Presentation Details: SANTA ANA, Calif., June 03, 2024 (GLOBE NEWSWIRE) -- NKGen Biotech, Inc. (Nasdaq: NKGN) ("NKGen" or the "Company"), a clinical-stage biotechnology company focused on the development and commercialization of innovative autologous, allogeneic and CAR-NK natural killer ("NK") cell therapeutics, today announced that Paul Y. Song, MD, Chairman and Chief Executive Officer of NKGen Biotech, will present details on their cryopreserved allogeneic NK cell therapy platform as well as updated Phas ...

SNK02 has the potential to be a first-in-class cryopreserved allogeneic NK cell therapy for solid tumors that does not require lymphodepletion before administration, which may lead to better overall synergy in future combination regimens with immune checkpoint inhibitors. In this Phase 1 trial, the best objective response of stable disease was demonstrated in 100% of patients that completed 8 treatment cycles of SNK02. SNK02 was well tolerated as a monotherapy and appears to have some clinical activity agai ...

[Special Note Regarding Forward-Looking Statements](index=2&type=section&id=SPECIAL%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section outlines forward-looking statements, which are based on current expectations but involve significant risks and uncertainties that could cause actual results to differ materially - This section outlines forward-looking statements, which are based on current expectations but involve significant risks and uncertainties that could cause actual results to differ materially[7](index=7&type=chunk)[8](index=8&type=chunk) - Key risk factors include the Company's ability to raise future financing, service operations and expenses, continue as a going concern, recognize benefits from the Business Combination, maintain Nasdaq listing, commercialize product candidates, and the timing/results of clinical trials and regulatory approvals[9](index=9&type=chunk)[14](index=14&type=chunk) - The Company does not undertake any obligation to update forward-looking statements, and investors are cautioned not to unduly rely on them due to inherent uncertainties[11](index=11&type=chunk)[13](index=13&type=chunk) [PART I. FINANCIAL INFORMATION](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This part presents the company's unaudited financial statements and management's discussion and analysis of its financial condition and results of operations [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents the unaudited condensed consolidated financial statements for NKGen Biotech, Inc., including the balance sheets, statements of operations and comprehensive loss, statements of stockholders' deficit, and statements of cash flows, along with detailed notes explaining the company's financial position, performance, and significant accounting policies [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and stockholders' deficit at specific points in time | Metric (in thousands USD) | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Total assets | $16,316 | $16,481 | | Total liabilities | $71,371 | $75,174 | | Total stockholders' deficit | $(55,055) | $(58,693) | - Total assets decreased slightly by **$165 thousand**, while total liabilities decreased by **$3,803 thousand**, leading to a reduction in the stockholders' deficit by **$3,638 thousand**[20](index=20&type=chunk) - Current liabilities decreased from **$39,452 thousand** to **$37,483 thousand**, primarily due to a reduction in forward purchase derivative liabilities from **$15,804 thousand** to **$10,085 thousand**[20](index=20&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) This section details the company's financial performance over specific periods, outlining revenues, expenses, and net loss | Metric (in thousands USD) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Research and development expenses | $3,236 | $3,599 | | General and administrative expenses | $4,385 | $3,199 | | Total expenses | $7,621 | $6,798 | | Loss from operations | $(7,621) | $(6,798) | | Interest expense | $(1,069) | $(34) | | Change in fair value of derivative warrant liabilities | $3,716 | $0 | | Net loss and comprehensive loss | $(5,382) | $(8,322) | | Net loss per share, basic and diluted | $(0.25) | $(0.63) | - Net loss decreased by **35%** from **$(8,322) thousand** in Q1 2023 to **$(5,382) thousand** in Q1 2024[22](index=22&type=chunk) - General and administrative expenses increased by **37% YoY**, while research and development expenses decreased by **10% YoY**[22](index=22&type=chunk) [Condensed Consolidated Statements of Stockholders' Deficit](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Deficit) This section tracks changes in the equity section of the balance sheet, reflecting capital contributions, net losses, and other equity adjustments | Metric (in thousands USD) | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Common stock | $2 | $2 | | Additional paid-in capital | $122,844 | $121,727 | | Subscription receivable | $(10,389) | $(17,792) | | Accumulated deficit | $(167,512) | $(162,130) | | Total stockholders' deficit | $(55,055) | $(58,693) | - Total stockholders' deficit improved from **$(58,693) thousand** to **$(55,055) thousand**, primarily due to a decrease in subscription receivable and an increase in additional paid-in capital[24](index=24&type=chunk) - Stock-based compensation contributed **$1,117 thousand** to additional paid-in capital in Q1 2024[24](index=24&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section reports the cash generated and used by the company across its operating, investing, and financing activities | Metric (in thousands USD) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Net cash used in operating activities | $(4,034) | $(4,914) | | Net cash provided by (used in) investing activities | $35 | $(13) | | Net cash provided by financing activities | $4,007 | $5,558 | | Net increase in cash, cash equivalents, and restricted cash | $8 | $631 | | Cash, cash equivalents, and restricted cash at end of period | $284 | $748 | - Net cash used in operating activities decreased by **$0.9 million** YoY, from **$(4,914) thousand** to **$(4,034) thousand**[26](index=26&type=chunk) - Financing activities provided **$4,007 thousand** in Q1 2024, primarily from amendments to FPA agreements, issuance of convertible bridge loans, and promissory notes[26](index=26&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and additional information supporting the condensed consolidated financial statements, including significant accounting policies and specific transaction details [1. Company Information](index=12&type=section&id=1.%20Company%20Information) This note provides background on NKGen Biotech, Inc., its business, formation, and financial viability concerns - NKGen Biotech, Inc. is a clinical-stage biotechnology company developing autologous, allogeneic, and CAR-NK cell therapies using its proprietary SNK platform[29](index=29&type=chunk) - The company was formed through a business combination on September 29, 2023, with its common stock and warrants trading on Nasdaq under 'NKGN' and 'NKGNW'[31](index=31&type=chunk) - As of March 31, 2024, the Company had an accumulated deficit of **$167.5 million** and cash and cash equivalents of less than **$0.1 million**, raising substantial doubt about its ability to continue as a going concern[34](index=34&type=chunk) [2. Summary of Significant Accounting Policies](index=14&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the key accounting principles and methods used in preparing the financial statements, including those related to the Business Combination and estimates - The Business Combination was accounted for as a common control transaction and reverse recapitalization, with financial statements representing a continuation of Legacy NKGen[36](index=36&type=chunk) - Significant estimates include accrued clinical and R&D expenses, various convertible notes, derivative liabilities, and equity awards[42](index=42&type=chunk) - The Company is an 'Emerging Growth Company' and has elected to use the extended transition period for complying with new or revised financial accounting standards[64](index=64&type=chunk)[65](index=65&type=chunk) [3. Reverse Recapitalization](index=20&type=section&id=3.%20Reverse%20Recapitalization) This note details the accounting treatment and financial impact of the Business Combination, which was structured as a reverse recapitalization - The Business Combination on September 29, 2023, was treated as a reverse recapitalization, converting Legacy NKGen's equity into the Company's equity and assuming Graf's net assets[67](index=67&type=chunk)[69](index=69&type=chunk) Total Company Common Stock Outstanding Immediately Following Business Combination | Source | Shares | | :------------------------------------------------ | :------- | | Graf public shares, net of redemptions | 93,962 | | Private placement investors' shares | 3,683,010| | Graf founder shares | 2,516,744| | Conversion of Legacy NKGen convertible promissory notes | 2,278,598| | Legacy NKGen rollover shares | 13,316,662| | **Total** | **21,888,976**| Net Equity Impact of the Business Combination (in thousands USD) | Item | Amount | | :------------------------------------------------ | :------- | | Closing proceeds (issuance of common stock, PIPE warrants, senior convertible promissory notes) | $21,877 | | Less: Closing disbursements (underwriter fees, transaction costs) | $(12,216) | | Less: Noncash activity (conversion of legacy notes, assumed liabilities) | $(10,085) | | Less: Liability-classified instruments (fair value of warrants, derivatives, notes) | $(42,163) | | **Net equity impact** | **$(23,876)**| [4. Private Placement](index=23&type=section&id=4.%20Private%20Placement) This note describes the private placement agreements, including share purchases, escrow arrangements, and the financial impact of subsequent amendments - Private Placement Agreements involved FPA Investors purchasing **3,168,121 FPA Shares** for **$32.9 million**, deposited into escrow, with funds released based on VWAP and other factors[73](index=73&type=chunk)[74](index=74&type=chunk) - Amendments in December 2023 and January/February 2024 led to losses on amendment of **$0.4 million** and **$0.4 million**, respectively, primarily due to reductions in the subscription receivable and changes to Reset Price and Prepayment Shortfall terms[85](index=85&type=chunk)[89](index=89&type=chunk) Reconciliation of Subscription Receivable and Forward Purchase Derivative Liabilities (in thousands USD) | Item | Subscription Receivables | Forward Purchase Derivative Liabilities | | :------------------------------------------ | :----------------------- | :-------------------------------------- | | Balance at December 31, 2023 | $17,792 | $15,804 | | Amendment of forward purchase contracts | $(2,764) | $(1,418) | | Change in fair value of forward purchase derivative liabilities | $0 | $(535) | | Sales and settlement of forward purchase contracts | $(4,639) | $(3,766) | | **Ending balance at March 31, 2024** | **$10,389** | **$10,085** | [5. Warrants](index=26&type=section&id=5.%20Warrants) This note details the various types of warrants outstanding, their classification, exercise prices, and the financial impact of related amendments - As of March 31, 2024, various warrants remained outstanding, including Public Warrants (equity classified, **$11.50** exercise price), Private Warrants (liability classified, **$11.50** exercise price), SPA Warrants (equity classified, **$11.50** exercise price), and Working Capital Warrants (liability classified, **$11.50** exercise price)[94](index=94&type=chunk)[95](index=95&type=chunk)[96](index=96&type=chunk)[97](index=97&type=chunk)[98](index=98&type=chunk) - PIPE Warrants (liability classified) were purchased for **$10.2 million**, with varying exercise prices and downside protection provisions[99](index=99&type=chunk) - A PIPE Warrant Amendment in February 2024 granted exchange rights and 'Most Favored Nation' status, resulting in a **$0.7 million** gain for the Company from cash proceeds and reduction in derivative liability[100](index=100&type=chunk)[101](index=101&type=chunk) [6. Convertible Notes](index=29&type=section&id=6.%20Convertible%20Notes) This note outlines the various convertible notes issued, their conversion terms, interest rates, and associated financial instruments - Legacy Convertible Notes totaling **$17.3 million** were converted into **2,278,598 shares** of common stock at the Business Combination closing[104](index=104&type=chunk)[105](index=105&type=chunk) - Senior Convertible Notes of **$10.0 million** were issued to NKMAX with a **5.0% cash** or **8.0% paid-in-kind** interest rate, convertible at **$10.00 per share**[106](index=106&type=chunk) - Convertible Bridge Loans issued in Q1 2024 for **$0.7 million** (including related party amounts) carried a **20% premium** and were convertible at a **15% discount to VWAP**, with associated warrants[108](index=108&type=chunk)[109](index=109&type=chunk) - Convertible **12% Promissory Notes** for **$0.6 million** were issued in March 2024, measured at fair value, and convertible at **$2.00 per share**, with associated warrants[113](index=113&type=chunk) [7. Debt](index=31&type=section&id=7.%20Debt) This note details the company's debt obligations, including a revolving line of credit, related party loans, and short-term bridge loans - A **$5.0 million** revolving line of credit with a commercial bank, secured by all Company assets, had its maturity extended to September 18, 2024, and the **$15.0 million** minimum cash deposit requirement waived in April 2024[115](index=115&type=chunk) - Related Party Loans with NKMAX totaled **$5.0 million**, bearing a **4.6% interest rate** and maturing on December 31, 2024[118](index=118&type=chunk) - Bridge Loans for **$0.2 million** were issued in March 2024 with a **7.5% premium** and **15-day maturity**, subsequently repaid in April 2024[120](index=120&type=chunk) [8. Related Party Transactions](index=32&type=section&id=8.%20Related%20Party%20Transactions) This note describes transactions and financial instruments involving related parties, including founder shares and various debt and equity instruments - Founder Shares include **1,173,631 Deferred Founder Shares** subject to vesting conditions based on stock price thresholds (**$14.00** and **$20.00**) over a five-year period[121](index=121&type=chunk)[122](index=122&type=chunk) - Related party financial instruments include Founder Shares, SPA Warrants, Working Capital Warrants, Senior Convertible Notes, 2024 Related Party Convertible Bridge Loan, select Legacy Convertible Notes, Related Party Loans, Private Warrants, and Convertible Bridge Warrants[124](index=124&type=chunk) - No research and development expenses were recorded for laboratory supplies purchased from NKMAX for the three months ended March 31, 2024[125](index=125&type=chunk) [9. Fair Value of Financial Instruments](index=32&type=section&id=9.%20Fair%20Value%20of%20Financial%20Instruments) This note explains the methodologies and inputs used to determine the fair value of the company's financial instruments, categorized by valuation levels - Fair value measurements are categorized into Level 1 (quoted prices in active markets), Level 2 (observable inputs other than Level 1), and Level 3 (unobservable inputs)[127](index=127&type=chunk)[128](index=128&type=chunk) Liabilities Measured at Fair Value on a Recurring Basis (in thousands USD) as of March 31, 2024 | Instrument | Balance | Level 1 | Level 2 | Level 3 | | :---------------------------------- | :------ | :------ | :------ | :------ | | Convertible 12% Promissory Notes | $728 | $0 | $0 | $728 | | Private Warrants | $803 | $0 | $0 | $803 | | Working Capital Warrants | $89 | $0 | $0 | $89 | | PIPE Warrants | $19,704 | $0 | $0 | $19,704 | | Convertible Bridge Loan Warrants | $1,822 | $0 | $0 | $1,822 | | Convertible 12% Promissory Note Warrants | $942 | $0 | $0 | $942 | | Forward Purchase Derivative Liabilities | $10,085 | $0 | $0 | $10,085 | | Consideration Shares | $14 | $14 | $0 | $0 | | **Total** | **$34,187**| **$14** | **$0** | **$34,173**| - The fair value of Private Warrants, Working Capital Warrants, Convertible Bridge Loan Warrants, and Convertible 12% Promissory Note Warrants were measured using a Black-Scholes model with Level 3 inputs[136](index=136&type=chunk) [10. Stockholder's Equity](index=37&type=section&id=10.%20Stockholder%27s%20Equity) This note details the company's equity structure, including authorized and outstanding shares, and information on stock option and equity incentive plans - As of March 31, 2024, the Company had **500,000,000 authorized common shares**, with **22,388,976 shares** issued and outstanding[149](index=149&type=chunk) - The Company adopted an Employee Stock Purchase Plan (ESPP) and two equity incentive plans (2019 Plan and 2023 Plan) for granting stock options and restricted shares[151](index=151&type=chunk)[152](index=152&type=chunk)[154](index=154&type=chunk) Stock Option Activity (Three Months Ended March 31, 2024) | Item | Number of Stock Options | Weighted Average Exercise Price | | :-------------------------- | :---------------------- | :------------------------------ | | Outstanding as of Dec 31, 2023 | 2,078,986 | $6.25 | | Granted | 2,295,000 | $1.62 | | Forfeited | (109,725) | $6.65 | | **Outstanding as of Mar 31, 2024** | **4,264,261** | **$3.75** | | Stock-based compensation expense | $1,117 thousand USD | | [11. Property and Equipment, net](index=39&type=section&id=11.%20Property%20and%20Equipment%2C%20net) This note provides a breakdown of the company's property and equipment, net of accumulated depreciation Property and Equipment, net (in thousands USD) | Category | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Land | $5,025 | $5,025 | | Buildings | $8,325 | $8,325 | | Lab equipment | $4,004 | $4,004 | | Total gross property and equipment | $18,199 | $18,284 | | Less: Accumulated depreciation | $(4,063) | $(3,825) | | **Property and equipment, net** | **$14,136** | **$14,459** | - Depreciation expense related to property and equipment was **$0.3 million** for both Q1 2024 and Q1 2023[160](index=160&type=chunk) [12. Additional Balance Sheet Information](index=39&type=section&id=12.%20Additional%20Balance%20Sheet%20Information) This note provides further details on specific balance sheet accounts, including prepaid expenses, other current assets, accounts payable, and accrued expenses Prepaid Expenses and Other Current Assets (in thousands USD) | Category | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Prepaid expenses | $1,250 | $1,565 | | Other receivables | $26 | $26 | | Revolving line of credit issuance fees | $47 | $47 | | **Total** | **$1,323** | **$1,654** | Accounts Payable and Accrued Expenses (in thousands USD) | Category | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | Accounts payable | $12,835 | $11,040 | | Accrued liabilities | $1,630 | $1,360 | | Employee compensation | $733 | $911 | | Other | $115 | $84 | | **Total** | **$15,313** | **$13,395** | [13. Collaboration Agreement](index=40&type=section&id=13.%20Collaboration%20Agreement) This note discusses the strategic collaboration with Affimed GmbH, its discontinuation, and the resulting impact on research and development expenses - Strategic collaboration with Affimed GmbH for SNK01 in combination with AFM24 for EGFR expressing tumors was discontinued by mutual agreement in June 2023[163](index=163&type=chunk) - Total reductions to research and development expenses from this collaboration were less than **$0.1 million** for Q1 2024 and **$0.1 million** for Q1 2023[164](index=164&type=chunk) [14. Commitments and Contingencies](index=40&type=section&id=14.%20Commitments%20and%20Contingencies) This note outlines the company's contractual obligations, including operating leases, license agreements, and legal proceedings - A new operating lease agreement for office space in Irvine, California, commenced on January 1, 2024, with a term of approximately three years[166](index=166&type=chunk) Future Minimum Lease Payments (in thousands USD) | Year | Minimum lease payments | | :---------------------------------- | :--------------------- | | 2024 (excluding Q1 2024) | $176 | | 2025 | $242 | | 2026 | $249 | | **Total operating lease liability** | **$667** | - The Company has exclusive license agreements with NKMAX for intellectual property, requiring potential milestone payments (e.g., **$5.0 million** for US regulatory approval) and mid-single digit royalties on net sales[169](index=169&type=chunk)[170](index=170&type=chunk) - No material adverse legal proceedings or claims are currently pending against the Company[171](index=171&type=chunk) [15. Income Taxes](index=41&type=section&id=15.%20Income%20Taxes) This note explains the company's income tax position, including its effective tax rate and the impact of deferred tax balances and valuation allowances - The effective tax rate was **0.0%** for the three months ended March 31, 2024 and 2023[173](index=173&type=chunk) - The **0.0%** rate is primarily due to changes in deferred tax balances, partially offset by valuation allowances, reflecting the unlikelihood of realizing deferred tax assets given the Company's history of net losses[174](index=174&type=chunk) [16. Subsequent Events](index=42&type=section&id=16.%20Subsequent%20Events) This note discloses significant events that occurred after the balance sheet date, including new debt issuances and amendments to financial agreements - In April and May 2024, the Company issued several Convertible **12% Promissory Notes** totaling **$1.5 million**, with associated common stock and warrants, and repaid **$0.8 million** of these notes[175](index=175&type=chunk)[176](index=176&type=chunk)[177](index=177&type=chunk)[178](index=178&type=chunk)[179](index=179&type=chunk)[180](index=180&type=chunk)[181](index=181&type=chunk)[182](index=182&type=chunk)[183](index=183&type=chunk) - On April 5, 2024, a **$5.0 million Convertible Secured Promissory Note** was entered into, secured by a second lien on real property, convertible at **$2.00 per share**, and included issuance of common stock and warrants[184](index=184&type=chunk) - A Forward Purchase Agreement was amended on April 11, 2024, to adjust the Reset Price and allow for the purchase of additional FPA Shares[185](index=185&type=chunk) - Additional Convertible Bridge Loans and Zero Coupon Convertible Promissory Notes were entered into in April and May 2024, involving further issuances of common stock and warrants[186](index=186&type=chunk)[187](index=187&type=chunk)[188](index=188&type=chunk)[189](index=189&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=45&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and results of operations for the three months ended March 31, 2024, discussing business overview, highlights, factors affecting performance, key components of financial results, liquidity, and critical accounting policies. It emphasizes the company's clinical-stage status, ongoing losses, and need for additional financing [Overview](index=45&type=section&id=Overview) This section provides a high-level introduction to NKGen Biotech, Inc., its focus on cell therapies, and its recent public listing - NKGen Biotech, Inc. is a clinical-stage biotechnology company focused on developing innovative autologous, allogeneic, and CAR-NK cell therapies using its proprietary SNK platform[191](index=191&type=chunk) - The company's product candidates are based on a proprietary manufacturing and cryopreservation process which produces SNK cells with increased activity[191](index=191&type=chunk) - The company was renamed 'NKGen Biotech, Inc.' and its common stock and warrants began trading on Nasdaq on October 2, 2023, following a business combination[193](index=193&type=chunk) [Business Highlights](index=46&type=section&id=Business%20Highlights) This section summarizes key achievements and milestones, including regulatory clearances and clinical trial progress for the company's cell therapies - Received FDA IND clearance for SNK02 allogenic NK cell therapy for solid tumors on October 14, 2022[196](index=196&type=chunk) - Received FDA IND clearance for SNK01 in Alzheimer's Disease (AD) on October 20, 2023, and a No Objection Letter from Health Canada for SNK01 in AD on December 21, 2023[196](index=196&type=chunk) - Dosed the first participant in the US SNK01-AD01 clinical trial on December 28, 2023. Phase I data for SNK01 in AD showed **30% clinical improvement** and **60% stable ADCOMS scores**, with reduced CSF pTau181 and neuroinflammation[196](index=196&type=chunk)[197](index=197&type=chunk) [Factors Affecting Our Performance](index=46&type=section&id=Factors%20Affecting%20Our%20Performance) This section discusses the primary internal and external factors influencing the company's financial results and future prospects, including ongoing losses and funding needs - The Company incurred net losses of **$5.4 million** for Q1 2024 and has an accumulated deficit of **$167.5 million** as of March 31, 2024[198](index=198&type=chunk) - Significant expenses are expected to continue for R&D, clinical trials, manufacturing, intellectual property, and public company operations[198](index=198&type=chunk) - The Company requires immediate additional capital and has expressed substantial doubt about its ability to continue as a going concern, with failure to secure funding potentially leading to delays, curtailment, or termination of product development[199](index=199&type=chunk)[200](index=200&type=chunk) [Key Components of Results of Operations](index=47&type=section&id=Key%20Components%20of%20Results%20of%20Operations) This section breaks down the individual elements contributing to the company's financial performance, such as revenues, expenses, and other income/losses [Revenues](index=47&type=section&id=Revenues) This subsection addresses the company's revenue recognition policy and future expectations, noting the absence of product revenue to date - No product revenue has been recognized to date, and none is expected until successful development and regulatory approval of product candidates, which is many years away, if ever[201](index=201&type=chunk)[202](index=202&type=chunk) [Costs and Expenses](index=47&type=section&id=Costs%20and%20Expenses) This subsection details the nature and trends of the company's research and development, and general and administrative expenses - Research and development expenses include employee-related costs, process development, preclinical activities, clinical trials, and facility allocations, and are expected to increase[203](index=203&type=chunk)[204](index=204&type=chunk) - General and administrative expenses cover personnel, professional services, and overhead, and are anticipated to increase due to public company operating costs and future commercialization efforts[208](index=208&type=chunk)[209](index=209&type=chunk) [Interest Expense](index=48&type=section&id=Interest%20Expense) This subsection explains the sources of interest expense for the current and prior periods, including various debt instruments - Q1 2024 interest expense was primarily from the revolving line of credit, Convertible Bridge Loans, Bridge Loans, and Senior Convertible Notes[210](index=210&type=chunk) - Q1 2023 interest expense was mainly from Related Party Loans[210](index=210&type=chunk) - Interest expense for Legacy Convertible Notes and Convertible 12% Promissory Notes is recognized within changes in their fair value[211](index=211&type=chunk) [Loss on Amendment of Forward Purchase Contracts](index=49&type=section&id=Loss%20on%20Amendment%20of%20Forward%20Purchase%20Contracts) This subsection describes the financial impact of amendments made to forward purchase contracts, resulting in recognized losses - Amendments in December 2023 and January/February 2024 led to losses due to reduced subscription receivable, altered Reset Price, re-designated FPA Shares to Bonus Shares, and increased prepayment shortfall[213](index=213&type=chunk)[214](index=214&type=chunk) [Loss on Issuance of Convertible Bridge Loans](index=49&type=section&id=Loss%20on%20Issuance%20of%20Convertible%20Bridge%20Loans) This subsection explains the loss recognized from the issuance of convertible bridge loans and their associated warrants - A **$0.7 million** loss was recognized in Q1 2024 on the issuance of Convertible Bridge Loans, Convertible Bridge Loan Warrants, and Consideration Shares[215](index=215&type=chunk) - The loss reflects the **$1.4 million** fair value of Convertible Bridge Loan Warrants exceeding the **$0.7 million** proceeds received[215](index=215&type=chunk) [Gain on Amendment of PIPE Warrant Agreement](index=49&type=section&id=Gain%20on%20Amendment%20of%20PIPE%20Warrant%20Agreement) This subsection details the gain recognized from the amendment of the PIPE warrant agreement, driven by cash proceeds and fair value adjustments - A **$0.7 million** gain was recognized in Q1 2024 from the PIPE Warrant Amendment[216](index=216&type=chunk) - The gain was due to cash proceeds and a reduction in the fair value of the PIPE Warrant derivative liability, mainly from removing downside protection[216](index=216&type=chunk) [Change in Fair Value of the Forward Purchase Derivative Liabilities](index=49&type=section&id=Change%20in%20Fair%20Value%20of%20the%20Forward%20Purchase%20Derivative%20Liabilities) This subsection explains the gain recorded from changes in the fair value of forward purchase derivative liabilities, primarily due to share price movements - A **$0.5 million** gain was recorded in Q1 2024 from the change in fair value of forward purchase derivative liabilities[217](index=217&type=chunk) - The reduction in fair value was primarily related to the effect of share price reduction, decreasing potential amounts to be received under the subscription receivable[217](index=217&type=chunk) [Change in Fair Value of Derivative Warrant Liabilities](index=49&type=section&id=Change%20in%20Fair%20Value%20of%20Derivative%20Warrant%20Liabilities) This subsection details the gain recognized from changes in the fair value of derivative warrant liabilities, influenced by share price and volatility - A **$3.7 million** gain was recorded in Q1 2024 from the change in fair value of derivative warrant liabilities[218](index=218&type=chunk) - The gain was primarily due to a **$5.2 million** decrease in PIPE Warrants' fair value (linked to share price reduction), partially offset by increases in other warrants' fair value (linked to stock price volatility)[218](index=218&type=chunk)[238](index=238&type=chunk)[239](index=239&type=chunk) [Change in Fair Value of Convertible 12% Promissory Notes](index=50&type=section&id=Change%20in%20Fair%20Value%20of%20Convertible%2012%25%20Promissory%20Notes) This subsection explains the loss recorded from changes in the fair value of Convertible 12% Promissory Notes - A **$0.5 million** loss was recorded in Q1 2024 from the change in fair value of Convertible 12% Promissory Notes[219](index=219&type=chunk)[240](index=240&type=chunk) - This change is primarily related to their standalone value at March 31, 2024, in excess of the proceeds allocated on a relative fair value basis at issuance[240](index=240&type=chunk) [Change in Fair Value of Legacy Convertible Notes](index=50&type=section&id=Change%20in%20Fair%20Value%20of%20Legacy%20Convertible%20Notes) This subsection details the gain recognized from changes in the fair value of Legacy Convertible Notes in the prior period, prior to their conversion - A **$1.5 million** gain was recorded in Q1 2023 from the change in fair value of Legacy Convertible Notes[220](index=220&type=chunk)[241](index=241&type=chunk) - This change was attributed to the conversion of these notes upon the Business Combination, influenced by expected conversion prices and accrued interest[241](index=241&type=chunk) - No outstanding Legacy Convertible Notes were present for the three months ended March 31, 2024[241](index=241&type=chunk) [Other Income (Loss), Net](index=50&type=section&id=Other%20Income%20%28Loss%29%2C%20Net) This subsection summarizes other non-operating income and losses, including fixed asset disposals and sublease income - Q1 2024 other income (loss), net, primarily consisted of loss on disposal of fixed assets and change in fair value of Consideration Shares[221](index=221&type=chunk) - Q1 2023 other income (loss), net, included sublease income and other expenses[221](index=221&type=chunk) [Provision for Income Taxes](index=50&type=section&id=Provision%20for%20Income%20Taxes) This subsection explains the company's income tax provision, noting a zero effective tax rate due to valuation allowances - The effective tax rate was **0.0%** for both Q1 2024 and Q1 2023[223](index=223&type=chunk) - The **0.0%** rate is primarily due to changes in deferred tax balances, partially offset by valuation allowances, reflecting the unlikelihood of realizing deferred tax assets[223](index=223&type=chunk) [Results of Operations](index=51&type=section&id=Results%20of%20Operations) This section provides a detailed comparative analysis of the company's financial performance for the reported periods, highlighting key changes in revenues and expenses [Comparison of the Three Months Ended March 31, 2024 and 2023](index=51&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20March%2031%2C%202024%20and%202023) This subsection presents a comparative overview of the company's financial results for the first quarters of 2024 and 2023, detailing changes in key metrics Results of Operations (in thousands USD) | Metric | Q1 2024 | Q1 2023 | $ Change | % Change | | :------------------------------------------ | :------ | :------ | :------- | :------- | | Research and development expenses | $3,236 | $3,599 | $(363) | (10)% | | General and administrative expenses | $4,385 | $3,199 | $1,186 | 37% | | Total expenses | $7,621 | $6,798 | $823 | 12% | | Loss from operations | $(7,621)| $(6,798)| $(823) | 12% | | Interest expense | $(1,069)| $(34) | $(1,035) | * | | Loss on amendment of forward purchase contracts | $(396) | $0 | $(396) | * | | Loss on issuance of convertible bridge loans | $(729) | $0 | $(729) | * | | Gain on amendment of PIPE warrant agreement | $679 | $0 | $679 | * | | Change in fair value of forward purchase derivative liabilities | $535 | $0 | $535 | * | | Change in fair value of derivative warrant liabilities | $3,716 | $0 | $3,716 | * | | Change in fair value of convertible 12% promissory notes | $(478) | $0 | $(478) | * | | Change in fair value of legacy convertible notes | $0 | $(1,501)| $1,501 | * | | Net loss before provision for income taxes | $(5,382)| $(8,322)| $2,940 | (35)% | | **Net loss and comprehensive loss** | **$(5,382)**| **$(8,322)**| **$2,940** | **(35)%**| [Research and Development Expenses](index=51&type=section&id=Research%20and%20Development%20Expenses) This subsection analyzes the changes in research and development expenses, attributing shifts to personnel costs, supplies, and allocated facility expenses Research and Development Expenses (in thousands USD) | Category | Q1 2024 | Q1 2023 | $ Change | % Change | | :------------------------------------------ | :------ | :------ | :------- | :------- | | Total direct research and development expense | $185 | $272 | $(87) | (32)% | | Indirect research and development expense by type: | | | | | | Personnel-related costs | $1,844 | $2,213 | $(369) | (17)% | | Research and development supplies and services | $803 | $838 | $(35) | (4)% | | Allocated facility, equipment and other expenses | $404 | $276 | $128 | 46% | | **Total research and development expense** | **$3,236**| **$3,599**| **$(363)** | **(10)%**| - Total R&D expenses decreased by **$0.4 million (10%)** in Q1 2024, primarily due to a **$0.4 million** decrease in personnel-related costs (including a **$0.2 million** decrease in stock-based compensation)[225](index=225&type=chunk)[228](index=228&type=chunk) - Laboratory supply costs decreased by **$0.1 million**, offset by a **$0.1 million** increase in professional fees and a **$0.1 million** increase in allocated facility, equipment, and other expenses[229](index=229&type=chunk)[230](index=230&type=chunk) [General and Administrative Expenses](index=53&type=section&id=General%20and%20Administrative%20Expenses) This subsection examines the increase in general and administrative expenses, mainly driven by professional fees for public company operations - General and administrative expenses increased by **$1.2 million**, or **37%**, in Q1 2024 compared to Q1 2023[231](index=231&type=chunk) - The increase was primarily driven by a **$1.2 million** rise in professional fees (legal, consultant, accounting for public company operations) and a **$0.1 million** increase in taxes and licenses[231](index=231&type=chunk) - This increase was partially offset by a **$0.3 million** decrease in salaries[231](index=231&type=chunk) [Interest Expense](index=53&type=section&id=Interest%20Expense) This subsection analyzes the increase in interest expense, primarily due to new debt instruments outstanding in the current period - Interest expense increased by **$1.0 million** in Q1 2024 compared to Q1 2023[232](index=232&type=chunk) - Q1 2024 interest expense included **$0.6 million** from Convertible Bridge Loans, **$0.2 million** from Senior Convertible Notes, and **$0.1 million** from the revolving line of credit, which were not outstanding in Q1 2023[233](index=233&type=chunk) [Loss on Amendment of Forward Purchase Contracts](index=53&type=section&id=Loss%20on%20Amendment%20of%20Forward%20Purchase%20Contracts) This subsection details the loss incurred from amendments to forward purchase contracts, reflecting adjustments to subscription receivables and derivative liabilities - A **$0.4 million** loss was recorded in Q1 2024 due to amendments to forward purchase contracts[234](index=234&type=chunk) - The loss resulted from a **$2.8 million** reduction in the subscription receivable, partially offset by a **$1.4 million** reduction in forward purchase derivative liabilities and **$1.0 million** in consideration received[234](index=234&type=chunk) [Loss on Issuance of Convertible Bridge Loans](index=54&type=section&id=Loss%20on%20Issuance%20of%20Convertible%20Bridge%20Loans) This subsection explains the loss recognized upon the issuance of convertible bridge loans, driven by the fair value of associated warrants - A **$0.7 million** loss was recorded in Q1 2024 upon the issuance of Convertible Bridge Loans[235](index=235&type=chunk) - The loss resulted from the **$1.4 million** fair value of associated Convertible Bridge Loan Warrants exceeding the **$0.7 million** proceeds received from the transaction[235](index=235&type=chunk) [Gain on Amendment of PIPE Warrant Agreement](index=54&type=section&id=Gain%20on%20Amendment%20of%20PIPE%20Warrant%20Agreement) This subsection details the gain recognized from the amendment of the PIPE warrant agreement, stemming from cash proceeds and a reduction in derivative liability - A **$0.7 million** gain was recognized in Q1 2024 from the amendment of the PIPE warrant agreement[236](index=236&type=chunk) - The gain was attributed to **$0.3 million** in cash proceeds and a **$0.4 million** reduction in the fair value of the PIPE Warrant derivative liability, mainly due to the removal of downside protection cash provisions[236](index=236&type=chunk) [Change in Fair Value of Forward Purchase Derivative Liabilities](index=54&type=section&id=Change%20in%20Fair%20Value%20of%20Forward%20Purchase%20Derivative%20Liabilities) This subsection explains the gain recorded from changes in the fair value of forward purchase derivative liabilities, primarily due to share price fluctuations - A **$0.5 million** gain was recorded in Q1 2024 from the change in fair value of forward purchase derivative liabilities[237](index=237&type=chunk) - The reduction in fair value was primarily related to the effect of share price reduction, decreasing potential amounts to be received under the subscription receivable[237](index=237&type=chunk) [Change in Fair Value of Derivative Warrant Liabilities](index=54&type=section&id=Change%20in%20Fair%20Value%20of%20Derivative%20Warrant%20Liabilities) This subsection details the gain recognized from changes in the fair value of derivative warrant liabilities, influenced by share price and volatility - A **$3.7 million** gain was recorded in Q1 2024 from the change in fair value of derivative warrant liabilities[238](index=238&type=chunk) - This was primarily due to a **$5.2 million** decrease in the fair value of PIPE Warrants (driven by share price reduction), partially offset by increases in the fair value of Convertible 12% Promissory Note Warrants, Private Warrants, and Convertible Bridge Loan Warrants (driven by stock price volatility)[238](index=238&type=chunk)[239](index=239&type=chunk) [Change in Fair Value of Convertible 12% Promissory Notes](index=54&type=section&id=Change%20in%20Fair%20Value%20of%20Convertible%2012%25%20Promissory%20Notes) This subsection explains the loss recorded from changes in the fair value of Convertible 12% Promissory Notes, reflecting their standalone value - A **$0.5 million** loss was recorded in Q1 2024 from the change in fair value of Convertible 12% Promissory Notes[240](index=240&type=chunk) - This loss reflects the standalone value of these notes at March 31, 2024, exceeding the proceeds allocated on a relative fair value basis at issuance[240](index=240&type=chunk) [Change in Fair Value of Legacy Convertible Notes](index=54&type=section&id=Change%20in%20Fair%20Value%20of%20Legacy%20Convertible%20Notes) This subsection details the gain recognized from changes in the fair value of Legacy Convertible Notes in the prior period, prior to their conversion - A **$1.5 million** gain was recorded in Q1 2023 from the change in fair value of Legacy Convertible Notes[241](index=241&type=chunk) - This change was attributed to the conversion of these notes upon the Business Combination, influenced by expected conversion prices and accrued interest[241](index=241&type=chunk) - No outstanding Legacy Convertible Notes were present for the three months ended March 31, 2024[241](index=241&type=chunk) [Other Income (Loss), Net](index=55&type=section&id=Other%20Income%20%28Loss%29%2C%20Net) This subsection summarizes other non-operating income and losses, including the impact of a sublease arrangement and changes in fair value of common stock - Other income (loss), net, decreased by less than **$0.1 million** in Q1 2024 compared to Q1 2023[242](index=242&type=chunk) - The decrease was primarily due to the expiration of a sublease arrangement prior to July 2023, partially offset by a small increase in the fair value of liability-classified common stock issued in Q1 2024[242](index=242&type=chunk) [Liquidity and Capital Resources](index=55&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's ability to meet its short-term and long-term financial obligations, including funding requirements and sources of capital [Funding Requirements and Going Concern](index=55&type=section&id=Funding%20Requirements%20and%20Going%20Concern) This subsection discusses the company's ongoing funding needs, significant operating losses, and the substantial doubt about its ability to continue as a going concern - The Company has incurred significant operating losses and negative cash flows since inception, with a working capital deficit of **$35.9 million** as of March 31, 2024[243](index=243&type=chunk)[245](index=245&type=chunk) - Substantial doubt exists about the Company's ability to continue as a going concern, necessitating immediate additional capital[249](index=249&type=chunk)[251](index=251&type=chunk) - Failure to secure additional funding could force delays, reductions, or termination of product development and business activities, or even bankruptcy[244](index=244&type=chunk)[250](index=250&type=chunk) [Sources of Liquidity](index=57&type=section&id=Sources%20of%20Liquidity) This subsection identifies the company's primary sources of funding, including various debt and equity instruments, and its current cash position - Primary funding sources include convertible note financings, Bridge Loans, Related Party Loans, a revolving line of credit, and equity issuances[252](index=252&type=chunk) - As of March 31, 2024, cash and cash equivalents were less than **$0.1 million**, with **$0.3 million** in restricted cash[252](index=252&type=chunk) - Post-Q1 2024, the Company issued **$7.5 million** in additional debt, including a **$5.0 million convertible secured promissory note** and **$1.5 million** in Convertible **12% Promissory Notes**[245](index=245&type=chunk)[262](index=262&type=chunk) - Received **$1.5 million** from FPA amendments and **$0.9 million** from FPA share sales in Q1 2024, and **$10.2 million** from PIPE Warrants at closing[263](index=263&type=chunk)[265](index=265&type=chunk)[266](index=266&type=chunk) [Cash Flows](index=60&type=section&id=Cash%20Flows) This subsection analyzes the company's cash flows from operating, investing, and financing activities, highlighting significant changes between periods Summary of Cash Flows (in thousands USD) | Category | Q1 2024 | Q1 2023 | | :------------------------------------------ | :------ | :------ | | Net cash used in operating activities | $(4,034)| $(4,914)| | Net cash provided by (used in) investing activities | $35 | $(13) | | Net cash provided by financing activities | $4,007 | $5,558 | - Net cash used in operating activities decreased by **$0.9 million** in Q1 2024, primarily due to increased accounts payable and accrued expenses[276](index=276&type=chunk)[277](index=277&type=chunk) - Net cash provided by financing activities decreased by **$1.6 million** YoY, primarily due to proceeds from related party loans in 2023, offset by proceeds from FPA amendments and new debt issuances in 2024[281](index=281&type=chunk)[282](index=282&type=chunk)[283](index=283&type=chunk) [Contractual Obligations and Commitments](index=61&type=section&id=Contractual%20Obligations%20and%20Commitments) This subsection outlines the company's significant contractual obligations, including operating leases and long-term debt maturities - Contractual obligations include operating leases for corporate offices[284](index=284&type=chunk) - The Company has long-term debt which matures in 2027[285](index=285&type=chunk) [Critical Accounting Policies and Estimates](index=61&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section describes the accounting policies and estimates that require significant judgment and can materially impact the company's financial statements [Accrued Clinical and Research and Development Expenses](index=61&type=section&id=Accrued%20Clinical%20and%20Research%20and%20Development%20Expenses) This subsection explains the methodology for estimating and accruing research and development expenses, particularly for clinical trial activities - All research and development costs are expensed in the period incurred[288](index=288&type=chunk) - Accrued R&D expenses are estimated based on reviewing open contracts, communicating with personnel, and estimating service levels when invoices are not yet received[289](index=289&type=chunk) - Estimates are periodically confirmed with service providers, and adjustments are made for variations in actual timing or effort[290](index=290&type=chunk)[291](index=291&type=chunk) [Stock-Based Compensation](index=62&type=section&id=Stock-Based%20Compensation) This subsection details the accounting for stock-based compensation, including the valuation model and key assumptions used - Stock-based compensation expense is estimated using the Black-Scholes option pricing model on the grant date[292](index=292&type=chunk) - Key estimates for the model include common stock value, future volatility, expected term, risk-free interest rate, and expected annual dividend yield[292](index=292&type=chunk) - Expense for graded-vesting schedules is recognized on a straight-line basis over the vesting period[293](index=293&type=chunk) [Valuation of Common Shares](index=62&type=section&id=Valuation%20of%20Common%20Shares) This subsection describes the methods used to determine the fair value of common shares, both before and after public trading - Prior to public trading on October 2, 2023, common share fair value was determined by the board using objective and subjective factors, including independent valuations, comparable companies, and implied fair values from the Business Combination[294](index=294&type=chunk)[300](index=300&type=chunk) - Valuation methods included income and market approaches, with a discount for lack of marketability applied to privately traded shares[296](index=296&type=chunk) - Beginning October 2, 2023, the fair value of common shares is based on the publicly listed share price[298](index=298&type=chunk) [Accounting for Select Financial Instruments](index=63&type=section&id=Accounting%20for%20Select%20Financial%20Instruments) This subsection explains the classification and accounting treatment of various financial instruments as either liabilities or equity, based on relevant accounting standards - Select financial instruments are classified as liability or equity based on ASC 480 (Distinguishing Liabilities from Equity) and ASC 815 (Derivatives and Hedging Activities)[301](index=301&type=chunk) - Liability-classified instruments (e.g., Private Warrants, PIPE Warrants, Convertible 12% Promissory Notes, forward purchase derivative) require fair value accounting at issuance and subsequently, with changes recognized in earnings[304](index=304&type=chunk)[305](index=305&type=chunk) - Equity-classified instruments (e.g., Public Warrants, SPA Warrants, Deferred Founder Shares) are fair valued only at issuance, with no subsequent changes recognized[304](index=304&type=chunk)[305](index=305&type=chunk) [Fair Value of Financial Instruments](index=65&type=section&id=Fair%20Value%20of%20Financial%20Instruments) This subsection details the valuation techniques and inputs used to measure the fair value of financial instruments, categorized by valuation levels - Fair value measurements are categorized into Level 1, 2, and 3 inputs, with Level 3 inputs being unobservable and significant[307](index=307&type=chunk)[308](index=308&type=chunk) - Liability-classified warrants (Private, Working Capital, Convertible Bridge Loan, Convertible 12% Promissory Note) are valued using a Black-Scholes model with Level 3 inputs[313](index=313&type=chunk) - Forward purchase derivative liabilities and PIPE Warrants are valued using a Monte Carlo simulation, while Convertible 12% Promissory Notes use a binomial lattice model[314](index=314&type=chunk)[315](index=315&type=chunk) [Recently Issued and Adopted Accounting Pronouncements](index=66&type=section&id=Recently%20Issued%20and%20Adopted%20Accounting%20Pronouncements) This section refers to Note 2 for details on new accounting standards and their impact on the company's financial reporting - Information on recently issued accounting pronouncements is detailed in Note 2, 'Summary of Significant Accounting Policies'[319](index=319&type=chunk) [Emerging Growth Company Status](index=67&type=section&id=Emerging%20Growth%20Company%20Status) This section explains the company's status as an 'emerging growth company' and 'smaller reporting company,' and the associated exemptions from certain reporting requirements - The Company qualifies as an 'emerging growth company' under the JOBS Act, allowing it to rely on certain exemptions from public company reporting requirements[320](index=320&type=chunk) - Exemptions include delaying adoption of new accounting standards, not requiring auditor attestation for internal controls, and reduced executive compensation disclosures[320](index=320&type=chunk) - The Company also qualifies as a 'smaller reporting company,' providing further disclosure flexibility[322](index=322&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=67&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, NKGen Biotech, Inc. is not required to provide quantitative and qualitative disclosures about market risk - The Company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[323](index=323&type=chunk) [Item 4. Controls and Procedures](index=67&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, with the participation of the principal executive and financial officers, evaluated the effectiveness of the Company's disclosure controls and procedures as of March 31, 2024, concluding they were effective at a reasonable assurance level. No material changes in internal control over financial reporting were identified during the period - Disclosure controls and procedures were evaluated as effective at a reasonable assurance level as of March 31, 2024[325](index=325&type=chunk) - No material changes in internal control over financial reporting were identified during the period covered by this report[326](index=326&type=chunk) [PART II. OTHER INFORMATION](index=69&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part provides additional information not covered in the financial statements, including legal proceedings, risk factors, and equity security sales [Item 1. Legal Proceedings](index=69&type=section&id=Item%201.%20Legal%20Proceedings) The Company is not currently subject to any legal proceedings or claims that are expected to have a material adverse effect on its financial position, results of operations, or cash flows - No currently pending legal matters or claims are expected to have a material adverse effect on the Company's financial position, results of operations, or cash flows[327](index=327&type=chunk) [Item 1A. Risk Factors](index=69&type=section&id=Item%201A.%20Risk%20Factors) Readers are directed to carefully consider the risk factors disclosed in Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2023, for comprehensive information - Readers should refer to Item 1A, 'Risk Factors,' in the Annual Report on Form 10-K for the year ended December 31, 2023, for a comprehensive list of risk factors[328](index=328&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=69&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q1 2024, NKGen issued various unregistered equity securities, including warrants and common stock, in connection with short-term bridge notes and amendments to Forward Purchase Agreements. These transactions were exempt from registration under Section 4(a)(2) of the Securities Act or Rule 701 - From January 1, 2024, to March 31, 2024, NKGen issued unregistered warrants and common stock in connection with short-term bridge notes and amendments to Forward Purchase Agreements[329](index=329&type=chunk)[335](index=335&type=chunk) - Examples include **400,000 warrants** for a **$400,000 bridge note**, **100,000 warrants** for a **$100,000 bridge note**, and re-designation of **200,000 FPA Shares** to Bonus Shares[329](index=329&type=chunk) - These transactions were exempt from registration under Section 4(a)(2) of the Securities Act or Rule 701[331](index=331&type=chunk) [Item 3. Defaults Upon Senior Securities](index=70&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item states that there were no defaults upon senior securities during the reporting period - No defaults upon senior securities were reported[332](index=332&type=chunk) [Item 4. Mine Safety Disclosures](index=70&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item states that mine safety disclosures are not applicable to the Company - Mine safety disclosures are not applicable to the Company[333](index=333&type=chunk) [Item 5. Other Information](index=70&type=section&id=Item%205.%20Other%20Information) This item states that there is no other information to report - No other information was reported[334](index=334&type=chunk) [Item 6. Exhibits](index=71&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Quarterly Report on Form 10-Q, including merger agreements, certificates of incorporation, warrant agreements, promissory notes, and amendments to various financial agreements - The exhibits include the Agreement and Plan of Merger, Amended and Restated Certificate of Incorporation and Bylaws, various Warrant Agreements, and Promissory Notes[337](index=337&type=chunk)[338](index=338&type=chunk) - Also listed are amendments to Forward Purchase Agreements and Securities Purchase Agreements[337](index=337&type=chunk)[338](index=338&type=chunk) [SIGNATURES](index=74&type=section&id=SIGNATURES) This section contains the required signatures for the Quarterly Report on Form 10-Q, affirming its submission on behalf of NKGen Biotech, Inc. by its Chief Executive Officer and Interim Chief Financial Officer - The report is signed by Paul Y. Song, Chief Executive Officer, and James A. Graf, Interim Chief Financial Officer, on May 20, 2024[345](index=345&type=chunk)

Company Update - NKGen Biotech has received approval from its Safety Review Committee to commence its Phase 2 clinical study of SNK01, a drug aimed at treating moderate Alzheimer's disease [1][2] - The Phase 1 clinical trial results were positive, showing improved or maintained cognitive abilities after four doses, with no adverse effects reported [2] Clinical Trial Details - The Phase 2 trial will involve a larger patient group, with 20 patients receiving 20 doses of SNK01 and 10 patients receiving 10 placebo doses [2] - The CEO of NKGen Biotech expressed optimism about the clinical progress and the potential for significant clinical and biomarker data from the upcoming trial [3] Stock Performance - Following the announcement, NKGN stock experienced significant trading activity, with over 26 million shares traded, surpassing its average daily volume of 3.7 million shares [3] - As of Monday morning, NKGN stock price increased by 54% [4]

SNK01, a cryopreserved, autologous enhanced natural killer cell therapy, delivered in highest dose to date, demonstrates preliminary clinical benefit without any drug-related adverse events. Company advances SNK01 into Phase 2 in moderate Alzheimer's disease; first patient enrolled in Phase 2 expected in Q2 2024. SANTA ANA, Calif., May 20, 2024 (GLOBE NEWSWIRE) -- NKGen Biotech, Inc. (NASDAQ:NKGN) ("NKGen" or the "Company"), a clinical-stage biotechnology company focused on the development and commercializa ...

SNK01, a cryopreserved, autologous enhanced natural killer cell therapy, delivered in highest dose to date, demonstrates preliminary clinical benefit without any drug-related adverse events. Company advances SNK01 into Phase 2 in moderate Alzheimer's disease; first patient enrolled in Phase 2 expected in Q2 2024. SANTA ANA, Calif., May 20, 2024 (GLOBE NEWSWIRE) -- NKGen Biotech, Inc. (Nasdaq: NKGN) ("NKGen" or the "Company"), a clinical-stage biotechnology company focused on the development and commercializ ...

Core Insights - NKGen Biotech, Inc. is a clinical-stage biotechnology company focused on developing innovative NK cell therapeutics, including autologous, allogeneic, and CAR-NK therapies [1][5] - The company will present its cryopreserved, autologous, non-genetically modified NK cell therapy product, SNK01, at the 5th International Cell & Gene Therapy China Summit & Exhibition, highlighting its potential in treating neurodegenerative diseases and solid tumors [1][2] Company Presentation Details - Dr. Paul Y. Song will present on May 23, 2024, discussing the challenges in manufacturing autologous NK cells at scale and how NKGen's next-gen CMC manufacturing process has successfully addressed these challenges [3] - The presentation will cover the results of SNK01 in combination with immune checkpoint inhibitors for advanced solid tumors and its use with Erbitux in resistant non-small cell lung cancer [3] Scientific Rationale and Data - The presentation will emphasize SNK01's ability to improve levels of amyloid beta, tau, and alpha-synuclein proteins, as well as other biomarkers associated with various neurodegenerative diseases, suggesting its potential for treatment and prevention in high-risk patients [4]

SANTA ANA, Calif., May 16, 2024 (GLOBE NEWSWIRE) -- NKGen Biotech, Inc. (Nasdaq: NKGN) ("NKGen" or the "Company"), a clinical-stage biotechnology company focused on the development and commercialization of innovative autologous, allogeneic and CAR-NK natural killer ("NK") cell therapeutics, today announced that Paul Y. Song, MD, Chairman and Chief Executive Officer of NKGen, will present highlights of the Company's cryopreserved, autologous, non-genetically modified NK cell therapy product, SNK01, which has ...

NKGen advances its neurodegenerative disease program with FDA IND clearance for its Phase 1/2a SNK01 Clinical Trial in patients with Parkinson's disease. The Company expects to initiate a Phase 1 clinical trial in PD in 2H 2024. SANTA ANA, Calif., April 29, 2024 (GLOBE NEWSWIRE) -- NKGen Biotech, Inc. (NASDAQ:NKGN) ("NKGen" or the "Company"), a clinical-stage biotechnology company focused on the development and commercialization of innovative autologous, allogeneic and CAR-NK natural killer ("NK") cell ther ...

SANTA ANA, Calif., April 24, 2024 (GLOBE NEWSWIRE) -- NKGen Biotech, Inc. (NASDAQ:NKGN) ("NKGen" or the "Company"), a clinical-stage biotechnology company focused on the development and commercialization of innovative autologous, allogeneic and CAR-NK natural killer ("NK") cell therapeutics, today announced an online publication at the upcoming 2024 American Society of Clinical Oncology (ASCO) Annual Meeting to be held virtually and at the McCormick Place Convention Center in Chicago, Illinois from May 31–J ...