Financial Performance - Keros Therapeutics reported a quarterly loss of $0.18 per share, significantly better than the Zacks Consensus Estimate of a loss of $1.11, representing an earnings surprise of +83.78% [1] - The company posted revenues of $14.26 million for the quarter ended September 2025, exceeding the Zacks Consensus Estimate by 86.04%, compared to revenues of $0.39 million in the same quarter last year [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$1.11 on revenues of $7.67 million, while for the current fiscal year, the estimate is $0.33 on revenues of $235.61 million [7] - The estimate revisions trend for Keros Therapeutics was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - Keros Therapeutics operates within the Zacks Medical - Biomedical and Genetics industry, which is currently ranked in the top 40% of over 250 Zacks industries, suggesting a favorable industry outlook [8] - The performance of Keros Therapeutics' stock may be influenced by the overall industry outlook, as the top 50% of Zacks-ranked industries tend to outperform the bottom 50% by more than 2 to 1 [8]

Financial Performance - The company reported a net loss of $7.3 million for the three months ended September 30, 2025, and a net income of $110.5 million for the nine months ended September 30, 2025, primarily driven by revenue from the license agreement with Takeda [111]. - Total revenue for the three months ended September 30, 2025, was $14.3 million, a significant increase from $388,000 in the same period in 2024, primarily due to the Takeda Agreement [142]. - Total revenue for the nine months ended September 30, 2025, was $243.7 million, a significant increase from $0.5 million in the same period of 2024, primarily driven by $205.4 million in license revenue from the Takeda Agreement [150]. - Net income for the nine months ended September 30, 2025, was $110.5 million, compared to a net loss of $141.3 million in the same period of 2024, marking a turnaround in financial performance [156]. - The company recognized $10.0 million in license revenue related to a development milestone under the Takeda Agreement for the three months ended September 30, 2025 [143]. - The income tax benefit for the three months ended September 30, 2025, was $1.4 million, attributed to taxable income generated from the Takeda Agreement [148]. - The company incurred an income tax provision of $6.4 million for the nine months ended September 30, 2025, attributed to taxable income from the Takeda Agreement [155]. Cash and Cash Equivalents - As of September 30, 2025, the company had an accumulated deficit of $458.3 million and cash and cash equivalents of $693.5 million [111]. - Cash and cash equivalents as of September 30, 2025, were $693.5 million, with expectations to fund operations into the first half of 2028 after accounting for planned repurchases [162]. - As of September 30, 2025, cash and cash equivalents totaled $693.5 million, up from $559.9 million as of December 31, 2024 [178]. Research and Development - The company is developing KER-065 for the treatment of Duchenne muscular dystrophy, with a Phase 2 clinical trial expected to start in Q1 2026 [104]. - The company expects research and development expenses to continue to fluctuate based on clinical trial activities and anticipates a decrease in elritercept-related expenses once transitioned to Takeda [135]. - The company expects to continue incurring substantial expenses related to ongoing research and development activities, particularly for clinical trials [157]. - Research and development expenses decreased to $19.5 million for the three months ended September 30, 2025, from $49.2 million in 2024, a reduction of $29.7 million [145]. - Research and development expenses decreased to $111.7 million for the nine months ended September 30, 2025, down from $128.0 million in 2024, reflecting a reduction in expenses related to KER-065 and cibotercept [152]. - The company has not generated any revenue from product sales as none of its product candidates have been approved for commercialization [106]. - The company has not yet approved any products for sale and does not anticipate generating revenue from product sales until successful development and regulatory approval [158]. Agreements and Payments - The company entered into a license agreement with Takeda Pharmaceuticals in December 2024, receiving a $200 million upfront payment and a $10 million milestone payment upon dosing the first patient in the Phase 3 RENEW clinical trial [120]. - The company is entitled to receive up to $1.1 billion in potential milestone payments from Takeda based on the achievement of specified development and commercial milestones [120]. - The company received a net upfront payment of $18.0 million in January 2022 under the Hansoh Agreement, with potential additional payments of up to $23.5 million for development milestones and $144.0 million for net sales thresholds [125]. - The company recognized $0.1 million in service revenue related to the Hansoh Agreement for the three months ended September 30, 2025, compared to $0.4 million in 2024 [143]. - The company plans to distribute 25% of any net cash proceeds received from the Takeda license agreement to stockholders by December 31, 2028 [115]. Stock and Financing Activities - The company has sold a total of 4,290,096 shares under the ATM Offering for aggregate net proceeds of approximately $228.6 million as of September 30, 2025 [109]. - The company initiated a stock repurchase plan, repurchasing 10,176,595 shares at a price of $17.75 per share for an aggregate purchase price of $180.6 million [113]. - Net cash provided by financing activities was $316.3 million for the nine months ended September 30, 2024, primarily from a public offering of common stock and an ATM program [171]. Other Income and Expenses - Total other income, net was $6.7 million for the three months ended September 30, 2025, an increase of $1.0 million from $5.7 million in 2024, driven by higher dividend income [146]. - Total other income, net increased to $20.0 million for the nine months ended September 30, 2025, from $16.3 million in 2024, driven by a rise in dividend income [154]. - General and administrative expenses increased to $10.1 million for the three months ended September 30, 2025, compared to $9.8 million in 2024, reflecting a net increase in professional fees and other costs [146]. - General and administrative expenses increased to $35.1 million for the nine months ended September 30, 2025, from $30.1 million in 2024, primarily due to higher professional fees [153]. Cash Flow and Investments - Net cash provided by operating activities was $134.8 million for the nine months ended September 30, 2025, driven by net income and non-cash charges [165]. - Cash used in investing activities was $1.4 million for the nine months ended September 30, 2025, and $1.6 million for the nine months ended September 30, 2024, due to purchases of property and equipment [169]. - The company experienced a $5.0 million cash outflow in prepaid expenses and other assets due to timing of expense recognition for research and development costs [168]. Risk and Accounting Policies - The company had no debt outstanding subject to interest rate variability as of September 30, 2025, mitigating interest rate risk related to debt [179]. - The company is exposed to market risks primarily due to interest rate sensitivities, but does not expect significant effects from changes in market interest rates [178]. - There have been no significant changes to critical accounting policies from those described in the Annual Report [175].

Core Insights - Keros Therapeutics reported a significant reduction in net loss for Q3 2025, amounting to $7.3 million compared to a net loss of $53.0 million in Q3 2024, primarily due to revenue from a license agreement with Takeda Pharmaceuticals [2][10]. - The company is advancing its clinical pipeline, with plans for a Phase 3 trial of elritercept in myelodysplastic syndromes and a Phase 2 trial of KER-065 for Duchenne muscular dystrophy [2][6]. Financial Performance - Total revenue for Q3 2025 was $14.3 million, a substantial increase from $388,000 in Q3 2024, driven by $10 million in license revenue from Takeda [10]. - Research and development expenses decreased to $19.5 million in Q3 2025 from $49.2 million in Q3 2024, largely due to the transition of elritercept-related expenses to Takeda [3][10]. - General and administrative expenses rose slightly to $10.1 million in Q3 2025 from $9.8 million in Q3 2024, attributed to increased external expenses despite a reduction in compensation costs [4][10]. Cash Position - As of September 30, 2025, Keros had cash and cash equivalents of $693.5 million, up from $559.9 million at the end of 2024, which is expected to fund operations into the first half of 2028 after accounting for $375 million earmarked for stockholder returns [5][12]. Product Development - Keros is focused on developing therapeutics targeting disorders linked to dysfunctional signaling of the TGF-ß protein family, with KER-065 aimed at neuromuscular diseases and elritercept targeting cytopenias in myelodysplastic syndromes [6][10].

Core Insights - Keros Therapeutics, Inc. (KROS) shares increased by 9.8% to $15.19, following a significant trading volume, contrasting with an 11.1% decline over the past month [1][2] Company Overview - The stock price rise is linked to investor optimism regarding Keros' pipeline candidate KER-065, aimed at treating neuromuscular disorders, particularly Duchenne muscular dystrophy in a phase I study [2] - Keros' most advanced product, elritercept, is being developed in collaboration with Takeda to address cytopenias, including anemia and thrombocytopenia, in patients with myelodysplastic syndrome and myelofibrosis [2] Financial Expectations - Keros is projected to report a quarterly loss of $1.11 per share, reflecting a year-over-year increase of 21.3%, while revenues are anticipated to reach $7.67 million, a substantial rise of 1865.6% compared to the same quarter last year [3] - The consensus EPS estimate for Keros has remained stable over the last 30 days, indicating that stock price movements may not sustain without earnings estimate revisions [4] Industry Context - Keros Therapeutics operates within the Zacks Medical - Biomedical and Genetics industry, where another company, Illumina (ILMN), also experienced a stock price increase of 4.2% to $99.5, despite a -7.1% return over the past month [4] - Illumina's consensus EPS estimate for its upcoming report has increased by 0.7% to $1.17, representing a 2.6% change from the previous year [5]

Group 1 - Keros Therapeutics (KROS) shares rose by 2.1% in early trading on Monday [1] - The company announced a stock buyback offer of up to $194.4 million [1] - This buyback is part of a broader $375 million capital return plan [1]

Core Points - Keros Therapeutics, Inc. has initiated a cash tender offer to repurchase up to $194.4 million of its common stock at a price of $17.75 per share as part of a $375 million capital return program [1] - The tender offer is set to expire on November 18, 2025, unless extended or terminated earlier [2] - Keros plans to fund the tender offer using its existing cash and cash equivalents [1] Company Overview - Keros Therapeutics is a clinical-stage biopharmaceutical company focused on developing novel therapeutics for disorders linked to dysfunctional signaling of the TGF-ß protein family [6] - The company is recognized for its understanding of TGF-ß proteins, which regulate the growth and maintenance of various tissues [6] - Keros' lead product candidate, KER-065, targets neuromuscular diseases, particularly Duchenne muscular dystrophy, while its advanced candidate, elritercept, is aimed at treating cytopenias in myelodysplastic syndrome and myelofibrosis patients [6]

[Introduction and Recitals](index=1&type=section&id=Introduction%20and%20Recitals) This section introduces the Stock Purchase Agreement, detailing parties, purpose, share repurchase, and board resignations [Agreement Overview](index=1&type=section&id=Agreement%20Overview) This Stock Purchase Agreement, effective October 15, 2025, is between Keros Therapeutics, Inc. (the "Company") and the Seller Affiliates listed on Schedule I. It outlines the terms for the Company to repurchase shares from the Seller Affiliates as part of its Capital Return Program - The agreement is dated **October 15, 2025**, and is between **Keros Therapeutics, Inc.** and the **Seller Affiliates**[2](index=2&type=chunk) - The Company previously disclosed its intention to return **$375 million** in excess capital to stockholders as part of the **Capital Return Program**[4](index=4&type=chunk) [Background and Purpose](index=1&type=section&id=Background%20and%20Purpose) The Seller Affiliates collectively own 4,787,331 shares of the Company's common stock. As part of the Capital Return Program, the Company will purchase these shares from the Seller Affiliates. Concurrently, the Board Designees (Mr. Tomer Kariv and Mr. Ran Nussbaum) have delivered irrevocable resignation letters from the Company's Board of Directors, effective on the agreement's effective date - As of the agreement date, **Seller Affiliates** beneficially own **4,787,331 shares** of the Company's **Common Stock**[4](index=4&type=chunk) - The Company intends to purchase shares from **Seller Affiliates** as part of its **Capital Return Program**[4](index=4&type=chunk) - **Board Designees** (**Mr. Tomer Kariv** and **Mr. Ran Nussbaum**) have delivered irrevocable resignation letters from the **Board of Directors**, effective as of the **Effective Date**[4](index=4&type=chunk)[54](index=54&type=chunk) [SECTION 1: PURCHASE AND SALE OF THE SHARES; THE CLOSING](index=1&type=section&id=SECTION%201%3A%20PURCHASE%20AND%20SALE%20OF%20THE%20SHARES%3B%20THE%20CLOSING) This section details the purchase and sale of Common Stock, specifying price, closing procedures, and mutual assurances for completion [1.1 Purchase and Sale of Common Stock](index=1&type=section&id=1.1%20Purchase%20and%20Sale%20of%20Common%20Stock) The Seller Affiliates agree to sell, and the Company agrees to purchase, an aggregate number of Common Stock shares from each Seller Affiliate as specified in Schedule I, subject to the terms and conditions of this Agreement - **Seller Affiliates** agree to sell, and the Company agrees to purchase, shares of **Common Stock** as specified in **Schedule I**[6](index=6&type=chunk) [1.2 Purchase Price](index=1&type=section&id=1.2%20Purchase%20Price) The per share purchase price for the Common Stock is set at $17.75. The total purchase price for each Seller Affiliate will be calculated by multiplying this per share price by the number of shares sold by that affiliate | Metric | Value | | :----- | :---- | | Per Share Purchase Price | **$17.75** | [1.3 The Closing Process](index=2&type=section&id=1.3%20The%20Closing%20Process) The closing of the share purchase and sale will occur on the settlement date. Upon execution of the agreement, each Seller Affiliate will transfer shares to the Company's transfer agent. Promptly after confirmation of transfer, the Company will wire the applicable Purchase Price to each Seller Affiliate - Closing will take place on the settlement date of the transactions[9](index=9&type=chunk) - **Seller Affiliates** will transfer shares to **Computershare Trust Company, N.A.** for the Company's benefit[10](index=10&type=chunk) - Within **one business day** of transfer confirmation, the Company will deliver the **Purchase Price** to **Seller Affiliates** via wire transfer[11](index=11&type=chunk) [1.4 Further Assurances](index=2&type=section&id=1.4%20Further%20Assurances) Both parties agree to cooperate and use commercially reasonable efforts to execute additional documents and take necessary actions to consummate the Closing promptly in accordance with the agreement - Parties will cooperate and use commercially reasonable efforts to execute additional documents and actions to consummate the Closing[12](index=12&type=chunk) [SECTION 2: REPRESENTATIONS AND WARRANTIES OF SELLER AFFILIATES](index=2&type=section&id=SECTION%202%3A%20REPRESENTATIONS%20AND%20WARRANTIES%20OF%20SELLER%20AFFILIATES) This section outlines Seller Affiliates' representations regarding share ownership, authorization to sell, and assurances of no violations or required consents [2.1 Ownership of Shares](index=2&type=section&id=2.1%20Ownership%20of%20Shares) Each Seller Affiliate represents that they beneficially own the shares listed on Schedule I with full voting rights. Immediately after closing, they will not have voting rights or beneficial ownership of Company capital stock (excluding Board Designees' equity awards) and the shares sold will be free of liens, claims, or encumbrances - Each **Seller Affiliate** beneficially owns shares listed on **Schedule I** with full voting rights[15](index=15&type=chunk) - Immediately upon Closing, **Seller Affiliates** will not have voting rights or beneficial ownership of Company capital stock (excluding **Board Designees**' equity awards)[15](index=15&type=chunk) - Shares sold to the Company will be free and clear of any liens, claims, or encumbrances[15](index=15&type=chunk) [2.2 Authorization](index=2&type=section&id=2.2%20Authorization) Each Seller Affiliate warrants that they have the full right, power, and authority to execute, deliver, and perform this Agreement and to sell their shares to the Company. The Agreement constitutes a legal, valid, and binding obligation for each Seller Affiliate - Each **Seller Affiliate** has full right, power, and authority to execute, deliver, and perform this Agreement and sell their shares[16](index=16&type=chunk) - This Agreement is a legal, valid, and binding obligation of each **Seller Affiliate**[16](index=16&type=chunk) [2.3 No Violation; No Consent](index=3&type=section&id=2.3%20No%20Violation%3B%20No%20Consent) The execution and performance of this Agreement by Seller Affiliates will not breach any existing judgment or agreement, create any lien on the shares, or require consent from any Governmental Authority (other than customary SEC/Nasdaq filings) - Execution and performance by **Seller Affiliates** will not breach any judgment or agreement, create liens, or require governmental consent (except **SEC**/Nasdaq filings)[17](index=17&type=chunk) [SECTION 3: REPRESENTATIONS AND WARRANTIES OF THE COMPANY](index=3&type=section&id=SECTION%203%3A%20REPRESENTATIONS%20AND%20WARRANTIES%20OF%20THE%20COMPANY) This section details the Company's representations regarding corporate power, authorization to acquire shares, funds, and legal compliance [3.1 Organization and Corporate Power; Authorization](index=3&type=section&id=3.1%20Organization%20and%20Corporate%20Power%3B%20Authorization) The Company represents that it is a duly incorporated Delaware corporation with the requisite power and authority to execute and perform this Agreement and acquire the Shares. It also confirms having sufficient cash to purchase the Shares and that the Agreement is a duly authorized, legal, valid, and binding obligation of the Company - The Company is a duly incorporated **Delaware** corporation with the power and authority to execute and perform this Agreement[19](index=19&type=chunk) - The Company has sufficient cash in immediately available funds to purchase the Shares[19](index=19&type=chunk) - This Agreement is a legal, valid, and binding obligation of the Company[19](index=19&type=chunk) [3.2 No Violation; No Consent](index=3&type=section&id=3.2%20No%20Violation%3B%20No%20Consent) The Company warrants that the execution and performance of this Agreement will not breach any existing judgment or agreement, create any lien on the shares, or require consent from any Governmental Authority (other than customary SEC/Nasdaq filings) - Execution and performance by the Company will not breach any judgment or agreement, create liens, or require governmental consent (except **SEC**/Nasdaq filings)[20](index=20&type=chunk) [SECTION 4: COVENANTS](index=3&type=section&id=SECTION%204%3A%20COVENANTS) This section establishes covenants including tax withholding, standstill, voting commitments, non-disparagement, public announcements, affiliate compliance, and no-litigation [4.1 Withholding](index=3&type=section&id=4.1%20Withholding) The Purchase Price paid to each Seller Affiliate will be subject to any applicable U.S. federal, state, local, or foreign income, backup withholding, or other withholding taxes - The **Purchase Price** is subject to applicable U.S. federal, state, local, or foreign income, backup withholding, or other withholding taxes[22](index=22&type=chunk) [4.2 Standstill Agreement](index=4&type=section&id=4.2%20Standstill%20Agreement) During the Standstill Period (until the final certification of voting results for the 2028 Annual Meeting), Seller Affiliates and their Affiliates/Associates are prohibited from various actions without Company consent. These include acquiring more than 100,000 shares, engaging in proxy solicitations against the Board, proposing changes to the Company's management or structure, calling special meetings, forming groups, short selling, or challenging the agreement's validity. Exceptions are made for private communications with the Board, compliance with law, or participating in transactions on the same basis as other stockholders - The **Standstill Period** commences on the **Effective Date** and ends immediately following the final certification of voting results for the **2028 Annual Meeting of Stockholders**[24](index=24&type=chunk) - **Seller Affiliates** are prohibited from acquiring beneficial ownership of more than **100,000 shares** of **Common Stock**[24](index=24&type=chunk) - **Seller Affiliates** are restricted from engaging in proxy solicitations, proposing changes to the **Board** or Company policies, calling special meetings, forming groups, or engaging in short sales related to Company securities[24](index=24&type=chunk)[25](index=25&type=chunk)[26](index=26&type=chunk) [4.3 Voting Commitment](index=6&type=section&id=4.3%20Voting%20Commitment) During the Standstill Period, Seller Affiliates commit to vote all beneficially owned shares (i) in favor of Board nominees, (ii) against non-Board approved director nominations, (iii) against proposals to remove directors, and (iv) in accordance with Board recommendations on other proposals. Exceptions allow voting with ISS/Glass Lewis recommendations for non-director matters and sole discretion for Extraordinary Transactions - During the **Standstill Period**, **Seller Affiliates** must vote all beneficially owned shares in favor of **Board nominees** and against non-Board approved director nominations or removal proposals[28](index=28&type=chunk) - **Seller Affiliates** must vote in accordance with **Board** recommendations on other proposals, with an exception if **ISS** and **Glass Lewis** make a differing recommendation (for non-director matters)[28](index=28&type=chunk) - **Seller Affiliates** have sole discretion to vote on any **Extraordinary Transaction**[28](index=28&type=chunk) [4.4 Mutual Non-Disparagement](index=7&type=section&id=4.4%20Mutual%20Non-Disparagement) During the Standstill Period, neither the Company nor the Seller Affiliates shall make any public or private statements that criticize, disparage, defame, or slander the other party, its subsidiaries, business, or current/former directors, officers, or employees. Exceptions apply for legally compelled disclosures or reporting federal law violations - During the **Standstill Period**, neither party shall make public or private statements that criticize, disparage, defame, or slander the other party or its associated individuals/entities[30](index=30&type=chunk) - Exceptions include compelled testimony, legally required disclosures, or private communications between parties[31](index=31&type=chunk) [4.5 Public Announcements and Filings](index=7&type=section&id=4.5%20Public%20Announcements%20and%20Filings) On the Effective Date, the Company will issue a press release (Exhibit A). Within one business day, the Company will file a Form 8-K with the SEC, and within two business days, the Seller Affiliates will file an amendment to their Schedule 13D. Both parties will have the opportunity to review and comment on each other's SEC filings - On the **Effective Date**, the Company will issue a press release (**Exhibit A**)[32](index=32&type=chunk) - Within **one business day** of the **Effective Date**, the Company will file a **Form 8-K** with the **SEC**[33](index=33&type=chunk) - Within **two business days** of the **Effective Date**, the **Seller Affiliates** will file an amendment to their **Schedule 13D**[35](index=35&type=chunk) [4.6 Affiliates and Associates Compliance](index=8&type=section&id=4.6%20Affiliates%20and%20Associates%20Compliance) Each Seller Affiliate agrees to ensure their respective Affiliates and Associates comply with the terms of this Agreement and will be jointly and severally responsible for any breaches by them - Each **Seller Affiliate** will cause its **Affiliates** and **Associates** to comply with the Agreement's terms[37](index=37&type=chunk) - **Seller Affiliates** are jointly and severally responsible for any breaches by their respective **Affiliates** and **Associates**[37](index=37&type=chunk) [4.7 No Litigation](index=8&type=section&id=4.7%20No%20Litigation) During the Standstill Period, neither the Company nor the Seller Affiliates shall initiate, solicit, join, or assist in any lawsuit or proceeding against the other party or their directors/officers. Exceptions include legal proceedings to enforce this Agreement, counterclaims, or responding to legal requirements (with prompt notice to the other party) - During the **Standstill Period**, neither party shall initiate or assist in any lawsuit against the other, their **Affiliates**, or their directors/officers[38](index=38&type=chunk) - Exceptions include legal proceedings to remedy a breach of this Agreement, counterclaims, or responding to legal requirements[38](index=38&type=chunk) [SECTION 5: MISCELLANEOUS](index=9&type=section&id=SECTION%205%3A%20MISCELLANEOUS) This section covers miscellaneous provisions: survival, adjustments, assignment, termination, notices, governing law, amendments, and definitions [5.1 Survival](index=9&type=section&id=5.1%20Survival) All representations, warranties, and covenants made under this Agreement will survive the Closing of the transactions - All representations, warranties, and covenants survive the Closing[41](index=41&type=chunk) [5.2 Adjustments](index=9&type=section&id=5.2%20Adjustments) Any specified numbers, such as shares or price per share, will be adjusted to reflect stock dividends, stock-splits, reverse stock-splits, combinations, or other reclassifications to preserve the original rights and obligations of the Parties - Numbers of shares or price per share will be adjusted for stock dividends, splits, or reclassifications to preserve original rights and obligations[42](index=42&type=chunk) [5.3 Successors and Assigns; No Third-Party Beneficiaries](index=9&type=section&id=5.3%20Successors%20and%20Assigns%3B%20No%20Third-Party%20Beneficiaries) The Agreement's provisions benefit and bind the successors and permitted assigns of the Parties. No Party may assign the Agreement without prior written consent from the other Parties. No third-party beneficiaries are intended - Provisions benefit and bind successors and permitted assigns; no assignment without prior written consent[43](index=43&type=chunk) - No provision is intended to confer rights or benefits upon any person other than the Parties and their successors/assigns[43](index=43&type=chunk) [5.4 Entire Agreement](index=9&type=section&id=5.4%20Entire%20Agreement) This Agreement constitutes the entire understanding between the Parties regarding its subject matter, superseding all prior agreements and communications. The Letter Agreement dated April 17, 2025, automatically terminates upon execution of this Agreement - This Agreement contains all terms agreed upon and supersedes all prior agreements, arrangements, and communications[44](index=44&type=chunk) - The letter agreement dated **April 17, 2025**, automatically terminates upon execution of this Agreement[44](index=44&type=chunk) [5.5 Termination](index=9&type=section&id=5.5%20Termination) This Agreement will terminate at the earlier of the end of the Standstill Period or the consummation of an Extraordinary Transaction, with the provisions of Section 5 surviving such termination. No liability for breaches occurring after termination, except for prior breaches - The Agreement terminates at the earlier of the end of the **Standstill Period** or the consummation of an **Extraordinary Transaction**[45](index=45&type=chunk) - Provisions of **Section 5** survive termination[45](index=45&type=chunk) [5.6 Notices](index=10&type=section&id=5.6%20Notices) Notices, consents, and other communications must be in writing and are deemed delivered upon receipt (personally or by email) or one business day after deposit with an overnight delivery service. Specific addresses and email contacts are provided for both the Seller Affiliates and the Company - Notices must be in writing and delivered personally, by email, or via overnight delivery service[47](index=47&type=chunk) - Specific contact information for **Seller Affiliates** (Pontifax entities) and the Company (**Keros Therapeutics, Inc.**) is provided[47](index=47&type=chunk) [5.7 Severability](index=11&type=section&id=5.7%20Severability) If any provision of this Agreement is found to be invalid, illegal, or unenforceable by a court, the validity, legality, and enforceability of the remaining provisions will not be affected - If any provision is judicially determined to be invalid, illegal, or unenforceable, the remaining provisions' validity, legality, and enforceability will not be affected[47](index=47&type=chunk) [5.8 Governing Law; Jurisdiction](index=11&type=section&id=5.8%20Governing%20Law%3B%20Jurisdiction) This Agreement is governed by and construed in accordance with the laws of the State of Delaware. The Parties agree that jurisdiction for any related legal proceedings will exclusively lie in the Delaware Court of Chancery or other specified Delaware courts, and they irrevocably waive any objection to venue and submit to personal jurisdiction. Both Parties also irrevocably waive any right to trial by jury - The Agreement is governed by and construed in accordance with the laws of the **State of Delaware**[48](index=48&type=chunk) - Jurisdiction for any legal proceedings will exclusively lie in the **Court of Chancery of the State of Delaware** or other specified **Delaware** courts[48](index=48&type=chunk) - Each Party irrevocably waives any and all right to **trial by jury** in any legal proceeding arising out of or related to this Agreement[48](index=48&type=chunk) [5.9 Amendment; Waiver](index=11&type=section&id=5.9%20Amendment%3B%20Waiver) This Agreement can only be modified, amended, or changed by a written document signed by all Parties. Rights under the Agreement can only be waived in writing signed by the waiving Parties. No failure or delay in exercising a right constitutes a waiver - This Agreement may only be modified, amended, or changed in a writing signed by all Parties[49](index=49&type=chunk) - Rights under this Agreement may be waived only in a writing signed by each of the Parties waiving such right[49](index=49&type=chunk) [5.10 Specific Performance](index=11&type=section&id=5.10%20Specific%20Performance) The Parties acknowledge that irreparable damage would result from any breach of this Agreement and are entitled to injunctions to prevent or cure breaches and to specifically enforce its terms, in addition to other remedies. Any defense that damages would be adequate is waived - Parties agree that irreparable damage would occur from breaches and are entitled to injunctions to prevent or cure breaches and to enforce terms specifically[50](index=50&type=chunk) - Any defense that a remedy in damages would be adequate is expressly waived[50](index=50&type=chunk) [5.11 Payment of Fees and Expenses](index=11&type=section&id=5.11%20Payment%20of%20Fees%20and%20Expenses) Each Party is responsible for its own fees and expenses related to the Agreement. However, the Company will reimburse the Seller Affiliates for their reasonable and documented out-of-pocket fees and expenses, including legal fees, incurred from the date of the Letter Agreement through this Agreement's execution, up to a mutually agreed aggregate amount - Each Party is responsible for its own fees, costs, and expenses[51](index=51&type=chunk) - The Company will reimburse **Seller Affiliates** for reasonable and documented out-of-pocket fees and expenses (including legal fees) incurred from the Letter Agreement date through this Agreement's execution, up to a mutually agreed amount[51](index=51&type=chunk) [5.12 Interpretation and Construction of Agreement](index=11&type=section&id=5.12%20Interpretation%20and%20Construction%20of%20Agreement) This section outlines rules for interpreting the Agreement, stating that all Parties were represented by counsel and participated in drafting, thus waiving any rule of law that would construe ambiguities against a drafting party. It also defines common terms and phrases used throughout the document - All Parties were represented by counsel and participated in drafting, waiving rules of construction against a drafting party[52](index=52&type=chunk) - Defines terms like 'including' (without limitation), 'hereof' (referring to the whole Agreement), and 'will' (same meaning as 'shall')[52](index=52&type=chunk) [5.13 Counterparts](index=12&type=section&id=5.13%20Counterparts) This Agreement may be executed in any number of counterparts, each considered an original, which together constitute one instrument. Delivery by facsimile, electronic mail, or other transmission method is deemed valid - The Agreement may be executed in any number of counterparts, each an original, together constituting one instrument[53](index=53&type=chunk) - Delivery by facsimile, electronic mail, or other transmission method is deemed duly and validly delivered[53](index=53&type=chunk) [5.14 Certain Definitions](index=12&type=section&id=5.14%20Certain%20Definitions) This section provides definitions for key capitalized terms used throughout the Agreement, including 'Affiliate,' 'Associate,' 'Board Designees' (Mr. Tomer Kariv and Mr. Ran Nussbaum), 'Business Day,' 'Extraordinary Transaction,' 'Governmental Authority,' 'person,' 'Representatives,' 'Short Interests,' 'Stockholder Meeting,' and 'Synthetic Equity Interests.' - Defines '**Affiliate**' and '**Associate**' as per **Rule 12b-2 of the Exchange Act**, with specific provisos[54](index=54&type=chunk) - Identifies '**Board Designees**' as **Mr. Tomer Kariv** and **Mr. Ran Nussbaum**[54](index=54&type=chunk) - Defines '**Extraordinary Transaction**' as a transaction with a third party resulting in pre-transaction stockholders not controlling a majority of the surviving entity's voting power, or the sale of substantially all Company assets[54](index=54&type=chunk) [Schedules and Exhibits](index=16&type=section&id=Schedules%20and%20Exhibits) This section lists supporting schedules and exhibits, detailing share information, wire instructions, and the public press release form [Schedule I: Shares Owned and Sold](index=16&type=section&id=Schedule%20I%3A%20Shares%20Owned%20and%20Sold) Schedule I details the number of Common Stock shares owned by each Seller Affiliate and the corresponding number of shares being sold to Keros Therapeutics, Inc. as part of this agreement | Name of Seller Affiliate | Number of Shares of Common Stock Owned | Number of Shares of Common Stock Sold | | :----------------------- | :------------------------------------- | :------------------------------------ | | **Pontifax (Israel) IV, L.P.** | **2,284,612** | **2,284,612** | | **Pontifax (Cayman) IV L.P.** | **1,121,045** | **1,121,045** | | **Pontifax (China) IV L.P.** | **1,226,412** | **1,226,412** | | **Pontifax Late Stage Fund, L.P.** | **155,262** | **155,262** | [Schedule II: Wire Instructions](index=17&type=section&id=Schedule%20II%3A%20Wire%20Instructions) Schedule II contains the wire instructions for the payment of the Purchase Price to the Seller Affiliates - **Schedule II** contains the wire instructions for payment[62](index=62&type=chunk) [Exhibit A: Form of Press Release](index=18&type=section&id=Exhibit%20A%3A%20Form%20of%20Press%20Release) Exhibit A provides the agreed-upon form of the press release to be issued by the Company on the Effective Date regarding this Agreement and the contemplated transactions - **Exhibit A** is the Form of Press Release[63](index=63&type=chunk)

Core Points - Keros Therapeutics has entered into agreements to repurchase all shares held by ADAR1 Capital Management and Pontifax Venture Capital for approximately $181 million at a price of $17.75 per share, as part of a $375 million capital return program [1][4] - The company plans to commence a tender offer to repurchase up to $194 million of additional shares at the same price of $17.75 per share, expected to start by the end of October 2025 [3][4] - Keros intends to distribute 25% of any net cash proceeds from its global license agreement with Takeda Pharmaceuticals to stockholders by December 31, 2028 [2] Financial Details - The total purchase price for the repurchase of shares from ADAR1 and Pontifax is approximately $181 million, funded from existing cash and cash equivalents [1] - The planned tender offer will also be funded from the company's existing cash and cash equivalents [3] Management and Strategic Outlook - The capital return program reflects Keros' confidence in its outlook and the prospects for its key clinical program, KER-065, which is targeted for a Phase 2 clinical trial in patients with Duchenne muscular dystrophy in Q1 2026 [4] - The negotiation and approval of the repurchase transactions were overseen by a Capital Return Committee composed entirely of independent directors, ensuring a focus on enhancing long-term stockholder value [4]

Group 1 - Keros Therapeutics, Inc. (NASDAQ: KROS) shares are trading at a small discount to cash after the company abandoned its cibotercept program, leaving it with one wholly owned asset [2] - The company has faced challenges in 2025, impacting its overall performance and strategic direction [2] Group 2 - The Biotech Forum offers a model portfolio featuring 12-20 high upside biotech stocks, along with live chat discussions on trade ideas and weekly market commentary [2]

Core Insights - Keros Therapeutics, Inc. presented additional clinical data from its Phase 1 trial of KER-065, highlighting its potential in treating Duchenne muscular dystrophy (DMD) and bone disorders [1][2] Company Overview - Keros Therapeutics is a clinical-stage biopharmaceutical company focused on developing novel therapeutics targeting disorders linked to dysfunctional signaling of the TGF-ß protein family [8] - The company is developing KER-065, a modified activin receptor ligand trap, aimed at increasing skeletal muscle regeneration and bone strength, with an initial focus on DMD [4][8] Clinical Trial Details - The Phase 1 trial was a randomized, double-blind, placebo-controlled study assessing the safety, tolerability, and pharmacokinetics of KER-065 in healthy male volunteers [2] - Initial topline data from the trial was reported in March 2025, with the final data cut-off on April 29, 2025 [3][6] Safety and Tolerability - KER-065 was generally well-tolerated across all tested dose levels, with no dose-limiting toxicities or serious adverse events reported [3] - One grade 4 treatment-emergent adverse event was noted but was deemed unrelated to the treatment [3] Efficacy Results - Treatment with KER-065 resulted in significant changes in bone biomarkers, indicating increased bone formation and reduced resorption [6] - Improvements in whole body bone mineral density (BMD) were observed at Day 85 and sustained through Day 141, suggesting a favorable balance between osteoblast and osteoclast activity [6] Disease Context - Duchenne muscular dystrophy (DMD) is characterized by muscle degeneration and is caused by a lack of functional dystrophin protein, leading to muscle cell damage and replacement with fibrotic and fatty tissue [5][7] - DMD affects approximately one in every 3,500 male births worldwide, with heart complications being a leading cause of death in affected individuals [7]