Correspondence 0001193125-24-207857 from Bicara Therapeutics Inc. (BCAX) (CIK 0002023658) (BCAX)
Bicara Therapeutics Inc. (BCAX) (CIK 0002023658)
Date: Aug. 27, 2024 · CIK: 0002023658 · Accession: 0001193125-24-207857
AI Filing Summary & Sentiment
File numbers found in text: 333-281722
Referenced dates: July 5, 2024
Letter
VIA EDGAR, FACSIMILE AND FEDERAL EXPRESS Division of Corporation Finance Office of Life Sciences Attention: Tara Harkins, Vanessa Robertson, Daniel Crawford and Tim Buchmiller Registration Statement on Form S-1 File No. 333-281722 CIK No. 0002023658 Rule 83 Confidential Treatment Request by Bicara Therapeutics Inc.
Dear Ladies and Gentlemen:
On behalf of Bicara Therapeutics Inc. (the “Company”), in response to comments from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) received by letter dated July 5, 2024 (the “Comment Letter”) relating to the Company’s Registration Statement on Form S-1, originally confidentially submitted to the Commission on June 10, 2024, and subsequently publicly filed by the Company with the Commission on August 22, 2024 (File No. 333-281722) (the “Registration Statement”), we submit this supplemental letter to address comment 12 of the Comment Letter.
FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC.
Division of Corporation Finance
Office of Life Sciences
U.S. Securities and Exchange Commission
August 27, 2024
Page 2
Because of the commercially sensitive nature of information contained herein, this submission is accompanied by the Company’s request for confidential treatment for selected portions of this letter. The Company has concurrently filed a separate letter with the Office of Freedom of Information and Privacy Act Operations in connection with the confidential treatment request, pursuant to Rule 83 of the Commission’s Rules on Information and Requests, 17 C.F.R. § 200.83. For the Staff’s reference, we have enclosed a copy of the Company’s letter to the Office of Freedom of Information and Privacy Act Operations.
We confirm on behalf of the Company that, prior to circulating copies of the preliminary prospectus in connection with the offering, the Company will file a pre-effective amendment to the Registration Statement that will include all information other than information that may be excluded in reliance upon Rule 430A of Regulation C, and the final price range to be included in such amendment which will comply with the Staff’s interpretation regarding the parameters of a bona fide price range.
Prior to the effectiveness of the Registration Statement, the Company intends to implement a reverse stock split of its Common Stock (the “Stock Split”). The Company expects to reflect the Stock Split in a pre-effective amendment to the Registration Statement that includes the actual price range. For purposes of this letter, we have presented all dollar and per share amounts without giving effect to the Stock Split to be consistent with the current presentation in the Registration Statement.
The Company respectfully requests that the bracketed information contained in this letter be treated as confidential information pursuant to Rule 83 promulgated by the Commission, 17 C.F.R. §200.8, and that the Commission provide timely notice to Claire Mazumdar before it permits any disclosure of the bracketed information in this letter.
For the convenience of the Staff, we have recited the prior comment from the Staff in the Comment Letter in italicized type and have followed the comment with the Company’s response.
12. Once you have an estimated offering price or range, please explain to us how you determined the fair value of the common stock underlying your equity issuances and the reasons for any differences between the recent valuations of your common stock lead in up to the initial public offering and the estimated offering price. This information will help facilitate our review of your accounting for equity issuances including stock compensation. Please discuss with the staff how to submit your response.
The Company respectfully submits the below additional information to assist the Staff in its review of the Company’s position with respect to its determination of the fair value of the Company’s common stock, par value $0.0001 per share (“Common Stock”), underlying its outstanding equity awards and the reasons for the differences between the recent valuation of its Common Stock and the estimated offering price for its initial public offering (“IPO”).
FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC.
Division of Corporation Finance
Office of Life Sciences
U.S. Securities and Exchange Commission
August 27, 2024
Page 3
Preliminary IPO Price Range
The Company advises the Staff that it estimates a preliminary price range of approximately $[***] to $[***] per share (the “Preliminary Price Range”) for its IPO, before giving effect to the Stock Split, resulting in a midpoint of the Preliminary Price Range of $[***] per share. The actual price range to be included in a subsequent amendment to the Registration Statement (which will comply with the Staff’s interpretation regarding the parameters of a bona fide price range) has not yet been determined and remains subject to adjustment based on factors outside of the Company’s control. However, the Company believes that the foregoing Preliminary Price Range will not be subject to significant change.
Determining the Fair Value of Common Stock Prior to the IPO
As there has been no public market for the Common Stock to date, the estimated fair value of its Common Stock has been determined by the Company’s board of directors (the “Board”) as of the date of each equity award, with input from management, considering the Company’s most recently available third-party valuations of its Common Stock, and the Board’s 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.
The Company’s most recent third-party valuations of its Common Stock utilized by the Board in determining exercise prices at the time of each equity award were as follows:
Date of Third-Party
Valuation
Date of Board
Approval
Estimated Fair Market
Value of Common Stock
per Share
September 30, 2022
October 4, 2022
$0.48
March 31, 2023
April 5, 2023
$0.41
November 20, 2023
December 14, 2023
$0.59
June 1, 2024
N/A
$0.90
June 28, 2024
August 6, 2024
$1.00
FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC.
Division of Corporation Finance
Office of Life Sciences
U.S. Securities and Exchange Commission
August 27, 2024
Page 4
Equity Awards Between January 1, 2023 and August 19, 2024
The following table summarizes by grant date the number of shares subject to awards granted between January 1, 2023 and August 19, 2024, the per share exercise price of the awards and the fair value of Common Stock underlying the awards on each grant date:
Grant Date
Type of Award
Number of Shares Subject to Award
Per Share Exercise Price of Award
Per Share Fair Market Value of Common Stock on Grant Date
Per Share Estimated Fair Value of Award on Grant Date(1)
1/01/2023
Option
100,000
$0.48
$0.48
$0.35
04/05/2023
Option
4,845,000
$0.41
$0.41
$0.30
08/08/2023
Option
13,472,075
$0.41
$0.41
$0.30
09/22/2023
Option
2,000,000
$0.41
$0.41
$0.30
12/14/2023
Option
18,278,630
$0.59
$0.59
$0.43
03/26/2024
Option
1,950,000
$0.59
$0.59
$0.44
04/23/2024
Option
250,000
$0.59
$0.59
$0.44
08/13/2024
Option
29,250,000
$1.00
$1.00
$0.77
08/19/2024
Option
700,000
$1.00
$1.00
$0.77
(1) The per share estimated fair value of options reflects the fair value of options granted on each grant date determined using the Black-Scholes option-pricing model.
Valuation Methodologies
The 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 (“Practice Aid”). As disclosed in the Registration Statement, the Company’s enterprise value valuations were prepared using either an option pricing method (“OPM”) market-adjusted backsolve approach based on a recent arms-length transaction, or the probability-weighted expected return method (“PWERM”), with an IPO scenario and continued operation as a private company scenario.
The OPM treats common stock and preferred 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 liquidation preferences at the time of the liquidity event, such as a strategic sale or a merger.
FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC.
Division of Corporation Finance
Office of Life Sciences
U.S. Securities and Exchange Commission
August 27, 2024
Page 5
The PWERM is a scenario-based methodology that estimates the fair value of common stock based upon an analysis of future values for the company, assuming various outcomes. The common stock value is based on the probability-weighted present value of expected future investment returns considering each of the possible outcomes available as well as the rights of each class of stock. The future value of the common stock under each outcome is discounted back to the valuation date at an appropriate risk-adjusted discount rate and probability weighted to arrive at an indication of value for the common stock. A discount for lack of marketability (“DLOM”) of the common stock is then applied to arrive at an indication of value for the common stock.
September 30, 2022 Valuation
The fair value of the Common Stock of $0.48 per share at September 30, 2022 was determined with the assistance of an independent third-party valuation firm and approved by the Board on October 4, 2022. This valuation was used to support the fair market value of the Common Stock in accordance with Section 409A of the IRC with respect to options granted on January 1, 2023, along with other factors determined by the Board to be relevant at the time of the grant of such options.
The September 30, 2022 valuation applied the OPM method to allocate the fair value of the Company’s equity to various securities within the Company’s capital structure. Under this method, the OPM model was built based on the Company’s capital structure and reasonable option model inputs. The equity value of the Company was determined such that the implied value per share of Series Seed preferred stock was equal to its original issue price to third party investors at the closing of the Series Seed preferred stock financing on September 2, 2022. The 35.0% DLOM applied to the fair value of Common Stock was estimated using a put option analysis.
Between September 30, 2022 and January 1, 2023, the Company continued to operate its business in the ordinary course and there were no significant developments in its business. As a result, the Company determined that the fair value of the Company’s Common Stock remained $0.48 per share from September 30, 2022 and January 1, 2023.
The principal factors contributing to the decrease in the fair value of Common Stock from the September 30, 2022 valuation to the March 15, 2023 valuation, include the following:
•
The Company continued to operate its business in the ordinary course and there were no significant developments in its business.
•
The closing of the Series B preferred stock financing at a purchase price of $1.025 per share. Given the proximity of the closing of the Series B preferred stock financing on March 2, 2023, the valuation firm considered the OPM back-solve approach to estimate the implied total equity value of the Company. Under this method, an OPM allocation model was built based on the Company’s capital structure and reasonable option model inputs.
•
The departure of Liviu Niculescu, Chief Medical Officer on November 4, 2022.
FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC.
Division of Corporation Finance
Office of Life Sciences
U.S. Securities and Exchange Commission
August 27, 2024
Page 6
•
Macroeconomic volatility when Silicon Valley Bank, where the Company kept its operating cash, failed on March 10, 2023 after a bank run.
March 15, 2023 Valuation
The fair value of the Common Stock of $0.41 per share at March 15, 2023 was determined with the assistance of an independent third-party valuation firm and approved by the Board on April 5, 2023. This valuation was used to support the fair market value of the Common Stock in accordance with Section 409A of the IRC with respect to options granted on April 5, 2023 through September 22, 2023, along with other factors determined by the Board to be relevant at the time of each such grant of options.
The March 15, 2023 valuation applied the OPM method to allocate the fair value of the Company’s equity to various securities within the Company’s capital structure. Under this method, the OPM model was built based on the Company’s capital structure and reasonable option model inputs. The equity value of the Company was determined such that the implied value per share of Series B preferred stock was equal to its original price issued to third party investors at the closing of the Series B preferred stock financing on March 2, 2023 The 35.0% DLOM applied to the fair value of Common Stock was estimated using a put option analysis.
Between March 15, 2023 and September 22, 2023, the Company continued to operate its business in the ordinary course and there were no significant developments in its business. As a result, the Company determined that the fair value of the Company’s Common Stock remained $0.41 per share from March 15, 2023 to September 22, 2023.
November 20, 2023 Valuation
The fair value of the Common Stock of $0.59 per share at November 20, 2023 was determined with the assistance of an independent third-party valuation firm and approved by the Board on December 14, 2023. This valuation was used to support the fair market value of the Common Stock in accordance with Section 409A of the IRC with respect to options granted on December 14, 2023, March 26, 2024 and April 23, 2024, along with other factors determined by the Board to be relevant at the time of such grant of options.
The December 14, 2023 valuation applied the OPM method to allocate the fair value of the Company’s equity to various securities within the Company’s capital structure. Under this method, the OPM model was built based on the Company’s capital structure and reasonable option model inputs. The equity value of the Company was determined such that the implied value per share of Series C preferred stock was equal to its original price issued to third party investors at the closing of the Series C preferred stock financing on December 5, 2023. The 32.5% DLOM applied to the fair value of Common Stock was estimated using a put option analysis.
FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC.
Division of Corporation Finance
Office of Life Science
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CORRESP 1 filename1.htm CORRESP Goodwin Procter 100 Northern Avenue Boston, MA 02210 goodwinlaw.com +1 617 570 1000 August 27, 2024 FOIA CONFIDENTIAL TREATMENT REQUESTED The entity requesting confidential treatment is Bicara Therapeutics Inc. 116 Huntington Avenue, Suite 703 Boston, MA 02116 Telephone: (617) 468-4219 CERTAIN PORTIONS OF THIS LETTER HAVE BEEN OMITTED FROM THE VERSION FILED VIA EDGAR. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. INFORMATION THAT WAS OMITTED IN THE EDGAR VERSION HAS BEEN NOTED IN THIS LETTER WITH A PLACEHOLDER IDENTIFIED BY THE MARK “[***].” VIA EDGAR, FACSIMILE AND FEDERAL EXPRESS U.S. Securities and Exchange Commission Division of Corporation Finance Office of Life Sciences 100 F Street, N.E. Washington, D.C. 20549 Attention: Tara Harkins, Vanessa Robertson, Daniel Crawford and Tim Buchmiller RE: Bicara Therapeutics Inc. Registration Statement on Form S-1 File No. 333-281722 CIK No. 0002023658 Rule 83 Confidential Treatment Request by Bicara Therapeutics Inc. Dear Ladies and Gentlemen: On behalf of Bicara Therapeutics Inc. (the “Company”), in response to comments from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) received by letter dated July 5, 2024 (the “Comment Letter”) relating to the Company’s Registration Statement on Form S-1, originally confidentially submitted to the Commission on June 10, 2024, and subsequently publicly filed by the Company with the Commission on August 22, 2024 (File No. 333-281722) (the “Registration Statement”), we submit this supplemental letter to address comment 12 of the Comment Letter. FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC. Division of Corporation Finance Office of Life Sciences U.S. Securities and Exchange Commission August 27, 2024 Page 2 Because of the commercially sensitive nature of information contained herein, this submission is accompanied by the Company’s request for confidential treatment for selected portions of this letter. The Company has concurrently filed a separate letter with the Office of Freedom of Information and Privacy Act Operations in connection with the confidential treatment request, pursuant to Rule 83 of the Commission’s Rules on Information and Requests, 17 C.F.R. § 200.83. For the Staff’s reference, we have enclosed a copy of the Company’s letter to the Office of Freedom of Information and Privacy Act Operations. We confirm on behalf of the Company that, prior to circulating copies of the preliminary prospectus in connection with the offering, the Company will file a pre-effective amendment to the Registration Statement that will include all information other than information that may be excluded in reliance upon Rule 430A of Regulation C, and the final price range to be included in such amendment which will comply with the Staff’s interpretation regarding the parameters of a bona fide price range. Prior to the effectiveness of the Registration Statement, the Company intends to implement a reverse stock split of its Common Stock (the “Stock Split”). The Company expects to reflect the Stock Split in a pre-effective amendment to the Registration Statement that includes the actual price range. For purposes of this letter, we have presented all dollar and per share amounts without giving effect to the Stock Split to be consistent with the current presentation in the Registration Statement. The Company respectfully requests that the bracketed information contained in this letter be treated as confidential information pursuant to Rule 83 promulgated by the Commission, 17 C.F.R. §200.8, and that the Commission provide timely notice to Claire Mazumdar before it permits any disclosure of the bracketed information in this letter. For the convenience of the Staff, we have recited the prior comment from the Staff in the Comment Letter in italicized type and have followed the comment with the Company’s response. 12. Once you have an estimated offering price or range, please explain to us how you determined the fair value of the common stock underlying your equity issuances and the reasons for any differences between the recent valuations of your common stock lead in up to the initial public offering and the estimated offering price. This information will help facilitate our review of your accounting for equity issuances including stock compensation. Please discuss with the staff how to submit your response. The Company respectfully submits the below additional information to assist the Staff in its review of the Company’s position with respect to its determination of the fair value of the Company’s common stock, par value $0.0001 per share (“Common Stock”), underlying its outstanding equity awards and the reasons for the differences between the recent valuation of its Common Stock and the estimated offering price for its initial public offering (“IPO”). 2 FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC. Division of Corporation Finance Office of Life Sciences U.S. Securities and Exchange Commission August 27, 2024 Page 3 Preliminary IPO Price Range The Company advises the Staff that it estimates a preliminary price range of approximately $[***] to $[***] per share (the “Preliminary Price Range”) for its IPO, before giving effect to the Stock Split, resulting in a midpoint of the Preliminary Price Range of $[***] per share. The actual price range to be included in a subsequent amendment to the Registration Statement (which will comply with the Staff’s interpretation regarding the parameters of a bona fide price range) has not yet been determined and remains subject to adjustment based on factors outside of the Company’s control. However, the Company believes that the foregoing Preliminary Price Range will not be subject to significant change. Determining the Fair Value of Common Stock Prior to the IPO As there has been no public market for the Common Stock to date, the estimated fair value of its Common Stock has been determined by the Company’s board of directors (the “Board”) as of the date of each equity award, with input from management, considering the Company’s most recently available third-party valuations of its Common Stock, and the Board’s 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. The Company’s most recent third-party valuations of its Common Stock utilized by the Board in determining exercise prices at the time of each equity award were as follows: Date of Third-Party Valuation Date of Board Approval Estimated Fair Market Value of Common Stock per Share September 30, 2022 October 4, 2022 $0.48 March 31, 2023 April 5, 2023 $0.41 November 20, 2023 December 14, 2023 $0.59 June 1, 2024 N/A $0.90 June 28, 2024 August 6, 2024 $1.00 3 FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC. Division of Corporation Finance Office of Life Sciences U.S. Securities and Exchange Commission August 27, 2024 Page 4 Equity Awards Between January 1, 2023 and August 19, 2024 The following table summarizes by grant date the number of shares subject to awards granted between January 1, 2023 and August 19, 2024, the per share exercise price of the awards and the fair value of Common Stock underlying the awards on each grant date: Grant Date Type of Award Number of Shares Subject to Award Per Share Exercise Price of Award Per Share Fair Market Value of Common Stock on Grant Date Per Share Estimated Fair Value of Award on Grant Date(1) 1/01/2023 Option 100,000 $0.48 $0.48 $0.35 04/05/2023 Option 4,845,000 $0.41 $0.41 $0.30 08/08/2023 Option 13,472,075 $0.41 $0.41 $0.30 09/22/2023 Option 2,000,000 $0.41 $0.41 $0.30 12/14/2023 Option 18,278,630 $0.59 $0.59 $0.43 03/26/2024 Option 1,950,000 $0.59 $0.59 $0.44 04/23/2024 Option 250,000 $0.59 $0.59 $0.44 08/13/2024 Option 29,250,000 $1.00 $1.00 $0.77 08/19/2024 Option 700,000 $1.00 $1.00 $0.77 (1) The per share estimated fair value of options reflects the fair value of options granted on each grant date determined using the Black-Scholes option-pricing model. Valuation Methodologies The 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 (“Practice Aid”). As disclosed in the Registration Statement, the Company’s enterprise value valuations were prepared using either an option pricing method (“OPM”) market-adjusted backsolve approach based on a recent arms-length transaction, or the probability-weighted expected return method (“PWERM”), with an IPO scenario and continued operation as a private company scenario. The OPM treats common stock and preferred 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 liquidation preferences at the time of the liquidity event, such as a strategic sale or a merger. 4 FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC. Division of Corporation Finance Office of Life Sciences U.S. Securities and Exchange Commission August 27, 2024 Page 5 The PWERM is a scenario-based methodology that estimates the fair value of common stock based upon an analysis of future values for the company, assuming various outcomes. The common stock value is based on the probability-weighted present value of expected future investment returns considering each of the possible outcomes available as well as the rights of each class of stock. The future value of the common stock under each outcome is discounted back to the valuation date at an appropriate risk-adjusted discount rate and probability weighted to arrive at an indication of value for the common stock. A discount for lack of marketability (“DLOM”) of the common stock is then applied to arrive at an indication of value for the common stock. September 30, 2022 Valuation The fair value of the Common Stock of $0.48 per share at September 30, 2022 was determined with the assistance of an independent third-party valuation firm and approved by the Board on October 4, 2022. This valuation was used to support the fair market value of the Common Stock in accordance with Section 409A of the IRC with respect to options granted on January 1, 2023, along with other factors determined by the Board to be relevant at the time of the grant of such options. The September 30, 2022 valuation applied the OPM method to allocate the fair value of the Company’s equity to various securities within the Company’s capital structure. Under this method, the OPM model was built based on the Company’s capital structure and reasonable option model inputs. The equity value of the Company was determined such that the implied value per share of Series Seed preferred stock was equal to its original issue price to third party investors at the closing of the Series Seed preferred stock financing on September 2, 2022. The 35.0% DLOM applied to the fair value of Common Stock was estimated using a put option analysis. Between September 30, 2022 and January 1, 2023, the Company continued to operate its business in the ordinary course and there were no significant developments in its business. As a result, the Company determined that the fair value of the Company’s Common Stock remained $0.48 per share from September 30, 2022 and January 1, 2023. The principal factors contributing to the decrease in the fair value of Common Stock from the September 30, 2022 valuation to the March 15, 2023 valuation, include the following: • The Company continued to operate its business in the ordinary course and there were no significant developments in its business. • The closing of the Series B preferred stock financing at a purchase price of $1.025 per share. Given the proximity of the closing of the Series B preferred stock financing on March 2, 2023, the valuation firm considered the OPM back-solve approach to estimate the implied total equity value of the Company. Under this method, an OPM allocation model was built based on the Company’s capital structure and reasonable option model inputs. • The departure of Liviu Niculescu, Chief Medical Officer on November 4, 2022. 5 FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC. Division of Corporation Finance Office of Life Sciences U.S. Securities and Exchange Commission August 27, 2024 Page 6 • Macroeconomic volatility when Silicon Valley Bank, where the Company kept its operating cash, failed on March 10, 2023 after a bank run. March 15, 2023 Valuation The fair value of the Common Stock of $0.41 per share at March 15, 2023 was determined with the assistance of an independent third-party valuation firm and approved by the Board on April 5, 2023. This valuation was used to support the fair market value of the Common Stock in accordance with Section 409A of the IRC with respect to options granted on April 5, 2023 through September 22, 2023, along with other factors determined by the Board to be relevant at the time of each such grant of options. The March 15, 2023 valuation applied the OPM method to allocate the fair value of the Company’s equity to various securities within the Company’s capital structure. Under this method, the OPM model was built based on the Company’s capital structure and reasonable option model inputs. The equity value of the Company was determined such that the implied value per share of Series B preferred stock was equal to its original price issued to third party investors at the closing of the Series B preferred stock financing on March 2, 2023 The 35.0% DLOM applied to the fair value of Common Stock was estimated using a put option analysis. Between March 15, 2023 and September 22, 2023, the Company continued to operate its business in the ordinary course and there were no significant developments in its business. As a result, the Company determined that the fair value of the Company’s Common Stock remained $0.41 per share from March 15, 2023 to September 22, 2023. November 20, 2023 Valuation The fair value of the Common Stock of $0.59 per share at November 20, 2023 was determined with the assistance of an independent third-party valuation firm and approved by the Board on December 14, 2023. This valuation was used to support the fair market value of the Common Stock in accordance with Section 409A of the IRC with respect to options granted on December 14, 2023, March 26, 2024 and April 23, 2024, along with other factors determined by the Board to be relevant at the time of such grant of options. The December 14, 2023 valuation applied the OPM method to allocate the fair value of the Company’s equity to various securities within the Company’s capital structure. Under this method, the OPM model was built based on the Company’s capital structure and reasonable option model inputs. The equity value of the Company was determined such that the implied value per share of Series C preferred stock was equal to its original price issued to third party investors at the closing of the Series C preferred stock financing on December 5, 2023. The 32.5% DLOM applied to the fair value of Common Stock was estimated using a put option analysis. 6 FOIA CONFIDENTIAL TREATMENT REQUESTED BY BICARA THERAPEUTICS INC. Division of Corporation Finance Office of Life Science