Company: LNAI
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001731122-25-001544
Chunk: 60

Company: Lunai Bioworks Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 60
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 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.

    8

Management has reduced overhead
and administrative costs by streamlining the organization to focus around the development, validation, and commercialization of its AI-driven
neurology and oncology diagnostics and therapeutic development 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, which would likely have a material adverse effect on our business, stock price and our relationships with
third parties with whom we have business relationships, at least until additional funding is obtained. If we do not have sufficient funds
to continue operations, we could be required to seek bankruptcy protection or other alternatives that could result in our stockholders
losing some or all of their investment in us.

Funding that we may receive during
the fiscal year 2026 is expected to be used to satisfy existing and future obligations and liabilities and working capital needs, to support
commercialization of our products, to conduct the clinical and regulatory work to develop our product candidates, and to begin building
working capital reserves.

NOTE 3 — FAIR VALUE MEASUREMENTS 

The Company accounts for fair value
measurements for financial assets and financial liabilities in accordance with FASB ASC Topic 820, “Fair Value Measurements”.
The authoritative guidance among other things, defines fair value, establishes a consistent framework for measuring fair value and expands
disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value
is defined as the exit price, representing the amount that would either be received to sell an asset or be paid to transfer a liability
in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based
on assumptions that market participants would use in pricing an asset or liability