What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2025-03-25 compared with 2024-03-28 · 463 added, 993 removed, 503 unchanged (74% of the section changed)

8 unchanged sentences

Based on this assessment, management concluded that our internal control over financial reporting was effective as of December 31, 2024.

No Attestation Report of Registered Public Accounting Firm

This Annual Report on Form 10-K does not contain an attestation report of our registered public accounting firm regarding internal control over financial reporting since the Company, as an “emerging growth company” is not required to provide such report pursuant to Section 404.

Changes in Internal Control over Financial Reporting

6 unchanged sentences

Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

No Attestation Report of Registered Public Accounting Firm

This Annual Report does not contain an attestation report of our registered public accounting firm due to an exemption for “emerging growth companies.”

OTHER INFORMATION

On March 24, 2024, the Board of Directors approved a CEO transition from Someit Sidhu, our Founder, Chief Executive Officer and Director , to Robert Lisicki, effective April 8, 2024.

Sidhu joined Zura Bio as the founding CEO at the time Zura Bio became a public company.

Sidhu led the in-licensing of the Company’s current pipeline molecules including tibulizumab, a bispecific antibody which is a dual antagonist of BAFF and IL-17.

In addition, Dr.

Sidhu completed a successful capital raise enabling the Company to meaningfully advance the development of its assets.

Lisicki , the Company’s current President and Chief Operating Officer , will be promoted to the Company’s Chief Executive Officer on April 8, 2024 .

Sidhu will remain on the Board as a non-independent Director and Mr.

Lisicki will join the Board as a non-independent Director increasing its membership from nine Directors to ten.

Except as otherwise set forth herein, there is no arrangement or understanding between Mr.

Lisicki and any other person pursuant to which he was appointed as the Chief Executive Officer, and there are no transactions in which Mr.

Lisicki has an interest requiring disclosure under Item 404(a) of Regulation S-K.

In connection with the appointment, the Company expects to enter into its standard indemnification agreement with Mr.

Lisicki, on substantially the same terms as the indemnification agreements previously entered into between the Company and each of its directors and executive officers.

Our Board has set May 21, 2025 as the date for its 2025 annual general meeting of shareholders (the “Annual Meeting”).

In accordance with the requirements set forth in our MAA, any shareholder seeking to raise a proposal or to make a nomination for consideration at the Annual Meeting must comply with the requirements set forth in our MAA and the requirements of Rule 14a-8 of the Exchange Act, including by delivering a notice of their proposal or nomination to the Company’s Secretary at 1489 W.

Warm Springs Rd.

#110, Henderson, NV 89014, no later than the close of business on April 4, 2025.

In addition, shareholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide in their notice any additional information required by Rule 14a-19(b) under the Exchange Act.

During the quarter ended December 31, 2024, n o directors or executive officers entered into, modified or terminated, contracts, instructions or written plans for the sale or purchase of the Company’s securities that were intended to satisfy the affirmative defense conditions of Rule 10b5-1.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

1 unchanged sentence

DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

Directors and Executive Officers

Our current Directors and Executive Officers are as follows:

Executive Officers

Founder, Chief Executive Officer and Director

Robert Lisicki

President and Chief Operating Officer

Chief Technology Officer

Secretary and Chief Legal Officer

Kiran Nistala

Chief Medical Officer and Head of Development

Michael Howell

Chief Scientific Officer

Verender Badial

Chief Financial Officer

Non-employee Directors

Amit Munshi (1)(2)

Director, Chairman of the Board

Sandeep Kulkarni (2)(3)

Arnout Ploos van Amstel (3)

Steve Schoch (1)

Jennifer Jarrett (1)

Neil Graham (3)

Parvinder Thiara (2)(3)

(1) Member of the Audit Committee

(2) Member of the Compensation Committee

(3) Member of the Nominating and Corporate Governance Committee

Executive Officers

Someit Sidhu, has served as a Founder, Chief Executive Officer and Director since March 2023.

He will resign from his position as Chief Executive Officer on April 8, 2024 (he will continue to serve as a director).

He is the Co-Founder and has been the CEO of Akaza Bioscience since 2019 and the CEO of Izana Bioscience since 2017 as well as the Co-Founder of Pathios Therapeutics.

Since July 2021, Dr.

Sidhu has served as the Chairman and Chief Executive Officer of JATT Acquisition Corp.

Sidhu has broad expertise covering various topics in the life sciences industry.

Prior to these companies, he advised many large international pharmaceutical companies as a management consultant at McKinsey & Co, where he primarily focused on Pharmaceutical R&D and Portfolio Strategy.

Sidhu gained medical experience during his time in Cardiology and General Surgery after graduating from the Oxford Medical School.

We believe Dr.

Sidhu is well-qualified to serve as a Director due to his extensive operational and investment experience in the life sciences industry.

Badial, has served as Chief Financial Officer since March 2023.

He has more than 20 years of experience as an investment banker and is currently Managing Director of Cryfield Investments, which he founded in 2015 and is responsible for the corporate finance services and capital fundraising activities.

Between 1997 and 2015, Mr.

Badial held executive functions in the Equity Capital Markets departments of Rothschild (ABN AMRO) and Societe Generale, allowing him to leverage rich experience in structuring and executing equity capital markets transactions as well as building up an extensive network.

Badial also held the role of Managing Director with Rothschild (ABN AMRO) and Societe Generale within the investment banks and is experienced in both buy- and sell-side advisory transactions incorporating leveraged and structured equity and debt finance solutions with a key focus on financial sponsor portfolios in pharma and healthcare.

Badial brings unique capabilities for the target identification and business combination processes based on his expertise from acquiring and funding numerous corporates, raising capital for M&A and IPOs coupled with significant expertise in analyzing potential financial or management improvements to operational businesses.

Badial graduated with an honor’s degree from the London School of Economics & Political Science.

Kim Davis is our Secretary and Chief Legal Officer and served in such position at Legacy Zura since September 2022.

Previously, Ms.

Davis served as Vice President, Deputy General Counsel and Chief Compliance Officer of Arena Pharmaceuticals, Inc.

from 2020 to until its acquisition by Pfizer in September 2022.

From 2014 to 2020, Ms.

Davis was Vice President and Chief Compliance Officer of Kaleo, Inc.

From 2011 to 2014, Ms.

Davis was Vice President and Health Care Law & Compliance Officer of Impax Laboratories, Inc.

(now Amneal Pharmaceuticals LLC).

In previous roles, Ms.

Davis was Executive Director from 2008 to 2011 and Associate General Counsel from 2000 to 2008 at Amgen, Inc.

Davis holds a Juris Doctor from Pepperdine University School of Law, and a Bachelor of Arts in Business Management from Sweet Briar College.

Gary Whale has served as Chief Technology Officer since the Business Combination and served in such position at Legacy Zura since February 2023.

Before joining Legacy Zura, Dr.

Whale was employed as Vice President, Global Head of Technical Operations at EUSA Pharma, starting in May 2020.

until the company was successfully sold in 2022 to a larger Italian specialty care company, Recordati S.p.A.

Prior to this, from January 2018 to April 2020, Dr.

Whale was Chief Operating Officer at VHsquared, a biotech start-up company.

From March 2014 to January 2018, Dr.

Whale was VP CMC & Manufacturing Operations at VHsquared.

Previously, Dr.

Whale spent a number of years at other companies, such as:

Emergent BioSolutions from January 2007 to June 2013, Microscience Ltd from September 2002 to May 2007 and Proctor and Gamble from November 1996 to October 1999, all of which were in a technical operations role.

Whale holds a bachelor’s degree in Biochemistry and a master’s degree in Microbiology from the University of London, and a PhD in the purification and characterization of bacterial cell surface antigens from Robert Gordon University.

Michael Howell has served as Chief Scientific Officer since April 2023, and previously served as Senior Vice President for Translational Medicine of Zura since December 2022.

Howell concurrently serves as Founder of Mountaineer Biosciences, Inc since January 2022, as Scientific Advisor of Ornovi, Inc.

since August 2020 and as Co-Founder of Galileo Biosystems Inc.

since June 2021.

Previously, Dr.

Howell served as Scientific Advisor of Galileo Biosystems Inc.

from February 2020 until June 2021.

From August 2020 to November 2022, Dr.

Howell was Chief Scientific Officer of DermTech, Inc.

Prior to this, Dr.

Howell was Senior Director of Translational Medicine of Incyte Corporation from October 2016 to August 2020.

In previous roles, Dr.

Howell was Principal Scientist and Associate Director at MedImmune, LLC from December 2013 to November 2016, Senior Director of Biomarker and Discovery Research at the Immune Tolerance Network from June 2012 to December 2013, and Principal Scientist of Boehringer Ingelheim GmbH from April 2010 to August 2012.

Howell holds a Bachelor of Science in Biology and Chemistry from Messiah University and a Ph.D.

in Microbiology and Immunology from West Virginia University School of Medicine.

Kiran Nistala has served as Chief Medical Officer and Head of Development since November 2023.

He is an experienced physician and immunologist with nearly two decades of expertise in translational medicine and the strategic design of clinical trials, spanning a diverse spectrum of medical disorders.

His primary areas of specialization encompass rheumatology, dermatology, and respiratory disorders.

From March 2020 to October 2023, Dr.

Nistala served as the Vice President of late-stage clinical development in Immunology at AstraZeneca, where he was instrumental to their therapeutic build in autoimmune disease.

His primary focus was on Immunology programs aimed at addressing conditions such as lupus, myositis, and eosinophilic disorders.

He led the clinical team and set the strategy for AZ’s scleroderma Phase 3 trial.

Prior to his tenure at AstraZeneca, Dr.

Nistala held a series of increasingly senior positions at GlaxoSmithKline from December 2015 to February 2020, where his contributions ranged from pivotal roles in research strategy, immune safety governance boards, design of clinical protocols and championing translational medicine initiatives.

In addition to his corporate roles, Dr.

Nistala served as an Honorary Consultant in pediatric rheumatology at Great Ormond Street Hospital for Children NHS Foundation Trust in the United Kingdom, demonstrating his commitment to both academic and clinical excellence.

Nistala earned a bachelor’s degree in Psychology from the University of Cambridge in 1993, an MBBS in 1996 and a PhD in Immunology in 2010 from University College London, and completed his scientific training with a prestigious Clinician Scientist Fellowship from the Wellcome Trust in 2015.

Robert Lisicki has served as President and Chief Operating Officer since January 2024.

He will become our Chief Executive Officer and a director on April 8, 2024.

He is an experienced executive leader with a career spanning 30 years in the biopharmaceutical industry.

Robert Lisicki has been serving on the boards of Adiso Therapeutics and Cadrenal Therapeutics, Inc.

since October 2023 and July 2023, respectively.

He served as the Chief Commercial Officer at Arena Pharmaceuticals from October 2018 to March 2022, a prominent biopharmaceutical company acquired by Pfizer for $6.7 billion in 2022.

At Arena, Mr.

Robert Lisicki had accountability for building the company’s global commercial infrastructure and contributed to its mergers and acquisitions activities totaling nearly $8.0 billion.

Prior to Arena, Mr.

Robert Lisicki served as Vice President and General Manager of Inflammation and Cardiovascular at Regeneron Pharmaceuticals.

In this dual role, he led both commercial and developmental initiatives.

His career also includes senior leadership roles as CEO and Board Member, InCarda Therapeutics;

CCO, Daiichi Sankyo, Inc.;

and VP, Amgen, with his initial experience in sales and marketing at The Janssen Pharmaceutical Companies of Johnson & Johnson.

He holds a Bachelor of Science degree in Finance and Economics from the State University of New York, Albany, New York.

Non-employee Directors

Munshi has served as the Chairman of our Board of Directors since March 2023 and with Legacy Zura since November 2022.

Currently, Mr.

Munshi is the Chief Executive Officer & President at ReNAgade Therapeutics.

Munshi was President and Chief Executive Officer of Arena Pharmaceuticals Inc.

from May 2016 to March 2022 and a member of the Board of Directors from June 2016 until March 2022, when Arena Pharmaceuticals was sold to Pfizer Inc.

Previously, Mr.

Munshi served as President and Chief Executive Officer and as a director of 288 Epirus Biopharmaceuticals, Inc., a biopharmaceutical company focused on biosimilars, and Percivia LLC, a biotechnology company which was sold to Johnson & Johnson.

Subsequent to an asset sale, in July 2016, Epirus filed a voluntary Chapter 7 petition in the United States Bankruptcy Court for the District of Massachusetts.

Prior to Epirus and Percivia, Mr.

Munshi was a co-founder and served as Chief Business Officer of Kythera Biopharmaceuticals, Inc.

from 2005 to 2010, which was sold to Allergan plc, and held multiple leadership positions at Amgen Inc.

from 1997 to 2005, including General Manager, Nephrology Europe.

He has served as the Chairman of the Board of Enterprise Therapeutics since January 2020.

Simultaneously, Mr.

Munshi has also served as a member of the Board of Directors and Audit Committee of Galecto Inc.

(GLTO) since January 2020.

Munshi likewise served as a member of the Board and Audit Committee of Pulmatrix Inc.

(PULM) from June 2017 until March 2021.

Additionally, Mr.

Munshi currently serves as a director of two U.S.

subsidiaries of Zura:

Zura Bio Inc.

and Z33 Bio Inc.

Munshi holds a B.S.

in Economics and a B.A.

in History from the University of California, Riverside, and an M.B.A.

from the Peter F.

Drucker School of Management at Claremont Graduate University.

Munshi has more than 30 years of global biopharmaceutical industry experience in executive management, business development, product development and portfolio management.

Munshi’s vast executive management and business experience in the global biopharmaceutical industry and in-depth knowledge of product development gives him the qualifications, attributes and skills to serve as one of our directors.

Arnout Ploos van Amstel, has served as a director since November 9, 2023 is an executive leader in Life Sciences/Biotech with more than 30 years of business and operations experience in a wide variety of leadership positions and geographies.

Arnout consistently excelled in devising and implementing comprehensive strategies across Development, Medical, and Commercial-Access domains.

He founded Apaxcel Life Sciences GmbH in April 2019, a consulting company that supports biopharma customers in creating strategies that accelerate outcomes.

He is currently serving as strategic consultant through Apaxcel Life Sciences GmbH.

He is a founder of MoonLake Immuntherapeutics AG since January 2020, a biotech company dedicated to next-level therapies in inflammatory diseases.

From July 2010 to March 2019, he worked as the President and Managing Director and then Senior Vice President for Novartis, leading its Global Business Unit Immunology/Dermatology where he achieved remarkable portfolio growth, notably with the success of COSENTYX® (secukinumab), XOLAIR® (omalizumab) for chronic spontaneous urticaria (CSU), and with the consistent growth of "orphan blockbuster" ILARIS® (canakinumab).

Ploos van Amstel’s experience includes leadership roles at Wyeth Pharmaceuticals and Novartis with executive positions in the US, Canada, Greece, the Netherlands and Switzerland.

He was born and raised in the Netherlands and holds a Master’s degree in Economics from the University of Groningen.

Jennifer Jarrett, has served as a director since March 2023 and with Legacy Zura since January 2023.

Jarrett has served as Chief Operating Officer of Arcus Biosciences, a biotechnology company, since October 2020.

From January 2019 through September 2020, she served as Vice President of Corporate Development and Capital Markets of Uber Technologies, a technology company, and from June 2018 to January 2019 served as Arcus Bioscience’s Chief Operating Officer and Chief Financial Officer and as its Chief Business Officer and Chief Financial Officer from March 2017 to June 2018.

From March 2016 to October 2016, Ms.

Jarrett was the Chief Financial Officer of Medivation, a commercial biopharmaceutical company, which was acquired by Pfizer.

Before Medivation, Ms.

Jarrett spent 20 years in investment banking, most recently at Citigroup where she ran the firm’s west coast life sciences investment banking practice, and prior to that at Credit Suisse and Donaldson, Lufkin & Jenrette.

Jarrett currently serves on the board of Arcus Biosciences, Inc.

and Syndax Pharmaceuticals, Inc., each of which is a publicly traded company, and previously served on the boards of Arena Pharmaceuticals, Inc.

Audentes Therapeutics, Inc.

and Consonance-HFW Acquisition Corp.

Jarrett received a B.A.

in Economics from Dartmouth College and her M.B.A.

from the Stanford Graduate School of Business.

We believe she is well-qualified to serve as a director due to her extensive finance and operational experience.

Neil Graham M.B.B.S., M.D., M.P.H.

, has served as a director since March 2023 and with Legacy Zura since January 2023.

Graham, is an expert in immunology and inflammation with more than 30 years’ experience in global drug development and commercialization, crossing early and late-stage clinical trials in dermatology, allergy, rheumatology, virology, and pulmonology.

From February 2021 to January 2022, Dr.

Graham served as Chief Medical Officer of Tiziana Life Sciences LTD, a biotechnology company.

Prior to Tiziana, Dr.

Graham was VP-Strategic Program Direction & Immunology at Regeneron Pharmaceuticals, Inc.

from April 2010 to January 2020.

In previous roles, Dr.

Graham occupied the position of Chief Operating Officer at XTL Biopharmaceuticals Ltd.

from January 2002 to June 2005, SVP-Program & Portfolio Management at Trimeris, Inc.

from June 2005 to February 2007, Senior Vice President-Program & Portfolio at Vertex, Inc.

from April 2007 to November 2009 and Associate Professor at Johns Hopkins Bloomberg School of Public Health from October 1989 to March 1997.

Graham currently serves on the boards of ASLAN Pharmaceuticals and Pharmaxis Ltd.

Graham holds an MD, MPH, MBBS from the University of Adelaide.

We believe he is well-qualified to serve as a director due to his extensive scientific and operational experience.

Parvinder Thiara has served as a member of our board of directors since June 2022.

Thiara founded Athanor Capital in January 2017, a New York-based hedge fund manager, and currently serves as its Chief Investment Officer.

Thiara also serves as a member of Tourmaline Bio’s board of directors since September 2022.

Previously, Mr.

Thiara held various roles at D.E.

Shaw & Co., including most recently as a Senior Vice President.

Thiara earned a B.A.

degree in Chemistry from Harvard College and an M.Sc.

degree in Theoretical Chemistry from Oxford University as a Rhodes Scholar.

ZB believes Mr.

Thiara is qualified to serve on its board of directors due to his medical and scientific background, combined with his significant experience as a manager and investor in the life sciences industry.

Kulkarni, M.D., has served as a director of Zura since March 2023 and served as a Director of Legacy Zura since March 31, 2022.

He is currently the Chief Executive Officer and co-founder of Tourmaline Bio, LLC, since September 2021.

Prior to this, Dr.

Kulkarni was a Managing Director at KVP Capital from August 2020 to June 2022.

Prior to KVP, Dr.

Kulkarni served in multiple roles at RoivantSciences from July 2018 to June 2020, including as the Chief Operating Officer of lmmunovant, Inc, Vice President Special Projects, and Ombudsman to the Investment Committee.

From September 2017 to February 2018, Dr.

Kulkarni was Senior Investment Analyst at Consonance Capital, a healthcare investment firm, and Investment Analyst on the Life Sciences team at QVT Financial LP from April 2013 to August 2017.

From August 2009 to May 2012, Dr.

Kulkarni was a consultant, then Project Leader at the Boston Consulting Group, Inc., where he focused on the biopharma sector.

Kulkarni earned a B.A.

in Economics from Harvard College and an M.D.

from the University of California, San Francisco.

Steve Schoch, has served as a director since March 2023 and with Legacy Zura since January 2023.

He served as a member of the Board of Directors of Arena Pharmaceuticals and chaired the Audit Committee from June, 2021 until the company was acquired by Pfizer in March of 2022.

Schoch currently serves as Chief Operating Officer and Chief Financial Officer of FLYR Labs, a position he has held since 2022.

Prior to joining FLYR Labs, Mr.

Schoch served as Chief Financial Officer at 23andMe, Inc.

from 2018 to 2022.

Schoch served as the Chief Executive Officer of Miramax Films NY, LLC from 2012 – 2017, while concurrently serving as Miramax’s Chief Financial Officer, a position he held beginning in 2010.

From 2001 to 2010, Mr.

Schoch held various senior financial positions at Amgen, Inc., including Corporate Controller and divisional Financial Vice President.

He served as the Executive Vice President and Chief Financial Officer of eToys, Inc.

from 1999 to 2001.

Prior to eToys, Inc., Mr.

Schoch held a variety of financial positions in the media industry, including at The Walt Disney Company and the Times Mirror Company.

Schoch holds a B.S.

in Civil Engineering degree from Tufts University and a M.B.A.

degree from the Tuck School of Business Administration, Dartmouth College.

Director Independence

Nasdaq requires that a majority of our board must be composed of “independent directors,” which is defined generally as a person other than an officer or employee of the company or its subsidiaries or any other individual having a relationship, which, in the opinion of the company’s board of directors would interfere with the director’s exercise of independent judgment in carrying out the responsibilities of a director.

Based on information provided by each director concerning his or her background, employment and affiliations, our board of directors determined each of Amit Munshi, Sandeep Kulkarni, Arnout Ploos van Amstel, Steve Schoch, Jennifer Jarrett, Neil Graham and Parvinder Thiara is “independent” as that term is defined under Nasdaq listing standards.

Our independent directors will have regularly scheduled meetings at which only independent directors are present.

Any affiliated transactions will be on terms no less favorable to us than could be obtained from independent parties.

Any affiliated transactions must be approved by a majority of our independent and disinterested directors.

Audit Committee

The members of our audit committee are Amit Munshi, Jennifer Jarrett and Steve Schoch, each of whom can read and understand fundamental financial statements.

Each of Amit Munshi, Jennifer Jarrett and Steve Schoch is independent under the rules and regulations of the SEC and Nasdaq listing standards applicable to audit committee members.

Steven Schoch serves as the chair of the audit committee.

The Zura board has determined that Steven Schoch qualifies as an audit committee financial expert within the meaning of SEC regulations and meets the financial sophistication requirements of Nasdaq.

In arriving at these determinations, the Zura board has examined each audit committee member’s scope of experience and the nature of their employment.

The primary purpose of the audit committee is to discharge the responsibilities of our board of directors with respect to the corporate accounting and financial reporting processes, systems of internal control and financial statement audits, and to oversee the independent registered public accounting firm.

Specific responsibilities of the audit committee will include:

● helping the board of directors oversee corporate accounting and financial reporting processes;

● managing the selection, engagement, qualifications, independence and performance of a qualified firm to serve as the independent registered public accounting firm to audit the financial statements;

● discussing the scope and results of the audit with the independent registered public accounting firm, and reviewing, with management and the independent accountants, the interim and year-end operating results;

● developing procedures for employees to submit concerns anonymously about questionable accounting or audit matters;

● reviewing related person transactions;

● obtaining and reviewing a report by the independent registered public accounting firm at least annually that describes internal quality control procedures, any material issues with such procedures and any steps taken to deal with such issues when required by applicable law;

● approving or, as permitted, pre-approving, audit and permissible non-audit services to be performed by the independent registered public accounting firm.

Compensation Committee

The compensation committee consists of Sandeep Kulkarni, Amit Munshi and Parvinder Thiara.

The chair of the compensation committee is Sandeep Kulkarni.

The Zura board has determined that each member of the compensation committee is independent under the Nasdaq listing standards and a “non-employee director” as defined in Rule 16b-3 promulgated under the Exchange Act.

The primary purpose of the compensation committee will be to discharge the responsibilities of the board of directors in overseeing the compensation policies, plans and programs and to review and determine the compensation to be paid to executive officers, directors and other senior management, as appropriate.

Specific responsibilities of the compensation committee include:

● reviewing and approving the compensation of the chief executive officer, other executive officers and senior management;

● administering the equity incentive plans and other benefit programs;

● reviewing, adopting, amending and terminating incentive compensation and equity plans, severance agreements, profit sharing plans, bonus plans, change-of-control protections and any other compensatory arrangements for the executive officers and other senior management;

● reviewing and establishing general policies relating to compensation and benefits of the employees, including the overall compensation philosophy.

Nominating and Governance Committee

The nominating and governance committee consists of Arnout Ploos van Amstel, Neil Graham, Sandeep Kulkarni and Parvinder Thiara.

The chair of the nominating and corporate governance committee is Parvinder Thiara.

The Zura board has determined that each member of the nominating and corporate governance committee is independent under the Nasdaq listing standards.

Specific responsibilities of the nominating and corporate governance committee will include:

● identifying and evaluating candidates, including the nomination of incumbent directors for reelection and nominees recommended by shareholders, to serve on the board of directors;

● considering and making recommendations to the board of directors regarding the composition and chairmanship of the committees of the board of directors;

● developing and making recommendations to the board of directors regarding corporate governance guidelines and matters;

● overseeing periodic evaluations of the performance of the board of directors, including its individual directors and committees.

Compensation Committee Interlocks and Insider Participation

None of our officers currently serves, and in the past year has not served, (i) as a member of the compensation committee or board of directors of another entity, one of whose executive officers serves on our compensation committee, or (ii) as a member of the compensation committee of another entity, one of whose executive officers serves on our board of directors.

Guidelines for Selecting Director Nominees

The guidelines for selecting nominees, which are specified in the Nominating Committee Charter, generally provide that persons to be nominated:

● should have demonstrated notable or significant achievements in business, education or public service;

● should possess the requisite intelligence, education and experience to make a significant contribution to the board of directors and bring a range of skills, diverse perspectives and backgrounds to its deliberations;

● should have the highest ethical standards, a strong sense of professionalism and intense dedication to serving the interests of the shareholders.

The Nominating Committee will consider a number of qualifications relating to management and leadership experience, background, integrity and professionalism in evaluating a person’s candidacy for membership on the board of directors.

The nominating committee may require certain skills or attributes, such as financial or accounting experience, to meet specific board needs that arise from time to time and will also consider the overall experience and makeup of its members to obtain a broad and diverse mix of board members.

The nominating committee does not distinguish among nominees recommended by shareholders and other persons.

Fiduciary Duties

Under Cayman Islands law, directors and officers owe the following fiduciary duties:

duty to act in good faith in what the director or officer believes to be in the best interests of the company as a whole;

duty to exercise powers for the purposes for which those powers were conferred and not for a collateral purpose;

directors should not properly fetter the exercise of future discretion;

duty to exercise powers fairly as between different sections of shareholders;

duty not to put themselves in a position in which there is a conflict between their duty to the company and their personal interests;

duty to exercise independent judgment.

In addition to the above, directors also owe a duty of care which is not fiduciary in nature.

This duty has been defined as a requirement to act as a reasonably diligent person having both the general knowledge, skill and experience that may reasonably be expected of a person carrying out the same functions as are carried out by that director in relation to the company and the general knowledge skill and experience of that director.

As set out above, directors have a duty not to put themselves in a position of conflict and this includes a duty not to engage in self-dealing, or to otherwise benefit as a result of their position.

However, in some instances what would otherwise be a breach of this duty can be forgiven and/or authorized in advance by the shareholders provided that there is full disclosure by the directors.

This can be done by way of permission granted in the amended and restated memorandum and articles of association or alternatively by shareholder approval at general meetings.

Code of Conduct and Ethics

The Zura board has adopted a Code of Ethics.

The Code of Ethics applies to all of our employees, officers, and directors, as well as all of our contractors, consultants, suppliers, and agents in connection with their work for Zura.

The full text of our Code of Ethics has been posted on our website, which can be found at www.zurabio.com.

We intend to disclose future amendments to, or waivers of, its Code of Conduct, as and to the extent required by SEC regulations, at the same location on its website identified above or in public filings.

Information contained on our website is not incorporated by reference into this annual report, and you should not consider the information contained on our website to be part of this annual report.

Section 16(A) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, requires our executive officers, directors and persons who beneficially own more than 10% of a registered class of our equity securities to file with the SEC initial reports of ownership and reports of changes in ownership of our ordinary shares and other equity securities.

These executive officers, directors, and greater than 10% beneficial owners are required by SEC regulation to furnish us with copies of all Section 16(a) forms filed by such reporting persons.

Based solely on our review of such forms furnished to us and written representations from certain reporting persons, we believe that all filing requirements applicable to our executive officers, directors and greater than 10% beneficial owners were filed in a timely manner during 2023.

The information required by this item will be included in the definitive proxy statement to our 2025 Annual General Meeting of Shareholders and is incorporated herein by reference.

Our Code of Ethics (the “Code”), which applies to all directors, officers and employees, is available on our Investor Relations website, investors.zurabio.com.

We intend to satisfy the disclosure requirements regarding any applicable amendment to or waiver from the Code by posting such information on our Investor Relations website rather than by filing a Current Report on Form 8-K.

EXECUTIVE COMPENSATION

This section discusses the material components of executive compensation for our 2023 named executive officers.

Our named executive officers for fiscal year ended December 31, 2023 are:

● Someit Sidhu, our Chief Executive Officer;

● Verender Badial, our Chief Financial Officer;

● Kim Davis, our Chief Legal Officer;

● Michael Howell, our Chief Scientific Officer;

● Chris Cabell, our former Chief Medical Officer and Executive Vice President;

● Preston Klassen, our former President and Chief Operating Officer;

The following table sets forth information concerning the total compensation of the following persons, whom we refer to as our named executive officers:

(i) our Chief Executive Officer and our Chief Financial Officer, (ii) our next two most highly compensated executive officers on December 31, 2023 and (iii) two individuals who would have been included in this table but for the fact that such individuals were not serving as an executive officer as of December 31, 2023.

Summary Compensation Table

Incentive Plan

Option Awards

Name and Principal Position

Someit Sidhu Chief Executive Officer

10,202,828.46

10,645,765.01

Verender Badial Chief Financial Officer

Kim Davis Chief Legal Officer

Michael Howell Chief Scientific Officer

Chris Cabell (3) former Chief Medical Officer and Executive Vice President

Preston Klassen (4) former President and Chief Operating Officer

(1) The amounts in this column represent the aggregate grant-date fair value of awards granted to each named executive officer under our equity incentive plans, computed in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 718.

(2) The amounts in this column represent the applicable named executive officer’s total annual performance-based cash bonus for the year ending December 31, 2023.

Cabell resigned effective January 2024.

Klassen resigned effective April 2023.

(5) All other compensation in 2023 include government mandated defined contribution plan, employer paid benefits, travel expenses, business reimbursements, and others.

Narrative to the Summary Compensation Table

We review compensation annually for all employees, including our named executive officers.

In setting our named executive officers’ base salaries and bonuses and granting equity incentive awards, we seek to align pay for performance and consider, among other factors, compensation for comparable positions in the market, the historical compensation levels of our named executive officers, individual performance as compared to our expectations and objectives, our desire to motivate our named executive officers to achieve short- and long-term results that are in the best interests of our shareholders, and a long-term commitment to our company.

Base Salaries

In 2023, each of the named executive officers received an annual base salary to compensate them for services rendered to us.

The base salary payable to each named executive officer was intended to provide a fixed component of compensation reflecting such executive’s skill set, experience, role, and responsibilities.

Annual Cash Bonuses

In 2023, each named executive officer was eligible to earn his/her bonus based on the attainment of company and individual performance metrics, as determined by the Board, in its discretion.

The actual annual cash bonuses awarded to each named executive officer for 2023 performance are set forth above in the Summary Compensation Table in the column titled “Bonus”.

Employment Agreements with Our Named Executive Officers

On April 7, 2023, the Company entered into a Service Agreement with its Chief Executive Officer, Dr.

Someit Sidhu (the “Sidhu Agreement”), effective as of March 20, 2023.

The terms of the Sidhu Agreement provide the following compensation and benefits while he is employed as Chief Executive Officer:

● Annual salary equal to £425,000.

● Eligibility to earn a discretionary bonus.

● Participation in the Company’s benefit plans and reimbursement of Dr.

Sidhu’s reasonable travel, hotel and entertainment expenses.

The Sidhu Agreement may be terminated by either party giving the other not less than three (3) months’ prior notice, subject to the Company’s right to buy out the three month notice period in its discretion by providing garden leave and its right to terminate this agreement immediately for cause (as defined under the Sidhu Agreement) without further payment of compensation except as required by law or for reimbursement of eligible incurred expenses.

Sidhu’s employment is terminated by the Company without cause, Dr.

Sidhu will be entitled to receive severance payments equal to six (6) months’ salary, subject to signing a release and complying with the obligations under his agreement.

The Sidhu Agreement also contains certain customary obligations, including confidentiality and cooperation.

Verender Badial

On April 7, 2023, the Company entered into a Service Agreement with its Chief Financial Officer, Verender Badial (the “Badial Agreement”), effective as of March 20, 2023.

The terms of the Badial Agreement are substantially the same as the Sidhu Agreement except that Mr.

Badial’s salary is £336,000.

It is anticipated that the Company will provide notice to terminate Mr.

Badial’s employment without cause (as defined in the Badial Agreement) once the Company employs a successor Chief Financial Officer, at which point Mr.

Badial would be entitled to severance payments equal to six (6) months’ salary, subject to signing a release and complying with the obligations under his agreement.

The Badial Agreement also contains certain customary obligations, including confidentiality and cooperation.

Kiran Nistala

On November 30, 2023, the Company entered into a Service Agreement with Dr.

Kiran Nistala, our Executive Vice President and Chief Medical Officer (the “Nistala Agreement”).

The terms of the Nistala Agreement provide the following compensation and benefits while he is employed:

● Annual salary equal to GBP £320,000.

● Eligibility to earn a performance bonus of up to 40% of his annual salary, based on performance.

● Participation in the Company’s benefit plans.

Under the terms of the Nistala Agreement, the Company may terminate the employment for cause under the Nistala Agreement with immediate effect without notice and with no liability to make any further payment to Dr.

Kiran Nistala.

Robert Lisicki

On January 3, 2024, the Company entered into an employment agreement with Mr.

Robert Lisicki, our President and Chief Operating Officer (the “Lisicki Agreement”).

The terms of the Lisicki Agreement provide the following compensation and benefits while he is employed:

● Annual salary equal to $440,000.

● Eligibility to earn a performance bonus of up to 40% of his annual salary, based on performance.

● Participation in the Company’s benefit plans.

Under the terms of the Lisicki Agreement, the Company may terminate the Lisicki Agreement at any time, with or without cause, for any reason or no reason whatsoever by the Company upon no less than ninety (90) calendar days’ written notice, or by Mr.

Robert Lisicki upon no less than ninety (90) calendar days’ written notice, unless a lesser time is mutually agreed upon by both parties.

Outstanding Equity Awards at Fiscal Year-End Table

The following table sets forth information regarding outstanding equity awards for each of our named executive officers as of December 31, 2023:

Option Awards

Market Payout

Unearned Shares,

Units or Other

Shares, Units or

that have not

Unexercisable

5/18/2023 (1)

Verender Badial

5/18/2023 (2)

3/15/2023 (3)

5/18/2023 (3)

Michael Howell

3/15/2023 (4)

5/18/2023 (4)

3/15/2023 (5)

5/18/2023 (5)

Preston Klassen

(1) 25% of the options vest on May 18, 2024 and 2.083% vest at the end of each month thereafter.

(2) 25% of the options vest on May 18, 2024 and 2.083% vest at the end of each month thereafter.

(3) 25% of the RSUs vest on May 18, 2024, 2025, 2026 and 2027, respectively;

25% of the options vest on March 15, 2024 and 2.083% vest at the end of each month thereafter.

(4) 25% of the RSUs vest on May 18, 2024, 2025, 2026 and 2027, respectively;

25% of the options vest on March 15, 2024 and 2.083% vest at the end of each month thereafter.

(5) 25% of the RSUs vest on May 18, 2024, 2025, 2026 and 2027, respectively;

25% of the options vest on March 15, 2024 and 2.083% vest at the end of each month thereafter.

Equity Incentive Plan Information

For equity incentive plan information, see Note 9 to the Notes to Consolidated Financial Statements.

Compensation of Directors

For the year ended December 31, 2023, the Company paid each non-employee director certain directors’ fees to serve on the board.

Options to purchase Class A Ordinary Shares may be issued in addition to the director’s annual fee.

Expenses incurred in attending Board of Director meetings and committee meetings may be reimbursed.

The following table describes all compensation for each director for the year ended December 31, 2023.

Equity Incentive Plan

Compensations

11,097,330.22

Garry Neil (2)

Sandeep Kulkarni

Parvinder Thiara

Arnout Ploos van Amstel

(1) The amounts in this column represent the aggregate grant-date fair value of awards granted to each named director and former director, computed in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 718.

Neil resigned effective November 2023.

(3) All other compensation in 2023 include travel expenses, business reimbursements, and others.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth certain information known to us regarding the beneficial ownership of our Class A ordinary shares as of March 25, 2024 by:

(i) each of our Named Executive Officers;

(ii) each of our executive officers and directors;

(iii) all of our executive officers and directors as a group;

and (iv) each person or entity, or group of affiliated persons or entities, known by us to beneficially own more than 5% of our outstanding ordinary shares.

Information with respect to beneficial ownership is based on information furnished to us by each director, executive officer or shareholder who holds more than 5% of our outstanding ordinary shares, and Schedules 13G or 13D filed with the SEC, as the case may be.

Beneficial ownership is determined according to the rules of the SEC and generally means that a person has beneficial ownership of a security if he or she possesses sole or shared voting or investment power of that security, and includes options and warrants that are currently exercisable within 60 days of March 15, 2024.

Options and warrants to purchase Class A ordinary shares that are exercisable within 60 days of March 15, 2024 are deemed to be beneficially owned by the persons holding these options and warrants for the purpose of computing percentage ownership of that person, but are not treated as outstanding for the purpose of computing any other person’s ownership percentage.

Except as indicated in the footnotes below, each of the beneficial owners named in the table below has, to our knowledge, sole voting and investment power with respect to all Class A Ordinary Shares listed as beneficially owned by him or her, except for Class A Ordinary Shares owned jointly with that person’s spouse.

We have based our calculation of beneficial ownership on 43,593,678 of our Class A Ordinary Shares outstanding as of March 26, 2024.

Unless otherwise indicated, the address for each of the shareholders in the table below is c/o Zura Bio Limited, 1489 W.

Warm Springs Rd., #110, Henderson, Nevada.

Percentage of

Name of Beneficial Owner

5% and Greater Shareholders:

Athanor Capital, L.P.

JATT Ventures, L.P.

Hana Immunotherapeutics LLC (3)

Deep Track Biotechnology Master Fund Ltd.

AI Biotechnology LLC (5)

Ewon Comfortech Co., Ltd.

Willow Gate LLC (10)

Averill Master Fund, Ltd.

Stone Peach Properties LLC (9)

Executive Officers and Directors:

Someit Sidhu (2)

Verender Badial (11)

Chris Cabell (12)

Kim Davis (13)

Gary Whale (14)

Michael Howell (15)

Amit Munshi (16)

Sandeep Kulkarni (17)

Arnout Ploos van Amstel (18)

Steve Schoch (19)

Jennifer Jarrett (20)

Neil Graham (21)

Parvinder Thiara (1)

All current executive officers and directors as a group (13 individuals)

(*) Represents beneficial ownership of less than 1%.

(1) Consists of (i) 3,357,742 Class A ordinary shares that are held of record by Athanor Master Fund, LP, a Cayman Islands limited partnership (“Athanor MF”) and (ii) 1,443,891 Class A ordinary shares that are held of record by Athanor International Master Fund, LP, a Cayman Islands limited partnership (“Athanor IMF”).

Athanor Capital Partners, LP, a Delaware limited partnership (“Master GP”), is the general partner of Athanor MF.

Athanor International Fund GP, LP, a Delaware limited partnership (“International Master GP”), is the general partner of Athanor IMF.

Athanor Capital, LP, a Delaware limited partnership (“Athanor Capital”) is the investment adviser to Athanor MF and Athanor IMF.

Athanor Capital GP, LLC, a Delaware limited liability company (“Athanor Capital GP”), is the general partner of Athanor Capital.

Parvinder Thiara is the managing member of (i) Athanor Capital GP, (ii) Athanor Capital Partners GP, LLC (“ACPGP”), the general partner of Master GP, and (iii) Athanor International Fund Ultimate GP, LLC (“AIFUGP”), the general partner of International Master GP and has voting and dispositive power over the shares held by Athanor MF and Athanor IMF.

The business address of each of Athanor MF, Athanor IMF, Master GP, International Master GP, Athanor Capital, Athanor Capital GP, ACPGP, AIFUGP and Parvinder Thiara is 888 Seventh Avenue, 21 st Floor, New York, NY 10019.

The amount reported in this table does not include 500,000 Shares that Mr.

Thiara agreed to purchase pursuant to that certain Subscription Agreement, dated May 26, 2023, by and among Mr.

Thiara and Zura, which Mr.

Thiara assigned to Willow Gate pursuant to that certain Assignment and Assumption Agreement, dated May 9, 2023, by and among Mr.

Thiara and Willow Gate LLC.

The table also excludes options held by Mr.

Thiara to purchase 48,149 Class A ordinary shares that are not exercisable within 60 days of March 15, 2024.

(2) Includes securities owned by JATT Ventures, L.P.

a Cayman Islands exempted limited partnership (the “Sponsor”), which is the record holder of 351,000 Class A ordinary shares, including 2,738,701 Class A ordinary shares underlying private placement warrants.

Someit Sidhu is the sole director of JATT Ventures, Ltd., which is the sole general partner of the Sponsor, and has voting and dispositive power over the Class A ordinary shares held by the Sponsor and separately and beneficially owns an additional 4,543,719 Class A ordinary shares, including 1,750,000 Class A ordinary shares underlying public warrants and 656,573 Class A ordinary shares underlying the private warrants.

(3) Consists of Class A ordinary shares, which are held of record by Hana Immunotherapeutics LLC (“Hana”).

Chris Kim is the controlling shareholder of Hana.

Kim has voting and dispositive power over, and may be deemed to be the beneficial owner of, the shares held by Hana.

The business address of Hana is 6 Centerpointe Dr.

#625, La Palma, CA 90623.

(4) Includes pre-funded warrants to purchase 1,682,000 shares of Class A ordinary shares.

The pre-funded warrants do not allow for an exercise that would result in the holder of such pre-funded warrants (together with its affiliates, any “group” or any other persons whose beneficial ownership could be aggregated with the holder) would beneficially own more than 9.99% of the Class A ordinary shares outstanding immediately following exercise.

Deep Track Biotechnology Master Fund, Ltd.

has a principal address of 200 Greenwich Ave., Suite 3, Greenwich CT 06830-2506.

(5) Includes pre-funded warrants to purchase 2,100,000 shares of Class A ordinary shares.

AI Biotechnology LLC has a principal address c/o Access Industries Management LLC, 40W 57 th St.

FL 28, New York, NY 10019-4012.

(6) Consists of Class A ordinary shares, including 1,653,466 of the Company’s Class A ordinary shares underlying private placement warrants, which are held of record by Ewon Comfortech Co., Ltd.

The business address of Ewon is 8 Cheomdan 1-ro Jeongeup, Jeonbuk, 56212 Republic of South Korea.

(7) Consists of Class A ordinary shares, which are held of record by Pfizer Inc.

The business address of Pfizer is 235 East 42nd Street, New York, NY 10017.

(8) Averill Master Fund, Ltd.

has a principal address c/o Suvretta Capital Management LLC, 540 Madison Ave.

FL 7, New York, NY 10022-3213.

(9) Consists of Class A ordinary shares, which are held of record by Stone Peach Properties LLC (“Stone Peach”).

Baljit Lehal has voting and dispositive power over the shares held by Stone Peach.

The business address of Stone Peach is 2057 Stanton Rd, East Point, GA 30344.

(10) Consists of Class A ordinary shares, which are held of record by Willow Gate LLC (“Willow Gate”).

Shashibhushan Borade has voting and dispositive power over the shares held by Willow Gate.

The business address of Willow Gate is 35 Bethune St, New York, NY 10014.

Includes 500,000 shares acquired on June 5, 2023, pursuant to that certain Subscription Agreement, dated May 26, 2023, by and among Mr.

Thiara and Zura, which Mr.

Thiara assigned to Willow Gate pursuant to that certain Assignment and Assumption Agreement, dated May 9, 2023, by and among Mr.

Thiara and Willow Gate LLC.

(11) Excludes options held by Mr.

Badial to purchase 575,000 Class A ordinary shares that are not exercisable within 60 days of March 15, 2024.

(12) Pursuant to certain Severance And General Release Agreement dated January 18, 2024 with Mr.

Cabell, 67,525 of his stock options and 40,515 of his RSUs became vested and exercisable as of January 18, 2024.

The rest of his unvested options and RSUs were canceled and forfeited.

(13) Excludes (i) options held by Ms.

Davis to purchase 146,306 Class A ordinary shares that are not exercisable within 60 days of March 15, 2024, and (ii) 492,381 restricted share units held by Ms.

Davis that do not vest within 60 days of March 15, 2024.

(14) Excludes options held by Dr.

Whale to purchase 168,151 Class A ordinary shares that are not exercisable within 60 days of March 15, 2024.

(15) Excludes (i) options held by Dr.

Howell to purchase 135,051 Class A ordinary shares that are not exercisable within 60 days of March 15, 2024, and (ii) 114,395 restricted share units held by Dr.

Howell that do not vest within 60 days of March 15, 2024.

(16) Excludes equity grants consisting of (i) 374,995 Class A ordinary shares underlying RSUs granted to Mr.

Munshi which will vest in four equal annual installments commencing on March 15, 2024, (ii) performance shares providing Mr.

Munshi the option to purchase 306,373 Class A ordinary shares at an exercise price per share equal to $8.16, the fair market value of a Class A ordinary share on March 20, 2023 (the date of grant), which will become exercisable if the 20-day volume weighted average trading price of the Class A ordinary shares is over $30 per share at any time prior to March 20, 2028 (the fifth anniversary of the closing of the merger of ZBHL with a wholly-owned subsidiary of JATT), and (iii) 1,130,000 options granted on June 1, 2023.

The Class A ordinary shares underlying the RSUs and options are excluded because they may not vest and will not be issued within 60 days of March 15, 2024.

The performance shares underlying the options are excluded because it is indeterminable whether such options will become exercisable within 60 days of March 15, 2024.

(17) Excludes options held by Dr.

Kulkarni to purchase 413,034 Class A ordinary shares.

140,353 options are exercisable and vest within 60 days of March 15, 2024.

(18) Excludes options held by Dr.

Ploos van Amstel to purchase 48,149 Class A ordinary shares not exercisable or vest within 60 days of March 15, 2024.

(19) Excludes options held by Mr.

Schoch to purchase 20,406 Class A ordinary shares, 3,720 of which are exercisable and vest within 60 days of March 15, 2024.

(20) Excludes options held by Ms.

Jarrett to purchase 20,406 Class A ordinary shares, 3,720 of which are exercisable and vest within 60 days of March 15, 2024.

(21) Excludes options held by Dr.

Graham to purchase 20,406 Class A ordinary shares, 3,720 of which are exercisable and vest within 60 days of March 15, 2024.

The information required by this item will be included in the definitive proxy statement to our 2025 Annual General Meeting of Shareholders and is incorporated herein by reference.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS

The information required by this item will be included in the definitive proxy statement to our 2025 Annual General Meeting of Shareholders and is incorporated herein by reference.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Lilly ZB17 License

Effective April 26, 2023, ZB17 entered into the Lilly-ZB17 License Agreement with Lilly, pursuant to which Lilly granted to ZB17 the Lilly-ZB17 License to develop, manufacture and commercialize a certain bispecific antibody relating to IL-17 and BAFF (“ZB-106”) in the field (meaning all uses including any and all human therapeutic, diagnosis, prevention, amelioration and prophylactic uses) worldwide.

During certain specified periods, Lilly shall have the exclusive right to evaluate certain clinical trial results and determine whether it wishes to negotiate an agreement for the further development and commercialization of ZB-106 by Lilly.

If Lilly provides notice to the Company before the expiry of the applicable period that it wishes to seek to negotiate an agreement, the parties will have good faith negotiations to agree commercially reasonable terms and conditions.

The Lilly-ZB17 License is sublicensable without Lilly’s consent to an affiliate of ZB17, provided that ZB17 provides prior written notice to Lilly.

Lilly’s consent is required to sublicense to any third party other than a contact research organization or contract development and manufacturing organization.

In all cases the sublicense must have terms consistent with the Lilly License.

Neither ZB17 nor Lilly may assign its rights and obligations without the other party’s prior written consent, unless such transfer is to an affiliate or in the event of a change of control, in which case notice must be provided.

Lilly retains certain rights under the License Agreement, including its unrestricted ability to use certain intellectual property rights related to ZB-106 for Lilly’s and its affiliates’ research purposes.

If ZB17 fails to comply with any of its obligations under the License Agreement, Lilly may have the right to terminate the License, in which event the Company would not be able to market any product related to ZB-106.

As consideration, ZB17 will pay Lilly an irrevocable, non-refundable upfront fee of $18,590,000 divided into three tranches:

the first tranche of $5,750,000 was paid in connection with the signing of the Lilly-ZB17 License;

the second tranche consisted of 1,000,000 Class A Ordinary Shares issued pursuant to the Equity Grant Agreement (as defined and further described below);

and the third tranche will be due and payable within ten business days of ZB17’s receipt of certain know-how, data, information and materials that Lilly is required to provide under the License Agreement.

In addition, ZB17 agreed to the following additional payment terms:

● pay Lilly four development milestone payments up to an aggregate of $155 million;

● pay Lilly sales milestone payments up to an aggregate of $440 million based on respective thresholds of net sales of products developed from ZB-106;

● pay Lilly over a multi-year period (twelve years, or upon the later expiration of regulatory exclusivity of ZB-106 in a country) an annual earned royalty at a marginal royalty rate in the mid-single digits to low-double digits, with increasing rates depending on net sales (as defined in the Lilly-ZB17 License Agreement) in the respective calendar year, based on a percentage of sales within varying thresholds for a certain period of years.

Pursuant to the Lilly-ZB17 License Agreement, ZB17 is required to prepare a development plan to develop and seek regulatory approval for ZB-106 in several countries and then to commercialize each product where regulatory approval is obtained.

If ZB17 fails to comply with the obligations under the Lilly-ZB17 License Agreement, or if ZB17 uses the licensed intellectual property in an unauthorized manner, ZB17 may be required to pay damages and Lilly may have the right to terminate the license.

Upon expiry of the Lilly-ZB17 License Agreement, the Lilly-ZB17 License shall become fully paid-up, non-exclusive, royalty-free, perpetual and irrevocable.

No royalty or milestone payments have been paid to date under the Lilly-ZB17 License Agreement.

ZB-106 Equity Grant Agreement

Concurrently with the execution of the Lilly-ZB17 License Agreement, as partial consideration for Lilly entering into the Lilly-ZB17 License Agreement, the Company and Lilly entered into that certain Equity Grant Agreement (the “ZB-106 Equity Grant Agreement”), dated as of April 26, 2023, pursuant to which the Company agreed to issue and grant to Lilly 1,000,000 Shares (the “Lilly Shares”) in a private placement transaction.

The ZB-106 Equity Grant Agreement also contains customary representations, warranties, and covenants of each of the Company and Lilly.

The closing under the Equity Grant Agreement occurred on May 3, 2023.

Other than the benefit of the Lilly-ZB17 License Agreement with ZB17, the Company did not receive any consideration from Lilly for the issuance of the Lilly Shares.

In connection with the Equity Grant Agreement, the Company agreed to register the Lilly Shares under a Registration Rights Agreement (the “Registration Rights Agreement”).

The Registration Rights Agreement will govern the registration of the Lilly Shares for resale and includes certain customary registration rights requiring the company to file a registration statement with respect to the Lilly Shares.

April 2023 Private Placement Financing

Zura agreed to sell an aggregate of approximately 18.8 million Shares, and pre-funded warrants in lieu of Shares, to certain accredited institutional investors in the April 2023 Private Placement (as defined above).

The April 2023 Private Placement resulted in gross proceeds to Zura of approximately $80 million in cash, before deducting placement agent fees and other offering expenses payable by Zura.

In addition, Lilly received an aggregate of approximately $4.25 million in Shares in lieu of a portion of the upfront cash paid by Zura as consideration for the licensing transaction for ZB-106.

The ZB-106 Private Placement was led by Deep Track Capital, Great Point Partners, Suvretta Capital, and a leading life sciences-focused investment fund, alongside several additional new and existing investors.

Pursuant to the terms of the subscription agreements entered into with the investors in the April 2023 Private Placement (the “Second PIPE Subscription Agreements”), each Class A ordinary share was sold at a price of $4.25 per share and each pre-funded warrant was sold at a price of $4.249 per pre-funded warrant.

Each pre-funded warrant will have an exercise price of $0.001 per Class A ordinary share.

At the initial closing, investors have committed to purchase an aggregate of approximately 3.8 million Class A ordinary shares for a total of approximately $16 million in gross proceeds, excluding the shares issued to Lilly.

At the second closing, which occurred on June 5, 2023, investors purchased an aggregate of approximately 15 million Class A ordinary shares and pre-funded warrants for an additional total of approximately $64 million in gross proceeds.

Following the final closing of the April 2023 Private Placement, Zura has $120 million in cash and cash equivalents on hand, which it believes will be sufficient to fund its planned operating expenses and capital expenditure requirements through 2026.

PRINCIPAL ACCOUNTING FEES AND SERVICES

The following is a summary of fees paid or to be paid to WithumSmith+Brown, PC, or Withum, for services rendered.

Audit fees consist of fees billed for professional services rendered for the audit of our year-end financial statements and services that are normally provided by Withum in connection with regulatory filings.

The aggregate fees billed by Withum for professional services rendered for the audit of our annual financial statements, review of the financial information for the respective periods, registration statements for the IPO and for the proposed business combination and other required filings with the SEC was $0.7 million for the fiscal year ended December 31, 2023.

We paid $0.7 million and the balance amount to be paid was $-0- at December 31, 2023.

The above amounts include interim procedures and audit fees, as well as attendance at audit committee meetings.

Audit-Related Fees.

Audit-related services consist of fees billed for assurance and related services that are reasonably related to performance of the audit or review of our financial statements and are not reported under “Audit Fees.” These services include attest services that are not required by statute or regulation and consultations concerning financial accounting and reporting standards.

We did not pay Withum for consultations concerning financial accounting and reporting standards for the fiscal year ended December 31, 2023.

We did not pay Withum for tax planning and tax advice for the fiscal year ended December 31, 2023.

All Other Fees .

We did not pay Withum any other fees for the fiscal year ended December 31, 2023.

Pre-Approval Policy

Our audit committee was formed upon the consummation of our IPO.

As a result, the audit committee did not pre-approve all of the foregoing services, although any services rendered prior to the formation of our audit committee were approved by our board of directors.

Since the formation of our audit committee, and on a going-forward basis, the audit committee has and will pre-approve all auditing services and permitted non-audit services to be performed for us by our auditors, including the fees and terms thereof (subject to the de minimis exceptions for non-audit services described in the Exchange Act which are approved by the audit committee prior to the completion of the audit).

The information required by this item will be included in the definitive proxy statement to our 2025 Annual General Meeting of Shareholders and is incorporated herein by reference.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this item will be included in the definitive proxy statement to our 2025 Annual General Meeting of Shareholders and is incorporated herein by reference.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES

1 unchanged sentence

(1) Financial Statements:

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets

Consolidated Statements of Operations

Consolidated Statements of Changes in Redeemable Noncontrolling Interest, Convertible Preferred Shares, and Shareholders’ Equity (Deficit)

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

The financial statements as set forth under Item 8 of this Annual Report are incorporated herein.

(2) Financial Statement Schedules:

We hereby file as part of this Report the exhibits listed in the attached Exhibit Index.

Exhibits which are incorporated herein by reference can be inspected and copied at the public reference facilities maintained by the SEC, 100 F Street, N.E., Room 1580, Washington, D.C.

Copies of such material can also be obtained from the Public Reference Section of the SEC, 100 F Street, N.E., Washington, D.C.

20549, at prescribed rates or on the SEC website at www.sec.gov.

All schedules have been omitted because they are not required, not applicable, not present in amounts sufficient to require submission of the schedule, or the required information is otherwise included in our consolidated financial statements and related notes.

The following exhibits are filed as part of, or incorporated by reference into, this Annual Report.

Business Combination Agreement, dated as of June 16, 2022, by and among JATT, Merger Sub, Merger Sub 2, Holdco and Zura Bio Limited (incorporated by reference to Exhibit 2.1 of JATT’s Current Report on Form 8-K (File No.

001-40598), filed with the SEC on June 17, 2022).

First Amendment dated as of September 20, 2022 to the Business Combination Agreement by and among JATT, Merger Sub, Merger Sub 2 and Holdco and Zura Bio Limited (incorporated by reference to Exhibit 2.2 of JATT’s Form S-4/A (File No.

333-267005), filed with the SEC on October 25, 2022).

Second Amendment dated as of November 14, 2022 to the Business Combination Agreement by and among JATT, Merger Sub, Merger Sub 2, Holdco and Zura Bio Limited (incorporated by reference to Exhibit 2.2 of JATT’s Current Report on Form 8-K (File No.

001-40598), filed with the SEC on November 15, 2022).

Third Amendment dated as of January 13, 2023 to the Business Combination Agreement by and among JATT Acquisition Corp, JATT Merger Sub, JATT Merger Sub 2, Zura Holdings, Ltd.

1 unchanged sentence

001-40598), filed with the SEC on January 19, 2023).

Second Amended and Restated Memorandum and Articles of Association of Zura Bio Limited (incorporated by reference to Exhibit 3.1 to Zura’s Form 8-K (File No.

001-40598), filed with the SEC on March 24, 2023).

Specimen Share Certificate of Zura (incorporated by reference to Exhibit 4.5 of JATT’s Form S-4 (File No.

333-267005) filed with the SEC on August 19, 2022).

Specimen Warrant Certificate of Zura (incorporated by reference to Exhibit 4.6 of JATT’s Form S-4 (File No.

333-267005) filed with the SEC on August 19, 2022).

Form of Pre-Funded Warrant to Purchase Ordinary Shares (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the SEC on May 3, 2023).

Form of Pre-Funded Warrant to Purchase Ordinary Shares (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the SEC on August 21, 2024).

Form of Pre-Funded Warrant to purchase Ordinary Shares (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed with the Securities and Exchange Commission on April 23, 2024).

Description of Registrant’s securities.

19 unchanged sentences

Employment Agreement between Zura Bio Limited and Robert Lisicki (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the Issuer with the SEC on January 8, 2023).

Settlement Agreement by and between Zura Bio Limited and Someit Sidhu dated July 24, 2024 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the Issuer with the SEC on July 25, 2024).

Amendment to Warrant Agreement, by and between Zura Bio Limited and Continental Stock Transfer & Trust Company, dated August 12, 2024 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the Issuer with the SEC on August 12, 2024).

Share Surrender and Warrant Agreement, dated as of August 15, 2024, by and among the Company and certain investors party thereto (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the Issuer with the SEC on August 21, 2024).

Form of Subscription Agreement (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the Issuer with the SEC on April 23, 2024).

Sales Agreement, by and between Zura Bio Limited and Leerink Partners LLC, dated September 3, 2024 (incorporated by reference to Exhibit 1.2 to the Registration Statement on Form S-3 filed by the Issuer with the SEC on September 3, 2024).

Amended and Restated Registration Rights Agreement dated March 20, 2023, by and among the Company, the Sponsor and the parties thereto (incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K (File No.

001-40598) filed with the SEC on March 24, 2023).

Form of Indemnity Agreement (incorporated by reference to Exhibit 10.13 of Zura’s Current Report on Form 8-K (File No.

001-40598) filed with the SEC on March 24, 2023).

Zura Bio Limited 2023 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.12 of the Company’s Current Report on Form 8-K (File No.

001 40598), filed with the SEC on March 24, 2023).

Share Option Award Agreement (incorporated by reference to Annex C of the Definitive Proxy Statement on Schedule 14A filed by the Issuer with the SEC on May 19, 2023).

Letter Agreement, dated as of December 8, 2022, by and among Zura Bio Limited and Stone Peach Properties LLC (incorporated by reference to Exhibit 10.27 of JATT’s Form S-4/A (File No.

333-267005) filed with the SEC on December 14, 2022).

Offer Letter Agreement with Kim Davis, dated November 22, 2022 (incorporated by reference to Exhibit 10.39 to the Form S-1/A filed by the Issuer with the SEC on August 11, 2023).

Letter dated February 23, 2024 from Marcum LLP to the Securities and Exchange Commission regarding change in Certifying Accountant of the Company (incorporated by reference to Exhibit 16.1 to the Current Report on Form 8-K filed by the Issuer with the SEC on February 23, 2024).

Insider Trading Policy.

List of Subsidiaries of Zura Bio Limited (incorporated by reference to Exhibit 21.2 of JATT’s Form S-4/A (File No.

333-267005) filed with the SEC on October 25, 2022).

Consent of WithumSmith+Brown, PC, independent registered public accounting firm of Zura.

Power of Attorney (included on signature page).

Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

4 unchanged sentences

Section 1350, As adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Clawback Policy

Clawback Policy (incorporated by reference to Exhibit 97.1 to the Company’s Annual Report on Form 10-K filed on March 28, 2024).

XBRL Instance Document.

12 unchanged sentences

+ Portions of this Exhibit have been omitted pursuant to Item 601(b)(2) of Regulation S-K.

* Filed herewith.

** Furnished herewith and not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act (whether made before or after the date of the Form 10-K), irrespective of any general incorporation language contained in such filing.

FORM 10-K SUMMARY

2 unchanged sentences

March 25, 2025

/s/ Someit Sidhu, MD

Someit Sidhu, MD

/s/ Robert Lisicki

Robert Lisicki

Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Verender S.

Badial and Kim Davis, and each of them, as his or her true and lawful attorneys-in-fact and agents, each with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments, including post-effective amendments, to this registration statement, and any registration statement relating to the offering covered by this registration statement and filed pursuant to Rule 462(b) under the Securities Act of 1933, and to file the same, with 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 requisite and necessary to be done, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that each of said attorneys-in-fact and agents, or his or her substitute or substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated.

/s/ Someit Sidhu

/s/ Robert Lisicki

Chief Executive Officer and Director

March 25, 2025

Robert Lisicki

(Principal Executive Officer)

3 unchanged sentences

Verender Badial

(Principal Financial Officer)

(Principal Financial and Accounting Officer)

/s/ Amit Munshi

1 unchanged sentence

March 25, 2025

/s/ Sandeep Kulkarni

/s/ Someit Sidhu

March 25, 2025

Sandeep Kulkarni

/s/ Arnout Ploos van Amstel

11 unchanged sentences

Parvinder Thiara

/s/ Sandeep Kulkarni

March 25, 2025

Sandeep Kulkarni

ZURA BIO LIMITED

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm

8 unchanged sentences

Opinion on the Consolidated financial statements

We have audited the accompanying consolidated balance sheets of Zura Bio Limited (the “Company”) as of December 31, 2023 and 2022, and the related consolidated statements of operations, changes in redeemable noncontrolling interest, convertible preferred shares, and shareholders’ equity (deficit), and cash flows for the year ended December 31, 2023 and the period from January 18, 2022 (date of inception) through December 31, 2022, and the related consolidated notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for the year ended December 31, 2023 and the period from January 18, 2022 (date of inception) through December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

We have audited the accompanying consolidated balance sheets of Zura Bio Limited (the “Company”) as of December 31, 2024 and 2023, and the related consolidated financial statements of operations, changes in redeemable noncontrolling interest, convertible preferred shares, and shareholders’ equity (deficit), and cash flows for each of the two years in the period ended December 31, 2024, and the related consolidated notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

12 unchanged sentences

We believe that our audits provide a reasonable basis for our opinion.

/s/ WithumSmith+Brown, PC

We have served as the Company’s auditor since 2022.

/s/ WithumSmith+Brown, PC

East Brunswick, New Jersey

10 unchanged sentences

Total current assets

Deferred offering costs

Liabilities, Redeemable Noncontrolling Interest, Convertible Preferred Shares, and Shareholders’ Equity (Deficit)

Property and equipment, net

Liabilities, Redeemable Noncontrolling Interest and Shareholders' Equity

Current liabilities

Accounts payable and accrued expenses

Research and development license consideration liability

Total current liabilities

3 unchanged sentences

Redeemable noncontrolling interest

Convertible preferred shares

Series A-1 convertible preferred shares, $ 0.001 par value, - 0 - and 13,510,415 shares authorized , issued and outstanding as of December 31, 2023 and 2022, respectively

Shareholders’ Equity (Deficit):

Preferred Shares, $ 0.0001 par value, 1,000,000 and - 0 - authorized as of December 31, 2023 and 2022, respectively;

- 0 - issued and outstanding as of December 31, 2023 and 2022

Class A Ordinary Shares, $ 0.0001 par value, 300,000,000 authorized, 43,593,678 issued and outstanding as of December 31, 2023;

1,884,649 authorized, 279,720 issued and outstanding as of December 31, 2022

Shareholders’ Equity

Preferred shares, $ 0.0001 par value, 1,000,000 authorized as of December 31, 2024 and 2023;

no shares issued and outstanding as of December 31, 2024 and 2023

Class A Ordinary Shares, $ 0.0001 par value;

300,000,000 shares authorized as of December 31, 2024 and 2023;

65,297,530 and 43,593,678 shares issued and outstanding as of December 31, 2024 and 2023, respectively

Additional paid-in capital

Accumulated deficit

Total Zura Bio Limited shareholders’ equity (deficit)

Total Zura Bio Limited shareholders' equity

Noncontrolling interest

Total shareholders’ equity (deficit)

Total liabilities, redeemable noncontrolling interest, convertible preferred shares, and shareholders’ equity (deficit)

Total shareholders’ equity

Total liabilities, redeemable noncontrolling interest and shareholders' equity

See accompanying notes to consolidated financial statements.

2 unchanged sentences

(In thousands, except share and per share data)

For the Period from

January 18, 2022

For the Year Ended

(date of inception) to

For the Years Ended December 31,

Operating expenses:

3 unchanged sentences

Loss from operations

Other expense/(income), net:

Other expense, net

Other (income)/expense, net

Interest income

Dividend income

Change in fair value of private placement warrants

Change in fair value of note payable

Total other expense/(income), net

Dividend income

Other income, net

Total other income, net

Loss before income taxes

2 unchanged sentences

Net loss attributable to redeemable noncontrolling interest

Adjustment of redeemable noncontrolling interest from redemption value to carrying value

Accretion of redeemable noncontrolling interest to redemption value

15 unchanged sentences

Balance as of December 31, 2022

Recapitalization, net of forfeited shares

Balance as of December 31, 2022

Issuance of Series A-1 convertible preferred shares as license compensation

14 unchanged sentences

Balance as of December 31, 2023

Balance as of January 18, 2022 (date of inception)

Issuance of Class A Ordinary Shares at inception

Issuance of Series A-1 convertible preferred shares for cash

Issuance of Series A-1 convertible preferred shares for license

Issuance of subsidiary redeemable preferred shares for license

Exercise of stock options, net of forfeited shares

Issuance of Class A Ordinary Shares in connection with April 2024 Private Placement, net of $ 7.2 million of transaction costs

Issuance of Pre-Funded Warrants in connection with April 2024 Private Placement

Issuance of Pre-Funded Warrants in exchange for Class A Ordinary Shares

( 4,000,000 )

Issuance of Class A Ordinary Shares in exchange for Private Placement Warrants

Issuance of Class A Ordinary Shares in exchange for Public Warrants

Issuance of Class A Ordinary Shares in connection with a sale under the ATM, net of $ 0.2 million of commissions

ATM transaction costs

Issuance of Class A Ordinary Shares for restricted stock units, net of shares withheld for taxes

Share-based compensation

Accretion of redeemable noncontrolling interest to redemption value

Adjustment of redeemable noncontrolling interest from redemption value to carrying value

Balance as of December 31, 2024

4 unchanged sentences

(In thousands)

For the Period from

January 18, 2022

For the Year Ended

(date of inception) to

For the Years Ended December 31,

Cash flows from operating activities

Net loss before redeemable noncontrolling interest

Adjustments to reconcile net loss to net cash used in operating activities:

Adjustments to reconcile net loss before redeemable noncontrolling interest to net cash used in operating activities

Research and development acquired license

1 unchanged sentence

Share-based compensation expense

Change in fair value note payable

Change in fair value of note payable

Change in fair value of research and development license consideration liability

Change in fair value of private placement warrants

Depreciation and amortization

Foreign exchange transaction gain

4 unchanged sentences

Cash flows from investing activities

Purchase of fixed assets

Purchase of research and development license

1 unchanged sentence

Cash flows from financing activities

Proceeds from issuance of Series A-1 convertible preferred shares

Proceeds from issuance of Ordinary Shares in connection with April 2024 Private Placement, net of $ 7.2 million of transaction costs

Proceeds from issuance of Pre-Funded Warrants in connection with April 2024 Private Placement

Proceeds from issuance of Class A Ordinary Shares in connection with a sale under the ATM, net of $ 0.2 million of commissions

ATM transaction costs

Restricted stock units withheld to pay employee withholding taxes

Proceeds from issuance of Class A Ordinary Shares in connection with April 2023, Private Placement, net of $ 4.2 million of transaction costs

Proceeds from issuance of Class A Ordinary Shares upon Closing of Business Combination

Proceeds from issuance of Pre-Funded Warrants in connection with April 2023 Private Placement

Proceeds from note payable

Settlement of note payable

3 unchanged sentences

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

Cash and cash equivalents, ending of period

Supplemental Disclosure

2 unchanged sentences

Supplemental Disclosure of Non-Cash Investing and Financing Activities

Issuance of Class A Ordinary Shares in exchange for private placement warrants

Adjustments to redeemable noncontrolling interest from redemption value to carrying value

Purchase of property and equipment included in accounts payable and accrued expenses

Issuance of Series A-1 convertible preferred shares for license

Conversion of Series A-1 convertible preferred shares for Class A Ordinary Shares

Conversion of Series A-1 convertible preferred stock for Class A Ordinary Shares

Deemed dividend to redeemable noncontrolling interest

Accrued 2023 Lilly License consideration

Accretion of redeemable noncontrolling interest to redemption value

Deemed contribution from redeemable noncontrolling interest

Deemed dividend to redeemable noncontrolling interest

Issuance of Class A Ordinary shares for 2023 Lilly License

Accretion of redeemable noncontrolling interest to redemption value

Share-based equity issuance costs

Settlement of research and development license consideration liability

Transaction costs include in accounts payable and accrued expenses

Reclassification of deferred offering costs to additional paid-in capital

2 unchanged sentences

Issuance of Call Right to noncontrolling interest

Issuance of subsidiary redeemable preferred shares for license

Research and development consideration liability for license

See accompanying notes to consolidated financial statements.

3 unchanged sentences

Organization and Description of Business

Zura Bio Limited, a Cayman Islands exempted company, formerly known as JATT Acquisition Corp (“JATT”), together with its subsidiaries (collectively, the “Company” or “Zura” or “Zura Bio”), is a clinical-stage biotechnology company advancing immunology assets into Phase 2 development programs, including ZB-168, a fully anti-IL7Ra monoclonal antibody, which it has licensed from Pfizer, Inc.

(“Pfizer”), as well as torudokimab, a high affinity monoclonal antibody, and ZB-106, a bispecific antibody relating to IL-17 and BAFF, which it has licensed from Eli Lilly and Company (“Lilly”).

The Company’s accounting predecessor, Zura Bio Limited (herein referred to as “Legacy Zura”), was formed in the United Kingdom (“UK”) on January 18, 2022 (“Inception”).

Zura Bio Limited, a Cayman Islands exempted company, formerly known as JATT Acquisition Corp (“JATT”), together with its subsidiaries (collectively, the “Company”, “Zura” or “Zura Bio”), is a clinical-stage, multi-asset immunology company dedicated to developing novel dual-pathway antibodies for a range of autoimmune and inflammatory diseases with unmet needs.

The Company’s strategic focus is to harness dual-pathway biology to provide broader and deeper clinical benefits to patients with these conditions.

The Company is currently developing one clinical-stage product candidate in ongoing Phase 2 trials while actively evaluating development opportunities for its pipeline of clinical-stage assets, focusing on indications with unmet needs and commercial potential.

The Company is currently developing tibulizumab (ZB - 106), an immunoglobulin G (IgG)-single-chain variable fragment (scFv) bispecific dual-antagonist antibody engineered by the fusion of TALTZ® (ixekizumab) and tabalumab to neutralize interleukin-17A (IL - 17A) and B-cell activating factor (BAFF).

In December 2024, the Company initiated TibuSURE, a global Phase 2 study evaluating tibulizumab in adults with systemic sclerosis (SSc).

TibuSURE is a randomized, double-blind, placebo-controlled study designed to assess the safety, tolerability, and efficacy of tibulizumab in approximately 80 participants with early diffuse cutaneous systemic sclerosis (dcSSc).

Additionally, the Company is actively assessing the competitive landscape and evaluating potential therapeutic indications for crebankitug and torudokimab.

● Crebankitug (ZB-168) is a fully human, high affinity monoclonal antibody that binds and neutralizes the interleukin-7 receptor (IL - 7R) alpha chain.

IL - 7Rα sits at the nexus of two key immune pathways, IL - 7 and thymic stromal lymphopoietin (TSLP), thus IL - 7Rα has the potential to block activation through either of these pathways.

As a result, the Company believes crebankitug could be therapeutically relevant in a broad set of indications where the IL - 7 or TSLP pathways may be involved.

● Torudokimab (ZB - 880) is a fully human, high affinity monoclonal antibody that neutralizes interleukin-33 (IL - 33), preventing ST2 - dependent and ST2 - independent (e.g., RAGE) inflammation.

The IL - 33/ST2 axis stands as a validated therapeutic target for conditions such as chronic obstructive pulmonary disease (“COPD”) and asthma.

Business Combination

2 unchanged sentences

Pursuant to the Business Combination Agreement, (a) before the closing of the Business Combination, Holdco was established as a new holding company of Legacy Zura and became a party to the Business Combination Agreement;

and (b) on the Closing, in sequential order:

and (b) on the Closing Date, in sequential order:

(i) Merger Sub merged with and into Holdco, with Holdco continuing as the surviving company and a wholly owned subsidiary of JATT;

6 unchanged sentences

On March 20, 2023, the Company’s Class A ordinary shares (“Class A Ordinary Shares”) and public warrants began trading on the Nasdaq under the symbols “ZURA” and “ZURAW,” respectively.

See Note 3, Recapitalization, for additional details.

On August 27, 2024, the Public Warrants (as defined herein) were no longer listed on the Nasdaq in connection with the completion of the Warrant Exchange (as defined herein).

Emerging Growth Company Status

4 unchanged sentences

The Company expects to no longer be an emerging growth company effective December 31, 2026.

Change in Fiscal Year End

On November 18, 2022, the Board of Directors approved a change in the Company’s fiscal year end from March 31 to December 31.

The Company’s 2022 fiscal year began at the Company’s inception on January 18, 2022, and ended on December 31, 2022.

The change in fiscal year end also applies retrospectively to all previously issued financial statements for the periods ended March 31, 2022, June 30, 2022, and September 30, 2022.

The Company has incurred operating losses since inception and expects to continue to incur significant operating losses for the foreseeable future and may never become profitable.

The Company has an accumulated deficit of $ 103.5 and $ 32.1 million as of December 31, 2023 and 2022, respectively, and a net loss of $ 60.4 million and $ 25.7 million for the year ended December 31, 2023 and the period ended December 31, 2022, respectively.

The Company has an accumulated deficit of $ 155.9 and $ 103.5 million as of December 31, 2024 and 2023, respectively, and a net loss of $ 52.4 million and $ 60.4 million for the years ended December 31, 2024 and 2023, respectively.

The Company’s existing sources of liquidity as of December 31, 2024 includes $ 176.5 million in cash and cash equivalents.

1 unchanged sentence

Upon the closing of the Business Combination, the Company received $ 56.7 million in net cash proceeds.

Additionally, the Company received $ 75.8 million in net cash proceeds in connection with the April 2023 Private Placement.

Additionally, the Company received $ 4.9 million, $ 105.3 million and $ 75.8 million, respectively, in net cash proceeds in connection with the ATM (as defined herein), April 2024 Private Placement (as defined herein) and April 2023 Private Placement (as defined herein).

The Company’s cash requirements include, but are not limited to, clinical development, product manufacturing costs and working capital requirements.

12 unchanged sentences

Actual results could differ from those estimates.

Significant estimates and assumptions reflected in the consolidated financial statements relate to and include, but are not limited to, the fair value of Class A Ordinary Shares and other assumptions used to measure share-based compensation, the fair value of redeemable noncontrolling interest, the fair value of share-based consideration transferred for acquired assets, the fair value of contingent consideration, the fair value of the private placement warrants, and the fair value of the note payable.

Significant estimates and assumptions reflected in the consolidated financial statements relate to and include, but are not limited to, the fair value of share-based compensation, the fair value of redeemable noncontrolling interest, the fair value of share-based consideration transferred for acquired assets, the fair value of contingent consideration, the valuation allowance of deferred tax assets resulting from net operating losses and the fair value of the private placement warrants.

Risks and Uncertainties

The Company is subject to risks common to early-stage companies in the biotechnology industry, including, but not limited to, development by the Company or its competitors of technological innovations, risks of failure of clinical studies, dependence on key personnel, protection of proprietary technology, compliance with government regulations, and ability to transition from preclinical manufacturing to commercial production of products.

The Company’s future product candidates will require approvals from the U.S.

Food and Drug Administration (“FDA”) and comparable foreign regulatory agencies prior to commercial sales in their respective jurisdictions.

The Company’s future product candidates will require approvals from the United States Food and Drug Administration (“FDA”) and comparable foreign regulatory agencies prior to commercial sales in their respective jurisdictions.

There can be no assurance that any product candidates will receive the necessary approvals.

If the Company was denied approval, approval was delayed or the Company was unable to maintain approval for any product candidate, it could have a material adverse impact on the Company.

On March 10, 2023, Silicon Valley Bank became insolvent.

State regulators closed the bank and the Federal Deposit Insurance Corporation (“FDIC”) was appointed as its receiver.

The Company held deposits with this bank.

As a result of the actions by the FDIC, the Company’s insured and uninsured deposits have been restored.

The Company has significant cash balances at financial institutions which throughout the year regularly exceed the federally insured limit of $250,000.

Any loss incurred or a lack of access to such funds could have a significant adverse impact on the Company’s financial condition, results of operations, and cash flows.

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance.

The Company views its operations and manages its business as a single operating segment.

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker (“CODM”) in making decisions regarding resource allocation and assessing performance.

The Company’s CODM is the Chief Executive Officer.

The Company and the CODM views its operations and manages its business in one operating segment, developing novel medicines for immune and inflammatory disorders.

The Company has business activities in different regions that are managed on a consolidated basis.

The accounting policies of the Company’s segment are the same as those described within this footnote.

The CODM uses net loss, that is reported in the consolidated statements of operations to assess performance for the Company’s segment and decide how to allocate resources.

The significant expenses within net loss are separately presented in the Company’s consolidated statement of operations.

The CODM monitors budget versus actual results using operating loss which is a component of net loss.

The measure of segment assets is reported on the consolidated balance sheet as total consolidated assets.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents.

Deferred Offering Costs

The Company capitalizes offering costs consisting of direct, incremental legal, accounting and other fees.

The deferred offering costs are offset against the proceeds from the transaction.

Should the transaction be abandoned or not be considered probable, the deferred offering costs will be expensed immediately as a charge to operating expenses in the consolidated statements of operations.

The Company had $- 0 - and $ 3.5 million of deferred offering costs on the consolidated balance sheets as of December 31, 2023 and 2022, respectively.

The Company had $ 170.7 million and $ 97.9 million in cash equivalents as of December 31, 2024 and 2023, respectively.

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation.

Depreciation expense is recognized using the straight-line method over the estimated useful life of each asset.

Computer and office equipment are depreciated over three years .

Expenditures for repairs and maintenance are recorded to expense as incurred.

Research and Development

Research and development (“R&D”) expenses consist of all direct and indirect operating expenses supporting the processes and manufacturing in development, including consulting fees for clinical and manufacturing advisory services, costs related to manufacturing material for preclinical studies, payroll and benefits, which includes stock-based compensation, for research and development employees, licensing fees, and data and study acquisition costs.

Research and development (“R&D”) expenses consist of all direct and indirect operating expenses supporting the processes and manufacturing in development, including consulting fees for clinical and manufacturing advisory services, contract research organization (“CRO”) costs, costs related to manufacturing material for preclinical studies, payroll and benefits, which includes share-based compensation for research and development employees, licensing fees, and data and study acquisition costs.

Expenses are recognized as an expense as the related goods are delivered or the services are performed.

R&D expenses include the cost of in-process research and development (“IPR&D”) assets purchased in an asset acquisition transaction.

IPR&D assets are expensed unless the assets acquired are deemed to have an alternative future use, provided that the acquired asset did not also include processes or activities that would constitute a “business” as defined under U.S.

IPR&D assets are expensed provided that the acquired asset did not also include processes or activities that would constitute a “business” as defined under U.S.

GAAP, the drug has not achieved regulatory approval for marketing and, absent obtaining such approval, has no established alternative future use.

Acquired IPR&D payments are immediately expensed in the period in which they are incurred and include upfront payments, as well as transaction fees and subsequent pre-commercial milestone payments.

Acquired IPR&D payments, including upfront payments, transaction fees and subsequent pre-commercial milestone payments, are immediately expensed in the period in which they are incurred.

Research and development costs incurred after the acquisition are expensed as incurred.

1 unchanged sentence

Share-Based Compensation

The Company accounts for all share-based payments to employees and non-employees, including grants of share options, share options with non-market performance conditions (“PSOs”), share options with market-based performance conditions, restricted share units, and restricted share awards based on their respective grant date fair values.

Share options that vest immediately and have a nominal exercise price are valued based on the fair value of the Company’s Class A Ordinary Shares on the date of grant.

The Company accounts for all share-based payments to employees and non-employees, including grants of share options, share options with non-market performance conditions (“PSOs”), share options with market-based performance conditions, restricted share units (“RSUs”), and restricted share awards (“RSAs”) based on their respective grant date fair values.

RSUs, RSAs and share options that vest immediately and have a nominal exercise price are valued based on the fair value of the Company’s Class A Ordinary Shares on the date of grant.

The Company estimates the fair value of share option grants using the Black-Scholes option-pricing model.

1 unchanged sentence

The Company expenses share-based compensation related to share options with only service conditions over the requisite service period on a straight-line basis.

The Company will record share-based compensation expense for the PSOs when the Company’s management deems it probable that the performance conditions will be satisfied.

The Company records share-based compensation expense for the PSOs when the Company’s management deems it probable that the performance conditions will be satisfied.

The Company estimates the fair value of share option grants with market-based performance conditions using a Monte-Carlo simulation model.

For share option grants with market-based performance conditions, the Company recognizes share-based compensation expense as the requisite service is rendered by the employee, regardless of when, if ever, the market-based performance conditions are satisfied.

The share-based compensation costs are recorded in research and development and general and administrative expenses in the consolidated statements of operations.

The share-based compensation costs are recorded in research and development and general and administrative expenses in the consolidated statements of operations based upon the respective employee’s or non-employee’s role within the Company.

Forfeitures are recorded as they occur.

Income taxes are recorded in accordance with ASC Accounting Standards Codification (“ASC”) 740, Income Taxes which provides for deferred taxes using an asset and liability approach.

The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns.

Deferred tax assets and liabilities are determined based on the difference between the consolidated financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse, and net operating loss (“NOL”) carryforwards.

Valuation allowances are provided, if based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

The Company has recorded a full valuation allowance to reduce its net deferred income tax assets to zero.

In the event the Company were to determine that it would be able to realize some or all its deferred income tax assets in the future, an adjustment to the deferred income tax asset valuation allowance would increase income in the period such determination was made.

As part of the Business Combination, the Company assumed JATT’s public warrant and private placement warrant liabilities.

As a result of the recapitalization, the settlement provisions of the public warrants no longer preclude equity classification and the public warrants were reclassified to equity following the Business Combination.

As part of the April 2023 Private Placement, the Company sold pre-funded warrants (the “Pre-Funded Warrants”) to certain accredited investors.

The Pre-Funded Warrants were classified as equity instruments.

Classification of the public and pre-funded warrants as equity instruments and the private placement warrants as liability instruments is based on management’s analysis of the guidance in ASC 815.

The Company measures the private placement warrant liability at fair value each reporting period with the change in fair value recorded as other (expense) income in the consolidated statements of operations.

Income taxes are recorded in accordance with Accounting Standards Codification (“ASC”) 740, Income Taxes.

ASC 740 requires a company to use the asset and liability method of accounting for income taxes, whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences.

Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all of, the deferred tax assets will not be realized.

Deferred tax assets and liabilities are adjusted for the effect of changes in tax laws and rates on the date of enactment.

Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur.

The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination.

For tax positions not meeting the “more likely than not” test, no tax benefit is recorded.

The Company does not have any material uncertain tax positions for any of the reporting periods presented.

The Company recognizes accrued interest and penalties related to unrecognized tax benefits as part of income tax expense.

In connection with the Business Combination, the Company assumed JATT’s public warrant and private placement warrant liabilities.

As a result of the recapitalization, the settlement provisions of the Public Warrants (as defined herein) no longer preclude equity classification and the Public Warrants were reclassified to equity following the Business Combination.

The Public Warrants and Private Placement Warrants (as defined herein) were exchanged for Class A Ordinary Shares during the year ended December 31, 2024 (the “Warrant Exchange”).

In connection with each of the April 2024 Private Placement and April 2023 Private Placement (each as defined herein), the Company issued pre-funded warrants instruments.

Classification of the Public Warrants and Pre-Funded Warrants (as defined herein) as equity instruments and the Private Placement Warrants as liability instruments is based on management’s analysis of the guidance in ASC 815, Derivatives and Hedging .

The Company measured the private placement warrant liability at fair value each reporting period and at settlement value, based on the fair value of the Class A Ordinary Shares exchanged, upon the Warrant Exchange, with the change in fair value recorded as other (expense) income in the consolidated statements of operations.

Upon completion of the Warrant Exchange, the warrant liability was extinguished and the Class A Ordinary Shares were recorded at fair value in shareholders’ equity.

The Company measured the Public Warrants at the fair value of the equity instruments as of the Closing Date of the Business Combination.

The Company measured the pre-funded warrants at the fair value of the equity instruments as of the date of the April 2023 Private Placement.

See Note 8 for additional information.

The Company measured the Pre-Funded Warrants at the fair value of the equity instruments as of the date of the April 2023 Private Placement, the April 2024 Private Placement or the Share Exchange (as defined herein), as applicable.

Noncontrolling Interest

During April 2023, the Company’s consolidated subsidiary, ZB17, issued a share-based payment award to a third party in connection with 2023 Lilly License representing a noncontrolling interest (see Note 6 for additional information).

During April 2023, ZB17, a consolidated subsidiary of the Company, issued a share-based payment award to a third party in connection with 2023 Lilly License representing a noncontrolling interest.

A noncontrolling interest in a subsidiary is considered an ownership interest in a majority-owned subsidiary that is not attributable to the parent.

The Company includes noncontrolling interest as a component of total shareholders’ equity (deficit) on the Company’s consolidated balance sheets.

The option to acquire ZB17 ownership interests do not provide the option-holder with rights to participate in the profits and losses of the subsidiary prior to the exercise of the option.

The Company includes noncontrolling interest as a component of total shareholders’ equity in the Company’s consolidated balance sheets.

The option to acquire ZB17 ownership interests does not provide the option-holder with rights to participate in the profits and losses of the subsidiary prior to the exercise of the option.

Redeemable Noncontrolling Interest

In 2022, the Company’s consolidated subsidiary, Z33, issued 4,900,222 shares of Z33 Series Seed Preferred Shares to Stone Peach representing a noncontrolling interest (see Note 13 for additional information).

In 2022, Z33, a consolidated subsidiary of the Company, issued 4,900,222 shares of Z33 Series Seed Preferred Shares to Stone Peach representing a redeemable noncontrolling interest.

The Z33 Series Seed Preferred Shares issued to Stone Peach contain put features and are considered redeemable until the exercise or the expiration of the put features.

The redeemable noncontrolling interests are classified outside of permanent equity on the Company’s consolidated balance sheets.

The redeemable noncontrolling interest is measured at the higher of (1) its initial carrying amount, increased or decreased for the noncontrolling interest’s share of Z33’s net income or loss, or (2) the redemption price.

The redeemable noncontrolling interests are classified outside of permanent equity in the consolidated balance sheets.

The redeemable noncontrolling interest is measured at the end of each reporting period as the higher of (1) its initial carrying amount, increased or decreased for the noncontrolling interest’s share of Z33’s net income or loss, or (2) the redemption price, with any changes included in accretion of noncontrolling interest to redemption value in the consolidated statements of operations.

Net Loss Per Share

Basic net loss per share is computed by dividing net loss attributable to Class A Ordinary Shareholders by the weighted-average number of Class A Ordinary Shares outstanding, including Pre-Funded Warrants, during the period.

Diluted net loss per share excludes the potential impact of the Company’s convertible preferred shares and options to purchase Class A Ordinary Shares because their effect would be anti-dilutive due to the Company’s net loss for the periods presented.

Since the Company had a net loss in the periods presented, basic and diluted net loss per share are the same.

The table following provides potentially dilutive securities not included in the calculation of the diluted net loss per share because to do so would be anti-dilutive:

Convertible Preferred Shares

Shares issuable upon exercise of the Warrants to purchase Class A Ordinary Shares

Basic net loss per share is computed by dividing net loss attributable to Class A Ordinary Shareholders by the weighted-average number of both Class A Ordinary Shares and Pre-Funded Warrants outstanding during the period.

As the Company has a net loss, basic and diluted net loss per share was the same for each period presented as the inclusion of all potentially dilutive securities outstanding would have been anti-dilutive.

As of the periods presented, potentially dilutive securities not included in the calculation of diluted net loss per share, because to do so would be anti-dilutive, were as follows:

Shares issuable upon exercise of options to purchase Class A Ordinary Shares

Shares issuable upon exercise of Z33 Series Seed Preferred Shares Put Right

Restricted Share Units

Shares issuable upon vesting of restricted share units

Restricted share awards

Shares issuable upon exercise of warrants to purchase Class A Ordinary Shares

Recently Adopted Accounting Pronouncements

In June 2022, the FASB issued Accounting Standards Update (“ASU”) 2022-03, Fair Value Measurement (Topic 820):

Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, which clarifies the guidance of measuring the fair value of equity securities subject to contractual restrictions that prohibit the sale of the equity securities.

The Company early adopted this standard effective January 1, 2023.

The adoption of this standard did not have a material effect on the Company’s consolidated financial statements and related disclosures.

In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (“ASU 2023-07”).

ASU 2023-07 requires enhanced segment disclosures, including disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within the segment measure of profit or loss.

The enhanced disclosures are required for all entities, including entities that have only a single reportable segment, and will be applied retrospectively.

The Company adopted this standard for the year ended December 31, 2024 which resulted in additional segment disclosures (see “—Segments” above).

Recently Issued Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (“ASU 2023-07”).

ASU 2023-07 requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within the segment measure of profit or loss.

This guidance will be applied retrospectively and is effective for annual reporting periods in fiscal years beginning after December 15, 2023, and interim reporting periods in fiscal years beginning after December 31, 2024.

The Company does not expect implementation of the new guidance to have a material impact on its consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09), which requires that an entity, on an annual basis, disclose additional income tax information, primarily related to the rate reconciliation and income taxes paid.

The amendments are intended to enhance the transparency and decision usefulness of income tax disclosures.

The amendments are effective for public entities with annual periods beginning after December 15, 2024, with early adoption permitted.

The Company is currently evaluating the impact of the new standard, which is expected to result in enhanced disclosures, on its consolidated financial statements.

Improvements to Income Tax Disclosures (“ASU 2023-09”), ASU 2023-09 is intended to enhance the transparency and decision usefulness of income tax disclosures.

The amendments in the ASU address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information.

ASU 2023-09 will be effective for the Company in the annual period beginning on January 1, 2025, although early adoption is permitted.

The Company is currently evaluating the presentational effect that ASU 2023-09 will have on the Company's consolidated financial statements and disclosures, but the Company expects considerable changes to the Company’s income tax disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses (“ASU 2024-03”).

This ASU requires disclosure, in the notes to financial statements, of the nature of certain expenses included in the income statement.

ASU 2024-03 will be effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.

Early adoption is permitted.

The Company is currently evaluating the impact of ASU 2024-03 and expects to adopt it for the year ending December 31, 2027.

Recapitalization

As discussed in Note 1, Organization and Description of Business, on the Closing Date, JATT completed the acquisition of Legacy Zura and acquired 100 % of Legacy Zura’s shares and Legacy Zura received proceeds of $ 56.7 million which includes proceeds from issuance of Class A Ordinary Shares upon the consummation of the Business Combination, including the Redemption Backstop shares (as defined below), proceeds from the PIPE investment (as defined below), and proceeds from the Forward Purchase Agreement (as defined below).

As discussed in Note 1, on the Closing Date, JATT completed the acquisition of Legacy Zura and acquired 100 % of Legacy Zura’s shares and Legacy Zura received proceeds of $ 56.7 million which includes proceeds from issuance of Class A Ordinary Shares upon the consummation of the Business Combination, including the Redemption Backstop shares (as defined below), proceeds from the PIPE investment (as defined below), and proceeds from the Forward Purchase Agreement (as defined below).

The Company recorded $ 4.0 million of transaction costs, which consisted of legal, accounting, and other professional services directly related to the Business Combination.

1 unchanged sentence

On the Closing Date, each holder of Legacy Zura’s ordinary shares received approximately 108.083 shares of the Company’s Class A Ordinary Shares, par value $ 0.0001 per share.

See Note 7 for additional details of the Company’s shareholders’ equity (deficit) prior to and subsequent to the Business Combination.

All equity awards of Legacy Zura were assumed by the Company and converted into comparable equity awards that are settled or exercisable for shares of the Company’s Class A Ordinary Shares.

As a result, each outstanding share option was converted into an option exercisable for the Company’s Class A Ordinary Shares based on an exchange ratio of approximately 108.083 and each outstanding restricted share unit was converted into restricted units of the Company that, upon vesting, will be settled for the Company’s Class A Ordinary Shares based on an exchange ratio of approximately 108.083 .

Each public and private placement warrant of JATT that was unexercised at the time of the Business Combination was assumed by the Company and represents the right to purchase one Class A Ordinary Share upon exercise of such warrant.

Refer to Note 2 and Note 8 for further details.

All equity awards of Legacy Zura were assumed by the Company and converted into comparable equity awards that are exercisable for or settled in shares of the Company’s Class A Ordinary Shares.

As a result, each outstanding share option was converted into an option exercisable for the Company’s Class A Ordinary Shares based on an exchange ratio of approximately 108.083 and each outstanding restricted share unit was converted into restricted share units of the Company that, upon vesting, will be settled for the Company’s Class A Ordinary Shares based on an exchange ratio of approximately 108.083 .

Each public and private placement warrant of JATT that was unexercised at the time of the Business Combination was assumed by the Company and represented the right to purchase one Class A Ordinary Share upon exercise of such warrant.

See Notes 2 and 8.

The Business Combination was accounted for as a reverse recapitalization with Legacy Zura as the accounting acquirer and JATT as the acquired company for accounting purposes.

2 unchanged sentences

Net assets were stated at historical cost consistent with the treatment of the transaction as a reverse recapitalization of Legacy Zura.

The Company’s convertible preferred shares and Class A Ordinary Shares prior to the closing of the Business Combination (as defined in Note 1) have been retroactively restated to reflect the exchange ratio of approximately 108.083 established in the Business Combination Agreement.

The Company’s convertible preferred shares and Class A Ordinary Shares prior to the closing of the Business Combination have been retroactively restated to reflect the exchange ratio of approximately 108.083 established in the Business Combination Agreement.

The number of Class A Ordinary Shares issued and outstanding immediately following the Business Combination on March 20, 2023 was:

24 unchanged sentences

Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data.

Financial instruments consist of cash and cash equivalents, prepaid and other current assets, accounts payable and accrued expenses, note payable, private placement warrants, and research and development license consideration.

Financial instruments consist of cash and cash equivalents, prepaid and other current assets, accounts payable and accrued expenses and private placement warrants.

The carrying values of the Company’s cash, prepaid and other current assets, and accounts payable and accrued expenses approximate their fair value due to the short-term maturity of these instruments.

3 unchanged sentences

Cash equivalents

Financial liabilities:

Private placement warrants

December 31, 2023

Financial assets:

Cash equivalents

Financial liabilities:

Research and development license consideration

There were no transfers into or out of Level 1, Level 2, or Level 3 during the year ended December 31, 2023 and the period ended December 31, 2022.

The Company elected the fair value option to account for its Note payable to Hydra, LLC (see Note 10).

The fair value of the Note payable at issuance was measured as the cash proceeds from the Note.

The fair value of the Note payable subsequent to issuance was estimated using the probability-weighted expected return method (“PWERM”), whereby the total settlement obligation under the Note was determined based on the amounts payable to Hydra under various scenarios.

The PWERM’s output is determined based on inputs not observable in the market, which represented a Level 3 measurement within the fair value hierarchy.

The PWERM contemplated three scenarios:

i) the Company consummates the Business Combination without triggering an event of default, ii) the Company triggers an event of default, and consummates the Business Combination, and iii) the Company does not consummate the Business Combination.

The settlement value of each scenario was determined using a discounted cash flow model.

Significant estimates in the cash flow model include the discount rate and time to repayment.

As of December 31, 2022, the weighted average discount rate was 9.0 %, and the weighted average time to repayment was 0.6 years, each weighted by the probability of the scenario.

Upon the Closing Date of the Business Combination, the Note was remeasured to the settlement value and subsequently repaid for a total of $ 10.0 million.

The following table provides a summary of changes in the estimated fair value of the Note:

December 31, 2023

Balance at December 31, 2022

Remeasurement of the Note to settlement value upon the Closing of the Business Combination

Settlement of the Note

Balance at December 31, 2023

The Company recorded a loss on remeasurement of the Note of $ 2.2 million and $ 0.2 million for the year ended December 31, 2023 and the period ended December 31, 2022, respectively, within change in fair value of note payable in the consolidated statements of operations.

Research and development license consideration

As consideration for the 2022 Lilly License (see Note 6), Lilly agreed to receive either 550,000 Zura Class A Ordinary Shares upon the closing of the Business Combination (subject to certain lock-up provisions) or 4,702,867 shares of Z33 Series Seed Preferred Shares (the subsidiary redeemable preferred shares) if the Business Combination was not consummated.

As of December 31, 2022, the arrangement was liability classified and remeasured at fair value at each reporting date (the research and development license consideration liability).

The fair value of the research and development license consideration liability was estimated using the PWERM, whereby the total settlement obligation was determined based upon the fair value of the JATT Class A Ordinary Shares, the Z33 Series Seed Preferred Shares, and the probability of the consummation of the Business Combination.

As certain of the inputs to the PWERM are not observable in the market, the research and development license consideration liability represented a Level 3 measurement within the fair value hierarchy.

As of December 31, 2022, the fair value of JATT Class A Ordinary Shares was determined to be $ 7.66 per share, a discount to the trading price due to the shares being subject to a lock-up provision.

As of December 31, 2022, the fair value of Z33 Series Seed Preferred Shares was determined to be $ 0.15 per share.

Upon the Closing Date of the Business Combination, the liability was remeasured to its settlement value and subsequently settled through the issuance of 550,000 Class A Ordinary Shares of Zura.

The aggregate fair value of the Class A Ordinary Shares of Zura issued to Lilly was determined to be $ 4.5 million, or $ 8.16 per share.

The following table provides a summary of changes in the estimated fair value of the liability:

December 31, 2023

Balance at December 31, 2022

Remeasurement of the liability to settlement value upon the Closing of the Business Combination

Settlement of the liability

Balance at December 31, 2023

The Company recorded a loss on the remeasurement of the research and development license consideration liability of $ 1.9 million and $ 0.2 million for the year ended December 31, 2023 and the period ended December 31, 2022, respectively, within research and development in the consolidated statements of operations.

Private placement warrants

As of December 31, 2023, the Company has private placement warrants assumed in connection with the Business Combination (see Note 8).

Such warrants are measured at fair value on a recurring basis.

There were no transfers into or out of Level 1, Level 2, or Level 3 during the year ended December 31, 2024 and 2023.

Private Placement Warrants

In August 2024, pursuant to the Warrant Exchange, the Company exchanged all of the outstanding Private Placement Warrants for Class A Ordinary Shares.

The Private Placement Warrants were originally assumed in connection with the Business Combination in 2023.

The Private Placement Warrants were measured at fair value on a recurring basis.

Because the transfer of Private Placement Warrants to non-permitted transferees would result in the Private Placement Warrants having substantially the same terms as the Public Warrants, the Company determined that the fair value of each Private Placement Warrant is consistent with that of a Public Warrant.

Accordingly, the inputs used to value the private placement warrants are classified as Level 2.

Accordingly, the Private Placement Warrants are classified as Level 2 financial instruments.

Upon completion of the Warrant Exchange, the Private Placement Warrants were remeasured to settlement value which was determined based on the fair value of the Class A Ordinary Shares issued in exchange for the Private Placement Warrants.

The following table provides a summary of changes in the estimated fair value of the Private Placement Warrants:

Balance at December 31, 2022

For the Year Ended December 31,

Balance, beginning of year

Assumption of private placement warrants

Change in fair value

Balance at December 31, 2023

The Company recorded a gain from the change in fair value of the private placement warrants of $ 0.7 million for the year ended December 31, 2023 within change in fair value of private placement warrants in the consolidated statement of operations.

Exchange of private placement warrants for Class A Ordinary Shares

Balance, end of year

For the years ended December 31, 2024 and 2023, the Company recorded a loss of $ 5.2 million and a gain of $ 0.7 million, respectively, from the change in fair value of the Private Placement Warrants in change in fair value of private placement warrants in the consolidated statements of operations.

Financial Instruments Settled Upon Business Combination

The Company had two level three classified financial instruments, note payable and research and development license consideration, that were measured at fair value on a recurring basis during 2023 and settled prior to December 31, 2023.

The following table provides a summary of changes in the estimated fair value of the note payable and research and development license consideration liability:

Consideration

Balance as of December 31, 2022

Remeasurement to settlement value upon closing of the Business Combination

Settlement of liability

Balance as of December 31, 2023

On December 8, 2022, the Company received $ 7.6 million in net proceeds from the issuance of a promissory note (the “Note”) issued to Hydra, LLC (“Hydra”) with a face amount of $ 8.0 million.

The Company elected to account for the Note at fair value.

Upon the Closing Date of the Business Combination, the Note was remeasured to the settlement value and subsequently repaid for a total of $ 10.0 million.

For the year ended December 31, 2023, the Company recorded a loss on the remeasurement of the Note of $ 2.2 million in change in fair value of note payable in the consolidated statement of operations.

The Note was no longer outstanding as of December 31, 2024 and 2023.

Research and development license consideration

As consideration for the 2022 Lilly License (defined below), Lilly received 550,000 Class A Ordinary Shares upon the closing of the Business Combination (subject to certain lock-up provisions).

The arrangement was liability classified and remeasured at fair value at each reporting date prior to the Business Combination (the research and development license consideration liability).

Upon the Closing Date of the Business Combination, the liability was remeasured to its settlement value and subsequently settled through the issuance of 550,000 Class A Ordinary Shares of Zura.

The aggregate fair value of the Class A Ordinary Shares of Zura issued to Lilly was determined to be $ 4.5 million, or $ 8.16 per share.

For the year ended December 31, 2023, the Company recorded a loss on the remeasurement of the research and development license consideration liability of $ 1.9 million in research and development in the consolidated statement of operations.

The research and development license consideration liability was no longer outstanding as of December 31, 2024 and 2023.

Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses are composed of the following as of December 31, 2024 and 2023:

December 31, 2023

December 31, 2022 1

Accrued 2023 Lilly License costs

Accrued research and development costs

Accounts payable

Accrued 2023 Lilly License costs

Accrued bonus

Accrued consulting fees

Accounts payable

Accrued professional fees

Other accrued expenses

Accrued offering costs

Total accounts payable and accrued expenses

(1) Comparative figures have been reclassified to conform with current period presentation.

License Agreements

2023 Lilly License

On April 26, 2023, the Company’s consolidated subsidiary ZB17 LLC (“ZB17”) entered into a license agreement (the “2023 Lilly License” and, together with the 2022 Lilly License (as defined below), the “Lilly Licenses”) with Lilly, for an exclusive license to develop, manufacture and commercialize a certain bispecific antibody relating to IL-17 and BAFF (“ZB-106”) in exchange for an upfront payment consisting of $ 5.8 million as well as 1,000,000 Class A Ordinary Shares issued at a fair value of $ 7.84 per Class A Ordinary Share.

During 2024, ZB17 made an additional payment of $ 5.0 million to Lilly in connection with the receipt of certain know-how, data, information and materials that Lilly is required to provide under the license agreement.

The acquisition was accounted for as an asset acquisition as substantially all of the fair value of the assets acquired is concentrated in a group of similar identifiable IPR&D assets.

On the acquisition date, the compound licensed had not yet received regulatory approval and the in-process research and development did not have an alternative use.

Accordingly, the Company expensed the entire cost of the 2023 Lilly License in research and development in the consolidated statement of operations during the year ended December 31, 2023.

As a finder’s fee for arranging the acquisition of the 2023 Lilly License, ZB17 granted Stone Peach the right, but not the obligation, to purchase 4.99 % of the fully diluted equity of ZB17 for $ 1.0 million (the “Stone Peach Call Right”).

The Stone Peach Call Right is not exercisable until after the last patient is dosed in any single next clinical trial with ZB-106 and expires one year from the date of first indication approval for ZB-106 by the FDA or the European Medicines Agency (“EMA”).

The Company recognized the Stone Peach Call Right at a grant-date fair value of $ 1.5 million in research and development in the consolidated statement of operations during the year ended December 31, 2023.

The Stone Peach Call Right represents noncontrolling interest in the Company’s consolidated subsidiary, ZB17.

As of December 31, 2024 and 2023, the noncontrolling interest balance was $ 1.5 million in the consolidated balance sheets.

As additional consideration, beginning on May 1, 2023, Stone Peach receives an annual payment of $ 0.6 million initially, and increasing by 10 % annually, so long as the Company maintains its license for tibulizumab, to be paid on May 1st of each year.

The Company records expense for these annual payments when they become due.

For the years ended December 31, 2024 and 2023, the Company recorded $ 0.7 million and $ 0.6 million, respectively, in research and development in the consolidated statement of operations for the annual payments.

The Company recorded a one-time payment of $ 4.5 million for additional consideration due to Stone Peach upon approval from the FDA for its Investigational New Drug (“IND”) and commencement of the clinical trial for tibulizumab in research and development in the consolidated statement of operations for the years ended December 31, 2024 and in accounts payable and accrued expenses as of December 31, 2024.

As a finder’s fee for arranging the acquisition of the 2023 Lilly License, the Company agreed to make a one-time milestone payment of $ 5.0 million to BAFFX17, Ltd (“BAFFX17”) upon the occurrence of either:

(i) a change of control transaction, (ii) the closing of an issuance of equity or equity-linked securities by the Company of at least $ 100.0 million, (iii) the consummation of a sale of assets resulting in net proceeds in excess of $ 100.0 million, or (iv) the Company’s fully diluted shares outstanding exceed 52,500,000 shares (on a split adjusted basis) as measured on April 24th of each year.

As the Company’s fully diluted shares outstanding exceeded 52,500,000 shares prior to December 31, 2023, the $ 5.0 million fee was recorded in research and development in the consolidated statement of operations for the year ended December 31, 2023, and is included in accounts payable and accrued expenses in the consolidated balance sheets as of December 31, 2024 and December 31, 2023.

In addition to the consideration paid and/or earned during the years ended December 31, 2024 and 2023, the Company is obligated to make payments (a) to Lilly for four (4) development milestone payments up to an aggregate of $ 155.0 million, and sales milestone payments up to an aggregate of $ 440.0 million based on respective thresholds of net sales of products developed from tibulizumab;

(b) to Lilly over a multi-year period ( twelve years , or upon the later expiration of regulatory exclusivity of ZB-106 in a country) for an annual earned royalty at a marginal royalty rate in the mid-single digits to low-double digits, with increasing rates depending on net sales in the respective calendar year, based on a percentage of sales within varying thresholds for a certain period of years;

(c) to BAFFX17 for a fee equal to 3 % of any milestone or royalty payments due to Lilly pursuant to the terms of either the 2022 Lilly License or the 2023 Lilly License;

(d) to Stone Peach for a one-time milestone payment of $ 25 million upon either (i) certain equity-related transactions, or (ii) the receipt of regulatory approval from the applicable regulatory authority for any new indication in the applicable jurisdiction;

(e) to Stone Peach for a royalty of 2 % of the aggregate net sales of any products developed from the Compound (collectively, the “2023 Lilly Contingent Payments”).

As of December 31, 2024, none of the 2023 Lilly Contingent Payments are due and accordingly will not be recorded in the Company’s financial statements until they are due.

2022 Lilly License

On December 8, 2022, the Company’s consolidated subsidiary, Z33, entered into a license agreement (the “2022 Lilly License”) with Lilly pursuant to which Lilly granted Z33 an exclusive (even as to Lilly), royalty-bearing global license to develop, manufacture, and commercialize certain intellectual property owned by Lilly relating to its IL-33 compound.

As consideration, the Company paid Lilly an upfront fee of $ 7.0 million during 2022 and issued 550,000 Class A Ordinary Shares upon the closing of the Business Combination (subject to certain lock-up provisions) (the “Lilly License Fee”).

During 2022 the Company recorded expense for the entire cost of the Lilly License Fee.

Prior to the Business Combination, the obligation to issue shares represented contingent consideration and was classified as a liability in the consolidated balance sheet (research and development license consideration liability), which was settled upon the issuance of shares upon the closing of the Business Combination.

As a finder’s fee in connection with arranging the acquisition, Z33 issued to Stone Peach Properties, LLC (“Stone Peach”) 4,900,222 shares of Z33 Series Seed Preferred Shares, which was included in the measurement of the cost of the acquired asset.

The Company has the right, but not the obligation to purchase up to 50 % of the Series Seed Preferred Shares issued to Stone Peach at a price per share of $ 2.448869 for a period of two years from the date of the agreement (the “Call Option”).

Stone Peach has the right, but not the obligation to sell up to 50 % of the Series Seed Preferred Shares issued to Stone Peach to the Company for a price per share of $ 2.040724 (the “Put Option”).

In April 2023, the Company agreed to exercise its Call Option and the Company amended the settlement terms to settle the Call Option by issuing 2,000,000 Class A Ordinary Shares (the “Amended Terms”).

In November 2023, the Amended Terms were voided and the Company’s rights and obligations under the Call Option reverted to those in the original agreement (the “Second Amended Terms”).

In connection with the Second Amended Terms, the Company also provided Stone Peach with the right, but not the obligation to sell up to 50 % of the Series Seed Preferred Shares issued to Stone Peach to the Company in exchange for 2,000,000 Class A Ordinary Shares (the “Put Right”).

Stone Peach may exercise its Put Option and Put Right at any time between April 24, 2024 and April 24, 2028 under the new agreement.

Each of the Amended Terms and the Second Amended Terms were considered an extinguishment and reissuance of the Z33 Series Seed Preferred Shares, and the Z33 Series Seed Preferred Shares are remeasured to the greater of the redemption value or the initial fair value, less noncontrolling shareholder’s interest in net loss of Z33, at each subsequent reporting period.

The Z33 Series Seed Preferred Shares represent redeemable noncontrolling interest in the Company’s consolidated subsidiary, Z33.

In addition to the consideration paid in 2022 and shares issued in 2023, the Company is also obligated to make payments to Lilly for (a) for $ 3.0 million upon the completion of a financing by Z33 with gross proceeds exceeding $ 100 million;

(b) 10 commercial, development and regulatory milestone payments up to an aggregate of $ 155.0 million and sales milestone payments up to an aggregate of $ 440.0 million based on respective thresholds of net sales of products developed from the licensed compound, if any;

and (c) an annual earned royalty at a marginal royalty rate between in the mid-single to low-double digits (less than 20 %), with increasing rates based on net sales in the respective calendar year, based on a percentage of sales within varying thresholds for a certain period of the year, if any year (collectively, the “2022 Lilly Contingent Payments”).

The Company will account for these contingent milestone payments when they become due.

As of December 31, 2024, none of the 2022 Lilly Contingent Payments are due and accordingly will not be recorded in the Company’s financial statements until they are due.

Pfizer Agreement

On March 22, 2022, the Company entered into a license agreement and a Series A - 1 Subscription and Shareholder’s Agreement (collectively, the “Pfizer Agreement”) with Pfizer.

Under the Pfizer Agreement, the Company acquired a license for a compound initially developed by Pfizer, in exchange for $ 5.0 million in cash and 2,702,083 shares (as adjusted by the exchange ratio established in the Business Combination Agreement) of the Company’s Series A - 1 convertible preferred shares, representing a 20 % interest in the Company.

In accordance with ASC 805, the Pfizer Agreement is accounted for as an asset acquisition as substantially all of the $ 7.5 million value transferred to the Company was allocated to in-process research and development.

In accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations , the Pfizer Agreement is accounted for as an asset acquisition, as substantially all of the $ 7.5 million value transferred to the Company was allocated to in-process research and development.

On the acquisition date, the compound licensed had not yet received regulatory approval and the in-process research and development did not have an alternative use.

In addition to the consideration transferred on March 22, 2022, the Company is obligated to make 12 development and regulatory milestone payments aggregating up to $ 70.0 million and sales milestone payments up to an aggregate of $ 525.0 million based on respective thresholds of net sales of products (developed from the licensed compound) (the “Products”).

In further consideration for the license, the Company will also pay an annual earned royalty at a marginal royalty rate in the mid-single digits to low double digits (less than 20 %), based on thresholds of nets sales of Products.

In addition to the consideration transferred during 2022, the Company is obligated to make payments to Pfizer for (a) twelve (12) future development and regulatory milestone payments aggregating up to $ 70.0 million and sales milestone payments up to an aggregate of $ 525.0 million based on respective thresholds of net sales of products (developed from the licensed compound) (the “Products”), if any;

and (b) an annual earned royalty at a marginal royalty rate in the mid-single digits to low double digits (less than 20 %), based on thresholds of net sales of the Company’s Products, if any (collectively, the “Pfizer Contingent Payments”).

Royalties are payable on a country-by-country basis for a certain period of years or upon the later expiration of regulatory exclusivity of the Company’s Products in a country.

The Company is also subject to a potential multi-million dollar transaction payment if, within a certain period the Company has (a) certain changes in control, excluding an initial public offering or any business combination where the securities of the Company are listed on a stock exchange (e.g., a transaction with a special purpose acquisition company), or (b) the Company sublicenses or divests of its rights to the Products.

The Pfizer Agreement also has an anti-dilution provision to allow Pfizer to maintain an 18 % interest in the Company, as detailed in Note 7.

The Company recorded the first $ 1.0 million development milestone, included in the Pfizer Contingent Payments, as a component of research and development in the consolidated statement of operations during the year ended December 31, 2023.

This amount was fully paid to Pfizer during the year ended December 31, 2024.

As of December 31, 2024, no additional Pfizer Contingent Payments are due and accordingly no additional Pfizer Contingent Payments will be recorded in the Company’s financial statements until they are due.

The Pfizer Agreement also had an anti-dilution provision to allow Pfizer to maintain an 18 % interest in the Company, as detailed in Note 7.

Immediately prior to the Closing Date of the Business Combination, additional share options and restricted share units were issued to certain employees, executives, and directors that would result in the dilution of Pfizer’s ownership in the Company.

In accordance with the anti-dilution provision of the Pfizer Agreement, Pfizer was issued additional Series A-1 convertible preferred shares upon the closing of the Business Combination that were immediately converted to 267,939 Class A Ordinary Shares.

In accordance with ASC 718, the Company recognized expense related to these Class A Ordinary Shares based on their grant date fair value.

In accordance with ASC 718, Compensation – Stock Compensation , the Company recorded expense related to these Class A Ordinary Shares based on their grant date fair value.

Following the Business Combination, the anti-dilution provision is no longer in effect.

The Company recognized the first $ 1.0 million development milestone as a component of research and development in the consolidated statement of operations during the year ended December 31, 2023.

This amount due is included in accounts payable and accrued expenses on the consolidated balance sheet as of December 31, 2023.

The Company does not owe any other amounts under the Pfizer Agreement.

In July 2022, the Company entered into a license agreement (the “Lonza License”) with Lonza Sales AG (“Lonza”) for a worldwide non-exclusive license for Lonza’s gene expression system in exchange for varying considerations depending on a number of factors such as whether the Company enters further into manufacturing agreements with Lonza or with a third party, and whether the Company enters into sublicense agreements with third parties (including up to middle six-figure annual payments per sublicense upon commencement of a sublicense, as well as royalties of up to low-single digit percentages of net sales of certain products over a commercially standard double-digit multi-year term).

2 unchanged sentences

Lonza may terminate the Lonza License for cause upon a breach by the Company or for other commercially standard reasons.

During October 2023, the Company began drug substance manufacturing with a third-party.

As a result of manufacturing with a third-party other than Lonza, under the terms of the Lonza License the first annual milestone payment of $ 0.4 million became due and payable which is included in accounts payable and accrued expenses on the consolidated balance sheet as of December 31, 2023.

2022 Lilly License

As consideration, the Company paid Lilly an upfront fee of $ 7.0 million.

As consideration for the 2022 Lilly License, Lilly agreed to receive either 550,000 Class A Ordinary Shares upon the closing of the Business Combination (subject to certain lock-up provisions) or 4,702,867 shares of Z33 Series Seed Preferred Shares (the subsidiary redeemable preferred shares) if the Business Combination was not consummated.

The obligation to issue shares represents contingent consideration and is classified as a liability on the consolidated balance sheet (research and development license consideration liability) as of December 31, 2022.

The liability is measured at fair value on the acquisition date and remeasured to fair value at each reporting date.

Upon the Closing Date of the Business Combination, the Company issued Lilly 550,000 Class A Ordinary Shares at an aggregate fair value of $ 4.5 million.

The acquisition was accounted for as an asset acquisition as substantially all of the fair value of the assets acquired is concentrated in a group of similar identifiable IPR&D assets.

On the acquisition date, the compound licensed had not yet received regulatory approval and the in-process research and development did not have an alternative use.

Accordingly, the Company expensed the entire cost of the 2022 Lilly License as a component of research and development in the consolidated statement of operations during the period ended December 31, 2022.

As a finder’s fee in connection with arranging the acquisition, Z33 issued to Stone Peach Properties, LLC (“Stone Peach”) 4,900,222 shares of Z33 Series Seed Preferred Shares, which is included in the measurement of the cost of the acquired asset.

Zura has the right, but not the obligation to purchase up to 50 % of the Series Seed Preferred Shares issued to Stone Peach at a price per share of $ 2.448869 for a period of two years from the date of the agreement (the "Call Option").

Stone Peach has the right, but not the obligation to sell up to 50 % of the Series Seed Preferred Shares issued to Stone Peach to Zura for a price per share of $ 2.040724 (the "Put Option").

Stone Peach may exercise its option at any time between the first anniversary and the second anniversary of the transaction.

In April 2023, the Company agreed to, within six months of April 24, 2023, exercise its Call Option on 50 % of the Z33 Series Seed Preferred Shares previously issued to Stone Peach.

The Company agreed to settle its Call Option by issuing 2,000,000 Class A Ordinary Shares.

In November 2023, the Company and Stone Peach amended the terms of the agreement, voiding the Company's obligation to exercise its Call Option, and instead reverting the Company's rights and obligations under the Call Option back to that of the original agreement.

Stone Peach, in addition to the existing Put Option, was granted the right, but not the obligation to sell up to 50 % of the Series Seed Preferred Shares issued to Stone Peach to Zura in exchange for 2,000,000 Class A Ordinary Shares (the "Put Right").

Stone Peach may exercise its Put Option and Put Right at any time between April 24, 2024 and April 24, 2028 under the new agreement.

See Note 13 for further information.

In addition to the consideration transferred on December 8, 2022, the Company is obligated to pay $ 3.0 million to Lilly upon the completion of a financing by the Company with gross proceeds exceeding $ 100 million.

The Company is further obligated to make 10 commercial, development and regulatory milestone payments up to an aggregate of $ 155.0 million and sales milestone payments up to an aggregate of $ 440.0 million based on respective thresholds of net sales of products developed from the licensed compound.

The Company will also pay an annual earned royalty to Lilly at a marginal royalty rate between in the mid-single to low-double digits (less than 20 %), with increasing rates based on Net Sales in the respective calendar year, based on a percentage of sales within varying thresholds for a certain period of the year.

The Company will account for these contingent payments when they become due.

As of December 31, 2023, none of the contingent payments were due.

2023 Lilly License

On April 26, 2023, the Company’s newly-formed subsidiary ZB17 entered into a license agreement (the “2023 Lilly License” and, together with the 2022 Lilly License, the “Lilly Licenses”) with Lilly, for an exclusive license to develop, manufacture and commercialize a certain bispecific antibody relating to IL-17 and BAFF (“ZB-106”) in exchange for an upfront payment consisting of $ 5.8 million as well as 1,000,000 Class A Ordinary Shares issued at a fair value of $ 7.84 per Class A Ordinary Share.

In addition, ZB17 will make a payment of $ 5.0 million upon the receipt of certain know-how, data, information and materials that Lilly is required to provide under the license agreement.

The acquisition was accounted for as an asset acquisition as substantially all of the fair value of the assets acquired is concentrated in a group of similar identifiable IPR&D assets.

On the acquisition date, the compound licensed had not yet received regulatory approval and the in-process research and development did not have an alternative use.

Accordingly, the Company expensed the entire cost of the 2023 Lilly License as a component of research and development in the consolidated statement of operations during the year ended December 31, 2023.

As a finder’s fee for arranging the acquisition of the 2023 Lilly License, ZB17 granted to Stone Peach the right, but not the obligation, to purchase 4.99 % of the fully diluted equity of ZB17 for $ 1.0 million (the “Stone Peach Call Right”).

The Company recognized the Stone Peach Call Right at a grant-date fair value of $ 1.5 million as a component of research and development in the consolidated statement of operations during the year ended December 31, 2023.

The Stone Peach Call Right represents noncontrolling interest in the Company’s subsidiary, ZB17.

As of December 31, 2023 and 2022, the noncontrolling interest balance was $ 1.5 million and $- 0 -, respectively.

As additional consideration, Stone Peach will receive annual payments first of $ 0.6 million, and increasing by 10 % annually, so long as the Company maintains its license for ZB-106 and beginning on May 1, 2023.

The Company will account for these annual payments when they become due.

The Company recognized the first $ 0.6 million annual payment as a component of research and development in the consolidated statement of operations for the year ended December 31, 2023.

As the Company’s fully diluted shares outstanding exceeded 52,500,000 shares prior to December 31, 2023, the $ 5.0 million fee was recorded in accounts payable and accrued expenses on the consolidated balance sheet as of December 31, 2023 and within research and development in the consolidated statement of operations for the year ended December 31, 2023.

In addition to the consideration transferred during the year ended December 31, 2023, the Company is obligated to make 4 development milestone payments to Lilly up to an aggregate of $ 155.0 million, and sales milestone payments up to an aggregate of $ 440 million based on respective thresholds of net sales of products developed from ZB-106.

The Company is also obligated to pay Lilly over a multi-year period ( twelve years , or upon the later expiration of regulatory exclusivity of ZB-106 in a country) an annual earned royalty at a marginal royalty rate in the mid-single digits to low-double digits, with increasing rates depending on net sales in the respective calendar year, based on a percentage of sales within varying thresholds for a certain period of years.

The Company is also obligated to pay BAFFX17 a fee equal to 3 % of any milestone or royalty payments due to Lilly pursuant to the terms of either the 2022 Lilly License and the 2023 Lilly License with Lilly.

Upon receiving written approval from the FDA, EMA, or similar regulatory authority of the Investigational New Drug (“IND”) and the commencement of a clinical trial in the applicable jurisdiction for ZB-106, Stone Peach will also receive a one-time payment of $ 4.5 million.

Stone Peach will also receive a one-time milestone payment of $ 25 million upon either (i) certain equity-related transactions, or (ii) the receipt of regulatory approval from the applicable regulatory authority for any new indication in the applicable jurisdiction.

Furthermore, Stone Peach was granted a royalty of 2 % of the aggregate net sales of any products developed from the Compound.

The Company will account for these contingent payments when they become due.

As of December 31, 2023, none of the contingent payments were due.

During October 2023, the Company began drug substance manufacturing with another third party.

As a result of manufacturing with a third party other than Lonza, under the terms of the Lonza License the Company had a license fee of $ 0.4 million due to Lonza in the fourth quarter of 2023 and annually thereafter.

The Company recorded $ 0.4 million for the Lonza License in research and development in the consolidated statements of operations for the years ended December 31, 2024 and 2023.

During the year ended December 31, 2024, $ 0.4 million was paid for the Lonza License and the remaining $ 0.4 million is included in accounts payable and accrued expenses in the consolidated balance sheet as of December 31, 2024.

WuXi Biologics License

In July 2023, the Company entered into a cell line license agreement (the "Cell Line License Agreement") with WuXi Biologics and its Affiliates ("WuXi Biologics").

The Cell Line License Agreement provides the Company with a non-exclusive, worldwide, sublicensable license to certain of WuXi Biologics's know-how, cell line, and biological materials (the "WuXi Biologics Licensed Technology") to manufacture, have manufactured, use, sell and import certain products produced through the use of the cell line licensed by WuXi Biologics under the Cell Line License Agreement (the "WuXi Biologics Licensed Products").

In consideration for the license, the Company agreed to pay WuXi Biologics a non-refundable license fee of $ 150,000 which is recognized as a component of research and development in the consolidated statement of operations for the year ended December 31, 2023 and is included in accounts payable and accrued expenses on the consolidated balance sheet as of December 31, 2023.

Additionally, if the Company manufactures all of its commercial supplies of bulk drug product with a manufacturer other than WuXi Biologics or its affiliates, the Company is required to make royalty payments to WuXi Biologics in an amount equal to a fraction of a single digit percentage of global net sales of WuXi Biologics Licensed Products manufactured by a third-party manufacturer (the "Royalty").

In July 2023, the Company entered into a cell line license agreement (the “Cell Line License Agreement”) with WuXi Biologics and its Affiliates (“WuXi Biologics”) for certain of WuXi Biologics’ know-how, cell line, and biological materials (the “WuXi Biologics Licensed Technology”) to manufacture, have manufactured, use, sell and import certain products produced through the use of the cell line licensed by WuXi Biologics under the Cell Line License Agreement (the “WuXi Biologics Licensed Products”).

If the Company manufactures all of its commercial supplies of bulk drug product for WuXi Biologics Licensed Products with a manufacturer other than WuXi Biologics or its affiliates, the Company is required to make royalty payments to WuXi Biologics in an amount equal to a fraction of a single digit percentage of global net sales of WuXi Biologics Licensed Products manufactured by a third-party manufacturer (the “Royalty”).

If the Company manufactures part of its commercial supplies of the WuXi Biologics Licensed Products with WuXi Biologics or its affiliates, then the Royalty will be reduced accordingly on a pro rata basis.

The Cell Line License Agreement will continue indefinitely unless terminated (i) by the Company upon three months’ prior written notice and its payment of all undisputed amounts due to WuXi Biologics through the effective date of termination, (ii) by WuXi Biologics for a material breach by the Company that remains uncured for 30 days after written notice, or (iii) by WuXi Biologics if the Company fails to make a payment and such failure continues for 30 days after receiving notice of such failure.

Convertible Preferred Shares and Shareholders’ Equity (Deficit)

As of December 31, 2024, there are no payments currently due under the Cell Line License Agreement.

Convertible Preferred Shares and Shareholders’ Equity

Business Combination

2 unchanged sentences

On the Closing Date and in accordance with the terms and subject to the conditions of the Business Combination, each Ordinary Share of Legacy Zura, par value $ 0.001 per share, Series A-1 convertible preferred share, outstanding option (whether vested or unvested), and restricted share unit (whether vested or unvested) were canceled and converted into a comparable number of awards that consisted of either the rights to receive or acquire the Company’s Class A Ordinary Shares, par value $ 0.0001 per share, as determined by the exchange ratio pursuant to the Business Combination Agreement.

The exchange ratio is approximately 108.083 .

The exchange ratio was approximately 108.083 .

On March 16, 2023, in connection with the closing of the Business Combination and effective upon the Closing Date, the Company authorized 300,000,000 Class A Ordinary Shares, par value of $ 0.0001 and 1,000,000 preferred shares, par value of $ 0.0001 .

Shelf Registration and ATM Program

The Company filed a shelf registration statement on Form S-3 (the “Shelf Registration Statement”), which was declared effective on September 17, 2024.

Pursuant to the Shelf Registration Statement, the Company may offer and sell ordinary shares, preference shares, debt securities, warrants and or units having an aggregate public offering price of up to $ 300.0 million.

In connection with the filing of the Shelf Registration Statement, the Company also entered into a sales agreement (the “Sales Agreement”) with Leerink Partners LLC (“Leerink Partners”), relating to the sale of the Company’s Class A Ordinary Shares having an aggregate gross sales price of up to $ 125.0 million, from time to time through Leerink Partners, acting as sales agent (the “ATM”).

The Company incurred $ 0.6 million of offering expenses in connection with establishing the ATM that reduced additional paid-in capital as of December 31, 2024.

On September 18, 2024, the Company sold 1,500,000 Class A Ordinary Shares at a price of $ 3.80 per share under the ATM, for net proceeds of $ 5.5 million, after placement agent commissions.

Warrant Exchange

In connection with the Warrant Exchange, the Company issued 3,782,190 Class A Ordinary Shares.

Exchange of Class A Ordinary Shares

On August 15, 2024, the Company entered into a share surrender and warrant agreement (the “Share Exchange Agreement”) with certain affiliated shareholders (the “Shareholders”), pursuant to which (i) the Shareholders surrendered an aggregate of 4,000,000 Class A Ordinary Shares owned by the Shareholders, for no consideration, which were immediately cancelled and retired, upon surrender;

and (ii) the Company issued pre-funded warrants to purchase an aggregate of 4,000,000 Ordinary Shares, with an exercise price of $ 0.001 per share (the “Share Exchange Warrants”) (the “Share Exchange”).

April 2024 Private Placement

On April 18, 2024, the Company entered into subscription agreements (the “Investor Agreements”) with certain institutional and other accredited investors (the “Investors”), whereby the Company agreed to issue 18,732,301 Class A Ordinary Shares at a price of $ 3.108 per share and pre-funded warrants to purchase up to 16,102,348 Class A Ordinary Shares (the “2024 Pre-Funded Warrants”) at a price of $ 3.107 per 2024 Pre-Funded Warrant for an aggregate purchase price of $ 108.3 million.

See Note 8 for further information about the 2024 Pre-Funded Warrants.

On April 18, 2024, the Company also entered into subscription agreements (the “Insider Agreements” and together with the Investor Agreements, the “April 2024 Private Placement”) with certain officers, directors and affiliates of the Company (“Insiders” and together with the Investors, the “Subscribers”), whereby the Company issued 1,357,827 Class A Ordinary Shares at a price of $ 3.13 per share for an aggregate purchase price of $ 4.2 million.

The April 2024 Private Placement closed on April 22, 2024, from which the Company received total gross proceeds of approximately $ 112.5 million, before deducting transaction costs of $ 7.2 million.

April 2023 Private Placement

On April 26, 2023, the Company entered into its second PIPE subscription agreement (the “April 2023 Private Placement”) with certain accredited investors (the “Subscribers”), whereby the Company issued 15,041,530 Class A Ordinary Shares, par value $ 0.0001 per share and pre-funded warrants (the “Pre-Funded Warrants”) to purchase up to 3,782,000 Class A Ordinary Shares.

Each Class A Ordinary Share was sold at a price of $ 4.25 per Class A Ordinary Share and each Pre-Funded Warrant was sold at a price of $ 4.249 per Pre-Funded Warrant for an aggregate purchase price of $ 80.0 million.

See Note 8 for further information on the Pre-Funded Warrants.

Class A Ordinary Shares Reserved for Issuance

The summary of shares reserved for issuance as of December 31, 2024 is summarized below:

December 31, 2024

Shares issuable upon exercise of warrants to purchase Class A Ordinary Shares

Shares issuable upon exercise of options to purchase Class A Ordinary Shares

Shares available for grant under 2023 Equity Incentive Plan and ESPP

Shares issuable upon exercise of Z33 Put Right

Shares issuable upon release of restricted share units

Total shares reserved for issuance

Legacy Zura Ordinary Shares and Series A-1 Convertible Preferred Shares

Prior to the Business Combination, Legacy Zura was authorized to issue Ordinary Shares and Series A-1 convertible preferred shares.

The outstanding Ordinary Shares and Series A-1 convertible preferred shares of Legacy Zura are presented on the consolidated statement of changes in redeemable noncontrolling interest, convertible preferred shares, and shareholders’ equity (deficit) as of December 31, 2022, prior to the recapitalization (see Note 3).

As of December 31, 2024 and 2023, no Legacy Zura Ordinary Shares and no convertible preferred shares were issued and outstanding.

Series A-1 Convertible Preferred Shares Rights and Preferences

Each Series A-1 convertible preferred share is convertible, at the option of the holder thereof, at any time after the date of issuance of such share, into such number shares of the Company’s Ordinary Shares, subject to adjustment.

Each Series A-1 convertible preferred share will automatically be converted into a share of the Company’s Ordinary Shares, subject to adjustment, immediately upon the occurrence of an initial public offering with a gross aggregate subscription with respect to new Ordinary Shares of greater than $ 50.0 million.

The Ordinary Shares resulting from this conversion will rank pari passu with the existing Ordinary Shares at the time of conversion.

Each Series A-1 convertible preferred share was convertible, at the option of the holder thereof, at any time after the date of issuance of such share, into such number shares of the Company’s Ordinary Shares, subject to adjustment.

Each Series A-1 convertible preferred share would have automatically converted into a share of the Company’s Ordinary Shares, subject to adjustment, immediately upon the occurrence of an initial public offering with a gross aggregate subscription with respect to new Ordinary Shares of greater than $ 50.0 million.

The Ordinary Shares resulting from this conversion would have ranked pari passu with the existing Ordinary Shares at the time of conversion.

Anti-Dilution

If the Company issues equity securities, other than pursuant to a share option plan, the Company shall issue such number of Series A-1 convertible preferred shares to Pfizer as necessary to maintain Pfizer’s ownership interest of 18 %, until the Company raises in excess of $ 30.0 million in equity, where any capital raised above this threshold is not subject to anti-dilution.

When the Company issued equity securities, other than pursuant to a share option plan, the Company was required to issue such number of Series A-1 convertible preferred shares to Pfizer as necessary to maintain Pfizer’s ownership interest of 18 %, until the Company raised in excess of $ 30.0 million in equity, where any capital raised above this threshold is not subject to anti-dilution.

Upon the closing of the Business Combination, the anti-dilution provision was no longer in effect.

The holders of shares of Series A-1 convertible preferred shares are entitled to receive dividends, of profits available for distribution as determined by the Company’s board of directors with the consent of the majority of the shareholders, payable on a pro rata, pari passu basis.

The holders of shares of Series A-1 convertible preferred shares were entitled to receive dividends, of profits available for distribution as determined by the Company’s board of directors with the consent of the majority of the shareholders, payable on a pro rata, pari passu basis.

No dividends have been declared by the Company’s board of directors.

In the event of any voluntary or involuntary liquidation or return of capital (other than a conversion, redemption or purchase of shares) of the Company, the holders of the Series A-1 convertible preferred shares are entitled to receive a liquidation preference prior to any distribution to the holders of Ordinary Shares in the amount $ 131 per share.

In the event of any voluntary or involuntary liquidation or return of capital (other than a conversion, redemption or purchase of shares) of the Company, the holders of the Series A-1 convertible preferred shares were entitled to receive a liquidation preference prior to any distribution to the holders of Ordinary Shares in the amount of $ 131 per share.

Voting Rights

The holders of the Series A-1 convertible preferred shares are entitled to one vote per share, unless the Series A-1 shares are convertible into a greater number of Ordinary Shares or the holders of Series A-1 convertible preferred shares are entitled to any anti-dilution shares, in which case the holders of Series A-1 convertible preferred shares are entitled to the number of votes that the holder would be entitled upon conversion to Ordinary Shares or after the issuance of the anti-dilution shares, respectively.

The holders of the Series A-1 convertible preferred shares were entitled to one vote per share, unless the Series A-1 shares are convertible into a greater number of Ordinary Shares or the holders of Series A-1 convertible preferred shares were entitled to any anti-dilution shares, in which case the holders of Series A-1 convertible preferred shares were entitled to the number of votes that the holder would be entitled upon conversion to Ordinary Shares or after the issuance of the anti-dilution shares, respectively.

Redemption Rights

The Series A-1 convertible preferred shares are not mandatorily redeemable at the option of the holder.

As of December 31, 2023, no convertible preferred shares were issued and outstanding.

Prior to the Business Combination, Legacy Zura was authorized to issue Ordinary Shares and Series A-1 convertible preferred shares.

The outstanding Ordinary Shares and Series A-1 convertible preferred shares of Legacy Zura are presented on the consolidated balance sheet and on the consolidated statement of changes in redeemable noncontrolling interest, convertible preferred shares, and shareholders’ equity (deficit) for the period from January 18, 2022 (date of inception) to December 31, 2022.

Ordinary Shares Reserved for Issuance

A summary of shares reserved for issuance as of December 31, 2023 is summarized below:

December 31, 2023

Shares issuable upon exercise of options to purchase Class A Ordinary Shares

Restricted Share Units

Shares issuable upon exercise of warrants to purchase Class A Ordinary Shares

Shares issuable upon exercise of Z33 Put Right

Shares available for grant under Equity Incentive Plan

Shares available for grant under ESPP

Total shares reserved for issuance

As the accounting acquirer, Zura Bio is deemed to have assumed 5,910,000 private placement warrants to purchase Class A Ordinary Shares that were held by JATT Ventures, L.P.

(the “Sponsor”) at an exercise price of $ 11.50 and 6,899,996 public warrants to purchase Class A Ordinary Shares that were held by JATT’s public shareholders at an exercise price of $ 11.50 .

The public and private placement warrants will expire five years after the completion of the Business Combination, or earlier upon redemption or liquidation.

The Series A-1 convertible preferred shares were not mandatorily redeemable at the option of the holder.

Warrant Exchange

On July 12, 2024, the Company commenced an exchange offer (the “Exchange Offer”) and consent solicitation (the “Consent Solicitation”) relating to its outstanding warrants that it assumed in connection with the business combination, including (i) public warrants to purchase 5,910,000 Class A Ordinary Shares (the “Public Warrants”) that were held by JATT, and (ii) private placement warrants to purchase 6,899,996 Class A Ordinary Shares (the “Private Placement Warrants”) that were held by JATT shareholders (together with the Public Warrants, the “IPO warrants”).

The Company offered to all holders of the IPO warrants the opportunity to receive 0.30 Class A ordinary shares in exchange for each outstanding IPO warrant tendered by the holder and exchanged pursuant to the Exchange Offer.

Concurrently with the Exchange Offer, the Company also solicited consents from holders of the IPO warrants to amend that certain warrant agreement, dated as of July 16, 2021, by and between the Company and Continental Stock Transfer & Trust Company (“CST”), as warrant agent (the “Warrant Agreement”) to permit the Company to require that each IPO warrant outstanding upon the closing of the Exchange Offer be exchanged for 0.27 Class A ordinary shares, which is a ratio 10 % less than the exchange ratio applicable to the Exchange Offer.

Pursuant to the terms of the Warrant Agreement, all except certain specified modifications or amendments required the vote or written consent of holders of at least a majority of the outstanding public warrants and a majority of the outstanding private placement warrants.

On August 12, 2024, the Company completed the Exchange Offer and Consent Solicitation and issued 2,011,017 Class A Ordinary Shares in exchange for 6,703,428 Public Warrants and 1,224,167 Class A Ordinary Shares in exchange for 4,080,580 Private Placement Warrants.

In connection with its completion of the Exchange Offer, the Company entered into an amendment, dated August 12, 2024 (the “Warrant Amendment”), to the Warrant Agreement to provide the Company with the right to mandatorily exchange the Company’s remaining outstanding IPO warrants for Class A ordinary shares at an exchange ratio of 0.27 Class A ordinary shares for each IPO warrant.

On August 27, 2024, in accordance with the Warrant Amendment, the Company issued 547,006 Class A Ordinary Shares in exchange for the 196,568 outstanding Public Warrants and 1,829,420 outstanding Private Placement Warrants.

As a result, there are no outstanding IPO warrants as of December 31, 2024.

In connection with the Warrant Exchange, the Company paid out a de minimis amount of cash in lieu of fractional shares.

The Company incurred approximately $ 1.6 million of costs directly related to the Warrant Exchange, consisting primarily of dealer manager fees and professional, legal, filing, regulatory, and other costs, which are included in general and administrative expenses for the year ended December 31, 2024.

Public Warrants

The public warrants became exercisable into Class A Ordinary Shares commencing 30 days after the Business Combination and expire five years from the date of the Business Combination, or earlier upon redemption or liquidation.

Each warrant entitles the holder to purchase one share of the Company’s Class A Ordinary Shares at a price of $ 11.50 per share, subject to certain adjustments.

The Company may redeem, with 30 days ’ written notice, each whole outstanding public warrant for cash at a price of $ 0.01 per warrant if the Reference Value (as defined below) equals or exceeds $ 18.00 per share, subject to certain adjustments.

The warrant holders have the right to exercise their outstanding warrants prior to the scheduled redemption date at $ 11.50 per share, subject to certain adjustments.

If the Company calls the public warrants for redemption, the Company will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis”, as described in the warrant agreement.

The Public Warrants became exercisable into Class A Ordinary Shares commencing 30 days after the Business Combination with an exercise price of $ 11.50 per share, subject to certain adjustments and would have expired five years from the date of the Business Combination, or earlier upon redemption or liquidation.

Each warrant entitled the holder to purchase one share of the Company’s Class A Ordinary Shares at a price of $ 11.50 per share, subject to certain adjustments.

The Public Warrants were redeemable, with 30 days written notice, for cash at a price of $ 0.01 per warrant if the Reference Value (as defined below) equaled or exceeded $ 18.00 per share, subject to certain adjustments.

The warrant holders had the right to exercise their outstanding warrants prior to the scheduled redemption date at $ 11.50 per share, subject to certain adjustments.

If the Company called the public warrants for redemption, the Company would have the option to require all holders that wished to exercise the Public Warrants to do so on a “cashless basis”, as described in the warrant agreement.

For purposes of the redemption, “Reference Value” shall mean the last reported sales price of the Company’s Class A Ordinary Shares for any twenty trading days within the thirty trading-day period ending on the third trading day prior to the date on which notice of the redemption is given.

The Public Warrants are no longer outstanding as of December 31, 2024.

See “—Warrant Exchange” above.

Private Placement Warrants

The private placement warrants were identical to the public warrants, except that the private placement warrants are not transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions.

Additionally, the private placement warrants are exercisable on a cashless basis and are non-redeemable so long as they are held by the initial purchasers or their permitted transferees.

If the private placement warrants are held by someone other than the initial purchasers or their permitted transferees, then such warrants will be redeemable by the Company and exercisable by the warrant holders on the same basis as the public warrants.

The Private Placement Warrants were identical to the Public Warrants, except that the Private Placement Warrants were not transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions.

Additionally, Private Placement Warrants held by the initial purchasers or their permitted transferees were exercisable on a cashless basis and were non-redeemable.

The Private Placement Warrants are no longer outstanding as of December 31, 2024.

See “—Warrant Exchange” above.

Pre-Funded Warrants

In connection with the April 2023 Private Placement, the Company sold to accredited investors Pre-Funded Warrants to purchase up to 3,782,000 Class A Ordinary Shares at a price of $ 4.249 per Pre-Funded Warrant for an aggregate purchase price of approximately $ 16.1 million.

On August 15, 2024, in conjunction with the Share Exchange Agreement, the Company issued the 4,000,000 Share Exchange Warrants with an exercise price of $ 0.001 per share and no expiration date.

The Share Exchange Warrants are exercisable immediately, are exercisable until such Share Exchange Warrants are exercised in full and have substantially identical terms to the form of 2024 Pre-Funded Warrant (see below).

A holder of the Share Exchange Warrants (together with its affiliates and other attribution parties) may not exercise any portion of a Share Exchange Warrant to the extent that immediately prior to or after giving effect to such exercise the holder would beneficially own more than 9.99 % of the Company’s outstanding Class A Ordinary Shares immediately after exercise, which percentage may be increased or decreased to any other percentage specified not in excess of 9.99 % at the holder’s election upon 61 days ’ notice to the Company subject to the terms of the Share Exchange Warrants.

In connection with the April 2023 Private Placement, the Company sold to accredited investors pre-funded warrants to purchase up to 3,782,000 Class A Ordinary Shares at a price of $ 4.249 per pre-funded warrant for an aggregate purchase price of approximately $ 16.1 million (the “2023 Pre-Funded Warrants”).

Each 2023 Pre-Funded Warrant has an exercise price of $ 0.001 per Class A Ordinary Share and is exercisable for one Class A Ordinary Share at any time or times on or after April 26, 2023 until exercised in full.

The following table presents the number of warrants outstanding, their exercise price, and expiration dates as of December 31, 2023:

In connection with the April 2024 Private Placement (see Note 7), the Company sold to accredited investors the 2024 Pre-Funded Warrants to purchase up to 16,102,348 Class A Ordinary Shares.

Each 2024 Pre-Funded Warrant has an exercise price of $ 0.001 per Class A Ordinary Share and is exercisable for one Class A Ordinary Share at any time or times on or after April 22, 2024, until exercised in full.

The following table presents the number of warrants outstanding, their exercise price, and expiration dates as of December 31, 2024 and 2023:

As of December 31, 2024

Warrants Issued

1 unchanged sentence

Expiration Date

As of December 31, 2023 , no Warrants have been exercised or redeemed.

As of December 31, 2023

Warrants Issued

Exercise Price

Expiration Date

Share-Based Compensation

On June 8, 2022, Legacy Zura’s board of directors approved two stock option plans, the UK Plan (the “UK Plan”) and the US Plan (the “US Plan”) (collectively, the “Option Plans”) which permit the granting of nonqualified share options to certain employees and directors.

There were 1,501,165 Ordinary Shares available for issuance under the Option Plans, of which 383,371 Ordinary Shares were authorized for issuance under the US Plan.

On March 16, 2023, JATT’s board of directors approved the Zura Bio Limited 2023 Equity Incentive Plan (the “Equity Incentive Plan”) which became effective on the day immediately preceding the Closing Date of the Business Combination.

3 unchanged sentences

incentive bonuses, which may be paid in cash, shares, or a combination thereof;

and other share-based awards.

and other share-based awards to employees, officers, non-employee directors and other service providers.

The Company has granted share options, RSUs and RSAs that generally vest over four years and expire after 10 years .

On June 1, 2023, the Company’s board of directors approved an increase to the number of Class A Ordinary Shares that may be issued under the Equity Incentive Plan by an additional 5,564,315 Class A Ordinary Shares.

As of December 31, 2023, a maximum of 9,594,213 Class A Ordinary Shares may be issued under the Equity Incentive Plan.

The Class A Ordinary Shares issuable under the Equity Incentive Plan are subject to an annual increase on January 1st of each calendar year beginning on January 1, 2024 and ending on and including January 1, 2029, equal to the lesser of (i) 5.0 % of the aggregate number of Class A Ordinary Shares outstanding on the final day of the immediately preceding calendar year, (ii) 8,059,796 Class A Ordinary Shares or (iii) such smaller number of shares as is determined by the board.

As of January 1, 2024, the Company's board of directors decided not to apply an increase to the Class A Ordinary Shares issuable under the Equity Incentive Plan for the 2024 calendar year.

On March 16, 2023, JATT’s board of directors approved the Zura Bio Limited 2023 Employee Stock Purchase Plan (the “ESPP”) which became effective on the day immediately preceding the Closing Date of the Business Combination.

The maximum number of Class A Ordinary Shares that may be issued under the ESPP is 4,029,898 , plus an aggregate number of Class A Ordinary Shares that are added under the Equity Incentive Plan on January 1st of each calendar year, beginning on January 1, 2024 and ending on and including January 1, 2029, as discussed above.

The maximum number of Class A Ordinary Shares that may be issued under the ESPP is 4,029,898 , plus an aggregate number of Class A Ordinary Shares that are automatically added under the Equity Incentive Plan on January 1st of each calendar year, beginning on January 1, 2024 and ending on and including January 1, 2029, as discussed above.

The ESPP enables eligible employees of the Company and designated affiliates to purchase Class A Ordinary Shares at a discount of 15 %.

As of December 31, 2023, no shares have been issued under the ESPP.

As of December 31, 2024, the Company has no t activated the ESPP.

As of December 31, 2024, a maximum of 13,624,111 Class A Ordinary Shares were authorized for issuance under either the Equity Incentive Plan and ESPP, collectively.

Legacy Zura Option Plans Conversions

On June 8, 2022, Legacy Zura’s board of directors approved two share option plans, the UK Plan (the “UK Plan”) and the US Plan (the “US Plan”) (collectively, the “Option Plans”) which permit the granting of nonqualified share options to certain employees and directors.

There were 1,501,165 Ordinary Shares available for issuance under the Option Plans, of which 383,371 Ordinary Shares were authorized for issuance under the US Plan.

Upon closing of the Business Combination, all equity awards of Legacy Zura that were issued and outstanding under the Option Plans were converted into comparable equity awards that are settled or exercisable for shares of the Company’s Class A Ordinary Shares under the Equity Incentive Plan.

9 unchanged sentences

Expected dividend yield is zero based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future.

The following weighted-average assumptions were used to estimate the fair value of the Equity Incentive Plan share options issued during the year ended December 31, 2023 and the period from January 18, 2022 (date of inception) to December 31, 2022:

For the Period

from January 18,

2022 (date of

For the Year Ended

inception) to

December, 2023

December 31, 2022

The following weighted-average assumptions were used to estimate the fair value of the Equity Incentive Plan share options issued during the years ended December 31, 2024 and 2023:

For the Year Ended December 31,

Expected volatility

5 unchanged sentences

(in thousands)

Options outstanding at December 31, 2022

Recapitalization

Options outstanding at December 31, 2022

Options outstanding at December 31, 2023

Options vested and exercisable at December 31, 2023

Included in the table above are 45,611 PSOs that vested upon the Company raising external capital of $ 75 million or more.

The milestone was considered outside of the Company’s control, and accordingly, the vesting of the PSOs were not considered probable until the financing event occurs.

During the year ended December 31, 2023, the 45,611 PSOs became vested and an immaterial amount of share-based compensation expense was recognized in relation to these PSOs.

Included in the table above are 2,483,135 options to purchase Class A Ordinary Shares issued to certain directors, executives, and employees outside of the Equity Incentive Plan.

The weighted average grant date fair value of options granted during the year ended December 31, 2023 and the period from January 18, 2022 (date of inception) to December 31, 2022 was $ 5.79 and $ 1.35 , respectively.

Options outstanding as of December 31, 2023

Options outstanding as of December 31, 2024

Options vested and exercisable as of December 30, 2024

Included in options outstanding as of December 31, 2024 and 2023 in the table above are 2,165,369 and 2,483,135 , respectively, options to purchase Class A Ordinary Shares issued to certain directors, executives, and employees outside of the Equity Incentive Plan.

In December 2024, the Company granted 1,053,000 PSOs, included in the table above, that will vest upon the earlier of achieving a one year service condition or upon the Company’s Annual General Meeting (“AGM”).

The Company is recording expense over one year as the Company’s management has not deemed it probable that the AGM will be earlier than one year.

The weighted average grant date fair value of options granted during the years ended December 31, 2024 and 2023 was $ 2.71 and $ 5.79 , respectively.

Market-Based Share Options

3 unchanged sentences

These awards expire 10 years from the date of grant.

The fair value of these Market-Based Share Options were estimated using a Monte Carlo valuation method.

The following table sets forth the weighted-average assumptions used at the grant date to determine the fair value of the Company’s Market-Based Share Options granted during the year ended December 31, 2023.

No Market-Based Share Options were granted during the period from January 18, 2022 (date of inception) to December 31, 2022:

The fair value of these Market-Based Share Options were estimated using a Monte Carlo valuation method for the year ended December 31, 2023.

No Market-Based Share Options were granted during the year ended December 31, 2024.

The following table includes the weighted-average assumptions used at the grant date to determine the fair value of the Company’s Market-Based Share Options granted during the year ended December 31, 2023.

Expected volatility

3 unchanged sentences

Fair value per Market-Based Share Options

The expense recognized related to Market-Based Share Options during the year ended December 31, 2023 was approximately $ 0.5 million.

For the years ended December 31, 2024 and 2023, the Company recorded expense related to Market-Based Share Options of $ 0.7 million and $ 0.5 million, respectively.

Restricted Share Units

The Company issued RSUs to certain employees, executives, and directors pursuant to the Equity Incentive Plan.

The fair value has been estimated based on the closing price of the shares on the grant date.

Unvested RSUs at December 31, 2022

Converted to RSAs

The following table summarizes the Company’s RSU activity for the year ended December 31, 2024:

Grant Date FV

Unvested RSUs outstanding as of December 31, 2023

Vested and issued

Vested and unissued

Unvested RSUs at December 31, 2023

The expense recognized related to RSUs during the year ended December 31, 2023 and the period from January 18, 2022 (date of inception) to December 31, 2022 was approximately $ 1.6 million and $- 0 -, respectively.

Unvested RSUs as of December 31, 2024

For the years ended December 31, 2024 and 2023, the Company recorded expense related to RSUs of $ 2.0 million and $ 1.6 million, respectively.

Restricted Share Awards

The Company converted RSUs granted to a certain director pursuant to the Equity Incentive Plan into RSAs during the year ended December 31, 2023.

The fair value was estimated based on the closing price of the shares on the original grant date.

Unvested RSAs at December 31, 2022

Converted from RSUs

Unvested RSAs at December 31, 2023

The expense recognized related to RSAs during the year ended December 31, 2023 and period ended December 31, 2022 was approximately $ 0.6 million and $- 0 -, respectively.

During the year ended December 31, 2023, the Company converted RSUs granted to a certain director pursuant to the Equity Incentive Plan into RSAs.

The following table summarizes the Company’s RSA activity for the year ended December 31, 2024:

Unvested RSAs outstanding as of December 31, 2023

Unvested RSAs outstanding as of December 31, 2024

For the years ended December 31, 2024 and 2023, the Company recorded expense related to RSAs of $ 1.0 million and $ 0.6 million, respectively.

Equity Award Modification

On July 24, 2024, the Company entered into a settlement agreement with Someit Sidhu (“Settlement Agreement”) in connection with the Chief Executive Officer (“CEO”) transition.

Pursuant to the Settlement Agreement, 1,700,000 share options became fully vested and immediately exercisable and the remaining 250,000 share options will vest annually over three years on the anniversary of the Settlement Agreement.

Accordingly, for the year ended December 31, 2024, the Company recorded $ 5.9 million of share-based compensation expense, in general and administrative expense in the consolidated statement of operations, for the remaining grant date fair value of the 1,700,000 share options and the grant date fair value of the 250,000 share options is being recorded to compensation expense over the revised vesting period.

The Company determined that the Settlement Agreement did not result in any incremental expense.

On January 10, 2024, the Company and its Chief Medical Officer (the “CMO”) entered into an agreement regarding the CMO’s departure from the Company (the “Severance Agreement”).

In connection with the Severance Agreement, 67,525 of the share options previously granted to the CMO became fully vested and exercisable and 40,515 of the RSUs previously granted to the CMO became fully vested.

All remaining share options and RSUs not vested were forfeited and cancelled.

During the year ended December 31, 2024, the Company recognized a reversal of approximately $ 0.1 million of share-based compensation expense related to this modification in research and development expense in the consolidated statement of operations.

On April 7, 2023, the Company and its President and Chief Operating Officer (the “COO”) entered into an agreement regarding the COO’s departure from the Company (the “Severance Agreement”).

3 unchanged sentences

In accordance with the anti-dilution provisions of the Pfizer Agreement, Pfizer was issued additional Series A-1 convertible preferred shares upon the closing of the Business Combination that were immediately converted to 267,939 Class A Ordinary Shares.

During the year ended December 31, 2023, the Company recognized expense in the amount of $ 2.2 million within research and development in the consolidated statement of operations, related to these Class A Ordinary Shares based on their grant-date fair value.

During the year ended December 31, 2023, the Company recorded expense of $ 2.2 million in research and development in the consolidated statement of operations, related to these Class A Ordinary Shares based on their grant-date fair value.

Share-based Compensation Expense

Share-based compensation expense for all equity arrangements for the year ended December 31, 2023 and the period from January 18, 2022 (date of inception) to December 31, 2022 was as follows:

For the Period from

January 18, 2022

(date of inception) to

Share-based compensation expense for all equity arrangements for the year ended December 31, 2024 and 2023 was as follows:

For the Year Ended December 31,

Research and development

1 unchanged sentence

Total share-based compensation expense

As of December 31, 2023, there was approximately $ 19.5 million of total unrecognized share-based compensation expense related to options granted to employees, executives, and directors under the Company’s equity plans that is expected to be recognized over a weighted average period of 3.0 years.

As of December 31, 2023, there was approximately $ 7.9 million of total unrecognized share-based compensation expense related to RSUs granted to certain employees, executives, and directors under the Company’s Equity Incentive Plan that is expected to be recognized over a weighted average period of 3.4 years.

As of December 31, 2023, there was approximately $ 3.2 million of total unrecognized share-based compensation expense related to RSAs granted to a certain director under the Company’s Equity Incentive Plan that is expected to be recognized over a weighted average period of 3.2 years.

On December 8, 2022, the Company received $ 7.6 million in net proceeds from the issuance of a promissory note (the “Note”) issued to Hydra, LLC (“Hydra”) with a face amount of $ 8.0 million.

The Note accrues interest at 9 % per annum.

The maturity date of the Note is the earlier of (i) twelve months from the date of the Note or (ii) five business dates after the date on which the Company consummates the Business Combination.

The proceeds from the Note were used to acquire the 2022 Lilly License.

If the registration statement on Form S-4 relating to the Business Combination had not been declared effective by the U.S.

Securities and Exchange commission by February 15, 2023, or if the Business Combination was not consummated by March 31, 2023, Hydra had the right to accelerate the Note and receive an amount equal to 120 % of the face amount of the Note, plus accrued interest.

On March 8, 2023, the Company signed a limited waiver letter under the Note, pursuant to which Hydra agreed to waive its acceleration right in consideration of the Company paying to Hydra 125 % of the principal amount (equal to $ 10.0 million in the aggregate).

The Note was repaid on March 20, 2023, upon the consummation of the Business Combination.

The Company elected to account for the Note at fair value (see Note 4).

The Company recorded any changes in the fair value of the Note during the period through other expenses in the consolidated statements of operations.

As of December 31, 2024, unrecognized compensation costs related to the unvested share options were $ 21.2 million, which the Company expects to recognize over a weighted-average period of 2.8 years.

As of December 31, 2024, unrecognized compensation costs related to the unvested RSUs were $ 4.1 million which the Company expects to recognize over a weighted-average period of 2.2 years.

As of December 31, 2024, unrecognized compensation costs related to the unvested RSAs were $ 2.3 million which the Company expects to recognize over a weighted-average period of 2.4 years.

The components of loss before income taxes were as follows:

For the Period from

January 18, 2022

(date of inception) to

Total loss before income taxes

For the Year Ended December 31,

Loss before income taxes

Provision For Income Taxes

There is no provision for income taxes because the Company has incurred losses since its inception and maintains a full valuation allowance against its net deferred tax assets.

The reported amount of income tax expense for the period differs from the amount that would result from applying the statutory tax rate to net loss before taxes primarily because of the change in valuation allowance.

Effective January 1, 2022, the Tax Cuts and Jobs Act of 2017 requires the Company to capitalize, and subsequently amortize R&D expense over five years for research activities conducted in the U.S.

and over fifteen years for research activities conducted outside of the U.S.

Since the Company continues to be in a loss position, there is no impact to taxes payable.

The State of California does not conform to the federal capitalization requirements, allowing the Company to currently deduct the capitalized R&D costs in California.

Deferred tax assets and valuation allowance

Deferred tax assets reflect the tax effects of the Company’s loss carryforwards and temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

As of December 31, 2023, the Company had $ 24.9 million of foreign net operating loss carryforwards of which $ 24.2 million was generated in the United Kingdom and $ 0.7 million was generated in the Cayman Islands.

The NOLs generated in the United Kingdom can be carried forward indefinitely.

The NOLs generated in the Cayman Islands have no value as The Cayman Islands do not impose an income tax on corporations.

As of December 31, 2022, the Company had $ 6.3 million of foreign net operating loss carryforwards in the United Kingdom.

As of December 31, 2023, the Company had federal net operating loss carryforwards of $ 4.2 million.

The federal losses can be carried forward indefinitely.

As of December 31, 2022, the Company had federal net operating loss carryforwards of $ 0.1 million.

Under the Tax Cut and Jobs Act, NOL carryforwards arising in tax years beginning after December 31, 2021, are limited to 80% of taxable income.

The net operating loss carryforwards are subject to review and possible adjustment by the U.S.

and state tax authorities.

NOL carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders, as defined under Section 382 Internal Revenue Code.

This could limit the amount of net operating losses that the Company can utilize annually to offset future taxable income or tax liabilities.

As of December 31, 2023, the Company has not performed such an analysis evaluating the potential limitation of the Company’s net operating loss carryforwards due to the “change in ownership” provisions as defined under Sections 382 and 383 of the Internal Revenue Code.

Subsequent ownership changes and proposed future changes to tax rules in respect of the utilization of losses carried forward may further affect the limitation in future years.

A reconciliation of the expected income tax (benefit) computed using the federal statutory income tax rate to the Company’s effective income tax rate is as follows:

6 unchanged sentences

Change in deferred tax rate

The difference between the statutory federal income tax rate and the Company’s effective tax rate in 2023 and 2022 is primarily attributable to the change in valuation allowance.

The difference between the United States (“U.S.”) statutory federal income tax rate and the Company’s effective tax rate in 2024 and 2023 is primarily attributable to no tax benefit being provided on pre-tax operating losses as the Company maintains a full valuation allowance against its deferred tax assets.

Deferred Tax Assets and Valuation Allowance

The significant components of the Company’s net deferred tax assets were as follows:

4 unchanged sentences

Share-based compensation

Capitalized start-up costs

Accrued expenses and other

2 unchanged sentences

Total deferred income tax assets, net

The Company has evaluated the positive and negative evidence bearing upon its ability to realize the deferred tax assets as of December 31, 2023 and 2022.

Management has considered the Company’s history of cumulative net losses and has concluded as of December 31, 2023 and 2022, that it was more likely than not that the Company will not realize all of the benefits of the deferred tax assets.

Accordingly, a full valuation allowance has been established against the deferred tax assets as of December 31, 2023 and 2022.

The valuation allowance increased by $ 11.5 million for the year ended December 31, 2023.

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that the deferred tax assets will be realized.

The ultimate realization of deferred tax assets is based on the assessment of available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit the utilization of existing deferred tax assets.

The Company considered all positive and negative evidence when determining the amount of the net deferred tax assets that are more likely than not to be realized.

This evidence includes, but is not limited to, historical earnings, scheduled reversal of taxable temporary differences, tax planning strategies and projected future taxable income.

A significant piece of objective negative evidence evaluated was the cumulative loss incurred since the Company’s inception.

Such objective evidence limits the ability to consider subjective evidence such as the Company’s projections for future growth.

Based on this assessment, the Company maintained a full valuation allowance against the Company’s net deferred tax assets as of December 31, 2024, and 2023.

If these estimates and assumptions change in the future, the Company may be required to reduce the Company’s existing valuation allowance resulting in less income tax expense.

The Company’s overall valuation allowance increased by $ 7.8 million during 2024 resulting from current year losses for which no tax benefit was provided.

As of December 31, 2024, the Company had U.S.

federal net operating loss (“NOL”) carryforwards of approximately $ 12.4 million which may be carried forward indefinitely but are only available to offset 80 % of future taxable income.

In addition, the Company had $ 31.1 million of foreign net operating loss carryforwards of which $ 12.8 million was generated in the United Kingdom and $ 18.3 million was generated in the Cayman Islands.

The NOLs generated in the United Kingdom can be carried forward indefinitely.

The NOLs generated in the Cayman Islands have no value as the Cayman Islands do not impose any income tax on corporations.

In addition, the Company also has approximately $ 12.2 million in state net operating loss carryforwards of which the Florida NOL of $ 0.4 million can be carried forward 20 years and the Virginia NOL of $ 11.8 may be carried forward indefinitely but is only available to offset 80 % of future taxable income.

The net operating loss carryforwards are subject to review and possible adjustment by the U.S.

and state tax authorities.

Net operating loss carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders, as defined under Section 382 of the Internal Revenue Code.

This could limit the amount of NOLs that the Company could use on an annual basis to offset future taxable income or tax liabilities.

As of December 31, 2024, the Company had not performed an analysis to determine whether any of the Company’s net operating loss carryforwards are subject to limitation under Sections 382 of the Internal Revenue Code.

The Company applies the applicable authoritative guidance which prescribes a comprehensive model for the manner in which a company should recognize, measure, present and disclose in its consolidated financial statements all material uncertain tax positions that the Company has taken or expects to take on a tax return.

As of December 31, 2024, the Company had no uncertain tax positions.

There are no uncertain tax positions for which it is reasonably possible that the total amount of unrecognized tax benefits will significantly increase or decrease within twelve months of December 31, 2024.

The Company files income tax returns in the United States, the United Kingdom and certain state jurisdictions.

The U.S federal tax years open to examination by the Internal Revenue Service are 2021 to 2024.

The Company’s state and United Kingdom tax years that are open to tax examination are 2020 to 2024.

Commitments and Contingencies

5 unchanged sentences

Stone Peach has the right, but not the obligation to sell up to 50 % of the Series Seed Preferred Shares issued to Stone Peach to Zura for a price per share of $ 2.040724 (the “Put Option”).

Stone Peach may exercise its Put Option at any time between the first anniversary and the second anniversary of the transaction.

As it is not possible to specifically identify the shares that may be redeemed by exercising the Put Option, and the applicable unit of account is each share, the Company assessed that each share must be considered redeemable until the exercise or the expiration of the Put Option.

10 unchanged sentences

On December 31, 2023, the redeemable noncontrolling interest was accreted to its redemption value and the difference was recorded as an adjustment to net loss to arrive at net loss attributable to Class A ordinary shareholders for the year ended December 31, 2023 in the consolidated statement of operations.

On December 31, 2024, the redeemable noncontrolling interest was remeasured from its redemption price to its initial carry amount, decreased for the noncontrolling interest’s share of Z33’s net loss, and the difference was recorded as an adjustment to net loss to arrive at net loss attributable to Class A ordinary shareholders for the year ended December 31, 2024 in the consolidated statement of operations.

As of December 31, 2024 and 2023, the redeemable noncontrolling interest balance was $ 11.7 million and $ 18.7 million, respectively.

Defined Contribution Plans

The Company maintains a 401(k) defined contribution retirement plan (the “401(k) Plan”) for all of its U.S.

For the 401(k) Plan, the Company makes a matching contribution up to a maximum of 6 % of an employee’s annual salary.

employees, the Company contributes up to 6 % of an employee’s annual salary to defined contribution retirement pension plans.

Contributions made by the Company vest 100 % upon contribution.

For the year-ended December 31, 2024 and 2023, the Company recorded expense of $ 0.3 million and $ 0.1 million, respectively for the defined contribution plans.

Subsequent Events

The Company has evaluated subsequent events through March 27, 2024, the date the consolidated financial statements were available to be issued.

Except for the matters described below, the Company has concluded that no other events or transactions have occurred that require disclosure in the consolidated financial statements.

In January 2024, the Company entered into an employment agreement with Robert Lisicki, President and Chief Operating Officer.

In conjunction with the employment agreement, the Company awarded 1,000,000 options to purchase Class A Ordinary Shares at an exercise price of $ 3.98 per option.

The vesting of 400,000 of these options is conditional upon certain events subject to approval by the Board of Directors.

On March 24, 2024, the Board of Directors approved a CEO transition from Someit Sidhu, Chief Executive Officer and Director, to Robert Lisicki, effective April 8, 2024.

On January 1, 2025, the Class A Ordinary Shares reserved for future issuances under the Equity Incentive Plan and ESPP were each increased by the annual automatic increase of 5 % of outstanding Class A Ordinary Shares as of December 31, 2024, or 3,264,877 Class A Ordinary Shares.

In the first quarter of 2025, the Company sold 3,000,000 Class A Ordinary Shares at a price of $ 1.75 per share under the ATM, for net proceeds of $ 5.1 million, after placement agent commissions.

In February 2025, the Company granted options to purchase 3,572,790 Class A Ordinary Shares to employees under the Equity Incentive Plan.

The share options vest over four years .

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

What changed 10-K

Item 9A. Controls and Procedures