Tenaya Therapeutics, Inc.

Organization and Description of the Business

Description of the Business

Tenaya Therapeutics, Inc. (the Company) was incorporated in the state of Delaware in August 2016 and is headquartered in South San Francisco, California. The Company is a clinical-stage biotechnology company focused on discovering, developing and delivering curative therapies that address the underlying drivers of heart disease. The Company’s lead product candidates include TN-201, a gene therapy for myosin binding protein C3-associated hypertrophic cardiomyopathy, TN-401, a gene therapy for plakophilin 2-associated arrhythmogenic right ventricular cardiomyopathy, and TN-301, a small molecule for heart failure with preserved ejection fraction.

Liquidity

The Company has incurred net losses since inception and expects such losses to continue in the future as it conducts research and development activities. As of March 31, 2025, the Company had an accumulated deficit of $541.3 million. The Company incurred a net loss of $26.9 million and $32.2 million during the three months ended March 31, 2025 and 2024, respectively. The Company had $88.2 million of cash, cash equivalents and investments in marketable securities as of March 31, 2025.

On March 5, 2025, the Company completed an underwritten offering of its common stock and accompanying warrants. The Company received net proceeds of approximately $48.8 million, after deducting underwriting discounts and commissions of approximately $3.2 million and other offering expenses of approximately $0.5 million. See Note 7, Stockholders' Equity, for further details.

On August 6, 2024, the Company entered into a Loan Agreement with Silicon Valley Bank (SVB), a division of First-Citizens Bank & Trust Company (the Loan Agreement). As of the filing date of this periodic report, under the Loan Agreement, the Company has the right to draw down $22.5 million at its discretion, up to an additional $2.5 million upon the satisfaction of certain milestones and up to an additional $20.0 million that may be available at SVB's discretion, subject to specified conditions. See Note 6, Term Loan, for further details.

Management recognizes the need to raise additional capital to fully implement its business plan. The Company may seek to raise capital through equity financings, debt financings, license agreements, collaborative agreements or other sources of financing. In March 2025, the Company announced cost containment measures, including a committed plan to reduce its workforce (the 2025 Workforce Reduction), in alignment with its focus on generating data from the ongoing clinical trials of TN-201 and TN-401. See Note 11, Workforce Reduction, for further details. Management believes that savings from these measures, combined with existing cash, cash equivalents and short-term investments as of March 31, 2025, along with the $22.5 million of funds available under its Loan Agreement with SVB, will be sufficient to fund the Company’s operations for at least the next twelve months following the date these condensed financial statements are filed with the Securities and Exchange Commission (SEC).

Summary of Significant Accounting Policies

Basis of Presentation

The accompanying condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and follow the requirements of the SEC for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by GAAP can be condensed or omitted.

The interim condensed balance sheet as of March 31, 2025, the interim condensed statements of operations and comprehensive loss, stockholders’ equity and cash flows for the three months ended March 31, 2025 and 2024 are unaudited. These unaudited interim condensed financial statements have been prepared on the same basis as the Company’s annual financial statements and reflect all adjustments that are necessary for the fair statement of the Company’s financial position, results of operations and cash flows for the interim periods presented. The condensed results of operations for the three months ended March 31, 2025, are not necessarily indicative of the results to be expected for the full year or for any other future annual or interim period. The condensed balance sheet as of December 31, 2024, included herein was derived from the audited financial statements as of that date. These condensed financial statements should be read in conjunction with the Company’s audited financial statements and the related notes thereto for the year ended December 31, 2024, included in the Company’s Annual Report on Form 10-K, filed with the SEC on March 10, 2025.

Use of Estimates

The preparation of condensed financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and the disclosure of contingent assets and liabilities at the date of the condensed financial statements and the reported amounts of expenses during the reporting period. Significant estimates and assumptions made in the accompanying financial statements include, but are not limited to, accrued expenses related to research and development activities. The Company bases its estimates on historical experience, the current economic environment, and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ from those estimates or assumptions.

Significant Accounting Policies

There have been no material revisions to the Company’s significant accounting policies described in Note 2, Summary of Significant Accounting Policies, to the financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

CIRM Grant

In February 2025, the Company announced it was awarded an $8 million grant from the California Institute for Regenerative Medicine (CIRM) to support the clinical trial of TN-401. The award is payable to the Company upon achievement of certain clinical milestones. Additionally, if CIRM determines, in its sole discretion, that the Company has not complied with the terms and conditions of the grant, CIRM may suspend or permanently cease disbursements. Funds received under this grant may only be used for allowable project costs specifically identified with the CIRM-funded project. Such costs can include, but are not limited to, salary for personnel, itemized supplies, consultants, and itemized clinical study costs. Under the terms of the grant, the Company will co-fund the research project with CIRM and the amount of the Company's co-funding requirement is predetermined as a part of the award. In April 2025, the Company received $0.6 million from CIRM in connection with the grant. The Company will account for the grant under Accounting Standards Codification (ASC) 450-30, Gain Contingencies, and will record the funds against the research and development expenses as it receives them.

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2024-03, Income Statement (Topic 220): Reporting Comprehensive Income - Expense Disaggregation Disclosures, Disaggregation of Income Statement Expenses(ASU 2024-03), which requires public companies to disclose, in interim and annual reporting periods, additional information about certain expenses in the financial statements. The amendments in this ASU will be effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is evaluating the impact of this standard on its financial statements and related disclosures.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures(ASU 2023-09), which requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. The Company is evaluating the impact of this standard on its financial statements and related disclosures.

Balance Sheet Components

Property and Equipment, Net

Property and equipment, net consists of the following:

Depreciation and amortization expense for the three months ended March 31, 2025 and 2024 was $2.7 million and $2.2 million, respectively.

Accrued and Other Current Liabilities

Accrued and other current liabilities consist of the following:

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following:

Commitments and Contingencies

Facility Leases

In December 2016, the Company entered into a lease agreement for office and laboratory space in South San Francisco, California. The lease was initially set to expire in May 2025 with twofive-year renewal options. In June 2024, the Company amended the lease to extendthe term to November 2027. Pursuant to the terms of the amended lease, the Company hasone remaining five-year renewal option.

In February 2021, the Company entered into a lease agreement for office and manufacturing space in Union City, California. The lease commenced in May 2021 and has aten-year term withone five-year renewal option.

Information related to operating lease activity during the three months ended March 31, 2025 was as follows (in thousands):

As of March 31, 2025, the Company’s operating leases had a weighted average remaining lease term of 4.6 years and a weighted average discount rate of 9.0%. As of December 31, 2024, the Company’s operating leases had a weighted average remaining lease term of 4.8 years and a weighted average discount rate of 8.9%. Future minimum lease payments under the Company’s operating leases as of March 31, 2025 were as follows:

Purchase Commitments

The Company enters into contractual agreements with various suppliers in the normal course of its business, including vendors that provide machinery and equipment. All contracts are terminable, with varying provisions regarding termination. In general, if a contract with a specific vendor were to be terminated, the Company would only be obligated for the products or services that the Company had received up to the time of termination.

Indemnification

From time to time, the Company may become involved in litigation and other legal actions. The Company estimates the range of liability related to any pending litigation where the amount and range of loss can be estimated. The Company records its best estimate of a loss when the loss is considered probable. Where a liability is probable and there is a range of estimated loss with no best estimate in the range, the Company records a charge equal to at least the minimum estimated liability for a loss contingency when both of the following conditions are met: (i) information available prior to issuance of the financial statements indicates that it is probable that a liability had been incurred at the date of the financial statements and (ii) the range of loss can be reasonably estimated. The Company was not involved in any material litigation as of March 31, 2025 and December 31, 2024.

In the normal course of business, the Company enters into agreements that may include indemnification provisions. Pursuant to such agreements, the Company may indemnify, hold harmless and defend an indemnified party for losses suffered or incurred by the indemnified party. In some cases, the indemnification will continue after the termination of the agreement. The maximum potential amounts of future payments the Company could be required to make under these provisions is not determinable. In addition, the Company has entered into indemnification agreements with its directors and certain officers that may require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. As of March 31, 2025 and December 31, 2024, the Company did not have any material indemnification claims that were probable or reasonably possible and, consequently, has not recorded any related liabilities.

Stock-Based Compensation

2024 Inducement Equity Incentive Plan

In September 2024, the Board of Directors (the Board) adopted the Company's 2024 Inducement Equity Incentive Plan (the Inducement Plan), and subject to the adjustment provisions of the Inducement Plan, reserved 1,200,000 shares of the Company’s common stock for issuance pursuant to equity awards granted under the Inducement Plan. The Inducement Plan allows the Company to make equity awards to prospective employees of the Company as an inducement to such individual's commencement of employment with the Company.

Total shares reserved and available for grant under the Inducement Plan as of March 31, 2025, are 1,188,000.

2021 Equity Incentive Plan

Under the Company's 2021 Equity Incentive Plan (the 2021 Plan),4,000,000 shares of the Company’s common stock were initially reserved for issuance of equity awards to employees, directors, and consultants, under terms and provisions established by the Board. The number of shares of common stock available for issuance under the 2021 Plan automatically increases on the first day of January for a period often years, commencing on January 1, 2022, in an amount equal to the lesser of:4,000,000 shares;4% of the outstanding shares of the Company’s common stock as of the last day of the immediately preceding year; or such other amount as the board of directors may determine.

The total number of shares reserved and available for grant under the 2021 Plan as of March 31, 2025 is 2,149,004.

Repricing

On January 22, 2025, the Compensation Committee of the Company's Board approved a repricing of certain outstanding vested and unvested stock option awards under the 2016 Plan and 2021 Plan for eligible employees and certain other service providers (the Repricing Participants). The per share exercise price of eligible stock option awards was reduced to $1.21, the closing price of the Company's common stock on January 24, 2025 (the Repricing Effective Date). To receive the benefit of the repricing, Repricing Participants must remain a Service Provider (as such term is defined in the 2016 Plan or 2021 Plan) through the period (the Retention Period) that begins on the Repricing Effective Date through the earlier of July 24, 2025 or a change in control (the earlier of such dates, the Retention Date) and not exercise any of their repriced stock options prior to the Retention Date. Option holders who exercise their repriced stock options prior to the Retention Date must pay the original exercise price per share of such repriced options. No other changes were made to the terms and conditions of the eligible stock option awards. The stock option repricing impacted 4.1 million stock option awards and affected 89 employees and service providers.

On February 6, 2025, the Company's Board approved an option repricing applicable to Faraz Ali, the Company's Chief Executive Officer, with terms mirroring the aforementioned repricing approved on January 22, 2025, except that for Mr. Ali, the options eligible for repricing were limited to options with exercise prices higher than $5.25 per share. The total number of shares underlying Mr. Ali’s repriced options was 915,875 shares.

The repricing resulted in a total incremental stock-based compensation expense of $1.3 million, which was calculated using the Black-Scholes option pricing model, of which $1.0 million is associated with vested repriced options as of the Retention Date and will be recognized on a straight-line basis over the Retention Period. The remaining $0.3 million of the incremental stock-based compensation expense is associated with unvested repriced options beyond the Retention Period and will be recognized on a straight-line basis over the remaining original vesting periods. For the three months ended March 31, 2025, the Company recognized $0.4 million of incremental stock-based compensation expense.

Stock Option Activity

The following table summarizes stock option activity:

Since the reporting period covered by the table above is before the aforementioned Retention Date and any employees who exercised their repriced stock options during the reporting period would have to pay the original exercise price, the weighted average exercise price in the table above does not include the effect of repricing.

Stock option awards granted to employees generally vest over afour-year period. The contractual term of stock option awards is generally 10 years from the grant date.

Stock Option Valuation

The fair value of the Company’s stock option awards is estimated on the date of grant using the Black-Scholes option pricing model using the following assumptions:

Restricted Stock Units

Restricted stock units (RSUs) are awards that entitle the holder to receive freely tradable shares of the Company’s common stock upon the completion of a specific period of continued service. RSUs generally vest over atwo tofour year period and are subject to forfeiture if employment terminates prior to the release of vesting restrictions. RSUs are valued at the market price of the underlying common stock on the date of grant. The Company recognizes noncash compensation expense for the fair value of RSUs on a straight-line basis over the requisite service period of the awards. The following table summarizes activity of RSUs granted to employees with service-based vesting under the 2021 Plan.

2021 Employee Stock Purchase Plan

Under the Company's 2021 Employee Stock Purchase Plan (the ESPP), the Company initially reserved 800,000 sharesfor future issuance. The number of shares of common stock available for issuance under the ESPP automatically increases on the first day of each fiscal year for a period often years beginning with 2022 in an amount equal to the lesser of:800,000 shares;1% of the outstanding shares of the Company’s common stock as of the last day of the immediately preceding year; or such other amount as the Board may determine. As of March 31, 2025,2,465,077 shares were reserved for future issuance under the ESPP. Under the Company’s ESPP, employees are generally eligible to participate and can purchase shares on each purchase date established semi-annually through payroll deductions at the lower of 85% of the fair market value of the Company’s stock at the commencement of the offering period or each purchase date of the offering period. Each offering period spans 6 months. The ESPP permits eligible employees to purchase common stock through payroll deductions for up to 15% of qualified compensation, up to an annual limit of $25,000 per the Internal Revenue Service. For the three months ended March 31, 2025 and 2024, the stock-based compensation expense for ESPP was not material.

Stock-Based Compensation

The following table summarizes stock-based compensation recognized in the Company’s condensed statements of operations and comprehensive loss:

Term Loan

Loan Agreement

On August 6, 2024, the Company entered into the Loan Agreement with SVB. Pursuant to the terms of the Loan Agreement, term loans in an aggregate principal amount of up to $45.0 million may be made under multiple tranches. The tranches can be drawn as follows: the first tranche of up to $15.0 million became available on the closing date and is available for draw down through June 30, 2025; the second tranche of $5.0 million and the third tranche of $2.5 million became available in October 2024 and December 2024, respectively, upon the achievement of certain clinical milestones and are available for draw down through December 31, 2025; the fourth tranche of $2.5 million is subject to the achievement of a clinical milestone or satisfaction of certain capitalization requirements, and if achieved, would be available for draw down through December 31, 2025; and the final tranche of $20.0 million would be available for draw down through July 31, 2026, on such terms as may be agreed by the parties and subject to approval by SVB's credit committee and subject to SVB's discretion. With the exception of the final tranche, and subject to achievement of the applicable milestones and other requirements with respect to each tranche, draw downs are at the Company's election. As of March 31, 2025, the Company hasnot drawn any funds under the Loan Agreement.

Interest will accrue on the term loan advances at a rate per annum that is equal to the greater of 8.50% and the prime rate and will be payable monthly in arrears. Principal payments on any term loan advances that are borrowed would commence on January 1, 2026, subject to extension to July 1, 2026, upon the satisfaction of certain milestones.

As security for its obligations under the Loan Agreement, the Company granted SVB a security interest in substantially all of the assets of the Company, other than its intellectual property.

Stockholders' Equity

Lender Warrant

In connection with the Loan Agreement, the Company issued to SVB a warrant to purchase up to 171,848 shares of our common stock (the Lender Warrant). The Lender Warrant became exercisable for 73,649 shares upon closing (the Initial Lender Warrant), which represented 0.075% of the Company's common stock and common stock equivalents outstanding as of the day before the closing, on a fully-diluted basis, at an exercise price of $2.55 per share. The Initial Lender Warrant was classified as equity and its fair value was recorded in the stockholders’ equity section of the balance sheet. The Lender Warrant will become exercisable for up to an additional 98,199 shares pro-rated based on amounts actually advanced for the various tranches under the Loan Agreement (the Remaining Lender Warrant). The Remaining Lender Warrant under the Loan Agreement is considered an outstanding instrument upon closing of the Loan Agreement for accounting purposes. In accordance with Accounting Standards Codification (ASC) 815-40, Derivatives and Hedging - Contracts in Entity's Own Equity, the Remaining Lender Warrant is recognized at its fair value as a warrant liability given the variable settlement amount of the warrant shares and included in other non-current liabilities within the condensed balance sheets. The Lender Warrant expires on August 6, 2034.

“At-the-Market” Equity Offering

On August 10, 2022, the Company entered into a sales agreement (the Sales Agreement) with Leerink Partners LLC to establish an “at-the-market” (ATM) offering defined in Rule 415 under the Securities Act. Pursuant to the Sales Agreement, the Company is permitted to offer and sell, from time to time, shares of its common stock having a maximum aggregate offering price of up to $75.0 million. In January 2025, the Company sold 822,566 shares of our common stock under the ATM offering for net proceeds of $0.9 million, after deducting commissions and offering costs of $0.3 million. As of March 31, 2025, the Company may issue and sell up to approximately $69.8 million of common stock under the ATM offering.

Follow-On Offering

On March 5, 2025, the Company completed an underwritten public offering of 75,000,000 units, priced at a public offering price of $0.70 per unit, with each unit consisting ofone share of its common stock, a warrant to purchaseone share of its common stock at an exercise price of $0.80 per share, which will be immediately exercisable and will expire five years from the date of issuance (a Series A Warrant) and a warrant to purchaseone-half of a share of its common stock at an exercise price of $0.70 per share, which will be immediately exercisable and expire on June 30, 2026 (a Series B Warrant), under its registration statement on Form S-3 (File No. 333-266741). The Company received net proceeds of approximately $48.8 million, after deducting underwriting discounts and commissions of approximately $3.2 million and other offering expenses of approximately $0.5 million.

The Company analyzed the Series A and Series B Warrants under ASC 480, Distinguishing Liabilities from Equity, and ASC 815-40, Derivatives and Hedging - Contracts in Entity's Own Equity, and concluded that the Series A and Series B Warrants are not liabilities, are indexed to its own stock and meet all other conditions for equity classification. Accordingly, the Company has classified the Series A and Series B Warrants as permanent equity.

On February 12, 2024, the Company completed an underwritten offering of 8,888,890 shares of its common stock at a price of $4.50 per share and, to an investor in lieu of common stock, pre-funded warrants to purchase 2,222,271 shares of its common stock at a price of $4.499 per pre-funded warrant. The Company received net proceeds of approximately $46.8 million, after deducting underwriting discounts and commissions of approximately $3.0 million and offering expenses of $0.2 million. As of December 31, 2024, all pre-funded warrants have been exercised for an exercise price of $0.001 per share.

As of March 31, 2025, total shares of common stock reserved for issuance, on an as-if converted basis, are as follows:

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value as follows:

Level 1 - Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.

Level 2 - Inputs other than quoted market prices included in Level 1 are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life.

Level 3 - Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

The following tables summarize the Company’s financial assets measured at fair value on a recurring basis by level within the fair value hierarchy:

Money market funds and U.S. treasury securities are classified as Level 1 because they are valued using quoted market prices in active markets for identical assets. Financial instruments classified within Level 2 of the fair value hierarchy are valued based on observable inputs or can be derived from non-binding quotes from the Company’s investment managers, which are based on proprietary valuation models of independent pricing services. These models generally use inputs such as observable market data, quoted market prices for similar instruments, or historical pricing trends of a security relative to its peers.

The Company believes it is more likely than not that its marketable securities in an unrealized loss position will be held until maturity or the recovery of the cost basis of the investment. To date, the Company hasnot recorded any allowance for credit losses on its investment securities. Based upon its quarterly impairment review, the Company determined that the unrealized losses were not attributed to credit risk, but were primarily driven by the broader change in interest rates.

As of March 31, 2025, the fair value of available-for-sale marketable securities was $34.4 million, all of which had remaining maturities of less thanone year.

The Company's financial liability measured at fair value on a recurring basis consists of the Remaining Lender Warrant issued in connection with the Loan Agreement (see Note 6, Term Loan). The fair value of the warrant liability was determined based on significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy. The Company utilized the Black-Scholes option valuation model to fair value the warrant liability. The fair value is estimated using the Black-Scholes option-pricing model and adjusted for the likelihood of draw downs. The expected term is based on the remaining contractual term of the warrant. The Company estimates its expected stock volatility based on the historical volatility of a set of peer companies, which are publicly traded, and expects to continue to do so until it has adequate historical data regarding the volatility of its own publicly-traded stock price. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of measurement for time periods approximately equal to the expected term of the Lender Warrant. The Company uses an expected dividend yield of zero based on the fact that the Company has never paid cash dividends and does not expect to pay cash dividends in the foreseeable future. The warrant liability is subject to re-measurement at each balance sheet date, and any change in fair value is recognized as a gain or loss in our statement of operations and comprehensive loss. During the three months ended March 31, 2025, the fair value of the warrant liability and its change were not material.

The carrying amount of the Company’s remaining financial assets and liabilities, which include cash, receivables and payables, approximate their fair values due to their short-term nature.

Income Taxes

For the three months ended March 31, 2025 and 2024, the Company didnot record any income tax expense or benefit. The Company has recorded a full valuation allowance against its U.S. federal and state deferred tax assets as the Company believes it is more likely than not that the benefit will not be realized.

Net Loss Per Share

Basic and diluted loss per share are computed by dividing net loss by the weighted-average number of common shares outstanding during the reporting period. The following potentially dilutive securities were not included in the calculation of diluted net loss per share as of the periods presented because the effect would have been anti-dilutive:

Workforce Reduction

In March 2025, the Company announced cost containment measures, including a committed plan to reduce its workforce (the 2025 Workforce Reduction), in alignment with the Company's focus on generating data from the ongoing MyPEAKTM-1 and RIDGETM-1 clinical trials of TN-201 and TN-401, respectively. In connection with the 2025 Workforce Reduction, the Company estimated that it would incur approximately $1.6 million to $2.7 million of aggregate charges, primarily related to employee cash severance and continuing health benefits. During the three months ended March 31, 2025, the Company recognized $1.0 million of the total estimated charges. The Company expects to recognize substantially all of the remaining charges by the end of the third quarter of 2025.

On May 14, 2024, the Company announced cost containment measures, including a committed plan to reduce its workforce (the 2024 Workforce Reduction) by approximately 22%. The cost containment measures align with the Company's focus on generating data from its clinical-stage gene therapy programs. The 2024 Workforce Reduction was completed as of September 30, 2024. During the year ended December 31, 2024, the Company recognized $1.4 million of aggregate charges, primarily related to employee cash severance and continuing health insurance benefits.

Segment Reporting

The Company is a clinical-stage biotechnology company focused on discovering, developing and delivering curative therapies that address the underlying drivers of heart disease and hasone operating and reportable segment. The Company’s chief operating decision maker (CODM) is thechief executive officer.

The statement of operations includes research and development expenses, general and administrative costs, interest income, and income taxes; the Company has not generated any revenue. In addition to reviewing the expenses in the Company’s statement of operations, the CODM is regularly provided with operating expenses by function. The CODM does not review assets at a different asset level or category than the amounts disclosed in the Company’s balance sheet. The Company’s long-lived assets are located in the United States.

The following table provides information about the Company’s operating expenses by function and includes a reconciliation to net loss.

Subsequent Events

On April 15, 2025, the Company received a letter from the Listing Qualifications Staff (the Staff) of The Nasdaq Stock Market LLC (Nasdaq) indicating that, based upon the closing bid price of shares of the Company’s common stock for the 30 consecutive business day period between March 3, 2025, through April 12, 2025, the Company did not meet the minimum bid price of $1.00 per share required for continued listing on the Nasdaq Global Select Market pursuant to Nasdaq Listing Rule 5450(a)(1). The letter also indicated that the Company will be provided with a compliance period of 180 calendar days, or until October 13, 2025 (the “Compliance Period”), in which to regain compliance pursuant to Nasdaq Listing Rule 5810(c)(3)(A).

The letter has no immediate impact on the listing of the Company’s common stock, which will continue to be listed and traded on Nasdaq, subject to the Company’s compliance with the other listing requirements of Nasdaq.

The Company intends to actively monitor the closing bid price of its shares of common stock during the Compliance Period and may, if appropriate, evaluate available options to resolve the deficiency and regain compliance with the minimum bid price requirement. While the Company is exercising diligent efforts to maintain the listing of its common stock on the Nasdaq Global Select Market, there can be no assurance that the Company will be able to regain or maintain compliance with the minimum bid price requirement or any other Nasdaq listing standard.