Company: LNAI
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001731122-25-000765
Chunk: 127

Company: Lunai Bioworks Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 8
Chunk 127
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20, 2022, Susan Midler filed a shareholder derivative action in the Superior Court of California, Los Angeles County, reciting
similar underlying facts as those alleged in the Securities Class Action Litigation (the “Midler Matter”). The action, filed
on behalf of the Company, names Serhat Gümrükcü and certain of the Company’s current and former directors as defendants.
The action also names the Company as a nominal defendant. The action sets out claims for breaches of fiduciary duty, contribution and
indemnification, aiding and abetting, and gross mismanagement. Plaintiff does not quantify any alleged injury, but seeks damages, disgorgement,
restitution, and other costs and expenses. On January 20, 2023, the Court stayed the Midler matter pending resolution of the defendants’
anticipated motion to dismiss in the Securities Class Action Litigation. On June 28, 2024, the United States District Court for the Central
District of California denied the defendants’ motion to dismiss the Securities Class Action Litigation. On April 29, 2025, the court
stayed the Midler Matter for ninety (90) days. The parties’ deadline to file a joint status report in the Midler action is July
28, 2025. The defendants have not yet responded to the complaint. The Company intends to contest this matter but expresses no opinion
as to the likelihood of a favorable outcome. Management is unable to determine the likelihood of a loss, including a possible range of
losses, if any, arising from this matter as of the reporting date.

37

On October
21, 2022, the Company filed a Complaint in the Superior Court of the State of California for the County of Los Angeles against Serhat
Gümrükcü, William Anderson Wittekind (“Wittekind”), G Tech Bio, SG & AW Holdings, LLC, and SRI (collectively,
the “Defendants”). The Complaint alleges that the Defendants engaged in a “concerted, deliberate scheme to alter, falsify,
and misrepresent to the Company the results of multiple studies supporting its Hepatitis B and SARS-CoV-2/influenza pipelines.”
Specifically, “Defendants manipulated negative results to reflect positive outcomes from various studies, and even fabricated studies
out of whole cloth.” As a result of the Defendants’ conduct, the Company claims that it “paid approximately $25 million
to Defendants and third-parties that it would