Company: LNAI
Filing Date: 2025-09-29
Form Type: 10-K
Source: 0001731122-25-001316
Chunk: 841

Company: Lunai Bioworks Inc.
Filing Date: 2025-09-29
Form: 10-K
Item: Item 7A
Chunk 841
---
 future exercise patterns and post-vesting employment termination behavior.
Accordingly, the Company has elected to use the “simplified method” to estimate the expected term of its share-based awards.
The simplified method computes the expected term as the sum of the award’s vesting term plus the original contractual term divided
by two.

New Accounting Pronouncements
Not Yet Adopted - Recent accounting pronouncements issued by the FASB that have not yet been adopted by the Company are not expected
to have a material impact on the Company’s present or future consolidated financial statements.

    F-12

NOTE 2 – GOING CONCERN

The Company’s consolidated
financial statements are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates
the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has incurred substantial
recurring losses from continuing operations, has used cash in the Company’s continuing operations, and is dependent on additional
financing to fund operations. The Company incurred a net loss of $178,007,489 and $88,425,828 for the years ended June 30, 2025 and 2024,
respectively. As of June 30, 2025, the Company had cash and cash equivalents of $92,700 and an accumulated deficit of $510,462,570 and
a working capital deficit of $28,109,502. These conditions raise substantial doubt about the Company’s ability to continue as a
going concern for one year after the date the financial statements are issued. The consolidated financial statements do not include any
adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be
necessary should the Company be unable to continue in existence.

Management has reduced overhead
and administrative costs by streamlining the organization to focus on the development and validation of its AI-driven cancer diagnostics
platform. The Company has tailored its workforce to focus on these activities. In addition, the Company intends to secure additional required
funding through equity or debt financing. However, there can be no assurance that the Company will be able to obtain any sources of funding.
Such additional funding may not be available or may not be available on reasonable terms, and, in the case of equity financing transactions,
could result in significant additional dilution to our stockholders. If we do not obtain required additional equity or debt funding, our
cash resources will be depleted and we could be required to materially reduce or suspend operations,