SQZ Biotechnologies (SQZB) DEFM14AProxy related to merger

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

(Rule 14a-101)

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.     )

Filed by the Registrant  ☒

Filed by a party other than the Registrant  ☐

Check the appropriate box:

SQZ Biotechnologies Company

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

SQZ BIOTECHNOLOGIES COMPANY

PO Box 5515

Wayland, Massachusetts 01778

January 23, 2024

To our stockholders:

You are invited to attend a special meeting of stockholders (the “Special Meeting”) of SQZ Biotechnologies Company, a Delaware corporation (the “Company” or “SQZ”), which will be held on February 29, 2024 at 9:30 a.m. Eastern Time. The Special Meeting will be held in a virtual-only format, which will be conducted via live webcast. You may attend the meeting online, submit questions, and vote your shares electronically during the meeting via live webcast by visiting: www.proxydocs.com/SQZB. In order to attend and/or participate, you must register in advance at www.proxydocs.com/SQZB prior to the deadline of February 28, 2024 at 5:00 p.m. Eastern Time. Upon properly completing your registration, you will receive further instructions via email, including your unique live meeting link that will allow you access to the Special Meeting and will also permit you to vote electronically and submit questions at the meeting.

The attached Notice of Special Meeting of Stockholders and proxy statement contain details of the business to be conducted at the Special Meeting.

Holders of record of our common stock, par value $0.001 per share, as of the close of business on January 23, 2024 are entitled to notice of and to vote at the Special Meeting, or any continuation, postponement or adjournment thereof. Your vote is important. Whether or not you are able to attend the meeting, it is important that your shares be represented and voted at the Special Meeting. Therefore, to ensure your vote is counted, we urge you to please promptly vote your shares by completing, signing, dating and returning your proxy card or by Internet or telephone voting as described on your proxy card. If you decide to attend the Special Meeting online, you will be able to change your vote or revoke your proxy, even if you have previously submitted your proxy.

On behalf of SQZ, we would like to thank you for your continued support.

SQZ BIOTECHNOLOGIES COMPANY

PO Box 5515

Wayland, Massachusetts 01778

NOTICE OF SPECIAL MEETING OF

STOCKHOLDERS

To be held on February 29, 2024

Important Notice Regarding the Availability of Proxy Materials for the Special Meeting to Be Held on February 29, 2024 at 9:30 a.m. Eastern Time. This proxy statement is first being sent to stockholders on or about January 24, 2024.

This proxy statement and our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, are also available on the SEC’s website at www.sec.gov.

January 23, 2024

TABLE OF CONTENTS

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement contains forward-looking statements, including within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical fact contained in this proxy statement are “forward-looking statements” for purposes of this proxy statement. These statements involve known and unknown risks, uncertainties, assumptions and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “target,” “predict,” “project,” “contemplate,” “should,” “will,” “would,” “continue” or the negative or plural of those terms or other similar expressions.

Forward-looking statements in this proxy statement include, but are not limited to:

The forward-looking statements in this proxy statement are only predictions. We based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Forward-looking statements are inherently subject to risks, uncertainties and assumptions, some of which cannot be predicted or quantified and some of which are beyond our control. Risks, uncertainties and assumptions that may cause actual results to differ materially from current expectations include, among other things, those set forth in under the caption “Risk Factors” in this proxy statement and SQZ’s most recent Annual Report on Form 10-K and its recent Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission (the “SEC”).

Any forward-looking statement in this proxy statement reflects our current view with respect to future events, speaks only as of the date of this proxy statement, and is subject to these and other risks, uncertainties and assumptions. Given these uncertainties, you should not rely on these forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, our information may be incomplete or limited and we cannot guarantee future results. Moreover, we

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operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. Except as required by law, we do not plan, and assume no obligation, to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. We qualify all of our forward-looking statements by these cautionary statements.

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WEBSITES

Website addresses referenced in this proxy statement are provided for convenience only, and the content on the referenced websites does not constitute a part of this proxy statement.

SQZ BIOTECHNOLOGIES COMPANY

PO Box 5515

Wayland, Massachusetts 01778

PROXY STATEMENT

This proxy statement is furnished in connection with the solicitation by the Board of Directors of SQZ Biotechnologies Company of proxies in connection with our Special Meeting of Stockholders to be held on February 29, 2024 (the “Special Meeting”), at 9:30 a.m. Eastern Time, and at any continuation, postponement, or adjournment of the Special Meeting. The Special Meeting will be a completely virtual meeting, which will be conducted via live webcast.

You will be able to participate in the Special Meeting online, vote your shares electronically and submit your questions before and during the Special Meeting by visiting www.proxydocs.com/SQZB. In order to attend and/or participate, you must register in advance at www.proxydocs.com/SQZB prior to the deadline of February 28, 2024 at 5:00 p.m. Eastern Time. Upon properly completing your registration, you will receive further instructions via email, including your unique live meeting link that will allow you access to the Special Meeting and will also permit you to vote electronically and submit questions at the meeting. You will not be able to attend the Special Meeting in person.

Holders of record of shares of our common stock, $0.001 par value per share (“Common Stock”), as of the close of business on January 23, 2024 (the “Record Date”), will be entitled to notice of and to vote at the Special Meeting and any continuation, postponement, or adjournment of the Special Meeting. As of the Record Date, there were 29,491,125 shares of Common Stock outstanding and entitled to vote at the Special Meeting. Each share of Common Stock is entitled to one vote on any matter presented to stockholders at the Special Meeting.

This proxy statement is dated January 23, 2024, and we expect to commence providing this proxy statement to our stockholders on or about January 24, 2024.

In this proxy statement, “SQZ”, “Company”, “we”, “us”, and “our” refer to SQZ Biotechnologies Company.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS

FOR THE STOCKHOLDER MEETING TO BE HELD ON FEBRUARY 29, 2024

This Proxy Statement is available at

http://www.proxydocs.com/SQZB

General

At the Special Meeting, you will be asked to consider and vote upon the following proposals.

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After careful consideration of a number of factors, as further described in this proxy statement, the Board has unanimously:

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SUMMARY TERM SHEET

Asset Purchase Agreement

The following is a summary of the key terms of the Asset Purchase Agreement. All capitalized, undefined terms used herein shall have the meanings ascribed to such terms in the Asset Purchase Agreement, which is attached to this proxy statement as Exhibit A.

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The summary of selected information from this proxy statement regarding the Sale Proposal may not contain all of the information that is important to you. To understand the Sale Proposal and the Asset Purchase Agreement fully, we encourage you to read carefully this entire proxy statement, including, but not limited to, the Asset Purchase Agreement which is attached to this proxy statement as Exhibit A.

Plan of Dissolution

The following is a summary of the material terms of the Plan of Dissolution. All capitalized, undefined terms used herein shall have the meanings ascribed to such terms in the Plan of Dissolution, which is attached to this proxy statement as Exhibit B.

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The summary of selected information from this proxy statement regarding the Dissolution Proposal may not contain all of the information that is important to you. To understand the Dissolution Proposal and the Plan of Dissolution fully, we encourage you to read carefully this entire proxy statement, including, but not limited to, the Plan of Dissolution which is attached to this proxy statement as Exhibit B.

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INTRODUCTORY SUMMARY

This summary highlights selected information contained in this proxy statement and may not contain all of the information that is important to you with respect to the Company. To understand fully the Sale Proposal and the Dissolution Proposal, and for a more complete description of the terms of the Sale pursuant to the Asset Purchase Agreement and the Dissolution pursuant to the Plan of Dissolution, you should carefully read this entire proxy statement.

Background of Asset Sale and Dissolution

The Company was incorporated in March 2013 in the State of Delaware. In November 2020, the Company completed its initial public offering (“IPO”) and began trading on the New York Stock Exchange (the “NYSE”). Historically, the Company has been a clinical-stage biotechnology company focused on unlocking the full potential of cell therapies to benefit patients with cancer and other serious medical conditions. The Company was founded on the therapeutic potential of Cell Squeeze^®, a proprietary technology which allows for rapid delivery of a variety of cargo into different cell types. Since inception, the Company funded its operations primarily with payments received in connection with collaboration agreements, proceeds from equity and debt financing (including its IPO and 2021 follow-on offering), and an Open Market Sales Agreement, dated as of November 10, 2021, with Jefferies LLC (“Jefferies” and such agreement, the “Sales Agreement”). Pursuant to the Sales Agreement, the Company authorized Jefferies to issue and sell up to $75 million in shares of the Company’s common stock from time to time during the term of the Sales Agreement through an “at-the-market” equity offering program under which Jefferies acts as the Company’s sales agent (the “ATM Facility”). The Company did not sell any shares under the ATM Facility during both the three and six months ended June 30, 2023. During the three and six months ended June 30, 2022, the Company sold 958,663 shares of common stock under the ATM Facility for net proceeds of approximately $3.1 million.

In July 2023, the NYSE suspended trading in the Company’s Common Stock pursuant to Section 802.01B of the NYSE’s Listed Company Manual because the Company had fallen below the NYSE’s continued listing standard requiring listed companies to maintain an average global market capitalization of at least $15 million over a consecutive 30-trading day period. The Company’s Common Stock began trading in the over-the-counter markets, under the symbol SQZB, on July 5, 2023.

On July 25, 2023, the Company announced that F. Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc. (collectively “Roche”) determined that it would not exercise its option under the license and collaboration agreement (the “2018 Roche Agreement”) and the parties agreed to terminate the 2018 Roche Agreement effective September 13, 2023. Under the 2018 Roche Agreement, Roche paid the Company $45 million in upfront cash in October 2018, and Roche agreed to pay to the Company certain milestone, reimbursement and royalty payments in connection with the products developed by Roche. Other than the upfront payment, the Company received $33 million from Roche pursuant to the terms of the 2018 Roche Agreement, prior to the termination of the 2018 Roche Agreement. Recognizing the effect that the termination of the 2018 Roche Agreement would have on the Company’s ability to continue as a going concern, the Company also announced that it intended to explore potential strategic alternatives to support the advancement of its oncology programs, including HPV 16 positive tumors, in an effort to allow the Company to partner its clinical and preclinical assets across all disease areas and indications.

Since inception the Company has faced challenges, including a failure to reach profitability in its business, and the Board and management have periodically evaluated the Company’s short-term and long-term strategic options. In recognition of these challenges, compounded by the termination of the 2018 Roche Agreement and available financing, in July 2023, the Board began discussions with representatives of Leerink Partners LLC (“Leerink Partners”) regarding strategic alternatives. On July 31, 2023, the Board formally engaged Leerink Partners to explore strategic alternatives for the Company, including a potential strategic acquisition in the biotechnology industry, the continued execution of the strategy as a stand-alone company and/or a possible strategic or financial investment by a third party, including a strategic sale to a third party, equity raise or other

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business combination. In making this determination, the Board considered, amongst other items, the Company’s ability to continue operating as a stand-alone entity.

Between July 22, 2023 and July 31, 2023, representatives of Leerink Partners worked with Company management and the Board to prepare initial sell-side materials and lists of potential investors and buyers. In July 2023, the Company approved a confidential information memorandum and formally commenced the strategic alternatives process. STEMCELL Parent was among the 52 potential buyers contacted by Leerink Partners in July and August 2023, as was a private equity sponsor referred to as “Party A”, a strategic party referred to as “Party B”, a strategic party referred to as “Party C” and a strategic party referred to as “Party D.” Of the 52 parties Leerink Partners contacted, five signed non-disclosure agreements and five submitted non-binding indications of interest and three submitted formal proposals in connection with this process, as further detailed below.

Prior to the Company’s initiation of the strategic alternatives process, the Company and STEMCELL Parent were party to that certain License and Development Agreement, dated as of April 21, 2020, pursuant to which the Company granted to STEMCELL Parent an exclusive license to commercialize, in the research use only market, the Company’s microfluidic chip and reagent reservoir. Through this business relationship, STEMCELL Parent became aware of the Company’s declining financial situation. Between April 27, 2023 and July 19, 2023, the Company’s management and representatives from STEMCELL Parent exchanged a number of emails and held multiple teleconference calls in which STEMCELL Parent expressed an interest in a transaction with the Company, if the Company were to pursue a strategic alternatives path.

On July 7 and 14, 2023, members of the Board convened with Leerink Partners via videoconference to discuss and consider a process to generate potential transactions that would provide opportunities to realize value from the sale of the Company as a whole, some or substantially all of the Company’s assets or other strategic collaborations or investments.

On July 21, 2023, management notified STEMCELL Parent that it would be pursuing strategic alternatives, and that if STEMCELL Parent were interested in participating in that process the Company would connect STEMCELL Parent with Leerink Partners. On July 22, 2023, STEMCELL Parent notified the Company that it would like to become involved in the strategic alternatives process.

During the week of July 24, 2023, management introduced STEMCELL Parent via email to Leerink Partners. Leerink Partners subsequently met via teleconference call with STEMCELL Parent on July 26, 2023, during which STEMCELL Parent indicated it was only interested in a transaction wherein it would acquire certain assets of the Company, rather than a transaction wherein it would acquire the equity of the Company. The day following that meeting, management and Leerink Partners discussed the STEMCELL Parent proposal and a proposed process, including STEMCELL Parent entering into a non-disclosure agreement in connection with the potential transaction. Management authorized Leerink Partners to negotiate and enter into a non-disclosure agreement with STEMCELL Parent, and management provided Leerink Partners a form of non-disclosure agreement to be shared with STEMCELL Parent.

On July 27, 2023, Party D provided a preliminary proposal to purchase all of the Company’s underlying issued and filed patents for $250,000 to $1,000,000, which Leerink Partners thereafter indicated the Company was not interested in.

During the week of July 30, 2023, Leerink Partners met with Party A and Party B via teleconference, during which each of Party A and Party B expressed an interest in participating in a potential transaction with the Company.

From August 2023 and into October 2023, Leerink Partners and management held teleconferences with Party B to encourage Party B to enter into a non-disclosure agreement, which Party B declined, and to exchange information regarding a potential transaction. On October 4, 2023, Party B submitted non-binding offers across four of the Company’s clinical programs for up to $70,000 and a 5% equity stake in Party B. On October 6, 2023,

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the Company and Leerink Partners determined that a transaction structured without substantial upfront proceeds and involving significant future at-risk considerations did not meet the financing needs of the Company.

On August 2 and 3, 2023, the Company and STEMCELL Parent negotiated and entered into a non-disclosure agreement regarding the potential transaction. On August 4, 2023, the Board held a meeting, at which Leerink Partners provided an overview of STEMCELL Parent to the Board. On August 8, 2023, at the direction of the Company, Leerink Partners granted STEMCELL Parent access to a virtual data room (the “Data Room”) that included customary business, financial, accounting, environmental, human resources and legal diligence information, in order for STEMCELL Parent to conduct its due diligence review of the Company. During the remainder of August 2023, the Company and Leerink Partners uploaded numerous contracts and other documents into the Data Room and responded to multiple diligence requests from STEMCELL Parent.

On August 7, 2023, at the direction of the Company, Leerink Partners provided a non-disclosure agreement to Party A.

On August 9, 2023, Party C called Leerink Partners to initiate its involvement in the transaction process and to discuss process and timing.

On August 10, 2023, the issuance date of the interim condensed consolidated financial statements for the three and six months ended June 30, 2023, the Company announced that it had substantial doubt about its ability to continue as a going concern for a period of one year from the date that those interim condensed consolidated financial statements were issued.

On August 17, 2023, Party A returned the executed non-disclosure agreement to Leerink Partners and was granted access to the Data Room.

On August 22, 2023, during a teleconference with Leerink Partners, Party C indicated its interest in alternative transaction structures.

From August 22 through September 14, 2023, at the direction of the Company, Leerink Partners held several teleconferences with Party A to discuss the process and timing for a potential transaction.

On August 30, 2023, STEMCELL Parent contacted Leerink Partners and indicated its interest in making an offer to acquire the Company’s platform technology and related intellectual property. On September 1, 2023, Leerink Partners provided additional details to STEMCELL Parent regarding the proposed structure of the potential transaction. Later that same day, the Board, the Company’s management and Leerink Partners held a meeting, during which Leerink Partners informed the Board of STEMCELL Parent’s interest in making an offer, likely to be structured as an asset or stock purchase.

On September 6, 2023, at the direction of the Company, Leerink Partners held a teleconference with Party C and discussed the strategic process and relevant intellectual property considerations.

That same day, STEMCELL Parent submitted an initial non-binding letter of interest, which contemplated two alternative structures, an asset purchase and a stock purchase (the “Initial STEMCELL Proposals”). Both structures contemplated the same base cash purchase price. The asset purchase structure provided for an amendment and assignment of that certain Amended and Restated Exclusive Patent License Agreement, dated as of December 2, 2015, as amended on May 17, 2022, by and between the Company and Massachusetts Institute of Technology (“MIT” and such agreement, the “MIT License Agreement”) and certain equipment and intellectual property, and the Company’s option to license back the acquired assets for use in the Company’s existing clinical programs. The stock purchase structure contemplated that the parties would agree on certain steps to be taken by Company in winding down its business, including the termination of all non-key employees and settlement of liabilities. Both the asset and share purchase proposals were conditioned on customary due diligence, reasonable exclusivity, STEMCELL Parent’s successful negotiation with MIT regarding limited amendments to SQZ’s remaining obligations under the MIT License Agreement, and the negotiation of a reasonable holdback amount.

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On September 7, 2023, the Company’s transaction committee, a subcommittee of the Board (the “Transaction Committee”) met informally via videoconference to consider and recommend a response to STEMCELL Parent’s initial proposal and its implications with respect to the alternative proposals from other potential parties.

On September 8, 2023, the Board held a videoconference with management and representatives from Leerink Partners to discuss the Initial STEMCELL Proposals and directed management and Leerink Partners to encourage STEMCELL Parent to enhance its proposal. On September 9, 2023, Leerink Partners spoke with STEMCELL via teleconference and communicated the Board’s feedback on the initial proposal and noted that STEMCELL Parent would need to improve its proposal to remain competitive in the process. STEMCELL Parent subsequently followed up with Leerink Partners to clarify certain information regarding the Company’s patent protection and prosecution costs.

On September 11, 2023, Leerink Partners and STEMCELL Parent met via teleconference and further discussed the Initial STEMCELL Proposals. Following the phone call, STEMCELL Parent furnished to Leerink Partners a revised non-binding offer, structured as an asset purchase structure, including a definitive list of the Company’s equipment to be agreed upon, and a materially increased purchase price of $7,500,000, with the other terms remaining substantially the same from the Initial STEMCELL Proposals (the “Revised STEMCELL Proposal”).

On September 13, 2023, the Transaction Committee met informally via videoconference to discuss the Revised STEMCELL Proposal and to consider the likelihood that a transaction could be consummated with any of the other potential bidders.

On September 14, 2023, Latham introduced management to representatives from Richards, Layton & Finger, P.A. (“RLF”) in order to discuss a potential dissolution or bankruptcy in connection with the strategic alternatives process.

On September 14 and 15, 2023, at the direction of the Company, Leerink Partners held teleconferences with Party C to discuss process and timing, and Leerink Partners provided Party C a non-confidential presentation, as well as a non-disclosure agreement for Party C to execute.

On September 15, 2023, the Board formally authorized and formed the Transaction Committee. That day, the Board, management, and Leerink Partners met via videoconference to discuss and evaluate the Revised STEMCELL Proposal, and management held an initial videoconference with RLF to discuss the potential dissolution or bankruptcy process.

Also on September 15, 2023, Party A submitted a preliminary non-binding proposal to Leerink Partners to purchase all of the Company’s equity for $3,000,000, which indicated financing was certain and contemplated a sixty-day exclusivity period for completion of due diligence. Later that day, Leerink Partners and Party A met via teleconference to discuss process and timing.

During the week of September 17, 2023, Leerink Partners exchanged emails with Party A to facilitate its due diligence exercise.

On September 20, 2023, the Company formally engaged RLF to explore a potential dissolution or bankruptcy in connection with the strategic alternatives process.

On September 21, 2023, Party C provided Leerink Partners with a revised non-disclosure agreement.

Also on September 21, 2023, at the direction of the Company, Leerink Partners spoke with STEMCELL Parent via teleconference, during which STEMCELL Parent verbally indicated that they would amend the Revised STEMCELL Proposal to address certain concerns of the Company, indicating a written revised

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non-binding offer was forthcoming. Following the call, STEMCELL Parent provided a written revised non-binding offer to Leerink Partners, which increased the purchase price to $11,000,000, with the other terms remaining substantially the same from the Revised STEMCELL Proposal (the “Second Revised STEMCELL Proposal”).

On September 22, 2023, the Transaction Committee met via videoconference to discuss and consider the Second Revised STEMCELL Proposal, and the amount necessary to pay off the Company’s liabilities in winding up the business. Separately on that day, the Board met via videoconference to discuss the Second Revised STEMCELL Proposal and assessed the certainty of closure it provided. The Board then instructed Leerink Partners to inform STEMCELL Parent of the Company’s need for a higher purchase price to allow the Company to pay off its liabilities while increasing the likelihood the Company could provide value to its stockholders.

On September 23, 2023, Leerink Partners called STEMCELL Parent to communicate the Company’s feedback with respect to the Second Revised STEMCELL Proposal, and during the call STEMCELL Parent verbally agreed to send another revised proposal. That evening, STEMCELL Parent emailed Leerink Partners its final revised non-binding offer (the “Final STEMCELL Proposal”). The Final STEMCELL Proposal, amongst other items, (i) increased the purchase price to $12,000,000 (ii) contained terms respecting exclusivity, prohibitions on asset disposal, a holdback and (iii) was conditioned upon STEMCELL Parent’s and the Company’s successful negotiation on an amendment to MIT License Agreement.

On September 25, 2023, at the direction of the Company, Leerink Partners contacted Party C to provide an update on process and timing for the potential transaction.

On September 26, 2023, the Company notified STEMCELL Parent that it was prepared to continue negotiations and finalize transaction documentation on substantially the same terms included in the Final STEMCELL Proposal.

On September 26 and 27, 2023, management emailed representatives from MIT and asked if MIT would be willing to speak with one or more potential acquirors of the Company and/or its assets. On September 29, 2023, following MIT’s acceptance of the Company’s proposal, representatives from the Company, STEMCELL Parent and Leerink Partners met via videoconference regarding potential amendments to the MIT License Agreement. The parties determined to continue discussions and STEMCELL Parent proposed to send MIT an initial draft of an amendment to the MIT License Agreement. On October 6, 2023, STEMCELL Parent sent MIT the initial draft of the amendment. Between October 11, 2023 and December 21, 2023, STEMCELL Parent, the Company and/or MIT exchanged numerous emails, met via videoconference and/or teleconference approximately five times and exchanged approximately five full drafts of the proposed amendment to the MIT License Agreement.

On September 27, 2023, at the direction of the Company, Leerink Partners rescinded Party A’s Data Room access because Party A did not provide sufficient evidence it was able to transact and was unwilling to disclose information the Board deemed necessary to continue discussions.

Between September 21, 2023 and September 28, 2023, management and RLF exchanged emails regarding potential candidates for the position of Chief Restructuring Officer, including Michael Jacoby of Phoenix Management.

On September 29, 2023, the Company announced a restructuring, pursuant to which it would cease substantially all research and development activities and reduce its work force by approximately 80% to reduce ongoing operating expenses in furtherance of completing its review of strategic alternatives as further discussed in this proxy statement. The Company expected to continue to treat currently enrolled patients in its enhanced antigen presenting cell (eAPC) and activating antigen carriers (AAC) programs in HPV16+ tumors through November 2023.

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On September 29, 2023, the Board met via videoconference to discuss a potential restructuring and/or dissolution process and the Final STEMCELL Proposal and ongoing process with STEMCELL Parent. Also on that day, Leerink Partners and STEMCELL Parent met via teleconference to discuss process and timing. The parties determined that the Company’s counsel, Latham & Watkins LLP (“Latham”), would provide the initial draft of the asset purchase agreement.

Beginning on September 30, 2023, and throughout October 2023, management exchanged emails and held several teleconferences with Michael Jacoby and representatives from RLF regarding the process for and costs associated with the potential dissolution and/or bankruptcy, including to discuss the Company’s budget, lease obligations, projected cash flows and options for disposing of excess equipment.

On October 2, 2023, Party C provided to management and Leerink Partners a preliminary non-binding offer to purchase all of the Company’s assets in exchange for shares of Party C’s common stock equaling between 2.5% to 12.5% of Party C’s total issued and outstanding equity. Party C’s proposal, which expired the next day, contemplated voting agreements in favor of the proposal to be entered into by the Company’s directors, officers and stockholders. On October 3, 2023, management met with Leerink Partners via teleconference to discuss Party C’s offers, during which Leerink Partners was instructed to inform Party C that its offer was not viable. On October 4, 2023, following conversations with management, Leerink Partners informed Party C that its proposal was not viable.

On October 6, 2023, management, Leerink Partners and STEMCELL Parent met via videoconference and discussed the terms of the Final STEMCELL Proposal and related process of the potential transaction.

On October 10, 2023, at the direction of the Company, Leerink Partners held a teleconference with STEMCELL Parent to discuss process and timing for the potential transaction, after which Latham was instructed to distribute the initial draft of the asset purchase agreement.

On October 16 and 18, 2023, the Company held videoconferences with Latham to discuss the key terms of, and process and timing for, the initial draft of the asset purchase agreement. Later on October 18, 2023, Latham provided the initial draft asset purchase agreement to STEMCELL Parent and its counsel, Farris LLP (“Farris”).

On October 20, 2023, the Board met with management via videoconference to discuss process and timing for the potential transaction with STEMCELL Parent.

On October 23, 2023, at the direction of the Company, Leerink Partners met with STEMCELL Parent via teleconference to discuss process and timing, including the timing for STEMCELL Parent’s revised draft asset purchase agreement.

On October 30, 2023, representatives from Latham and Farris met via videoconference to discuss the initial draft asset purchase agreement.

That evening, at the direction of the Company, Leerink Partners and STEMCELL Parent met via teleconference and discussed certain process matters, including the timing for distribution of a revised draft asset purchase agreement and its key terms, including the scope of transferred assets, during which Leerink Partners advised STEMCELL Parent of the Company’s plans to wind down its business, indicating the Company would not accept an escrow mechanism to hold back any portion of the purchase price, nor would the Company accept representations that may be applicable to a going concern selling a business unit.

On November 2, 2023, management met via videoconference with Michael Jacoby and RLF to discuss SEC filing obligations in connection with the potential dissolution and/or bankruptcy.

On November 3, 2023, Farris provided to Latham a draft exclusivity agreement and a revised draft asset purchase agreement, which expanded of the list of transferred assets and included an $1,800,000 holdback of a portion of the purchase price for a period of two years following the closing of the proposed transaction.

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On November 7, 2023, management held a videoconference with representatives from Latham, Leerink Partners, STEMCELL Parent and Farris to discuss the latest draft asset purchase agreement. Following the videoconference, management met with Latham and Leerink Partners twice via videoconference to debrief and to discuss process and timing.

On November 8, 2023, at the direction of the Company, representatives from Leerink Partners and STEMCELL Parent met via teleconference to discuss process and timing, including timing for distribution of the next draft of the asset purchase agreement, the scope of transferred assets and scope of the representations and warranties, and the holdback terms proposed by STEMCELL Parent. Leerink Partners noted that STEMCELL Parent’s proposed escrow was higher than the Company would be willing to accept.

Later that evening, at the direction of the Company, Leerink Partners met via teleconference with STEMCELL Parent to provide feedback on the revised draft asset purchase agreement, including an increase to the purchase price, given the expanded scope of the transferred assets, and to decrease the amount and time of any holdback.

On November 9, 2023, STEMCELL Parent articulated its position to Leerink Partners via email, confirming it contemplated an asset purchase structure for $12,000,000, the desired scope of the transferred assets, and a willingness to reduce the holdback amount and period. Later that day, management met with Latham and Leerink Partners via videoconference to discuss process and timing and to consider next steps.

On November 10, 2023, following negotiations among STEMCELL Parent, the Company and their respective advisors, the Company and STEMCELL Parent agreed that, in exchange for eliminating the holdback mechanism proposed by STEMCELL Parent, the parties would continue negotiations based on a purchase price of $11,800,000 with no holdback.

From November 16, 2023 to November 20, 2023, management and Latham exchanged emails regarding the terms of the asset purchase agreement and on the evening of November 20, 2023, Latham provided a revised asset purchase agreement to Farris, which narrowed the scope of representations and warranties proposed by STEMCELL Parent and removed the holdback provision, amongst other changes.

On November 21, 2023, Farris emailed Latham, confirming receipt of the revised asset purchase agreement and requesting to revisit the exclusivity issue. That day, management exchanged emails with Latham and Leerink Partners regarding process and timing and instructed Leerink Partners to call STEMCELL Parent to highlight the need to expedite the negotiations.

On November 22, 2023, Leerink Partners met with STEMCELL Parent via teleconference and emphasized the need for expedited timing and the Company’s desire for another draft of the asset purchase agreement.

On November 24, 2023, STEMCELL Parent emailed Leerink Partners to identify key issues in the latest draft asset purchase agreement, including the scope of transferred and excluded assets, representations and warranties, and STEMCELL Parent’s desire for an exclusivity agreement.

On November 28, 2023, Farris provided a revised asset purchase agreement to Latham. Key changes to this revised draft included, amongst other items, an expansion of the scope of the transferred personal property to include all personal property of the Company, expansion of the scope of the assigned technology to be all technology of the Company, additional representations, and the inclusion of an indemnity capped at the purchase price and terminating on the Company’s dissolution following the Closing of the proposed transaction.

On the morning of November 29, 2023, management held a videoconference with Latham and Leerink Partners to discuss material issues with the revised draft asset purchase agreement. That afternoon, management met with STEMCELL Parent via teleconference to discuss the latest draft asset purchase agreement. Management subsequently instructed Latham to provide a list of material issues with draft asset purchase agreement.

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Also on November 29, 2023, management informed Michael Jacoby and representatives from RLF via email that negotiations with STEMCELL Parent were faltering and the Company needed to further explore the potential bankruptcy, and RLF furnished a bankruptcy preparation checklist to management.

On December 1, 2023, the Board met with management and Leerink Partners via videoconference, during which Leerink Partners updated the Board on negotiations with STEMCELL Parent, expressing concerns with the likelihood of closure and certainty of proceeds.

Also on December 1, 2023, Latham furnished a list of the Company’s material issues in the latest draft asset purchase agreement to management. That evening, management requested an all-hands call with the Company, STEMCELL Parent and their respective financial and legal advisors to discuss the open issues in the draft asset purchase agreement, noting that if a path to executing the definitive documentation was not clear to management, the Board instructed management to seek an alternative transaction, including to continue discussions regarding a potential dissolution. On request by STEMCELL Parent, management emailed STEMCELL Parent with a list of the Company’s material issues in the latest draft asset purchase agreement.

On December 4, 2023, management met with Latham via videoconference to discuss process and timing. Later that day, management and Latham met with STEMCELL Parent and Farris via videoconference to discuss process and timing and the key terms of the asset purchase agreement.

On December 5, 2023, management held a videoconference with Latham to discuss issues contained in the latest draft of the asset purchase agreement. Later that afternoon, management and Latham met with STEMCELL Parent and representatives from Farris and STEMCELL Parent’s U.S. and securities counsel, Nixon Peabody LLP (“Nixon”), to discuss these issues. That evening, STEMCELL Parent emailed management and Latham stating its expectations with regard to the scope of transferred assets and intellectual property, including that there would be no license back.

On December 6, 2023, management and representatives from Latham met via videoconference with representatives from STEMCELL Parent, Farris and Nixon and discussed material tax issues raised in STEMCELL Parent’s revised draft asset purchase agreement. Latham previewed the changes it was planning to propose along with the rationale for such changes.

Later that evening, Latham provided a revised draft asset purchase agreement and ancillary documentation to STEMCELL Parent and Farris, requesting any comments within two days. Key changes in this revised draft included, amongst other items, a transfer of only the personal property identified in a schedule, express exclusion of assets previously included in the transaction, and changes to the warranties and indemnification provisions.

On the morning of December 7, 2023, management and Latham held a videoconference with STEMCELL Parent and representatives from Farris and Nixon to discuss the scope of assets to be transferred. That evening, Farris emailed Latham to provide a revised issues list covering the remaining issues in the draft asset purchase agreement.

On the morning of December 8, 2023, management held a videoconference with Latham to discuss the revised issues list and instructed Latham to address those issues in a meeting with the STEMCELL Parent’s legal representatives. That afternoon, Latham held a videoconference with Farris, Nixon and representatives from STEMCELL Parent to discuss the issues list, resolving certain issues in the draft agreement, while acknowledging that others remained outstanding. STEMCELL Parent also requested that certain material agreements be uploaded to the Data Room for its review.

Also on that day, the Board met with management and Leerink Partners via videoconference to discuss process and timing and key agreed-upon terms of the asset purchase agreement, including changing the structure of the transaction to be a sale of substantially all of the Company’s assets.

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From December 10 to December 16, 2023, management and Latham uploaded a number of the Company’s commercial contracts into the Data Room in order to provide STEMCELL Parent the opportunity to complete its legal and business diligence.

Also on December 11, 2023, Latham held a videoconference and shared the draft asset purchase agreement with RLF to review and address issues of Delaware law in connection with the asset purchase and proposed dissolution. That day, representatives of STEMCELL Parent visited the Company’s warehouse facility in Woonsocket, Rhode Island to inspect the condition of the transferred equipment.

On December 12, 2023, management held a videoconference with Latham to discuss the draft asset purchase agreement.

That evening, Farris provided a revised draft asset purchase agreement to Latham, which included, amongst other items, the transfer of substantially all of the Company’s assets, pushback on the actions the Company would be permitted to take in winding-down the business, and changes to the indemnification provisions, including increasing the indemnification cap above the 5% of the purchase price proposed by the Company.

On December 13, 2023, management met with Michael Jacoby via videoconference to discuss next steps in the bankruptcy process, and the next day management exchanged emails with Michael Jacoby regarding the documentation the Company should prepare should the Company elect to pursue a bankruptcy.

On December 13, 2023, management met with Latham and Leerink Partners via videoconference to discuss process and timing, and management instructed Leerink Partners to inform STEMCELL Parent that it must either accept the previous draft asset purchase agreement provided to STEMCELL Parent by the Company, with minimal changes, or the Company would otherwise pursue an alternative transaction. That evening, Leerink Partners spoke on the phone with STEMCELL Parent, highlighting that, unless STEMCELL Parent promptly provided a mark-up to the asset purchase agreement, the Company would pursue an alternative transaction. STEMCELL Parent did not comply with this instruction.

On December 14, 2023, management, Leerink Partners and STEMCELL Parent exchanged emails regarding the remaining open issues in the draft asset purchase agreement, including, among other items, (i) the indemnity cap and (ii) the Company’s ability to take limited actions to wind down its business prior to the Closing of the proposed transaction.

On the morning of December 15, 2023, management met with Latham and Leerink Partners via videoconference to discuss the draft asset purchase agreement and potential paths forward to signing a definitive agreement with STEMCELL Parent. Management instructed Latham to prepare revised drafts of the asset purchase agreement and related transaction documentation, with proposed compromise positions in respect of the issues raised by STEMCELL Parent. That evening, Latham furnished proposed final versions of the asset purchase agreement and ancillary documentation to STEMCELL Parent and Farris, requesting confirmation that STEMCELL Parent was prepared to execute the transaction documents by no later than 12:00 p.m. Eastern Standard Time on Monday, December 18, 2023.

On December 16, 2023, in response to the Company’s December 18, 2023 deadline for STEMCELL Parent to confirm it was prepared to execute the transaction documents, Farris responded with a list of matters to be resolved prior to executing the transaction documents.

On the morning of December 17, 2023, management held a videoconference and exchanged emails with Latham and Leerink Partners to discuss the asset purchase agreement. Thereafter, Latham furnished a revised draft asset purchase agreement to STEMCELL Parent and Farris along with responses to Farris’s issues list. That evening, Farris emailed Latham, providing further comments to the issues list.

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On the morning of December 18, 2023, management held a videoconference with Latham and Leerink Partners to discuss the process and timing. Thereafter, Latham furnished a revised draft asset purchase agreement to Farris.

Also on December 18, 2023, management met with Michael Jacoby and RLF via videoconference to discuss process and timing and to consider the Final STEMCELL Proposal against other strategic alternatives.

That afternoon, a special meeting of the Board was held via videoconference, together with management and representatives from Latham and Leerink Partners. During the meeting, Latham reviewed the key terms of the proposed transaction and the fiduciary obligations of the Board in connection with a sale process, and Leerink Partners reviewed the financial terms of the proposed transaction and thereafter rendered its oral opinion that the transaction was fair to the Company, from a financial perspective. The Board then directed management to seek to finalize the asset purchase agreement, but authorized management to walk away if negotiations failed to progress. Throughout the remainder of that day, Latham and Farris exchanged emails to resolve the few remaining open issues.

On December 19, 2023, management held a videoconference with Leerink Partners, and exchanged emails with Latham, to discuss the remaining open items, including open items with respect to the MIT Amendment. Thereafter, management discussed process and timing with Leerink Partners. On that same day, Leerink Partners delivered its written fairness opinion to the Company, which stated that, as of such date and based upon and subject to the various assumptions made by the Company, and the qualifications and limitations upon the review undertaken by Leerink Partners in preparing its opinion, the cash purchase price of $11.8 million proposed to be paid by STEMCELL Parent pursuant to the terms of the asset purchase agreement was fair, from a financial point of view.

In connection with the development of Leerink Partners’ financial analyses, the Company prepared and provided to Leerink Partners estimates as to the Company’s financial situation in either the case of (i) an orderly liquidation and dissolution following the completion of a strategic sale of substantially all of the Company’s assets for a total of $11.8 million (the “Dissolution Case”) and (ii) following the Company’s inability to complete a strategic sale to a third party, the sale of the all of the Company’s assets through bankruptcy proceedings (the “Bankruptcy Case”). In the Dissolution Case, the Company determined there would potentially be sufficient cash available to distribute approximately $0.0368 per share to its stockholders. In the Bankruptcy Case, the Company determined that there would be no distributable cash available, regardless of whether the Company were able to obtain proceeds totaling 100%, 75% or 50% of $11.8 million, respectively, from a bankruptcy sale, given the significant costs that would be incurred in the Bankruptcy Case. For a detailed discussion of Leerink Partners’ opinion, please see the heading entitled “—Opinion of our Independent Advisor” beginning on page 39 of this proxy statement.

On December 20, management advised STEMCELL Parent that, since the definitive transaction documents remained unexecuted, the Company was ceasing discussions and moving forward with alternative plans. During this day, STEMCELL Parent and MIT continued negotiations on the MIT Amendment.

Throughout December 20, 2023, management exchanged emails and held three videoconferences with Latham and Leerink Partners to discuss process and timing, and management exchanged drafts of the MIT Amendment with STEMCELL Parent and MIT.

That evening, after receipt of the final form of MIT Amendment, Farris indicated that STEMCELL Parent was prepared to cause the Purchaser to enter into all transaction documents, and management authorized Latham to finalize all transaction documentation.

On December 21, 2023, the Company finalized and executed the Asset Purchase Agreement and MIT Amendment, and on December 22, 2023, the Company publicly announced the signing of the Asset Purchase Agreement on Form 8-K.

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RISK FACTORS

The following risk factors, together with the other information in this proxy statement and in the “Risk Factors” sections included in the documents incorporated by reference into this proxy statement (see the section entitled “Where You Can Find Additional Information” beginning on page 121 of this proxy statement), should be carefully considered before deciding whether to vote to approve the Sale Proposal and the Dissolution Proposal as described in this proxy statement. In addition, stockholders should keep in mind that the risks described below are not the only risks that are relevant to your voting decision. The risks described below are the risks regarding the Sale and the Dissolution that we currently believe are the material risks of which our stockholders should be aware. Nonetheless, additional risks that are not presently known to us, or that we currently believe are not material, may also prove to be important.

RISKS RELATED TO THE SALE

The proposed Sale is subject to several conditions beyond our control. Failure to complete the Sale could materially and adversely affect our future business, results of operations, financial condition and stock price.

The closing of the Sale is conditioned on the receipt of the approval of our stockholders, as well as the satisfaction of other closing conditions, including performance in all material respects by each party of its obligations under the Asset Purchase Agreement.

We cannot predict whether and when the conditions will be satisfied. If one or more of these conditions is not satisfied, and as a result, we do not complete the Sale, or in the event the Sale is not completed or is delayed for any other reason, we may be harmed because:

The occurrence of these or other events individually or in combination could have a material adverse effect on our business, results of operations, financial condition and stock price.

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In addition, our stock price may fluctuate significantly based on announcements by us, the Purchaser or third parties regarding the Sale or our business.

The Asset Purchase Agreement contains provisions that could discourage a potential competing acquirer.

The Asset Purchase Agreement contains “no solicitation” provisions that restrict our ability to solicit, initiate, or knowingly encourage, facilitate or induce third party proposals for the acquisition of our common stock or to pursue an unsolicited offer, subject to certain limited exceptions. In addition, the Purchaser has an opportunity to modify the terms of the Asset Purchase Agreement in response to any competing acquisition proposals before the Board may withdraw or change its recommendation with respect to the Sale. Upon the termination of the Asset Purchase Agreement to pursue an alternative transaction, including in connection with a “superior proposal”, we will be required to pay $360,000 as a termination fee. These provisions could discourage a potential third-party acquirer from considering or proposing an acquisition transaction, even if it were prepared to pay a higher price than what would be received in the Sale, or propose to acquire our entire company. These provisions might also result in a potential third-party acquirer proposing to pay a lower price than it might otherwise have proposed to pay because of the added expense of the termination fee that may become payable. If the Asset Purchase Agreement is terminated and we determine to seek another purchaser for substantially all our assets or another business combination, we may not be able to negotiate a transaction with another party on terms comparable to, or better than, the terms of the Sale.

We will incur significant costs in connection with the Sale, whether or not it is consummated.

We have and will continue to incur substantial expenses related to the Sale, whether or not it is completed. We have recorded significant transaction-related costs, and we anticipate incurring additional costs and expenses until completion of the Sale. In addition, we will incur additional financial advisory fees that are payable upon consummation of the Sale. Finally, we may also be required to pay $360,000 to the Purchaser if the Asset Purchase Agreement is terminated under certain circumstances. Payment of these expenses by us as a standalone entity would adversely affect our operating results and financial condition and would likely adversely affect our stock price.

We cannot predict the timing, amount or nature of any distributions to our stockholders.

See “Risks Related to the Dissolution — We cannot predict the timing of the distributions to stockholders.”

RISKS RELATED TO THE DISSOLUTION

We cannot predict the timing of the distributions to stockholders.

Our current intention is that, if approved by our stockholders, the Certificate of Dissolution would be filed promptly after approval and consummation of the Sale; however, the timing of such filing and the decision of whether or not to proceed with the Dissolution will be made by the Board in its sole discretion and in its own timing. No further stockholder approval would be required to effect the Dissolution. However, if the Board determines that the Dissolution is not in our best interest or the best interest of our stockholders, the Board may, in its sole discretion, abandon the Dissolution or may amend or modify the Plan of Dissolution to the extent permitted by Delaware law without the necessity of further stockholder approval. After the Certificate of Dissolution has been filed, revocation of the Dissolution would require stockholder approval under Delaware law.

Under Delaware law, before a dissolved corporation may make any distribution to its stockholders, it must pay or make reasonable provision to pay all of its claims and obligations, including all contingent, conditional or unmatured contractual claims known to the corporation. Furthermore, we may be subject to potential liabilities relating to indemnification obligations, if any, to third parties or to our current and former officers and directors. It might take significant time to resolve these matters, and as a result we are unable to predict the timing of distributions, if any are made, to our stockholders.

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We cannot assure you as to the amount of distributions, if any, to be made to our stockholders.

We cannot predict the amount of distributions, if any, to our stockholders. Amounts, if any, may be paid in one or more distributions. Such distributions, if any, will not occur until after the Certificate of Dissolution is filed, and we cannot predict the timing or amount, if any, of such distributions, as uncertainties as to the ultimate amount of our liabilities, operating costs and amounts to be set aside for claims, obligations and provisions during the liquidation and winding-up process, and the related timing to complete such transactions make it impossible to predict with certainty the actual net cash amount that could ultimately be available for distribution to stockholders or the timing of such distributions, if any. Examples of uncertainties that could reduce the value of distributions to our stockholders include, without limitation: unanticipated costs relating to the defense, satisfaction or settlement of lawsuits or other claims threatened against us or our directors or officers; amounts necessary to resolve claims of any creditors or other third parties; and delays in the liquidation and dissolution or other winding up process.

In addition, as we wind down, we will continue to incur expenses from operations, including directors’ and officers’ insurance; payments to service providers and any continuing officers or consultants; taxes; legal, accounting and consulting fees and expenses related to our filing obligations with the SEC, which will reduce any amounts available for distribution to our stockholders. As a result, we cannot assure you as to amounts, if any, to be distributed to our stockholders if the Board proceeds with the Dissolution. If our stockholders do not approve the Dissolution Proposal, we will not be able to proceed with the Dissolution, and no liquidating distributions will be made in connection therewith.

It is the current intent of the Board, assuming approval of the Dissolution, that any cash will first be used to pay our outstanding current liabilities and then will be retained to pay ongoing corporate and administrative costs and expenses associated with winding down the company, liabilities and potential liabilities relating to or arising out of any litigation matters and potential liabilities relating to our indemnification obligations, if any, to our service providers, or to our current and former officers, consultants and directors.

The Board will determine, in its sole discretion, the timing of the distribution of the remaining amounts, if any, to our stockholders in the Dissolution. We can provide no assurance as to if or when any such distribution will be made, and we cannot provide any assurance as to the amount, if any, to be paid to stockholders in any such distribution, if one is made. Stockholders may receive no distribution at all. To the extent funds are available for distribution to stockholders, the Board intends to seek to distribute such funds to our stockholders at some point following the filing of the Certificate of Dissolution, as permitted by the DGCL, and intends to take reasonable actions to optimize the distributable value to our stockholders.

If our stockholders do not approve the Dissolution Proposal, we would not be able to continue our business operations.

On September 29, 2023, we announced a workforce reduction of approximately 80% of our remaining employees and the decision to cease substantially all research and development activities to reduce our ongoing operating expenses while we pursue strategic alternatives. If our stockholders do not approve the Dissolution Proposal, the Board will continue to explore what, if any, alternatives are available for the future of the Company in light of its discontinued business activities and its lack of resources; however, those alternatives are likely limited to seeking voluntary dissolution at a later time with potentially diminished assets or seeking bankruptcy protection. It is unlikely that these alternatives would result in greater stockholder value than the proposed Plan of Dissolution and the Dissolution.

The Board may determine not to proceed with the Dissolution.

Even if the Dissolution Proposal is approved by our stockholders, the Board may determine in its sole discretion not to proceed with the Dissolution. Further, the Board has not set a deadline to make its decision on

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whether to proceed with the Dissolution after stockholder approval is obtained. If our Board elects to pursue any alternative to the Plan of Dissolution, our stockholders may not receive any of the funds that might otherwise be available for distribution to our stockholders. After the Certificate of Dissolution has been filed, revocation of the Dissolution would require stockholder approval under Delaware law.

Our stockholders may be liable to third parties for part or all of the amount received from us in our liquidating distributions if reserves are inadequate.

If the Dissolution becomes effective, we may establish a contingency reserve designed to satisfy any additional claims and obligations that may arise. Any contingency reserve may not be adequate to cover all of our claims and obligations. Under the DGCL, if we fail to create an adequate contingency reserve for payment of our expenses, claims and obligations, each stockholder could be held liable for payment to our creditors for claims brought prior to or after the expiration of the Survival Period (as defined below) after we file the Certificate of Dissolution with the Secretary of State (or, if we choose the Safe Harbor Procedures (as defined under the section entitled “Proposal 2 — Approval of the Dissolution Pursuant to the Plan of Dissolution — Delaware Law Applicable to Our Dissolution — Payments and Distributions to Claimants and Stockholders — Safe Harbor Procedures under DGCL Sections 280 and 281(a)” beginning on page 49 of this proxy statement), for claims brought prior to the expiration of the Survival Period), up to the lesser of (i) such stockholder’s pro rata share of amounts owed to creditors in excess of the contingency reserve and (ii) the amounts previously received by such stockholder in Dissolution from us and from any liquidating trust or trusts. Accordingly, in such event, a stockholder could be required to return part or all of the distributions previously made to such stockholder, and a stockholder could receive nothing from us under the Plan of Dissolution. Moreover, if a stockholder has paid taxes on amounts previously received, a repayment of all or a portion of such amount could result in a situation in which a stockholder may incur a net tax cost if the repayment of the amount previously distributed does not cause a commensurate reduction in taxes payable.

Our stockholders of record will not be able to buy or sell shares of our Common Stock after we close our stock transfer books on the Effective Time.

If the Board determines, in its sole discretion and in its own timing, to proceed with the Dissolution, we intend to close our stock transfer books and discontinue recording transfers of our Common Stock at the Effective Time. After we close our stock transfer books, we will not record any further transfers of our Common Stock on our books except by will, intestate succession or operation of law. Therefore, shares of our Common Stock will not be freely transferable after the Effective Time. As a result of the closing of the stock transfer books, all liquidating distributions in the Dissolution will likely be made pro rata to the same stockholders of record as the stockholders of record as of the Effective Time.

We have initiated steps to exit from our reporting requirements under the Exchange Act, which will substantially reduce publicly available information about us. If the exit process is protracted, we will continue to bear certain expenses of being a public reporting company despite having no source of revenue.

Our periodic reporting obligations were suspended upon our filing a Form 15 on January 4, 2024, and therefore publicly available information about us will be substantially reduced. While our periodic reporting obligations under Section 15(d) of the Exchange Act are suspended, we will still be required to comply with certain public company reporting requirements in connection with this proxy statement until our Form 15 becomes effective. Compliance with these remaining Exchange Act requirements will be costly and time-consuming. Accordingly, we will continue to incur expenses that will reduce any amount available for distribution, including expenses of complying with certain public company reporting requirements and paying our service providers, among others.

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If we make a series of liquidating distributions, stockholders may not be able to recognize a loss for U.S. federal income tax purposes until they receive the final distribution from us.

Distributions (if any) made pursuant to the Plan of Dissolution are intended to be treated as received by stockholders as a series of liquidating distributions. Accordingly, as a result of the Dissolution, for U.S. federal income tax purposes, a stockholder that is a U.S. Holder (as defined in the section entitled “Certain Material U.S. Federal Income Tax Consequences of the Proposed Dissolution”) generally will recognize gain or loss on a share-by-share basis equal to the difference between (1) the sum of the amount of cash and the fair market value of property, if any, distributed to the U.S. Holder with respect to each share of Common Stock, less any known liabilities assumed by the U.S. Holder or to which the distributed property (if any) is subject, and (2) the U.S. Holder’s adjusted tax basis in each share of our Common Stock. Any liquidating distributions pursuant to the Plan of Dissolution may occur at various times and in more than one tax year. Any loss generally will be recognized by a U.S. Holder only in the tax year in which the U.S. Holder receives our final liquidating distribution, if any, and then only if the aggregate value of all liquidating distributions with respect to a share of our Common Stock is less than the U.S. Holder’s tax basis for that share.

For a more detailed discussion, including with respect to Non-U.S. Holders (as defined below), see the section entitled “Certain Material U.S. Federal Income Tax Consequences of the Proposed Dissolution” beginning on page 58 of this proxy statement. Stockholders are urged to consult with their tax advisors as to the specific tax consequences to them of the Dissolution pursuant to the Plan of Dissolution.

The tax treatment of any liquidating distribution may vary from stockholder to stockholder, and the discussions in this proxy statement regarding tax consequences are general in nature.

We have not requested a ruling from the Internal Revenue Service (the “IRS”) with respect to the anticipated tax consequences of the Dissolution, and we will not seek an opinion of counsel with respect to the anticipated tax consequences of any liquidating distributions. If any of the anticipated tax consequences described in this proxy statement prove to be incorrect, the result could be increased taxation at the corporate or stockholder level, thus reducing the benefit to our stockholders and us from the Dissolution. Tax considerations applicable to particular stockholders may vary with and be contingent on the stockholder’s individual circumstances.

You should consult your tax advisor for tax advice instead of relying on the discussions of tax consequences in this proxy statement.

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QUESTIONS AND ANSWERS REGARDING THIS SOLICITATION

AND VOTING AT THE SPECIAL MEETING

The following are some of the questions you may have as an SQZ stockholder and answers to those questions. These questions and answers highlight only some of the information contained in this proxy statement. You should read carefully this entire document, including all exhibits and annexes hereto, to fully understand the Sale Proposal, the Dissolution Proposal, the Adjournment Proposal and the voting procedures for the Special Meeting.

Special Meeting and Voting

When and where will the Special Meeting be held?

The Special Meeting will be held on February 29, 2024 at 9:30 a.m. Eastern Time. The Special Meeting will be a completely virtual meeting, which will be conducted via live webcast. You will be able to attend the Special Meeting online and submit your questions during the meeting by visiting www.proxydocs.com/SQZB. In order to attend and/or participate, you must register in advance at www.proxydocs.com/SQZB prior to the deadline of February 28, 2024 at 5:00 p.m. Eastern Time. Upon properly completing your registration, you will receive further instructions via email, including your unique live meeting link that will allow you access to the Special Meeting and will also permit you to vote electronically and submit questions at the meeting.

Why am I receiving these materials, and who is soliciting my vote?

We sent you this proxy statement because our Board is soliciting your proxy to vote at the Special Meeting that SQZ is holding to seek stockholder approval of the Sale Proposal, the Dissolution Proposal and the Adjournment Proposal, as described in further detail herein. This proxy statement summarizes the information you need to vote at the Special Meeting. You do not need to attend the Special Meeting to vote your shares.

Why hold a virtual meeting?

We believe that hosting a virtual meeting is in the best interest of the Company and its stockholders. Furthermore, a virtual meeting enables increased stockholder attendance and participation because stockholders can participate from any location around the world. You will be able to attend the Special Meeting online and submit your questions by visiting www.proxydocs.com/SQZB. You also will be able to vote your shares electronically at the Special Meeting by following the instructions below.

What is the purpose of the Special Meeting?

At the Special Meeting, stockholders will vote on the matters described in the accompanying Notice of Special Meeting and this proxy statement. The only matters expected to be voted upon at the Special Meeting are the Sale Proposal, the Dissolution Proposal and the Adjournment Proposal.

When is the Record Date for the Special Meeting?

The Record Date for determination of stockholders entitled to vote at the Special Meeting is the close of business on January 23, 2024.

Which stockholders may vote?

The Board has fixed the close of business on January 23, 2024 as the Record Date for determining the stockholders of SQZ who are entitled to receive notice of the Special Meeting and to vote their shares at the Special Meeting. Only stockholders as of the Record Date will be entitled to notice of, and to vote at, the Special Meeting, or any continuation, postponement or adjournment thereof. Each share of SQZ’s Common Stock is entitled to one vote. As of the Record Date, SQZ had issued and outstanding 29,491,125 shares of Common Stock.

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What am I being asked to vote on?

The Board is asking SQZ’s stockholders of record at the close of business on January 23, 2024, the Record Date for the Special Meeting, to consider and vote upon the Sale Proposal, Dissolution Proposal and Adjournment Proposal. As of the date of this proxy statement, the Board currently knows of no other business that will be presented for consideration at the Special Meeting. In the event any matters other than those referred to in the accompanying Notice of Special Meeting and this proxy statement should properly come before and be considered at the Special Meeting, it is intended that any proxy holder may vote on the matter in his or her discretion on behalf of the stockholder or stockholders granting such proxy.

Why is SQZ seeking a stockholder vote on the Adjournment Proposal?

Adjourning the Special Meeting to a later date will give the Board additional time to solicit proxies and obtain sufficient votes in favor of approval of the Sale Proposal and/or the Dissolution Proposal if there are not sufficient votes to approve such proposals at the time of the Special Meeting. Consequently, SQZ is seeking your approval of the Adjournment Proposal to ensure that, if necessary, SQZ will have additional time to solicit the required votes for approval of the Sale Proposal and the Dissolution Proposal.

What are the recommendations of the Board for how I should vote my shares?

The Board unanimously recommends that you vote “FOR” the Sale Proposal, “FOR” the Dissolution Proposal and “FOR” the Adjournment Proposal.

Who can attend the Special Meeting?

Only stockholders of record as of the close of business on the Record Date, or their duly appointed proxies, may attend the Special Meeting.

A complete list of such stockholders will be open to the examination of any stockholder for a period of ten days prior to the Special Meeting for a purpose germane to the meeting by sending an email to Lawrence Knopf, General Counsel and Secretary, at GeneralCounsel@sqzbiotech.com, stating the purpose of the request and providing proof of ownership of the Company’s Common Stock. The Special Meeting may be continued or adjourned from time to time without notice other than by announcement at the Special Meeting.

How is a quorum reached?

A quorum must be present at the Special Meeting for any business to be conducted. The holders of a majority in voting power of the Company’s Common Stock issued and outstanding and entitled to vote, present in person, including by remote communication, or represented by proxy, constitutes a quorum. If you sign and return your paper proxy card or authorize a proxy to vote electronically or telephonically, your shares will be counted to determine whether we have a quorum even if you abstain or fail to vote as indicated in the proxy materials. There are 29,491,125 shares of our Common Stock outstanding and entitled to vote on the Record Date. Shares present virtually during the Special Meeting will be considered shares of Common Stock represented in person at the meeting.

Under the DGCL, shares that “abstain” or are “withheld” from voting and “broker non-votes” are counted as present for purposes of determining whether a quorum is present at the Special Meeting. If a quorum is not present or represented at the scheduled time of the Special Meeting, (i) the chairperson of the Special Meeting or (ii) a majority in voting power of the stockholders entitled to vote thereon, present in person, including by remote communication, or represented by proxy, may adjourn the Special Meeting until a quorum is present or represented.

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What vote is needed for each of the proposals to be adopted?

Under the Restated Certificate of Incorporation of the Company (the “Charter”), the affirmative vote of the holders of at least two-thirds in voting power of the Company’s outstanding shares of capital stock entitled to vote on the Sale Proposal is required to approve the Sale Proposal. Abstentions and broker non-votes will have the same effect as votes “AGAINST” the Sale Proposal.

Under the Charter, the affirmative vote of the holders of at least two-thirds in voting power of the Company’s outstanding shares of capital stock entitled to vote on the Dissolution Proposal is required to approve the Dissolution Proposal. Abstentions and broker non-votes will have the same effect as votes “AGAINST” the Dissolution Proposal.

If a quorum is present at the Special Meeting, the affirmative vote of the holders of a majority in voting power of the votes cast affirmatively or negatively is required for the approval of the Adjournment Proposal. Broker non-votes (if any) and abstentions will not be counted as votes cast on the matter and will have no effect on the outcome of the Adjournment Proposal.

What are broker non-votes?

Generally, broker non-votes occur when shares held by a broker in “street name” for a beneficial owner are not voted with respect to a particular proposal because the broker (1) has not received voting instructions from the beneficial owner and (2) lacks discretionary voting power to vote those shares. A broker is entitled to vote shares held for a beneficial owner on routine matters. On the other hand, absent instructions from the beneficial owner of such shares, a broker is not entitled to vote shares held for a beneficial owner on non-routine matters.

The Sale Proposal, Dissolution Proposal and Adjournment Proposal are considered non-routine matters.

What is the difference between being a “record holder” and holding shares in “street name”?

A record holder (also called a “registered holder”) holds shares in his or her name. Shares held in “street name” means that shares are held in the name of a bank, broker or other nominee on the holder’s behalf.

What do I do if my shares are held in “street name”?

If your shares are held in a brokerage account or by a bank or other holder of record, you are considered the “beneficial owner” of such shares held in “street name.” As the beneficial owner, you have the right to direct your broker, bank or other holder of record on how to vote your shares by following their instructions for voting. Please refer to information from your bank, broker or other nominee on how to submit your voting instructions.

How do I vote my shares prior to the Special Meeting or if I do not plan on attending the Special Meeting?

We recommend that stockholders submit a proxy even if they plan to attend the Special Meeting and vote electronically.

Stockholders of Record. If you are a stockholder of record, there are three ways to submit a proxy:

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In addition, you can vote electronically at the Special Meeting. To do so, you must register in advance at www.proxydocs.com/SQZB prior to the deadline of February 28, 2024 at 5:00 p.m. Eastern Time. You will be asked to provide the company number and control number from the Internet Notice. Upon properly completing your registration, you will receive further instructions via email, including your unique live meeting link that will allow you access to the meeting and you will have the ability to vote electronically.

Internet and telephone voting facilities for stockholders of record will be available 24 hours a day until the time at which online voting closes at the Special Meeting. Whether or not you expect to attend the Special Meeting online, we urge you to submit a proxy directing how to vote your shares as promptly as possible to ensure your representation and the presence of a quorum at the Special Meeting. If you submit your proxy, you may still decide to attend the Special Meeting and vote your shares electronically. We encourage stockholders to submit their proxy via the Internet or telephone.

Beneficial Owners of Shares Held in “Street Name.” If your shares are held in “street name” through a bank or broker, you will receive instructions on how to vote from the bank or broker. You must follow their instructions in order for your shares to be voted. Internet and telephone voting also may be offered to stockholders owning shares through certain banks and brokers. If you wish to attend the Special Meeting and vote your shares online at the Special Meeting, you must register with your control number and obtain a legal proxy from your bank or broker in order to cast your vote. If your shares are not registered in your own name or if you lose your control number, you should contact your bank or broker to obtain your control number or otherwise vote through the bank or broker.

How can I attend and vote at the Special Meeting?

The Special Meeting will be held entirely online. There will not be a physical meeting location and you will not be able to attend the meeting in person. To participate in the Special Meeting virtually via the internet, please visit www.proxydocs.com/SQZB prior to the meeting.

You must register by February 28, 2024 at 5:00 p.m. Eastern Time to attend the Special Meeting webcast.

Upon properly completing your registration, you will receive further instructions via email, including your unique live meeting link that will allow you access to the Special Meeting and will permit you to submit questions before and during the Special Meeting and vote. We encourage you to access the meeting prior to the start time. Online check-in will begin at 9:15 a.m. Eastern Time and you should allow ample time for the check-in procedures. Even if you plan to attend the Special Meeting, we encourage you to vote in advance by Internet, telephone or mail so that your vote will be counted even if you later decide not to attend the Special Meeting.

Can I revoke or change my vote after I submit my proxy?

Yes. Whether you have submitted a proxy by Internet, telephone or mail, if you are a stockholder of record, you may change your vote and revoke your proxy:

If you hold shares in street name, you may submit new voting instructions by contacting your bank, broker or other nominee. You may also change your vote or revoke your proxy during the Special Meeting if you obtain a signed proxy from the record holder (broker, bank or other nominee) giving you the right to vote the shares.

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Your most recent proxy card or telephone or Internet proxy is the one that is counted. Your attendance at the Special Meeting by itself will not revoke your proxy unless you give written notice of revocation to the Company before your proxy is voted or you vote at the Special Meeting.

Who will count the votes?

A representative of Mediant Communications Inc., our inspector of election, will tabulate and certify the votes.

What if I vote for one, but not all, of the proposals?

Shares of SQZ’s Common Stock represented by proxies received by SQZ (whether received through the return of the enclosed proxy card or received by telephone or via the Internet) where the stockholder has provided voting instructions with respect to the proposals described in this proxy statement will be voted in accordance with the voting instructions so made. If your proxy card is properly executed and returned but does not contain voting instructions as to one or more of the proposals to be voted upon at the Special Meeting, or if you give your proxy by telephone or via the Internet without indicating how you want to vote on each of the proposals to be voted upon at the Special Meeting, your shares will be voted “FOR” the Sale Proposal, the Dissolution Proposal and the Adjournment Proposal.

Who will pay for the cost of this proxy solicitation?

The Company will pay the cost of solicitation of proxies. This includes the charges and expenses of brokerage firms and other vendors for forwarding solicitation material to beneficial owners of the Company’s outstanding Common Stock. The Company may solicit proxies by mail, personal interview, telephone or via the Internet through its officers and directors, who will receive no additional compensation for their services. We may also utilize the assistance of one or more third parties in connection with our proxy solicitation efforts, and we would compensate such third parties for their efforts. To date, we have engaged one such third party, Morrow Sodali Global LLC, to assist in the solicitation of proxies and provide related advice and informational support, for services fees of up to $15,000 and the reimbursement of certain expenses.

Do I have appraisal rights?

No. Under Delaware law, you do not have appraisal rights in connection with any of the proposals.

What if during the check-in time or during the Special Meeting, I have technical difficulties or trouble accessing the virtual meeting website?

We will have technicians ready to assist you with any technical difficulties you may have accessing the virtual meeting website, and the information for assistance will be located in the email you receive with information on how to join the Annual Meeting.

Who can help answer my additional questions?

If you have any additional questions about the Special Meeting, Sale, Asset Purchase Agreement, Sale Proposal, Dissolution, Plan of Dissolution, Dissolution Proposal or Adjournment Proposal, how to submit your proxy, or if you need additional copies of this proxy statement or the enclosed proxy card, please contact SQZ at SQZ Biotechnologies Company, PO Box 5515, Wayland, Massachusetts 01778, (617) 758-8672.

How can I find out the voting results?

We plan to announce preliminary voting results at the Special Meeting and will publish final results in a press release following the Special Meeting.

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Proposed Sale Pursuant to the Asset Purchase Agreement

Why is SQZ seeking a stockholder vote on the Sale Proposal?

Under Section 271 of the DGCL, a Delaware corporation must obtain the approval of a majority of the corporation’s outstanding stock in the proposed sale of all or substantially all of such corporation’s assets. Additionally, under Article FIFTH of the Charter, the Company must obtain the approval of the holders of at least two-thirds in voting power of the Company’s outstanding shares of capital stock entitled to vote thereon before proceeding with the sale, lease or exchange (in one transaction or a series of transactions) of all or substantially all of the Company’s assets. The Board therefore is seeking stockholder approval of the Sale Proposal in order to comply with the Charter and Delaware law.

Why is the Board recommending approval of the Sale pursuant to the Asset Purchase Agreement?

After considering at length the potential strategic alternatives available to the Company, including an evaluation to identify any available strategic alternatives and transactions involving the Company as a whole, such as a merger, reverse merger, sale of assets, strategic partnership or other business combination transaction, that would have a reasonable likelihood of providing value to our stockholders in excess of the amount, if any, the stockholders would receive in a liquidation, the Board unanimously determined that effecting the Sale on the terms and subject to the conditions set forth in the Asset Purchase Agreement is fair to, and in the best interests of, the Company and our stockholders. See “Proposal 1: Approval of the Sale Pursuant to the Asset Purchase Agreement” for additional information.

When is the closing of the Sale expected to occur?

If the Sale is approved by stockholders and all conditions to completing the Sale are satisfied or waived, the Sale is expected to occur as soon as practicable after the Special Meeting and prior to April 30, 2024.

What will happen if the Sale Proposal is approved by stockholders?

If the Sale Proposal is approved by our stockholders, among other things as may be completed at such times as the Board or, if applicable, our officers, in accordance with Delaware law, deem necessary, appropriate or advisable in our best interests and the best interests of our stockholders, we will consummate the Sale pursuant to the Asset Purchase Agreement. See “Proposal 1: Approval of the Sale Pursuant to the Asset Purchase Agreement” for further information.

What will happen if the Sale Proposal is not approved by stockholders?

If our stockholders vote against the Sale Proposal or fail to vote and the Sale Proposal is not approved, the Sale would not occur and could result in our inability to pay off existing debt, liabilities and other obligations, and we may be required to seek the protection of the bankruptcy courts. If the Sale Proposal is not approved and the Dissolution Proposal is approved, we may not have sufficient funds to proceed with the dissolution, and if we are unable to identify and implement a meaningful strategic alternative in a timely manner, the Board is likely to consider bankruptcy. See “Proposal 1: Approval of the Sale Pursuant to the Asset Purchase Agreement” and “Risks Related to the Sale” for further information.

Are there any risks related to the Sale?

Yes. You should carefully review the section entitled “Risk Factors” beginning on page 18 of this proxy statement for a description of risks related to the Sale.

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Proposed Dissolution of the Company

Why is SQZ seeking a stockholder vote on the Dissolution Proposal?

Under Article FIFTH of the Charter, the Company must obtain the approval of the holders of at least two-thirds in voting power of the Company’s outstanding shares of capital stock entitled to vote thereon before proceeding with a dissolution of the Company. The Board therefore is seeking stockholder approval of the Dissolution Proposal in order to comply with the Charter and Delaware law.

Why is the Board recommending approval of the Dissolution pursuant to the Plan of Dissolution?

The Board carefully reviewed and considered its options in light of the financial position of the Company, including our available cash, resources and operations following and in light of our previously announced review and pursuit of strategic alternatives. After due consideration of the options available to the Company, our Board has determined that the Dissolution pursuant to the Plan of Dissolution, is advisable and in the best interests of the Company and our stockholders. See “Proposal 2: Approval of the Dissolution Pursuant to the Plan of Dissolution - Reasons for the Proposed Dissolution.”

What does the Plan of Dissolution entail?

The Plan of Dissolution provides an outline of the steps for the Dissolution of the Company under Delaware law. The Plan of Dissolution provides that we will file the Certificate of Dissolution following stockholder approval of the Dissolution; however, the decision of whether or not to proceed with the Dissolution and when to file the Certificate of Dissolution will ultimately be made by the Board in its sole discretion and in its own timing.

What will happen if the Dissolution is approved?

If the Dissolution is approved by our stockholders, our Board will have sole discretion to determine if and when (at such time as they deem appropriate following stockholder approval of the Dissolution) to proceed with the Dissolution. If the Board decides to proceed with the Dissolution, we will follow the dissolution and winding-up procedures prescribed by the DGCL and Plan of Dissolution, which requires, among other things, that the Company file a Certificate of Dissolution.

If our Board determines that the Dissolution is not in our best interests or not in the best interests of our stockholders, our Board may direct that the Dissolution be abandoned, or may amend or modify the Plan of Dissolution to the extent permitted by Delaware law without the necessity of further stockholder approval. After the Certificate of Dissolution has been filed, revocation of the Dissolution would require stockholder approval under Delaware law.

Are there any risks related to the Dissolution?

Yes. You should carefully review the section entitled “Risk Factors” beginning on page 18 of this proxy statement for a description of risks related to the Dissolution.

Will I owe any U.S. federal income taxes as a result of the Dissolution?

If the Dissolution is approved and implemented, distributions made pursuant to the Plan of Dissolution are intended to be treated as received by a stockholder as a series of liquidating distributions and could result in a U.S. federal income tax liability to the stockholder. A stockholder that is a U.S. Holder (as defined in the section entitled “Certain Material U.S. Federal Income Tax Consequences of the Proposed Dissolution”) generally will recognize gain or loss on a share-by-share basis equal to the difference between (1) the sum of the amount of cash and the fair market value of property, if any,

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distributed to the U.S. Holder with respect to each share of our Common Stock, less any known liabilities assumed by the U.S. Holder or to which the distributed property (if any) is subject, and (2) the U.S. Holder’s adjusted tax basis in each share of our Common Stock. For a more detailed discussion, including with respect to Non-U.S. Holders (as defined below), see the section entitled “Certain Material U.S. Federal Income Tax Consequences of the Proposed Dissolution” beginning on page 58 of this proxy statement. Stockholders are urged to carefully review the discussion of tax matters within this proxy statement and to consult their tax advisors as to the specific tax consequences to them of the Dissolution.

What will happen to our Common Stock if the Certificate of Dissolution is filed with the Secretary of State of Delaware?

If the Certificate of Dissolution is filed with the Secretary of State, our Common Stock (if not previously deregistered) will be deregistered under the Exchange Act when we take action to do so. From and after the Effective Time, which we refer to as the effective time of the Certificate of Dissolution as filed with the Secretary of State of Delaware, and subject to applicable law, each holder of shares of our Common Stock shall cease to have any rights in respect of that stock, except the right to receive distributions, if any, pursuant to and in accordance with the Plan of Dissolution and the DGCL. After the Effective Time, our stock transfer records shall be closed, and we will not record or recognize any transfer of our Common Stock occurring after the Effective Time, except such transfers occurring by will, intestate succession or operation of law. Under the DGCL, no stockholder shall have any appraisal rights in connection with the Dissolution.

We expect to file the Certificate of Dissolution as soon as reasonably practicable after the Sale is consummated; however, the decision of whether or not to proceed with the Dissolution and the timing of such filing will be made by the Board in its sole discretion and in its own timing.

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PROPOSAL 1:  APPROVAL OF THE SALE PURSUANT TO THE ASSET PURCHASE AGREEMENT

General

In an effort to maximize stockholder value, the Board seeks to effect the sale of substantially all of the assets of the Company. In furtherance of these efforts, the Board is presenting the Sale Proposal (as defined below) for approval by the Company’s stockholders.

At the Special Meeting, you will be asked to consider and vote upon a proposal to approve the sale of substantially all of the assets of the Company (the “Sale”) pursuant to the Asset Purchase Agreement dated December 21, 2023, by and between the Company and the Purchaser, attached to this proxy statement as Appendix A (such agreement, the “Asset Purchase Agreement,” and such proposal the “Sale Proposal”), which was unanimously ratified and approved by the Board on December 18, 2023, subject to stockholder approval. The Board also unanimously recommended that our stockholders approve the Asset Purchase Agreement. Delaware law provides that a corporation may sell all or substantially all of its assets upon the recommendation of its board of directors, followed by the approval of its stockholders. At the Special Meeting, you will be asked to consider and vote upon the Sale Proposal to approve the Sale pursuant to the Asset Purchase Agreement. We encourage you to read the Asset Purchase Agreement in its entirety.

The Asset Purchase Agreement

Summary

The following is a summary of the key terms of the Asset Purchase Agreement. All capitalized, undefined terms used herein shall have the meanings ascribed to such terms in the Asset Purchase Agreement.

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The summary of selected information from this proxy statement regarding the Sale Proposal may not contain all of the information that is important to you. To understand the Sale Proposal and the Asset Purchase Agreement fully, we encourage you to read carefully this entire proxy statement, including, but not limited to, the Asset Purchase Agreement which is attached to this proxy statement as Exhibit A.

The Parties

The purchaser under the Asset Purchase Agreement is STEMCELL Technologies Canada Acquisitions Inc. (the “Purchaser”). The Purchaser is a British Columbia corporation formed on December 20, 2023, solely for the purpose of engaging in the transactions contemplated by the Asset Purchase Agreement, subject to the terms and conditions thereof. The Purchaser is a wholly owned subsidiary of STEMCELL Technologies Canada Inc. (“STEMCELL Parent”). STEMCELL Parent is engaged in the business of providing high-quality cell culture media, cell separation technologies, instruments, accessory products, and educational resources to scientists around the world working on stem cell, immunology, cancer, regenerative medicine, and cellular therapy research. STEMCELL Parent’s principal executive office is located at 1618 Station Street, Vancouver, British Columbia, Canada, V6A 1B6, and its website is: https://www.stemcell.com.

The seller under the Asset Purchase Agreement is the Company. The Company has historically been engaged in the business of developing cell therapies for patients with cancer and other serious medical conditions. The Company no longer has a physical principal executive office, but can be contacted at PO Box 5515, Wayland, Massachusetts 01778, and its website is: https://www.sqzbiotech.com.

As discussed earlier in this proxy statement, prior to the Company entering into the Asset Purchase Agreement, the Company and STEMCELL Parent were party to that certain License and Development Agreement, dated as of April 21, 2020, pursuant to which the Company granted to STEMCELL Parent an exclusive license to commercialize, in the research use only market, the Company’s Intracellular Delivery System, including microfluidic chip and reagent reservoir. STEMCELL Parent introduced the CELLPORE^TM Transfection System, a cell mechanoporation system for transfection and intracellular delivery, in 2023.

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Principal Terms and Conditions

The following is a summary of the principal terms and conditions of the Asset Purchase Agreement, which are further described under and qualified in their entirety by the full text of the Asset Purchase Agreement. Pursuant to the Asset Purchase Agreement, the parties agreed to, among other things, the following terms and conditions:

The Sale

The Company will sell, convey, transfer, assign and deliver to the Purchaser all of the Company’s right, title and interest in and to (i) all fixed assets and items of machinery, equipment, including laboratory equipment, and all other tangible personal property of the Company, (ii) the Company’s rights and obligations pursuant to the MIT License Agreement and the intellectual property licensed to the Company thereunder, (iii) all technology owned or licensed to the Company as of the date of the agreement, (iv) the Company’s rights and obligations pursuant to agreements with certain former employees (together with the MIT License Agreement, the “Transferred Contracts”) and (v) the intellectual property owned by the Company (collectively, the “Transferred Assets”). Certain assets of the Company are excluded from the Sale, including (A) the Investigational New Drug (“IND”) applications held by the Company, (B) any inventory related to the SQZ Clinical Product(s) or SQZ Therapeutic Product(s), including raw materials and other supplies therefor, (C) all cells owned or controlled by the Company, (D) all contracts other than the Transferred Contracts and (E) all cash and cash equivalents held by the Company. The only liabilities being assumed by the Purchaser are (I) post-Closing liabilities in connection with the Transferred Assets or use thereof and (II) post-Closing liabilities and obligations for taxes in respect of the Transferred Assets, in each case other than (x) any liability to the extent arising out of or relating to a breach by the Company of a Transferred Contract which occurred prior to the Closing or (y) any obligations required by any Transferred Contract to be performed prior to the Closing. The Purchaser will also assume any liabilities, fees or costs relating to, or arising out of, the transfer, conveyance, assumption, novation or assignment of the Transferred Assets (including, but not limited to, shipping, relocation and storage fees of the Transferred Assets pursuant to the Sale).

Consideration

The total cash consideration for the purchase and sale of the assets of the Company is $11,800,000. The purchase price is not subject to adjustment either before or after Closing, nor is any portion of the purchase price subject to an escrow holdback by the Purchaser.

Representations and Warranties of the Company

The Asset Purchase Agreement contains a number of representations and warranties of the Company to the Purchaser relating to, among other things: organization and qualification; power, authority and enforceability; no conflict; financial statements; title to transferred assets; no undisclosed liabilities; taxes; compliance with applicable laws and government authorizations; applicable health laws; claims and proceedings; the MIT License Agreement; officers and consultants; intellectual property; and brokers and finders.

The Company’s representations relating to organization, qualification, power, authority and enforceability, no conflict, title to transferred assets and brokers and finders constitute the Company’s fundamental representations.

Representations and Warranties of the Purchaser

The Asset Purchase Agreement contains a number of representations and warranties of the Purchaser to the Company relating to, among other things: organization, power, authority and enforceability; no conflict; claims and proceedings; brokers and finders and sufficiency of funds.

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Seller Covenants

The Asset Purchase Agreement contains a number of pre-Closing covenants of the Company to the Purchaser relating to, among other things:

The Asset Purchase Agreement also contains several post-Closing covenants of each of the Company and the Purchaser, including (i) the Company’s requirement to use commercially reasonable efforts to withdraw the INDs and close out the HPV Studies and (ii) the Purchaser’s grant of a limited license to the Company to use certain trademarks and domain names as the Company requires to wind down its business. Additionally, prior to Closing the Company is permitted to take such actions that are reasonably necessary or desirable to wind down its business, including by (A) resolving outstanding liabilities of the Company, (B) terminating or modifying any existing arrangement of any employee or consultant of the Company or (C) preparing to file a certificate of dissolution, or similar instrument, with the Secretary of State.

Mutual Covenants

The Asset Purchase Agreement contains a number of pre-Closing covenants of the Company and the Purchaser to the other party, relating to, among other things: certain tax matters; transfer taxes; confidentiality; public disclosures; fees and expenses; and providing further assurance as necessary to take actions for consummating the Sale pursuant to the Asset Purchase Agreement.

No-Shop

Until the Closing of the Sale or, if earlier, the termination of the Purchase Agreement, the Company will not, and will direct and use its commercially reasonable efforts to cause its representatives not to, (a) solicit, initiate, knowingly facilitate or knowingly encourage the submission of any proposal or offer that could reasonably be expected to lead to an Acquisition Proposal, (b) engage in, continue or otherwise participate in any discussions or negotiations regarding, or provide any non-public information or data relating to the Company or encourage any effort by, any third party that is seeking to make, or has made, an Acquisition Proposal, or (c) approve, support, adopt, endorse or recommend or enter into any agreement or other instruments (whether binding or not binding) with respect to an Acquisition Proposal.

If the Company receives a bona fide written acquisition proposal prior to the adoption of the Asset Purchase Agreement by its stockholders, the Board, following prompt notice of such proposal to the Purchaser, may

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(i) participate in negotiations or discussions with any third party that has made (and not withdrawn) a bona fide, unsolicited takeover proposal in writing that the Board believes in good faith, after consultation with outside legal counsel and its financial advisor, constitutes a “superior proposal;” (ii) thereafter furnish to such third party non-public information relating to the Company pursuant to an executed confidentiality agreement; and/or (iii) following receipt of and on account of a “superior proposal,” recommend the acceptance of such proposal.

The Board may make a recommendation adverse to the Sale, only if (i) the Company promptly notifies the Purchaser, in writing, at least 10 calendar days before making such an adverse recommendation or entering into an alternate acquisition agreement, of its intention to take such action with respect to a superior proposal, which notice shall state expressly that the Company has received a takeover proposal that the Board intends to declare a superior proposal and that the Board intends to effect an adverse recommendation and/or the Company intends to enter into an alternate acquisition agreement; (ii) the Company attaches to such notice the material terms and conditions of the transaction that constitutes such superior proposal and the identity of the third party making such superior proposal; (iii) the Company shall, and shall cause its representatives to, during such 10 calendar day notice period, negotiate with the Purchaser in good faith during such notice period with respect to such proposal to make such adjustments in the terms and conditions of the Asset Purchase Agreement so that the superior proposal described in such notice ceases to constitute a superior proposal (to the extent the Purchaser desires to negotiate); and (iv) the Board determines in good faith, after consulting with outside legal counsel and its financial advisor, that such takeover proposal continues to constitute a superior proposal after taking into account any adjustments made by the Purchaser during the notice period in the terms and conditions of the Asset Purchase Agreement.

Closing Conditions

The obligations of the Purchaser and the Company to consummate the Sale pursuant to the Asset Purchase Agreement and other transactions contemplated thereby, are subject to the satisfaction of the following conditions:

Non-Competition, Non-Solicitation and Non-Disparagement

Additionally, for two years following the Closing Date, the Company will be prohibited from directly or indirectly engaging in, investing in, owning, managing, operating, controlling, advising or rendering services to any person engaged in the business of mechanically opening cells for the intracellular delivery of cargo, however the Company may acquire or otherwise own less than 5% of the outstanding capital stock of any entity that is listed on any national securities exchange or is otherwise registered under U.S. securities laws.

During this period, the Company is also prohibited from directly or indirectly, knowingly causing, inducing or attempting to cause or induce any third party that was, as of the Closing Date, a consultant or independent contractor of the Company to terminate such relationship. The Company is also prohibited from publicly disparaging or otherwise defaming the Purchaser, the Company or the Company’s business.

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Termination Events and Termination Fee

The Asset Purchase Agreement may be terminated at any time prior to the Closing by:

The Company will pay to the Purchaser a termination fee of $360,000 in the event (a) the Company terminates upon the Board authorizing the Company to enter into an alternative transaction with respect to a superior proposal, or (b) the Purchaser terminates the Asset Purchase Agreement upon the Board’s change of recommendation.

Survival; Indemnification Obligations

The Company, on the one hand, and the Purchaser, on the other hand, have agreed to indemnify each other from and against losses the respective parties may incur arising out of breaches of the other party’s representations, warranties and covenants contained in the Asset Purchase Agreement, and the Purchaser has agreed to indemnify the Company for losses relating to any Assumed Liabilities, and the Company has agreed to indemnify the Purchaser for losses relating to the Excluded Assets and the Excluded Liabilities. All indemnification obligations of the parties under the Asset Purchase Agreement are subject to specified survival limitations, including the termination of such obligations upon the Company’s filing of a certificate of dissolution with the Delaware Secretary of State and other customary exceptions and limitations.

Except in the event of breaches of the Company’s fundamental representations, the aggregate amount of the Company’s liabilities for breaches of representations and warranties in the Asset Purchase Agreement shall not exceed $590,000. The amount of all losses arising out of or relates to breaches of any of the Company’s fundamental representations shall not exceed $11,800,000.

Reasons for the Sale Proposal

At its meeting on December 18, 2023, the Board determined that effecting the Sale pursuant to the Asset Purchase Agreement was advisable and fair to, and is in the best interests of, the Company and its stockholders and approved the Asset Purchase Agreement and the Sale. The Board considered at length potential strategic alternatives available to the Company, including an evaluation to identify available strategic alternatives and

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transactions involving the Company as a whole, such as a merger, reverse merger, sale of assets, strategic partnership or other business combination transaction, that would have a reasonable likelihood of providing value to our stockholders in excess of the amount, if any, the stockholders would receive in a liquidation. The Board believed that the Company engaged in a reasonable process to obtain the best available value for its stockholders and created an opportunity for other potentially interested parties to express interest in and negotiate a transaction with the Company. The Board considered that the Company actively sought offers from a broad range of potential financial and strategic investors on the sell side. Specifically, the Board noted that the Company’s financial advisor, Leerink Partners, had contacted 52 potential buyers and investors, of which five potential buyers signed non-disclosure agreements and five communicated an indication of interest with respect to a potential acquisition of the Company, as well as Leerink Partners’ verbal opinion that the purchase price contemplated by the Sale was fair to the Company from a financial perspective. For a more detailed discussion, see the section entitled “Introductory Summary — Background of Asset Sale and Dissolution” beginning on page 8 of this proxy statement. The Board recommends that our stockholders vote “FOR” approval of the Sale at the special meeting.

In reaching its decision to approve the Asset Purchase Agreement and to recommend that stockholders vote to approve the Sale, including the fairness of the consideration to be received in the Sale, the Board, in consultation with our advisors and management, considered a number of factors, including, but not limited to, the risk factors described elsewhere in this proxy statement or referred to herein, as well as the following factors:

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Our Board also considered potential drawbacks or risks relating to the Sale, including the following risks and potentially negative factors, but determined that these potential risks and factors were outweighed by the expected benefits of the Sale:

The foregoing discussion of the factors considered by the Board is not intended to be exhaustive, but rather includes material factors considered by the directors. The Board also considered other factors, including those described in the section entitled “Risks Related to the Sale” beginning on page 18 of this proxy statement, in deciding to approve, and unanimously recommending that our stockholders authorize, the Sale. In reaching its decision and recommendation to our stockholders, the Board did not quantify or assign any relative weights to the factors considered and individual directors may have given different weights to different factors. In addition, the Board did not undertake to make any specific determination as to whether any particular factor, or any aspect of any particular factor, was favorable or unfavorable to its ultimate determination, but rather conducted an overall analysis of the factors described above.

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Opinion of Our Independent Advisor

On December 18, 2023, Leerink Partners rendered its oral opinion, subsequently confirmed in writing, to the Board that, as of such date and based upon and subject to the foregoing, it is Leerink Partners’ opinion that the purchase price to be received by the Company in the Sale is fair, from a financial point of view, to the Company.

The Company retained Leerink Partners as its financial advisor in connection with the transactions contemplated by the Asset Purchase Agreement. The Asset Purchase Agreement provides for (i) the sale of all of the Company’s right, title and interest in the Transferred Assets and (ii) the payment by the Purchaser to the Company of $11.8 million in cash (the “Purchase Price”) and the agreement of the Purchaser to pay, perform or discharge the Assumed Liabilities (the actions in the foregoing clauses (i) and (ii), the “Transaction” and the Transferred Assets and the Assumed Liabilities, collectively the “Business”). In connection with this engagement, the Board requested that Leerink Partners evaluate the fairness, from a financial point of view, to the Company of the Purchase Price proposed to be paid to the Company pursuant to the terms of the Asset Purchase Agreement.

On December 18, 2023, Leerink Partners rendered to the Board its oral opinion, which was subsequently confirmed by delivery of a written opinion dated December 19, 2023, that, as of such date and based upon and subject to the various assumptions made, and the qualifications and limitations upon the review undertaken by Leerink Partners in preparing its opinion, the Purchase Price proposed to be paid to the Company pursuant to the terms of the Asset Purchase Agreement was fair, from a financial point of view, to the Company.

The full text of the written opinion of Leerink Partners, dated December 19, 2023, which sets forth, among other things, assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached to this proxy statement as Exhibit C. Leerink Partners’ opinion is directed to, and is solely for the benefit of the Board in connection with its consideration of the Asset Purchase Agreement and the opinion does not constitute advice or a recommendation as to how the Board or any stockholder should vote or act on any matter relating to the Asset Purchase Agreement. The Company’s stockholders are encouraged to read Leerink Partners’ opinion carefully and in its entirety. The following discussion of Leerink Partners’ written opinion is qualified in its entirety by reference to the full text of the written opinion of Leerink Partners, dated December 19, 2023, attached to this proxy statement as Exhibit C.

The full text of the written opinion of Leerink Partners, dated December 19, 2023, which describes the assumptions made, and the qualifications and limitations upon the review undertaken by Leerink Partners in preparing its opinion, is attached as Exhibit C to this proxy statement and is incorporated herein by reference. The summary of the written opinion of Leerink Partners set forth below is qualified in its entirety by the full text of the written opinion attached hereto as Exhibit C. Leerink Partners’ financial advisory services and opinion were provided for the information and assistance of the Board (in their capacity as directors and not in any other capacity) in connection with and for purposes of the Board’s consideration of the Transaction and the opinion of Leerink Partners addressed only the fairness, from a financial point of view, as of the date thereof, to the Company of the Purchase Price proposed to be paid to the Company pursuant to the terms of the Asset Purchase Agreement. The opinion of Leerink Partners did not address any other term or aspect of the Asset Purchase Agreement or the Transaction and does not constitute a recommendation to any stockholder of the Company as to whether or how such stockholder should vote or otherwise act with respect to the Transaction or any other matter.

The full text of the written opinion of Leerink Partners should be read carefully in its entirety for a description of the assumptions made, and the qualifications and limitations upon the review undertaken by Leerink Partners in preparing its opinion.

In connection with rendering the opinion described above and performing its related financial analyses, Leerink Partners reviewed, among other things:

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Leerink Partners also conducted discussions with members of the senior management and representatives of the Company regarding such Internal Data. The Company advised Leerink Partners that it did not have a standalone business plan and its plan in the absence of a sale or merger of the company was to pursue a dissolution of the Company, whether through an orderly liquidation and dissolution of the Company, or in a proceeding under the Federal Bankruptcy Code. In addition, Leerink Partners considered the results of its efforts on behalf of the Company to solicit, at the direction of the Company, indications of interest from third parties with respect to a possible acquisition of the Business or the Company or a business combination with the Company. Leerink Partners also conducted such other financial studies and analyses and took into account such other information as it deemed appropriate.

Leerink Partners assumed, without independent verification or any responsibility therefor, the accuracy and completeness of the financial, legal, regulatory, tax, accounting and other information supplied to, discussed with, or reviewed by Leerink Partners for purposes of its opinion and, with the Company’s consent, Leerink Partners relied upon such information as being complete and accurate. In that regard, Leerink Partners assumed, at the Company’s direction, that the Internal Data had been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the matters covered thereby and Leerink Partners relied, at the Company’s direction, on the Internal Data for purposes of its analysis and opinion. Leerink Partners expressed no view or opinion as to the Internal Data or the assumptions on which it was based. In addition, at the Company’s direction, Leerink Partners did not make any independent evaluation or appraisal of any of the assets or liabilities (contingent, derivative, off-balance-sheet or otherwise) of the Company, nor was Leerink Partners furnished with any such evaluation or appraisal, and Leerink Partners was not asked to conduct, and did not conduct, a physical inspection of the properties or assets of the Company. The Company advised Leerink Partners that consistent with the Dissolution Case, following consummation of the Transaction, the Company would effect an orderly liquidation and dissolution.

Leerink Partners assumed, at the Company’s direction, that the final executed Asset Purchase Agreement would not differ in any respect material to Leerink Partners’ analysis or its opinion from the last version of the Asset Purchase Agreement reviewed by Leerink Partners. Leerink Partners also assumed, at the Company’s direction, that the representations and warranties made by the Company and the Purchaser in the Asset Purchase Agreement were and would continue to be true and correct in all respects material to Leerink Partners’ analysis. Furthermore, Leerink Partners assumed, at the Company’s direction, that the Transaction would be consummated on the terms set forth in the Asset Purchase Agreement and in accordance with all applicable laws and other relevant documents or requirements, without delay or the waiver, modification or amendment of any term, condition or agreement, the effect of which would be material to Leerink Partners’ analysis or its opinion and that, in the course of obtaining the necessary governmental, regulatory and other approvals, consents, releases

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and waivers for the Transaction, no delay, limitation, restriction, condition or other change would be imposed, the effect of which would be material to Leerink Partners’ analysis or its opinion. Leerink Partners did not evaluate and did not express any opinion as to the solvency or fair value of the Company, or the Company’s ability to pay its obligations when they come due, or as to the impact of the Transaction on such matters, under any state, federal or other laws relating to bankruptcy, insolvency or similar matters. Leerink Partners is not a legal, regulatory, tax or accounting advisor, and Leerink Partners expressed no opinion as to any legal, regulatory, tax or accounting matters.

The opinion of Leerink Partners expressed no view as to, and did not address, the Company’s underlying business decision to proceed with or effect the Transaction, or the relative merits of the Transaction as compared to any alternative business strategies or transactions that might be available to the Company or in which the Company might engage. The opinion of Leerink Partners was limited to and addressed only the fairness, from a financial point of view, as of the date of the opinion, to the Company of the Purchase Price proposed to be paid to the Company pursuant to the terms of the Asset Purchase Agreement. Leerink Partners was not asked to, and Leerink Partners did not, express any view on, and its opinion did not address, any other term or aspect of the Asset Purchase Agreement or the Transaction, including, without limitation, the structure or form of the Transaction or any other agreements or arrangements contemplated by the Asset Purchase Agreement or entered into in connection with or otherwise contemplated by the Transaction, including, without limitation, the fairness of the Transaction or any other term or aspect of the Transaction to, or any consideration to be received in connection therewith by, or the impact of the Transaction on, the holders of any class of securities, creditors or other constituencies of the Company’s or any other party. In addition, Leerink Partners expressed no view or opinion as to the fairness (financial or otherwise) of the amount, nature or any other aspect of any compensation to be paid or payable to any of the officers, directors or employees of the Company or any other party, or class of such persons in connection with the Transaction, whether relative to the Purchase Price proposed to be paid to the Company pursuant to the terms of the Asset Purchase Agreement or otherwise. The opinion of Leerink Partners was necessarily based on financial, economic, monetary, currency, market and other conditions and circumstances as in effect on, and the information made available to Leerink Partners as of, the date of its written opinion, and Leerink Partners does not have any obligation or responsibility to update, revise or reaffirm its opinion based on circumstances, developments or events occurring after the date of the opinion. Leerink Partners’ opinion does not constitute a recommendation to any stockholder of the Company as to whether or how such stockholder should vote or otherwise act with respect to the Transaction or any other matter. Leerink Partners’ financial advisory services and its opinion were provided for the information and assistance of the Board (in their capacity as directors and not in any other capacity) in connection with and for purposes of their consideration of the Transaction. The issuance of the opinion of Leerink Partners was approved by the Leerink Partners Fairness Opinion Review Committee.

Summary of Financial Analyses

The following is a summary of the material financial analyses prepared by Leerink Partners and reviewed with the Board in connection with its opinion, which was delivered orally to the Board on December 18, 2023, and subsequently confirmed in Leerink Partners’ written opinion, dated December 19, 2023. For purposes of the analyses described below, Leerink Partners was directed to rely upon the Internal Data, including the Dissolution Case and the Bankruptcy Case. The summary set forth below does not purport to be a complete description of the financial analyses performed or factors considered by, and underlying the opinion of, Leerink Partners, nor does the order of the analyses described below represent the relative importance or weight given to those analyses by Leerink Partners. The preparation of a fairness opinion is a complex analytical process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances and, therefore, a fairness opinion is not readily susceptible to summary description. In arriving at its opinion, Leerink Partners did not draw, in isolation, conclusions from or with regard to any factor or analysis that it considered. Accordingly, Leerink Partners believes that its analyses must be considered as a whole and that selecting portions of such analyses and factors without considering all analyses and factors, could create a misleading or incomplete view of the processes underlying Leerink Partners’ financial analyses and its opinion.

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Any estimates contained in these analyses are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than as set forth below. The assumptions and estimates used in, and the results derived from, the financial analyses are inherently subject to substantial uncertainty. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before December 19, 2023, and is not necessarily indicative of current market conditions.

Leerink Partners was not requested to, and did not, recommend or determine the specific consideration payable in the Transaction. The type and amount of consideration payable in the Transaction was determined through negotiations between the Company and the Purchaser and the Company’s decision to enter into the Asset Purchase Agreement was solely that of the Board. The opinion of Leerink Partners was only one of many factors considered by the Board in their evaluation of the Transaction and should not be viewed as determinative of the views of the Board or the management of the Company with respect to the Transaction, the Purchase Price or any other aspect of the transactions contemplated by the Asset Purchase Agreement.

The summary set forth below does not purport to be a complete description of the financial analyses performed by, and underlying the opinion of, Leerink Partners. Future results may be different from those described and such differences may be material.

Analysis of Transaction Payments

The Company advised Leerink Partners that it did not have a standalone business plan and its plan in the absence of a sale or merger of the company was to pursue a dissolution of the Company, whether through an orderly liquidation and dissolution of the Company, or in a proceeding under the Federal Bankruptcy Code. Accordingly, Leerink Partners concluded, in the exercise of its professional judgment, that traditional valuation methodologies typically used for purposes of valuing a business as a going concern were not applicable to the Company. The Company’s management furnished to Leerink Partners the Dissolution Case and the Bankruptcy Case prepared by management and advised Leerink Partners, and Leerink Partners assumed at the direction of the Company that, consistent with the Dissolution Case, following consummation of the Transaction the Company would effect an orderly liquidation and dissolution. The Dissolution Case assumed an initial distribution of cash to holders of shares of the Company’s Common Stock as of March 31, 2024, of approximately $1.1 million, or approximately $0.037 per share based upon approximately 29.49 million shares outstanding as of December 12, 2023, excluding out-of-the-money and unvested options, as provided by the Company’s management, and a final distribution of cash to holders of shares as of March 31, 2027, of approximately $0.6 million. The initial distribution and the final distribution are referred to in this section as the “Transaction Payments.”

Leerink Partners calculated the present value of the Transaction Payments as of March 31, 2024 (the assumed date of approval by stockholders of the Company of a dissolution of the Company) by discounting the March 31, 2027 final distribution payment to March 31, 2024 using a discount rate equivalent to Moody’s Seasoned AAA Corporate Bond Yield of 4.75%, and adding that discounted amount to the amount of the initial distribution payment. Leerink Partners determined this discount rate based upon its professional expertise and judgment. This analysis resulted in an implied estimated present value as of March 31, 2024 of the final distribution of approximately $0.016 per Share, and an aggregate present value as of March 31, 2024 of approximately $0.053 per Share.

Leerink Partners then compared the results of the above analysis to the closing price of the Company’s Common Stock of $0.023 as of December 18, 2023.

Bankruptcy Case

The Company’s management furnished to Leerink Partners the Bankruptcy Case. As described in detail in see “Introductory Summary – Background of Asset Sale and Dissolution,” the Bankruptcy Case assumed that the

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Company would realize the same cash purchase price in a sale in bankruptcy, but that the Company would incur an additional approximately $2.6 million in expenses. Leerink Partners noted that, under the Bankruptcy Case, no proceeds would be available for distribution to stockholders of the Company.

General

Leerink Partners is a full-service securities firm engaged in securities trading and brokerage activities as well as investment banking and financial advisory services. Other than services in connection with the Transaction, for which Leerink Partners has received opinion fees of $750,000, in the past two years, Leerink Partners has not provided investment banking services to, or received compensation from, the Company. In the past two years, Leerink Partners has not provided investment banking services to, or received compensation from the Purchaser. In the ordinary course of business, Leerink Partners may, in the future, provide investment banking services to the Company, the Purchaser, or their respective affiliates and would expect to receive customary fees for the rendering of such services. In the ordinary course of its trading and brokerage activities, Leerink Partners has in the past and may in the future hold positions, for its own account or the accounts of its customers, in equity, debt or other securities of the Company, the Purchaser or their respective affiliates. Consistent with applicable legal and regulatory requirements, Leerink Partners has adopted policies and procedures to establish and maintain the independence of its research department and personnel. As a result, Leerink Partners’ research analysts may hold views, make statements or investment recommendations and/or publish research reports with respect to the Company, the Purchaser, and the Transaction and other participants in the Transaction that differ from the views of Leerink Partners’ investment banking personnel.

The Board selected Leerink Partners as a financial advisor in connection with the Transaction based on Leerink Partners’ longstanding relationship and familiarity with the Company and its business, as well as its experience and expertise in the pharmaceutical industry. Leerink Partners is an internationally recognized investment banking firm that has substantial experience in transactions similar to the Transaction.

In connection with Leerink Partners’ services as a financial advisor to the Company, the Company has agreed to pay Leerink Partners an aggregate fee of $3.0 million of which opinion fees of $750,000 have been paid and the remainder of which is payable contingent upon consummation of the Transaction. In addition, the Company has agreed to reimburse certain of Leerink Partners’ expenses arising, and to indemnify Leerink Partners against certain liabilities, including liabilities under federal securities laws, that may arise, out of Leerink Partners’ engagement. The terms of the fee arrangement between Leerink Partners and the Company, which are customary in transactions of this nature, were negotiated at arm’s length between Leerink Partners and the Board, and the Board was aware of the arrangement, including the fact that a significant portion of the fee payable to Leerink Partners is contingent upon the completion of the Transaction.

Disclaimer

This prospective financial information was not prepared with a view toward compliance with published guidelines of the SEC or the guidelines established by the American Institute of Certified Public Accountants for preparation or presentation of prospective financial information.

The Dissolution Case and the Bankruptcy Case included in this document has been prepared by, and is the responsibility of, the Company’s management. PricewaterhouseCoopers LLP has not audited, reviewed, examined, compiled nor applied agreed-upon procedures with respect to the accompanying Dissolution Case and the Bankruptcy Case and, accordingly, PricewaterhouseCoopers LLP does not express an opinion or any other form of assurance with respect thereto. The PricewaterhouseCoopers LLP report included in this document relates to the Company’s previously issued financial statements. It does not extend to the Dissolution Case and the Bankruptcy Case and should not be read to do so.

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Our Conduct Following Approval of the Sale Proposal

If the Sale Proposal is approved by the requisite vote of our stockholders, among other things as may be completed at such times as the Board or, if applicable, our officers, in accordance with Delaware law, deems necessary, appropriate or advisable in our best interests and the best interests of our stockholders, we will consummate the Sale pursuant to the Asset Purchase Agreement, and assuming the Dissolution Proposal is approved by the requisite vote of our stockholders, we will effect the Dissolution pursuant to the Plan of Dissolution, and file a certificate of dissolution with the Secretary of State of Delaware dissolving the Company, as further described below.

Amendment to the MIT Patent License Agreement

On December 21, 2023, the Company entered into a Second Amendment to the Amended and Restated Exclusive Patent License Agreement (the “Amendment”) with the Massachusetts Institute of Technology (“MIT”), which amended the MIT License Agreement. The Amendment was entered into in anticipation of the assignment of the MIT License Agreement to the Purchaser in connection with the Sale, and will be effective upon the Closing of the Asset Purchase Agreement, subject to the execution by the Purchaser of an assignment and assumption agreement in substantially the form attached to the Amendment. If these conditions are not met by April 30, 2024, then the Amendment shall terminate and will be considered null and void.

The Amendment, among other things, (i) modifies certain definitions and terms related to payment, indemnification, and running royalties (ii) requires the Company to develop and bring to market certain Licensed Products or Licensed Processes (each as defined in the MIT License Agreement), (iii) removes certain clinical milestones, and (iv) requires that the Company engage in certain development and commercialization activities using a Licensed Product or Licensed Process and manufactured under cGMP (as defined in the MIT License Agreement). In addition, under the Amendment, MIT waives and releases the Purchaser from any and all (i) financial obligations owed by the Company to MIT under the MIT License Agreement, and (ii) certain additional obligations owed by the Company to MIT under the MIT License Agreement, in each case, that arise on or before the Closing.

Interests of Certain Persons in the Sale

None of the Company’s officers, directors or consultants have any interest in, or will receive any special benefit from, the Sale.

Certain Material U.S. Federal Income Tax Consequences of the Sale Proposal

The following discussion is a general summary of certain material anticipated U.S. federal income tax consequences of the Sale. This summary is based upon the U.S. Internal Revenue Code of 1986, as amended (the “Code”), its legislative history, currently applicable and proposed Treasury regulations under the Code (the “Treasury Regulations”) and published rulings and decisions, all as currently in effect as of the date of this proxy statement, and all of which are subject to differing interpretations or change, possibly with retroactive effect. No ruling has been sought from the IRS with respect to any U.S. federal income tax consequences described below, and there can be no assurance that the IRS or a court will not take a contrary position. The following summary has no binding effect on the IRS or the courts. In addition, tax considerations under state, local, and non-U.S. laws, or federal laws other than those pertaining to income tax are not addressed in this summary. The proposed Sale by us is entirely a corporate action. Our stockholders will not realize any gain or loss for U.S. federal income tax purposes as a result of the Sale.

The proposed Sale will be treated as a sale of corporate assets in exchange for cash and the assumption of certain liabilities by the Purchaser. The amount of gain or loss we recognize with respect to the sale of a particular asset will be measured by the difference between the amount realized by us on the sale of that asset and our tax basis

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in that asset. The determination of whether we will recognize gain or loss will be made with respect to each of the assets to be sold. Accordingly, we may recognize gain on the sale of certain assets and loss on the sale of certain others, depending on the amount of consideration allocated to an asset as compared to the tax basis of that asset. Further, the sale of certain assets may result in ordinary income or loss, depending on the nature of the asset. We anticipate that our tax attributes, including any available U.S. federal net operating loss carry forwards (“NOLs”), will be available to reduce our U.S. federal income tax liability resulting from any gain realized by us as a result of the proposed Sale.

However, our ability to use our tax attributes to offset such gain may be subject to certain limitations. For example, our deduction for NOLs arising in taxable years beginning after December 31, 2017 is limited to 80% of current year taxable income, although our ability to use NOLs arising in taxable years beginning prior to January 1, 2018 is not so limited. In addition, in general, under Sections 382 and 383 of the Code, a corporation that undergoes an “ownership change”, generally defined as a greater than 50% change by value in its equity ownership by certain shareholders or groups of shareholders over a rolling three-year period, is subject to annual limitations on its ability to use its pre-ownership change NOLs or tax credit carryforwards to reduce future taxable income or income taxes. Our existing NOLs and tax credit carryforwards may be subject to limitations arising from previous ownership changes or future changes in our stock ownership, some of which might be beyond our control. Accordingly, the use of NOLs and tax credits may be subject to limitation under Sections 382 and 383 of the Code.

The determination of the amount of gain or loss we will recognize on the Sale and whether and to what extent our tax attributes will be available to reduce the gain, is complex and is based in part upon facts that will not be known until the completion of the Sale. It is possible that we will incur a U.S. federal income tax liability as a result of the proposed Sale.

STOCKHOLDERS ARE URGED TO REVIEW THIS DESCRIPTION CAREFULLY AND TO CONSULT THEIR TAX ADVISORS AS TO DETERMINE ANY SPECIFIC TAX CONSEQUENCES TO THE STOCKHOLDER IN CONNECTION WITH THE SALE, INCLUDING, ANY U.S. FEDERAL INCOME TAX CONSEQUENCES AND/OR ANY OTHER U.S. FEDERAL TAX CONSEQUENCES, AND ANY STATE, LOCAL OR NON-U.S. TAX CONSEQUENCES RELEVANT TO SUCH STOCKHOLDER AS A RESULT OF THE SALE PURSUANT TO THE ASSET PURCHASE AGREEMENT.

Accounting Treatment of the Sale

The Sale will be accounted for as a “sale” by the Company, as that term is used under generally accepted accounting principles, for accounting and financial reporting purposes.

No Appraisal or Dissenters’ Rights

Our stockholders may vote against the authorization of the Sale Proposal, but under Delaware law, appraisal or dissenters’ rights are not provided to stockholders in connection with the Sale.

Required Vote

Under the Charter, the affirmative vote of the holders of at least two-thirds in voting power of the Company’s outstanding shares of capital stock entitled to vote on the Sale Proposal is required to approve the Sale Proposal. Abstentions and broker non-votes, if any, will have the effect of a vote against the Sale Proposal.

Recommendation of the Board

After careful consideration and evaluation of the Sale, and in consideration of, among other things, the opinion of Leerink Partners that, based upon and subject to the factors and assumptions set forth in such opinion, the

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consideration to be received by the Company in the Sale, is fair, from a financial point of view, to the Company, our Board unanimously (i) determined that the Sale pursuant to the Asset Purchase Agreement and the other transactions contemplated thereby are fair, advisable and in the best interests of the Company and its stockholders, and (ii) approved in all respects the Sale and the Asset Purchase Agreement and the other transactions contemplated thereby.

The Board unanimously recommends that you vote “FOR” the Sale Proposal.

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PROPOSAL 2: APPROVAL OF THE DISSOLUTION PURSUANT TO THE PLAN OF DISSOLUTION

Our Board has (i) determined that the Dissolution is advisable and in the best interests of the Company and our stockholders, (ii) approved the Dissolution and (iii) adopted the Plan of Dissolution. The reasons for the Dissolution are described under “Introductory Summary – Background of Asset Sale and Dissolution” beginning on page 8 of this proxy statement. The Dissolution requires approval by the holders of at least two-thirds in voting power of the Company’s outstanding shares of capital stock entitled to vote on the Dissolution Proposal. Our Board unanimously recommends that our stockholders authorize the Dissolution.

In general terms, when we dissolve, we will cease conducting our business, wind up our affairs, dispose of any remaining non-cash assets, pay or otherwise provide for our obligations, and distribute our remaining assets, if any, during a winding-up period of at least three years, as required by the DGCL. With respect to the Dissolution, we will follow the liquidation, dissolution and winding-up procedures prescribed by the DGCL and our Plan of Dissolution, as described in further detail under “Proposal 2 - Approval of the Dissolution Pursuant to the Plan of Dissolution - Delaware Law Applicable to Our Dissolution” beginning on page 48 of this proxy statement. You should carefully consider the risk factors relating to our complete liquidation and dissolution as described under “Risk Factors - Risks Related to the Dissolution” beginning on page 19 of this proxy statement.

Subject to the requirements of the DGCL and our Plan of Dissolution described in this proxy statement, we will use our existing cash to pay for our winding-up procedures, including:

Distributions to Stockholders

Distributions, if any, to our stockholders may be paid in one or more distributions. Notwithstanding the analysis in the Dissolution Case and the Bankruptcy Case, we cannot be certain that any amounts will remain available for distribution to stockholders in the course of the Dissolution process. However, should funds be available for distribution, we estimate that stockholders would receive approximately 3.3 cents per share of the Company’s outstanding Common Stock for each $1 million available for distribution. We cannot predict the timing or amount of any such distributions, as uncertainties as to the ultimate amount of our liabilities, the operating costs and amounts to be set aside for claims, obligations and provisions during the liquidation and winding-up process, and the related timing to complete such transactions make it challenging to predict with certainty the actual net cash amount that will ultimately be available for distribution to stockholders or the timing of any such distributions. Examples of uncertainties that could reduce the value of distributions, if any, to our

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stockholders include, without limitation: unanticipated costs relating to the defense, satisfaction or settlement of existing or future lawsuits or other claims threatened against us or our officers or directors (including currently unknown claims); amounts necessary to resolve claims of our creditors; and delays in the liquidation and dissolution or other winding up of our subsidiaries due to our inability to settle claims or otherwise.

Amounts, if any, we will be able to distribute to our stockholders in liquidation are subject to change and outside of our control. While we intend to pursue matters related to our liquidation and winding up as quickly as possible if we obtain approval from our stockholders, the timing of many elements of this process after our Dissolution will not be entirely within our control and, therefore, we are unable to estimate when we would be able to begin making any post-Dissolution liquidating distributions to our stockholders. See the section entitled “Risk Factors — Risks Related to the Dissolution” beginning on page 19 of this proxy statement.

Reasons for the Proposed Dissolution

The Board believes that the Dissolution is in SQZ’s best interests and the best interests of our stockholders. The Board considered and pursued at length potential strategic alternatives available to SQZ such as a merger, asset sale, strategic partnership or other business combination transaction, and, following the results of such review, now believes that the Sale and the subsequent winding-up of the Company in accordance with the Plan of Dissolution is in the best interests of SQZ and its stockholders. We believe these transactions will maximize any possible residual value for our stockholders.

In making its determination to approve the Dissolution, the Board considered, in addition to other pertinent factors, the fact that SQZ currently has insufficient business operations or business prospects to fund continued operations and outstanding liabilities; and the fact that SQZ will continue to incur substantial accounting, legal and other expenses associated with being a public company despite having no source of revenue or financing alternatives. See “Introductory Summary – Background of Asset Sale and Dissolution” for additional information. As a result of its evaluation, the Board concluded that the Dissolution is the preferred strategy among the limited alternatives now available to SQZ and is in the best interests of SQZ and its stockholders. Accordingly, the Board approved the Dissolution of SQZ pursuant to the Plan of Dissolution and recommends that our stockholders approve the Dissolution Proposal. See “Proposal 2: Approval of the Dissolution Pursuant to the Plan of Dissolution - Sale of Our Remaining Assets.”

Delaware Law Applicable to our Dissolution

We are a corporation organized under the laws of the State of Delaware and the Dissolution will be governed by the DGCL. The following is a brief summary of some of the DGCL provisions applicable to the Dissolution. The following summary is qualified in its entirely by Sections 275 through 283 of the DGCL, which are attached to this proxy statement as Annex A.

Delaware Law Generally

Authorization of Board and Stockholders. If a corporation’s board of directors deems it advisable that the corporation should dissolve, it may adopt a resolution to that effect by a majority vote of the whole board and notify the corporation’s stockholders entitled to vote on the dissolution of the adoption of the resolution and the calling of a meeting of stockholders to act on the resolution. Our Board has unanimously adopted a resolution approving the Dissolution and the Plan of Dissolution and declaring them advisable and recommending them to our stockholders. Under our Charter, the Dissolution must be authorized and approved by the holders of at least two-thirds in voting power of the Company’s outstanding shares of capital stock entitled to vote on the Dissolution Proposal.

Certificate of Dissolution. If a corporation’s stockholders authorize its dissolution, the dissolution will only be effective once the corporation files a certificate of dissolution with the Secretary of State. If our stockholders

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authorize the Dissolution at the Special Meeting, we intend to file the Certificate of Dissolution with the Secretary of State as soon as practicable after the receipt of such approval. However, both the timing of such filing and whether or not to proceed with the Dissolution is subject to the discretion of the Board.

Possible Permitted Abandonment of Dissolution. The resolution authorizing a dissolution adopted by a corporation’s board of directors may provide that, notwithstanding authorization of the dissolution by the corporation’s stockholders, the board of directors may abandon the dissolution without further action by the stockholders. While we do not currently foresee any reason that our Board would abandon the Dissolution once it is authorized by our stockholders, to provide our Board with the maximum flexibility to act in the best interests of our stockholders, the resolutions adopted by our Board and the Plan of Dissolution included language providing the Board with the flexibility to abandon the Dissolution without further action of our stockholders at any time prior to the filing of the Certificate of Dissolution.

Time of Dissolution. When a corporation’s certificate of dissolution is filed with the Secretary of State and has become effective, along with the corporation’s tender of all relevant taxes (including Delaware franchise taxes) and fees authorized to be collected by the Secretary of State, the corporation will be dissolved.

Continuation of Corporation After Dissolution

A dissolved corporation continues its existence for three years after dissolution, or such longer period as the Delaware Court of Chancery may direct, for the purpose of prosecuting and defending suits and enabling the corporation to settle and close its business, to dispose of and convey its property, to discharge its liabilities and to distribute to its stockholders any remaining assets. A dissolved corporation may not, however, continue the business for which it was organized. Any action, suit or proceeding begun by or against the corporation before or during the Survival Period (as defined below) does not abate by reason of the dissolution, and for the purpose of any such action, suit or proceeding, the corporation will continue beyond the Survival Period until any related judgments, orders or decrees are fully executed, without the necessity for any special direction by the Delaware Court of Chancery. Our Plan of Dissolution will govern our winding up process after Dissolution. See the section entitled “Our Plan of Dissolution” beginning on page 52.

Payment and Distribution to Claimants and Stockholders

A dissolved corporation must make provision for the payment (or reservation of funds as security for payment) of claims against the corporation in accordance with the applicable provisions of the DGCL and the distribution of remaining assets to the corporation’s stockholders. The dissolved corporation may do this by following one of two procedures, as described below.

Safe Harbor Procedures under DGCL Sections 280 and 281(a)(the “Safe Harbor Procedures”)

A dissolved corporation may elect to give notice of its dissolution to persons having a claim against the corporation (other than claims against the corporation in any pending actions, suits or proceedings to which the corporation is a party) (“Current Claimants”) and to persons with contractual claims contingent on the occurrence or nonoccurrence of future events or otherwise conditional or unmatured (“Contingent Contractual Claimants”), and after giving these notices, following the procedures set forth in the DGCL, as described below.

The Plan of Dissolution provides the Board with the discretion to elect to follow the Safe Harbor Procedures rather than the Alternative Procedures (as defined below).

Current Claimants

Notices and Publication. The notice to Current Claimants must state (1) that all such claims must be presented to the corporation in writing and must contain sufficient information that will reasonably inform the

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corporation of the identity of the claimant and the substance of the claim; (2) the mailing address to which the claim must be sent; (3) the date (the “Claim Date”) by which the claim must be received by the corporation, which must be no earlier than 60 days from the date of the corporation’s notice; (4) that the claim will be barred if not received by the Claim Date; (5) that the corporation may make distributions to other claimants and the corporation’s stockholders without further notice to the Current Claimant; and (6) the aggregate annual amount of all distributions made by the corporation to its stockholders for each of the three years before the date of dissolution. The notice must be published at least once a week for two consecutive weeks in a newspaper of general circulation in the county in which the corporation’s registered agent in Delaware is located and in the corporation’s principal place of business and, in the case of a corporation having $10 million or more in total assets at the time of dissolution, at least once in all editions of a daily newspaper with a national circulation. On or before the date of the first publication of the notice, the corporation must also mail a copy of the notice by certified or registered mail, return receipt requested, to each known claimant of the corporation, including persons with claims asserted against the corporation in a pending action, suit or proceeding to which the corporation is a party.

Effect of Non-Responses to Notices. If the dissolved corporation does not receive a response to the corporation’s notice by the Claim Date from a Current Claimant who was given actual notice according to the foregoing paragraph, then the claimant’s claim will be barred.

Treatment of Responses to Notices. If the dissolved corporation receives a response to the corporation’s notice by the Claim Date, the dissolved corporation may accept or reject, in whole or in part, the claim. If the dissolved corporation rejects a claim, it must mail a notice of the rejection to the Current Claimant by certified or registered mail, return receipt requested, within 90 days after receipt of the claim (or, if earlier, at least 150 days before the expiration of the Survival Period). The notice must state that any claim so rejected will be barred if the Current Claimant does not commence an action, suit or proceeding with respect to the claim within 120 days of the date of the rejection.

Effect of Non-Responses to Rejections of Claims. If the dissolved corporation rejects a claim and the Current Claimant does not commence an action suit or proceeding with respect to the claim within the 120-day post-rejection period, then the Current Claimant’s claim will be barred.

Contingent Contractual Claims

Notices. The notice to Contingent Contractual Claimants (persons with contractual claims contingent on the occurrence or nonoccurrence of future events or otherwise conditional or unmatured) must be in substantially the same form and sent and published in the same manner, as notices to Current Claimants and shall request that Contingent Contractual Claimants present their claims in accordance with the terms of such notice.

Responses to Contractual Claimants. If the dissolved corporation receives a response by the date specified in the notice by which the claims from Contingent Contractual Claimants must be received by the corporation, which must be no earlier than 60 days from the date of the corporation’s notice to Contingent Contractual Claimants, the dissolved corporation must offer to the Contingent Contractual Claimant such security as the dissolved corporation determines is sufficient to provide compensation to the claimant if the claim matures. This offer must be mailed to the Contingent Contractual Claimant by certified or registered mail, return receipt requested, within 90 days of the dissolved corporation’s receipt of the claim (or, if earlier, at least 150 days before the expiration of the post-dissolution survival period). If the Contingent Contractual Claimant does not deliver to the dissolved corporation a written notice rejecting the offer within 120 days after receipt of the offer for security, the claimant is deemed to have accepted the security as the sole source from which to satisfy the claim against the dissolved corporation.

Determinations by Delaware Court of Chancery

A dissolved corporation that has complied with the Safe Harbor Procedures must petition the Delaware Court of Chancery to determine the amount and form of security that will be (1) reasonably likely to be sufficient

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to provide compensation for any claim against the dissolved corporation that is the subject of a pending action, suit or proceeding to which the dissolved corporation is a party, other than a claim barred pursuant to the Safe Harbor Procedures, (2) sufficient to provide compensation to any Contingent Contractual Claimant who has rejected the dissolved corporation’s offer for security for such person’s claims made pursuant to the Safe Harbor Procedures, and (3) reasonably likely to be sufficient to provide compensation for claims that have not been made known to the dissolved corporation or that have not arisen but that, based on facts known to the dissolved corporation, are likely to arise or to become known to the dissolved corporation within five years after the date of dissolution or such longer period of time as the Delaware Court of Chancery may determine, not to exceed ten years after the date of dissolution.

Payments and Distributions

If a dissolved corporation has followed the Safe Harbor Procedures, then it will (1) pay the current claims made but not rejected, (2) post the security offered and not rejected for contractual claims that are contingent, conditional or unmatured, (3) post any security ordered by the Delaware Court of Chancery in response to the dissolved corporation’s petition to the court described above, and (4) pay or make provision for all other claims that are mature, known and uncontested or that have been finally determined to be owing by the dissolved corporation. If there are insufficient assets to make these payments and provisions, then they will be satisfied ratably in accordance with legal priorities, to the extent that assets are available.

All remaining assets will be distributed to the dissolved corporation’s stockholders, but not earlier than 150 days after the date of the last notice of rejection given by the dissolved corporation to a Current Claimant pursuant to the Safe Harbor Procedures.

Alternative Procedures under DGCL Section 281(b) (the “Alternative Procedures”)

If a dissolved corporation does not elect to follow the Safe Harbor Procedures, it must adopt a plan of distribution pursuant to which it will (1) pay or make reasonable provision to pay all claims and obligations, including all contingent, conditional or unmatured contractual claims known to the corporation, (2) make such provision as will be reasonably likely to be sufficient to provide compensation for any claim against the dissolved corporation that is the subject of a pending action, suit or proceeding to which the dissolved corporation is a party and (3) make such provision as will be reasonably likely to be sufficient to provide compensation for claims that have not been made known to the dissolved corporation or that have not arisen but that, based on facts known to the dissolved corporation, are likely to arise or to become known to the dissolved corporation within ten years after the date of dissolution. If there are insufficient assets to make these payments and provisions, then they will be satisfied ratably in accordance with legal priorities, to the extent assets are available. All remaining assets will be distributed to the dissolved corporation’s stockholders.

The Plan of Dissolution adopted by the Board and proposed to the stockholders for approval constitutes the plan of distribution for purposes of the Alternative Procedures. The Board currently anticipates dissolving SQZ in accordance with the Alternative Procedures, but retains the discretion to elect to follow the Safe Harbor Procedures.

Liabilities of Stockholders and Directors

If a dissolved corporation follows either the Safe Harbor Procedures or the Alternative Procedures, then (1) a stockholder of the dissolved corporation’s will not be liable for any claim against the dissolved corporation in an amount in excess of the lesser of (a) the stockholder’s pro rata share of the claim and (b) the amount distributed to the stockholder. If a dissolved corporation follows the Safe Harbor Procedures, then a stockholder of the dissolved corporation will not be liable for any claim against the dissolved corporation pursuant to any action, suit or proceeding that is not begun before the expiration of the Survival Period. In no event will the aggregate liability of a stockholder of a dissolved corporation for claims against the dissolved corporation exceed

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the amount distributed to the stockholder in dissolution. If a dissolved corporation fully complies with either the Safe Harbor Procedures or the Alternative Procedures, then the dissolved corporation’s directors will not be personally liable to the dissolved corporation’s claimants.

Application of These Procedures to Us

We currently plan to elect to follow the Alternative Procedures. However, our Plan of Dissolution provides our Board with the discretion to decide to instead follow the Safe Harbor Procedures.

Our Plan of Dissolution

The Dissolution will be conducted in accordance with the Plan of Dissolution, which is attached to this proxy statement as Exhibit B and incorporated by reference into this proxy statement. The following is a summary of our Plan of Dissolution and does not purport to be complete or contain all of the information that is important to you. To understand our Plan of Dissolution more fully, you are urged to read this proxy statement as well as the Plan of Dissolution. Our Plan of Dissolution may be modified, clarified or amended by action of our Board at any time and from time to time, as further described below.

Authorization and Effectiveness

Our Plan of Dissolution will be deemed approved if the holders of at least two-thirds in voting power of the Company’s outstanding shares of capital stock entitled to vote on the Dissolution Proposal approve the Dissolution Proposal and will constitute our authorized plan of distribution pursuant to Section 281(b) of the DGCL and will evidence our authority to take all actions described in the Plan of Dissolution. Following the authorization of the Dissolution by our stockholders, at such time as our Board determines to be appropriate, we will file the Certificate of Dissolution with the Secretary of State and ensure that all relevant taxes (including Delaware franchise taxes) and fees authorized to be collected by the Secretary of State are paid. The Effective Time will be when the Certificate of Dissolution is filed with the office of the Secretary of State or such later date and time that is stated in the Certificate of Dissolution.

Survival Period

For three years after the Effective Time (or such longer period as the Delaware Court of Chancery may direct) (the “Survival Period”), we will continue as a body corporate for the purpose of prosecuting and defending lawsuits (civil, criminal or administrative) by or against us; settling and closing our business; disposing of and conveying our property; discharging our liabilities in accordance with the DGCL; and distributing our remaining assets to our stockholders. We will no longer engage in the development of cell therapies or the treatment of patients in our enhanced antigen presenting cell (eAPC) and activating antigen carriers (AAC) programs in HPV16+ tumors, except to the extent necessary to preserve the value of our assets and wind up our business affairs in accordance with our Plan of Dissolution. We anticipate that distributions, if any, to our stockholders will be made in cash, and may be made at any time, from time to time, in accordance with the DGCL.

General Liquidation, Winding Up and Distribution Process

We intend to elect to follow the Alternative Procedures described under the section entitled “Alternative Procedures under DGCL Section 281(b)” beginning on page 51 of this proxy statement but our Board retains the discretion to opt to dissolve the Company in accordance with the Safe Harbor Procedures.

Continuing Officers and Consultants

During the Survival Period, we may retain, hire, employ or contract with employees, consultants, agents, trustees, independent professional advisors (including legal counsel, accountants and financial advisors) and

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others, as the Board may determine, from time to time, to be necessary or advisable to effect the Dissolution as described in our Plan of Dissolution. The Board expects that during the Dissolution, Lawrence Knopf, Richard Capasso and David Nyero Nyeko, among others, will continue as consultants of the Company, and the Company will retain Michael Jacoby of Phoenix Management as Chief Restructuring Officer, to help with the winding-up activities and administering the Dissolution. The Board also expects that outside legal and financial advisors will continue to advise on and assist with the Dissolution.

After filing the Certificate of Dissolution, the Board expects it will reduce the size of the Board to save costs.

We may, in the absolute discretion of the Board, pay the Company’s officers and directors, any employees it may hire, consultants, agents and other representatives, compensation or additional compensation above their regular compensation, including pursuant to severance and retention agreements, in money or other property, in recognition of the extraordinary efforts they will be required to undertake in connection with the implementation of the Plan of Dissolution; however, given the Company’s already streamlined operations, the Board does not expect to need to hire any employees or otherwise expand the team of advisors and consultants currently in place.

Sale of Our Remaining Assets

Following the proposed Sale, we do not believe that any of our remaining non-cash assets will be material. Therefore, the Plan of Dissolution contemplates the sale of all of our remaining non-cash assets if and at such time as the Board may approve, without further stockholder approval, subject to the Sale, if approved by stockholders. The Plan of Dissolution does not specify the manner in which we may sell our assets. Such sales could take the form of sales of individual assets, sales of groups of assets organized by type of asset or otherwise, a single sale of all or substantially all of our assets, or some other form of sale. The assets may be sold to one or more purchasers in one or more transactions over a period of time. It is not anticipated that any further stockholder votes will be solicited with respect to the approval of the specific terms of any particular sales of assets approved by the Board. We do not anticipate amending or supplementing this proxy statement to reflect any such agreement or sale, unless required by applicable law, or selling any additional assets in the future. See the section of this proxy statement captioned “Risks Related to the Dissolution.”

Costs and Expenses

We will pay all costs and expenses that the Board may determine from time to time to be necessary or advisable to effect the Dissolution in accordance with the Plan of Dissolution and as may be necessary or advisable to continue our existence and operations. These costs and expenses may include, without limitation, brokerage, agency, professional, consulting and other fees and expenses of persons rendering services to the Company in connection with the matters described in the Plan of Dissolution and costs incurred to comply with contracts to which the Company is a party.

Indemnification

We will continue to indemnify our current and former officers, directors, employees, consultants and agents in accordance with, and to the extent required or permitted by, the DGCL, our Charter, our Amended and Restated Bylaws (the “Bylaws”) and any contractual arrangements, whether these arrangements existed before the Dissolution or were entered into after the Dissolution. During the Survival Period, acts and omissions of any indemnified or insured person in connection with the implementation of the Plan of Dissolution will be covered to the same extent that they were covered before the Effective Time. The Board is authorized to obtain and maintain insurance as may be necessary to cover the Company’s indemnification obligations, including seeking an extension in time and coverage of our insurance policies currently in effect.

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Stockholder Approval

Authorization of the Dissolution by the holders of at least two-thirds in voting power of the outstanding shares of capital stock of the Company entitled to vote thereon shall, to the fullest extent permitted by law, constitute approval of all matters described in this proxy statement relating to the Dissolution, including our Plan of Dissolution.

Authorization of the Dissolution by the holders of at least two-thirds in voting power of the outstanding capital stock of the Company entitled to vote thereon shall constitute the authorization of the sale, exchange or other disposition in liquidation of all of the remaining property and assets of the Company after the Effective Time, whether the sale, exchange or other disposition occurs in one transaction or a series of transactions, and shall constitute ratification of any and all contracts for sale, exchange or other disposition that are conditioned on stockholder approval. We note that we have not solicited, and do not intend to solicit, affiliates to purchase our assets as part of the Plan of Dissolution. The Plan of Dissolution is not intended as a “going private transaction” within the meaning of Rule 13e-3 under the Exchange Act. In the event that our plans change, and we engage in a transaction identified in Rule 13e-3 with an affiliate, we would comply with the requirements of Rule 13e-3, including filing a Schedule 13e-3.

Subsidiaries

As part of the Dissolution, we may take actions with respect to our direct and indirect subsidiaries, in accordance with the requirements of the laws and charter documents governing each subsidiary, to liquidate, dissolve and wind up or otherwise dispose of each such subsidiary.

Legal Claims

We will defend any claims against us, our officers or directors or our subsidiaries, whether a claim exists before the Effective Time or is brought during the Survival Period, based on advice and counsel of our legal and other advisors and in such manner, at such time and with such costs and expenses as our Board may approve from time to time. During the Survival Period, we may continue to prosecute any claims that we had against others before the Effective Time and may institute any new claims against any person as the Board may determine necessary or advisable to protect the Company and its assets and rights or to implement the Plan of Dissolution. At the Board’s discretion, we may defend, prosecute or settle any lawsuits, as applicable.

Effective Time; Stock of the Company

The Effective Time will be the time the Certificate of Dissolution is filed with the office of the Secretary of State or such later date and time that is stated in the Certificate of Dissolution.

From and after the Effective Time, and subject to applicable law, each holder of shares of our Common Stock shall cease to have any rights in respect of that stock, except the right to receive distributions, if any, pursuant to and in accordance with the Plan of Dissolution and the DGCL. After the Effective Time, our stock transfer records shall be closed, and we will not record or recognize any transfer of our Common Stock occurring after the Effective Time, except such transfers occurring by will, intestate succession or operation of law. We expect the Effective Time to be as soon as reasonably practicable after the Dissolution is approved by our stockholders, but our Board may, in its sole discretion, decide to delay the filing or not file the Certificate of Dissolution, thus delaying the Effective Time accordingly. No stockholder shall have any appraisal rights in connection with our Dissolution and winding-up.

Unclaimed Distributions

If any distribution to a stockholder cannot be made, whether because the stockholder cannot be located, has not surrendered a certificate evidencing ownership of the Company’s Common Stock or provided other evidence

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of ownership as required in the Plan of Dissolution or by the Board or for any other reason, the distribution to which the stockholder is otherwise entitled will be transferred, at such time as the final liquidating distribution is made by us, or as soon as practicable after that distribution, to the official of such state or other jurisdiction authorized by applicable law to receive the proceeds of the distribution. The proceeds of such distribution will thereafter be held solely for the benefit of and for ultimate distribution to the stockholder as the sole equitable owner of the distribution and will be treated as abandoned property and escheat to the applicable state or other jurisdiction in accordance with applicable law. The proceeds of any such distribution will not revert to or become the property of the Company or any of its stockholders.

Liquidating Trust

While we do not currently propose transferring our assets to a liquidating trust, we may do so if deemed appropriate by our Board. We may, for example, transfer assets to a liquidating trust if we are unable to complete the Dissolution within the initial three-years of the Survival Period.

Abandonment, Exceptions, Modifications, Clarifications and Amendments

Notwithstanding the authorization of the Dissolution by our stockholders as described in this proxy statement, our Board will have the right, as permitted by the DGCL, the resolutions of the Board recommending the Dissolution to the stockholders for approval and the Plan of Dissolution, to abandon the Dissolution at any time before the Effective Time and terminate our Plan of Dissolution, without any action by our stockholders. Without further action by our stockholders, our Board may, to the extent permitted by Delaware law, waive, modify or amend any part of our Plan of Dissolution, and may provide for exceptions to or clarifications of the terms of our Plan of Dissolution. After the Effective Time, revocation of the Dissolution would require stockholder approval under Delaware law.

Contingent Liabilities; Reserves

Under Delaware law, we are required, in connection with the Dissolution, to pay or make reasonable provision for payment of our liabilities and obligations. We will pay all of our expenses (including operating and wind-up expenses to be incurred throughout the Dissolution and wind-up process) and other known, non-contingent liabilities. We have used and anticipate continuing to use cash until the end of the Survival Period for a number of items, including, but not limited to, the following:

We will maintain a reserve, consisting of cash or other assets that we believe will be adequate for the satisfaction of all of our current unknown, contingent and/or conditional claims and liabilities. We may also take other steps to provide for the satisfaction of the reasonably estimated amount of such claims and liabilities, including acquiring insurance coverage with respect to certain claims and liabilities.

The estimated amount of a reserve (if any) would be based upon certain estimates and assumptions and a review of our estimated operating expenses and future estimated liabilities, including, without limitation, estimated operating costs, directors’ and officers’ insurance, legal, accounting and consulting fees and miscellaneous expenses, and accrued expenses reflected in our financial statements. There can be no assurance that the reserve will be sufficient. If any of our estimates regarding the expenses to be incurred in the liquidation process, including expenses of personnel required and other operating expenses (including legal, accounting and

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consulting fees) necessary to dissolve and liquidate the Company and the expenses to satisfy outstanding obligations, liabilities and claims during the liquidation process, are inaccurate, we may be required to increase the amount of the reserve. After the liabilities, expenses and obligations for which the reserve is established have been satisfied in full (or determined not to be owed), we intend to distribute to our stockholders any remaining portion of the reserve.

In the event we fail to create an adequate reserve for the payment of our expenses and liabilities and amounts have been distributed to the stockholders under the Plan of Dissolution, our creditors may be able to pursue claims against our stockholders directly to the extent that they have received liquidating distributions from us in the Dissolution. See the section entitled “Risk Factors — Risks Related to the Dissolution — Our stockholders may be liable to third parties for part or all of the amount received from us in our liquidating distributions if reserves are inadequate” beginning on page 21 of this proxy statement.

If it was determined by a court that we failed to make adequate provision for our expenses and liabilities or if the amount required to be paid in respect of such liabilities exceeded the amount available from the reserve and any assets of the liquidating trust or trusts, a creditor of ours could seek an injunction against the making of liquidating distributions under the Plan of Dissolution on the grounds that the amounts to be distributed were needed to provide for the payment of our expenses and liabilities. Any such action could delay or substantially diminish the cash distributions to be made to stockholders under the Plan of Dissolution.

Reporting Requirements

Whether or not the Dissolution is approved, we will have an obligation to continue to comply with the applicable reporting requirements of the Exchange Act until we have exited from such reporting requirements. NYSE has filed a Form 25 with the SEC to terminate our registration under Section 12(b) of the Exchange Act. We have also filed a Form 15 with the SEC to terminate our registration under Section 12(g) of the Exchange Act and suspend our reporting obligations under Section 15(d) of the Exchange Act. While our periodic reporting obligations under Section 15(d) of the Exchange Act are suspended, we will still be required to comply with certain public company reporting requirements in connection with this proxy statement until our Form 15 becomes effective. Accordingly, unless and until our Form 15 becomes effective, we may continue to incur expenses that could reduce any amount available for distribution, including expenses of complying with public company reporting requirements and paying our service providers, among others.

Interests of Certain Persons in the Dissolution

After the Effective Time, we expect that Lawrence Knopf, Richard Capasso and David Nyero Nyeko will be retained as consultants for the purpose of winding up our business and affairs. We also expect to retain Michael Jacoby as the Chief Restructuring Officer and potentially other offices at the discretion of the Board. We expect to compensate these individuals for their service in these roles during the Dissolution.

See “Security Ownership of Certain Beneficial Owners and Management” for information regarding the number of shares of Common Stock owned by our directors and executive officers.

Our Restated Certificate of Incorporation, Amended and Restated Bylaws and the DGCL

During the Survival Period, we will continue to be governed by our Charter and Bylaws, insofar as their terms apply and insofar as necessary or appropriate to implement our Plan of Dissolution, as well as the DGCL. Our Board will continue to have the authority to amend Bylaws as it may deem necessary or advisable.

Authority of the Board

If the Plan of Dissolution is approved by our stockholders, our Board, without further action by our stockholders, will be authorized to take all actions as it deems necessary or advisable to implement our Plan of

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Dissolution. All determinations and decisions to be made by our Board will be at the absolute and sole discretion of our Board.

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CERTAIN MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE PROPOSED DISSOLUTION

The following discussion is a summary of the material U.S. federal income tax consequences of the proposed Dissolution to U.S. Holders and Non-U.S. Holders (each as defined below), but does not purport to be a complete analysis of all potential tax effects. The effects of other U.S. federal tax laws, such as estate and gift tax laws, and any applicable state, local, or non-U.S. tax laws are not discussed. This discussion is based on the Code, Treasury Regulations promulgated thereunder, judicial decisions, and published rulings and administrative pronouncements of the IRS, in each case in effect as of the date hereof. These authorities may change or be subject to differing interpretations. Any such change or differing interpretation may be applied retroactively in a manner that could adversely affect a stockholder of our Common Stock. We have not sought and will not seek an opinion of counsel or any rulings from the IRS regarding the matters discussed below. There can be no assurance the IRS or a court will not take a contrary position to that discussed below regarding the tax consequences of the Dissolution.

This discussion is limited to U.S. Holders and Non-U.S. Holders that hold our Common Stock as a “capital asset” within the meaning of Section 1221 of the Code (generally, property held for investment). This discussion does not address all of the U.S. federal income tax consequences that may be relevant to our stockholders in light of their individual circumstances, including the impact of the Medicare contribution tax on net investment income and the alternative minimum tax. In addition, it does not address any U.S. federal income tax consequences to our stockholders that are subject to special rules, such as:

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If a partnership (or other entity or arrangement treated as a partnership for U.S. federal tax purposes) holds our Common Stock, the tax treatment of a partner in that partnership will generally depend on the status of the partner, the activities of the partnership, and certain determinations made at the partner level. Accordingly, partnerships holding our Common Stock and partners in such partnerships should consult their tax advisors regarding the U.S. federal income tax consequences to them.

THIS DISCUSSION IS FOR INFORMATION PURPOSES ONLY AND IS NOT LEGAL OR TAX ADVICE. STOCKHOLDERS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE APPLICATION OF THE U.S. FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AS WELL AS ANY TAX CONSEQUENCES OF THE DISSOLUTION ARISING UNDER THE U.S. FEDERAL ESTATE OR GIFT TAX LAWS OR UNDER THE LAWS OF ANY STATE, LOCAL, OR NON-U.S. TAXING JURISDICTION OR UNDER ANY APPLICABLE INCOME TAX TREATY.

Definitions of U.S. Holder and Non-U.S. Holder

For purposes of this discussion, a “U.S. Holder” is a beneficial owner of shares of Common Stock that, for U.S. federal income tax purposes, is or is treated as:

For purposes of this discussion, a “Non-U.S. Holder” is any beneficial owner of our common stock that is neither a U.S. Holder nor an entity or arrangement treated as a partnership for U.S. federal income tax purposes.

U.S. Federal Income Tax Consequences of the Dissolution

We intend for distributions made pursuant to the Plan of Dissolution to be treated as a series of distributions in complete liquidation of the Company, and this discussion assumes this treatment will be respected. In accordance with such treatment, each of our stockholders will be treated as receiving its portion of such distributions in exchange for its shares of our Common Stock. If a stockholder holds different blocks of shares of our Common Stock (generally, shares of our Common Stock purchased or acquired on different dates or at different prices), the holder’s portion of such distributions must be allocated among the several blocks of shares in the proportion that the number of shares in a particular block bears to the total number of shares owned by the holder.

If we distribute any asset other than cash pursuant to the Plan of Dissolution, or if a stockholder assumes a liability in connection with the Dissolution, the treatment of such asset or liability may vary depending on the circumstances of the stockholder and the nature of the asset or liability. Stockholders should consult their tax advisors with respect to the tax consequences to them of the receipt of any such asset or assumption of any such liability.

Until all of our remaining assets have been distributed to our stockholders or a liquidating trust and the liquidation is complete, we will continue to be subject to U.S. federal income tax on our income, if any, such as interest income. We will recognize gain or loss, if any, upon the sale of any assets held directly by us in

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connection with our Dissolution in an amount equal to the difference between (1) the fair market value of the consideration received for each asset sold and (2) our adjusted tax basis in the asset sold. We may also recognize income from the liquidation and dissolution of our subsidiaries that will occur as part of the proposed Dissolution. We should not recognize any gain or loss upon the distribution of cash to our stockholders as part of the proposed Dissolution. If we do make a liquidating distribution to our stockholders of property other than cash, we generally will recognize gain or loss upon the distribution of the property as if the property were sold to our stockholders for its fair market value on the date of the distribution. Any tax liability resulting from the proposed Dissolution will reduce the cash available for distribution to our stockholders.

Notwithstanding our position that any distributions made pursuant to the Plan of Dissolution will be treated as a series of distributions in complete liquidation of the Company, it is possible that the IRS or a court could determine that any of these distributions is a current distribution. In addition, if the Dissolution is abandoned or revoked, these distributions would be treated as current distributions. A current distribution would be treated as a dividend for U.S. federal income tax purposes to the extent of our current and accumulated earnings and profits. Under this treatment, amounts not treated as dividends for U.S. federal income tax purposes would constitute a return of capital and first be applied against and reduce a holder’s adjusted tax basis in its shares of our Common Stock, but not below zero. Any excess would be treated as capital gain. Stockholders should consult their tax advisors with respect to the proper characterization of any distributions made pursuant to the Plan of Dissolution.

U.S. Federal Income Tax Consequences to U.S. Holders

U.S. Holders that receive any distributions made by us pursuant to the Plan of Dissolution will be treated as receiving those amounts as full payment in exchange for their shares of Common Stock. A U.S. Holder generally will recognize gain or loss on a share-by-share basis equal to the difference between (1) the sum of the amount of cash and the fair market value of property, if any, distributed to such holder with respect to each share (including distributions to any liquidating trust, as discussed below), less any known liabilities assumed by the U.S. Holder or to which the distributed property (if any) is subject, and (2) such U.S. Holder’s adjusted tax basis in each share of our Common Stock. Liquidating distributions are first applied against, and reduce, the U.S. Holder’s adjusted tax basis with respect to a share or a block of shares of Common Stock before recognizing any gain or loss. A stockholder will recognize gain to the extent the aggregate distributions allocated to the share of Common Stock or, if applicable, block of Common Stock exceeds the U.S. Holder’s adjusted tax basis with respect to such share or such block. A U.S. Holder will recognize loss only to the extent such holder has an adjusted tax basis with respect to a share or a block after taking into account all liquidating distributions allocated to the share or the block. Any loss can only be recognized in the tax year that a U.S. Holder receives our final liquidating distribution.

Generally, gain or loss recognized by a U.S. Holder in connection with the proposed Dissolution will be capital gain or loss, and will be long-term capital gain or loss if the holder has held a share or block for more than one year or short-term capital gain or loss if the holder has held the share or block for one year or less. Certain U.S. Holders, including individuals, may qualify for preferential tax rates on long-term capital gains. The deductibility of capital losses is subject to certain limitations. Amounts, if any, received by a U.S. Holder upon the resolution of a contingent claim that has been distributed could be considered ordinary income rather than capital gain. U.S. Holders should consult their tax advisors with respect to the tax consequences of receiving a contingent claim as part of the proposed Dissolution.

If a U.S. Holder is required to satisfy any liability not fully covered by our reserve (see the section of this proxy statement captioned “Contingent Liabilities; Reserves”), payments by such U.S. Holder in satisfaction of such liabilities would generally result in a capital loss in the year paid, which, in the hands of individual U.S. Holders, cannot be carried back to prior years to offset capital gains realized from a liquidating distribution in those years.

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U.S. Federal Income Tax Consequences to Non-U.S. Holders

Non-U.S. Holders that receive any distributions made by us pursuant to the Plan of Dissolution will be treated as receiving those amounts as full payment in exchange for their shares of Common Stock. The amount of any such distributions allocable to a block of shares of our common stock owned by the Non-U.S. Holder will reduce the Non-U.S. Holder’s tax basis in such shares, but not below zero. Any excess amount allocable to such shares will be treated as capital gain. A Non-U.S. Holder will not be subject to U.S. federal income tax on any such gain unless:

Gain described in the first bullet point above will generally be subject to U.S. federal income tax on a net income basis at the regular rates. A Non-U.S. Holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on such effectively connected gain, as adjusted for certain items.

A Non-U.S. Holder described in the second bullet point above will be subject to U.S. federal income tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on any gain realized, which may be offset by certain U.S. source capital losses of the Non-U.S. Holder (even though the individual is not considered a resident of the United States), provided the Non-U.S. Holder has timely filed U.S. federal income tax returns with respect to such losses.

With respect to the third bullet point above, we believe we are not currently and do not anticipate becoming a USRPHC. Because the determination of whether we are a USRPHC depends on the fair market value of our USRPIs relative to the fair market value of our other business assets and our non-U.S. real property interests, however, there can be no assurance we currently are not a USRPHC or will not become one in the future. Even if we are or were a USRPHC, gain recognized by a Non-U.S. Holder will not be subject to U.S. federal income tax if one or more exceptions from these rules under the Code apply.

Non-U.S. Holders should consult their tax advisors regarding potentially applicable income tax treaties that may provide for different rules.

Information Reporting and Backup Withholding

U.S. Holders

A U.S. Holder may be subject to information reporting and backup withholding when such holder receives a distribution made pursuant to the Plan of Dissolution. Certain U.S. Holders are exempt from backup withholding, including corporations and certain tax-exempt organizations. A U.S. Holder will be subject to backup withholding if such holder is not otherwise exempt and:

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Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a U.S. Holder’s U.S. federal income tax liability, provided the required information is timely furnished to the IRS. U.S. Holders should consult their tax advisors regarding their qualification for an exemption from backup withholding and the procedures for obtaining such an exemption.

Non-U.S. Holders

A distribution made pursuant to the Plan of Dissolution and received within the United States or through certain U.S.-related brokers generally will not be subject to backup withholding or information reporting, if the applicable withholding agent does not have actual knowledge or reason to know the holder is a United States person and the holder either certifies its non-U.S. status, such as by furnishing a valid IRS Form W-8BEN, W-8BEN-E or W-8ECI, or otherwise establishes an exemption. Proceeds from a distribution made pursuant to the Plan of Dissolution and received through a non-U.S. office of a non-U.S. broker generally will not be subject to backup withholding or information reporting.

Copies of information returns that are filed with the IRS may also be made available under the provisions of an applicable treaty or agreement to the tax authorities of the country in which the Non-U.S. Holder resides or is established.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a Non-U.S. Holder’s U.S. federal income tax liability, provided the required information is timely furnished to the IRS.

U.S. Federal Income Tax Consequences of a Liquidating Trust

We may transfer our remaining assets and obligations to a liquidating trust if our Board of Directors determines that such a transfer is advisable. Under applicable Treasury Regulations, a trust will be treated as a “liquidating trust” if it is organized for the primary purpose of liquidating and distributing the assets transferred to it, and if its activities are all reasonably necessary to and consistent with the accomplishment of that purpose. However, if the liquidation is unreasonably prolonged or if the liquidation purpose becomes so obscured by business activities that the declared purpose of the liquidation can be said to be lost or abandoned, the trust will no longer be considered a liquidating trust and adverse tax consequences may apply to the trust or to stockholders. Although neither the Code nor the Treasury Regulations thereunder provide any specific guidance as to the length of time a liquidating trust may last, the IRS’s guidelines for issuing rulings with respect to liquidating trust status call for a term not to exceed three years, which period may be extended to cover the collection of installment obligations.

If we transfer assets to a liquidating trust and distribute interests in the liquidating trust to stockholders, we intend that such transfer and distribution would be treated for U.S. federal income tax purposes as if we distributed an interest in each of the assets so transferred directly to such stockholders in a liquidating distribution. In that case, each stockholder would be treated generally as described above in respect of such liquidating distribution.

Assuming that the liquidating trust is treated as a “liquidating trust” for U.S. federal income tax purposes, we intend that the liquidating trust would be treated as a “grantor trust” for U.S. federal income tax purposes. In that case, each unit or interest in the liquidating trust would represent ownership of an undivided proportionate interest in all of the assets and liabilities of the liquidating trust and a stockholder would be treated for U.S. federal income tax purposes as receiving or paying, as applicable, directly a pro rata portion of all income, gain,

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loss, deduction, and credit of the liquidating trust. A stockholder would be taxed each year on its share of income from the liquidating trust, net of such stockholder’s share of any expenses or other amounts that are deductible by such holder for U.S. federal income tax purposes whether or not such stockholder receives a distribution of cash from the liquidating trust that year. When the liquidating trust makes distributions to stockholders, the stockholders generally would recognize no additional gain or loss. The long-term or short-term character of any capital gain or loss recognized in connection with the sale of the liquidating trust’s assets would be determined based upon a holding period commencing at the time of the acquisition by a stockholder of such stockholder’s beneficial interest in the liquidating trust.

The trustee or trustees of the liquidating trust would provide to each holder of units in the liquidating trust after each year end a detailed itemized statement that reports on a per unit basis the stockholder’s allocable share of all the various categories of income and expense of the liquidating trust for the year. Each stockholder must report such items on its U.S. federal income tax return regardless of whether the liquidating trust makes current cash distributions.

If the liquidating trust fails to qualify as a liquidating trust that is a grantor trust for U.S. federal income tax purposes, the consequences to stockholder would depend on the reason for the failure to qualify, and, under certain circumstances, the liquidating trust could be treated as an association taxable as a corporation for U.S. federal income tax purposes. If the liquidating trust is taxable as a corporation, the trust itself would be subject to U.S. federal income tax at the applicable corporate income tax rate. In that case, distributions made by the liquidating trust would be reduced by any such additional taxes imposed on the trust, and a stockholder would be subject to tax upon the receipt of distributions that constitute dividends and distributions in excess of such stockholder’s adjusted tax basis in its interests in the liquidating trust from the trust rather than taking into account its share of the trust’s taxable items on an annual basis. Stockholders should consult their tax advisors regarding the tax consequences that would apply to them if we were to transfer assets to a liquidating trust.

THE U.S. FEDERAL INCOME TAX CONSEQUENCES SUMMARIZED ABOVE ARE FOR GENERAL INFORMATION ONLY. STOCKHOLDERS SHOULD CONSULT THEIR TAX ADVISORS AS TO THE PARTICULAR CONSEQUENCES THAT MAY APPLY TO THEM.

Votes Required

The affirmative vote of the holders of at least two-thirds in voting power of the Company’s outstanding shares of capital stock entitled to vote on the Dissolution Proposal is required to approve the Dissolution Proposal. Abstentions and broker non-votes will have the same effect as a vote “AGAINST” the Dissolution Proposal.

Recommendation of the Board

The Board unanimously recommends that you vote “FOR” the Dissolution Proposal to approve the Dissolution in accordance with the terms and conditions of the Plan of Dissolution.

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PROPOSAL 3: APPROVAL OF ADJOURNMENT OF SPECIAL MEETING

TO SOLICIT ADDITIONAL PROXIES

General

If at the Special Meeting the number of shares voting in favor of the approval of the Sale Proposal and/or the Dissolution Proposal are insufficient to approve such proposal(s) under Delaware law, SQZ intends to move to adjourn the Special Meeting in order to enable the Board to solicit additional proxies in respect of the approval of the Sale Proposal and/or Dissolution Proposal. In that event, SQZ may ask SQZ’s stockholders to vote only upon the Adjournment Proposal during such portion of the Special Meeting.

SQZ is asking that you approve the Adjournment Proposal, which will authorize the adjournment of the Special Meeting, from time to time, to a later date or dates, for the purpose of soliciting additional proxies. If the stockholders approve the Adjournment Proposal, SQZ could adjourn the Special Meeting and use the additional time to solicit additional proxies in favor of the Sale Proposal and/or the Dissolution Proposal, including the solicitation of proxies from stockholders that have previously voted.

Votes Required

If a quorum is present at the Special Meeting, the affirmative vote of the holders of a majority in voting power of the votes cast affirmatively or negatively is required for the approval of the Adjournment Proposal. Broker non-votes (if any) and abstentions will not be counted as votes cast on the matter and will have no effect on the outcome of the Adjournment Proposal.

Recommendation of the Board

The Board believes that if the number of shares voting in favor of the Sale Proposal and/or the Dissolution Proposal are insufficient to approve such proposals, it is in the best interests of the stockholders to enable the Board to continue to seek to obtain a sufficient number of additional votes to approve the Sale Proposal and/or the Dissolution Proposal.

The Board unanimously recommends that you vote “FOR” the Adjournment Proposal.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information with respect to holdings of our common stock by (i) stockholders who beneficially owned more than 5% of the outstanding shares of our common stock, and (ii) each of our directors, each of our named executive officers and all directors and executive officers as a group as of December 31, 2023, unless otherwise indicated. The number of shares beneficially owned by each stockholder is determined under rules issued by the SEC. Under these rules, beneficial ownership includes any shares as to which a person has sole or shared voting power or investment power. Applicable percentage ownership is based on 29,491,125 shares of Common Stock outstanding as of December 31, 2023. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of Common Stock subject to options, or other rights held by such person that are currently exercisable or will become exercisable within 60 days of December 31, 2023 are considered outstanding, although these shares are not considered outstanding for purposes of computing the percentage ownership of any other person.

Unless otherwise indicated, the address of each beneficial owner listed below is PO Box 5515, Wayland, Massachusetts 01778. We believe, based on information provided to us, that each of the stockholders listed below has sole voting and investment power with respect to the shares beneficially owned by the stockholder unless noted otherwise, subject to community property laws where applicable.

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HOUSEHOLDING

SEC rules permit companies and intermediaries such as brokers to satisfy delivery requirements for proxy statements and notices with respect to two or more stockholders sharing the same address by delivering a single proxy statement or a single notice addressed to those stockholders. This process, which is commonly referred to as “householding”, provides cost savings for companies and helps the environment by conserving natural resources. Some brokers household proxy materials, delivering a single proxy statement or notice to multiple stockholders sharing an address unless contrary instructions have been received from the affected stockholders. Once you have received notice from your broker that they will be householding materials to your address, householding will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate proxy statement or notice, or if your household is receiving multiple copies of these documents and you wish to request that future deliveries be limited to a single copy, please notify your broker. You can also request prompt delivery of a copy of this proxy statement by contacting our Secretary at our offices at PO Box 5515, Wayland, Massachusetts 01778.

OTHER MATTERS

Our Bylaws provide that no business may be transacted at any special meeting of stockholders other than the business specified in the notice of such meeting. Accordingly, as of the date of this proxy statement no business other than the proposals set forth in this proxy statement shall be conducted at the Special Meeting.

INFORMATION ABOUT SQZ BIOTECHNOLOGIES COMPANY

Business

We are a clinical-stage biotechnology company founded on the therapeutic potential of Cell Squeeze^®, our proprietary technology which allows for rapid delivery of a variety of cargo into different cell types.

On November 30, 2022, the Board approved a restructuring plan and strategic prioritization (the “2022 Restructuring Plan”) of our clinical portfolio to concentrate on the development of our second-generation enhanced Antigen Presenting Cells (“eAPC”) cell therapy program, focused on Human papillomavirus (“HPV”) 16 positive recurrent, locally advanced, or metastatic solid tumors and reduce our workforce by approximately 60 percent. On November 30, 2022, the Board appointed Howard Bernstein, MD, PhD, our director and former Chief Scientific Officer, as Interim Chief Executive Officer. At the time of the November 2022 strategic realignment announcement, the SQZ-AAC-HPV trial had one patient in the lowest-dose cohort on study. On December 21, 2022, after two treatment cycles, the patient’s CT scan showed reduction of the target lesion, which was consistent with a partial response by RECIST 1.1 criteria. A subsequent scan on February 2, 2023, after four treatment cycles, showed further reduction of the target lesion, which was consistent with a confirmed partial response / unconfirmed complete response by RECIST 1.1 criteria. In March 2023, after seven cycles of SQZ-AAC-HPV, a CT scan confirmed the complete response by RECIST 1.1 criteria. In light of this response in the first patient dosed, we decided to continue to enroll patients in the SQZ-AAC-HPV clinical trial. We subsequently enrolled two additional patients in the low dose cohort of the SQZ-AAC-HPV trial. Both patients achieved a best overall response of stable disease.

On July 3, 2023, we received a written notice from the NYSE notifying us that the NYSE commenced proceedings to delist our Common Stock from the NYSE. The NYSE reached this determination pursuant to Section 802.01B of the NYSE’s Listed Company Manual because the Company had fallen below the NYSE’s continued listing standard requiring listed companies to maintain an average global market capitalization of at least $15 million over a consecutive 30-trading day period. The NYSE suspended trading in the Company’s Common Stock immediately after market close on July 3, 2023. Our Common Stock began trading in the over-the-counter markets, under the symbol SQZB, commencing on July 5, 2023. The over-the-counter markets

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are significantly more limited than the NYSE, and quotation on the over-the-counter markets may result in a less liquid market available for existing and potential securityholders to trade the Common Stock and could further depress the trading price of the Common Stock. We can provide no assurance that the Common Stock will continue to trade on the over-the-counter markets, whether broker-dealers will continue to provide public quotes of the Common Stock or whether the trading volume of the Common Stock will be sufficient to provide for an efficient trading market.

On July 25, 2023, we announced that F. Hoffmann-La Roche Ltd (“Roche Basel”) and Hoffmann-La Roche Inc. (“Roche US”, and together with Roche Basel, “Roche”) determined that Roche will not exercise its option under the License and Collaboration Agreement, dated October 5, 2018, by and between us and Roche, to obtain an exclusive license to develop and commercialize the Company’s candidate targeting HPV 16 positive solid tumors under our SQZ-APC-HPV program. On September 13, 2023, the 2018 Roche Agreement (as defined below) was terminated. No early termination penalty was incurred by either party. As of September 13, 2023, we regained full clinical development and future commercialization rights for our programs targeting HPV 16 positive tumors. We also announced that we intend to explore potential strategic alternatives to support the advancement of our oncology programs including HPV 16 positive tumors, in an effort to allow us to partner all our clinical and preclinical assets across all disease areas and indications.

On September 29, 2023, the Board approved an additional workforce reduction of approximately 80% of the remaining employees (the “2023 Restructuring Plan”) and ceased substantially all research and development activities to reduce our ongoing operating expenses while we pursued strategic alternatives. Should a strategic alternative be implemented, we anticipate using available net proceeds to discharge our liabilities and outstanding obligations, distribute the remainder, if any, to stockholders and wind down our operations. Should we be unable to identify and implement a meaningful strategic alternative in a timely manner, the Board is likely to consider bankruptcy or other dissolution proceedings. In connection with the 2023 Restructuring Plan, we determined to continue to dose existing patients in our clinical programs through November 2023 and to discontinue enrollment of new patients in our clinical trials.

Company History

Our company is founded on the novel discovery of Cell Squeeze^® technology. This foundational technology is based on the work of former Chief Executive Officer, Dr. Armon Sharei, in the laboratories of Dr. Klavs Jensen and Dr. Robert Langer at the Massachusetts Institute of Technology. In a series of experiments with a complex, high-pressure, fluid-jet delivery system, the team discovered that rapid mechanical deformation of cells enables intracellular delivery of biomaterials, resulting in the first prototype of the SQZ^® microfluidic chip. Through collaboration with leading scientists in the immunology and regenerative medicine fields, the team discovered the process’ novel capabilities and potential for significant impact through engineering of cell biology and function. SQZ Biotechnologies was founded with the goal of realizing the broad potential of this technology and developing cellular medicines that are effective and well-tolerated, with improved therapeutic accessibility, for patients around the world.

SQZ Technology

We have developed the Cell Squeeze^® technology to be a rapid and versatile method of biomolecule delivery to cells and have demonstrated application of our clinical-scale Cell Squeeze^® system to reliably yield patient dose production timelines of under 24 hours for our investigational SQZ-PBMC-HPV, SQZ-eAPC-HPV and SQZ-AAC-HPV therapeutic candidates. As illustrated below, the Cell Squeeze^® approach utilizes microfluidic mechanical deformation which facilitates squeezing cells at high speeds through constriction(s) to temporarily disrupt the cell membrane and allow the target cargo to enter directly into the cytosol. At the current clinical scale, our proprietary system processes over 10 billion patient cells per minute.

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Our Manufacturing

Since our founding, we have invested in and advanced our Cell Squeeze^® platform, which includes our proprietary Cell Squeeze^® technology, methods, and systems, with the aim to enable a variety of cell engineering applications for the development of cell therapy product candidates. We believe that the ability to manufacture cell therapies rapidly and reliably is an important competitive advantage in the cell therapy field.

With our current clinical-scale Cell Squeeze^® system and associated manufacturing processes, we have demonstrated patient dose production times of under 24 hours and product release times of approximately one week for our therapeutic candidates. Our current manufacturing and release testing workflow is represented in the figure below.

We have developed a prototype automated, point-of-care manufacturing system that could potentially streamline manufacturing and future product candidate development timelines, furthering our broader vision to improve the accessibility and patient impact potential of cell therapies. In May 2022, we provided preclinical data showcasing the SQZ^® point-of-care manufacturing system substantially reduced manufacturing times and operator hours, while preserving or improving on key product viability metrics when compared to our standard manufacturing practices. During 2023, we continued to develop, enhance and test the point-of-care manufacturing system. We believe there is potential to operate the point-of-care manufacturing system outside of a clean room which could further reduce manufacturing costs for our therapeutic product candidates.

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Product Candidate Pipeline

SQZ^® Enhanced Antigen Presenting Cell (eAPC) Platform

eAPC Platform Overview. The SQZ^® eAPC platform is the second-generation product candidate designed to generate tumor-specific CD8+ T cell activation to drive the antitumor immune response. eAPCs utilize direct antigen presentation to engineer the three canonical T cell activation signals of peptide-MHC (Signal 1), costimulatory proteins (Signal 2) and cytokines (Signal 3), into the antigen presenting cells in an effort to create novel, multi-functional cell therapy product candidates for driving antitumor immunity. CD8+ T cells are known to be important effectors of the adaptive immune system, and are foundational to the recent clinical success of immunotherapy in oncologic indications.

SQZ^® eAPCs are engineered from peripheral blood mononuclear cells (PBMCs) by using the Cell Squeeze^® system to simultaneously deliver 5 mRNAs encoding for full length HPV16 E6 and E7 proteins, CD86, and membrane-bound (mb) IL-2 and mbIL-12 cytokines.

While there has been significant interest in therapeutic immunization approaches to prime CD8+ T cell responses in an antigen-specific manner, it has remained challenging to effectuate adequate responses for antitumor applications. We believe that our approach, utilizing Cell Squeeze^® delivery, enables us to engineer antigen presentation in multiple peripheral blood cell types to create a cellular vaccine that has the potential to direct antigen-specific immunity.

To mount an immune response, CD8+ T cells require antigen presentation on major histocompatibility complex class I (“MHC-I”), molecules by APCs. Antigenic peptides displayed on MHC-I are primarily sourced from the cytosol. Traditionally, antigen-targeted cell therapies and vaccine systems, which introduce antigens in the extracellular vicinity, have relied on a process called cross-presentation to route to the MHC-I pathway. Cross-presentation can generally be considered an ineffective mechanism of MHC-I presentation to CD8+ T cells, as typically only a fraction of introduced antigen material is present in the cytosol for MHC-I loading.

In contrast, in preclinical studies, our microfluidic Cell Squeeze^® technology demonstrated abilities to deliver a variety of antigens directly into the cytosol, enabling potent antigen presentation for CD8+ T cell priming. In January 2022, we published peer-reviewed in vitro potency data for our first-generation SQZ^® APCs

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(the predecessor to our eAPC platform) in the Journal of Immunology, where we demonstrated Cell Squeeze^®-mediated cytosolic delivery yielded 1000-fold more efficient CD8+ activation relative to cross-presentation in dendritic cells.

Through accessing the MHC-I antigen presentation pathway in a physiological manner, we believe we can activate CD8-driven adaptive immunity against targeted diseases. Based on our preclinical research, we believe the SQZ^® eAPC platform demonstrated the potential to achieve several coordinates of a T cell response.

SQZ^® eAPCs is an autologous product candidate and is generated through the engineering of patient B cells, T cells, Natural killer cells, and monocytes with 5 mRNAs encoding antigen-specific and immunological functions in a single Cell Squeeze^® step. We believe that our eAPC platform has the potential to provide several therapeutic benefits, including:

We believe that our approach to engineering PBMCs as eAPCs has the potential to represent an advancement over previous antigen-specific methods by augmenting the quantity, quality, and breadth of targeted T cell responses, and by integrating multiple immunological functions into a single therapeutic. We believe that eAPCs can have broad therapeutic potential across a range of solid cancers, and that we can utilize current and future generations of our cell therapy platform to target a variety of tumor antigens with the aim to drive antitumor immunity. In preclinical studies, we have demonstrated the potential of eAPCs to generate functional T cell responses across multiple antigen target categories, including virally derived antigens, such as HPV, that are known to be highly immunogenic and point mutants, such as KRAS G12D and G12V, that are considered less immunogenic.

SQZ^® eAPC Product Candidate: SQZ-eAPC-HPV

HPV+ Cancers Incidence and Unmet Need. HPV infection causes some of the most common types of cancer, such as cervical and head and neck cancer, and there is significant need for new treatment options to address HPV+ tumors. According to the Centers for Disease Control (“CDC”) in the United States, HPV+ tumors represent 3% of all cancers in women and 2% of all cancers in men, resulting in over 36,000 new cases of HPV+ tumors every year. HPV+ tumors represent 4.5% of all cancers worldwide, according to the International Journal of Cancer, resulting in 570,000 new cases for women and 60,000 new cases for men globally every year. According to the CDC, HPV infection plays a significant role in the formation of more than 90% of anal and cervical cancers, and most cases of vaginal (75%), oropharyngeal (70%), vulval (70%) and penile (60%) cancers. In addition, an increasing percentage of head and neck cancer is being attributed to HPV infection, particularly those arising from the oropharynx.

The standard first-line treatment for HPV+ cancers differs by tumor type but typically involves a combination of chemotherapy, radiation, surgery, and more recently, in certain HPV-associated tumor types, specific checkpoint inhibitors and molecular targeted therapies. However, in patients with recurrent, metastatic, or persistent disease, second-line treatment options are limited with deterioration in response rates and prognosis. For example, in recurrent or metastatic head and neck squamous cell carcinoma patients who have progressed during or after platinum-containing chemotherapy, the median overall survival is under 9 months.

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Preclinical Development of SQZ-eAPC-HPV in Solid Tumors. Our lead eAPC product candidate, SQZ-eAPC-HPV, is engineered with mRNA cargo encoding the full-length HPV16+ E6 and E7 antigenic proteins and is in development for the treatment of HPV16+ tumors. Additionally, SQZ-eAPC-HPV is designed to express CD86 as a costimulatory molecule for T cell activation, as well as proprietary, membrane-bound versions of IL-2 and IL-12 (mbIL-2 and mb-IL-12) in an effort to further potentiate T cell activation and expansion. Our IND (as defined below) for a Phase 1/2 clinical trial to study SQZ-eAPC-HPV was allowed to proceed by the U.S. Food and Drug Administration (“FDA”) in January 2022.

In November 2021, we presented preclinical data for SQZ-eAPC-HPV at the SITC Annual Meeting, where we demonstrated the following:

HPV16 E6 and E7 TCR-transduced CD8+ T cells were cultured for 6 days with autologous PBMCs that were squeezed in the presence of E6 and E7 mRNA and/or CD86, mbIL-2 and mbIL-12 mRNA. CD8+ T cells were restimulated with the E6 or E7 minimal epitopes, and intracellular cytokine staining for IFNg was conducted to measure the expansion of HPV16-specific T cells.

Clinical Development of SQZ-eAPC-HPV in Solid Tumors. We evaluated SQZ-eAPC-HPV in the Phase 1/2 COMMANDER-001 trial for recurrent, locally advanced, or metastatic HPV16+ solid tumors. The trial was an open-label, multicenter, dose escalation and expansion study to evaluate the safety and tolerability, immunogenic effects, antitumor activity, and pharmacodynamics of SQZ-eAPC-HPV as monotherapy and in combination with immune checkpoint inhibitors, including pembrolizumab.

The primary objectives of the trial were to evaluate safety and tolerability, as assessed by the number of participants with treatment-related adverse events and identify the RP2, of SQZ-eAPC-HPV monotherapy, which

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will be the dose utilized in combination with checkpoint inhibitors. The secondary objectives of the trial were evaluating antitumor activity in patients with recurrent, locally advanced, or metastatic solid tumors, based on tumor assessments using RECIST 1.1, and manufacturing feasibility, as assessed by individual patient batch yields. Initial safety data from the dose escalation / expansion trial were presented at the ESMO-IO annual congress in December 2022.

Study Design:

In December 2022, we presented initial interim results from the monotherapy dose escalation portion of the SQZ-eAPC-HPV trial in HPV16+ solid tumors at the ESMO-IO congress. Interim data were reported for four evaluable monotherapy patients in the lowest dose cohort—there was one patient in the second cohort that was not evaluable for the DLT. In an advanced population with a median of 3 prior lines of therapy. The interim results demonstrated that SQZ-eAPC-HPV was well-tolerated with stable disease as the best response. Key observations as of a cutoff date of November 25, 2022, include:

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Safety Data & Tolerability Assessment Summary

In November 2023, we presented interim results from the monotherapy dose escalation portion of the SQZ-eAPC-HPV trial in HPV16+ solid tumors at SITC (Poster 692), including:

SQZ^® Activating Antigen Carrier (AAC) Platform

AAC Platform Overview. The SQZ^® AAC platform was designed to induce antigen presentation in vivo by deriving antigen carriers from engineering RBCs with tumor-specific antigens and adjuvant. We generated AACs

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by engineering red blood cells (“RBCs”) to encapsulate relevant tumor antigens and the adjuvant polyinosinic-polycytidylic acid (poly I:C) for use as a tumor-specific cancer vaccine. The processing method and conditions used to create the AACs are designed to promote phosphatidylserine exposure on RBCs and thus harness the natural process of aged RBC clearance to enable targeting of the AACs to endogenous professional antigen presenting cells (“APCs”).

Preclinical Development of SQZ-AAC-HPV in Solid Tumors. To stimulate the adaptive immune system against specific antigens to yield CD8+ T cells with antitumor activity, we believe sufficient delivery of target antigens to APCs in an activating context is needed to enable MHC loading and T cell priming in lymphoid organs. While one arm of our directed immunity approach is based on ex vivo generation of APCs, the AAC arm focused on leveraging the natural process of aged RBC clearance to target resident, professional APC populations in vivo to drive antigen-specific activation. In preclinical studies, we have shown that AACs were rapidly taken up by professional APCs, such as macrophages and dendritic cells in the spleen and liver, and that AACs loaded with target antigens and adjuvant subsequently drove antigen-specific CD8+ T cell responses. At the 2020 SITC Annual Meeting, we presented murine data on the in vivo pharmacokinetics and functional activity of SQZ^® AAC therapeutic immunization, which we believe support the potential of AACs as a differentiated, directed immunity platform. In October 2022, we published our preclinical work in a peer-reviewed journal, Frontiers in Immunology, which showcases how AACs drove potent T Cell Responses and tumor regression in mice.

We believe that AAC product candidates could confer favorable attributes for a cellular therapy, including the potential for improved tolerability due to the physiological and targeted nature of immune activation, a more streamlined patient experience with whole blood collection without the need for leukapheresis and with administration via syringe push, and the potential for synergistic benefit with other immune-oncology and chemotherapeutic agents.

Clinical Development of SQZ-AAC-HPV in Solid Tumors. The ENVOY-001 trial was a Phase 1 open-label trial of our AAC HPV therapy candidate, or SQZ-AAC-HPV, as a monotherapy and in combination with immune checkpoint inhibitors in HLA-A*02+ patients with HPV16+ recurrent, locally advanced or metastatic solid tumors.

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The first patient (Patient 1) in the lowest-dose cohort of the SQZ-AAC-HPV-101 trial was a 61-year-old male with a history of HPV16+ metastatic rectal squamous cell carcinoma. He had two prior lines of treatment but has not been treated with immune checkpoint inhibitors (ICI).

On December 21, 2022, after two treatment cycles, Patient 1’s CT scan showed reduction of the target lesion—a right hilar lymph node—from 16 millimeters (mm) at baseline to 10mm, or approximately 38% from baseline, which was consistent with a partial response by RECIST 1.1 criteria. A subsequent scan on February 2, 2023, after four treatment cycles, showed further reduction of the target lesion to 8mm, or 50% from baseline, which was consistent with a confirmed partial response by RECIST 1.1 criteria, as well as an unconfirmed complete response. In March 2023, after seven cycles of SQZ-AAC-HPV, a CT scan confirmed the complete response by RECIST 1.1 criteria. Biomarker analysis on this patient identified an inflamed tumor microenvironment that highly expressed MHC1 cells and an increase in CD8+ cell density was observed. In light of this response in the first patient dosed, we decided to continue to enroll patients in the SQZ-AAC-HPV clinical trial. The Company completed the dose-limiting toxicity period for the lowest-dose cohort.

In November 2023, we presented initial data from a phase I dose escalation/expansion study of SQZ-AAC-HPV, a red blood cell-based therapeutic cancer vaccine for HPV16+ solid tumors at SITC (Poster 693), including:

MIT License Agreement

We exclusively license certain foundational technology from the Massachusetts Institute of Technology (“MIT”), pursuant to an Amended and Restated Exclusive Patent License Agreement dated as of December 2, 2015, as amended by that certain Amendment, dated as of May 17, 2022 and that certain Second Amendment, dated as of December 21, 2023 (the “MIT License Agreement”). The MIT License Agreement replaced an earlier Exclusive Patent License Agreement dated as of May 10, 2013, which was entered into in connection with the organization of the company. Under the MIT License Agreement, MIT granted us a worldwide, royalty bearing license to develop, make, have made, use, sell, offer to sell, lease, and import products incorporating the patent rights and to develop use, sell, offer to sell and perform processes incorporating the patent rights for all research and therapeutic applications for the term of the MIT License Agreement. Our rights under the license are exclusive in our fields of use, except with respect to (a) MIT and Harvard University (which owns the patent rights jointly with MIT), each of which retain rights for research, teaching and educational purposes on their own behalf and on behalf of all other non-profit research institutions, (b) Howard Hughes Medical Institution, which has an irrevocable, non-exclusive, non-assignable, non-sublicensable, license to use the patent rights for its own research purposes and (c) the federal government, which retains a non-exclusive and non-transferable license to practice any government-funded invention claimed in the patent rights, as provided by law. We also have the right to grant sublicenses to third parties, subject to written agreements containing similar protections of MIT and certain third-party beneficiaries as contained in the agreement.

We are required to use diligent efforts, or cause our affiliates or sublicensees to use diligent efforts, to develop licensed products, to introduce licensed products and processes into the commercial market and, thereafter, to make licensed products and processes reasonably available to the public. In addition, we are obligated to satisfy certain development and commercialization metrics and provide MIT with periodic progress reports. To date, we have met our diligence obligations under the agreement. For example, our collaboration with Roche and the commencement of our SQZ-PBMC-HPV trial meet clinical milestones under the agreement. After the fifth anniversary, and before the sixth anniversary, of the MIT License Agreement, the parties are obligated to discuss additional diligence obligations to continue the development and commercialization of licensed products and processes.

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We are obligated to make certain payments to MIT including an up-front license issue fee, annual maintenance fees, clinical milestone payments, running royalties based on net sales (at a rate in the low single digits), reimbursement of patent costs, and sharing of sublicense income. In June of 2019, we agreed with MIT on a payment schedule for the sharing of certain amounts received by us from Roche. MIT prosecutes and maintains the patent rights in close consultation with us and our intellectual property counsel. We also provide certain indemnifications for liabilities arising from claims related to the exercise of our rights under the agreement.

Upon entering into the MIT License Agreement, we paid a nominal license issue fee. We agreed to pay MIT a nominal annual license maintenance fee for each calendar year. Each year’s annual license maintenance fee may be credited to running royalties due in the same calendar year. We also agreed to pay MIT milestone payments in an aggregate amount of up to $1.8 million per licensed product or process that achieves certain clinical and regulatory milestones. Additionally, we agreed to pay royalties based on net sales of the licensed products or processes, at low single-digit rates that vary depending on whether sales are made in the therapeutic or research field. With respect to each sublicensee, we are obligated to pay MIT royalties equal to a low single-digit percentage of the sublicensee’s net sales (with such percentage varying slightly based on the nature of such sales). We also agreed to pay MIT a percentage in the mid-teens of our annual sublicense income (which does not include income from royalties).

The Second Amendment, entered into in anticipation of the assignment of the MIT License Agreement in connection with the Sale, will be effective upon the closing of the Asset Purchase Agreement, subject to the execution by the Purchaser of an assignment and assumption agreement in substantially the form attached to the Second Amendment. If these conditions are not met by April 30, 2024, then the Second Amendment shall terminate and will be considered null and void.

The Second Amendment, among other things, (i) modifies certain definitions and terms related to payment, indemnification, and running royalties (ii) requires the Company to develop and bring to market certain Licensed Products or Licensed Processes (each as defined in the MIT License Agreement), (iii) removes certain clinical milestones, and (iv) requires that the Company engage in certain development and commercialization activities using a Licensed Product or Licensed Process and manufactured under cGMP (as defined in the MIT License Agreement). In addition, under the Second Amendment, MIT waives and releases the Purchaser from any and all (i) financial obligations owed by the Company to MIT under the MIT License Agreement, and (ii) certain additional obligations owed by the Company to MIT under the MIT License Agreement, in each case, that arise on or before the closing of the transactions contemplated by the Asset Purchase Agreement.

The license will remain in effect until the expiration or abandonment of all issued patents and filed patent applications within the licensed patent rights. The agreement is terminable by us upon six months written notice, provided that we have paid all amounts due to MIT through such termination date, and by MIT for nonpayment of amounts due, our cessation of the business related to the agreement, our uncured material breach of the agreement or a challenge initiated by us of the validity, enforceability or non-infringement of the patents licensed to us under the agreement. In the event of any dispute relating to the agreement, either party may initiate mediation to facilitate a negotiated settlement prior to seeking other legal remedies.

Intellectual Property

We strive to protect and enhance the proprietary technology, inventions and improvements that we believe are commercially important to the development of our business, including by seeking, maintaining and defending patent rights, whether developed internally or licensed from third parties. We also rely on trade secrets, know-how, continuing technological innovation and in-licensing opportunities to develop, strengthen and maintain our proprietary position in our field.

Our future commercial success depends, in part, on our ability to: (i) obtain and maintain patent and other proprietary protection for commercially important technology, inventions and know-how related to our business;

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(ii) defend and enforce our intellectual property rights, in particular our patents rights; (iii) preserve the confidentiality of our trade secrets; and (iv) operate without infringing, misappropriating or violating the valid and enforceable patents and proprietary rights of third parties. Our ability to stop third parties from making, using, selling, offering to sell or importing our product candidates or any future products may depend on the extent to which we have rights under valid and enforceable patents or trade secrets that cover these activities.

Patents

The patent positions of biotechnology and pharmaceutical companies like ours are generally uncertain and can involve complex legal, scientific and factual issues. We cannot predict whether the patent applications we are currently pursuing will issue as patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient proprietary protection from competitors. We also cannot ensure that patents will issue with respect to any patent applications that we or our licensors may file in the future, nor can we ensure that any of our owned or licensed patents or future patents will be commercially useful in protecting our product candidates. In addition, the coverage claimed in a patent application may be significantly reduced before a patent is issued, and its scope can be reinterpreted and even challenged after issuance. As a result, we cannot guarantee that any of our products will be protected or remain protectable by enforceable patents. Moreover, any patents that we hold may be challenged, circumvented or invalidated by third parties.

In the United States, the term of a patent covering an FDA-approved drug may, in certain cases, be eligible for a patent term extension under the Hatch-Waxman Act as compensation for the loss of patent term during the FDA regulatory review process. The period of extension may be up to 5 years but cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval. Only 1 patent among those eligible for an extension and only those claims covering the approved drug, a method for using it, or a method for manufacturing it may be extended. Similar provisions are available in Europe and in certain other jurisdictions to extend the term of a patent that covers an approved drug. It is possible that issued U.S. patents covering the use of products from our intellectual property may be entitled to patent term extensions. If our use of product candidates or the product candidate itself receives FDA approval, we intend to apply for patent term extensions, if available, to extend the term of patents that cover the approved use or product candidate. We also intend to seek patent term extensions in any jurisdictions where available, however, there is no guarantee that the applicable authorities, including the FDA, will agree with our assessment of whether such extensions should be granted, and even if granted, the length of such extensions. The duration of patents outside of the United States varies in accordance with provisions of applicable local law, but typically is also 20 years from the earliest effective filing date. However, the actual protection afforded by a patent varies on a product-by-product basis, from country-to-country, and depends upon many factors, including the type of patent, the scope of its coverage, the availability of regulatory-related extensions, the availability of legal remedies in a particular country and the validity and enforceability of the patent.

Our patent portfolio includes more than 40 patent families that we own or have licensed, that have been prosecuted and maintained to potentially secure exclusivity for various SQZ^® candidates and platforms through to 2028-2043, without taking into account any patent term adjustments or extensions we may obtain. As of January 1, 2024, our portfolio is comprised of over 160 U.S. and foreign patents (including over 85 patents in various European countries) and over 250 U.S., Patent Cooperation Treaty (international), and foreign patent applications. These applications are designed to provide protection for various SQZ^® product candidates and platforms including the Cell Squeeze^® technology and current clinical candidates. In addition, these patents and applications contain a suite of claims directed to the SQZ^® systems, devices, composition of matter and methods of use, including methods of inducing an immune response, tolerance, treating cancer, treating various autoimmune diseases, and various other diseases.

The Cell Squeeze^® Platform. As of January 1, 2024, our Cell Squeeze^® platform, which includes the Cell Squeeze^® technology, methods and use, apparatus and components, and system, is comprised of 67 U.S. and foreign patents and 59 U.S., Patent Cooperation Treaty (international), and foreign patent applications. The

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patents and applications in this category are relevant or may be relevant to a variety of SQZ^® technologies, platforms, and product candidates.

The Immune Activation Platform. As of January 1, 2024, our immune cell platform, which includes the current SQZ-PBMC-HPV and SQZ-eAPC-HPV clinical candidates as well as confidential candidates and technology, specialized Cell Squeeze^® methods and use, as well as clinical formulations and protocols, is comprised of 6 US and foreign patents and 124 U.S., Patent Cooperation Treaty (international), and foreign patent applications.

As of January 1, 2024, our anucleate cell platform, which includes the current SQZ-AAC-HPV clinical candidate as well as confidential candidates and technology, specialized Cell Squeeze^® methods and use, as well as clinical formulations and protocols, is comprised of 37 U.S. and foreign patents and 32 U.S., Patent Cooperation Treaty (international), and foreign patent applications.

The Immune Tolerance Platform. As of January 1, 2024, our autoimmune platform, which includes the current TAC technology as well as confidential candidates and technology, specialized Cell Squeeze^® methods and use, is comprised of 31 U.S. and foreign patents and 17 U.S., Patent Cooperation Treaty (international), and foreign patent applications.

Exploratory Work. As of January 1, 2024, our earlier research and exploratory work, which includes confidential early-stage project candidates and specialized Cell Squeeze^® methods and use, is comprised of 12 U.S. and foreign patents and 21 U.S., Patent Cooperation Treaty (international), and foreign patent applications.

Trademarks

We currently own 32 allowed or registered trademarks in various jurisdictions worldwide, including five registered trademarks in the United States. We have one pending trademark application worldwide. Our trademark portfolio includes the following pending, allowed, or registered marks registered in the United States and certain other countries: Cell Squeeze, SQZ, SQZBiotech, Empower Cells to Change Lives, SQZ Therapeutics, SQZ Activating Antigen Carriers, SQZ Tolerizing Antigen Carriers, SQZ-AAC, and SQZ-TAC.

Trade Secrets and Proprietary Information

We rely upon unpatented trade secrets, confidential know-how and continuing technological innovation to develop and maintain our competitive position. However, trade secrets and confidential know-how are difficult to protect. We seek to protect our proprietary information, in part, using confidentiality agreements with applicable collaborators, scientific advisors, employees and consultants. We also have agreements requiring assignment of inventions with our employees and selected consultants, scientific advisors and collaborators. These agreements may not provide meaningful protection. These agreements may also be breached, and we may not have an adequate remedy for any such breach. In addition, our trade secrets and/or confidential know-how may become known or be independently developed by a third party, or misused by any collaborator to whom we disclose such information. Despite any measures taken to protect our intellectual property, unauthorized parties may attempt to copy aspects of our products or obtain or use information that we regard as proprietary. Although we take steps to protect our proprietary information, third parties may independently develop the same or similar proprietary information or may otherwise gain access to our proprietary information. As a result, we may be unable to meaningfully protect our trade secrets and proprietary information.

Competition

As a clinical-stage biotechnology company, we face competition from a wide array of companies in the pharmaceutical and biotechnology industries. This competition includes both small companies and large companies with greater financial and technical resources and longer operating histories than our own. We also compete with the intellectual property, technology and product development efforts of academic, governmental and private research institutions.

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Our competitors may have significantly greater financial resources, established presence in the market, expertise in research and development, manufacturing, preclinical and clinical testing, obtaining regulatory approvals and reimbursement and marketing approved products than we do. These competitors also compete with us in recruiting and retaining qualified scientific, sales, marketing and management personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs. Smaller or early-stage companies may also prove to be significant competitors, particularly if they establish collaborative arrangements with large companies.

The key competitive factors affecting the success of any products that we develop, if approved, are likely to be their efficacy, safety, convenience, price and the availability of reimbursement from government and other third-party payors. Our commercial opportunity for any of our product candidates could be reduced or eliminated if our competitors develop and commercialize products that are more effective, have fewer or less severe side effects, are more convenient, or are less expensive than any products that we may develop. Our competitors may also obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours and may commercialize products more quickly than we do.

We compete with companies using other cell engineering approaches, such as electroporation and viral vectors. Companies that are engineering cells with some of these methods include Fate Therapeutics, which is programming hematopoietic cells and other biotechnology companies working on single cell types. We also compete with companies who engineer cells using microfluidic mechanoporation or similar non-viral cell delivery technology, including Basilard BioTech, CellFE, Indee Labs, Kytopen, MxT Biotech, Portal Therapeutics and Navan Technologies.

While there are currently no FDA-approved therapies that target HPV for HPV+ cancers, there are multiple competing clinical-stage product candidates in development targeting HPV+ cancers. These product candidates include genetically modified T cell therapies in clinical development by Kite, peptide vaccines in clinical development by ISA Pharma, biologics being developed by Cue Biopharma, and nucleic acid vaccines in clinical development by BioNTech and clinical development by Inovio. Therapies that are not specific to HPV are also being explored and applied to HPV+ tumors, including tumor infiltrating lymphocytes developed by Iovance Biotherapeutics and immune checkpoint inhibitors that are approved for treatment in multiple solid tumors.

Government Regulation

The FDA and other regulatory authorities at federal, state, and local levels, as well as in foreign countries, extensively regulate, among other things, the research, development, testing, manufacture, quality control, import, export, safety, effectiveness, labeling, packaging, storage, distribution, record keeping, approval, advertising, promotion, marketing, post-approval monitoring, and post-approval reporting of biological product candidates such as those we are developing. We, along with third-party contractors, are required to navigate the various preclinical, clinical and commercial approval requirements of the governing regulatory agencies of the countries in which we wish to conduct studies or seek approval or licensure of our product candidates. The process of obtaining regulatory approvals and the subsequent compliance with applicable federal, state, local and foreign statutes and regulations require the expenditure of substantial time and financial resources.

U.S. Biologics Regulation

Biological products, including our product candidates, are subject to extensive regulation by the FDA under the Federal Food, Drug, and Cosmetic Act (“FDCA”), and the Public Health Service Act. The process required by the FDA before biologic product candidates may be marketed in the United States generally involves the following:

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Prior to beginning the first clinical trial with a product candidate in the United States, we must submit an IND to the FDA. An Investigational New Drug (“IND”) is a request for authorization from the FDA to administer an investigational new drug product to humans. The central focus of an IND submission is on the general investigational plan and the protocol(s) for clinical studies. The IND also includes results of animal and in vitro studies assessing the toxicology, pharmacokinetics, pharmacology, and pharmacodynamic characteristics of the product; chemistry, manufacturing, and controls information; and any available human data or literature to support the use of the investigational product. An IND must become effective before human clinical trials may begin. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within the 30-day time period, raises safety concerns or questions about the proposed clinical trial. In such a case, the IND may be placed on clinical hold and the IND sponsor and the FDA must resolve any outstanding concerns or questions before the clinical trial can begin. Submission of an IND therefore may or may not result in FDA authorization to begin a clinical trial.

In addition to the submission of an IND to the FDA, supervision of certain human gene transfer trials may also require evaluation and assessment by an institutional biosafety committee (“IBC”), a local institutional committee that reviews and oversees research utilizing recombinant or synthetic nucleic acid molecules at that institution. The IBC assesses the safety of the research and identifies any potential risk to the public health or the environment, and such assessment may result in some delay before initiation of a clinical trial.

Clinical trials involve the administration of the investigational product to human subjects under the supervision of qualified investigators in accordance with GCPs, which include the requirement that all research subjects provide their informed consent for their participation in any clinical study. Clinical trials are conducted under protocols detailing, among other things, the objectives of the study, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated. A separate submission to the existing IND must be made for each successive clinical trial conducted during product development and for any subsequent protocol amendments. While the IND is active, progress reports summarizing the results of the clinical trials and nonclinical studies performed since the last progress report, among other information, must be submitted at least annually to the FDA, and written IND safety reports must be submitted to the FDA and investigators for serious and unexpected suspected adverse events, findings from other studies suggesting a significant risk to humans exposed to the same or similar drugs, findings from animal or in vitro testing suggesting a significant risk to humans, and any clinically important increased incidence of a serious suspected adverse reaction compared to that listed in the protocol or investigator brochure.

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Furthermore, an independent IRB for each site proposing to conduct the clinical trial must review and approve the plan for any clinical trial and its informed consent form before the clinical trial begins at that site and must monitor the study until completed. Regulatory authorities, the IRB or the sponsor may suspend a clinical trial at any time on various grounds, including a finding that the subjects are being exposed to an unacceptable health risk or that the trial is unlikely to meet its stated objectives. Some studies also include oversight by an independent group of qualified experts organized by the clinical study sponsor, known as a data safety monitoring board, which provides authorization for whether or not a study may move forward at designated check points based on access to certain data from the study and may halt the clinical trial if it determines that there is an unacceptable safety risk for subjects or other grounds, such as no demonstration of efficacy. There are also requirements governing the reporting of ongoing clinical studies and clinical study results to public registries.

For purposes of BLA approval, human clinical trials are typically conducted in three sequential phases that may overlap or be combined:

In some cases, the FDA may require, or companies may voluntarily pursue, additional clinical trials after a product is approved to gain more information about the product. These so-called Phase 4 studies may also be made a condition to approval of the BLA. Concurrent with clinical trials, companies may complete additional animal studies and develop additional information about the biological characteristics of the product candidate and must finalize a process for manufacturing the product in commercial quantities in accordance with cGMP. The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things, must develop methods for testing the identity, strength, quality and purity of the final product. Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over its shelf life.

BLA Submission and Review by the FDA

Assuming successful completion of all required testing in accordance with all applicable regulatory requirements, the results of product development, nonclinical studies and clinical trials are submitted to the FDA as part of a BLA requesting approval to market the product for one or more indications. The BLA must include all relevant data available from preclinical and clinical studies, including negative or ambiguous results as well as positive findings, together with detailed information relating to the product’s chemistry, manufacturing, controls, and proposed labeling, among other things. Data can come from company-sponsored clinical studies intended to test the safety and effectiveness of a use of the product, or from a number of alternative sources, including studies initiated by investigators. The submission of a BLA requires payment of a substantial user fee to FDA, and the sponsor of an approved BLA is also subject to an annual program fee. A waiver of user fees may be obtained under certain limited circumstances, such as for products designated as orphan drugs, unless the product also includes a non-orphan indication.

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Once a BLA has been submitted, within 60 days, the FDA first reviews the BLA to determine if it is substantially complete before the FDA accepts it for filing. The FDA may refuse to file any BLA that it deems incomplete or not properly reviewable at the time of submission and may request additional information. In this event, the BLA must be resubmitted with the additional information. Once a BLA has been accepted for filing, the FDA’s goal is to review standard applications within ten months after the filing date, or, if the application qualifies for priority review, six months after the filing date. Priority review designation will direct overall attention and resources to the evaluation of applications for products that, if approved, would be significant improvements in the safety or effectiveness of the treatment, diagnosis, or prevention of serious diseases or conditions. In both standard and priority reviews, the review process may be significantly extended by FDA requests for additional information or clarification. The FDA reviews a BLA to determine, among other things, whether a product is safe, pure and potent and the facility in which it is manufactured, processed, packed, or held meets standards designed to assure the product’s continued safety, purity and potency. The FDA may also convene an advisory committee to provide clinical insight on application review questions. The FDA is not bound by recommendations of an advisory committee, but it considers such recommendations when making decisions regarding approval.

Before approving a BLA, the FDA will typically inspect the facility or facilities where the product is manufactured. Additionally, before approving a BLA, the FDA will typically inspect one or more clinical sites to assure compliance with GCP. After the FDA evaluates a BLA and conducts inspections of manufacturing facilities where the investigational product and/or its drug substance will be produced, the FDA may issue an approval letter or a Complete Response Letter. An approval letter authorizes commercial marketing of the product with specific prescribing information for specific indications. A Complete Response Letter will describe all of the deficiencies that the FDA has identified in the BLA, except that where the FDA determines that the data supporting the application are inadequate to support approval, the FDA may issue the Complete Response Letter without first conducting any required inspections, testing submitted product lots, and/or reviewing proposed labeling. In issuing the Complete Response Letter, the FDA may recommend actions that the applicant might take to place the BLA in condition for approval, including requests for additional information or clarification. The FDA may delay or refuse approval of a BLA if applicable regulatory criteria are not satisfied, require additional testing or information and/or require post-marketing testing and surveillance to monitor safety or efficacy of a product.

If approval, which with respect to biological products, is referred to as licensure, of a product is granted, such approval will be granted for particular indications and may entail limitations on the indicated uses for which such product may be marketed. For example, the FDA may approve the BLA with a Risk Evaluation and Mitigation Strategy (“REMS”), to ensure the benefits of the product outweigh its risks. A REMS is a safety strategy to manage a known or potential serious risk associated with a medicine and to enable patients to have continued access to such medicines by managing their safe use, and could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries, and other risk minimization tools. The FDA also may condition approval on, among other things, changes to proposed labeling or the development of adequate controls and specifications. The FDA may also require one or more Phase 4 post-market studies and surveillance to further assess and monitor the product’s safety and effectiveness after commercialization, and may limit further marketing of the product based on the results of these post-marketing studies.

In addition, the Pediatric Research Equity Act (“PREA”), requires a sponsor to conduct pediatric clinical trials for most drugs, for a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration. Under PREA, original BLAs and supplements must contain a pediatric assessment unless the sponsor has received a deferral or waiver. The required assessment must evaluate the safety and effectiveness of the product for the claimed indications in all relevant pediatric subpopulations and support dosing and administration for each pediatric subpopulation for which the product is safe and effective. The sponsor or FDA may request a deferral of pediatric clinical trials for some or all of the pediatric subpopulations. A deferral may be granted for several reasons, including a finding that the drug is ready for approval for use in adults before

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pediatric clinical trials are complete or that additional safety or effectiveness data needs to be collected before the pediatric clinical trials begin. The FDA must send a non-compliance letter to any sponsor that fails to submit the required assessment, keep a deferral current or fails to submit a request for approval of a pediatric formulation.

Expedited Development and Review Programs

A sponsor may seek approval of its product candidate under programs designed to expedite FDA’s review and approval of new drugs and biological products that meet certain criteria. Specifically, new drugs and biological products are eligible for fast track designation if they are intended to treat a serious or life-threatening disease or condition and demonstrate the potential to address unmet medical needs for the disease or condition. The sponsor of a fast track product candidate has opportunities for more frequent interactions with the applicable FDA review team during product development and, once a BLA is submitted, the FDA may consider sections of the application for review on a rolling basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the application, the FDA agrees to accept sections of the application and determines that the schedule is acceptable and the sponsor pays any required user fees upon submission of the first section of the application. A fast track-designated product candidate may also qualify for priority review, under which the FDA sets the target date for FDA action on the BLA at six months after the FDA accepts the application for filing. Priority review is granted when there is evidence that the proposed product would offer a significant improvement in the safety or effectiveness of the treatment, diagnosis or prevention of a serious disease or condition. If criteria are not met for priority review, the application is subject to the standard FDA review period of 10 months after FDA accepts the application for filing.

A product candidate intended to treat a serious or life-threatening disease or condition may also be eligible for breakthrough therapy designation to expedite its development and review. A product candidate can receive breakthrough therapy designation if preliminary clinical evidence indicates that the product candidate may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. The designation includes all of the fast track program features, as well as more intensive FDA interaction and guidance beginning as early as Phase 1 and an organizational commitment to expedite the development and review of the product, including involvement of senior managers.

In addition, under the accelerated approval program, the FDA may approve a BLA for a product candidate intended to treat serious or life-threatening diseases or conditions upon a determination that the product candidate has an effect on either a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments. As a condition of approval, the FDA generally requires that sponsors of a product receiving accelerated approval perform adequate and well-controlled confirmatory trials verify and describe the biologic’s clinical benefit in relationship to the surrogate endpoint or ultimate outcome in relationship to the clinical benefit. In addition, the FDA currently requires as a condition for accelerated approval pre-approval of promotional materials, which could adversely impact the timing of the commercial launch of the product. FDA may withdraw approval of a biologic or indication approved under accelerated approval on an expedited basis if, for example, the confirmatory trial fails to verify the predicted clinical benefit of the product or if the sponsor fails to conduct such trials in a timely manner.

In 2017, the FDA established the regenerative medicine advanced therapy (“RMAT”), which is intended to fulfill the 21st Century Cures Act requirement that the FDA facilitate an efficient development program for, and expedite review of, any drug or biologic that meets the following criteria: (i) the biologic qualifies as a RMAT, which is defined as a cell therapy, therapeutic tissue engineering product, human cell and tissue product, or any combination product using such therapies or products, with limited exceptions; (ii) the biologic is intended to treat, modify, reverse, or cure a serious or life-threatening disease or condition; and (iii) preliminary clinical

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evidence indicates that the biologic has the potential to address unmet medical needs for such a disease or condition. RMAT designation provides all the benefits of breakthrough therapy designation, including more frequent meetings with the FDA to discuss the development plan for the product candidate and eligibility for rolling review and priority review. Product candidates granted RMAT designation may also be eligible for accelerated approval on the basis of a surrogate or intermediate endpoint reasonably likely to predict long-term clinical benefit, or reliance upon data obtained from a meaningful number of clinical trial sites, including through expansion of trials to additional sites.

Fast track designation, priority review, accelerated approval, RMAT designation and breakthrough therapy designation do not change the standards for approval but may expedite the development or approval process. Even if a product qualifies for one or more of these programs, the FDA may later decide that the product no longer meets the conditions for qualification or decide that the time period for FDA review or approval will not be shortened.

Orphan Drug Designation and Exclusivity

Under the Orphan Drug Act, the FDA may grant orphan designation to a drug or biologic intended to treat a rare disease or condition, defined as a disease or condition with a patient population of fewer than 200,000 individuals in the United States, or a patient population greater than 200,000 individuals in the United States and when there is no reasonable expectation that the cost of developing and making available the drug or biologic in the United States will be recovered from sales in the United States for that drug or biologic. Orphan drug designation must be requested before submitting a BLA. After the FDA grants orphan drug designation, the generic identity of the therapeutic agent and its potential orphan use are disclosed publicly by the FDA.

If a product that has orphan drug designation subsequently receives the first FDA approval for a particular active ingredient for the disease for which it has such designation, the product is entitled to orphan product exclusivity, which means that the FDA may not approve any other applications, including a full BLA, to market the same biologic for the same disease or condition for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity or if the FDA finds that the holder of the orphan drug exclusivity has not shown that it can assure the availability of sufficient quantities of the orphan drug to meet the needs of patients with the disease or condition for which the drug was designated. Orphan drug exclusivity does not prevent the FDA from approving a different drug or biologic for the same disease or condition, or the same drug or biologic for a different disease or condition. Among the other benefits of orphan drug designation are tax credits for certain research and a waiver of the BLA application user fee.

A designated orphan drug may not receive orphan drug exclusivity if it is approved for a use that is broader than the disease or condition for which it received orphan designation. In addition, orphan drug exclusive marketing rights in the United States may be lost if the FDA later determines that the request for designation was materially defective or, as noted above, if the second applicant demonstrates that its product is clinically superior to the approved product with orphan exclusivity or the manufacturer of the approved product is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition.

Post-Approval Requirements

Any products manufactured or distributed pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including, among other things, requirements relating to record-keeping, reporting of adverse experiences, periodic reporting, product sampling and distribution, and advertising and promotion of the product. After approval, most changes to the approved product, such as adding new indications or other labeling claims, are subject to prior FDA review and approval. There also are continuing, annual program fees for any marketed products.

Biologic manufacturers and their subcontractors are required to register their establishments with the FDA and certain state agencies, and are subject to periodic unannounced inspections by the FDA and certain state

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agencies for compliance with cGMP, which impose certain procedural and documentation requirements upon BLA holders and their third-party manufacturers. Changes to the manufacturing process are strictly regulated, and, depending on the significance of the change, may require prior FDA approval before being implemented. FDA regulations also require investigation and correction of any deviations from cGMP and impose reporting requirements upon us and any third-party manufacturers that we may decide to use. Accordingly, manufacturers must continue to expend time, money and effort in the area of production and quality control to maintain compliance with cGMP and other aspects of regulatory compliance.

The FDA may withdraw approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market. Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information; imposition of post-market studies or clinical studies to assess new safety risks; or imposition of distribution restrictions or other restrictions under a REMS program. Other potential consequences include, among other things:

The FDA closely regulates the marketing, labeling, advertising and promotion of biologics. A company can make only those claims relating to safety and efficacy, purity and potency that are approved by the FDA and in accordance with the provisions of the approved label. The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses. Failure to comply with these requirements can result in, among other things, adverse publicity, warning letters, corrective advertising and potential civil and criminal penalties. Physicians may prescribe legally available products for uses that are not described in the product’s labeling and that differ from those tested by us and approved by the FDA. Such off-label uses are common across medical specialties. Physicians may believe that such off-label uses are the best treatment for many patients in varied circumstances. The FDA does not regulate the behavior of physicians in their choice of treatments. The FDA does, however, restrict manufacturer’s communications on the subject of off-label use of their products.

Biosimilars and Exclusivity

The Affordable Care Act (“ACA”), signed into law in 2010, includes the Biologics Price Competition and Innovation Act (the “BPCIA”), which created an abbreviated approval pathway for biological products that are biosimilar to or interchangeable with an FDA-licensed reference biological product. The FDA has issued several guidance documents outlining an approach to review and approval of biosimilars. Biosimilarity, which requires

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that there be no clinically meaningful differences between the biological product and the reference product in terms of safety, purity, and potency, can be shown through analytical studies, animal studies, and a clinical study or studies. Interchangeability requires that a product is biosimilar to the reference product and the product must demonstrate that it can be expected to produce the same clinical results as the reference product in any given patient and, for products that are administered multiple times to an individual, the biologic and the reference biologic may be alternated or switched after one has been previously administered without increasing safety risks or risks of diminished efficacy relative to exclusive use of the reference biologic.

Under the BPCIA, an application for a biosimilar product may not be submitted to the FDA until four years following the date that the reference product was first licensed by the FDA. In addition, the approval of a biosimilar product may not be made effective by the FDA until 12 years from the date on which the reference product was first licensed. During this 12-year period of exclusivity, another company may still market a competing version of the reference product if the FDA approves a full BLA for the competing product containing that applicant’s own preclinical data and data from adequate and well-controlled clinical trials to demonstrate the safety, purity and potency of its product. The BPCIA also created certain exclusivity periods for biosimilars approved as interchangeable products. At this juncture, it is unclear whether products deemed “interchangeable” by the FDA will, in fact, be readily substituted by pharmacies, which are governed by state pharmacy law.

A biological product can also obtain pediatric market exclusivity in the United States. Pediatric exclusivity, if granted, adds six months to existing exclusivity periods and patent terms. This six-month exclusivity, which runs from the end of other exclusivity protection or patent term, may be granted based on the voluntary completion of a pediatric study in accordance with an FDA-issued “Written Request” for such a study.

FDA Regulation of Companion Diagnostics

Our product candidates may require use of an in vitro diagnostic to identify appropriate patient populations. These diagnostics, often referred to as companion diagnostics, are regulated as medical devices. In the United States, the FDCA, and its implementing regulations, and other federal and state statutes and regulations govern, among other things, medical device design and development, preclinical and clinical testing, premarket clearance or approval, registration and listing, manufacturing, labeling, storage, advertising and promotion, sales and distribution, export and import and post-market surveillance. Unless an exemption applies, companion diagnostic tests require marketing clearance or approval from the FDA prior to commercial distribution. The two primary types of FDA marketing authorization applicable to a medical device are premarket notification, also called 510(k) clearance, and premarket approval (“PMA”).

If use of companion diagnostic is essential to safe and effective use of a drug or biologic product, then the FDA generally will require approval or clearance of the diagnostic contemporaneously with the approval of the therapeutic product. On August 6, 2014, the FDA issued a final guidance document addressing the development and approval process for “In Vitro Companion Diagnostic Devices.” According to the guidance, for novel candidates such as our product candidates, a companion diagnostic device and its corresponding drug or biologic candidate should be approved or cleared contemporaneously by FDA for the use indicated in the therapeutic product labeling. The guidance also explains that a companion diagnostic device used to make treatment decisions in clinical trials of a drug generally will be considered an investigational device, unless it is employed for an intended use for which the device is already approved or cleared. If used to make critical treatment decisions, such as patient selection, the diagnostic device generally will be considered a significant risk device under the FDA’s Investigational Device Exemption (“IDE”) regulations. Thus, the sponsor of the diagnostic device will be required to comply with the IDE regulations. According to the guidance, if a diagnostic device and a drug are to be studied together to support their respective approvals, both products can be studied in the same investigational study, if the study meets both the requirements of the IDE regulations and the IND regulations. The guidance provides that depending on the details of the study plan and subjects, a sponsor may seek to submit an IND alone, or both an IND and an IDE. In July 2016, the FDA issued a draft guidance document intended to

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further assist sponsors of therapeutic products and sponsors of in vitro companion diagnostic devices on issues related to co-development of these products.

The FDA generally requires companion diagnostics intended to select the patients who will respond to cancer treatment to obtain approval of a PMA for that diagnostic contemporaneously with approval of the therapeutic. The review of these in vitro companion diagnostics in conjunction with the review of therapeutic candidates such as those we are developing involves coordination of review by the FDA’s Center for Drug Evaluation and Research and by the FDA’s Center for Devices and Radiological Health. The PMA process, including the gathering of clinical and pre-clinical data and the submission to and review by the FDA, can take several years or longer. It involves a rigorous premarket review during which the applicant must prepare and provide the FDA with reasonable assurance of the device’s safety and effectiveness and information about the device and its components regarding, among other things, device design, manufacturing and labeling. PMA applications are also subject to an application fee. In addition, PMAs for certain devices must generally include the results from extensive pre-clinical and adequate and well-controlled clinical trials to establish the safety and effectiveness of the device for each indication for which FDA approval is sought. In particular, for a diagnostic, the applicant must demonstrate that the diagnostic produces reproducible results when the same sample is tested multiple times by multiple users at multiple laboratories. In addition, as part of the PMA review, the FDA will typically inspect the manufacturer’s facilities for compliance with the Quality System Regulation (“QSR”), which imposes elaborate testing, control, documentation and other quality assurance requirements.

If the FDA evaluations of both the PMA application and the manufacturing facilities are favorable, the FDA will either issue an approval letter or an approvable letter, which usually contains a number of conditions that must be met in order to secure the final approval of the PMA, such as changes in labeling, or specific additional information, such as submission of final labeling, in order to secure final approval of the PMA. If the FDA concludes that the applicable criteria have been met, the FDA will issue a PMA for the approved indications, which can be more limited than those originally sought by the applicant. The PMA can include post-approval conditions that the FDA believes necessary to ensure the safety and effectiveness of the device, including, among other things, restrictions on labeling, promotion, sale and distribution.

If the FDA’s evaluation of the PMA or manufacturing facilities is not favorable, the FDA will issue an order denying approval of the PMA or issue a not approvable order. A not approvable letter will outline the deficiencies in the application and, where practical, will identify what is necessary to make the PMA approvable. The FDA may also determine that additional clinical trials are necessary, in which case the PMA approval may be delayed for several months or years while the trials are conducted and then the data submitted in an amendment to the PMA. Once granted, PMA approval may be withdrawn by the FDA if compliance with post approval requirements, conditions of approval or other regulatory standards is not maintained or problems are identified following initial marketing. PMA approval is not guaranteed, and the FDA may ultimately respond to a PMA submission with a not approvable determination based on deficiencies in the application and require additional clinical trial or other data that may be expensive and time-consuming to generate and that can substantially delay approval.

After a device is placed on the market, it remains subject to significant regulatory requirements. Medical devices may be marketed only for the uses and indications for which they are cleared or approved. Device manufacturers must also establish registration and device listings with the FDA. A medical device manufacturer’s manufacturing processes and those of its suppliers are required to comply with the applicable portions of the QSR, which cover the methods and documentation of the design, testing, production, processes, controls, quality assurance, labeling, packaging and shipping of medical devices. Domestic facility records and manufacturing processes are subject to periodic unscheduled inspections by the FDA. The FDA also may inspect foreign facilities that export products to the United States.

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Other Healthcare Laws

Pharmaceutical manufacturers are subject to additional healthcare regulation and enforcement by the federal government and by authorities in the states and foreign jurisdictions in which they conduct their business. Such laws may include, without limitation, the U.S. federal anti-kickback, fraud and abuse, false claims, consumer fraud, pricing reporting, and transparency laws and regulations as well as similar state and foreign laws in the jurisdictions outside the U.S. Violation of any such laws or any other governmental regulations that apply may result in penalties, including, without limitation, significant administrative, civil and criminal penalties, damages, fines, disgorgement, reputational harm, additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws, the curtailment or restructuring of operations and exclusion from participation in governmental healthcare programs and imprisonment.

Coverage and Reimbursement

In the United States and markets in other countries, patients generally rely on third-party payors to reimburse all or part of the costs associated with their treatment. Sales of any pharmaceutical product depend, in part, on the extent to which such product will be covered by third-party payors, such as federal, state and foreign government healthcare programs, commercial insurance and managed healthcare organizations, and the level of reimbursement for such product by third-party payors.

Significant uncertainty exists as to the coverage and reimbursement status of any newly approved product. Adequate coverage and reimbursement from governmental healthcare programs, such as Medicare and Medicaid, and commercial payors are critical to new product acceptance. The availability of coverage and extent of reimbursement by governmental and private payors are essential for most patients to be able to afford treatments. Decisions regarding the extent of coverage and amount of reimbursement to be provided are made on a plan-by-plan basis. In the U.S., the Medicare program, which is administered by the Centers for Medicare & Medicaid Services (“CMS”), an agency within the U.S. Department of Health and Human Services (“HHS”), is increasingly used as a model for how commercial and other governmental payors develop their own coverage and reimbursement policies for new drugs and biologics. One third-party payor’s decision to cover a particular product, however, does not ensure that other payors will also provide coverage for the product. As a result, the coverage determination process can require manufactures to provide scientific and clinical support for the use of a product to each payor separately and can be a time-consuming process, with no assurance that coverage and adequate reimbursement will be applied consistently or obtained in the first instance. For products administered under the supervision of a physician, obtaining coverage and adequate reimbursement may be particularly difficult because of the higher prices often associated with such drugs. Additionally, separate reimbursement for the product itself or the treatment or procedure in which the product is used may not be available, which may impact physician utilization. In addition, companion diagnostic tests require coverage and reimbursement separate and apart from the coverage and reimbursement for their companion pharmaceutical or biological products. Similar challenges to obtaining coverage and reimbursement, applicable to pharmaceutical or biological products, will apply to companion diagnostics.

In addition, third-party payors are increasingly reducing reimbursements for pharmaceutical products and services. The U.S. government and state legislatures have continued implementing cost-containment programs, including price controls, restrictions on coverage and reimbursement and requirements for substitution of generic products. Third-party payors are more frequently challenging the prices charged, examining the medical necessity and reviewing the cost-effectiveness of pharmaceutical products and biologics, in addition to questioning their safety and efficacy. Adoption of price controls and cost-containment measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could further limit sales of any product. Decreases in third-party reimbursement for any product or a decision by a third-party payor not to cover a product could reduce physician usage and patient demand for the product.

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In international markets, reimbursement and healthcare payment systems vary significantly by country, and many countries have instituted price ceilings on specific products and therapies. For example, the European Union provides options for its member states to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use. A member state may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market. Pharmaceutical products may face competition from lower-priced products in foreign countries that have placed price controls on pharmaceutical products and may also compete with imported foreign products. Furthermore, there is no assurance that a product will be considered medically reasonable and necessary for a specific indication, will be considered cost-effective by third-party payors, that an adequate level of reimbursement will be established even if coverage is available or that the third-party payors’ reimbursement policies will not adversely affect the ability for manufacturers to sell products profitably. Historically, products launched in the European Union do not follow price structures of the U.S. and generally prices tend to be significantly lower.

Healthcare Reform

In the United States and certain foreign jurisdictions, there have been, and we expect there will continue to be, a number of legislative and regulatory changes to the healthcare system. In March 2010, the ACA was signed into law, which substantially changed the way healthcare is financed by both governmental and private insurers in the United States. By way of example, the ACA increased the minimum level of Medicaid rebates payable by manufacturers of brand name drugs from 15.1% to 23.1%; required collection of rebates for drugs paid by Medicaid managed care organizations; imposed a non-deductible annual fee on pharmaceutical manufacturers or importers who sell certain “branded prescription drugs” to specified federal government programs, implemented a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted, or injected; expanded eligibility criteria for Medicaid programs; creates a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research; and established a Center for Medicare Innovation at CMS to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending.

Since its enactment, there have been judicial, executive and Congressional challenges to certain aspects of the ACA. On June 17, 2021, the United States Supreme Court dismissed the judicial challenge to the ACA without specifically ruling on the constitutionality of the ACA. Prior to the United States Supreme Court’s decision, President Biden issued an executive order to initiate a special enrollment period from February 15, 2021 through August 15, 2021 for purposes of obtaining health insurance coverage through the ACA marketplace. The executive order also instructed certain governmental agencies to review and reconsider their existing policies and rules that limit access to healthcare, including among others, reexamining Medicaid demonstration projects and waiver programs that include work requirements, and policies that create unnecessary barriers to obtaining access to health insurance coverage through Medicaid or the ACA. Other legislative changes have been proposed and adopted since the ACA was enacted, including aggregate reductions of Medicare payments to providers, which will remain in effect through 2032, with the exception of a temporary suspension from May 1, 2020 through March 31, 2022, absent additional Congressional action.

There has also been increasing legislative and enforcement interest in the United States with respect to specialty drug pricing practices. Specifically, there have been several recent U.S. Congressional inquiries and proposed federal and state legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under Medicare, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drugs. Most recently, on August 16, 2022, the Inflation Reduction Act of 2022 (“IRA”) was signed into law. Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); and replaces the Part D coverage gap discount

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program with a new discounting program (beginning in 2025). The IRA permits the Secretary of the HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years. For that and other reasons, it is currently unclear how the IRA will be effectuated, and the impact of the IRA on our business and the pharmaceutical industry cannot yet be fully determined.

In addition, individual states in the United States have also become increasingly active in implementing regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures and, in some cases, mechanisms to encourage importation from other countries and bulk purchasing. Furthermore, there has been increased interest by third party payors and governmental authorities in reference pricing systems and publication of discounts and list prices. Further regulatory changes include passage of the Right to Try Act on May 30, 2018. The law, among other things, provides a federal framework for certain patients to access certain investigational new medical products that have completed a Phase 1 clinical trial and that are undergoing investigation for FDA approval. Under certain circumstances, eligible patients can seek treatment without enrolling in clinical trials and without obtaining FDA permission under the FDA expanded access program. There is no obligation for a pharmaceutical manufacturer to make its drug products available to eligible patients as a result of the Right to Try Act.

We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our products once approved or additional pricing pressures. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability or commercialize our product candidates.

Data Privacy and Security Laws

Numerous state, federal and foreign laws, regulations and standards govern the collection, use, access to, confidentiality and security of health-related and other personal information, and could apply now or in the future to our operations or the operations of our partners. In the United States, numerous laws and regulations, including data breach notification laws, health information privacy and security laws and consumer protection laws and regulations govern the collection, use, disclosure, and protection of health-related and other personal information. In addition, certain foreign laws govern the privacy and security of personal data, including health-related data. Privacy and security laws, regulations, and other obligations are constantly evolving, may conflict with each other to complicate compliance efforts, and can result in investigations, proceedings, or actions that lead to significant civil and/or criminal penalties and restrictions on data processing.

Employee and Human Capital Resources

In connection with the strategic reprioritization and restructuring approved by our Board on November 30, 2022, we announced a workforce reduction of approximately 60%. On September 29, 2023, our Board approved an additional workforce reduction of approximately 80% of the remaining employees. As of January 1, 2024, we had no full-time and no part-time employees. We have provided both cash and equity-based retention incentives to retain officers and consultants following the restructuring. None of our officers or consultants are represented by a labor union or covered by a collective bargaining agreement. We consider our relationship with our officers and consultants to be good. We believe our success depends on our ability to attract, retain, develop and motivate highly skilled personnel. In particular, we depend upon the personal efforts and abilities of the principal members of our senior management to partner effectively as a team, and who provide strategic direction, develop our business, manage our operations and maintain a cohesive and stable work environment.

Quantitative and Qualitative Disclosures About Market Risk

As of December 31, 2022 and September 30, 2023, the Company had cash and cash equivalents of $63.7 million and $10.2 million, respectively, which consisted of cash and money market funds. Interest income

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is sensitive to changes in the general level of interest rates; however, due to the nature of these balances, an immediate 10% change in interest rates would not have a material effect on the fair market value of the Company’s cash and cash equivalents.

The Company is not currently exposed to significant market risk related to changes in foreign currency exchange rates. The Company’s operations may be subject to fluctuations in foreign currency exchange rates in the future.

The Company does not believe that inflation has had a material effect on our business, financial condition or results of operations. The Company’s operations may be subject to inflation in the future.

Properties

The Company does not have a principal office location and does not lease any additional office or lab space, although the Company leases warehouse space.

Legal Proceedings

The Company is not subject to any material legal proceedings.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

Unless the context otherwise requires, all references in this section to the “Company,” “we,” “us” or “our” refer to SQZ Biotechnologies Company and its wholly owned subsidiaries. You should read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and related notes appearing at the end of this proxy statement, our Annual Report on Form 10-K for the year ended December 31, 2022 and our Quarterly Report on Form 10-Q for the quarter ended September 30, 2023. Some of the information contained in this discussion and analysis or set forth elsewhere in this proxy statement, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section of this proxy statement, our Annual Report on Form 10-K for the year ended December 31, 2022 and our subsequent Quarterly Reports on Form 10-Q, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

We are a clinical-stage biotechnology company focused on unlocking the full potential of cell therapies to benefit patients with cancer and other serious medical conditions. The company was founded on the therapeutic potential of Cell Squeeze^®, our proprietary technology which allows for rapid delivery of a variety of cargo into different cell types. We aim to create multiple cell therapies that drive the immune system to combat diseases.

On November 30, 2022, the Board approved the 2022 Restructuring Plan of our clinical portfolio to concentrate on the development of our second-generation enhanced Antigen Presenting Cells (eAPC) cell therapy program, focused on HPV16 positive recurrent, locally advanced, or metastatic solid tumors and reduce our workforce by approximately 60 percent. On November 30, 2022, the Board appointed Howard Bernstein, MD, PhD, our director and former Chief Scientific Officer, as Interim Chief Executive Officer.

On July 3, 2023, we received a written notice from the NYSE notifying us that the NYSE commenced proceedings to delist our Common Stock from the NYSE. The NYSE reached this determination pursuant to Section 802.01B of the NYSE’s Listed Company Manual because the Company had fallen below the NYSE’s continued listing standard requiring listed companies to maintain an average global market capitalization of at least $15 million over a consecutive 30-trading day period. The NYSE suspended trading in the Company’s Common Stock immediately after market close on July 3, 2023. Our Common Stock began trading in the over-the-counter markets, under the symbol SQZB, commencing on July 5, 2023. The over-the-counter markets are significantly more limited than the NYSE, and quotation on the over-the-counter markets may result in a less liquid market available for existing and potential securityholders to trade the Common Stock and could further depress the trading price of the Common Stock. We can provide no assurance that the Common Stock will continue to trade on the over-the-counter markets, whether broker-dealers will continue to provide public quotes of the Common Stock or whether the trading volume of the Common Stock will be sufficient to provide for an efficient trading market.

On July 25, 2023, we announced that Roche determined that Roche will not exercise its option under the License and Collaboration Agreement, dated October 5, 2018, by and between us and Roche, to obtain an exclusive license to develop and commercialize the Company’s candidate targeting HPV 16 positive solid tumors under our SQZ-APC-HPV program. On September 13, 2023, we and Roche agreed to terminate the 2018 Roche Agreement, effective immediately. No early termination penalty was incurred by either party. As of September 13, 2023, we regained full clinical development and future commercialization rights for our programs targeting HPV 16 positive tumors. We also announced that we intend to explore potential strategic alternatives to support the advancement of our oncology programs including HPV 16 positive tumors, in an effort to allow us to partner all our clinical and preclinical assets across all disease areas and indications.

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On September 29, 2023, the Board approved the 2023 Restructuring Plan and ceased substantially all research and development activities to reduce our ongoing operating expenses while we pursued strategic alternatives. Should a strategic alternative be implemented, we anticipate using available net proceeds to discharge our liabilities and outstanding obligations, distribute the remainder, if any, to stockholders and wind down our operations. Should we be unable to identify and implement a meaningful strategic alternative in a timely manner, the Board is likely to consider bankruptcy or other dissolution proceedings. In connection with the 2023 Restructuring Plan, we determined to continue to dose existing patients in our clinical programs through November 2023 and to discontinue enrollment of new patients in our clinical trials.

Other Developments

Since our inception, we have focused substantially all of our resources on building our Cell Squeeze technology, establishing and protecting our intellectual property portfolio, conducting research and development activities, developing our manufacturing process and manufacturing product candidate materials, preparing for and initiating clinical trials of our product candidates, organizing and staffing our company, business planning, raising capital and providing general and administrative support for these operations. We do not have any products approved for sale and have not generated any revenue from product sales.

In November 2020, we completed our initial public offering (“IPO”) pursuant to which we issued and sold 5,073,529 shares of common stock, inclusive of 661,764 shares sold by us pursuant to the full exercise of the underwriters’ option to purchase additional shares. We received aggregate net proceeds of approximately $75.5 million from the IPO, after deducting underwriting discounts and commissions, but before deducting offering costs payable by us, which were $2.6 million. In February 2021, we completed a public offering, or the follow-on public offering completed February 17, 2021 (the “Follow-on Offering”), pursuant to which we issued and sold 3,000,000 shares of Common Stock. We received aggregate net proceeds of approximately $56.4 million, after deducting underwriting discounts and commissions, but before deducting offering costs payable by us, which were $0.8 million. On November 10, 2021, we entered into an Open Market Sales Agreement (the “Sales Agreement”) with Jefferies LLC (“Jefferies”) to issue and sell up to $75,000,000 in shares of our common stock from time to time during the term of the Sales Agreement through an “at-the-market” equity offering program under which Jefferies acts as our sales agent (the “ATM Facility”). During the year ended December 31, 2022, we sold 1,261,226 shares of common stock under the ATM Facility for net proceeds of approximately $4.1 million.

Through September 30, 2023, we have funded our operations primarily with upfront and milestone payments received under our collaboration agreements with Roche and with proceeds from equity and debt offerings, most recently from our IPO, the Follow-on Offering and the ATM Facility.

Since our inception, we have incurred significant operating losses. We reported a net loss of $79.5 million for the year ended December 31, 2022 and $58.1 million for the nine months ended September 30, 2023. As of December 31, 2022 and September 30, 2023, we had an accumulated deficit of $275.0 million and $333.1 million, respectively. Although we anticipate reduced expenses for the remainder of 2023, we expect to continue to incur significant expenses.

As of March 22, 2023 and November 8, 2023, the issuance date of the consolidated financial statements for the year ended December 31, 2022 and the interim condensed consolidated financial statements for the three and nine months ended September 30, 2023, respectively, included elsewhere in this proxy statement, based on our recurring losses from operations incurred since inception, expectation of continuing operating losses for the foreseeable future and the need to raise additional capital to finance future operations, our management has concluded that there is substantial doubt about our ability to continue as a going concern for a period of one year from the date that the condensed consolidated financial statements are issued. See “—Liquidity and Capital Resources.”

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Impact of Macroeconomic Conditions

The global economy, including credit and financial markets, has recently experienced extreme volatility and disruptions, including, for example, severely diminished liquidity and credit availability, rising interest and inflation rates, crises involving banking and financial institutions, declines in consumer confidence, declines in economic growth, increases in unemployment rates, uncertainty about economic stability and uncertainty created by geopolitical conflict, war and terrorism. We are monitoring the potential impact of general economic conditions on our business and financial statements. Unstable market and economic conditions or pandemics may have serious adverse consequences on our business, financial condition and results of operations.

On September 29, 2023, as noted above, the Board approved a reduction in our workforce by approximately 80%. In addition, we completed an evaluation of the impact of the reduction in the workforce on the carrying value of our long-lived assets, including our headquarters facility operating lease asset. This process included evaluating the estimated remaining lives, significant changes in the use, and potential impairment charges related to its long-lived assets. Based on our evaluation, we determined that the facility operating lease asset was impaired and recorded a $6.0 million charge as of September 30, 2023.

As a result of the impact of the 2023 Restructuring, including the reduction in force and the anticipated cessation of remaining research and clinical activities in the fourth quarter of 2023, we determined that we would no longer require the use of our headquarters facility. As noted in Note 13 “Subsequent Event”, in the interim condensed consolidated financial statements for the three and nine months ended September 30, 2023 included elsewhere in this proxy statement, on November 6, 2023, in exchange for a commitment that we vacate the facility by mid-November 2023, payment of one quarter of the November 2023 Base Rent, as defined by such lease, and certain common area maintenance and utility fees, release of a $2.3 million letter of credit securing our performance under the lease and a lump sum payment of $1.0 million by a certain date following the closing of a strategic transaction, the landlord has agreed to discharge the lease and release us from remaining payment obligations under the lease. In the event the lump sum is not paid when due, outstanding obligations under the lease will remain in full force.

Components of Our Results of Operations

Revenue

To date, we have not generated any revenue from product sales. All of our revenue to date has been derived from three collaboration agreements with Roche, which we entered into in 2015, 2017 and 2018, and, to a lesser extent, from government grants.

Collaboration Revenue

2017 License and Collaboration Agreement with Roche

In April 2017, we entered into a second license and collaboration agreement with Roche (the “2017 Roche Agreement”) to allow Roche to use our Cell Squeeze technology to enable gene editing of immune cells to discover new targets in cancer immunotherapy. The 2017 Roche Agreement includes several licenses granted by Roche to us and by us to Roche in order to conduct a specified research program in accordance with a specified research plan.

Under the agreement, we received an upfront payment of $5.0 million as a technology access fee and are entitled to (i) payments of up to $1.0 million as reimbursement for our research costs; (ii) milestone payments of up to $7.0 million upon the achievement of specified development milestones; and (iii) annual maintenance fees ranging from $0.5 million to $0.9 million for each year following the fifth anniversary of the effective date, subject to specified prepayment discounts.

In early 2022, all active work streams under the 2017 Roche Agreement were concluded and the agreement was terminated. As of December 31, 2021, we determined that we expected to incur no additional costs to satisfy the remaining performance obligations under the 2017 Roche Agreement and we recognized revenue of $1.2 million under the 2017 Roche Agreement. There was no remaining deferred revenue under the 2017 Roche Agreement as of December 31, 2021.

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2018 License and Collaboration Agreement with Roche

In October 2018, we entered into a third license and collaboration agreement with Roche (“the 2018 Roche Agreement”), to jointly develop certain products based on mononuclear antigen presenting cells (“APCs”), including human papilloma virus (“HPV”), using our SQZ APC platform for the treatment of oncology indications. We granted Roche a non-exclusive license to our intellectual property, and Roche granted us a non-exclusive license to its and its affiliates’ intellectual property for the purpose of performing research activities. In connection with this agreement, the parties terminated the original Roche Agreement entered into in 2015.

Under the 2018 Roche Agreement, Roche was granted option rights to obtain an exclusive license to develop APC products or products derived from the collaboration programs on a product-by-product basis in oncology and to develop a Tumor Cell Lysate (“TCL”) product. In July 2023, Roche determined that it would not exercise its option under the 2018 Roche Agreement, to obtain an exclusive license to develop and commercialize the Company’s candidate targeting HPV 16 positive solid tumors under the Company’s SQZ-APC-HPV program. On September 13, 2023, we and Roche agreed to terminate the 2018 Roche Agreement, effective immediately. No early termination penalty was incurred by either party.

Under the 2018 Roche Agreement, we received an upfront payment of $45.0 million and are eligible to receive (i) reimbursement of a mid double-digit percentage of our development costs; (ii) aggregate milestone payments on a product-by-product basis of up to $1.6 billion upon the achievement of specified milestones, consisting of up to $217.0 million of development milestone payments, up to $240.0 million of regulatory milestone payments and up to $1.2 billion of sales milestone payments; and (iii) tiered royalties on annual net sales of APC and TCL products licensed under the agreement at specified rates ranging from a mid single-digit percentage to a percentage in the mid-twenties. We received the upfront payment of $45.0 million in October 2018 upon execution of the agreement. In addition, during the second quarter of 2019, we received a payment of $10.0 million following the achievement of the first development milestone under the 2018 Roche Agreement related to submission by us of preclinical data to the FDA and during the first quarter of 2020, we received a payment of $20.0 million following the achievement of the second development milestone under the 2018 Roche Agreement related to first-patient dosing in a Phase 1 clinical trial. In the fourth quarter of 2021, we became entitled to receive a milestone payment of $3.0 million upon (i) the recommendation by an independent panel that we could advance our SQZ-PBMC-HPV clinical trial to combination therapy with checkpoint initiators and (ii) the initiation of that therapy.

We assessed our accounting for the 2018 Roche Agreement in accordance with Accounting Standards Codification (“ASC”) 606 and identified the following promises under the agreement: (i) a non-exclusive license granted to Roche to use our intellectual property and collaboration compounds to conduct research activities related to the research plans under the 2018 Roche Agreement; (ii) specified research and development services related to HPV through Phase 1 clinical trials under a specified research plan; (iii) manufacturing of our SQZ APC platform and equipment in order to support the HPV research plan; (iv) specified research and development services on next-generation APCs under a research plan; (v) specified research and development services on TCL under a research plan; and (vi) participation on a joint steering committee (“JSC”). We concluded at the outset of the 2018 Roche Agreement that there were three performance obligations under the agreement: (1) the license to our intellectual property, the research and development activities related to HPV through Phase 1 clinical trials under a specified research plan, and the manufacturing of our SQZ APC platform and equipment in order to support the HPV research plan, or the first performance obligation; (2) the license to our intellectual property and the research and development activities on next-generation APCs, or the second performance obligation; and (3) the license to our intellectual property and the research and development activities on TCL, or the third performance obligation. We also concluded that the JSC participation had an immaterial impact on the accounting model.

In addition, we determined that the upfront payment of $45.0 million as well as the reimbursable costs of $10.8 million estimated by us constituted the entirety of the consideration to be included in the transaction price.

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This transaction price of $55.8 million was initially allocated to the three performance obligations based on the relative standalone selling price of each obligation. The potential milestone payments that we may be eligible to receive were excluded from the transaction price at the outset of the arrangement. We reevaluate the transaction price at the end of each reporting period and as uncertain events are resolved or other changes in circumstances occur, and, if necessary, we will adjust our estimate of the transaction price.

We separately recognize revenue associated with each of the three performance obligations as the research, development and manufacturing services are provided using an input method, based on the cumulative costs incurred compared to the total estimated costs expected to be incurred to satisfy each performance obligation. The amounts received from Roche that have not yet been recognized as revenue are deferred as a contract liability in our consolidated balance sheet and will be recognized over the remaining research and development period until each performance obligation is satisfied.

In 2019, we evaluated our overall program priorities and determined that in 2020 we would continue to focus our resources on progressing the specified APC programs related to the 2018 Roche Agreement as well as our AAC and TAC platforms. As a result of our continuing focus on these specific programs, we reduced the level of priority of the TCL research activities under the 2018 Roche Agreement and expect to perform such TCL research activities over a longer time period than as originally expected under the research plan of the agreement. In the fourth quarter of 2022, we determined that based on our internal plans which have not included work on TCL since 2019, and which do not anticipate performing additional work on TCL prior to the expiration of the option right, as well as Roche’s concurrence that no work was performed or expected to be performed in 2023, that we could recognize the deferred revenue of $9.2 million. Accordingly, as of December 31, 2022, there was no deferred revenue associated with the TCL performance obligation.

During the year ended December 31, 2022, there were no significant changes in the total estimated costs expected to be incurred to satisfy the performance obligations under the 2018 Roche Agreement. During the year ended December 31, 2021, the total estimated costs expected to be incurred to satisfy the performance obligations decreased by $7.3 million. We recognized revenue of $21.0 million and $25.8 million during the years ended December 31, 2022 and 2021, respectively, under the 2018 Roche Agreement. As of December 31, 2022 and 2021, we recorded as a contract liability deferred revenue related to the 2018 Roche Agreement of $0.2 million and $21.2 million, respectively, of which $0.2 million and $12.0 million, respectively, were current liabilities. As of December 31, 2022, the research and development services related to the remaining performance obligation was expected to be performed over a remaining period of three to six months.

On July 25, 2023, we announced that Roche determined that it will not exercise its option under the License and Collaboration Agreement, dated October 5, 2018, by and between us and Roche, to obtain an exclusive license to develop and commercialize the Company’s candidate targeting HPV 16 positive solid tumors under our SQZ-APC-HPV program. On September 13, 2023, the 2018 Roche Agreement was terminated. No early termination penalty was incurred by either party. As of September 13, 2023, we regained full clinical development and future commercialization rights for our programs targeting HPV 16 positive tumors. We also announced that we intend to explore potential strategic alternatives to support the advancement of our oncology programs including HPV 16 positive tumors, in an effort to allow us to partner all our clinical and preclinical assets across all disease areas and indications.

During the nine months ended September 30, 2023, as a result of the determination by Roche that it would not exercise its option in relation to the first performance obligation, we concluded that we would incur no further costs to satisfy our performance obligations and as a result we fully recognized the remaining deferred revenue under this agreement. We recognized $0 and $3.5 million during the three months ended September 30, 2023 and 2022, respectively, under this agreement. As of September 30, 2023, we had fully recognized all deferred revenue related to the 2018 Roche Agreement.

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Grant Revenue

We generate revenue from a government contract with the National Institutes of Health (“NIH”), which reimburses us for certain allowable costs for funded projects, plus an agreed upon fee. Revenue from government grants is recognized as the qualifying expenses related to the contracts are incurred, provided that there is reasonable assurance of recoverability. Revenue recognized upon incurring qualifying expenses in advance of receipt of funding is recorded as unbilled receivables, a component of prepaid expenses and other current assets, in our consolidated balance sheet.

Operating Expenses

Research and Development Expenses

Research and development expenses consist primarily of costs incurred for our research activities, including development of our product candidates and costs incurred under our collaboration arrangements with Roche, which include:

We expense research and development costs as incurred. Nonrefundable advance payments that we make for goods or services to be received in the future for use in research and development activities are recorded as prepaid expenses. The prepaid amounts are expensed as the related goods are delivered or the services are performed, or when it is no longer expected that the goods will be delivered or the services rendered. Upfront payments under license agreements are expensed upon receipt of the license, and annual maintenance fees under license agreements are expensed in the period in which they are incurred. Milestone payments under license agreements are accrued, with a corresponding expense being recognized, in the period in which the milestone is determined to be probable of achievement and the related amount is reasonably estimable.

Our direct research and development expenses are tracked on a program-by-program basis and consist of external costs and fees paid to consultants, contractors, CMOs and CROs in connection with our preclinical and clinical development and manufacturing activities. Such program costs also include the external costs of laboratory and consumable materials and costs of raw materials that are directly attributable to and incurred for any single program. We do not allocate employee costs, costs associated with our platform development and discovery efforts, payments made under third-party licensing agreements, costs of laboratory supplies and consumable materials that are not directly attributable to any single program, and facilities expenses, including rent, depreciation and other indirect costs, to specific product development programs because these costs are deployed across multiple programs and our platform technology and, as such, are not separately classified.

Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage

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clinical trials. At this time, we cannot accurately estimate or know the nature, timing and costs of the efforts that will be necessary to complete the preclinical and clinical development of any of our product candidates. The successful development of our product candidates is highly uncertain. This is due to the numerous risks and uncertainties associated with product development, including the following:

A change in the outcome of any of these variables with respect to the development of any of our product candidates could significantly change the costs and timing associated with the development of that product candidate. In addition, we may never succeed in obtaining regulatory approval for any of our product candidates.

General and Administrative Expenses

General and administrative expenses consist primarily of salaries and related costs, including retention incentives and stock-based compensation, for personnel in executive, finance and administrative functions. General and administrative expenses also include direct and allocated facility-related costs as well as professional fees for legal, patent, consulting, investor and public relations, accounting and audit services. We anticipate that we will continue to incur general and administrative expenses as we manage our headcount to support development of our product candidates. We also anticipate that we will incur increased accounting, audit, legal, regulatory, compliance and director and officer insurance costs as well as investor and public relations expenses associated with operating as a public company.

Restructuring Charges

Restructuring charges consist primarily of an impairment charge to the Company’s headquarters facility right of use asset, depreciation expense, employee-related charges including forgiveness of the obligation to repay certain retention payments, and salary and one-time termination benefits to the affected employees, and other costs, as a result of the 2023 Restructuring Plan approved by the Board on September 29, 2023. The 2023

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Restructuring Plan included a workforce reduction of approximately 80%. The workforce reduction affected both research and development and general and administrative functions. We may incur additional costs not currently contemplated due to events that may occur because of, or that are associated with, the 2023 Restructuring Plan.

Other Income (Expense)

Interest Income

Interest income consists of interest earned on our cash equivalents balances.

Other Income (Expense), Net

Other income (expense), net consists of miscellaneous income and expense unrelated to our core operations.

Income Taxes

Since our inception, we have not recorded any income tax benefits for the net losses we have incurred in each year or for our earned research and development tax credits, as we believe, based upon the weight of available evidence, that it is more likely than not that all of our net operating loss (“NOL”), carryforwards and tax credit carryforwards will not be realized. As of December 31, 2022, we had U.S. federal NOL carryforwards of $185.2 million, which may be available to offset future taxable income, of which $11.3 million begin to expire in 2034 and of which $173.9 million do not expire but are generally limited in their usage to an annual deduction equal to 80% of annual taxable income. In addition, as of December 31, 2022, we had state NOL carryforwards of $174.1 million, which may be available to offset future taxable income, of which $171.8 million begin to expire in 2035 and $0.7 million may be carried forward indefinitely. As of December 31, 2022, we also had U.S. federal and state research and development tax credit carryforwards of $10.4 million and $6.2 million which will begin to expire in 2034 and 2030, respectively. We have recorded a full valuation allowance against our net deferred tax assets at each balance sheet date.

Results of Operations

Comparison of the Three Months Ended September 30, 2023 and 2022

The following table summarizes our results of operations for the three months ended September 30, 2023 and 2022:

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Revenue

Collaboration revenue decreased by $3.1 million to $0 for the three months ended September 30, 2023, compared to $3.1 million for the three months ended September 30, 2022. The decrease in collaboration revenue was primarily because we had substantially satisfied the majority of the performance obligations related to the 2018 Roche Agreement as of December 31, 2022. Grant revenue decreased by $0.2 million to $0 for the three months ended September 30, 2023 compared to the three months ended September 30, 2022. The decrease in grant revenue was because we did not perform any government grant related services during the three months ended September 30, 2023.

Research and Development Expenses

Research and development expenses decreased by $9.1 million to $10.5 million for the three months ended September 30, 2023, from $19.6 million for the three months ended September 30, 2022. The net decrease was primarily due to the following:

The decreases in facilities, laboratory and consumable materials and platform-related external services and other costs were due to cost reductions as a result of the implementation of the 2022 Restructuring Plan.

Partially offsetting the above decreases were:

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General and Administrative Expenses

General and administrative expenses decreased by $1.3 million during the three months ended September 30, 2023 to $5.6 million, compared to $6.9 million for the three months ended September 30, 2022. The decrease was primarily due to cost and headcount reductions as a result of the implementation of the 2022 Restructuring Plan.

Restructuring Charges

Restructuring charges for the three months ended September 30, 2023 were $7.6 million, compared to $0 for the three months ended September 30, 2022. The increase in restructuring charges was primarily due to the following:

Interest Income

Interest income for the three months ended September 30, 2023 and 2022 was $0.2 million and $0.4 million, respectively. The decrease in interest income was due to our lower average cash and equivalents balances during 2023 as compared to 2022.

Other Income (Expense), Net

Other income (expense), net for both the three months ended September 30, 2023 and 2022 was not significant.

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Comparison of the Nine Months Ended September 30, 2023 and 2022

The following table summarizes our results of operations for the nine months ended September 30, 2023 and 2022:

Revenue

Collaboration revenue decreased by $8.8 million to $0.2 million for the nine months ended September 30, 2023, compared to $9.0 million for the nine months ended September 30, 2022 The decrease in revenue was primarily because we had substantially satisfied the majority of the performance obligations related to the 2018 Roche Agreement as of December 31, 2022. Grant revenue decreased by $0.5 million to $0 for the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022. The decrease in grant revenue was because we did not perform any government grant related services during the nine months ended September 30, 2023.

Research and Development Expenses

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Research and development expenses decreased by $19.2 million to $36.2 million for nine months ended September 30, 2023, from $55.4 million for the nine months ended September 30, 2022. The net decrease was primarily due to the following:

The decreases in facilities, laboratory and consumable materials and platform-related external services and other costs were due to cost reductions as a result of the implementation of the 2022 Restructuring Plan.

Partially offsetting the above decreases were:

General and Administrative Expenses

General and administrative expenses decreased by $5.2 million during the nine months ended September 30, 2023 to $15.6 million, compared to $20.8 million for the nine months ended September 30, 2022. The decrease was primarily due to cost and headcount reductions as a result of the implementation of the 2022 Restructuring Plan.

Restructuring Charges

Restructuring charges for the nine months ended September 30, 2023 were $7.7 million, compared to $0 for the nine months ended September 30, 2023. The increase in restructuring charges was primarily due to the following:

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Interest Income

Interest income for the nine months ended September 30, 2023 and 2022 was $1.0 million and $0.6 million, respectively. The increase in interest income was due to the increase in average interest rates in 2023 despite lower average cash and equivalents available for investment.

Other Income (Expense), Net

Other income (expense), net for both the nine months ended September 30, 2023 and 2022 was not significant.

Comparison of the Years Ended December 31, 2022 and 2021

The following table summarizes our results of operations for the years ended December 31, 2022 and 2021: