<SEC-DOCUMENT>0001193125-19-096634.txt : 20190403
<SEC-HEADER>0001193125-19-096634.hdr.sgml : 20190403
<ACCEPTANCE-DATETIME>20190403160802
ACCESSION NUMBER:		0001193125-19-096634
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20190403
ITEM INFORMATION:		Other Events
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20190403
DATE AS OF CHANGE:		20190403

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			SANGAMO THERAPEUTICS, INC
		CENTRAL INDEX KEY:			0001001233
		STANDARD INDUSTRIAL CLASSIFICATION:	BIOLOGICAL PRODUCTS (NO DIAGNOSTIC SUBSTANCES) [2836]
		IRS NUMBER:				680359556
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-30171
		FILM NUMBER:		19729036

	BUSINESS ADDRESS:	
		STREET 1:		501 CANAL BLVD
		STREET 2:		POINT RICHMOND TECH CNTR.
		CITY:			RICHMOND
		STATE:			CA
		ZIP:			94804
		BUSINESS PHONE:		5109706000

	MAIL ADDRESS:	
		STREET 1:		501 CANAL BLVD
		STREET 2:		POINT RICHMOND TECH CNTR.
		CITY:			RICHMOND
		STATE:			CA
		ZIP:			94804

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	SANGAMO BIOSCIENCES INC
		DATE OF NAME CHANGE:	20000208
</SEC-HEADER>
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<TYPE>8-K
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<FILENAME>d724721d8k.htm
<DESCRIPTION>8-K
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<Center><DIV STYLE="width:8.5in" align="left">
 <P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P>
<P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="margin-top:4pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>UNITED STATES </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>SECURITIES AND EXCHANGE COMMISSION </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>WASHINGTON, DC 20549 </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>FORM <FONT
STYLE="white-space:nowrap">8-K</FONT> </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>CURRENT
REPORT </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Pursuant to Section&nbsp;13 or 15(d) </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>of the Securities Exchange Act of 1934 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Date of Report (Date of earliest event reported): April&nbsp;3, 2019 </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:24pt; font-family:Times New Roman" ALIGN="center"><B>SANGAMO THERAPEUTICS, INC. </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>(Exact Name of Registrant as Specified in its Charter) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top" ALIGN="center"><B>Delaware</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B><FONT STYLE="white-space:nowrap">000-30171</FONT></B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B><FONT STYLE="white-space:nowrap">68-0359556</FONT></B></TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:8pt">
<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(State or Other Jurisdiction</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>of Incorporation)</B></P></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Commission</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>File Number)</B></P></TD>
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<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(IRS Employer</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Identification No.)</B></P></TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>501 Canal Blvd., Richmond, California 94804 </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Address of Principal Executive Offices) (Zip Code) </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>(510) <FONT STYLE="white-space:nowrap">970-6000</FONT> </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Registrant&#146;s telephone number, including area code) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Former Name or Former Address, if Changed Since Last Report) </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Check the appropriate box below if the Form <FONT STYLE="white-space:nowrap">8-K</FONT> filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (<I>see</I> General Instruction A.2. below): </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) </P></TD></TR></TABLE>
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<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Soliciting material pursuant to Rule <FONT STYLE="white-space:nowrap">14a-12</FONT> under the Exchange Act (17
CFR <FONT STYLE="white-space:nowrap">240.14a-12)</FONT> </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left">&#9744;</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><FONT STYLE="white-space:nowrap">Pre-commencement</FONT> communications pursuant to Rule <FONT
STYLE="white-space:nowrap">14d-2(b)</FONT> under the Exchange Act (17 CFR <FONT STYLE="white-space:nowrap">240.14d-2(b))</FONT> </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><FONT STYLE="white-space:nowrap">Pre-commencement</FONT> communications pursuant to Rule <FONT
STYLE="white-space:nowrap">13e-4(c)</FONT> under the Exchange Act (17 CFR <FONT STYLE="white-space:nowrap">240.13e-4(c))</FONT> </P></TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (&#167; 230.405 of this
chapter) or Rule <FONT STYLE="white-space:nowrap">12b-2</FONT> of the Securities Exchange Act of 1934 (&#167; <FONT STYLE="white-space:nowrap">240.12b-2</FONT> of this chapter). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Emerging growth company&nbsp;&nbsp;&#9744; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">If an emerging
growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section&nbsp;13(a) of the Exchange
Act.&nbsp;&nbsp;&#9744; </P> <P STYLE="font-size:10pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P> <P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>In this Current Report on Form <FONT STYLE="white-space:nowrap">8-K,</FONT> &#147;Sangamo,&#148;
&#147;the Company,&#148; &#147;we,&#148; &#147;us,&#148; and &#147;our&#148; refer to Sangamo Therapeutics, Inc. and its consolidated subsidiaries. </B></P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Item&nbsp;8.01 Other Events. </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Business Update </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Sangamo is filing information for the purpose of supplementing and updating certain aspects of the description of its business from that
described under the heading, &#147;Item 1. Business&#148; in Sangamo&#146;s Annual Report on <FONT STYLE="white-space:nowrap">Form&nbsp;10-K&nbsp;for</FONT> the year ended December&nbsp;31, 2018, filed with the U.S. Securities and Exchange
Commission, or SEC, on March&nbsp;1, 2019. The updated disclosure is set forth below: </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Recent Developments </I></B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I>Clinical Updates </I></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman"><B><FONT
STYLE="white-space:nowrap">SB-525</FONT> Gene Therapy for the Treatment of Hemophilia A </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are conducting the Phase 1/2 Alta study, an
open-label, ascending-dose clinical trial to evaluate investigational <FONT STYLE="white-space:nowrap">SB-525</FONT> gene therapy for severe hemophilia A, under global collaboration with Pfizer Inc., or Pfizer. In April 2019, we and Pfizer announced
interim data that indicate that <FONT STYLE="white-space:nowrap">SB-525</FONT> was generally well-tolerated and demonstrated a dose-dependent increase in Factor VIII, or FVIII, levels across the four dosage cohorts. Based on these interim results,
the Safety Monitoring Committee, or SMC, recommended cohort expansion at the 3e13 vg/kg dose. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The Phase 1/2 interim data include eight
patients treated across four ascending dosage cohorts, with two patients per cohort. Patients demonstrated a dose-dependent increase in FVIII levels, achieving clinically relevant increases in FVIII activity in the higher dosage cohorts and normal
FVIII levels in the highest 3e13 vg/kg dose cohort (normal range: <FONT STYLE="white-space:nowrap">50-150%).</FONT> At week six post infusion, the two cohort patients dosed at the 3e13 vg/kg level reached 140% and 94% of normal (as measured by <FONT
STYLE="white-space:nowrap">one-stage</FONT> clotting assay) and 93% and 65% (as measured by chromogenic assay). A dose-dependent reduction in the use of FVIII replacement therapy was also observed, with patients in the highest dose cohort not
requiring factor replacement therapy after initial use of prophylactic factor and experiencing no bleeding events to date. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">No
treatment-related serious adverse events and no alanine transaminase, or ALT, elevations requiring more than seven days of corticosteroid treatment were observed in the first three cohorts. Patients in the Alta study were not treated with
prophylactic steroids. One patient in the fourth cohort experienced an ALT elevation (&gt;1.5x upper limit of normal) at week four that required a tapering course of oral steroids. The patient did not have any associated loss of FVIII activity or
ALT elevations seven weeks following initiation of the steroid therapy (five weeks post vector infusion). The same patient in the fourth cohort experienced a treatment-related infusion reaction, classified as a serious adverse event, and was
discharged the following day according to the protocol-specified timeline. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We expect to present longer-term <FONT
STYLE="white-space:nowrap">follow-up</FONT> data at an upcoming scientific meeting. Per the SMC recommendation and study protocol, we are in the process of expanding the fourth cohort by up to five patients and patient enrollment is underway. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman"><B><FONT STYLE="white-space:nowrap">ST-400</FONT> ex vivo Gene-Edited Cell Therapy for Beta
Thalassemia </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are conducting the Phase 1/2 THALES study, an open-label, single arm clinical trial to evaluate the safety and efficacy
of <FONT STYLE="white-space:nowrap">ST-400</FONT> in up to six subjects with beta thalassemia. <FONT STYLE="white-space:nowrap">ST-400</FONT> is an <I>ex vivo </I>gene-edited beta thalassemia cell therapy developed in partnership with Sanofi, that
involves gene editing of a patient&#146;s own hematopoietic stem progenitor cells using <FONT STYLE="white-space:nowrap">non-viral</FONT> delivery of ZFN technology. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In April 2019, we announced early preliminary data from the first patient treated with <FONT STYLE="white-space:nowrap">ST-400</FONT> in the
THALES study. This patient has the most severe form of transfusion-dependent beta thalassemia (<FONT STYLE="FONT-FAMILY:SYMBOL">&#098;</FONT><SUP STYLE="font-size:85%; vertical-align:top">0</SUP>/<FONT STYLE="FONT-FAMILY:SYMBOL">&#098;</FONT><SUP
STYLE="font-size:85%; vertical-align:top">0</SUP>) and for the two years prior to treatment in the study, received packed red blood cell, or PRBC, transfusions every other week. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">During the <FONT STYLE="white-space:nowrap">ST-400</FONT> infusion, the patient experienced a serious adverse event, a transient allergic
reaction considered related to the cryoprotectant present in the product. Thereafter, the post-transplant clinical course was routine. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The patient demonstrated neutrophil and platelet recovery, within two and four weeks of infusion, respectively, indicating that <FONT
STYLE="white-space:nowrap">ST-400</FONT> successfully reconstituted hematopoiesis following conditioning. Indels (small insertions or deletions generated at the targeted DNA sequence) have been detected in circulating white blood cells, indicating
successful editing of the <I>BCL11A</I> gene and disruption of the <I>BCL11A</I> erythroid specific enhancer, which is intended to upregulate endogenous fetal hemoglobin production in red blood cells. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">At seven weeks post <FONT STYLE="white-space:nowrap">ST-400</FONT> infusion, total hemoglobin levels remained stable (~9 g/dL), and levels of
fetal hemoglobin have continued to rise from approximately 1% of total hemoglobin at the time of infusion to 31% as of the most recent measurement. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The patient received several PRBC transfusions for approximately two weeks after the <FONT STYLE="white-space:nowrap">ST-400</FONT> infusion.
During the subsequent five weeks, the most recent data available, no further PRBC transfusions have been required. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We caution that these
data regarding <FONT STYLE="white-space:nowrap">ST-400</FONT> are very early, represent only the first patient dosed, and will require confirmation in additional patients as well as longer <FONT STYLE="white-space:nowrap">follow-up</FONT> to draw
any clinical conclusion. In addition, these very early data should not be viewed as an indication, belief or guarantee that future dosed patients in the THALES study will achieve similar results or that the early results from the first patient dosed
will be maintained. For more information about the risks of early clinical data, including the risk that the very early data from the first patient dosed in the THALES study to date may not be maintained or replicated in that patient or in any other
dosed patients, see the risk factor entitled &#147;<I>Success in preclinical studies or early clinical trials may not be indicative of results obtained in later trials. Likewise, preliminary data from clinical trials should be considered carefully
and with caution since the final data may be materially different from the preliminary data, particularly as more patient data become available</I>&#148; found in Part I, Item 1A of our Annual Report on Form
<FONT STYLE="white-space:nowrap">10-K</FONT> for the year ended December&nbsp;31, 2018, filed with the SEC on March&nbsp;1, 2019. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Enrollment in the THALES study is ongoing. We expect to present longer-term <FONT STYLE="white-space:nowrap">ST-400</FONT> data in the fourth
quarter of 2019, including results from additional patients. Until that time, we are not planning to report additional clinical data from the program. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman"><B>In vivo Genome Editing Programs </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In April 2019, we provided an update on our <I>in vivo</I> genome editing programs: the ongoing Phase 1/2 clinical trials evaluating <FONT
STYLE="white-space:nowrap">SB-913</FONT> (mucopolysaccharidosis type II, or MPS II), <FONT STYLE="white-space:nowrap">SB-318</FONT> (MPS I), and <FONT STYLE="white-space:nowrap">SB-FIX</FONT> (hemophilia B). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We announced that data will continue to accumulate throughout 2019, including in the recently treated expansion cohort patients in the
CHAMPIONS study <FONT STYLE="white-space:nowrap">(SB-913),</FONT> and further updates on all three studies are expected later this year. We expect that no additional patients will be treated at this time with first-generation ZFNs given that
clinical benefit has not been demonstrated in analyses conducted to date in ongoing clinical trials and the expected near-term clinical development of second-generation ZFNs. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are planning a new clinical trial to evaluate second-generation ZFNs for <FONT STYLE="white-space:nowrap">SB-913</FONT> to treat MPS II.
<I>In vitro</I> preclinical data presented last year showed three potential advantages of second-generation ZFNs for use in the clinic: (1)&nbsp;improvements in efficiency and potency due to structural modifications to the ZFN architecture and
expression vector; (2)&nbsp;the ability to function equally well in the patients with a single nucleotide polymorphism, or SNP, in the target locus in the albumin gene (~20% of the population); and (3)&nbsp;improvements in specificity. The clinical
trial of <FONT STYLE="white-space:nowrap">SB-913</FONT> using second-generation ZFNs is planned to begin in the second half of 2019. We expect to use data from this study to make a Phase III decision for the
<FONT STYLE="white-space:nowrap">SB-913</FONT> program in 2020 and to define the next steps for the <FONT STYLE="white-space:nowrap">SB-318</FONT> and <FONT STYLE="white-space:nowrap">SB-FIX</FONT> programs. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman"><B>Zinc Finger Protein Transcription Factor for Treatment of Tauopathies </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In March 2019, we presented new preclinical data describing the effects of <FONT STYLE="white-space:nowrap">tau-targeted</FONT> <FONT
STYLE="white-space:nowrap">ZFP-TFs,</FONT> delivered with adeno-associated viruses, or AAVs, in the mouse and nonhuman primate, or NHP, brain. The data demonstrate significant (&gt;80%) reduction of tau expression in the NHP brain following
administration of <FONT STYLE="white-space:nowrap">ZFP-TFs.</FONT> </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our <FONT STYLE="white-space:nowrap">ZFP-TF</FONT> technology acts at
the DNA level to selectively repress or activate the expression of specific genes to achieve a desired therapeutic effect. Gene regulation differs from other genome editing approaches as it is designed to enable precise, robust, and long-term
repression of a selected gene following a single administration of AAV and does not cut or modify the target DNA. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Tau pathology is
strongly linked to the progression of several neurodegenerative diseases, called tauopathies, including Alzheimer&#146;s disease. Tauopathies are characterized by the accumulation of toxic tau protein in the brain that leads to widespread neuronal
dysfunction and loss. Reducing the total amount of tau expressed within neurons has been shown to provide benefit in animal models of tauopathies. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The new preclinical data demonstrate that <FONT STYLE="white-space:nowrap">ZFP-TFs</FONT> selectively reduced mouse and human tau by up to 98%
<I>in vitro</I> in both primary mouse and induced pluripotent stem cell-derived human neurons. Intrahippocampal <FONT STYLE="white-space:nowrap">ZFP-TF</FONT> delivery to adult mice resulted in more than 80% tau reduction, and intravenous <FONT
STYLE="white-space:nowrap">ZFP-TF</FONT> administration reduced tau levels by <FONT STYLE="white-space:nowrap">50-70%</FONT> across the entire mouse brain. <FONT STYLE="white-space:nowrap">ZFP-TF</FONT> expression and mouse tau reduction were
sustained for at least six months following a single administration. Furthermore, in APP/PS1 mice, <FONT STYLE="white-space:nowrap">tau-targeted</FONT> <FONT STYLE="white-space:nowrap">ZFP-TFs</FONT> reduced dystrophic neurites by approximately 50%
across the cerebral cortex. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">AAV <FONT STYLE="white-space:nowrap">ZFP-TFs</FONT> targeting tau were administered to the adult NHP
hippocampus using real-time <FONT STYLE="white-space:nowrap">MRI-guided</FONT> stereotaxic infusion. <FONT STYLE="white-space:nowrap">ZFP-TF</FONT> treatment resulted in more than 80% lowering of tau in the hippocampus and entorhinal cortex, and
transgene expression levels were strongly correlated with tau reduction. The treatment was well tolerated for the duration of the study. We believe that together, these preclinical data from mice and NHPs highlight the potential for a single
administration of <FONT STYLE="white-space:nowrap">ZFP-TF</FONT> to lower tau as a treatment for tauopathies, including Alzheimer&#146;s disease. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are continuing preclinical development of <FONT STYLE="white-space:nowrap">tau-targeted</FONT> ZFP-TFs, and plan to present additional data
at a future scientific meeting. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I>Manufacturing Update </I></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In April 2019, we announced that we had signed an option agreement with Brammer Bio MA, LLC, or Brammer Bio, a gene therapy contract
development and manufacturing organization, to secure access to large-scale AAV manufacturing. Additionally, at our new facilities in Brisbane, California, construction is underway of a Phase 1/2 cGMP manufacturing facility, which we expect to be
operational in 2020. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The option agreement with Brammer Bio enables us to secure access to dedicated AAV manufacturing capacity up to <FONT
STYLE="white-space:nowrap">2000-L</FONT> bioreactor scale capable of handling large-scale commercial grade runs for products such as <FONT STYLE="white-space:nowrap">ST-920,</FONT> our gene therapy product candidate for Fabry disease. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Forward-Looking Statements </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Item 8.01 of
this Current Report on Form <FONT STYLE="white-space:nowrap">8-K</FONT> contains forward-looking statements, including, without limitation, statements relating to: the potential therapeutic applications for
<FONT STYLE="white-space:nowrap">SB-525,</FONT> <FONT STYLE="white-space:nowrap">ST-400,</FONT> <FONT STYLE="white-space:nowrap">SB-913,</FONT> <FONT STYLE="white-space:nowrap">SB-318</FONT> and <FONT STYLE="white-space:nowrap">SB-FIX</FONT> and for
Sangamo&#146;s <FONT STYLE="white-space:nowrap">ZFP-TF</FONT> platform technology, and their potential benefits; the anticipated initiation, enrollment, scope and rate of progress of, and data availability and other next steps related to,
Sangamo&#146;s preclinical studies and clinical trials, as well as the anticipated timing thereof; statements related to the anticipated benefits to Sangamo of its option agreement with Brammer Bio; the anticipated operational status of
Sangamo&#146;s planned manufacturing facility and the timing thereof; and other statements that are not historical fact. These forward-looking statements are based upon Sangamo&#146;s current expectations. Actual results could differ materially from
these forward-looking statements as a result of certain factors, including, without limitation, risks and uncertainties related to: the lengthy and uncertain research and development process; early, preliminary or interim data, including the
possibility of unfavorable new clinical data and further analyses of existing clinical data that could materially change Sangamo&#146;s conclusions with respect to such early, preliminary or interim data; whether the final results from clinical
trials conducted by Sangamo will validate and </P>
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support any early, preliminary or interim data reported to date and/or the overall safety and efficacy of Sangamo&#146;s product candidates; Sangamo&#146;s dependence on the success of its
clinical trials; the initiation, enrollment and completion of clinical trials; whether Sangamo will be able to effectively deliver its ZFNs to produce a beneficial therapeutic effect, including the risks that the second-generation ZFNs may not be
successfully integrated into Sangamo&#146;s product candidates and even if successfully integrated, the second-generation ZFNs may not have any advantages over Sangamo&#146;s first-generation ZFNs; whether Sangamo&#146;s ZFNs and/or <FONT
STYLE="white-space:nowrap">ZFP-TF</FONT> technology will produce any beneficial therapeutic effect; the lengthy and uncertain regulatory approval process, including whether regulatory authorities will be satisfied with the design of and results from
Sangamo&#146;s clinical trials and those of its collaborators; Sangamo&#146;s ability to maintain its collaborative relationships and Sangamo&#146;s reliance on collaborators and other third parties, including Brammer Bio, to meet their respective
obligations; the complex and difficult nature of manufacturing biological components and Sangamo&#146;s lack of experience as a company in manufacturing biologic products; Sangamo&#146;s ability to obtain or protect intellectual property rights
related to its product candidates; technological challenges Sangamo may encounter; and other risks and uncertainties affecting Sangamo and its development programs. Further, there can be no assurance that the necessary regulatory approvals for <FONT
STYLE="white-space:nowrap">SB-525,</FONT> <FONT STYLE="white-space:nowrap">ST-400,</FONT> <FONT STYLE="white-space:nowrap">SB-913,</FONT> <FONT STYLE="white-space:nowrap">SB-318,</FONT> <FONT STYLE="white-space:nowrap">SB-FIX</FONT> or any other
product candidates will be obtained or that Sangamo and its collaborators will be able to develop commercially viable product candidates for the treatment of hemophilia A, beta-thalassemia, MPS II and other diseases. These risks and uncertainties
are described more fully in Sangamo&#146;s Annual Report on Form <FONT STYLE="white-space:nowrap">10-K</FONT> for the year ended December&nbsp;31, 2018, filed with the SEC on March&nbsp;1, 2019. Forward-looking statements contained in this Current
Report on Form <FONT STYLE="white-space:nowrap">8-K</FONT> are made as of the date of this Current Report on Form <FONT STYLE="white-space:nowrap">8-K,</FONT> and Sangamo undertakes no duty to update such information except as required under
applicable law. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Item&nbsp;9.01 Financial Statements and Exhibits. </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>(b) Pro Forma Financial Information </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I>TxCell Acquisition
&#150; Pro Forma Financial Information </I></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">As previously reported, in&nbsp;the fourth quarter of&nbsp;2018, Sangamo acquired 98.2% of the
outstanding share capital and voting rights of TxCell S.A., or the TxCell Acquisition. The Company has previously included in filings with the SEC pro forma financial information giving effect to the TxCell Acquisition as of and for the nine months
ended September&nbsp;30, 2018 and for the year ended December&nbsp;31, 2017. The Company is now filing with this Current Report on Form <FONT STYLE="white-space:nowrap">8-K</FONT> the unaudited pro forma condensed combined statement of operations
for the year ended December&nbsp;31, 2018 giving effect to the TxCell Acquisition (and the notes related thereto). This pro forma financial information is attached as Exhibit 99.1 and incorporated herein by reference. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>(d) Exhibits </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="bottom" NOWRAP ALIGN="center"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-bottom:1.00pt solid #000000; display:table-cell; font-size:8pt; font-family:Times New Roman; " ALIGN="center">Description</P></TD></TR>


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<TD VALIGN="top"><A HREF="d724721dex991.htm">TxCell Acquisition: Unaudited pro forma condensed combined statement of operations for the year ended December&nbsp;31, 2018, and the notes related thereto. </A></TD></TR>
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<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="bottom" COLSPAN="3"><B>SANGAMO THERAPEUTICS, INC.</B></TD></TR>
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<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">By:</P> <P STYLE="font-size:1pt; margin-top:0pt; margin-bottom:1pt">&nbsp;</P></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ K<SMALL>ATHY</SMALL> Y. Y<SMALL>I</SMALL></P></TD></TR>
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<TD VALIGN="bottom">Name:</TD>
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<TD VALIGN="bottom">Kathy Y. Yi</TD></TR>
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<TD VALIGN="bottom">Title:</TD>
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<TD VALIGN="bottom">Executive Vice President and Chief Financial Officer</TD></TR>
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<TD VALIGN="top"> <P STYLE="font-size:12pt; margin-top:0pt; margin-bottom:0pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:10pt; font-family:Times New Roman">Dated: &nbsp;&nbsp;&nbsp;&nbsp;April 3, 2019</P></TD>
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<TYPE>EX-99.1
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<DESCRIPTION>EX-99.1
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 99.1 </B></P>
<P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Sangamo Therapeutics, Inc. </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Unaudited Pro Forma Condensed Combined Statement of Operations </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On July&nbsp;20, 2018, Sangamo Therapeutics, Inc. (the &#147;Company&#148; or &#147;Sangamo&#148;) entered into a Share Purchase Agreement (the
&#147;SPA&#148;) with certain shareholders of TxCell S.A., a French soci&eacute;t&eacute; anonyme (&#147;TxCell&#148;), and the Company and TxCell entered into a Tender Offer Agreement (the &#147;TOA&#148;), pursuant to which the Company agreed to
acquire 100% of the equity interests of TxCell (the &#147;Acquisition&#148;). On October&nbsp;1, 2018 (the &#147;Acquisition Date&#148;), the Company completed the acquisition of 13,519,036 ordinary shares of TxCell (&#147;TxCell Ordinary
Shares&#148;), representing approximately 53% of the outstanding share capital and voting rights of TxCell, pursuant to the SPA (the &#147;Block Transaction&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Company also entered into arrangements with the holders of approximately 477,000 &#147;free shares&#148; of TxCell pursuant to which the Company has the
right to purchase (call option) such shares from the holders thereof and such holders have the right to sell (put option) to the Company such shares from time to time <FONT STYLE="white-space:nowrap">through&nbsp;mid-2021</FONT> (the &#147;Free
Shares Options&#148;). Of the 477,000, approximately 453,000 are related to vested free shares, with the remaining related to unvested free shares. The purchase price for each such free share acquired by the Company upon exercise of a Free Shares
Option will be based on the performance of the Company&#146;s stock price from the announcement of the transactions contemplated by the SPA and TOA through the time of purchase (as of the Acquisition Date, the Free Shares Options purchase price was
&#128;2.58 per share or approximately $2.99 per share using an exchange rate of 1.160). For example, if the Company&#146;s stock price increases during that time period, the Free Shares Options purchase price per share will proportionately increase.
However, if the Company&#146;s stock price decreases the Free Shares Options purchase price is limited to a minimum purchase price of &#128;2.58 per share, subject to certain exceptions. The fair value of the Free Shares Options was estimated to be
$190,000, based on an option pricing method, and such value is included in the purchase consideration.&nbsp;The fair value of the Free Shares Options will vary based on future changes in the Company&#146;s stock price during the option period with
such changes in fair value being recognized in operations. The fair value of the outstanding shares of TxCell to which the Free Share Options relate is recorded as a noncontrolling interest. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In September 2018, the Company also provided TxCell with a $5.2&nbsp;million loan (the &#147;TxCell Loan&#148;) that was deemed to be part of the purchase
consideration for accounting purposes. The TxCell Loan, together with the cash paid to acquire the TxCell Ordinary Shares in the Block Transaction, or $40.5&nbsp;million, and the estimated fair value of the Free Shares Options, or $190,000, comprise
the aggregate purchase consideration of $45.9&nbsp;million as of the Acquisition Date. The estimated fair value of the net assets acquired as of the Acquisition Date was approximately $81.7&nbsp;million. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On November&nbsp;1, 2018, pursuant to the TOA, the Company commenced a cash tender offer (the &#147;Offer&#148;) to acquire all of the TxCell Ordinary Shares
not held by the Company or any subsidiary of the Company for the same per share price paid in the Block Transaction (&#128;2.58 or approximately $2.99 per share at an exchange rate of 1.160) (the &#147;Offer Price&#148;). Following the completion of
the Offer on November&nbsp;23, 2018, the Company initiated compulsory <FONT STYLE="white-space:nowrap">squeeze-out</FONT> procedures applicable to French public companies to acquire the remaining TxCell Ordinary Shares for the Offer Price, other
than the free shares subject to the Free Share Options. Subsequent to the Acquisition Date and through December&nbsp;31, 2018, the Company acquired 11,528,635 TxCell Ordinary Shares which, when aggregated with the 13,519,036 Ordinary Shares acquired
at the Acquisition Date, resulted in the Company owning 98.2% of all TxCell Ordinary Shares as of December&nbsp;31, 2018. The 11,528,635 shares acquired subsequent to the Acquisition Date were acquired for total consideration of approximately
$33.9&nbsp;million, or $2.94 per share. As of December&nbsp;31, 2018, the aggregate purchase consideration was approximately $80.4&nbsp;million through the completion of this purchase, with approximately 453,000 Ordinary Shares (vested free shares),
which remain outstanding and are subject to purchase by the Company as noted above, with an estimated fair value of approximately $1.3&nbsp;million. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The
consolidated balance sheet of the Company as of December&nbsp;31, 2018, as included in its Annual Report on Form <FONT STYLE="white-space:nowrap">10-K</FONT> for the year ended December&nbsp;31, 2018 filed with the SEC on March&nbsp;1, 2019 (the
&#147;Sangamo <FONT STYLE="white-space:nowrap">10-K&#148;),</FONT> reflects the Acquisition. As a consequence, an unaudited pro forma condensed combined balance sheet is not included herein. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The unaudited pro forma condensed combined statement of operations for the year ended December&nbsp;31, 2018 is presented as if the Acquisition had occurred
on January&nbsp;1, 2018. The unaudited pro forma condensed combined statement of operations is based on the historical financial statements of the Company and TxCell after giving effect to the Acquisition (using the acquisition method of accounting)
and the assumptions and adjustments described in the accompanying notes. The pro forma adjustments reflect events that are directly attributable to the Acquisition and that are expected to have a continuing impact on the combined results of the
Company in future periods. The unaudited pro forma condensed combined statement of operations for the year ended December&nbsp;31, 2018 combines the Company&#146;s consolidated statement of operations for the year ended December&nbsp;31, 2018 with
TxCell&#146;s unaudited statement of operations for the nine months ended September&nbsp;30, 2018. Operations of the acquired TxCell business are reflected in the consolidated statement of operations of the Company as of the October&nbsp;1, 2018
Acquisition Date. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The unaudited pro forma condensed combined statement of operations, including the notes thereto, do not reflect any potential cost
savings or other synergies that may be associated with the Acquisition. The unaudited pro forma condensed combined statement of operations is presented for illustrative purposes only and is not necessarily indicative of the combined results of
operations for future periods or the results that would have been achieved if the Acquisition had been consummated on January&nbsp;1, 2018. The pro forma adjustments are based upon information and assumptions available to the Company at the time of
filing of the Company&#146;s Current Report on Form <FONT STYLE="white-space:nowrap">8-K</FONT> to which these unaudited pro forma condensed combined statement of operations are attached as Exhibit 99.1. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The unaudited pro forma condensed combined statement of operations should be read in conjunction with the Company&#146;s historical consolidated financial
statements and notes thereto and other financial information pertaining to the Company contained in the Sangamo <FONT STYLE="white-space:nowrap">10-K</FONT> and the historical unaudited financial statements of TxCell as of and for the nine months
ended September&nbsp;30, 2018 included in Exhibit 99.2 to the Company&#146;s Current Report on Form <FONT STYLE="white-space:nowrap">8-K/A</FONT> filed with the SEC on January&nbsp;7, 2019. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Sangamo Therapeutics, Inc. </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Unaudited Pro Forma Condensed Combined Statement of Operations </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>For the Twelve Months ended December&nbsp;31, 2018 </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>(In thousands, except per share amounts) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>(1)</B><br><B>Sangamo<BR>Historical</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>(2)</B><br><B>TxCell<BR>Historical&nbsp;US<BR>GAAP</B><br><B>(in USD)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD COLSPAN="2" VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Pro Forma<BR>Adjustments</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Pro&nbsp;Forma<BR>combined</B></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><B>Revenues:</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:2.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Collaboration agreements</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">84,065</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">$</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">&#151;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">84,065</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:2.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Research grants</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">387</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">1,730</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">2,117</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><B>Total revenues</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>84,452</B></TD>
<TD NOWRAP VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>1,730</B></TD>
<TD NOWRAP VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>86,182</B></TD>
<TD NOWRAP VALIGN="bottom"><B>&nbsp;</B></TD></TR>
<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><B>Operating expenses:</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:2.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Research and development</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">114,866</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">8,802</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">123,668</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:2.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">General and administrative</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">46,736</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">3,528</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">A</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">(1,497</TD>
<TD NOWRAP VALIGN="bottom">)&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">48,767</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><B>Total operating expenses</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>161,602</B></TD>
<TD NOWRAP VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>12,330</B></TD>
<TD NOWRAP VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>172,435</B></TD>
<TD NOWRAP VALIGN="bottom"><B>&nbsp;</B></TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><B>Loss from operations</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(77,150</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(10,600</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(86,253</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:2.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Interest and other income (loss), net</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">8,261</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">(1,077</TD>
<TD NOWRAP VALIGN="bottom">)&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">B</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">(399</TD>
<TD NOWRAP VALIGN="bottom">)&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">6,785</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><B>Loss before income taxes</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(68,889</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(11,677</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(79,468</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:2.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Income taxes</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">&#151;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">&#151;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">&#151;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><B>Net loss</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(68,889</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(11,677</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>&nbsp;</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(79,468</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:2.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Net loss attributable to <FONT STYLE="white-space:nowrap">non-controlling</FONT> interest</P></TD>

<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">(555</TD>
<TD NOWRAP VALIGN="bottom">)&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">&#151;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">C</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">(208</TD>
<TD NOWRAP VALIGN="bottom">)&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">(763</TD>
<TD NOWRAP VALIGN="bottom">)&nbsp;</TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><B>Net loss attributable to Sangamo Therapeutics,&nbsp;Inc. stockholders</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"><B>$</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(68,334</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>$</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(11,677</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"><B>$</B></TD>
<TD VALIGN="bottom" ALIGN="right"><B>(78,705</B></TD>
<TD NOWRAP VALIGN="bottom"><B>)&nbsp;</B></TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:3.00px double #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:3.00px double #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:3.00px double #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:3.00px double #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:3.00px double #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:3.00px double #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><B>Loss per share</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD></TR>
<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:2.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Basic and diluted net loss per share attributable to Sangamo Therapeutics,&nbsp;Inc.
stockholders</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">(0.70</TD>
<TD NOWRAP VALIGN="bottom">)&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">(0.81</TD>
<TD NOWRAP VALIGN="bottom">)&nbsp;</TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:2.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Shares used in computing basic and diluted net loss per share attributable to Sangamo
Therapeutics, Inc. stockholders</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">96,941</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">96,941</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
</TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P> <P STYLE="line-height:8.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000;width:10%">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:8pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(1)</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman; " ALIGN="left">Sangamo consolidated statement of operations for twelve months ended December&nbsp;31, 2018. See Annual Report
on Form 10-K filed with the SEC on March&nbsp;1, 2019. </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:8pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(2)</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman; " ALIGN="left">TxCell unaudited statement of operations for the nine months ended September&nbsp;30, 2018. See Current Report
on Form <FONT STYLE="white-space:nowrap">8-K/A</FONT> filed with the SEC on January&nbsp;7, 2019. </P></TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">See the accompanying
Notes to Unaudited Pro Forma Condensed Combined Statement of Operations. </P>
</DIV></Center>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">


<Center><DIV STYLE="width:8.5in" align="left">
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Sangamo Therapeutics, Inc. </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Notes to Unaudited Pro Forma Condensed Combined Statement of Operations </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><B>1.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Description of Transactions and Basis of Presentation </B></P></TD></TR></TABLE>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I>Description of Transactions </I></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On July&nbsp;20, 2018,
Sangamo Therapeutics, Inc. (the &#147;Company&#148; or &#147;Sangamo&#148;) entered into a Share Purchase Agreement (the &#147;SPA&#148;) with certain shareholders of TxCell S.A., a French soci&eacute;t&eacute; anonyme (&#147;TxCell&#148;), and the
Company and TxCell entered into a Tender Offer Agreement (the &#147;TOA&#148;), pursuant to which the Company agreed to acquire 100% of the equity interests of TxCell (the &#147;Acquisition&#148;). On October&nbsp;1, 2018 (the &#147;Acquisition
Date&#148;), the Company completed the acquisition of 13,519,036 ordinary shares of TxCell (&#147;TxCell Ordinary Shares&#148;), representing approximately 53% of the outstanding share capital and voting rights of TxCell, pursuant to the SPA (the
&#147;Block Transaction&#148;). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Company also entered into arrangements with the holders of approximately 477,000 &#147;free shares&#148; of TxCell
pursuant to which the Company has the right to purchase (call option) such shares from the holders thereof and such holders have the right to sell (put option) to the Company such shares from time to time
<FONT STYLE="white-space:nowrap">through&nbsp;mid-2021</FONT> (the &#147;Free Shares Options&#148;). Of the 477,000, approximately 453,000 are related to vested free shares, with the remaining related to unvested free shares. The purchase price for
each such free share acquired by the Company upon exercise of a Free Shares Option will be based on the performance of the Company&#146;s stock price from the announcement of the transactions contemplated by the SPA and TOA through the time of
purchase (as of the Acquisition Date, the Free Shares Options purchase price was &#128;2.58 per share or approximately $2.99 per share using an exchange rate of 1.160). For example, if the Company&#146;s stock price increases during that time
period, the Free Shares Options purchase price per share will proportionately increase. However, if the Company&#146;s stock price decreases the Free Shares Options purchase price is limited to a minimum purchase price of &#128;2.58 per share,
subject to certain exceptions. The fair value of the Free Shares Options was estimated to be $190,000, based on an option pricing method, and such value is included in the purchase consideration.&nbsp;The fair value of the Free Shares Options will
vary based on future changes in the Company&#146;s stock price during the option period with such changes in fair value being recognized in operations. The fair value of the outstanding shares of TxCell to which the Free Share Options relate is
recorded as a noncontrolling interest. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In September 2018, the Company also provided TxCell with a $5.2&nbsp;million loan (the &#147;TxCell Loan&#148;)
that was deemed to be part of the purchase consideration for accounting purposes. The TxCell Loan, together with the cash paid to acquire the TxCell Ordinary Shares in the Block Transaction, or $40.5&nbsp;million, and the estimated fair value of the
Free Shares Options, or $190,000, comprise the aggregate purchase consideration of $45.9&nbsp;million as of the Acquisition Date. The estimated fair value of the net assets acquired as of the Acquisition Date was approximately $81.7&nbsp;million.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On November&nbsp;1, 2018, pursuant to the TOA, the Company commenced a cash tender offer (the &#147;Offer&#148;) to acquire all of the TxCell Ordinary
Shares not held by the Company or any subsidiary of the Company for the same per share price paid in the Block Transaction (&#128;2.58 or approximately $2.99 per share at an exchange rate of 1.160) (the &#147;Offer Price&#148;). Following the
completion of the Offer on November&nbsp;23, 2018, the Company initiated compulsory <FONT STYLE="white-space:nowrap">squeeze-out</FONT> procedures applicable to French public companies to acquire the remaining TxCell Ordinary Shares for the Offer
Price, other than the free shares subject to the Free Share Options. Subsequent to the Acquisition Date and through December&nbsp;31, 2018, the Company acquired 11,528,635 TxCell Ordinary Shares which, when aggregated with the 13,519,036 Ordinary
Shares acquired at the Acquisition Date, resulted in the Company owning 98.2% of all TxCell Ordinary Shares as of December&nbsp;31, 2018. The 11,528,635 shares acquired subsequent to the Acquisition Date were acquired for total consideration of
approximately $33.9&nbsp;million, or $2.94 per share. As of December&nbsp;31, 2018, the aggregate purchase consideration was approximately $80.4&nbsp;million through the completion of this purchase, with approximately 453,000 Ordinary Shares (vested
free shares), which remain outstanding and are subject to purchase by the Company as noted above, with an estimated fair value of approximately $1.3&nbsp;million. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I>Basis of Presentation </I></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The unaudited pro forma condensed
combined statement of operations has been prepared based on the Company&#146;s and TxCell&#146;s historical financial information, giving effect to the Acquisition and related adjustments described in these notes. The Company prepares its
consolidated financial statements in accordance with U.S. generally accepted accounting principles (&#147;U.S. GAAP&#148;). Certain note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been
condensed or omitted as permitted by the Securities and Exchange Commission rules and regulations. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Company accounts for business combinations in
accordance with Financial Accounting Standards Board Accounting Standards Codification (&#147;ASC&#148;) 805, &#147;Business Combinations&#148;. The consideration transferred for the Acquisition has been allocated to the assets acquired and
liabilities assumed based on their fair values. The Company expects the allocation of the consideration transferred to be final within the measurement period (up to one year from the Acquisition Date). </P>
<P STYLE="font-size:18pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><B>2.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Purchase Consideration </B></P></TD></TR></TABLE>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Pursuant to the Block Transaction, on the Acquisition Date, the Company purchased 13,519,036 TxCell Ordinary Shares at a per share price equal to the Offer
Price, or approximately $40.5&nbsp;million in the aggregate. After the completion of the Block Transaction, the Company paid cash to acquire an additional 11,528,635 TxCell Ordinary Shares (such shares, the &#147;Additional Shares&#148;) for $2.94
per share for total consideration of approximately $33.9&nbsp;million via open market purchases, the Offer, and the <FONT STYLE="white-space:nowrap">squeeze-out</FONT> procedures through December&nbsp;31, 2018 (as of the Acquisition Date, the
estimated purchase price for the Additional Shares was $2.99 per share using the exchange rate of 1.160, for total estimated </P>
</DIV></Center>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">


<Center><DIV STYLE="width:8.5in" align="left">
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
consideration of $34.5 million). Further, the TxCell Loan is considered part of the purchase consideration. Also included in the purchase consideration is the fair value of the Free Shares
Options of approximately $190,000 as of the Acquisition Date, based on an option pricing method. The fair value of the Free Shares Options will vary based on future changes in the Company&#146;s stock price during the option period with such changes
in fair value being recognized in operations. As of December&nbsp;31, 2018 the aggregate purchase consideration was approximately $80.4&nbsp;million, with approximately 453,000 TxCell Ordinary Shares (vested free shares), which remain outstanding
and are subject to purchase by the Company, with an estimated fair value of approximately $1.3&nbsp;million. The aggregate purchase consideration of $80.4&nbsp;million computed as of the Acquisition Date is as follows (in thousands): </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="93%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>


<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Cash paid to purchase TxCell Ordinary Shares in the Block Transaction</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">40,499</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Estimated cash payable to acquire the Additional Shares</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">34,516</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">TxCell Loan</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">5,222</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Estimated fair value of the Free Shares Options</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">190</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Total</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">80,427</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:3.00px double #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-top:3.00px double #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD></TR>
</TABLE> <P STYLE="font-size:18pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><B>3.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>TxCell Financial Statement Translation </B></P></TD></TR></TABLE>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The historical financial statements of TxCell for the period ended September&nbsp;30, 2018 included in Exhibit 99.2 to the Company&#146;s Current Report on
Form <FONT STYLE="white-space:nowrap">8-K/A</FONT> filed with the SEC on January 7, 2019 were prepared in accordance with International Financial Reporting Standards (&#147;IFRS&#148;) as issued by the International Accounting Standards Board
(&#147;IASB&#148;) and presented in Euros. For purposes of preparing the unaudited pro forma condensed combined statement of operations, the historical financial information of TxCell was translated from Euros to US dollars using the historical
average exchange rate for the nine months ended September&nbsp;30, 2018 of 1.194. </P> <P STYLE="font-size:18pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><B>4.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Pro Forma Adjustments </B></P></TD></TR></TABLE>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The unaudited pro forma condensed combined statement of operations includes the following pro forma adjustments: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left">A.</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Adjustment to eliminate the historical transaction costs incurred related to the Block Transaction that were
expensed by the Company and TxCell. </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left">B.</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Adjustment to eliminate TxCell interest expense related to historical convertible debt either redeemed in
connection with the Block Transaction or converted into TxCell Ordinary Shares that were acquired as part of the Block Transaction in accordance with the original terms of these instruments. </P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left">C.</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Adjustment to reflect the share of TxCell net loss attributable to the noncontrolling interest prior to the
Acquisition Date. </P></TD></TR></TABLE>
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