SAB Biotherapeutics, Inc. 10-K

Item 9A. Controls and Procedures. Evaluation of Disclosure Controls and Procedures Our management, with the participation of our Chief Executive Officer and Chief Financial Officer has evaluated the effectiveness of our disclosure controls and procedures. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost benefit relationship of possible controls and procedures. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were not effective as of the end of the fiscal year covered by this Annual Report as a result of the material weaknesses in Internal Control over Financial Reporting described below. Management’s Report on Internal Control over Financial Reporting Management, including our Chief Executive Officer and Chief Financial Officer, is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a- 15(f) and 15d-15(f) under the Exchange Act and based upon the criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“the COSO framework”). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of our financial statements for external purposes in accordance with U.S. GAAP. An effective internal control system, no matter how well designed, has inherent limitations, including the possibility of human error or overriding of controls, and therefore can provide only reasonable assurance with respect to reliable financial reporting. Because of its inherent limitations, our internal control over financial reporting may not prevent or detect all misstatements, including the possibility of human error, the circumvention or overriding of controls, or fraud. Effective internal controls can provide only reasonable assurance with respect to the preparation and fair presentation of financial statements. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we have conducted an evaluation of the effectiveness of our internal control over financial reporting based on the COSO framework. Based on evaluation under these criteria and based upon the existence of the material weakness described below, management determined, that we did not maintain effective internal control over financial reporting as of December 31, 2023. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that a reasonable possibility exists that a material misstatement of our annual or interim financial statements would not be prevented or detected on a timely basis. We identified deficiencies in the control environment component of the COSO Framework that constitute a material weakness: • We lack documentation of the formalized processes and procedures that are critical to the accomplishment of financial reporting objectives. Management believes that the material weakness set forth above is the result of the scale of our operations, is intrinsic to our size, and intends to take remedial actions described below. 79 Plan for Remediation of Material Weakness We continue to work to strengthen our internal control over financial reporting and are committed to ensuring that such controls are designed and operating effectively. We are implementing process and control improvements to address the above material weakness as follows: • We have engaged with a third party firm to perform a complete risk assessment and provide advisory services for our required documented control attributes and necessary remediation efforts. • We will soon complete the process of implementing a contract management platform that will integrate functions governing the initiation, authorization, and execution of contracts with enhancements for our existing contract review control. This tool will improve the ability of the finance organization to review new and renewed contracts for potential financial reporting implications. We are committed to continuing to improve our internal control processes related to these matters and will continue to review our financial reporting controls and procedures. As we continue to evaluate and work to improve our internal control over financial reporting, we may take additional measures to address deficiencies or modify certain of the remediation measures described above. Changes in Internal Control Over Financial Reporting Other than as described above, there have been no changes in our internal control over financial reporting in connection with the evaluation required by Rules 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the fiscal quarter to which period covered by this Annual Report on Form 10-K relates that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Item 9B. Other Information . None. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections . Not applicable. 80 PART III Item 10. Directors, Executive Officers and Corporate Governance. Directors and Executive Officers The following persons are serving as our executive officers and directors: Name Age Position(s) Samuel J. Reich 49 Class III Director, Chairman of the Board and Chief Executive Officer Christine Hamilton, MBA 68 Class III Director Eddie J. Sullivan, PhD 58 Class III Director and President Jeffrey G. Spragens 82 Class II Director David Link, MBA 68 Class II Director Katie Ellias 45 Class II Director Andrew Moin 40 Class II Director William Polvino, MD 63 Class I Director Scott Giberson 55 Class I Director Erick Lucera 56 Class I Director Michael G. King, Jr. 63 Chief Financial Officer Christoph Bausch, PhD 53 Chief Operating Officer Alexandra Kropotova, MD 51 Chief Medical Officer Family Relationships There are no family relationships among any of our directors or executive officers. Edward Hamilton, our former Chairman, retired from such role as of the consummation of the Business Combination. Mr. Hamilton was named as a board observer in October 2021. Edward Hamilton is Christine Hamilton’s husband. Executive Officers Samuel J. Reich has served as a member of our board of directors from November 2020 and our CEO since January 2024 and was named chairman of our board of directors in October 2021, and was named Chief Executive Officer in January 2024. Mr. Reich served as our Chief Executive Officer and Chief Financial Officer from November 2020 until October 2020 prior to the closing of our Business Combination. Mr. Reich co-founded Biscayne Neurotherapeutics, Inc. in 2011 and served as its Executive Chairman until its sale to Supernus Pharmaceuticals (Nasdaq: SUPN) in October 2018. Biscayne Neurotherapeutics was focused on novel treatments for seizure disorders. Previously, Mr. Reich was the Executive Vice President of OPKO Ophthalmologics, a division of OPKO Health, Inc. (Nasdaq: OPK) from March 2007 to November 2008, where Mr. Reich served on the executive committee and lead the Ophthalmologics business division. Prior to his position at OPKO, Mr. Reich was the Founder and Executive Vice President of Acuity Pharmaceuticals, Inc., where he worked from July 2002 through March 2007, at which time Acuity Pharmaceuticals merged with OPKO Health. Mr. Reich was a doctoral candidate in the Department of Ophthalmology at the University of Pennsylvania Medical School. He left graduate school prior to the completion of his Ph.D. to establish Acuity. Prior to that, he was a graduate student at the University of Pennsylvania in the Biomedical Studies graduate program. He has authored six peer- reviewed scientific publications and is currently an inventor on sixteen issued U.S. patents and over 50 issued foreign patents. Mr. Reich holds a B.A. with High Honors in Biochemistry from Clark University, cum laude, Phi Beta Kappa. Eddie J. Sullivan, PhD , is our co-founder and has served as our president since 2014 and our past CEO from 2014 until January 2024. Dr. Sullivan has served in biopharma leadership positions for more than 25 years. Prior to joining us, he held the CEO role or other leadership roles in our predecessor entities, including CEO of Hematech, a subsidiary of Kyowa Hakko Kirin. During that time, he led initiatives to develop infectious disease, cancer, and autoimmune immunotherapies. In addition to raising over $250 million in capital to develop biopharmaceutical platform technologies, he has also led several successful mergers and acquisitions. A recognized thought leader in antibodies and transgenic animals, Dr. Sullivan serves on the board of directors for the Biotechnology Innovation Organization (BIO) and has served on its executive committee. He has worked with industry committees and discussion groups that have focused on animal biotechnology, regulatory framework, human immunotherapies, and global health threats. Dr. Sullivan was governor-appointed to South Dakota’s Research Commercialization Council and is Chairman of the state’s National Science Foundation-EPSCoR committee. He 81 also founded, served as president, and remains an advisor to the state affiliate of BIO, South Dakota Biotech, and in 2014 was honored for his leadership, innovation, vision, and entrepreneurship with the inaugural LIVE award. He holds an undergraduate degree from the University of Arizona and graduate degrees from Brigham Young University, Kennedy-Western University, and Utah State University in both reproduction and business. Michael G King, Jr. , is our Chief Financial Officer as of October 2023. Mr. King is an award-winning biotechnology industry research analyst with over 25 years of experience advising investors and issuers. From June 2022 to May 2023, Mr. King was Co-Head of Healthcare Research at EF Hutton Group., where he provided coverage on 15 healthcare and biotechnology companies across a range of market capitalizations. From January 2021 to May 2022, he was Managing Director and Senior Biotechnology Analyst with H.C. Wainwright & Co., where he provided coverage on 21 healthcare and biotechnology companies From May 2018 to December 2020, Mr. King acted as Entrepreneur in Residence at Fortress Biotech, Inc., where he was responsible for identifying promising therapeutic molecules, securing rights to their development and commercialization, and forming and capitalization new companies around these molecules. Mr. King has previously held senior roles with prominent companies including JMP Securities LLC, Rodman and Renshaw LLC, Ziopharm Oncology, Inc. Wedbush PacGrow Life Sciences, Bank of America, Robertson Stephens, and Vector Securities. Mr. King’s extensive investment banking and public company advisory experience includes equity research, capital markets, corporate finance, and M&A advisory. He received his BA in Finance from the Bernard M. Baruch College of the City University of New York. Christoph Bausch, PhD, MBA , is our Chief Operating Officer as of May 2022, overseeing all Research & Manufacturing operations of the company. Prior to his role as COO, he served as Chief Science Officer since joining SAB in April 2017, providing leadership in all areas of Research & Development, and functioned as drug development lead for a Stage 3 clinically advanced drug product. Dr. Bausch is an experienced research scientist, biotech entrepreneur and business development executive who has led the successful discovery, development, biomanufacturing, and commercialization of platform technologies in the life sciences. Previously, Dr. Bausch has served as founder and director of a molecular diagnostic company and has provided life science consulting for Keion Group, LLC. Dr. Bausch held several science-based business development positions prior to joining SAB, most recently for multi-billion-dollar global industrial biomanufacturing leader POET, LLC, where he structured strategic partnerships, prospected, and vetted new technologies and streamlined research and development activities. He also worked in both research and commercialization roles for Fortune 500 life science and high technology company Sigma-Aldrich, now MilliporeSigma. Dr. Bausch received his PhD in Microbiology at The Ohio State University, Columbus, Ohio, completed Post-Doctoral Training at the Stowers Institute for Medical Research, Kansas City, Missouri and earned an MBA from St. Louis University, St. Louis, Missouri, in addition to a BA in Biology from the University of Nebraska-Lincoln, Lincoln, Nebraska. Alexandra Kropotova, M.D. , is our Executive Vice President & Chief Medical Officer as of June, 2022, leading the strategy, direction, and execution of the company’s clinical development for the entire portfolio. Dr. Kropotova is a biopharmaceutical executive with expertise in all phases of global clinical development, translational medicine and medical affairs. Prior to joining SAB Biotherapeutics, as a Therapeutic Area Head of Global Specialty R&D at Teva Pharmaceuticals from April 2016 to June 2022, Alexandra led innovative drug development focused on delivering a broad portfolio of immunology, respiratory, and immuno-oncology assets spanning from pre-IND to BLA/NDA filing of biologics and complex drug-device combination products. Prior to Teva, Dr. Kropotova served in various roles at Sanofi, including Vice President, Strategy & Strategic Planning Head, North American Medical Affairs; Associate Vice President and subsequently Vice President, Immuno-Inflammation, Global R&D Clinical Development; and Senior Medical Director, Respiratory, Allergy & Anti-Infectives. She also served in various roles at Pfizer Inc., most recently as Director & Head of Global Clinical Respiratory and Analgesics. She continues to serve on the Board of Directors at iBio, a global leader in plant-based biologics manufacturing and development of novel biopharmaceuticals. Dr. Kropotova received her MBA from Ohio University Graduate School of Business, Athens, Ohio; and her M.D. in Internal Medicine from the Vladivostok State Medical University, Vladivostok, Russia. Non-Employee Directors Biographical information for Eddie J. Sullivan PhD, our President and Class III director, and Samuel J. Reich, our Chairman of the Board, Chief Executive Officer and Class III director, is set forth above in “Item 10. Executive Officers”. Christine Hamilton, MBA , is our co-founder and has served as a member of our board of directors since 2014. Ms. Hamilton is the owner and managing partner of Christiansen Land and Cattle, Ltd., a fourth-generation diversified farming and ranching enterprise. She also owns Dakota Packing, Inc., a wholesale company based in Las Vegas that provides high-end, “center-of-the-plate” protein products to a national customer base. Ms. Hamilton has served on the board of directors for several financial and public companies including HF Financial Corporation, Home Federal Bank (now Great Western Bancorp, NYSE: GWB) and, in 2018, was recognized for her exemplary service as a board member of the Federal Reserve Bank (Ninth District) after a four-year term. She currently serves as a board member for publicly traded Titan Machinery, 82 Padlock Ranch, and Meadowlark Institute. Ms. Hamilton was a governor-appointed commissioner for South Dakota Game Fish & Parks and is a 2016 inductee to the South Dakota Hall of Fame for her contributions to the state and agribusiness. In 2000, Ms. Hamilton and her family formed the Matson Halverson Christiansen Hamilton Foundation (MHCH), a not-for-profit foundation with a mission to improve the quality of life and create opportunities for growth and enterprise development in South Dakota. Ms. Hamilton holds a philosophy degree from Smith College in Northampton, Massachusetts, and an MBA in entrepreneurship from the University of Arizona. Ms. Hamilton is well qualified to serve on our board of directors because of her extensive public company board experience. Katie Ellias, joined the SAB board of directors in November 2023. Ms. Ellias serves as a Managing Director at the JDRF T1D Fund LLC, a venture philanthropy fund with approximately $200 million in assets (the “T1D Fund”), including an investment in the Company. Ms. Ellias joined the T1D Fund in 2018 where she has led a number of investments in companies developing T1D-oriented therapies, and served as a director on the board of several including, DiogenX, Veralox Therapeutics, i2O Therapeutics, and Capillary Biomedical. Ms. Ellias joined the T1D Fund from Endeavour Vision, a Geneva-based growth stage venture fund. She was previously Principal at Sofinnova Partners, Paris, a leading early-stage life sciences fund. Ms. Ellias has also held roles in business development with Medtronic and started her career at McKinsey & Company. She holds an M.B.A. in Healthcare Management from the Wharton School at the University of Pennsylvania and a B.A. in International Relations and Political Science from Yale University. Scott Giberson, RPh, MPH, D.Sc., Rear Admiral (retired), joined the SAB board of directors in July 2022. He is currently the President of AMI Expeditionary Healthcare, a private global healthcare solutions company where he has fostered global client relations at the highest levels, since March 2021. Clients include senior leadership of multiple U.S. and foreign government entities, the WHO, UN and private industry partners such as the Gates Foundation. RADM Giberson retired after 27 years as two-star admiral and as an Assistant U.S. Surgeon General, serving in a variety of senior roles with the U.S. Department of Health and Human Services from March 2010 to March 2021. RADM (rert.) Giberson served as the acting Deputy Surgeon General of the United States (2013-2014), he was the Surgeon General's principal liaison with health leadership in multiple U.S. Departments. He also held executive positions as the Senior Advisor to the Office of Surgeon General, Director of Commissioned Corps Headquarters, Chief Pharmacist of the USPHS (2010-2014), Director of the IHS National HIV/AIDS Program and Senior Public Health Advisor for Pacific Command's Center of Excellence in Disaster Management and Humanitarian Assistance (2003-2006). He served as overall Commander of the Commissioned Corps' Ebola Response in West Africa. RADM Giberson has authored numerous articles and delivered well over 100 keynote lectures on leadership, global health, and public health at numerous venues both domestically and internationally. RADM Giberson has received many awards including the Presidential Unit Citation from President Obama in the Oval Office for leadership during the West African Ebola response. The Military Officers Association of America selected him as on the of the “Top 100 Veterans in the Last 100 Years You Need to Know”. RADM Giberson is a graduate of Temple University and U. of Massachusetts/Amherst, holds a Pharmacy degree and licensure, MPH, and graduate certificate in Health Emergencies in Large Populations from the International Committee of the Red Cross. He has received three honorary Doctoral degrees (one for his pioneering work in interprofessional practice). He is also a Fellow of Wharton Business School (U. of Pennsylvania) Executive Leadership Program. Mr. Giberson is well qualified to serve on our board of directors because of his extensive experience in the medical industry. David Link, MBA , has served as a member of our board of directors since 2018 and is currently Vice-Chairman. Mr. Link is the former executive vice president and chief strategy office at Sanford Health with more than three decades of experience in strategy, planning and financial operations. During his tenure, Mr. Link contributed significantly to growing the organization from a regional health system into one of the nation’s largest non-profit, integrated health care delivery systems. He was also charged with overseeing Sanford Health Plan, Sanford Foundation and research and development, including Sanford Research. Under his leadership, the initial Sanford Clinic was created as well as the development of Sanford World Clinics, an initiative designed to provide communities around the world with permanent, sustainable health care infrastructure. Currently, Dave serves as an appointed program director in the President’s Office at Dakota State University, one of the nation’s leading programs in cyber security. Dave holds board or committee positions with Enterprise 605, the South Dakota REACH Committee, South Dakota Research and Commercialization Council and Sanford Research. In 2019, he was honored for his exemplary leadership and support of the state’s bioscience industry with the LIVE Award at the South Dakota Biotech. Dave holds a bachelor’s degree in data processing and computer science, an MBA from the University of South Dakota and a master’s in healthcare administration from the University of Minnesota. Mr. Link is well qualified to serve on our board of directors because of his extensive experience in the biotechnology industry and his extensive public company board experience. Erick Lucera , joined the SAB board of directors in April 2023. From 2020 to February 2023, Mr. Lucera served as Chief Financial Officer of AVEO Oncology, a public biotech company, and subsequent to the close of its acquisition, worked on integration with LG Chem, Ltd. From 2016 to 2020, Mr. Lucera served as Chief Financial Officer, Treasurer and Secretary of VALERITAS, a publicly traded commercial-stage medical technology company where he led multiple successful public 83 offerings. From 2017 to the present, Mr. Lucera has served as a member of the Board of Directors and Audit Committee Chairman of Beyond Air, a publicly held commercial-stage medical device and biopharmaceutical company developing a platform of nitric oxide generators and delivery systems. From 2021 to the present, Mr. Lucera has served as a member of the Board of Directors and Audit Committee Chairman of Bone Biologics Corporation, a publicly held company focusing on regenerative medicine therapies to treat bone disorders. From 2015 to 2016, Mr. Lucera served as Chief Financial Officer, Treasurer and Secretary of VIVENTIA Bio, acquired by Eleven Biotherapeutics, Inc., now Sesen Bio, a biotechnology company focused on developing targeted protein therapeutics for the treatment of cancer. Early in his career, Mr. Lucera spent more than 15 years covering healthcare and the life sciences in investment management. Given Mr. Lucera’s extensive experience in strategic planning and finance, we believe that Mr. Lucera is well qualified to serve as a member of the Board of Directors. Andrew Moin, joined the SAB board of directors in October 2023. Mr. Moin is a Partner and Analyst at Sessa Capital, a New York based investment advisor registered with the SEC. Mr. Moin has been with Sessa since 2012, where he works on idea generation, research, and investment implementation. Prior to Sessa, from 2008-2012, Mr. Moin was in the Tax Group at Sullivan & Cromwell LLP, where he advised corporate and other clients on a variety of transactions. In the non-profit realm, Andrew has served on the Young Leadership Committee of the New York City Chapter of the JDRF and was Chair of the Board of Trustees at the Great Neck Community School. Andrew received a B.A. in Economics, with distinction, from Amherst College and a J D., magna cum laude, from Harvard Law School. Dr. William J. Polvino, MD , has served as a member of our board of directors since 2019, after having served as our business advisor for several years. Dr. Polvino is pharmaceutical entrepreneur with more than 25 years of experience in the healthcare arena. He is currently chief executive officer of Bridge Medicines, a pioneering drug discovery company focused on advancing promising early technologies from concept to clinic. Prior to Bridge Medicines, Dr. Polvino was president and chief executive officer of Veloxis Pharmaceuticals A/S (NASDAQ-OMX: VELO), a public biotechnology company that deployed proprietary formulation technology to develop and commercialize an innovative oral drug product for transplant patients. He also served as president and CEO of Helsinn Therapeutics (formerly Sapphire Therapeutics) and has held executive and senior-level positions in drug development at Merck, Wyeth and Theravance. Dr. Polvino earned his medical degree from Rutgers Medical School and a B.S. in Biology from Boston College. He trained in internal medicine at Massachusetts General Hospital and was a fellow in clinical pharmacology at the National Institutes of Health prior to entering the pharmaceutical and biotechnology industry. Dr. Polvino is well qualified to serve on our board of directors because of his extensive experience in the biotechnology industry and his extensive public company management experience. Jeffrey G. Spragens has served as a member of our board of directors since November 2020. From 2005 through 2013, Mr. Spragens was a Co-Founder and the CEO of SafeStitch Medical, Inc., a medical device company that pioneered incisionless surgery techniques that helps to relieve GERD and obesity. In 2013, SafeStitch merged with TransEnterix, Inc. (NYSE: TRXC). In addition, Mr. Spragens was one of the three founding board members of North American Vaccine, which became a publicly traded company in 1990. At North American Vaccine, Mr. Spragens was responsible for securing initial financing and building a commercial manufacturing facility. Mr. Spragens was instrumental in North American Vaccine’s acquisition by Baxter International (NYSE: BAX) in 1999. Mr. Spragens has also been a successful real estate developer and entrepreneur. Mr. Spragens was President of FCH services from 1973 until 1986. FCH developed and managed units of coop and condo housing financed with HUD financing with offices in several major cities. In 1986, Mr. Spragens converted to condo ownership 1,000 apartment units in San Mateo, California, resulting in one of the largest residential projects in California at that time. Mr. Spragens was Managing Partner of Gateway Associates, Inc. from 1990 to 2000. In addition, Mr. Spragens is President and 50% owner of Mint Management Company, a residential property management company he co-founded in 1987, which develops, owns and operates apartment units in New Jersey, Michigan and Kansas. Mr. Spragens developed and continues to own and operate Inman Grove Shopping Center in Edison, New Jersey. Mr. Spragens is also a well-known and respected philanthropist. Mr. Spragens is a Founding Board Member and Treasurer of Foundation for Peace. Foundation for Peace provides healthcare, education, and clean water to those in need in Dominican Republic and Haiti. He is also a member of the Board of Directors and Finance Committee of Hernia Help, which provides free hernia surgery to underserved children and adults in developing countries. Mr. Spragens has a BA from the University of Cincinnati, a Law Degree from George Washington University, and an MA from American University. Mr. Spragens is well qualified to serve on our board of directors because of his extensive public company management and multi-sector investment experience, and his public company board experience. Director Independence The listing rules of Nasdaq require us to maintain a board of directors comprised of a majority of independent directors, as determined affirmatively by our board of directors. In addition, the Nasdaq listing rules require that, subject to specified exceptions, each member of our audit, compensation and nominating and corporate governance committees must be 84 independent. Audit committee members and compensation committee members must also satisfy the independence criteria set forth in Rule 10A-3 and Rule 10C-1, respectively, under the Exchange Act. Under the Nasdaq listing rules, a director will only qualify as an “independent director” if, in the opinion of our board of directors, the director does not have a relationship that would interfere with the exercise of independent judgment in carrying out his or her responsibilities. Our board of directors has undertaken a review of the independence of our directors and considered whether any director has a material relationship with us that could compromise his or her ability to exercise independent judgment in carrying out his or her responsibilities. Based upon information requested from and provided by each director concerning his or her background, employment and affiliations, including family relationships, our board of directors has determined that none of Christine Hamilton, Jeffrey Spragens, William Polvino, David Link, Scott Giberson, Erick Lucera, Katie Ellias, and Andrew Moin (representing eight of our ten directors), has a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that they each are an “independent director” as that term is defined under the Nasdaq listing rules. In making these determinations, our board of directors considered the relationships that each nonemployee director has with us and all other facts and circumstances our board of directors deemed relevant in determining their independence, including consulting relationships, family relationships and the beneficial ownership of our capital stock by each non-employee director. Board Composition Our business and affairs are organized under the direction of our board of directors. Our board currently consists of ten (10) directors divided into three classes as follows: • each Class I director having a term that expires immediately following our annual meeting of stockholders for the calendar year ended December 31, 2025; • each Class II director having a term that expires immediately following our annual meeting of stockholders for the calendar year ended December 31, 2026; and • each Class III director having a term that expires immediately following our annual meeting of stockholders for the calendar year ended December 31, 2024 or, in each case, until their respective successor is duly elected and qualified, or until their earlier resignation, removal or death. Messrs. Lucera, Giberson, and Dr. Polvino currently serve as the Class I directors, Ms. Ellias, Messrs. Link, Spragens and Moin currently serve as the Class II directors, and Ms. Hamilton, and Messrs. Reich and Sullivan currently serve as Class III directors. At each annual meeting of stockholders, the successors to directors whose terms then expire will serve until the third annual meeting following their election and until their successors are duly elected and qualified. The authorized size of the board of directors will be fixed exclusively by resolutions of the board of directors. The authorized number of directors may be changed only by resolution of the board of directors. Any additional directorships resulting from an increase in the number of directors will be distributed between the three classes so that, as nearly as possible, each class will consist of one-third of the directors. This classification of the board of directors may have the effect of delaying or preventing changes in its control or management. Our board of directors may be removed for cause by the affirmative vote of the holders of at least 66 2/3% of its voting stock . Board Meetings During 2023, our board of directors held six meetings, and each director attended at least 75% of the aggregate of (i) the total number of meetings of our board of directors held during the period for which he or she has been a director and (ii) the total number of meetings held by all committees of our board of directors on which he or she served during the periods that he or she served. Committees of the Board of Directors Our board of directors has three standing committees: an audit committee, a nominating and corporate governance committee (“nominating committee”) and a compensation committee. Subject to phase-in rules and a limited exception, Nasdaq rules and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be comprised solely of independent directors, and Nasdaq rules require that the compensation committee and nominating committee of a listed 85 company be comprised solely of independent directors. Each of our committees is comprised entirely of independent directors . Audit Committee On October 22, 2021, we established an audit committee of the board of directors. Erick Lucera, William Polvino, and Jeffrey Spragens serve as members of the audit committee, with Erick Lucera serving as the Chairman of the audit committee. Under the Nasdaq listing standards and applicable SEC rules, we are required to have at least three members of the audit committee, all of whom must be independent. Each of Mr. Lucera, Dr. Polvino, and Mr. Spragens meet the independent director standard under Nasdaq listing standards and under Rule 10A-3(b)(1) of the Exchange Act. The Audit Committee held five meetings during 2023. Each member of the audit committee is financially literate, and our board of directors has determined that each Mr. Lucera and Mr. Spragens qualifies as an “audit committee financial expert” as defined in applicable SEC rules. We adopted a restated audit committee charter on October 22, 2021 which details the principal functions of the audit committee, including: • the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm engaged by us; • pre-approving all audit and permitted non-audit services to be provided by the independent registered public accounting firm engaged by us, and establishing pre-approval policies and procedures; • setting clear hiring policies for employees or former employees of the independent registered public accounting firm, including but not limited to, as required by applicable laws and regulations; • setting clear policies for audit partner rotation in compliance with applicable laws and regulations; • obtaining and reviewing a report, at least annually, from the independent registered public accounting firm describing (i) the independent registered public accounting firm’s internal quality-control procedures, (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues and (iii)all relationships between the independent registered public accounting firm and us to assess the independent registered public accounting firm’s independence; • reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and • reviewing with management, the independent registered public accounting firm, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the FASB, the SEC or other regulatory authorities. Compensation Committee On October 22, 2021, we established a compensation committee of the board of directors. Christine Hamilton, Eric Lucera and Katie Ellias serve as members of the compensation committee. Christine Hamilton serves as the Chairwoman of the compensation committee. Under the Nasdaq listing standards and applicable SEC rules, we are required to have at least two members of the compensation committee, all of whom must be independent. Each of Mr. Lucera, Ms. Ellias and Ms. Hamilton are independent. The Compensation Committee held two meetings during 2023. We adopted a restated compensation committee charter on October 22, 2021, which details the principal functions of the compensation committee, including: • reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, if any is paid by us, evaluating our Chief Executive Officer’s performance considering such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation; • reviewing and approving on an annual basis the compensation, if any is paid by us, of all our other officers; • reviewing on an annual basis our executive compensation policies and plans; • implementing and administering our incentive compensation equity-based remuneration plans; 86 • assisting management in complying with our proxy statement and Form 10-K disclosure requirements; • approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees; • if required, producing a report on executive compensation to be included in our annual proxy statement; and • reviewing, evaluating, and recommending changes, if appropriate, to the remuneration for directors. Notwithstanding the foregoing, other than as indicated in this Form 10-K, no compensation of any kind, including finders, consulting, or other similar fees, will be paid to any of our existing stockholders, officers, directors, or any of their respective affiliates, prior to, or for any services they render to effectuate the offering. The charter also provides that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, legal counsel or other adviser and will be directly responsible for the appointment, compensation and oversight of the work of any such adviser. However, before engaging or receiving advice from a compensation consultant, external legal counsel or any other adviser, the compensation committee will consider the independence of each such adviser, including the factors required by Nasdaq and the SEC. Compensation Committee Interlocks and Insider Participation No person who served as a member of the compensation committee during the fiscal year ended December 31, 2023 was a current or former officer or employee of the Company or engaged in certain transactions with the Company required to be disclosed by regulations of the SEC. Additionally, there were no compensation committee “interlocks” during the fiscal year ended December 31, 2023, which generally means that no executive officer of the Company served as a director or member of the compensation committee of another entity, one of whose executive officers served as a director or member of the compensation committee of the Company. Nominating Committee On October 22, 2021, we established a nominating committee of the board of directors. David Link, Scott Giberson, and Andrew Moin currently serve as members of the Nominating and Governance Committee. David Link serves as the Chairman of the nominating committee. Under the Nasdaq listing standards and applicable SEC rules, we are required to have at least two members of the nominating committee, all of whom must be independent. Each of Mr. Link, Mr. Giberson, and Mr. Moin are independent . The Nominating Committee held two meetings during 2023. We adopted a restated nominating committee charter on October 22, 2021, which details the purpose and responsibilities of the nominating committee, including: • screening and reviewing individuals qualified to serve as directors, consistent with criteria approved by the board, and recommending to the board of directors’ candidates for nomination for election at the annual meeting of stockholders or to fill vacancies on the board of directors; • developing and recommending to the board of directors and overseeing implementation of our corporate governance guidelines; and • reviewing on a regular basis our overall corporate governance and recommending improvements as and when necessary. The nominating committee will consider several qualifications relating to management and leadership experience, background and integrity and professionalism in evaluating a person’s candidacy for membership on the board of directors. The nominating committee may require certain skills or attributes, such as financial or accounting experience, to meet specific board needs that arise from time to time and will also consider the overall experience and makeup of its members to obtain a broad and diverse mix of board members. The nominating committee does not distinguish among nominees recommended by stockholders and other persons. We have not formally established any specific, minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying and evaluating nominees for director, the board of directors considers educational background, diversity of professional experience, knowledge of our business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of our stockholders. Executive Sessions of Independent Directors Independent directors are required to meet regularly without management participation. During 2023, there were six meetings of independent directors. 87 Director Nominations The process of recommending director nominees for selection by the board of directors is undertaken by the nominating committee (see above). The board of directors will also consider director candidates recommended for nomination by our stockholders during such times as they are seeking proposed nominees to stand for election at the next annual meeting of stockholders (or, if applicable, a special meeting of stockholders). Our stockholders that wish to nominate a director for election to our board of directors should follow the procedures set forth in our bylaws. In 2023, there were no material changes have been made to the procedures by which security holders may recommend nominees to our board of directors. Section 16 Reporting Compliance Section 16(a) of the Exchange Act requires certain of our officers and our directors, and persons who own more than 10 percent of a registered class of our equity securities, to file reports of ownership and changes in ownership with the SEC. Officers, directors, and greater than 10 percent stockholders are required by SEC regulation to furnish us with copies of all Section 16(a) forms they file. Based solely on our review of copies of such forms received by us, we believe that during the year ended December 31, 2023, all filing requirements applicable to all of our officers, directors, and greater than 10% beneficial stockholders were timely complied with. Code of Ethics We adopted a restated Code of Ethics applicable to our directors, officers, and employees. A copy of our Code of Ethics and copies of our audit, nominating and compensation committee charters are available on our website at https://www.sabbiotherapeutics.com/. In addition, a copy of the Code of Ethics will be provided without charge upon written request, addressed to: SAB Biotherapeutics, Inc. 2100 East 54th Street North Sioux Falls, South Dakota 57104 Attn: Corporate Secretary We intend to disclose any amendments to or waivers of certain provisions of our Code of Ethics in a Current Report on Form 8-K. Please see “ Where You Can Find Additional Information ” for additional information. Board Oversight of Risk The Board’s Role The Board’s role in the Company’s risk oversight process includes receipt and review of scheduled and ad hoc reports from members of the executive management team which relate to areas of actual or potential material risk to the Company, including but not limited to, operational, financial, legal, regulatory, strategic, transactional and reputational risks. The full Board receives these reports from the appropriate “risk owner” within the organization to enable each member of the Board to understand our risk identification, risk management and risk mitigation strategies. Risk Assessment in Compensation Policies and Practices for Employees The Compensation Committee reviewed the elements of our compensation policies and practices for all of our employees, including our named executive officers, to evaluate whether risks that may arise from such compensation policies and practices are reasonably likely to have a material adverse effect on our Company. The Compensation Committee has concluded that the following current features of our compensation programs guard against excessive risk-taking: • compensation programs provide a balanced mix of short-term and longer-term incentives; • base salaries are consistent with employees’ duties and responsibilities; • cash incentive awards are capped by the Compensation Committee; • cash incentive awards are tied to corporate performance goals, as well as individual performance goals; 88 • vesting periods for equity awards encourage executives to focus on sustained stock price appreciation; • our clawback policy provides our Board the ability to recoup any erroneously awarded performance-based compensation from executive officers on account of intentional misconduct; and • our robust stock ownership guidelines for executive officers provide alignment with stockholder interests. The Compensation Committee believes that, for all of our employees, including our named executive officers, our compensation programs do not lead to excessive risk-taking and instead encourage behavior that supports sustainable value creation. We believe that risks that may arise from our compensation policies and practices for our employees, including our named executive officers, are not reasonably likely to have a material adverse effect on our Company. Item 11. Executive Compensation. The following is a discussion and analysis of compensation arrangements of the Company’s named executive officers. This discussion may contain forward-looking statements that are based on the Company’s current plans, considerations, expectations and determinations regarding future compensation programs. The actual compensation programs that the Company adopts may differ materially from the currently planned programs that are summarized in this discussion. As an “emerging growth company” as defined in the JOBS Act, we are not required to include a Compensation Discussion and Analysis section and have elected to comply with the scaled disclosure requirements applicable to emerging growth companies. Summary Executive Compensation Table The following table sets forth information regarding the compensation awarded to, earned by or paid to Our named executive officers for the fiscal years ended December 31, 2023 and 2022. Salary Option Awards (1) Stock Awards (2) Non-Equity Incentive Plan Compensation All Other Compensation Total Name and Principal Position Year ($) ($) ($) ($) ($) ($) Samuel J. Reich (3) 2023 350,000 202,598 — — 13,200 565,798 Chairman of the Board of Directors and Chief Executive Officer 2022 350,000 304,600 — 14,000 12,200 680,800 Eddie J. Sullivan, PhD. (4) 2023 377,200 202,598 — — 25,359 605,157 President 2022 377,200 44,725 — 42,435 10,982 475,342 Alexandra Kropotova, MD (5) 2023 525,000 — 147,125 236,250 13,200 921,575 EVP, Chief Medical Officer 2022 282,692 10,344 567,000 — 2,423 862,459 Michael G. King, Jr. (6) 2023 60,577 661,411 — — — 721,988 EVP, Chief Financial Officer 2022 — — — — — — Christoph Bausch, PhD (7) 2023 325,000 106,123 — 105,000 13,200 549,323 EVP, Chief Operating Officer 2022 308,855 184,551 — 50,445 12,200 556,051 (1) Represents the aggregate grant date fair value of stock option awards granted in the respective fiscal year as computed in accordance with FASB ASC Topic 718, Compensation — Stock Compensation . The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option valuation model. A discussion of the assumptions used in calculating the amounts in this column may be found in the Notes to our consolidated financial statements for the year ended December 31, 2023 set forth in this Annual Report. These amounts do not represent the actual amounts paid to or realized by the executives during the fiscal years presented . (2) Represents the aggregate grant date fair value of restricted stock units granted in the respective fiscal year as computed in accordance with FASB ASC Topic 718, Compensation — Stock Compensation. Restricted stock units are valued at market price of the Company’s common stock at the closing price at the date of grant. These amounts do not represent the actual amounts paid to or realized by the executives during the fiscal years presented . (3) We granted Mr. Reich a stock option to purchase up to 7,000 shares of our common stock at an exercise price of $1.78 per share, the closing price of our common stock on March 16, 2022. The shares subject to this stock option award 89 vested 100% of the shares on the one-year anniversary of the grant date and We granted Mr. Reich a stock option to purchase up to 525,000 shares of our common stock at an exercise price of $0.71 per share, the closing price of our common stock on September 13, 2022. The shares subject to this stock option will vest as to 25% of the shares one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. We granted Mr. Reich a stock option to purchase up to 525,000 shares of our common stock at an exercise price of $0.54 per share, the closing price of our common stock on March 14, 2023. The shares subject to this stock option will vest as to 25% of the shares one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. “All Other Compensation” includes only employer matching contributions under our 401(k) plan. (4) We granted Dr. Sullivan a stock option to purchase up to 21,218 shares of our common stock at an exercise price of $1.78 per share, the closing price of our common stock on March 16, 2022. The shares subject to this stock option award vested 100% on the one-year anniversary of the grant date. We granted Dr. Sullivan a stock option to purchase up to 35,000 shares of our common stock at an exercise price of $0.71 per share, the closing price of our common stock on September 13, 2022. The shares subject to this stock option vest 25% one the one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. We granted Dr. Sullivan a stock option to purchase up to 525,000 shares of common stock at an exercise price of $0.54 per share, the closing price of our common stock on March 14, 2023. The shares subject to this stock option vest 25% one the one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. “All Other Compensation” includes (a) $13,173 representing payment for a lease to occupy an apartment in Sioux Falls, South Dakota, and (b) $12,187 representing employer matching contributions under our 401(k) plan. (5) On June 6, 2022 we granted Alexandra Kropotova 300,000 restricted shares of our common stock (“RSUs”). The shares subject to this stock award will vest as to 25% of the RSU’s on the one-year anniversary of the grant date, and the remainder of the RSU’s vest in 36 equal monthly installments thereafter. On March 14, 2023 we granted Dr. Kropotova 275,000 (27,500 shares following the Reverse Stock Split) restricted shares of our common stock (“RSUs”). The shares subject to this stock award will vest as to 25% of the RSU’s on the one-year anniversary of the grant date, and the remainder of the RSU’s vest 36 equal monthly installments thereafter. “All Other Compensation” includes only employer matching contributions under our 401(k) plan. (6) We granted Mr. King a stock option to purchase up to 850,000 shares of our common stock at an exercise price of $0.798 per share, the closing price of our common stock on October 19, 2023. The award was contingent upon the Mr. King's commencement of service as Chief Financial Officer of the Registrant, which occurred on October 30, 2023. The shares subject to this stock option vest 25% one the one-year anniversary of Mr. King’s commencement of service as Chief Financial Officer , and vest as to the remainder of the shares in 36 equal monthly installments thereafter. (7) We granted Dr. Bausch a stock option to purchase up to 24,972 shares of our common stock at an exercise price of $1.78 per share, the closing price of our common stock on March 16, 2022. The shares subject to this stock option award vested 100% on the one-year anniversary of the grant date. We granted Dr. Bausch a stock option to purchase up to 274,875 shares of our common stock at an exercise price of $0.71 per share, the closing price of our common stock on September 13, 2022. The shares subject to this stock option vest 25% one the one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. We granted Dr. Bausch a stock option to purchase up to 275,000 shares of common stock at an exercise price of $0.54 per share, the closing price of our common stock on March 14, 2023. The shares subject to this stock option vest 25% one the one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. “All Other Compensation” includes only employer matching contributions under our 401(k) plan. 90 Outstanding Equity Awards at Fiscal 2023 Year-End The following table sets forth information regarding outstanding equity awards held by our named executive officers as of December 31, 2023. Option Awards Stock Awards Name Number of Securities Underlying Unexercised Options (#) Exercisable Number of Securities Underlying Unexercised Options (#) Unexercisable Option Exercise Price ($) Option Expiration Date Number of Shares or Units of Stock That Have Not Vested (#) Exercisable Market Value of Shares or Units of Stock That Have Not Vested ($) Samuel J. Reich 25,277 9,723 (1) 111.70 11/16/2031 — — 700 — 17.80 3/15/2032 — — 16,406 36,094 (2) 7.11 9/12/2032 — — — 52,500 (3) 5.35 3/13/2033 — — Eddie J. Sullivan, PhD. 13,958 — 5.40 8/4/2024 — — 32,570 — 5.40 12/11/2024 — — 2,326 — 26.90 4/26/2030 — — 2,121 — 17.80 3/15/2032 — — 1,093 2,407 (4) 7.11 9/12/2032 — — — 52,500 (5) 5.35 3/13/2033 — — Alexandra Kropotova, MD 573 1,259 (6) 7.11 9/12/2032 — — — — — — 18,750 (7) 128,906 — — — — 27,500 (7) 189,063 Michael G. King, Jr. — 85,000 (8) 7.98 11/1/2033 — — Christoph Bausch, PhD 10,468 — 10.70 3/12/2027 — — 8,142 — 10.70 3/12/2027 — — 6,979 — 10.70 3/12/2028 — — 1,163 — 26.90 4/26/2030 — — 2,497 — 17.80 3/15/2032 — — 8,589 18,898 (9) 7.11 9/12/2032 — — — 27,500 (10) 5.35 3/13/2033 — — (1) The shares subject to this stock option award will vest as to 33% of the shares on one-year anniversary of the grant date, and vest as to the remainder of the shares in 24 equal monthly installments thereafter. (2) The shares subject to this stock option award will vest as to 25% of the shares on one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. (3) The shares subject to this stock option award will vest as to 25% of the shares on one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. (4) The shares subject to this stock option award will vest as to 25% of the shares on one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. (5) The shares subject to this stock option award will vest as to 25% of the shares on one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. (6) The shares subject to this stock option award will vest as to 25% of the shares on one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. (7) Shares subject to these stock awards vest as to 25% of the RSU’s on the one-year anniversary of the grant date, and the remainder of the RSU’s in 36 equal monthly installments thereafter. (8) The shares subject to this stock option award will vest as to 25% of the shares on one-year anniversary of Mr. King’s commencement of service as Chief Financial Officer of the Registrant, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. (9) The shares subject to this stock option award will vest as to 25% of the shares on one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. (10) The shares subject to this stock option award will vest as to 25% of the shares on one-year anniversary of the grant date, and vest as to the remainder of the shares in 36 equal monthly installments thereafter. 91 Named Executive Officer Employment Arrangements Below are descriptions of the current employment agreements with our named executive officers. Samuel J. Reich On November 17, 2021, we entered into an Executive Employment Agreement with Mr. Reich to serve as our Chairman of the Board of Directors. The agreement provides Mr. Reich an annual base salary of $350,000, and his eligibility to participate in the Company’s benefit plans generally. The agreement also subjects Mr. Reich to standard nondisclosure, invention assignment, and arbitration provisions. If Mr. Reich's employment is terminated by the Company without Cause (as defined in the employment agreement) (other than for death or disability) or the term of his employment is not renewed, Mr. Reich will receive (i) a severance payment equal to one year of his then base salary, payable in a lump sum five business days after his release becomes final, (ii) the applicable accrued but unpaid annual bonus, if any, for the fiscal year ended prior to his date of termination, payable at the same time annual bonuses for such fiscal year are paid to other key executives of the Company, (iii) one hundred percent of his outstanding unvested equity awards as of the date of termination will be fully vested and exercisable, and (iv) reimbursement of the COBRA premiums, if any, for continuation coverage for Mr. Reich, his spouse and dependents under the Company’s group health, dental and vision plans for a twelve month period from the date of termination . Eddie J. Sullivan On March 5, 2024, we entered into an Executive Employment Agreement with Dr. Sullivan to continue to serve as our President. The agreement provides Dr. Sullivan an annual base salary of $485,000, and his eligibility to participate in the Company’s benefit plans generally. The agreement also subjects Dr. Sullivan to standard nondisclosure, invention assignment, and arbitration provisions. If Dr. Sullivan’s employment is terminated by the Company without Cause (as defined in the employment agreement) (other than for death or disability) or the term of his employment is not renewed, Dr. Sullivan will receive: (i) a severance payment equal to one year of his then base salary, payable in a lump sum five business days after his release becomes final, (ii) the applicable accrued but unpaid annual bonus, if any, for the fiscal year ended prior to his date of termination, payable at the same time annual bonuses for such fiscal year are paid to other key executives of the Company, (iii) one hundred percent of his outstanding unvested equity awards as of the date of termination will be fully vested and exercisable, and (iv) reimbursement of the COBRA premiums, if any, for continuation coverage for Dr. Sullivan, his spouse and dependents under the Company’s group health, dental and vision plans for a twelve month period from the date of termination. Alexandra Kropotova On May 20, 2022, we entered into an Executive Employment Agreement with Dr. Kropotova to serve as our Executive Vice President – Chief Medical Officer. The agreement provides Dr. Kropotova an annual base salary of $525,000, and her eligibility to participate in the Company’s benefit plans generally. The agreement also subjects Dr. Kropotova to standard nondisclosure, invention assignment, and arbitration provisions. If Dr. Kropotova’s employment is terminated by the Company without Cause (as defined in the employment agreement) (other than for death or disability) or the term of her employment is not renewed, Dr. Kropotova will receive: (i) a severance payment equal to one year of her then base salary, payable in a lump sum five business days after his release becomes final, (ii) the applicable accrued but unpaid annual bonus, if any, for the fiscal year ended prior to her date of termination, payable at the same time annual bonuses for such fiscal year are paid to other key executives of the Company, (iii) one hundred percent of her outstanding unvested equity awards as of the date of termination will be fully vested and exercisable, and (iv) reimbursement of the COBRA premiums, if any, for continuation coverage for Dr. Kropotova, her spouse and dependents under the Company’s group health, dental and vision plans for a six month period from the date of termination. Michael G. King, Jr. On October 23, 2023, we entered into an Executive Employment Agreement with Mr. King to serve as our Executive Vice President – Chief Financial Officer. The agreement provides Mr. King an annual base salary of $450,000, and his eligibility to participate in the Company’s benefit plans generally. The agreement also subjects Mr. King to standard nondisclosure, invention assignment, and arbitration provisions. If Mr. King’s employment is terminated by the Company without Cause (as defined in the employment agreement) (other than for death or disability) or the term of his employment is not renewed, Mr. King will receive: (i) a severance payment equal to one year of his then base salary, payable in a lump sum five business days after his release becomes final, (ii) the applicable accrued but unpaid annual bonus, if any, for the fiscal year ended prior to her date of termination, payable at the same time annual bonuses for such fiscal year are paid to other key executives of the Company, (iii) fifty percent of his outstanding unvested equity awards as of the date of termination will be fully vested and 92 exercisable, and (iv) reimbursement of the COBRA premiums, if any, for continuation coverage for Mr. King, his spouse and dependents under the Company’s group health, dental and vision plans for a six month period from the date of termination. Christoph Bausch On March 5, 2024, we entered into an Executive Employment Agreement with Dr. Bausch to continue to serve as our Chief Operating Officer. The agreement provides Dr. Bausch an annual base salary of $425,000, and his eligibility to participate in the Company’s benefit plans generally. The agreement also subjects Dr. Bausch to standard nondisclosure, invention assignment, and arbitration provisions. If Dr. Bausch’s employment is terminated by the Company without Cause (as defined in the employment agreement) (other than for death or disability) or the term of his employment is not renewed, Dr. Bausch will receive: (i) a severance payment equal to one year of his then base salary, payable in a lump sum five business days after his release becomes final, (ii) the applicable accrued but unpaid annual bonus, if any, for the fiscal year ended prior to his date of termination, payable at the same time annual bonuses for such fiscal year are paid to other key executives of the Company, (iii) one hundred percent of his outstanding unvested equity awards as of the date of termination will be fully vested and exercisable, and (iv) reimbursement of the COBRA premiums, if any, for continuation coverage for Dr. Bausch, his spouse and dependents under the Company’s group health, dental and vision plans for a twelve month period from the date of termination. Summary Director Compensation Table The following table sets forth information regarding the compensation awarded to, earned by or paid to our directors for the fiscal year ended December 31, 2023. Fees Earned or Paid in Cash Option Awards (1) Stock Awards (2) Total Name ($) ($) ($) ($) Samuel J. Reich — 202,598 — 202,598 Christine Hamilton, MBA 25,000 — — 25,000 Eddie J. Sullivan, PhD — 202,598 — 202,598 Jeffrey G. Spragens 25,000 — — 25,000 David Link, MBA 25,000 — — 25,000 Katie Ellias — — — — William Polvino, MD 25,000 — — 25,000 Scott Giberson 25,000 — — 25,000 Erick Lucera 18,750 8,178 — 26,928 Andrew Moin — — — — (1) Represents the aggregate grant date fair value of stock option awards granted in the respective fiscal year as computed in accordance with FASB ASC Topic 718, Compensation — Stock Compensation . The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option valuation model. A discussion of the assumptions used in calculating the amounts in this column may be found in the Notes to our audited consolidated financial statements for the year ended December 31, 2023 set forth in this Form 10-K. These amounts do not represent the actual amounts paid to or realized by the executives during the fiscal years presented. (2) Represents the aggregate grant date fair value of restricted stock units granted in the respective fiscal year as computed in accordance with FASB ASC Topic 718, Compensation — Stock Compensation. Restricted stock units are valued at market price of the Company’s common stock at the closing price at the date of grant. These amounts do not represent the actual amounts paid to or realized by the executives during the fiscal years presented. Narrative to Director Compensation Table Our director compensation policy is intended to provide a total compensation package that enables us to attract and retain qualified and experienced individuals to serve as directors and to align our directors’ interests with those of our stockholders. Annual Cash Compensation The annual retainers payable to non-employee directors for service on the Board and its committees are $25,000 for service on the Board. 93 Inaugural Equity Grants Each non-employee director who joins the board receives an equity award of an option to purchase 25,000 shares of our common stock, which vests monthly over a three-year period beginning one month from the date of grant. SAB Biotherapeutics 2021 Equity Incentive Plan The SAB Biotherapeutics 2021 Equity Incentive Plan (the “Incentive Plan”) was adopted in connection with, and become effective at the closing of, the Business Combination. Summary of the Incentive Plan General The Incentive Plan covers the grant of awards to our employees (including officers), non-employee consultants and non-employee directors and those of our affiliates. For purposes of the Incentive Plan, our affiliates include any corporation, partnership, limited liability company, joint venture or other entity, with respect to which we, directly or indirectly, own either (i) stock possessing more than fifty percent (50%) of the total combined voting power of all classes of stock entitled to vote, or more than fifty percent (50%) of the total value of all shares of all classes of stock of such corporation, or (ii) an aggregate of more than fifty percent (50%) of the profits interest or capital interest of any non-corporate entity. The compensation committee administers the Incentive Plan. The full Board must approve all decisions regarding awards to non-employee directors. Up to a maximum of 1,600,000 shares of our common stock (as adjusted following the Reverse Stock Split) may be delivered in settlement of awards granted under the Incentive Plan initially. The number of shares authorized for issuance will increase each fiscal year, beginning fiscal year 2022 and occurring each year thereafter through 2031, by 2.0% of the number of our shares of common stock issued and outstanding on a fully-diluted basis as of the last day of the preceding fiscal year (such lesser number of shares as determined by our board of directors in its sole discretion). In no event, however, shall the aggregate number of shares that may be issued pursuant to this annual increase under the Incentive Plan exceed 500,000. Up to a maximum of 1,600,000 shares of our common stock (as adjusted following the Reverse Stock Split) may be issued under the Incentive Plan pursuant to the exercise of incentive stock options. The stock delivered to settle awards made under the Incentive Plan may be authorized and unissued shares or treasury shares, including shares repurchased by us for purposes of the Incentive Plan. If any shares subject to any award granted under the Incentive Plan (other than a substitute award as described below) is forfeited or otherwise terminated without delivery of such shares (if such shares are returned to us due to a forfeiture restriction under such award), the shares subject to such awards will again be available for issuance under the Incentive Plan. However, any shares that are withheld or applied as payment for shares issued upon exercise of an award or for the withholding or payment of taxes due upon exercise of an award will continue to be treated as having been delivered under the Incentive Plan and will not again be available for grant under the Incentive Plan. Upon settlement of any stock appreciation rights (“SARs”), the number of shares underlying the portion of the SARs that is exercised will be treated as having been delivered for purposes of determining the maximum number of shares available for grant under the Incentive Plan and shall not again be treated as available for issuance under the Incentive Plan. If a dividend or other distribution (whether in cash, shares of common stock or other property), recapitalization, forward or reverse stock split, subdivision, consolidation or reduction of capital, reorganization, merger, consolidation, scheme of arrangement, split-up, spin-off or combination involving us or repurchase or exchange of our shares or other securities, or other rights to purchase shares of our securities or other similar transaction or event affects our common stock such that the compensation committee determines that an adjustment is appropriate in order to prevent dilution or enlargement of the benefits (potential benefits) provided to grantees under the Incentive Plan, the compensation committee will make an equitable change or adjustment as it deems appropriate to the number of type of securities with respect to which awards may be granted, (ii) the number and type of securities subject to outstanding awards, (iii) the exercise price with respect to any option or SAR or, if deemed appropriate, make provision for a cash payment to the holder of such outstanding award, and (iv) the number and kind of outstanding restricted shares, or the shares underlying any other form of award. Types of Awards The Incentive Plan permits the granting of any or all of the following types of awards to all grantees: • stock options, including incentive stock options, or ISOs; • stock appreciation rights, or SARs; • restricted shares; 94 • deferred stock; • restricted stock units; • performance units and performance shares; • dividend equivalents; • bonus shares; and • other stock-based awards. Generally, awards under the Incentive Plan are granted for no consideration other than prior and future services. Awards granted under the Incentive Plan may, in the discretion of the committee, be granted alone or in addition to, in tandem with or in substitution for, any other award under the Incentive Plan; provided, however, that if an SAR is granted in tandem with an ISO, the SAR and ISO must have the same grant date and term and the exercise price of the SAR may not be less than the exercise price of the ISO. The material terms of each award will be set forth in a written award agreement between the grantee and us. Stock Options and SARs The committee is authorized to grant SARs and stock options (including incentive stock options (ISOs) except that an ISO may only be granted to an employee of ours or one of our subsidiary corporations). A stock option allows a grantee to purchase a specified number of shares of our common stock at a predetermined price per share (the “exercise price”) during a fixed period measured from the date of grant. An SAR entitles the grantee to receive the excess of the fair market value of a specified number of shares on the date of exercise over a predetermined exercise price per share. The exercise price of an option or an SAR will be determined by the committee and set forth in the applicable award agreement, but the exercise price may not be less than the fair market value of a share of common stock on the grant date. The term of each option or SAR is determined by the committee and set forth in the applicable award agreement, except that the term may not exceed ten (10) years (five (5) years if the grantee holds more than 10% of the total combined voting power of all classes of our capital stock). Options may be exercised by payment of the purchase price through one or more of the following means: payment in cash (including personal check or wire transfer); delivering shares of our common stock previously owned by the grantee; or, with the approval of the compensation committee, (i) delivery of shares of our common stock acquired upon the exercise of such options, or (ii) the sale of shares acquired upon exercise of the options through a broker-dealer to whom the grantee has delivered irrevocable notice of exercise and instructions to deliver sales proceeds sufficient to pay us the exercise price. Following shareholder approval of the Incentive Plan on October 20, 2021, ISOs may be granted pursuant to the terms of the Incentive Plan. Restricted Shares The committee may award restricted shares consisting of shares of our common stock which remain subject to a risk of forfeiture and may not be disposed of by grantees until certain restrictions established by the committee lapse. The vesting conditions may be service-based (i.e., requiring continuous service for a specified period) or performance-based (i.e., requiring achievement of certain specified performance objectives) or both. A grantee receiving restricted shares will have all of the rights of a stockholder, including the right to vote the shares and the right to receive any dividends, except as otherwise provided in the applicable award agreement. Upon termination of the grantee’s affiliation with us during the restriction period (or, if applicable, upon the failure to satisfy the specified performance objectives during the restriction period), the restricted shares will be forfeited as provided in the applicable award agreement. Deferred Stock and Restricted Stock Units The committee may also grant deferred stock awards and/or restricted stock unit awards. A deferred stock award is the grant of a right to receive a specified number of shares of our common stock at the end of specified deferral periods or upon the occurrence of a specified event, which satisfies the requirements of Section 409A of the Internal Revenue Code. A restricted stock unit award is the grant of a right to receive a specified number of shares of our common stock upon lapse of a specified forfeiture condition (such as completion of a specified period of service or achievement of certain specified performance objectives). If the service condition and/or specified performance objectives are not satisfied during the restriction period, the award will lapse without the issuance of the shares underlying such award. Restricted stock units and deferred stock awards carry no voting or other rights associated with stock ownership until the shares underlying the award are delivered in settlement of the award. Unless otherwise determined by the compensation committee, grantees will have the rights to receive dividend equivalents in respect of deferred stock and/or restricted stock units, which dividend equivalents shall be deemed reinvested in additional shares of deferred stock or restricted stock units, 95 as applicable, which shall remain subject to the same forfeiture conditions applicable to the deferred stock or restricted stock units to which such dividend equivalents relate. Performance Units The committee may grant performance units, which entitle a grantee to cash or shares conditioned upon the fulfillment of certain performance conditions and other restrictions as specified by the committee and reflected in the applicable award agreement. The initial value of a performance unit will be determined by the committee at the time of grant. The committee will determine the terms and conditions of such awards, including performance and other restrictions placed on these awards, which will be reflected in the applicable award agreement. Performance Shares The committee may grant performance shares, which entitle a grantee to a certain number of shares of common stock, conditioned upon the fulfillment of certain performance conditions and other restrictions as specified by the committee and reflected in the applicable award agreement. The committee will determine the terms and conditions of such awards, including performance and other restrictions placed on these awards, which will be reflected in the applicable award agreement. Bonus Shares The committee may grant fully vested shares of our common stock as bonus shares on such terms and conditions as specified in the applicable award agreement. Dividend Equivalents The committee is authorized to grant dividend equivalents, which provide a grantee the right to receive payment equal to the dividends paid on a specified number of shares of our common stock. Dividend equivalents may be paid directly to grantees or may be deferred for later delivery under the Incentive Plan. If deferred, such dividend equivalents may be credited with interest or may be deemed to be invested in shares of our common stock, other awards under the Incentive Plan or in other property. Other Stock-Based Awards The Incentive Plan authorizes the committee to grant awards that are valued in whole or in part by reference to or otherwise based on certain other securities. The committee determines the terms and conditions of such awards, including whether awards are paid in shares or cash. Business Combination, Consolidation or Similar Corporate Transaction If there is a merger or consolidation of us with or into another corporation or a sale of substantially all of our stock (a “Corporate Transaction”), and the outstanding awards are not assumed by surviving company (its parent company) or replaced with equivalent awards granted by the surviving company(its parent company),the committee will cancel any outstanding awards that are not vested and nonforfeitable as of the consummation of such Corporate Transaction (unless the committee accelerates the vesting of any such awards) and with respect to any vested and nonforfeitable awards, the committee may either (i) allow all grantees to exercise options and SARs within a reasonable period prior to the consummation of the Corporate Transaction and cancel any outstanding options or SARs that remain unexercised upon consummation of the Corporate Transaction, or (ii) cancel any or all of such outstanding awards (including options and SARs) in exchange for a payment (in cash, or in securities or other property) in an amount equal to the amount that the grantee would have received (net of the exercise price with respect to any options or SARs) if the vested awards were settled or distributed or such vested options and SARs were exercised immediately prior to the consummation of the Corporate Transaction. If an exercise price of an option or SAR exceeds the fair market value of our common stock and the option or SAR is not assumed or replaced by the surviving company(its parent company),such options and SARs will be cancelled without any payment to the grantee. Amendment to and Termination of the Incentive Plan The Incentive Plan may be amended, altered, suspended, discontinued or terminated by our board of directors without further stockholder approval, unless such approval is required by law or regulation or under the rules of any stock exchange or automated quotation system on which our common stock is then listed or quoted. Thus, stockholder approval will not necessarily be required for amendments which might increase the cost of the Incentive Plan or broaden eligibility. Stockholder approval will not be deemed to be required under laws or regulations that condition favorable treatment of grantees on such approval, although our board of directors may, in its discretion, seek stockholder approval in any circumstance in which it deems such approval advisable. 96 In addition, subject to the terms of the Incentive Plan, no amendment or termination of the Incentive Plan may materially and adversely affect the right of a grantee under any award granted under the Incentive Plan. Unless earlier terminated by our board of directors, the Incentive Plan will terminate when no shares remain reserved and available for issuance or, if earlier, on the tenth anniversary of the effective date of the Incentive Plan. SAB Biotherapeutics 2021 Employee Stock Purchase Plan The SAB Biotherapeutics 2021 Employee Stock Purchase Plan, (the “ESPP”) was adopted in connection with, and became effective at the closing of, the Business Combination. The ESPP provides eligible employees an opportunity to purchase shares of common stock at a discount through accumulated contributions of their earned compensation. The ESPP’s initial share reserve is one million shares of SAB Biotherapeutics common stock. Offering periods will not commence under the ESPP until determined by the board of directors or compensation committee. Summary of the Employee Stock Purchase Plan Administration The ESPP is administered by the board of directors, or a committee appointed by the board of directors, which may be the compensation committee. The board of directors or committee administering the ESPP (the “Administrator”) has authority to construe and interpret the ESPP and to establish rules and regulations for the administration of the ESPP. Eligibility Eligible employees of the Company or a participating subsidiary may participate in the ESPP. One is an eligible employee for an accumulation period if he or she is an employee of the Company or a participating subsidiary both on the date determined by the ESPP administrator that enrollment forms must be received for an accumulation period and on the first day of the accumulation period. Notwithstanding the preceding sentences, an employee is not eligible to participate in the ESPP if on the first day of the accumulation period (1) such employee is a member of a collective bargaining unit whose benefits were the subject of good faith bargaining; (2) such employee is customarily employed 20 or less hours per week or five months or less per year; or (3) such employee is an employee of a participating subsidiary who is a resident of a foreign jurisdiction and (i) participation is prohibited under the laws of such foreign jurisdiction or (ii) compliance with the laws of such foreign jurisdiction would violate Section 423 of the Code. An employee is also not eligible to participate if immediately after any purchase of shares under the ESPP, the employee would own capital stock of the Company and/or hold outstanding options to purchase such stock constituting five percent (5%) or more of the total combined voting power or value of all classes of the capital stock of the Company or of any subsidiary of the Company. As of December 31, 2023, the Company had approximately 57 employees that would be eligible to participate in the ESPP. Shares Available for Issuance As noted above, the maximum aggregate number of shares of Company stock that may be issued under the ESPP is one million shares. Enrollment Dates, Accumulation Periods and Purchase Dates The accumulation periods under the ESPP will generally be a specified one-year period, or such other period, not to exceed twenty-seven (27) months, as determined by the Administrator. The first trading day of each accumulation period is the enrollment date, which is the date as of which eligible employees are granted contractual rights to purchase shares of Company stock under the ESPP. Payroll deductions may be made during the accumulation period by eligible employee selecting to participate as described below. The last trading day of each accumulation period will be the Company stock purchase date (unless the Administrator selects a different date) and on such date any contractual rights remaining outstanding will be deemed to be exercised and shares of Company stock will be purchased, as described below. Participation in the ESPP An eligible employee may become a participant in the ESPP by submitting an enrollment form, and payroll deductions for such employee will begin as soon as administratively feasible after such form is received in good order, subject to compliance with such policies, rules and procedures as we may establish in connection therewith. As of each purchase date (which is the last trading day of an accumulation period as stated above), an employee’s payroll deductions made during the accumulation period and not withdrawn by the employee or otherwise paid to the employee are used to buy shares of Company stock. The per share purchase price on the purchase date is 85% of the lower of (1) the fair 97 market value of a share of Company stock on the purchase date, or (2) the fair market value of a share of Company stock on the first trading day of the accumulation period. An employee will not be permitted to purchase more than 25,000 shares of Company stock on any purchase date, or such lower maximum number as may be determined by the Administrator. An employee’s right to purchase shares under the ESPP in any calendar year cannot exceed $25,000, as measured by the fair market value of such shares (determined for each accumulation period as of the first trading day of the accumulation period). An employee can invest any amount from 1% to 15% of his or her base earnings in Company stock through payroll deductions under the ESPP. Payroll deductions are credited to recordkeeping accounts. No earnings are credited to the accounts. Withdrawal from the ESPP, Cessation of Payroll Deductions, Mandatory Cessation of Participation An employee may withdraw from the ESPP in full (but not in part) during any accumulation period by delivering a notice of withdrawal to us (in a manner prescribed by the Administrator) at any time prior to the first day of the last calendar month immediately preceding the purchase date for such accumulation period, or at such shorter time in advance of the purchase date as the Administrator may permit. If notice of withdrawal is timely received, all funds then accumulated in the employee’s account will not be used to purchase shares, but will instead be distributed to the employee as soon as administratively practical, and the employee’s payroll deductions will cease as soon as administratively practical. An employee also may cease payroll deductions as of the last day of any month during an accumulation period by delivering a notice of cessation to us at the time and in the manner prescribed by the Administrator. Unless the employee also withdraws from the ESPP as described in the preceding paragraph, the employee’s accumulated payroll deductions will be applied to purchase shares of Company stock on the purchase date as described above. Participation in the ESPP immediately terminates when an employee ceases to be an eligible employee for any reason, including voluntary or involuntary termination of employment. Upon the termination of an employee’s participation in the ESPP, all accumulated payroll deductions of the employee will be returned to the employee. Amendment and Termination The board of directors or the compensation committee may amend or alter any provision of the ESPP and may terminate the ESPP at any time. Under certain circumstances, an amendment to the ESPP may require the approval of our stockholders. In addition, if the ESPP is amended to change the aggregate number of shares issuable thereunder or the provisions regarding eligible employees, certain tax advantages under the Code as discussed below (see “Certain Federal Income Tax Consequences Relating to the ESPP”) will only continue if we obtain stockholder approval of such amendment. Certain amendments to the ESPP may be made by the Administrator without stockholder approval. In the event of any Company reorganization, recapitalization, stock split, reverse stock split, stock dividend, combination of shares, merger, consolidation, acquisition of property or shares, separation, asset spin-off, stock rights offering, liquidation or other similar change in the capital structure of the Company, the shares subject to an employee’s election to purchase Company stock during an accumulation period will be adjusted and the aggregate number and kind of shares available under the ESPP and the purchase price of shares will also be adjusted, in each case to the extent deemed appropriate by the Administrator. Generally, if a dissolution or liquidation of the Company occurs during an accumulation period, any rights an employee has to acquire Company stock under the ESPP will be terminated, but an employee will have the right to acquire Company stock before the dissolution or liquidation. Certain Federal Income Tax Consequences Relating to the ESPP The following summary of the income tax consequences of the ESPP is based on current provisions of the Code and regulations thereunder. The summary does not address tax rates or state or local income taxes or taxes in jurisdictions other than the United States, nor does it address employment tax. Enrollment or Purchase of Company Stock under the ESPP . No federal income tax consequences arise at the time of an employee’s enrollment in the ESPP or upon the purchase of Company stock under the ESPP. However, as discussed below, if an employee disposes of Company stock acquired under the ESPP, such employee will have the federal income tax consequences described below in the year such employee disposes of the stock. Amounts withheld by payroll deduction are subject to federal income tax as though those amounts had been paid in cash. Whenever an employee transfers any shares of Company stock in a manner which may constitute a disposition, such employee must promptly advise the Secretary of the Company of the facts concerning that transfer. Early Dispositions . If an employee disposes of Company stock purchased under the ESPP within two years after the first trading day of an accumulation period or within one year after the shares of Company stock are transferred to such employee 98 or to an account in such employee’s name (the “Tax Holding Period”), such employee will recognize compensation income in the year of disposition in an amount equal to the excess of (A) the lesser of the fair market value of the Company stock on the purchase date or the proceeds from the sale or exchange of the shares over (B) the price such employee paid for the Company stock. The Company must report such compensation as taxable ordinary income to the Internal Revenue Service on such employee’s annual Form W-2.The amount, if any, that is taxable as ordinary income is added to the purchase price and becomes part of the cost basis for that Company stock for federal income tax purposes. If the disposition of the Company stock involves a sale or exchange, such employee generally may also realize a short-term capital gain or loss equal to the difference between such employee’s cost basis (calculated pursuant to the preceding sentence)and the proceeds from the sale or exchange of the shares. Later Dispositions . If an employee disposes of Company stock purchased under the ESPP on a date after the Tax Holding Period, or if such employee dies at any time while owning Company stock, such employee (such employee’s estate) will have included in such employee’s compensation as taxable ordinary income in the year of disposition or death, an amount equal to the lesser of (1) the excess of the fair market value of the Company stock on the first trading day of the accumulation period over the purchase price paid by such employee (the employee’s estate) for the shares, or (2) the excess of the fair market value of the Company stock on the date of disposition or death over the purchase price paid by such employee (the estate) for the shares. The amount which is taxable as ordinary income is added to the cost basis of that Company stock for federal income tax purposes. The cost basis is therefore the sum of the purchase price of the Company stock and the ordinary income recognized from the formula above. If the disposition of the Company stock involves a sale or exchange, such employee will also realize a long-term capital gain or loss equal to the difference between such employee’s cost basis (calculated pursuant to the preceding sentence) and the proceeds from the sale or exchange of the shares. The Company is not entitled to a deduction for amounts taxed as ordinary income or capital gain to an employee except to the extent of ordinary income recognized upon a sale or disposition during the Tax Holding Period (an early disposition). SAB Biotherapeutics 2014 Equity Incentive Plan The SAB Biotherapeutics 2014 Equity Incentive Plan (the “2014 Incentive Plan”) was adopted on June 27, 2014. Summary of the 2014 Incentive Plan General The 2014 Incentive Plan covers the grant of awards to our employees (including officers), non-employee consultants and non-employee directors and those of our affiliates. For purposes of the 2014 Incentive Plan, our affiliates include any “parent” or “majority-owned subsidiary” of the Company, as such terms are defined in Rule 405 of the Securities Act. The compensation committee administers the 2014 Incentive Plan. The full Board must approve all decisions regarding awards to non-employee directors. Up to a maximum of 800,000 shares of our common stock (as adjusted following the Reverse Stock Split) may be delivered in settlement of awards granted under the 2014 Incentive Plan. Types of Awards The Incentive Plan permits the granting of any or all of the following types of awards to all grantees: • stock options, including incentive stock options, and non-statutory Stock Options; • stock appreciation rights, or SARs; • restricted shares; and • restricted stock units. For a description of each of these types of awards, see “SAB Biotherapeutics 2021 Equity Incentive Plan”. 99 Business Combination, Consolidation or Similar Corporate Transaction If there is a merger or consolidation of us with or into another corporation or a sale of substantially all of our stock (a “Corporate Transaction”), and the outstanding awards are not assumed by surviving company (its parent company) or replaced with equivalent awards granted by the surviving company(its parent company),the committee will cancel any outstanding awards that are not vested and nonforfeitable as of the consummation of such Corporate Transaction (unless the committee accelerates the vesting of any such awards) and with respect to any vested and nonforfeitable awards, the committee may either (i) allow all grantees to exercise options and SARs within a reasonable period prior to the consummation of the Corporate Transaction and cancel any outstanding options or SARs that remain unexercised upon consummation of the Corporate Transaction, or (ii) cancel any or all of such outstanding awards (including options and SARs) in exchange for a payment (in cash, or in securities or other property) in an amount equal to the amount that the grantee would have received (net of the exercise price with respect to any options or SARs) if the vested awards were settled or distributed or such vested options and SARs were exercised immediately prior to the consummation of the Corporate Transaction. If an exercise price of an option or SAR exceeds the fair market value of our common stock and the option or SAR is not assumed or replaced by the surviving company(its parent company),such options and SARs will be cancelled without any payment to the grantee. Amendment to and Termination of the 2014 Incentive Plan The 2014 Incentive Plan may be amended, altered, suspended, discontinued or terminated by our board of directors without further stockholder approval, unless such approval is required by law or regulation or under the rules of any stock exchange or automated quotation system on which our common stock is then listed or quoted. Thus, stockholder approval will not necessarily be required for amendments which might increase the cost of the 2014 Incentive Plan or broaden eligibility. Stockholder approval will not be deemed to be required under laws or regulations that condition favorable treatment of grantees on such approval, although our board of directors may, in its discretion, seek stockholder approval in any circumstance in which it deems such approval advisable. In addition, subject to the terms of the 2014 Incentive Plan, no amendment or termination of the 2014 Incentive Plan may materially and adversely affect the right of a grantee under any award granted under the 2014 Incentive Plan. Unless earlier terminated by our board of directors, the 2014 Incentive Plan will terminate when no shares remain reserved and available for issuance or, if earlier, on the tenth anniversary of the effective date of the 2014 Incentive Plan, which is June 27, 2024. Indemnification Agreements We have entered into indemnification agreements with each of our directors and executive officers. For more information, see “ Certain Relationships and Related Transactions, and Director Independence - Indemnification Agreements.” Potential Payments upon Termination or Change in Control The table below reflects, as applicable, amounts payable to our current named executive officers in connection with a termination by the Company without cause, by the executive for good reason, or upon non-renewal by the Company in the event of a change in control. For purposes of our agreements with our named executive officers, “cause” means, in the judgement of the Company: (i) executive engages in any act or omission which is in bad faith and to the detriment of the Company; (ii) executive willfully and materially violates any of the Company’s then-current policies and procedures; (iii) executive’s willful failure to perform his or her duties under the employment agreement; (iv) executive exhibits unfitness for service, dishonesty, habitual neglect, persistent and serious deficiencies in performance, or incompetence; (v) executive is convicted of, or there is an entry of guilty (or a nolo contender) plea by executive to, a crime (other than a minor traffic violation); (vi) executive materially breaches provision of the agreement related to nondisclosure, assignment of inventions and/or non-solicitation; or (vii) executive refuses or fails to act on any reasonable or lawful directive or order from the Board or executive's supervisor. 100 A summary of the potential payments that each of our current named executive officers would have received upon the occurrence of these events, assuming that each triggering event occurred on December 31, 2023, is set forth below. Salary Equity Perquisites / Benefits Other Total Name and Principal Position ($) ($) ($) ($) ($) Samuel J. Reich 350,000 — — — 350,000 Chairman of the Board of Directors and Chief Executive Officer Eddie J. Sullivan, PhD. 377,200 — — — 377,200 President Alexandra Kropotova, MD 525,000 — — — 525,000 EVP, Chief Medical Officer Michael G. King, Jr. 450,000 — — — 450,000 EVP, Chief Financial Officer Christoph Bausch, PhD 325,000 — — — 325,000 EVP, Chief Operating Officer Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. The following table sets forth information regarding the beneficial ownership of our common stock as of March 18, 2024 , by: • each person known to be the beneficial owner of more than 5% of our outstanding common stock; • each of our executive officers and directors; and • all of our executive officers and directors as a group. Beneficial ownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power over that security. Under those rules, beneficial ownership includes securities that the individual or entity has the right to acquire, such as through the exercise of stock options, within 60 days. Shares subject to options that are currently exercisable or exercisable within 60 days are considered outstanding and beneficially owned by the person holding such options for the purpose of computing the percentage ownership of that person but are not treated as outstanding for the purpose of computing the percentage ownership of any other person. Unless otherwise indicated, the Company believes that the persons and entities named in the table below have sole voting and investment power with respect to all shares shown as beneficially owned by them. Unless otherwise noted, the business address of each of the directors and executive officers of the Company is 2100 East 54th Street North, Sioux Falls, SD 57104. The percentage of beneficial ownership of the Company is calculated based on 9,225,494 shares of common stock outstanding as of March 18, 2024. Shares of common stock subject to warrants, options or rights currently exercisable, or exercisable within 60 days of March 18, 2024 are counted as beneficially owned. 101 Shares Beneficially Owned (1) Beneficial Owner Common Stock Percent Series A-2 Preferred Stock Percent Percent of Total Voting Power Executive Officers and Directors Christine Hamilton (2) 881,242 9.48 % — * % 5.51 % Eddie J. Sullivan, PhD (3) 590,975 6.36 % — * % 3.69 % Samuel J. Reich (4) 144,718 1.56 % — * % * % Jeffrey G. Spragens (5) 49,789 * % — * % * % William Polvino, MD (6) 13,958 * % — * % * % David Link, MBA (7) 20,394 * % — * % * % Scott Giberson (8) 1,534 * % — * % * % Erick Lucera (9) 902 * % — * % * % Andrew Moin (10) 458,457 4.97 % 28,380 67.19 % 24.29 % Katie Ellias (11) 285,714 3.1 % — * % 1.79 % Alexandra Kropotova (12) 23,161 * % — * % * % Michael G. King, Jr. (13) 500 * % — * % * % Christoph Bausch (14) 48,722 * % — * % * % All directors and executive officers as a group (13 persons) 2,520,066 26.40 % 28,380 67.19 % 33.85 % Other 5% Stockholders Entities affiliated with BVF Partners (15) 917,826 9.95 % 12,217 28.93 % 15.99 % Entities Managed by RTW Investments, LP (16) 917,827 9.95 % 217 * % 5.97 % * Represents beneficial ownership of less than one percent (1%). (1) Except as indicated in these footnotes: (i) each person named in this table has sole voting and investment power with respect to all shares of Common Stock and Series A Preferred Stock beneficially owned by such person; (ii) the number of shares beneficially owned by each person includes any restricted shares of Common Stock, shares of Common Stock that may be acquired through the exercise of options and warrants that such person has the right to acquire as of, or within 60 days of March 18, 2024, and after giving effect to any applicable limitations on beneficial ownership described in the footnotes below; and (iii) the beneficial ownership percentages shown above are based on a total of 15,929,620 eligible voting shares outstanding as of March 18, 2024, being comprised of (a) 9,225,494 shares of Common Stock and (b) 6,704,126 shares of Common Stock assuming conversion of 42,236 shares of Series A-2 Preferred Stock. (2) Consists of (i) 499,308 shares of common stock held by Ms. Hamilton; (ii) 17,424 shares of common stock held as a co-owner by Ms. Hamilton with her spouse, Dr. Edward Hamilton; (iii) 290,901 shares of common stock held by Ms. Hamilton’s spouse, Dr. Edward Hamilton; (iv) 2,500 shares held by Christiansen Investments; (v) 8,298 shares of common stock underlying warrants that are exercisable within 60 days of March 18, 2024; (vi) 16,283 shares of common stock underlying stock options held by Ms. Hamilton exercisable within 60 days of March 18, 2024; and (vii) 46,528 shares of common stock underlying stock options held by her spouse, Dr. Edward Hamilton, exercisable within 60 days of March 18, 2024. Ms. Hamilton is a control person with voting and dispositive power over shares of Christiansen Investments and is deemed to have beneficial ownership of the shares held by Christiansen Investments. Ms. Hamilton disclaims beneficial ownership of such securities except to the extent of her pecuniary interest therein, directly or indirectly. (3) Consists of (i) 523,230 shares of common stock held by Dr. Sullivan; and (ii) 67,745 shares of common stock underlying stock options held by Dr. Sullivan exercisable within 60 days of March 18, 2024. (4) Consists of (i) 21,800 shares of common stock held by Mr. Reich; (ii) 100 shares of common stock held jointly by Mr. Reich and Mr. Reich’s spouse; (iii) 54,769 of shares of common stock held by Big Cypress Holdings, LLC that are subject to vesting during a period of up to five years after October 22, 2021, which is the Business Combination Closing Date; (iv) 996 shares of common stock underlying warrants that are currently exercisable; and (v) 67,053 shares of common stock underlying stock options held by Mr. Reich exercisable within 60 days of March 18, 2024. Mr. 102 Reich is a managing member with voting and dispositive power over shares of Big Cypress Holdings, LLC and is deemed to have beneficial ownership of the shares held by Big Cypress Holdings, LLC. Mr. Reich disclaims beneficial ownership of such securities except to the extent of his pecuniary interest therein, directly or indirectly. (5) Consists of (i) 39,498 shares of common stock held by Mr. Spragens; and (ii) 10,291 shares of common stock underlying warrants that are currently exercisable. (6) Consists of 13,958 shares of common stock underlying stock options held by Dr. Polvino exercisable within 60 days of March 18, 2024. (7) Consists of (i) 5,731 shares of common stock held by Mr. Link; (ii) 1,209 of shares of common stock held by Iron Horse Investments, LLC; (iii) 4,149 shares of common stock underlying warrants that are currently exercisable; and (iv) 9,305 shares of common stock underlying stock options held by Mr. Link exercisable within 60 days of March 18, 2024. Mr. Link is a control person with voting and dispositive power over shares of Iron Horse Investments, LLC and is deemed to have beneficial ownership of the shares held by Iron Horse Investments, LLC. Mr. Link disclaims beneficial ownership of such securities except to the extent of his pecuniary interest therein, directly or indirectly. (8) Consists of 1,534 shares of common stock underlying stock options held by Mr. Giberson exercisable within 60 days of March 18, 2024. (9) Consists of 902 shares of common stock underlying stock options held by Mr. Lucera exercisable within 60 days of March 18, 2024. (10) Andrew Moin, an Analyst and Partner with Sessa Capital, is a member of the board of directors of the Company. Sessa Capital (Master), L.P. and its affiliates beneficially own the securities listed in the table above, and Mr. Moin disclaims beneficial ownership of such securities. Sessa is subject to a 4.99% blocker. (11) Based on information provided on a Form 4 filed with the SEC on November 28, 2023. Represents an aggregate of 285,714 shares of Common Stock. These securities are beneficially owned by JDRF T1D Fund, LLC (“JDRF”), directly. Helen Katherine Ellias, a Managing Director with JDRF, is a member of the board of directors of the Company. JDRF is a non-profit organization and Ms. Ellias is an employee of such organization. As such, Ms. Ellias disclaims beneficial ownership of any securities held by JDRF. (12) Consists of (i) 764 shares of common stock underlying stock options held by Ms. Kropotova exercisable within 60 days of March 18, 2024; and (ii) 22,397 shares of common stock underlying restricted stock units that will vest within 60 days of March 18, 2024. (13) Consists of 500 shares of common stock held by Mr. King as of March 18, 2024. (14) Consists of 48,722 shares of common stock underlying stock options held by Mr. Bausch exercisable within 60 days of March 18, 2024. (15) Based partially on a Schedule 13G filed with the SEC on December 4, 2023. Represents an aggregate of (i) 917,826 shares of Common Stock and (ii) 12,217 shares of the Company’s Series A-2 Preferred Stock which are convertible into an aggregate of 1,939,204 shares of Common Stock. These securities are beneficially owned by Biotechnology Value Fund, L.P., Biotechnology Value Fund II, L.P., Biotechnology Value Trading Fund OS LP, and MSI BVF SPV, LLC (collectively, the “BVF Funds”). The BVF Funds are subject to a 9.99% blocker. The address of the BVF Funds is 44 Montgomery St., 40th Floor San Francisco, California 94104. (16) Based partially on a Schedule 13G/A filed with the SEC on February 14, 2024. Represents an aggregate of (i) 917,827 shares of Common Stock and (ii) 217 shares of the Company’s Series A-2 Preferred Stock which are convertible into an aggregate of 34,443 shares of Common Stock. These securities are beneficially owned by RTW Master Fund, Ltd., RTW Innovation Master Fund, Ltd., and RTW Biotech Opportunities Ltd (collectively, the “RTW Funds”). RTW Investments, LP (“RTW”), in its capacity as the investment manager of the RTW Funds, has the power to vote and the power to direct the disposition of the shares held by the RTW Funds. Accordingly, RTW may be deemed to be the beneficial owner of such securities. Roderick Wong, M.D., as the Managing Partner of RTW, has the power to direct the vote and disposition of the securities held by RTW. Dr. Wong disclaims beneficial ownership of the shares held by the RTW Funds, except to the extent of his pecuniary interest therein. The address and principal office of RTW Investments, LP is 40 10th Avenue, Floor 7, New York, NY 10014, and the address of Dr. Wong and each of the RTW Funds is c/o RTW Investments, LP, 40 10th Avenue, Floor 7, New York, NY 10014. The RTW Funds are subject to a 9.99% blocker. 103 Equity Compensation Plan Information We currently maintain the following equity compensation plans that provide for the issuance of shares of our common stock to our officers and other employees, directors and consultants, each of which has been approved by our stockholders: the Incentive Plan; and the ESPP. We also maintain the 2014 Incentive Plan, which was not approved by our securityholders and was in place prior to us being a public company. The following table presents information as of December 31, 2023 with respect to compensation plans under which shares of our common stock may be issued: (a) (b) (c) Number of Securities to be Issued Upon Exercise of Outstanding Options and Awards Weighted-average exercise price of outstanding securities ($) Number of securities remaining available for future issuance under equity compensation plans (1) Equity compensation plans approved by security holders (2) 667,731 $ 13.82 620,031 Equity compensation plans not approved by security holders (3) 408,675 $ 14.49 323,755 Total 1,076,406 $ 14.08 943,786 (1) Excluding securities reflected in column (a). (2) Consists of our 2021 Plan and our ESPP. (3) Consists of our 2014 Plan. Item 13. Certain Relationships and Related Transactions, and Director Independence. The following includes a summary of transactions since January 1, 2023 to which we have been a party, in which the amount involved in the transaction exceeded the lesser of (i) $120,000 and (ii) 1% of the average of the Company’s total assets at year-end for the last two completed fiscal years, and in which any of our directors, executive officers or, to our knowledge, beneficial owners of more than 5% of our capital stock or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest, other than equity and other compensation, termination, change in control and other arrangements, which are described under “ Executive Compensation .” October 2023 Private Placement On September 29, 2023, we entered into a securities purchase agreement with certain accredited investors (the “September 2023 Purchase Agreement”), pursuant to which the Company agreed to issue and sell shares of preferred stock and warrants, in a private placement which provides for up to $110 million in proceeds across multiple tranches. Between October 2023 and November 2023, we received an aggregate of approximately $67.1 million for shares of preferred stock issued in this private placement offering. On September 29, 2023, we entered into a Board Designation Agreement, dated as of September 29, 2023, with Sessa Capital (Master), L.P. (“Sessa Capital”), pursuant to which Andrew Moin, who is a partner of Sessa Capital, was appointed as a member of the Board. Indemnification Agreements We have entered into indemnification agreements with each of our directors and executive officers. Each indemnification agreement provides for indemnification and advancements by us of certain expenses and costs relating to claims, suits or proceedings arising from his or her service to us or, at our request, service to other entities, as officers or directors to the maximum extent permitted by applicable law. Policies and Procedures for Transactions with Related Parties The Company has adopted a written Related Party Transaction Policy that set forth its procedures for the identification, review, consideration and approval or ratification of related person transactions. A related person includes directors, executive officers, beneficial owners of 5% or more of any class of the Company’s voting securities, immediate family members of any of the foregoing persons, and any entities in which any of the foregoing is an executive officer or is an owner 104 of 5% or more ownership interest. Under the Related Party Transaction Policy, if a transaction involving an amount in excess of $120,000 has been identified as a related person transaction, including any transaction that was not a related person transaction when originally consummated or any transaction that was not initially identified as a related person transaction prior to consummation, information regarding the related person transaction must be reviewed and approved by the Company’s audit committee. In considering related person transactions, the Company’s audit committee will take into account the relevant available facts and circumstances including, but not limited to: • the related person’s interest in the related person transaction; • the approximate dollar value of the amount involved in the related person transaction; • the approximate dollar value of the amount of the related person’s interest in the transaction without regard to the amount of any profit or loss; • whether the transaction was undertaken in the ordinary course of business of the Company; • whether the transaction with the related person is proposed to be, or was, entered into on terms no less favorable to the Company than terms that could have been reached with an unrelated third party; • the purpose of, and the potential benefits to the Company of, the transaction; and • any other information regarding the related person transaction or the related person in the context of the proposed transaction that would be material to investors in light of the circumstances of the particular transaction. The Related Party Transaction Policy requires that, in determining whether to approve, ratify or reject a related person transaction, the audit committee must review all relevant information available to it about such transaction, and that it may approve or ratify the related person transaction only if it determines that, under all of the circumstances, the transaction is in, or is not inconsistent with, the best interests of the Company. Item 14. Principal Accounting Fees and Services. The following table represents aggregate fees billed to the Company for the fiscal year ended December 31, 2023 by EisnerAmper LLP (“EisnerAmper”), the Company’s independent registered public accounting firm. (US Dollars) 2023 2022 Audit fees $ 299,687 $ — Audit-related fees — — Tax fees — — All other fees — — Total $ 299,687 $ — Audit fees for the fiscal years ended December 31, 2023 rendered by EisnerAmper relate to professional services rendered for the audit of our financial statements, quarterly reviews, issuance of consents, and review of documents filed with the SEC. The following table represents aggregate fees for professional services rendered for the Company by Mayer Hoffman McCann P.C. (“MHM”), its former independent registered public accounting firm for the years ended December 31, 2023 and 2022. Substantially all of MHM’s personnel, who work under the control of MHM shareholders, are employees of wholly-owned subsidiaries of CBIZ, Inc., which provides personnel and various services to MHM in an alternative practice structure. (US Dollars) 2023 2022 Audit fees $ 318,388 $ 710,644 Audit-related fees — — Tax fees — — All other fees — — Total $ 318,388 $ 710,644 Audit fees for the fiscal years ended December 31, 2023 and 2022 rendered by MHM relate to professional services rendered for the audits of our fiscal year 2022 financial statements, quarterly reviews prior to the Company’s change in independent registered public accounting firm, issuance of consents, and review of documents filed with the SEC. 105 Pre-Approval Policies and Procedures The Audit Committee has adopted a policy that sets forth the procedures and conditions pursuant to which audit and non-audit services proposed to be performed by the independent auditor may be pre-approved. The policy generally provides that we will not engage our independent registered public accounting firm (EisnerAmper) to render any audit, audit-related, tax or permissible non-audit service unless the service is either (i) explicitly approved by the Audit Committee (“specific pre-approval”) or (ii) entered into pursuant to the pre-approval policies and procedures described in the policy (“general pre-approval”). Unless a type of service to be provided by our independent registered public accounting firm has received general pre-approval under the policy, it requires specific pre-approval by the Audit Committee or by a designated member of the Audit Committee to whom the committee has delegated the authority to grant pre-approvals. Any proposed services exceeding pre-approved cost levels or budgeted amounts will also require specific pre-approval. For both types of pre-approval, the Audit Committee will consider whether such services are consistent with the SEC’s rules on auditor independence. 106 PART IV Item 15. Exhibits, Financial Statement Schedules. (1) For a list of the financial statements included herein, see Index to the Consolidated Financial Statements on page F-1 of this Form 10-K, incorporated into this Item by reference. (2) Financial statement schedules have been omitted because they are either not required or not applicable or the information is included in the consolidated financial statements or the notes thereto. (3) Exhibits: Exhibit Number Description Schedule/ Form File No. Exhibit Filing Date 1.1 Controlled Equity Offering℠ Sales Agreement, dated as of January 26, 2024 by and between Cantor Fitzgerald & Co. and SAB Biotherapeutics, Inc. 8-K 001-39871 1.1 January 26, 2024 2.1+ Agreement and Plan of Merger, dated as of June 21, 2021, by and among Big Cypress Acquisition Corp., Big Cypress Merger Sub Inc, SAB Biotherapeutics, Inc., and Shareholder Representative Services LLC as the Stockholders’ Representative 8-K 001-39871 2.1+ October 28, 2021 2.2+ First Amendment to Agreement and Plan of Merger, dated August 12, 2021, by and among Big Cypress Acquisition Corp. and SAB Biotherapeutics, Inc. 8-K 001-39871 2.2 October 28, 2021 3.1 Amended and Restated Certificate of Incorporation. 8-K 001-39871 3.1 October 28, 2021 3.2 Amended and Restated Bylaws. 8-K 001-39871 3.2 October 28, 2021 3.3 Certificate of Designation of Preferences, Rights and Limitations of the Series A Convertible Voting Preferred Stock 8-K 001-39871 3.1 October 2, 2023 3.4 Certificate of Amendment to the Amended and Restated Certificate of Incorporation 8-K 001-39871 3.1 November 22, 2023 3.5 Certificate of Amendment to the Certificate of Incorporation, as amended and restated, dated January 2, 2024 8-K 001-39871 3.1 January 3, 2024 4.1 Specimen common stock Certificate of Registrant. S-1/A 333-258869 4.2 January 4, 2021 4.2 Specimen Warrant Certificate of Registrant (incorporated by reference to Exhibit 4.3 of Form S-1/A.) S-1/A 333-258869 4.3 January 4, 2021 4.3 Form of Warrant Agreement between Registrant and Continental Stock Transfer & Trust Company. S-1/A 333-258869 4.4 January 4, 2021 4.4 Form Warrant 10-Q 001-39871 4.1 May 15, 2023 4.5* Description of Registrant’s Securities 4.6 Form of Preferred Tranche A Warrant 8-K 001-39871 4.1 October 2, 2023 4.7 Form of Preferred Tranche B Warrant 8-K 001-39871 4.2 October 2, 2023 4.8 Form of Preferred Tranche C Warrant 8-K 001-39871 4.3 October 2, 2023 10.1 Amended and Restated Registration Rights Agreement. 8-K 001-39871 10.1 October 28, 2021 10.2¥ Employment Agreement, dated March 1, 2021, by and between SAB Biotherapeutics, Inc. and Eddie J. Sullivan. 8-K 001-39871 10.2¥ October 28, 2021 10.3¥ Executive Employment Agreement, dated November 17, 2021, by and between SAB Biotherapeutics, Inc. and Samuel J. Reich 8-K 001-39871 10.1 November 19, 2021 107 10.4 Form of Indemnification Agreement. 8-K 001-39871 10.6 October 28, 2021 10.6¥ SAB Biotherapeutics, Inc. 2021 Omnibus Equity Incentive Plan. 8-K 001-39871 10.7 October 28, 2021 10.6¥ SAB Biotherapeutics, Inc. 2021 Employee Stock Purchase Plan. 8-K 001-39871 10.8 October 28, 2021 10.7 Form of Securities Subscription Agreement, dated November 12, 2020, between BCYP and Big Cypress Holdings LLC. S-4 333-258869 10.3 September 22, 2021 10.8 Securities Purchase Agreement, dated December 7, 2020, between BCYP and Ladenburg Thalmann & Co. Inc. and certain of its employees. S-4 333-258869 10.4 September 22, 2021 10.9 Placement Unit Subscription Agreement dated January 11, 2021 between the Company and Big Cypress Holdings LLC. S-4 333-258869 10.5 September 22, 2021 10.10 BCYP Stockholders Support Agreement. S-4 333-258869 10.7 September 22, 2021 10.11 SAB Stockholders Support Agreement. S-4 333-258869 10.8 September 22, 2021 10.12¥ Executive Employment Agreement, dated May 20, 2022, by and between SAB Biotherapeutics, Inc. and Alexandra Kropotova 10-K 001-39871 10.5 April 14, 2023 10.13 Third Amendment to Amended and Restated Lease Agreement 10-K 001-39871 10.14 April 14, 2023 10.14 Fourth Amendment to Amended and Restated Lease Agreement 8-K 001-39871 10.1 October 13, 2022 10.15+ Manufacturing Option Agreement, dated October 26, 2022 8-K 001-39871 10.1 November 1, 2022 10.16+ Right of First Refusal Agreement, dated October 26, 2022 8-K 001-39871 10.2 November 1, 2022 10.17 Securities Purchase Agreement dated December 6, 2022, by and between the Company and the purchasers thereto 8-K 001-39871 10.1 December 12, 2022 10.18 Form of Securities Purchase Agreement, dated September 29, 2023 by and among SAB Biotherapeutics, Inc. and the purchasers named therein 8-K 001-39871 10.1 October 2, 2023 10.19¥ Executive Employment Agreement between SAB Biotherapeutics, Inc. and Michael G. King, dated October 23, 2023 8-K 001-39871 10.1 October 27, 2023 10.20¥ Legacy SAB Biotherapeutics, Inc. 2014 Equity Incentive Plan S-8 333-277314 99.2 February 23, 2024 10.21¥ Executive Employment Agreement between SAB Biotherapeutics, Inc. and Eddie J. Sullivan, dated March 5, 2024 8-K 001-39871 10.1 March 8, 2024 10.22¥ Executive Employment Agreement between SAB Biotherapeutics, Inc. and Christoph Bausch, dated March 5, 2024 8-K 001-39871 10.2 March 8, 2024 16.1 Letter from Mayer Hoffman McCann P.C. to the Securities and Exchange Commission dated July 31, 2023 8-K 001-39871 16.1 July 31, 2023 21.1* List of Subsidiaries 23.1* Consent of Mayer Hoffman McCann P.C. 23.2* Consent of EisnerAmper LLP 24.1* Power of Attorney (included on a signature page of the initial filing of this Annual Report) 31.1* Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 108 31.2* Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1* Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2* Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 97.1* SAB Biotherapeutics, Inc. Clawback Policy 101.INS Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because 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 (embedded within the Inline XBRL document) * Filed herewith. + Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request. ¥ Denotes management contract or any compensatory plan, contract or arrangement. Item 16. Form 10-K Summary None. 109 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized . SAB BIOTHERAPEUTICS, INC. Date: March 28, 2024 By: /s/ Samuel J. Reich Samuel J. Reich Chair and Chief Executive Officer The undersigned officers and directors of SAB Biotherapeutics, Inc., hereby severally constitute and appoint Samuel J. Reich and Eddie J. Sullivan, and each of them individually, with full power of substitution and resubstitution, as their true and lawful attorneys and agents, to do any and all acts and things in their name and behalf in their capacities as directors and officers and to execute any and all instruments for them and in their names in the capacities indicated below, which said attorneys and agents, may deem necessary or advisable to enable said corporation to comply with the Securities Exchange Act of 1934, as amended, and any rules, regulations and requirements of the Securities and Exchange Commission, in connection with this Annual Report on Form 10-K, including specifically but without limitation, power and authority to sign for them or any of them in their names in the capacities indicated below, any and all amendments hereto, and they do hereby ratify and confirm all that said attorneys and agents, or either of them, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated. Name Title Date /s/ Samuel J. Reich Chair and Chief Executive Officer March 28, 2024 Samuel J. Reich (Principal Executive Officer) /s/ Michael G. King, Jr. Chief Financial Officer March 28, 2024 Michael G King, Jr. (Principal Financial Officer and Principal Accounting Officer) /s/ Eddie J. Sullivan, PhD President and Director March 28, 2024 Eddie J. Sullivan, PhD /s/ Katie Ellias Director March 28, 2024 Katie Ellias /s/ Christine Hamilton, MBA Director March 28, 2024 Christine Hamilton, MBA /s/ Scott Giberson, RPh, MPH, D.Sc. Director March 28, 2024 Scott Giberson, RPh, MPH, D.Sc. /s/ David Link, MBA Director March 28, 2024 David Link, MBA /s/ Erick Lucera Director March 28, 2024 Erick Lucera /s/ Andrew Moin Director March 28, 2024 Andrew Moin /s/ William Polvino, MD Director March 28, 2024 William Polvino, MD /s/ Jeffrey G. Spragens Director March 28, 2024 Jeffrey G. Spragens 1 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm (PCAOB ID 274) F- 2 Report of Independent Registered Public Accounting Firm (PCAOB ID 199) F- 3 Consolidated Balance Sheets as of December 31, 2023 and 2022 F- 4 Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2023 and 2022 F- 5 Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 31, 2023 and 2022 F- 6 Consolidated Statements of Cash Flows for the years ended December 31, 2023 and 2022 F- 7 Notes to Consolidated Financial Statements F- 8 F- 1 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of SAb Biotherapeutics, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of SAB Biotherapeutics, Inc. and Subsidiaries (the “Company”) as of December 31, 2023, and the related consolidated statements of operations and comprehensive loss, changes in stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2023, and the consolidated results of their operations and their cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. We also have audited the adjustments to the 2022 financial statements to retrospectively reflect the reverse stock split, as described in Note 2. In our opinion, such adjustments are appropriate and have been properly applied. We were not engaged to audit, review, or apply any procedures to the 2022 financial statements of the Company other than with respect to the adjustments and, accordingly, we do not express an opinion or any other form of assurance on the 2022 financial statements taken as a whole. /s/ EisnerAmper LLP We have served as the Company’s auditor since 2023. EISNERAMPER LLP Iselin, New Jersey March 28, 2024 F- 2 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of SAB Biotherapeutics, Inc. and Subsidiaries Opinion on the Consolidated Financial Statements We have audited, before the effects of the adjustments to retrospectively apply the reverse stock split described in Note 2, the accompanying consolidated balance sheet of SAB Biotherapeutics, Inc. and Subsidiaries (“Company”) as of December 31, 2022, and the related consolidated statements of operations, changes in stockholders’ equity and cash flows for the year then ended, and the related notes (collectively referred to as the “financial statements”). The 2022 financial statements before the effects of the adjustments discussed in Note 2 are not presented herein. In our opinion, the financial statements, before the effects of the adjustments to retrospectively apply the reverse stock split described in Note 2, present fairly, in all material respects, the financial position of the Company as of December 31, 2022, and the results of their operations and their cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. We were not engaged to audit, review, or apply any procedures to the adjustments to retrospectively apply the reverse stock split described in Note 2 and, accordingly, we do not express an opinion or any other form of assurance about whether such adjustments are appropriate and have been properly applied. Those adjustments were audited by EisnerAmper L.L.P. Going Concern Uncertainty The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company does not generate sufficient cash flows from operations to maintain operations and, therefore, is dependent on additional financing to fund operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1 to the financial statements. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. /s/ Mayer Hoffman McCann P.C. We served as the Company's auditor from 2019 to 2023 San Diego, California April 14, 2023 F- 3 SAB Biotherapeutics, Inc. and Subsidiaries Consolidated Balance Sheets December 31, 2023 December 31, 2022 Assets Current assets Cash and cash equivalents $ 56,566,066 $ 15,046,894 Accounts receivable, net — 5,556,577 Prepaid expenses and other current assets 2,340,797 1,493,982 Total current assets 58,906,863 22,097,453 Long-term prepaid insurance 350,230 467,694 Operating lease right-of-use assets 1,277,982 1,192,054 Financing lease right-of-use assets 3,669,659 3,896,873 Property, plant and equipment, net 19,736,519 23,250,853 Total assets $ 83,941,253 $ 50,904,927 Liabilities and Stockholders’ Equity Current liabilities Accounts payable $ 945,927 $ 3,679,116 Notes payable 1,050,849 772,665 Operating lease liabilities, current portion 669,946 490,794 Finance lease liabilities, current portion 132,004 132,788 Deferred grant income 1,322,410 — Accrued expenses and other current liabilities 6,692,181 9,917,981 Total current liabilities 10,813,317 14,993,344 Operating lease liabilities, noncurrent 635,777 361,225 Finance lease liabilities, noncurrent 3,418,483 3,629,642 Warrant liabilities 11,774,235 320,930 Notes payable, noncurrent — 541,644 Total liabilities 26,641,812 19,846,785 Commitments and contingencies (Note 17) Stockholders’ equity Preferred stock; $ 0.0001 par value; 10,000,000 shares authorized, 42,236 shares issued and outstanding at December 31, 2023 and 0 shares issued and outstanding at December 31, 2022, respectively 5 — Common stock; $ 0.0001 par value; 800,000,000 shares authorized at December 31, 2023 and December 31, 2022; 9,280,159 and 5,094,901 shares issued, respectively, and 9,225,494 and 5,040,236 outstanding at December 31, 2023 and December 31, 2022, respectively 929 510 Treasury stock, at cost; 54,665 shares held at December 31, 2023 and 2022 ( 5,521,246 ) ( 5,521,246 ) Additional paid-in capital 152,856,874 84,448,633 Accumulated other comprehensive income 26,420 — Accumulated deficit ( 90,063,541 ) ( 47,869,755 ) Total stockholders’ equity 57,299,441 31,058,142 Total liabilities and stockholders’ equity $ 83,941,253 $ 50,904,927 * The consolidated balance sheets' common stock share amounts have been retroactively adjusted to account for the Company's 1:10 Reverse Stock Split, effective January 5, 2024. See accompanying notes to the consolidated financial statements. F- 4 SAB Biotherapeutics, Inc. and Subsidiaries Consolidated Statements of Operations and Comprehensive Loss For The Year Ended December 31, 2023 2022 Revenue Grant revenue $ 2,238,991 $ 23,904,181 Total revenue 2,238,991 23,904,181 Operating expenses Research and development 16,515,005 36,438,513 General and administrative 23,799,306 16,383,285 Total operating expenses 40,314,311 52,821,798 Loss from operations ( 38,075,320 ) ( 28,917,617 ) Other income (expense) Changes in fair value of warrant liabilities ( 4,823,237 ) 10,399,200 Interest expense ( 315,284 ) ( 301,584 ) Interest income 584,966 71,072 Other income 435,089 33,754 Total other income (expense) ( 4,118,466 ) 10,202,442 Loss before income taxes ( 42,193,786 ) ( 18,715,175 ) Income tax expense (benefit) — 25,629 Net loss $ ( 42,193,786 ) $ ( 18,740,804 ) Other comprehensive loss: Foreign currency translation $ 26,420 — Total comprehensive loss $ ( 42,167,366 ) $ ( 18,740,804 ) Loss per common share attributable to the Company’s shareholders Basic and diluted loss per common share $ ( 7.64 ) $ ( 4.31 ) Weighted-average common shares outstanding – basic and diluted 5,521,487 4,352,497 *The consolidated statements of operations and comprehensive loss's share and per share amounts have been retroactively adjusted to account for the Company's 1:10 Reverse Stock Split, effective January 5, 2024. See accompanying notes to the consolidated financial statements. F- 5 SAB Biotherapeutics, Inc. and Subsidiaries Consolidated Statements of Changes In Stockholders’ Equity For the years ended December 31, 2023 and 2022 Common stock Preferred Stock Treasury Stock Shares Amount Shares Amount Additional Paid-In Capital Shares Amount Accumulated Deficit Accumulated Other Comprehensive Income Total Stockholders’ Equity Balance at December 31, 2021 4,348,563 $ 435 — $ — $ 67,678,429 — $ — $ ( 29,128,951 ) $ — $ 38,549,913 Forward Share Purchase Agreement, final settlement — — — — 817,060 — — — — 817,060 Repurchase of common stock pursuant to the Forward Share Purchase Agreement — — — — 5,521,246 ( 54,665 ) ( 5,521,246 ) — — — Stock-based compensation — — — — 2,674,204 — — — — 2,674,204 Issuance of common stock for exercise of stock options 9,026 1 — — 76,970 — — — — 76,971 Issuance of common stock and warrants under private placement offering, net of issuance costs of $ 0.3 million 736,338 74 — — 7,680,724 — — — — 7,680,798 Net Loss — — — — — — — ( 18,740,804 ) — ( 18,740,804 ) Balance at December 31, 2022 5,093,927 510 — — 84,448,633 ( 54,665 ) ( 5,521,246 ) ( 47,869,755 ) — 31,058,142 Issuance of common stock for exercise of stock options 1,774 1 — — 9,581 — — — — 9,582 Issuance of common stock for settlement of accrued liabilities and professional fees 191,689 19 — — 1,549,982 — — — — 1,550,001 Professional fees settled with warrants — — — — 3,831,171 — — — — 3,831,171 Professional fees settled with shares 38,095 4 — — 239,996 — — — — 240,000 Issuance of Series A Preferred Stock and warrants under private placement offering — — 7,500 1 — — — — — 1 Series A Preferred Stock warrant exercise — — 59,654 6 60,353,789 — — — — 60,353,795 Conversion of Series A Preferred Stock into common shares 3,954,674 395 ( 24,918 ) ( 2 ) 2 — — — — 395 Stock-based compensation — — — — 2,423,720 — — — — 2,423,720 Net loss — — — — — — — ( 42,193,786 ) — ( 42,193,786 ) Foreign currency translation — — — — — — — — 26,420 26,420 Balance at December 31, 2023 9,280,159 $ 929 42,236 $ 5 $ 152,856,874 ( 54,665 ) $ ( 5,521,246 ) $ ( 90,063,541 ) $ 26,420 $ 57,299,441 *The consolidated statements of stockholder's equity share amounts have been retroactively adjusted to account for the Company's 1:10 Reverse Stock Split, effective January 5, 2024. See accompanying notes to the consolidated financial statements. F- 6 SAB Biotherapeutics, Inc. and Subsidiaries Consolidated Statements of Cash Flows Year Ended December 31, 2023 2022 Cash flows from operating activities: Net loss $ ( 42,193,786 ) $ ( 18,740,804 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 3,653,151 3,169,429 Amortization of finance right-of-use assets 92,131 122,449 Stock-based compensation expense 2,423,720 2,674,203 Gain on sale of equipment 44,493 ( 15,805 ) Gain on partial lease termination — ( 32,208 ) Loss on private placement issuance 3,402,784 — Gain from private placement warrant termination ( 3,572,920 ) — Changes in fair value of warrant liabilities 4,823,237 ( 10,399,200 ) Professional fees settled with equity instruments 3,881,566 — Changes in operating assets and liabilities Accounts receivable 5,556,577 2,454,131 Prepaid expenses ( 523,610 ) 674,552 Operating lease right-of-use assets 387,299 53,441 Accounts payable ( 2,701,720 ) ( 779,425 ) Due to related party — ( 2,367 ) Deferred grant income 1,322,410 ( 100,000 ) Accrued expense and other current liabilities ( 1,714,737 ) ( 2,537,907 ) Net cash used in operating activities ( 25,119,405 ) ( 23,459,511 ) Cash flows from investing activities: Proceeds from the sale of equipment 44,450 76,390 Purchases of equipment ( 197,154 ) ( 2,166,414 ) Net cash used in investing activities ( 152,704 ) ( 2,090,024 ) Cash flows from financing activities: Proceeds from issuance of common stock — 7,680,799 Proceeds from private placement issuance of preferred stock and warrants 7,500,000 — Proceeds from exercise of private placement preferred warrants 59,654,000 — Payments related to the Forward Share Purchase Agreement — ( 5,521,246 ) Proceeds from issuance of notes payable 765,194 1,236,125 Payments of notes payable ( 1,028,654 ) ( 2,260,183 ) Principal payments on finance leases ( 126,985 ) ( 161,055 ) Proceeds from exercise of stock options 9,582 76,971 Net cash provided by financing activities 66,773,137 1,051,411 Effect of exchange rate changes on cash and cash equivalents 18,144 — Net increase (decrease) in cash and cash equivalents 41,519,172 ( 24,498,124 ) Cash and cash equivalents Beginning of year 15,046,894 39,545,018 End of year $ 56,566,066 $ 15,046,894 Supplemental cash flow information: Cash paid for interest $ 245,481 $ 293,392 Cash paid for income taxes $ — $ 25,629 Supplemental information on non-cash investing and finance activities: Right-of-use assets obtained in exchange for operating lease liabilities $ 993,811 $ 65,088 Right-of-use assets forfeited due to partial lease terminations $ — $ 447,810 Operating lease liabilities eliminated due to partial lease terminations $ — $ 480,035 Note payable issued in consideration for abated lease payments $ — $ 541,644 Settlement of accrued liabilities through the issuance of common stock $ 1,500,000 $ — Issuance of common stock for prepaid marketing and investor related consulting services $ 240,000 $ — Fair value of private placement preferred warrant liability associated with warrant exercise $ 699,795 $ — See accompanying notes to the consolidated financial statements. F- 7 SAb Biotherapeutics, Inc. and subsidiaries Notes to con SOLIDATED financial statements (1) Nature of Business SAB Biotherapeutics, Inc., a Delaware corporation (“SAB” or “SAB Biotherapeutics”, and together with its subsidiaries, the “Company”), is a clinical-stage biopharmaceutical company focused on the development and commercialization of a portfolio of products from its proprietary immunotherapy platform to produce fully targeted human polyclonal antibodies, without using human plasma or serum. SAB’s novel immunotherapy platform that is developing fully-human hIgC for delaying onset or progression of T1D. Australian Research and Development Tax Credit In June 2023, the Company formed a new subsidiary in Australia, SAB BIO PTY LTD, a proprietary limited company (“SAB Australia”), primarily to conduct preclinical and clinical activities for product candidates. SAB Australia’s research and development activities qualify for the Australian government’s tax credit program, which provides a 39.5 % credit for qualifying research and development expenses. The Company started Phase 1 trials in the fourth quarter of 2023. Liquidity The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The Company has experienced net losses, negative cash flows from operations and, as of December 31, 2023, had an accumulated deficit of $ 90.1 million . The Company anticipates to continue to generate losses for the foreseeable future and expects the losses to increase as the Company continues the development of, or seeks regulatory approvals for product candidates, and begins commercialization of products. As a result, the Company will require additional capital to fund operations in order to support long-term plans. On September 29, 2023, the Company entered into a securities purchase agreement with certain accredited investors (the “September 2023 Purchase Agreement”), pursuant to which the Company agreed to issue and sell shares of preferred stock and warrants, in a private placement which provides for up to $ 110 million in proceeds across multiple tranches. Between October 2023 and November 2023, the Company received an aggregate of approximately $ 67.1 million for shares of preferred stock issued in this private placement offering. See Note 12, Warrants for further information about the private placement offering. Based on the Company’s current level of operating expenses, existing resources will be sufficient to cover operating cash needs through the twelve months following the date these financials are issued. The Company plans to seek additional funding through a combination of equity or debt financings, or other third-party financing, collaborative or other funding arrangements. Should the Company seek additional financing from outside sources, the Company may not be able to raise such financing on terms acceptable to the Company or at all. If the Company is unable to raise additional capital when required or on acceptable terms, the Company may be required to scale back or discontinue the advancement of product candidates, reduce headcount, liquidate assets, file for bankruptcy, reorganize, merge with another entity, or cease operations. (2) Summary of Significant Accounting Policies A summary of the significant accounting policies applied in preparation of the accompanying consolidated financial statements is set forth below. Basis of presentation The financial statements have been prepared in conformity with GAAP and include all adjustments necessary for the fair presentation of the Company’s financial position for the years presented. Emerging growth company status Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new F- 8 or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Principles of consolidation The accompanying consolidated financial statements include the results of the Company and its wholly owned subsidiaries, SAB Sciences, Inc., SAB LLC, SAB Capra, LLC, Aurochs, LLC, and SAB Australia. Intercompany balances and transactions have been eliminated in consolidation . Significant risks and uncertainties The Company’s operations are subject to a number of factors that can affect its operating results and financial condition. Such factors include, but are not limited to, the results of research and development efforts, clinical trial activities of the Company’s product candidates, the Company’s ability to obtain regulatory approval to market its product candidates, competition from products manufactured and sold or being developed by other companies, and the Company’s ability to raise capital. The Company currently has no commercially approved products and there can be no assurance that the Company’s research and development will be successfully commercialized. Developing and commercializing a product requires significant time and capital and is subject to regulatory review and approval as well as competition from other biotechnology and pharmaceutical companies. The Company operates in an environment of rapid change and is dependent upon the continued services of its employees and obtaining and protecting intellectual property. Funding from government grants is not guaranteed to cover all costs, and additional funding may be needed to cover operational costs as the Company moves forward to with our efforts to develop a commercially approved product. 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 of assets, liabilities, revenue and expenses and the disclosure of contingent assets and liabilities in the financial statements. The Company has used significant estimates in its determination of stock-based compensation assumptions, determination of the fair value of the Private Placement Warrant liabilities, determination of the incremental borrowing rate (“IBR”) used in the calculation of the Company’s right of use assets and lease liabilities, estimation of clinical and other accruals and the valuation allowance on deferred tax assets. Actual amounts realized may differ from these 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 (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The following fair value hierarchy classifies the inputs to valuation techniques that would be used to measure fair value into one of three levels: Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions. Certain of the Company’s financial instruments are not measured at fair value on a recurring basis but are recorded at amounts that approximate their fair value due to the short-term nature of their maturities, such as cash and cash equivalents, accounts receivable, accounts payable and accrued expenses. F- 9 The Company accounts for warrants to purchase its preferred and common stock pursuant to ASC Topic 470, Debt , and ASC Topic 480, Distinguishing Liabilities from Equity , and classifies warrants for preferred and common stock as liabilities or equity. The warrants classified as liabilities are reported at their estimated fair value (see Note 13, Fair Value Measurements ) and any changes in fair value are reflected in other income and expense. The warrants classified as equity are reported at their estimated relative fair value with no subsequent remeasurement. The Company’s outstanding warrants are discussed in more detail in Note 13, Fair Value Measurements . Cash, cash equivalents, and restricted cash Cash equivalents include short-term, highly liquid instruments, consisting of money market accounts and short-term investments with original maturities at the date of purchase of 90 days or less. Accounts receivable Accounts receivable are carried at original invoice amount, less an allowance for doubtful accounts. The Company estimates an allowance for doubtful accounts for potential credit losses that are expected to be incurred, based on management’s assessment of the collectability of specific accounts, the aging of the accounts receivable, historical information and other currently available evidence. Receivables are written off when deemed uncollectible. To date, no receivables have been written off. The Company had no allowance for doubtful accounts as of December 31, 2023 and 2022 . Concentration of credit risk The Company maintains its cash and cash equivalent balances in the form of business checking accounts and money market accounts, the balances of which, at times, may exceed federally insured limits. Although the Company currently believes that the financial institutions with whom it does business will be able to fulfill their commitments to the Company, there is no assurance that those institutions will be able to continue to do so. The Company has not experienced any credit losses associated with its balances in such accounts for the year ended December 31, 2023 and 2022 . Lease liabilities and right-of-use assets The Company is party to certain contractual arrangements for equipment, lab space, and an animal facility, which meet the definition of leases under ASC 842. In accordance with ASC 842, the Company recorded right-of-use assets and related lease liabilities for the present value of the lease payments over the lease terms. The Company’s IBR was used in the calculation of its right-of-use assets and lease liabilities. The Company elected not to apply the recognition requirements of ASC 842 to short-term leases, which are deemed to be leases with a lease term of twelve months or less. Instead, the Company recognized lease payments in the Consolidated Statements of Operations on a straight-line basis over the lease term and variable payments in the period in which the obligation for these payments was incurred. The Company elected this policy for all classes of underlying assets. Research and development expenses Expenses incurred in connection with research and development activities are expensed as incurred. These include licensing fees to use certain technology in the Company’s research and development projects, fees paid to consultants and various entities that perform certain research and testing on behalf of the Company, and expenses related to animal care, research-use equipment depreciation, salaries, benefits, and stock-based compensation granted to employees in research and development functions. During the years ended December 31, 2023 and 2022, the Company had contracts with multiple CROs to complete studies as part of research grant agreements. These costs include upfront, milestone and monthly expenses as well as reimbursement for pass through costs. All research and development costs are expensed as incurred except when the Company is accounting for nonrefundable advance payments for goods or services to be used in future research and development activities. In these cases, these payments are capitalized at the time of payment and expensed in the period the research and development activity is performed. As actual costs become known, the Company will adjust the accrual; such changes in estimate may be a material change in the Company’s clinical study accrual, which could also materially affect reported results of operations. For the years ended December 31, 2023 and 2022 , there were no material adjustments to the Company’s prior period estimates of accrued expenses for clinical trial. F- 10 Property, Plant and Equipment The Company records property, plant, and equipment at cost less depreciation and amortization. Depreciation is calculated using straight-line methods over the following estimated useful lives: Animal facility equipment 7 years Laboratory equipment 7 years Leasehold improvements Shorter of asset life or lease term Office furniture and equipment 5 years Vehicles 5 years Repairs and maintenance expenses are expensed as incurred. Impairment of long-lived assets The Company reviews the recoverability of long-lived assets, including the related useful lives, whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. If necessary, the Company compares the estimated undiscounted future net cash flows to the related asset’s carrying value to determine whether there has been an impairment. If an asset is considered impaired, the asset is written down to fair value, which is based either on discounted cash flows or appraised values in the period the impairment becomes known. The Company believes that long-lived assets are recoverable, and no impairment was deemed necessary, during the years ended December 31, 2023 and 2022 . Stock-based compensation FASB ASC Topic 718, Compensation – Stock Compensation , prescribes accounting and reporting standards for all share-based payment transactions in which employee and non-employee services are acquired. The Company recognizes compensation cost relating to stock-based payment transactions using a fair-value measurement method, which requires all stock-based payments to employees, directors, and non-employee consultants, including grants of stock options, to be recognized in operating results as compensation expense based on fair value over the requisite service period of the awards. The Company determines the fair value of common stock based on the closing market price at closing on the date of the grant. In determining the fair value of stock-based awards, the Company utilizes the Black-Scholes option-pricing model, which uses both historical and current market data to estimate fair value. The Black-Scholes option-pricing model incorporates various assumptions, such as the value of the underlying common stock, the risk-free interest rate, expected volatility, expected dividend yield, and expected life of the options. For awards with performance-based vesting criteria, the Company estimates the probability of achievement of the performance criteria and recognizes compensation expense related to those awards expected to vest. No awards may have a term in excess of ten years . Forfeitures are recorded when they occur. Stock-based compensation expense is classified in the consolidated statements of operations based on the function to which the related services are provided. The Company recognizes stock-based compensation expense over the vesting period . Income taxes Deferred income taxes reflect future tax effects of temporary differences between the tax and financial reporting basis of the Company’s assets and liabilities measured using enacted tax laws and statutory tax rates applicable to the periods when the temporary differences will affect taxable income. When necessary, deferred tax assets are reduced by a valuation allowance, to reflect realizable value, and all deferred tax balances are reported as long-term on the consolidated balance sheet. Accruals are maintained for uncertain tax positions, as necessary. The Company uses a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken, or expected to be taken, in a tax return. The Company has elected to treat interest and penalties related to income taxes, to the extent they arise, as a component of income taxe s. Revenue recognition The Company’s revenue is primarily generated through grants from government and other (non-government) organizations. Grant revenue is recognized during the period that the research and development services occur, as qualifying expenses are incurred or conditions of the grants are met. Deferred grant income represents grant proceeds received by the Company prior to the period in which the underlying research and development services have not yet been performed. The Company concluded that payments received under these grants represent conditional, nonreciprocal contributions, as described in ASC F- 11 958, Not-for-Profit Entities , and that the grants are not within the scope of ASC 606, Revenue from Contracts with Customers , as the organizations providing the grants do not meet the definition of a customer. Expenses for grants are tracked by using a project code specific to the grant, and the employees also track hours worked by using the project code . Foreign Currency Translations and Transactions Assets and liabilities of the Company's foreign subsidiary are translated at the year-end exchange rate. Operating results of the Company's foreign subsidiary are translated at average exchange rates during the period. Translation adjustments have no effect on net income and are included in “Accumulated other comprehensive income, net” in the accompanying Consolidated Balance Sheets . Comprehensive income (loss) Foreign currency translation adjustments of $ 26 thousand represent the difference between net loss and comprehensive loss for the year ended December 31, 2023. The Company had no items of comprehensive loss other than its net loss for the year ended December 31, 2022 . Litigation From time to time, the Company is involved in legal proceedings, investigations and claims generally incidental to its normal business activities. In accordance with U.S. GAAP, the Company accrues for loss contingencies when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Legal costs in connection with loss contingencies are expensed as incurred. Earnings per share In accordance with ASC 260, Earnings per Share (“ASC 260”), basic net income (loss) per share attributable to common stockholders is computed by dividing net income (loss) attributable to common stockholders by the weighted-average number of common stock outstanding during the period. Diluted net income (loss) per share attributable to common stockholders is computed by dividing the diluted net income (loss) attributable to common stockholders by the weighted-average number of common stock outstanding for the period including potential dilutive common shares such as stock options. Segment reporting In accordance with ASC 280, Segment Reporting , the Company’s business activities are organized into one reportable segment, as only the Company’s operating results in their entirety are regularly reviewed by the Company’s chief operating decision maker to make decisions about resources to be allocated and to assess performance. Australian Research and Development Tax Credit The Company recognizes other income from Australian research and development incentives when there is reasonable assurance that the income will be received, the relevant expenditure has been incurred, and the consideration can be reliably measured. The research and development incentive is one of the key elements of the Australian Government’s support for Australia’s innovation system and is supported by legislative law primarily in the form of the Australian Income Tax Assessment Act 1997, as long as eligibility criteria are met. Under the program, a percentage of eligible research and development expenses incurred by the Company through its subsidiary in Australia are reimbursed. Management has assessed the Company’s research and development activities and expenditures to determine which activities and expenditures are likely to be eligible under the research and development incentive regime described above. At each period end, management estimates the refundable tax offset available to the Company based on available information at the time and it is included in other income in the consolidated statements of operations. Retroactive Adjustments for Common Stock Reverse Split On January 5, 2024, the Company completed a 1-for-10 reverse stock split of the Company’s Common Stock. As a result of the Reverse Stock Split, every ten of the Company’s issued shares of Common Stock were automatically combined into one F- 12 issued share of Common Stock, without any change to the par value per share. All share and per share numbers in this Annual Report on Form 10-K have been adjusted to reflect the Reverse Stock Split. (3) New accounting standards Recently-adopted standards In July 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which requires the measurement of all expected credit losses of financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 is effective for periods beginning after December 15, 2022, and interim periods within those fiscal years. The Company adopted ASU 2016-13 at January 1, 2023 , and the adoption did not have a material impact on its consolidated financial statements. Recently Issued Accounting Standards In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments require (i) enhanced disclosures in connection with an entity's effective tax rate reconciliation and (ii) income taxes paid disaggregated by jurisdiction. The amendments are effective for annual periods beginning after December 15, 2024. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures. (4) Revenue During the years ended December 31, 2023 and 2022, the Company worked on the following grants: Government grants The total revenue for government grants was approximately $ 2.2 million and $ 23.9 million respectively, for the years ended December 31, 2023 and 2022. NIH-NIAID (Federal Award #1R44AI117976-01A1) – this grant was for $ 1.4 million and started in September 2019 through August 2021. This grant was subsequently amended to extend the end date to August 2022. No grant income was recognized for the year ended December 31, 2023. For the year ended December 31, 2022, there was approximately $ 182 thousand in grant income recognized from this grant. This grant was completed in 2022. NIH-NIAID (Federal Award #1R41AI131823-02) – this grant was for approximately $ 1.5 million and started in April 2019 through March 2021. The grant was subsequently amended to extend the date through March 2023. For the years ended December 31, 2023 and 2022, approximately $ 192 thousand and $ 328 thousand , respectively, in grant income was recognized from this grant. This grant was completed as of June 30, 2023. NIH-NIAID through Geneva Foundation (Federal Award #1R01AI132313-01, Subaward #S-10511-01) – this grant was for approximately $ 2.7 million and started in August 2017 through July 2021. The grant was subsequently amended to extend the end date to July 2023. For the years ended December 31, 2023 and 2022, there was approximately $ 273 thousand and $ 1.1 million , respectively, in grant income recognized from this grant. This grant was completed as of June 30, 2023. DoD, JPEO through Advanced Technology International – this grant was for a potential of $ 25 million, awarded in stages starting in Aug ust 2019 and with potential stages running through February 2023. Additional contract modifications were added to this contract in 2020 and 2021 for work on a COVID therapeutic, bringing the contract total to $ 203.6 million. For the years ended December 31, 2023 and 2022, there was approximately $ 1.8 million and $ 22.2 million , respectively, in grant income recognized from this grant. This grant was terminated in 2022. The grants for the JPE O Rapid Response contract are cost reimbursement agreements, with reimbursement of qualified direct research and development expense (labor and consumables) with an overhead charge (based on actual, reviewed quarterly) and a fixed fee ( 9 %). On August 3, 2022, the Company received notice from the DoD terminating the JPEO Rapid Response contract. The Company engaged in negotiations with the DoD to compensate the Company for services provided prior to the JPEO Rapid F- 13 Response Contract Termination and costs the Company would be expected to bear in future periods. A termination and settlement proposal was submitted the DoD on September 9, 2022; the Company submitted a final invoice on December 15, 2022; and received payment from the DoD on or about January 12, 2023. The terms of the arrangement provide for a cost-reimbursable structure, and state that the parties will work in good faith equitable reimbursement for work performed toward accomplishment of the tasks provided in the agreement. At this time, other than certain deferred obligations (presented within deferred grant income within the Company's consolidated balance sheet) potentially payable to the DoD solely due to subsequent negotiations with third-party vendors, the Company believes and has been advised there is a reasonable, good faith basis for the position that no present or future obligations exist. Revenue recognized subsequent to the JPEO Rapid Response Contract Termination relates to satisfaction of residual obligations under the termination and settlement agreement—see Note 2, Summary of Significant Accounting Policies in the Company's consolidated financial statements for further information about the Company's established revenue recognition process. (5) Earnings per share Since the Company reported a net loss for the years ended December 31, 2023 and 2022, it was required by ASC 260 to use basic weighted-average shares outstanding when calculating diluted net loss per share for the years ended December 31, 2023 and 2022 , as the potential dilutive securities are anti-dilutive. For The Year Ended December 31, 2023 2022 Calculation of basic and diluted loss per share attributable to the Company’s shareholders Net loss attributable to the Company’s shareholders $ ( 42,193,786 ) $ ( 18,740,804 ) Weighted-average common shares outstanding – basic and diluted 5,521,487 4,352,497 Net loss per share, basic and diluted $ ( 7.64 ) $ ( 4.31 ) The Company’s potentially dilutive securities, which include stock options, restricted stock awards, common stock warrants, earnout shares, and contingently issuable earnout shares have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share. Therefore, the weighted average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to common stockholders is the same. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect: For The Year Ended December 31, 2023 2022 Stock options and awards 72,804 219,336 Convertible Debt 39,718 36,829 Common Stock Warrants (1) 2,233,407 595,860 Earnout Shares (2) 1,049,193 1,049,193 Series A Preferred Stock (3) 6,704,127 — Preferred Stock Warrants (4) 23,803,334 — Contingently issuable Earnout Shares from unexercised Rollover Options 150,806 150,806 Total 34,053,389 2,052,024 (1) Contained within Common Stock Warrants are the 575,000 the Public Warrants, 20,860 warrants held by assignees of Big Cypress Holdings, LLC (the “Private Placement Warrants”), 30,000 warrants held by Ladenburg Thalmann & Co. Inc. (the “Ladenburg Warrants”), 736,337 warrants issued to the investors in the December 2022 Private Placement (the “the PIPE Warrants”), 21,091 warrants issued to the placement agent in the December 2022 Private Placement (the “PIPE Placement Agent Warrants”), and 850,119 warrants issued to the placement agent in the October 2023 Private Placement. See Note 12, Warrants for further details on the Company’s outstanding warrants. (2) The Earnout Shares are subject to certain vesting requirements not satisfied as of the years ended December 31, 2023 and 2022. The Earnout Shares held in escrow are excluded from calculating both basic and diluted earnings F- 14 per share. See Note 10, Stockholders’ Equity for further details on the Company’s outstanding equity instruments. (3) Represents shares of common stock underlying 42,236 issued, outstanding, and convertible Series A-2 Preferred shares. (4) Represents 6,800,953 and 17,002,381 common shares underlying 42,846 outstanding Tranche B Warrants and 107,115 outstanding Tranche C Warrants, respectively. (6) Property, Plant and Equipment As of December 31, 2023 and 2022, the Company’s equipment was as follows: December 31, 2023 December 31, 2022 Laboratory equipment $ 9,415,210 $ 9,000,114 Animal facility leasehold improvements 8,357,667 8,357,667 Animal facility equipment 1,137,666 1,141,213 Construction-in-progress — 308,317 Leasehold improvements 9,296,344 9,296,343 Vehicles 208,453 192,683 Office furniture and equipment 1,233,038 1,233,038 Total Property, plant and equipment, gross 29,648,378 29,529,375 Less: accumulated depreciation and amortization ( 9,911,859 ) ( 6,278,522 ) Property, plant and equipment, net $ 19,736,519 $ 23,250,853 Depreciation and amortization expense for the years ended December 31, 2023 and 2022 was $ 3.7 million and $ 3.2 million , respectively. All tangible personal property with a useful life of at least three years and a unit acquisition cost of $ 5,000 or more will be capitalized and depreciated over its useful life using the straight-line method of depreciation. The Company will expense the full acquisition cost of tangible personal property below these thresholds in the year of purchase. The basis of accounting for depreciable fixed assets is acquisition cost and any additional expenditures required to make the asset ready for use. The carrying amount at the balance sheet date of long-lived assets under construction-in-progress includes assets purchased, constructed, or being developed internally that are not yet in service. Depreciation commences when the assets are placed in service. As of December 31, 2023 and 2022, the Company’s construction-in-progress was as follows: December 31, 2023 December 31, 2022 New office space at Headquarters $ — $ 85,767 IT equipment at Headquarters — 84,739 Software — 137,811 Total construction-in-progress $ — $ 308,317 (7) Leases The Company has an operating lease for lab space from Sanford Health, under a lease that started in June 2014 and initially ended in June 2019, at which time the lease was extended through August 2024. This lease can be terminated with one-year advance written notice. This lease was amended again in October 2022 to reduce the Company’s leased area to 21,014 square feet. Additionally, pursuant to the amendment in October 2022, the Company and Sanford Health agreed for the period of October 2022 to September 2023, the Company’s obligation to pay the Annual Rent shall be abated and not required to be paid when normally due (the “Abated Rent”). In exchange for the Abated Rent, effective October 1, 2022, the Company issued Sanford Health an 8 % unsecured, convertible promissory note (see Note 9, Notes Payable for further discussion). The October 2022 amendment was accounted for as a lease modification under ASC 842 - Leases and the right-of-use asset and F- 15 lease liability were remeasured at the modification date of October 1, 2022. The October 2022 lease amendment reduced the lease payment to approximately $ 45 thousand per month for the remainder of 2023 and approximately $ 46 thousand per month through 2024. The lease does not provide an implicit rate, and, therefore, the Company used an IBR of 6.92 % as the discount rate when measuring the operating lease liability. The operating lease does not include an option to extend beyond the life of the current term. The Company estimated the IBR based upon comparing interest rates available in the market for similar borrowings and the credit quality of the Company. The Company entered into a lease for office, laboratory, and warehouse space in November 2020, which the Company amended in July 2022. This lease has a 3 -year term, with options to extend for 3 additional periods of 3 years each. The options were not included in the right of use calculation as it is unclear as to whether or not the location will meet the Company’s requirements beyond the next three years. The July 2022 amendment was accounted for as a separate contract under ASC 842 – Leases . This lease was renewed in November 2023. The lease costs are $ 36 thousand , $ 3 thousand , and $ 31 thousand per month for the November 2020 lease agreement, the July 2022 amended lease agreement, and the November 2023 lease renewal, respectively. The Company used an IBR of 4.69 % , 6.60 % , and 8.14 % as the discount rate when measuring the operating lease liability for the November 2020 lease agreement, the July 2022 amended lease agreement, and the November 2023 lease renewal, respectively. The Company estimated the IBR based upon comparing interest rates available in the market for similar borrowings and the credit quality of the Company. The Company has the following finance leases: • In December 2018, the Company entered into a finance lease with Dakota Ag Properties for a new animal facility which includes the surrounding land. The facility and the land have been accounted for as separate lease components. The lease is based upon payback of $ 4 million in construction costs, with a 20-year term at an interest rate of 8 %. The monthly payment for this lease is $ 34 thousand. The Company has the option to purchase the asset at any time during the term of the lease for the balance of the unamortized lease payments. • In December 2018, the Company entered into an equipment lease for a 12,000 -gallon propane tank that is located on the Company’s animal facility. The lease is for five years , with an annual payment of $ 8 thousand. The Company has the option to purchase the asset at any time during the term of the lease for the balance of the unamortized lease payments. The lease agreements do not require material variable lease payments, residual value guarantees or restrictive covenants. The amortizable lives of the operating lease assets are limited by their expected lease terms. The amortizable lives of the finance lease assets are limited by their expected lives, as the Company intends to exercise the purchase options at the end of the leases. The following is the estimated useful lives of the finance lease assets: Animal Facility 40 years Equipment 3 – 7 years Land Indefinite The Company’s weighted-average remaining lease term and weighted-average discount rate for operating and finance leases as of December 31, 2023 are: Operating Finance Weighted-average remaining lease term 2.23 14.92 Weighted-average discount rate 7.83 % 7.72 % F- 16 The table below reconciles the undiscounted future minimum lease payments under non-cancelable leases with terms of more than one year to the total lease liabilities recognized on the consolidated balance sheet as of December 31, 2023: Operating Finance 2024 $ 740,277 $ 401,496 2025 371,957 401,496 2026 309,964 401,496 2027 — 401,496 2028 — 401,496 Thereafter — 3,981,502 Undiscounted future minimum lease payments 1,422,198 5,988,982 Less: Amount representing interest payments ( 116,475 ) ( 2,438,495 ) Total lease liabilities 1,305,723 3,550,487 Less current portion ( 669,946 ) ( 132,004 ) Noncurrent lease liabilities $ 635,777 $ 3,418,483 Operating lease expense was approximately $ 1.0 million and $ 1.2 million , respectively, for the years ended December 31, 2023 and 2022. Operating lease costs are included within research and development expenses on the consolidated statements of operations. Finance lease costs for the years ended December 31, 2023 and 2022 included approximately $ 0.1 million and $ 0.1 million respectively, in right-of-use asset amortization and approximately $ 0.3 million and $ 0.3 million , respectively, of interest expense. Finance lease costs are included within research and development expenses on the consolidated statements of operations. Cash payments under operating and finance leases were approximately $ 0.6 million and $ 0.4 million , respectively, for the year ended December 31, 2023. Cash payments under operating and finance leases were approximately $ 1.2 million and $ 0.4 million , respectively, for the year ended December 31, 2022 . (8) Accrued Expenses and Other Current Liabilities As of December 31, 2023 and 2022, accrued expenses and other current liabilities consisted of the following: December 31, 2023 December 31, 2022 Accrued vacation $ 656,132 $ 511,849 Accrued payroll 412,943 357,390 Accrued construction-in-progress — 85,767 Accrued consulting 174,554 186,833 Accrued clinical trial expense 363,937 355,479 Accrued outside laboratory services 116,498 1,106,903 Accrued bonus & severance 2,331,233 950,324 Accrued contract manufacturing — 25,129 Accrued legal 907,816 856,505 Accrued financing fees payable 1,461,149 4,910,500 Accrued franchise tax payable 40,000 50,000 Accrued interest 77,995 8,192 Other accrued expenses 149,924 513,110 $ 6,692,181 $ 9,917,981 F- 17 (9 ) Notes Payable As of December 31, 2023 and 2022, notes payable was as follows: December 31, 2023 December 31, 2022 Insurance financing note payable $ 509,205 $ 772,665 8% Unsecured Convertible Note 541,644 541,644 Total notes payable 1,050,849 1,314,309 Less: notes payable - current portion 1,050,849 772,665 Notes payable, noncurrent $ — $ 541,644 8% Unsecured Convertible Note Pursuant to the Fourth Amendment to the Company’s lease with Sanford Health, the Company and Sanford Health agreed to a period of Abated Rent from October 1, 2022 to September 30, 2023. In exchange for the Abated Rent, effective as of October 1, 2022, the Company issued to Sanford Health an 8 % unsecured, convertible promissory note (the “8% Unsecured Convertible Note”). Pursuant to the 8% Unsecured Convertible Note, the Company shall pay the sum of approximately $ 542 thousand (the “Principal”) plus accrued and unpaid interest thereon on September 30, 2024 (the “Maturity Date”). Simple interest shall accrue on the outstanding Principal from and after the date of the 8% Unsecured Convertible Note and shall be payable on the Maturity Date. Sanford Health shall have the right, but not the obligation, to convert all or any part of the outstanding Principal of the 8% Unsecured Convertible Note, together with any accrued and unpaid interest thereon to the date of such conversion, into such number of fully paid and non-assessable shares of the Company’s common stock, at any time and from time to time, prior to the later of the Maturity Date and the date on which the 8% Unsecured Convertible Note is paid in full, subject to certain restrictions, at a conversion price per share of common stock equal to greater of (x) $ 15.00 and (y) the price at which the Company sells shares of common stock in any bona fide private or public equity financing prior to the Maturity Date. The Company evaluated the treatment of the 8% Unsecured Convertible Note under ASC 470 and determined the Principal in its entirety would be allocated to debt. The Company’s consolidated balance sheet as of December 31, 2023, includes accrued interest relating to the 8% Unsecured Convertible Note of approximately $ 43 thousand . Insurance Financing The Company obtained financing for certain Director & Officer liability insurance policy premiums. The agreement assigns First Insurance Funding (“Lender”) a first priority lien on and security interest in the financed policies and any additional premium required in the financed policies including (a) all returned or unearned premiums, (b) all additional cash contributions or collateral amounts assessed by the insurance companies in relation to the financed policies and financed by Lender, (c) any credits generated by the financed policies, (d) dividend payments, and (e) loss payments which reduce unearned premiums. If any circumstances exist in which premiums related to any Financed Policy could become fully earned in the event of loss, Lender shall be named a loss-payee with respect to such policy. The total premiums, taxes and fees financed is approximately $ 765 thousand with an annual interest rate of 7.96 %. In consideration of the premium payment by Lender to the insurance companies or the agent or broker, the Company unconditionally promises to pay Lender the amount financed plus interest and other charges permitted under the agreement. At December 31, 2023 and 2022, the Company recognized approximately $ 509 thousand and $ 773 thousand , respectively, as an insurance financing note payable in its consolidated balance sheets. The Company will pay the insurance financing through installment payments with the last payment for the current note being on September 22, 2024. (10) Stockholder's Equity Authorized Capital Stock The total number of shares of the Company’s authorized capital stock is 810,000,000 . The total amount of authorized capital stock consists of 800,000,000 shares of common stock and 10,000,000 shares of preferred stock. F- 18 Series A Preferred Stock On September 29, 2023, the Company entered into a securities purchase agreement (the “September 2023 Purchase Agreement”) with certain accredited investors, pursuant to which the Company agreed to issue and sell, in a private placement (the “September 2023 Offering”), (i) 7,500 shares of Series A-1 Convertible Preferred Stock, par value $ 0.0001 per share, for an aggregate offering price of $ 7.5 million (the “Series A-1 Preferred Stock”), (ii) tranche A warrants (the “Preferred Tranche A Warrants”) to acquire shares of Series A-1 Preferred Stock or Series A-3 Preferred Stock, par value $ 0.0001 per share, for an aggregate exercise price of $ 70.5 million (the “Series A-3 Preferred Stock”), (iii) tranche B warrants to acquire shares of Series A-3 Preferred Stock, par value $ 0.0001 per share, for an aggregate exercise price of $ 52.0 million (the “Preferred Tranche B Warrants”), and (iv) tranche C warrants to purchase Series A-3 Preferred Stock, par value $ 0.0001 per share, for an aggregate exercise price of $ 130.0 million (the “Preferred Tranche C Warrants” and together with the Preferred Tranche A Warrants, and Preferred Tranche B Warrants, the “Preferred Warrants” and the shares underlying the Preferred Warrants, the “Preferred Warrant Shares”). On October 3, 2023, the Company closed on the issuance of the 7,500 shares of Series A-1 Preferred Stock (the “Initial Issuance Date”). In connection with the issuance of the 7,500 shares of Series A-1 Preferred Stock, gross proceeds were $ 7.5 million, before deducting fees to be paid to the placement agent and financial advisors of the Company and other offering expenses payable by the Company. The Company intends to use the net proceeds from the September 2023 Offering for working capital purposes and other general corporate purposes and to advance its SAB-142-101 clinical trial. The Company recorded $ 7.5 million in gross proceeds associated with the initial issuance of the 2023 Private Placement transaction whereby the Company issued 7,500 shares of Series A-1 Convertible preferred stock and warrants to purchase common stock in the combined company. The Company estimated the initial value of the warrants to be $ 10.9 million. Since the warrants are classified as liabilities, the initial amount recorded as the warrant liability was equal to the estimated fair value of the warrants. Since the fair value of these warrants exceeded the equity proceeds, the entire amount of proceeds were allocated to the warrants and the remaining value allocated to the warrants resulted in a $ 3.4 million loss on the issuance of the Series A Preferred Stock. Subject to the terms and limitations contained in the Certificate of Designation: • The Series A-1 Preferred Stock issued in the September 2023 Offering will not become convertible until the Company’s stockholders approve (i) the issuance of all common stock issuable upon conversion of the Issued Preferred Stock and the Preferred Warrant Shares, (ii) the issuance of the Preferred Warrant Shares upon exercise of the Preferred Warrants and (iii) an amendment to the Company’s Certificate of Incorporation to increase the number of authorized shares of common stock from 490,000,000 to 800,000,000 (collectively, the “Stockholder Approval”). • On the first trading day following the announcement of the Stockholder Approval, each share of Series A-1 Preferred Stock will automatically convert into common stock, at the conversion price of $ 6.30 per share (the “Conversion Price”), provided that to the extent such conversion would cause a holder of Series A-1 Preferred Stock to exceed the applicable beneficial ownership limitation, such holder will receive shares of Series A-2 Preferred Stock in lieu of common stock. • At the option of the holder, each share of Series A-2 Preferred Stock and Series A-3 Preferred Stock will be convertible into common stock, at the Conversion Price (which is subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization). The Preferred Tranche A Warrants were exercisable beginning on October 2, 2023, (the “Issuance Date”) (as defined in the Form of Preferred Tranche A Warrant) until the earlier of (i) fifteen (15) trading days following the date of the public announcement of the fulsome data set from the Sanofi S.A. Protect trial or (ii) December 15, 2023. If any purchaser in the September 2023 Offering failed to exercise their Preferred Tranche A Warrant in full prior to its expiration date, such purchaser forfeited all Preferred Tranche A Warrants, Preferred Tranche B Warrants, and Preferred Tranche C Warrants issued to them. The Preferred Tranche B Warrants are exercisable commencing on the Exercisability Date (as defined in the Form of Preferred Tranche B Warrant) until the later of (i) 15 days following the Company’s announcement of data from its SAB-142-101 clinical trial and (ii) March 31, 2025. The Preferred Tranche C Warrants are exercisable commencing on the Exercisability Date (as defined in the Form of Preferred Tranche C Warrant) until the five (5) year anniversary of the Exercisability Date. Prior to the extended mandatory exercise time, certain investors informed the Company that they would not exercise their mandatorily exercisable Preferred Tranche A Warrants. Certain of the investors agreed to assume and exercise 16,269 of the 27,115 unexercised Preferred Tranche A Warrants and received 10,846 of the Preferred Tranche B Warrants and 27,115 of the Preferred Tranche C Warrants from the transferring Investors. The balance of the unexercised Preferred Tranche A F- 19 Warrants and the remaining Tranche B Warrants and Tranche C Warrants issued to the Investors who failed to exercise their Tranche B Warrants were cancelled. Following these updates to the offering, the Company issued 59,654 shares of Series A-1 Preferred Stock for aggregate proceeds of approximately $ 59.65 million upon the exercise of the Tranche A Warrants. Pursuant to the Certificate of Designation of Preferences, Rights and Limitations of the Series A Convertible Voting Preferred Stock, (the “Certificate of Designation”), all shares of Series A-1 Preferred Stock, subject to the Stockholder Approval obtained in November 2023, were automatically converted into an aggregate of 3,954,674 shares of common stock, par value $ 0.0001 per share and 42,236 shares of Series A-2 Preferred Stock, par value $ 0.0001 per share, of the Company (the “Series A-2 Preferred Stock”). Following Shareholder Approval of the September 2023 Private Placement on November 22, 2023, the Company issued 67,154 shares of Series A-1 Convertible Preferred Stock. Following shareholder approval of the Company's 2023 Private Placement transaction, 24,918 shares of Series A-1 Convertible Preferred Stock were converted into 3,954,674 common shares, with the remaining 42,236 shares of Series A-1 Convertible Preferred Stock being converted into Series A-2 Convertible preferred stock. For information pertaining to the Company’s outstanding warrants to purchase shares of the Company’s preferred stock, see Note 12, Warrants . Earnout Shares On October 22, 2021 (the “Closing Date”), the Company consummated the business combination contemplated by the agreement and plan of merger, dated as of June 21, 2021, as amended on August 12, 2021, made by and among Big Cypress Acquisition Corp., a Delaware corporation (“BCYP”), Big Cypress Merger Sub Inc., a Delaware corporation (“Merger Sub”), the Company, and Shareholder Representative Services LLC, a Colorado limited liability company, solely in its capacity as the representative, agent and attorney-in-fact of the SAB Stockholders (the “Business Combination”). Upon closing of the Business Combination, Merger Sub merged with SAB Biotherapeutics, with SAB Biotherapeutics as the surviving company of the merger. Upon closing of the Business Combination, BCYP changed its name to “SAB Biotherapeutics, Inc.”. Additionally, the Business Combination Agreement included an earnout provision whereby the shareholders of SAB Biotherapeutics shall be entitled to receive additional consideration (“Earnout Shares”) if the Company meets certain Volume Weighted Average Price (“VWAP") thresholds, or a change in control with a per share price exceeding the VWAP thresholds within a five-year period immediately following the Closing. The Earnout Shares shall be released in four equal increments as follows: (i) 25 % of the Earnout Shares shall be released if, at any time during the five ( 5 )-year period immediately following the Closing Date, the VWAP of the Company’s publicly traded common stock is greater than or equal to $ 150.00 for any twenty ( 20 ) trading days within a period of thirty ( 30 ) consecutive trading days (the “First Earnout”). (ii) 25 % of the Earnout Shares shall be released if, at any time during the five ( 5 )-year period immediately following the Closing Date, the VWAP of the Company’s publicly traded common stock is greater than or equal to $ 200.00 for any twenty ( 20 ) trading days within a period of thirty ( 30 ) consecutive trading days (the “Second Earnout”). (iii) 25 % of the Earnout Shares shall be released if, at any time during the five ( 5 )-year period immediately following the Closing Date, the VWAP of the Company’s publicly traded common stock is greater than or equal to $ 250.00 for any twenty ( 20 ) trading days within a period of thirty ( 30 ) consecutive trading days (the “Third Earnout”). (iv) 25 % of the Earnout Shares shall be released if, at any time during the five ( 5 )-year period immediately following the Closing Date, the VWAP of the Company’s publicly traded common stock is greater than or equal to $ 300.00 for any twenty ( 20 ) trading days within a period of thirty ( 30 ) consecutive trading days (the “Fourth Earnout” and together with the First Earnout, the Second Earnout and the Third Earnout, the “Earnouts”). Pursuant to the terms of the Business Combination Agreement, SAB Biotherapeutics’ securityholders (including vested option holders) who own SAB Biotherapeutics securities immediately prior to the Closing Date will have the contingent right to receive their pro rata portion of (i) an aggregate of 1,200,000 shares of common stock (“Earnout Shares”), of which 150,806 are contingently issuable based upon future satisfaction of the aforementioned VWAP thresholds. The remaining 1,049,194 are legally issued and outstanding, if the Company does not meet the above VWAP thresholds, or a change in control with a per share price below the VWAP thresholds occurs within a five-year period immediately following the Closing Date, the shares will be returned to the Company. The Earnout Shares are indexed to the Company’s equity and meet the criteria for equity classification. On the Closing Date, the fair value of the 1,200,000 Earnout Shares was $ 101.3 million. The Company recorded the Earnout Shares as a stock F- 20 dividend by reducing additional paid-in capital, which was offset by the increase in additional paid-in capital associated with the Business Combination. Warrants For information pertaining to the Company’s outstanding warrants to purchase shares of the Company’s common stock, see Note 12, Warrants . (11) Stock Option Pla ns On August 5, 2014, the Company approved a stock option grant plan (the “2014 Equity Incentive Plan”) for employees, directors, and non-employee consultants, which provides for the issuance of options to purchase common stock. As of December 31, 2023 , there were 732,430 shares of common stock reserved for issuance under the 2014 Equity Incentive Plan, with 323,755 shares of common stock available for grant and 408,675 shares of common stock underlying outstanding grants. The Company adopted the 2021 Omnibus Equity Incentive Plan (the “2021 Equity Incentive Plan”, and collectively with the 2014 Equity Incentive Plan, the “Equity Compensation Plans”), which reserved 1,100,000 shares of common stock for issuance. At of the beginning of each calendar year, the shares reserved for future issuance shall increase by two percent ( 2 %) of the total number of Shares of Common Stock issued and outstanding on a fully-diluted basis as of the end of the Company’s immediately preceding fiscal year (or such lesser number of shares, including no shares, determined by the Board in its sole discretion); provided, however, that the aggregate number of additional Shares available for issuance pursuant to this paragraph (b) shall not exceed a total of 500,000 Shares. As of December 31, 2023 , there were 1,287,762 shares of common stock reserved for issuance under the 2021 Equity Incentive Plan, with 620,031 shares of common stock available for grant an d 667,731 share s of common stock underlying outstanding grants. The expected term of the stock options was estimated using the “simplified” method, as defined by the SEC’s Staff Accounting Bulletin No. 107, Share-Based Payment . The volatility assumption was determined by examining the historical volatilities for industry peer companies, as the Company does not have sufficient trading history for its common stock. The risk-free interest rate assumption is based on the U.S. Treasury instruments whose term was consistent with the expected term of the options. The dividend assumption is based on the Company’s history and expectation of dividend payouts. The Company has never paid dividends on its common stock and does not anticipate paying dividends on its common stock in the foreseeable future. Therefore, the Company has assumed no dividend yield for purposes of estimating the fair value of the options. Stock Options Stock option activity for employees and non-employees under the Equity Compensation Plans for the years ended December 31, 2023 and 2022 was as follows: Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (years) Aggregate Intrinsic Value Outstanding options, December 31, 2022 709,470 $ 19.87 5.79 $ 109,891 Granted 376,174 $ 6.20 Forfeited ( 59,349 ) $ 16.43 Exercised ( 1,774 ) $ 5.40 Expired ( 15,002 ) $ 19.54 Outstanding options, December 31, 2023 1,009,519 $ 15.01 6.19 $ 664,967 Options vested and exercisable, December 31, 2023 523,126 $ 20.19 3.45 $ 315,915 Total unrecognized compensation cost related to non-vested stock options as of December 31, 2023 was approximately $ 3.1 million and is expected to be recognized within future operating results over a weighted-average period of 3.11 years. The weighted average grant date fair value of options granted during the years ended December 31, 2023 and 2022, was $ 4.93 and $ 7.80 per share, respectively. During the years ended December 31, 2023 and 2022, 124,530 options vested with a fair value totaling $ 2.5 million and 63,466 options vested with a fair value totaling $ 3.1 million , respectively. F- 21 The estimated fair value of stock options granted during to employees and consultants for the years ended December 31, 2023 and 2022, were calculated using the Black-Scholes option-pricing model using the following assumptions: For The Year Ended December 31, 2023 2022 Expected volatility 80.2 - 85.9 % 78.0 - 97.4 % Weighted-average volatility 82.7 % 94.1 % Expected dividends — % — % Expected term (in years) 5.77 - 6.08 5.50 - 6.08 Risk-free rate 3.50 - 4.67 % 1.38 - 3.56 % Restricted Stock Stock award activity for employees and non-employees under the Equity Compensation Plans for the year ended December 31, 2023 was as follows: Number of shares Weighted Average Grant Date Fair Value Unvested as of December 31, 2022 35,000 $ 17.22 Granted 31,887 $ 5.35 Vested ( 12,816 ) $ 1.72 Unvested as of December 31, 2023 54,071 $ 10.16 At December 31, 2023, the Company had an aggregate of $ 0.5 million of unrecognized equity-based compensation related to restricted stock units outstanding. During the year ended December 31, 2023, 12,816 shares with a fair value of $ 0.2 million vested. At December 31, 2023, the Company had 12,816 restricted stock units vested but not issued. The unrecognized expense for restricted stock units is expected to be recognized within future operating results over a weighted average period of 2.87 years. Stock-based compensation expense Stock-based compensation expense for the December 31, 2023 and 2022 was as follows: For The Year Ended December 31, 2023 2022 Research and development $ 619,487 $ 857,331 General and administrative 1,804,233 1,816,873 Total $ 2,423,720 $ 2,674,204 (12) Warrants Public Warrants Each whole Public Warrant entitles the holder to purchase one share of the Company's common stock at a price of $ 115.00 per share, subject to adjustment as discussed herein. Once the warrants become exercisable, the Company may call the warrants for redemption: • in whole and not in part; • at a price of $ 0.01 per warrant; upon not less than 30 days’ prior written notice of redemption (the “30-day redemption period”) to each warrant holder; and F- 22 • if, and only if, the reported last sale price of the common stock equals or exceeds $ 180.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending three business days before the Company send the notice of redemption to the warrant holders. If the Company calls the warrants for redemption as described above, management will have the option to require any holder that wishes to exercise its warrant to do so on a “cashless basis.” If management takes advantage of this option, all holders of warrants would pay the exercise price by surrendering their warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the excess of the “fair market value” (defined below) over the exercise price of the warrants by (y) the fair market value. The “fair market value” shall mean the average reported last sale price of the common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Private Placement Warrants The Private Placement Warrants and the common stock issuable upon the exercise of the Private Placement Warrants were not transferable, assignable or saleable until after the completion of the Company's merger transaction in 2021. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable as long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. As of December 31, 2023 , 20,860 Private Placement Warrants classified as liabilities were outstanding. PIPE Warrants and PIPE Placement Agent Warrants In December 2022, the Company entered into a securities purchase agreement with certain institutional and accredited investors for the sale by the Company of 736,337 shares of common stock and warrants to purchase up to 736,337 shares of common stock (the “PIPE Warrants”), in a private placement offering. The combined purchase price each share and accompanying PIPE Warrant was $ 10.80 (the “December 2022 Private Placement”). Three directors of the Company participated in the December 2022 Private Placement, each paying a $ 1.25 premium per share and accompanying PIPE Warrant. The PIPE Warrants, including those purchased by the participating directors of the Company, are exercisable beginning six months from the date of issuance at an exercise price equal to $ 10.80 per share, and are exercisable for five years from the date of issuance. The Company received gross proceeds of approximately $ 8.0 million before deducting transaction related fees and expenses. The Company paid Brookline Capital Markets, the placement agent, a cash fee equal to seven percent of the gross proceeds received by the Company in the December 2022 Private Placement. The Company also issued Brookline Capital Markets a warrant to purchase up to an aggregate of 21,091 shares of common stock (the “PIPE Placement Agent Warrants”), equal to 7 % of the number of shares purchased by investors introduced to the Company by Brookline Capital Markets. The PIPE Placement Agent Warrants have an exercise price equal to $ 13.50 per share and are exercisable six months from the date of issuance and expire five years from the date of issuance. 2023 Ladenburg Agreement Warrants On March 21, 2023, the Company entered into a settlement agreement with Ladenburg Thalmann & Co. Inc. (“Ladenburg”), effective March 23, 2023 (the “2023 Ladenburg Agreement”, regarding the action brought by Ladenburg, the “Ladenburg Action”). In connection with the 2023 Ladenburg Agreement, on March 24, 2023, the Company (i) issued the Ladenburg Warrants to purchase up to 30,000 shares of common stock, exercisable for three years from the date of issuance at $ 5.424 per share; and (ii) furnished to Ladenburg a one-time cash payment of $ 500 thousand. Pursuant to the terms and subject to the conditions set forth in the 2023 Ladenburg Agreement, the Company will (i) no later than June 30, 2023, pay $ 1.5 million to Ladenburg in cash or shares of common stock, at the Company’s option; and (ii) no later than December 31, 2023, pay $ 1.1 million to Ladenburg in cash or shares of common stock, at the Company’s option. Following the completion of the Company’s obligations under the 2023 Ladenburg Agreement, Ladenburg has agreed to dismiss the Ladenburg Action with prejudice and extinguish any and all obligations of the Company in connection therewith. All consideration contemplated by the 2023 Ladenburg Agreement are contained within accrued expenses and other current liabilities within the Company’s consolidated balance sheet as of December 31, 2022. On June 30, 2023, in accord with the terms of the agreement, the Company issued 191,689 shares of common stock to satisfy a portion of its obligations under the 2023 Ladenburg Agreement. Following the completion of the 2023 Private Placement, the Company settled the remaining $ 1.1 million due to Ladenburg in cash. F- 23 September 2023 Purchase Agreement Warrants As of December 31, 2023 , the Company now has outstanding 42,846 Tranche B Warrants to acquire shares of Series A-3 Preferred Stock for an aggregate exercise price of approximately $ 42.85 million, and 107,115 Tranche C Warrants to purchase shares of Series A-3 Preferred Stock for an aggregate exercise price of approximately $ 107.1 million. Both the Tranche B Warrants and Tranche C Warrants were classified as derivative liabilities because they are redeemable for cash upon occurrence of a Fundamental Transaction, as defined in the Forms for such warrants, which may be outside the control of the Company. Preferred Placement Agent Warrant On November 21, 2023 the Company issued to Chardan Capital Markets LLC, the placement agent for the Preferred Warrants, a warrant to purchase 850,119 shares ( as adjusted following the Reverse Stock Split) of the Company’s common stock (“the Preferred PIPE Placement Agent Warrants”) The Preferred PIPE Placement Agent Warrants have an exercise price equal to $ 6.30 per share (subject to adjustment for stock dividends and splits) and are exercisable in whole or in part, at any time or times on or after the issuance date and on or before October 2, 2028. The Preferred Placement Agent Warrant was classified in equity in additional paid-in capital. The following table summarizes warrant activity for the year ended December 31, 2023: Outstanding December 31, 2022 Warrants Issued Warrants Exercised Warrants Forfeited Outstanding December 31, 2023 Transaction — Business Combination Public Warrants 575,000 — — — 575,000 Private Placement Warrants 20,860 — — — 20,860 PIPE Warrants 736,337 — — — 736,337 PIPE Placement Agent Warrants 21,091 — — — 21,091 Ladenburg Warrants — 30,000 — — 30,000 Tranche A Warrants — 70,500 59,654 10,846 — Tranche B Warrants — 52,000 — 9,154 42,846 Tranche C Warrants — 130,000 — 22,885 107,115 Preferred PIPE Placement Agent Warrants — 850,119 — — 850,119 Presentation and Valuation of the Warrants — Liability Classified Warrants Public Warrants and Private Placement Warrants The Public Warrants and Private Placement Warrants are accounted for as liabilities in accordance with ASC 815-40, Derivatives and Hedging — Contracts in Entity ’ s Own Equity and were presented within warrant liabilities on the consolidated balance sheets as of December 31, 2023 and 2022. The initial fair value of the warrant liabilities was measured at fair value at the Closing Date, and changes in the fair value of the warrant liabilities were presented within changes in fair value of warrant liabilities in the consolidated statements of operations for the years ended December 31, 2023 and 2022. On the Closing Date, the Company established the fair value of the Private Placement Warrants utilizing both the Black-Scholes Merton formula and a MCS analysis. Specifically, the Company considered an MCS to derive the implied volatility in the publicly-listed price of the Public Warrants. The Company then considered this implied volatility in selecting the volatility for the application of a Black-Scholes Merton model for the Private Placement Warrants. The Company determined the fair value of the Public Warrants by reference to the quoted market price. The Public Warrants were classified as a Level 1 fair value measurement, due to the use of the quoted market price, and the Private Placement Warrants held privately by assignees of Big Cypress Holdings LLC, were classified as a Level 3 fair value measurement, due to the use of unobservable inputs. See Note 13, Fair Value Measurements, for changes in fair value of the Private Placement Warrants. F- 24 The key inputs into the valuations as of the December 31, 2023 and 2022 were as follows: December 31, 2023 December 31, 2022 Risk-free interest rate 4.03 % 4.00 % Expected term remaining (years) 2.81 3.81 Implied volatility 85.0 % 82.0 % Closing common stock price on the measurement date $ 0.69 $ 0.59 Preferred Warrants Should the Company enter into or be party to a fundamental transaction, the Company will be required to purchase all outstanding Warrants from the holders by paying cash in an amount equal to the Black Scholes Value of the unexercised portion of each Preferred Warrant. As a result, the Preferred Warrants are accounted for as derivative liabilities in accordance with ASC 480 and ASC 815-40, Derivatives and Hedging — Contracts in Entity ’ s Own Equity and were presented within warrant liabilities on the consolidated balance sheet as of December 31, 2023. The initial fair value of the warrant liabilities was measured at fair value at the Closing Date, and changes in the fair value of the warrant liabilities were presented within changes in fair value of warrant liabilities in the consolidated statement of operations for the year ended December 31, 2023. On the Initial Issuance Date, the Company established the fair value of the Preferred Warrants utilizing the Black-Scholes Merton formula. All tranches of the Preferred Warrants were classified as Level 3 fair value measurements, due to the use of unobservable inputs. See Note 13, Fair Value Measurements, for changes in fair value of the Preferred Warrants. The key inputs utilized in determining the fair value of each Tranche A Warrant as of the Initial Issuance Date was as follows: October 3, 2023 Initial Measurement Risk-free interest rate (1) 5.58 % Expected term remaining (years) (1) 0.16 Implied volatility 65.0 % Underlying Stock Price (Preferred Series A) $ 546.30 (1) Reflects a probability-weighted input derived from multiple Black-Scholes calculations. These calculations account for various potential dates for the public announcement of the comprehensive data set from the Sanofi S.A. Protect trial, spanning from mid-October to December 15, 2023. The key inputs utilized in determining the fair value of each Tranche B Warrants as of the Initial Issuance Date and December 31, 2023 were as follows: October 3, 2023 Initial Measurement (2) December 31, 2023 Risk-free interest rate (1) 2.68 % 2.58 % Expected term remaining (years) (1) 0.75 0.69 Implied volatility 75.0 % 85.0 % Underlying Stock Price (Preferred Series A) $ 546.30 $ 560.56 (1) Reflects a probability-weighted input derived from multiple Black-Scholes calculations. These calculations take into account the various potential dates for the announcement of the SAB-142-101 data. Specifically, the Company assumed a 50.0 % probability of no data release on the Initial Measurement Date. This probability was later adjusted to 45.0 % as of December 31, 2023. (2) Reflects a 5 % discount for lack of marketability. F- 25 The key inputs utilized in determining the fair value of each Tranche C Warrants as of the Initial Issuance Date and December 31, 2023 were as follows: October 3, 2023 Initial Measurement (2) December 31, 2023 Risk-free interest rate (1) 4.80 % 3.85 % Expected term remaining (years) (1) 5.15 4.91 Implied volatility 85.0 % 85.0 % Underlying Stock Price (Preferred Series A) $ 546.30 $ 560.56 (1) Reflects a probability-weighted input derived from multiple Black-Scholes calculations. These calculations incorporate the company's estimated probability of dissolution, should SABS’ intellectual property fail to yield positive results in forthcoming clinical trials, potentially leading to the company's dissolution before 2028. Initially, the company estimated a 20.0 % probability of continuing operations through the expected remaining term. This probability was later adjusted to 25.0 % as of December 31, 2023. (2) Reflects a 5 % discount for lack of marketability. Equity Classified Warrants The Company determined the Ladenburg Warrants, PIPE Warrants, PIPE Placement Agent Warrants, and Preferred PIPE Placement Agent Warrants met all necessary criteria to be accounted for as equity in accordance with ASC 815-40, Derivatives and Hedging — Contracts in Entity ’ s Own Equity. As such, they are presented within additional paid-in capital within Company’s consolidated statements of changes in stockholders’ equity and consolidated balance sheets. Warrants classified as equity are initially measured at fair value. Subsequent changes in fair value are not recognized as long as the warrants continue to be classified as equity. The initial fair value of each PIPE Warrant and PIPE Placement Agent Warrant issued was determined using the Black-Scholes option-pricing model. All relevant terms and conditions for the PIPE Warrant and PIPE Placement Agent Warrant are identical with the exception of the exercise prices of $ 10.80 and $ 13.50 , respectively. The key inputs into the valuations as of the initial measurement date, December 7, 2022, were as follows: Initial Measurement Risk-free interest rate 3.62 % Expected term remaining (years) 5.00 Implied volatility 89.0 % Closing common stock price on the measurement date, less discount for lack of marketability (1) $ 0.66 (1) As the underlying shares are restricted from sale for a period of 180 days from the date of the 2022 Private Placement, the fair value of the warrants was estimated using the Black-Scholes option pricing model that uses several inputs, including market price of the Company’s common shares at the end of each reporting period (a level one input), less a discount for lack of marketability (a level two input). The discount for lack of marketability was estimated upon consideration of volatility and the length of the lock-up period. Upon initial measurement, the fair value of the PIPE Warrants and PIPE Placement Agent Warrants were determined to be $ 0.42 and $ 0.39 per warrant, respectively, for aggregate fair values of approximately $ 3.1 million and $ 82 thousand , respectively. In the Private Placement, the Company recognized the PIPE Warrants and PIPE Placement Agent Warrants on a relative fair value basis with approximately $ 2.2 million and $ 58 thousand being allocated to each as a component of additional paid-in capital within the Company’s consolidated statements of changes in stockholders’ equity and consolidated balance sheets as of December 31, 2023 and 2022. The initial fair value of each Ladenburg Warrant issued and exercisable at $ 5.424 has been determined using the Black-Scholes option-pricing model. F- 26 The key inputs into the valuations as of the 2023 Ladenburg Agreement initial measurement date, March 21, 2023, were as follows: Initial Measurement Risk-free interest rate 3.98 % Expected term remaining (years) 3.00 Implied volatility 94.0 % Closing common stock price on the measurement date $ 0.52 Upon initial measurement, the fair value of each Ladenburg Warrant was determined to be $ 3.10 , per warrant for a value of approximately $ 93 thousand . The total fair value of the Ladenburg Warrants was recognized by the company as a non-cash expense and allocated to additional paid-in capital within the Company’s consolidated statement of changes in stockholders’ equity and consolidated balance sheet. The initial fair value of each Preferred Placement Agent Warrant issued and exercisable at $ 6.30 has been determined using the Black-Scholes option-pricing model. The key inputs into the valuations as of the October 3, 2023 initial measurement date were as follows: Initial Measurement Risk-free interest rate 4.80 % Expected term remaining (years) 5.00 Implied volatility 85.0 % Closing common stock price on the measurement date $ 0.63 Upon initial measurement, the fair value of each Preferred Placement Agent Warrant was determined to be $ 4.40 , per warrant for a value of approximately $ 3.7 million . The total fair value of the Preferred PIPE Placement Agent Warrants was recognized by the Company as a non-cash expense and allocated to additional paid-in capital within the Company’s consolidated statement of changes in stockholders’ equity and consolidated balance sheet. (13) Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The following fair value hierarchy classifies the inputs to valuation techniques that would be used to measure fair value into one of three levels: Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions. The following table presents information about the Company's assets and liabilities that are measured at fair value on a recurring basis at December 31, 2023 and 2022, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: F- 27 As of December 31, 2023 Total Quoted Prices In Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Liabilities: Public Warrant liability $ 172,500 $ 172,500 $ — $ — Private Placement Warrant liability 6,258 — — 6,258 Preferred Warrants 11,595,477 — — 11,595,477 Total $ 11,774,235 $ 172,500 $ — $ 11,601,735 As of December 31, 2022 Total Quoted Prices In Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Liabilities: Public Warrant liability $ 310,500 $ 310,500 $ — $ — Private Placement Warrant liability $ 10,430 — — 10,430 Total $ 320,930 $ 310,500 $ — $ 10,430 The following table provides a summary of changes in Level 3 fair value measurements for the Private Placement Warrant Liability: Balance, December 31, 2022 $ 10,430 Change in fair value of Private Placement Warrant liability ( 4,172 ) Balance, December 31, 2023 $ 6,258 The following table provides a summary of the changes in Level 3 fair value measurements for the Preferred Warrant liabilities: Fair Value as of October 3, 2023 $ 10,902,784 Change in fair value (1) 692,693 Fair Value as of December 31, 2023 $ 11,595,477 (1) Includes the impact of a $ 3.6 million non-cash gain on termination of private placement warrants consisting of 10,486 Tranche A Warrants with a value of $ 0.1 million, 9,154 forfeited Tranche B Warrants with a value of $ 1.1 million and 22,885 forfeited Tranche C Warrants with a value of $ 2.4 million; the final liability value of the Tranche A Warrants prior to exercise of $ 0.7 million; and the increase in the fair value of the outstanding Preferred Warrants between measurement dates of $ 5.0 million. As of December 31, 2023 and 2022, the Company did not have any other assets or liabilities that are recorded at fair value on a recurring basis. The Company believes that the carrying amounts of its cash and cash equivalents, accounts receivable, accounts payable, notes payable, accrued expenses and other current liabilities approximate their fair values due to their near-term maturities. (14) Income Taxes Net deferred tax assets as of December 31, 2023 and 2022 consisted of the following: F- 28 December 31, 2023 December 31, 2022 Deferred tax assets: Tax Carryforwards $ 10,270,136 $ 5,576,496 Compensation Accruals 2,308,984 1,781,746 Amortizable R&D Intangibles 8,308,095 7,243,110 Other Deferred Tax Assets 1,189,854 1,220,784 Total deferred tax assets 22,077,069 15,822,136 Less valuation allowance ( 19,221,678 ) ( 12,330,481 ) Total deferred tax assets 2,855,391 3,491,655 Deferred tax liabilities: PPE $ 2,579,641 $ 3,240,489 Other Deferred Tax Liabilities 275,750 251,166 Total deferred tax liabilities 2,855,391 3,491,655 Net deferred tax asset (liability) $ — $ — The reconciliation between the Company’s effective tax rate and the statutory tax rate of 21 % includes the following significant items: changes in the valuation allowance and permanent items including the change in fair value of warrant liabilities and equity issuance costs. The rate reconciliation was as follows: December 31, 2023 December 31, 2022 Rate reconciliation: Federal income tax at statutory $ ( 8,855,146 ) 21.00 % $ ( 3,930,187 ) 21.00 % Equity raise 2,757,162 ( 6.54 )% ( 2,227,932 ) 11.90 % Research and development credit RTP ( 340,760 ) 0.81 % ( 821,357 ) 4.39 % Other permanent items ( 452,455 ) 1.07 % ( 24,685 ) 0.13 % Valuation allowance 6,891,199 ( 16.34 )% 7,029,790 ( 37.56 )% $ — — % $ 25,629 ( 0.14 )% In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based upon the level of historical losses and the uncertainty of future taxable income over the periods which the Company will realize the benefits of its net deferred tax assets, management believes it is more likely than not that the Company will not fully realize the benefits on the balance of its net deferred tax asset and, accordingly, the Company has established a valuation allowance on its net deferred tax assets. The valuation allowance increased by approximately $ 6.9 million and increased by approximately $ 7.0 million , respectively, for the years ended December 31, 2023 and 2022. As of December 31, 2023, the Company had approximately $ 40.8 million of federal net operating losses, which were generated after December 31, 2017 and can be carried forward indefinitely under the Tax Act and may generally be used to offset up to 80 % of future taxable income. In addition, the Company had federal tax credit carryforwards of approximately $ 1.7 million and approximately $ 0.9 million , respectively for years ended December 31, 2023 and 2022 which are available to reduce future federal income taxes through 2043. Utilization of the Company’s net operating loss (and tax credit carryforwards) are subject to annual limitation(s) due to an ownership change that occurred as a result of the October 2023 Private Placement. In general, an “ownership change”, as defined by Section 382 of the Internal Revenue Code of 1986, as amended, results from a transaction or series of transaction over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by certain stockholders. However, because the Company was already in a full valuation allowance position, the effect of the ownership was insignificant. Prior to 2022, taxpayers had the option under Section 174 of the Internal Revenue Code to either deduct their research and development costs or capitalize and amortize such costs over a period of not less than 60 months. As part of the tax law changes in the Tax Act enacted in 2017, starting with tax years beginning after December 31, 2021, Congress requires taxpayers to capitalize expenditures that qualify as Section 174 research and development costs and recover them over 5 years for expenditures attributed to domestic research and 15 years for expenditures attributed to foreign research. The 2022 F- 29 effective income tax rate was impacted by the Section 174 capitalization requirement combined with the restriction on net operating losses to only reduce taxable income by 80%. U.S. GAAP provides that the tax effects from uncertain tax positions can be recognized in the consolidated financial statements only if the position is more likely than not of being sustained on audit, based on the technical merits of the position. As of December 31, 2023 and 2022 , there were no uncertain tax provisions. There was no interest or penalties related to income taxes for the years ended December 31, 2023 and 2022 , and there was no accrued interest or penalties associated with uncertain tax positions as of December 31, 2023 and 2022. The Company files tax returns as prescribed by the laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by federal and state jurisdictions, where applicable. The Company’s tax years are still open under the statute from 2020 to present. However, to the extent allowed by law, the taxing authorities may have the right to examine the period from 2016 through 2023 where net operating losses were generated and carried forward and make adjustments to the amount of the net operating loss carryforward amount. The Company is not currently under examination by federal or state jurisdictions. (15) Related Party Transactions For the years ended December 31, 2023 and 2022 , there were no related party transactions with directors, executive officers, or beneficial owners of 5 % or more of any class of the Company's voting securities, immediate family members of any of the foregoing persons, and any entities in which any of the foregoing is an executive officer or is an owner of 5 % or more ownership interest. (16) Employee Benefit Plan The Company sponsors a defined contribution retirement plan. All the Company’s employees are eligible to be enrolled in the employer-sponsored contributory retirement savings plan, which include features under Section 401(k) of the Internal Revenue Code of 1986, as amended, and provides for Company matching contributions. The Company’s contributions to the plan are determined by its Board of Directors, subject to certain minimum requirements specified in the plan. The Company has historically made matching contributions of 100 % on 3 % of the employee contributions, with an additional 50 % match on the next 2 % of employee contributions. The Company made contributions of approximately $ 278 thousand and $ 410 thousand , for the years ended December 31, 2023 and 2022 , respectively. (17) Commitments and Contingencies The Company is not a party to any litigation, and, to its best knowledge, no action, suit or proceeding has been threatened against the Company which are expected to have a material adverse effect on its financial condition, results of operations or liquidity. (18) Subsequent Events Effective January 5, 2024, the Company filed articles of amendment to the Company’s articles of incorporation to affect a one-for-ten reverse split of the Company’s issued and outstanding shares of Common Stock. All references to common stock, warrants and options to purchase common stock, including per share data and related information contained in the accompanying Consolidated Financial Statements have been retroactively adjusted to reflect the effect of the Reverse Stock Split for all periods presented. On January 26, 2024, the Company entered into a Controlled Equity Offering Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co. (“Cantor”), relating to shares of our common stock. In accordance with the terms of the Sales Agreement, the Company may offer and sell shares of our common stock having an aggregate offering price of up to $ 20,000,000 from time to time through Cantor, acting as the Company’s sales agent. As of the date hereof, the Company has no t offered or sold any shares of common stock pursuant to the Sales Agreement. F- 30