Company: LNAI
Filing Date: 2025-02-19
Form Type: 10-Q
Source: 0001731122-25-000258
Chunk: 90

Company: Lunai Bioworks Inc.
Filing Date: 2025-02-19
Form: 10-Q
Item: Part I, Item 8
Chunk 90
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 merger involving the Company and two
companies closely associated with Gumrukcu. In the complaint, the Company alleges that Gumrukcu and others deliberately and fraudulently
concealed a murder-for-hire scheme from the Company in order to induce the Company to enter into the merger agreement, which resulted
in the defendants receiving shares and compensation. The Company asserts claims for fraudulent concealment, equitable fraud, unjust enrichment,
and civil conspiracy and seeks, inter alia, equitable relief, including, but not limited to, return to the Company any shares received
in connection with the merger, and damages. On October 1, 2024, the defendants moved to dismiss the complaint.

NOTE 8 — RELATED PARTY TRANSACTIONS 

As of December 31, 2024, the Company
has accrued $384,949 of compensation related expenses for the Company’s former Chief Executive Officer, Mark Dybul, related to budget
constraints.

On August 23, 2024, Avram Miller,
a former member of the Board of Directors, forfeited 833,333 shares of Common Stock from the original 1,000,000 shares of Common Stock
for advisory services originally granted to him on October 11, 2023. As consideration for such forfeiture, the Company granted to Mr.
Miller, an option to purchase 978,261 shares of Common Stock of the Company with a per-share exercise price of, $0.69. The Company determined
that this transaction represented a modification of the original award. The Company measured the fair value of the options issued as compared
to the fair value of the original issuance and determined that there was no incremental compensation to recognize as the fair value of
the options was less than the fair value of the Common Stock. Therefore, the Company will recognize the remaining fair value of the original
award over the remaining vesting period, which is one year. The Company recognized stock-based compensation expense of $538,127 related
to the vesting of the stocks options during the period ended December 31, 2024. At December 31, 2024, the Company had $806,716 of unrecognized
compensation cost related to the options which vest at August 23, 2025.

NOTE 9 — SEGMENT REPORTING

For the period ending December
31, 2024, the Company had two reportable segments. These segments have different strategic and economic goals and are managed separately
because they require different technology and marketing strategies.