TScan Therapeutics, Inc. 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures Our management, under the supervision and with the participation of our Principal Executive Officer (our Chief Executive Officer) and Principal Financial Officer (our Chief Financial Officer), has evaluated the effectiveness of our disclosure controls and procedures as of period end. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or 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 disclosure 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 the evaluation of our disclosure controls and procedures as of December 31, 2025, our Principal Executive Officer and Principal Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level. Management's Report on Internal Control over Financial Reporting Our management 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) to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of consolidated financial statements for external purposes in accordance with U.S. generally accepted accounting principles or “GAAP”. Internal control over financial reporting is a process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that: • Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of our company; • Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and • Provide reasonable assurances regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material adverse effect on our financial statements. Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2025, the end of our fiscal year. Management based its assessment on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). Management’s assessment included evaluation of elements such as the design and operating effectiveness of key financial reporting controls, process documentation, accounting policies, and our overall control environment. 110 Table of Contents Based on this assessment, management has concluded that our internal controls over financial reporting were effective as of December 31, 2025 and provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with GAAP. We reviewed the results of management’s assessment with the Audit Committee of our Board of Directors. Attestation Report of the Registered Public Accounting Firm This Annual Report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Our report was not subject to attestation by our independent registered public accounting firm pursuant to the rules of the Securities and Exchange Commission for “emerging growth companies” that permit us to provide only management’s report in this report. Changes in Internal Control over Financial Reporting No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the three months ended December 31, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Inherent Limitations on Effectiveness of Internal Controls In designing and evaluating the disclosure controls and procedures, management does not expect that our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control systems are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Our management, including our Chief Executive Officer and Chief Financial Officer, believes that our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives and are effective at the reasonable assurance level. However, our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. Item 9B. Other Information None of our directors or “officers,” as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934, adopted or terminated a Rule 10b5-1 trading plan or arrangement or a non-Rule 10b5-1 trading plan or arrangement, as defined in Item 408(c) of Regulation S-K, during the three months ended December 31, 2025. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not Applicable. 111 Table of Contents PART III Item 10. Directors, Executive Officers and Corporate Governance. The information required by this Item 10 will be included in our definitive proxy statement to be filed with the Securities and Exchange Commission, or SEC, with respect to our 2026 Annual Meeting of Stockholders and is incorporated by reference. We have adopted a Code of Business Conduct and Ethics for all of our directors, officers and employees as required by Nasdaq governance rules and as defined by applicable SEC rules. Stockholders may locate a copy of our Code of Business Conduct and Ethics on our website at www.tscan.com. Item 11. Executive Compensation. The information required by this Item 11 will be included in our definitive proxy statement to be filed with the SEC, with respect to our 2026 Annual Meeting of Stockholders and is incorporated by reference. Item 12. Sec urity Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. The information required by this Item 12 will be included in our definitive proxy statement to be filed with the SEC, with respect to our 2026 Annual Meeting of Stockholders and is incorporated by reference. Item 13. C ertain Relationships and Related Transactions, and Director Independence. The information required by this Item 13 will be included in our definitive proxy statement to be filed with the SEC, with respect to our 2026 Annual Meeting of Stockholders and is incorporated by reference. Item 14. Principal Accountant Fees and Services. The information required by this Item 14 will be included in our definitive proxy statement to be filed with the SEC, with respect to our 2026 Annual Meeting of Stockholders and is incorporated by reference. 112 Table of Contents PART IV Item 15. Exhibits, Fin ancial Statement Schedules • For a list of the financial statements included herein, see Index to the Consolidated Financial Statements on page F-1 of this Annual Report on Form 10-K, incorporated into this Item by reference. • 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. • Exhibits: Exhibit Number Description 3.1 Amended and Restated Certificate of Incorporation of TScan Therapeutics, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on July 20, 2021). 3.2 Amended and Restated Bylaws of TScan Therapeutics, Inc. (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on July 20, 2021). 4.1 Registration Rights Agreement made as of January 15, 2021 by and between the Registrant and the other parties thereto (incorporated by reference to Exhibit 4.3 to the Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on April 23, 2021). 4.2 Amended and Restated Nominating Agreement, dated April 22, 2021, by and among the Registrant, Baker Brothers Life Sciences, L.P. and 667, L.P. (incorporated by reference to Exhibit 4.4 to the Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on April 23, 2021). 4.3 Description of the Registrant’s securities registered pursuant to Section 12 of the Securities and Exchange Act of 1934, as amended (incorporated by reference to Exhibit 4.4 to the Registrant's Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 9, 2022). 4.4 Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on May 31, 2023). 4.5 Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on April 17, 2024). 4.6 Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on December 26, 2024). 10.1 Lease, by and between TScan Therapeutics, Inc. and BXP Waltham Woods LLC, dated November 29, 2021 (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on December 2, 2021). 10.2# 2018 Stock Option Plan, as amended and forms of agreements thereunder (incorporated by reference to Exhibit 10.2 to the Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on April 23, 2021). 10.3# Amended and Restated TScan Therapeutics, Inc. 2021 Equity Incentive Plan and form of agreements thereunder (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 14, 2024). 10.4# 2021 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.4 to the Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on April 23, 2021). 10.5† Amended and Restated Exclusive Patent License Agreement by and between the Registrant and The Brigham and Women’s Hospital, Inc. dated April 20, 2021 (incorporated by reference to Exhibit 10.5 to the Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on April 23, 2021). 10.6† Collaboration Agreement by and between the Registrant and Amgen, Inc., dated as of May 8, 2023 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on August 10, 2023). 10.7 Lease by and between PPF OFF 828-830 Winter Street LLC and the Registrant, dated August 13, 2019 (incorporated by reference to Exhibit 10.6 to the Registrant’s Registration Statement on S-1 filed with the Securities and Exchange Commission on April 23, 2021). 113 Table of Contents 10.8 First Amendment to Lease by and between PPF OFF 828-830 Winter Street LLC and the Registrant, dated November 8, 2023 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on November 9, 2023). 10.9 Second Amendment to Lease by and between PPF OFF 828-830 Winter Street LLC and the Registrant, dated October 28, 2024 (incorporated by reference to Exhibit 10.9 to the Registrant's Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 5, 2025). 10.10† Collaboration and License Agreement by and between the Registrant and Novartis Institutes for Biomedical Research, dated as of March 27, 2020 (incorporated by reference to Exhibit 10.8 to the Registrant’s Registration Statement on S-1 filed with the Securities and Exchange Commission on April 23, 2021). 10.11† Non-Exclusive License Agreement by and between the Registrant and Provincial Health Services Authority, dated as of October 15, 2020 (incorporated by reference to Exhibit 10.9 to the Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on April 23, 2021). 10.12 Amended and Restated Royalty Agreement, dated as of June 12, 2018 (incorporated by reference to Exhibit 10.10 to the Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on April 23, 2021). 10.13# Employment Agreement, dated May 25, 2023, by and between the Registrant and Gavin MacBeath, Ph.D (incorporated by reference to Exhibit 10.14 to the Registrant's Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 6, 2024). 10.14# Form of Management Cash Incentive Plan (incorporated by reference to Exhibit 10.18 to the Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on April 23, 2021). 10.15# Employment Agreement, dated July 28, 2021, by and between the Registrant and Zoran Zdraveski (incorporated by reference to Exhibit 10.17 to the Registrant's Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 6, 2024). 10.16# Employment Agreement, dated January 29, 2024, by and between the Registrant and Jason A. Amello (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 13, 2024). 10.17# Employment Agreement, dated April 4, 2024, by and between the Registrant and Chrystal Louis (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 12, 2024). 10.18# Form of Indemnification Agreement between the Registrant and each of its directors and executive officers (incorporated by reference to Exhibit 10.1 to the Registrant’s Registration Statement on Form S-1, filed with the Securities and Exchange Commission on April 23, 2021). 10.19 Loan and Security Agreement, dated September 9, 2022, by and among TScan Therapeutics, Inc., K2 HealthVentures LLC and Ankura Trust Company, LLC (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on September 12, 2022). 10.20† Loan and Security Agreement, dated December 20, 2024, by and among TScan Therapeutics, Inc. and Silicon Valley Bank (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on December 23, 2024). 19* Insider Trader Policy. 21* List of Subsidiaries of Registrant. 23.1* Consent of Independent Registered Public Accounting Firm. 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. 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. 114 Table of Contents 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# Compensation Recovery Policy (incorporated by reference to Exhibit 97 to the Registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 6, 2024). 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 Document 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) * Filed herewith. ** Furnished herewith # Indicates a management contract or any compensatory plan, contract or arrangement. † Certain portions of this exhibit have been omitted because they are not material and would likely cause competitive harm to the registrant if disclosed. Item 16. Form 10-K Summary None. 115 Table of Contents 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 Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized . TScan Therapeutics, Inc. Date: March 4, 2026 By: /s/ Gavin MacBeath Gavin MacBeath, Ph.D. Chief Executive Officer (Principal Executive Officer) Date: March 4, 2026 By: /s/ Jason A. Amello Jason A. Amello Chief Financial Officer (Principal Financial Officer) Each person whose individual signature appears below hereby authorizes and appoints Gavin MacBeath and Jason A. Amello, and each of them, with full power of substitution and resubstitution and full power to act without the other, as his or her true and lawful attorney-in-fact and agent to act in his or her name, place and stead and to execute in the name and on behalf of each person, individually and in each capacity stated below, and to file any and all amendments to this Annual Report on Form 10-K and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing, ratifying and confirming all that said attorneys-in-fact and agents or any of them or their or his substitute or substitutes may lawfully do or cause to be done by virtue thereof. Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the Registrant in the capacities and on March 4, 2026. Signature Title Date /s/ Gavin MacBeath Chief Executive Officer and Director (Principal Executive Officer) March 4, 2026 Gavin MacBeath, Ph.D. /s/ Jason A. Amello Chief Financial Officer March 4, 2026 Jason A. Amello (Principal Financial Officer) /s/ Leiden Dworak Vice President, Finance March 4, 2026 Leiden Dworak (Principal Accounting Officer) /s/ Garry Nicholson Director March 4, 2026 Garry Nicholson /s/ Stephen Biggar Director March 4, 2026 Stephen Biggar, M.D., Ph.D. /s/ Katina Dorton Director March 4, 2026 Katina Dorton, J.D., M.B.A. /s/ Gabriela Gruia Director March 4, 2026 Gabriela Gruia, M.D. /s/ Barbara Klencke Director March 4, 2026 Barbara Klencke, M.D. /s/ R. Keith Woods Director March 4, 2026 R. Keith Woods 116 Table of Contents INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm (PCAOB ID No. 34 ) F- 2 Consolidated Balance Sheets F- 3 Consolidated Statements of Operations and Comprehensive Loss F- 4 Consolidated Statements of Stockholders’ Equity F- 5 Consolidated Statements of Cash Flows F- 6 Notes to Consolidated Financial Statements F- 7 F- 1 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the stockholders and Board of Directors of TScan Therapeutics, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of TScan Therapeutics, Inc. and subsidiary (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, stockholders' equity, and cash flows for the years 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 financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, 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 audits. 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 audits 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 audits, 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 audits 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 audits 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 audits provide a reasonable basis for our opinion. /s/ Deloitte & Touche LLP Boston, Massachusetts March 4, 2026 We have served as the Company’s auditor since 2020. F- 2 Table of Contents TScan Therapeutics, Inc. Consolidated Balance Sheets (in thousands, except share and per share data) December 31, 2025 December 31, 2024 Assets Current assets: Cash and cash equivalents $ 152,406 $ 178,689 Marketable securities - 111,421 Prepaid expenses and other current assets 4,802 2,612 Total current assets 157,208 292,722 Property and equipment, net 8,706 7,242 Right-of-use assets 57,743 64,357 Restricted cash 5,031 5,031 Long-term deposit and other assets 101 1,766 Total assets $ 228,789 $ 371,118 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 1,241 $ 4,278 Accrued expenses and other current liabilities 7,668 15,410 Operating lease liability, current portion 7,167 4,570 Deferred revenue, current portion 2,619 11,698 Total current liabilities 18,695 35,956 Deferred revenue, net of current portion - 1,246 Operating lease liability, net of current portion 54,437 60,739 Long-term debt and accrued interest 32,534 32,072 Other long term liabilities - 135 Total liabilities 105,666 130,148 Commitments and contingencies (Note 10) Stockholders' equity: Preferred Stock, $ 0.0001 par value; 10,000,000 shares authorized; no shares issued and outstanding at December 31, 2025 and 2024 - - Voting common stock, $ 0.0001 par value; 300,000,000 shares authorized; 52,625,035 and 52,314,039 shares issued and outstanding at December 31, 2025 and 2024, respectively 5 5 Non-voting common stock, $ 0.0001 par value; 10,000,000 shares authorized; 4,276,588 shares issued and outstanding at December 31, 2025 and 2024 1 1 Additional paid-in capital 627,979 616,009 Accumulated other comprehensive income - 51 Accumulated deficit ( 504,862 ) ( 375,096 ) Total stockholders' equity 123,123 240,970 Total liabilities and stockholders' equity $ 228,789 $ 371,118 The accompanying notes are an integral part of these consolidated financial statements F- 3 Table of Contents TScan Therapeutics, Inc. Consolidated Statements of Operations and Comprehensive Loss (in thousands, except share and per share data) Year Ended December 31, 2025 2024 Revenue Collaboration and license revenue $ 10,325 $ 2,816 Operating expenses: Research and development 114,150 107,350 General and administrative 31,988 30,287 Total operating expenses 146,138 137,637 Loss from operations ( 135,813 ) ( 134,821 ) Other (expense) income: Interest and other income, net 8,816 12,065 Interest expense ( 2,769 ) ( 3,653 ) Loss on extinguishment of debt - ( 1,090 ) Total other income 6,047 7,322 Net loss $ ( 129,766 ) $ ( 127,499 ) Net loss per share, basic and diluted $ ( 1.00 ) $ ( 1.14 ) Weighted average common shares outstanding—basic and diluted 129,777,415 111,990,417 Comprehensive loss: Net loss $ ( 129,766 ) $ ( 127,499 ) Other comprehensive income (loss): Unrealized gain (loss) on available-for-sale securities ( 51 ) 51 Comprehensive loss $ ( 129,817 ) $ ( 127,448 ) The accompanying notes are an integral part of these consolidated financial statements F- 4 Table of Contents TScan Therapeutics, Inc. Consolidated Statements of Stockholders’ Equity (in thousands, except share data and issuance costs) Additional Accumulated Total Voting Common Stock Non-voting Common Stock Paid-In Other Comprehensive Accumulated Stockholders’ Shares Amount Shares Amount Capital Income Deficit Equity Balances at January 1, 2024 43,552,941 $ 4 4,276,588 $ 1 $ 398,459 $ - $ ( 247,597 ) $ 150,867 Exercise of stock options 586,081 - - - 1,717 - - 1,717 Issuance of common stock under employee stock purchase plan 82,153 - - - 333 - - 333 Issuance of common stock, net of offering costs 4,958,068 1 - - 33,130 - - 33,131 Issuance of pre-funded warrants, net of offering costs - - - - 158,071 - - 158,071 Conversion of convertible debt 3,134,796 - - - 14,750 - - 14,750 Stock-based compensation expense - - - - 9,549 - - 9,549 Net loss - - - - - - ( 127,499 ) ( 127,499 ) Unrealized gain on available-for-sale securities - - - - - 51 - 51 Balances at December 31, 2024 52,314,039 $ 5 4,276,588 $ 1 $ 616,009 $ 51 $ ( 375,096 ) $ 240,970 Issuance of common stock under employee stock purchase plan 234,826 - - - 264 - - 264 Issuance of common stock upon exercise of pre-funded warrants 76,170 - - - - - - - Stock-based compensation expense - - - - 11,706 - - 11,706 Net loss - - - - - - ( 129,766 ) ( 129,766 ) Unrealized loss on available-for-sale securities - - - - - ( 51 ) - ( 51 ) Balances at December 31, 2025 52,625,035 $ 5 4,276,588 $ 1 $ 627,979 $ - $ ( 504,862 ) $ 123,123 The accompanying notes are an integral part of these consolidated financial statements F- 5 Table of Contents TScan Therapeutics, Inc. Consolidated Statements of Cash Flows (in thousands) Year Ended December 31, 2025 2024 Cash flows from operating activities: Net loss $ ( 129,766 ) $ ( 127,499 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation expense 2,866 4,108 Accretion of marketable securities ( 2,409 ) ( 3,897 ) Non-cash interest expense related to loan payable 462 773 Loss on extinguishment of debt - 1,090 Stock-based compensation 11,706 9,549 Changes in current assets and liabilities: Prepaid expenses and other assets ( 525 ) ( 538 ) Right-of-use assets and lease liabilities, net 2,909 1,881 Accounts payable ( 3,011 ) 1,994 Accrued expense and other liabilities ( 7,226 ) 4,532 Deferred revenue ( 10,325 ) ( 2,815 ) Net cash used in operating activities ( 135,319 ) ( 110,822 ) Cash flows from investing activities: Purchases of property and equipment ( 4,407 ) ( 3,825 ) Purchases of marketable securities ( 87,471 ) ( 241,445 ) Proceeds from maturities of marketable securities 201,250 192,657 Net cash provided by (used in) investing activities 109,372 ( 52,613 ) Cash flows from financing activities: Repayment of loan payable, net - ( 17,144 ) Proceeds from borrowings under loan agreement, net - 32,457 Proceeds from issuance of common stock, net of offering costs - 33,131 Proceeds from issuance of pre-funded warrants, net of offering costs - 158,271 Issuance of common stock under employee stock purchase plan 264 333 Proceeds from exercise of stock options - 1,717 Cash paid for debt issuance costs ( 400 ) - Cash paid for financing costs ( 200 ) - Net cash provided by (used in) financing activities ( 336 ) 208,765 Net increase (decrease) in cash, cash equivalents and restricted cash ( 26,283 ) 45,330 Cash, cash equivalents, and restricted cash - beginning of year 183,720 138,390 Cash, cash equivalents, and restricted cash - end of year $ 157,437 $ 183,720 Summary of cash, cash equivalents and restricted cash reported within the consolidated balance sheets: Cash and cash equivalents 152,406 178,689 Restricted cash 5,031 5,031 Total cash, cash equivalents, and restricted cash $ 157,437 $ 183,720 Supplemental disclosure of cash flow information: Cash paid for interest $ 2,307 $ 2,881 Supplemental disclosure of non-cash investing and financing activities: Debt issuance costs not yet paid $ - $ 400 Financing costs not yet paid $ - $ 200 Lease liability arising from obtaining right-of-use asset $ - $ 6,133 Purchase of property and equipment in accounts payable and accrued liabilities $ 7 $ 84 Issuance of common stock upon note conversion $ - $ 14,750 The accompanying notes are an integral part of these consolidated financial statements F- 6 Table of Contents TSCAN THERAPEUTICS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. Nature of Business and Basis of Presentation Nature of Business TScan Therapeutics, Inc. (the Company) is a biotechnology company that was incorporated in Delaware on April 17, 2018 , and has a principal place of business in Waltham, Massachusetts. The Company is a biopharmaceutical company focused on developing a pipeline of T cell receptor (TCR)-engineered T cell (TCR-T) therapies for the treatment of patients with cancer. Risks, Uncertainties and Going Concern The Company is subject to risks common to companies in the biotechnology industry, including, but not limited to, successful development of technology, obtaining additional funding, protection of proprietary technology, compliance with government regulations, risks of failure of preclinical studies, clinical studies and clinical trials, the need to obtain marketing approval for its product candidates and the ability to successfully market its therapies any products that receive approval, fluctuations in operating results, economic pressure impacting therapeutic pricing, dependence on key personnel, risks associated with changes in technologies, development by competitors of technological innovations and the ability to scale manufacturing to large scale production. Product candidates currently under development will require significant additional research and development efforts, including preclinical and clinical testing and regulatory approval prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel and infrastructure and extensive compliance-reporting capabilities. Even if the Company’s development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from therapy sales. The accompanying consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business. The Company has primarily funded its operations with proceeds from sales of capital stock, including the IPO completed in July 2021, issuance of convertible debt in September 2022, issuance of term loan in December 2024 and with payments received under its license and collaboration agreements. Since its inception, the Company has incurred recurring losses, including net losses of $ 129.8 million and $ 127.5 million for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, the Company had an accumulated deficit of $ 504.9 million. The Company expects to continue to generate operating losses in the foreseeable future. The Company expects that its cash and cash equivalents as of December 31, 2025 will be sufficient to fund the Company’s operations for at least the next twelve months from the date of the issuance of the financial statements. The Company will need to obtain substantial additional funding through equity offerings, debt financings, collaborations, strategic alliances and/or licensing arrangements in order to fund its research and development and ongoing operating expenses. The Company may not be able to obtain financing on acceptable terms, when needed or at all, and the Company may not be able to enter into collaborations, strategic alliances or licensing arrangements. The terms of any financing may adversely affect the holdings or the rights of the Company’s stockholders. Any collaborations, strategic alliances or licensing arrangements may require the Company to relinquish rights to certain of its technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to the Company. If the Company is unable to obtain funding, the Company could be forced to delay, limit, reduce or eliminate some or all of its research and development programs, pipeline expansion or future commercialization efforts or grant rights to develop and market product candidates, which could adversely affect its business prospects. Although management will continue to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company to fund continuing operations when needed or at all. 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements reflect the operations of the Company and the Company’s wholly owned subsidiary, TScan Securities Corporation. The accompanying consolidated financial statements have been prepared in conformity with US GAAP. Any reference in these notes to applicable guidance is meant to refer to the authoritative US GAAP as found in the Accounting Standards Codification, or ASC, and Accounting Standards Update, or ASU, of the Financial Accounting Standards Board, or FASB. F- 7 Table of Contents Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of the consolidated financial statements in accordance with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. The Company bases its estimates on historical experience, known trends and other market-specific or relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts and experience. Actual results may differ from those estimates or assumptions. Cash and Cash Equivalents Cash includes cash in readily available checking and money market accounts. Cash equivalents include all highly liquid investments maturing within 90 days from the date of purchase. The cash equivalents consisted of money market funds and government securities. Restricted Cash In connection with the Company’s facility lease agreements, the Company is required to provide letters of credit totaling of $ 5.0 million for the benefit of the landlords to serve as security deposits. As of December 31, 2025 and 2024 , the cash securing the letter of credit was classified as restricted cash (non-current) on the consolidated balance sheets. Marketable Securities The Company classifies all of its marketable securities as available-for-sale based upon its intent with regard to such investments. Unrealized gains on available-for-sale debt securities are reported as a component of accumulated other comprehensive loss in stockholders’ equity. The amortized cost of debt securities in this category is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization is included in interest and other income, net. Realized gains and losses and declines in value judged to be other than temporary on available-for-sale securities, are included in interest and investment income. The cost of securities sold is based on the specific identification method. Interest and dividends on securities classified as available-for-sale are included in interest and other income, net. To determine whether an other-than-temporary impairment exists, the Company considers whether it has the ability and intent to hold the investment until a market price recovery, and whether evidence indicating the recoverability of the cost of the investment outweighs evidence to the contrary. Concentrations of Credit Risk Financial instruments that subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents. The Company’s cash deposits on hand at any one financial institution often exceed federally insured limits. The Company places its cash in financial institutions that management believes to be of high credit quality. The Company does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. Property and Equipment Property and equipment are stated at cost and depreciated using the straight-line method over the estimated useful lives of the respective assets as follows: Estimated useful life Laboratory equipment 3 - 5 years Furniture and fixtures 3 - 5 years Office and computer equipment 3 - 5 years Software 3 - 5 years Leasehold improvements Shorter of the asset's estimated useful life or the remaining lease term F- 8 Table of Contents Major additions and betterments are capitalized; expenditures for repairs and maintenance, which do not improve or extend the life of the respective assets, are charged to operating expense as incurred. Upon retirement or sale, the cost of assets disposed of and the related accumulated depreciation and amortization are removed from the accounts and any resulting gain or loss is included in loss from operations. Impairment of Long-Lived Assets Long-lived assets to be held and used, including property and equipment, are tested for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be fully recoverable. Evaluation of the recoverability of the asset or asset group is based on an estimate of undiscounted future cash flows resulting from the use of the asset or asset group and its eventual disposition. In the event that such cash flows are not expected to be sufficient to recover the carrying amount of the asset or asset group, an impairment loss would be based on the excess of the carrying value of the impaired asset over its fair value. The Company did not record any impairment losses on long-lived assets during the periods presented. Fair Value Measurements Certain assets and liabilities are carried at fair value under US GAAP. Fair value is defined as the exchange price that would be received for 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. Valuation techniques used to measure fair value must maximize the user of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: • Level 1 —Unadjusted quoted prices in active markets that are accessible to the reporting entity at the measurement date for identical assets and liabilities. • Level 2 —Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly for substantially the full term of the asset or liability. Level 2 inputs include the following: • quoted prices for similar assets and liabilities in active markets • quoted prices for identical or similar assets or liabilities in markets that are not active • observable inputs other than quoted prices that are used in the valuation of the asset or liabilities (e.g., interest rate and yield curve quotes at commonly quoted intervals) • inputs that are derived principally from or corroborated by observable market data by correlation or other means • Level 3 —Unobservable inputs for the assets or liability (i.e., supported by little or no market activity). Level 3 inputs include management’s own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk). Leases The Company records leases under ASU No. 2016-02 Leases (Topic 842) whereby the Company determines if an arrangement is or contains a lease at inception. For leases with a term of 12 months or less, the Company has elected to not recognize a right-of-use asset or lease liability. The Company’s operating leases are recognized on the consolidated balance sheets as other noncurrent assets, other current liabilities, and other noncurrent liabilities. The Company does not have any finance leases. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease right-of-use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As the rate implicit on the Company’s leases are not readily determinable, the Company uses an estimate of its incremental borrowing rate for secured borrowings with terms similar to the lease term based on the information available at the lease commencement date in determining the present value of lease payments. Operating lease right-of-use assets also include the effect of any lease payments made, including lease payments made in advance of lease commencement and excludes lease incentives. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense is recognized on a straight-line basis over the lease term. F- 9 Table of Contents Research and Development Costs Research and development costs are expensed as incurred. Research and development costs that are paid in advance of performance (if any) are capitalized as a prepaid expense and amortized over the service period as the services are provided. Accrued Research and Manufacturing Contract Costs The Company has entered into various research and development and manufacturing contracts. These agreements are generally cancelable, and related payments are recorded as the corresponding expenses are incurred. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the research studies or clinical trials and manufacturing activities, including the phase or completion of events, invoices received and contracted costs. Significant judgments and estimates are made in determining the accrued balances at the end of any reporting period. Actual results could differ from the Company’s estimates. The Company’s historical accrual estimates have not been materially different from the actual costs . Patent Costs All patent-related costs incurred in connection with filing and prosecuting patent applications are expensed as incurred due to the uncertainty about the recovery of the expenditure. Amounts incurred are classified as general and administrative expenses. Revenue Recognition The Company accounts for revenue under ASU No. 2014-19, Revenue from Contracts with Customers (ASC 606). ASC 606 applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, certain collaboration arrangements and financial instruments. ASC 606 provides a five-step framework whereby revenue is recognized when control of promised goods or services is transferred to a customer at an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the performance obligations are satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration that it is entitled to in exchange for the goods or services the Company transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses whether the goods or services promised within each contract are distinct and, therefore, represent a separate performance obligation. Goods and services that are determined not to be distinct are combined with other promised goods and services until a distinct combined performance obligation is identified. The Company then allocates the transaction price (that is, the amount of consideration the Company expects to be entitled to from a customer in exchange for the promised goods or services) to each performance obligation and recognizes the associated revenue when (or as) each performance obligation is satisfied. The allocation is based upon standalone selling price. The standalone selling price is the price at which an entity would sell a promised good or service separately to a customer. Because the Company have not sold the same goods or services in our contracts separately to any customers on a standalone basis, the Company estimated the standalone selling price of each performance obligation by taking into consideration internal estimates of research and development personnel needed to perform the research and development services, estimates of expected cash outflows to third parties for services and supplies and typical gross profit margins. The Company enters into collaboration and licensing arrangements that are within the scope of ASC 606, under which the Company may exclusively license to third parties’ rights to develop, manufacture and commercialize its product candidates as well as options to acquire additional rights. The terms of these arrangements typically include payment to the Company of one or more of the following: nonrefundable, upfront license fees; development, regulatory and sales milestone payments; and royalties on net sales of licensed products. Revenue is typically recognized using a cost-to-cost input model as the measure of progress. Significant management judgment is required in determining the level of effort required under an arrangement and the period over which the Company is expected to complete the Company’s performance obligations under an arrangement. The Company evaluates the measure of progress each reporting F- 10 Table of Contents period and, if necessary, adjusts the measure of performance and related revenue recognition. The measure of progress, and thereby periods over which revenue should be recognized, are subject to estimates by management and may change over the course of the research and development and licensing agreement. Such a change could have a material impact on the amount of revenue the Company records in future periods. Amounts received prior to revenue recognition are recorded as deferred revenue in the balance sheets. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as the current portion of deferred revenue in the balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion in the balance sheets. Customer Options If an arrangement is determined to contain customer options that allow the customer to acquire additional goods or services, the goods and services underlying the customer options that are not determined to be material rights are not considered to be performance obligations at the outset of the arrangement, as they are contingent upon option exercise. The Company evaluates the customer options for material rights, or options to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the outset of the arrangement. To date, none of our arrangements have included any material rights. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The observable price of a good or service sold separately provides the best evidence of standalone selling price. However, when standalone selling prices are not readily available, the Company is required to estimate the standalone selling price of each performance obligation. Key assumptions to determine the standalone selling price. Amounts allocated to a material right are not recognized as revenue until the option is exercised or terminates. Milestone Payments For each arrangement that includes milestone payments upon the achievement of performance-based milestones, such as development and regulatory milestones, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant reversal of revenue would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company’s control, such as regulatory approvals, are generally not considered probable of being achieved until those approvals are received. Upfront and ongoing development milestones per the Company’s collaboration and license agreement are not subject to refund if the development activities are not successful. The Company reevaluates the probability of achievement of such milestones and any related constraint at each reporting period, and any adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. To date, the Company has not recognized any milestone revenues. Royalties For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license to the Company’s intellectual property is deemed to be the predominant item to which the royalties relate as it is the primary driver of value, the Company recognizes revenue when the related sales occur in accordance with the sales-based royalty exception. To date, the Company has not recognized any royalty revenue resulting from the Company’s collaboration and licensing agreements. Income Taxes Deferred tax assets and liabilities are recognized for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the consolidated financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. A valuation allowance is provided to reduce the deferred tax asset to an amount, which, more likely than not, will be realized. The Company recognizes the tax benefit from any uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. Interest and penalties associated with uncertain tax positions are recorded as a component of income tax expense. As of December 31, 2025 and 2024 , the Company has no t identified any uncertain tax positions for which reserves would be required. F- 11 Table of Contents Segment Information Operating segments are defined as components of an entity for which discrete information is available for evaluation by the chief operating decision maker, who is the CEO, in deciding how to allocate resources and in assessing performance. The Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions. All of the Company’s assets are held in the U.S. Stock-Based Compensation The Company accounts for stock option awards at fair value, which is measured using the Black-Scholes option-pricing model. The measurement date is generally the date of grant. The Company recognizes stock-based compensation expense over the requisite service period, which is generally the vesting period of the respective award. For awards that include performance-based vesting conditions, stock-based compensation expense is recognized using the accelerated attribution method when the performance condition is deemed to be probable. The Company accounts for forfeitures as they occur. The Company determines the fair value of restricted stock awards in reference to the fair value of its common stock less any applicable purchase price The Company classifies stock-based compensation expense in its consolidated statements of operations in the same manner in which the award recipient’s salary and related costs are classified or in which the award recipient’s service payments are classified. Comprehensive Loss Comprehensive loss includes net loss as well as other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders. The Company’s only element of other comprehensive income was unrealized gains on marketable securities. Net Loss Per Share Basic net loss per share is calculated by dividing net loss by the weighted average common shares outstanding during the period. Diluted net loss per share is calculated by adjusting weighted average common shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury-stock and if-converted methods. For purposes of the diluted net income (loss) per share calculation, convertible debt and stock options are considered to be common stock equivalents. All common stock equivalents have been excluded from the calculation of diluted net loss per share as their effect would be anti-dilutive for all periods presented. Therefore, basic and diluted net loss per share were the same for all periods presented. Recently Adopted Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” This ASU updates income tax disclosure requirements primarily by requiring specific categories and greater disaggregation within the rate reconciliation and disaggregation of income taxes paid by jurisdiction. This ASU is effective for annual periods beginning after December 15, 2024, and is applicable to the Company’s fiscal year beginning January 1, 2025, with early application permitted. The Company adopted this standard for the fiscal year ended December 31, 2025. The adoption of ASU 2023-09 did not have a material impact on the Company's consolidated financial statements and related disclosures. Recently Issued Accounting Pronouncements Not Yet Effective In November 2024, the FASB issued Accounting Standards Update (ASU) 2024-04, Debt-Debt with Conversions and Other Options. ASU 2024-04 is intended to clarify requirements for determining whether certain settlements of convertible debt instruments, including convertible debt instruments with cash conversion features or convertible debt instruments that are not currently convertible, should be accounted for as an induced conversion. This ASU is effective for all entities for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the potential impact of this guidance on its disclosures. In November 2024, the FASB issued Accounting Standards Update (ASU) 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures. ASU 2024-03 is intended to improve disclosures about a public business entity’s expense and provide more detailed information to investors about the types of expenses in commonly presented expense captions. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2026, and interim F- 12 Table of Contents reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the potential impact of this guidance on its disclosures. 3. Property and Equipment Property and equipment consist of the following (in thousands): December 31, 2025 2024 Laboratory equipment $ 21,550 $ 19,371 Leasehold improvements 5,391 3,258 Furniture and fixtures 1,721 1,721 Office and computer equipment 1,496 1,496 Construction-in-progress 118 100 Property and equipment 30,276 25,946 Less: accumulated depreciation and amortization ( 21,570 ) ( 18,704 ) Property and equipment, net $ 8,706 $ 7,242 Depreciation and amortization expense for the years ended December 31, 2025 and 2024 was $ 2.9 million and $ 4.1 million, respectively. 4. Fair Value Measurements The following tables set forth by level, within the fair value hierarchy, the assets carried at fair value (in thousands): Fair value measurements at December 31, 2025 using: Active Markets (Level 1) Observable Inputs (Level 2) Unobservable Inputs (Level 3) Total Assets Cash equivalents – money market funds $ 146,196 $ - $ - $ 146,196 Cash equivalents – government securities 1,987 - - 1,987 Total financial assets $ 148,183 $ - $ - $ 148,183 Fair value measurements at December 31, 2024 using: Active Markets (Level 1) Observable Inputs (Level 2) Unobservable Inputs (Level 3) Total Assets Cash equivalents – money market funds $ 169,744 $ - $ - $ 169,744 Marketable securities – government securities 111,421 - - 111,421 Total financial assets $ 281,165 $ - $ - $ 281,165 Money market funds and government securities are valued by the Company based on quoted market prices, which represent a Level 1 measurement within the fair value hierarchy. There were no transfers among Level 1, Level 2, or Level 3 categories in the periods presented. Assets and Liabilities Not Carried at Fair Value The carrying value of accounts payable and accrued expenses that are reported on the consolidated balance sheets approximate fair value due to the short-term nature of these liabilities. Based on the borrowing rates currently available to the Company for bank loans with similar maturities, the fair value of long-term debt is approximately equal to its carrying amount as of December 31, 2025 and 2024. F- 13 Table of Contents 5. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): December 31, 2025 2024 Accrued employee compensation and benefits $ 4,145 $ 6,845 Accrued research and development 2,458 6,735 Accrued consulting and professional services 568 1,473 Accrued legal services and license fee 301 281 Other 196 76 Total accrued expenses and other current liabilities $ 7,668 $ 15,410 6. Stockholders' Equity ATM Program On May 16, 2023, the Company entered into a sales agreement (the Sales Agreement) with Wedbush Securities, Inc. (Wedbush), as sales agent, pursuant to which the Company could offer, issue and sell up to an aggregate amount of $ 75.0 million of shares of the Company's voting common stock, par value $ 0.0001 per share (Voting Common Stock), from time to time in “at-the-market” (ATM) offerings during the term of the Sales Agreement under a registration statement on Form S-3 (File No. 333-268260) filed with the SEC, which was declared effective on May 16, 2023. No Voting Common Stock has been sold under this Sales Agreement to date. Equity Offerings On June 1, 2023, the Company completed an underwritten public offering resulting in the issuance and sale of (a) 23,287,134 shares of Voting Common Stock, at a price of $ 2.00 per share, and (b) pre-funded warrants (Pre-Funded Warrants) to purchase up to 47,010,526 shares of the Voting Common Stock, with a purchase price of $ 1.9999 per warrant and an exercise price of $ 0.0001 per warrant. The Company received aggregate net proceeds of $ 134.7 million after deducting underwriting discounts, commissions and other offering expenses, with $ 42.4 million allocated to the Voting Common Stock and $ 92.3 million allocated to Pre-Funded Warrants. On April 24, 2024, the Company completed an underwritten public offering resulting in the issuance and sale of (a) 4,958,068 shares of Voting Common Stock, including the partial exercise of the underwriters’ option to purchase 2,485,487 additional shares of Voting Common Stock, at the closing market price on April 16, 2024, of $ 7.13 per share, and (b) Pre-Funded Warrants to purchase up to 18,577,419 shares of the Voting Common Stock, with a purchase price of $ 7.1299 per warrant and an exercise price of $ 0.0001 per warrant. The Company received aggregate net proceeds of approximately $ 161.4 million after deducting underwriting discounts, commissions and other offering expenses, with $ 33.1 million allocated to the Voting Common Stock and $ 128.3 million allocated to Pre-Funded Warrants. On December 27, 2024, the Company completed a registered direct offering with an existing investor for the issuance of Pre-Funded Warrants to purchase up to 7,500,000 shares of the Company's Voting Common Stock, with an exercise price of $ 0.0001 per warrant. The Pre-Funded Warrants were issued at a purchase price of $ 4.00 per warrant, resulting in gross proceeds of approximately $ 30.0 million, before deducting offering expenses of $ 0.2 million. The Pre-Funded Warrants are immediately exercisable subject to certain ownership limitations, have an exercise price of $ 0.0001 per share, may be exercised at any time and do not expire. The Pre-Funded Warrants were determined to be equity classified because they are freestanding financial instruments that are legally detachable and separately exercisable from the equity instruments, are immediately exercisable, do not embody an obligation for the Company to repurchase its shares, permit the holders to receive a fixed number of common shares upon exercise, are indexed to the Company’s common stock and meet the equity classification criteria. In addition, the Pre-Funded Warrants do not provide any guarantee of value or return. As such, proceeds received from the issuance of the Pre-Funded Warrants were recorded as a component of stockholders’ equity within additional paid-in capital. During the year ended December 31, 2025 , the Company issued an aggregate of 76,170 shares of its common stock pursuant to the cashless exercise of 76,178 Pre-Funded Warrants at a weighted average exercise price of $ 0.0001 per share. The Company did no t issue any common stock pursuant to the exercise of Pre-Funded Warrants during the year ended December 31, 2024. Common Stock Reserved for Future Issuance The Company has reserved the following shares of common stock for future issuance: F- 14 Table of Contents December 31, 2025 2024 Stock options outstanding 16,004,393 12,467,782 Pre-Funded Warrants outstanding 73,011,767 73,087,945 Shares available for future grant under 2021 Plan 7,432,023 5,781,492 Shares available for future issuance under 2021 ESPP 1,316,566 985,486 Total shares of common stock reserved 97,764,749 92,322,705 7. Stock-Based Compensation 2021 Equity Incentive Plan The 2021 Equity Incentive Plan (the 2021 Plan) was approved by the Company’s Board on April 22, 2021 and became effective immediately, although no awards were permitted to be granted under the 2021 Plan until July 15, 2021. The 2021 Plan replaced the 2018 Plan, however, awards outstanding under the 2018 Plan continue to be go verned by their existing terms. In addition, shares of common stock subject to awards granted under the 2018 Plan that cease to be subject to such awards by forfeiture or otherwise after the termination of the 2018 Plan will be available for issuance under the 2021 Plan. There were 3,278,048 shares of common stock initially reserved for issuance under the 2021 Plan and as of December 31, 2025 , there were 7,432,023 sh ares of common stock available for issuance. The number of shares reserved for issuance under the 2021 Plan will be increased automatically on the first business day of each fiscal year, commencing in 2022 and ending in 2031. The aggregate number of common shares that may be issued under the 2021 Plan shall automatically increase by a number equal to the least of (a) 4 % of the number of the total outstanding common shares on the last day of the preceding fiscal year, or (b) a number of shares common stock determined by the Company’s Board. 2021 Employee Stock Purchase Plan The 2021 Employee Stock Purchase Plan (the "2021 ESPP") was approved by the Company’s Board on April 22, 2021 and became effective immediately, although no awards were permitted to be granted under the 2021 Plan until July 15, 2021. A total of 254,390 shares of common stock were initially reserved for issuance under the 2021 ESPP. As of December 31, 2025 and 2024, there were 463,359 and 228,533 shares issued under the 2021 ESPP, respectively. As of December 31, 2025, there were 1,316,566 shares of common stock available for issuance under the 2021 ESPP. The number of shares reserved for issuance will automatically be increased on the first business day of each fiscal year, commencing on January 1, 2022 and ending on January 1, 2041. The aggregate number of shares of common stock that may be issued under the 2021 ESPP shall automatically increase by a number equal to the least of (i) one percent ( 1 %) of the total number of shares of common stock actually issued and outstanding on the last day of the preceding fiscal year, or (ii) a number of shares of common stock determined by the Company’s Board. Stock Compensation Stock-based compensation expense related to stock options and the stock purchase plan for the years ended December 31, 2025 and 2024 was classified in the consolidated statement of operations as follows (in thousands): Year Ended December 31, 2025 2024 Research and development $ 5,964 $ 4,846 General and administrative 5,742 4,703 Total stock-based compensation expense $ 11,706 $ 9,549 Stock Options The Company typically grants stock options at exercise prices deemed by the Board to be equal to the fair value of the common stock at the time of grant, based upon the quoted price of the Company’s common stock. The fair value of stock option grants is estimated using the Black-Scholes option-pricing model. The Company lacks sufficient company-specific historical and implied volatility information. Therefore, it estimates its expected stock volatility based on the historical volatility of a publicly traded set of peer companies and expects to continue to do so until such time as it has adequate historical data F- 15 Table of Contents regarding the volatility of its own traded stock price. For options with service-based vesting conditions, the expected term of the Company’s stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is based on the fact that the Company has never paid cash dividends and does no t expect to pay any cash dividends in the foreseeable future. F- 16 Table of Contents The weighted-average for each of the assumptions the Company used to determine the grant-date fair value of options granted were as follows : Year Ended December 31, 2025 2024 Risk free interest rate 4.36 % 4.03 % Expected term (in years) 6.20 6.19 Expected dividend yield 0 % 0 % Expected volatility of underlying common stock 96 % 89 % The following table summarizes the stock option a ctivity: Stock Options Weighted Average Exercise Price Weighted Average Remaining Life (in Years) Intrinsic Value (in thousands) Outstanding January 1, 2025 12,467,782 $ 4.22 8.29 $ 3,912 Granted 6,247,600 2.73 Exercised — — Canceled ( 2,710,989 ) 3.62 Outstanding December 31, 2025 16,004,393 $ 3.74 7.28 $ — Options vested or expected to vest as of December 31, 2025 16,004,393 $ 3.74 7.28 $ — Stock options exercisable as of December 31, 2025 7,472,443 $ 4.34 5.88 $ — Other information related to the option activity for the years ended December 31, 2025 and 2024: Year Ended December 31, 2025 2024 Weighted-average fair value of options granted $ 2.19 $ 4.90 Intrinsic value of options exercised (in thousands) - 1,954 As of December 31, 2025 , the unrecognized compensation cost related to outstanding options was $ 18.8 million, which is expected to be recognized over a weighted-average period of 2.37 years. 8. Income Taxes During the years ended December 31, 2025 and 2024, the Company did not record an income tax provision due to the losses incurred and a full valuation allowance provided on the net deferred tax assets. In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” effective for annual periods beginning after December 15, 2024. ASU 2023-09 requires companies to present a detailed reconciliation of the statutory and effective income tax rates, including specified categories such as state and local taxes, foreign taxes, tax credits, and changes in valuation allowances, to provide greater transparency into the factors affecting the effective tax rate. The standard also mandates disclosure of income taxes paid, disaggregated by federal, state, and foreign jurisdictions, enabling users to better understand the company’s cash tax payments across different tax authorities. Furthermore, companies must describe significant tax positions and valuation allowances, including the nature and amounts of such positions, and the judgments or assumptions underlying their recognition or measurement. ASU 2023-09 permits companies to apply these enhanced disclosure requirements either retrospectively to all periods presented or prospectively to periods beginning after the adoption date; the Company has elected to adopt the standard prospectively. The adoption of ASU 2023-09 had no impact to the Company’s consolidated balance sheets, consolidated statements of comprehensive (loss) income, or consolidated statements of cash flows, as ASU 2023-09 affects disclosures only. On July 4, 2025, the One Big Beautiful Bill Act (the "OBBBA") was enacted, providing taxpayers the option to fully deduct or continue capitalizing and amortizing domestic R&D expenditures under new Code Section 174A, effective for tax years beginning after December 31, 2024. The OBBBA also provides certain eligible taxpayers with the option to accelerate and deduct the remaining unamortized domestic R&D costs incurred during taxable years ending after December 31, 2021 and before January 1, 2025. The Company intends to continue amortizing domestic R&D costs incurred during taxable years ending after December 31, 2021 and before F- 17 Table of Contents January 1, 2025. As of December 31, 2025, $ 129.3 million remains unamortized related to domestic R&D costs. Final elections will be made with the 2025 tax return filing. A reconciliation of the federal statutory income tax rate to the effective rate for the year ended December 31, 2024 is as follows: Year Ended December 31, 2024 Taxes at U.S. statutory rate 21.0 % Changes from statutory rate: State taxes, net of federal benefit 7.5 % Tax credits 5.0 % Share-based compensation ( 0.9 )% Change in valuation allowance ( 30.9 )% Other ( 1.7 )% Effective income tax rate 0.0 % A reconciliation of the federal statutory income tax rate to the effective rate for the year ended December 31, 2025 is as follows (in thousands, except percentages): Year Ended December 31, 2025 U.S. Federal Statutory Income Tax (Benefit) at 21 % $ ( 27,225 ) 21.0 % Domestic Federal Tax Credits R&D Credit ( 3,904 ) 3.0 % Non Taxable or Non Deductible Excess Officer Compensation 1,022 ( 0.8 )% Stock Compensation 954 ( 0.7 )% Other 19 ( 0.0 )% Change in valuation allowance 29,134 ( 22.5 )% Total - 0.0 % Deferred tax assets and liabilities reflect the net tax effects of net operating loss carryovers and temporary differences between the carrying amount of assets and liabilities for financial reporting and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities were as follows (in thousands): Year Ended December 31, 2025 2024 Deferred tax assets: Net operating loss carryforwards $ 48,477 $ 31,332 Tax credits 32,102 25,427 Deferred revenue 716 3,536 Depreciation and amortization 897 1,216 Amortization 386 432 Stock-based compensation 2,319 1,681 Leasehold liability 16,830 17,842 Capitalized R&D costs 62,129 48,315 Other 13,177 9,391 Total deferred tax assets 177,033 139,172 Deferred tax liabilities: Right of use Asset ( 15,775 ) ( 17,582 ) Valuation allowance ( 161,258 ) ( 121,590 ) Net deferred tax assets and liabilities $ - $ - F- 18 Table of Contents In determining the need for a valuation allowance, the Company has given consideration to its cumulative book income and loss positions. The Company has assessed the available means of recovering deferred tax assets, including the ability to carryback net operating losses, the existence of reversing taxable temporary differences, the availability of tax planning strategies and forecasted future taxable income. As of December 31, 2025, the Company maintains a full valuation allowance against its net deferred tax assets. The valuation allowance increased by $ 39.7 million and $ 39.3 million during the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, the Company had U.S. federal net operating loss carryforwards of approximately $ 174.7 million. The U.S. federal net operating losses have an indefinite life carryforward. As of December 31, 2025, the Company had Massachusetts net operating loss carryforwards of approximately $ 186.6 million that expire at various dates through 2045 . As of December 31, 2025, the Company had U.S. R&D federal credit carryforwards of approximately $ 21.8 million that expire at various dates through 2045 . As of December 31, 2025, the Company had U.S. state R&D tax credit carryforwards of approximately $ 13.0 million that expire at various dates through 2040 . Under Sections 382 and 383 of the U.S. Internal Revenue Code, if a corporation undergoes an ownership change, the corporation's ability to use its pre-change net operating loss carryforwards and other pre-change attributes, such as net operating losses and research tax credits, to offset its post-change income and taxes may be limited. In general, an ownership change generally occurs if there is a cumulative change in ownership by 5% stockholders that exceeds 50 percentage points over a rolling three-year period. Similar rules may apply under U.S. state tax laws. The Company has experienced an ownership change in the past and may experience ownership changes in the future as a result of future transactions in its share capital, some of which may be outside the control of the Company. As a result, if the Company earns net taxable income, its ability to use its pre-change net operating loss carryforwards, or other pre-change tax attributes, to offset U.S. federal and state taxable income and taxes is subject to significant limitations. The Company accounted for uncertain tax positions using a more likely than not threshold for recognizing and resolving uncertain tax positions. The evaluation of uncertain tax positions is based on factors that include, but are not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, new audit activity and changes in facts or circumstances related to a tax position. The Company evaluates uncertain tax positions on an annual basis and adjusts the level of the liability to reflect any subsequent changes in the relevant facts surrounding the uncertain positions. The Company accounts for interest and penalties related to uncertain tax positions as part of its provision for income taxes. For the years ended December 31, 2025 and 2024 , there were no accrued interest or penalties in the consolidated statements of operations. The Company is subject to taxation for federal and Massachusetts purposes. As of December 31, 2025 , the Company is subject to examination by these taxing authorities for all years since inception in 2018. 9. Collaboration and License Agreements Amgen On May 8, 2023 , the Company entered into a Collaboration Agreement with Amgen Inc. (the Amgen Agreement) to identify antigens recognized by T cells in patients with Crohn’s disease in accordance with a research plan. Under the terms of the Amgen Agreement, Amgen will retain all global development and commercialization rights. The proceeds from the Amgen Agreements included an upfront payment of $ 30.0 million, which was collected in July 2023. In addition, the Company is eligible to earn success-based milestone payments of over $ 500 million, based upon the achievement of certain clinical development and commercial milestones, as well as tiered single-digit royalty payments on net sales of products developed from the collaboration, subject to reductions set forth in the Amgen Agreement. The Company concluded that Amgen meets the definition of a customer, as the Company is delivering research and development activities and a license of intellectual property. The Company identified performance obligations for research and development activities, the license, data reporting and participation in joint steering and research committees, which were determined to be a single combined performance obligation due to the services and licenses being highly interrelated. For a certain time period during the term of the Amgen Agreement, Amgen has an option to add targets to the collaboration for payments specified in the agreement. Pursuant to the Amgen Agreement, the option for Amgen to select additional targets and to license, develop, and commercialize targets is not a performance obligation at the outset as these are customer options that do not represent material rights. The Company looked to the promises in the arrangement to determine the method of recognition that best depicted the transfer of the services and the satisfaction of the combined performance obligations. The Company concluded that the performance of the research services over the expected research term was the predominant promise within the performance obligation. The Company will recognize the revenue associated with the performance obligation using an input method. The method of measuring progress towards delivery of F- 19 Table of Contents the services incorporates actual internal and external costs incurred, relative to total internal and external costs expected to be incurred to satisfy the performance obligation. Changes in estimates of total internal and external costs expected to be incurred are recognized in the period of change as a cumulative catch-up adjustment. As costs are incurred, the Company will recognized revenue over time. At this time, it is estimated that the research term will be approximately 3 years. The Company determined the $ 30.0 million upfront payment to be the entirety of the consideration to be included in the transaction price. The option to add additional targets was not included in the transaction price as this option was assessed to be improbable at this time. The potential milestone and royalty payments that the Company is eligible to receive were also excluded from the transaction price, as all milestone and royalty amounts were fully constrained based on the assessed probability of achievement. The Company will continue to assess the probability of the option to add additional targets and the probability of milestone achievement throughout the research term and will adjust the consideration in the contract accordingly. For the years ended December 31, 2025 and 2024, the Company recognized $ 10.3 million and $ 2.8 million, respectively, of revenue associated with the Amgen Agreement. As of December 31, 2025, the Company recorded $ 2.6 million of deferred revenue which is classified as short-term. 10. Commitments and Contingencies Leases The Company leases two facilities at 880 Winter Street and 830 Winter Street in Waltham, Massachusetts. Each lease has specified terms and includes renewal options. Given uncertainty as to the Company's intentions with respect to these leases, the renewal options were not deemed reasonably certain. On October 28, 2024, the Company entered into a second lease amendment expanding the rentable space of 830 Winter Street. The amendment provides for an additional 25,628 square feet of space with a commencement date of December 1, 2024 and an expiration date of October 31, 2029 with one option to renew for a five-year period. This amendment resulted in an increase in the lease liability of $ 6.1 million. Summary of lease cost The following table summarizes the presentation in the Company's consolidated balance sheets of its operating leases (in thousands): As of December 31, 2025 2024 Assets: Operating lease assets $ 57,743 $ 64,357 Liabilities: Operating lease liabilities, current 7,167 4,570 Operating lease liabilities, net of current portion 54,437 60,739 Total operating lease liabilities $ 61,604 $ 65,309 The following table summarizes the effect of lease costs in the Company's consolidated statement of operations (in thousands): Years Ended December 31, 2025 2024 Operating lease costs $ 12,997 $ 11,564 Variable lease costs 5,643 3,408 Total lease costs $ 18,640 $ 14,972 During the years ended December 31, 2025 and 2024, the Company made cash payments for operating leases of $ 10.1 million and $ 9.8 million, respectively. F- 20 Table of Contents As of December 31, 2025, future payments of operating lease liabilities are as follows (in thousands): As of December 31, 2025 2026 $ 12,958 2027 13,329 2028 13,712 2029 13,354 2030 and thereafter 30,640 Total future payments of operating lease liabilities 83,993 Less: imputed interest ( 22,389 ) Present value of operating lease liabilities $ 61,604 As of December 31, 2025, the weighted average remaining lease term was 6.3 years and the weighted average incremental borrowing rate used to determine the operating lease liability was 9.9 % . As of December 31, 2024, the weighted average remaining lease term was 7.3 years and the weighted average incremental borrowing rate used to determine the operating lease liability was 10.0 % . Brigham and Women’s License Agreement The Company obtained the worldwide exclusive license to its foundational technology from The Brigham and Women’s Hospital, Inc. (or BWH). The license, as amended, grants worldwide exclusive use to the patent underlying the TargetScan technology in exchange for fees including development milestones and various royalties on product sales should they occur in the future. Royalty Agreement In June 2018, the Company amended and restated an existing royalty agreement with one of its founders. Under the amended and restated royalty agreement, the Company agreed to pay the founder an aggregate royalty of 1 % of net sales of any product sold by the Company or by any of its direct or indirect licensees for use in the treatment of any disease or disorder covered by a pending patent application or issued patent held or controlled by the Company as of the last date that the founder was providing services to the Company as a director or consultant under a written agreement in perpetuity. Royalties are payable with respect to each applicable product for a defined period of time set forth in the royalty agreement. The founder assigned his rights and obligations under the royalty agreement to one of his affiliated entities in January 2021. 11. Loan and Security Agreements K2 HealthVentures LLC On September 9, 2022 (the Closing Date), the Company entered into a Loan and Security Agreement (the Loan Agreement) with K2 HealthVentures LLC (K2HV), pursuant to which convertible term loans in an aggregate principal amount of up to $ 60.0 million is available to the Company in three tranches, subject to certain terms and conditions. The Company drew the first tranche of $ 30.0 million from K2HV on the Closing Date. The Company had the option to draw the second tranche of $ 10.0 million upon the achievement of certain financial and clinical milestones and an uncommitted third tranche of $ 20.0 million could be funded by joint agreement of the Company and K2HV. On the Closing Date, the Company paid a facility fee of $ 0.4 million to K2HV and is subject to an additional 1 % of the principal amount of any amount drawn on third tranche. The term loan was expected to mature on September 1, 2026 (the Maturity Date), and was subject to interest only payments for 24 months, which could be extended to 36 months upon achievement of certain financial and clinical milestones, following which the term loans would amortize in equal monthly installments until maturity. The Company had the ability to repay the loan at any time either in cash or in shares, subject to applicable premiums as specified in the Loan Agreement. The term loans accrued interest at a per annum rate equal to the greater of (i) 8.75 % and (ii) the sum of (A) the prime rate (as last quoted in The Wall Street Journal) and (B) 4.75 %, subject to a cap of 9.90 %. On September 26, 2024, K2HV confirmed to the Company that the amortization commencement date would be October 1, 2025, thereby extending the interest-only period under the Loan Agreement for 12 months. This extension met the definition of an accounting debt modification in accordance with ASC 470-50 and was accounted for prospectively as a yield adjustment, with no resulting gain or loss recognized. F- 21 Table of Contents The lenders could elect at any time following the closing prior to the payment in full of the term loans to convert any portion of the principal amount of the term loans then outstanding into shares of the Company's common stock. The first tranche of the loan was convertible at the option of K2HV at a conversion price of $ 4.785 per share and future tranches could be convertible as specified in the agreement, provided that, such price shall be subject to the applicable conversion price floor and other adjustments in accordance with the Loan Agreement. The embedded conversion option met the derivative accounting scope exception since the embedded conversion option was indexed to the Company’s own common stock and qualifies for classification within stockholders’ equity. The Company had the option to prepay all, but not less than all, of the outstanding principal balance of the term loans under the Loan Agreement subject to a prepayment fee ranging from 4 % to 1 % depending upon when the prepayment occurs. The Company was obligated to pay a final fee equal to 6.00 % of the aggregate amount of the term loans funded (the Exit Fee), to occur upon the earliest of (i) the maturity date, (ii) the acceleration of the term loans, and (iii) the prepayment of the term loans. If, upon equity conversion, K2HV received gross proceeds in an amount equal to at least 1.5 multiplied by the principal amount converted from the sale or other disposition of such Conversion Shares (as defined in the Loan Agreement), then as to such principal amount, the Exit Fee would be reduced to zero. On November 20, 2024, K2HV elected to convert $ 15.0 million of the outstanding principal balance into 3,134,796 shares of the Company's voting common stock at a price of $ 4.785 , in accordance with the agreement. On December 20, 2024 the Company repaid the remaining obligation of the debt agreement, which included $ 15.0 million in remaining principal, a $ 1.8 million Exit Fee, and a $ 0.3 million prepayment fee. The Company recognized a loss from extinguishment of $ 1.1 million. The Company recorded $ 3.6 million in interest expense for the year ended December 31, 2024 . The effective interest rate on the Loan Agreement, including the amortization of the debt discount and issuance costs, and accretion of the Exit Fee, was 12.61 % upon extinguishment. Silicon Valley Bank On December 20, 2024 (the effective date), the Company entered into a Loan and Security Agreement (SVB Loan Agreement) with Silicon Valley Bank, a division of First-Citizens Bank & Trust Company (SVB). Under the SVB Loan Agreement, SVB will extend up to $ 52.5 million in a term loan facility, consisting of a first tranche of $ 32.5 million fully funded on the Effective Date and a second tranche of $ 20.0 million to be available to the Company at the Lender’s sole discretion on or prior to June 30, 2026. The term loans will mature on September 1, 2029 , and will be subject to monthly interest only payments until September 30, 2027, provided the Company achieves certain financial and clinical milestones, following which the term loans will amortize in equal monthly installments until maturity. If the Company does not achieve such financial and clinical milestones by June 30, 2026, the maturity date will be September 1, 2028, and the interest only period will end on September 30, 2026, following which the term loans will amortize in equal monthly installments until maturity. The term loans will accrue interest at a per annum rate equal to the greater of (i) 7.00 % and (ii) the prime rate (as last quoted in The Wall Street Journal), minus 0.75 %; provided that such interest rate shall not exceed 9.75 % per annum. The Company will be liable for a final payment that is due on the earliest to occur of (a) the maturity date, (b) the repayment of the term loans in full, and (c) the date upon which the term loans are accelerated by the Lender, in an amount equal to the aggregate original principal amount of the term loans extended by the Lender to the Company, multiplied by 5.0 % (Exit Fee). In addition, the Company will be liable for a prepayment fee equal to (x) 3.0 % of the principal amount of term loans prepaid during the first year of the term, (y) 2.0 % of the principal amount of term loans prepaid during the second year of the term, and (z) 1.0 % of the principal amount of term loans prepaid thereafter. The term loans will automatically accelerate upon the occurrence of a bankruptcy or insolvency event involving the Company or its subsidiaries. The SVB Loan Agreement contains customary representations and warranties, events of default and affirmative and negative covenants, including covenants that limit or restrict the Company’s and its subsidiaries’ ability to, among other things, dispose of assets, make changes to its business, management, ownership or business locations, merge or consolidate, incur additional indebtedness, grant liens on its assets, pay dividends or other distributions, repurchase equity, make investments, and enter into certain transactions with affiliates, in each case subject to certain thresholds and exceptions. The SVB Loan Agreement does not require the Company to comply with a financial maintenance covenant. As collateral for its obligations under the SVB Loan Agreement, the Company granted the Lender a first-priority security interest on substantially all of the Company’s assets (other than intellectual property), subject to certain exceptions. The Company’s obligations under the SVB Loan Agreement will be guaranteed by each of the Company’s future direct or indirect subsidiaries, subject to certain exceptions. F- 22 Table of Contents The Company recorded $ 2.8 million and $ 0.1 million in interest expense for the years ended December 31, 2025 and 2024 , respectively. The effective interest rate on the SVB Loan Agreement, including the amortization of the debt discount and issuance costs, and accretion of the Exit Fee, was 8.46 % at December 31, 2025. Future principal payments as of December 31, 2025 are as follows (in thousands): 2027 $ 4,063 2028 16,250 2029 12,187 Total principal payments 32,500 Plus: Final payment fee 1,625 Less: unamortized debt discount and final fee ( 1,591 ) Total debt $ 32,534 12. Retirement Plan The Company initiated a defined contribution plan under Section 401(k) of the IRC (the Plan) covering all qualified employees effective January 1, 2019. Employee contributions are voluntary and are determined on an individual basis subject to the maximum allowable under federal tax regulations. The Company made contributions to the Plan of $ 1.3 million and $ 1.0 million for the years ended December 31, 2025 and 2024 , respectively. 13. Restructuring On November 3, 2025, following the Company's alignment with the U.S. Food and Drug Administration (FDA) on the registrational path forward for the TSC-101 program, the Company made the strategic decision to prioritize clinical development of its heme program and pause further enrollment in its solid tumor Phase 1 trial, while focusing its preclinical efforts on in vivo engineering for solid tumors and target discovery in autoimmunity. Pursuant to this strategy, the Company also implemented a workforce reduction of approximately 30 %, or 66 roles. As part of this strategic restructuring, the Company incurred expenses of approximately $ 2.0 million for severance-related benefits and other costs, of which $ 1.6 million is included in research and development expenses and $ 0.4 million is included in general and administrative expenses in the accompanying consolidated statements of operations. Approximately $ 1.0 million of accrued severance-related benefits and other costs are included in accrued expenses on the consolidated balance sheet as of December 31, 2025. These payments are expected to be completed in the fourth quarter of 2026. The following table summarizes the Company's liability recognized in connection with the restructuring (in thousands): Balance as of January 1, 2025 $ - Severance-related benefits and other costs 2,041 Cash payments ( 1,026 ) Balance as of December 31, 2025 $ 1,015 14. Segment Reporting Operating segments are defined as components of the entity for which separate financial information is made available and that is regularly evaluated by the chief operating decision maker (CODM) in making decisions regarding resource allocation and assessing performance. The Company's CODM is its chief executive officer and the Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions. The Company is focused on the development of T cell receptor (TCR)-engineered T cell (TCR-T) therapies for the treatment of patients with cancer. The CODM assesses the Company's performance by reviewing GAAP net loss and significant expenses by function along with the annual budget. The chief operating decision maker considers budget-to-actual variances on a quarterly basis when making decisions about the allocation of operating and capital resources. F- 23 Table of Contents The following table provides information about the Company's single operating segment which includes significant expenses by function along with significant non-cash expense items. Year Ended December 31, 2025 2024 Revenue: Collaboration and license revenue $ 10,325 $ 2,816 Operating expenses: Research and development: Laboratory supplies, research materials and studies 35,157 31,468 Personnel expenses 33,904 31,742 Facility-related and other 20,068 16,669 Clinical studies 16,847 19,245 Stock-based compensation 5,964 4,846 Depreciation expense 2,210 3,380 General and administrative: Personnel expenses 11,415 10,900 Legal and professional fees 7,217 7,380 Facility-related and other 6,958 6,576 Stock-based compensation 5,742 4,703 Depreciation expense 656 728 Other (expense) income: Interest and other income, net 8,816 12,065 Interest expense ( 2,769 ) ( 3,653 ) Loss on extinguishment of debt - ( 1,090 ) Net Loss $ ( 129,766 ) $ ( 127,499 ) 15. Net Loss Per Share Net Loss Per Share Basic and diluted net loss per share was calculated as follows (in thousands, except share and per share data): Year Ended December 31, 2025 2024 Numerator: Net loss $ ( 129,766 ) $ ( 127,499 ) Denominator: Weighted-average common shares outstanding, basic and diluted 129,777,415 111,990,417 Net loss per share, basic and diluted $ ( 1.00 ) $ ( 1.14 ) The 73,011,767 shares of the Company's common stock issuable upon exercise of the Pre-Funded Warrants described in Note 6 are included as outstanding common stock in the calculation of basic and diluted net loss per share. The Company has two classes of common stock, each with identical participation rights to earnings and liquidation preferences, and therefore the calculation of net loss per share as described above is identical to the calculation under the two-class method. The Company excluded the following potential common shares from the computation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect: December 31, 2025 2024 Options to purchase common stock 16,004,393 12,467,782 Potential shares issuable under the ESPP 167,703 138,133 Total 16,172,096 12,605,915 F- 24