Company: ABUS
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001447028-25-000083
Chunk: 13

Company: Arbutus Biopharma Corp
Filing Date: 2025-03-27
Form: 10-K
Item: Item 9B
Chunk 13
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 compliance with, the Separation Agreement, the post-termination exercise period of any vested options to purchase our common shares held by Mr. McElhaugh as of the date of his termination will be extended from the current term of such options as set forth in the applicable award agreement (the McElhaugh Current Term) to the earlier of: (i) the McElhaugh Current Term; and (ii) February 23, 2026.

The foregoing description of the Separation Agreement does not purport to be complete and is qualified in its entirety by reference to the Separation Agreement, a copy of which will be filed as an exhibit to our Quarterly Report on Form 10-Q for the three months ending March 31, 2025.

Corporate Restructuring

On March 25, 2025, our Board committed to a course of action to (i) reduce our workforce by 57%, resulting in a total workforce after reductions of 19 employees, (ii) exit our corporate headquarters in Warminster, PA, and (iii) discontinue in-house scientific research. The determination to proceed with these actions was made as a result of our Board’s determination and plan to restructure our organization to optimize overall business performance. 

In connection with these actions, we expect to incur a one-time restructuring charge in the first quarter of 2025 of approximately $11 million to $13 million, consisting of: (i) $5.9 million to $6.3 million of employee severance and benefits cash expenditures; (ii) $1.5 million to $2.2 million of non-cash stock-based compensation expenses for employee equity award modifications; and (iii), in connection with the decision to exit our corporate headquarters, (a) $3.9 million to $4.2 million of non-cash impairment charges for laboratory equipment, leasehold improvements and our right-of-use asset and (b) $0.3 million to $0.4 million of cash lease-related operating expenses. Substantially all of the termination severance payments and other employee benefits costs are expected to be paid during the second quarter of 2025, with the remainder to be paid in the second half of 2025. 

Termination of Open Market Sale Agreement

On March 25, 2025, we provided notice of our termination, effective March 26, 2025, of that certain Open Market Sale Agreement, dated December 20, 2018, as amended (the Sale Agreement