii) identify the promised goods or services in the agreement and determine whether they are performance obligations, based on whether they are capable of being distinct and distinct in the context of the agreement;

(iii) determine the transaction price, including the constraint on variable consideration;

(iv) allocate the transaction price to the performance obligations based on stand-alone selling prices;

and (v) recognize revenue when (or as) we satisfy each performance obligation.

We recognize shipping and handling costs as an expense in cost of goods sold when we transfer control to a customer.

A performance obligation is a promise in an agreement to transfer a distinct good or service to the customer and is the unit of account in Topic 606.

3 unchanged sentences

We allocate the total transaction price to each performance obligation based on the estimated relative stand-alone selling prices of the promised goods or services underlying each performance obligation.

Estimated selling prices for license rights are calculated

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

using an income approach model and include the following key assumptions, judgments and estimates:

Estimated selling prices for license rights are calculated using an income approach model and include the following key assumptions, judgments and estimates:

the development timeline, revenue forecast, commercialization expenses, discount rate and probabilities of technical and regulatory success.

Following is a description of the principal activities from which we generate revenue.

We distribute RYTELO in the U.S.

through third party distributors and specialty pharmacies who are our customers.

The third party distributors subsequently resell our product through their related specialty pharmacy providers to patients and health care providers.

Separately, we have or may enter into payment arrangements with various third-party payers including pharmacy benefit managers, private healthcare insurers and government healthcare programs who provide coverage and reimbursement for our product that have been prescribed to a patient.

The following is a description of the principal activities from which we generate revenue.

License fees and royalty revenue primarily represent amounts earned under agreements that out-license our technology to various companies.

To date, our only source of product revenue has been from the U.S.

sales of RYTELO, which we began shipping to our customers in June 2024.

See Note 2 Revenue Recognition.

Net Product Revenues

Our net product revenues are recognized, net of variable consideration related to certain allowances and accruals, at the time our customers obtain control of our product, which is generally upon delivery to our customers.

We use the expected value method, which

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

is the sum of probability-weighted amounts in a range of possible consideration amounts to estimate variable consideration and consideration payable to parties other than our customers related to our product sales.

We record reserves, based on contractual terms, for components related to product sold during the reporting period, as well as our estimate of product that remains in the distribution channel inventory at the end of the reporting period that we expect will be sold to qualified healthcare providers.

On a quarterly basis, we update our estimates and record any needed adjustments in the period we identify the adjustments.

We sell RYTELO to our customers at wholesale acquisition cost, and calculate product revenue from RYTELO sales, net of variable consideration and consideration payable to parties other than our customers.

Variable consideration and consideration payable to parties other than our customers consists of estimates related to the following categories:

Other Allowances

We pay fees for distribution services, such as fees for certain data that customers provide to us.

We estimate our customers will earn these fees and deduct these fees from gross product revenues and accounts receivable at the time we recognize the related revenues.

Discounts for Prompt Payment

We provide for prompt payment discounts to our customers, which are recorded as a reduction in gross product revenue in the same period that the related product revenue is recognized.

Product Returns

We offer customers the right to return products if they are damaged, defective, or expired, as defined in customer agreements.

We estimate product returns considering experience from similar products in the market, historical return patterns, sales data, and inventory levels in the distribution channel.

These estimates are recorded as a reduction in gross product revenue at the time of sale.

Once products are returned, they are destroyed;

we do not record a right of return asset.

Chargebacks occur when our contracted customers, mainly federal agencies that can purchase off the Federal Supply Schedule and Public Health Service 340B covered entities, buy directly from our distributors and wholesalers at discounted prices.

The distributors and wholesalers then charge us the difference between their purchase price and the discounted price.

We estimate chargebacks considering the terms of the applicable arrangement and our visibility regarding utilization.

These chargebacks are recorded in the same period as the related revenue, reducing our net product revenue and receivables.

We typically issue credits for these amounts within a few weeks of notification.

Government Rebates

We are subject to discount obligations under government programs.

Reserves for rebates payable under these government programs are recorded in the same period as gross product revenue, reducing our gross product revenue and creating a liability in accrued liabilities.

Major rebates include those from the Medicare and Medicaid programs.

Estimates for rebates are made considering statutory discount rates and expected utilization.

These estimates are updated each period with actual claims and other current information, taking into account historical data, comparable products and other considerations.

Co-payment Assistance

We offer co-payment assistance to patients with commercial insurance that have coverage and reside in states that allow co-payment assistance.

We estimate the average co-payment assistance amounts for our products based on expected customer demographics and record any such amounts within accrued expenses and a reduction to product revenue.

License Agreements

2 unchanged sentences

which acquired Asterias Biotherapeutics, Inc.) in 2013, we are entitled to receive royalties on sales of certain research or commercial products utilizing Geron’s divested intellectual property.

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

For agreements with sales-based royalties, including milestone payments based on the level of sales, where the license is deemed to be the predominant item to which the royalties relate, we recognize revenue at the later of (a) when the related sales occur, or (b) when the performance obligation, to which some or all of the royalty has been allocated, has been satisfied (or partially satisfied).

23 unchanged sentences

The grant-date fair value for service-based restricted stock awards is determined using the fair value of our common stock on the date of grant.

We evaluate whether an adjustment to the assumptions of

We evaluate whether an adjustment to the assumptions of fair value of our common stock and historical volatility are required if observed prices of our common stock materially differ from historical information.

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

fair value of our common stock and historical volatility are required if observed prices of our common stock materially differ from historical information.

The following table summarizes the stock-based compensation expense included in operating expenses on our condensed consolidated statements of operations related to stock options and employee stock purchases for the three months ended March 31, 2024 and 2023, which was allocated as follows:

Three Months Ended March 31,

JUNE 30, 2024

The following table summarizes the stock-based compensation expense included in operating expenses on our condensed consolidated statements of operations related to stock options and employee stock purchases for the three and six months ended June 30, 2024 and 2023, which was allocated as follows:

Three Months Ended June 30,

Six Months Ended June 30,

(In thousands)

Research and development

General and administrative

Stock-based compensation expense included in

operating expenses

As stock-based compensation expense recognized in our condensed consolidated statements of operations for the three months ended March 31, 2024 and 2023 is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures, but at a minimum, reflects the grant-date fair value of those awards that actually vested in the period.

Selling, general and administrative

Total stock-based compensation expense

Stock-based compensation of $ 0.1 million was capitalized to inventory for the three and six months ended June 30, 2024.

As stock-based compensation expense recognized in our condensed consolidated statements of operations for the three and six months ended June 30, 2024 and 2023 is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures, but at a minimum, reflects the grant-date fair value of those awards that actually vested in the period.

Forfeitures have been estimated at the time of grant based on historical data and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

We have not recognized any stock-based compensation expense for any remaining performance-based stock options on our condensed consolidated statements of operations for the three months ended March 31, 2024 and 2023, as achievement of the specified strategic milestones associated with the remaining performance-based stock options was not considered probable at that time.

We have recognized stock-based compensation expense for the achievement of a milestone achieved upon FDA approval of RYTELO on our condensed consolidated statements of operations for the three and six months ended June 30, 2024 and 2023.

Stock Options

2 unchanged sentences

Performance-based stock options vest upon the achievement of specified strategic milestones.

The fair value of service-based stock options granted during the three months ended March 31, 2024 and 2023 has been estimated at the date of grant using the Black Scholes option-pricing model with the following assumptions:

Three Months Ended March 31,

The fair value of service-based stock options granted during the six months ended June 30, 2024 and 2023 has been estimated at the date of grant using the Black- Scholes option-pricing model with the following assumptions:

Six Months Ended June 30,

Dividend yield

7 unchanged sentences

Employee Stock Purchase Plan

The fair value of employees’ stock purchase rights during the three months ended March 31, 2024 and 2023 has been estimated using the Black Scholes option-pricing model with the following assumptions:

Three Months Ended March 31,

The fair value of employees’ stock purchase rights during the six months ended June 30, 2024 and 2023 has been estimated using the Black-Scholes option-pricing model with the following assumptions:

Six Months Ended June 30,

Dividend yield

14 unchanged sentences

The expected term of employees’ stock purchase rights is equal to the purchase period.

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Non-Employee Stock-Based Awards

1 unchanged sentence

We recognize stock-based compensation expense for the fair value of the vested portion of non-employee stock-based awards on our condensed consolidated statements of operations.

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

Segment Information

12 unchanged sentences

For all other entities, ASU 2020-06 is effective for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years.

We adopted ASU 2020-06 as of January 1, 2024, it did not have a material impact on our condensed consolidated financial statements.

We adopted ASU 2020-06 as of January 1, 2024 and it did not have a material impact on our condensed consolidated financial statements.

New Accounting Pronouncements – Issued But Not Yet Adopted

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Other recent accounting pronouncements issued by the FASB did not or are not believed by management to have a material impact on our condensed consolidated financial statements.

REVENUE RECOGNITON

Net Product Revenue

To date, our only source of product revenue has been from the U.S.

sales of RYTELO, which we began shipping to our customers in June 2024.

The reconciliation of gross product sales to net product sales by each significant category of gross-to-net adjustments was as follows for the three and six months ended June 30, 2024 (in thousands):

Three and Six Months Ended

(in thousands)

Gross product revenue

Gross-to-net adjustments:

Chargebacks and distributor service fees

Government rebates

Sales returns and allowances

Total gross-to-net adjustments (1)

Net product revenue

(1) As of June 30, 2024 approximately $ 0.1 million of estimated gross-to-net accruals have been recorded within accounts payable and accrued expenses on the condensed consolidated balance sheets.

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

JUNE 30, 2024

All of our inventories are related to the manufacturing of RYTELO.

The following table presents our inventory as of June 30, 2024 (in thousands):

Six Months Ended

(in thousands)

Finished goods

Total inventory

FAIR VALUE MEASUREMENTS

Cash Equivalents and Marketable Securities

Cash equivalents, restricted cash and marketable securities by security type at March 31, 2024 were as follows:

Cash equivalents, restricted cash and marketable securities by security type at June 30, 2024 were as follows:

(In thousands)

1 unchanged sentence

Money market funds

Commercial Paper

Restricted cash:

2 unchanged sentences

Marketable securities:

Treasury securities - due in 1 to 2 years

Treasury securities (due in

less than one year)

Government-sponsored enterprise

securities (due in less than one year)

Government-sponsored enterprise securities

(due in one to two years)

Commercial paper (due in less than

3 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

JUNE 30, 2024

Cash equivalents, restricted cash and marketable securities by security type at December 31, 2023 were as follows:

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Cash equivalents and marketable securities with unrealized losses that have been in a continuous unrealized loss position for less than 12 months and 12 months or longer at March 31, 2024 and December 31, 2023 were as follows:

JUNE 30, 2024

Cash equivalents and marketable securities with unrealized losses that have been in a continuous unrealized loss position for less than 12 months and 12 months or longer at June 30, 2024 and December 31, 2023 were as follows:

Less Than 12 Months

1 unchanged sentence

(In thousands)

As of March 31, 2024:

US Treasury Securities (due in less than one year)

As of June 30, 2024:

US Treasury Securities (due in less than

Government-sponsored enterprise

securities (due in less than one year)

Government-sponsored enterprise

securities (due in one to two years)

Commercial paper (due in less than

10 unchanged sentences

The gross unrealized losses related to U.S.

Treasury securities, municipal securities, government-sponsored enterprise securities, commercial paper and corporate notes as of March 31, 2024 and December 31, 2023 were due to changes in interest rates and not credit risk.

Treasury securities, municipal securities, government-sponsored enterprise securities, commercial paper and corporate notes as of June 30, 2024 and December 31, 2023 were due to changes in interest rates and not credit risk.

If an available-for-sale security’s fair value is less than its amortized cost basis, we evaluate whether the decline is the result of a credit loss, in which case an impairment is recorded through an allowance for credit losses.

We have not recorded any allowances for credit losses on our available-for-sale securities for the three months ended March 31, 2024 and 2023 as we have not identified any unrealized losses for these securities attributable to credit factors.

We have not recorded any allowances for credit losses on our available-for-sale securities for the three and six months ended June 30, 2024 and 2023 as we have not identified any unrealized losses for these securities attributable to credit factors.

Our exposure to unrealized losses may increase in the future due to the economic pressures or uncertainties associated with macroeconomic or other global economic conditions, including those resulting from inflation, rising interest rates, prospects of a recession, bank failures and other disruptions to financial systems, civil or political unrest, military conflicts, pandemics or other health crises.

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Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Money market funds are categorized as Level 1 within the fair value hierarchy as their fair values are

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

based on quoted prices available in active markets.

JUNE 30, 2024

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Money market funds are categorized as Level 1 within the fair value hierarchy as their fair values are based on quoted prices available in active markets.

Treasury securities, municipal securities, government-sponsored enterprise securities, commercial paper, and corporate notes are categorized as Level 2 within the fair value hierarchy as their fair values are estimated by using pricing models, quoted prices of securities with similar characteristics or discounted cash flows.

The following table presents information about our financial instruments that are measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023 and indicates the fair value category assigned.

The following table presents information about our financial instruments that are measured at fair value on a recurring basis as of June 30, 2024 and December 31, 2023 and indicates the fair value category assigned.

Fair Value Measurements at Reporting Date Using

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(In thousands)

As of March 31, 2024:

As of June 30, 2024:

Money market funds (1)(2)

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ACCRUED LIABILITIES

Accrued liabilities consisted of the following as o f March 31, 2024 and December 31, 2023:

Accrued liabilities consisted of the following as o f June 30, 2024 and December 31, 2023:

(In thousands)

3 unchanged sentences

Interest payable

On September 30, 2020, we, Hercules Capital, Inc., or Hercules, and Silicon Valley Bank, a Division of First-Citizens Bank & Trust Company (successor by purchase to the Federal Deposit Insurance Corporation as receiver for Silicon Valley Bridge Bank, N.A.

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

JUNE 30, 2024

(as successor to Silicon Valley Bank)), or SVB, entered into a term loan facility, or the Original Loan Agreement, consisting of up to $ 75.0 million aggregate principal amount available to us, as amended in August 2021.

2 unchanged sentences

On December 14, 2023, we entered into a third amendment to the Original Loan Agreement, or as amended, the Loan Agreement.

As of March 31, 2024, a total of $ 80.0 million has been drawn under the Loan Agreement.

As of June 30, 2024, a total of $ 80.0 million has been drawn under the Loan Agreement.

On the effective date of the second amendment, we paid $ 100,000 as a facility charge that we recognized as a debt discount and are amortizing such cost to interest expense over the life of the loan using the effective interest rate method.

1 unchanged sentence

We also incurred legal fees in connection with the second amendment, which we recognized as debt issuance costs and are amortizing such cost to interest expense over the life of the loan using the effective interest rate method.

Under the third amendment, the aggregate principal amount drawn down and remaining available to us under the Term Loan remains at $ 125.0 million, with such principal being available in a series of tranches, subject to certain terms and conditions.

The third amendment also provides that (i) the fourth tranche of the Term Loan was increased from $ 10.0 million to $ 30.0 million, (ii) the commitment period for the fifth tranche of the Term Loan of $ 20.0 million, which is available subject to achievement of a regulatory milestone and satisfaction of certain capitalization requirements, was extended through December 15, 2024, (iii) the variable annual interest rate on the outstanding loans has been decreased to the greater of:

Under the third amendment, the aggregate principal amount drawn down and remaining available to us under the Loan Agreement remains at $ 125.0 million, with such principal being available in a series of tranches, subject to certain terms and conditions.

The third amendment also provides that (i) the fourth tranche of the Loan Agreement was increased from $ 10.0 million to $ 30.0 million, (ii) the commitment period for the fifth tranche of the Loan Agreement of $ 20.0 million, which was made available due to achievement of a regulatory milestone and satisfaction of certain capitalization requirements and was extended through December 15, 2024, (iii) the variable annual interest rate on the outstanding loans has been decreased to the greater of:

(x) 9.0 %, or (y) the sum of (A) the Prime Rate (as reported in The Wall Street Journal) minus 4.5 %, plus (B) 9.0 %;

and (iv) the interest only period of the Term Loan has been extended through June 30, 2024, and is further extendable to December 31, 2024 upon achievement of a regulatory and financial milestone and satisfaction of certain capitalization requirements.

In connection with the third amendment, on the third amendment effective date, we borrowed and received the entire fourth tranche of the Term Loan in the amount of $ 30.0 million.

and (iv) the interest only period of the Loan Agreement has been extended from June 30, 2024 through December 31, 2024, due to regulatory approval of RYTELO and satisfaction of certain financial and capitalization requirements.

In connection with the third amendment, on the third amendment effective date, we borrowed and received the entire fourth tranche of the Loan Agreement in the amount of $ 30.0 million.

After giving effect to such borrowing, the outstanding principal amount under the Loan Agreement is $ 80.0 million.

3 unchanged sentences

The third amendment of the Loan Agreement is not substantially different as compared to the Original Loan Agreement, and accordingly, we treated the amendment as a modification of the debt in accordance with ASC 470.

On September 15, 2023, the third tranche of $ 20.0 million of the Term Loan expired and is no longer available for us, but was added to the fourth tranche as part of the third amendment to the Loan Agreement.

Under the Term Loan as amended, the Term Loan matures on April 1, 2025 , or the Loan Maturity Date, and may be extended up to an additional six months upon the achievement of certain regulatory and financial milestones.

The Term Loan bears interest at a floating rate per annum equal to the greater of either (i) 9.0 % or (ii) the sum of (A) the Prime Rate (as reported in The Wall Street Journal) minus 4.5 %, plus (B) 9.0 % ( 8.5 % as of December 31, 2023).

The interest only period of the Term Loan is through June 30, 2024, and is further extendable to December 31, 2024 upon achievement of a regulatory and financial milestone and satisfaction of certain capitalization requirements.

Following the expiration of the interest-only period, we are required to repay the Term Loan in equal monthly amortization payments of principal and interest until the Loan Maturity Date.

Upon full repayment of the Term Loan, we are also obligated to pay an end of term charge in an amount equal to 6.55 % of the amount of the Term Loans actually borrowed.

Such end of term charge is being accrued to interest expense over the term of the Term Loan using the effective interest rate method.

On September 15, 2023, the third tranche of $ 20.0 million of the Loan Agreement expired and is no longer available for us, but was added to the fourth tranche as part of the third amendment to the Loan Agreement.

Under the Loan Agreement as amended, the Loan Agreement matures on October 1, 2025 , or the Loan Maturity Date, which was extended from April 1, 2025 upon regulatory approval of RYTELO.

The Loan Agreement bears interest at a floating rate per annum equal to the greater of either (i) 9.0 % or (ii) the sum of (A) the Prime Rate (as reported in The Wall Street Journal) minus 4.5 %, plus (B) 9.0 % ( 8.5 % as of December 31, 2023).

The interest only period of the Loan Agreement has been extended from June 30, 2024 through December 31, 2024.

due to regulatory approval of RYTELO and satisfaction of certain financial and capitalization requirements.

Following the expiration of the interest-only period, we are required to repay the Loan Agreement in equal monthly amortization payments of principal and interest until the Loan Maturity Date.

Upon full repayment of the Loan Agreement, we are also obligated to pay an end of term charge in an amount equal to 6.55 % of the amount of the Loan Agreement actually borrowed.

Such end of term charge is being accrued to interest expense over the term of the Loan Agreement using the effective interest rate method.

At our option, upon at least five business days’ prior written notice to Hercules, we may prepay all or any portion greater than or equal to $ 5.0 million of the outstanding loan by paying the entire principal balance (or portion thereof) and all accrued and unpaid interest.

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Thereafter, any prepayment of Tranche 3, Tranche 4, Tranche 5 or Tranche 6 is not subject to a prepayment charge.

We are in compliance with the covenants under the Loan Agreement as of March 31, 2024.

As of March 31, 2024, the net carrying value of the debt under the Loan Agreement was $ 82,745,000 , which includes the principal amount of $ 80,000,000 less net unamortized debt discounts and issuance costs of $ 458,000 plus accrued end of term charge of $ 3,204,000 .

The carrying value of the debt approximates the fair value as of March 31, 2024.

We are in compliance with the covenants under the Loan Agreement as of June 30, 2024.

As of June 30, 2024, the net carrying value of the debt under the Loan Agreement was $ 83.4 million , which includes the principal amount of $ 80.0 million less net unamortized debt discounts and issuance costs of $ 331,000 plus accrued end of term charge of $ 3.8 million.

The carrying value of the debt approximates the fair value as of June 30, 2024.

The debt discounts and debt issuance costs are being amortized to interest expense over the life of the outstanding loan amounts using the effective interest rate method.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

The following table presents future minimum payments, including interest and the end of term charge, under the Loan Agreement as of March 31, 2024 (in thousands):

JUNE 30, 2024

The following table presents future minimum payments, including interest and the end of term charge, under the Loan Agreement as of June 30, 2024 (in thousands):

Remainder of 2024

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The court granted final approval of the settlement on September 28, 2023 and final judgment was entered on October 3, 2023.

Under the terms of the Stipulation, in exchange for the release and dismissal with prejudice of all claims against the defendants in the consolidated class action complaint, we agreed to pay and/or to cause our insurance carriers to pay a total of $ 24,000,000 , comprised of $ 17,000,000 in cash, which was paid into an escrow account under our available directors' and officers', or D&O insurance coverage and, $ 7,000,000 in cash which was paid after final approval of the settlement by the court.

Under the terms of the Stipulation, in exchange for the release and dismissal with prejudice of all claims against the defendants in the consolidated class action complaint, we agreed to pay and/or to cause our insurance carriers to pay a total of $ 24.0 million, comprised of $ 17.0 million in cash, which was paid into an escrow account under our available directors' and officers', or D&O insurance coverage and, $ 7.0 million in cash which was paid after final approval of the settlement by the court.

The settlement does not constitute an admission of fault or wrongdoing by Geron or any of our officers .

Our portion of the settlement amount was paid in the fourth quarter of 2023.

There is no liability outstanding as of March 31, 2024 as the matter was fully settled during the year ended December 31, 2023.

There is no liability outstanding as of June 30, 2024 as the matter was fully settled during the year ended December 31, 2023.

In 2020 and 2021, seven shareholder derivative actions were filed in a number of courts, naming as defendants certain of our then current officers and certain of our then current and former members of our board.

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In the second quarter of 2023, our insurance carriers paid $ 525,000 in cash, and we paid $ 825,000 in cash, for an aggregate total payment of $ 1,350,000 .

Accordingly, there are no outstanding amount to settle against this as of March 31, 2024.

Accordingly, there are no outstanding amount to settle against this as of June 30, 2024.

While we have settled these lawsuits, it is possible that additional lawsuits might be filed, or allegations might be received from stockholders, with respect to these same or other matters and also naming us and/or our officers and directors as defendants.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

JUNE 30, 2024

Indemnifications to Officers and Directors

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The severance plans also provide that they shall not supersede the provisions of any individual employment agreements entered into between us and our employees, and that the employees with such agreements will be entitled to whichever benefits are greater under the severance plan or their employment agreement.

A copy of the severance plan covering our executive officers is filed as an exhibit to our annual report on Form 10-K.

As March 31, 2024, all our executive officers have employment agreements with severance provisions and will receive the greater severance benefits of their agreements or those in the severance plan applicable to them.

A copy of the severance plan covering our executive officers is filed as an exhibit to the 2023 Form 10-K.

As of June 30, 2024, all our executive officers have employment agreements with severance provisions and will receive the greater severance benefits of their agreements or those in the severance plan applicable to them.

Purchase Commitments

We have engaged third‑party contract manufacturers and have re-established our own manufacturing supply chain to manufacture and supply additional quantities of RYTELO that meet applicable regulatory standards for current and potential future clinical trials and commercial uses.

Related to those contract manufacturing agreements, we have noncancelable commercial purchase commitments for approximately $ 62.5 million in the aggregate as of June 30, 2024.

These purchase commitments can vary based on the commercial demand of RYTELO and are binding based on future manufacturing needs.

In the normal course of business, we enter into agreements with CROs for clinical trials for clinical and commercial supply manufacturing and with other vendors for non-clinical research studies, investigator-led trials and other services and products for operating purposes.

We have not considered these payments to be contractual obligations since the contracts are generally cancellable at any time by us upon less than 180 days’ prior written notice.

We also have certain in-license agreements that require us to pay milestones to such third parties upon achievement of certain development, regulatory or commercial milestones.

Amounts related to contingent milestone payments are not considered contractual obligations as they are contingent on the successful achievement of certain development, regulatory approval and commercial milestones, which may not be achieved.

STOCKHOLDERS’ EQUITY

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The public offering price of the 2024 pre-funded warrant was $ 2.99 per share.

The 2024 pre- funded warrant has an exercise price of $ 0.001 per share and may be exercised at any time until the 2024 pre-funded warrant is exercised in full.

As of March 31, 2024 , none of the 2024 pre-funded warrant has been exercised.

The 2024 pre- funded warrant has an exercise price of $ 0.001 per share and may be exercised at any time

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

until the 2024 pre-funded warrant is exercised in full.

As of June 30, 2024 , none of the 2024 pre-funded warrant has been exercised.

The net cash proceeds from the March 2024 offering were approximately $ 141.0 million, after deducting the underwriting discount and other offering expenses paid by us, and excluding any future proceeds from the exercise of the pre-funded warrant.

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Based on our evaluation, we concluded the 2024 pre-funded warrant should be classified as equity with no subsequent remeasurement as long as such warrant continue to be classified as equity.

GERON CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Warrant Exercises

In the first quarter of 2024, warrants to purchase 37,640 s hares of our common stock were exercised for net cash proceeds of approximately $ 49,000 .

In the first quarter of 2024, warrants to purchase 37,640 shares of our common stock were exercised for net cash proceeds of approximately $ 49,000 .

In the second quarter of 2024, warrants to purchase 281,211 shares of our common stock were exercised for net cash proceeds of approximately $ 365,000 .

The warrants were issued in connection with underwritten public offerings of common stock and pre-funded warrants, together with accompanying stock purchase warrants in May 2020.

As of March 31, 2024, the following warrants remained outstanding:

As of June 30, 2024, the following warrants remained outstanding:

• pre-funded warrants with an exercise price of $ 0.001 per share to purchase 59,433,145 shares of our common stock, which have no expiration date;

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

What changed 10-Q

Item 1. Financial Statements