Vor Biopharma Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Nature of the Business

Vor Biopharma Inc. (the “Company”) is a clinical-stage cell and genome engineering company that combines a novel patient engineering approach with targeted therapies to provide a single company solution for patients suffering from hematological malignancies. The Company’s proprietary platform leverages its expertise in hematopoietic stem cell (“HSC”) biology, genome engineering and targeted therapy development to genetically modify HSCs to remove surface targets expressed by cancer cells. The Company is headquartered in Cambridge, Massachusetts. The Company was incorporated on December 30, 2015.

On May 8, 2025, the Company announced the wind-down of its clinical and manufacturing operations, which includes a plan to implement a reduction of the Company’s workforce, as the Company conducts a process to explore strategic alternatives to maximize shareholder value. Refer to Note 13, Subsequent Events, to these interim condensed consolidated financial statements for further discussion of this non-recognized subsequent event.

Risks and Uncertainties

The Company is subject to a number of risks common to development stage companies in the biotechnology industry, including, but not limited to, risks of failure of preclinical studies and clinical trials, dependence on key personnel, protection of proprietary technology, reliance on third party organizations, uncertainty of obtaining regulatory approval for any product candidate that it may develop, development by competitors of technological innovations, compliance with government regulations, adverse macroeconomic conditions and the need to obtain additional financing. In addition, as the Company winds down its clinical and manufacturing operations and explores strategic alternatives, it is subject to additional risks, including, without limitation, risks of unforeseen delays or other challenges in winding down its operations, unintended consequences and unanticipated costs associated with the workforce reduction, such as the loss of institutional knowledge and expertise, attrition beyond the intended number of employees and decreased morale among remaining employees, and the uncertainty of consummating a strategic transaction, any of which may result in further cost-saving initiatives in the future or the business ceasing to continue as a going concern.

The Company anticipates that it will continue to incur significant operating losses as it pursues strategic alternatives aimed at maximizing shareholder value.

Liquidity and Capital Resources

As of March 31, 2025, the Company had$60.0 million of cash, cash equivalents and marketable securities and an accumulated deficit of$489.5 million. The Company has also announced that it is winding down its clinical and manufacturing operations and exploring strategic alternatives. The Company anticipates that it will continue to incur significant operating losses for the foreseeable future as it explores strategic alternatives. As a result, the Company’s continued operations are dependent on its ability to consummate a strategic transaction and/or raise additional funding. Based on its current capital resources, combined with the need to enter into a strategic transaction and/or raise additional funding and the uncertainty regarding consummating such a transaction and/or the availability of such additional funding, management has concluded that there is substantial doubt regarding the Company’s ability to continue as a going concern within one year after the date these condensed consolidated financial statements are issued. Management's plans to alleviate the conditions that raise substantial doubt regarding the Company’s ability to continue as a going concern include obtaining additional funding through equity or debt offerings and/or pursuant to collaboration or licensing arrangements. However, additional funding may not be available on terms acceptable to the Company or at all, and the Company may instead engage in, among other alternatives, a potential sale or licensing of its assets, an in-license arrangement, sale of the company, business combination, merger or other strategic transaction. There can be no assurance that the Company will be able to consummate any such strategic alternative on acceptable terms or at all.

If, for any reason, the Company utilizes its capital resources more quickly than anticipated or is unable to obtain additional funding on a timely basis and/or complete a strategic transaction, the Company may be required to further revise its business plan and strategy or cease operations. This may limit the strategic options available to the Company. As a result, the Company’s business, financial condition, and results of operations could be materially affected. The accompanying condensed consolidated financial statementsdo not include any adjustments to the carrying amounts and classification of assets and liabilities that may be necessary if the Company were unable to continue as a going concern.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) issued by the Financial Accounting Standards Board (“FASB”).

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amount of expenses during the reporting period. Actual results could differ from those estimates. Management considers many factors in selecting appropriate financial accounting policies in developing the estimates and assumptions that are used in the preparation of the condensed consolidated financial statements. Management must apply significant judgment in this process. Management’s estimation process often may yield a range of potentially reasonable estimates and management must select an amount that falls within that range of reasonable estimates. Estimates are used in the following areas, among others: accrued expenses and research and development expenses.

Unaudited Interim Financial Information

The condensed consolidated financial statements of the Company included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, the information furnished reflects all adjustments, all of which are of a normal and recurring nature, necessary for a fair presentation of the results for the reported interim periods. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year or any other interim period.

The accompanying condensed consolidated balance sheet as of December 31, 2024 has been derived from the Company’s audited consolidated financial statements for the year ended December 31, 2024. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to GAAP or the rules and regulations of the SEC. However, the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”).

During the three months ended March 31, 2025, there have been no changes to the Company’s significant accounting policies as described in the 2024 Annual Report.

3. Marketable Securities

The amortized cost and estimated fair value of marketable securities, by remaining contractual maturity, are as follows:

The Company did not have any individual securities in an unrealized loss position as of March 31, 2025 and December 31, 2024. Additionally, the Company didnot record any impairments to marketable securities or reserves for credit losses related to its marketable debt securities during the periods presented.

4. Fair Value Measurements

The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis:

The fair value of the Company’s cash equivalents and restricted cash equivalents is based on quoted market prices in active markets withno valuation adjustment. The fair value of marketable securities was determined based on observable market inputs. There wereno transfers between levels during thethree months ended March 31, 2025.

Prepaid expenses, accounts payable and accrued expenses are stated at their respective historical carrying values, which approximate fair value due to their short-term nature.

5. Property and Equipment, Net

Property and equipment, net consisted of the following:

Depreciation expense for the three months ended March 31, 2025 and 2024 was$0.8 million and$0.9 million, respectively.

6. Accrued Liabilities

Accrued liabilities consisted of the following:

7. Stockholders' Equity

Private Placement

On December 27, 2024, the Company entered into a purchase agreement with certain institutional investors (collectively, the "Purchasers"), pursuant to which the Company issued and sold to the Purchasers in a private placement an aggregate of (i)55,871,260 shares of the Company's common stock and (ii) warrants to purchase up to 69,839,075 shares of the Company's common stock (the "Warrants") at the closing of the private placement on December 30, 2024. Net proceeds from the private placement were $52.7 million, after deducting placement fees and issuance costs payable by the Company.

The Warrants have an exercise price of $0.838 per share and are immediately exercisable, subject to certain limitations on exercise set forth in the Warrants. The Warrants will terminate seven years from issuance on December 30, 2031.

The Company determined that the Warrants are freestanding instruments that do not meet the definition of a liability or derivative. The Warrants are indexed to the Company’s common stock and meet all other conditions for equity classification. Accordingly, the Warrants are classified as equity and accounted for as a component of additional paid-in capital at the time issued. The Company also determined that the Warrants should be included in the determination of diluted net loss per share if their impact is dilutive. However, they are not included within diluted net loss per share for the period ended March 31, 2025 as the effect would be antidilutive.

As of March 31, 2025, none of the Warrants have been exercised.

8. Stock-Based Compensation

2023 Inducement Plan

As of March 31, 2025, the Company had 2,656,462 shares of its common stock available for future issuance under the 2023 Inducement Plan.

2021 Equity Incentive Plan

As of March 31, 2025, the Company had 4,877,228 shares of its common stock available for future issuance under its 2021 Equity Incentive Plan.

Stock Options

The Company’s stock options generally vest over 48 months with 25% vesting afterone year followed by ratable monthly vesting over the remaining three years and have a contractual term of 10 years. The weighted-average assumptions used principally in determining the fair value of new options granted during the periods presented were as follows:

During the three months ended March 31, 2025 and 2024, the Company granted new stock options to purchase 4,043,250 shares and 1,449,975 shares of its common stock, respectively, with a weighted-average grant-date fair value of$0.99 and $1.84 per share, respectively. As of March 31, 2025, total unrecognized compensation expense related to stock options was$11.6 million, which includes incremental compensation cost related to the Option Repricing as discussed below. This amount is expected to be recognized over a weighted-average period of 1.8 years based on management’s expectations as of the balance sheet date.

As of March 31, 2025, there wereno shares that were both exercised and unvested.

Option Repricing

On February 3, 2025, the Company's board of directors approved a stock option repricing (the “Option Repricing”) whereby the exercise price of certain outstanding options to purchase shares of the Company’s common stock was reduced to $1.34 per share. The repricing applied to options to purchase shares of the Company’s common stock held by continuing employees as of February 3, 2025 that had an exercise price per share greater than $1.34; provided that holders of repriced options must remain in continuous service with the Company through February 3, 2026 or, if earlier, a change in control of the Company or 30 days prior to the applicable repriced option’s original expiration date (the “Retention Period”). If any such repriced option is exercised prior to the end of the Retention Period, the exercise price per share will be the original exercise price per share, and not the reduced exercise price. The total number of shares underlying all repriced options was approximately 6.76 million shares. The repriced options previously had exercise prices ranging from $1.36 to $44.96 per share.

Management determined that the Option Repricing represents a modification of share-based awards and calculated incremental compensation cost of approximately $1.9 million resulting from the modification. As the conditions of the modified terms were expected to be met as of the modification date and the balance sheet date, the Company determined it would recognize the incremental compensation cost associated with the modification ratably over the longer of the one-year Retention Period and the remaining service period of the original option.

Restricted Stock Units

During the three months ended March 31, 2025 and 2024, the Company granted 1,224,000 restricted stock units and 1,070,025 restricted stock units, respectively, with a weighted-average grant date fair value of$1.32 and$2.41 per share, respectively. As of

March 31, 2025, total unrecognized compensation expense related to restricted stock units was$4.4 million, which is expected to be recognized over a weighted-average period of 2.4 years.

Employee Stock Purchase Plan

As of March 31, 2025, the Company had 2,988,537 shares of its common stock available for issuance under its Employee Stock Purchase Plan (“ESPP”).

The Company didnot issue any shares of common stock under the ESPP during the three months ended March 31, 2025 and 2024.

Stock-Based Compensation

Stock-based compensation expense was allocated as follows:

9. Leases

Cambridgepark Lease Amendments

On June 15, 2021, the Company entered into the first lease amendment (“First Lease Amendment”) and second lease amendment (“Second Lease Amendment” and, together with the First Lease Amendment, the “Lease Amendments”) with PPF Off 100 Cambridge Park Drive, LLC (the “Landlord”). The Lease Amendments amended the Company’s lease agreement for its corporate office and laboratory facilities with the Landlord in Cambridge, Massachusetts to add additional leased space in the same building (the “Amended Cambridgepark Lease”).

The First Lease Amendment and Second Lease Amendment commenced for accounting purposes on January 28, 2022 and April 29, 2022, respectively. The terms of the Lease Amendments are through September 2030 for approximately $8.4 million and $22.3 million in fixed payments for the First Lease Amendment and Second Lease Amendment, respectively. There areno options to extend the Lease Amendments.

Payments due associated with the Lease Amendments include fixed and variable payments. Variable payments relate to the Company’s share of the Landlord’s operating costs associated with the underlying assets and are recognized when the event on which those payments are assessed occurs. The Amended Cambridgepark Lease does not contain a residual value guarantee. The Lease Amendments term end dates are coterminous with the existing lease agreement. In conjunction with the Lease Amendments, the Company was required to increase its irrevocable standby letter of credit to $2.4 million for the benefit of the Landlord, which has been secured by money market investments and is presented as restricted cash equivalents.

For further information regarding the Company’s Cambridgepark lease, refer to Note 9 to the consolidated financial statements included in the 2024 Annual Report.

The elements of lease expense were as follows:

Amounts reported in the condensed consolidated balance sheets and the weighted-average lease term and discount rate information were as follows:

The following table represents other lease activity:

10. Significant Agreements

Since December 31, 2024, there have been no material changes to the key terms of the Company’s license agreements. For further information regarding the Company’s existing license agreements, refer to Note 10 to the consolidated financial statements included in the 2024 Annual Report.

11. Net Loss Per Share

The following table sets forth the computation of the Company’s basic and diluted net loss per share for thethree months ended March 31, 2025 and 2024:

The Company’s potentially dilutive securities were stock options, unvested restricted stock, restricted stock units, and warrants. Based on the amounts outstanding as of March 31, 2025 and 2024, the Company excluded the following potential common shares from the computation of diluted net loss per share attributable to common stockholders because including them would have had an anti-dilutive effect:

12. Segments

The Company operates and manages its business asone reportable and operating segment, centered around the commercial development of its product candidates. The Company’s chief operating decision maker (“CODM”) is the Chief Executive Officer (“CEO”).

The Company’s CODM reviews consolidated operating results, manages the business on a consolidated basis and utilizes consolidated net loss from the consolidated statements of operations and comprehensive loss to make decisions about allocating resources and assessing performance for the entire Company. Consolidated net loss is also used to monitor budget to actual results. The CODM is additionally regularly provided with more detailed expense information at the program level.

The following table is a summary of the segment profit or loss, including significant segment expenses (in thousands):

(a) Includes only external research and development expenditures.

(b) Other segment items are primarily comprised of taxes, interest income on marketable securities and certain non-cash expenses such as stock-based compensation, depreciation expense, and non-cash lease expense.

The measure of segment assets is reported on the consolidated balance sheet as total assets. The CODM additionally reviews cash, cash equivalents and marketable securities when reviewing segment assets. As of March 31, 2025, the Company’s cash, cash equivalents and marketable securities were$60.0 million. The Company does not provide its CODM with any more detailed segment asset information than what is included on the Company’s consolidated balance sheets.

13. Subsequent Events

On May 5, 2025, the Company’s board of directors approved the wind down of the Company’s clinical and manufacturing operations as the Company conducts a process to explore strategic alternatives to maximize shareholder value. The Company publicly announced this plan on May 8, 2025.

In conjunction with this strategic process, the Company also announced a reduction of its workforce by 147 full-time employees, or approximately 95% of the Company’s then-current employee base. The reduction of workforce is expected to result in approximately $10.9 million in severance costs and such costs are primarily expected to be incurred in the second quarter of 2025. In addition, the Company expects to incur impairment charges, losses on disposals of assets, contract termination costs and other incremental expenses as a result of the strategic process and the amount of such charges and costs could be material to the Company’s results of operations and financial condition. The exact amounts and timing of recognition of such charges and costs is not yet known.