Company: IXHL
Filing Date: 2025-04-17
Form Type: PRER14A
Source: 0001213900-25-033013
Chunk: 42

Company: Incannex Healthcare Inc.
Filing Date: 2025-04-17
Form: PRER14A
Chunk 42
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 attracting, retaining and motivating key personnel. We believe that
the increase in the number of shares available for issuance under our Amended 2023 Plan and the addition of the Evergreen Provision is
essential to permit our management to continue to provide long-term, equity-based incentives to present and future key employees, consultants
and directors. Our board of directors believes that the number of shares currently remaining available for issuance pursuant to future
awards under the 2023 Plan is not sufficient for future granting needs. Our board of directors currently believes that if the Amended
2023 Plan is approved by stockholders, the additional 2,700,000 shares available for issuance under the Amended 2023 Plan plus the Evergreen
Provision will result in an adequate number of shares of common stock being available for future awards under the Amended 2023 Plan for
approximately eight additional years following the current year.

Potential Adverse Effects of the Approval of the Amended 2023 Plan

Following approval of the Equity Incentive Plan
Proposal, existing stockholders may suffer substantial dilution in their ownership interests as a result of the potential issuance of
shares of common stock pursuant to awards under the Amended 2023 Plan and application of its Evergreen Provision. The Evergreen Provision
contemplates the following Evergreen Increases: the number of shares authorized for issuance of awards under the Amended 2023 Plan would
increase automatically on September 30, 2025 in an amount equal to 20% of the then outstanding shares of common stock on September 30,
2025, and further increase on the first day of each Fiscal Year beginning with the 2026 Fiscal Year commencing on July 1, 2026 and ending
on (and including) the first day of the 2032 Fiscal Year commencing on July 1, 2032, in an amount equal to 5% of the then-outstanding
shares of common stock on such dates. Accordingly, the number of shares reserved for issuance pursuant to the Amended 2023 Plan could
substantially increase depending on the extent to which the Company issues new shares of common stock prior to each Evergreen Increase.
For example, if prior to the first Evergreen Increase on September 30, 2025 the holders of Series A Warrants exercise all of the Series
A Warrants for an aggregate of 347,222,700 shares of our common stock (assuming full adjustment of the exercise price equal to the Floor
Price