HCW Biologics Inc. 10-Q

Item 1. Financial Statements. HCW Biologics Inc. Condensed Balance Sheets December 31, June 30, 2024 2025 Unaudited ASSETS Current assets: Cash and cash equivalents $ 4,674,572 $ 2,438,962 Accounts receivable, net 582,201 21,611 Prepaid expenses 328,181 295,543 Other current assets 113,528 141,009 Total current assets 5,698,482 2,897,125 Investments 1,599,751 3,348,438 Property, plant and equipment, net 22,909,869 22,635,596 Other assets 28,476 28,477 Total assets $ 30,236,578 $ 28,909,636 LIABILITIES AND STOCKHOLDERS’ DEFICIT Liabilities Current liabilities: Accounts payable $ 22,332,261 $ 19,354,476 Accrued liabilities and other current liabilities 981,940 1,070,421 Short-term debt, net 6,314,684 6,421,204 Total current liabilities 29,628,885 26,846,101 Debt, net 7,377,865 367,151 Contingent liability - related party — 1,748,356 Total liabilities 37,006,750 28,961,608 Commitments and contingencies (Note 11) Stockholders’ deficit: Common stock: Common, $ 0.0001 par value; 250,000,000 shares authorized and 1,113,532 shares issued at December 31, 2024; 250,000,000 shares authorized and 2,146,601 shares issued at June 30, 2025 111 215 Additional paid-in capital 93,785,854 104,628,555 Accumulated deficit ( 100,556,137 ) ( 104,680,742 ) Total stockholders’ deficit ( 6,770,172 ) ( 51,972 ) Total liabilities and stockholders’ deficit $ 30,236,578 $ 28,909,636 See accompanying notes to the unaudited condensed interim financial statements. 1 HCW Biologics Inc. Condensed Statements of Operations (Unaudited) Three Months Ended June 30, Six Months Ended June 30, 2024 2025 2024 2025 Revenues: Revenues $ 618,854 $ 6,550 $ 1,745,566 $ 11,615 Cost of revenues ( 438,443 ) ( 5,240 ) ( 950,408 ) ( 9,292 ) Net revenues 180,411 1,310 795,158 2,323 Operating expenses: Research and development 2,029,186 1,226,824 4,152,470 2,705,536 General and administrative 1,594,193 2,096,021 3,160,285 4,302,301 Legal expenses (recoveries), net 10,393,042 142,542 14,812,076 ( 1,596,951 ) Nonoperating loss 1,300,000 — 1,300,000 — Total operating expenses 15,316,421 3,465,387 23,424,831 5,410,886 Loss from operations ( 15,136,010 ) ( 3,464,077 ) ( 22,629,673 ) ( 5,408,563 ) Interest expense ( 159,666 ) ( 228,714 ) ( 159,666 ) ( 505,853 ) Unrealized gain on investment - 1,748,688 — 1,748,688 Other income, net 15,485 16,373 41,086 41,122 Net loss $ ( 15,280,191 ) $ ( 1,927,730 ) $ ( 22,748,253 ) $ ( 4,124,606 ) Equity dividend to investor - ( 10,153,799 ) - ( 10,153,799 ) Net loss attributable to Common Stockholders $ ( 15,280,191 ) $ ( 12,081,529 ) $ ( 22,748,253 ) $ ( 14,278,405 ) Net loss per share, basic and diluted $ ( 16.16 ) $ ( 6.79 ) $ ( 24.25 ) $ ( 9.86 ) Weighted average shares outstanding, basic and diluted 945,585 1,780,113 938,087 1,448,502 See accompanying notes to the unaudited condensed interim financial statements. 2 HCW Biologics Inc. Condensed Statements of Changes in Stockholders’ Equity (Deficit) For the Six Months Ended June 30, 2024 and 2025 (Unaudited) Stockholders’ Equity (Deficit) Common Stock Additional Paid-In Accumulated Total Stockholders’ Shares Amount Capital Deficit Equity (Deficit) Balance, January 1, 2024 900,628 $ 90 $ 83,993,950 $ ( 70,532,323 ) $ 13,461,717 Issuance of Common Stock upon exercise of stock options 314 1 2,254 — 2,255 Issuance of Common Stock upon equity subscription 44,643 4 2,500,001 — 2,500,005 Stock-based compensation — — 244,685 — 244,685 Net loss — — — ( 7,468,061 ) ( 7,468,061 ) Balance, March 31, 2024 945,585 $ 95 $ 86,740,890 $ ( 78,000,384 ) $ 8,740,601 Issuance of Common Stock upon exercise of stock options — — — — — Stock-based compensation — — 239,821 — 239,821 Net loss — — — ( 15,280,191 ) ( 15,280,191 ) Balance, June 30, 2024 945,585 $ 95 $ 86,980,711 $ ( 93,280,575 ) $ ( 6,299,769 ) Stockholders’ Deficit Common Stock Additional Paid-In Accumulated Total Stockholders’ Shares Amount Capital Deficit Deficit Balance, January 1, 2025 1,113,532 $ 111 $ 93,785,854 $ ( 100,556,137 ) $ ( 6,770,172 ) Issuance of Common Stock upon exercise of stock options 205 — 1,654 — 1,654 Issuance of Common Stock to Square Gate 9,616 1 149,999 — 150,000 Issuance cost of Common Stock — — ( 22,297 ) — ( 22,297 ) Stock-based compensation — — 275,642 — 275,642 Net loss — — — ( 2,196,875 ) ( 2,196,875 ) Balance, March 31, 2025 1,123,353 $ 112 $ 94,190,852 $ ( 102,753,012 ) $ ( 8,562,048 ) Issuance of Common Stock 194,242 20 1,592,784 — 1,592,804 Issuance of pre-funded warrants — — 4,207,718 — 4,207,718 Issuance of common stock warrants — — 9,650,404 — 9,650,404 Exercise of pre-funded warrants 513,140 51 - — 51 Issuance cost of Common Stock — — ( 70,094 ) — ( 70,094 ) Issuance cost of pre-funded warrants — — ( 504,862 ) — ( 504,862 ) Issuance cost of common stock warrants — — ( 227,646 ) — ( 227,646 ) Equity dividend to investor ( 10,153,799 ) ( 10,153,799 ) Issuance of Common Stock to extinguish restructured debt 253,083 25 1,774,087 — 1,774,112 Issuance of common stock warrants to extinguish restructured debt 544,249 — 544,249 Gain on conversion of debt with related parties, net — — 3,346,562 — 3,346,562 Stock-based compensation — — 278,307 — 278,307 Adjustment for reverse stock split 62,783 7 ( 7 ) — - Net loss — — - ( 1,927,730 ) ( 1,927,730 ) Balance, June 30, 2025 2,146,601 $ 215 $ 104,628,555 $ ( 104,680,742 ) $ ( 51,972 ) See accompanying notes to the unaudited condensed interim financial statements. 3 HCW Biologics Inc. Condensed Statements of Cash Flows (Unaudited) Six Months Ended June 30, 2024 2025 Cash flows from operating activities: Net loss $ ( 22,748,253 ) $ ( 4,124,606 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and accretion 373,433 710,926 Stock-based compensation 484,506 553,949 Commitment fee — 150,000 Unrealized gain on investment — ( 1,748,688 ) Loss on conversion of debt with related parties ( 131,134 ) Changes in the carrying amount of right-of-use asset ( 418 ) — Changes in operating assets and liabilities: Accounts receivable 880,784 560,590 Prepaid expenses and other assets 703,805 5,156 Accounts payable and other liabilities 11,896,608 ( 2,772,352 ) Operating lease liability ( 56,541 ) — Net cash used in operating activities ( 8,466,076 ) ( 6,796,159 ) Cash flows from investing activities: Purchases of property and equipment ( 111,142 ) — Net cash (used in) provided by investing activities ( 111,142 ) — Cash flows from financing activities: Proceeds from issuance of Common Stock 2,502,260 1,475,939 Proceeds from issuance of pre-funded warrants — 3,822,894 Proceeds from issuance of debt 3,700,000 150,000 Issuance costs for Common Stock and pre-funded warrants — ( 824,899 ) Debt repayment ( 58,829 ) ( 63,385 ) Net cash provided by financing activities 6,143,431 4,560,549 Net decrease in cash and cash equivalents ( 2,433,787 ) ( 2,235,610 ) Cash and cash equivalents at the beginning of the period 3,595,101 4,674,572 Cash and cash equivalents at the end of the period $ 1,161,314 $ 2,438,962 Supplemental disclosure of cash flow information: Cash paid for interest, net of amounts capitalized $ 159,666 $ 404,162 Noncash investing activities: Capital expenditures accrued, but not yet paid $ 1,769,621 $ — Purchases of property and equipment included in accounts payable and other $ 829,207 $ 13,000 Noncash financing activities: Extinguishment of restructured debt $ — $ 7,440,462 Issuance of Common Stock, warrants and other rights upon extinguishment of restructured debt $ — $ 3,962,766 Gain on extinguishment of debt with related parties $ — $ 3,477,696 Equity dividend to investor $ — $ 10,153,799 See accompanying notes to the unaudited condensed interim financial statements. 4 HCW Biologics Inc. Notes to Condensed Interim Financial Statements (Unaudited) 1. Organization and Summary of Significant Accounting Policies Organization HCW Biologics Inc. (the “Company”) is a biopharmaceutical company focused on discovering and developing novel immunotherapies to lengthen healthspan by disrupting the link between chronic, low-grade inflammation and age-related diseases. The Company believes age-related low-grade chronic inflammation, or “inflammaging,” is a significant contributing factor to several chronic diseases and conditions, such as cancer, cardiovascular disease, diabetes, neurodegenerative diseases, and autoimmune diseases. The Company is located in Miramar, Florida and was incorporated in the state of Delaware in April 2018. Reverse Stock Split On March 31, 2025, at a Special Meeting of the Stockholders (the “Special Meeting”), the stockholders of the Company approved a reverse stock split of all outstanding shares of the Common Stock, and the Board approved a reverse stock split of the Common Stock at a final ratio of one-for-forty ( 1 ::40) (the “Reverse Stock Split”). The Reverse Stock Split was effective at 12:01 a.m. Eastern Time on April 11, 2025. The Common Stock commenced trading on a reverse split-adjusted basis when the markets opened on April 11, 2025, under the existing trading symbol “HCWB.” In addition to the Reverse Stock Split, the stockholders approved two other proposals at the Special Meeting: (1) use of our equity line of credit to raise up to $ 40.0 million through sales of shares of the Company’s Common Stock thereunder and (2) execution of the principal terms for the conversion of up to approximately $ 6.9 million of the outstanding principal of Secured Notes into shares of Common Stock. All authorized, issued, and outstanding shares of common stock, preferred stock, stock option awards, and per share data included in these financial statements have been recast to give retrospective effect to the adjusted authorized shares and Reverse Stock Split for all periods presented. The Reverse Stock Split did not have any effect on the stated par value of the Company’s Common Stock or the rights and privileges of the holders of shares of Common Stock. Options, warrants and convertible securities outstanding immediately prior to the Reverse Stock Split were appropriately adjusted to reflect the Reverse Stock Split. Liquidity and Going Concern In accordance with ASC 205-40, Presentation of Financial Statements – Going Concern (“Topic 205-40”), we are required to evaluate whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern for at least 12 months from the issuance date of the Company’s condensed interim financial statements. This evaluation does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented or are not within control of the Company as of the date the financial statements are issued. When substantial doubt exists under this methodology, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. As of June 30, 2025, the Company had not generated any revenue from commercial product sales of its internally developed immunotherapeutic products for the treatment of cancer and other age-related diseases. During its development activities, the Company has sustained operating losses, experienced negative operating cash flows and negative working capital position and it expects to continue to incur operating losses for the foreseeable future. Since inception to June 30, 2025, the Company incurred cumulative net losses of $ 102.0 million. These losses reflect a $ 5.3 million res erve for credit losses and a $ 1.3 million nonoperating losses reported in prior periods. 5 To date, the Company has funded operations primarily through the sale of stock and warrants, issuance of Secured Notes and other debt, and revenues generated from the Company’s exclusive worldwide licenses and its development supply agreement with Wugen Inc. (“Wugen”), pursuant to which Wugen licensed limited rights to develop, manufacture, and commercialize cell-based therapy treatments for cancer based on two of our internally-developed, multi-cytokine fusion protein molecules, HCW9201 and HCW9206. In the quarter ended June 30, 2025, the Company agreed to a request from Wugen to suspend the Wugen License, including Wugen’s clinical trial due diligence obligations and its obligation to pay up to $ 500,000 annually to reimburse the Company for certain R&D expenses. The suspension will run for a period of one year from the effective date and will end on May 29, 2026. During the suspension, the Company has the exclusive right to seek alternate licensees and terminate the license in order to enter other business development transactions related to the ex vivo use of the licensed molecules. In the quarter ended June 30, 2025, WY Biotech Co., Ltd. (“WY Biotech”) notified the Company that it had completed its due diligence and review of the technical report delivered by the Company and elected to proceed with next steps pursuant to the exclusive worldwide license agreement between WY Biotech and the Company with respect to development and commercialization of one of HCWB’s preclinical product candidates, HCW11-006, for in vivo applications (as amended, the “WY Biotech License”). As a result, WY Biotech is financially obligated to the Company, as detailed in the WY Biotech License, as amended, including the obligation to pay a $ 7.0 million upfront license fee. WY Biotech is in the process of finalizing agreements with its contract development and manufacturing organization (“CDMO”) and investors. Since the Company has no payment history with WY Biotech, it did not recognize the upfront license fee as revenue as we concluded collectability was not probable. In order to accommodate WY Biotech’s timing in finalizing agreements, the Company and WY Biotech agreed to extend the latest date for payment of the $ 7.0 million license fee to September 30, 2025 . During the period ended June 30, 2025, the Company extinguished $ 7.7 million of debt through restructuring or conversion of debt. This was accomplished by restructuring $ 7.4 million of Secured Notes, including accumulated accretion of a fixed bonus payable upon Maturity Date, through the Second Amendment to the Amended and Restated Note Purchase Agreement and converting $ 270,000 of unsecured promissory notes according to the terms of the purchase agreement. Both transactions include the right to a portion of the proceeds received on the liquidation or sale of the Wugen shares, if such an event occurs. The Company maintains ownership of the Wugen shares included in these transactions and has recorded a contingent liability to account for the right to receive proceeds upon liquidation or sale of the Wugen shares. The noteholders for this debt consisted of officers, directors and other significant stockholders. Due to the related party nature of the converting noteholders, the gain on restructuring and loss on conversion were recorded to additional paid-in capital for the period ended June 30, 2025. On August 15, 2022, the Company entered into a loan and security agreement (the “2022 Loan Agreement”) with Cogent Bank, pursuant to which it received $ 6.5 million in proceeds to purchase a property at which the Company planned to build a facility to manufacture biologics and upgrade its research laboratory facilities. The loan is secured by a first priority lien on the property. As of June 30, 2025, certain subcontractors had filed mechanics liens related to unpaid invoices issued in connection with construction of the Company’s new manufacturing facilities and upgraded research laboratories. The 2022 Loan Agreement contains a provision for a discretionary default in the event that the Company fails to pay sums due in connection with construction of any improvements; however, as of the reporting date, the lender has not elected to do so. As of June 30, 2025, the Company has reflected this loan as Short-term debt, net, to reflect that the lender has the right to accelerate the loan under a discretionary default provision. On January 22, 2025, the Company entered into a forbearance agreement with BE&K Building Group (“BE&K”), its general contractor, to allow the Company until March 31, 2025 to continue efforts to find the financing required to complete the construction and renovation of the property. Pursuant to the forbearance agreement, the Company made an initial payment of $ 1.0 million in partial satisfaction of amounts owing to BE&K and its subcontractors. As the Company reported in a Form 8-K, on April 17, 2025, the Company received a summons and a copy of a complaint filed by BE&K in the Circuit Court of the 17th Judicial Circuit in and for Broward County, Florida (the “BE&K Complaint”). Other Defendants named in the BE&K Complaint who are subcontractors elected to file counterclaims and cross-claims as part of their responses to the BE&K Complaint. Cogent Bank, also named as a Defendant in the BE&K Complaint, has not elected to take legal action at this time. In addition, on April 28, 2025, the Company received a summons and a copy of a complaint filed by Fisk Electric Company (which is a defendant in the BE&K Complaint) in the Circuit Court of the 17th Judicial Circuit in and for Broward County, Florida (the “Fisk Complaint”) against the Company, BE&K, and the other defendants in the BE&K Complaint. On August 8, 2025, B&I Contractors, Inc., one of the defendants in the BE&K Complaint, filed a motion for summary judgment (the “MSJ”) as to the Count I (Foreclosure of Construction Lien). The Company has responded to the BE&K and Fisk Complaints and cross-claims and intends to file a timely response to the B&I MSJ. 6 As of July 13, 2024, the Company and Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer, entered into a confidential Settlement Agreement and Release (the “Settlement Agreement”) with ImmunityBio and its affiliates. The Settlement Agreement includes mutual general releases by and among the parties thereto. No party was required to make any monetary payments to any other party or person under the Settlement Agreement and each party will bear its own expenses incurred in connection with the matter. The Arbitration and related Complaint were dismissed on December 24, 2024. With the execution of the Settlement Agreement, the Company resolved the attendant uncertainties for the outcome of the Arbitration and additional complexities, and it launched its new financing plan. In the accompanying condensed balance sheet as of June 30, 2025, the Com pany reported a balance of $ 12.3 million for legal fees incurred but not yet paid that were included within Accounts payable and an accrual of $ 8,000 for accrued legal fees within Accrued liabilities and other current liabilities. The Company is engaged in discussions with the law firms involved wi th this matter to arrange a reasonable payment plan with respect to those legal fees. In the six months ended June 30, 2025, the Company received a $ 2.0 million insurance payment, which was paid directly to the law firm who represented Dr. Wong for his defense during the Arbitration. The insurance payment is reported within Legal expenses, net in the condensed interim statement of operations for the six months ended June 30, 2025. With the ability to approach the equity markets post Settlement, the Company raised gross proceeds of $ 11.9 million through the issuance of equity securities in two offerings to the same intuitional investor who was the sole investor in both financings (the “Investor”). The first financing occurred on November 18, 2024, when the Company raised gross proceeds of $ 6.9 million in a registered direct offering and a concurrent private placement of common stock and warrants. This offering priced above market under Nasdaq rules and closed on November 20, 2024. The second financing occurred pursuant to a purchase agreement entered into on May 13, 2025, when the Company raised gross proceeds of $ 5.0 million in a follow-on public offering of common stock and warrants. This offering priced at the market under Nasdaq rules and closed on May 15, 2025. Contemporaneously with the May 2025 financing, the Company entered into an agreement with the Investor to set a new exercise price, of $ 7.45 per share, with respect to certain Common Stock Warrants to purchase 167,925 shares of the Company’s Common Stock which were issued in November 2024. See Note 4. Sale of Common Stock and Warrants . Prior to the May 2025 financing, the Company obtained bridge financing in the form of a $ 150,000 promissory note, guaranteed by securities held by the Company’s Founder and Chief Executive Officer, and in the form of a $ 270,000 unsecured promissory note which converted to equity on May 15, 2025 according to the provision of the loan documents. See Note 3. Debt, Net. On February 20, 2025 , the Company entered into an Equity Purchase Agreement and a related Registration Rights Agreement with Square Gate Capital Master Fund, LLC - Series 4 (“Square Gate”), pursuant to which the Company will have the right, but not the obligation, to sell to Square Gate, and Square Gate will have the obligation to purchase from the Company, up to $ 20.0 million (the “Maximum Commitment Amount”) worth of the Company’s shares of Common Stock, at the Company’s sole discretion, over the next 36 months (the “Put Shares”), subject to certain conditions precedent and other limitations. On April 16, 2025, the U.S. Securities and Exchange Commission (“SEC”) declared a registration statement effective to register shares required to sell up to $ 40.0 million of the Company’s shares to Square Gate, according to provisions of the Equity Purchase Agreement. See Note 7. Standby Equity Purchase Agreement. On June 26, 2025, the Company announced that it received formal notice from Nasdaq that the Company was in compliance with Listing Rule 5550(b)(1) (the “Equity Rule”). On May 13, 2025, the Company received formal notice from Nasdaq that it regained compliance with the bid price requirement in Listing Rule 5550(a)(2), the public float requirement in Listing Rule 5550(a)(4), and the market value of publicly held shares requirement in Listing Rule 5550(a)(5). As a result, the Company is in compliance with all applicable criteria for continued listing on the Nasdaq Capital Market tier, and the previously disclosed listing compliance matters have been closed. The Company was also notified that it will remain subject to a “Panel Monitor,” as that term is defined in Nasdaq Listing Rule 5815(d)(4)(B), for a period of one year from the date of the Nasdaq notice, through June 23, 2026. If, during the term of the Panel Monitor, the Company does not continue to remain in compliance with the Equity Rule, the Company will not be provided with the opportunity to submit a compliance plan for review by the Listing Qualifications Staff and must instead request a hearing before the Panel to address the deficiency, with such request staying any further action with respect to the Company’s listing on Nasdaq pending completion of the hearing process. 7 As of June 30, 2025, the conclusion of a going concern assessment, before consideration of our financing plans, was that there is substantial doubt about the Company’s ability to continue as a going concern. Future financial transactions planned in the next twelve months consist of business development transactions for out licenses and corporate partnering, as well as the sale of Common Stock through Put Shares to Square Gate under the Equity Purchase Agreement. The Company considered future elements of its financing plan that were probable and likely to be implemented within the next year to determine if financing activities currently underway are sufficient mitigate the substantial doubt in the going concern analysis, in addition to considering continued operating losses and the burden of obligations for expenses incurred in connection with past legal proceedings. Management concluded that there were no mitigating circumstances which alleviated the substantial doubt over its ability to continue as a going concern. If the Company is not successful in raising additional capital through these activities, management intends to revise its business plan and reduce costs. If such revisions are insufficient, the Company may have to curtail or cease operations. The accompanying condensed interim financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above. The Company believes that substantial doubt exists regarding its ability to continue as a going concern for at least 12 months from the date of issuance of the Company’s audited financial statements and that the substantial doubt that existed in its going concern analysis was not alleviated. Summary of Significant Accounting Policies Basis of Presentation Unaudited Interim Financial Information The accompanying unaudited condensed interim financial statements as of June 30, 2025 and for the three and six-month periods ended June 30, 2024 and 2025 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to Article 10 of Regulation S-X of the Securities Act of 1933, as amended (the “Securities Act”). Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. These unaudited condensed interim financial statements include only normal and recurring adjustments that the Company believes are necessary to fairly state the Company’s financial position and the results of its operations and cash flows. The results for the three and six-month periods ended June 30, 2025 are not necessarily indicative of the results expected for the full fiscal year or any subsequent interim period. The condensed interim balance sheet at December 31, 2024 has been derived from the audited financial statements at that date but does not include all disclosures required by U.S. GAAP for complete financial statements. Because all of the disclosures required by U.S. GAAP for complete financial statements are not included herein, these unaudited condensed interim financial statements and the notes accompanying them should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2024 which appear in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission (the “SEC”) on March 28, 2025 (the “Annual Report”) and in other filings with the SEC. Segment Reporting The Company operates and manages its business as one reportable and operating segment, which is the business of developing and commercializing novel immunotherapies for diseases promoted by chronic inflammation, especially age-related diseases. The Company’s chief executive officer, who is the chief operating decision maker (“CODM”), reviews financial information on an aggregate basis for allocating and evaluating financial performance. In addition, our CODM is regularly provided with detailed results of preclinical and clinical data which is considered in his decision for the allocation of resources. See Note 10. Segment Reporting for further details. The single operating segment constitutes all of the Company activity, the chief operating decision maker regularly reviews the entity-wide operating results and performance . All long-lived assets are maintained in the United States of America. 8 Reclassification of Prior Period Presentation of Legal Expenses Certain prior period amounts have been reclassified to distinguish between General and administrative expenses in the ordinary course of business and legal expenses incurred in connection with the arbitration and Settlement Agreement described in Liquidity and Going Concern in this Note 1. Reclassification of legal expenses incurred in connection with legal proceedings impacts the condensed interim statements of operations. There is no effect on reporting results of operations from prior periods. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Management must apply significant judgment in this process. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could differ from estimates. Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, Fair Value Measurement (“Topic 820”), establishes a fair value hierarchy for those instruments measured at fair value that distinguishes between fair value measurements based on market data (observable inputs) and those based on the Company’s own assumptions (unobservable inputs). This hierarchy maximizes the use of observable inputs and minimizes the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: Level 1: Observable inputs such as quoted prices in active markets; Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and Level 3: Unobservable inputs in which there is little or no market data, which require a reporting entity to develop its own assumptions. Fair value measurements are classified based on the lowest level of input that is significant to the measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, which may affect the valuation of the assets and liabilities and their placement within the fair value hierarchy levels. The determination of the fair values takes into account the market for the Company’s financial assets and liabilities, the associated credit risk, and other factors as required. The Company considers active markets as those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Revenue Recognition The Company accounts for revenues in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (“Topic 606”). To determine revenue recognition for arrangements that fall within the scope of Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that it will collect the consideration it is entitled to in exchange for the goods or services transferred to the customer. At contract inception, the Company assesses the goods or services promised within each contract, determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. To date, the Company's revenues have been generated exclusively from the Wugen License. The Wugen License consists of licenses of intellectual property, cost reimbursements, upfront signing fees, milestone payments and royalties on future licensee’s product sales. In addition, the Company and Wugen have an agreement for the supply of clinical and research grade materials under which the Company also recognized revenues. 9 License Grants: For out-licensing arrangements that include a grant of a license to the Company’s intellectual property, the Company considers whether the license grant is distinct from the other performance obligations included in the arrangement. For licenses that are distinct, the Company recognizes revenues from nonrefundable, upfront payments and other consideration allocated to the license when the license term has begun and the Company has provided all necessary information regarding the underlying intellectual property to the customer, which generally occurs at or near the inception of the arrangement. Milestone and Contingent Payments: At the inception of the arrangement and at each reporting date thereafter, the Company assesses whether it should include any milestone and contingent payments or other forms of variable consideration in the transaction price using the most likely amount method. If it is probable that a significant reversal of cumulative revenue would not occur upon resolution of the uncertainty, the associated milestone value is included in the transaction price. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of each such milestone and any related constraint and, if necessary, adjusts its estimate of the overall transaction price. Since milestone and contingent payments may become payable to the Company upon the initiation of a clinical study or filing for or receipt of regulatory approval, the Company reviews the relevant facts and circumstances to determine when the Company should update the transaction price, which may occur before the triggering event. When the Company updates the transaction price for milestone and contingent payments, the Company allocates the changes in the total transaction price to each performance obligation in the agreement on the same basis as the initial allocation. Any such adjustments are recorded on a cumulative catch-up basis in the period of adjustment, which may result in recognizing revenue for previously satisfied performance obligations in such period. The Company’s licensees will generally pay milestones payments subsequent to achievement of the triggering event. Materials Supply: The Company provides clinical and research grade materials so that licensees may develop products based on the licensed molecules. The amounts billed are recognized as revenue as the performance obligations are satisfied by the Company, once the Company determines that a contract exists. On June 18, 2021, the Company entered into a master services agreement (“MSA”) with Wugen for the supply of materials for clinical development of licensed products. Each of these transactions represents a single performance obligation that is satisfied over time. The Company recognizes revenue using an input method based on the costs incurred relative to the total expected cost, which determines the extent of the Company’s progress toward completion. As part of the accounting for these arrangements, the Company must develop estimates and assumptions that require judgement to determine the progress towards completion. The Company reviews its estimate of the progress toward completion based on the best information available to recognize the cumulative progress toward completion as of the end of each reporting period, and makes revisions to such estimates, if facts and circumstances change during each reporting period. For each in process SOW, amounts are billed in the same quarter the costs are incurred. For the three months ended June 30, 2024 and June 30, 2025, the Company recogni zed $ 618,854 and $ 6,550 in re venue, respectively, related to sale of development supply materials to the Company’s licensee, Wugen. In the six months ended June 30, 2024 and June 30, 2025, the Company recognized $ 1.7 million and $ 11,615 in revenue, respectively, related to sale of clinical materials to Wugen. In the three months ended June 30, 2025, the Company agreed to Wugen’s request to suspend the Wugen License for a period of one year, ending on May 29, 2026. Investments The Company holds a minority equity interest in Wugen. Prior to the current reporting period as of June 30, 2025, the Company accounted for the Wugen shares using the measurement alternative whereby the investment is recorded at cost less impairment, adjusted for observable price changes in orderly transactions for an identical or similar investment of the same investee. No impairment has been recognized. With support provided by a third-party valuation advisor for the valuation of the shares, during the current reporting period as of June 30, 2025, the Company elected to measure its investment at fair value. The Company will remeasure the change in fair value of the Wugen shares in subsequent reporting periods and recognize the change in earnings. As of December 31, 2024 and June 30, 2025, the Company included $ 1.6 million and $ 3.3 million, respectively, for its investment in Wugen in Investments in the accompanying condensed interim balance sheets. For further discussion of the impact of the fair value measurement for the investment in Wugen, see Note 3. Debt, net - “Troubled Debt Restructuring” and “Contingent Liability.” 10 The Company invests excess cash in bills and notes issued by the U.S. Treasury which are classified as trading securities. As of December 31, 2024 and June 30, 2025 , the Company had no Short-term investments. Operating Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in Other assets, Accrued liabilities and Other current liabilities, and Other liabilities on its condensed interim balance sheets. Operating lease Right of Use (“ROU”) assets and Operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The Company has a lease agreement with lease and non-lease components, which are accounted for separately. For short-term leases with a term of one year or less, the Company uses the practical expedient and does not record an ROU asset or lease liability for such short-term leases. Net Loss Per Share Basic loss per share of common stock is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during each period. Diluted loss per share of common stock includes the effect, if any, from the potential exercise of stock options and unvested shares of restricted stock, which would result in the issuance of incremental shares of common stock. For diluted net loss per share, the weighted-average number of shares of common stock is the same for basic net loss per share due to the fact that when a net loss exists, dilutive securities are not included in the calculation as the impact is anti-dilutive. Standby Equity Purchase Agreement The Company entered an Equity Purchase Agreement providing for an equity line of credit with an investor on February 20, 2025. This arrangement is in the nature of a Standby Equity Purchase Agreement (“SEPA”), which is an equity-linked instrument for which an entity has the right, but not the obligation, to sell the entity’s common stock to third-party investors over a specified period. The total number of shares that the entity may issue to the investor is capped by either an aggregate dollar amount or an aggregate number of shares. Furthermore, the number of shares that an entity may issue at any particular time during the life of the SEPA is also limited. The price payable by the investor for each share of common stock purchased from the entity is generally discounted. In exchange for its access to capital through the SEPA, the entity typically provides up-front consideration to the investor in the form of cash or shares of the entity’s common stock. Economically, before the entity has elected to sell shares, a SEPA represents a purchased put option on the entity’s own equity. However, once the entity “draws” on the SEPA, the related number of shares issuable constitutes a forward contract to issue common stock. Thus, a SEPA contains both a purchased put option element and a forward share issuance element. This generally means that a SEPA generally does not qualify for equity classification. Accordingly, entities must recognize an asset or liability for its SEPA. Such asset or liability must be measured at fair value, with changes in fair value recognized in net (loss) income. Because SEPAs do not qualify for classification in equity, an entity must expense as incurred the amount by which any consideration provided to the investor at the inception of the arrangement exceeds the fair value of the asset recognized for the SEPA. An entity should recognize at fair value the common shares issued to the investor upon settlement of a SEPA by using the quoted price of the shares on the date of issuance. The then-current fair value of the asset or liability for the associated forward share issuance contract must be derecognized in conjunction with the settlement. The proceeds received from the investor are reflected and any residual amount must be charged (or credited) to earnings. This accounting is consistent with the guidance in ASC 815 that applies upon the settlement of a derivative instrument. When an equity-linked instrument classified as an asset or liability is settled, entities should measure the instrument at its current fair value as of the settlement date and include in earnings any previously unrecognized fair value gain or loss. 11 In summary, upon settlement of a forward issuance contract element of a SEPA, an entity would recognize in earnings the following amounts: • The gain (loss) for the excess (deficit) of (a) the carrying amount of the asset or liability for the forward issuance contract plus the proceeds received and (b) the fair value of the common shares as of the issuance date. • Any issuance or transaction costs incurred in conjunction with the issuance of the shares. 2. Accrued Liabilities and Other Current Liabilities As of December 31, 2024 , the Company had a balance of $ 981,940 included in Accrued liabilities and other current liabilities in the audited condensed balance sheet, consisting of $ 422,000 for construction expenses, $ 49,000 for manufacturing expenses, $ 155,000 for legal fees, $ 121,000 for clinical expenses, $ 5,000 for bonus expense, $ 202,000 for salary expenses and $ 28,000 for other liabilities. As of June 30, 2025 , the Company had a balance of $ 1.1 million included in Accrued liabilities and other current liabilities in the accompanying condensed interim balance sheet, consisting of $ 422,000 for construction expenses, $ 87,000 for property taxes, $ 52,000 for manufacturing expenses, $ 193,000 for legal fees, $ 127,000 for clinical expenses, and $ 180,000 for salary expenses. 3. Debt, Net Cogent Bank Loan On August 15, 2022, the Company entered the 2022 Loan Agreement with Cogent Bank, pursuant to which it received $ 6.5 million in proceeds to purchase a property where the Company planned to construct a manufacturing facility for biologics and upgraded research laboratory facilities. The loan is secured by a first priority lien on the building. As of June 30, 2025, the Compa ny had $ 6.3 million in principal outstanding under the 2022 Loan Agreement. The interest-only period was one year followed by 48 months of equal payments of principal and interest beginning on September 15, 2023 based on a 25-year amortization rate. The unamortized balance is due on August 15, 2027 (the “Maturity Date”), and bears interest at a fixed per annum rate equal to 5.75 %. Upon the Maturity Date, a final payment of unamortized principal will be due. The Company is in compliance with covenants related to current payment of principal and interest as of June 30, 2025. The Company has the option to prepay the outstanding balance of the loan prior to the Maturity Date without penalty. As of December 31, 2024 and June 30, 2025, certain subcontractors filed mechanics liens related to unpaid invoices issued in connection with the Company’s construction of its new manufacturing facilities and upgraded research laboratories. The 2022 Loan Agreement contains a provision for a discretionary default in the event that the Company fails to pay sums due in connection with construction of any improvements; however, as of the reporting date, the lender has not elected to do so. As of December 31, 2024 and June 30, 2025, the Company has reflected this loan as Short-term debt, net, to reflect that the lender has the right to accelerate the loan under a discretionary default provision. Senior Secured Notes As of June 30, 2025, there was $ 325,000 of outstanding principal amount of Secured Notes reported in Debt, net in the accompanying condensed interim balance sheet. As of June 30, 2025, the Company restructured $ 6.6 million outstanding principal of Secured Notes by conversion to equity. On May 1, 2025, those noteholders who elected to convert their outstanding principal to equity entered the Second Amendment to the Amended and Restated Note Purchase Agreement (the “Conversion Agreement”). On May 7, 2025, $ 6.6 million of outstanding principal amount of Secured Notes were extinguished upon conversion. See discussion in section “Troubled Debt Restructuring of Secured Notes” below. Those noteholders who elected not to convert had no change in terms, except for the termination of their conversion feature. Under the terms of the agreement, the Secured Notes continue to bear interest at a rate of 9 % per annum, payable quarterly in arrears. The Secured Notes will mature on August 30, 2026 (the “Maturity Date”), on which date the principal balance, accrued but unpaid interest and other amounts owed under the terms of the agreement shall be due and payable. The Company pledged its equity ownership interest in Wugen, which was equivalent to a 5.6 % ownership stake in that company as of June 30, 2025 (“Pledged Collateral”). The Pledged Collateral will be held and released according to the terms of the Escrow Agreement, as security for the Secured Notes. 12 The Secured Notes have a Mandatory Prepayment provision, according to which the Company is required to prepay the Secured Notes before the Maturity Date under certain circumstances. In the event of a Mandatory Prepayment, Secured Notes may receive a bonus payment based on the gross proceeds of the sale of the Pledged Collateral. The agreement also contains default provisions, according to which, following an event of default, the Company may be required to distribute the Pledged Collateral to the Purchasers on a pro rata basis based on a $ 10.0 million issuance of Secured Notes, in full satisfaction of the indebtedness evidenced by the Secured Notes. If the Secured Notes are repaid on the Maturity Date, holders will receive their pro rata share of a fixed bonus payment of $ 3.4 million in addition to payment of outstanding principal and accrued and unpaid interest. If a bonus payment is paid, then there is no prepayment penalty. In the three and six months ended June 30, 2025, the Company recognized $ 102,248 and $ 375,308 , respectively as an expense for accretion of the fixed bonus payment due in the event the Secured Notes are repaid on the Maturity Date, presented within Depreciation in the accompanying condensed interim statements of operations. On May 7, 2025, upon conversion of $ 6.6 million of outstanding principal of Secured Notes, accretion of the fixed bonus was terminated for these Secured Notes and the accumulated accretion balance of $ 860,462 was derecognized. See discussion in section “Troubled Debt Restructuring of Secured Notes” below. For those Secured Notes which remain outstanding, as of June 30, 2025, the Company reported $ 367,151 for the outstanding principal and accumulated accretion of a fixed bonus payment due upon maturity as a noncurrent liability in Debt, net in the accompanying condensed interim balance sheet. Troubled Debt Restructuring of Senior Secured Notes The Company entered into the Second Amendment to its Secured Note in which certain Secured Note noteholders and the Company agreed to the terms to effectively extinguished $ 7.4 million of debt through the issuance of 253,083 shares of Common Stock, warrants to purchase 126,540 shares of Common Stock, and rights to receive a pro rata share of 49.11 % of the proceeds or shares from the Company’s investment in Wugen. The transaction was accounted for under ASC 470-60 as a troubled debt extinguishment, as the Company was experiencing financial difficulty and it was granted a concession by Secured Note noteholders whereby the fair value of consideration transferred was less than the carrying amount of the Secured Notes. The net carrying amount of the restructured Secured Notes at the time of the amendment was $ 7.4 million including principal of $ 6.6 million and accumulated accretion of a fixed bonus payable upon Maturity Date of $ 860,462 . The fair value of consideration transferred including Common Stock, warrants to purchase Common Stock, and rights to proceeds of a portion of the Company’s shares of Wugen common stock was $ 4.0 million, with the difference of $ 3.5 million being recognized as a troubled debt restructuring gain. Due to the related party nature of the converting noteholders, the gain was recorded to additional paid-in capital for the period ended June 30, 2025. Unsecured Promissory Notes As of May 5, 2025, the Company issued a total of $ 270,000 principal amount of unsecured convertible promissory notes that mature on May 5, 2026 with paid in kind interest accruing thereon, payable quarterly in arrears at 10 % per annum (the “Convertible Bridge Notes”). In accordance with their terms, following the completion of a qualified offering, the Convertible Bridge Notes were converted into shares of our Common Stock at the final offering price in an offering that closed on May 15, 2025. In addition, holders of the Convertible Bridge Notes have the right to receive a portion of the proceeds of the Company’s shares of Wugen common stock, if and when such shares are ever sold, determined by the number of the Wugen shares equal to 0.25 multiplied by the original principal amount, in dollars, of the Convertible Bridge Notes. Investors included: $ 60,000 invested by Hing C. Wong, the Company’s Founder and CEO; $ 100,000 invested by Scott T. Garrett, the Chairman of the Company’s Board of Directors; and $ 10,000 invested by Gary M. Winer, who was a member of the Company’s Board of Directors at the time of his investment. As of May 15, 2025, the outstanding principal of Convertible Bridge Notes were converted. The fair value of consideration transferred including 36,242 shares of Common Stock and rights to proceeds of a portion of the Company’s shares of Wugen common stock was $ 401,134 , with the difference of $ 131,134 being recognized as a loss on conversion. Due to the related party nature of the converting noteholders, the loss was recorded to additional paid-in capital for the period ended June 30, 2025. 13 Promissory Note with Personal Guarantee On May 8, 2025, the Company issued a promissory note for $ 150,000 , secured by a personal guaranty and pledge given by the Company’s Founder and CEO, Dr. Hing C. Wong (“Guarantor”) in accordance with the provisions of that certain Guaranty and Pledge Agreement of even date herewith between the Company and the Holder. The promissory note was issued with an original issue discount of $ 75,000 . On the Maturity Date of February 7, 2026 , the Company will repay $ 225,000 . There are provisions which allow the Company to prepay the promissory note before the Maturity Date. The proceeds of this promissory note were used to pay the expenses required to be paid prior to the equity financing which closed on May 15, 2025. The Company is accreting the original issue discount on a straight-line basis over the seven-month term. There is no current interest due on the promissory note with personal guarantee. In the three and six months ended June 30, 2025, the Company recognized accretion of original issue discount of $ 0 and $ 14,722 , respectively, in Interest expense in the accompanying condensed interim statements of operations. Contingent Liabilities The Company extinguished $ 6.9 million of debt through conversion or restructuring of outstanding principal to shares of the Company’s Common Stock, warrants to purchase the Company’s Common Stock and the right to receive proceeds of a liquidation or sale of a portion of the Company’s Wugen shares. The Company retained ownership of the Wugen shares allocated to the converted noteholders and recorded a contingent liability for the right to receive proceeds upon liquidation or sale, if such event occurs. As of June 30, 2025, the Company elected to measure its investment in Wugen at fair value. Similar to the underlying asset, the Company recognized the contingent liability at fair value and will recognize changes in fair value in subsequent reporting periods in earnings. As of June 30, 2025, the Company included $ 1.7 million for this contingent liability in the accompanying condensed interim balance sheets. 4. Sale of Common Stock and Warrants May 2025 Equity Financing On May 13, 2025, the Company entered into a securities purchase agreement with a single institutional investor (the “Investor”) for the issuance and sale of (i) 158,000 shares (the “Shares”) of the Company’s Common Stock and (ii) pre-funded warrants to purchase up to 513,140 shares of Common Stock (the “Pre-Funded Warrants”) in a follow- on public offering (the “Offering”), pursuant to a registration statement filed under Rule 424(b)(4) (File No. 333-287136), which was declared effective by the SEC on May 15, 2025. The Com pany also issued warrants to purchase up to an aggregate of 1,342,280 shares of Common Stock (“Common Stock Warrants”) for $ 7.45 per share. The Company sold the Common Stock and Pre-Funded Warrants with an accompanying two Common Stock Warrant, each of which may purchase one share of Common Stock, and the Common Stock and Pre-Funded Warrants were immediately separated from the Common Stock Warrants and issued separately. The combined purchase price for each Share and the two accompanying Common Stock Warrant was $ 7.45 per unit and the combined purchase price for each Pre-Funded Warrant and the two accompanying Common Stock Warrant was $ 7.4999 per unit. The Common Stock Warrants have an exercise price of $ 7.45 per share, are exercisable immediately, and expire on the five-year anniversary of the date of issuance. The Pre-Funded Warrants have an exercise price of $ 0.0001 per share, are exercisable immediately, and will not expire until exercised in full. The gross proceeds to the Company from the Offering were approximately $ 5.0 million before deducting the placement agent’s fees and other offering expenses of $ 802,602 payable by the Company. The Offering closed on May 15, 2025. In this financing, the Company issued shares of Common Stock of Pre-Funded Warrants that may be exercised to purchase Common Stock in lieu thereof, and warrants that may be exercised to purchase Common Stock. In a contemporaneous private agreement entered into with the Investor, the Company agreed to reprice warrants to purchase up to 167,925 shares of Common Stock that were issued to the Investor in a financing that closed on November 20, 2024 to an exercise price of $ 7.45 per share. The Company estimated the fair value of the securities issued, using the Black Scholes valuation model to estimate the fair value of the warrants, and determined the fair value of securities issued was $ 15.2 million. As this was a transaction with an existing stockholder, the Company recognized a $ 10.2 million deemed equity dividend to the Investor which was recorded in additional-paid-in capital for the period ended June 30, 2025. The Investor may not exercise any portion of the Common Stock Warrants or Pre-Funded Warrants to the extent it would beneficially own more than the limits defined in the respective Warrant Purchase Agreement. The exercise price and number of shares of Common Stock issuable upon the exercise of the Common Stock Warrants and Pre-Funded Warrants are subject to adjustment in the event of any stock dividends and distributions, stock splits, stock combinations or stock reclassifications, as described in the respective warrant agreements. Under certain circumstances, the warrants may be exercised on a “cashless” basis. 14 Both the Common Stock Warrants and Pre-Funded Warrants were classified as a component of permanent stockholders’ equity within additional paid-in-capital and were recorded at the issuance date. The Common Stock Warrants and Pre-Funded Warrants are equity classified because they are freestanding financial instruments that are legally detachable and separately exercisable from the equity instruments, are immediately exercisable, do not embody an obligation for the Company to repurchase its shares, permit the holders to receive a fixed number of shares of Common Stock upon exercise, are indexed to the Company’s Common Stock and meet the equity classification criteria. In addition, the Common Stock Warrants and the Pre-Funded Warrants do not provide any guarantee of value or return. As of June 30, 2025, the Investor exercised all of the Pre-Funded Warrants by delivering a notice of exercise to the Company and paying the exercise price. As a result, as of June 30, 2025, the Company issued 513,140 shares of registered Common Stock to the Investor. As of June 30, 2025, no ne of the Common Stock Warrants issued on May 15, 2025 had been exercised. November 2024 Equity Financing On November 18, 2024, the Company entered into a securities purchase agreement with the Investor for the issuance and sale of (i) 104,000 shares (the “Shares”) of the Company’s common stock, par value $ 0.0001 per share (the “Common Stock”) and (ii) pre-funded warrants to purchase up to 63,925 shares of Common Stock (the “Pre-Funded Warrants”) in a registered direct offering (the “Registered Offering”), pursuant to a shelf registration statement on Form S-3 (File No. 333-266991), which was declared effective by the SEC on August 26, 2022. The Registered Offering was made by means of a prospectus supplement filed with the SEC on November 20, 2024 that forms a part of such registration statement. In a concurrent private placement (the “Private Placement” and together with the Registered Offering, the Company also issued unregistered warrants to purchase up to an aggregate of 167,925 shares of Common Stock (“Common Stock Warrants”) for $ 41.20 per share. Share amounts and exercise price per share have been adjusted for the reverse stock split the Company effected on April 11, 2025. The Company sold the Common Stock and Pre-Funded Warrants with an accompanying Common Stock Warrant to purchase one share of Common Stock, and the Common Stock and Pre-Funded Warrants were immediately separated from the Common Stock Warrants and issued separately. The combined purchase price for each Share and accompanying Common Stock Warrant was $ 41.20 per unit and the combined purchase price for each Pre-Funded Warrant and accompanying Common Stock Warrant was $ 41.1999 per unit. The Common Stock Warrants have an exercise price of $ 41.20 per share, are exercisable immediately, and expire on the five-year anniversary of the date of issuance. The Pre-Funded Warrants have an exercise price of $ 0.0001 per share, are exercisable immediately, and will not expire until exercised in full. The gross proceeds to the Company from the offering were approximately $ 6.9 million before deducting the placement agent’s fees and other offering expenses of $ 638,045 payable by the Company. It closed on November 20, 2024. The Investor may not exercise any portion of the Common Stock Warrants or Pre-Funded Warrants to the extent it would beneficially own more than the limits defined in the respective Warrant Purchase Agreement. The exercise price and number of shares of Common Stock issuable upon the exercise of the Common Stock Warrants and Pre-Funded Warrants are subject to adjustment in the event of any stock dividends and distributions, stock splits, stock combinations or stock reclassifications, as described in the respective warrant agreements. Under certain circumstances, the warrants may be exercised on a “cashless” basis. Both the Common Stock Warrants and Pre-Funded Warrants were classified as a component of permanent stockholders’ equity within additional paid-in-capital and were recorded at the issuance date. The Common Stock Warrants and Pre-Funded Warrants are equity classified because they are freestanding financial instruments that are legally detachable and separately exercisable from the equity instruments, are immediately exercisable, do not embody an obligation for the Company to repurchase its shares, permit the holders to receive a fixed number of shares of Common Stock upon exercise, are indexed to the Company’s Common Stock and meet the equity classification criteria. In addition, the Common Stock Warrants and the Pre-Funded Warrants do not provide any guarantee of value or return. 15 On November 20, 2024, the Investor exercised all of the Pre-Funded Warrants by delivering a notice of exercise to the Company and paying the exercise price. The Company issued 63,925 registered shares of Common Stock to the Investor on November 21, 2024. On April 16, 2025, the 167,925 shares of Common Stock underlying the Common Stock Warrants issued on November 20, 2024 were registered in a registration statement filed pursuant to Rule 424(b)(3) (File No. 333-286409). On May 15, 2025, the Company entered into a privately negotiated agreement with the Investor for its Common Stock Warrants to reduce the exercise price of such warrants from $ 41.20 per share to $ 7.45 per share. The Company considered the change in fair value of this modification of the warrant as a deemed dividend to the Investor related to the equity offering that closed in May 2025 with the Investor. As of June 30, 2025, no ne of the Common Stock Warrants issued on November 20, 2024 and repriced on May 15, 2025 had been exercised. 5. Preferred Stock As of December 31, 2024 and June 30, 2025 , the Company had 10,000,000 shares of preferred stock authorized and no shares of preferred stock issued. 6. Net Loss Per Share The following table summarizes the computation of the basic and diluted net loss per share: Three Months Ended June 30, Six Months Ended June 30, 2024 2025 2024 2025 Numerator: Net loss $ ( 15,280,191 ) $ ( 1,927,730 ) $ ( 22,748,253 ) $ ( 4,124,606 ) Equity dividend to investor - ( 10,153,799 ) - ( 10,153,799 ) Net loss attributable to Common Stockholders $ ( 15,280,191 ) $ ( 12,081,529 ) $ ( 22,748,253 ) $ ( 14,278,405 ) Denominator: Weighted-average common shares outstanding, basic and diluted 945,585 1,780,113 938,087 1,448,502 Net loss per share, basic and diluted $ ( 16.16 ) $ ( 6.79 ) $ ( 24.25 ) $ ( 9.86 ) The following table summarizes the outstanding potentially dilutive securities. At June 30, 2024 and 2025, these securities were excluded in the calculation of diluted net loss per share because their inclusion would be anti-dilutive: June 30, 2024 2025 Common stock options 44,902 44,347 Common stock warrants — 1,636,745 Potentially dilutive securities 44,902 1,681,092 16 7. Standby Equity Purchase Agreement On February 20, 2025 , the Company entered into an Equity Purchase Agreement (the “Equity Purchase Agreement”) with Square Gate Capital Master Fund, LLC - Series 4 (“Square Gate”), which the Company deemed to be a Standby Equity Purchase Agreement (“SEPA”). Under the Equity Purchase Agreement, the Company will have the right, but not the obligation, to sell to Square Gate, and Square Gate will have the obligation to purchase from the Company, up to $ 20,000,000 (the “Maximum Commitment Amount”) worth of the Company’s shares of common stock, at the Company’s sole discretion, over the next 36 months (the “Put Shares”), subject to certain conditions precedent and other limitations. Square Gate has covenanted not to cause or engage in any short sales or hedging transactions with respect to the shares of the Company’s common stock. The Maxim Group LLC acted as the Company’s exclusive Placement Agent in connection with this transaction. Unless earlier terminated, the Equity Purchase Agreement will remain in effect until the earlier of February 18, 2028 ( i.e ., the expiry of the 36 -month period commencing on the date of the Equity Purchase Agreement) or the date on which Square Gate has purchased the Maximum Commitment Amount (the “Commitment Period”). The Company has the right to terminate the Equity Purchase Agreement at any time, subject to certain provisions as set forth in the Equity Purchase Agreement. Square Gate has the right to terminate the Equity Purchase Agreement under certain provisions as set forth in the Equity Purchase Agreement, including the continued listing of the Company's common stock on an Eligible Market. During the Commitment Period, the Company will have the right, but not the obligation, to direct Square Gate to make a purchase of the Put Shares by delivering written notice (a “Put Notice”) to Square Gate on any trading day (the “Put Date”) to purchase a number of Put Shares pursuant to a formula set forth in the Equity Purchase Agreement. The number of Put Shares that the Company can issue to Square Gate from time to time under the Equity Purchase Agreement may not exceed 4.99 % of the number of shares of our common stock outstanding immediately after giving effect to the issuance of shares issuable pursuant to a Put Notice. The per share purchase price for the Put Shares that we elect to sell to Square Gate in a Put Notice pursuant to the Equity Purchase Agreement will be equal to 98 % of the lowest daily VWAP during the Valuation Period (as defined in the Equity Purchase Agreement), in the case of a Valuation Period ending on the date that is at the end of the third trading day immediately following the applicable Put Date. The Company also agreed to a $ 150,000 commitment fee (the “Commitment Fee”), which shall be in the form of shares of Common Stock to be issued to Square Gate in accordance with the terms of the Equity Purchase Agreement. The Equity Purchase Agreement and Registration Rights Agreement contain customary representations, warranties and agreements by the Company and customary conditions to Square Gate’s obligation to purchase the Put Shares. Actual sales of shares of our common stock, if any, to Square Gate under the Equity Purchase Agreement will depend on a variety of factors to be determined by the Company from time to time, including, among others, market conditions, the trading price of the Company’s common stock and determinations by the Company as to the appropriate sources of funding for the Company and its operations. The net proceeds to us from sales of our common stock to Square Gate under the Equity Purchase Agreement, if any, will depend on the frequency and prices at which the Company sells shares to Square Gate under the Equity Purchase Agreement. Any proceeds that the Company receives from sales of shares of our common stock to Square Gate under the Equity Purchase Agreement will be used to advance our clinical development programs and expand our discovery, research and preclinical activities in the near term and in the future. On March 12, 2025, the Company issued 9,616 shares of the Company’s Common Stock (subject to adjustment for the Reverse Stock Split) to Square Gate in payment of the Commitment Fee (“Commitment Shares”). At the Special Meeting of Stockholders, stockholders approved the Company’s use of the Equity Purchase Agreement. On April 16, 2025, the U.S. Securities and Exchange Commission (“SEC”) declared a registration statement effective to register the Commitment Shares and shares required to sell up to $ 40.0 million of the Company’s shares to Square Gate, according to provisions of the Equity Purchase Agreement. The Company concluded that the Equity Purchase Agreement does not qualify for equity classification. On the effective date, the Company concluded that the fair value of the Equity Purchase Agreement at inception was zero and no asset or liability was recorded. As a result, fees paid to Square Gate in excess of the fair value of the Equity Purchase Agreement were expensed as incurred. Any issuance costs or other transaction costs attributable to a freestanding equity-linked financial instrument that is classified as an asset or liability should be recognized in earnings in the period incurred. The Commitment Fee was expensed as of March 31, 2025. The issuance costs were expensed as of June 30, 2025. 17 When the Company wishes to draw on the Equity Purchase Agreement, the Company submits a put order to Square Gate on Day 0, issues the shares on Day 1, and the pricing of the transaction is determined from Day 1 – 3 trading days, with the price to be paid by Square Gate fixed by using the minimum trading price in one of the three trading days after the put order is accepted. Square Gate is required to pay for the Put Shares under the terms of the Equity Purchase Agreement by Day 5. When there is a lag between the pricing of the shares and the issuance of the shares, the Company will account for the sale as a forward contract and the issuance as a settlement of the forward contract. The fair value of the Equity Purchase Agreement is zero since inception. In the three months ended June 30, 2025, the Company expensed $ 48,608 of issuance costs incurred during the period, which are reported within General and administrative expenses in the accompanying condensed interim statements of operations. In the six months ended June 30, 2025, the Company expensed the $ 150,000 Commitment Fee which was incurred in the period ended March 31, 2025 and $ 148,608 of issuance costs which were incurred in the period ended June 30, 2025. No draws were made under the Equity Purchase Agreement as of June 30, 2025. Subsequent to June 30, 2025, the Company made draws on the Equity Purchase Agreement and the Equity Purchase Agreement was amended by mutual agreement to allow for intraday trading. See Note 12. Subsequent Events. 8. Fair Value of Financial Instruments The carrying amount of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, U.S. government-backed securities with maturity dates up to one year, accounts payable and accrued liabilities, approximate fair value due to their short-term maturities. Money market funds included in cash and cash equivalents and U.S. government-backed securities are measured at fair value based on quoted prices in active markets, which are considered Level 1 inputs. The investments and contingent liability included in the balance sheet are measured at fair value based on the adjusted enterprise value method, which is considered Level 3 inputs. N o transfers between levels occurred during the periods presented. The following table presents the Company’s assets and liabilities which were measured at fair value at December 31, 2024 and June 30, 2025: December 31, 2024 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 3,748,325 $ — $ — $ 3,748,325 Total $ 3,748,325 $ — $ — $ 3,748,325 June 30, 2025 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 2,124,762 $ — $ — $ 2,124,762 Investments — — 3,348,438 3,348,438 Liabilities Contingent Liability — — ( 1,748,356 ) ( 1,748,356 ) Total $ 2,124,762 $ — $ 1,600,082 $ 3,724,844 9. Income Taxes For the three and six months ended June 30, 2025, The Company computes its quarterly income tax expense/(benefit) by using a forecasted annual effective tax rate and adjusts for any discrete items arising during the quarter. The Company did not have a provision for income taxes (current or deferred tax expense) as of December 31, 2024 and June 30, 2025. The Company will continue to maintain a 100% valuation allowance on total deferred tax assets. The Company believes it is more likely than not that the related deferred tax assets will not be realized. As a result, the Company’s effective tax rate will remain at 0.00% because no items either estimated or discrete items would impact the tax provision. See Note 12. Subsequent Events for information on the recent One Big Beautiful Bill Act and the potential impacts thereof. 10. Segment Reporting 18 HCW Biologics, Inc. has one reportable segment: life science. The life science segment consists of operations focused on discovering and developing novel immunotherapies to lengthen health span by disrupting the link between chronic, low-grade inflammation and diseases. The Company’s CODM is the Chief Executive Officer . The accounting policies of the life science segment are the same as those described in the summary of significant accounting policies. The CODM assesses performance for the life science segment based on net loss, which is reported on the statement of operations as net loss. The measure of segment assets is reported on the balance sheet as total assets. The Company has not generated any product revenue from commercial product sales of internally-developed immunotherapeutic products for the treatment of diseases, as no products have been approved for commercial sale as of June 30, 2025. The Company expects to continue to incur significant expenses and operating losses for the foreseeable future as it advances molecules through all stages of development and clinical trials and, ultimately, seek approval for commercial sale. As such, the CODM uses cash forecast models in deciding how to invest into the life science segment. Such cash forecast models are reviewed to assess the entity-wide operating results and performance in conjunction with monitoring the results of R&D experiments for preclinical compounds and clinical trial data for clinical-stage compounds. The assessment of results of preclinical and clinical studies are critical to the allocation of resources by the CODM. There were no material changes to the measures for segment revenue, profit or loss, and other metrics since March 31, 2025. The tables below summarize the significant expense categories regularly reviewed by the CODM for the three and six months ended June 30, 2024 and June 30, 2025: Three Months Ended June 30, Six Months Ended June 30, 2024 2025 2024 2025 Revenues: Revenues $ 618,854 $ 6,550 $ 1,745,566 $ 11,615 Cost of revenues ( 438,443 ) ( 5,240 ) ( 950,408 ) ( 9,292 ) Net revenues 180,411 1,310 795,158 2,323 Operating expenses: Research and development expenses Salaries, benefits and related expenses 756,646 778,440 1,536,393 1,479,546 Manufacturing and materials 751,770 33,986 1,328,072 296,783 Preclinical expenses 258,476 146,948 543,568 324,060 Clinical trials 65,120 110,935 331,757 298,755 Overhead allocations 197,174 156,515 412,680 306,392 Total research and development expenses 2,029,186 1,226,824 4,152,470 2,705,536 General and administrative Salaries, benefits and related expenses 714,974 765,539 1,236,585 1,554,026 Professional services (a) 229,963 496,641 583,769 951,008 Facilities and office expenses 204,715 111,740 408,314 206,068 Depreciation expenses 66,615 59,160 133,694 120,398 Rent and occupancy expenses 63,992 62,528 106,708 112,278 Insurance 192,680 270,598 365,951 560,866 Taxes 62,045 61,576 96,200 94,168 Other expenses 59,209 165,991 229,064 328,181 Total general and administrative expenses 1,594,193 1,993,773 3,160,285 3,926,993 Other segment items (b) 11,837,223 ( 1,291,557 ) 16,230,656 ( 2,505,600 ) Total operating expenses 15,460,602 1,929,040 23,543,411 4,126,929 Net segment loss $ ( 15,280,191 ) $ ( 1,927,730 ) $ ( 22,748,253 ) $ ( 4,124,606 ) (a) Professional services consist primarily of audit and accounting advisory services, tax advisory services, corporate legal services and other services related to SEC compliance, and legal fees related to patent filings. (b) Other segment items include the following unusual or nonrecurring item that comprise other segment items for the three and six months ended June 30, 2024 and 2025: 19 Three Months Ended June 30, Six Months Ended June 30, 2024 2025 2024 2025 Arbitration legal fees (recoveries), net $ 10,393,042 $ 142,542 $ 14,812,076 $ ( 1,596,951 ) Accretion of fixed bonus upon maturity of Secured Notes — 102,248 — 375,308 Interest expense 159,666 228,714 159,666 505,853 Unrealized gain on investment — ( 1,748,688 ) — ( 1,748,688 ) Nonoperating loss 1,300,000 — 1,300,000 — Other income, net ( 15,485 ) ( 16,373 ) ( 41,086 ) ( 41,122 ) Other segment items $ 11,837,223 $ ( 1,291,557 ) $ 16,230,656 $ ( 2,505,600 ) 11. Commitments and Contingencies Operating Leases The Company has operating leases for approximately 12,250 square feet of space located in Miramar, Florida. On February 29, 2024, the lease on the Company's current location reached the end of its term and the Company entered a new one-year lease for the same location which commenced on March 1, 2024 and terminated on February 28, 2025 . On January 27, 2025, the Company entered a new one-year lease for the same location which commenced on March 1, 2025 and terminates on February 28, 2026 . As a lease of 12 months or less in duration and qualifies for a short-term lease exemption under ASC 842-20-25-2, the Company elected to account for this lease on a straight-line basis over the lease term and will not recognize a ROU asset and a lease liability as a result. The Company has no obligations under financing leases. For the three months ended June 30, 2024 and 2025 , rent expense recognized by the Company was $ 49,524 and $ 52,619 respectively, of which $ 25,936 and $ 27,557 , respectively, are included in research and development in the accompanying condensed interim statements of operations. For the six months ended June 30, 2024 and 2025, rent expense recognized by the Company was $ 96,907 and $ 103,175 respectively, of which $ 48,389 and $ 54,033 , respectively are included in research and development in the accompanying condensed interim statements of operations. Contractual Commitments The Company has commitments with a third-party manufacturing organization to supply us with clinical grade materials. As of June 30, 2025, it is under contract for obligatio ns of $ 34,200 it expects to pay during the year ending December 31, 2025. On January 22, 2025, the Company entered into a forbearance agreement with BE&K to allow the Company until March 31, 2025 to continue efforts to find the financing required to complete the construction and renovation of the building. Pursuant to the forbearance agreement, the Company made an initial payment of $ 1.0 million in partial satisfaction of amounts owing to BE&K and its subcontractors. Upon the expiration of the forbearance agreement, BE&K took additional legal actions. See Legal - Other Matters below. The Company has continued to pursue financing alternatives to provide the funding needed to come current in past amounts due and complete the construction and renovation of the property. Company Victim to Fraudulent Criminal Scheme As reported in the Company’s Form 8-K filed on May 1, 2024 with the SEC, the Company became aware that it was the victim of a criminal scheme involving the impersonation of a purchaser upon the default (the “Default”) on a legally binding commitment to purchase $ 8.0 million of secured notes from the Company. The scheme resulted in the misdirection of approximately $ 1.3 million held in Company accounts to a fraudulent account controlled by a third party. The Company recognized a $ 1.3 million loss reported as a Nonoperating loss in the accompanying condensed interim statements of operations. The Company has pursued all available remedies to recover this loss, including reporting it to law enforcement. 20 Legal Legal Proceedings From time to time, the Company is a party to or otherwise involved in legal proceedings, including suits, assessments, regulatory actions and investigations generally arising out of the normal course of business. In addition, the Company enters into agreements that may include indemnification provisions, pursuant to which the Company agrees to indemnify, hold harmless and defend the indemnified parties for losses suffered or incurred by the indemnified party. When the Company believes that the outcome of such a matter will result in a liability that is probable to be incurred and result in a potential loss, or range of loss, that can be reasonably estimated, the Company will accrue a liability and make the appropriate disclosure in the footnotes to the financial statements. Arbitration, Settlement and General Release On December 23, 2022, Altor BioScience, LLC and NantCell, Inc. (collectively “ImmunityBio”) initiated an arbitration against Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer, in California alleging breach of contract and fiduciary duty, among other claims. On that same date, ImmunityBio filed a lawsuit against the Company in federal court alleging misappropriation of trade secrets, inducement of breach of contract and breach of fiduciary duty, among other claims against the Company. On April 26, 2023, the parties stipulated that ImmunityBio’s action against the Company would be consolidated with the ImmunityBio Arbitration demand against Dr. Wong. On April 27, 2023, the Court approved the parties’ stipulation and ordered the parties to Arbitration. On May 1, 2023, ImmunityBio filed a demand against the Company before JAMS. On May 3, 2023, ImmunityBio dismissed the federal court action without prejudice and the Court ordered the case dismissed without prejudice and closed the case. ImmunityBio’s proceeding against the Company proceeded in Arbitration before JAMS and consolidated with the arbitration ImmunityBio initiated against Dr. Wong (the “Arbitration”). On March 26, 2024, ImmunityBio filed a complaint (the “Complaint”) against the Company in the Chancery Court of the State of Delaware for the contribution of legal fees and expenses advanced to Dr. Wong. As reported in the Company’s Form 8-K filed on July 18, 2024 and described in Part II, Item 1. – “Legal Proceedings,” as of July 13, 2024, the Company and Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer, entered into a confidential Settlement Agreement and Release (the “Settlement Agreement”) with Altor BioScience, LLC (“Altor”), NantCell, Inc. (“NantCell”), and ImmunityBio, Inc. (the parent of Altor and NantCell, together with Altor and NantCell, “ImmunityBio”), to resolve the previously disclosed Arbitration before JAMS brought by Altor and NantCell as well as the Complaint Altor filed against the Company in the Chancery Court of the State of Delaware for the contribution of legal fees and expenses advanced to Dr. Wong. The Settlement Agreement includes mutual general releases by and among the parties thereto. No party is required to make any monetary payments to any other party or person under the Settlement Agreement and each party will bear its own expenses incurred in connection with the matter. The Arbitration and the Complaint were dismissed as of December 31, 2024. Other Matters As the Company reported in a Form 8-K, on April 17, 2025, the Company received a summons and a copy of a complaint filed by BE&K in the Circuit Court of the 17th Judicial Circuit in and for Broward County, Florida (the “BE&K Complaint”). Other Defendants named in the BE&K Complaint who are subcontractors elected to filed counterclaims and cross-claims in response to the BE&K Complaint. Cogent Bank, also named as a Defendant in the BE&K Complaint, has not elected to take legal action at this time. In addition, on April 28, 2025, the Company received a summons and a copy of a complaint filed by Fisk Electric Company (which is a defendant in the BE&K Complaint) in the Circuit Court of the 17th Judicial Circuit in and for Broward County, Florida (the “Fisk Complaint”) against the Company, BE&K, and the other defendants in the BE&K Litigation. On August 8, 2025, B&I Contractors, Inc., one of the defendants in the BE&K Complaint, filed a motion for summary judgment (the “MSJ”) as to the Count I (Foreclosure of Construction Lien). The Company has responded to the BE&K and Fisk Complaints and cross-claims and intends to file a timely response to the B&I MSJ. 21 Inflationary Cost Environment, Banking Crisis, Supply Chain Disruption and the Macroeconomic Environment The Company’s operations have been affected by many headwinds, including inflationary pressures, including those brought about by tariffs and other economic policies, high interest rates, ongoing global supply chain disruptions resulting from increased geopolitical tensions such as the war in the Middle East, the conflict between Russia and Ukraine, China-Taiwan relations as well as U.S. trade policies, financial market volatility and currency movements. The Company has been impacted by inflation, and may continue to be so, when procuring materials required for the buildout of our new manufacturing and laboratory facilities, the costs for recruiting and retaining employees and other employee-related costs. Management employs a number of strategies to effectively navigate these issues, including product redesign, alternate sourcing, and establishing contingencies in budgeting and timelines. Future developments in these and other areas present material uncertainty and risk with respect to the Company's clinical trials, IND-enabling activities, buildout of the new manufacturing and laboratory facilities, as well as the Company's financial condition and results of operations. The extent and duration of such events and conditions, and resulting disruptions to our operations, are highly unpredicta ble. 12. Subsequent Events Subsequent events have been evaluated through the date the financial statements were filed. In addition to the required recognition or disclosure disclosed in the footnotes herein, there were also the following subsequent events after the reporting date: On July 4, 2025, following the end of the second quarter, the One Big Beautiful Bill Act was enacted into law in the United States. This legislation includes various tax provisions that may affect U.S. corporate taxpayers, including changes to the deductibility of interest expense, the treatment of research and development costs, and depreciation of certain property, among other items. The Company is currently assessing the potential impact of this new legislation on its annual income tax expense, deferred tax assets and liabilities, valuation allowances, and projected cash flows. Based on its preliminary analysis, the Company does not expect the legislation to have a material effect on its financial statements. On July 22, 2025, the Company submitted a Put Notice to Square Gate for 5,000 shares to be sold under the terms of the Equity Purchase Agreement, which was settled on July 25, 2025 for $ 19,803 , net of transaction fees. On August 8, 2025, B&I Contractors, Inc., one of the defendants in the BE&K Complaint, filed a motion for summary judgment (the “MSJ”) as to the Count I (Foreclosure of Construction Lien). On August 14, 2025, the Company entered into the First Amendment to the Equity Purchase Agreement between HCW Biologics Inc., and Square Gate Capital Master Fund, LLC – Series 4, a series limited liability company organized in the State of Delaware (the “Square Gate”). The amended agreement provides an alternative process for the issuance of put notices to Square Gate, allowing intraday trading. On August 15, 2025, the Company filed a “Notification of Late Filing” to allow the Company to extend the deadline for filing its Quarterly Report on Form 10-Q. 22