PART III — NARRATIVE
State below in
reasonable detail why Forms 10-K, 20-F, 11-K, 10-Q,
10-D, N-CEN, N-CSR, or the transition report or portion thereof, could not be filed within the prescribed time period.
Adverum Biotechnologies, Inc. (the “Company”) is unable to timely file with the Securities and Exchange Commission (“SEC”)
its Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”) without unreasonable effort or expense.
As previously disclosed, on March 28, 2025, the Audit Committee of the Board of Directors (the “Audit Committee”) of the Company,
following consultation with the Company’s management and independent registered public accounting firm, Ernst & Young LLP, concluded that certain of the Company’s previously issued financial statements should no longer be relied
upon due to non-cash errors identified in the accounting for an operating lease and sublease related to a building in North Carolina (the “NC Premises”).
In January 2021, the Company entered into the operating lease for the NC Premises, and in October 2021, the Company entered into the sublease
agreement with Jaguar Gene Therapy, LLC, who subsequently assigned the sublease to Advanced Medical Partners, LLC as the subtenant for the NC Premises, through the remainder of the lease term. While preparing the consolidated financial statements as
of and for the year ended December 31, 2024, management discovered non-cash errors in the Company’s accounting for its operating lease and sublease of the NC Premises. The errors relate solely to the
Company’s accounting for tenant improvement allowances provided by the landlord to the Company under its operating lease, which were subsequently conveyed from the Company to the subtenant under the sublease. The errors affect the reported
amounts of non-cash assets and liabilities, and non-cash general and administrative expenses, related to the lease and sublease (the “Misstatements”).
The Misstatements relate solely to the NC Premises and require non-cash corrections to the
Company’s previously issued audited consolidated financial statements as of and for the years ended December 31, 2022 and 2023, included in the Company’s Annual Report on Form 10-K for the year
ended December 31, 2023 (the “Annual Report”), as well as the unaudited condensed consolidated quarterly financial information for the quarterly periods in the years ended December 31, 2023 and 2024 (collectively the
“Restated Periods”), included in the Company’s Quarterly Reports on Form 10-Q for the quarterly periods within those years (“Quarterly Reports” and, together with the Annual Report,
the “Affected Reports”). The Audit Committee concluded that it is appropriate to correct the Misstatements by restating the financial statements for the Restated Periods.
The Company will include the restated financial statements for the Restated Periods in its 2024 Annual Report. The previously issued financial
statements included in the Affected Reports should no longer be relied upon. The Company does not intend to separately amend the Affected Reports.
Management is assessing the effect of these restatements on the Company’s internal control over financial reporting and its disclosure
controls and procedures. The Company expects to report at least one material weakness following completion of its analysis of the cause of the restatements. A material weakness is a deficiency, or a combination of deficiencies, in internal control
over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis. The existence of one or more material
weaknesses precludes a conclusion by management that the Company’s disclosure controls and procedures and internal control over financial reporting are effective. As a result of the expected material weakness(es), the Company believes that its
internal control over financial reporting was not effective, and its disclosure controls and procedures were not effective, for the Restated Periods.
Despite working diligently to timely file its 2024 Annual Report, the Company will be unable to complete all work necessary to timely file its
2024 Annual Report, including the determination of all required adjustments thereto and the corresponding impact on the financial statements to be included in the Company’s 2024 Annual Report and evaluation of its internal controls and
procedures and disclosure controls and procedures. The Company expects to file its 2024 Annual Report with the SEC as soon as practicable, and no later than the fifteenth calendar day following the prescribed due date, in accordance with Rule 12b-25.
