Item 9A. Controls and Procedures
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
It is management’s responsibility to establish and maintain adequate internal control over all financial reporting pursuant to Rule 13a-15 under the Exchange Act. Our management, including our principal executive officer and our principal financial officer, have reviewed and evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2024. Following this review and evaluation , management collectively determined that our disclosure controls and procedures were effective as of December 31, 2024 to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act: (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms; and (ii) is accumulated and communicated to management, including principal executive officer and our principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the fourth quarter of 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting, as defined in Exchange Act Rule 13a-15(f), is a process designed by, or under the supervision of, our principal executive officer, and our principal financial officer, and effected by our Board of Directors, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
• Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
• Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and
• Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. The scope of management’s assessment of the effectiveness of internal control over financial reporting includes our consolidated subsidiaries.
Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2024, based on criteria established in the 2013 Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management believes that, as of that date, our internal control over financial reporting was effective.
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This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. As a non-accelerated filer, we are not required to have, nor have we, engaged our independent registered public accounting firm to perform an audit of internal control over financial reporting pursuant to SEC rules that permit us to provide only management’s report in this Annual Report on Form 10-K .
ITE M 9B. OTHER INFORMATION
(a) None.
(b) During the period from October 1, 2024 to December 31, 2024, none of our directors or officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated any Rule 10b5-1 trading arrangement (as defined in Item 408(a)(1)(i) of Regulation S-K) or any non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K).
ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
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P ART III
ITE M 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information required by this Item will be included in our definitive proxy statement to be filed with the SEC within 120 days after December 31, 2024, in connection with the solicitation of proxies for our 2025 annual meeting of shareholders (the “2025 Proxy Statement”), and is incorporated herein by reference.
We have a written Code of Ethics that applies to our principal executive officer, our principal financial officer and accounting officer, our other executive officers, and our directors. The purpose of the Code of Ethics is to promote (i) honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; (ii) full, fair, accurate, timely, and understandable disclosure in reports and documents that we file with or submit to the Securities and Exchange Commission and in our other public communications; (iii) compliance with applicable governmental rules and regulations; (iv) prompt internal reporting of violations of the Code of Ethics to an appropriate person or persons identified in the Code; and (v) accountability for adherence to the Code. A copy of our Code of Ethics has been posted on our internet website and can be found at www.lineagecell.com . If we amend or waive a provision of our Code of Ethics that applies to our chief executive officer or chief financial officer, we will post the amended Code of Ethics or information about the waiver on our internet website.
ITE M 11. EXECUTIVE COMPENSATION
The information required by this Item will be included in the 2025 Proxy Statement and is incorporated herein by reference.
IT EM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT, AND RELATED STOCKHOLDER MATTERS
The information required by this Item will be included in the 2025 Proxy Statement and is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information required by this Item will be included in the 2025 Proxy Statement and is incorporated herein by reference.
ITE M 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by this Item will be included in the 2025 Proxy Statement and is incorporated herein by reference.
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PA RT IV
ITE M 15. EXHIBIT AND, FINANCIAL STATEMENT SCHEDULES
(a)(1) Financial Statements.
The following financial statements of Lineage are filed in this report:
Independent Registered Public Accounting Firm - Audit Opinion Moss Adams LLP (PCAOB #659)
94
Independent Registered Public Accounting Firm - Audit Opinion WithumSmith+Brown, PC (PCAOB #100)
96
Financial Statements:
Consolidated Balance Sheets
97
Consolidated Statements of Operations
98
Consolidated Statements of Comprehensive Loss
99
Consolidated Statements of Shareholders Equity
100
Consolidated Statements of Cash Flows
101
Notes to the Consolidated Financial Statements
102
(a)(2) Financial Statement Schedules
All financial statement schedules have been omitted, since the required information is not applicable or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the consolidated financial statements and accompanying notes included in this report.
(a)(3) Exhibits.
Exhibits not filed or furnished herewith are incorporated by reference to exhibits previously filed with the SEC, as reflected in the table below. We will furnish a copy of any exhibit to stockholders, without charge upon written request to Lineage Cell Therapeutics, Inc., Attention: Corporate Secretary, 2173 Salk Avenue, Suite 200 Carlsbad, CA 92008, or by calling (442) 287-8990.
Incorporation by Reference
Exhibit
Number
Description
Exhibit
Number
Filing
Filing Date
File No.
PLANS OF ACQUISITION
2.01^
Agreement and Plan of Merger dated November 7, 2018, among Registrant, Patrick Merger Sub, Inc. and Asterias Biotherapeutics, Inc. (“Asterias”)
2.1
8-K
November 8, 2018
001-12830
ARTICLES OF INCORPORATION AND BYLAWS
3.01
Restated Articles of Incorporation, as amended
3.1
10-Q
May 10, 2018
001-12830
3.02
Certificate of Ownership
3.1
8-K
August 12, 2019
001-12830
3.03
Amended and Restated Bylaws
3.1(a)
8-K
June 13, 2024
001-12830
INSTRUMENTS DEFINING RIGHTS OF SECURITY HOLDERS
4.01
Specimen of Common Share Certificate
S-1
December 18, 1991
033-44549
4.02*
Description of Capital Stock of the Registrant
4.03(a)
Form of Common Stock Purchase Warrant issued pursuant to the Securities Purchase Agreement dated November 19, 2024, between Lineage Cell Therapeutics, Inc. and the purchaser parties thereto
4.1
8-K
November 20, 2024
001-12830
4.03(b)
Form of Placement Agent Warrant
4.3
8-K
November 20, 2024
001-12830
4.03(c)*
Warrant issued to Broadwood Partners, L.P. on January 27, 2025
MANAGEMENT CONTRACTS AND COMPENSATORY PLANS
10.01+
Form of Indemnification Agreement entered into between the Registrant and its Directors and Officers
10.1
10-Q
August 11, 2022
001-12830
136
10.02+
Amended and Restated Employment Agreement dated September 26, 2022 between Registrant and Brian Michael Culley
10.2
10-Q
November 10, 2022
001-12830
10.02(a)+
Amendment No. 1 to Employment Agreement entered into as of March 6, 2024 between Registrant and Brian M. Culley
10.1
10-Q
May 9, 2024
001-12830
10.03+
Amended and Restated Employment Agreement dated September 26, 2022 between Registrant and George A. Samuel III
10.3
10-Q
November 10, 2022
001-12830
10.03(a)+
Amendment No. 1 to Employment Agreement entered into as of March 6, 2024 between Registrant and George A. Samuel III
10.3
10-Q
May 9, 2024
001-12830
10.04+
Employment Agreement dated November 14, 2022 between Registrant and Jill A. Howe
10.7
10-K
March 9, 2023
001-12830
10.04(a)
Amendment No. 1 to Employment Agreement entered into as of March 6, 2024 between Registrant and Jill A. Howe
10.2
10-Q
May 9, 2024
001-12830
10.05+
Inducement Stock Option Agreement between Registrant and Brian Culley
10.18
10-K
March 14, 2019
001-12830
10.06+
Lineage Cell Therapeutics 2012 Equity Incentive Plan, as amended July 2015 (“2012 Plan”)
4.1
S-8
July 15, 2015
333-205661
10.06(b)+
Amendment to 2012 Plan effective June 2017
4.2
S-8
July 7, 2017
333-219204
10.06(c)+
Amendment to 2012 Plan effective July 2019
99.3
S-8
August 8, 2019
333-233132
10.06(d)+
Amendment to 2012 Plan effective August 2019
10.1
10-Q
November 12, 2019
001-12830
10.06(e)+
2012 Plan Form of Employee Incentive Stock Option Agreement
10.7
10-Q
November 12, 2013
001-12830
10.06(f)+
2012 Plan Form of Non-employee Director Stock Option Agreement
10.8
10-Q
November 12, 2013
001-12830
10.06(g)+
2012 Plan Stock Option Grant Agreement
10.2
10-Q
November 12, 2019
000-12830
10.06(h)+
2012 Plan Form of Restricted Stock Unit
10.6
10-K
March 12, 2020
001-12830
10.07+
Lineage Cell Therapeutics 2021 Equity Incentive Plan, effective as of September 2021 (“2021 Plan”)
10.1
8-K
September 15, 2021
001-12830
10.07(a)+
Amendment to 2021 Plan effective September 6, 2023
10.01
8-K
September 7, 2023
001-12830
10.07(b)+
2021 Plan Form of Stock Option Grant Notice and Agreement for Employees and Consultants
99.2
S-8
September 28, 2021
333-259853
10.07(c)+
2021 Plan Form of Stock Option Grant Notice and Agreement for Non-Employee Directors
99.3
S-8
September 28, 2021
333-259853
10.07(d)+
2021 Plan Form of Restricted Stock Unit Award Grant Notice and Agreement
99.4
S-8
September 28, 2021
333-259853
10.08+
Executive Performance Incentive Bonus Plan, adopted September 2022
10.5
10-Q
November 10, 2022
001-12830
COMMERCIAL AGREEMENTS
10.09
Commercial License and Option Agreement between Registrant and Wisconsin Alumni Research Foundation (“WARF Agreement”)
10.1
8-K
January 9, 2008
001-12830
10.09(a)
First Amendment to WARF Agreement dated March 11, 2009
10.38
10-K
March 23, 2009
001-12830
10.10**
Second Amended and Restated License Agreement dated June 15, 2017, between Cell Cure Neurosciences, Ltd. and Hadasit Medical Research Services and Development Ltd. (“Hadasit License”)
10.1
10-Q
August 8, 2024
001-12830
10.10(a)
Amendment to Hadasit License dated January 8, 2018
10.38
10-K
March 15, 2018
001-12830
10.10(b)
Second Amendment to Hadasit License dated December 1, 2019
10.4(b)
10-K
March 10, 2022
001-12830
137
10.10(c)
Side Letter Agreement dated December 17, 2021 between Hadasit Medical Research Services and Development Ltd., Cell Cure Neurosciences Ltd., Genentech, Inc. and F. Hoffmann-La Roche Ltd
10.4(c)
10-K
March 10, 2022
001-12830
10.10(d)
Second Side Letter Agreement dated December 17, 2021 between Hadasit Medical Research Services and Development Ltd. and Cell Cure Neurosciences Ltd.
10.4(d)
10-K
March 10, 2022
001-12830
10.11
Debt and Note Purchase Agreement dated June 16, 2017, as amended June 29, 2017, between Registrant and HBL-Hadasit Bio-Holdings Ltd.
10.3
10-Q
August 9, 2017
001-12830
10.12
Share Purchase and Transfer Agreement dated June 16, 2017, by and among Registrant and HBL-Hadasit Bio-Holdings Ltd. and Cell Cure Neurosciences Ltd.
10.4
10-Q
August 9, 2017
001-12830
10.13
Non-exclusive License Agreement dated October 7, 2013 between WARF and Asterias
10.5
Asterias 10-Q
November 12, 2013
000-55046
10.14
Form of Securities Purchase Agreement dated November 19, 2024, between Lineage Cell Therapeutics, Inc. and the purchaser parties thereto
10.1
8-K
November 20, 2024
001-12830
10.15
Form of Securities Purchase Agreement dated November 19, 2024, between Lineage Cell Therapeutics, Inc. and Broadwood Partners, L.P.
10.2
8-K
November 20, 2024
001-12830
10.16
Collaboration and License Agreement dated December 17, 2021, between F. Hoffmann-La Roche Ltd, Genentech, Inc., Cell Cure Neurosciences Ltd., and Registrant
10.13
10-K
March 10, 2022
001-12830
19.01*
Insider Trading Policy effective June 11, 2024
OTHER EXHIBITS
21.01*
List of Subsidiaries of the Registrant
23.01*
Consent of Moss Adams LLP
23.02*
Consent of WithumSmith+Brown, PC
31.01*
Certification of Chief Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002
31.02*
Certification of Chief Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002
32.01#
Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
97
Lineage Cell Therapeutics, Inc. Clawback Policy
97
10-K
March 7, 2024
001-12830
101.INS*
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*
Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents
104*
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
^ The schedules and exhibits to the merger agreement have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished to the Securities and Exchange Commission upon request.
* Filed herewith.
# Furnished herewith.
+ Indicates management contract or compensatory plan or arrangement.
Portions of this exhibit have been omitted pursuant to a request for confidential treatment.
Certain information in this exhibit has been omitted pursuant to Item 601 of Regulation S-K.
** This exhibit previously was filed as Exhibit 10.2 to the Company’s quarterly report on Form 10-Q for the quarter ended June 30, 2017 with certain information omitted pursuant to an order issued by the SEC on September 12,
138
2017 granting confidential treatment under the Securities Exchange Act of 1934 for such omitted information through August 9, 2024. In accordance with CF Disclosure Guidance: Topic No. 7, the Company is electing to transition to compliance with the requirements set out in Regulation S-K Item 601(b)(10), and, accordingly is refiling this exhibit with portions of it redacted in compliance with Regulation S-K Item 601(b)(10) as indicated therein.
ITE M 16. FORM 10-K SUMMARY
None.
139
SI GNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: March 10, 2025
LINEAGE CELL THERAPEUTICS, INC.
By:
/s/ Brian M. Culley
Brian M. Culley
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Signature
Title
Date
/s/ Brian M. Culley
Chief Executive Officer and Director
March 10, 2025
BRIAN M. CULLEY
(Principal Executive Officer)
/s/ Jill Ann Howe
Chief Financial Officer
March 10, 2025
JILL ANN HOWE
(Principal Financial and Accounting Officer)
/s/ Deborah Andrews
Director
March 10, 2025
DEBORAH ANDREWS
/s/ Dipti Amin
Director
March 10, 2025
DIPTI AMIN
/s/ Don M. Bailey
Director
March 10, 2025
DON M. BAILEY
/s/ Neal C. Bradsher
Director
March 10, 2025
NEAL C. BRADSHER
/s/ Anula Jayasuriya
Director
March 10, 2025
ANULA JAYASURIYA
/s/ Michael H. Mulroy
Director
March 10, 2025
MICHAEL H. MULROY
/s/ Angus C. Russell
Director
March 10, 2025
ANGUS C. RUSSELL
140