Company: LNAI
Filing Date: 2025-02-19
Form Type: 10-Q
Source: 0001731122-25-000258
Chunk: 117

Company: Lunai Bioworks Inc.
Filing Date: 2025-02-19
Form: 10-Q
Item: Part I, Item 8
Chunk 117
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 affect our internal controls.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings.

Securities Class Action Litigation.
On July 26, 2022 and July 28, 2022, securities class action complaints (the former, the “Chow Action” and the latter, the
“Manici Action”) and together, the “Securities Class Action Litigation”) were filed by purported stockholders
of the Company in the United States District Court for the Central District of California against the Company and certain of the Company’s
current and former officers and directors. The complaints allege, among other things, that the defendants violated Sections 10(b) and
20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 thereunder, by making false and misleading statements and omissions
of material fact in connection with the Company’s relationship with Serhat Gümrükcü and its commercial prospects.
The complaints seek unspecified damages, interest, fees, and costs. On November 22, 2022, the Manici Action was voluntarily dismissed
without prejudice, but the Chow action remains pending. On October 22, 2023, the Court appointed a lead plaintiff in the Chow Action.
The lead plaintiff filed an amended complaint on December 15, 2023. The Company has filed a motion to dismiss the amended complaint on
March 15, 2024. The Court denied the Company’s motion to dismiss on June 28, 2024. A mediation was held on September 17, 2024, after
which the parties signed a stipulation of settlement, dated November 8, 2024. The plaintiff filed their motion for preliminary approval
of the settlement on December 9, 2024. On December 18, 2024, the Company filed a notice of non-opposition to 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. On January 19, 2023, John Solak filed a substantially similar shareholder derivative action in the United States District
Court for the District of Delaware. Both derivative actions recite similar underlying facts as those alleged in the Securities Class Action