Alaunos Therapeutics, Inc.

Current report

Our business faces significant and evolving risks, many of which are described in the section captioned “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on March 31, 2025, as amended by Amendment No. 1 filed on April 30, 2025, and in our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2025 (filed May 15, 2025), June 30, 2025 (filed August 14, 2025), and September 30, 2025 (this Quarterly Report). These risks are compounded by external events beyond our control, including the ongoing U.S. government shutdown (effective October 1, 2025), which has introduced new and material risks related to SEC registration statement effectiveness, Nasdaq compliance, and our ability to execute strategic alternatives.

Current report

The risks described in our prior and current filings may not be exhaustive. Additional risks of which we are currently unaware, or that we presently deem immaterial, may also emerge or intensify and materially impair our business, financial condition, results of operations, cash flows, or prospects. If any of the events or circumstances described in these risk factors occur — including, without limitation, a prolonged government shutdown, SEC stop order, or Nasdaq delisting — our operations may be curtailed, our strategic process may fail, and we may be forced to pursue dissolution or bankruptcy, resulting in a total loss of your investment. Investors and prospective investors must carefully consider the risks detailed in our Annual Report, Quarterly Reports, and this Form 10-Q, along with the “Forward-Looking Statements” section and all other information herein, before making any investment decision.

Current report

The Ongoing U.S. Government Shutdown and Its Impact on SEC and FDA Operations Pose Existential Risks to Our Business.

Current report

The federal government shutdown, effective October 1, 2025, has furloughed non-essential personnel at the SEC, severely disrupting operations critical to our survival as a pre-clinical biotech with $1.9 million in cash and a runway into Q1 2026. While EDGAR remains operational for filings, the absence of agency staff creates material risks across capital raising, regulatory advancement, Nasdaq compliance, and strategic alternatives.

Current report

SEC Registration Statement Risks

Current report

Our Form S-1, filed October 22, 2025, became automatically effective on November 11, 2025 — the 20th calendar day after the deemed filing date pursuant to SEC Rule 473. Our Form S-3, filed November 7, 2025, is scheduled for automatic effectiveness on November 27, 2025 (Thanksgiving Day), with the 20-calendar-day clock unaffected by weekends or federal holidays. The shutdown does not suspend this automatic effectiveness but eliminates pre-effectiveness review, comment resolution, and acceleration. Upon resumption of SEC operations, a post-effectiveness stop order under Section 8(d) of the Securities Act could be issued if material deficiencies are identified in backlog reviews. Such an order would suspend all sales under our $25 million equity line of credit and follow-on offerings, blocking the capital necessary to extend our runway beyond March 2026.

Current report

Nasdaq Delisting and Strategic Transaction Risks

Current report

Filing deadlines remain in force. Any inability to resolve SEC comment backlogs on future 10-Qs/10-Ks risks Nasdaq delisting under Rule 5250(c)(1). Our stockholders’ equity, at $2.82 million on September 30, 2025, is vulnerable to erosion from operating losses (~$0.28 million/month), potentially triggering a deficiency notice. The shutdown also freezes SEC review of proxy statements and Form S-4 filings, stalling our Cantor Fitzgerald-led strategic process (e.g., reverse merger, asset sale). Historical data from the 2018–19 shutdown shows 40% of micro-cap biotechs in similar positions faced delisting or dissolution within 12 months due to funding and regulatory gridlock. If the shutdown extends beyond 30 days, or if SEC backlogs persist post-resumption, we may be forced to curtail operations, pursue dissolution, or file for bankruptcy. These outcomes could result in a total loss for stockholders and materially adversely affect our business, financial condition, results of operations, cash flows, and prospects.

Current report

On July 3, 2025, certain members of the Board of Directors of the Company elected to receive compensation in equity rather than in cash for their second quarter board service fees. The total deferred board service fees amounted to $37 thousand. In exchange for these deferred fees, the Company issued 7,450 shares of common stock, each with a par value of $0.001.

Previous report

The following important factors could cause our actual business and financial results to differ materially from those contained in forward-looking statements made in this Quarterly Report on Form 10-Q or elsewhere by management from time to time. The risk factors in this Quarterly Report have been revised to incorporate changes to our risk factors from those included in our Annual Report. The risk factors set forth below with an asterisk (*) before the title are new risk factors or ones containing substantive changes from the risk factors previously disclosed in Item 1A of our 2024 Annual Report. The market price of our common stock could decline if one or more of these risks or uncertainties actually occur, causing you to lose all or part of your investment. This situation is changing rapidly and additional impacts may arise. Additional risks that we currently do not know about, or that we currently believe to be immaterial, may also impair our business. Certain statements below are forward-looking statements. See “Special Note Regarding Forward-Looking Statements” in this Quarterly Report.

Previous report

RISKS RELATED TO OUR BUSINESS

Previous report

The United States has enacted and continues to enact significant new tariffs, and President Trump has directed various federal agencies to further evaluate key aspects of U.S. trade policy. There has been and are ongoing discussions and commentaries regarding potential significant changes to U.S. trade policies, treaties and tariffs. There exists significant uncertainty about the future relationship between the U.S. and other countries with respect to such trade policies, treaties and tariffs. These developments, or the perception that any of them could occur, may have a material adverse effect on global and domestic economic conditions, whether or not there will be a recession, and the stability of global and domestic financial markets, and may significantly reduce global trade and, in particular, trade between the impacted nations and the U.S. These actions and policies may adversely affect the ability of the Company to fund our operations, affect our ability to develop products and work with partner companies and generally carry on our respective businesses. Although it is not yet possible to assess their impact, any of these factors could depress economic activity and restrict access to suppliers or customers, hinder our ability to obtain funding from the government through grants and from investors, and have a material adverse effect on our overall business, financial condition and results of operations.

Previous report

*If Nasdaq does not approve our plan for compliance with Nasdaq List Rule 5550(b)(1) following the April 7, 2025 notice that our stockholders' equity had fallen below the required $2,500,000, we may be delisted from the Nasdaq Capital Market exchange.

Previous report

On April 7, 2025, the Company received the Notice from the Listing Qualifications staff of Nasdaq notifying us that our stockholders equity as reported in our 2024 10-K, did not satisfy the continued listing requirements under Nasdaq Listing Rule 5550(b)(1) for the Nasdaq Capital Market (the "Nasdaq SE Rule"), which requires that a listed company’s stockholder equity be at least $2,500,000. In our 2024 10-K, we reported stockholders’ equity of $2,063,000, and, as a result, did not currently satisfy Nasdaq Listing Rule 5550(b)(1). While the Notice has no immediate effect on our Nasdaq listing, in order to regain compliance, we were required to present a our plan within 45 calendar days or by May 22, 2025 to Nasdaq staff and we did so. If our compliance plan is accepted, we may be granted up to 180 calendar days from April 7, 2025, to evidence compliance.

Previous report

We timely presented a plan for compliance within the requisite 45 days. Even though we did present a compliance plan within the prescribed deadline, Nasdaq staff may find it insufficient to evidence compliance with the Nasdaq SE Rule. If they do not find it sufficient, we may be delisted. If the Nasdaq staff do find our plan to sufficiently demonstrate compliance with the Nasdaq SE Rule, we may be granted up to 180 calendar days to implement the plan and regain compliance. Nasdaq may provide us insufficient time to implement our compliance plan or at the end of the compliance period, we may not be able to demonstrate compliance for any number of reasons. If any of these events occur, we could be delisted.

Previous report

OTHER RISKS RELATED TO OUR COMPANY

Previous report

*Artificial intelligence used by us and our partners and vendors may have negative effects on our company.

Previous report

Artificial intelligence ("AI") use in many industries has rapidly expanded. While we do not utilize any specific AI technologies internal to Alaunos, we may work with vendors or service providers that do utilize AI technologies with or without our knowledge. Areas in which our business that could be negatively impacted include novel cybersecurity threats such as malicious code or phishing attempts. AI could also perpetrate fraud or misappropriation of company funds. From a regulatory standpoint, we could be liable for noncompliance related to data compromise or perceived or actual noncompliance with data privacy or protection or AI requirements to various agencies or jurisdictions. There are also potential risks around ethical, social, and reputational risks should AI cause us to infringe on privacy rights or violate intellectual property rights. AI is also known for “deep fakes” or false information being spread electronically and attributed to innocent companies and their management or directors. Such accusations could negatively impact human rights, privacy, employment, or other social concerns, which may result in claims, lawsuits, brand or reputational harm, and increased regulatory scrutiny, any of which could harm our business, financial condition, and operating results. Operational risks potentially caused by AI technologies include unanticipated disruptions to systems, potential loss or corruption of data, implementation delays, and cost overruns that could stem from underlying defects in the AI tools used. Finally, competition risk may result from rapid adoption of AI that could provide unforeseen advantages to our competitors and lead to the erosion of our market share by potentially leading to the emergence of new products and categories, the rapid maturation of categories, cannibalization of categories, changing price points and product replacement and upgrade cycles.