Company: MBIO
Filing Date: 2025-02-07
Form Type: 424B4
Source: 0001410578-25-000085
Chunk: 222

Company: MUSTANG BIO, INC.
Filing Date: 2025-02-07
Form: 424B4
Chunk 222
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 transaction with uBriGene

As discussed in Note 5 to the financial statements, during 2023, the Company entered into an Asset Purchase Agreement and related amendments with uBriGene Biosciences, Inc. (uBriGene), pursuant to which the Company has agreed to sell its leasehold interest in its cell processing facility and associated assets relating to the production of cell and gene therapies to uBriGene. The Company received proceeds of $6.0 million, which it allocated to the individual sold assets on a relative fair value basis. The Company recognized a gain of $1.5 million and recorded $0.2 million of the consideration as deferred income of in its 2023 financial statement. The transaction requires governmental and lessor approval before the lease interest can be transferred to uBriGene. The Company will recognize the deferred income and will receive additional proceeds from uBriGene totaling $5.0 million, if the Company, within two years from the closing date, (i) completes an issuance of equity securities in an amount equal to or greater than $10.0 million and (ii) obtains consent of the landlord to the proposed lease transfer.

We identified the evaluation of the Company’s accounting for the transaction with uBriGene as a critical audit matter. Specifically, challenging and complex auditor judgment and specialized skills and knowledge were required in identifying the elements of the transaction, including those that were delivered in 2023 and those that were yet to be delivered, and evaluating the application of the relevant accounting guidance.

The following are the primary procedures we performed to address this critical audit matter. We inspected the Company’s accounting analysis for the transaction. We compared management’s assessment of the elements of the transaction delivered and those that were yet to be delivered to supporting documentation. We involved professionals with specialized skills and knowledge, who assisted in: inspecting the underlying agreements to understand the relevant terms and conditions and identify the elements of the transaction evaluating whether the Company’s accounting for the transaction is in accordance with the relevant accounting guidance.

/s/ KPMG LLP

We have served as the Company’s auditor since 2021.

Boston, Massachusetts

March 11, 2024, except for the first paragraph in Note 11, as to which the date is February 5, 2025

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MUSTANG BIO, INC. BALANCE SHEETS (in thousands, except for share and per share amounts)

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