What changed in this filing

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Item 9A. Controls and Procedures

2026-03-30 compared with 2025-03-28 · 117 added, 131 removed, 735 unchanged (25% of the section changed)

22 unchanged sentences

Changes in Internal Control Over Financial Reporting

There were no changes in our internal controls during the year ended December 31, 2024, that materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

There were no changes in our internal controls during the quarter ended December 31, 2025, that materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

OTHER INFORMATION

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DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this Item regarding our directors is incorporated by reference to the information in our definitive Proxy Statement (the “Proxy Statement”) expected to be filed with the Securities and Exchange Commission within 120 days of December 31, 2024, in connection with our 2024 Annual Meeting of Stockholders under the heading “Election of Directors.” The information required by this Item regarding our Code of Conduct and Ethics in incorporated by reference to the information in the Proxy Statement, expected to be filed within 120 days of December 31, 2024, under the caption “Code of Conduct and Ethics.” The information required by this Item regarding our Governance Committee and Audit Committee is incorporated by reference to the information in the Proxy Statement, expected to be filed within 120 days of December 31, 2024, under the caption “Corporate Governance.”

The information required by this Item regarding our directors is incorporated by reference to the information in our definitive Proxy Statement (the “Proxy Statement”) expected to be filed with the Securities and Exchange Commission within 120 days of December 31, 2025, in connection with our 2026 Annual Meeting of Stockholders under the heading “Election of Directors.” The information required by this Item regarding our Code of Conduct and Ethics is incorporated by reference to the information in the Proxy Statement, expected to be filed within 120 days of December 31, 2025, under the caption “Code of Conduct and Ethics.” The information required by this Item regarding our Governance Committee and Audit Committee is incorporated by reference to the information in the Proxy Statement, expected to be filed within 120 days of December 31, 2025, under the caption “Corporate Governance.”

At December 31, 2025, our executive officers were as follows:

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Co-Tenant Agreement dated December 15, 2021 (incorporated by reference to Exhibit 10.14 of the Registrant’s Form 10-K filed on March 29, 2022).

Form of Note issued on March 1, 2023 (incorporated by reference to Exhibit 10.1 of Registrant’s Form 8-K filed on March 16, 2023).

Form of Note issued on September 15, 2025 (incorporated by reference to Exhibit 10.1 of Registrant’s Form 8-K filed on September 16, 2025).

Form of Note issued on September 15, 2024 (incorporated by reference to Exhibit 10.1 of Registrant’s Form 8-K filed on September 17, 2024).

Co-Tenant Agreement Amendment, dated February 25, 2025, by and between International Stem Cell Corporation and S Real Estate Holdings, LLC (incorporated by reference to Exhibit 10.1 of Registrant’s Form 10-Q filed on May 14, 2025).

Insider Trading Compliance Program

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Other income (expense):

Employee retention credit

Interest expense

Interest expense - related party

Other income, net

Total other (expense) income, net

Other expense, net

Net loss per common share, basic and diluted

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Prepaid expenses and other current assets

Deposits and other assets

Accounts payable

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Net cash used in financing activities

Net (decrease) increase in cash

Net decrease in cash

Cash, beginning of period

Cash, end of period

Supplemental disclosure of non-cash operating activities:

Operating lease right-of-use asset obtained in exchange for operating lease liabilities

Supplemental disclosure of cash flow information:

Cash paid for interest

Supplemental disclosure of non-cash investing activities:

Patent license costs included in accounts payable and accrued expense

See accompanying notes to consolidated financial statements.

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The Company has the following wholly owned subsidiaries:

• Lifeline Cell Technology, LLC (“LCT”) – for the biomedical market, develops, manufactures and commercializes primary human cell research products including over 200 human cell culture products, including frozen human “primary” cells and the reagents (called “media”) needed to grow, maintain and differentiate the cells;

• Lifeline Cell Technology, LLC (“LCT”) – develops, manufactures, and commercializes primary human cell research products for the biomedical market, including human cell culture products such as frozen human “primary” cells and the reagents (called “media”) needed to grow, maintain, and differentiate the cells;

• Lifeline Skin Care, Inc.

(“LSC”) – for the anti-aging market, develops, manufactures and markets a category of anti-aging skin care products based on the Company’s proprietary parthenogenetic stem cell technology and small molecule technology;

(“LSC”) – develops, manufactures, and markets a category of anti-aging skin care products for the anti-aging market based on the Company’s proprietary parthenogenetic stem cell technology and small molecule technology;

• Cyto Therapeutics Pty.

(“Cyto Therapeutics”) – performs research and development (“R&D”) for the therapeutic market and is currently conducting clinical trials in Australia for the use of ISC-hpNSC® in the treatment of Parkinson’s disease.

(“Cyto Therapeutics”) – performs research and development (“R&D”) for the therapeutic market and is currently conducting a clinical trial in Australia for the use of ISC-hpNSC® in the treatment of Parkinson’s disease.

Going Concern

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LCT’s inventories have a long product life cycle, do not have a shelf life when frozen, and future demand is uncertain.

As such, at each reporting period, the Company estimates its reserve for allowance for excess and obsolete inventory using historical sales data and inventory turnover rates.

The establishment of a reserve for excess and obsolete inventory establishes a new cost basis of inventories.

As such, at each reporting period, the Company estimates its reserve allowance for excess and obsolete inventories using historical sales data and inventory turnover rates.

The establishment of a reserve for excess and obsolete inventories establishes a new cost basis of inventories, and charges are not reversed subsequently to income, even if circumstances later suggest that increased carrying amounts are recoverable .

If the Company is able to sell such inventories, any related reserves would be reduced in the period of sale.

The value of inventories that are not expected to be sold within one year of the current reporting period is classified as non-current inventories on the accompanying consolidated balance sheets.

Accounts Receivable

Trade accounts receivable is recorded at the net invoice value and are not interest bearing.

Accounts Receivable, net

Trade accounts receivable are recorded at the net invoice value and are not interest bearing.

Accounts receivable primarily consist of trade accounts receivable from the sales of LCT’s products, timing of cash receipts by the Company related to LSC credit card sales to customers, as well as LSC trade receivable amounts related to spa and distributor sales.

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For the years ended December 31, 2025 and 2024 , no revenues were realized and attributable to BioTime under this agreement.

Property and Equipment

Property and Equipment, net

Property and equipment are stated at cost.

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Leasehold improvements are capitalized and amortized over the shorter of the remaining term of the lease or the estimated life of the assets.

Intangible Assets

Intangible Assets, net

Intangible assets consist of acquired patent licenses and capitalized legal fees related to the acquisition, filing, maintenance, and defense of patents and trademarks.

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Variable Consideration

The Company records revenue from customers in an amount that reflects the transaction price it expects to be entitled to after transferring control of those goods or services to the customer.

The Company records revenue from customers in an amount that reflects the consideration it expects to be entitled to after transferring control of those goods or services to the customer.

From time to time, the Company offers sales promotions on its LSC products, such as discounts and free product offers.

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The Company generally expenses sales commissions when incurred because the amortization period would be one year or less.

These costs are recorded as selling and marketing expenses within the accompanying consolidated statement of operations.

These costs are recorded as selling and marketing expenses within the accompanying consolidated statements of operations.

In addition, the Company has elected to exclude sales taxes consideration from the determined transaction price.

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however, the Company determined that there is a low probability that returns will occur based on its historical rate of returns.

Historically, returns have not been significant and are recognized as a reduction to curre nt period revenue.

Historically, returns have not been material and are recognized as a reduction to curre nt period revenue.

At December 31, 2025 and 2024 , the Company recorded no allowance for sales returns.

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Additionally, milestone payments or the amortization of license fees related to developed technologies used in the Company’s products will be included as a component of cost of sales to the extent that such payments become due in the future.

Adverting costs are expensed as incurred and included as a component of selling and marketing expenses in the accompanying consolidated statements of operations.

Advertising costs are expensed as incurred and included as a component of selling and marketing expenses in the accompanying consolidated statements of operations.

For the years ended December 31, 2025 and 2024, advertising costs were approximately $ 102 thousand and $ 179 thousand, respectively.

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The Company recognizes the research and development tax credit as a reduction to research and development expense when there is reasonable assurance that the tax credit will be received, the relevant expenses have been incurred, and the amount can be reliably measured.

During the year ended December 31, 2024 and 2023, the Company recognized a reduction in qualified research and development expenses of $ 94 thousand and $ 99 thousand, respectively, in the accompanying consolidated statement of operations.

Employee Retention Credit

Similar to the Australian research and development tax credit, the Company uses the grant accounting model by analogy to IAS 20 to account for the refundable Employee Retention Tax Credit (“ERC”) from the U.S.

The Company recognized the refundable tax credit as other income when there was reasonable assurance that the tax credit will be received, the relevant expenses have been incurred, and the amount can be reliably measured.

Laws and regulations concerning government programs, including the ERC, are complex and subject to varying interpretations.

Claims made under these programs may also be subject to retroactive audit and review.

While the Company does not believe there is a basis for estimation of an audit or recapture risk at this time, there can be no assurance that regulatory authorities will not challenge the Company’s claim to the ERC in a future period.

Refer to Note 8 – Employee Retention Credit within the consolidated financial statements for further discussion.

During the year ended December 31, 2025 and 2024, the Company recognized a reduction in qualified research and development expenses of $ 52 thousand and $ 94 thousand, respectively, in the accompanying consolidated statements of operations.

Stock-Based Compensation

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The fair value of stock options is estimated using the Black-Scholes option valuation model, which requires the input of subjective assumptions, including price volatility of the underlying stock, risk-free interest rate, dividend yield, and expected life of the option.

The Company uses the simplified method to estimate the term of options granted.

The expected term of stock options is estimated using the simplified method as the Company has limited historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior for its stock option grants.

The fair value of restricted stock awards is based on the market value of the Company’s common stock on the date of grant.

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The carrying value of the Company’s related party note payable does not approximate fair value.

Refer to Note 10 – Related Party Transactions within the consolidated financial statements for further discussion.

Refer to Note 9 – Related Party Transactions for further discussion.

The Company uses the asset and liability method of accounting for income taxes.

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No other single customer accounted for more than 10% of product sales, net for the years ended December 31, 2025 and 2024 in either segment.

At December 31, 2025 two customers of LCT (inclusive of the aforementioned customer) individually accounted for more than 10% of accounts receivable, net and in the aggregate accounted for 64 % of accounts receivable, net.

No other single customer accounted for more than 10% of accounts receivable, net at December 31, 2024 .

At December 31, 2023 , three customers of LCT individually accounted for more than 10% of accounts receivable, net and in the aggregate, accounted for 33 % of accounts receivable, net.

Cash Concentrations

The Company maintains cash balances at various financial institutions.

Accounts at these institutions are secured up to $ 250 thousand by the Federal Deposit Insurance Corporation (“FDIC”).

At times, cash balances may exceed this limit.

As of December 31, 2024 and 2023, amounts on deposit in excess of FDIC insured limits approximated $ 327 thousand and $ 543 thousand, respectively.

The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash.

The Company maintains deposits in federally insured financial institutions in excess of federally insured limits.

The Company has not experienced any losses in such accounts, and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held.

Recently Issued Accounting Pronouncements

In December 2023, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosure (“ASU 2023-09”).

ASU 2023-09 intends to provide improved transparency about income tax information through improvements to income tax disclosures.

Among other things, the amendments in ASU 2023-09 require enhanced disclosures regarding federal, state, and foreign income taxes primarily related to the income tax rate reconciliation and income taxes paid.

Further, the amendments eliminate certain disclosure requirements related to uncertain tax positions and unrecognized deferred tax liabilities.

The new standard will be effective for the Company for the fiscal year ending December 31, 2025.

The Company is currently evaluating the potential impact that this standard may have on its consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU No.

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Recently Adopted Accounting Pronouncements

In August 2020, the FASB issued ASU No.

2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”).

ASU 2020-06 intends to simplify the accounting for convertible debt instruments by reducing the number of accounting models and the number of embedded features that could be recognized separately from the host contract.

Among other things, the amendment allows certain convertible debt instruments to be accounted for as a single liability measured at its amortized cost, as long as no other features require bifurcation and recognition as derivatives.

Further, the amendments require use of the if-converted method in the diluted earnings per share calculation for convertible instruments.

The Company adopted ASC 2020-06 on January 1, 2024 .

The adoption of this standard did no t have a material impact on the Company’s consolidated financial statements.

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosure s (“ASU 2023-07”).

ASU 2023-07 intends to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

Among other things, the amendments in ASU 2023-07 require additional information regarding significant segment expenses provided to the chief operating decision maker (“ CODM”), qualitative and quantitative disclosures regarding other segment items, any additional segment profit or loss measures contemplated by the CODM when assessing segment performance, how the CODM allocates resources among segments, and the title and position of the CODM.

Further, the amendments require interim segment reporting disclosures that were previously only required to be disclosed annually.

ASU 2023-07 is effective for the Company for the fiscal year ending December 31, 2024 and for interim periods beginning January 1, 2025.

The adoption of this standard for the year ended December 31, 2024 did no t have a material impact on the Company’s consolidated financial results, but resulted in enhanced disclosures as included in Note 12 – Segments and Geographic Information .

In December 2023, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosure (“ASU 2023-09 ”).

ASU 2023-09 intends to provide improved transparency about income tax information through improvements to income tax disclosures.

Further, the amendments eliminate certain disclosure requirements related to uncertain tax positions and unrecognized deferred tax liabilities.

The new standard is effective for the Company for the fiscal year ending December 31, 2025.

The adoption of this standard on a retrospective basis for the years ended December 31, 2025 and December 31, 2024 did no t have a material impact on the Company’s consolidated financial results, but resulted in enhanced disclosures as included in Note 8 – Income Taxes .

The components of inventories are as follows (in thousands):

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Balance, end of year

W rite-offs of inventories include scrapped inventories and reserved inventories sold.

Property and Equipment

Property and equipment consist of the following (in thousands):

Write-offs of inventories include scrapped inventories and reserved inventories sold.

Property and Equipment, net

Property and equipment, net consist of the following (in thousands):

Machinery and equipment

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Property and equipment, net

Depreciation and amortization expense for the years ended December 31, 2024 and 2023 was $ 124 thousand and $ 112 thousand.

Depreciation and amortization expense for the years ended December 31, 2025 and 2024 was $ 139 thousand and $ 124 thousand, respectively.

During the year ended December 31, 2025 and 2024, the Company disposed of approximately $ 12 thousand and $ 123 thousand, respectively, in property and equipment that had been depreciated and amortized in full and had no impact to t he accompanying consolidated statements of operations.

Intangible Assets

Intangible assets consist of the following (in thousands):

Intangible Assets, net

Intangible assets, net consist of the following (in thousands):

accumulated amortization

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Amortization expense for the years ended December 31, 2025 and 2024 was $ 80 thousand and $ 82 thousand, respectively.

Impairment charges for the years ended December 31, 2024 and 2023 was $ 2 thousand and zero , respectively.

Impairment charges for the years ended December 31, 2025 and 2024 were immaterial.

The impairment charges, measured on a cost basis, relate to the abandonment of certain internally generated and licensed intellectual property in the Company’s therapeutic market segment that was determined by management to have no future economic benefit.

During the year ended December 31, 2025, the Company retired three expired patents which had a total cost basis of $ 62 thousand and were amortized in full at the time of expiration.

Accordingly, there was no impact to the accompanying consolidated statements of operations as a result of these retirements.

There were no patent expirations or related retirements recorded during the year ended December 31, 2024.

The timing of approval of pending patent applications is uncertain and, therefore, are included in the thereafter period below until issued.

Pending patents at December 31, 2024 and 2023 was $ 64 thousand and $ 61 thousand, respectively.

Pending patents at December 31, 2025 and 2024 were $ 67 thousand and $ 64 thousand, respectively.

At December 31, 2025, future amortization expense related to intangible assets subject to amortization is expected to be as follows (in thousands):

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Accordingly, on November 6, 2023, the 2010 Plan Amendment became effective.

For the year ended December 31, 2024 and 2023 , there were no restricted stock units granted.

For the years ended December 31, 2025 and 2024 , there were no restricted stock units granted.

At December 31, 2025 , there were no restricted stock units outstanding.

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Outstanding at December 31, 2024

Forfeited or cancelled

Outstanding at December 31, 2025

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Unrecognized compensation expense related to stock options at December 31, 2025 was $ 141 thousand, which is expected to be recognized over a weighted-average period of approximately 0.63 years.

Employee Retention Credit

Other income is primarily attributable to the one-time receipt of the Employee Retention Tax Credit from the Internal Revenue Service (the “IRS”).

As a response to the COVID-19 outbreak, the U.S.

government enacted the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), which contained a number of programs to assist workers, families and businesses.

Part of the CARES Act provides an Employee Retention Credit (“ERC”), which is a refundable tax credit against certain employment taxes equal to 50 % of qualified wages paid, up to $ 10,000 per employee annually, from March 12, 2020 through January 1, 2021.

Additional relief provisions were passed by the United States government, which extended and expanded the qualified wage caps on these credits to 70 % of qualified wages paid through June 30, 2021 and 100 % of qualified wages paid through December 31, 2021, up to $ 10,000 per employee per quarter.

In January 2023, the Company filed Form 941-X for the three months ended March 31, June 30 and September 30, 2021 to claim a refund for the ERC.

The Company elected to account for the ERC under IAS 20 when there was reasonable assurance of receipt, which was determined to be when the notification of acceptance of Form 941-X was received by the IRS.

In June 2023, the Company received confirmation from the IRS that changes to the Company’s Q1, Q2 and Q3 941 forms amounting to $ 224 thousand in the first quarter of 2021, $ 238 thousand in the second quarter of 2021, and $ 201 thousand in the third quarter of 2021 had been accepted.

The Company received payment from the IRS related to the ERC during the second quarter of 2023 and recorded other income of $ 663 thousand in the accompanying consolidated statement of operations for the year ended December 31, 2023.

The components of worldwide pre-tax book loss are as follows:

As discussed in Note 1 – Description of Business and Summary of Significant Accounting Policies , the Company adopted ASU 2023‑09 on a retrospective basis effective for the year ended December 31, 2025.

Comparative prior year disclosures have been reported for the year ended December 31, 2024.

Adoption of this standard did not have a material impact on the Company’s consolidated financial statements, but resulted in enhanced disclosures related to the income tax rate reconciliation and income taxes paid.

The c omponents of worldwide pre-tax book loss are as follows (in thousands):

Domestic pre-tax book loss

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The amount of and ultimate realization of the benefits from the operating loss carryforwards for income tax purposes is dependent, in part, upon the tax laws in effect, the future earnings of the Company, and other future events, the effects of which cannot be determined at this time.

Because of the uncertainty surrounding the realization of the loss carryforwards, the Company has established a valuation

allowance equal to the tax effect of the loss carryforwards, R&D credits, and accruals;

therefore, no net deferred tax asset has been recognized.

A reconciliation of the statutory federal income tax rate and the effective income tax rate for the years ended December 31, 2024 and 2023 is as follows:

Because of the uncertainty surrounding the realization of the loss carryforwards, the Company has established a valuation allowance equal to the tax effect of the loss carryforwards, R&D credits, and accruals;

therefore, no net deferred tax asset has been

Comparative prior year amounts may differ from amounts previously reported due to changes in judgment and/or estimates, including the effects of tax laws enacted after prior year end but applied retroactively.

A reconciliation of the statutory federal income tax rate and the effective income tax rate for the years ended December 31, 2025 and December 31, 2024 is as follows (in thousands, except percentages):

Year Ended December 31, 2025

Year Ended December 31, 2024

Statutory federal income tax rate

Nontaxable or nondeductible items

Incentive stock option expense

Other permanent differences

State and local income taxes

State income taxes, net of federal taxes (1)

Foreign rate differentials

Permanent items

Change in valuation allowance

Research and development tax credits limitation

Employee retention credit income

Stock-based compensation

Adjustments to NOL

ASC 740-10 adjustments

State net operating losses

State IRC 174 conformity

Foreign tax effects

Foreign net operating losses

Other adjustments

Change in valuation allowance

Other adjustments

Stock options deferred tax asset true-up

Stock options cancellations and expirations

IRC 174 expensing - One Big Beautiful Bill Act

Temporary true-ups and other

Adjustment to net operating losses

Effective income tax rate

(1) California's income tax expense makes up a greater than 50% share of the entire tax expense calculated in this category.

The Company files income tax returns in the U.S.

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The Company includes penalties and interest expense related to income taxes as a component of other expense and interest expense, respectively, as necessary.

A reconciliation of the reserve for unrecognized tax benefits is as follows (in thousands):

A rec onciliation of the reserve for unrecognized tax benefits is as follows (in thousands):

Balance at December 31, 2023

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There can be no assurance that the Company will ever be able to realize the benefit of some or all of the federal and state loss carryforwards or credit carryforwards, either due to ongoing operating losses or due to ownership change limitations.

Significant components of deferred tax assets and liabilities are as follows (in thousands):

Significant c omponents of deferred tax assets and liabilities are as follows (in thousands):

Deferred tax assets:

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Net deferred tax assets

The components of income taxes paid (net of refunds) are as follows (in thousands):

Federal taxes

State and local taxes

Other state and local jurisdictions

Foreign taxes

Total income taxes paid

Related Party Transactions

1 unchanged sentence

On October 26, 2021, the Company and S Real Estate Holdings, LLC jointly entered into a lease agreement with Rehco Holdings, LLC (the “Lease”), for the purpose of establishing a new corporate headquarters, including corporate, R&D, and manufacturing operations.

S Real Estate Holdings LLC is owned by Dr.

Russell Kern, the Company’s Executive Vice President, Chief Scientific Officer.

The Lease was personally guaranteed by the Dr.

Russell Kern, the Company’s Executive Vice President, Chief Scientific Officer.

The Lease was personally guaranteed by Dr.

Russell Kern, the Company’s Executive Vice President and Chief Scientific Officer.

On December 15, 2021, the Company and S Real Estate Holdings LLC entered into a co-tenant agreement, whereby the Company and S Real Estate Holdings LLC agreed to allocate portions of the base rent and variable charges, including insurance, maintenance costs, taxes, and operating expenses, between the parties.

During the term of the Lease, the Company will be liable for 40 % of all costs incurred in connection with the Lease.

Refer to Note 11 – Commitments & Contingencies within the consolidated financial statements for further discussion.

During the term of the Lease, the Company was liable for 40 % of all costs incurred in connection with the Lease.

In February 2025, the Company amended its co-tenant agreement to re-allocate portions of the base rent and variable charges.

Retroactively, as of January 2025, the Company became liable for 75 % of all costs incurred in connection with the lease.

Refer to Note 10 – Commitments & Contingencies for further discussion.

Related party note payable

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There were no debt issuance fees associated with this issuance.

In March 2023, the Noteholder surrendered the Note, and the Company issued a new promissory note (“March 2023 Note”), which featured all the same terms as the previously outstanding note, with the exception of an extension of the maturity date from March 15, 2023 to September 15, 2023 .

The March 2023 Note has a principal balance of $ 2.9 million, an interest rate of 4.5 %, and features optional prepayment terms.

There were no debt issuance fees associated with this issuance.

In September 2023, the Noteholder surrendered the March 2023 Note, and the Company issued a new promissory note (“September 2023 Note”), which featured all the same terms as the previously outstanding note, with the exception of an extension of the maturity date from September 15, 2023 to September 15, 2024 .

The September 2023 Note has a principal balance of $ 2.9 million, an interest rate of 4.5 %, and features optional prepayment terms.

There were no debt issuance fees associated with this issuance.

During 2023, the Note was amended several times, with the final amendment resulting in the issuance of the new promissory note in September 2023 ("September 2023 Note") with a maturity date of September 15, 2024 .

The September 2023 Note had a principal balance of $ 2.9 million, an interest rate of 4.5 %, optional prepayment terms, and no associated debt issuance fees.

All amendments during the year ended December 31, 2023 qualified as troubled debt restructurings, which did not result in a gain as the carrying amount of the debt was less than the total future cash payments of the restructured debt.

On September 15, 2024, the Company surrendered its September 2023 Note, which included repaying $ 0.2 million in outstanding principal, reducing the principal balance to $ 2.7 million, increasing the interest rate from 4.5 % to 5.5 %, and extending the maturity date from September 15, 2024 to September 15, 2025 (“September 2024 Note”).

In September 2024, the Company surrendered its September 2023 Note and entered into a new agreement (“September 2024 Note”), which included repaying $ 0.2 million in outstanding principal, reducing the principal balance to $ 2.7 million, increasing the interest rate from 4.5 % to 5.5 %, and extending the maturity date from September 15, 2024 to September 15, 2025 .

All other terms of the September 2024 Note are the same as the previously outstanding note and there were no debt issuance fees associated with this issuance.

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The repayment of principal was accounted for as a partial extinguishment of debt, which did not result in an extinguishment gain or loss.

In June 2025, the Company repaid $ 0.2 million in outstanding principal, reducing the principal balance to $ 2.5 million.

In September 2025, the Company surrendered its September 2024 Note and entered into a new agreement (“September 2025 Note”), which included extending the maturity date from September 15, 2025 to September 15, 2026 .

All other terms of the September 2025 Note are the same as the previously outstanding note and there were no debt issuance fees associated with this issuance.

Pursuant to ASC 470-60, the amendment did not qualify as a troubled debt restructuring as the creditor did not grant a concession.

As the terms of the September 2025 Note were not substantially different than the terms of the September 2024 Note, the amendment was accounted for as a debt modification.

The repayment of principal was accounted for as a partial extinguishment of debt, which did not result in an extinguishment gain or loss.

Commitments and Contingencies

At December 31, 2025 , the Company has three operating leases for real estate in California and Maryland:

• San Diego, California – corporate headquarters, including corporate, R&D, and manufacturing operations, with a termination date of December 2026 , jointly leased with a related party (refer to Note 10 – Related Party Transactions within the consolidated financial statements for further discussion).

• San Diego Headquarters Lease (San Diego, California) – corporate headquarters, including corporate, R&D, and manufacturing operations, with a termination date of December 2026 , jointly leased with a related party (refer to Note 9 – Related Party Transactions for further discussion).

This lease contains no renewal or term extension options;

• San Diego, California – supplemental office space adjacent to the Company’s corporate headquarters with a termination date of December 2026 .

• San Diego Supplemental Office Lease (San Diego, California) – supplemental office space adjacent to the Company’s corporate headquarters with a termination date of December 2026 .

This lease contains no renewal or term extension options;

• Frederick, Maryland – mixed laboratory and administrative space with a term date of November 2025 .

The lease contains one renewal option for an additional three-year term through November 2028.

• Maryland Facility Lease (Frederick, Maryland) – mixed laboratory and administrative space with a termination date of December 2026 .

The lease contains one renewal option for an additional term through December 2029.

The renewal option is not included in the lease term as it is not reasonably certain that the Company will exercise its renewal option.

In October 2021, the Company entered into an operating lease for its new corporate headquarters.

In October 2021, the Company entered into the San Diego Headquarters Lease, an operating lease for its new corporate headquarters.

The lease commenced in November 2021 and expires on December 31, 2026 .

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At lease commencement, the Company recognized a right-of-use asset and lease liabilities of approximately $ 232 thousand.

In November 2021, the Company entered into an operating lease for supplemental office space adjacent to its new corporate headquarters with the same landlord.

In November 2021, the Company entered into the San Diego Supplemental Office Lease, an operating lease for supplemental office space adjacent to its new corporate headquarters with the same landlord.

The lease commenced in December 2021 and expires on December 31, 2026 , and is not subject to the co-tenant agreement with S Real Estate Holdings, LLC.

1 unchanged sentence

At lease commencement, the Company recognized a right-of-use asset and lease liabilities of approximately $ 247 thousand.

The Company’s operating leases for real estate are subject to additional variable charges for common area maintenance and other variable costs, and do not include an option to extend the lease term.

In January 2025, the Company agreed to an addition on the San Diego Supplemental Office Lease.

Base rent due under the new lease addition was approximately $ 4 thousand per month.

At lease commencement, the Company recognized a right-of-use asset and lease liabilities of approximately $ 93 thousand.

In March 2025, the Company and St.

John Properties, Inc, amended the Maryland Facility Lease to extend the lease expiration for one year from December 31, 2025 to December 31, 2026 .

As a result of the amended lease agreement, the Company reassessed the lease liability and associated right-of-use-asset.

At the lease modification date, the Company recognized a right-of-use asset and lease liabilities of approximately $ 209 thousand.

The Company’s operating leases for real estate are subject to additional variable charges for common area maintenance and other variable costs.

At December 31, 2025, total right-of-use assets and operating lease liabilities were approximately $ 344 thousand and $ 393 thousand, respectively.

16 unchanged sentences

Operating lease liabilities, net of current portion

Licensed Patents

The Company had a minimum annual license fee of $ 75 thousand payable in two installments per year to Astellas Pharma pursuant to the amended UMass IP license agreement.

The patents, along with the license agreement, expired at the end of July 2022 .

These patents were fully impaired in prior years and, therefore, the expiration did not result in any impairment for the year ended December 31, 2022.

The Company does not anticipate any short-term liquidity effects from this obligation as they will no longer be liable for the annual licensing fee.

Segments and Geographic Information

22 unchanged sentences

(Loss) income from operations

Total other expense, net

Other expense, net

Additional Segment Information

2 unchanged sentences

Share-based compensation expense

(1) Includes interest expense and interest expense - related party.

Year Ended December 31, 2024

7 unchanged sentences

(Loss) income from operations

Total other income, net

Other expense, net

Additional Segment Information

2 unchanged sentences

Share-based compensation expense

(1) Includes interest expense and interest expense - related party.

Geographic Information

The Company’s wholly owned subsidiaries are located in Maryland, California, and Victoria, Australia, and have customer and vendor relationships worldwide.

The Company’s long-lived assets including property, plant, and equipment, net, right-of-use assets, and intangible assets, net are domiciled in the United States.

The Company’s long-lived assets including property and equipment, net, right-of-use assets, and intangible assets, net are domiciled in the United States.

Significant revenues in the following regions are those that are attributable to the individual country within the region to which the product was shipped were as follows (in thousands):

3 unchanged sentences

Subsequent Events

In February 2025, the Company and S Real Estate Holdings, LLC, a related party, amended its co-tenant agreement to re-allocate portions of the base rent and variable charges.

Retroactively, as of January 2025, the Company will now be liable for 75 % of all costs incurred in connection with the Lease.

As a result of the amended co-tenant agreement, the Company will recognize a lease liability and right-of-use asset as of the modification date in Fiscal Year 2025.

In March 2025, the Company and St.

John Properties, Inc, amended its lease agreement to extend the lease expiration for one year from December 31, 2025 to December 31, 2026 .

As a result of the amended lease agreement, the Company will reassess the lease liability and associated right-of-use-asset in Fiscal Year 2025.

In February 2026, the Company repaid $ 150 thousand in outstanding principal on the September 2025 Note, reducing the principal balance to $ 2,350 thousand.

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

What changed 10-K

Item 9A. Controls and Procedures