Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the consolidated financial statements and the related notes contained elsewhere in this Form 10-K. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. The known risks and uncertainties include, but are not limited to, those identified and described in detail under the caption “Risk Factors” and elsewhere in this Form 10-K.
Overview
Forte Biosciences, Inc. and its subsidiaries (www.fortebiorx.com) (“Forte”, “we”, “our”) is a clinical-stage biopharmaceutical company whose current lead product candidate is FB102. FB102 is a proprietary anti-CD122 monoclonal antibody therapeutic candidate with potentially broad autoimmune and autoimmune-related indications.
Our FB102 program aims to address key pathways implicated in these indications with a CD122 antagonist. CD122 is a subunit of IL-2/IL-15 receptors which are key regulators of NK cells and certain T cell subsets.
In FB102 mechanistic in-vitro studies, human donor T and NK cells were stimulated with either IL2 or IL15 in the presence or absence of FB102. FB102 significantly inhibited proliferation (4-5x inhibition in the proliferation of T cells and 6-8 fold inhibition in the proliferation of NK cells) and also inhibited activation of T cells. The level of FB102 inhibition of proliferation and activation was at levels comparable to unstimulated cells. Human donor regulatory T cell (Treg) studies stimulated with IL2 demonstrated comparable proliferation both in the presence and absence of FB102. Additionally, in-vitro assays demonstrated superiority of FB102 compared to competing antibodies.
In 4- and 13-week non-human primate (NHP) studies, after a single dose, FB102 demonstrated significant reductions in the NK cell pharmacodynamic marker (up to approximately 80%-90%). Additionally, after multiple doses at exposures comparable to human therapeutic doses, Treg levels in the FB102 dosing arm were similar to vehicle supporting the in-vitro data and the mechanism of action of FB102.
Three cohorts of single and two cohorts of multiple ascending doses in a Phase 1 trial of healthy volunteers were completed in which FB102 demonstrated a good safety profile. The primary objective of the Phase 1 trial was to assess the safety, tolerability and pharmacokinetics of single and multiple ascending doses of FB102. No dose limiting toxicities were observed. FB102 demonstrated significant reductions in the NK cell pharmacodynamic marker (greater than approximately 70%). Based on the successful completion of the Phase 1 healthy volunteer cohorts, we initiated a patient-based Phase 1b trial in celiac disease in the third quarter of 2024 and a patient-based Phase 1b trial for non-segmental vitiligo in the first quarter of 2025.
In June 2025, we announced positive data in our celiac disease Phase 1b study. The study enrolled 32 subjects 3:1 randomized (24 on FB102 and 8 on placebo). Subjects received 4 doses of FB102 (10 mg/kg) and underwent a 16- day gluten challenge. In addition to safety and tolerability, the study assessed morphologic and inflammatory endpoints along with gluten challenge induced symptoms.
FB102 demonstrated a statistically significant benefit on the composite histological VCIEL endpoint (change from baseline). The mean VCIEL change from baseline was -1.849 for placebo subjects compared to 0.079 for FB102 treated subjects (p=0.0099).
The change in the density of CD3-positive T cells, or IELs, from baseline was an increase of 13.3 for placebo subjects compared to a decline of 1.5 for FB102 treated subjects (p=0.0035). Baseline IEL density was 25.6 for the placebo subjects and 23.5 for the FB102 treated subjects.
The mean change in the Vh:Cd ratio from baseline was -0.173 (0.21) for placebo subjects compared to -0.046 (0.09), a 73% improvement for FB102 treated subjects compared to placebo.
Gluten challenge induced GI symptoms (nausea, vomiting, diarrhea, abdominal pain and abdominal bloating) reported during the 16-day gluten challenge from patient diaries/AE collection demonstrated a 42% benefit for FB102 treated subject (4.0 events per subject) compared to placebo (6.9 events per subject).
There were no dropouts in the study. Treatment emergent adverse events were primarily mild (grade 1) with no grade 3 or higher SAEs reported in the FB102 arm.
Based on the successful completion of our patient-based Phase 1b celiac disease study, we initiated a Phase 2 celiac study in July 2025 with the topline readout expected in 2026. In November 2025, the US FDA approved our IND application for a United States arm of our Phase 2 celiac study. Our Phase 1b non-segmental vitiligo trial is expecting topline data in the first half of 2026 and we have initiated a Phase 1b alopecia areata study with topline data expected in 2026.
Celiac disease is an autoimmune disease that is triggered by consuming gluten and results in damage to the small intestine. Symptoms include diarrhea, fatigue, headaches, anemia, nausea and dermatitis herpetiformis (an itchy skin rash). A significant patient population of celiac disease patients do not respond to gluten free diet. The health consequences for not treating include malnourishment, cancer and other autoimmune conditions. It is estimated that 1:133 in U.S. (2.5 million people) have celiac disease (Fasano, Arch Intern Med. 2003 PMID: 12578508) and that 0.3% to 0.5% of celiac disease patients are non-responsive (Malamut Gastroenterology. 2024 38556189). It has been estimated by various U.S. advocacy and epidemiology sources that up to 80% of people in the U.S. with celiac disease are undiagnosed. There are no approved treatment options for celiac disease.
Vitiligo is a disease of the skin mediated primarily by NK and CD8+ T cells that attack melanocytes leading to patchy depigmentation of the skin. It is estimated that vitiligo affects 2 million people in the United States (NIH). The global vitiligo treatment market size was estimated at $1.6-1.8 billion in 2024-2025 and is projected to reach approximately $2.3-2.7 billion by 2032-2034 (Fortune Business Insights).
Alopecia areata is a disease in which immune cells attack and damage hair follicles and is mediated primarily by CD8+ T cells and NK cells. The global alopecia treatment market has been valued at around $3-3.5 billion in 2024 with some forecasts pointing to the potential to reach $6 billion in 2032-2034 (DataM Intelligence).
Further, we believe FB102 has potentially other autoimmune and autoimmune-related applications including in type 1 diabetes ("T1D") which is caused by autoreactive T Cells destroying insulin-producing pancreatic β- cells. CD8+ T cells with receptors recognizing β-cell specific peptides are enriched in pancreatic islets of T1D patients. Environmental stress causes β-cells to upregulate MHC and to express IL-15 and IL-15RA. (Herold 2024 Nat Rev Immunol. PMID 38308004). It is estimated that 64,000 people are diagnosed with T1D annually (https://beyondtype1.org/type-1-diabetes-statistics/).
We had approximately $77.0 million in cash and cash equivalents as of December 31, 2025. Our common stock is publicly traded on the Nasdaq Capital Market under the ticker symbol FBRX. Prior to our merger with Tocagen, Inc., a publicly traded biotechnology company, Forte was a privately held company incorporated in Delaware on May 3, 2017.
In March 2025, the Company filed a new shelf registration statement on Form S-3 that was declared effective by the SEC in April 2025 for the issuance of up to $300.0 million in securities. On June 25, 2025, we closed a public offering (the “Offering”) pursuant to which we sold 5,630,450 shares of common stock at a price to the public of $12.00 per share and pre-funded warrants to purchase 619,606 shares of common stock at a price to the public of $11.999 per pre-funded warrant, which represents the per share public offering price for the shares less the exercise price for each pre-funded warrant. The gross proceeds from the Offering were $75.0 million and the Company incurred approximately $5.1 million in underwriting discounts, commissions and offering expenses. We also granted the underwriters an option, exercisable for a period of 30 days, to purchase up to an additional 937,508 shares of common stock. In July 2025, the underwriters of the Offering exercised their option and purchased 148,258 shares of common stock for gross proceeds of $1.8 million. The pre-funded warrants have an exercise price of $0.001 per share, are immediately exercisable and remain exercisable until exercised in full.
In November 2024, we issued 4,931,389 shares of our common stock at a purchase price of $5.5520 per share, and 4,615,555 pre-funded warrants to purchase shares of common stock at a purchase price of $5.5510 per pre-funded warrant ("2024 Private Placement"). The pre-funded warrants have an exercise price of $0.001 per share of common stock, are immediately exercisable and remain exercisable until exercised in full. The gross proceeds of the 2024 Private Placement were $53.0 million and we incurred $3.4 million in issuance costs. In connection with the 2024 Private Placement, we filed a registration statement on Form S-3 that was declared effective in December 2024.
Intellectual Property
We own one US patent for administering a combination of Gram-positive and Gram-negative bacteria along with metabolites for treatment of a wide variety of skin conditions. The patent’s estimated expiration date is 2039. This patent is not material to Forte’s FB102 program. We also own one pending PCT application, six pending US applications and eighteen pending foreign applications in Europe, Australia, Canada, China, Eurasia, Hong Kong, Israel, Japan, South Korea, Mexico, New Zealand, Singapore, Brazil, India, South Africa, Taiwan and Argentina related to the FB102 program. The estimated expiration dates of these patents are 2043-2046. We also own one pending US application and one pending application in Europe that is not material to Forte's FB102 program.
Macroeconomic Environment
Businesses throughout our industry have been and will continue to be impacted by a number of challenging and unexpected global and national events and circumstances that continue to evolve, including without limitation, the military conflicts in Ukraine and the Middle East, increased economic uncertainty, inflation, rising interest rates, recent and any potential future financial institution failures, trade policies, potential trade wars, and actions or inactions of the U.S. or other major national governments (including the
imposition of tariffs and retaliatory measures) and other geopolitical tensions. The extent of the impact of these events and circumstances on our business, operations and development timelines and plans remains uncertain, and will depend on certain developments, including the duration and scope of the events and their impact on our development activities, third parties with whom we do business, as well as its impact on regulatory authorities and our key scientific and management personnel. We have been and continue to actively monitor the potential impacts that these various events and circumstances may have on our business and we take steps, where warranted, to minimize any potential negative impacts on our business resulting from these events and circumstances.
In July 2025, the U.S. federal government enacted the One Big Beautiful Bill Act ("OBBBA"), a broad tax and spending bill that includes provisions impacting corporate taxpayers. The OBBBA’s various provisions include, among other things, accelerated tax deductions for qualified property and research expenditures. The legislation has multiple effective dates, with certain provisions effective in 2025 and others to be implemented through 2027. The impact of the new tax law did not have a material effect on our effective income tax rate and net deferred federal income tax assets, as we continue to maintain a full valuation allowance.
Components of Operating Results
Revenue
We have no products approved for commercial sale or in active development and have not generated any revenue from product sales. In the future, we may generate revenue from product sales, royalties on product sales, license fees, milestones, or other upfront payments if we enter into any collaborations or license agreements. We expect that our future revenue will fluctuate from quarter to quarter for many reasons, including the uncertain timing and amount of any such payments and sales.
Research and Development Expenses
Research and development costs are expensed as incurred. Research and development costs consist primarily of salaries and benefits of research and development personnel and costs related to research activities, preclinical studies, clinical trials and drug manufacturing. Non-refundable advance payments for goods or services that will be used in future research and development activities are deferred and capitalized and are only expensed when the goods have been received or when the service has been performed rather than when the payment is made.
Drug manufacturing and clinical trial costs are a component of research and development expenses. The Company expenses costs for its drug manufacturing activities performed by Contract Manufacturing Organizations (“CMOs”), costs for its preclinical and clinical trial activities performed by Contract Research Organizations (“CROs”) and other service providers, as they are incurred, based upon estimates of the work completed over the life of the individual study in accordance with associated agreements. The Company uses information it receives from internal personnel and outside service providers to estimate the percentage of completion and therefore the expense to be incurred. Our research and development expenses may fluctuate due to fluctuations in the level of manufacturing and progression of clinical activity as we continue to develop FB102.
We anticipate research and development expenses to continue to increase in the future as we develop our current lead product candidate, FB102. Our research and development expenses may increase as we continue to advance FB102 through a celiac Phase 2 trial including a U.S. arm as a result of the FDA approving our IND, multiple Phase 1b clinical trials and if we pursue additional autoimmune indications.
General and Administrative Expenses
General and administrative expenses consist primarily of professional fees such as legal, auditing, tax and business consulting services, personnel expenses and travel costs, costs associated with being a publicly traded company such as Sarbanes-Oxley compliance, accounting fees, and directors’ and officers’ liability insurance premiums. Our general and administrative expenses may fluctuate due to fluctuations in professional and legal advisory fees and generally increase as we build out our infrastructure to further develop FB102.
Interest Income
Other income consists of interest income earned on our cash, cash equivalents and short-term investment balances.
Other expense, net
Other expense, net, consists of franchise taxes and foreign exchange gains and losses.
Critical Accounting Policies, Significant Judgments and Use of Estimates
Our consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that may be readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe that the accounting policies discussed below are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.
While our significant accounting policies are described in Note 2 of our consolidated financial statements included elsewhere in this Form 10-K, we believe that the following critical accounting policies are most important to understanding and evaluating our reported financial results.
Research and Development Expenses
As part of the process of preparing our consolidated financial statements, we are required to estimate our research and development expenses. This process involves reviewing open contracts and commitments, communicating with our personnel to identify services that have been performed for us and estimating the level of service performed and the associated cost incurred for the service when we have not yet been invoiced or otherwise notified of the actual cost. We make estimates of our research and development expenses in our consolidated financial statements based on facts and circumstances known to us at that time. If our estimates of the status and timing of services performed differs from the actual status and timing of services performed, we may report amounts that are too high or too low in any particular period. To date, there have been no material differences from our estimates to the amounts actually incurred.
Stock-Based Compensation
We account for stock-based compensation arrangements with employees, directors and non-employees in accordance with Accounting Standards Codification (“ASC”) 718, Stock Compensation . Stock-based awards issued by us have been primarily stock options and restricted stock units with time-based or performance-based vesting. ASC 718 requires the recognition of compensation expense, using a fair value-based method, for costs related to all stock-based awards. To determine the grant-date fair value of stock options, we utilize the Black-Scholes option pricing model, which is impacted by the fair value of our common stock as well as other variables including, but not limited to, the expected term that stock-based awards will remain outstanding, expected common stock price volatility over the expected term of the stock-based awards, risk-free interest rates and expected dividends.
For stock-based awards with time-based vesting which includes stock options and restricted stock units, stock-based compensation is recognized over the period during which an awardee is required to provide services in exchange for the stock-based award, known as the requisite service period (usually the vesting period), on a straight-line basis. For time-based stock awards, stock-based compensation expense is recognized based on the fair value determined on the date of grant. For stock-based awards with performance-based vesting, the fair value of the award is recognized as expense when the achievement of the associated performance criteria becomes probable.
Estimates of the fair value of stock-based awards as of the grant date using the Black-Scholes option pricing model are affected by assumptions regarding a number of variables. Changes in the assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. The volatility input is subjective and generally requires significant analysis and judgment to develop and involves inherent uncertainties and the application of significant judgment. If we use significantly different assumptions or estimates, our stock-based compensation expense could be materially different.
We will continue to use judgment in evaluating the expected volatility, expected terms and interest rates utilized for our stock-based compensation expense calculations on a prospective basis.
Pre-Funded Warrants
We assessed the pre-funded warrants issued with equity financing for appropriate equity or liability classification and determined the pre-funded warrants were freestanding instruments that do not meet the definition of a liability in accordance with ASC 480 and do not meet the definition of a derivative in accordance with ASC 815.
The pre-funded warrants are classified as a component of permanent equity because they are freestanding financial instruments that are legally detachable and separately exercisable from the shares of common stock with which they were issued, are immediately exercisable, are not considered mandatorily redeemable, and permit the holders to receive a fixed number of shares of common stock upon exercise. In addition, the warrants do not provide any guarantee of value or return. Accordingly, the pre-funded warrants are classified as equity and accounted for as a component of additional paid-in capital at the time of issuance.
Shares of common stock into which the pre-funded warrants may be exercised are considered outstanding for purposes of computing net loss per share because the shares may be issued for little or no consideration and are exercisable after the original issuance date.
Results of Operations
Comparison of the Years Ended December 31, 2025 and 2024
The following tables summarize our results of operations for the years ended December 31, 2025 and 2024 (in thousands):
Year Ended December 31,
Change
Operating expenses:
Research and development
General and administrative
Total operating expenses
Loss from operations
Interest income
Other expense, net
Total other income, net
Net loss before taxes
Income tax expense
Net loss
Research and Development Expenses
Research and development expenses were $58.2 million for the year ended December 31, 2025, compared to $21.2 million during the same period in 2024. The increase was primarily due to an increase of $36 million in manufacturing and clinical expenses related to FB102 for our Phase 2 clinical trial for celiac disease and Phase 1b clinical trials for vitiligo and alopecia areata, an increase of $0.4 million in discovery work, and an increase of $1.9 million in personnel-related expenses due to an increase in headcount, partially offset by a decrease of $1.5 million in preclinical expenses as a result of toxicology work performed in 2024.
Our research and development expenses may increase as we continue to advance FB102 through a celiac Phase 2 trial including a U.S. arm as a result of the FDA approving our IND, multiple Phase 1b clinical trials and if we pursue additional autoimmune indications.
General and Administrative Expenses
General and administrative expenses were $12.4 million for the year ended December 31, 2025 compared to $15.4 million for the same period in 2024. The decrease was primarily due to decreases in professional and legal advisory fees, including litigation and settlement expenses, of $6.1 million, partially offset by an increase of $3.0 million in personnel-related expenses, including additional non-cash stock-based compensation of $2.5 million.
Our general and administrative expenses may fluctuate in the future due to fluctuations in professional and advisory fees as we build out our infrastructure to advance FB102 through a Phase 2 trial, multiple Phase 1b clinical trials and if we pursue additional autoimmune indications.
Interest Income
The increase in interest income for the year ended December 31, 2025, compared with the same period in the prior year was primarily driven by higher interest income earned from higher average cash and cash equivalents balances.
Other Expense, net
The increase in other expense, net for the year ended December 31, 2025, compared with the same period in the prior year was primarily driven by foreign exchange losses.
Income Tax Expense
Income tax expense for the year ended December 31, 2025, was related to the Company's subsidiary in Australia.
Liquidity and Capital Resources
We have no products approved for commercial sale and have not generated any revenue from product sales or other sources. We have incurred operating losses in each year since inception. Our net loss was $69.4 million for the year ended December 31, 2025. As of December 31, 2025, we had an accumulated deficit of $223.4 million. We expect to incur operating losses in the foreseeable future as we further develop FB102.
In March 2025, the Company filed a new shelf registration statement on Form S-3 that was declared effective by the SEC in April 2025 for the issuance of up to $300.0 million in securities. On June 25, 2025, the Company closed a public offering (the “Offering”) pursuant to which it sold 5,630,450 shares of common stock at a price to the public of $12.00 per share and pre-funded warrants to purchase 619,606 shares of common stock at a price to the public of $11.999 per pre-funded warrant, which represents the per share public offering price for the shares less the exercise price for each pre-funded warrant. The Company also granted the underwriters an option (the "Option"), exercisable for a period of 30 days, to purchase up to an additional 937,508 shares of common stock. The pre-funded warrants have an exercise price of $0.001 per share, are immediately exercisable and remain exercisable until exercised in full. The gross proceeds from the Offering were $75.0 million and the Company incurred approximately $5.1 million in underwriting discounts, commissions and offering expenses.
In July 2025 the underwriters of the Offering exercised the Option and purchased 148,258 shares of common stock for gross proceeds of $1.8 million and incurred issuance costs of $0.1 million.
In November 2024, the Company issued 4,931,389 shares of the Company’s common stock at a purchase price of $5.552 per Share and 4,615,555 pre-funded warrants to purchase shares of common stock at a purchase price of $5.551 per pre-funded warrant ("2024 Private Placement") in connection with a Securities Purchase Agreement (the “2024 Purchase Agreement”). The pre-funded warrants have an exercise price of $0.001 per share of common stock, are immediately exercisable and remain exercisable until exercised in full. The holders of pre-funded warrants may not exercise a pre-funded warrant if the holder, together with its affiliates, would beneficially own more than 19.99% of the number of shares of common stock outstanding immediately after giving effect to such exercise. The holders of pre-funded warrants may increase or decrease such percentages not in excess of 19.99% by providing at least 61 days’ prior notice to the Company. In connection with the 2024 Private Placement, the Company filed a registration statement to register shares on Form S-3, which was declared effective on December 20, 2024. The gross proceeds of the 2024 Private Placement were $53.0 million and the Company incurred $3.4 million in issuance costs. Certain executive officers and senior management of the Company participated in this 2024 Private Placement, purchasing $475 thousand in shares of common stock at a purchase price of $5.552 per share.
We had cash and cash equivalents of approximately $77.0 million as of December 31, 2025. We believe that our existing cash and cash equivalents will be sufficient to fund our operations for at least 12 months from the filing date of this Form 10-K.
Future Capital Requirements
We have not generated any revenue from product sales or from out-licensing. We do not know when, or if, we will generate any revenue. We expect to incur ongoing losses as we develop FB102, which we believe has potentially broad application for autoimmune and autoimmune-related indications such as celiac disease, vitiligo, alopecia areata and type 1 diabetes. FB102 is currently in clinical development in two Phase 1b and one Phase 2 clinical trials. Our future capital requirements are difficult to forecast and will depend on many factors, including but not limited to:
the initiation and progress of additional clinical trials and preclinical studies for our product candidate in other indications of FB102;
the terms and timing of any strategic alliance, licensing and other arrangements that we may establish;
the number of programs we pursue;
the outcome, timing and cost of regulatory approvals;
the cost and timing of hiring new employees to support our continued growth;
the costs involved in patent filing, prosecution, and enforcement; and
the costs and timing of having clinical supplies of our product candidates manufactured.
If we raise additional funds by issuing equity securities, our stockholders may experience dilution. Any future debt financing may impose upon us covenants that restrict our operations, including limitations on our ability to incur liens or additional debt, pay dividends, repurchase our common stock, make certain investments and engage in certain merger, consolidation or asset sale transactions. Any equity or debt financing may contain terms that are not favorable to us or our stockholders. In addition, our ability to raise additional funds may be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from the conflicts in Eastern Europe, and otherwise. If we are unable to raise additional funds when needed, we may be required to delay, reduce or terminate some or all of our development programs and clinical trials. We may also be required to sell or license to other parties rights to develop or commercialize our drug candidates that we would prefer to retain.
See “Risk Factors” for additional risks associated with our substantial capital requirements.
Summary Consolidated Statements of Cash Flows
The following table sets forth the primary sources and uses of cash for the years ended December 31, 2025 and 2024 (in thousands):
Year Ended December 31,
Net cash (used in) provided by:
Operating activities
Investing activities
Financing activities
Net increase (decrease) in cash
Operating Activities
Net cash used in operating activities for the year ended December 31, 2025 was $50.9 million and consisted primarily of a net loss of $69.4 million adjusted for non-cash stock-based compensation of $6.3 million and a decrease in net operating assets of $12.4 million.
Net cash used in operating activities for the year ended December 31, 2024 was $30.7 million and consisted primarily of a net loss of $35.5 million adjusted for non-cash stock-based compensation of $3.1 million and a decrease in net operating assets of $1.7 million.
Investing Activities
Net cash provided by investing activities for the year ended December 31, 2025 was primarily due to proceeds received from the redemption of U.S. treasury bills.
Net cash used in investing activities for the year ended December 31, 2024 was primarily due to the purchase of U.S treasury bills.
Financing Activities
Net cash provided by financing activities for the year ended December 31, 2025 was primarily due to proceeds received from the Offering of $75.0 million and from the exercise of the underwriters' option of $1.8 million, which were partially offset by the
payment of financing costs incurred in connection with the Offering, the underwriters' option exercise, and the 2024 Private Placement costs incurred in 2024 but paid in 2025.
Net cash provided by financing activities for the year ended December 31, 2024 was primarily due to the net proceeds of $51.9 million received from our 2024 Private Placement of 4,931,389 shares of the Company’s common stock at a purchase price of $5.552 per share, and 4,615,555 pre-funded warrants to purchase shares of common stock at a purchase price of $5.551 per pre-funded warrant.
Indemnification
As permitted under Delaware law and in accordance with our bylaws, we indemnify our officers and directors for certain events or occurrences while the officer or director is or was serving in such capacity pursuant to indemnification agreements. We believe the fair value of the indemnification rights and agreements is minimal. Accordingly, we have not recorded any liabilities for these indemnification rights and agreements as of December 31, 2025 and 2024.
Contractual Obligations
See Note 6 Commitments and Contingencies to the Consolidated Financial Statements included elsewhere in this Form 10-K.
Item 7A. Quantitative and Qualitati ve Disclosures About Market Risk
We are a smaller reporting company as defined by Rule 12b‑2 of the Securities Exchange Act of 1934, as amended, and are not required to provide the information required under this item.
Item 8. Financial Statement s and Supplementary Data
The information required by this Item 8 is included in Part IV, Item 15 of this Annual Report on Form 10-K and is incorporated herein by reference.
