# Lexeo Therapeutics, Inc. (LXEO) Informational only - not investment advice. CIK: 0001907108 SIC: 2836 Biological Products, (No Diagnostic Substances) SIC breadcrumb: [Manufacturing](/division/D/) > [Chemicals And Allied Products](/major-group/28/) > [SIC 2836 Biological Products, (No Diagnostic Substances)](/industry/2836/) Latest 10-K filed: 2026-03-30 SEC page: https://www.sec.gov/edgar/browse/?CIK=1907108 Filing source: https://www.sec.gov/Archives/edgar/data/1907108/000119312526132085/lxeo-20251231.htm ## Selected Fundamentals | Metric | Value | Unit | FY | Filed | | --- | ---: | --- | ---: | --- | | Net income | -99961000 | USD | 2025 | 2026-03-30 | | Assets | 268688000 | USD | 2025 | 2026-03-30 | ## Financials Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-30. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001907108.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts. | Metric | 2021 | 2022 | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | ---: | ---: | | Net income | | -59,277,000 | -66,394,000 | -98,333,000 | -99,961,000 | | Operating income | | -60,509,000 | -68,513,000 | -105,766,000 | -109,257,000 | | Diluted EPS | | -36.36 | -12.40 | -3.09 | -1.86 | | Operating cash flow | | -54,560,000 | -59,496,000 | -81,151,000 | -98,561,000 | | Capital expenditures | | 672,000 | 115,000 | 481,000 | 397,000 | | Assets | | 97,076,000 | 139,807,000 | 146,942,000 | 268,688,000 | | Liabilities | | 24,997,000 | 26,272,000 | 30,100,000 | 22,019,000 | | Stockholders' equity | -55,602,000 | -112,954,000 | 113,535,000 | 116,842,000 | 246,669,000 | | Cash and cash equivalents | 135,860,000 | 77,335,000 | 121,466,000 | 35,014,000 | 63,000,000 | | Free cash flow | | -55,232,000 | -59,611,000 | -81,632,000 | -98,958,000 | ### Ratios ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported. | Metric | 2021 | 2022 | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | ---: | ---: | | Return on equity | | | -58.48% | -84.16% | -40.52% | | Return on assets | | -61.06% | -47.49% | -66.92% | -37.20% | | Liabilities / equity | | | 0.23 | 0.26 | 0.09 | | Current ratio | | 5.58 | 7.21 | 5.52 | 11.21 | ## Quarterly Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-11. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001907108.json. Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived. | Quarter | End date | Revenue | Net income | Diluted EPS | Method | | --- | --- | ---: | ---: | ---: | --- | | 2023-Q3 | 2023-06-30 | | -13,441,000 | | reported discrete quarter | | 2023-Q3 | 2023-09-30 | | | -12.36 | reported discrete quarter | | 2023-Q4 | 2023-12-31 | | -14,187,000 | | derived Q4 = FY annual - nine-month YTD | | 2024-Q1 | 2024-03-31 | | -21,682,000 | -0.77 | reported discrete quarter | | 2024-Q2 | 2024-03-31 | | -21,682,000 | | reported discrete quarter | | 2024-Q2 | 2024-06-30 | | | -0.64 | reported discrete quarter | | 2024-Q3 | 2024-06-30 | | -21,238,000 | | reported discrete quarter | | 2024-Q3 | 2024-09-30 | | | -0.89 | reported discrete quarter | | 2024-Q4 | 2024-12-31 | | -25,924,000 | | derived Q4 = FY annual - nine-month YTD | | 2025-Q1 | 2025-03-31 | | -32,656,000 | -0.99 | reported discrete quarter | | 2025-Q2 | 2025-03-31 | | -32,656,000 | | reported discrete quarter | | 2025-Q2 | 2025-06-30 | | | -0.60 | reported discrete quarter | | 2025-Q3 | 2025-06-30 | | -26,103,000 | | reported discrete quarter | | 2025-Q3 | 2025-09-30 | | | -0.33 | reported discrete quarter | | 2025-Q4 | 2025-12-31 | | -20,919,000 | | derived Q4 = FY annual - nine-month YTD | | 2026-Q1 | 2026-03-31 | | -20,196,000 | -0.25 | reported discrete quarter | ## Macro Cross-References - [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average - [UNRATE](/indicator/UNRATE/): Unemployment Rate - [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate - [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private - [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit - [DFEDTARL](/indicator/DFEDTARL/): Federal Funds Target Range - Lower Limit - [DGS3MO](/indicator/DGS3MO/): Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity - [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity - [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity - [DGS30](/indicator/DGS30/): Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity - [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity - [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy - [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food - [CPIENGSL](/indicator/CPIENGSL/): Consumer Price Index for All Urban Consumers: Energy - [CUSR0000SAH1](/indicator/CUSR0000SAH1/): Consumer Price Index for All Urban Consumers: Shelter - [PCEPI](/indicator/PCEPI/): Personal Consumption Expenditures: Chain-type Price Index - [PCEPILFE](/indicator/PCEPILFE/): Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index - [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities - [T10YIE](/indicator/T10YIE/): 10-Year Breakeven Inflation Rate - [U6RATE](/indicator/U6RATE/): Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons - [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm - [CIVPART](/indicator/CIVPART/): Labor Force Participation Rate - [EMRATIO](/indicator/EMRATIO/): Employment-Population Ratio - [UNEMPLOY](/indicator/UNEMPLOY/): Unemployed - [CE16OV](/indicator/CE16OV/): Employment Level - [ICSA](/indicator/ICSA/): Initial Claims - [JTSJOL](/indicator/JTSJOL/): Job Openings: Total Nonfarm - [JTSQUR](/indicator/JTSQUR/): Quits: Total Nonfarm - [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product - [A191RL1Q225SBEA](/indicator/A191RL1Q225SBEA/): Real Gross Domestic Product: Percent Change from Preceding Period - [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index - [TCU](/indicator/TCU/): Capacity Utilization: Total Index - [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units - [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units - [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade - [PCE](/indicator/PCE/): Personal Consumption Expenditures - [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income - [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate - [M2SL](/indicator/M2SL/): M2 - [BOPGSTB](/indicator/BOPGSTB/): U.S. International Trade in Goods and Services: Balance - [MSPUS](/indicator/MSPUS/): Median Sales Price of Houses Sold for the United States - [HSN1F](/indicator/HSN1F/): New One Family Houses Sold: United States - [RHORUSQ156N](/indicator/RHORUSQ156N/): Homeownership Rate in the United States - [TTLCONS](/indicator/TTLCONS/): Total Construction Spending: Total Construction in the United States - [RRVRUSQ156N](/indicator/RRVRUSQ156N/): Rental Vacancy Rate in the United States - [TOTALSL](/indicator/TOTALSL/): Total Consumer Credit Owned and Securitized - [REVOLSL](/indicator/REVOLSL/): Revolving Consumer Credit Owned and Securitized - [DRCCLACBS](/indicator/DRCCLACBS/): Delinquency Rate on Credit Card Loans, All Commercial Banks - [GDP](/indicator/GDP/): Gross Domestic Product - [GPDI](/indicator/GPDI/): Gross Private Domestic Investment - [GCE](/indicator/GCE/): Government Consumption Expenditures and Gross Investment - [PCEC](/indicator/PCEC/): Personal Consumption Expenditures - [NETEXP](/indicator/NETEXP/): Net Exports of Goods and Services - [GFDEBTN](/indicator/GFDEBTN/): Federal Debt: Total Public Debt - [GFDEGDQ188S](/indicator/GFDEGDQ188S/): Federal Debt: Total Public Debt as Percent of Gross Domestic Product - [FYFSD](/indicator/FYFSD/): Federal Surplus or Deficit - [FGRECPT](/indicator/FGRECPT/): Federal Government Current Receipts - [FGEXPND](/indicator/FGEXPND/): Federal Government: Current Expenditures - [MANEMP](/indicator/MANEMP/): All Employees, Manufacturing - [USCONS](/indicator/USCONS/): All Employees, Construction - [USTRADE](/indicator/USTRADE/): All Employees, Retail Trade - [USFIRE](/indicator/USFIRE/): All Employees, Financial Activities - [USGOVT](/indicator/USGOVT/): All Employees, Government - [AWHAETP](/indicator/AWHAETP/): Average Weekly Hours of All Employees, Total Private - [DGORDER](/indicator/DGORDER/): Manufacturers' New Orders: Durable Goods - [NEWORDER](/indicator/NEWORDER/): Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft - [BUSINV](/indicator/BUSINV/): Total Business Inventories - [EXPGS](/indicator/EXPGS/): Exports of Goods and Services - [IMPGS](/indicator/IMPGS/): Imports of Goods and Services - [IR](/indicator/IR/): Import Price Index (End Use): All Commodities - [PPIFIS](/indicator/PPIFIS/): Producer Price Index by Commodity: Final Demand ## Latest quarter (10-Q) Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1907108/000119312526215678/lxeo-20260331.htm Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Confidence: high Filing date: 2026-05-11 Report date: 2026-03-31 Item 2. 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 together with our unaudited condensed financial statements and the related notes appearing elsewhere in this Quarterly Report on Form 10-Q. As a result of many factors, including those factors set forth in the “Risk Factors” section of this Quarterly Report on Form 10-Q, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. Please also see the section titled “Special Note Regarding Forward Looking Statements.” Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to “we,” “us” and “our” refer to Lexeo Therapeutics, Inc. Overview We are a clinical stage genetic medicine company dedicated to reshaping heart health by applying pioneering science to fundamentally change how cardiovascular diseases are treated. We are advancing a portfolio of therapeutic candidates that take aim at the underlying genetic causes of conditions, including Friedreich ataxia, or FA, cardiomyopathy, plakophilin-2, or PKP2, arrhythmogenic cardiomyopathy, or ACM, and other devastating diseases with high unmet need. LX2006 for the treatment of FA cardiomyopathy Our most advanced cardiovascular product candidate, LX2006 for the treatment of FA cardiomyopathy, is currently being evaluated in SUNRISE-FA, our ongoing Phase 1/2 clinical trial and in a Cornell investigator-initiated trial. Interim Clinical Data Updates In October 2025, we provided an interim clinical update, which included baseline characteristics and safety data from the 17 treated participants across the two studies, and clinical efficacy data from the 16 participants who had reached at least six months follow-up as of that time. A summary of key observations from the October 2025 interim update is set forth below. • Improvements in LVMI among participants with abnormal baseline LVMI (n=6). Five of six participants achieved 10% by 12-month visit or sooner and six of six participants achieved LVMI measurements within the normal range as of latest visit. An 18% mean improvement in LVMI was observed at 6-month visit and a 23% mean improvement in LVMI was observed at 12-month visit, exceeding 10% FDA-aligned threshold for pivotal study. In the mid- and high-dose cohorts (n=3), a 28% mean improvement in LVMI was observed at 6-month visit and a 33% mean improvement in LVMI was observed at 12-month visit, suggesting dose-dependent improvement. Among participants with normal baseline LVMI (n=10), the majority demonstrated LVMI improvement or stabilization over time. • Improvements in secondary cardiac biomarkers. Fourteen of sixteen participants achieved 25% reduction in high-sensitivity troponin I from baseline at latest visit. Fourteen of sixteen participants achieved reduction or stabilization in LWT from baseline at latest visit. • Improvements in mFARS as demonstrated by a 2.0-point mean improvement from baseline at latest visit across all participants. Eleven of sixteen participants achieved reduction or stabilization in mFARS from baseline at latest visit. • Previously reported data in April 2025 from ongoing SUNRISE-FA trial (n=8) showed that all study participants achieved increases in frataxin protein expression from baseline at 3-month visit, with dose-dependent increases observed across cohorts. In March 2026, we shared updated interim clinical data for LX2006 at the American College of Cardiology, or ACC, Annual Meeting. Phase 1/2 interim clinical data presented at the ACC Annual Meeting continue to show sustained or deepening improvements across both cardiac and neurologic measures of FA, including statistically significant improvement in mean mFARS scores for LX2006-treated participants compared to a propensity-matched control cohort from the UNIFAI natural history study. Treatment with LX2006 has been generally well tolerated with no Grade 3 treatment-related SAEs to date, no clinically significant complement activation, minimal, transient liver function test, or LFT, elevations, and no signs of frataxin over-expression observed in cardiac tissue. One previously disclosed, possibly treatment-related Grade 2 event of asymptomatic myocarditis observed one year after dosing. No participants discontinued from either study. Regulatory Alignment In February 2025, we announced further alignment on elements of the accelerated development pathway following a Type B Regenerative Medicine Advanced Therapy, or RMAT, meeting with the U.S. Food and Drug Administration, or FDA, including frataxin expression co-primary endpoint to be evaluated for any increase from baseline rather than numerical threshold. 22 In July 2025, we announced Breakthrough Therapy designation based on interim clinical data from Phase 1/2 trials showing clinically meaningful improvements in cardiac biomarkers and functional measures. We also announced that LX2006 was selected for the Chemistry, Manufacturing, and Controls Development and Readiness Pilot, or CDRP, Program, created to facilitate chemistry, manufacturing and controls, or CMC, registrational readiness and support faster patient access. In October 2025, in response to our questions regarding the possibility of a faster path to a Biologics License Application, or BLA, the FDA indicated openness to a BLA submission for accelerated approval that includes clinical data from the ongoing Phase 1/2 studies of LX2006 pooled with new clinical data to be generated in the planned pivotal study. The FDA also previously agreed to evaluate the co-primary endpoint of LVMI at a time point earlier than 12 months. Collectively, we believe this regulatory feedback has the potential to reduce the size and length of the planned pivotal study, possibly accelerating the overall timeline to BLA submission. We plan to initiate the LX2006 pivotal study in the second quarter of 2026, pending finalization of the trial protocol. In February 2026, we submitted the final registrational trial design and statistical analysis plan, or SAP, for the SUNRISE‑FA 2 pivotal study to the FDA following a Type B meeting. We are in contact with the FDA and are awaiting final feedback on the study protocol. We plan to provide an update when the protocol and SAP are finalized. LX2020 for the treatment of arrhythmogenic cardiomyopathy Our second most advanced cardiovascular product candidate, LX2020 for the treatment of ACM caused by mutations in the PKP2 gene, referred to as PKP2-ACM, is currently being evaluated in HEROIC-PKP2, an ongoing Phase 1/2 clinical trial. Interim Clinical Data Updates In January 2026, we provided an interim clinical data update, which included baseline characteristics and safety data from the ten participants dosed, including three participants in cohort 1 at the low dose and seven participants in cohorts 2 and 3 at the high dose. Clinical efficacy data were inclusive of those participants with at least 6 months of follow-up (n=8). A summary of key observations from the January 2026 interim update is set forth below. • Arrhythmia burden stabilized or improved in majority of participants with dose-dependent response in non-sustained ventricular tachycardia, or NSVT, and premature ventricular contractions, or PVCs. NSVT reduced or stabilized in the majority of participants, with a 22% mean improvement in high-dose cohorts at latest visit (n=5). PVCs reduced or stabilized in the majority of participants, with a 14% mean improvement in high-dose cohorts at latest visit. • Four of five participants in high-dose cohorts report improvement relative to baseline on the Patient Global Impression of Change, or PGIC, scale, a patient-reported outcome measure. • Participants stable across other clinical measures including QRS duration, T-wave inversion, right ventricular ejection fraction, or RVEF, and New York Heart Association, or NYHA, Class. • Increases in PKP2 protein expression versus baseline at three months in all participants that had undergone cardiac biopsies (n=7) assessed by western blot. Dose-dependent increases observed, with mean increase of 93% in the low-dose cohort (n=2) and 162% mean increase in the high-dose cohorts (n=5). Across all participants dosed, LX2020 has been generally well-tolerated to date with no clinically significant complement activation. Each of our gene therapy candidates utilizes the vector construct, dose and route of administration that we believe will result in the most favorable biodistribution and safety profile for our product candidate for each disease. Our most advanced programs use the AAVrh10 vector due to its high transduction efficiency in myocardial cells, potential for lower toxicity given the opportunity to utilize lower doses compared to other well-established AAV serotypes, and low pre-existing immunity. Current and Future Capital Requirements To date, we have funded our operations primarily through proceeds from the sale of shares of our convertible preferred stock, common stock, and pre-funded warrants and warrants to purchase our common stock. As of March 31, 2026, we had $227.6 million of cash, cash equivalents, and investments in U.S. Treasury securities. We have incurred significant operating losses since the commencement of our operations. Our ability to generate product revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of one or more of our current gene therapy candidates or any future gene therapy candidates. Our net losses for the three months ended March 31, 2026 and the year ended December 31, 2025 were $20.2 million and $100.0 million, respectively, and our accumulated deficit was $400.3 million at March 31, 2026. We expect to continue to incur significant losses for the foreseeable future as we advance our current and future product candidates through preclinical and clinical development, continue to build our operations and operate as a public company. 23 We expect to continue to incur net operating losses for at least the next several years, and we expect our research and development expenses, general and administrative expenses, and capital expenditures to continue to increase. We expect our expenses and capital requirements will increase significantly in connection with our ongoing activities as we: • continue our ongoing and planned clinical trials as well as research and development of our FA cardiomyopathy (LX2006) and arrhythmogenic cardiomyopathy caused by mutations in the PKP2 gene, or PKP2-ACM (LX2020) programs and other product candidates; • initiate preclinical studies and clinical trials for any additional product candidates that we may pursue in the future; • seek to discover and develop additional product candidates and further expand our clinical product pipeline; • seek regulatory approvals for any product candidates that successfully complete clinical trials; • invest in capital equipment in order to expand our research and development and manufacturing activities; • attract, hire and retain additional clinical, scientific, quality control, regulatory, and manufacturing management and administrative personnel; • add clinical, operational, financial and management information systems and personnel, including personnel to support our product development; • develop, maintain, expand, protect and enforce our intellectual property portfolio, including patents, trade secrets and know-how; • acquire or in-license other product candidates and technologies; • expand our operations in the United States and to other geographies; • incur additional legal, accounting, investor relations and other general and administrative expenses associated with operating as a public company; and • establish a sales, [Excerpt truncated for page length; source filing is linked above.] ## Latest 10-K MD&A Extracted from Item 7 to the first post-MD&A boundary after HTML sanitization. Confidence: high 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 together with the financial statements and related notes included elsewhere in this Annual Report on Form 10-K. This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed in “Item 1A. Risk Factors” and in other parts of this Annual Report on Form 10-K. Overview We are a clinical stage genetic medicine company dedicated to reshaping heart health by applying pioneering science to fundamentally change how cardiovascular diseases are treated. We are advancing a portfolio of therapeutic candidates that take aim at the underlying genetic causes of conditions, including FA cardiomyopathy, plakophilin-2, or PKP2, arrhythmogenic cardiomyopathy, or ACM, and other devastating diseases with high unmet need. LX2006 for the treatment of FA cardiomyopathy Our most advanced cardiovascular product candidate, LX2006 for the treatment of FA cardiomyopathy, is currently being evaluated in SUNRISE-FA, our ongoing Phase 1/2 clinical trial and in a Cornell investigator-initiated trial. Interim Clinical Data Updates In October 2025, we provided an interim clinical update, which included baseline characteristics and safety data from the 17 treated participants across the two studies, and clinical efficacy data from the 16 participants who had reached at least six months follow-up as of that time. A summary of key observations from the October 2025 interim update is set forth below. • Improvements in LVMI among participants with abnormal baseline LVMI (n=6). Five of six participants achieved 10% by 12-month visit or sooner and six of six participants achieved LVMI measurements within the normal range as of latest visit. A 18% mean improvement in LVMI was observed at 6-month visit and a 23% mean improvement in LVMI was observed at 12-month visit, exceeding 10% FDA-aligned threshold for pivotal study. In the mid- and high-dose cohorts (n=3), a 28% mean improvement in LVMI was observed at 6-month visit and a 33% mean improvement in LVMI was observed at 12-month visit, suggesting dose-dependent improvement. Among participants with normal baseline LVMI (n=10), the majority demonstrated LVMI improvement or stabilization over time. • Improvements in secondary cardiac biomarkers. Fourteen of sixteen participants achieved 25% reduction in high-sensitivity troponin I from baseline at latest visit. Fourteen of sixteen participants achieved reduction or stabilization in LWT from baseline at latest visit. • Improvements in mFARS as demonstrated by a 2.0-point mean improvement from baseline at latest visit across all participants. Eleven of sixteen participants achieved reduction or stabilization in mFARS from baseline at latest visit. • Previously reported data in April 2025 from ongoing SUNRISE-FA trial (n=8) showed that all study participants achieved increases in frataxin protein expression from baseline at 3-month visit, with dose-dependent increases observed across cohorts. Based on the data observed as of the October 2025 update, LX2006 remained generally well tolerated with no Grade 3+ SAEs and no signs of complement activation or other immunogenicity. Regulatory Alignment In February 2025, we announced further alignment on elements of the accelerated development pathway following a Type B RMAT meeting with the FDA including frataxin expression co-primary endpoint to be evaluated for any increase from baseline rather than numerical threshold. In July 2025, we announced Breakthrough Therapy designation based on interim clinical data from Phase 1/2 trials showing clinically meaningful improvements in cardiac biomarkers and functional measures. We also announced that LX2006 was selected for the CDRP Program, created to facilitate CMC registrational readiness and support faster patient access. 100 In October 2025, in response to our questions regarding the possibility of a faster path to BLA, the FDA indicated openness to a BLA submission for accelerated approval that includes clinical data from the ongoing Phase 1/2 studies of LX2006 pooled with new clinical data to be generated in the planned pivotal study. The FDA also previously agreed to evaluate the co-primary endpoint of LVMI at a time point earlier than 12 months. Collectively, we believe this regulatory feedback has the potential to reduce the size and length of the planned pivotal study, possibly accelerating the overall timeline to BLA submission. We plan to initiate the LX2006 pivotal study in the first half of 2026, pending finalization of the trial protocol. LX2020 for the treatment of arrhythmogenic cardiomyopathy Our second most advanced cardiovascular product candidate, LX2020 for the treatment of arrhythmogenic cardiomyopathy, or ACM, caused by mutations in the PKP2 gene, referred to as PKP2-ACM, is currently being evaluated in HEROIC-PKP2, an ongoing Phase 1/2 clinical trial. Interim Clinical Data Updates In October 2025, we provided an interim clinical data update for the three participants dosed in cohort 1 (n=2 at 12-month visit; n=1 at 9-month visit), assessing multiple cardiac parameters at latest visit relative to baseline. A summary of key observations from the October 2025 interim update is set forth below. • Premature ventricular contractions, or PVCs, were reduced in one of three participants and non-sustained ventricular tachycardia, or NSVT, was reduced or stable in two of three participants. • QRS duration was normalized or stable in two of three participants and T-wave inversions were reduced in two of three participants. • Left ventricular ejection fraction, or LVEF, and right ventricular ejection fraction, or RVEF, were stable in three of three participants. In January 2026, we provided an interim clinical data update, which included baseline characteristics and safety data from the ten participants dosed, including three participants in cohort 1 at the low dose and seven participants in cohorts 2 and 3 at the high dose. Clinical efficacy data were inclusive of those participants with at least 6 months of follow-up (n=8). A summary of key observations from the January 2026 interim update is set forth below. • Arrhythmia burden stabilized or improved in majority of participants with dose-dependent response in NSVT and PVCs. NSVT reduced or stabilized in the majority of participants, with a 22% mean improvement in high-dose cohorts at latest visit (n=5). PVCs reduced or stabilized in the majority of participants, with a 14% mean improvement in high-dose cohorts at latest visit. • Four of five participants in high-dose cohorts report improvement relative to baseline on the PGIC scale, a patient-reported outcome measure. • Participants stable across other clinical measures including QRS duration, T-wave inversion, RVEF and NYHA Class. • Increases in PKP2 protein expression versus baseline at three months in all participants that had undergone cardiac biopsies (n=7) assessed by western blot. Dose-dependent increases observed, with mean increase of 93% in the low-dose cohort (n=2) and 162% mean increase in the high-dose cohorts (n=5). Based on the data observed as of the October 2025 and January 2026 readouts, LX2020 remained generally well tolerated with no clinically significant complement activation. Each of our gene therapy candidates utilizes the vector construct, dose and route of administration that we believe will result in the most favorable biodistribution and safety profile for our product candidate for each disease. Our most advanced programs use the AAVrh10 vector due to its high transduction efficiency in myocardial cells, potential for lower toxicity given the opportunity to utilize lower doses compared to other well-established AAV serotypes, and low pre-existing immunity. Current and Future Capital Requirements To date, we have funded our operations primarily through proceeds from the sale of shares of our convertible preferred stock, common stock, and pre-funded warrants and warrants to purchase our common stock, including from our October 2025 Financing Transactions, May 2025 Private Placement, March 2024 Private Placement, IPO and the subsequent partial exercise of the underwriters’ 30-day option to purchase additional shares of common stock. As of December 31, 2025, we had $246.6 million of cash, cash equivalents, and investments in U.S. Treasury securities. We have incurred significant operating losses since the commencement of our operations. Our ability to generate product revenue sufficient to achieve profitability will depend heavily on the successful development and 101 eventual commercialization of one or more of our current gene therapy candidates or any future gene therapy candidates. Our net losses for the years ended December 31, 2025 and December 31, 2024 were $100.0 million and $98.3 million, respectively, and our accumulated deficit was $380.1 million at December 31, 2025. We expect to continue to incur significant losses for the foreseeable future as we advance our current and future product candidates through preclinical and clinical development, continue to build our operations and operate as a public company. We expect to continue to incur net operating losses for at least the next several years, and we expect our research and development expenses, general and administrative expenses, and capital expenditures to continue to increase. We expect our expenses and capital requirements will increase significantly in connection with our ongoing activities as we: • continue our ongoing and planned clinical trials as well as research and development of our FA cardiomyopathy (LX2006) and arrhythmogenic cardiomyopathy caused by mutations in the PKP2 gene, or PKP2-ACM (LX2020) programs and other product candidates; • initiate preclinical studies and clinical trials for any additional product candidates that we may pursue in the future; • seek to discover and develop additional product candidates and further expand our clinical product pipeline; • seek regulatory approvals for any product candidates that successfully complete clinical trials; • invest in capital equipment in order to expand our research and development and manufacturing activities; • attract, hire and retain additional clinical, scientific, quality control, regulatory, and manufacturing management and administrative personnel; • add clinical, operational, financial and management information systems and personnel, including personnel to support our product development; • develop, maintain, expand, protect and enforce our intellectual property portfolio, including patents, trade secrets and know-how; • acquire or in-license other product candidates and technologies; • expand our operations in the United States and to other geographies; • incur additional legal, accounting, investor relations and other general and administrative expenses associated with operating as a public company; and • establish a sales, marketing and distribution infrastructure, either ourselves or in partnership with others, to commercialize any product candidates, if approved, and related additional commercial manufacturing costs. Components of our results of operations Revenue To date, we have not generated any revenue from product sales. If our development efforts for LX2006 and LX2020, or any future product candidates, are successful and result in regulatory approval, or if we enter into collaboration or license agreements with third parties, we may generate revenue in the future from product sales, royalties or payments from such collaboration or license agreements, or a combination of product sales and payments from such agreements. Operating expenses Research and development Research and development expenses consist of costs incurred for our research activities, including our discovery efforts and the preclinical and clinical development of our programs. These expenses include: • employee-related expenses, including salaries, benefits, and stock-based compensation expense for employees engaged in research and development functions; 102 • expenses incurred under agreements with third parties, such as consultants, clinical investigators, contractors and CROs that assist with (i) identification of potential product candidates in discovery platforms and (ii) the preclinical and clinical studies of our product candidates; • the cost of developing and scaling our manufacturing process and manufacturing product candidates for use in our research, preclinical studies and clinical trials, including under agreements with third parties, such as consultants, contractors and CMOs; • costs to maintain compliance with FDA and other regulatory requirements; • laboratory supplies and research materials; • facilities, depreciation, and other expenses, which include direct and allocated expenses for rent and maintenance of facilities; • payments made under our licensing agreements with third parties, including milestone payments; and • other expenses incurred as a result of research and development activities. We record research and development costs as expenses when incurred. Nonrefundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity has been performed or when the goods have been received rather than when the payment is made. When third-party service providers’ billing terms do not coincide with our period-end, we are required to make estimates of our obligations to those third parties incurred in a given accounting period and record accruals at the end of the period. We base these estimates on our knowledge of the research and development programs, services performed for the period, past history for related activities and the expected duration of the third-party service contract, where applicable. If timelines or contracts are modified based upon changes in the scope of work to be performed, we modify our estimates of accrued expenses accordingly on a prospective basis; therefore, actual results could differ from our estimates. Upfront payments under license agreements are expensed upon receipt of the license, and annual maintenance fees under license agreements are expensed in the period in which they are incurred. Milestone payments under license agreements are accrued, with a corresponding expense being recognized, in the period in which the milestone is determined to be probable of achievement and the related amount is reasonably estimable. Our direct research and development expenses are tracked on a program-by-program basis and consist primarily of external costs, such as fees paid to CROs, CMOs, central laboratories and certain outside consultants in connection with our research and discovery, preclinical development, process development, manufacturing, clinical development, clinical trials, regulatory and quality assurance activities. We do not allocate professional services costs and licensing fees and other similar costs to specific programs because these costs are deployed across multiple programs. Research and development activities are central to our business model and account for a significant portion of our operating expenses. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. As a result, we expect our research and development expenses to increase for the foreseeable future as we further advance LX2006 and LX2020, and any other future product candidates that we may develop, into and through preclinical studies and clinical trials and pursue regulatory approvals. We cannot determine with certainty the timing of initiation, the duration or the completion costs of current or future preclinical studies and clinical trials of our product candidates due to the inherently unpredictable nature of preclinical and clinical development. Clinical and preclinical development timelines, the probability of success and development costs can differ materially from expectations. We anticipate that we will make determinations as to which product candidates to pursue and how much funding to direct to each product candidate on an ongoing basis in response to the results of ongoing and future research, preclinical studies and clinical trials, regulatory developments and our assessments as to each product candidate’s commercial potential. In addition, we cannot forecast whether any of our current or future product candidates will be subject to future collaborations, when such arrangements will be secured, if at all, and to what degree such arrangements would affect our development plans and capital requirements. We are also unable to predict when, if ever, we will generate revenue from our product candidates to offset our expenses. General and administrative General and administrative expenses consist primarily of personnel expenses, including salaries, benefits and stock-based compensation expense for personnel in executive, accounting, business development, legal, human resources and administrative functions. General and administrative expenses also include corporate facility costs not otherwise included in research and development expenses, depreciation, and other expenses, which include direct or allocated expenses for rent and maintenance of facilities and insurance, not otherwise included in research and development expenses, as well as professional fees for legal, consulting, investor and public relations, accounting and audit services. 103 We expect that in the near to medium term future our general and administrative expenses will decrease relative to those incurred during the year ended December 31, 2025 on an annualized basis, primarily due to lower anticipated third-party legal fees and related costs, while supporting the continued research and development of our programs and the growth of our business. Gain on long-term investment Gain on long-term investment includes non-operating income related to an unrealized gain on convertible preferred stock received that was recorded at fair value to long-term investment. Other income (expense), net Other income (expense), net includes foreign exchange gains and (losses). Interest expense Interest expense is primarily associated with our finance right of use asset equipment leases. Interest income Interest income is primarily related to interest earned from our investments in U.S. government money market funds and interest earned from our investments in U.S. Treasury securities, as well as interest earned on interest-bearing demand deposit cash accounts and a cash collateral account. (Amortization of premium) accretion of discount on investments in U.S. Treasury securities, net Amortization of premium and accretion of discount on investments consists of amortization of premium and accretion of discount on our investments in U.S. Treasury securities. Income taxes Provision for income taxes consists of U.S. federal and state income taxes in the jurisdictions where we conduct business. Since our inception, we have not recorded any income tax benefits for the net losses we have incurred in each year or for our research and development tax credits, as we believe, based upon the weight of available evidence, that it is more likely than not that all of our net operating loss, or NOL, carryforwards and tax credits will not be realized. Accordingly, we have recorded a full valuation allowance against our net deferred tax assets at December 31, 2025 and December 31, 2024. As of December 31, 2025 and December 31, 2024 we had no unrecognized tax benefits. 104 Results of operations Comparison of the Years Ended December 31, 2025 and 2024 The following table summarizes our results of operations for the years ended December 31, 2025 and 2024 (in thousands): Years Ended December 31, 2025 2024 Change Operating expenses Research and development $ 63,797 $ 74,091 $ (10,294 ) General and administrative 45,460 31,675 13,785 Total operating expenses 109,257 105,766 3,491 Operating loss (109,257 ) (105,766 ) (3,491 ) Other income and expense Gain on long-term investment 3,390 - 3,390 Other expense, net (18 ) (9 ) (9 ) Interest expense (95 ) (137 ) 42 Interest income 6,130 7,556 (1,426 ) (Amortization of premium) accretion of discount on investments in U.S. Treasury securities, net (111 ) 23 (134 ) Total other income and expense 9,296 7,433 1,863 Loss from operations before income taxes (99,961 ) (98,333 ) (1,628 ) Income taxes - - - Net Loss $ (99,961 ) $ (98,333 ) $ (1,628 ) Research and development expenses The following table summarizes our research and development expenses incurred for the years ended December 31, 2025 and 2024 (in thousands): Years Ended December 31, 2025 2024 Change Direct external research and development expenses by program: LX2006 $ 18,163 $ 14,256 $ 3,907 LX2020 15,413 23,451 (8,038 ) LX1001 1,168 4,501 (3,333 ) Other programs 2,075 3,424 (1,349 ) Total direct external research and development expenses by program 36,819 45,632 (8,813 ) Unallocated research and development expenses: Employee and stock-based compensation expenses 20,707 22,011 (1,304 ) Lab-related costs and supplies 1,550 1,367 183 Professional fees 1,701 2,030 (329 ) Other unallocated costs, including facilities 3,020 3,051 (31 ) Total unallocated research and development expenses: 26,978 28,459 (1,481 ) Total research and development expenses $ 63,797 $ 74,091 $ (10,294 ) The net decrease of $10.3 million in total research and development expenses for the year ended December 31, 2025 compared to the year ended December 31, 2024 was primarily due to decreases in (i) milestone expenses of $6.1 million, consisting primarily of a $6.0 million development milestone for our LX2020 program that was achieved during the third quarter of 2024 and subsequently paid to the selling shareholders of Stelios, (ii) clinical trial costs of $3.2 million excluding an adjustment that reduced estimated accrued clinical trial expenses in 2024 by $2.2 million for our LX1001 program, (iii) employee and stock-based compensation costs of $1.3 million primarily due to decreased headcount, (iv) CMC expenses of $1.2 million, and (v) license fees of $0.6 million related to the Third Cornell License Agreement that were incurred in 2024. These decreases were partially offset by an adjustment that reduced estimated accrued clinical trial expenses in 2024 by $2.2 million for our LX1001 program. 105 General and administrative expenses The net increase of $13.8 million in general and administrative expenses for the year ended December 31, 2025 compared to the year ended December 31, 2024 was primarily due to increases in third-party legal fees and associated costs of $11.7 million, as well as employee compensation costs of $1.9 million primarily due to increased headcount. Gain on long-term investment We recorded non-operating income of approximately $3.4 million during the year ended December 31, 2025 related to an unrealized gain on convertible preferred stock received that was recorded at fair value to long-term investment. Interest income We recognized interest income of $6.1 million and $7.6 million for the years ended December 31, 2025 and December 31, 2024, respectively, primarily related to interest earned on our investments in U.S. government money market funds and our investments in U.S Treasury securities, with the decrease primarily due to lower interest rates. Liquidity and capital resources Sources of liquidity Since our inception, we have not generated any revenue from product sales and have incurred significant operating losses and negative cash flows from our operations. We expect to incur significant expenses and operating losses for the foreseeable future as we advance the clinical development of our product candidates. Since our inception through December 31, 2025, we funded our operations primarily through proceeds from the sale of shares of our convertible preferred stock, common stock, and pre-funded warrants and warrants to purchase our common stock, including from our October 2025 Financing Transactions, May 2025 Private Placement, March 2024 Private Placement, IPO and the subsequent partial exercise of the underwriters’ 30-day option to purchase additional shares of common stock, with estimated net proceeds since our inception totaling $594.9 million. As of December 31, 2025 and December 31, 2024, we had cash, cash equivalents, and investments in U.S. Treasury Securities of $246.6 million and $128.5 million, respectively. On March 24, 2025 we filed a prospectus supplement to the prospectus which forms a part of our effective shelf registration statement on Form S-3, dated December 13, 2024, which registers the offering, issuance, and sale of up to $75.0 million of common stock pursuant to our ATM Program. As of December 31, 2025, we have not sold any shares of common stock pursuant to the ATM Program. In October 2025, we raised $153.8 million in equity capital from the October 2025 Financing Transactions, receiving net proceeds of $143.9 million after transaction costs. We believe that our cash, cash equivalents, and investments in U.S. Treasury securities balances will be sufficient to fund our planned operating expenses and capital expenditure requirements into 2028. Our total future capital requirements will depend on many factors and are subject to the risks and uncertainties set forth in “Item 1A Risk Factors.” Cash flows The following table summarizes our sources and uses of cash for the years ended December 31, 2025 and December 31, 2024 (in thousands): Years Ended December 31, 2025 2024 Net cash used in operating activities $ (98,561 ) $ (81,151 ) Net cash used in investing activities (90,252 ) (94,077 ) Net cash provided by financing activities 216,795 88,776 Net increase (decrease) in cash $ 27,982 $ (86,452 ) Operating activities During the year ended December 31, 2025, net cash used in operating activities consisted primarily of our net loss of $100.0 million, which included an unrealized gain of $3.4 million recorded to other non-operating income upon receipt of our long-term investment in convertible preferred stock, in addition to $9.5 million of net cash used in changes in operating assets and liabilities, which were partially offset by $12.1 million of stock-based compensation expense and $2.1 million of depreciation expense and amortization of operating and finance right-of-use assets. 106 During the year ended December 31, 2024, net cash used in operating activities consisted primarily of our net loss of $98.3 million, which was partially offset by (i) $12.5 million of stock-based compensation expense, (ii) $2.7 million of net cash provided by changes in operating assets and liabilities, and (iii) $2.0 million of depreciation expense and amortization of operating and finance right-of-use assets. Investing activities During year ended December 31, 2025, net cash used in investing activities was $90.3 million and consisted primarily of purchases of investments in U.S. Treasury securities of $195.4 million, which was partially offset by proceeds from sales or maturities of investments in U.S. Treasury securities of $105.5 million and purchases of lab equipment of $0.4 million. During the year ended December 31, 2024, net cash used in investing activities was $94.1 million and consisted primarily of the purchase of investments in U.S. Treasury securities and lab equipment. Financing activities During the year ended December 31, 2025, net cash provided by financing activities consisted primarily of the net proceeds received from the October 2025 Financing Transactions of $143.9 million, the May 2025 Private Placement of $73.1 million, as well as proceeds received from common stock issuances under the 2023 ESPP (as defined below) of $0.3 million and proceeds received from the exercise of stock options of $0.1 million, which were partially offset by $0.5 million of principal payments made on equipment finance leases. During the year ended December 31, 2024, net cash provided by financing activities consisted primarily of the net proceeds received from the March 2024 Private Placement of $88.7 million, as well as $0.5 million of proceeds received from the exercise of stock options, which were partially offset by $0.4 million of principal payments made on equipment finance leases. We expect our expenses and capital requirements to increase significantly in connection with our ongoing activities, particularly as we advance our lead product candidates and other development programs. Accordingly, we will continue to require substantial additional funding to support our continuing operations. The timing and amount of our future operating and capital requirements will largely depend on many factors, including: • the initiation, scope, progress, timing, results and costs of product discovery, preclinical studies and clinical trials for our product candidates or any future candidates we may develop; • our ability to maintain our relationships with Cornell University, Adverum, The Regents of UCSD, and any other key licensors or collaborators; • the scope, prioritization and number of our research and development programs; • the costs, timing and outcome of seeking and obtaining regulatory approvals from the FDA and comparable foreign regulatory authorities, including the potential for such authorities to require that we perform more preclinical studies or clinical trials than those that we currently expect or change their requirements on studies that had previously been agreed to; • our ability to establish and maintain collaborations on favorable terms, if at all; • the achievement of milestones or occurrence of other developments that trigger payments under any collaboration agreements we have or may enter into; • the extent to which we are obligated to reimburse, or entitled to reimbursement of, clinical trial costs under collaboration agreements, if any; • the costs to establish, maintain, expand, enforce and defend the scope of our intellectual property portfolio, including preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending intellectual property-related claims; • the extent to which we acquire or in-license other product candidates and technologies; • the costs of securing manufacturing arrangements for commercial production; 107 • the costs of establishing or contracting for sales and marketing capabilities if we obtain regulatory approvals to market our product candidates; and • our need to implement additional internal systems and infrastructure. We may be unable to raise additional funds or enter into potential collaborations, strategic partnerships or marketing, distribution, licensing or other similar agreements or arrangements on favorable terms, or at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, your stockholder ownership interest will be diluted. If we fail to raise capital or enter into such agreements or arrangements as, and when, needed, we may have to significantly delay, scale back or discontinue the development or commercialization of our product candidates or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves. Critical accounting policies and significant judgments and estimates Our management’s discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP. The preparation of our financial statements and related disclosures requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, expenses, and the disclosure of our contingent liabilities in our financial statements. We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions. While our significant accounting policies are described in more detail in Note 2 to our audited financial statements included elsewhere in this Annual Report, we believe that the following accounting policies are those most critical to the judgments and estimates used in the preparation of our audited financial statements. Research and development As part of the process of preparing our financial statements, we are required to estimate our accrued research and development expenses. This process involves 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 actual costs. The majority of our service providers invoice us in arrears for services performed on a pre-determined schedule or when contractual milestones are met; however, some require advance payments. We make estimates of our accrued expenses as of each balance sheet date in the financial statements based on facts and circumstances known to us at that time. At each period end, we corroborate the accuracy of these estimates with the service providers and make adjustments, if necessary. Examples of estimated accrued research and development expenses include those related to fees paid to: • vendors in connection with discovery and preclinical development activities; • CROs in connection with preclinical studies and testing; and • CMOs in connection with the process development and scale up activities and the production of materials. We record the expense and accrual related to contract research and manufacturing based on our estimates of the services received and efforts expended considering a number of factors, including our knowledge of the progress towards completion of the research, development, and manufacturing activities; invoicing to date under contracts; communication from the CROs, CMOs, and other companies of any actual costs incurred during the period that have not yet been invoiced; and the costs included in the contracts and purchase orders. The financial terms of these agreements are subject to negotiation, vary from contract to contract, and may result in uneven payment flows. There may be instances in which payments made to our vendors will exceed the level of services provided and result in a prepayment of the expense. In accruing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, we adjust the accrual or the amount of prepaid expense accordingly. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in reporting amounts that are too high or too low in any particular period. To date, there have not been any material adjustments to our prior estimates of accrued research and development expenses; however, we cannot guarantee that such adjustments will not be made in the future. 108 Stock option awards We recognize share-based compensation expense related to stock option awards granted based on the estimated fair value of the awards on the date of grant using a Black-Scholes option pricing model. The grant date fair value of the share-based awards is recognized on an accelerated basis under the graded vesting method over the requisite service period of the award, which is the vesting period of the respective awards. Share-based payments to non-employees issued in exchange for services are based upon the fair value of the equity instruments issued. Compensation expense for stock options issued to non-employees is calculated using the Black-Scholes option pricing model and is recorded over the requisite service performance period. The Black-Scholes option-pricing model requires the use of highly subjective assumptions, which are used to determine the fair value stock option awards granted. These assumptions include: Expected Term. The expected term represents the period that our stock option awards granted are expected to be outstanding and is determined using the simplified method (based on the mid-point between the vesting date and the end of the contractual term). Expected Volatility. The expected stock price volatility is primarily based on the historical volatility of a publicly traded set of peer companies for stock options granted since the IPO, each for a period equal to the expected life of the stock options granted, and we expect to continue to do so until such time as we have adequate historical data regarding the volatility of our own traded stock price. Our peer group of publicly traded companies was chosen based on their similar size, stage in the life cycle or area of specialty. Risk-Free Interest Rate. The risk-free interest rate is based on the interest rates paid on securities issued by the U.S. Treasury with a term approximating the expected life of stock options granted. Expected Dividend. We have never paid, and do not anticipate paying, cash dividends on our shares of common stock. Therefore, the expected dividend yield was assumed to be zero. Fair Value of Common Stock. The fair value of shares of our common stock is measured by the stock price on the date of grant. Emerging growth company and smaller reporting company status The JOBS Act permits an “emerging growth company” such as us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies until those standards would otherwise apply to private companies. We have elected not to “opt out” of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we will adopt the new or revised standard at the time private companies adopt the new or revised standard and will do so until such time that we either (i) irrevocably elect to “opt out” of such extended transition period or (ii) no longer qualify as an emerging growth company. There are other exemptions and reduced reporting requirements provided by the JOBS Act that we are currently evaluating. For example, as an “emerging growth company,” we are exempt from Sections 14A(a) and (b) of the Exchange Act, which would otherwise require us to (1) submit certain executive compensation matters to shareholder advisory votes, such as “say-on-pay,” “say-on-frequency,” and “golden parachutes;” and (2) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of our chief executive officer’s compensation to our median employee compensation. We also rely on an exemption from the rule requiring us to provide an auditor’s attestation report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act. We will continue to remain an “emerging growth company” until the earliest of the following: (1) the last day of the fiscal year following the fifth anniversary of the date of the completion of our IPO; (2) the last day of the fiscal year in which our total annual gross revenue is equal to or more than $1.235 billion; (3) the date on which we have issued more than $1.0 billion in nonconvertible debt during the previous three years; or (4) the date on which we are deemed to be a large accelerated filer under the rules of the SEC. We are also a “smaller reporting company,” meaning that the market value of our stock held by non-affiliates was less than $700.0 million as of June 30, 2025 and our annual revenue was less than $100.0 million during the most recently completed fiscal year. We may continue to be a smaller reporting company if either (1) the market value of our stock held by non-affiliates is less than $250.0 million or (2) our annual revenue is less than $100.0 million during the most recently completed fiscal year and the market value of our stock held by non-affiliates is less than $700.0 million as of June 30 of such year. If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company we may choose to present only the two most recent fiscal years of audited consolidated financial statements in our Annual Report on Form 10-K and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation. 109 Recently issued accounting pronouncements A description of recently issued accounting pronouncements that may potentially impact our financial position, results of operations and cash flows is disclosed in Note 2 to our audited financial statements included elsewhere in this Annual Report. Qualitative and quantitative disclosures about market risk Interest rate risk We are a smaller reporting company, as defined by Rule 12b-2 under the Exchange Act and are not required to provide the information under this item.