Company: LNAI
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001731122-25-000765
Chunk: 64

Company: Lunai Bioworks Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 1
Chunk 64
---
 the motion for preliminary approval
of the settlement. On January 7, 2025, the Court took the plaintiff’s motion for preliminary approval of the settlement under consideration
without oral argument.

Federal Derivative
Litigation. On September 22, 2022, Samuel E. Koenig filed a shareholder derivative action in the United States District Court
for the Central District of California (the “Koenig Matter”). On January 19, 2023, John Solak filed a substantially
similar shareholder derivative action in the United States District Court for the District of Delaware (the “Solak
Matter”). Both derivative actions recite similar underlying facts as those alleged in the Securities Class Action Litigation.
The actions, filed on behalf of the Company, name Serhat Gümrükcü and certain of the Company’s former directors
as defendants. The actions also name the Company as a nominal defendant. The actions allege violations of Sections 14(a) and 20(a)
of the Securities Exchange Act of 1934 and also set out claims for breach of fiduciary duty, contribution and indemnification,
aiding and abetting, and gross mismanagement. Plaintiffs do not quantify any alleged injury, but seek damages, disgorgement,
restitution, and other costs and expenses. On January 24, 2023, the United States District Court for the Central District of
California stayed the Koenig Matter pending resolution of the defendants’ anticipated motion to dismiss in the Securities
Class Action Litigation. On April 4, 2023, the United States District Court for the District of Delaware stayed the Solak Matter
pending resolution of the defendants’ anticipated motion to dismiss in the Securities Class Action Litigation. On June 28,
2024, the United States District Court for the Central District of California denied the defendants’ motion to dismiss the
Securities Class Action Litigation. The Koenig Matter is currently stayed and the parties’ deadline to file a joint status
report is July 11, 2025. On April 30, 2025, the court stayed the Solak Matter for ninety (90) days and the deadline for the parties
to file a joint status report or further stay of the action is July 29, 2025. The defendants have not yet responded to the Koenig or
Solak complaints. The Company intends to contest these matters but expresses no opinion as to the likelihood of favorable outcomes.
Management is unable to determine the likelihood