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, 2022. Following this review and evaluation ,
management collectively determined that our disclosure controls and procedures were effective as of December 31, 2022 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 2022 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, 2022, 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.
128 | P a g e
ITEM
9B.
OTHER
INFORMATION
None
ITEM
9C.
Disclosure
Regarding Foreign Jurisdictions that Prevent Inspections
Not
applicable
PART
III
ITEM
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 the
December 31, 2022, in connection with the solicitation of proxies for our 2023 annual meeting of shareholders (the “2023 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.
ITEM
11.
EXECUTIVE
COMPENSATION
The
information required by this Item will be included in the 2023 Proxy Statement and is incorporated herein by reference.
ITEM
12.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT, AND RELATED STOCKHOLDER MATTERS
The
information required by this Item will be included in the 2023 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 2023 Proxy Statement and is incorporated herein by reference.
ITEM
14.
PRINCIPAL
ACCOUNTANT FEES AND SERVICES
The
information required by this Item will be included in the 2023 Proxy Statement and is incorporated herein by reference.
129 | P a g e
PART
IV
ITEM
15.
EXHIBITS
AND, FINANCIAL STATEMENT SCHEDULES
(a)(1)
Financial Statements.
The
following financial statements of Lineage are filed in this report:
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Comprehensive Loss
Consolidated Statements of Changes in Shareholders’ Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
(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., 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
3.2
8-K
August
12, 2019
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
4.2
10-K
March
11, 2021
001-12830
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
130 | P a g e
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
10.03+
Employment Agreement dated June 8, 2021 between Registrant and Kevin Leon Cook
10.3
10-Q
August
12, 2021
001-12830
10.04+
Separation Agreement dated July 5, 2022 between Registrant and Kevin Leon Cook
10.1
8-K
July
7, 2022
001-12830
10.05+
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
10.06+
Amended and Restated Employment Agreement dated September 26, 2022 between Registrant and Gary S. Hogge
10.4
10-Q
November
10, 2022
001-12830
10.07*+
Employment Agreement dated November 14, 2022 between Registrant and Jill A. Howe
10.08+
Inducement Stock Option Agreement between Registrant and Brian Culley
10.18
10-K
March
14, 2019
001-12830
10.09+
Lineage Cell Therapeutics 2012 Equity Incentive Plan, as amended July 2015 (“2012 Plan”)
4.1
S-8
July
15, 2015
333-205661
10.09(a)+
Amendment to 2012 Plan effective June 2017
4.2
S-8
July
7, 2017
333-219204
10.09(b)+
Amendment to 2012 Plan effective July 2019
99.3
S-8
August
8, 2019
333-233132
10.09(c)+
Amendment to 2012 Plan effective August 2019
10.1
10-Q
November
12, 2019
001-12830
10.09(d)+
2012 Plan Form of Employee Incentive Stock Option Agreement
10.7
10-Q
November
12, 2013
001-12830
10.09(e)+
2012 Plan Form of Non-employee Director Stock Option Agreement
10.8
10-Q
November
12, 2013
001-12830
10.09(f)+
2012 Plan Stock Option Grant Agreement
10.2
10-Q
November
12, 2019
000-12830
10.09(g)+
2012 Plan Form of Restricted Stock Unit
10.6
10-K
March
12, 2020
001-12830
10.10+
Lineage Cell Therapeutics 2021 Equity Incentive Plan, effective as of September 2021 (“2021 Plan”)
10.1
8-K
September
15, 2021
001-12830
10.10(a)+
2021 Plan Form of Stock Option Grant Notice and Agreement for Employees and Consultants
99.2
S-8
September
28, 2021
333-259853
10.10(b)+
2021 Plan Form of Stock Option Grant Notice and Agreement for Non-Employee Directors
99.3
S-8
September
28, 2021
333-259853
10.10(c)+
2021 Plan Form of Restricted Stock Unit Award Grant Notice and Agreement
99.4
S-8
September
28, 2021
333-259853
10.11+
Executive Performance Incentive Bonus Plan, adopted September 2022
10.5
10-Q
November
10, 2022
001-12830
COMMERCIAL
AGREEMENTS
10.12
Commercial License and Option Agreement between Registrant and Wisconsin Alumni Research Foundation (“WARF Agreement”)
10.1
8-K
January
9, 2008
001-12830
10.12(a)
First Amendment to WARF Agreement dated March 11, 2009
10.38
10-K
March
23, 2009
001-12830
131 | P a g e
10.13†
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”)
10.2
10-Q
August
9, 2017
001-12830
10.13(a)
Amendment to Hadasit License dated January 8, 2018
10.38
10-K
March
15, 2018
001-12830
10.13(b) ††
Second Amendment to Hadasit License dated December 1, 2019
10.4(b)
10-K
March
10, 2022
001-12830
10.13(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
10.13(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
10.14†
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
10.15†
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
10.16
Royalty Agreement dated October 1, 2013 between Asterias and Geron Corporation
10.6
Asterias
S-1/A
August
13, 2013
333-187706
10.17
Exclusive Sublicense Agreement between Geron Corporation and Asterias
10.7
Asterias
S-1/A
August
13, 2013
333-187706
10.18†
Non-exclusive License Agreement dated October 7, 2013 between WARF and Asterias
10.5
Asterias
10-Q
November
12, 2013
000-55046
10.19†
Clinical Trial and Option Agreement dated September 8, 2014 between Asterias and Cancer Research UK and Cancer Research Technology Limited (“CRT”)
10.1
Asterias
10-Q/A
January
13, 2015
001-36646
10.19(a) ††
Second Amendment to Clinical Trial and Option Agreement dated May 6, 2020 between Cancer Research UK, CRT, Asterias Biotherapeutics, Inc. and Registrant
10.1
10-Q
August
6, 2020
001-12830
10.19(b) ††
License Agreement dated May 6, 2020 between CRT and Registrant
10.2
10-Q
August
6, 2020
001-12830
10.19(c)
First Amendment to License Agreement dated April 16, 2021, between CRT and Registrant
10.1
10-Q
August
12, 2021
001-12830
10.20 ††
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
10.21*
Stipulation and Agreement of Compromise and Settlement dated October 26, 2022
132 | P a g e
OTHER
EXHIBITS
21.01*
List of Subsidiaries of the Registrant
23.01*
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
101*
Interactive
Data File
101.INS*
XBRL
Instance Document
101.SCH*
XBRL
Taxonomy Extension Schema
101.CAL*
XBRL
Taxonomy Extension Calculation Linkbase
101.DEF*
XBRL
Taxonomy Extension Definition Document
101.LAB*
XBRL
Taxonomy Extension Label Linkbase
101.PRE*
XBRL
Taxonomy Extension Presentation Linkbase
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.
ITEM
16.
FORM
10-K SUMMARY
None
133 | P a g e
SIGNATURES
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 9, 2023
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
9, 2023
BRIAN
M. CULLEY
(Principal
Executive Officer)
/s/
Jill Ann Howe
Chief
Financial Officer
March
9, 2023
JILL ANN HOWE
(Principal
Financial and Accounting Officer)
/s/
Deborah Andrews
Director
March
9, 2023
DEBORAH
ANDREWS
/s/
Dipti Amin
Director
March
9, 2023
DIPTI
AMIN
/s/
Don M. Bailey
Director
March
9, 2023
DON
M. BAILEY
/s/
Neal C. Bradsher
Director
March
9, 2023
NEAL
C. BRADSHER
/s/
Alfred D. Kingsley
Director
March
9, 2023
ALFRED
D. KINGSLEY
/s/
Anula Jayasuriya
Director
March
9, 2023
ANULA
JAYASURIYA
/s/
Michael H. Mulroy
Director
March
9, 2023
MICHAEL
H. MULROY
/s/
Angus C. Russell
Director
March
9, 2023
ANGUS
C. RUSSELL
134 | P a g e