Company: LNAI
Filing Date: 2025-10-15
Form Type: DEF 14A
Source: 0001731122-25-001378
Chunk: 43

Company: Lunai Bioworks Inc.
Filing Date: 2025-10-15
Form: DEF 14A
Chunk 43
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 of Our Compensation Philosophy

Our Board believes that the effective
use of stock-based, long-term incentive compensation is vital to our ability to achieve strong performance in the future. The Amended
Incentive Plan will maintain and enhance the key policies and practices adopted by our management and the Board to align employee and
stockholder interests and to link compensation to Company performance. In addition, our future success depends, in large part, upon our
ability to maintain a competitive position in attracting, retaining, and motivating key personnel.

We believe it is critical for our
long-term success that the interests of our employees and other service providers are tied to our success as “owners” of our
business. The equity incentive programs we have in place are intended to build stockholder value by attracting and retaining talented
employees and other service providers. We believe we must continue to offer competitive equity compensation packages in order to retain
and motivate the talent necessary for our continued growth and success. We carefully monitor the equity compensation and equity holdings
of our employees, directors and consultants as well as the type of equity awards we grant to ensure these awards continue to provide incentives
for the recipients to work towards our success.

We believe that the increase in
the number of Authorized Shares available for issuance under the Amended Incentive Plan is essential to permit our management to continue
to provide long-term, equity-based incentives to present and future key employees, consultants, and non-employee directors. The Board
believes that the number of Authorized Shares currently remaining available for issuance pursuant to future awards under the 2023 Incentive
Plan (as of the date hereof) is not sufficient for future granting needs. The Board currently believes that if the Amended Incentive Plan
is approved by stockholders, the total of 3,476,722 Authorized Shares available for issuance under the Amended Incentive Plan, will result
in an adequate number of shares of Common Stock being available for future awards under the Amended Incentive Plan with the addition of
the evergreen clause.

<div align='center'>27</div>

Overhang

The following table provides certain information regarding
our equity incentive program.

| Overhang                                                                                   
 Total number of shares subject to outstanding Awards under the 2023 Incentive Plan         |     | As of October 3, 2025 |   680,150 |
|:-------------------------------------------------------------------------------------------|:----|:----------------------|----------:|
| Weighted-average exercise price of outstanding Stock Options under