Company: HCWB
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0000950170-25-046724
Chunk: 117

Company: HCW Biologics Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 8
Chunk 117
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 ended December 31, 2023 and 2024, the Company analyzed its expenses and determined that expenses of $9.8 million and $6.4 million, respectively, fell within the definition of Section 174. Accordingly, these expenditures were capitalized and amortized for tax purposes. As of December 31, 2023 and 2024, the Company had $2.6 million and $3.8 million, respectively, of amortization expense related to Section 174 capitalized R&E costs.The Company’s tax returns remain subject to examination by tax authorities beginning with the tax year ended December 31, 2020. However, due to NOLs and credits carried forward from prior tax years, substantially all tax years may also be subject to examination. The Company recognizes the tax benefit of an uncertain tax position only if it is more likely than not that the position is sustainable upon review by the taxing authorities based on the technical merits. The Company recognizes interest accrued and penalties for unrecognized tax benefits in its tax provision. As of December 31, 2023 and 2024, the Company had not recognized any expense related to uncertain tax position in its statement of operations.

15. Related Party Transactions On February 20, 2024, the Company completed a $2.5 million private placement of shares of common stock with certain of its officers and directors at a price of $1.40 per share.  The Company issued 1,785,718 shares of common stock in connection with the offering.  The shares have not been registered and will not be sold or transferred except as permitted under law and pursuant to registration or exemption therefrom.  The Board of Directors and Audit Committee of the Board of Directors reviewed the transaction under the Company’s policy for Related Party Transactions (the “Policy”) and determined that the transaction was in compliance with the Policy.    As of October 31, 2024, the Company issued an aggregate of $6.9 million of Secured Notes, with $2.9 million from the Company’s officers and members of the board of directors, including $2.4 million purchased by Dr. Hing C. Wong, Founder and CEO, $220,000 purchased by Rebecca Byam, Chief Financial Officer, $140,000 purchased by Scott T. Garrett, Chairman of the board of directors, $60,000 purchased by Gary M. Winer, member of the board of directors, $25,000 purchased by Lee Flowers, Senior Vice President for Business Development