Company: LNAI
Filing Date: 2025-02-19
Form Type: 10-K/A
Source: 0001731122-25-000252
Chunk: 35

Company: Lunai Bioworks Inc.
Filing Date: 2025-02-19
Form: 10-K/A
Chunk 35
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, could harm our reputation, divert management’s attention
from our operations and result in substantial legal fees and other costs. Additionally, we have in the past been subject to intense media
scrutiny, which exposes us to increasing regulation, government investigations, legal actions, and penalties.

We have also been named in several
lawsuits related to Mr. Gümrükcü. For example, the Company and certain of its current and former officers have been named
in securities class actions by purported stockholders of ours, alleging 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 Mr. Gümrükcü and its commercial prospects. In addition, two stockholders
filed stockholder derivative action lawsuits purportedly on behalf of the Company against certain of our executive officers
and the members of our Board of Directors alleging violations of Sections 14(a) and 20(a) of the Securities Exchange Act of 1934 and also
setting out claims for breach of fiduciary duty, contribution and indemnification, aiding and abetting, and gross mismanagement. Additionally,
from time to time, we may be, and currently are, subject to inquiries from regulators in which they seek information about us. Such further
inquiries could result in more formal investigations or allegations, which could adversely impact our business, financial condition, and
operating results.

Litigation, regulatory proceedings,
such as the investigations described above, as well as the related class action claims and lawsuits, and securities matters that we are
currently facing or could face, can be protracted and expensive, and have results that are difficult to predict. Certain of these matters
include speculative claims for substantial or indeterminate amounts of damages and include claims for injunctive relief. Additionally,
our legal costs for any of these matters, either alone or in the aggregate, could be significant. Adverse outcomes with respect to any
of these legal or regulatory proceedings may result in significant settlement costs or judgments, penalties, and fines. Even if these
proceedings are resolved in our favor, the time and resources necessary to resolve them could divert the resources of our management and
require significant expenditures. See Note 11 - Commitments and Contingencies in the Notes to our Consolidated Financial
Statements in Part II, Item 8 of this