What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-03-19 compared with 2025-03-20 · 144 added, 161 removed, 503 unchanged (38% of the section changed)

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Report of Independent Registered Public Accounting Firm (Moss Adams LLP, Campbell, CA, PCAOB ID:

Report of Independent Registered Public Accounting Firm (Baker Tilly US, LLP, San Jose, CA PCAOB ID:

Consolidated Balance Sheets as of December 31, 2025 and 2024

Consolidated Statements of Operations for the years ended December 31, 2025 and 2024

Consolidated Statements of Stockholders' Equity (Deficit) for the years ended December 31, 2024 and 2023

Consolidated Statements of Stockholders' Equity for the years ended December 31, 2025 and 2024

Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024

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We have audited the accompanying consolidated balance sheets of SELLAS Life Sciences Group, Inc.

(the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations, stockholders’ equity (deficit) and cash flows for the years then ended, and the related notes (collectively referred to as the “consolidated financial statements”).

(the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations, stockholders’ equity and cash flows for the years then ended, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2025 and 2024, and the consolidated results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Going Concern Uncertainty

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.

As discussed in Note 2 to the consolidated financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern.

Management’s plans in regard to these matters are also described in Note 2.

The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

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Critical Audit Matters

Critical audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

(1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

We determined that there are no critical audit matters.

/s/ Moss Adams LLP

Campbell, California

/s/ Baker Tilly US, LLP

San Jose, California

March 19, 2026

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Total assets $ 78,345 $ 19,432

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

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Commitments and contingencies (Note 6)

Stockholders’ equity (deficit):

Stockholders’ equity:

Common stock, $ 0.0001 par value;

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Accumulated deficit ( 274,988 ) ( 248,125 )

Total stockholders’ equity (deficit) 9,465 ( 7,976 )

Total liabilities and stockholders’ equity (deficit) $ 19,432 $ 6,219

Total stockholders’ equity 70,871 9,465

Total liabilities and stockholders’ equity $ 78,345 $ 19,432

See accompanying notes to these consolidated financial statements.

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Non-operating income:

Change in fair value of warrant liability — 4

Interest income 1,411 632

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SELLAS LIFE SCIENCES GROUP, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

(Amounts in thousands, except share amounts)

Common Stock Additional Paid-In Capital Accumulated Deficit Total Stockholders' (Deficit) Equity

Common Stock Additional Paid-In Capital Accumulated Deficit Total Stockholders' Equity (Deficit)

Shares Amount

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Issuance of common stock, common stock warrants, and pre-funded warrants, net of issuance costs 27,500,070 3 46,161 — 46,164

Issuance of common stock, net of issuance costs 92,882 289 — 289

Issuance of common stock upon the exercise of pre-funded warrants 13,378,302 1 — — 1

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Balance at December 31, 2024 73,977,459 7 257,583 ( 248,125 ) 9,465

Issuance of common stock upon warrant inducements, net of issuance costs 42,048,754 4 51,055 — 51,059

Issuance of common stock, common stock warrants, and pre-funded warrants, net of issuance costs 8,200,000 1 23,050 — 23,051

Issuance of common stock upon the exercise of pre-funded warrants 13,378,302 1 — — 1

Issuance of common stock upon the exercise of warrants 16,823,735 2 12,615 — 12,617

Issuance of common stock upon the exercise of pre-funded warrants 11,485,040 1 — — 1

Issuance of common stock under employee stock purchase plan 115,449 — 112 — 112

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Non-cash lease expense 597 561

Change in fair value of common stock warrants — ( 4 )

Changes in operating assets and liabilities:

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Net cash used in operating activities ( 28,389 ) ( 35,402 )

Cash flows from investing activities:

Cash paid for acquisition of in-process research and development — ( 5,500 )

Net cash used in investing activities — ( 5,500 )

Cash flows from financing activities:

Proceeds from warrant inducements, net of issuance costs 51,042 —

Proceeds from issuance of common stock, common stock warrants, and pre-funded warrants, net of issuance costs 23,051 46,164

Proceeds from issuance of common stock, net of issuance costs — 289

Proceeds from the exercise of warrants and pre-funded warrants 560 14

Proceeds from the exercise of common stock warrants and pre-funded warrants 12,618 560

Proceeds from employee stock plan purchases 112 98

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Net cash provided by financing activities 86,296 46,758

Net increase (decrease) in cash, cash equivalents, restricted cash, and restricted cash equivalents 11,356 ( 14,595 )

Net increase in cash, cash equivalents, restricted cash, and restricted cash equivalents 57,907 11,356

Cash, cash equivalents, restricted cash, and restricted cash equivalents at the beginning of year 13,986 2,630

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Supplemental disclosures:

Warrant modifications recorded in stockholders' equity (deficit) $ 725 $ —

Fair value of common stock warrants issued in warrant inducements $ 67,412 $ —

Warrant modifications recorded in stockholders' equity $ — $ 725

Increase in operating lease right of use assets and current and non-current operating lease liabilities $ 526 $ 526

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SELLAS’ lead product candidate, galinpepimut-S ("GPS"), is a cancer immunotherapeutic agent licensed from Memorial Sloan Kettering Cancer Center ("MSK") and targets the Wilms Tumor 1 ("WT1") protein, which is present in an array of tumor types.

GPS has potential as a monotherapy or in combination with other immunotherapeutic agents to address a broad spectrum of hematologic, or blood, cancers and solid tumor indications.

SELLAS' second product candidate is SLS009, a small molecule, highly selective cyclin-dependent kinase 9 ("CDK9") inhibitor, which the Company licensed from GenFleet Therapeutics (Shanghai), Inc.

("GenFleet"), for all therapeutic and diagnostic uses in the world outside of mainland China, Hong Kong, Macau and Taiwan ("SLS009 Territory").

Both GPS and SLS009 have potential as monotherapies or in combination with other immunotherapeutic agents to address a broad spectrum of hematologic, or blood, cancers and solid tumor indications.

As used in this Annual Report on Form 10-K, the words the "Company," and "SELLAS" refer to SELLAS Life Sciences Group, Inc.

and its consolidated subsidiaries.

Liquidity and Going Concern

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

The accompanying consolidated financial statements do not reflect any adjustments relating to the recoverability and reclassifications of assets and liabilities that might be necessary if the Company is unable to continue as a going concern.

The Company expects its costs and expenses to increase as it continues to develop its product candidates and progress its current and planned clinical programs.

Pursuant to the requirements of Accounting Standard Codification ("ASC") 205-40, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern , management must evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the consolidated financial statements are issued.

This evaluation initially does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented as of the date these financial statements are issued, but will consider such plans if (1) it is probable that the plans will be effectively implemented within one year after the date the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant condition or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued.

Certain elements of the Company’s operating plan to alleviate the conditions that raise substantial doubt are outside of the Company’s control and cannot be included in management’s evaluation under the requirements of ASC 205-40.

Since inception, the Company has incurred recurring losses and negative cash flows from operations and has an accumulated deficit of $ 248.1 million as of December 31, 2024.

During the year ended December 31, 2024, the Company incurred a net loss of $ 30.9 million and used $ 35.4 million of cash in operations.

The Company continues to expect to generate operating losses and negative cash flows for the next few years and will need additional funding to support its planned operating activities through profitability.

The transition to profitability is dependent upon the successful development, approval, and commercialization of the Company's product candidates and the achievement of a level of revenues adequate to support its cost structure.

As of December 31, 2024, the Company had cash and cash equivalents of $ 13.9 million.

The Company expects its cash and cash equivalents, including aggregate net proceeds received from a registered direct offering that closed on January 29, 2025 (the "January 2025 Registered Direct Offering"), will not be sufficient to fund its current planned operations for at least the next twelve months from the date of issuance of these financial statements.

These conditions give rise to a substantial doubt over the Company’s ability to continue as a going concern.

These consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

On January 29, 2025, the Company consummated the January 2025 Registered Direct Offering with an institutional investor priced at-the-market under Nasdaq rules, pursuant to which the Company agreed to issue and sell 8,200,000 shares of common stock and 11,485,040 pre-funded warrants exercisable for shares of common

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

stock, together with accompanying warrants to purchase up to 19,685,040 shares of common stock.

On October 24, 2025, the Company entered into a Warrant Inducement Agreement (the "October 2025 Inducement") with an institutional investor and holder of certain existing warrants to cash exercise (i) warrants to purchase 6,514,658 shares of common stock at an exercise price of $ 1.535 per share, previously issued in March 2024 (the "March 2024 Warrants"), and (ii) warrants to purchase 15,849,056 shares of common stock at an exercise price of $ 1.325 per share, previously issued in August 2024 (the "August 2024 Warrants").

The March 2024 Warrants and the August 2024 Warrants were exercised at their original issuance exercise price plus $ 0.125 per share of common stock in accordance with Nasdaq rules.

In consideration of the investor's agreement to exercise the March 2024 Warrants and the August 2024 Warrants, the Company agreed to issue new warrants to the investor to purchase up to 22,363,714 shares of common stock at an exercise price of $ 2.00 per share (the "October 2025 Warrants"), which are exercisable immediately and will expire on the five year anniversary of issuance.

The net proceeds to the Company from the October 2025 Inducement were approximately $ 29.1 million, after deducting financial advisory fees and related transaction expenses.

On September 10, 2025, the Company entered into a Warrant Inducement Agreement (the “September 2025 Inducement”) with an institutional investor and holder of certain existing warrants to cash exercise warrants to purchase 19,685,040 shares of common stock, previously issued in January 2025 (the "January 2025 Warrants"), at the original issuance exercise price of $ 1.20 per share.

In consideration of the investor’s agreement to exercise the January 2025 Warrants, the Company agreed to issue new warrants to the Investor to purchase up to 19,685,040 shares of common stock at an exercise price of $ 1.88 per share (the “September 2025 Warrants”), which are exercisable immediately and will expire on the five and one half anniversary of issuance.

The net proceeds to the Company from the September 2025 Inducement were approximately $ 22.0 million, after deducting financial advisory fees and related transaction expenses.

Each share of common stock and accompanying common warrant were sold together at a combined offering price of $ 1.27 , and each pre-funded warrant and accompanying common warrant were sold together at a combined offering price of $ 1.2699 .

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The net proceeds to the Company from the January 2025 Registered Direct Offering were approximately $ 23.1 million, after deducting the placement agents' fees and related offering expenses.

On August 1, 2024, the Company consummated a registered direct offering with an institutional investor priced at a premium to market (the "August 2024 Registered Direct Offering"), pursuant to which the Company agreed to issue and sell 6,370,070 shares of common stock and 9,478,986 pre-funded warrants exercisable for shares of common stock, together with accompanying warrants to purchase 15,849,056 shares of common stock.

Each share of common stock and accompanying common warrant were sold together at a combined offering price of $ 1.325 , and each pre-funded warrant and accompanying common warrant were sold together at a combined offering price of $ 1.3249 .

The common warrants have an exercise price of $ 1.20 per share.

The net proceeds to the Company from the August 2024 Registered Direct Offering were approximately $ 19.5 million, after deducting the placement agent's fees and related offering expenses.

On March 19, 2024, the Company consummated a registered direct offering with two institutional investors priced at-the-market under Nasdaq rules (the "March 2024 Registered Direct Offering"), pursuant to which the Company agreed to issue and sell 11,000,000 shares of its common stock and 2,029,316 pre-funded warrants exercisable for shares of common stock.

Each share of common stock was sold at a purchase price of $ 1.535 and each pre-funded warrant was sold at a purchase price of $ 1.5349 .

The net proceeds to the Company from the March 2024 Registered Direct Offering were approximately $ 18.5 million, after deducting the placement agent's fees and related offering expenses.

In a concurrent private placement, the Company agreed to issue to the two institutional investors exercisable for up to an aggregate of 13,029,316 shares of common stock warrants at an exercise price of $ 1.41 per share.

Subsequent to the closing of the March 2024 Registered Direct Offering, all of the pre-funded warrants issued in the March 2024 Registered Direct Offering have been exercised for shares of common stock.

On January 8, 2024, the Company consummated a public offering on a "reasonable best efforts" basis (the "January 2024 Offering"), issuing 10,130,000 shares of common stock and an aggregate of 1,870,000 pre-funded warrants exercisable for shares of common stock, together with accompanying warrants to purchase an aggregate of 12,000,000 shares of common stock.

Each share of common stock and accompanying common warrant were sold together at a combined offering price of $ 0.75 , and each pre-funded warrant and accompanying common warrant were sold together at a combined offering price of $ 0.7499 .

The net proceeds to the Company from the January 2024 Offering were approximately $ 8.2 million, after deducting the placement agent's fees and related offering expenses.

Subsequent to the closing of the January 2024 Offering, all of the pre-funded warrants issued in the January 2024 Offering have been exercised for shares of common stock.

During the year ended December 31, 2025, the Company received approximately $ 12.6 million in proceeds from the exercise of 16.8 million at an exercise price of $ 0.75 per share.

Subsequent to December 31, 2025, the Company received an additional $ 42.6 million in proceeds from the exercise of 26.4 million warrants at a weighted-average exercise price of approximately $ 1.61 per share.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In December 2020, the Company, together with its wholly-owned subsidiary, SLSG Limited, LLC, entered into an Exclusive License Agreement (the “3D Medicines Agreement”) with 3D Medicines Inc.

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See Note 6, Legal Proceedings.

The Company will require substantial additional financing to commercially develop any current or future product candidates.

If the Company is unable to obtain additional funding on a timely basis, it will be required to scale back its plans and place certain activities on hold.

The Company currently does not have any commitments to obtain additional funds.

The Company's management continues to evaluate different strategies to obtain the

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

required funding for future operations.

These strategies may include public and private placements of equity and/or debt securities, as well as payments from potential strategic research and development collaborations or licensing and/or marketing arrangements with pharmaceutical companies.

Additionally, the Company continues to pursue discussions with global and regional pharmaceutical companies for licensing and/or co-development rights to the Company's product candidates.

There can be no assurance that these future funding efforts will be successful.

As of December 31, 2025, the Company had cash and cash equivalents of $ 71.8 million and restricted cash equivalents of $ 0.1 million.

In accordance with Accounting Standards Codification ("ASC") 205-40, Presentation of Financial Statements - Going Concern , the Company evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about its ability to continue as a going concern within one year after the consolidated financial statements are available to be issued.

The Company expects its cash and cash equivalents, together with the $ 42.6 million in proceeds from warrant exercises received subsequent to December 31, 2025, will be sufficient to fund its current planned operations for at least the next twelve months from the date of issuance of these financial statements, although the Company may pursue additional capital resources through public or private equity or debt financings or by entering into additional license agreements or collaborations with other companies.

Management's expectations with respect to its ability to fund current planned operations is based on estimates that are subject to risks and uncertainties.

If actual results are different from management's estimates, the Company may need to seek additional strategic or financing opportunities sooner than would otherwise be expected.

There is no guarantee that any of these strategic or financing opportunities will be executed or executed on favorable terms, and some could be dilutive to existing stockholders.

If the Company is unable to obtain additional funding on a timely basis, it may be forced to significantly curtail, delay, or discontinue one or more of its planned research and development programs or be unable to expand its operations or otherwise prepare for the potential regulatory approval and commercialization of its product candidates, assuming positive data.

Since inception, the Company has incurred recurring losses and negative cash flows from operations and has an accumulated deficit of $ 275.0 million as of December 31, 2025.

During the year ended December 31, 2025, the Company incurred a net loss of $ 26.9 million and used $ 28.4 million of cash in operations.

The Company expects to continue to generate operating losses and negative cash flows for the next few years and will need additional funding to support its planned operating activities through profitability.

Basis of Presentation and Significant Accounting Policies

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All significant intercompany accounts and transactions have been eliminated upon consolidation.

Unless the context otherwise indicates, reference in these notes to the "Company" refer to SELLAS Life Sciences Group, Inc., and its wholly owned subsidiaries, Private SELLAS, SLSG Limited, LLC, and Sellas Life Sciences Limited.

Unless the context otherwise indicates, reference in these notes to the "Company" refer to SELLAS Life Sciences Group, Inc.

and its wholly owned subsidiaries, SELLAS Life Sciences Group, Ltd., a privately held

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

Bermuda exempted company, SLSG Limited, LLC, and Sellas Life Sciences Limited.

The functional currency of the Company's non-U.S.

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The CODM also monitors the Company's cash and cash equivalents as reported on the consolidated balance sheet, net cash used in operations as reported on the consolidated statement of cash flows, and segment expense information in order to make operational decisions, allocate resources, and plan for future activities.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

Segment expenses consist of the Company's functional expenses, research and development expenses and general and administrative expenses, as reported in the consolidated statement of operations.

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Level 1—Quoted prices in active markets for identical assets or liabilities.

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Level 2—Inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities;

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The following table provides a reconciliation of the components of cash, cash equivalents, restricted cash, and restricted cash equivalents reported in the Company's consolidated balance sheets to the total amount presented in the consolidated statements of cash flows (in thousands):

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

Cash and cash equivalents $ 71,793 $ 13,886

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The Company continually evaluates financial performance, economic conditions and other relevant developments in assessing if an interim period impairment test is necessary.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

The Company's goodwill balance at December 31, 2025 and 2024 was $ 1.9 million.

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and (v) recognize revenue when (or as) the entity satisfies a performance obligation.

The Company only applies the five step model to contracts when it is probable that the entity will collect the

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consideration it is entitled to in exchange for the goods or services it transfers to the customer.

The Company only applies the five step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer.

At contract inception, once the contract is determined to be within the scope of Topic 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations, and assesses whether each promised good or service is distinct.

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There is considerable judgment involved in determining whether it is probable that a significant revenue reversal would not occur.

At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its estimate of the overall transaction price.

At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

estimate of the overall transaction price.

Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment.

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As a result, if factors change and management uses different assumptions, share-based compensation expense could be materially different for future awards.

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

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If performance criteria are not met or are not expected to be met, any compensation expense previously recognized to date associated with the performance-based RSUs will be reversed.

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Restricted Stock Units with Service Conditions Only

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Adjustments to the valuation allowance will increase or decrease the Company’s income tax provision or benefit.

The recognition and measurement of benefits related to the Company’s tax positions requires

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significant judgment, as uncertainties often exist with respect to new laws, new interpretations of existing laws, and rulings by taxing authorities.

The recognition and measurement of benefits related to the Company’s tax positions requires significant judgment, as uncertainties often exist with respect to new laws, new interpretations of existing laws, and rulings by taxing authorities.

Differences between actual results and the Company’s assumptions or changes in the Company’s assumptions in future periods are recorded in the period they become known.

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Basic loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during each period.

The weighted average number of common stock outstanding also includes pre-funded warrants and shares held in abeyance because their exercise requires only nominal consideration for the delivery of the shares.

Diluted loss per share includes the effect, if any, from the potential exercise or conversion of securities, such as warrants, stock options and unvested restricted stock that would result in the issuance of incremental shares of common stock.

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The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted average shares outstanding, as their impact would be anti-dilutive (in thousands):

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Common stock warrants 58,482 55,955

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Recent Accounting Standards Adopted

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures, which requires public entities to disclose significant segment expenses regularly provided to the chief operating decision-maker.

Public entities with a single reporting segment have to provide all disclosures required by ASC 280, including the significant segment expense disclosures.

2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods in fiscal years beginning after December 15, 2024.

This ASU became effective for the Company on January 1, 2024 and did not have a material impact on the consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU No.

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Early adoption is permitted.

The Company is currently evaluating the impact of the ASU on the income tax disclosures within the consolidated financial statements but does not expect a material impact upon adoption.

The Company adopted ASU 2023-09 for the year ended December 31, 2025, and applied the new disclosure requirement prospectively to the current annual period.

Prior period disclosures have not been adjusted to reflect the new disclosure requirements.

See Note 11, Income Taxes .

Recent Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures, which requires disclosure of disaggregated information about certain income statement expense line items in the notes to the financial statements on an interim and annual basis.

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Collaboration and In-License Agreements

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As part of its business, the Company enters into in-licensing agreements with third parties that often require milestone and royalty payments based on the progress of the licensed asset through development and commercial stages.

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The Company also agreed to pay GenFleet single-digit tiered royalties based upon a percentage of annual net sales, with the royalty rate escalating based on the level of annual net sales of SLS009 in the SLS009 Territory ranging from the low to high single digits.

During the year ended December 31, 2024, there were no payments made to GenFleet pursuant to the exclusive license agreement.

During the year ended December 31, 2023, the Company made cash payments of $ 5.5 million under the exclusive license agreement as part of the upfront and technology transfer fee.

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There were no payments made to GenFleet pursuant to the exclusive license agreement during the years ended December 31, 2025 and 2024.

Exclusive License Agreement with Memorial Sloan Kettering Cancer Center ("MSK")

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Such expenses have been included in research and development costs.

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Balance Sheet Accounts

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Accrued expenses and other current liabilities consist of the following (in thousands):

Clinical trial costs $ 3,339 $ 5,672

Compensation and related benefits $ 1,753 $ 1,777

Clinical trial costs 1,540 3,339

Professional fees 190 308

Accrued expenses and other current liabilities $ 3,525 $ 5,466

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

Legal Proceedings, Commitments and Contingencies

Legal Proceedings

From time to time, the Company is subject to various pending or threatened legal actions and proceedings, including those that arise in the ordinary course of its business, which may include employment matters, breach of contract disputes and stockholder litigation.

From time to time, the Company may be subject to various pending or threatened legal actions and proceedings, including those that arise in the ordinary course of its business, which may include employment matters, breach of contract disputes and stockholder litigation.

Such actions and proceedings are subject to many uncertainties and to outcomes that are not predictable with assurance and that may not be known for extended periods of time.

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The arbitration proceeding involves, among other things, the trigger and payment of the relevant milestone payments due to the Company as well as 3D Medicines’ failure to use commercially reasonable best efforts to develop GPS in the 3DMed Territory, and particularly in mainland China.

Legal Proceedings.

Except for this arbitration proceeding, a s of December 31, 2025, there was no other pending or threatened litigation.

The Company has a non-cancelable operating lease for certain executive, administrative, and general business office space for its headquarters in New York, New York, which commenced on June 5, 2020, was amended in February 2022 to add additional space, and had an initial lease term through December 30, 2024.

The Company has a non-cancelable operating lease for certain executive, administrative, and general business office space for its headquarters in New York, New York, which commenced on June 5, 2020 and was amended in February 2022 to add additional space.

The Company assessed the lease amendment for the additional space and determined it should be accounted for as a separate contract.

On October 1, 2025, the Company agreed to extend the expiration date for its office space by one year through September 30, 2027.

The Company assessed the amendment for the lease extension and determined it

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

should be accounted for as a modification of the existing operating leases.

The Company assessed the amendment for the lease extension and determined it should be accounted for as a modification of the existing operating leases.

Accordingly, on the effective modification date, the Company recognized an increase to its operating lease liabilities and corresponding operating lease right-of-use assets of approximately $ 0.5 million for the remeasurement at present value of the remaining lease payments using a discount rate of 13.0 %.

The weighted average discount rate used to account for the Company's operating lease under ASC 842, Leases, as of December 31, 2025 and 2024 was approximately 13.0 %.

As of December 31, 2024 and 2023, the leases had a remaining term of 1.75 years.

Rent expense related to the Company's operating lease was approximately $ 0.6 million and $ 0.5 million for the years ended December 31, 2024 and 2023, respectively.

The Company made cash payments related to operating leases of approximately $ 0.5 million during each of the years ended December 31, 2024 and 2023.

As of December 31, 2025, the lease had a remaining term of 1.75 years.

Rent expense related to the Company's operating lease was approximately $ 0.6 million for each of the years ended December 31, 2025 and 2024.

The Company made cash payments related to operating leases of approximately $ 0.6 million and $ 0.5 million during the years ended December 31, 2025 and 2024, respectively.

Future minimum rental payments under the Company's non-cancelable operating lease are as follows as of December 31, 2025 (in thousands):

SELLAS LIFE SCIENCES GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

Total minimum lease payments:

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Operating lease liabilities $ 1,001

Stockholders’ Equity (Deficit)

Stockholders’ Equity

Preferred Stock

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Warrants classified as equity:

October 2025 Inducement — 22,364 — — 22,364 $ 2.0000 October 2030

September 2025 Inducement — 19,685 — — 19,685 $ 1.8800 March 2031

January 2025 Registered Direct Offering — 19,685 ( 19,685 ) — — $ 1.2000 January 2030

January 2025 Pre-Funded Warrants — 11,485 ( 11,485 ) — — $ 0.0001 n/a

August 2024 Registered Direct Offering 15,849 — ( 15,849 ) — — $ 1.2000 August 2029

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January 2024 Offering 11,467 — ( 4,170 ) — 7,297 $ 0.7500 January 2029

November 2023 Registered Direct 3,652 — — — 3,652 $ 0.7500 January 2029

February 2023 Offering 7,206 — ( 212 ) — 6,994 $ 0.7500 February 2028

April 2022 Offering 766 — — — 766 $ 5.4000 April 2027

April 2022 Offering Modified Warrants 3,864 — — — 3,864 $ 0.7500 January 2029

Pre-Funded Warrants — 13,378 ( 13,378 ) — — $ 0.0001 n/a

Other 366 — — ( 32 ) 334 $ 3.8827 July 2025 - August 2025

Other 15,610 — ( 12,654 ) ( 334 ) 2,622 $ 2.1086 April 2027 - January 2029

55,955 73,219 ( 70,358 ) ( 334 ) 58,482

Subsequent to December 31, 2024, the Company received $ 0.5 million from the exercise of 669,233 warrants to acquire shares of common stock at an exercise price of $ 0.75 per share, and 8,000,000 pre-funded warrants issued in the January 2025 Offering were exercised into shares of common stock.

In connection with the closing of the January 2024 Offering at a combined offering price of $ 0.75 , the Company agreed to (i) reduce the exercise price of an aggregate of 3,863,851 warrants that were issued to certain purchasers in an underwritten public offering that closed on April 5, 2022 (the "April 2022 Offering") to $ 0.75 , (ii) reduce the exercise price of an aggregate of 3,652,300 warrants that were issued in the November 2023 Registered Direct Offering to $ 0.75 , and (iii) extend the termination date of the April 2022 Offering warrants and the November 2023 Registered Direct Offering warrants to January 8, 2029.

Concurrent with the closing of the January 2024 Offering, the exercise price of an aggregate of 7,206,217 warrants which had been issued in an underwritten public offering that closed on February 28, 2023 (the "February 2023 Offering") were also reduced to an exercise price of $ 0.75 per share.

The Company accounted for these amendments as a cost to issue equity with the incremental fair value of approximately $ 0.7 million recognized as an offset to the proceeds received.

Fair value of the equity-classified warrants immediately before and after the modification was estimated using a Black-Scholes option pricing model, and the change in fair value was primarily driven by the change in exercise price.

The Black-Scholes option pricing model also takes into account the historical volatility of the Company's common stock, the estimated remaining term of the warrants, and a risk-free interest rate based on the U.S.

Treasury yield commensurate with the expected term.

Subsequent to December 31, 2025, 26.4 million warrants were exercised at a weighted-average exercise price of approximately $ 1.61 per share for aggregate proceeds of approximately $ 42.6 million.

The Company's outstanding warrants to acquire shares of common stock consist of equity-classified warrants.

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The warrants to acquire shares of common stock do meet the definition of a derivative instrument under ASC 815, but are eligible for the scope exception as they are indexed to the Company’s own stock and would be classified in permanent equity if freestanding.

The Company accounted for the September 2025 Inducement as an exercise of the January 2025 Warrants in exchange for the issuance of the September 2025 Warrants, which is a free-standing financial instrument recorded in stockholders' equity.

Since the September 2025 Warrants were issued to incentivize the exercise of the January 2025 Warrants, incremental fair value of approximately $ 14.7 million as a result of the inducement was accounted for as a non-cash equity issuance cost recognized in stockholders' equity.

The incremental value was obtained from the revaluation of the January 2025 Warrants pre and post inducement exchange using a Black-Scholes option pricing model.

However, there is no net impact to the consolidated statements of stockholders' equity because the warrants are equity classified.

The fair value of the September 2025 Warrants was estimated at approximately $ 30.4 million using a Black-Scholes option pricing model which takes into account the exercise price, the estimated remaining term of the warrants of five and one half years, the historical volatility of the Company's common stock commensurate with the expected term estimated at 114.20 %, a risk-free interest rate of 3.67 % based on the U.S.

Treasury yield commensurate with the expected term, and no future dividends based on the Company's history and expectations.

The Company accounted for the October 2025 Inducement as an exercise of the March 2024 Warrants and August 2024 Warrants in exchange for the issuance of the October 2025 Warrants, which is a free-standing financial instrument recorded in stockholders' equity.

Since the October 2025 Warrants were issued to incentivize the exercise of the March 2024 Warrants and August 2024, incremental fair value of approximately $ 16.1 million as

SELLAS LIFE SCIENCES GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

License Revenue with 3D Medicines, Inc.

a result of the inducement was accounted for as a non-cash equity issuance cost recognized in stockholders' equity.

The incremental value was obtained from the revaluation of the March 2024 Warrants and August 2024 Warrants pre and post inducement exchange using a Black-Scholes option pricing model.

However, there is no net impact to the consolidated statements of stockholders' equity because the warrants are equity classified.

The fair value of the October 2025 Warrants was estimated at approximately $ 37.0 million using a Black-Scholes option pricing model which takes into account the exercise price including the $ 0.125 per share in additional consideration in accordance with Nasdaq rules, the estimated remaining term of the warrants of five years , the historical volatility of the Company's common stock commensurate with the expected term estimated at 117.24 %, a risk-free interest rate of 3.60 % based on the U.S.

Treasury yield commensurate with the expected term, and no future dividends based on the Company's history and expectations.

Licensing Revenue

Exclusive License Agreement with 3D Medicines, Inc.

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The 2017 Equity Incentive Plan was terminated upon the approval of the 2019 Incentive Plan subject to outstanding stock options granted under the 2017 Equity Incentive Plan that remain exercisable through maturity for the Company's employees and directors.

2023 Amended and Restated Equity Incentive Plan

On September 10, 2019, the 2019 Equity Incentive Plan ("2019 Equity Plan") was approved by the stockholders of the Company in connection with the grant of stock-based awards, including stock options, restricted stock, restricted stock units, stock appreciation rights and other types of awards as deemed appropriate.

On June 20, 2023, an amendment to the 2019 Equity Plan was approved by the stockholders of the Company, which amended and restated the 2019 Equity Plan (as amended and restated, the "2023 Amended and Restated Equity Incentive Plan") to increase the number of shares of common stock authorized for issuance under the 2019 Equity Plan by 3,000,000 shares.

The 2023 Amended and Restated Equity Incentive Plan currently allows for issuance of up to approximately 6,036,000 shares of common stock.

SELLAS LIFE SCIENCES GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

2023 Amended and Restated Equity Incentive Plan

On September 10, 2019, the 2019 Equity Incentive Plan ("2019 Equity Plan") was approved by the stockholders of the Company.

The 2023 Amended and Restated Equity Incentive Plan currently allows for issuance of up to approximately 6,036,000 shares of common stock in connection with the grant of stock-based awards, including stock options, restricted stock, restricted stock units, stock appreciation rights and other types of awards as deemed appropriate.

As of December 31, 2025, approximately 1,370,000 shares of common stock were reserved for future grants under the 2023 Amended and Restated Equity Incentive Plan.

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The Company accounts for forfeitures as they occur, therefore, outstanding stock options equal vested and expected to vest stock options.

As of December 31, 2024, there was $ 1.3 million of unrecognized compensation cost related to outstanding stock options that is expected to be recognized as a component of the Company’s operating expenses over a weighted-average period of 1.88 years.

The following table summarizes stock option activity of the Company for the years ended December 31, 2024 and 2023, respectively:

As of December 31, 2025, there was approximately $ 1.0 million of unrecognized compensation cost related to outstanding stock options that is expected to be recognized as a component of the Company’s operating expenses over a weighted-average period of 2.1 years.

SELLAS LIFE SCIENCES GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

The following table summarizes stock option activity of the Company for the years ended December 31, 2025 and 2024, respectively:

Shares (in thousands) Weighted

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The Company granted RSUs pursuant to the Company's 2023 Amended and Restated Equity Incentive Plan that will settle in shares of common stock.

As of December 31, 2024, there was $ 0.7 million of unrecognized compensation cost related to outstanding RSUs that is expected to be recognized as a component of the Company’s operating expenses over a weighted-average period of 1.82 years.

As of December 31, 2025, there was approximately $ 1.0 million of unrecognized compensation cost related to outstanding RSUs that is expected to be recognized as a component of the Company’s operating expenses over a weighted-average period of 2.1 years.

The following table summarizes RSU activity of the Company for the years ended December 31, 2025 and 2024, respectively:

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Unvested at December 31, 2025 897 $ 1.09

2021 Employee Stock Purchase Plan

On April 22, 2021, the Board of Directors adopted the 2021 Employee Stock Purchase Plan ("2021 ESPP") which was approved by the Company's stockholders on June 8, 2021.

The 2021 ESPP allows employees to contribute up to 20 % of their cash earnings, subject to a maximum of $25,000 per year under Internal Revenue Service rules, to be used to purchase shares of the Company's common stock on semi-annual purchase dates.

The 2021 ESPP allows eligible employees to purchase shares of common stock at a price per share equal to 85 % of the

The total fair value of RSUs vested was approximately $ 1.2 million and $ 0.2 million during the years ended December 31, 2025 and 2024, respectively.

Amended and Restated 2021 Employee Stock Purchase Plan

SELLAS LIFE SCIENCES GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

lower of the fair market value of the common stock at the beginning or end of each six-month offering period during the term of the 2021 ESPP.

On April 22, 2021, the Board of Directors adopted the 2021 Employee Stock Purchase Plan ("2021 ESPP") which was approved by the Company's stockholders on June 8, 2021.

The 2021 ESPP allows eligible employees to purchase shares of common stock at a price per share equal to 85 % of the lower of the fair market value of the common stock at the beginning or end of each six-month offering period during the term of the 2021 ESPP.

On June 17, 2025, an amendment to the 2021 ESPP was approved by the stockholders of the Company, which amended and restated the 2021 ESPP (as amended and restated, the "Amended and Restated 2021 ESPP") to increase the number of shares of common stock available for sale under the 2021 ESPP by 800,000 .

During the years ended December 31, 2025 and 2024, 115,449 and 103,853 shares of common stock, respectively, were purchased by employees under the 2021 ESPP for proceeds of approximately $ 0.1 million.

There are approximately 764,000 shares of common stock reserved for issuance under the 2021 ESPP as of December 31, 2025.

The Company's loss before income taxes is as follows (in thousands):

The components of the Company's loss before income taxes are as follows (in thousands):

As of December 31,

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$ ( 26,863 ) $ ( 30,881 )

The components of net deferred tax assets are as follows (in thousands):

The components of the Company's net deferred tax assets (liabilities) are as follows (in thousands):

As of December 31,

Deferred tax assets:

Net operating loss carryforwards $ 16,730 $ 14,116

Stock-based compensation 622 613

Licensing deduction deferral 2,763 3,286

Lease liability 216 194

Capitalized Section 174 research and development 2,185 2,502

Stock-based compensation 797 622

Lease liability 216 216

Other 355 324

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Net deferred tax assets $ 208 $ 200

The components of gross deferred tax liabilities are as follows (in thousands):

As of December 31,

Deferred tax liabilities:

Right of use asset ( 208 ) ( 200 )

Gross deferred tax liability $ ( 200 ) $ ( 184 )

The net deferred tax liabilities are as follows (in thousands):

As of December 31,

Net deferred tax asset $ 200 $ 184

Gross deferred tax liability ( 200 ) ( 184 )

Net deferred tax liability $ — $ —

Gross deferred tax liabilities ( 208 ) ( 200 )

Net deferred tax liabilities $ — $ —

A reconciliation of the provision for income taxes to the amount computed by applying the 21% statutory U.S.

federal income tax rate to income before taxes after the adoption of ASU 2023-09 is as follows:

SELLAS LIFE SCIENCES GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

The provision for income taxes differs from the provision computed by applying the federal statutory rate to net loss before income taxes as follows:

As of December 31,

Year Ended December 31, 2025

federal statutory income tax rate ( 5,641 ) 21.0 %

Valuation allowance 1,917 ( 7.1 ) %

Nontaxable or nondeductible items 140 ( 0.5 ) %

Other ( 47 ) 0.2 %

Foreign rate differential - Bermuda 3,631 ( 13.5 ) %

Effective income tax rate — —

A reconciliation of the provision for income taxes to the amount computed by applying the 21% statutory U.S.

federal income tax rate to income before taxes for years prior to the adoption of ASU 2023-09 is as follows:

Year Ended December 31, 2024

federal statutory income tax rate 21.0 %

State and local taxes, net of federal benefit 0.4 %

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Permanent differences ( 0.5 ) %

Other ( 0.2 ) % ( 0.8 ) %

Effective income tax rate — %

There was no income taxes paid, or refunds received, during the years ended December 31, 2025 and 2024.

There was no income tax benefit or expense for the years ended December 31, 2025 and 2024.

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The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.

The valuation allowance increased by approximately $ 2.1 million for the year ended December 31, 2024, which was primarily driven by increases in net operating loss ("NOL") carryforwards and capitalized research and development, which were partially offset by a decrease related to licensing deduction deferrals.

The valuation allowance increased by approximately $ 2.0 million for the year ended December 31, 2025, which was primarily driven by increases in net operating loss ("NOL") carryforwards and partially offset by decreases related to licensing deduction deferrals and capitalized research and development.

At December 31, 2025, the Company had domestic federal and state net operating loss carryforwards of approximately $ 77.7 million and $ 5.0 million, respectively, available to reduce future taxable income, which expire beginning in 2027.

Under the provisions of the Internal Revenue Code, the net operating losses (“NOL”) and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities.

Under the provisions of the Internal Revenue Code, the NOL and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities.

NOL and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code of 1986, respectively, as well as similar state tax provisions.

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Subsequent ownership changes may further affect the limitation in future years.

The Company has completed several financings since its inception, which may have resulted in a change in control as defined by Sections 382 and 383 of the Internal Revenue Code, or could result in a change in control in the future.

The Company has completed several financings since its inception, which may have resulted in a

SELLAS LIFE SCIENCES GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

change in control as defined by Sections 382 and 383 of the Internal Revenue Code, or could result in a change in control in the future.

Utilization of the net operating loss and tax credits carryforwards may be limited by “ownership change” rules, as defined in Section 382 of the Internal Revenue Code of 1986, as amended, and similar state provisions.

1 unchanged sentence

The Company files income tax returns in the United States and various state jurisdictions.

federal and state income tax purposes, the statute of limitations currently remains open for the years ending December 31, 2021 to present and December 31, 2020 to present, respectively.

In addition, all of the net operating losses and research and development credit carryforwards that may be utilized in future years may be subject to examination.

As of December 31, 2025, all of the Company's federal and state tax returns are open to examination due to net operating loss and research and development credit carryforwards.

The Company does not recognize tax benefits that are not more-likely-than-not to be supported based upon the technical merits of the tax position taken.

In assessing its unrecognized tax benefits, the Company has analyzed its tax return filing positions in all of the federal, state and foreign filing jurisdictions where it is required to file income tax returns, as well as all open years in those jurisdictions.

SELLAS LIFE SCIENCES GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

As of December 31, 2025, the Company has no unrecognized tax benefits or accrued interest or penalties associated with uncertain tax positions.

13 unchanged sentences

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data