Company: TVRD
Filing Date: 2025-10-07
Form Type: S-1/A
Source: 0001104659-25-097519
Chunk: 156

Company: Tvardi Therapeutics, Inc.
Filing Date: 2025-10-07
Form: S-1/A
Chunk 156
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 of specialty. We intend to continue to consistently apply this process using the same or a similar peer group of public companies, until a sufficient amount of historical information regarding the volatility of our own common stock price becomes available. |

| ● | Expected Term — Derived from the life of the options granted under the option plan and is based on the simplified method which is essentially the weighted average of the vesting period and contractual term. |

| ● | Risk-Free Interest Rate — The risk-free interest rate is based on the implied yield currently available on U.S. Treasury zero-coupon issues with a term that is equal to the options’ expected term at the grant date. |

| ● | Dividend Yield — We have not declared or paid dividends to date and do not anticipate declaring dividends. As such, the dividend yield has been estimated to be zero. |

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Changes in the foregoing assumptions can materially affect the estimate of grant date fair value and ultimately how much share-based compensation expense is recognized; and the resulting change in fair value, if any, is recognized in our statements of operations during the period the related services are rendered. These inputs are subjective and generally require significant analysis and judgment to develop. Fair Value of Legacy Tvardi Stock-Based Awards As a privately held company prior to the Merger, there had been no public market for Legacy Tvardi’s common stock. The estimated fair value of Legacy Tvardi’s common stock had been determined by its board of directors as of the date of each option grant, with input from management, considering the most recently available third-party valuations of its common stock and its board of directors’ assessment of additional objective and subjective factors that it believed were relevant and which may have changed from the date of the most recent valuation through the date of the grant. These third-party valuations were performed in accordance with the guidance outlined in the American Institute of Certified Public Accountants’ Accounting and Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation. Legacy Tvardi’s third-party valuations of common stock were prepared using the option-pricing method (“OPM”), which used a market approach to estimate Legacy Tvardi’s enterprise value. The OPM treats common stock as call options on the total equity value of a company, with exercise prices based on the value thresholds at which the allocation among the various holders of a company’s securities changes. Under this method, the common stock has value only if the funds available for distribution to stockholders exceeded the value of the preferred stock liquid