MBIO

Business Context and Reporting Period

Company: Mustang Bio, Inc. (MBIO)
Filing Type: Form 8-K (Current Report)
Date of Report: February 7, 2025 (Earliest event reported)
Reporting Period: Immediate event disclosure regarding material agreements effective as of January 31, 2025 and February 7, 2025.

Key Financial Metrics and Transaction Details

This filing does not report standard periodic financial metrics (revenue, profit, cash flow, or margins). It discloses specific transaction values related to a facility exit:

• Asset Sale Proceeds: $1.0 million purchase price for furniture, fixtures, and equipment (FF&E) to be paid by AbbVie Bioresearch Center Inc.
• Estimated Cost Savings: Approximately $2.0 million in lease-related payments and obligations upon early termination.
• Liquidity Impact: Proceeds are held in escrow pending inspection and acceptance conditions.

Material Changes and Agreements

The Company entered into three primary agreements to facilitate the transfer of its leased premises at 377 Plantation Street, Worcester, Massachusetts:

1. Bill of Sale and Surrender Agreement: Effective January 31, 2025, with AbbVie. Mustang Bio sells FF&E for $1.0 million. AbbVie will lease the premises from the landlord following Mustang Bio's vacating.
2. Escrow Agreement: Dated February 10, 2025, with Bowditch & Dewey, LLP. The $1.0 million purchase price is held in escrow until AbbVie confirms the condition of the FF&E or a settlement is reached.
3. First Amendment to Lease Agreement: Dated February 7, 2025, with the landlord. This amends the original lease to allow for early termination and transfer of the lease to AbbVie.

Outlook, Risks, and Contingencies

Conditions Precedent: The release of the $1.0 million purchase price is contingent upon AbbVie's inspection of the FF&E within a 7-business-day period following Mustang Bio's vacating of the premises.

• Acceptance Criteria: At least 90% of furniture items and 90% of all FF&E items must be in "Acceptable Condition" for full payment.
• Price Reduction: If 90% of furniture and 75% of all FF&E are acceptable, the price is reduced proportionally.
• Termination Risk: If less than 90% of furniture or 75% of all FF&E are acceptable and no settlement is reached within the negotiation period, either party may terminate the agreement. In this event, Mustang Bio retains the FF&E, and AbbVie vacates the premises.
• Lease Termination: The estimated $2.0 million savings is contingent on the "Early Termination Date" occurring. If the transfer fails, the original lease terms may remain in effect.

Investor Verification Checklist

• Verify the final status of the FF&E inspection and whether the full $1.0 million was released from escrow.
• Confirm the actual date Mustang Bio vacated the premises and the subsequent "Early Termination Date."
• Monitor future filings for confirmation of the $2.0 million in realized lease savings.
• Review the Company's updated cash position and burn rate following the potential receipt of sale proceeds and reduction in operating expenses.